II

103D CONGRESS

2D SESSION S. 1587

[Report No. 103–259]

To revise and streamline the acquisition laws of the Federal Government,

and for other purposes.

IN THE SENATE OF THE UNITED STATES

OCTOBER 26 (legislative day, OCTOBER 13), 1993

Mr. GLENN (for himself, Mr. BINGAMAN, Mr. LEVIN, Mr. NUNN, Mr. BUMPERS, Mr. LIEBERMAN, Mr. ROTH, and Mr. COHEN) introduced the following bill; which was read twice and referred to the Committee on Governmental Affairs

NOVEMBER 1 (legislative day, OCTOBER 13), 1993

Ordered, that if and when reported from the Committee on Governmental Affairs, the bill be referred to the Committee on Armed Services for not

to exceed 30 session days, with instructions that if the Committee on

Armed Services does not report the bill within that time period, they be

deemed discharged from further consideration of the bill and it be referred to the Committee on Small Business for not to exceed 20 session

days, solely for consideration of title IV of the introduced bill, with instructions that if the Committee on Small Business does not report the

bill within that time period they be deemed discharged from further consideration of the bill and it be placed on the calender

MAY 11 (legislative day, MAY 2), 1994

Reported by Mr. GLENN, with an amendment; referred to the Committee on

Armed Services pursuant to the order of November 1, 1993

MAY 12 (legislative day, MAY 2), 1994

Reported by Mr. NUNN, without amendment, referred to the Committee on

Small Business pursuant to the order of November 1, 1993

[Strike out all after the enacting clause and insert the part printed in italic]
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A BILL

To revise and streamline the acquisition laws of the Federal

Government, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Federal Acquisition

5 Streamlining Act of 1994’’.

6 SEC. 2. TABLE OF CONTENTS.

7 The table of contents for this Act is as follows:

TITLE I—CONTRACT FORMATION

Subtitle A—Competition Statutes

PART I—ARMED SERVICES ACQUISITIONS

SUBPART A—COMPETITION REQUIREMENTS

Sec. 1001. References to Federal Acquisition Regulation.

Sec. 1002. Establishment or maintenance of alternative sources of supply.

Sec. 1003. Clarification of approval authority for use of procedures other than

full and open competition.

Sec. 1004. Task order contracts for advisory and assistance services.

Sec. 1005. Acquisition of expert services.

SUBPART B—PLANNING, SOLICITATION, EVALUATION, AND AWARD

Sec. 1011. Source selection factors.

Sec. 1012. Solicitation provision regarding evaluation of purchase options.

Sec. 1013. Prompt notice of award.

Sec. 1014. Post-award debriefings.

Sec. 1015. Protest file.

Sec. 1016. Award of costs and fees in agency settlement of protests.

Sec. 1017. Two-phase selection procedures.

SUBPART C—KINDS OF CONTRACTS

Sec. 1021. Secretarial determination regarding use of cost type or incentive contract.

Sec. 1022. Technical and conforming amendments.

SUBPART D—MISCELLANEOUS PROVISIONS FOR THE ENCOURAGEMENT OF

COMPETITION

Sec. 1031. Repeal of requirement for annual report by advocates for competition.
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PART II—CIVILIAN AGENCY ACQUISITIONS

SUBPART A—COMPETITION REQUIREMENTS

Sec. 1051. References to Federal Acquisition Regulation.

Sec. 1052. Establishment or maintenance of alternative sources of supply.

Sec. 1053. Clarification of approval authority for use of procedures other than

full and open competition.

Sec. 1054. Task order contracts for advisory and assistance services.

Sec. 1055. Acquisition of expert services.

Sec. 1056. Continued occupancy of leased space.

SUBPART B—PLANNING, SOLICITATION, EVALUATION, AND AWARD

Sec. 1061. Solicitation, evaluation, and award.

Sec. 1062. Solicitation provision regarding evaluation of purchase options.

Sec. 1063. Prompt notice of award.

Sec. 1064. Post-award debriefings.

Sec. 1065. Protest file.

Sec. 1066. Award of costs and fees in agency settlement of protests.

Sec. 1067. Two-phase selection procedures.

SUBPART C—KINDS OF CONTRACTS

Sec. 1071. Agency head determination regarding use of cost type or incentive contract.

Sec. 1072. Multiyear contracting authority.

Sec. 1073. Severable services contracts crossing fiscal years.

Sec. 1074. Economy Act purchases.

PART III—ACQUISITIONS GENERALLY

Sec. 1091. Policy regarding consideration of contractor past performance.

Sec. 1092. Repeal of requirement for annual report on competition.

Subtitle B—Truth in Negotiations

PART I—ARMED SERVICES ACQUISITIONS

Sec. 1201. Stabilization of dollar threshold of applicability.

Sec. 1202. Exceptions to cost or pricing data requirements.

Sec. 1203. Limitation on authority to require a submission not otherwise required.

Sec. 1204. Additional special rules for commercial items.

Sec. 1205. Right of United States to examine contractor records.

Sec. 1206. Required regulations.

Sec. 1207. Consistency of time references.

Sec. 1208. Exception for transfers between divisions, subsidiaries, and affiliates.

Sec. 1209. Repeal of superseded provision.

PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 1251. Revision of civilian agency provisions to ensure uniform treatment of

cost or pricing data.

Sec. 1252. Repeal of obsolete provision.

Subtitle C—Research and Development

Sec. 1301. Research projects.
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Sec. 1302. Elimination of inflexible terminology regarding coordination and communication of defense research activities.

Subtitle D—Procurement Protests

PART I—PROTESTS TO THE COMPTROLLER GENERAL

Sec. 1401. Protest defined.

Sec. 1402. Review of protests and effect on contracts pending decision.

Sec. 1403. Decisions on protests.

Sec. 1404. Regulations.

PART II—PROTESTS IN THE FEDERAL COURTS

Sec. 1421. Nonexclusivity of remedies.

Sec. 1422. Jurisdiction of the United States Court of Federal Claims.

PART III—PROTESTS IN PROCUREMENTS OF AUTOMATIC DATA PROCESSING

Sec. 1431. Revocation of delegations of procurement authority.

Sec. 1432. Authority of the General Services Administration Board of Contract

Appeals.

Sec. 1433. Periods for certain actions.

Sec. 1434. Dismissals of protests.

Sec. 1435. Award of costs.

Sec. 1436. Dismissal agreements.

Sec. 1437. Jurisdiction of district courts.

Sec. 1438. Matters to be covered in regulations.

Sec. 1439. Definitions.

Subtitle E—Definitions and Other Matters

PART I—ARMED SERVICES ACQUISITIONS

Sec. 1501. Definitions.

Sec. 1502. Delegation of procurement functions.

Sec. 1503. Determinations and decisions.

Sec. 1504. Undefinitized contractual actions: restrictions.

Sec. 1505. Production special tooling and production special test equipment: contract terms and conditions.

Sec. 1506. Regulations for bids.

PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 1551. Definitions.

Sec. 1552. Delegation of procurement functions.

Sec. 1553. Determinations and decisions.

Sec. 1554. Cooperative purchasing.

TITLE II—CONTRACT ADMINISTRATION

Subtitle A—Contract Payment

PART I—ARMED SERVICES ACQUISITIONS

Sec. 2001. Contract financing.

Sec. 2002. Contracts: vouchering procedures.
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PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 2051. Contract financing.

Subtitle B—Cost Principles

PART I—ARMED SERVICES ACQUISITIONS

Sec. 2101. Allowable contract costs.

Sec. 2102. Contract profit controls during emergency periods.

PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 2151. Allowable contract costs.

PART III—ACQUISITIONS GENERALLY

Sec. 2191. Travel expenses of government contractors.

Subtitle C—Audit and Access to Records

PART I—ARMED SERVICES ACQUISITIONS

Sec. 2201. Consolidation and revision of authority to examine records of contractors.

PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 2251. Authority to examine records of contractors.

Subtitle D—Cost Accounting Standards

Sec. 2301. Exceptions to coverage.

Sec. 2302. Repeal of obsolete deadline regarding procedural regulations for the

Cost Accounting Standards Board.

Subtitle E—Administration of Contract Provisions Relating to

Price, Delivery, and Product Quality

PART I—ARMED SERVICES ACQUISITIONS

Sec. 2401. Procurement of critical aircraft and ship spare parts; quality control.

Sec. 2402. Contractor guarantees regarding weapon systems.

PART II—ACQUISITIONS GENERALLY

Sec. 2451. Section 3737 of the Revised Statutes: expansion of authority to prohibit setoffs against assignees; reorganization of section; revision

of obsolete provisions.

Sec. 2452. Repeal of requirement for deposit of contracts with GAO.

Subtitle F—Claims and Disputes

PART I—ARMED SERVICES ACQUISITIONS

Sec. 2501. Certification of contract claims.

Sec. 2502. Shipbuilding claims.
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PART II—ACQUISITIONS GENERALLY

Sec. 2551. Claims jurisdiction of United States district courts and the United

States Court of Federal Claims.

Sec. 2552. Contract Disputes Act improvements.

Sec. 2553. Extension of alternative dispute resolution authority.

Sec. 2554. Expedited resolution of contract administration complaints.

TITLE III—SERVICE SPECIFIC AND MAJOR SYSTEMS

STATUTES

Subtitle A—Major Systems Statutes

Sec. 3001. Requirement for independent cost estimates and manpower estimates

before development or production.

Sec. 3002. Enhanced program stability.

Sec. 3003. Repeal of requirement to designate certain major defense acquisition

programs as defense enterprise programs.

Sec. 3004. Repeal of requirement for competitive prototyping in major programs.

Sec. 3005. Repeal of requirement for competitive alternative sources in major programs.

Subtitle B—Testing Statutes

Sec. 3011. Director of Operational Test and Evaluation to report directly to Secretary of Defense.

Sec. 3012. Responsibility of Director of Operational Test and Evaluation for live

fire testing.

Sec. 3013. Requirement for unclassified version of annual report on operational

test and evaluation.

Subtitle C—Service Specific Laws

Sec. 3021. Gratuitous services of officers of certain reserve components.

Sec. 3022. Authority to rent samples, drawings, and other information to others.

Sec. 3023. Civil Reserve Air Fleet.

Sec. 3024. Exchange of personnel.

Sec. 3025. Scientific investigation and research for the Navy.

Sec. 3026. Construction of combatant and escort vessels and assignment of vessel

projects.

Sec. 3027. Repeal of requirement for construction of vessels on Pacific coast.

Sec. 3028. Authority to transfer by gift a vessel stricken from Naval Vessel Register.

Sec. 3029. Naval salvage facilities.

Subtitle D—Department of Defense Commercial and Industrial

Activities

Sec. 3051. Factories and arsenals: manufacture at.

Sec. 3052. Accounting requirement for contracted advisory and assistance services.

Subtitle E—Fuel- and Energy-Related Laws

Sec. 3061. Liquid fuels and natural gas: contracts for storage, handling, or distribution.
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Subtitle F—Fiscal Statutes

Sec. 3071. Disbursement of funds of military department to cover obligations of

another agency of Department of Defense.

Subtitle G—Miscellaneous

Sec. 3081. Obligation of funds: limitation.

Sec. 3082. Repeal of requirements regarding product evaluation activities.

Sec. 3083. Codification and revision of limitation on lease of vessels, aircraft, and

vehicles.

Sec. 3084. Soft drink supplies for exchange stores.

Sec. 3085. Repeal of preference for recycled toner cartridges.

TITLE IV—SIMPLIFIED ACQUISITION THRESHOLD AND SOCIOECONOMIC, SMALL BUSINESS, AND MISCELLANEOUS

LAWS

Subtitle A—Simplified Acquisition Threshold

PART I—ESTABLISHMENT OF THRESHOLD

Sec. 4001. Simplified acquisition threshold.

PART II—SIMPLIFICATION OF PROCEDURES

Sec. 4011. Simplified acquisition procedures.

Sec. 4012. Small business reservation.

Sec. 4013. Fast payment under simplified acquisition procedures.

Sec. 4014. Procurement notice.

Sec. 4015. Electronic commerce for Federal Government procurements.

PART III—APPLICABILITY OF LAWS TO ACQUISITIONS NOT IN EXCESS OF

SIMPLIFIED ACQUISITION THRESHOLD

Sec. 4021. Future enacted procurement laws.

Sec. 4022. Armed services acquisitions.

Sec. 4023. Civilian agency acquisitions.

Sec. 4024. Acquisitions generally.

PART IV—CONFORMING AMENDMENTS

Sec. 4071. Armed services acquisitions.

Sec. 4072. Civilian agency acquisitions.

Sec. 4073. Office of Federal Procurement Policy Act.

Sec. 4074. Small Business Act.

PART V—REVISION OF REGULATIONS

Sec. 4081. Revision required.

Subtitle B—Socioeconomic and Small Business Laws

Sec. 4101. Armed services acquisitions.

Sec. 4102. Acquisitions generally.

Sec. 4103. Acquisitions from small businesses.

Sec. 4104. Contracting program for certain small business concerns.
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Subtitle C—Miscellaneous Acquisition Laws

Sec. 4151. Prohibition on use of funds for documenting economic or employment

impact of certain acquisition programs.

Sec. 4152. Restriction on use of noncompetitive procedures for procurement from

a particular source.

TITLE V—ACQUISITION MANAGEMENT

Subtitle A—Armed Services Acquisitions

Sec. 5001. Performance based management.

Sec. 5002. Results oriented acquisition program cycle.

Sec. 5003. Defense acquisition pilot program designations.

Subtitle B—Civilian Agency Acquisitions

Sec. 5051. Performance based management.

Sec. 5052. Results-oriented acquisition process.

Subtitle C—Miscellaneous

Sec. 5091. Contractor exceptional performance awards.

Sec. 5092. Department of Defense acquisition of intellectual property rights.

TITLE VI—STANDARDS OF CONDUCT

Subtitle A—Ethics Provisions

Sec. 6001. Amendments to Office of Federal Procurement Policy Act.

Sec. 6002. Amendments to title 18, United States Code.

Sec. 6003. Repeal of superseded and obsolete laws.

Sec. 6004. Implementation.

Subtitle B—Additional Amendments

Sec. 6051. Contracting functions performed by Federal personnel.

Sec. 6052. Repeal of executed requirement for study and report.

Sec. 6053. Interests of Members of Congress.

Sec. 6054. Waiting period for significant changes proposed for acquisition regulations.

Subtitle C—Whistleblower Protection

Sec. 6101. Armed services procurements.

Sec. 6102. Governmentwide whistleblower protections for contractor employees.

TITLE VII—DEFENSE TRADE AND COOPERATION

Sec. 7001. Purchases of foreign goods.

Sec. 7002. International cooperative agreements.

Sec. 7003. Acquisition, cross-servicing agreements, and standardization.

TITLE VIII—COMMERCIAL ITEMS

Sec. 8001. Definitions.

Sec. 8002. Preference for acquisition of commercial items and nondevelopmental

items.

Sec. 8003. Acquisition of commercial items.

Sec. 8004. Class waiver of applicability of certain laws.
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Sec. 8005. Inapplicability of certain provisions of law.

Sec. 8006. Flexible deadlines for submission of offers of commercial items.

Sec. 8007. Advocates for acquisition of commercial and nondevelopmental items.

Sec. 8008. Provisions not affected.

Sec. 8009. Comptroller General review of Federal Government use of market research.

TITLE IX—EFFECTIVE DATES AND IMPLEMENTATION

Sec. 9001. Effective dates.

Sec. 9002. Implementing regulations.

Sec. 9003. Evaluation by the Comptroller General.

Sec. 9004. Data collection through the Federal procurement data system.

1 TITLE I—CONTRACT FORMATION

2 Subtitle A—Competition Statutes

3 PART I—ARMED SERVICES ACQUISITIONS

4 Subpart A—Competition Requirements

5 SEC. 1001. REFERENCES TO FEDERAL ACQUISITION REGU6 LATION.

7 Section 2304 of title 10, United States Code, is amend8 ed—

9 (1) in subsection (a)(1)(A), by striking out

10 ‘‘modifications’’ and all that follows through ‘‘note)’’

11 and inserting in lieu thereof ‘‘Federal Acquisition

12 Regulation’’; and

13 (2) in subsection (g)(1), by striking out ‘‘regula14 tions modified’’ and all that follows through ‘‘note)’’

15 and inserting in lieu thereof ‘‘Federal Acquisition

16 Regulation’’.
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1 SEC. 1002. ESTABLISHMENT OR MAINTENANCE OF ALTER2 NATIVE SOURCES OF SUPPLY.

3 Section 2304(b) of title 10, United States Code, is

4 amended—

5 (1) in paragraph (1)—

6 (A) by striking out ‘‘or’’ at the end of sub7 paragraph (B);

8 (B) by striking out the period at the end of

9 subparagraph (C) and inserting in lieu thereof a

10 semicolon; and

11 (C) by adding at the end the following new

12 subparagraphs:

13 ‘‘(D) would ensure the continuous availability of

14 a reliable source of supply of such property or service;

15 ‘‘(E) would satisfy projected needs for such prop16 erty or service determined on the basis of a history of

17 high demand for the property or service; or

18 ‘‘(F) in the case of medical supplies, safety sup19 plies, or emergency supplies, would satisfy a critical

20 need for such supplies.’’;

21 (2) by redesignating paragraphs (2) and (3) as

22 paragraphs (3) and (4), respectively;

23 (3) by inserting after paragraph (1) the follow24 ing new paragraph (2):
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1 ‘‘(2) The determination required of the agency head

2 in paragraph (1) may not be made for a class of purchases

3 or contracts.’’; and

4 (4) in paragraph (4), as redesignated by para5 graph (2), by striking out ‘‘paragraphs (1) and (2)’’

6 and inserting in lieu thereof ‘‘paragraphs (1) and

7 (3)’’.

8 SEC. 1003. CLARIFICATION OF APPROVAL AUTHORITY FOR

9 USE OF PROCEDURES OTHER THAN FULL

10 AND OPEN COMPETITION.

11 Section 2304(f)(1)(B)(i) of title 10, United States

12 Code, is amended by inserting before the semicolon at the

13 end the following: ‘‘or by an official referred to in clause

14 (ii), (iii), or (iv)’’.

15 SEC. 1004. TASK ORDER CONTRACTS FOR ADVISORY AND

16 ASSISTANCE SERVICES.

17 (a) AUTHORITY.—

18 (1) IN GENERAL.—Chapter 137 of title 10,

19 United States Code, is amended by inserting after sec20 tion 2304 the following new section:

21 ‘‘§ 2304a. Task order contracts for advisory and assist22 ance services

23 ‘‘(a) AUTHORITY TO AWARD.—(1) Subject to the re24 quirements of this section, the head of an agency may enter

25 into a contract for advisory and assistance services that
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1 does not procure or specify a firm quantity of services (other

2 than a minimum or maximum quantity) and that provides

3 for the issuance of task orders during the specified period

4 of the contract.

5 ‘‘(2) Except as provided in subsection (h), the head of

6 an agency may enter into a contract described in para7 graph (1) only under the authority of this section.

8 ‘‘(b) LIMITATION ON CONTRACT PERIOD.—The period

9 of a contract referred to in subsection (a), including all pe10 riods of extensions of the contract under options, modifica11 tions, or otherwise, may not exceed 5 years unless a longer

12 period is specifically authorized in a law that is applicable

13 to such contract.

14 ‘‘(c) CONTRACT PROCEDURES.—(1) The head of an

15 agency may use procedures other than competitive proce16 dures to enter into a contract referred to in subsection (a)

17 only if an exception in subsection (c) of section 2304 of this

18 title applies to the contract and the use of such procedures

19 is approved in accordance with subsection (f) of such sec20 tion.

21 ‘‘(2) The notice required by section 18 of the Office

22 of Federal Procurement Policy Act (41 U.S.C. 416) and sec23 tion 8(e) of the Small Business Act (15 U.S.C. 637(e)) shall

24 reasonably and fairly describe the general scope, magnitude,

25 and duration of the proposed contract in a manner that
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1 would reasonably enable a potential offeror to decide wheth2 er to request the solicitation and consider submitting an

3 offer.

4 ‘‘(3) The solicitation shall include the following:

5 ‘‘(A) The period of the contract, including the

6 number of options to extend the contract and the pe7 riod for which the contract may be extended under

8 each option, if any.

9 ‘‘(B) The maximum quantity or dollar value of

10 services to be procured under the contract.

11 ‘‘(C) A statement of work, specifications, or other

12 description that reasonably describes the general

13 scope, nature, complexity, and purposes of the services

14 to be procured under the contract.

15 ‘‘(4)(A) The head of an agency may, on the basis of

16 one solicitation, award separate contracts under this section

17 for the same or similar services to two or more sources if

18 the solicitation states that the head of the agency has the

19 option to do so.

20 ‘‘(B) If, in the case of a contract for advisory and as21 sistance services to be entered into under the authority of

22 this section, the contract period is to exceed 3 years and

23 the contract amount is estimated to exceed $10,000,000 (in24 cluding all options), the solicitation shall—
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1 ‘‘(i) provide for a multiple award authorized

2 under subparagraph (A); and

3 ‘‘(ii) include a statement that the head of the

4 agency may also elect to award only one contract if

5 the head of the agency determines in writing that

6 only one of the offerers is capable of providing the

7 services required at the level of quality required.

8 ‘‘(C) Subparagraph (B) does not apply in the case of

9 a solicitation for which the head of an agency determines

10 in writing that, because the services required under the con11 tract are unique or highly specialized, it is not practicable

12 to award more than one contract.

13 ‘‘(5) A contract referred to in subsection (a) shall con14 tain the same information that is required by paragraph

15 (3) to be included in the solicitation of offers for that con16 tract.

17 ‘‘(d) ORDER PROCEDURES.—(1) The following actions

18 are not required for a task order issued under a contract

19 entered into in accordance with this section:

20 ‘‘(A) A separate notice for such order under sec21 tion 18 of the Office of Federal Procurement Policy

22 Act (41 U.S.C. 416) or section 8(e) of the Small Busi23 ness Act (15 U.S.C. 637(e)).

24 ‘‘(B) Except as provided in paragraph (2), a

25 competition (or a waiver of competition approved in
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1 accordance with section 2304(f) of this title) that is

2 separate from that used for entering into the contract.

3 ‘‘(2)(A) When multiple contracts are awarded pursu4 ant to subsection (c)(4), all contractors awarded such con5 tracts shall be provided a fair opportunity to be considered,

6 pursuant to procedures set forth in the contracts, for each

7 task order in excess of $2,500 that is to be issued under

8 any of the contracts unless—

9 ‘‘(i) the agency’s need for the services ordered is

10 of such unusual urgency that competition would re11 sult in unacceptable delays in fulfilling the agency’s

12 needs;

13 ‘‘(ii) only one such contractor is capable of pro14 viding the services required at the level of quality re15 quired because the services ordered are unique or so

16 highly specialized;

17 ‘‘(iii) the task order should be issued on a sole18 source basis in the interest of economy and efficiency

19 because it is a logical follow-on to a task order al20 ready issued on a competitive basis; or

21 ‘‘(iv) the order must be placed with a particular

22 contractor in order to satisfy a minimum guarantee.

23 ‘‘(B) When a task order is issued in accordance with

24 subparagraph (A), the order shall include a statement of
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1 work that clearly specifies all tasks to be performed under

2 the order.

3 ‘‘(3) A protest is not authorized in connection with the

4 issuance or proposed issuance of a task order except for a

5 protest on the ground that the order increases the scope, pe6 riod, or maximum value of the contract under which the

7 order is issued.

8 ‘‘(e) INCREASES IN SCOPE, PERIOD, OR MAXIMUM

9 VALUE OF CONTRACT.—(1) A task order may not increase

10 the scope, period, or maximum value of the contract under

11 which the order is issued. The scope, period, or maximum

12 value of the contract may be increased only by modification

13 of the contract.

14 ‘‘(2) Unless use of procedures other than competitive

15 procedures is authorized by an exception in subsection (c)

16 of section 2304 of this title and approved in accordance

17 with subsection (f) of such section, competitive procedures

18 shall be used for making such a modification.

19 ‘‘(3) Notice regarding the modification shall be pro20 vided in accordance with section 18 of the Office of Federal

21 Procurement Policy Act (41 U.S.C. 416) and section 8(e)

22 of the Small Business Act (15 U.S.C. 637(e)).

23 ‘‘(4)(A) Notwithstanding the limitation on the contract

24 period set forth in subsection (b) or in a solicitation or con25 tract pursuant to subsection (c), a contract entered into by
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1 the head of an agency under this section may be extended

2 on a sole-source basis for a period not exceeding 6 months

3 if the agency head determines that—

4 ‘‘(i) the award of a follow-on contract has been

5 delayed by circumstances that were not reasonably

6 foreseeable at the time the initial contract was entered

7 into; and

8 ‘‘(ii) the extension is necessary in order to ensure

9 continuity of the receipt of services pending the

10 award of, and commencement of performance under,

11 the follow-on contract.

12 ‘‘(B) A contract may be extended under the authority

13 of subparagraph (A) only once and only in accordance with

14 the limitations and requirements of this subsection.

15 ‘‘(f) TASK ORDER OMBUDSMAN.—Each head of an

16 agency who awards multiple contracts pursuant to sub17 section (c)(4) shall appoint or designate a task order om18 budsman who shall be responsible for reviewing complaints

19 from the contractors on such contracts and ensuring that

20 all of the contractors are afforded a fair opportunity to be

21 considered for task orders when required under subsection

22 (d)(2). The task order ombudsman shall be a senior agency

23 official who is independent of the contracting officer for the

24 contracts and may be the agency’s competition advocate.
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1 ‘‘(g) INAPPLICABILITY TO CERTAIN CONTRACTS.—This

2 section does not apply to a contract for the acquisition of

3 property or services that includes acquisition of advisory

4 and assistance services if the head of an agency entering

5 into such contract determines that, under the contract, advi6 sory and assistance services are necessarily incident to, and

7 not a significant component of, the contract.

8 ‘‘(h) RELATIONSHIP TO OTHER CONTRACTING AU9 THORITY.—Nothing in this section may be construed to

10 limit the authority of the head of an agency to enter into

11 single or multiple task order contracts, or single or multiple

12 delivery order contracts, for property or services (other than

13 advisory and assistance services) under other provisions of

14 this chapter or under any other provision of law.

15 ‘‘(i) ADVISORY AND ASSISTANCE SERVICES DE16 FINED.—In this section, the term ‘advisory and assistance

17 services’ has the meaning given such term in section 1105(g)

18 of title 31.’’.

19 (2) CLERICAL AMENDMENT.—The table of sec20 tions at the beginning of such chapter is amended by

21 inserting after the item relating to section 2304 the

22 following new item:

‘‘2304a. Task order contracts for advisory and assistance services.’’.

23 (b) REPEAL OF SUPERSEDED PROVISION.—Section

24 2304 of title 10, United States Code, is amended by striking

25 out subsection (j).
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1 (c) CONFORMING AMENDMENT FOR PROFESSIONAL

2 AND TECHNICAL SERVICES.—Section 2331 of title 10,

3 United States Code, is amended by striking out subsection

4 (c).

5 SEC. 1005. ACQUISITION OF EXPERT SERVICES.

6 Section 2304(c)(3) of title 10, United States Code, is

7 amended—

8 (1) by striking out ‘‘or (B)’’ and inserting in

9 lieu thereof ‘‘(B)’’; and

10 (2) by inserting before the semicolon at the end

11 the following: ‘‘, or (C) to procure the services of an

12 expert for use, in any litigation or dispute (including

13 any reasonably foreseeable litigation or dispute) in14 volving the Federal Government, in any trial, hear15 ing, or proceeding before any court, administrative

16 tribunal, or agency, or in any part of an alternative

17 dispute resolution process, whether or not the expert

18 is expected to testify’’.

19 Subpart B—Planning, Solicitation, Evaluation, and

20 Award

21 SEC. 1011. SOURCE SELECTION FACTORS.

22 Section 2305(a) of title 10, United States Code, is

23 amended—

24 (1) in paragraph (2)—
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1 (A) in subparagraph (A)(i), by striking out

2 ‘‘nonprice-related factors)’’ and inserting in lieu

3 thereof ‘‘nonprice-related factors and

4 subfactors)’’; and

5 (B) in subparagraph (B)(ii), by striking

6 out subclause (I) and inserting in lieu thereof the

7 following:

8 ‘‘(I) either a statement that the propos9 als are intended to be evaluated with, and

10 award made after, discussions with the

11 offerors, or a statement that the proposals

12 are intended to be evaluated, and award

13 made, without discussions with the offerors

14 (other than discussions conducted for the

15 purpose of minor clarification) unless dis16 cussions are determined to be necessary;

17 and’’; and

18 (2) by striking out paragraph (3) and inserting

19 in lieu thereof the following:

20 ‘‘(3)(A) In prescribing the evaluation factors to be in21 cluded in each solicitation for competitive proposals, the

22 head of an agency—

23 ‘‘(i) shall clearly establish the relative impor24 tance assigned to the evaluation factors and

25 subfactors, including the quality of the product or
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1 services to be provided (including technical capabil2 ity, management capability, prior experience, and

3 past performance of the offeror);

4 ‘‘(ii) shall include cost or price to the Govern5 ment as an evaluation factor that must be considered

6 in the evaluation of proposals; and

7 ‘‘(iii) shall disclose to offerors whether all evalua8 tion factors other than cost or price, when combined,

9 are—

10 ‘‘(I) significantly more important than cost

11 or price;

12 ‘‘(II) approximately equal in importance to

13 cost or price; or

14 ‘‘(III) significantly less important than cost

15 or price.

16 ‘‘(B) Nothing in this paragraph prohibits an agency

17 from—

18 ‘‘(i) providing additional information in a solic19 itation, including numeric weights for all evaluation

20 factors; or

21 ‘‘(ii) stating in a solicitation that award will be

22 made to the offeror that meets the solicitation’s man23 datory requirements at the lowest cost or price.’’.
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1 SEC. 1012. SOLICITATION PROVISION REGARDING EVALUA2 TION OF PURCHASE OPTIONS.

3 (a) OPTIONS FOR ADDITIONAL PURCHASES.—Sub4 section (a) of section 2305 of title 10, United States Code,

5 as amended by section 1011, is further amended by adding

6 at the end the following new paragraph:

7 ‘‘(4) The head of an agency, in issuing a solicitation

8 for a contract to be awarded using sealed bid procedures,

9 may not include in such solicitation a clause providing for

10 the evaluation of prices for options to purchase additional

11 property or services under the contract unless the head of

12 the agency has determined that there is a reasonable likeli13 hood that the options will be exercised.’’.

14 (b) REPEAL OF SUPERSEDED PROVISION.—Section

15 2301(a) of such title is amended—

16 (1) by striking out paragraph (7);

17 (2) by inserting ‘‘and’’ at the end of paragraph

18 (5); and

19 (3) by striking out ‘‘; and’’ at the end of para20 graph (6) and inserting in lieu thereof a period.

21 SEC. 1013. PROMPT NOTICE OF AWARD.

22 (a) SEALED BID PROCEDURES.—Section 2305(b)(3) of

23 title 10, United States Code, is amended by adding at the

24 end the following: ‘‘As soon as practicable after the date

25 of contract award, the head of the agency shall, in accord26 ance with procedures prescribed in the Federal Acquisition
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1 Regulation, notify all offerors not awarded the contract that

2 the contract has been awarded.’’.

3 (b) COMPETITIVE PROPOSALS PROCEDURES.—Section

4 2305(b)(4)(B) of title 10, United States Code, is amended

5 in the second sentence by striking out ‘‘source and shall

6 promptly notify’’ and inserting in lieu thereof ‘‘source. As

7 soon as practicable after the date of contract award, the

8 head of the agency shall, in accordance with procedures pre9 scribed in the Federal Acquisition Regulation, notify’’.

10 SEC. 1014. POST-AWARD DEBRIEFINGS.

11 Section 2305(b) of title 10, United States Code, is

12 amended—

13 (1) by redesignating paragraph (5) as para14 graph (6); and

15 (2) by inserting after paragraph (4) the follow16 ing new paragraph (5):

17 ‘‘(5)(A) When a contract is awarded by the head of

18 an agency on the basis of competitive proposals, an unsuc19 cessful offeror, upon written request received by the agency

20 within 3 days after the date on which the unsuccessful

21 offeror receives the notification of the contract award, shall

22 be debriefed and furnished the basis for the selection deci23 sion and contract award. An employee of the agency shall

24 debrief the offeror promptly after receipt of the request by

25 the agency.
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1 ‘‘(B) The debriefing shall include, at a minimum—

2 ‘‘(i) the agency’s evaluation of the significant

3 weak or deficient factors in the offeror’s offer;

4 ‘‘(ii) the overall evaluated cost and technical rat5 ing of the offer of the contractor awarded the contract

6 and the overall evaluated cost and technical rating of

7 the offer of the debriefed offeror;

8 ‘‘(iii) the overall ranking of all offers;

9 ‘‘(iv) a summary of the rationale for the award;

10 ‘‘(v) in the case of a proposal that incorporates

11 equipment that is a commercial item, the make and

12 model of the item incorporated in the offer of the con13 tractor awarded the contract; and

14 ‘‘(vi) reasonable responses to questions posed by

15 the debriefed offeror as to whether source selection

16 procedures set forth in the solicitation, applicable reg17 ulations, and other applicable authorities were fol18 lowed by the agency.

19 ‘‘(C) The debriefing may not include point-by-point

20 comparisons of the debriefed offeror’s offer with other offers

21 and may not disclose any information that is exempt from

22 disclosure under section 552 of title 5, including informa23 tion relating to—

24 ‘‘(i) trade secrets;
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1 ‘‘(ii) privileged or confidential manufacturing

2 processes and techniques; and

3 ‘‘(iii) commercial and financial information that

4 is privileged or confidential, including cost break5 downs, profit, indirect cost rates, and similar infor6 mation.

7 ‘‘(D) Each solicitation for competitive proposals shall

8 include a statement that information described in subpara9 graph (B) may be disclosed in post-award debriefings.

10 ‘‘(E) If, within one year after the date of the contract

11 award and as a result of a successful procurement protest

12 or otherwise, the agency seeks to fulfill the requirement

13 under the contract either on the basis of a new solicitation

14 of offers or on the basis of new best and final offers requested

15 for that contract, the agency shall make available to all

16 offerors—

17 ‘‘(i) the information provided in debriefings

18 under this paragraph regarding the offer of the con19 tractor awarded the contract; and

20 ‘‘(ii) the comparable debriefing information that

21 was prepared with respect to the original offerors.

22 ‘‘(F) The contracting officer shall include a summary

23 of the debriefing in the contract file.’’.
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1 SEC. 1015. PROTEST FILE.

2 Section 2305 of title 10, United States Code, is amend3 ed by adding at the end the following:

4 ‘‘(e)(1) If, in the case of a solicitation for a contract

5 issued by, or an award or proposed award of a contract

6 by, the head of an agency, a protest is filed pursuant to

7 the procedures in subchapter V of chapter 35 of title 31 and

8 an actual or prospective offeror so requests, a file of the

9 protest shall be established by the procuring activity and

10 reasonable access shall be provided to actual or prospective

11 offerors.

12 ‘‘(2) Information exempt from disclosure under the sec13 tion 552 of title 5 may be redacted in a file established

14 pursuant to paragraph (1) unless an applicable protective

15 order provides otherwise.

16 ‘‘(3) Regulations implementing this subsection shall be

17 consistent with the regulations regarding the preparation

18 and submission of an agency’s protest file (the so-called

19 ‘rule 4 file’) for protests to the General Services Board of

20 Contract Appeals under section 111 of the Federal Property

21 and Administrative Services Act of 1949 (41 U.S.C. 759).’’.

22 SEC. 1016. AWARD OF COSTS AND FEES IN AGENCY SETTLE23 MENT OF PROTESTS.

24 Section 2305 of title 10, United States Code, as amend25 ed by section 1015, is further amended by adding at the

26 end the following new subsection:
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1 ‘‘(f) If, in connection with a protest, the head of an

2 agency determines that a solicitation, proposed award, or

3 award does not comply with the requirements of law or reg4 ulation, the head of the agency may take—

5 ‘‘(1) any action set out in subparagraphs (A)

6 through (F) of subsection (b)(1) of section 3554 of title

7 31; and

8 ‘‘(2) may pay costs described in paragraph (1)

9 of section 3554(c) of title 31 within the limits referred

10 to in paragraph (2) of such section.’’.

11 SEC. 1017. TWO-PHASE SELECTION PROCEDURES.

12 (a) PROCEDURES AUTHORIZED.—Chapter 137 of title

13 10, United States Code, is amended by inserting after sec14 tion 2305 the following new section:

15 ‘‘§ 2305a. Two-phase selection procedures

16 ‘‘(a) PROCEDURES AUTHORIZED.—The head of an

17 agency may use two-phase selection procedures for entering

18 into a contract for the acquisition of property or services

19 when the head of the agency determines that three or more

20 offers will be received for such contract, substantial design

21 work must be performed before an offeror can develop a

22 price or cost proposal for such contract, and the offerors

23 will incur a substantial amount of expenses in preparing

24 the offers.
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1 ‘‘(b) PROCEDURES DESCRIBED.—Two-phase selection

2 procedures consist of the following:

3 ‘‘(1) The head of the agency solicits proposals

4 that—

5 ‘‘(A) include information on the offerors’—

6 ‘‘(i) technical approach; and

7 ‘‘(ii) technical qualifications; and

8 ‘‘(B) do not include—

9 ‘‘(i) detailed design information; or

10 ‘‘(ii) cost or price information.

11 ‘‘(2) The head of the agency evaluates the propos12 als on the basis of evaluation criteria set forth in the

13 solicitation, except that the head of the agency does

14 not consider cost-related or price-related evaluation

15 factors.

16 ‘‘(3) The head of the agency selects at least three

17 offerors as the most highly qualified to provide the

18 property or services under the contract and requests

19 the selected offerors to submit competitive proposals

20 that include cost or price information.

21 ‘‘(4) The head of the agency awards the contract

22 in accordance with section 2305(b)(4) of this title.

23 ‘‘(c) RESOURCE COMPARISON CRITERION RE24 QUIRED.—In using two-phase selection procedures for enter25 ing into a contract, the head of the agency shall establish
29

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1 a resource criterion or a financial criterion applicable to

2 the contract in order to provide a consistent basis for com3 paring the offerors and their proposals.

4 ‘‘(d) TWO-PHASE SELECTION PROCEDURES DE5 FINED.—In this section, the term ‘two-phase selection proce6 dures’ means procedures described in subsection (b) that are

7 used for the selection of a contractor on the basis of cost

8 or price and other evaluation criteria to provide property

9 or services in accordance with the provisions of a contract

10 which requires the contractor to design the property to be

11 acquired under the contract and produce or construct such

12 property.

13 ‘‘(e) APPLICABILITY ONLY TO DEPARTMENT OF DE14 FENSE.—This section does not apply to the Coast Guard

15 or the National Aeronautics and Space Administration.’’.

16 (b) CLERICAL AMENDMENT.—The table of sections at

17 the beginning of such chapter is amended by inserting after

18 the item relating to section 2305 the following:

‘‘2305a. Two-phase selection procedures.’’.

19 Subpart C—Kinds of Contracts

20 SEC. 1021. SECRETARIAL DETERMINATION REGARDING USE

21 OF COST TYPE OR INCENTIVE CONTRACT.

22 Subsection (c) of section 2306 of title 10, United States

23 Code, is repealed.
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1 SEC. 1022. TECHNICAL AND CONFORMING AMENDMENTS.

2 (a) REPEAL OF UNNECESSARY CROSS REFERENCE.—

3 Subsection (f) of section 2306 of title 10, United States

4 Code, is repealed.

5 (b) CONFORMING AMENDMENT.—Such section is

6 amended by redesignating subsections (d), (e), (g), and (h)

7 as subsections (c), (d), (e), and (f), respectively.

8 (c) NEUTERIZATION OF REFERENCE.—Subsection

9 (e)(1) of such section, as redesignated by subsection (b), is

10 amended in the matter above clause (i) by striking out

11 ‘‘whenever he finds’’ and inserting in lieu thereof ‘‘whenever

12 the head of the agency finds’’.

13 Subpart D—Miscellaneous Provisions for the

14 Encouragement of Competition

15 SEC. 1031. REPEAL OF REQUIREMENT FOR ANNUAL REPORT

16 BY ADVOCATES FOR COMPETITION.

17 Subsection (c) of section 2318 of title 10, United States

18 Code, is repealed.

19 PART II—CIVILIAN AGENCY ACQUISITIONS

20 Subpart A—Competition Requirements

21 SEC. 1051. REFERENCES TO FEDERAL ACQUISITION REGU22 LATION.

23 Section 303 of the Federal Property and Administra24 tive Services Act of 1949 (41 U.S.C. 253) is amended—

25 (1) in subsection (a)(1)(A), by striking out

26 ‘‘modifications’’ and all that follows through ‘‘of
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1 1984’’ and inserting in lieu thereof ‘‘Federal Acquisi2 tion Regulation’’; and

3 (2) in subsection (g)(1), by striking out ‘‘regula4 tions modified’’ and all that follows through ‘‘of

5 1984,’’ and inserting in lieu thereof ‘‘Federal Acquisi6 tion Regulation’’.

7 SEC. 1052. ESTABLISHMENT OR MAINTENANCE OF ALTER8 NATIVE SOURCES OF SUPPLY.

9 Section 303(b) of the Federal Property and Adminis10 trative Services Act of 1949 (41 U.S.C. 253(b)) is amend11 ed—

12 (1) in paragraph (1)—

13 (A) by striking out ‘‘or’’ at the end of sub14 paragraph (B);

15 (B) by striking out the period at the end of

16 subparagraph (C) and inserting in lieu thereof a

17 semicolon; and

18 (C) by adding at the end the following new

19 subparagraphs:

20 ‘‘(D) would ensure the continuous availability of

21 a reliable source of supply of such property or service;

22 ‘‘(E) would satisfy projected needs for such prop23 erty or service determined on the basis of a history of

24 high demand for the property or service; or
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1 ‘‘(F) in the case of medical supplies, safety sup2 plies, or emergency supplies, would satisfy a critical

3 need for such supplies.’’;

4 (2) by redesignating paragraphs (2) and (3) as

5 paragraphs (3) and (4), respectively;

6 (3) by inserting after paragraph (1) the follow7 ing new paragraph (2):

8 ‘‘(2) The determination required of the agency head

9 in paragraph (1) may not be made for a class of purchases

10 or contracts.’’; and

11 (4) in paragraph (4), as redesignated by para12 graph (2), by striking out ‘‘paragraphs (1) and (2)’’

13 and inserting in lieu thereof ‘‘paragraphs (1) and

14 (3)’’.

15 SEC. 1053. CLARIFICATION OF APPROVAL AUTHORITY FOR

16 USE OF PROCEDURES OTHER THAN FULL

17 AND OPEN COMPETITION.

18 Section 303(f)(1)(B)(i) of the Federal Property and

19 Administrative Services Act of 1949 (41 U.S.C.

20 253(f)(1)(B)(i)) is amended by inserting before the semi21 colon at the end the following: ‘‘or by an official referred

22 to in clause (ii), (iii), or (iv)’’.
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1 SEC. 1054. TASK ORDER CONTRACTS FOR ADVISORY AND

2 ASSISTANCE SERVICES.

3 (a) AUTHORITY.—Title III of the Federal Property

4 and Administrative Services Act of 1949 (41 U.S.C. 251

5 et seq.) is amended by inserting after section 303G the fol6 lowing new section:

7 ‘‘TASK ORDER CONTRACTS FOR ADVISORY AND ASSISTANCE

8 SERVICES

9 ‘‘SEC. 303H. (a) AUTHORITY TO AWARD.—(1) Subject

10 to the requirements of this section, the head of an executive

11 agency may enter into a contract for advisory and assist12 ance services that does not procure or specify a firm quan13 tity of services (other than a minimum or maximum quan14 tity) and that provides for the issuance of task orders dur15 ing the specified period of the contract.

16 ‘‘(2) Except as provided in subsection (h), the agency

17 head may enter into a contract described in paragraph (1)

18 only under the authority of this section.

19 ‘‘(b) LIMITATION ON CONTRACT PERIOD.—The period

20 of a contract referred to in subsection (a), including all pe21 riods of extensions of the contract under options, modifica22 tions, or otherwise, may not exceed 5 years unless a longer

23 period is specifically authorized in a law that is applicable

24 to such contract.

25 ‘‘(c) CONTRACT PROCEDURES.—(1) An agency head

26 may use procedures other than competitive procedures to
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1 enter into a contract referred to in subsection (a) only if

2 an exception in subsection (c) of section 303 applies to the

3 contract and the use of such procedures is approved in ac4 cordance with subsection (f) of such section.

5 ‘‘(2) The notice required by section 18 of the Office

6 of Federal Procurement Policy Act (41 U.S.C. 416) and sec7 tion 8(e) of the Small Business Act (15 U.S.C. 637(e)) shall

8 reasonably and fairly describe the general scope, magnitude,

9 and duration of the proposed contract in a manner that

10 would reasonably enable a potential offeror to decide wheth11 er to request the solicitation and consider submitting an

12 offer.

13 ‘‘(3) The solicitation shall include the following:

14 ‘‘(A) The period of the contract, including the

15 number of options to extend the contract and the pe16 riod for which the contract may be extended under

17 each option, if any.

18 ‘‘(B) The maximum quantity or dollar value of

19 the services to be procured under the contract.

20 ‘‘(C) A statement of work, specifications, or other

21 description that reasonably describes the general

22 scope, nature, complexity, and purposes of the services

23 to be procured under the contract.

24 ‘‘(4)(A) An agency head may, on the basis of one solici25 tation, award separate contracts under this section for the
35

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1 same or similar services to two or more sources if the solici2 tation states that the agency head has the option to do so.

3 ‘‘(B) If, in the case of a contract for advisory and as4 sistance services to be entered into under the authority of

5 this section, the contract period is to exceed 3 years and

6 the contract amount is estimated to exceed $10,000,000 (in7 cluding all options), the solicitation shall—

8 ‘‘(i) provide for a multiple award authorized

9 under subparagraph (A); and

10 ‘‘(ii) include a statement that the agency head

11 may also elect to award only one contract if the agen12 cy head determines in writing that only one of the

13 offerers is capable of providing the services required

14 at the level of quality required.

15 ‘‘(C) Subparagraph (B) does not apply in the case of

16 a solicitation for which the agency head determines in writ17 ing that, because the services required under the contract

18 are unique or highly specialized, it is not practicable to

19 award more than one contract.

20 ‘‘(5) A contract referred to in subsection (a) shall con21 tain the same information that is required by paragraph

22 (3) to be included in the solicitation of offers for that con23 tract.
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1 ‘‘(d) ORDER PROCEDURES.—(1) The following actions

2 are not required for a task order issued under a contract

3 entered into in accordance with this section:

4 ‘‘(A) A separate notice for such order under sec5 tion 18 of the Office of Federal Procurement Policy

6 Act (41 U.S.C. 416) or section 8(e) of the Small Busi7 ness Act (15 U.S.C. 637(e)).

8 ‘‘(B) Except as provided in paragraph (2), a

9 competition (or a waiver of competition approved in

10 accordance with section 303(f)) that is separate from

11 that used for entering into the contract.

12 ‘‘(2)(A) When multiple contracts are awarded pursu13 ant to subsection (c)(4), all contractors awarded such con14 tracts shall be provided a fair opportunity to be considered,

15 pursuant to procedures set forth in the contracts, for each

16 task order in excess of $2,500 that is to be issued under

17 any of the contracts unless—

18 ‘‘(i) the agency’s need for the services ordered is

19 of such unusual urgency that competition would re20 sult in unacceptable delays in fulfilling the agency’s

21 needs;

22 ‘‘(ii) only one such contractor is capable of pro23 viding the services required at the level of quality re24 quired because the services ordered are unique or

25 highly specialized;
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1 ‘‘(iii) the task order should be issued on a sole2 source basis in the interest of economy and efficiency

3 because it is a logical follow-on to a task order al4 ready issued on a competitive basis; or

5 ‘‘(iv) the order must be placed with a particular

6 contractor in order to satisfy a minimum guarantee.

7 ‘‘(B) When a task order is issued in accordance with

8 subparagraph (A), the order shall include a statement of

9 work that clearly specifies all tasks to be performed under

10 the order.

11 ‘‘(3) A protest is not authorized in connection with the

12 issuance or proposed issuance of a task order except for a

13 protest on the ground that the order increases the scope, pe14 riod, or maximum value of the contract under which the

15 order is issued.

16 ‘‘(e) INCREASES IN SCOPE, PERIOD, OR MAXIMUM

17 VALUE OF CONTRACT.—(1) A task order may not increase

18 the scope, period, or maximum value of the contract under

19 which the order is issued. The scope, period, or maximum

20 value of the contract may be increased only by modification

21 of the contract.

22 ‘‘(2) Unless use of procedures other than competitive

23 procedures is authorized by an exception in subsection (c)

24 of section 303 and approved in accordance with subsection
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1 (f) of such section, competitive procedures shall be used for

2 making such a modification.

3 ‘‘(3) Notice regarding the modification shall be pro4 vided in accordance with section 18 of the Office of Federal

5 Procurement Policy Act (41 U.S.C. 416) and section 8(e)

6 of the Small Business Act (15 U.S.C. 637(e)).

7 ‘‘(4)(A) Notwithstanding the limitation on the contract

8 period set forth in subsection (b) or in a solicitation or con9 tract pursuant to subsection (c), a contract entered into by

10 the head of an agency under this section may be extended

11 on a sole-source basis for a period not exceeding 6 months

12 if the agency head determines that—

13 ‘‘(i) the award of a follow-on contract has been

14 delayed by circumstances that were not reasonably

15 foreseeable at the time the initial contract was entered

16 into; and

17 ‘‘(ii) the extension is necessary in order to ensure

18 continuity of the receipt of services pending the

19 award of, and commencement of performance under,

20 the follow-on contract.

21 ‘‘(B) A contract may be extended under the authority

22 of subparagraph (A) only once and only in accordance with

23 the limitations and requirements of this subsection.

24 ‘‘(f) TASK ORDER OMBUDSMAN.—Each agency head

25 who awards multiple contracts pursuant to subsection
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1 (c)(4) shall appoint or designate a task order ombudsman

2 who shall be responsible for reviewing complaints from the

3 contractors on such contracts and ensuring that all of the

4 contractors are afforded a fair opportunity to be considered

5 for task orders when required under subsection (d)(2). The

6 task order ombudsman shall be a senior agency official who

7 is independent of the contracting officer for the contracts

8 and may be the agency’s competition advocate.

9 ‘‘(g) INAPPLICABILITY TO CERTAIN CONTRACTS.—This

10 section does not apply to a contract for the acquisition of

11 property or services that includes acquisition of advisory

12 and assistance services if the agency head entering into such

13 contract determines that, under the contract, advisory and

14 assistance services are necessarily incident to, and not a

15 significant component of, the contract.

16 ‘‘(h) RELATIONSHIP TO OTHER CONTRACTING AU17 THORITY.—Nothing in this section may be construed to

18 limit the authority of the head of an agency to enter into

19 single or multiple task order contracts, or single or multiple

20 delivery order contracts, for goods or services (other than

21 advisory and assistance services) under other provisions of

22 this title or under any other provision of law.

23 ‘‘(i) ADVISORY AND ASSISTANCE SERVICES DE24 FINED.—In this section, the term ‘advisory and assistance
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1 services’ has the meaning given such term in section 1105(g)

2 of title 31, United States Code.’’.

3 (b) CLERICAL AMENDMENT.—The table of contents in

4 the first section is amended by inserting after the item relat5 ing to section 303G the following new item:

‘‘Sec. 303H. Task order contracts for advisory and assistance services.’’.

6 SEC. 1055. ACQUISITION OF EXPERT SERVICES.

7 (a) EXCEPTION TO REQUIREMENT FOR USE OF COM8 PETITIVE PROCEDURES.—Section 303(c)(3) of the Federal

9 Property and Administrative Services Act of 1949 (41

10 U.S.C. 253(c)) is amended—

11 (1) by striking out ‘‘or (B)’’ and inserting in

12 lieu thereof ‘‘(B)’’; and

13 (2) by inserting before the semicolon at the end

14 the following: ‘‘, or (C) to procure the services of an

15 expert for use, in any litigation or dispute (including

16 any reasonably foreseeable litigation or dispute) in17 volving the Federal Government, in any trial, hear18 ing, or proceeding before any court, administrative

19 tribunal, or agency, or in any part of an alternative

20 dispute resolution process, whether or not the expert

21 is expected to testify’’.

22 (b) PROCUREMENT NOTICE.—

23 (1) AMENDMENT OF OFFICE OF FEDERAL PRO24 CUREMENT POLICY ACT.—Section 18(c) of the Office
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1 of Federal Procurement Policy Act (41 U.S.C. 416(c))

2 is amended—

3 (A) by striking out ‘‘or’’ at the end of sub4 paragraph (D);

5 (B) by striking out the period at the end of

6 subparagraph (E) and inserting in lieu thereof

7 ‘‘; or’’; and

8 (C) by adding at the end the following:

9 ‘‘(F) the procurement is for the services of an ex10 pert for use in any litigation or dispute (including

11 any reasonably foreseeable litigation or dispute) in12 volving the Federal Government in any trial, hearing,

13 or proceeding before any court, administrative tribu14 nal, or agency, or in any part of an alternative dis15 pute resolution process, whether or not the expert is

16 expected to testify.’’.

17 (2) AMENDMENT OF SMALL BUSINESS ACT.—Sec18 tion 8(g) of the Small Business Act (15 U.S.C.

19 637(c)) is amended—

20 (A) by striking out ‘‘or’’ at the end of sub21 paragraph (D);

22 (B) by striking out the period at the end of

23 subparagraph (E) and inserting in lieu thereof

24 ‘‘; or’’; and

25 (C) by adding at the end the following:
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1 ‘‘(F) the procurement is for the services of an ex2 pert for use in any litigation or dispute (including

3 preparation for any foreseeable litigation or dispute)

4 that involves or could involve the Federal Government

5 in any trial, hearing, or proceeding before any court,

6 administrative tribunal, or agency, or in any part of

7 an alternative dispute resolution process, whether or

8 not the expert is expected to testify.’’.

9 (c) REPEAL OF AMENDMENTS TO UNCODIFIED

10 TITLE.—The following provisions of law are repealed:

11 (1) Section 532 of Public Law 101–509 (104

12 Stat. 1470) and the provision of law set out in quotes

13 in that section.

14 (2) Section 529 of Public Law 102–393 (106

15 Stat. 1761) and the matters inserted and added by

16 that section.

17 SEC. 1056. CONTINUED OCCUPANCY OF LEASED SPACE.

18 Section 303(d) of the Federal Property and Adminis19 trative Services Act of 1949 (41 U.S.C. 253(d)) is amend20 ed—

21 (1) by redesignating paragraph (2) as para22 graph (3); and

23 (2) by inserting after paragraph (1) the follow24 ing new paragraph (2):
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1 ‘‘(2)(A) For the purposes of applying subsection (c)(1)

2 in the case of a follow-on lease to be entered into for the

3 purpose of providing for continued occupancy of particular

4 space in leased real property by a Federal agency, space

5 may be treated as being available only from the lessor of

6 such space and may be acquired through the use of proce7 dures other than competitive procedures (without the jus8 tification otherwise required by subsection (f)) if a written

9 determination is made by the contracting officer that—

10 ‘‘(i) the occupying agency has a continuing need

11 for the space;

12 ‘‘(ii) the space meets the needs of the agency; and

13 ‘‘(iii) the lessor is willing to continue to provide

14 the space at a fair market price determined by the

15 contracting officer on the basis of a market survey or

16 an appraisal conducted in accordance with generally

17 accepted real property appraisal standards.

18 ‘‘(B) The authority under subparagraph (A) to use

19 procedures other than competitive procedures to enter into

20 a follow-on lease may be exercised not more than once to

21 provide for continued occupancy of particular space in real

22 property by a particular Federal agency. The period of such

23 follow-on lease may not exceed 5 years.

24 ‘‘(C) Nothing in this paragraph may be construed to

25 prohibit the use of procedures other than competitive proce-
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1 dures to enter into a follow-on lease of real property for

2 continued occupancy of particular space in real property

3 by a Federal agency when an exception set forth in sub4 section (c) applies and the use of such procedures is justified

5 and approved in accordance with subsection (f).’’.

6 Subpart B—Planning, Solicitation, Evaluation, and

7 Award

8 SEC. 1061. SOLICITATION, EVALUATION, AND AWARD.

9 (a) CONTENT OF SOLICITATION.—Section 303A of the

10 Federal Property and Administrative Services Act of 1949

11 (41 U.S.C. 253a) is amended—

12 (1) in subsection (b)(1)(A)—

13 (A) by inserting ‘‘and significant

14 subfactors’’ after ‘‘all significant factors’’; and

15 (B) by striking out ‘‘(including price)’’ and

16 inserting ‘‘(including cost or price, cost-related

17 or price-related factors and subfactors, and

18 noncost-related or nonprice-related factors and

19 subfactors)’’;

20 (2) in subsection (b)(1)(B), by inserting ‘‘and

21 subfactors’’ after ‘‘factors’’;

22 (3) in subsection (b)(2)(B), by striking out clause

23 (i) and inserting in lieu thereof the following:

24 ‘‘(i) either a statement that the propos25 als are intended to be evaluated with, and
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1 award made after, discussions with the

2 offerors, or a statement that the proposals

3 are intended to be evaluated, and award

4 made, without discussions with the offerors

5 (other than discussions conducted for the

6 purpose of minor clarification) unless dis7 cussions are determined to be necessary;

8 and’’; and

9 (4) by adding at the end the following new sub10 section:

11 ‘‘(c)(1) In prescribing the evaluation factors to be in12 cluded in each solicitation for competitive proposals, an

13 agency head—

14 ‘‘(A) shall clearly establish the relative impor15 tance assigned to the evaluation factors and

16 subfactors, including the quality of the product or

17 services to be provided (including technical capabil18 ity, management capability, prior experience, and

19 past performance of the offeror);

20 ‘‘(B) shall include cost or price to the Govern21 ment as an evaluation factor that must be considered

22 in the evaluation of proposals; and

23 ‘‘(C) shall disclose to offerors whether all evalua24 tion factors other than cost or price, when combined,

25 are—
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1 ‘‘(i) significantly more important than cost

2 or price;

3 ‘‘(ii) approximately equal in importance to

4 cost or price; or

5 ‘‘(iii) significantly less important than cost

6 or price.

7 ‘‘(2) Nothing in this subsection prohibits an agency

8 from—

9 ‘‘(A) providing additional information in a so10 licitation, including numeric weights for all evalua11 tion factors; or

12 ‘‘(B) stating in a solicitation that award will be

13 made to the offeror that meets the solicitation’s man14 datory requirements at the lowest price or cost.’’.

15 (b) EVALUATION AND AWARD.—Section 303B of the

16 Federal Property and Administrative Services Act of 1949

17 (41 U.S.C. 253b) is amended—

18 (1) in subsection (a), by inserting ‘‘, and award

19 a contract,’’ after ‘‘competitive proposals’’;

20 (2) in subsection (c), by inserting ‘‘in accordance

21 with subsection (a)’’ in the second sentence after

22 ‘‘shall evaluate the bids’’; and

23 (3) in subsection (d)—

24 (A) by striking out paragraph (1) and in25 serting in lieu thereof the following:
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1 ‘‘(1) An agency head shall evaluate competitive propos2 als in accordance with subsection (a) and may award a

3 contract—

4 ‘‘(A) after discussions with the offerors, provided

5 that written or oral discussions have been conducted

6 with all responsible offerors who submit proposals

7 within the competitive range; or

8 ‘‘(B) based on the proposals received and without

9 discussions with the offerors (other than discussions

10 conducted for the purpose of minor clarification), pro11 vided that, as required by section 303A(b)(2)(B)(i),

12 the solicitation included a statement that proposals

13 are intended to be evaluated, and award made, with14 out discussions, unless discussions are determined to

15 be necessary.’’;

16 (B) by striking out paragraphs (2) and (3)

17 and by redesignating paragraph (4) as para18 graph (2); and

19 (C) in paragraph (2), as redesignated by

20 subparagraph (B), by inserting ‘‘cost or’’ before

21 ‘‘price’’ in the first sentence.

22 (c) APPLICABILITY.—

23 (1) IN GENERAL.—Except as provided in para24 graph (2), the amendments made by this section shall

25 apply to—
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1 (A) solicitations for sealed bids or competi2 tive proposals issued after the end of the 180-day

3 period beginning on the date of the enactment of

4 this Act; and

5 (B) contracts awarded pursuant to those so6 licitations.

7 (2) AUTHORITY TO APPLY AMENDMENTS

8 EARLY.—The head of an executive agency may apply

9 the amendments made by this section to solicitations

10 issued before the end of the period referred to in para11 graph (1). The head of the executive agency shall pub12 lish in the Federal Register notice of any such earlier

13 date of application at least 10 days before that date.

14 SEC. 1062. SOLICITATION PROVISION REGARDING EVALUA15 TION OF PURCHASE OPTIONS.

16 Section 303A of the Federal Property and Administra17 tive Services Act of 1949 (41 U.S.C. 253a), as amended by

18 section 1061(a)(4), is further amended by adding at the end

19 the following new subsection:

20 ‘‘(d) An agency head, in issuing a solicitation for a

21 contract to be awarded using sealed bid procedures, may

22 not include in such solicitation a clause providing for the

23 evaluation of prices for options to purchase additional

24 property or services under the contract unless the agency
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1 head has determined that there is a reasonable likelihood

2 that the options will be exercised.’’.

3 SEC. 1063. PROMPT NOTICE OF AWARD.

4 (a) SEALED BID PROCEDURES.—Subsection (c) of sec5 tion 303B of the Federal Property and Administrative

6 Services Act of 1949 (41 U.S.C. 253b) is amended by add7 ing at the end the following: ‘‘As soon as practicable after

8 the date of contract award, the agency head shall, in accord9 ance with procedures prescribed in the Federal Acquisition

10 Regulation, notify all offerors not awarded the contract that

11 the contract has been awarded.’’.

12 (b) COMPETITIVE PROPOSALS PROCEDURES.—Para13 graph (2) of section 303B(d) of the Federal Property and

14 Administrative Services Act of 1949 (41 U.S.C. 253b(d)),

15 as redesignated by section 1061(b)(3)(B), is amended in the

16 second sentence by striking out ‘‘source and shall promptly

17 notify’’ and inserting in lieu thereof ‘‘source. As soon as

18 practicable after the date of contract award, the agency

19 head shall, in accordance with procedures prescribed in the

20 Federal Acquisition Regulation, notify’’.

21 SEC. 1064. POST-AWARD DEBRIEFINGS.

22 Section 303B of the Federal Property and Administra23 tive Services Act of 1949 (41 U.S.C. 253b) is amended—

24 (1) by redesignating subsections (e) and (f) as

25 subsections (f) and (g), respectively; and
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1 (2) by inserting after subsection (d) the following

2 new subsection (e):

3 ‘‘(e)(1) When a contract is awarded by the head of an

4 executive agency on the basis of competitive proposals, an

5 unsuccessful offeror, upon written request received by the

6 agency within 3 days after the date on which the unsuccess7 ful offeror receives the notification of the contract award,

8 shall be debriefed and furnished the basis for the selection

9 decision and contract award. An employee of the executive

10 agency shall debrief the offeror promptly after receipt of the

11 request by the agency.

12 ‘‘(2) The debriefing shall include, at a minimum—

13 ‘‘(A) the executive agency’s evaluation of the sig14 nificant weak or deficient factors in the offeror’s offer;

15 ‘‘(B) the overall evaluated cost and technical rat16 ing of the offer of the contractor awarded the contract

17 and the overall evaluated cost and technical rating of

18 the offer of the debriefed offeror;

19 ‘‘(C) the overall ranking of all offers;

20 ‘‘(D) a summary of the rationale for the award;

21 ‘‘(E) in the case of a proposal that incorporates

22 equipment that is a commercial item, the make and

23 model of the item incorporated in the offer of the con24 tractor awarded the contract; and
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1 ‘‘(F) reasonable responses to questions posed by

2 the debriefed offeror as to whether source selection

3 procedures set forth in the solicitation, applicable reg4 ulations, and other applicable authorities were fol5 lowed by the executive agency.

6 ‘‘(3) The debriefing may not include point-by-point

7 comparisons of the debriefed offeror’s offer with other offers

8 and may not disclose any information that is exempt from

9 disclosure under section 552 of title 5, United States Code,

10 including information relating to—

11 ‘‘(A) trade secrets;

12 ‘‘(B) privileged or confidential manufacturing

13 processes and techniques; and

14 ‘‘(C) commercial and financial information that

15 is privileged or confidential, including cost break16 downs, profit, indirect cost rates, and similar infor17 mation.

18 ‘‘(4) Each solicitation for competitive proposals shall

19 include a statement that information described in para20 graph (2) may be disclosed in post-award debriefings.

21 ‘‘(5) If, within one year after the date of the contract

22 award and as a result of a successful procurement protest

23 or otherwise, the executive agency seeks to fulfill the require24 ment under the contract either on the basis of a new solici25 tation of offers or on the basis of new best and final offers
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1 requested for that contract, the agency head shall make

2 available to all offerors—

3 ‘‘(A) the information provided in debriefings

4 under this subsection regarding the offer of the con5 tractor awarded the contract; and

6 ‘‘(B) the comparable debriefing information that

7 was prepared with respect to the original offerors.

8 ‘‘(6) The contracting officer shall include a summary

9 of the debriefing in the contract file.’’.

10 SEC. 1065. PROTEST FILE.

11 Section 303B of the Federal Property and Administra12 tive Services Act of 1949 (41 U.S.C. 253b), as amended by

13 section 1064(1), is further amended by adding at the end

14 the following:

15 ‘‘(h)(1) If, in the case of a solicitation for a contract

16 issued by, or an award or proposed award of a contract

17 by, an agency head, a protest is filed pursuant to the proce18 dures in subchapter V of chapter 35 of title 31, United

19 States Code, and an actual or prospective offeror so re20 quests, a file of the protest shall be established by the procur21 ing activity and reasonable access shall be provided to ac22 tual or prospective offerors.

23 ‘‘(2) Information exempt from disclosure under section

24 552 of title 5, United States Code, may be redacted in a
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1 file established pursuant to paragraph (1) unless an appli2 cable protective order provides otherwise.

3 ‘‘(3) Regulations implementing this subsection shall be

4 consistent with the regulations regarding the preparation

5 and submission of an agency’s protest file (the so-called

6 ‘rule 4 file’) for protests to the General Services Board of

7 Contract Appeals under section 111 of the Federal Property

8 and Administrative Services Act of 1949 (41 U.S.C. 759).’’.

9 SEC. 1066. AWARD OF COSTS AND FEES IN AGENCY SETTLE10 MENT OF PROTESTS.

11 Section 303B of the Federal Property and Administra12 tive Services Act of 1949 (41 U.S.C. 253b), as amended by

13 section 1065, is further amended by adding at the end the

14 following new subsection:

15 ‘‘(i) If, in connection with a protest, an agency head

16 determines that a solicitation, proposed award, or award

17 does not comply with the requirements of law or regulation,

18 the agency head may take—

19 ‘‘(1) any action set out in subparagraphs (A)

20 through (F) of subsection (b)(1) of section 3554 of title

21 31, United States Code; and

22 ‘‘(2) may pay costs described in paragraph (1)

23 of section 3554(c) of such title within the limits re24 ferred to in paragraph (2) of such section.’’.
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1 SEC. 1067. TWO-PHASE SELECTION PROCEDURES.

2 (a) PROCEDURES AUTHORIZED.—Title III of the Fed3 eral Property and Administrative Services Act of 1949 (41

4 U.S.C. 251 et seq.), as amended by section 1054, is further

5 amended by inserting after section 303H the following new

6 section:

7 ‘‘TWO-PHASE SELECTION PROCEDURES

8 ‘‘SEC. 303I. (a) PROCEDURES AUTHORIZED.—The

9 head of an executive agency may use two-phase selection

10 procedures for entering into a contract for the acquisition

11 of property or services when the agency head determines

12 that three or more offers will be received for such contract,

13 substantial design work must be performed before an offeror

14 can develop a price or cost proposal for such contract, and

15 the offerors will incur a substantial amount of expenses in

16 preparing the offers.

17 ‘‘(b) PROCEDURES DESCRIBED.—Two-phase selection

18 procedures consist of the following:

19 ‘‘(1) The agency head solicits proposals that—

20 ‘‘(A) include information on the offerors’—

21 ‘‘(i) technical approach; and

22 ‘‘(ii) technical qualifications; and

23 ‘‘(B) do not include—

24 ‘‘(i) detailed design information; or

25 ‘‘(ii) cost or price information.
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1 ‘‘(2) The agency head evaluates the proposals on

2 the basis of evaluation criteria set forth in the solici3 tation, except that the agency head does not consider

4 cost-related or price-related evaluation factors.

5 ‘‘(3) The agency head selects at least three

6 offerors as the most highly qualified to provide the

7 property or services under the contract and requests

8 the selected offerors to submit competitive proposals

9 that include cost or price information.

10 ‘‘(4) The agency head awards the contract in ac11 cordance with section 303B(d).

12 ‘‘(c) RESOURCE COMPARISON CRITERION RE13 QUIRED.—In using two-phase selection procedures for enter14 ing into a contract, the agency head shall establish a re15 source criterion or a financial criterion applicable to the

16 contract in order to provide a consistent basis for compar17 ing the offerors and their proposals.

18 ‘‘(d) TWO-PHASE SELECTION PROCEDURES DE19 FINED.—In this section, the term ‘two-phase selection proce20 dures’ means procedures described in subsection (b) that are

21 used for the selection of a contractor on the basis of cost

22 or price and other evaluation criteria to provide property

23 or services in accordance with the provisions of a contract

24 which requires the contractor to design the property to be
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1 acquired under the contract and produce or construct such

2 property.’’.

3 (b) CLERICAL AMENDMENT.—The table of contents in

4 the first section of such Act, as amended by section 1054,

5 is further amended by inserting after the item relating to

6 section 303H the following new item:

‘‘Sec. 303I. Two-phase selection procedures.’’.

7 Subpart C—Kinds of Contracts

8 SEC. 1071. AGENCY HEAD DETERMINATION REGARDING USE

9 OF COST TYPE OR INCENTIVE CONTRACT.

10 Section 304(b) of the Federal Property and Adminis11 trative Services Act of 1949 (41 U.S.C. 254(b)) is amended

12 by striking out the second sentence.

13 SEC. 1072. MULTIYEAR CONTRACTING AUTHORITY.

14 (a) AUTHORITY.—Title III of the Federal Property

15 and Administrative Services Act of 1949 (41 U.S.C. 251

16 et seq.), as amended by section 1067, is further amended

17 by inserting after section 303I the following new section:

18 ‘‘MULTIYEAR CONTRACTS

19 ‘‘SEC. 303J. (a) AUTHORITY.—The head of an execu20 tive agency may enter into a multiyear contract for the ac21 quisition of property or services if—

22 ‘‘(1) funds are available and obligated for such

23 contract, for the full period of the contract or for the

24 first fiscal year in which the contract is in effect, and
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1 for the estimated costs associated with any necessary

2 termination of such contract; and

3 ‘‘(2) the agency head determines that—

4 ‘‘(A) the need for the property or services is

5 reasonably firm and continuing over the period

6 of the contract; and

7 ‘‘(B) a multiyear contract will serve the best

8 interests of the United States by encouraging ef9 fective competition or promoting economy in ad10 ministration, performance, and operation of the

11 agency’s programs.

12 ‘‘(b) TERMINATION CLAUSE.—A multiyear contract

13 entered into under the authority of this section shall include

14 a clause that provides that the contract shall be terminated

15 if funds are not made available for the continuation of such

16 contract in any fiscal year covered by the contract.

17 Amounts available for paying termination costs shall re18 main available for such purpose until the costs associated

19 with termination of the contract are paid.

20 ‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sec21 tion is intended to modify or affect any other provision of

22 law that authorizes multiyear contracts.’’.

23 (b) CLERICAL AMENDMENT.—The table of contents in

24 the first section of such Act, as amended by section 1067,
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1 is further amended by inserting after the item relating to

2 section 303I the following new item:

‘‘Sec. 303J. Multiyear contracts.’’.

3 SEC. 1073. SEVERABLE SERVICES CONTRACTS CROSSING

4 FISCAL YEARS.

5 (a) AUTHORITY.—Title III of the Federal Property

6 and Administrative Services Act of 1949 (41 U.S.C. 251

7 et seq.), as amended by section 1072, is further amended

8 by inserting after section 303J the following new section:

9 ‘‘SEVERABLE SERVICES CONTRACTS FOR PERIODS

10 CROSSING FISCAL YEARS

11 ‘‘SEC. 303K. (a) AUTHORITY.—The head of an execu12 tive agency may enter into a severable contract for procure13 ment of services for a period that begins in one fiscal year

14 and ends in the next fiscal year if (without regard to any

15 option to extend the period of the contract) the contract pe16 riod does not exceed one year.

17 ‘‘(b) AVAILABILITY OF FUNDS.—To the extent provided

18 in appropriations Acts, funds obligated for a contract en19 tered into under the authority of subsection (a) shall remain

20 available until no longer needed to pay for such contract.

21 ‘‘(c) SEVERABLE CONTRACT DEFINED.—In this sec22 tion, the term ‘severable contract’ means a contract that

23 contains a clause that makes the effectiveness of the contract

24 for periods after the end of the fiscal year in which the per-
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1 formance of the contract begins subject to the availability

2 of appropriations.’’.

3 (b) CLERICAL AMENDMENT.—The table of contents in

4 the first section of such Act, as amended by section 1072,

5 is further amended by inserting after the item relating to

6 section 303J the following new item:

‘‘Sec. 303K. Severable services contracts for periods crossing fiscal years.’’.

7 SEC. 1074. ECONOMY ACT PURCHASES.

8 (a) REGULATIONS REQUIRED.—Not later than six

9 months after the date of the enactment of this Act, the Fed10 eral Acquisition Regulation shall be revised to include regu11 lations governing the exercise of the authority under section

12 1535 of title 31, United States Code, for Federal agencies

13 to purchase goods and services under contracts entered into

14 or administered by other agencies.

15 (b) CONTENT OF REGULATIONS.—The regulations pre16 scribed pursuant to subsection (a) shall—

17 (1) require that each purchase described in sub18 section (a) be approved in advance by a contracting

19 officer of the ordering agency with authority to con20 tract for the goods or services to be purchased or by

21 another official in a position specifically designated

22 by regulation to approve such purchase;

23 (2) provide that such a purchase of goods or

24 services may be made only if—
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1 (A) the purchase is appropriately made

2 under a contract that the agency filling the pur3 chase order entered into, before the purchase

4 order, in order to meet the requirements of such

5 agency for the same or similar goods or services;

6 (B) the agency filling the purchase order is

7 better qualified to enter into or administer the

8 contract for such goods or services by reason of

9 capabilities or expertise that is not available

10 within the ordering agency; or

11 (C) the agency or unit filling the order is

12 specifically authorized by law or regulations to

13 purchase such goods or services on behalf of other

14 agencies;

15 (3) prohibit any such purchase under a contract

16 or other agreement entered into or administered by an

17 agency not covered by the provisions of chapter 137

18 of title 10, United States Code, or title III of the Fed19 eral Property and Administrative Services Act of

20 1949 (41 U.S.C. 251 et seq.) and not covered by the

21 Federal Acquisition Regulation unless the purchase is

22 approved in advance by the senior procurement offi23 cial responsible for purchasing by the ordering agen24 cy; and
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1 (4) prohibit any payment to the agency filling a

2 purchase order of any fee that exceeds the actual cost

3 or, if the actual cost is not known, the estimated cost

4 of entering into and administering the contract or

5 other agreement under which the order is filled.

6 (c) MONITORING SYSTEM REQUIRED.—The Adminis7 trator for Federal Procurement Policy shall ensure that, not

8 later than one year after the date of the enactment of this

9 Act, systems for collecting and evaluating procurement data

10 are capable of collecting and evaluating appropriate data

11 on procurements conducted under the regulations prescribed

12 pursuant to subsection (a).

13 (d) TERMINATION.—This section shall cease to be effec14 tive one year after the date on which final regulations pre15 scribed pursuant to subsection (a) take effect.

16 PART III—ACQUISITIONS GENERALLY

17 SEC. 1091. POLICY REGARDING CONSIDERATION OF CON18 TRACTOR PAST PERFORMANCE.

19 (a) POLICY.—Section 2 of the Office of Federal Pro20 curement Policy Act (41 U.S.C. 401) is amended—

21 (1) by striking out ‘‘and’’ at the end of para22 graph (12);

23 (2) by striking out the period at the end of para24 graph (13) and inserting in lieu thereof ‘‘; and’’; and
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1 (3) by adding at the end the following new para2 graph:

3 ‘‘(14) establishing policies and procedures that

4 encourage the consideration of contractors’ past per5 formance in the selection of contractors.’’.

6 (b) GUIDANCE REQUIRED.—Section 6 of the Office of

7 Federal Procurement Policy Act (41 U.S.C. 405) is amend8 ed by adding at the end the following:

9 ‘‘(j)(1) Congress makes the following findings:

10 ‘‘(A) Past contract performance of an offeror is

11 one of the relevant factors that contracting officials of

12 executive agencies should consider in entering into

13 contracts.

14 ‘‘(B) It is appropriate for a contracting official

15 to consider past contract performance of an offeror as

16 an indicator of the likelihood that the offeror will suc17 cessfully perform a contract to be entered into by that

18 official.

19 ‘‘(2) The Administrator shall prescribe for executive

20 agencies guidance regarding consideration of the past con21 tract performance of offerors in awarding contracts. The

22 guidance shall include—

23 ‘‘(A) standards for evaluating past performance

24 with respect to cost (when appropriate), schedule,

25 compliance with technical or functional specifica-
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1 tions, and other relevant performance factors that fa2 cilitate consistent and fair evaluation by all executive

3 agencies;

4 ‘‘(B) policies for the collection and maintenance

5 of information on past contract performance that, to

6 the maximum extent practicable, facilitate automated

7 collection, maintenance, and dissemination of infor8 mation and provide for ease of collection, mainte9 nance, and dissemination of information by other

10 methods, as necessary; and

11 ‘‘(C) policies for ensuring that offerors are af12 forded an opportunity to submit information on past

13 contract performance and that information submitted

14 by offerors is considered.

15 ‘‘(3) The Administrator shall prescribe for all executive

16 agencies the policy regarding the period for which informa17 tion on past performance of offerors may be maintained

18 and considered.

19 ‘‘(4) In the case of an offeror regarding whom there

20 is no information on past contract performance or regard21 ing whom information on past contract performance is not

22 available, the offeror may not be evaluated favorably or un23 favorably on the factor of past contract performance.’’.
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1 SEC. 1092. REPEAL OF REQUIREMENT FOR ANNUAL REPORT

2 ON COMPETITION.

3 Section 23 of the Office of Federal Procurement Policy

4 Act (41 U.S.C. 419) is repealed.

5 Subtitle B—Truth in Negotiations

6 PART I—ARMED SERVICES ACQUISITIONS

7 SEC. 1201. STABILIZATION OF DOLLAR THRESHOLD OF AP8 PLICABILITY.

9 (a) REPEAL OF REVERSION TO LOWER THRESH10 OLD.—Paragraph (1)(A) of section 2306a(a) of title 10,

11 United States Code, is amended—

12 (1) in clause (i), by striking out ‘‘and before

13 January 1, 1996,’’; and

14 (2) in clause (ii), by striking out ‘‘or after De15 cember 31, 1995,’’.

16 (b) ADJUSTMENTS FOR CHANGES IN DOLLAR VAL17 UES.—Section 2306a(a) of such title is amended by adding

18 at the end the following new subparagraph:

19 ‘‘(7) Effective on October 1 of each year that is divis20 ible by 5, each amount set forth in paragraph (1) shall be

21 adjusted to the amount that is equal to the fiscal year 1994

22 constant dollar value of the amount set forth. Any amount,

23 as so adjusted, that is not evenly divisible by $50,000 shall

24 be rounded to the nearest multiple of $50,000. In the case

25 of an amount that is evenly divisible by $25,000 but not
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1 evenly divisible by $50,000, the amount shall be rounded

2 to the next higher multiple of $50,000.’’.

3 SEC. 1202. EXCEPTIONS TO COST OR PRICING DATA RE4 QUIREMENTS.

5 (a) EXCEPTIONS STATED.—Subsection (b) of section

6 2306a of title 10, United States Code, is amended to read

7 as follows:

8 ‘‘(b) EXCEPTIONS.—(1) Submission of cost and pric9 ing data shall not be required under subsection (a)—

10 ‘‘(A) in the case of a contract, a subcontract, or

11 a contract or subcontract modification, for which the

12 price agreed upon is based on—

13 ‘‘(i) adequate price competition;

14 ‘‘(ii) established catalog or market prices of

15 commercial items or of services customarily used

16 for other than Government purposes, as the case

17 may be, that are sold in substantial quantities to

18 the general public; or

19 ‘‘(iii) prices set by law or regulation; or

20 ‘‘(B) in an exceptional case when the head of the

21 agency concerned determines that the requirements of

22 this section may be waived and states in writing the

23 reasons for such determination.
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1 ‘‘(2) Submission of cost and pricing data shall not be

2 required under subsection (a) in the case of a modification

3 of a contract or subcontract for a commercial item if—

4 ‘‘(A) the contract or subcontract being modified

5 is a contract or subcontract for which submission of

6 cost and pricing data may not be required by reason

7 of paragraph (1)(A);

8 ‘‘(B) the modification is not a case in which

9 paragraph (1)(A) prohibits the head of an agency

10 from requiring submission of cost and pricing data;

11 and

12 ‘‘(C) the modification would not change the con13 tract or subcontract, as the case may be, from a con14 tract or subcontract for the acquisition of a commer15 cial item to a contract or subcontract for the acquisi16 tion of a noncommercial item.’’.

17 (b) CONFORMING AMENDMENT TO REFERENCE.—Sub18 section (a)(5) of such section is amended by striking out

19 ‘‘subsection (b)(2)’’ and inserting in lieu thereof ‘‘subsection

20 (b)(1)(B)’’.

21 SEC. 1203. LIMITATION ON AUTHORITY TO REQUIRE A SUB22 MISSION NOT OTHERWISE REQUIRED.

23 Subsection (c) of section 2306a of title 10, United

24 States Code, is amended to read as follows:
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1 ‘‘(c) LIMITATION ON AUTHORITY TO REQUIRE COST

2 OR PRICING DATA.—When cost or pricing data are not re3 quired to be submitted under this section by reason of a

4 $500,000 threshold set forth in subsection (a) (as adjusted

5 pursuant to paragraph (7) of such subsection) or by reason

6 of an exception set forth in paragraph (1)(A) or (2) of sub7 section (b), submission of such data may not be required

8 unless the head of an agency concerned determines that such

9 data are necessary for the evaluation by the agency of the

10 reasonableness of the price of the contract or subcontract

11 to which the data relate. In any case in which the head

12 of an agency requires such data to be submitted in accord13 ance with the preceding sentence, the agency head shall doc14 ument in writing the reasons for such requirement.’’.

15 SEC. 1204. ADDITIONAL SPECIAL RULES FOR COMMERCIAL

16 ITEMS.

17 Section 2306a of title 10, United States Code, is

18 amended—

19 (1) by redesignating subsections (d), (e), (f), and

20 (g) as subsections (e), (f), (g), and (i), respectively;

21 and

22 (2) by inserting after subsection (c) the following

23 new subsection (d):

24 ‘‘(d) ADDITIONAL EXCEPTION PROVISIONS REGARDING

25 COMMERCIAL ITEMS.—(1) To the maximum extent prac-
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1 ticable, the head of an agency shall conduct procurements

2 of commercial items on a competitive basis.

3 ‘‘(2) In any case in which it is not practicable to con4 duct a procurement of a commercial item on a competitive

5 basis and the procurement is not covered by an exception

6 in subsection (b), the contracting officer shall nonetheless

7 exempt a contract, subcontract, or modification of a con8 tract or subcontract under the procurement from the re9 quirements of subsection (a) if the contracting officer devel10 ops or obtains from the offeror or contractor, or from an11 other source or sources, in accordance with standards and

12 procedures set forth in the Federal Acquisition Regulation,

13 information on prices at which the same or similar items

14 have been sold in the commercial market that is adequate

15 for evaluating the reasonableness of the price of the contract

16 or subcontract for a commercial item, or the contract or

17 subcontract modification, as the case may be.

18 ‘‘(3)(A) In accordance with procedures prescribed in

19 the Federal Acquisition Regulation, the head of an agency

20 shall have the right to examine all information provided

21 by an offeror, contractor, or subcontractor pursuant to

22 paragraph (2) and all books and records of such offeror,

23 contractor, or subcontractor that directly relate to such in24 formation in order to determine whether the agency is re25 ceiving accurate information required under this section.
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1 ‘‘(B) The right under subparagraph (A) shall expire

2 3 years after the date of award of the contract, or 3 years

3 after the date of the modification of the contract, with re4 spect to which the information was provided.’’.

5 SEC. 1205. RIGHT OF UNITED STATES TO EXAMINE CON6 TRACTOR RECORDS.

7 Section 2306a of title 10, United States Code, is

8 amended by striking out subsection (g), as redesignated by

9 section 1204(1), and inserting in lieu thereof the following:

10 ‘‘(g) RIGHT OF UNITED STATES TO EXAMINE CON11 TRACTOR RECORDS.—For the purpose of evaluating the ac12 curacy, completeness, and currency of cost or pricing data

13 required to be submitted by this section, the head of an

14 agency shall have the rights provided by section 2313 of

15 this title.’’.

16 SEC. 1206. REQUIRED REGULATIONS.

17 Section 2306a of title 10, United States Code, as

18 amended by sections 1204 and 1205, is further amended

19 by inserting after subsection (g) the following new sub20 section:

21 ‘‘(h) REQUIRED REGULATIONS.—The Secretary shall

22 prescribe regulations concerning the types of information

23 that offerors must submit for a contracting officer to con24 sider in determining whether the price of a procurement

25 to the Government is fair and reasonable when certified cost
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1 or pricing data are not required to be submitted under this

2 section because the price of the procurement to the United

3 States is not expected to exceed an applicable $500,000

4 threshold set forth in subsection (a) (as adjusted pursuant

5 to paragraph (7) of such subsection). Such information, at

6 a minimum, shall include appropriate information on the

7 prices at which such offeror has previously sold the same

8 or similar products.’’.

9 SEC. 1207. CONSISTENCY OF TIME REFERENCES.

10 Section 2306a of title 10, United States Code, as

11 amended by section 1204(1), is further amended—

12 (1) in subparagraphs (A)(ii) and (B)(ii) of sub13 section (e)(4), by inserting ‘‘or, if applicable consist14 ent with paragraph (1)(B), another date agreed upon

15 between the parties,’’ after ‘‘(or price of the modifica16 tion)’’; and

17 (2) in subsection (i), by inserting ‘‘or, if applica18 ble consistent with subsection (d)(1)(B), another date

19 agreed upon between the parties’’ after ‘‘(or the price

20 of a contract modification)’’.

21 SEC. 1208. EXCEPTION FOR TRANSFERS BETWEEN DIVI22 SIONS, SUBSIDIARIES, AND AFFILIATES.

23 Subsection (i) of section 2306a of title 10, United

24 States Code, as redesignated by section 1204(1), is amended

25 to read as follows:
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1 ‘‘(i) DEFINITIONS.—In this section:

2 ‘‘(1) The term ‘cost or pricing data’ means all

3 facts that, as of the date of agreement on the price of

4 a contract (or the price of a contract modification),

5 a prudent buyer or seller would reasonably expect to

6 affect price negotiations significantly. Such term does

7 not include information that is judgmental, but does

8 include the factual information from which a judg9 ment was derived.

10 ‘‘(2) The term ‘subcontract’ includes a transfer of

11 commercial items between divisions, subsidiaries, or

12 affiliates of a contractor.’’.

13 SEC. 1209. REPEAL OF SUPERSEDED PROVISION.

14 Subsections (b) and (c) of section 803 of Public Law

15 101–510 (10 U.S.C. 2306a note) are repealed.

16 PART II—CIVILIAN AGENCY ACQUISITIONS

17 SEC. 1251. REVISION OF CIVILIAN AGENCY PROVISIONS TO

18 ENSURE UNIFORM TREATMENT OF COST OR

19 PRICING DATA.

20 (a) IN GENERAL.—Title III of the Federal Property

21 and Administrative Services Act of 1949 (41 U.S.C. 251

22 et seq.) is amended—

23 (1) in section 304, by striking out subsection (d);

24 and
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1 (2) by inserting after section 304 the following

2 new section:

3 ‘‘COST OR PRICING DATA: TRUTH IN NEGOTIATIONS

4 ‘‘SEC. 304A. (a) REQUIRED COST OR PRICING DATA

5 AND CERTIFICATION.—(1) An agency head shall require

6 offerors, contractors, and subcontractors to make cost or

7 pricing data available as follows:

8 ‘‘(A) An offeror for a prime contract under this

9 title to be entered into using procedures other than

10 sealed-bid procedures shall be required to submit cost

11 or pricing data before the award of a contract if—

12 ‘‘(i) in the case of a prime contract entered

13 into after the date of the enactment of the Fed14 eral Acquisition Streamlining Act of 1994, the

15 price of the contract to the United States is ex16 pected to exceed $500,000; and

17 ‘‘(ii) in the case of a prime contract entered

18 into on or before the date of the enactment of the

19 Federal Acquisition Streamlining Act of 1994,

20 the price of the contract to the United States is

21 expected to exceed $100,000.

22 ‘‘(B) The contractor for a prime contract under

23 this chapter shall be required to submit cost or pric24 ing data before the pricing of a change or modifica25 tion to the contract if—
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1 ‘‘(i) in the case of a change or modification

2 made to a prime contract referred to in subpara3 graph (A)(i), the price adjustment is expected to

4 exceed $500,000;

5 ‘‘(ii) in the case of a change or modification

6 made to a prime contract that was entered into

7 on or before the date of the enactment of the Fed8 eral Acquisition Streamlining Act of 1994, and

9 that has been modified pursuant to paragraph

10 (6), the price adjustment is expected to exceed

11 $500,000; and

12 ‘‘(iii) in the case of a change or modifica13 tion not covered by clause (i) or (ii), the price

14 adjustment is expected to exceed $100,000.

15 ‘‘(C) An offeror for a subcontract (at any tier)

16 of a contract under this title shall be required to sub17 mit cost or pricing data before the award of the sub18 contract if the prime contractor and each higher-tier

19 subcontractor have been required to make available

20 cost or pricing data under this section and—

21 ‘‘(i) in the case of a subcontract under a

22 prime contract referred to in subparagraph

23 (A)(i), the price of the subcontract is expected to

24 exceed $500,000;
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1 ‘‘(ii) in the case of a subcontract entered

2 into under a prime contract that was entered

3 into on or before the date of the enactment of the

4 Federal Acquisition Streamlining Act of 1994,

5 and that has been modified pursuant to para6 graph (6), the price of the subcontract is expected

7 to exceed $500,000; and

8 ‘‘(iii) in the case of a subcontract not cov9 ered by clause (i) or (ii), the price of the sub10 contract is expected to exceed $100,000.

11 ‘‘(D) The subcontractor for a subcontract covered

12 by subparagraph (C) shall be required to submit cost

13 or pricing data before the pricing of a change or

14 modification to the subcontract if—

15 ‘‘(i) in the case of a change or modification

16 to a subcontract referred to in subparagraph

17 (C)(i) or (C)(ii), the price adjustment is expected

18 to exceed $500,000; and

19 ‘‘(ii) in the case of a change or modification

20 to a subcontract referred to in subparagraph

21 (C)(iii), the price adjustment is expected to ex22 ceed $100,000.

23 ‘‘(2) A person required, as an offeror, contractor, or

24 subcontractor, to submit cost or pricing data under para25 graph (1) (or required by the agency head concerned to sub-
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1 mit such data in accordance with subsection (c)) shall be

2 required to certify that, to the best of the person’s knowledge

3 and belief, the cost or pricing data submitted are accurate,

4 complete, and current.

5 ‘‘(3) Cost or pricing data required to be submitted

6 under paragraph (1) (or in accordance with subsection (c)),

7 and a certification required to be submitted under para8 graph (2), shall be submitted—

9 ‘‘(A) in the case of a submission by a prime con10 tractor (or an offeror for a prime contract), to the

11 contracting officer for the contract (or to a designated

12 representative of the contracting officer); or

13 ‘‘(B) in the case of a submission by a sub14 contractor (or an offeror for a subcontract), to the

15 prime contractor.

16 ‘‘(4) Except as provided under subsection (b), this sec17 tion applies to contracts entered into by an agency head

18 on behalf of a foreign government.

19 ‘‘(5) For purposes of paragraph (1)(C), a contractor

20 or subcontractor granted a waiver under subsection

21 (b)(1)(B) shall be considered as having been required to

22 make available cost or pricing data under this section.

23 ‘‘(6)(A) Upon the request of a contractor that was re24 quired to submit cost or pricing data under paragraph (1)

25 in connection with a prime contract entered into on or be-
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1 fore the date of the enactment of the Federal Acquisition

2 Streamlining Act of 1994, the agency head that entered into

3 such contract shall modify the contract to reflect subpara4 graphs (B)(ii) and (C)(ii) of paragraph (1). All such modi5 fications shall be made without requiring consideration.

6 ‘‘(B) An agency head is not required to modify a con7 tract under subparagraph (A) if that agency head deter8 mines that the submission of cost or pricing data with re9 spect to that contract should be required in accordance with

10 subsection (c).

11 ‘‘(7) Effective on October 1 of each year that is divis12 ible by 5, each amount set forth in paragraph (1) shall be

13 adjusted to the amount that is equal to the fiscal year 1994

14 constant dollar value of the amount set forth. Any amount,

15 as so adjusted, that is not evenly divisible by $50,000 shall

16 be rounded to the nearest multiple of $50,000. In the case

17 of an amount that is evenly divisible by $25,000 but not

18 evenly divisible by $50,000, the amount shall be rounded

19 to the next higher multiple of $50,000.

20 ‘‘(b) EXCEPTIONS.—(1) Submission of cost and pric21 ing data shall not be required under subsection (a)—

22 ‘‘(A) in the case of a contract, a subcontract, or

23 a contract or subcontract modification, for which the

24 price agreed upon is based on—

25 ‘‘(i) adequate price competition;
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1 ‘‘(ii) established catalog or market prices of

2 commercial items or of services customarily used

3 for other than Government purposes, as the case

4 may be, that are sold in substantial quantities to

5 the general public; or

6 ‘‘(iii) prices set by law or regulation; or

7 ‘‘(B) in an exceptional case when the agency

8 head concerned determines that the requirements of

9 this section may be waived and states in writing the

10 reasons for such determination.

11 ‘‘(2) Submission of cost and pricing data shall not be

12 required under subsection (a) in the case of a modification

13 of a contract or subcontract for a commercial item if—

14 ‘‘(A) the contract or subcontract being modified

15 is a contract or subcontract for which submission of

16 cost and pricing data may not be required by reason

17 of paragraph (1)(A);

18 ‘‘(B) the modification is not a case in which

19 paragraph (1)(A) prohibits the agency head from re20 quiring submission of cost and pricing data; and

21 ‘‘(C) the modification would not change the con22 tract or subcontract, as the case may be, from a con23 tract or subcontract for the acquisition of a commer24 cial item to a contract or subcontract for the acquisi25 tion of a noncommercial item.
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1 ‘‘(c) LIMITATION ON AUTHORITY TO REQUIRE COST

2 OR PRICING DATA.—When cost or pricing data are not re3 quired to be submitted under this section by reason of a

4 $500,000 threshold set forth in subsection (a) (as adjusted

5 pursuant to paragraph (7) of such subsection) or by reason

6 of an exception in paragraph (1)(A) or (2) of subsection

7 (b), submission of such data may not be required unless

8 the agency head concerned determines that such data are

9 necessary for the evaluation by the agency of the reasonable10 ness of the price of the contract or subcontract to which the

11 data relate. In any case in which the agency head requires

12 such data to be submitted in accordance with the preceding

13 sentence, the agency head shall document in writing the rea14 sons for such requirement.

15 ‘‘(d) ADDITIONAL EXCEPTION PROVISIONS REGARDING

16 COMMERCIAL ITEMS.—(1) To the maximum extent prac17 ticable, an agency head shall conduct procurements of com18 mercial items on a competitive basis.

19 ‘‘(2) In any case in which it is not practicable to con20 duct a procurement of a commercial item on a competitive

21 basis and the procurement is not covered by an exception

22 in subsection (b), the contracting officer shall nonetheless

23 exempt a contract, subcontract, or modification of a con24 tract or subcontract under the procurement from the re25 quirements of subsection (a) if the contracting officer devel-
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1 ops or obtains from the offeror or contractor, or from an2 other source or sources, in accordance with standards and

3 procedures set forth in the Federal Acquisition Regulation,

4 information on prices at which the same or similar items

5 have been sold in the commercial market that is adequate

6 for evaluating the reasonableness of the price of the contract

7 or subcontract for a commercial item, or the contract or

8 subcontract modification, as the case may be.

9 ‘‘(3)(A) In accordance with procedures prescribed in

10 the Federal Acquisition Regulation, an agency head shall

11 have the right to examine all information provided by an

12 offeror, contractor, or subcontractor pursuant to paragraph

13 (2) and all books and records of such offeror, contractor,

14 or subcontractor that directly relate to such information in

15 order to determine whether the agency is receiving accurate

16 information required under this section.

17 ‘‘(B) The right under subparagraph (A) shall expire

18 3 years after the date of award of the contract, or 3 years

19 after the date of the modification of the contract, with re20 spect to which the information was provided.

21 ‘‘(e) PRICE REDUCTIONS FOR DEFECTIVE COST OR

22 PRICING DATA.—(1)(A) A prime contract (or change or

23 modification to a prime contract) under which a certificate

24 under subsection (a)(2) is required shall contain a provi25 sion that the price of the contract to the United States, in-
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1 cluding profit or fee, shall be adjusted to exclude any sig2 nificant amount by which it may be determined by the

3 agency head that such price was increased because the con4 tractor (or any subcontractor required to make available

5 such a certificate) submitted defective cost or pricing data.

6 ‘‘(B) For the purposes of this section, defective cost or

7 pricing data are cost or pricing data which, as of the date

8 of agreement on the price of the contract (or another date

9 agreed upon between the parties), were inaccurate, incom10 plete, or noncurrent. If for purposes of the preceding sen11 tence the parties agree upon a date other than the date of

12 agreement on the price of the contract, the date agreed upon

13 by the parties shall be as close to the date of agreement on

14 the price of the contract as is practicable.

15 ‘‘(2) In determining for purposes of a contract price

16 adjustment under a contract provision required by para17 graph (1) whether, and to what extent, a contract price was

18 increased because the contractor (or a subcontractor) sub19 mitted defective cost or pricing data, it shall be a defense

20 that the United States did not rely on the defective data

21 submitted by the contractor or subcontractor.

22 ‘‘(3) It is not a defense to an adjustment of the price

23 of a contract under a contract provision required by para24 graph (1) that—
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1 ‘‘(A) the price of the contract would not have

2 been modified even if accurate, complete, and current

3 cost or pricing data had been submitted by the con4 tractor or subcontractor because the contractor or sub5 contractor—

6 ‘‘(i) was the sole source of the property or

7 services procured; or

8 ‘‘(ii) otherwise was in a superior bargain9 ing position with respect to the property or serv10 ices procured;

11 ‘‘(B) the contracting officer should have known

12 that the cost and pricing data in issue were defective

13 even though the contractor or subcontractor took no

14 affirmative action to bring the character of the data

15 to the attention of the contracting officer;

16 ‘‘(C) the contract was based on an agreement be17 tween the contractor and the United States about the

18 total cost of the contract and there was no agreement

19 about the cost of each item procured under such con20 tract; or

21 ‘‘(D) the prime contractor or subcontractor did

22 not submit a certification of cost and pricing data re23 lating to the contract as required under subsection

24 (a)(2).
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1 ‘‘(4)(A) A contractor shall be allowed to offset an

2 amount against the amount of a contract price adjustment

3 under a contract provision required by paragraph (1) if—

4 ‘‘(i) the contractor certifies to the contracting of5 ficer (or to a designated representative of the contract6 ing officer) that, to the best of the contractor’s knowl7 edge and belief, the contractor is entitled to the offset;

8 and

9 ‘‘(ii) the contractor proves that the cost or pric10 ing data were available before the date of agreement

11 on the price of the contract (or price of the modifica12 tion), or, if applicable consistent with paragraph

13 (1)(B), another date agreed upon between the parties,

14 and that the data were not submitted as specified in

15 subsection (a)(3) before such date.

16 ‘‘(B) A contractor shall not be allowed to offset an

17 amount otherwise authorized to be offset under subpara18 graph (A) if—

19 ‘‘(i) the certification under subsection (a)(2)

20 with respect to the cost or pricing data involved was

21 known to be false when signed; or

22 ‘‘(ii) the United States proves that, had the cost

23 or pricing data referred to in subparagraph (A)(ii)

24 been submitted to the United States before the date of

25 agreement on the price of the contract (or price of the
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1 modification) or, if applicable under paragraph

2 (1)(B), another date agreed upon between the parties,

3 the submission of such cost or pricing data would not

4 have resulted in an increase in that price in the

5 amount to be offset.

6 ‘‘(f) INTEREST AND PENALTIES FOR CERTAIN OVER7 PAYMENTS.—(1) If the United States makes an overpay8 ment to a contractor under a contract with an executive

9 agency subject to this section and the overpayment was due

10 to the submission by the contractor of defective cost or pric11 ing data, the contractor shall be liable to the United

12 States—

13 ‘‘(A) for interest on the amount of such overpay14 ment, to be computed—

15 ‘‘(i) for the period beginning on the date the

16 overpayment was made to the contractor and

17 ending on the date the contractor repays the

18 amount of such overpayment to the United

19 States; and

20 ‘‘(ii) at the current rate prescribed by the

21 Secretary of the Treasury under section 6621 of

22 the Internal Revenue Code of 1986; and

23 ‘‘(B) if the submission of such defective data was

24 a knowing submission, for an additional amount

25 equal to the amount of the overpayment.
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1 ‘‘(2) Any liability under this subsection of a contractor

2 that submits cost or pricing data but refuses to submit the

3 certification required by subsection (a)(2) with respect to

4 the cost or pricing data shall not be affected by the refusal

5 to submit such certification.

6 ‘‘(g) RIGHT OF UNITED STATES TO EXAMINE CON7 TRACTOR RECORDS.—For the purpose of evaluating the ac8 curacy, completeness, and currency of cost or pricing data

9 required to be submitted by this section, the head of an

10 agency shall have the rights provided by section 304B(a)(2).

11 ‘‘(h) REQUIRED REGULATIONS.—The Federal Acquisi12 tion Regulation shall include regulations concerning the

13 types of information that offerors must submit for a con14 tracting officer to consider in determining whether the price

15 of a procurement to the Government is fair and reasonable

16 when certified cost or pricing data are not required to be

17 submitted under this section because the price of the pro18 curement to the United States is not expected to exceed an

19 applicable $500,000 threshold set forth in subsection (a) (as

20 adjusted pursuant to paragraph (7) of such subsection).

21 Such information, at a minimum, shall include appro22 priate information on the prices at which such offeror has

23 previously sold the same or similar products.

24 ‘‘(i) DEFINITIONS.—In this section:
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1 ‘‘(1) The term ‘cost or pricing data’ means all

2 facts that, as of the date of agreement on the price of

3 a contract (or the price of a contract modification) or,

4 if applicable consistent with subsection (e)(1)(B), an5 other date agreed upon between the parties, a prudent

6 buyer or seller would reasonably expect to affect price

7 negotiations significantly. Such term does not include

8 information that is judgmental, but does include the

9 factual information from which a judgment was de10 rived.

11 ‘‘(2) The term ‘subcontract’ includes a transfer of

12 commercial items between divisions, subsidiaries, or

13 affiliates of a contractor.’’.

14 (b) TABLE OF CONTENTS.—The table of contents in the

15 first section of such Act is amended by inserting after the

16 item relating to section 304 the following:

‘‘Sec. 304A. Cost or pricing data: truth in negotiations.’’.

17 SEC. 1252. REPEAL OF OBSOLETE PROVISION.

18 (a) REPEAL.—Section 303E of the Federal Property

19 and Administrative Services Act of 1949 (41 U.S.C. 253e)

20 is repealed.

21 (b) CLERICAL AMENDMENT.—The table of contents in

22 the first section of such Act is amended by striking out the

23 item relating to section 303E.
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1 Subtitle C—Research and

2 Development

3 SEC. 1301. RESEARCH PROJECTS.

4 (a) AUTHORIZED MEANS.—Subsection (b) of section

5 2358 of title 10, United States Code, is amended to read

6 as follows:

7 ‘‘(b) AUTHORIZED MEANS.—The Secretary of Defense

8 or the Secretary of a military department may perform re9 search and development projects—

10 ‘‘(1) by contract entered into with, grant made

11 to, or cooperative agreement entered into with edu12 cational or research institutions, private businesses,

13 or other persons in accordance with the provisions of

14 chapter 63 of title 31;

15 ‘‘(2) through one or more military departments;

16 ‘‘(3) by using employees and consultants of the

17 Department of Defense; or

18 ‘‘(4) by mutual agreement with the head of any

19 other department or agency of the Federal Govern20 ment.’’.

21 (b) CAPTION AMENDMENT.—The caption of subsection

22 (c) of such section is amended by striking out ‘‘MILITARY’’

23 and inserting in lieu thereof ‘‘DEPARTMENT OF DEFENSE’’.

24 (c) ADVANCED RESEARCH PROJECTS.—
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1 (1) RESTORATION AND REVISION OF FORMER

2 STATEMENT OF AUTHORITY.—Section 2371 of title 10,

3 United States Code, is amended—

4 (A) by redesignating subsections (a), (b),

5 (c), (d), (e), and (f) as subsections (b), (c), (d),

6 (e), (f), and (g), respectively; and

7 (B) by inserting before subsection (b), as so

8 redesignated, the following new subsection (a):

9 ‘‘(a) The Secretary of Defense, acting through the Ad10 vanced Research Projects Agency and such other elements

11 of the Department of Defense as the Secretary may des12 ignate, and the Secretary of each military department, in

13 carrying out basic, applied, and advanced research projects,

14 may enter into other transactions, in addition to contracts,

15 grants, and cooperative agreements authorized by section

16 2358 of this title.’’.

17 (2) CONFORMING AMENDMENTS.—Such section,

18 as amended by paragraph (1), is further amended—

19 (A) in subsection (b)—

20 (i) in paragraph (1), by inserting ‘‘or

21 subsection (a)’’ after ‘‘section 2358 of this

22 title’’; and

23 (ii) in paragraph (2), by striking out

24 ‘‘subsection (d)’’ and inserting in lieu there25 of ‘‘subsection (e)’’;
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1 (B) in subsection (c), by inserting ‘‘section

2 2358 of this title or’’ after ‘‘under’’;

3 (C) in subsection (d)—

4 (i) in paragraph (1), by striking out

5 ‘‘this section’’ and inserting in lieu thereof

6 ‘‘section 2358 of this title or subsection (a)’’;

7 and

8 (ii) in paragraph (3), by striking out

9 ‘‘this section’’ and inserting in lieu thereof

10 ‘‘section 2358 of this title or subsection (a)’’;

11 (D) in subsection (e), by inserting ‘‘or sub12 section (a)’’ in the first sentence after ‘‘section

13 2358 of this title’’; and

14 (E) in subsection (f)—

15 (i) in the first sentence, by striking out

16 ‘‘under this section’’ and inserting in lieu

17 thereof ‘‘under section 2358 of this title or

18 subsection (a)’’;

19 (ii) in paragraph (4), by striking out

20 ‘‘subsection (a)’’ and inserting in lieu there21 of ‘‘subsection (b)’’; and

22 (iii) in paragraph (5), by striking out

23 ‘‘subsection (d)’’ and inserting in lieu there24 of ‘‘subsection (e)’’.
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1 SEC. 1302. ELIMINATION OF INFLEXIBLE TERMINOLOGY RE2 GARDING COORDINATION AND COMMUNICA3 TION OF DEFENSE RESEARCH ACTIVITIES.

4 Section 2364 of title 10, United States Code, is amend5 ed—

6 (1) in subsection (b)(5), by striking out ‘‘mile7 stone 0, milestone I, and milestone II decisions’’ and

8 inserting in lieu thereof ‘‘acquisition program deci9 sions’’; and

10 (2) in subsection (c), by striking out paragraphs

11 (2), (3), and (4) and inserting in lieu thereof the fol12 lowing:

13 ‘‘(2) The term ‘acquisition program decisions’

14 has the meaning given such term in regulations pre15 scribed by the Secretary of Defense for the purposes

16 of this section.’’.

17 Subtitle D—Procurement Protests

18 PART I—PROTESTS TO THE COMPTROLLER

19 GENERAL

20 SEC. 1401. PROTEST DEFINED.

21 Paragraph (1) of section 3551 of title 31, United

22 States Code, is amended to read as follows:

23 ‘‘(1) ‘protest’ means a written objection by an

24 interested party—
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1 ‘‘(i) to a solicitation or other request by a

2 Federal agency for offers for a contract for the

3 procurement of property or services;

4 ‘‘(ii) to the cancellation of such a solicita5 tion or other request;

6 ‘‘(iii) to an award or proposed award of

7 such a contract; or

8 ‘‘(iv) to a termination or cancellation of an

9 award of such a contract, if the written objection

10 contains an allegation that the termination or

11 cancellation is based in whole or in part on im12 proprieties concerning the award of the con13 tract;’’.

14 SEC. 1402. REVIEW OF PROTESTS AND EFFECT ON CON15 TRACTS PENDING DECISION.

16 (a) PERIODS FOR CERTAIN ACTIONS.—Section 3553 of

17 title 31, United States Code, is amended—

18 (1) in subsection (b)—

19 (A) in paragraph (1), by striking out ‘‘one

20 working day of’’ and inserting in lieu thereof

21 ‘‘one day after’’; and

22 (B) in paragraph (2)—

23 (i) in subparagraph (A), by striking

24 out ‘‘25 working days from’’ and inserting

25 in lieu thereof ‘‘35 days after’’; and
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1 (ii) in subparagraph (C), by striking

2 out ‘‘10 working days from’’ and inserting

3 in lieu thereof ‘‘25 days after’’; and

4 (2) in subsection (c)(3), by striking out ‘‘there5 after’’ and inserting in lieu thereof ‘‘after the making

6 of such finding’’.

7 (b) SUSPENSION OF PERFORMANCE.—Subsection (d) of

8 such section is amended to read as follows:

9 ‘‘(d)(1) A contractor awarded a Federal agency con10 tract may, during the period described in paragraph (4),

11 begin performance of the contract and engage in any related

12 activities that result in obligations being incurred by the

13 United States under the contract unless the contracting offi14 cer responsible for the award of the contract withholds au15 thorization to proceed with performance of the contract.

16 ‘‘(2) The contracting officer may withhold an author17 ization to proceed with performance of the contract during

18 the period described in paragraph (4) if the contracting of19 ficer determines in writing that—

20 ‘‘(A) a protest is likely to be filed; and

21 ‘‘(B) the immediate performance of the contract

22 is not in the best interests of the United States.

23 ‘‘(3)(A) If the Federal agency awarding the contract

24 receives notice of a protest in accordance with this section

25 during the period described in paragraph (4)—
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1 ‘‘(i) the contracting officer may not authorize

2 performance of the contract to begin while the protest

3 is pending; or

4 ‘‘(ii) if contract performance authorization to

5 proceed was not withheld in accordance with para6 graph (2) before receipt of the notice, the contracting

7 officer shall immediately direct the contractor to cease

8 performance under the contract and to suspend any

9 related activities that may result in additional obli10 gations being incurred by the United States under

11 that contract.

12 ‘‘(B) Performance and related activities suspended

13 pursuant to subparagraph (A)(ii) by reason of a protest

14 may not be resumed while the protest is pending.

15 ‘‘(C) The head of the procuring activity may authorize

16 the performance of the contract (notwithstanding a protest

17 of which the Federal agency has notice under this section)—

18 ‘‘(i) upon a written finding that—

19 ‘‘(I) performance of the contract is in the

20 best interests of the United States; or

21 ‘‘(II) urgent and compelling circumstances

22 that significantly affect interests of the United

23 States will not permit waiting for the decision of

24 the Comptroller General concerning the protest;

25 and
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1 ‘‘(ii) after the Comptroller General is notified of

2 that finding.

3 ‘‘(4) The period referred to in paragraphs (2) and

4 (3)(A), with respect to a contract, is the period beginning

5 on the date of the contract award and ending on the later

6 of—

7 ‘‘(A) the date that is 10 days after the date of

8 the contract award; or

9 ‘‘(B) the date that is 5 days after—

10 ‘‘(i) the debriefing date offered to an unsuc11 cessful offeror for any debriefing that is requested

12 and, when requested, is required; or

13 ‘‘(ii) in the case of a contract for which no

14 debriefing is required, the date on which the un15 successful offeror receives the notification of con16 tract award.’’.

17 SEC. 1403. DECISIONS ON PROTESTS.

18 (a) PERIODS FOR CERTAIN ACTIONS.—Section

19 3554(a) of title 31, United States Code, is amended—

20 (1) in paragraph (1), by striking out ‘‘90 work21 ing days from’’ and inserting in lieu thereof ‘‘125

22 days after’’;

23 (2) in paragraph (2), by striking out ‘‘45 cal24 endar days from’’ and inserting ‘‘65 days after’’;
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1 (3) by redesignating paragraph (3) as para2 graph (4); and

3 (4) by inserting after paragraph (2) the follow4 ing new paragraph (3):

5 ‘‘(3) An amendment to a protest that adds a new

6 ground of protest, if timely made, should be resolved, to the

7 maximum extent practicable, within the time limit estab8 lished under paragraph (1) of this subsection for final deci9 sion of the initial protest. If an amended protest cannot

10 be resolved within such time limit, the Comptroller General

11 may resolve the amended protest through the express option

12 under paragraph (2) of this subsection.’’.

13 (b) GAO RECOMMENDATIONS ON PROTESTS.—

14 (1) IMPLEMENTATION OF RECOMMENDATIONS.—

15 Section 3554 of title 31, United States Code, is

16 amended—

17 (A) in subsection (b), by adding at the end

18 the following new paragraph:

19 ‘‘(3) If the Federal agency fails to implement fully the

20 recommendations of the Comptroller General under this

21 subsection with respect to a solicitation for a contract or

22 an award or proposed award of a contract within 60 days

23 after receiving the recommendations, the head of the procur24 ing activity responsible for that contract shall report such
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1 failure to the Comptroller General not later than 5 working

2 days after the end of such 60-day period.’’;

3 (B) by striking out subsection (c) and in4 serting in lieu thereof the following:

5 ‘‘(c)(1) If the Comptroller General determines that a

6 solicitation for a contract or a proposed award or the award

7 of a contract does not comply with a statute or regulation,

8 the Comptroller General may recommend that the Federal

9 agency conducting the procurement pay to an appropriate

10 interested party the costs of—

11 ‘‘(A) filing and pursuing the protest, including

12 reasonable attorney’s fees and consultant and expert

13 witness fees; and

14 ‘‘(B) bid and proposal preparation.

15 ‘‘(2) No party may be paid, pursuant to a rec16 ommendation made under the authority of paragraph (1)—

17 ‘‘(A) costs for consultant and expert witness fees

18 that exceed the rates provided under section

19 504(b)(1)(A) of title 5 for expert witnesses; or

20 ‘‘(B) costs for attorney’s fees that exceed the rates

21 provided for attorneys under section 504(b)(1)(A) of

22 title 5.

23 ‘‘(3) If the Comptroller General recommends under

24 paragraph (1) that a Federal agency pay costs to an inter25 ested party, the Federal agency shall—
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1 ‘‘(A) pay the costs promptly; or

2 ‘‘(B) if the Federal agency does not make such

3 payment, promptly report to the Comptroller General

4 the reasons for the failure to follow the Comptroller

5 General’s recommendation.

6 ‘‘(4) If the Comptroller General recommends under

7 paragraph (1) that a Federal agency pay costs to an inter8 ested party, the Federal agency and the interested party

9 shall attempt to reach an agreement on the amount of the

10 costs to be paid. If the Federal agency and the interested

11 party are unable to agree on the amount to be paid, the

12 Comptroller General may, upon the request of the interested

13 party, recommend to the Federal agency the amount of the

14 costs that the Federal agency should pay.’’; and

15 (C) by striking out subsection (e) and in16 serting in lieu thereof the following:

17 ‘‘(e)(1) The Comptroller General shall report promptly

18 to the Committee on Governmental Affairs and the Commit19 tee on Appropriations of the Senate and to the Committee

20 on Government Operations and the Committee on Appro21 priations of the House of Representatives any case in which

22 a Federal agency fails to implement fully a recommenda23 tion of the Comptroller General under subsection (b) or (c).

24 The report shall include—
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1 ‘‘(A) a comprehensive review of the pertinent

2 procurement, including the circumstances of the fail3 ure of the Federal agency to implement a rec4 ommendation of the Comptroller General; and

5 ‘‘(B) a recommendation regarding whether, in

6 order to correct an inequity or to preserve the integ7 rity of the procurement process, the Congress should

8 consider—

9 ‘‘(i) private relief legislation;

10 ‘‘(ii) legislative rescission or cancellation of

11 funds;

12 ‘‘(iii) further investigation by Congress; or

13 ‘‘(iv) other action.

14 ‘‘(2) Not later than January 31 of each year, the

15 Comptroller General shall transmit to the Congress a report

16 containing a summary of each instance in which a Federal

17 agency did not fully implement a recommendation of the

18 Comptroller General under subsection (b) or (c) during the

19 preceding year. The report shall also describe each instance

20 in which a final decision in a protest was not rendered

21 within 125 days after the date the protest is submitted to

22 the Comptroller General.’’.

23 (2) REQUIREMENT FOR PAYMENT IN ACCORD24 ANCE WITH PRIOR GAO DETERMINATIONS.—Costs to

25 which the Comptroller General declared an interested
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1 party to be entitled under section 3554 of title 31,

2 United States Code, as in effect immediately before

3 the enactment of this Act, shall, if not paid or other4 wise satisfied by the Federal agency concerned before

5 the date of the enactment of this Act, be paid prompt6 ly.

7 SEC. 1404. REGULATIONS.

8 (a) COMPUTATION OF PERIODS.—Section 3555 of title

9 31, United States Code, is amended—

10 (1) by redesignating subsection (b) as subsection

11 (d); and

12 (2) by inserting after subsection (a) the following

13 new subsection (b):

14 ‘‘(b) The procedures shall provide that, in the computa15 tion of any period described in this subchapter—

16 ‘‘(1) the day of the act, event, or default from

17 which the designated period of time begins to run not

18 be included; and

19 ‘‘(2) the last day after such act, event, or default

20 be included, unless—

21 ‘‘(A) such last day is a Saturday, a Sun22 day, or a legal holiday; or

23 ‘‘(B) in the case of a filing of a paper at

24 the General Accounting Office or a Federal agen25 cy, such last day is a day on which weather or
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1 other conditions cause the closing of the General

2 Accounting Office or Federal agency, in which

3 event the next day that is not a Saturday, Sun4 day, or legal holiday shall be included.’’.

5 (b) ELECTRONIC FILINGS AND DISSEMINATIONS.—

6 Such section, as amended by subsection (a), is further

7 amended by inserting after subsection (b) the following new

8 subsection:

9 ‘‘(c) The Comptroller General may prescribe proce10 dures for the electronic filing and dissemination of docu11 ments and information required under this subchapter. In

12 prescribing such procedures, the Comptroller General shall

13 consider the ability of all parties to achieve electronic access

14 to such documents and records.’’.

15 (c) REPEAL OF OBSOLETE DEADLINE.—Subsection (a)

16 of such section is amended by striking out ‘‘Not later than

17 January 15, 1985, the’’ and inserting in lieu thereof ‘‘The’’.

18 PART II—PROTESTS IN THE FEDERAL COURTS

19 SEC. 1421. NONEXCLUSIVITY OF REMEDIES.

20 Section 3556 of title 31, United States Code, is amend21 ed by striking out ‘‘a district court of the United States

22 or the United States Claims Court’’ in the first sentence

23 and inserting in lieu thereof ‘‘the United States Court of

24 Federal Claims’’.
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1 SEC. 1422. JURISDICTION OF THE UNITED STATES COURT

2 OF FEDERAL CLAIMS.

3 (a) CLAIMS AGAINST THE UNITED STATES AND BID

4 PROTESTS.—Section 1491 of title 28, United States Code,

5 is amended—

6 (1) by redesignating subsection (b) as subsection

7 (e);

8 (2) in subsection (a)—

9 (A) by striking out ‘‘(a)(1)’’ and inserting

10 in lieu thereof ‘‘(a) CLAIMS AGAINST THE

11 UNITED STATES.—’’;

12 (B) in paragraph (2), by striking out ‘‘(2)

13 To’’ and inserting in lieu thereof ‘‘(b) REMEDY

14 AND RELIEF.—To’’; and

15 (C) by striking out paragraph (3); and

16 (3) by inserting after subsection (b), as des17 ignated by paragraph (2)(B), the following new sub18 section (c):

19 ‘‘(c) BID PROTESTS.—(1) The United States Court of

20 Federal Claims has jurisdiction to render judgment on an

21 action by an interested party objecting to a solicitation by

22 a Federal agency for bids or proposals for a proposed con23 tract or to a proposed award or the award of a contract.

24 The court has jurisdiction to entertain such an action with25 out regard to whether suit is instituted before or after the

26 contract is awarded.
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1 ‘‘(2) To afford relief in such an action, the court may

2 award any relief that the court considers proper, including

3 declaratory and injunctive relief.

4 ‘‘(3) In exercising jurisdiction under this subsection,

5 the court shall give due regard to the interests of national

6 defense and national security and the need for expeditious

7 resolution of the action.

8 ‘‘(4) The district courts of the United States do not

9 have jurisdiction of any action referred to in paragraph

10 (1).’’.

11 (b) CLERICAL AMENDMENTS.—

12 (1) SECTION HEADING.—The heading of such sec13 tion is amended by inserting ‘‘BID PROTESTS;’’

14 after ‘‘GENERALLY;’’.

15 (2) TABLE OF SECTIONS.—The table of sections

16 at the beginning of chapter 91 of title 28, United

17 States Code, is amended by striking out the item re18 lating to section 1491 and inserting in lieu thereof the

19 following:

‘‘1491. Claims against United States generally; bid protests; actions involving

Tennessee Valley Authority.’’.
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1 PART III—PROTESTS IN PROCUREMENTS OF

2 AUTOMATIC DATA PROCESSING

3 SEC. 1431. REVOCATION OF DELEGATIONS OF PROCURE4 MENT AUTHORITY.

5 Section 111(b)(3) of the Federal Property and Admin6 istrative Services Act of 1949 (40 U.S.C. 759(b)(3)) is

7 amended by inserting after the third sentence the following:

8 ‘‘The Administrator may revoke a delegation of authority

9 with respect to a particular contract before or after award

10 of the contract, except that the Administrator may revoke

11 a delegation after the contract is awarded only when there

12 is a finding of a violation of law or regulation in connec13 tion with the contract award.’’.

14 SEC. 1432. AUTHORITY OF THE GENERAL SERVICES ADMIN15 ISTRATION BOARD OF CONTRACT APPEALS.

16 The first sentence of section 111(f)(1) of the Federal

17 Property and Administrative Services Act of 1949 (40

18 U.S.C. 759(f)(1)) is amended to read as follows: ‘‘Upon re19 quest of an interested party in connection with any pro20 curement that is subject to this section (including any such

21 procurement that is subject to delegation of procurement au22 thority), the board of contract appeals of the General Serv23 ices Administration (hereafter in this subsection referred to

24 as the ‘board’) shall review, as provided in this subsection,

25 any decision by a contracting officer that is alleged to vio-
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1 late a statute, a regulation, or the conditions of a delegation

2 of procurement authority.’’.

3 SEC. 1433. PERIODS FOR CERTAIN ACTIONS.

4 (a) SUSPENSION OF PROCUREMENT AUTHORITY.—

5 Section 111(f) of the Federal Property and Administrative

6 Services Act of 1949 (40 U.S.C. 759(f)) is amended—

7 (1) in paragraph (2) by adding at the end the

8 following new subparagraph:

9 ‘‘(C) If, in the case of a preaward protest, the board

10 suspends the procurement authority of the Administrator

11 or the Administrator’s delegation of procurement authority,

12 the Administrator or the delegate, as the case may be, may

13 continue with the procurement action up to, but not includ14 ing, the awarding of the contract if the Administrator or

15 the delegate, as the case may be, determines that it is in

16 the best interests of the United States to do so.’’; and

17 (2) in paragraph (3) by striking out subpara18 graph (A) and inserting in lieu thereof the following:

19 ‘‘(A)(i) If, with respect to an award of a contract, the

20 board receives notice of a protest under this subsection with21 in the period described in clause (ii), the board shall, at

22 the request of an interested party, hold a hearing to deter23 mine whether the board should suspend the procurement au24 thority of the Administrator or the Administrator’s delega-
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1 tion of procurement authority for the protested procurement

2 on an interim basis until the board can decide the protest.

3 ‘‘(ii) The period referred to in clause (i) is the period

4 beginning on the date on which the contract is awarded and

5 ending on the date that is 10 days after the date of the

6 contract award or, if later, the date that is 5 days after—

7 ‘‘(I) the debriefing date offered to an unsuccessful

8 offeror for any debriefing that is requested and, when

9 requested, is required; or

10 ‘‘(II) in the case of a contract for which no de11 briefing is required, the date on which the unsuccess12 ful offeror receives the notification of contract award.

13 ‘‘(iii) The board shall hold the requested hearing with14 in 5 days after the date of the filing of the protest or, in

15 the case of a request for debriefing under the provisions of

16 section 2305(b)(5) of title 10, United States Code, or section

17 303B(e) of this Act, within 5 days after the later of the

18 date of the filing of the protest or the date of the debrief19 ing.’’.

20 (b) FINAL DECISION.—Paragraph (4)(B) of such sec21 tion 111(f) is amended—

22 (1) by striking out ‘‘45 working days’’ and in23 serting in lieu thereof ‘‘65 days’’; and

24 (2) by adding at the end the following: ‘‘An

25 amendment which adds a new ground of protest
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1 should be resolved, to the maximum extent prac2 ticable, within the time limits established for resolu3 tion of the initial protest.’’.

4 SEC. 1434. DISMISSALS OF PROTESTS.

5 Section 111(f)(4) of the Federal Property and Admin6 istrative Services Act of 1949 (40 U.S.C. 759(f)(4)) is

7 amended by striking out subparagraph (C) and inserting

8 in lieu thereof the following:

9 ‘‘(C) The board may dismiss a protest that the board

10 determines—

11 ‘‘(i) is frivolous;

12 ‘‘(ii) has been brought in bad faith; or

13 ‘‘(iii) does not state on its face a valid basis for

14 protest.’’.

15 SEC. 1435. AWARD OF COSTS.

16 Section 111(f)(5) is amended by striking out subpara17 graph (C) and inserting in lieu thereof the following:

18 ‘‘(C) Whenever the board makes such a determination,

19 it may, in accordance with section 1304 of title 31, United

20 States Code, further declare an appropriate prevailing

21 party to be entitled to the cost of filing and pursuing the

22 protest (including reasonable attorney’s fees and consultant

23 and expert witness fees), and bid and proposal preparation.

24 However, no party may be declared entitled to costs for con25 sultant and expert witness fees that exceed the rates pro-
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1 vided under section 504(b)(1)(A) of title 5, United States

2 Code, for expert witnesses or to costs for attorney’s fees that

3 exceed the rates provided for attorneys under section

4 504(b)(1)(A) of title 5, United States Code.’’.

5 SEC. 1436. DISMISSAL AGREEMENTS.

6 Section 111(f)(5) of the Federal Property and Admin7 istrative Services Act of 1949 (40 U.S.C. 759(f)(5)) is

8 amended by adding at the end the following new subpara9 graphs:

10 ‘‘(D) Any agreement that provides for the dismissal

11 of a protest and involves a direct or indirect expenditure

12 of appropriated funds shall be submitted to the board and

13 shall be made a part of the public record (subject to any

14 protective order considered appropriate by the board) before

15 dismissal of the protest. If a Federal agency is a party to

16 a settlement agreement, the submission of the agreement

17 submitted to the board shall include a memorandum, signed

18 by the contracting officer concerned, that describes in detail

19 the procurement, the grounds for protest, the Federal Gov20 ernment’s position regarding the grounds for protest, the

21 terms of the settlement, and the agency’s position regarding

22 the propriety of the award or proposed award of the con23 tract at issue in the protest.

24 ‘‘(E) Payment of amounts due from an agency under

25 subparagraph (C) or under the terms of a settlement agree-
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1 ment under subparagraph (D) shall be made from the ap2 propriation made by section 1304 of title 31, United States

3 Code, for the payment of judgments. The Federal agency

4 concerned shall reimburse that appropriation account out

5 of funds available for the procurement.’’.

6 SEC. 1437. JURISDICTION OF DISTRICT COURTS.

7 Section 111(f)(6)(C) of the Federal Property and Ad8 ministrative Services Act of 1949 (40 U.S.C. 759(f)(6)(C))

9 is amended by striking out ‘‘a district court of the United

10 States or’’.

11 SEC. 1438. MATTERS TO BE COVERED IN REGULATIONS.

12 Section 111(f) of the Federal Property and Adminis13 trative Services Act of 1949 (40 U.S.C. 759(f)) is amended

14 by striking out paragraph (8) and inserting in lieu thereof

15 the following:

16 ‘‘(7)(A) The board shall adopt and issue such rules and

17 procedures as may be necessary to the expeditious disposi18 tion of protests filed under the authority of this subsection.

19 ‘‘(B) The procedures shall provide that, in the com20 putation of any period described in this subsection—

21 ‘‘(i) the day of the act, event, or default from

22 which the designated period of time begins to run not

23 be included; and

24 ‘‘(ii) the last day after such act, event, or default

25 be included, unless—
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1 ‘‘(I) such last day is a Saturday, a Sunday,

2 or a legal holiday; or

3 ‘‘(II) in the case of a filing of a paper at

4 the board, such last day is a day on which

5 weather or other conditions cause the closing of

6 the board or Federal agency, in which event the

7 next day that is not a Saturday, Sunday, or

8 legal holiday shall be included.

9 ‘‘(C) The procedures may provide for electronic filing

10 and dissemination of documents and information required

11 under this subsection and in so providing shall consider the

12 ability of all parties to achieve electronic access to such doc13 uments and records.

14 ‘‘(D) The procedures shall provide that if the board

15 expressly finds that a protest or a portion of a protest is

16 frivolous or has not been brought or pursued in good faith,

17 or that any person has willfully abused the board’s process

18 during the course of a protest, the board may impose appro19 priate procedural sanctions, including dismissal of the pro20 test.’’.

21 SEC. 1439. DEFINITIONS.

22 (a) PROTEST.—Section 111(f)(9)(A) of the Federal

23 Property and Administrative Services Act of 1949 (40

24 U.S.C. 759(f)(9)(A)) is amended to read as follows:
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1 ‘‘(A) the term ‘protest’ means a written objection

2 by an interested party—

3 ‘‘(i) to a solicitation or other request by a

4 Federal agency for offers for a contract for the

5 procurement of property or services;

6 ‘‘(ii) to the cancellation of such a solicita7 tion or other request;

8 ‘‘(iii) to an award or proposed award of

9 such a contract; or

10 ‘‘(iv) to a termination or cancellation of an

11 award of such a contract, if the written objection

12 contains an allegation that the termination or

13 cancellation is based in whole or in part on im14 proprieties concerning the award of the con15 tract;’’.

16 (b) PREVAILING PARTY.—Section 111(f)(9) of such Act

17 is amended—

18 (1) by striking out ‘‘and’’ at the end of subpara19 graph (A);

20 (2) by striking out the period at the end of sub21 paragraph (B) and inserting in lieu thereof ‘‘; and’’;

22 and

23 (3) by adding at the end the following new sub24 paragraph:
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1 ‘‘(C) the term ‘prevailing party’, with respect to

2 a determination of the board under paragraph (5)(B)

3 that a challenged action of a Federal agency violates

4 a statute or regulation or the conditions of a delega5 tion of procurement authority issued pursuant to this

6 section, means a party that demonstrated such viola7 tion.’’.

8 Subtitle E—Definitions and Other

9 Matters

10 PART I—ARMED SERVICES ACQUISITIONS

11 SEC. 1501. DEFINITIONS.

12 Section 2302 of title 10, United States Code, is amend13 ed—

14 (1) by striking out paragraphs (3), (4), (5), and

15 (7);

16 (2) by redesignating paragraph (6) as para17 graph (5); and

18 (3) by inserting after paragraph (2) the follow19 ing:

20 ‘‘(3) The terms ‘commercial item’, ‘full and open

21 competition’, ‘major system’, ‘nondevelopmental item’,

22 ‘procurement’, ‘procurement system’, ‘responsible

23 source’, ‘standards’, and ‘technical data’, have the

24 meanings given such terms in section 4 of the Office

25 of Federal Procurement Policy Act (41 U.S.C. 403).
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1 ‘‘(4) The term ‘simplified acquisition threshold’

2 has the meaning given that term in section 4 of the

3 Office of Federal Procurement Policy Act (41 U.S.C.

4 403), except that, in the case of any contract to be

5 awarded and performed, or purchase to be made, out6 side the United States in support of a contingency

7 operation, the term means an amount equal to two

8 times the amount specified for that term in section 4

9 of such Act.’’.

10 SEC. 1502. DELEGATION OF PROCUREMENT FUNCTIONS.

11 (a) CONSOLIDATION OF DELEGATION AUTHORITY.—

12 Section 2311 of title 10, United States Code, is amended

13 to read as follows:

14 ‘‘§ 2311. Delegation

15 ‘‘(a) IN GENERAL.—Except to the extent expressly pro16 hibited by another provision of law, the head of an agency

17 may delegate, subject to his direction, to any other officer

18 or official of that agency, any power under this chapter.

19 ‘‘(b) PROCUREMENTS FOR OR WITH OTHER AGEN20 CIES.—Subject to subsection (a), to facilitate the procure21 ment of property and services covered by this chapter by

22 each agency named in section 2303 of this title for any other

23 agency, and to facilitate joint procurement by those agen24 cies—
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1 ‘‘(1) the head of an agency may, within his

2 agency, delegate functions and assign responsibilities

3 relating to procurement;

4 ‘‘(2) the heads of two or more agencies may by

5 agreement delegate procurement functions and assign

6 procurement responsibilities from one agency to an7 other of those agencies or to an officer or civilian em8 ployee of another of those agencies; and

9 ‘‘(3) the heads of two or more agencies may cre10 ate joint or combined offices to exercise procurement

11 functions and responsibilities.

12 ‘‘(c) APPROVAL OF TERMINATIONS AND REDUCTIONS

13 OF JOINT ACQUISITION PROGRAMS.—(1) The Secretary of

14 Defense shall prescribe regulations that prohibit each mili15 tary department participating in a joint acquisition pro16 gram approved by the Under Secretary of Defense for Ac17 quisition and Technology from terminating or substantially

18 reducing its participation in such program without the ap19 proval of the Under Secretary.

20 ‘‘(2) The regulations shall include the following provi21 sions:

22 ‘‘(A) A requirement that, before any such termi23 nation or substantial reduction in participation is

24 approved, the proposed termination or reduction be
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1 reviewed by the Joint Requirements Oversight Council

2 of the Department of Defense.

3 ‘‘(B) A provision that authorizes the Under Sec4 retary of Defense for Acquisition and Technology to

5 require a military department approved for termi6 nation or substantial reduction in participation in a

7 joint acquisition program to continue to provide some

8 or all of the funding necessary for the acquisition pro9 gram to be continued in an efficient manner.’’.

10 (b) CONFORMING REPEAL.—(1) Section 2308 of title

11 10, United States Code, is repealed.

12 (2) The table of sections at the beginning of chapter

13 137 of such title is amended by striking out the item related

14 to section 2308.

15 SEC. 1503. DETERMINATIONS AND DECISIONS.

16 Section 2310 of title 10, United States Code, is amend17 ed to read as follows:

18 ‘‘§ 2310. Determinations and decisions

19 ‘‘(a) INDIVIDUAL OR CLASS DETERMINATIONS AND

20 DECISIONS AUTHORIZED.—Determinations and decisions

21 required to be made under this chapter by the head of an

22 agency may be made for an individual purchase or contract

23 or for a class of purchases or contracts. Such determinations

24 and decisions are final.
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1 ‘‘(b) WRITTEN FINDINGS REQUIRED.—(1) Each deter2 mination or decision under section 2306(e)(1), 2307(e), or

3 2313(d)(2) of this title shall be based on a written finding

4 by the person making the determination or decision. The

5 finding shall set out facts and circumstances that support

6 the determination or decision.

7 ‘‘(2) Each finding referred to in paragraph (1) shall

8 be final. The head of the agency making such finding shall

9 maintain a copy of the finding for not less than 6 years

10 after the date of the determination or decision.’’.

11 SEC. 1504. UNDEFINITIZED CONTRACTUAL ACTIONS: RE12 STRICTIONS.

13 (a) CLARIFICATION OF LIMITATION.—Subsection (b) of

14 section 2326 of title 10, United States Code, is amended—

15 (1) in the subsection caption, by striking out

16 ‘‘AND EXPENDITURE’’;

17 (2) in paragraph (1)(B), by striking out ‘‘or ex18 pended’’;

19 (3) in paragraph (2), by striking out ‘‘expend’’

20 and inserting in lieu thereof ‘‘obligate’’; and

21 (4) in paragraph (3)—

22 (A) by striking out ‘‘expended’’ and insert23 ing in lieu thereof ‘‘obligated’’; and

24 (B) by striking out ‘‘expend’’ and inserting

25 in lieu thereof ‘‘obligate’’.
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1 (b) WAIVER AUTHORITY.—Such subsection is amend2 ed—

3 (1) by redesignating paragraph (4) as para4 graph (5); and

5 (2) by inserting after paragraph (3) the follow6 ing new paragraph (4):

7 ‘‘(4) The head of an agency may waive the provisions

8 of this subsection with respect to a contract of that agency

9 if such head of an agency determines that the waiver is

10 necessary in order to support a contingency operation.’’.

11 (c) INAPPLICABILITY OF RESTRICTIONS TO CONTRACTS

12 WITHIN THE SIMPLIFIED ACQUISITION THRESHOLD.—Sec13 tion 2326(g)(1)(B) of title 10, United States Code, is

14 amended by striking out ‘‘small purchase threshold’’ and

15 inserting in lieu thereof ‘‘simplified acquisition threshold’’.

16 SEC. 1505. PRODUCTION SPECIAL TOOLING AND PRODUC17 TION SPECIAL TEST EQUIPMENT: CONTRACT

18 TERMS AND CONDITIONS.

19 (a) REPEAL.—Section 2329 of title 10, United States

20 Code, is repealed.

21 (b) TECHNICAL AMENDMENT.—The table of sections at

22 the beginning of chapter 137 of such title is amended by

23 striking out the item related to section 2329.
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1 SEC. 1506. REGULATIONS FOR BIDS.

2 Section 2381(a) of title 10, United States Code, is

3 amended by striking out ‘‘(a) The Secretary’’ and all that

4 follows through the end of paragraph (1) and inserting in

5 lieu thereof the following:

6 ‘‘(a) The Secretary of Defense or the Secretary of a

7 military department may—

8 ‘‘(1) prescribe regulations for the preparation,

9 submission, and opening of bids for contracts; and’’.

10 PART II—CIVILIAN AGENCY ACQUISITIONS

11 SEC. 1551. DEFINITIONS.

12 Section 309(c) of the Federal Property and Adminis13 trative Services Act of 1949 (41 U.S.C. 259(c)) is amended

14 by striking out ‘‘and ‘supplies’ ’’ and inserting in lieu there15 of ‘‘ ‘supplies’, ‘commercial item’, ‘nondevelopmental item’,

16 and ‘simplified acquisition threshold’ ’’.

17 SEC. 1552. DELEGATION OF PROCUREMENT FUNCTIONS.

18 (a) AUTHORITY.—Title III of the Federal Property

19 and Administrative Services Act of 1949 (41 U.S.C. 251

20 et seq.) is amended—

21 (1) by redesignating sections 309 and 310 as sec22 tions 312 and 313, respectively; and

23 (2) by inserting after section 308 the following

24 new section 309:
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1 ‘‘DELEGATION

2 ‘‘SEC. 309. (a) IN GENERAL.—Except to the extent ex3 pressly prohibited by another provision of law, an agency

4 head may delegate, subject to his direction, to any other

5 officer or official of that agency, any power under this title.

6 ‘‘(b) PROCUREMENTS FOR OR WITH OTHER AGEN7 CIES.—Subject to subsection (a), to facilitate the procure8 ment of property and services covered by this title by each

9 executive agency for any other executive agency, and to fa10 cilitate joint procurement by those executive agencies—

11 ‘‘(1) an agency head may, within his executive

12 agency, delegate functions and assign responsibilities

13 relating to procurement;

14 ‘‘(2) the heads of two or more executive agencies

15 may by agreement delegate procurement functions

16 and assign procurement responsibilities from one ex17 ecutive agency to another of those executive agencies

18 or to an officer or civilian employee of another of

19 those executive agencies; and

20 ‘‘(3) the heads of two or more executive agencies

21 may create joint or combined offices to exercise pro22 curement functions and responsibilities.’’.

23 (b) CLERICAL AMENDMENT.—The table of contents in

24 the first section of such Act is amended by striking out the
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1 items relating to sections 309 and 310 and inserting in lieu

2 thereof the following:

‘‘Sec. 309. Delegation.

‘‘Sec. 312. Definitions.

‘‘Sec. 313. Statutes not applicable.’’.

3 SEC. 1553. DETERMINATIONS AND DECISIONS.

4 (a) IN GENERAL.—Title III of the Federal Property

5 and Administrative Services Act of 1949 (41 U.S.C. 251

6 et seq.), as amended by section 1552, is further amended

7 by inserting after section 309 the following new section 310:

8 ‘‘DETERMINATIONS AND DECISIONS

9 ‘‘SEC. 310. (a) INDIVIDUAL OR CLASS DETERMINA10 TIONS AND DECISIONS AUTHORIZED.—Determinations and

11 decisions required to be made under this title by an agency

12 head may be made for an individual purchase or contract

13 or for a class of purchases or contracts. Such determinations

14 and decisions are final.

15 ‘‘(b) WRITTEN FINDINGS REQUIRED.—(1) Each deter16 mination under section 305(e) shall be based on a written

17 finding by the person making the determination or decision.

18 The finding shall set out facts and circumstances that sup19 port the determination or decision.

20 ‘‘(2) Each finding referred to in paragraph (1) shall

21 be final. The agency head making such finding shall main22 tain a copy of the finding for not less than 6 years after

23 the date of the determination or decision.’’.
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1 (b) CLERICAL AMENDMENT.—The table of contents in

2 the first section of such Act, as amended by section 1552,

3 is further amended by inserting after the item relating to

4 section 309 the following:

‘‘Sec. 310. Determinations and decisions.’’.

5 SEC. 1554. COOPERATIVE PURCHASING.

6 Subsection (b) of section 201 of the Federal Property

7 and Administrative Services Act of 1949 (40 U.S.C. 481),

8 is amended to read as follows:

9 ‘‘(b)(1) The Administrator shall, as far as practicable,

10 provide any of the services specified in subsection (a) of this

11 section to any other Federal agency, mixed-ownership Gov12 ernment corporation (as defined in section 9101 of title 31,

13 United States Code), or the District of Columbia, upon its

14 request.

15 ‘‘(2)(A) The Administrator may provide for the use of

16 Federal supply schedules or other contracts by any of the

17 following entities upon request:

18 ‘‘(i) A State, any department or agency of a

19 State, and any political subdivision of a State, in20 cluding a local government.

21 ‘‘(ii) The District of Columbia.

22 ‘‘(iii) The Commonwealth of Puerto Rico.

23 ‘‘(iv) The government of an Indian tribe (as de24 fined in section 4(e) of the Indian Self-Determination

25 and Education Assistance Act (25 U.S.C. 450b(e))).
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1 ‘‘(B) Subparagraph (A) may not be construed to au2 thorize an entity referred to in that subparagraph to order

3 existing stock or inventory from federally owned and oper4 ated, or federally owned and contractor operated, supply

5 depots, warehouses, or similar facilities.

6 ‘‘(3)(A) Upon the request of a qualified nonprofit agen7 cy for the blind or other severely handicapped that is to

8 provide a commodity or service to the Federal Government

9 under the Javits-Wagner-O’Day Act, the Administrator

10 may provide any of the services specified in subsection (a)

11 to such agency to the extent practicable.

12 ‘‘(B) A nonprofit agency receiving services under the

13 authority of subparagraph (A) shall use the services directly

14 in making or providing an approved commodity or ap15 proved service to the Federal Government.

16 ‘‘(C) In this paragraph:

17 ‘‘(i) The term ‘qualified nonprofit agency for the

18 blind or other severely handicapped’ means—

19 ‘‘(I) a qualified nonprofit agency for the

20 blind, as defined in section 5(3) of the Javits21 Wagner-O’Day Act (41 U.S.C. 48b(3)); and

22 ‘‘(II) a qualified nonprofit agency for other

23 severely handicapped, as defined in section 5(4)

24 of such Act (41 U.S.C. 48b(4)).
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1 ‘‘(ii) The terms ‘approved commodity’ and ‘ap2 proved service’ mean a commodity and a service, re3 spectively, that has been determined by the Committee

4 for Purchase from the Blind and Other Severely

5 Handicapped under section 2 of the Javits-Wagner6 O’Day Act (41 U.S.C. 47) to be suitable for procure7 ment by the Federal Government.

8 ‘‘(iii) The term ‘Javits-Wagner-O’Day Act’

9 means the Act entitled ‘An Act to create a Committee

10 on Purchases of Blind-made Products, and for other

11 purposes’, approved June 25, 1938 (41 U.S.C. 46–

12 48c), commonly referred to as the Wagner-O’Day Act,

13 that was revised and reenacted in the Act of June 23,

14 1971 (85 Stat. 77), commonly referred to as the Jav15 its-Wagner-O’Day Act.’’.

16 TITLE II—CONTRACT

17 ADMINISTRATION

18 Subtitle A—Contract Payment

19 PART I—ARMED SERVICES ACQUISITIONS

20 SEC. 2001. CONTRACT FINANCING.

21 (a) REORGANIZATION OF PRINCIPAL AUTHORITY PRO22 VISION.—Section 2307 of title 10, United States Code, is

23 amended—

24 (1) by striking out the section heading and in25 serting in lieu thereof the following:
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1 ‘‘§ 2307. Contract financing’’;

2 (2) by striking out ‘‘(a) The head of an agency’’

3 and inserting in lieu thereof ‘‘(b) PAYMENT AUTHOR4 ITY.—The head of an agency’’;

5 (3) by striking out ‘‘(b) Payments’’ and insert6 ing in lieu thereof ‘‘(d) PAYMENT AMOUNT.—Pay7 ments’’;

8 (4) by striking out ‘‘(c) Advance payments’’ and

9 inserting in lieu thereof ‘‘(e) SECURITY FOR ADVANCE

10 PAYMENTS.—Advance payments’’;

11 (5) by striking out ‘‘(d)(1) The Secretary of De12 fense’’ and inserting in lieu thereof ‘‘(f) CONDITIONS

13 FOR PROGRESS PAYMENTS.—(1) The Secretary of De14 fense’’; and

15 (6) by striking out ‘‘(e)(1) In any case’’ and in16 serting in lieu thereof ‘‘(h) ACTION IN CASE OF

17 FRAUD.—(1) In any case’’.

18 (b) FINANCING POLICY.—Such section, as amended by

19 subsection (a), is further amended by inserting after the sec20 tion heading the following new subsection (a):

21 ‘‘(a) POLICY.—Payments authorized under this section

22 and made for financing purposes should be made periodi23 cally or, when appropriate, on an advance basis and should

24 be so made in a timely manner to facilitate contract per25 formance while protecting the security interests of the Gov26 ernment. Government financing shall be provided only to
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1 the extent necessary to ensure prompt and efficient perform2 ance and only after the availability of private financing

3 is considered. A contractor’s use of funds received as con4 tract financing and the contractor’s financial condition

5 shall be monitored. If the contractor is a small business con6 cern, special attention shall be given to meeting the contrac7 tor’s financial need.’’.

8 (c) PERFORMANCE-BASED PAYMENTS.—Such section,

9 as amended by subsection (a), is further amended by insert10 ing after subsection (b) the following new subsection (c):

11 ‘‘(c) PERFORMANCE-BASED PAYMENTS.—Whenever

12 practicable, payments under subsection (b) shall be made

13 on any of the following bases:

14 ‘‘(1) Performance measured by objective, quan15 tifiable methods such as receipt of items by the Fed16 eral Government, work measurement, or statistical

17 process controls.

18 ‘‘(2) Accomplishment of events defined in the

19 program management plan.

20 ‘‘(3) Other quantifiable measures of results.’’.

21 (d) TERMINOLOGY CORRECTION.—Such section, as

22 amended by subsection (a)(2), is further amended in sub23 section (b)(2) by striking out ‘‘bid’’.

24 (e) EFFECTIVE DATE OF LIEN RELATED TO ADVANCE

25 PAYMENTS.—Such section, as amended by subsection
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1 (a)(4), is further amended in subsection (e) by inserting be2 fore the period at the end of the third sentence the following:

3 ‘‘and is effective immediately upon the first advancement

4 of funds without filing, notice, or any other action by the

5 United States’’.

6 (f) CONDITIONS FOR PROGRESS PAYMENTS.—Such

7 section, as amended by subsection (a)(5), is further amend8 ed in subsection (f)—

9 (1) in the first sentence of paragraph (1), by

10 striking out ‘‘work, which’’ and all that follows

11 through ‘‘accomplished’’ and inserting in lieu thereof

12 ‘‘work accomplished that meets standards established

13 under the contract’’; and

14 (2) by striking out paragraph (3) and inserting

15 in lieu thereof the following:

16 ‘‘(3) This subsection applies to a contract for an

17 amount equal to or greater than the simplified acquisition

18 threshold.’’.

19 (g) NAVY CONTRACTS.—Such section, as amended by

20 subsection (a)(5), is further amended by inserting after sub21 section (f) the following new subsection (g):

22 ‘‘(g) CERTAIN NAVY CONTRACTS.—(1) The Secretary

23 of the Navy shall provide that the rate for progress pay24 ments on any contract awarded by the Secretary for repair,
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1 maintenance, or overhaul of a naval vessel shall be not less

2 than—

3 ‘‘(A) 95 percent, in the case of firms considered

4 to be small businesses; and

5 ‘‘(B) 90 percent, in the case of all other firms.

6 ‘‘(2) The Secretary of the Navy may advance to private

7 salvage companies such funds as the Secretary considers

8 necessary to provide for the immediate financing of salvage

9 operations. Advances under this paragraph shall be made

10 on terms that the Secretary considers adequate for the pro11 tection of the United States.

12 ‘‘(3) The Secretary of the Navy shall ensure that, when

13 partial, progress, or other payments are made under a con14 tract for construction or conversion of a naval vessel, the

15 United States is secured by a lien upon work in progress

16 and on property acquired for performance of the contract

17 on account of all payments so made. The lien is paramount

18 to all other liens.’’.

19 (h) CONFORMING AND CLERICAL AMENDMENTS.—

20 (1) CROSS REFERENCE.—Such section, as

21 amended by subsection (a), is further amended in sub22 sections (d) and (e) by striking out ‘‘subsection (a)’’

23 and inserting in lieu thereof ‘‘subsection (b)’’.

24 (2) TABLE OF CONTENTS.—The table of sections

25 at the beginning of chapter 137 of title 10, United
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1 States Code, is amended by striking out the item re2 lating to section 2307 and inserting in lieu thereof the

3 following:

‘‘2307. Contract financing.’’.

4 (i) REPEAL OF SUPERSEDED PROVISIONS.—

5 (1) PROGRESS PAYMENTS UNDER CERTAIN NAVY

6 CONTRACTS.—

7 (A) REPEAL.—Section 7312 of title 10,

8 United States Code, is repealed.

9 (B) CLERICAL AMENDMENT.—The table of

10 sections at the beginning of chapter 633 of such

11 title is amended by striking out the item relating

12 to section 7312.

13 (2) ADVANCEMENT OF PAYMENTS FOR NAVY SAL14 VAGE OPERATIONS.—

15 (A) REPEAL.—Section 7364 of such title is

16 repealed.

17 (B) CLERICAL AMENDMENT.—The table of

18 sections at the beginning of chapter 637 of such

19 title is amended by striking out the item relating

20 to section 7364.

21 (3) PARTIAL PAYMENTS UNDER NAVY CON22 TRACTS.—

23 (A) REPEAL.—Section 7521 of such title is

24 repealed.
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1 (B) CLERICAL AMENDMENT.—The table of

2 sections at the beginning of chapter 645 of such

3 title is amended by striking out the item relating

4 to section 7521.

5 SEC. 2002. CONTRACTS: VOUCHERING PROCEDURES.

6 (a) REPEAL.—Section 2355 of title 10, United States

7 Code, is repealed.

8 (b) CLERICAL AMENDMENT.—The table of sections at

9 the beginning of chapter 139 of such title is amended by

10 striking out the item relating to section 2355.

11 PART II—CIVILIAN AGENCY ACQUISITIONS

12 SEC. 2051. CONTRACT FINANCING.

13 (a) REORGANIZATION OF PRINCIPAL AUTHORITY PRO14 VISION.—Section 305 of the Federal Property and Adminis15 trative Services Act of 1949 (41 U.S.C. 255) is amended—

16 (1) by striking out the section heading and in17 serting in lieu thereof the following:

18 ‘‘CONTRACT FINANCING’’;

19 (2) by striking out ‘‘(a) Any executive agency’’

20 and inserting in lieu thereof ‘‘(b) PAYMENT AUTHOR21 ITY.—Any executive agency’’;

22 (3) by striking out ‘‘(b) Payments’’ and insert23 ing in lieu thereof ‘‘(d) PAYMENT AMOUNT.—Pay24 ments’’; and
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1 (4) by striking out ‘‘(c) Advance payments’’ and

2 inserting in lieu thereof ‘‘(e) SECURITY FOR ADVANCE

3 PAYMENTS.—Advance payments’’.

4 (b) FINANCING POLICY.—Such section, as amended by

5 subsection (a), is further amended by inserting after the sec6 tion heading the following new subsection (a):

7 ‘‘(a) POLICY.—Payments authorized under this section

8 and made for financing purposes should be made periodi9 cally or, when appropriate, on an advance basis and should

10 be so made in a timely manner to facilitate contract per11 formance while protecting the security interests of the Gov12 ernment. Government financing shall be provided only to

13 the extent necessary to ensure prompt and efficient perform14 ance and only after the availability of private financing

15 is considered. A contractor’s use of funds received as con16 tract financing and the contractor’s financial condition

17 shall be monitored. If the contractor is a small business con18 cern, special attention shall be given to meeting the contrac19 tor’s financial need.’’.

20 (c) PERFORMANCE-BASED PAYMENTS.—Such section,

21 as amended by subsection (a), is further amended by insert22 ing after subsection (b) the following new subsection (c):

23 ‘‘(c) PERFORMANCE-BASED PAYMENTS.—Whenever

24 practicable, payments under subsection (b) shall be made

25 on any of the following bases:
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1 ‘‘(1) Performance measured by objective, quan2 tifiable methods such as receipt of items by the Fed3 eral Government, work measurement, or statistical

4 process controls.

5 ‘‘(2) Accomplishment of events defined in the

6 program management plan.

7 ‘‘(3) Other quantifiable measures of results.’’.

8 (d) TERMINOLOGY CORRECTION.—Such section, as

9 amended by subsection (a)(2), is further amended in sub10 section (b)(2) by striking out ‘‘bid’’.

11 (e) EFFECTIVE DATE OF LIEN RELATED TO ADVANCE

12 PAYMENTS.—Such section, as amended by subsection

13 (a)(4), is further amended in subsection (e) by inserting be14 fore the period at the end of the third sentence the following:

15 ‘‘and is effective immediately upon the first advancement

16 of funds without filing, notice, or any other action by the

17 United States’’.

18 (f) REVISION OF CIVILIAN AGENCY PROVISION TO EN19 SURE UNIFORM REQUIREMENTS FOR PROGRESS PAY20 MENTS.—

21 (1) IN GENERAL.—Such section, as amended by

22 subsection (a), is further amended by adding at the

23 end the following:

24 ‘‘(f) CONDITIONS FOR PROGRESS PAYMENTS.—(1) The

25 agency head shall ensure that any payment for work in
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1 progress (including materials, labor, and other items) under

2 a contract of an executive agency that provides for such

3 payments is commensurate with the work accomplished that

4 meets standards established under the contract. The contrac5 tor shall provide such information and evidence as the agen6 cy head determines necessary to permit the agency head to

7 carry out the preceding sentence.

8 ‘‘(2) The agency head shall ensure that progress pay9 ments referred to in paragraph (1) are not made for more

10 than 80 percent of the work accomplished under the contract

11 so long as the agency head has not made the contractual

12 terms, specifications, and price definite.

13 ‘‘(3) This subsection applies to a contract for an

14 amount equal to or greater than the simplified acquisition

15 threshold.

16 ‘‘(g) ACTION IN CASE OF FRAUD.—(1) In any case in

17 which the remedy coordination official of an executive agen18 cy finds that there is substantial evidence that the request

19 of a contractor for advance, partial, or progress payment

20 under a contract awarded by that executive agency is based

21 on fraud, the remedy coordination official shall recommend

22 that the agency head reduce or suspend further payments

23 to such contractor.

24 ‘‘(2) An agency head receiving a recommendation

25 under paragraph (1) in the case of a contractor’s request
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1 for payment under a contract shall determine whether there

2 is substantial evidence that the request is based on fraud.

3 Upon making such a determination, the agency head may

4 reduce or suspend further payments to the contractor under

5 such contract.

6 ‘‘(3) The extent of any reduction or suspension of pay7 ments by an agency head under paragraph (2) on the basis

8 of fraud shall be reasonably commensurate with the antici9 pated loss to the United States resulting from the fraud.

10 ‘‘(4) A written justification for each decision of the

11 agency head whether to reduce or suspend payments under

12 paragraph (2), and for each recommendation received by

13 the agency head in connection with such decision, shall be

14 prepared and be retained in the files of the executive agency.

15 ‘‘(5) Each agency head shall prescribe procedures to

16 ensure that, before the agency head decides to reduce or sus17 pend payments in the case of a contractor under paragraph

18 (2), the contractor is afforded notice of the proposed reduc19 tion or suspension and an opportunity to submit matters

20 to the head of the agency in response to such proposed reduc21 tion or suspension.

22 ‘‘(6) Not later than 180 days after the date on which

23 an agency head reduces or suspends payments to a contrac24 tor under paragraph (2), the remedy coordination official

25 of the executive agency shall—
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1 ‘‘(A) review the determination of fraud on which

2 the reduction or suspension is based; and

3 ‘‘(B) transmit a recommendation to the agency

4 head whether the suspension or reduction should con5 tinue.

6 ‘‘(7) Each agency head who receives recommendations

7 made by a remedy coordination official of the executive

8 agency to reduce or suspend payments under paragraph (2)

9 during a fiscal year shall prepare for such year a report

10 that contains the recommendations, the actions taken on the

11 recommendations and the reasons for such actions, and an

12 assessment of the effects of such actions on the Federal Gov13 ernment. Any such report shall be available to any Member

14 of Congress upon request.

15 ‘‘(8) An agency head may not delegate responsibilities

16 under this subsection to any person in a position below level

17 IV of the Executive Schedule.

18 ‘‘(9) In this subsection, the term ‘remedy coordination

19 official’, with respect to an executive agency, means the per20 son or entity in that executive agency who coordinates with21 in that executive agency the administration of criminal,

22 civil, administrative, and contractual remedies resulting

23 from investigations of fraud or corruption related to pro24 curement activities.’’.
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1 (2) RELATIONSHIP TO PROMPT PAYMENT RE2 QUIREMENTS.—The amendments made by paragraph

3 (1) are not intended to impair or modify procedures

4 required by the provisions of chapter 39 of title 31,

5 United States Code, and the regulations issued pursu6 ant to such provisions of law, that relate to progress

7 payment requests, as such procedures are in effect on

8 the date of the enactment of this Act.

9 (g) CONFORMING AND CLERICAL AMENDMENTS.—

10 (1) REFERENCE.—Section 305 of the Federal

11 Property and Administrative Services Act of 1949, as

12 amended by subsection (a), is further amended in sub13 sections (d) and (e) by striking out ‘‘subsection (a)’’

14 and inserting in lieu thereof ‘‘subsection (b)’’.

15 (2) TABLE OF CONTENTS.—The table of contents

16 in the first section of such Act is amended by striking

17 out the item relating to section 305 and inserting in

18 lieu thereof the following:

‘‘Sec. 305. Contract financing.’’.

19 Subtitle B—Cost Principles

20 PART I—ARMED SERVICES ACQUISITIONS

21 SEC. 2101. ALLOWABLE CONTRACT COSTS.

22 (a) COMPTROLLER GENERAL EVALUATION.—Section

23 2324 is amended by striking out subsection (l).
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1 (b) COVERED CONTRACT DEFINED.—Subsection (m) of

2 section 2324 of title 10, United States Code, is amended

3 to read as follows:

4 ‘‘(l)(1) In this section, the term ‘covered contract’

5 means a contract for an amount in excess of $500,000 that

6 is entered into by the Department of Defense, except that

7 such term does not include a fixed-price contract without

8 cost incentives.

9 ‘‘(2) Effective on October 1 of each year that is divis10 ible by 5, the amount set forth in paragraph (1) shall be

11 adjusted to the amount that is equal to the fiscal year 1994

12 constant dollar value of the amount set forth. An amount,

13 as so adjusted, that is not evenly divisible by $50,000 shall

14 be rounded to the nearest multiple of $50,000. In the case

15 of an amount that is evenly divisible by $25,000 but is not

16 evenly divisible by $50,000, the amount shall be rounded

17 to the next higher multiple of $50,000.’’.

18 SEC. 2102. CONTRACT PROFIT CONTROLS DURING EMER19 GENCY PERIODS.

20 (a) REPEAL.—Section 2382 of title 10, United States

21 Code, is repealed.

22 (b) CLERICAL AMENDMENT.—The table of sections at

23 the beginning of chapter 141 of such title is amended by

24 striking out the item relating to section 2382.
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1 PART II—CIVILIAN AGENCY ACQUISITIONS

2 SEC. 2151. ALLOWABLE CONTRACT COSTS.

3 (a) REVISION OF CIVILIAN AGENCY PROVISION TO EN4 SURE UNIFORM TREATMENT OF CONTRACT COSTS.—Sec5 tion 306 of the Federal Property and Administrative Serv6 ices Act of 1949 (41 U.S.C. 256) is amended to read as

7 follows:

8 ‘‘ALLOWABLE COSTS

9 ‘‘SEC. 306. (a) INDIRECT COST THAT VIOLATES A

10 FAR COST PRINCIPLE.—The head of an executive agency

11 shall require that a covered contract provide that if the con12 tractor submits to the executive agency a proposal for settle13 ment of indirect costs incurred by the contractor for any

14 period after such costs have been accrued and if that pro15 posal includes the submission of a cost which is unallowable

16 because the cost violates a cost principle in the Federal Ac17 quisition Regulation or an executive agency’s supplement

18 to the Federal Acquisition Regulation, the cost shall be dis19 allowed.

20 ‘‘(b) PENALTY FOR VIOLATION OF COST PRINCIPLE.—

21 (1) If the agency head determines that a cost submitted by

22 a contractor in its proposal for settlement is expressly unal23 lowable under a cost principle referred to in subsection (a)

24 that defines the allowability of specific selected costs, the

25 agency head shall assess a penalty against the contractor

26 in an amount equal to—
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1 ‘‘(A) the amount of the disallowed cost allocated

2 to covered contracts for which a proposal for settle3 ment of indirect costs has been submitted; plus

4 ‘‘(B) interest (to be computed based on regula5 tions issued by the agency head) to compensate the

6 United States for the use of any funds which a con7 tractor has been paid in excess of the amount to

8 which the contractor was entitled.

9 ‘‘(2) If the agency head determines that a proposal for

10 settlement of indirect costs submitted by a contractor in11 cludes a cost determined to be unallowable in the case of

12 such contractor before the submission of such proposal, the

13 agency head shall assess a penalty against the contractor

14 in an amount equal to two times the amount of the dis15 allowed cost allocated to covered contracts for which a pro16 posal for settlement of indirect costs has been submitted.

17 ‘‘(c) WAIVER OF PENALTY.—In accordance with the

18 Federal Acquisition Regulation, the agency head may waive

19 a penalty under subsection (b) in the case of a contractor’s

20 proposal for settlement of indirect costs when—

21 ‘‘(1) the contractor withdraws the proposal before

22 the formal initiation of an audit of the proposal by

23 the Federal Government and resubmits a revised pro24 posal;
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1 ‘‘(2) the amount of unallowable costs subject to

2 the penalty is insignificant; or

3 ‘‘(3) the contractor demonstrates, to the contract4 ing officer’s satisfaction, that—

5 ‘‘(A) it has established appropriate policies

6 and personnel training and an internal control

7 and review system that provide assurances that

8 unallowable costs subject to penalties are pre9 cluded from being included in the contractor’s

10 proposal for settlement of indirect costs; and

11 ‘‘(B) the unallowable costs subject to the

12 penalty were inadvertently incorporated into the

13 proposal.

14 ‘‘(d) APPLICABILITY OF CONTRACT DISPUTES PROCE15 DURE TO DISALLOWANCE OF COST AND ASSESSMENT OF

16 PENALTY.—An action of an agency head under subsection

17 (a) or (b)—

18 ‘‘(1) shall be considered a final decision for the

19 purposes of section 6 of the Contract Disputes Act of

20 1978 (41 U.S.C. 605); and

21 ‘‘(2) is appealable in the manner provided in

22 section 7 of such Act.

23 ‘‘(e) SPECIFIC COSTS NOT ALLOWABLE.—(1) The fol24 lowing costs are not allowable under a covered contract:
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1 ‘‘(A) Costs of entertainment, including amuse2 ment, diversion, and social activities, and any costs

3 directly associated with such costs (such as tickets to

4 shows or sports events, meals, lodging, rentals, trans5 portation, and gratuities).

6 ‘‘(B) Costs incurred to influence (directly or in7 directly) legislative action on any matter pending be8 fore Congress or a State legislature.

9 ‘‘(C) Costs incurred in defense of any civil or

10 criminal fraud proceeding or similar proceeding (in11 cluding filing of any false certification) brought by

12 the United States where the contractor is found liable

13 or had pleaded nolo contendere to a charge of fraud

14 or similar proceeding (including filing of a false cer15 tification).

16 ‘‘(D) Payments of fines and penalties resulting

17 from violations of, or failure to comply with, Federal,

18 State, local, or foreign laws and regulations, except

19 when incurred as a result of compliance with specific

20 terms and conditions of the contract or specific writ21 ten instructions from the contracting officer authoriz22 ing in advance such payments in accordance with the

23 Federal Acquisition Regulation.

24 ‘‘(E) Costs of membership in any social, dining,

25 or country club or organization.
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1 ‘‘(F) Costs of alcoholic beverages.

2 ‘‘(G) Contributions or donations, regardless of

3 the recipient.

4 ‘‘(H) Costs of advertising designed to promote

5 the contractor or its products.

6 ‘‘(I) Costs of promotional items and memora7 bilia, including models, gifts, and souvenirs.

8 ‘‘(J) Costs for travel by commercial aircraft

9 which exceed the amount of the standard commercial

10 fare.

11 ‘‘(K) Costs incurred in making any payment

12 (commonly known as a ‘golden parachute payment’)

13 which is—

14 ‘‘(i) in an amount in excess of the normal

15 severance pay paid by the contractor to an em16 ployee upon termination of employment; and

17 ‘‘(ii) is paid to the employee contingent

18 upon, and following, a change in management

19 control over, or ownership of, the contractor or a

20 substantial portion of the contractor’s assets.

21 ‘‘(L) Costs of commercial insurance that protects

22 against the costs of the contractor for correction of the

23 contractor’s own defects in materials or workmanship.

24 ‘‘(M) Costs of severance pay paid by the contrac25 tor to foreign nationals employed by the contractor
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1 under a service contract performed outside the United

2 States, to the extent that the amount of severance pay

3 paid in any case exceeds the amount paid in the in4 dustry involved under the customary or prevailing

5 practice for firms in that industry providing similar

6 services in the United States, as determined in ac7 cordance with the Federal Acquisition Regulation.

8 ‘‘(N) Costs of severance pay paid by the contrac9 tor to a foreign national employed by the contractor

10 under a service contract performed in a foreign coun11 try if the termination of the employment of the for12 eign national is the result of the closing of, or the cur13 tailment of activities at, a United States facility in

14 that country at the request of the government of that

15 country.

16 ‘‘(O) Costs incurred by a contractor in connec17 tion with any criminal, civil, or administrative pro18 ceeding commenced by the United States or a State,

19 to the extent provided in subsection (k).

20 ‘‘(2)(A) Subject to the availability of appropriations,

21 the head of an executive agency, in awarding a covered con22 tract, may waive in accordance with the Federal Acquisi23 tion Regulation the application of the provisions of para24 graphs (1)(M) and (1)(N) to that contract if the agency

25 head determines that—
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1 ‘‘(i) the application of such provisions to the

2 contract would adversely affect the continuation of a

3 program, project, or activity that provides significant

4 support services for employees of the executive agency

5 posted outside the United States;

6 ‘‘(ii) the contractor has taken (or has established

7 plans to take) appropriate actions within the contrac8 tor’s control to minimize the amount and number of

9 incidents of the payment of severance pay by the con10 tractor to employees under the contract who are for11 eign nationals; and

12 ‘‘(iii) the payment of severance pay is necessary

13 in order to comply with a law that is generally appli14 cable to a significant number of businesses in the

15 country in which the foreign national receiving the

16 payment performed services under the contract or is

17 necessary to comply with a collective bargaining

18 agreement.

19 ‘‘(B) The head of the executive agency concerned shall

20 include in the solicitation for a covered contract a statement

21 indicating—

22 ‘‘(i) that a waiver has been granted under sub23 paragraph (A) for the contract; or

24 ‘‘(ii) whether the agency head will consider

25 granting such a waiver, and, if the agency head will
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1 consider granting a waiver, the criteria to be used in

2 granting the waiver.

3 ‘‘(C) The agency head shall make the final determina4 tion regarding whether to grant a waiver under subpara5 graph (A) with respect to a covered contract before award

6 of the contract.

7 ‘‘(3) The head of each executive agency shall implement

8 this section with respect to contracts of that executive agen9 cy in accordance with the Federal Acquisition Regulation.

10 The provisions of the Federal Acquisition applicable to the

11 implementation of this section may include definitions, ex12 clusions, limitations, and qualifications.

13 ‘‘(f) REQUIRED REGULATIONS.—(1) The Federal Ac14 quisition Regulation referred to in section 25(c)(1) of the

15 Office of Federal Procurement Policy Act (41 U.S.C.

16 421(c)(1)) shall contain provisions on the allowability of

17 contractor costs. Such provisions shall define in detail and

18 in specific terms those costs which are unallowable, in whole

19 or in part, under covered contracts. The regulations shall,

20 at a minimum, clarify the cost principles applicable to con21 tractor costs of the following:

22 ‘‘(A) Air shows.

23 ‘‘(B) Membership in civic, community, and pro24 fessional organizations.

25 ‘‘(C) Recruitment.
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1 ‘‘(D) Employee morale and welfare.

2 ‘‘(E) Actions to influence (directly or indirectly)

3 executive branch action on regulatory and contract

4 matters (other than costs incurred in regard to con5 tract proposals pursuant to solicited or unsolicited

6 bids).

7 ‘‘(F) Community relations.

8 ‘‘(G) Dining facilities.

9 ‘‘(H) Professional and consulting services, in10 cluding legal services.

11 ‘‘(I) Compensation.

12 ‘‘(J) Selling and marketing.

13 ‘‘(K) Travel.

14 ‘‘(L) Public relations.

15 ‘‘(M) Hotel and meal expenses.

16 ‘‘(N) Expense of corporate aircraft.

17 ‘‘(O) Company-furnished automobiles.

18 ‘‘(P) Advertising.

19 ‘‘(2) The Federal Acquisition Regulation shall require

20 that a contracting officer not resolve any questioned costs

21 until the contracting officer has obtained—

22 ‘‘(A) adequate documentation with respect to

23 such costs; and

24 ‘‘(B) the opinion of the executive agency’s con25 tract auditor on the allowability of such costs.
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1 ‘‘(3) The Federal Acquisition Regulation shall provide

2 that, to the maximum extent practicable, an executive agen3 cy’s contract auditor be present at any negotiation or meet4 ing with the contractor regarding a determination of the

5 allowability of indirect costs of the contractor.

6 ‘‘(4) The Federal Acquisition Regulation shall require

7 that all categories of costs designated in the report of an

8 executive agency’s contract auditor as questioned with re9 spect to a proposal for settlement be resolved in such a man10 ner that the amount of the individual questioned costs that

11 are paid will be reflected in the settlement.

12 ‘‘(g) APPLICABILITY OF REQUIRED REGULATIONS TO

13 SUBCONTRACTORS.—The regulations prescribed to carry

14 out subsections (e) and (f)(1) shall require, to the maximum

15 extent practicable, that such regulations apply to all sub16 contractors of a covered contract.

17 ‘‘(h) CONTRACTOR CERTIFICATION REQUIRED.—(1) A

18 proposal for settlement of indirect costs applicable to a cov19 ered contract shall include a certification by an official of

20 the contractor that, to the best of the certifying official’s

21 knowledge and belief, all indirect costs included in the pro22 posal are allowable. Any such certification shall be in a

23 form prescribed by the agency head concerned.

24 ‘‘(2) The agency head concerned may, in an excep25 tional case, waive the requirement for certification under
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1 paragraph (1) in the case of any contract if the agency

2 head—

3 ‘‘(A) determines in such case that it would be in

4 the interest of the United States to waive such certifi5 cation; and

6 ‘‘(B) states in writing the reasons for that deter7 mination and makes such determination available to

8 the public.

9 ‘‘(i) PENALTIES FOR SUBMISSION OF COST KNOWN AS

10 NOT ALLOWABLE.—The submission to an executive agency

11 of a proposal for settlement of costs for any period after

12 such costs have been accrued that includes a cost that is

13 expressly specified by statute or regulation as being unal14 lowable, with the knowledge that such cost is unallowable,

15 shall be subject to the provisions of section 287 of title 18,

16 United States Code, and section 3729 of title 31, United

17 States Code.

18 ‘‘(j) CONTRACTOR TO HAVE BURDEN OF PROOF.—In

19 a proceeding before a board of contract appeals, the United

20 States Court of Federal Claims, or any other Federal court

21 in which the reasonableness of indirect costs for which a

22 contractor seeks reimbursement from the United States is

23 in issue, the burden of proof shall be upon the contractor

24 to establish that those costs are reasonable.
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1 ‘‘(k) PROCEEDING COSTS NOT ALLOWABLE.—(1) Ex2 cept as otherwise provided in this subsection, costs incurred

3 by a contractor in connection with any criminal, civil, or

4 administrative proceeding commenced by the United States

5 or a State are not allowable as reimbursable costs under

6 a covered contract if the proceeding (A) relates to a viola7 tion of, or failure to comply with, a Federal or State statute

8 or regulation, and (B) results in a disposition described in

9 paragraph (2).

10 ‘‘(2) A disposition referred to in paragraph (1)(B) is

11 any of the following:

12 ‘‘(A) In the case of a criminal proceeding, a con13 viction (including a conviction pursuant to a plea of

14 nolo contendere) by reason of the violation or failure

15 referred to in paragraph (1).

16 ‘‘(B) In the case of a civil or administrative pro17 ceeding involving an allegation of fraud or similar

18 misconduct, a determination of contractor liability on

19 the basis of the violation or failure referred to in

20 paragraph (1).

21 ‘‘(C) In the case of any civil or administrative

22 proceeding, the imposition of a monetary penalty by

23 reason of the violation or failure referred to in para24 graph (1).

25 ‘‘(D) A final decision—
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1 ‘‘(i) to debar or suspend the contractor,

2 ‘‘(ii) to rescind or void the contract, or

3 ‘‘(iii) to terminate the contract for default,

4 by reason of the violation or failure referred to in

5 paragraph (1).

6 ‘‘(E) A disposition of the proceeding by consent

7 or compromise if such action could have resulted in

8 a disposition described in subparagraph (A), (B), (C),

9 or (D).

10 ‘‘(3) In the case of a proceeding referred to in para11 graph (1) that is commenced by the United States and is

12 resolved by consent or compromise pursuant to an agree13 ment entered into by a contractor and the United States,

14 the costs incurred by the contractor in connection with such

15 proceeding that are otherwise not allowable as reimbursable

16 costs under such paragraph may be allowed to the extent

17 specifically provided in such agreement.

18 ‘‘(4) In the case of a proceeding referred to in para19 graph (1) that is commenced by a State, the agency head

20 that awarded the covered contract involved in the proceed21 ing may allow the costs incurred by the contractor in con22 nection with such proceeding as reimbursable costs if the

23 agency head determines, under regulations prescribed by

24 such agency head, that the costs were incurred as a result
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1 of (A) a specific term or condition of the contract, or (B)

2 specific written instructions of the agency.

3 ‘‘(5)(A) Except as provided in subparagraph (C), costs

4 incurred by a contractor in connection with a criminal,

5 civil, or administrative proceeding commenced by the Unit6 ed States or a State in connection with a covered contract

7 may be allowed as reimbursable costs under the contract

8 if such costs are not disallowable under paragraph (1), but

9 only to the extent provided in subparagraph (B).

10 ‘‘(B)(i) The amount of the costs allowable under sub11 paragraph (A) in any case may not exceed the amount

12 equal to 80 percent of the amount of the costs incurred, to

13 the extent that such costs are determined to be otherwise

14 allowable and allocable under the Federal Acquisition Regu15 lations.

16 ‘‘(ii) Regulations issued for the purpose of clause (i)

17 shall provide for appropriate consideration of the complex18 ity of procurement litigation, generally accepted principles

19 governing the award of legal fees in civil actions involving

20 the United States as a party, and such other factors as may

21 be appropriate.

22 ‘‘(C) In the case of a proceeding referred to in subpara23 graph (A), contractor costs otherwise allowable as reimburs24 able costs under this paragraph are not allowable if (i) such

25 proceeding involves the same contractor misconduct alleged
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1 as the basis of another criminal, civil, or administrative

2 proceeding, and (ii) the costs of such other proceeding are

3 not allowable under paragraph (1).

4 ‘‘(6) In this subsection:

5 ‘‘(A) The term ‘proceeding’ includes an inves6 tigation.

7 ‘‘(B) The term ‘costs’, with respect to a proceed8 ing—

9 ‘‘(i) means all costs incurred by a contrac10 tor, whether before or after the commencement of

11 any such proceeding; and

12 ‘‘(ii) includes—

13 ‘‘(I) administrative and clerical ex14 penses;

15 ‘‘(II) the cost of legal services, includ16 ing legal services performed by an employee

17 of the contractor;

18 ‘‘(III) the cost of the services of ac19 countants and consultants retained by the

20 contractor; and

21 ‘‘(IV) the pay of directors, officers, and

22 employees of the contractor for time devoted

23 by such directors, officers, and employees to

24 such proceeding.
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1 ‘‘(C) The term ‘penalty’ does not include restitu2 tion, reimbursement, or compensatory damages.

3 ‘‘(l) COVERED CONTRACT DEFINED.—(1) In this sec4 tion, the term ‘covered contract’ means a contract for an

5 amount in excess of $500,000 that is entered into by an

6 executive agency, except that such term does not include a

7 fixed-price contract without cost incentives.

8 ‘‘(2) Effective on October 1 of each year that is divis9 ible by 5, the amount set forth in paragraph (1) shall be

10 adjusted to the amount that is equal to the fiscal year 1994

11 constant dollar value of the amount set forth. An amount,

12 as so adjusted, that is not evenly divisible by $50,000 shall

13 be rounded to the nearest multiple of $50,000. In the case

14 of an amount that is evenly divisible by $25,000 but is not

15 evenly divisible by $50,000, the amount shall be rounded

16 to the next higher multiple of $50,000.’’.

17 (b) CLERICAL AMENDMENT.—The table of contents in

18 the first section of such Act is amended by striking out the

19 item relating to section 306 and inserting in lieu thereof

20 the following:

‘‘Sec. 306. Allowable costs.’’.

21 PART III—ACQUISITIONS GENERALLY

22 SEC. 2191. TRAVEL EXPENSES OF GOVERNMENT CONTRAC23 TORS.

24 Section 24 of the Office of Federal Procurement Policy

25 Act (41 U.S.C. 420) is repealed.
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1 Subtitle C—Audit and Access to

2 Records

3 PART I—ARMED SERVICES ACQUISITIONS

4 SEC. 2201. CONSOLIDATION AND REVISION OF AUTHORITY

5 TO EXAMINE RECORDS OF CONTRACTORS.

6 (a) AUTHORITY.—

7 (1) IN GENERAL.—Section 2313 of title 10, Unit8 ed States Code, is amended to read as follows:

9 ‘‘§ 2313. Examination of records of contractor

10 ‘‘(a) AGENCY AUTHORITY.—The head of an agency,

11 acting through an authorized representative—

12 ‘‘(1) is entitled to inspect the plant and audit

13 the records of—

14 ‘‘(A) a contractor performing a cost-reim15 bursement, incentive, time-and-materials, labor16 hour, or price-redeterminable contract, or any

17 combination of such contracts, made by that

18 agency under this chapter; and

19 ‘‘(B) a subcontractor performing any cost20 reimbursement, incentive, time-and-materials,

21 labor-hour, or price-redeterminable subcontract

22 under a contract referred to in subparagraph (A)

23 or under any combination of such contracts; and

24 ‘‘(2) shall, for the purpose of evaluating the accu25 racy, completeness, and currency of cost or pricing
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1 data required to be submitted pursuant to section

2 2306a of this title with respect to a contract or sub3 contract, have the right to examine all records of the

4 contractor or subcontractor related to—

5 ‘‘(A) the proposal for the contract or sub6 contract;

7 ‘‘(B) the discussions conducted on the pro8 posal;

9 ‘‘(C) pricing of the contract or subcontract;

10 or

11 ‘‘(D) performance of the contract or sub12 contract.

13 ‘‘(b) LIMITATION ON PREAWARD AUDITS RELATING TO

14 INDIRECT COSTS.—The head of an agency may not perform

15 a preaward audit to evaluate proposed indirect costs under

16 any contract, subcontract, or modification to be entered into

17 in accordance with this chapter in any case in which the

18 contracting officer determines that the objectives of the audit

19 can reasonably be met by accepting the results of an audit

20 conducted by any other department or agency of the Federal

21 Government within one year preceding the date of the con22 tracting officer’s determination.

23 ‘‘(c) SUBPOENA POWER.—(1) The Director of the De24 fense Contract Audit Agency (or any successor agency) may

25 require by subpoena the production of records of a contrac-
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1 tor, access to which is provided to the Secretary of Defense

2 or Secretary of a military department by subsection (a).

3 ‘‘(2) Any such subpoena, in the case of contumacy or

4 refusal to obey, shall be enforceable by order of an appro5 priate United States district court.

6 ‘‘(3) The authority provided by paragraph (1) may not

7 be redelegated.

8 ‘‘(4) The Director (or any successor official) shall sub9 mit an annual report to the Secretary of Defense on the

10 exercise of such authority during the preceding year and

11 the reasons why such authority was exercised in any in12 stance. The Secretary shall forward a copy of each such re13 port to the Committees on Armed Services of the Senate

14 and House of Representatives.

15 ‘‘(d) COMPTROLLER GENERAL AUTHORITY.—(1) Ex16 cept as provided in paragraph (2), each contract awarded

17 after using procedures other than sealed bid procedures shall

18 provide that the Comptroller General and his representa19 tives are entitled to examine any records of the contractor,

20 or any of its subcontractors, that directly pertain to, and

21 involve transactions relating to, the contract or subcontract.

22 ‘‘(2) Paragraph (1) does not apply to a contract or

23 subcontract with a foreign contractor or foreign subcontrac24 tor if the head of the agency concerned determines, with the

25 concurrence of the Comptroller General or his designee, that
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1 the application of that paragraph to the contract or sub2 contract would not be in the public interest. However, the

3 concurrence of the Comptroller General or his designee is

4 not required—

5 ‘‘(A) where the contractor or subcontractor is a

6 foreign government or agency thereof or is precluded

7 by the laws of the country involved from making its

8 records available for examination; and

9 ‘‘(B) where the head of the agency determines,

10 after taking into account the price and availability of

11 the property and services from United States sources,

12 that the public interest would be best served by not

13 applying paragraph (1).

14 ‘‘(3) Paragraph (1) may not be construed to require

15 a contractor or subcontractor to create or maintain any

16 record that the contractor or subcontractor does not main17 tain in the ordinary course of business or pursuant to an18 other provision of law.

19 ‘‘(e) LIMITATION.—The right of the head of an agency

20 under subsection (a), and the right of the Comptroller Gen21 eral under subsection (d), with respect to a contract or sub22 contract shall expire three years after final payment under

23 such contract or subcontract.
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1 ‘‘(f) INAPPLICABILITY TO CERTAIN CONTRACTS.—This

2 section is inapplicable with respect to the following con3 tracts:

4 ‘‘(1) Contracts for utility services at rates not ex5 ceeding those established to apply uniformly to the

6 public, plus any applicable reasonable connection

7 charge.

8 ‘‘(g) RECORDS DEFINED.—In this section, the term

9 ‘records’ includes books, documents, accounting procedures

10 and practices, and other data, regardless of type and re11 gardless of whether such items are in written form, in the

12 form of computer data, or in any other form.’’.

13 (2) CLERICAL AMENDMENT.—The item relating

14 to such section in the table of sections at the begin15 ning of chapter 137 of title 10, United States Code,

16 is amended to read as follows:

‘‘2313. Examination of records of contractor.’’.

17 (b) REPEAL OF SUPERSEDED PROVISION.—

18 (1) REPEAL.—Section 2406 of title 10, United

19 States Code, is repealed.

20 (2) CLERICAL AMENDMENT.—The table of sec21 tions at the beginning of chapter 141 of such title is

22 amended by striking out the item relating to section

23 2406.
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1 PART II—CIVILIAN AGENCY ACQUISITIONS

2 SEC. 2251. AUTHORITY TO EXAMINE RECORDS OF CONTRAC3 TORS.

4 (a) AUTHORITY.—

5 (1) IN GENERAL.—Title III of the Federal Prop6 erty and Administrative Services Act of 1949 (41

7 U.S.C. 251 et seq.), as amended by section 1251(a),

8 is further amended by inserting after section 304A the

9 following new section:

10 ‘‘EXAMINATION OF RECORDS OF CONTRACTOR

11 ‘‘SEC. 304B. (a) AGENCY AUTHORITY.—The head of

12 an executive agency, acting through an authorized rep13 resentative—

14 ‘‘(1) is entitled to inspect the plant and audit

15 the records of—

16 ‘‘(A) a contractor performing a cost-reim17 bursement, incentive, time-and-materials, labor18 hour, or price-redeterminable contract, or any

19 combination of such contracts, made by that ex20 ecutive agency under this title; and

21 ‘‘(B) a subcontractor performing any cost22 reimbursement, incentive, time-and-materials,

23 labor-hour, or price-redeterminable subcontract

24 under a contract referred to in subparagraph (A)

25 or under any combination of such contracts; and
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1 ‘‘(2) shall, for the purpose of evaluating the accu2 racy, completeness, and currency of cost or pricing

3 data required to be submitted pursuant to section

4 304A with respect to a contract or subcontract, have

5 the right to examine all records of the contractor or

6 subcontractor related to—

7 ‘‘(A) the proposal for the contract or sub8 contract;

9 ‘‘(B) the discussions conducted on the pro10 posal;

11 ‘‘(C) pricing of the contract or subcontract;

12 or

13 ‘‘(D) performance of the contract or sub14 contract.

15 ‘‘(b) LIMITATION ON PREAWARD AUDITS RELATING TO

16 INDIRECT COSTS.—The agency head may not perform a

17 preaward audit to evaluate proposed indirect costs under

18 any contract, subcontract, or modification to be entered into

19 in accordance with this title in any case in which the con20 tracting officer determines that the objectives of the audit

21 can reasonably be met by accepting the results of an audit

22 conducted by any other department or agency of the Federal

23 Government within one year preceding the date of the con24 tracting officer’s determination.
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1 ‘‘(c) SUBPOENA POWER.—(1) The agency head may re2 quire by subpoena the production of records of a contractor,

3 access to which is provided by subsection (a).

4 ‘‘(2) Any such subpoena, in the case of contumacy or

5 refusal to obey, shall be enforceable by order of an appro6 priate United States district court.

7 ‘‘(3) The authority provided by paragraph (1) may not

8 be delegated.

9 ‘‘(4) In the year following a year in which the head

10 of an executive agency exercises the authority provided in

11 paragraph (1), the agency head shall submit to the Commit12 tee on Governmental Affairs of the Senate and the Commit13 tee on Government Operations of the House of Representa14 tives a report on the exercise of such authority during such

15 preceding year and the reasons why such authority was ex16 ercised in any instance.

17 ‘‘(d) COMPTROLLER GENERAL AUTHORITY.—(1) Ex18 cept as provided in paragraph (2), each contract awarded

19 after using procedures other than sealed bid procedures shall

20 provide that the Comptroller General and his representa21 tives are entitled to examine any records of the contractor,

22 or any of its subcontractors, that directly pertain to, and

23 involve transactions relating to, the contract or subcontract.

24 ‘‘(2) Paragraph (1) does not apply to a contract or

25 subcontract with a foreign contractor or foreign subcontrac-
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1 tor if the agency head concerned determines, with the con2 currence of the Comptroller General or his designee, that

3 the application of that paragraph to the contract or sub4 contract would not be in the public interest. However, the

5 concurrence of the Comptroller General or his designee is

6 not required.

7 ‘‘(3) Paragraph (1) may not be construed to require

8 a contractor or subcontractor to create or maintain any

9 record that the contractor or subcontractor does not main10 tain in the ordinary course of business or pursuant to an11 other provision of law—

12 ‘‘(A) where the contractor or subcontractor is a

13 foreign government or agency thereof or is precluded

14 by the laws of the country involved from making its

15 records available for examination; and

16 ‘‘(B) where the agency head determines, after

17 taking into account the price and availability of the

18 property and services from United States sources, that

19 the public interest would be best served by not apply20 ing paragraph (1).

21 ‘‘(e) LIMITATION.—The right of an agency head under

22 subsection (a), and the right of the Comptroller General

23 under subsection (d), with respect to a contract or sub24 contract shall expire three years after final payment under

25 such contract or subcontract.
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1 ‘‘(f) INAPPLICABILITY TO CERTAIN CONTRACTS.—This

2 section is inapplicable with respect to the following con3 tracts:

4 ‘‘(1) CONTRACTS.—For utility services at rates

5 not exceeding those established to apply uniformly to

6 the public, plus any applicable reasonable connection

7 charge.

8 ‘‘(g) RECORDS DEFINED.—In this section, the term

9 ‘records’ includes books, documents, accounting procedures

10 and practices, and other data, regardless of type and re11 gardless of whether such items are in written form, in the

12 form of computer data, or in any other form.’’.

13 (2) CLERICAL AMENDMENT.—The table of con14 tents in the first section of such Act, as amended by

15 section 1251(b), is further amended by inserting after

16 the item relating to section 304A the following:

‘‘Sec. 304B. Examination of records of contractor.’’.

17 (b) REPEAL OF SUPERSEDED PROVISION.—Section

18 304 of the Federal Property and Administrative Services

19 Act of 1949 (41 U.S.C. 254) is amended by striking out

20 subsection (c).

21 Subtitle D—Cost Accounting

22 Standards

23 SEC. 2301. EXCEPTIONS TO COVERAGE.

24 Section 26(f)(2) of the Office of Federal Procurement

25 Policy Act (41 U.S.C. 422(f)(2)) is amended—
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1 (1) by inserting ‘‘(A)’’ after ‘‘(2)’’;

2 (2) by striking out ‘‘, other than contracts or

3 subcontracts’’ and all that follows and inserting in

4 lieu thereof a period; and

5 (3) by inserting at the end the following:

6 ‘‘(B) Subparagraph (A) does not apply to the following

7 contracts or subcontracts:

8 ‘‘(i) Contracts or subcontracts where the price

9 negotiated is based on established catalog or market

10 prices of commercial items sold in substantial quan11 tities to the general public.

12 ‘‘(ii) Contracts or subcontracts where the price

13 negotiated is based on prices set by law or regulation.

14 ‘‘(iii) Any other firm fixed-price contract or sub15 contract for commercial items which is excepted from

16 the requirement to provide cost or pricing data pur17 suant to subsection (b) or (d) of section 2306a of title

18 10, United States Code, or subsection (b) or (d) of sec19 tion 304A of the Federal Property and Administra20 tive Services Act of 1949.

21 ‘‘(C) In this paragraph, the term ‘subcontract’ includes

22 a transfer of commercial items between divisions, subsidi23 aries, or affiliates of a contractor.’’.
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1 SEC. 2302. REPEAL OF OBSOLETE DEADLINE REGARDING

2 PROCEDURAL REGULATIONS FOR THE COST

3 ACCOUNTING STANDARDS BOARD.

4 Section 26(f)(3) of the Office of Federal Procurement

5 Policy Act (41 U.S.C. 422(f)(3)) is amended in the first

6 sentence by striking out ‘‘Not later than 180 days after the

7 date of the enactment of this section, the Administrator’’

8 and inserting in lieu thereof ‘‘The Administrator’’.

9 Subtitle E—Administration of Con10 tract Provisions Relating to

11 Price, Delivery, and Product

12 Quality

13 PART I—ARMED SERVICES ACQUISITIONS

14 SEC. 2401. PROCUREMENT OF CRITICAL AIRCRAFT AND

15 SHIP SPARE PARTS; QUALITY CONTROL.

16 (a) REPEAL.—Section 2383 of title 10, United States

17 Code, is repealed.

18 (b) CLERICAL AMENDMENT.—The table of sections at

19 the beginning of chapter 141 of such title is amended by

20 striking out the item relating to section 2383.

21 SEC. 2402. CONTRACTOR GUARANTEES REGARDING WEAP22 ON SYSTEMS.

23 Section 2403(h) of title 10, United States Code, is

24 amended—

25 (1) by redesignating paragraph (2) as para26 graph (3); and
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1 (2) by inserting after paragraph (1) the follow2 ing new paragraph (2):

3 ‘‘(2) The regulations shall include the following:

4 ‘‘(A) Guidelines for negotiating contractor guar5 antees that are reasonable and cost effective, as deter6 mined on the basis of the likelihood of defects and the

7 estimated cost of correcting such defects.

8 ‘‘(B) Procedures for administering contractor

9 guarantees.

10 ‘‘(C) Guidelines for determining the cases in

11 which it may be appropriate to waive the require12 ments of this section.’’.

13 PART II—ACQUISITIONS GENERALLY

14 SEC. 2451. SECTION 3737 OF THE REVISED STATUTES: EX15 PANSION OF AUTHORITY TO PROHIBIT

16 SETOFFS AGAINST ASSIGNEES; REORGANIZA17 TION OF SECTION; REVISION OF OBSOLETE

18 PROVISIONS.

19 Section 3737 of the Revised Statutes (41 U.S.C. 15)

20 is amended to read as follows:

21 ‘‘SEC. 3737. (a) No contract or order, or any interest

22 therein, shall be transferred by the party to whom such con23 tract or order is given to any other party, and any such

24 transfer shall cause the annulment of the contract or order

25 transferred, so far as the United States is concerned. All
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1 rights of action, however, for any breach of such contract

2 by the contracting parties, are reserved to the United States.

3 ‘‘(b) The provisions of subsection (a) shall not apply

4 in any case in which the moneys due or to become due from

5 the United States or from any agency or department there6 of, under a contract providing for payments aggregating

7 $1,000 or more, are assigned to a bank, trust company, or

8 other financing institution, including any Federal lending

9 agency, provided:

10 ‘‘(1) That, in the case of any contract entered

11 into after October 9, 1940, no claim shall be assigned

12 if it arises under a contract which forbids such as13 signment.

14 ‘‘(2) That, unless otherwise expressly permitted

15 by such contract, any such assignment shall cover all

16 amounts payable under such contract and not already

17 paid, shall not be made to more than one party, and

18 shall not be subject to further assignment, except that

19 any such assignment may be made to one party as

20 agent or trustee for two or more parties participating

21 in such financing.

22 ‘‘(3) That, in the event of any such assignment,

23 the assignee thereof shall file written notice of the as24 signment together with a true copy of the instrument

25 of the assignment with—
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1 ‘‘(A) the contracting officer or the head of

2 his department or agency;

3 ‘‘(B) the surety or sureties upon the bond or

4 bonds, if any, in connection with such contract;

5 and

6 ‘‘(C) the disbursing officer, if any, des7 ignated in such contract to make payment.

8 ‘‘(c) Notwithstanding any law to the contrary govern9 ing the validity of assignments, any assignment pursuant

10 to this section shall constitute a valid assignment for all

11 purposes.

12 ‘‘(d) In any case in which moneys due or to become

13 due under any contract are or have been assigned pursuant

14 to this section, no liability of any nature of the assignor

15 to the United States or any department or agency thereof,

16 whether arising from or independently of such contract,

17 shall create or impose any liability on the part of the as18 signee to make restitution, refund, or repayment to the

19 United States of any amount heretofore since July 1, 1950,

20 or hereafter received under the assignment.

21 ‘‘(e) Any contract of the Department of Defense, the

22 General Services Administration, the Department of En23 ergy, or any other department or agency of the United

24 States designated by the President, except any such contract

25 under which full payment has been made, may, upon a de-
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1 termination of need by the President, provide or be amend2 ed without consideration to provide that payments to be

3 made to the assignee of any moneys due or to become due

4 under such contract shall not be subject to reduction or

5 setoff. Each such determination of need shall be published

6 in the Federal Register.

7 ‘‘(f) If a provision described in subsection (e) or a pro8 vision to the same general effect has been at any time here9 tofore or is hereafter included or inserted in any such con10 tract, payments to be made thereafter to an assignee of any

11 moneys due or to become due under such contract shall not

12 be subject to reduction or setoff for any liability of any na13 ture of the assignor to the United States or any department

14 or agency thereof which arises independently of such con15 tract, or hereafter for any liability of the assignor on ac16 count of—

17 ‘‘(1) renegotiation under any renegotiation stat18 ute or under any statutory renegotiation article in

19 the contract;

20 ‘‘(2) fines;

21 ‘‘(3) penalties (which term does not include

22 amounts which may be collected or withheld from the

23 assignor in accordance with or for failure to comply

24 with the terms of the contract); or
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1 ‘‘(4) taxes, social security contributions, or the

2 withholding or non withholding of taxes or social se3 curity contributions, whether arising from or inde4 pendently of such contract.

5 ‘‘(g) Except as herein otherwise provided, nothing in

6 this section shall be deemed to affect or impair rights of

7 obligations heretofore accrued.’’.

8 SEC. 2452. REPEAL OF REQUIREMENT FOR DEPOSIT OF

9 CONTRACTS WITH GAO.

10 Section 3743 of the Revised Statutes (41 U.S.C. 20)

11 is repealed.

12 Subtitle F—Claims and Disputes

13 PART I—ARMED SERVICES ACQUISITIONS

14 SEC. 2501. CERTIFICATION OF CONTRACT CLAIMS.

15 (a) DOD CERTIFICATION REQUIREMENT IN CONFLICT

16 WITH GOVERNMENTWIDE REQUIREMENT.—

17 (1) INAPPLICABILITY OF REQUIREMENT TO CON18 TRACT CLAIMS.—Section 2410 of title 10, United

19 States Code, is amended to read as follows:

20 ‘‘§ 2410. Requests for equitable adjustment or other re21 lief: certification

22 ‘‘(a) CERTIFICATION REQUIREMENT.—A request for

23 equitable adjustment to contract terms or request for relief

24 under Public Law 85–804 (50 U.S.C. 1431 et seq.) that ex25 ceeds the simplified acquisition threshold may not be paid
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1 unless a person authorized to certify the request on behalf

2 of the contractor certifies, at the time the request is submit3 ted, that—

4 ‘‘(1) the request is made in good faith, and

5 ‘‘(2) the supporting data are accurate and com6 plete to the best of that person’s knowledge and be7 lief.’’.

8 (2) CLERICAL AMENDMENT.—The table of sec9 tions at the beginning of chapter 141 of such title is

10 amended by striking out the item relating to section

11 2410 and inserting in lieu thereof the following:

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

12 (b) RESTRICTION ON LEGISLATIVE PAYMENT OF

13 CLAIMS.—Section 2410 of title 10, United States Code, as

14 amended by subsection (a), is further amended by adding

15 at the end the following new subsection:

16 ‘‘(b) RESTRICTION ON LEGISLATIVE PAYMENT OF

17 CLAIMS.—In the case of a contract of an agency named in

18 section 2303(a) of this title, no provision of a law enacted

19 after September 30, 1994, that directs the payment of a par20 ticular claim under such contract, a particular request for

21 equitable adjustment to any term of such contract, or a par22 ticular request for relief under Public Law 85–804 (50

23 U.S.C. 1431 et seq.) regarding such contract may be imple24 mented unless such provision of law—

25 ‘‘(1) specifically refers to this subsection; and
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1 ‘‘(2) specifically states that this subsection does

2 not apply with respect to the payment directed by

3 that provision of law.’’.

4 (c) DEFINITION.—Section 2410, as amended by sub5 sections (a) and (b), is further amended by adding at the

6 end the following:

7 ‘‘(c) DEFINITION.—In this section, the term ‘simplified

8 acquisition threshold’ has the meaning given that term in

9 section 2302(4) of this title.’’.

10 (d) REPEAL OF RELATED PROVISIONS.—

11 (1) CERTIFICATION REGULATIONS FOR CONTRACT

12 CLAIMS EXCEEDING $100,000.—

13 (A) REPEAL.—Section 2410e of title 10,

14 United States Code, is repealed.

15 (B) CLERICAL AMENDMENT.—The table of

16 sections at the beginning of chapter 141 of such

17 title is amended by striking out the item relating

18 to section 2410e.

19 (2) CONFORMING REPEAL.—Section 813(b) of the

20 National Defense Authorization Act for Fiscal Year

21 1993 (Public Law 102–484, 106 Stat. 2453), is re22 pealed.

23 SEC. 2502. SHIPBUILDING CLAIMS.

24 (a) LIMITATION ON PERIOD FOR SUBMISSION.—
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1 (1) INCREASED PERIOD.—Subsection (a) of sec2 tion 2405 of title 10, United States Code, is amend3 ed—

4 (A) by striking out ‘‘after December 7,

5 1983,’’ and inserting in lieu thereof ‘‘on or after

6 the date of the enactment of the Federal Acquisi7 tion Streamlining Act of 1994’’; and

8 (B) by striking out ‘‘18 months’’ and insert9 ing in lieu thereof ‘‘6 years’’.

10 (2) SAVINGS PROVISION.—Notwithstanding the

11 6-year period provided in subsection (a) of section

12 2405 of title 10, United States Code, as amended by

13 paragraph (1), the period applicable under such sub14 section in the case of a shipbuilding contract entered

15 into after December 7, 1983, and before the date of the

16 enactment of the Federal Acquisition Streamlining

17 Act of 1994 shall continue to be 18 months.

18 (b) RESUBMISSION WITH CORRECTED CERTIFI19 CATION.—Subsection (c) of such section is repealed.

20 PART II—ACQUISITIONS GENERALLY

21 SEC. 2551. CLAIMS JURISDICTION OF UNITED STATES DIS22 TRICT COURTS AND THE UNITED STATES

23 COURT OF FEDERAL CLAIMS.

24 (a) CONCURRENT JURISDICTION OF UNITED STATES

25 DISTRICT COURTS UNDER THE LITTLE TUCKER ACT.—
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1 Subsection (a) of section 1346 of title 28, United States

2 Code, is amended to read as follows:

3 ‘‘(a)(1) The district courts shall have original jurisdic4 tion, concurrent with the United States Court of Federal

5 Claims, of any civil action against the United States for

6 the recovery of any internal-revenue tax alleged to have been

7 erroneously or illegally assessed or collected, or any penalty

8 claimed to have been collected without authority or any sum

9 alleged to have been excessive or in any manner wrongfully

10 collected under the internal-revenue laws.

11 ‘‘(2)(A) Except as provided in subparagraph (B), the

12 district courts shall have original jurisdiction, concurrent

13 with the United States Court of Federal Claims, of any

14 other civil action or claim against the United States, not

15 exceeding $10,000 in amount, founded either upon the Con16 stitution, or any Act of Congress, or any regulation of an

17 executive department, or upon any express or implied con18 tract with the United States, or for liquidated or unliqui19 dated damages in cases not sounding in tort.

20 ‘‘(B) The district courts shall not have jurisdiction

21 over any civil action or claim against the United States

22 or any Federal entity which relates in any manner to a

23 contract to which the Contract Disputes Act of 1978 (41

24 U.S.C. 601 et seq.) applies, including a claim that seeks

25 to establish the existence or nonexistence of such a contract,
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1 seeks to establish that such a contract is void, or seeks to

2 determine and construe the terms of such a contract. The

3 district courts do not have jurisdiction over any civil action

4 or claim described in the preceding sentence pursuant to

5 section 1331, 1334, or 1346(a)(2)(B) of this title, any provi6 sion of law giving a Federal entity the right to sue or be

7 sued in its own name, or any other provision of law.’’.

8 (b) JURISDICTION OF THE UNITED STATES COURT OF

9 FEDERAL CLAIMS UNDER THE TUCKER ACT.—Section

10 1491 of title 28, United States Code, as amended by section

11 1422, is further amended by inserting after subsection (c)

12 the following:

13 ‘‘(d)(1) The United States Court of Federal Claims

14 shall have jurisdiction over any civil action or claim

15 against the United States which relates in any manner to

16 a contract to which the Contract Disputes Act of 1978 (41

17 U.S.C. 601 et seq,) applies, including a civil action or claim

18 that seeks to establish the existence or nonexistence of such

19 a contract, seeks to establish that such contract is void, or

20 seeks to determine and construe the terms of any such con21 tract.

22 ‘‘(2) The jurisdiction of the United States Court of

23 Federal Claims is, pursuant to section 1346(a)(2)(B) of this

24 title, exclusive as to the district courts of the United

25 States.’’.
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1 SEC. 2552. CONTRACT DISPUTES ACT IMPROVEMENTS.

2 (a) PERIOD FOR FILING CLAIMS.—

3 (1) SIX-YEAR LIMITATION.—Section 6 of the Con4 tract Disputes Act of 1978 (41 U.S.C. 605) is amend5 ed in subsection (a) by inserting after the second sen6 tence the following: ‘‘Each claim by a contractor

7 against the government relating to a contract and

8 each claim by the government against a contractor re9 lating to a contract shall be submitted within 6 years

10 after the occurrence of the event or events giving rise

11 to the claim. The preceding sentence does not apply

12 to a claim by the government against a contractor

13 that is based on a claim by the contractor involving

14 fraud.’’.

15 (2) LIMITATION ON APPLICABILITY TO EXISTING

16 CONTRACTS.—Notwithstanding the third sentence of

17 section 6(a) of the Contract Disputes Act of 1978, as

18 added by paragraph (1), if a contract in existence on

19 the date of the enactment of this Act requires that a

20 claim referred to in that sentence be submitted earlier

21 than 6 years after the occurrence of the event or

22 events giving rise to the claim, then the claim shall

23 be submitted within the period required by the con24 tract. The preceding sentence does not apply to a

25 claim by the Federal Government against a contrac-
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1 tor that is based on a claim by the contractor involv2 ing fraud.

3 (b) INCREASED THRESHOLD FOR CERTIFICATION, DE4 CISION, AND NOTIFICATION REQUIREMENTS.—Subsection

5 (c) of such section is amended by striking out ‘‘$50,000’’

6 each place it appears and inserting in lieu thereof

7 ‘‘$100,000’’.

8 (c) INCREASED MAXIMUM FOR APPLICABILITY OF AC9 CELERATED PROCEDURES.—Section 8(f) of the Contract

10 Disputes Act of 1978 (41 U.S.C. 607(f)) is amended by

11 striking out ‘‘$50,000’’ in the first sentence and inserting

12 in lieu thereof ‘‘$150,000’’.

13 (d) INCREASED MAXIMUM FOR APPLICABILITY OF

14 SMALL CLAIMS PROCEDURE.—Section 9(a) of the Contract

15 Disputes Act of 1978 (41 U.S.C. 608(a)) is amended by

16 striking out ‘‘$10,000’’ in the first sentence and inserting

17 in lieu thereof ‘‘$50,000’’.

18 (e) REDUCED PERIOD FOR FILING ACTION IN COURT

19 OF FEDERAL CLAIMS.—Section 10(a)(3) of such Act (41

20 U.S.C. 609(a)(3)) is amended by striking out ‘‘twelve

21 months’’ and inserting in lieu thereof ‘‘90 days’’.
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1 SEC. 2553. EXTENSION OF ALTERNATIVE DISPUTE RESOLU2 TION AUTHORITY.

3 Section 6(e) of the Contracts Disputes Act of 1978 (41

4 U.S.C. 605(e)) is amended by striking out ‘‘October 1,

5 1995’’ and inserting in lieu thereof ‘‘October 1, 1999’’.

6 SEC. 2554. EXPEDITED RESOLUTION OF CONTRACT ADMIN7 ISTRATION COMPLAINTS.

8 (a) REGULATIONS REQUIRED.—The Federal Acquisi9 tion Regulation shall include provisions that require a con10 tracting officer—

11 (1) to make every reasonable effort to respond in

12 writing within 30 days to any written request for a

13 contracting officer’s decision with respect to a matter

14 relating to the administration of a contract that is re15 ceived from a small business concern; and

16 (2) in the event that the contracting officer is

17 unable to render a decision within the 30-day period,

18 to transmit to the contractor within such period a

19 written notification of a specific date by which the

20 contracting officer expects to reach a decision.

21 (b) RULE OF CONSTRUCTION.—Nothing in this provi22 sion shall be considered as creating any rights under the

23 Contract Disputes Act (41 U.S.C. 601 et seq.).

24 (c) DEFINITION.—In this section, the term ‘‘small busi25 ness concern’’ means a business concern that meets the re26 quirements of section 3(a) of the Small Business Act (15
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1 U.S.C. 632(a)) and the regulations promulgated pursuant

2 to that section.

3 TITLE III—SERVICE SPECIFIC

4 AND MAJOR SYSTEMS STATUTES

5 Subtitle A—Major Systems Statutes

6 SEC. 3001. REQUIREMENT FOR INDEPENDENT COST ESTI7 MATES AND MANPOWER ESTIMATES BEFORE

8 DEVELOPMENT OR PRODUCTION.

9 (a) CONTENT AND SUBMISSION OF ESTIMATES.—Sec10 tion 2434 of title 10, United States Code, is amended by

11 striking out subsection (b) and inserting in lieu thereof the

12 following:

13 ‘‘(b) REGULATIONS.—The Secretary of Defense shall

14 prescribe regulations governing the content and submission

15 of the estimates required by subsection (a). The regulations

16 shall require—

17 ‘‘(1) that the independent estimate of the cost of

18 a program—

19 ‘‘(A) be prepared by an office or other en20 tity that is not under the supervision, direction,

21 or control of the military department, Defense

22 Agency, or other component of the Department of

23 Defense that is directly responsible for carrying

24 out the development or acquisition of the pro25 gram; and
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1 ‘‘(B) include all costs of development, pro2 curement, and operations and support, without

3 regard to funding source or management control;

4 and

5 ‘‘(2) that the manpower estimate include the

6 total personnel required to train for, operate, main7 tain, and support the program upon full operational

8 deployment.’’.

9 (b) TERMINOLOGY CORRECTION.—Subsection (a) of

10 such section is amended by striking out ‘‘full-scale engineer11 ing development’’ and inserting in lieu thereof ‘‘engineering

12 and manufacturing development’’.

13 SEC. 3002. ENHANCED PROGRAM STABILITY.

14 (a) BASELINE DESCRIPTIONS AND DEVIATION RE15 PORTING.—Section 2435 of title 10, United States Code, is

16 amended—

17 (1) in subsection (a)—

18 (A) by striking out paragraph (2); and

19 (B) in paragraph (1)—

20 (i) by striking out ‘‘(1)’’; and

21 (ii) by redesignating subparagraphs

22 (A) and (B) as paragraphs (1) and (2), re23 spectively; and

24 (2) by striking out subsection (b) and inserting

25 in lieu thereof the following:
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1 ‘‘(b) REGULATIONS.—The Secretary of Defense shall

2 prescribe regulations governing—

3 ‘‘(1) the content of baseline descriptions, which

4 shall include the program cost, the program schedule,

5 and a program performance description;

6 ‘‘(2) the submission of reports on deviations of a

7 program from the baseline description by the program

8 manager to the Secretary of the military department

9 concerned and the Under Secretary of Defense for Ac10 quisition and Technology;

11 ‘‘(3) procedures for review of deviation reports

12 within the Department of Defense; and

13 ‘‘(4) procedures for submission and approval of

14 revised baseline descriptions.

15 ‘‘(c) BASELINE DESCRIPTION REQUIRED BEFORE OB16 LIGATION OF FUNDS.—(1) Except as provided in para17 graph (2), no amount appropriated or otherwise made

18 available to the Department of Defense may be obligated

19 for a major defense acquisition program before a baseline

20 description for the program is approved in accordance with

21 the procedures prescribed pursuant to subsection (b)(4).

22 ‘‘(2) An obligation otherwise prohibited by paragraph

23 (1) may be incurred if approved in advance by the Under

24 Secretary of Defense for Acquisition and Technology.’’.
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1 (b) TERMINOLOGY CORRECTION.—Subsection (a)(1) of

2 such section, as redesignated by subsection (a)(1)(B)(ii), is

3 amended by striking out ‘‘full-scale engineering develop4 ment’’ and inserting in lieu thereof ‘‘engineering and man5 ufacturing development’’.

6 SEC. 3003. REPEAL OF REQUIREMENT TO DESIGNATE CER7 TAIN MAJOR DEFENSE ACQUISITION PRO8 GRAMS AS DEFENSE ENTERPRISE PROGRAMS.

9 Section 809 of the National Defense Authorization Act

10 for Fiscal Year 1991 (Public Law 101–510; 10 U.S.C. 2430

11 note) is amended—

12 (1) by striking out subsection (d); and

13 (2) by redesignating subsections (e), (f), (g), and

14 (h) as subsections (d), (e), (f), and (g), respectively.

15 SEC. 3004. REPEAL OF REQUIREMENT FOR COMPETITIVE

16 PROTOTYPING IN MAJOR PROGRAMS.

17 (a) REPEAL.—Section 2438 of title 10, United States

18 Code, is repealed.

19 (b) CLERICAL AMENDMENT.—The table of sections at

20 the beginning of chapter 144 of such title is amended by

21 striking out the item relating to section 2438.
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1 SEC. 3005. REPEAL OF REQUIREMENT FOR COMPETITIVE

2 ALTERNATIVE SOURCES IN MAJOR PRO3 GRAMS.

4 (a) REPEAL.—Section 2439 of title 10, United States

5 Code, is repealed.

6 (b) CLERICAL AMENDMENT.—The table of sections at

7 the beginning of chapter 144 of such title is amended by

8 striking out the item relating to section 2439.

9 Subtitle B—Testing Statutes

10 SEC. 3011. DIRECTOR OF OPERATIONAL TEST AND EVALUA11 TION TO REPORT DIRECTLY TO SECRETARY

12 OF DEFENSE.

13 Section 139(c) of title 10, United States Code, is

14 amended by inserting after ‘‘(c)’’ the following: ‘‘The Direc15 tor reports directly, without intervening review or approval,

16 to the Secretary of Defense and Deputy Secretary of Defense

17 personally.’’.

18 SEC. 3012. RESPONSIBILITY OF DIRECTOR OF OPER19 ATIONAL TEST AND EVALUATION FOR LIVE

20 FIRE TESTING.

21 (a) CONDUCT OF LIVE FIRE TESTING.—Subsection (b)

22 of section 139 of title 10, United States Code, is amended—

23 (1) by striking out ‘‘and’’ at the end of para24 graph (4);

25 (2) by striking out the period at the end of para26 graph (5) and inserting in lieu thereof ‘‘; and’’; and
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1 (3) by adding at the end the following new para2 graph:

3 ‘‘(6) conduct the live fire testing activities of the

4 Department of Defense provided for under section

5 2366 of this title.’’.

6 (b) ANNUAL REPORT ON LIVE FIRE TESTING.—Sub7 section (f) of such section is amended by inserting ‘‘(includ8 ing live fire testing activities)’’ in the first sentence after

9 ‘‘operational test and evaluation activities’’.

10 SEC. 3013. REQUIREMENT FOR UNCLASSIFIED VERSION OF

11 ANNUAL REPORT ON OPERATIONAL TEST

12 AND EVALUATION.

13 Section 139(f) of title 10, United States Code, is

14 amended by inserting after the second sentence the following

15 new sentence: ‘‘If the Director submits the report to Con16 gress in a classified form, the Director shall concurrently

17 submit an unclassified version of the report to Congress.’’.

18 Subtitle C—Service Specific Laws

19 SEC. 3021. GRATUITOUS SERVICES OF OFFICERS OF CER20 TAIN RESERVE COMPONENTS.

21 Section 279 of title 10, United States Code, is amend22 ed—

23 (1) by striking out ‘‘Notwithstanding’’ and in24 serting in lieu thereof ‘‘(a) ACCEPTANCE BY SEC-
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1 RETARY OF A MILITARY DEPARTMENT.—Notwith2 standing’’; and

3 (2) by adding at the end the following new sub4 section:

5 ‘‘(b) ACCEPTANCE BY SECRETARY OF DEFENSE.—Not6 withstanding section 1342 of title 31, the Secretary of De7 fense may accept the gratuitous services of an officer of a

8 reserve component (other than an officer of the Army Na9 tional Guard of the United States or the Air National

10 Guard of the United States) in consultation upon matters

11 relating to the armed forces.’’.

12 SEC. 3022. AUTHORITY TO RENT SAMPLES, DRAWINGS, AND

13 OTHER INFORMATION TO OTHERS.

14 Subchapter V of chapter 148 of title 10, United States

15 Code, is amended in section 2541(a) by inserting ‘‘rent,’’

16 after ‘‘sell,’’ each place it appears in paragraphs (1) and

17 (2).

18 SEC. 3023. CIVIL RESERVE AIR FLEET.

19 (a) DEFINITIONS.—Section 9511 of title 10, United

20 States Code, is amended—

21 (1) in paragraph (1)—

22 (A) by inserting ‘‘ ‘civil aircraft’,’’ after

23 ‘‘ ‘person’,’’;

24 (B) by striking out ‘‘meaning’’ and insert25 ing in lieu thereof ‘‘meanings’’; and
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1 (C) by striking out ‘‘(49 U.S.C. 1301)’’ and

2 inserting in lieu thereof ‘‘(49 U.S.C. App.

3 1301)’’;

4 (2) in paragraph (2), by striking out ‘‘passenger5 cargo’’ and inserting in lieu thereof ‘‘passenger

6 cargo’’;

7 (3) in paragraph (3), by striking out ‘‘cargo-ca8 pable’’ and inserting in lieu thereof ‘‘cargo capable’’;

9 (4) by striking out paragraph (5) and inserting

10 in lieu thereof the following:

11 ‘‘(5) The term ‘cargo convertible aircraft’ means

12 a passenger aircraft equipped or designed so that all

13 or substantially all of the main deck of the aircraft

14 can be readily converted for the carriage of property

15 or mail.’’;

16 (5) by striking out paragraph (6);

17 (6) by redesignating paragraph (7) as para18 graph (6);

19 (7) by redesignating paragraph (8) as para20 graph (7) and—

21 (A) in subparagraph (A) of such paragraph,

22 by inserting ‘‘under section 9512 of this title’’

23 after ‘‘and who contracts with the Secretary’’;

24 (B) by striking out ‘‘or’’ at the end of such

25 subparagraph (A); and
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1 (C) by inserting before the period at the end

2 of such paragraph the following: ‘‘, or (C) who

3 owns or controls existing aircraft, or will own or

4 control new aircraft, and who contractually com5 mits all or some of such aircraft to the Civil Re6 serve Air Fleet’’;

7 (8) by redesignating paragraphs (9), (10), (11),

8 and (12) as paragraphs (8), (9), (10), and (11), re9 spectively; and

10 (9) in paragraph (11), as so redesignated—

11 (A) by striking out ‘‘interoperability’’ and

12 inserting in lieu thereof ‘‘compatibility’’; and

13 (B) by striking out ‘‘a cargo-convertible,

14 cargo-capable, or passenger-cargo combined air15 craft’’ and inserting in lieu thereof ‘‘an

16 aeromedical aircraft or a cargo convertible, cargo

17 capable, or passenger cargo combined aircraft’’.

18 (b) CONSOLIDATION OF PROVISIONS RELATING TO

19 CONTRACTUAL COMMITMENT OF AIRCRAFT.—Chapter 931

20 of such title is amended—

21 (1) by redesignating subsections (b) and (c) of

22 section 9512 as subsections (c) and (d), respectively;

23 (2) by redesignating subsection (a) of section

24 9513 as subsection (b), transferring such subsection
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1 (as so redesignated) to section 9512, and inserting

2 such subsection after subsection (a);

3 (3) by redesignating subsection (b) of section

4 9513 as subsection (e) and transferring such sub5 section (as so redesignated) to the end of section 9512;

6 (4) in subsection (c) of section 9512, as redesig7 nated by paragraph (1), by striking out ‘‘the terms

8 required by section 9513 of this title and’’;

9 (5) in subsection (e) of section 9512, as redesig10 nated and transferred to such section by paragraph

11 (3), by striking out ‘‘under section 9512 of this title’’

12 and inserting in lieu thereof ‘‘entered into under this

13 section’’; and

14 (6) by striking out the heading of section 9513.

15 (c) USE OF MILITARY INSTALLATIONS BY CONTRAC16 TORS.—

17 (1) AUTHORITY.—Such chapter, as amended by

18 subsection (b), is further amended by adding at the

19 end the following new section 9513:

20 ‘‘§ 9513. Use of military installations by Civil Reserve

21 Air Fleet contractors

22 ‘‘(a) CONTRACT AUTHORITY.—(1) The Secretary of the

23 Air Force—

24 ‘‘(A) may, by contract entered into with any

25 contractor, authorize such contractor to use one or
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1 more Air Force installations designated by the Sec2 retary; and

3 ‘‘(B) with the consent of the Secretary of another

4 military department, may, by contract entered into

5 with any contractor, authorize the contractor to use

6 one or more installations, designated by the Secretary

7 of the Air Force, that is under the jurisdiction of the

8 Secretary of such other military department.

9 ‘‘(2) The Secretary of the Air Force may include in

10 the contract such terms and conditions as the Secretary de11 termines appropriate to promote the national defense or to

12 protect the interests of the United States.

13 ‘‘(b) PURPOSES OF USE.—A contract entered into

14 under subsection (a) may authorize use of a designated in15 stallation as a weather alternate, a service stop not involv16 ing the enplaning or deplaning of passengers or cargo, or,

17 in the case of an installation within the United States, for

18 other commercial purposes. Notwithstanding any other pro19 vision of the law, the Secretary may establish different levels

20 and types of uses for different installations for commercial

21 operations not required by the Department of Defense and

22 may provide in contracts under subsection (a) for different

23 levels and types of uses by different contractors.

24 ‘‘(c) DISPOSITION OF PAYMENTS FOR USE.—Notwith25 standing any other provision of law, amounts collected from
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1 the contractor for landing fees, services, supplies, or other

2 charges authorized to be collected under the contract shall

3 be credited to the appropriations of the armed forces having

4 jurisdiction over the military installation to which the con5 tract pertains. Amounts so credited to an appropriation

6 shall be available for obligation for the same period as the

7 appropriation to which credited.

8 ‘‘(d) HOLD HARMLESS REQUIREMENT.—A contract

9 entered into under subsection (a) shall provide that the con10 tractor agrees to indemnify and hold harmless the United

11 States from all actions, suits, or claims of any sort resulting

12 from, relating to, or arising out of any activities conducted,

13 or services or supplies furnished, in connection with the

14 contract.

15 ‘‘(e) RESERVATION OF RIGHT TO EXCLUDE CONTRAC16 TOR.—A contract entered into under subsection (a) shall

17 provide that the Secretary or, in the case of an installation

18 under the jurisdiction of an armed force other than the Air

19 Force, the Secretary concerned may at any time and with20 out prior notice deny access to an installation designated

21 under the contract if military exigencies require such ac22 tion.’’.

23 (2) CLERICAL AMENDMENT.—The table of sec24 tions at the beginning of such chapter is amended by
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1 striking out the item relating to section 9513 and in2 serting in lieu thereof the following:

‘‘9513. Use of military installations by Civil Reserve Air Fleet contractors.’’.

3 SEC. 3024. EXCHANGE OF PERSONNEL.

4 (a) EXCHANGE AUTHORITY.—Subchapter II of chapter

5 138 of title 10, United States Code, is amended by adding

6 at the end the following new section:

7 ‘‘§ 2350k. Exchange of personnel

8 ‘‘(a) INTERNATIONAL EXCHANGE AGREEMENTS AU9 THORIZED.—Under regulations prescribed by the Secretary

10 of Defense, the Secretary and the secretaries of the military

11 departments are each authorized to enter into agreements

12 with the governments of foreign countries for the exchange

13 of military and civilian personnel of the Department of De14 fense and military and civilian personnel of the defense de15 partments or ministries of such foreign governments.

16 ‘‘(b) ASSIGNMENT OF PERSONNEL.—Pursuant to such

17 agreements, personnel of the foreign defense departments or

18 ministries may be assigned to positions in the Department

19 of Defense, and personnel of the Department of Defense may

20 be assigned to positions in foreign defense departments or

21 ministries. Agreements for the exchange of personnel en22 gaged in research and development activities may provide

23 for assignments to positions in private industry that sup24 port the defense departments or ministries. The specific po25 sitions and the individuals to be assigned must be accept-
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1 able to both the sending government and the host govern2 ment.

3 ‘‘(c) RECIPROCITY OF PERSONNEL QUALIFICATIONS

4 REQUIRED.—Each government shall be required under an

5 agreement authorized by subsection (a) to provide personnel

6 having qualifications, training, and skills that are essen7 tially equal to those of the personnel provided by the other

8 government.

9 ‘‘(d) PAYMENT OF PERSONNEL COSTS.—Each govern10 ment shall pay the salary, per diem, cost of living, travel,

11 cost of language or other training, and other costs (except

12 for cost of temporary duty directed by the host government

13 and costs incident to the use of host government facilities

14 in the performance of assigned duties) for its own personnel

15 in accordance with the laws and regulations of such govern16 ment that pertain to such matters.’’.

17 (b) CLERICAL AMENDMENT.—The table of sections at

18 the beginning of subchapter II of such chapter is amended

19 by adding at the end the following new item:

‘‘2350k. Exchange of personnel.’’.

20 SEC. 3025. SCIENTIFIC INVESTIGATION AND RESEARCH FOR

21 THE NAVY.

22 (a) REPEAL.—Section 7203 of title 10, United States

23 Code, is repealed.
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1 (b) CLERICAL AMENDMENT.—The table of sections at

2 the beginning of chapter 631 of such title is amended by

3 striking out the item relating to section 7203.

4 SEC. 3026. CONSTRUCTION OF COMBATANT AND ESCORT

5 VESSELS AND ASSIGNMENT OF VESSEL

6 PROJECTS.

7 (a) REPEAL OF OBSOLETE AND INTERNALLY INCON8 SISTENT PROVISIONS.—Section 7299a of title 10, United

9 States Code, is amended—

10 (1) by striking out subsection (a); and

11 (2) by redesignating subsections (b) and (c) as

12 subsections (a) and (b), respectively.

13 (b) CONFORMING AMENDMENT.—Subsection (b) of such

14 section, as redesignated by subsection (a)(2), is amended in

15 paragraph (2) by striking out ‘‘subsection (a) or’’.

16 SEC. 3027. REPEAL OF REQUIREMENT FOR CONSTRUCTION

17 OF VESSELS ON PACIFIC COAST.

18 (a) REPEAL.—Section 7302 of title 10, United States

19 Code, is repealed.

20 (b) CLERICAL AMENDMENT.—The table of sections at

21 the beginning of chapter 633 of such title is amended by

22 striking out the item relating to section 7302.
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1 SEC. 3028. AUTHORITY TO TRANSFER BY GIFT A VESSEL

2 STRICKEN FROM NAVAL VESSEL REGISTER.

3 Section 7306(a)(1) of title 10, United States Code, is

4 amended by inserting ‘‘Territory,’’ after ‘‘State,’’.

5 SEC. 3029. NAVAL SALVAGE FACILITIES.

6 Chapter 637 of title 10, United States Code, is amend7 ed—

8 (1) in section 7361—

9 (A) in subsection (a), by inserting ‘‘AU10 THORITY TO PROVIDE FACILITIES BY CONTRACT

11 OR OTHERWISE.—’’ after ‘‘(a)’’;

12 (B) in subsection (b), by inserting ‘‘CON13 TRACTS AFFECTING THE DEPARTMENT OF

14 TRANSPORTATION.—’’ after ‘‘(b)’’; and

15 (C) by striking out subsection (c) and in16 serting in lieu thereof the following new sub17 section (c):

18 ‘‘(c) LIMITATION ON TERM CONTRACTS.—Term con19 tracts may be entered into for purposes of this section only

20 after—

21 ‘‘(1) it has been demonstrated to the satisfaction

22 of the Secretary of the Navy that available commer23 cial salvage facilities are inadequate to meet national

24 defense requirements; and
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1 ‘‘(2) the Secretary of the Navy determines that

2 adequate public notice of intent to exercise the author3 ity under this subsection has been provided.’’;

4 (2) by designating the text of section 7362 as

5 subsection (d) and transferring such text, as so des6 ignated, to the end of section 7361 of title 10, United

7 States Code;

8 (3) in subsection (d) of section 7361 of such title,

9 as so designated and transferred, by inserting before

10 ‘‘The Secretary’’ the following: ‘‘COMMERCIAL USE OF

11 NAVAL VESSELS AND EQUIPMENT.—’’;

12 (4) by designating the text of section 7363 as

13 subsection (e) and transferring such text, as so des14 ignated, to the end of section 7361 of title 10, United

15 States Code;

16 (5) in subsection (e) of section 7361 of such title,

17 as so designated and transferred, by inserting before

18 ‘‘Before any salvage vessel’’ the following: ‘‘CONDI19 TIONS FOR TRANSFER OF EQUIPMENT.—’’;

20 (6) by designating the text of section 7365 as

21 subsection (f) and transferring such text, as so des22 ignated, to the end of section 7361 of title 10, United

23 States Code;

24 (7) in subsection (f) of section 7361 of such title,

25 as so designated and transferred, by inserting before
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1 ‘‘The Secretary’’ the following: ‘‘SETTLEMENT OF

2 CLAIMS.—’’;

3 (8) by designating the text of section 7367 as

4 subsection (g) and transferring such text, as so des5 ignated, to the end of section 7361 of title 10, United

6 States Code;

7 (9) in subsection (g) of section 7361 of such title,

8 as so designated and transferred—

9 (A) by inserting before ‘‘Money received’’

10 the following: ‘‘DISPOSITION OF RECEIPTS.—’’;

11 and

12 (B) by striking out ‘‘this chapter’’ in the

13 first sentence and inserting in lieu thereof ‘‘this

14 section’’;

15 (10) by striking out the section headings for sec16 tions 7362, 7363, 7365, and 7367;

17 (11) by striking out the heading for section 7361

18 and inserting in lieu thereof the following:

19 ‘‘§ 7361. Navy support for salvage operations’’;

20 and

21 (12) in the table of sections at the beginning of

22 such chapter—

23 (A) by striking out the item relating to sec24 tion 7361 and inserting in lieu thereof the fol25 lowing:

‘‘7361. Navy support for salvage operations.’’;
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1 and

2 (B) by striking out the items relating to sec3 tions 7362, 7363, 7365, and 7367.

4 Subtitle D—Department of Defense

5 Commercial and Industrial Ac6 tivities

7 SEC. 3051. FACTORIES AND ARSENALS: MANUFACTURE AT.

8 (a) CONSOLIDATION AND REVISION OF AUTHORITY.—

9 (1) AUTHORITY.—Subchapter V of chapter 148 of

10 title 10, United States Code is amended by adding at

11 the end the following:

12 ‘‘§ 2542. Factories and arsenals: manufacture at

13 ‘‘(a) The Secretary of Defense or the Secretary of a

14 military department may have supplies needed for the De15 partment of Defense or such military department, as the

16 case may be, made in factories or arsenals owned by the

17 United States.

18 ‘‘(b) The Secretary of Defense or the Secretary of the

19 military department concerned may abolish any United

20 States arsenal that such Secretary considers unnecessary.’’.

21 (2) TECHNICAL AMENDMENT.—The table of sec22 tions at the beginning of subchapter V of such chapter

23 is amended by adding at the end the following new

24 item:

‘‘2542. Factories and arsenals: manufacture at.’’.

25 (b) REPEAL OF SUPERSEDED AUTHORITY.—
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1 (1) ARMY AUTHORITY.—

2 (A) REPEAL.—Section 4532 of title 10,

3 United States Code, is repealed.

4 (B) CLERICAL AMENDMENT.—The table of

5 sections at the beginning of chapter 433 of such

6 title is amended by striking out the item relating

7 to section 4532.

8 (2) AIR FORCE AUTHORITY.—

9 (A) REPEAL.—Section 9532 of title 10,

10 United States Code, is repealed.

11 (B) CLERICAL AMENDMENT.—The table of

12 sections at the beginning of chapter 933 of such

13 title is amended by striking out the item relating

14 to section 9532.

15 SEC. 3052. ACCOUNTING REQUIREMENT FOR CONTRACTED

16 ADVISORY AND ASSISTANCE SERVICES.

17 (a) FUNDING TO BE IDENTIFIED IN BUDGET.—Sec18 tion 1105 of title 31, United States Code, is amended by

19 adding at the end the following new subsection:

20 ‘‘(g)(1) The Director of the Office of Management and

21 Budget shall establish the funding for advisory and assist22 ance services for each department and agency as a separate

23 object class in each budget annually submitted to the Con24 gress under this section.
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1 ‘‘(2)(A) In paragraph (1), except as provided in sub2 paragraph (B), the term ‘advisory and assistance services’

3 means the following services when provided by nongovern4 mental sources:

5 ‘‘(i) Management and professional support serv6 ices.

7 ‘‘(ii) Studies, analyses, and evaluations.

8 ‘‘(iii) Engineering and technical services.

9 ‘‘(B) In paragraph (1), the term ‘advisory and assist10 ance services’ does not include the following services:

11 ‘‘(i) Routine automated data processing and tele12 communications services (as defined in the Federal

13 Information Resources Management Regulation pre14 scribed by the Administrator of General Services) un15 less such services are an integral part of a contract

16 for the procurement of advisory and assistance serv17 ices.

18 ‘‘(ii) Architectural and engineering services.

19 ‘‘(iii) Technical support of research and develop20 ment activities.

21 ‘‘(iv) Research on basic mathematics or medical,

22 biological, physical, social, psychological, or other

23 phenomena.’’.

24 (b) REPEAL OF SOURCE LAW.—Section 512 of Public

25 Law 102–394 (106 Stat. 1826) is repealed.
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1 (c) REPEAL OF SUPERSEDED PROVISIONS.—

2 (1) TITLE 10.—

3 (A) REPEAL.—Section 2212 of title 10,

4 United States Code, is repealed.

5 (B) CLERICAL AMENDMENT.—The table of

6 sections at the beginning of chapter 131 of such

7 title is amended by striking out the item relating

8 to section 2212.

9 (2) TITLE 31.—

10 (A) REPEAL.—Section 1114 of title 31,

11 United States Code, is repealed.

12 (B) CLERICAL AMENDMENT.—The table of

13 sections at the beginning of chapter 11 of such

14 title is amended by striking out the item relating

15 to section 1114.

16 Subtitle E—Fuel- and Energy17 Related Laws

18 SEC. 3061. LIQUID FUELS AND NATURAL GAS: CONTRACTS

19 FOR STORAGE, HANDLING, OR DISTRIBUTION.

20 Section 2388(a) of title 10, United States Code, is

21 amended by striking out ‘‘liquid fuels and natural gas’’ and

22 inserting in lieu thereof ‘‘liquid fuels or natural gas’’.
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1 Subtitle F—Fiscal Statutes

2 SEC. 3071. DISBURSEMENT OF FUNDS OF MILITARY DE3 PARTMENT TO COVER OBLIGATIONS OF AN4 OTHER AGENCY OF DEPARTMENT OF DE5 FENSE.

6 Subsection (c)(2) of section 3321 of title 31, United

7 States Code, is amended by striking out ‘‘military depart8 ments of the’’ and inserting in lieu thereof ‘‘The’’.

9 Subtitle G—Miscellaneous

10 SEC. 3081. OBLIGATION OF FUNDS: LIMITATION.

11 Section 2202 of title 10, United States Code, is amend12 ed to read as follows:

13 ‘‘§ 2202. Obligation of funds: limitation

14 ‘‘The Secretary of Defense shall prescribe regulations

15 governing the performance within the Department of De16 fense of the procurement, production, warehousing, and

17 supply distribution functions, and related functions, of the

18 Department of Defense.’’.

19 SEC. 3082. REPEAL OF REQUIREMENTS REGARDING PROD20 UCT EVALUATION ACTIVITIES.

21 (a) REPEAL.—Section 2369 of title 10, United States

22 Code, is repealed.

23 (b) CLERICAL AMENDMENT.—The table of sections at

24 the beginning of chapter 139 of such title is amended by

25 striking out the item related to section 2369.
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1 SEC. 3083. CODIFICATION AND REVISION OF LIMITATION

2 ON LEASE OF VESSELS, AIRCRAFT, AND VEHI3 CLES.

4 (a) LIMITATION.—

5 (1) IN GENERAL.—Chapter 141 of title 10,

6 United States Code, is amended by adding at the end

7 the following new section:

8 ‘‘§ 2410l. Lease of vessels, aircraft, and vehicles

9 ‘‘The head of an agency named in paragraph (1), (2),

10 (3), or (4) of section 2303(a) of this title may not enter

11 into any contract with a term of 18 months or more, or

12 extend or renew any contract for a term of 18 months or

13 more, for any vessel, aircraft, or vehicle, through a lease,

14 charter, or similar agreement without previously having

15 considered all costs of such lease (including estimated termi16 nation liability) and determined in writing that such lease

17 is in the best interest of the Government.’’.

18 (2) CLERICAL AMENDMENT.—The table of sec19 tions at the beginning of such chapter is amended by

20 adding at the end the following:

‘‘2410l. Lease of vessels, aircraft, and vehicles.’’.

21 (b) REPEAL OF SUPERSEDED PROVISION.—Section

22 9081 of Public Law 101–165 (103 Stat. 1147; 10 U.S.C.

23 2401 note) is repealed.
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1 SEC. 3084. SOFT DRINK SUPPLIES FOR EXCHANGE STORES.

2 Section 2424 of title 10, United States Code, is amend3 ed by adding at the end the following new subsection:

4 ‘‘(c) Paragraphs (1) and (2) of subsection (b) do not

5 apply to contracts for the procurement of soft drinks that

6 are manufactured in the United States. The Secretary of

7 Defense shall prescribe in regulations the standards and

8 procedures for determining whether a particular drink is

9 a soft drink and whether the drink was manufactured in

10 the United States.’’.

11 SEC. 3085. REPEAL OF PREFERENCE FOR RECYCLED TONER

12 CARTRIDGES.

13 The following provisions of law, relating to a pref14 erence for procurement of recycled toner cartridges, are re15 pealed:

16 (1) Section 630 of Public Law 102–393 (106

17 Stat. 1773) and the provision of law set out in quotes

18 in that section (42 U.S.C. 6962(j)).

19 (2) Section 401 of Public Law 103–123 (107

20 Stat. 1238).
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1 TITLE IV—SIMPLIFIED ACQUISI2 TION THRESHOLD AND SO3 CIOECONOMIC, SMALL BUSI4 NESS, AND MISCELLANEOUS

5 LAWS

6 Subtitle A—Simplified Acquisition

7 Threshold

8 PART I—ESTABLISHMENT OF THRESHOLD

9 SEC. 4001. SIMPLIFIED ACQUISITION THRESHOLD.

10 (a) TERM DEFINED.—Section 4(11) of the Office of

11 Federal Procurement Policy Act (41 U.S.C. 403(11)) is

12 amended to read as follows:

13 ‘‘(11) The term ‘simplified acquisition threshold’

14 means $100,000.’’.

15 (b) INTERIM REPORTING RULE.—Until October 1,

16 1999, procuring activities shall continue to report procure17 ment awards with a dollar value of at least $25,000, but

18 less than $100,000, in conformity with the procedures for

19 the reporting of a contract award in excess of $25,000 that

20 were in effect on October 1, 1992.

21 PART II—SIMPLIFICATION OF PROCEDURES

22 SEC. 4011. SIMPLIFIED ACQUISITION PROCEDURES.

23 The Office of Federal Procurement Policy Act (41

24 U.S.C. 401 et seq.) is amended by adding at the end the

25 following new section:
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1 ‘‘SIMPLIFIED ACQUISITION PROCEDURES

2 ‘‘SEC. 29. (a) In order to promote efficiency and econ3 omy in contracting and to avoid unnecessary burdens for

4 agencies and contractors, the Federal Acquisition Regula5 tion shall provide for special simplified procedures for con6 tracts for acquisition of property and services that are not

7 in excess of the simplified acquisition threshold.

8 ‘‘(b) Regulations prescribed pursuant to subsection (a)

9 shall include the following provisions:

10 ‘‘(1) A provision that a contract with an antici11 pated value not in excess of $2,500 is not subject to

12 section 15(j) of the Small Business Act (15 U.S.C.

13 644(j)) and section 2 of title III of the Act of March

14 3, 1933 (commonly known as the ‘Buy America Act’)

15 (41 U.S.C. 10a et seq.).

16 ‘‘(2) A provision that a civilian or military offi17 cial, or employee of an agency, whose contracting au18 thority does not exceed $2,500 is not a procurement

19 official for the purposes of section 27 of this Act.

20 ‘‘(3) A provision that a purchase not in excess

21 of $2,500 may be made without obtaining competitive

22 quotations if the contracting officer determines that

23 the price for the purchase is reasonable.
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1 ‘‘(4) A requirement that purchases not in excess

2 of $2,500 be distributed equitably among qualified

3 suppliers.

4 ‘‘(c) A proposed purchase or contract for an amount

5 above the simplified acquisition threshold may not be di6 vided into several purchases or contracts for lesser amounts

7 in order to use the simplified acquisition procedures re8 quired by subsection (a).

9 ‘‘(d) In using simplified acquisition procedures, the

10 head of an executive agency shall promote competition to

11 the maximum extent practicable.’’.

12 SEC. 4012. SMALL BUSINESS RESERVATION.

13 Section 15(j) of the Small Business Act (15 U.S.C.

14 644(j)) is amended to read as follows:

15 ‘‘(j)(1) Each contract for the purchase of goods and

16 services that has an anticipated value in excess of $2,500

17 but not in excess of the simplified acquisition threshold and

18 that is subject to simplified acquisition procedures pre19 scribed pursuant to section 29 of the Office of Federal Pro20 curement Policy Act shall be reserved exclusively for small

21 business concerns unless the contracting officer is unable to

22 obtain offers from two or more small business concerns that

23 are competitive with market prices and are competitive

24 with regard to the quality and delivery of the goods or serv25 ices being purchased.
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1 ‘‘(2) In carrying out paragraph (1), a contracting offi2 cer shall consider a responsive offer timely received from

3 an eligible small business offeror.

4 ‘‘(3) Nothing in paragraph (1) shall be construed as

5 precluding an award of a contract with a value not in ex6 cess of the simplified acquisition threshold under the au7 thority of section 8(a) of this Act, section 2323 of title 10,

8 United States Code, or section 712 of the Business Oppor9 tunity Development Reform Act of 1988 (Public Law 100–

10 656; 15 U.S.C. 644 note).’’.

11 SEC. 4013. FAST PAYMENT UNDER SIMPLIFIED ACQUISI12 TION PROCEDURES.

13 (a) PAYMENT PROCEDURES.—The simplified acquisi14 tion procedures described in section 29(a) of the Office of

15 Federal Procurement Policy Act (as added by section 4011)

16 shall provide for use of the payment terms described in sub17 section (b), and for the disbursement of payment through

18 electronic fund transfer, whenever circumstances permit.

19 (b) REQUIRED PAYMENT TERMS.—The payment terms

20 for a purchase made pursuant to simplified acquisition pro21 cedures shall require payment, in accordance with the pro22 visions of chapter 39 of title 31, United States Code, within

23 15 days after the date of the receipt of a proper invoice

24 for products delivered or services performed, if—
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1 (1) in the case of a purchase of property, title to

2 the property will vest in the Government upon deliv3 ery of the property to the Government or to a common

4 carrier; and

5 (2) in the case of property or services for which

6 payment is due before the Government’s acceptance of

7 the property or services, the vendor provides commer8 cial or other appropriate warranties assuring that the

9 property or services purchased conform to the require10 ments set forth in the Government’s purchase offer.

11 SEC. 4014. PROCUREMENT NOTICE.

12 (a) CONTINUATION OF EXISTING NOTICE THRESH13 OLDS.—Subsection (a) of section 18 of the Office of Federal

14 Procurement Policy Act (41 U.S.C. 416) is amended—

15 (1) in paragraph (1), by striking out ‘‘the small

16 purchase threshold’’ each place it appears and insert17 ing in lieu thereof ‘‘$25,000’’; and

18 (2) in paragraph (3)(B), by inserting after

19 ‘‘(B)’’ the following: ‘‘in the case of a contract or

20 order expected to exceed the simplified acquisition

21 threshold,’’.

22 (b) CONTENT OF NOTICE.—Subsection (b) of such sec23 tion is amended—

24 (1) by striking out ‘‘and’’ at the end of para25 graph (4);
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1 (2) by striking out the period at the end of para2 graph (5) and inserting in lieu thereof a semicolon;

3 and

4 (3) by adding at the end the following:

5 ‘‘(6) in the case of a contract in an amount esti6 mated to exceed $25,000 but not to exceed the sim7 plified acquisition threshold—

8 ‘‘(A) a description of the procedures to be

9 used in awarding the contract; and

10 ‘‘(B) a statement specifying the periods for

11 prospective offerors and the contracting officer to

12 take the necessary preaward and award ac13 tions.’’.

14 (c) NOTICE UNDER THE SMALL BUSINESS ACT.—

15 (1) CONTINUATION OF EXISTING NOTICE

16 THRESHOLDS.—Subsection (e) of section 8 of the

17 Small Business Act (15 U.S.C. 637) is amended—

18 (A) in paragraph (1), by striking out ‘‘the

19 small purchase threshold’’ each place it appears

20 and inserting in lieu thereof ‘‘$25,000’’; and

21 (B) in paragraph (3)(B), by inserting after

22 ‘‘(B)’’ the following: ‘‘in the case of a contract or

23 order estimated to exceed the simplified acquisi24 tion threshold,’’.
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1 (2) CONTENT OF NOTICE.—Subsection (f) of such

2 section is amended—

3 (A) by striking out ‘‘and’’ at the end of

4 paragraph (4);

5 (B) by striking out the period at the end of

6 paragraph (5) and inserting in lieu thereof a

7 semicolon; and

8 (C) by adding at the end the following:

9 ‘‘(6) in the case of a contract in an amount esti10 mated to exceed the $25,000 but not to exceed the sim11 plified acquisition threshold—

12 ‘‘(A) a description of the procedures to be

13 used in awarding the contract; and

14 ‘‘(B) a statement specifying the periods for

15 prospective offerors and the contracting officer to

16 take the necessary preaward and award ac17 tions.’’.

18 SEC. 4015. ELECTRONIC COMMERCE FOR FEDERAL GOV19 ERNMENT PROCUREMENTS.

20 (a) DEVELOPMENT AND IMPLEMENTATION OF SYS21 TEM.—The Administrator for Federal Procurement Policy,

22 in consultation with the heads of appropriate Federal Gov23 ernment agencies having applicable technical and func24 tional expertise, may take appropriate steps to develop and

25 implement a Federal Governmentwide architecture or de-
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1 sign for electronic commerce that provides interoperability

2 among users.

3 (b) REQUIRED CAPABILITIES.—The requirements

4 analysis prepared to implement the architecture or design

5 of a system of electronic commerce referred to in subsection

6 (a) shall have the following capabilities:

7 (1) The maximum practicable capability for elec8 tronic exchange of such procurement information as

9 solicitations, offers, contracts, purchase orders, in10 voices, payments, and other contractual documents be11 tween the private sector and the Federal Government.

12 (2) Capabilities that increase the access of busi13 nesses, including small business concerns, socially and

14 economically disadvantaged small business concerns,

15 and businesses owned predominantly by women, to

16 Federal Government procurement opportunities.

17 (3) Easy access for potential Federal Govern18 ment contractors.

19 (4) Use of nationally and internationally recog20 nized data formats that broaden and ease electronic

21 interchange of data.

22 (5) Use of Federal Government systems and net23 works and industry systems and networks.

24 (c) NOTICE AND SOLICITATION REGULATIONS.—In

25 connection with implementation of the architecture or de-
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1 sign referred to in subsection (a), the Federal Acquisition

2 Regulatory Council shall ensure that the Federal Acquisi3 tion Regulation contains appropriate notice and solicita4 tion provisions applicable to acquisitions conducted through

5 such architecture or design. The provisions shall specify the

6 required form and content of notices of acquisitions and the

7 minimum periods for notifications and solicitations. Each

8 minimum period specified for a notification or solicitation

9 shall afford potential offerors a reasonable opportunity to

10 respond to the notification or solicitation, as the case may

11 be.

12 (d) LIMITATION OF PUBLICATION REQUIREMENT.—

13 The requirement in section 18(a) of the Office of Federal

14 Procurement Policy Act (41 U.S.C. 416(a)) and section 8(e)

15 of the Small Business Act (15 U.S.C. 637(e)) for publishing

16 notice of a solicitation in the Commerce Business Daily

17 shall not apply to acquisitions of a Federal agency or a

18 component of a Federal agency that are made through elec19 tronic commerce and have a value not in excess of the sim20 plified acquisition threshold if the Administrator for Fed21 eral Procurement Policy certifies that such agency or com22 ponent—

23 (1) has fully implemented the architecture or de24 sign referred to in subsection (a); and

25 (2) has procedures in place—
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1 (A) to provide notice to potential offerors in

2 accordance with the requirements of the Federal

3 Acquisition Regulation prescribed pursuant to

4 subsection (c); and

5 (B) to ensure that small business concerns

6 are afforded an opportunity to respond to a so7 licitation of contract offers within the period

8 specified in the solicitation.

9 (e) DEFINITION.—In this section, the term ‘‘simplified

10 acquisition threshold’’ has the meaning given that term is

11 section 4(11) of the Office of Federal Procurement Policy

12 Act (41 U.S.C. 403(11)).

13 PART III—APPLICABILITY OF LAWS TO ACQUISI14 TIONS NOT IN EXCESS OF SIMPLIFIED AC15 QUISITION THRESHOLD

16 SEC. 4021. FUTURE ENACTED PROCUREMENT LAWS.

17 The Office of Federal Procurement Policy Act (41

18 U.S.C. 401 et seq.), as amended by section 4011, is further

19 amended by adding at the end the following new section:

20 ‘‘APPLICABILITY OF CERTAIN LAWS TO CONTRACTS NOT

21 EXCEEDING SIMPLIFIED ACQUISITION THRESHOLD

22 ‘‘SEC. 30. (a) IN GENERAL.—The applicability of a

23 provision of law described in subsection (b) to contracts not

24 in excess of the simplified acquisition threshold may be

25 waived on a class basis in the Federal Acquisition Regula26 tion. Such a waiver shall not apply to a provision of law
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1 that expressly refers to this section and prohibits the waiver

2 of that provision of law.

3 ‘‘(b) REFERENCED LAW.—A provision of law referred

4 to in subsection (a) is any provision of law enacted after

5 the date of the enactment of the Federal Acquisition Stream6 lining Act of 1994 that, as determined by the Administrator

7 for Federal Procurement Policy, sets forth policies, proce8 dures, requirements, or restrictions for the procurement of

9 property or services by the Federal Government.’’.

10 SEC. 4022. ARMED SERVICES ACQUISITIONS.

11 (a) REQUIREMENT FOR CONTRACT CLAUSE REGARD12 ING CONTINGENT FEES.—Section 2306(b) of title 10,

13 United States Code, is amended by adding at the end the

14 following: ‘‘This subsection does not apply to a contract that

15 is not in excess of the simplified acquisition threshold.’’.

16 (b) PROHIBITION ON LIMITING SUBCONTRACTOR DI17 RECT SALES TO THE UNITED STATES.—Section 2402 of

18 title 10, United States Code, is amended by adding at the

19 end the following new subsection:

20 ‘‘(c) This section does not apply to a contract that is

21 not in excess of the simplified acquisition threshold (as de22 fined in section 4(11) of the Office of Federal Procurement

23 Policy Act (41 U.S.C. 403(11))).’’.

24 (c) AUTHORITY TO EXAMINE BOOKS AND RECORDS OF

25 CONTRACTORS.—Section 2313 of title 10, United States
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1 Code, as amended by section 2201, is further amended by

2 adding at the end of subsection (f) the following:

3 ‘‘(2) A contract that is not in excess of the sim4 plified acquisition threshold.’’.

5 (d) REQUIREMENT TO IDENTIFY SUPPLIERS AND

6 SOURCES OF SUPPLIES.—Section 2384(b) of title 10,

7 United States Code, is amended by adding at the end the

8 following new paragraph:

9 ‘‘(3) The regulations prescribed pursuant to paragraph

10 (1) do not apply to a contract that does not exceed the sim11 plified acquisition threshold (as defined in section 4(11) of

12 the Office of Federal Procurement Policy Act (41 U.S.C.

13 403(11))).’’.

14 (e) PROHIBITION AGAINST DOING BUSINESS WITH

15 CERTAIN OFFERORS OR CONTRACTORS.—Section 2393(d)

16 of title 10, United States Code, is amended in the second

17 sentence by striking out ‘‘above’’ and all that follows and

18 inserting in lieu thereof ‘‘in excess of the simplified acquisi19 tion threshold (as defined in section 4(11) of the Office of

20 Federal Procurement Policy Act (41 U.S.C. 403(11))).’’.

21 (f) PROHIBITION ON PERSONS CONVICTED OF DE22 FENSE-CONTRACT RELATED FELONIES.—Section 2408(a)

23 of title 10, United States Code, is amended by adding at

24 the end the following new paragraph:
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1 ‘‘(4) The prohibition in paragraph (1) does not apply

2 with respect to the following:

3 ‘‘(A) A contract referred to in subparagraph (A),

4 (B), (C), or (D) of such paragraph that is not in ex5 cess of the simplified acquisition threshold (as defined

6 in section 4(11) of the Office of Federal Procurement

7 Policy Act (41 U.S.C. 403 (11))).

8 ‘‘(B) A subcontract referred to in such subpara9 graph that is under a contract described in subpara10 graph (A).’’.

11 SEC. 4023. CIVILIAN AGENCY ACQUISITIONS.

12 (a) REQUIREMENT FOR CONTRACT CLAUSE REGARD13 ING CONTINGENT FEES.—Section 304(a) of the Federal

14 Property and Administrative Services Act of 1949 (41

15 U.S.C. 254(a)) is amended by adding at the end the follow16 ing: ‘‘The preceding sentence does not apply to a contract

17 that is not in excess of the simplified acquisition thresh18 old.’’.

19 (b) PROHIBITION ON LIMITING SUBCONTRACTOR DI20 RECT SALES TO THE UNITED STATES.—Section 303G of

21 the Federal Property and Administrative Services Act of

22 1949 (41 U.S.C. 253g) is amended by adding at the end

23 the following new subsection:

24 ‘‘(c) This section does not apply to a contract that is

25 not in excess of the simplified acquisition threshold.’’.
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1 (c) AUTHORITY TO EXAMINE BOOKS AND RECORDS OF

2 CONTRACTORS.—Section 304B of the Federal Property and

3 Administrative Services Act of 1949, as added by section

4 2251(a), is amended by adding at the end of subsection (f)

5 the following:

6 ‘‘(2) A contract that is not in excess of the sim7 plified acquisition threshold.’’.

8 SEC. 4024. ACQUISITIONS GENERALLY.

9 (a) LIMITATION ON USE OF FUNDS TO INFLUENCE

10 CERTAIN FEDERAL ACTIONS.—Section 1352(e)(2)(B) of

11 title 31, United States Code, is amended by striking out

12 ‘‘$100,000’’ and inserting in lieu thereof ‘‘the simplified ac13 quisition threshold (as defined in section 4(11) of the Office

14 of Federal Procurement Policy Act (41 U.S.C. 403(11)))’’.

15 (b) REQUIREMENT FOR CONTRACT CLAUSE RELATING

16 TO KICKBACKS.—Section 7 of the Anti-Kickback Act of

17 1986 (41 U.S.C. 57) is amended by adding at the end the

18 following new subsection:

19 ‘‘(d) Subsections (a) and (b) do not apply to a prime

20 contract that is not in excess of the simplified acquisition

21 threshold (as defined in section 4(11) of the Office of Federal

22 Procurement Policy Act (41 U.S.C. 403(11))).’’.

23 (c) MILLER ACT.—

24 (1) IN GENERAL.—
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1 (A) CONTRACTS NOT EXCEEDING SIM2 PLIFIED ACQUISITION THRESHOLD.—The Act of

3 August 24, 1935 (40 U.S.C. 270a et seq.), com4 monly referred to as the ‘‘Miller Act’’, is amend5 ed by adding at the end the following new sec6 tion:

7 ‘‘SEC. 5. This Act does not apply to a contract in an

8 amount that is not in excess of the simplified acquisition

9 threshold (as defined in section 4(11) of the Office of Federal

10 Procurement Policy Act (41 U.S.C. 403(11))).’’.

11 (B) CONFORMING AMENDMENT.—Subsection

12 (a) of the first section of such Act is amended by

13 striking out ‘‘, exceeding $25,000 in amount,’’.

14 (2) ALTERNATIVE PAYMENT PROTECTIONS.—

15 (A) PROTECTIONS TO BE SPECIFIED IN THE

16 FAR.—The Federal Acquisition Regulation shall

17 provide alternatives to payment bonds as pay18 ment protections for suppliers of labor and mate19 rials under contracts referred to in subparagraph

20 (C).

21 (B) USE OF AUTHORIZED PROTECTIONS.—

22 The contracting officer for a contract shall—

23 (i) select, from among the payment

24 protections provided for in the Federal Ac25 quisition Regulation pursuant to subpara-
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1 graph (A), one or more payment protections

2 which the offeror awarded the contract is to

3 submit to the Federal Government for the

4 protection of suppliers of labor and mate5 rials for such contract; and

6 (ii) specify in the solicitation of offers

7 for such contract the payment protection or

8 protections so selected.

9 (C) COVERED CONTRACTS.—

10 (i) APPLICABILITY.—The regulations

11 required under subparagraph (A) and the

12 requirements of subparagraph (B) apply

13 with respect to contracts referred to in sub14 section (a) of the first section of the Miller

15 Act that are in excess of $25,000 but not in

16 excess of the simplified acquisition threshold

17 (as defined in section 4(11) of the Office of

18 Federal Procurement Policy Act (41 U.S.C.

19 403(11))).

20 (ii) MILLER ACT REFERENCE.—The

21 Miller Act referred to in subparagraph (A)

22 is the Act of August 24, 1935 (40 U.S.C.

23 270a et seq.), commonly referred to as the

24 ‘‘Miller Act’’.
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1 (d) CONTRACT WORK HOURS AND SAFETY STANDARDS

2 ACT.—

3 (1) IN GENERAL.—Section 103 of the Contract

4 Work Hours and Safety Standards Act (40 U.S.C.

5 329) is amended by adding at the end the following

6 new subsection:

7 ‘‘(c) This title does not apply to a contract in an

8 amount that is not in excess of the simplified acquisition

9 threshold (as defined in section 4(11) of the Office of Federal

10 Procurement Policy Act (41 U.S.C. 403(11))).’’.

11 (2) CONFORMING AMENDMENT.—Section 107(a)

12 of such Act (40 U.S.C. 333(a)) is amended by insert13 ing after ‘‘It shall be a condition of each contract’’ the

14 following: ‘‘(other than a contract referred to in sec15 tion 103(c))’’.

16 (e) DRUG-FREE WORKPLACE ACT OF 1988.—Section

17 5152(a)(1) of the Drug-Free Workplace Act of 1988 (subtitle

18 D of title V of the Anti-Drug Abuse Act of 1988; Public

19 Law 100–690; 41 U.S.C. 701(a)(1)) is amended by striking

20 out ‘‘of $25,000 or more from any Federal agency’’ and in21 serting in lieu thereof ‘‘in excess of the simplified acquisi22 tion threshold (as defined in section 4(11) of such Act (41

23 U.S.C. 403(11))) by any Federal agency’’.

24 (f) CERTAIN PROCUREMENT INTEGRITY REQUIRE25 MENTS.—
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1 (1) CERTIFICATION REQUIREMENT.—Subsection

2 (e)(7)(A) of section 27 of the Office of Federal Pro3 curement Policy Act (41 U.S.C. 423) is amended by

4 striking out ‘‘$100,000’’ and inserting in lieu thereof

5 ‘‘the simplified acquisition threshold’’.

6 (2) CONTRACT CLAUSE REQUIREMENT.—Sub7 section (g)(1) of such section is amended by inserting

8 after ‘‘awarded by a Federal agency’’ the following:

9 ‘‘(other than a contract in an amount that is not in

10 excess of the simplified acquisition threshold)’’.

11 (g) SOLID WASTE DISPOSAL ACT.—Section 6002(a) of

12 the Solid Waste Disposal Act (42 U.S.C. 6962(a)) is amend13 ed by striking out all that follows ‘‘with respect to any’’

14 and inserting in lieu thereof ‘‘contract in excess of the sim15 plified acquisition threshold (as defined in section 4(11) of

16 the Office of Federal Procurement Policy Act (41 U.S.C.

17 403(11))).’’.

18 PART IV—CONFORMING AMENDMENTS

19 SEC. 4071. ARMED SERVICES ACQUISITIONS.

20 (a) SIMPLIFIED ACQUISITION PROCEDURES.—Section

21 2304(g) of title 10, United States Code, is amended—

22 (1) in paragraph (1), by striking out ‘‘small

23 purchases of property and services’’ and inserting in

24 lieu thereof ‘‘purchases of property and services not in

25 excess of the simplified acquisition threshold’’;
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1 (2) by striking out paragraph (2);

2 (3) by redesignating paragraphs (3) and (4) as

3 paragraphs (2) and (3), respectively;

4 (4) in paragraph (2), as so redesignated—

5 (A) by striking out ‘‘small purchase thresh6 old’’ and inserting in lieu thereof ‘‘simplified ac7 quisition threshold’’; and

8 (B) by striking out ‘‘small purchase proce9 dures’’ and inserting in lieu thereof ‘‘simplified

10 procedures’’; and

11 (5) in paragraph (3), as redesignated by para12 graph (3), by striking out ‘‘small purchase proce13 dures’’ and inserting in lieu thereof ‘‘the simplified

14 procedures’’.

15 (b) SOLICITATION CONTENT REQUIREMENT.—Section

16 2305(a)(2) of title 10, United States Code, is amended by

17 striking out ‘‘small purchases)’’ in the matter above sub18 paragraph (A) and inserting in lieu thereof ‘‘purchases not

19 in excess of the simplified acquisition threshold)’’.

20 (c) COST TYPE CONTRACTS.—Section 2306(e)(2)(A) of

21 title 10, United States Code, is amended by striking out

22 ‘‘small purchase threshold’’ and inserting in lieu thereof

23 ‘‘simplified acquisition threshold’’.

24 SEC. 4072. CIVILIAN AGENCY ACQUISITIONS.

25 (a) SIMPLIFIED ACQUISITION PROCEDURES.—
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1 (1) PROPERTY AND SERVICES GENERALLY.—Sec2 tion 303(g) of the Federal Property and Administra3 tive Services Act of 1949 (41 U.S.C. 253(g)) is

4 amended—

5 (A) in paragraph (1), by striking out

6 ‘‘small purchases of property and services’’ and

7 inserting in lieu thereof ‘‘purchases of property

8 and services not in excess of the simplified acqui9 sition threshold’’;

10 (B) by striking out paragraphs (2) and (5);

11 (C) by redesignating paragraphs (3) and

12 (4) as paragraphs (2) and (3), respectively;

13 (D) in paragraph (2), as so redesignated—

14 (i) by striking out ‘‘small purchase

15 threshold’’ and inserting in lieu thereof

16 ‘‘simplified acquisition threshold’’; and

17 (ii) by striking out ‘‘small purchase

18 procedures’’ and inserting in lieu thereof

19 ‘‘simplified procedures’’; and

20 (E) in paragraph (3), as redesignated by

21 subparagraph (C), by striking out ‘‘small pur22 chase procedures’’ and inserting in lieu thereof

23 ‘‘the simplified procedures’’.

24 (2) LEASEHOLDS.—Section 210 of the Federal

25 Property and Administrative Services Act of 1949 (40
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1 U.S.C. 490) is amended by adding at the end the fol2 lowing new subsection:

3 ‘‘(k)(1) Regulations prescribed by the Administrator

4 shall provide special simplified procedures for acquisitions

5 of leasehold interests in real property at rental rates that

6 do not exceed the simplified acquisition threshold.

7 ‘‘(2) For purposes of paragraph (1), the rental rate

8 or rates under a multiyear lease do not exceed the simplified

9 acquisition threshold if the average annual amount of the

10 rent payable for the period of the lease does not exceed the

11 simplified acquisition threshold.

12 ‘‘(3) In this subsection, the term ‘simplified acquisition

13 threshold’ has the meaning given that term in section 4(11)

14 of the Office of Federal Procurement Policy Act (41 U.S.C.

15 403(11)).’’.

16 (b) SOLICITATION CONTENT REQUIREMENT.—Section

17 303A(b) of the Federal Property and Administrative Serv18 ices Act of 1949 (41 U.S.C. 253a(b)) is amended by striking

19 out ‘‘small purchases)’’ in the matter above paragraph (1)

20 and inserting in lieu thereof ‘‘purchases not in excess of

21 the simplified acquisition threshold)’’.

22 (c) COST TYPE CONTRACTS.—Section 304(b) of the

23 Federal Property and Administrative Services Act of 1949

24 (41 U.S.C. 254(b)), as amended by section 1071, is further

25 amended in the second sentence by striking out ‘‘either
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1 $25,000’’ and inserting in lieu thereof ‘‘either the simplified

2 acquisition threshold’’.

3 SEC. 4073. OFFICE OF FEDERAL PROCUREMENT POLICY

4 ACT.

5 Section 19(a) of the Office of Federal Procurement Pol6 icy Act (41 U.S.C. 417(a)) is amended by striking out ‘‘pro7 curements, other than small purchases,’’ and inserting in

8 lieu thereof ‘‘procurements in excess of the simplified acqui9 sition threshold’’.

10 SEC. 4074. SMALL BUSINESS ACT.

11 (a) DEFINITION.—Section 3(m) of the Small Business

12 Act (15 U.S.C. 632(m)) is amended by striking out ‘‘ ‘small

13 purchase threshold’ ’’ and inserting in lieu thereof ‘‘ ‘sim14 plified acquisition threshold’ ’’.

15 (b) USE OF SIMPLIFIED ACQUISITION THRESHOLD

16 TERM.—Section 8(d)(2)(A) of the Small Business Act (15

17 U.S.C. 637(d)(2)(A)) is amended by striking out ‘‘small

18 purchase threshold’’ and inserting in lieu thereof ‘‘sim19 plified acquisition threshold’’.

20 PART V—REVISION OF REGULATIONS

21 SEC. 4081. REVISION REQUIRED.

22 (a) FEDERAL ACQUISITION REGULATION.—The Fed23 eral Acquisition Regulatory Council established by section

24 25(a) of the Office of Federal Procurement Policy Act (41

25 U.S.C. 421(a)) shall review the Federal Acquisition Regula-
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1 tion to identify regulations that are applicable to acquisi2 tions in excess of a specified amount that is less than

3 $100,000. The Council shall amend the regulations so iden4 tified as necessary to provide that such regulations do not

5 apply to acquisitions that are not in excess of the simplified

6 acquisition threshold. The preceding sentence does not apply

7 in the case of a regulation for which such an amendment

8 would not be in the national interest, as determined by the

9 Council.

10 (b) SUPPLEMENTAL REGULATIONS.—The head of each

11 Federal agency that has issued regulations, policies, or pro12 cedures referred to in section 25(c)(2) of the Office of Fed13 eral Procurement Policy Act (41 U.S.C. 421(c)(2)) shall

14 identify any such regulations, policies, or procedures that

15 are applicable to acquisitions in excess of a specified

16 amount that is less than $100,000. The agency head shall

17 amend the regulations so identified as necessary to provide

18 that such regulations, policies, and procedures do not apply

19 to acquisitions that are not in excess of the simplified acqui20 sition threshold. The preceding sentence does not apply in

21 the case of a regulation, policy, or procedure for which such

22 an amendment would not be in the national interest, as

23 determined by the agency head.
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1 (c) COMPLETION OF ACTIONS.—All actions under this

2 section shall be completed not later than 180 days after the

3 date of the enactment of this Act.

4 (d) DEFINITIONS.—In this section:

5 (1) The term ‘‘simplified acquisition threshold’’

6 has the meaning given such term in section 4(11) of

7 the Office of Federal Procurement Policy Act (41

8 U.S.C. 403(11)), as amended by section 4001.

9 (2) The term ‘‘Federal agency’’ has the meaning

10 given such term in section 3(b) of the Federal Prop11 erty and Administrative Services Act of 1949 (41

12 U.S.C. 472(b)).

13 Subtitle B—Socioeconomic and

14 Small Business Laws

15 SEC. 4101. ARMED SERVICES ACQUISITIONS.

16 (a) INAPPLICABILITY OF CERTAIN LABOR LAWS TO

17 CONSTRUCTION OF NAVAL VESSELS.—Section 7299 of title

18 10, United States Code, is amended to read as follows: ‘‘No

19 contract for the construction, alteration, furnishing, or

20 equipping of a naval vessel shall be subject to the Act of

21 March 3, 1931 (40 U.S.C. 276a(a)), commonly referred to

22 as the ‘Davis-Bacon Act’, or to the Service Contract Act

23 of 1965 (41 U.S.C. 351 et seq.), unless the President deter24 mines that such requirement is in the interest of national

25 defense.’’.
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1 (b) CLERICAL AMENDMENTS.—

2 (1) SECTION HEADING.—The heading of such sec3 tion is amended to read as follows:

4 ‘‘§ 7299. Contracts: applicability of certain labor

5 laws’’.

6 (2) TABLE OF SECTIONS.—The item relating to

7 such section in the table of sections at the beginning

8 of chapter 633 of title 10, United States Code, is

9 amended to read as follows:

‘‘7299. Contracts: applicability of certain labor laws.’’.

10 SEC. 4102. ACQUISITIONS GENERALLY.

11 (a) INAPPLICABILITY OF CERTAIN LABOR LAWS TO

12 CONSTRUCTION OF VESSELS.—No contract for the construc13 tion, alteration, furnishing, or equipping of a vessel shall

14 be subject to the Act of March 3, 1931 (40 U.S.C. 276a(a)),

15 commonly referred to as the ‘Davis-Bacon Act’, or to the

16 Service Contract Act of 1965 (41 U.S.C. 351 et seq.), unless

17 the President determines that such requirement is in the

18 interest of the United States.

19 (b) REPEAL OF EXECUTED REPORTING REQUIRE20 MENT.—Section 306 of the Trade Agreements Act of 1979

21 (19 U.S.C. 2516) is repealed.

22 (c) WALSH-HEALEY ACT.—

23 (1) REPEAL OTHER THAN FOR CERTAIN DEFINI24 TIONAL PURPOSES.—The Act of June 30, 1936 (41
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1 U.S.C. 35 et seq.), commonly referred to as the

2 ‘‘Walsh-Healey Act’’, is amended to read as follows:

3 ‘‘SECTION 1. (a) The Secretary of Labor may prescribe

4 in regulations the standards for determining whether a con5 tractor is a manufacturer of or a regular dealer in mate6 rials, supplies, articles, or equipment to be manufactured

7 or used in the performance of a contract entered into by

8 any executive department, independent establishment, or

9 other agency or instrumentality of the United States, or by

10 the District of Columbia, or by any corporation all the stock

11 of which is beneficially owned by the United States, for the

12 manufacture or furnishing of materials, supplies, articles,

13 and equipment.

14 ‘‘(b) Any interested person shall have the right of judi15 cial review of any legal question regarding the interpreta16 tion of the terms ‘regular dealer’ and ‘manufacturer’, as de17 fined pursuant to subsection (a).’’

18 (2) CONFORMING AMENDMENT.—Section 2304(h)

19 of title 10, United States Code, is amended to read as

20 follows:

21 ‘‘(h) For the purposes of the Act entitled ‘An Act relat22 ing to the rate of wages for laborers and mechanics em23 ployed on public buildings of the United States and the Dis24 trict of Columbia by contractors and subcontractors, and

25 for other purposes’, approved March 3, 1931 (commonly re-
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1 ferred to as the ‘Davis-Bacon Act’) (40 U.S.C. 276a et seq.),

2 purchases or contracts awarded after using procedures other

3 than sealed-bid procedures shall be treated as if they were

4 made with sealed-bid procedures.’’.

5 (d) REPEAL OF REDUNDANT REQUIREMENT REGARD6 ING APPLICABILITY OF THE DAVIS-BACON ACT AND THE

7 WALSH-HEALEY ACT.—Section 308 of the Federal Property

8 and Administrative Services Act of 1949 (41 U.S.C. 258)

9 is repealed.

10 SEC. 4103. ACQUISITIONS FROM SMALL BUSINESSES.

11 (a) SET-ASIDE PRIORITY.—Section 15 of the Small

12 Business Act (15 U.S.C. 644) is amended by striking out

13 subsections (e) and (f).

14 (b) CERTIFICATE OF COMPETENCE.—Section 804 of

15 Public Law 103–484 (106 Stat. 2447; 10 U.S.C. 2305 note)

16 is repealed.

17 SEC. 4104. CONTRACTING PROGRAM FOR CERTAIN SMALL

18 BUSINESS CONCERNS.

19 (a) PROCUREMENT PROCEDURES AUTHORIZED.—Sec20 tion 8 of the Small Business Act (15 U.S.C. 637) is amend21 ed by inserting after subsection (b) the following new sub22 section:

23 ‘‘(c)(1) To facilitate the attainment of a goal for the

24 participation of small business concerns owned and con25 trolled by socially and economically disadvantaged individ-
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1 uals that is established for a Federal agency pursuant to

2 section 15(g)(1), the head of the agency may enter into con3 tracts using—

4 ‘‘(A) less than full and open competition by re5 stricting the competition for such awards to small

6 business concerns owned and controlled by socially

7 and economically disadvantaged individuals described

8 in subsection (d)(3)(C) of this section; and

9 ‘‘(B) a price evaluation preference not in excess

10 of 10 percent when evaluating an offer received from

11 such a small business concern as the result of an un12 restricted solicitation.

13 ‘‘(2) Paragraph (1) does not apply to the Department

14 of Defense.’’.

15 (b) IMPLEMENTATION THROUGH THE FEDERAL AC16 QUISITION REGULATION.—

17 (1) IN GENERAL.—The Federal Acquisition Reg18 ulation shall be amended to provide for uniform im19 plementation of the authority provided in section 8(c)

20 of the Small Business Act, as added by subsection (a).

21 (2) MATTERS TO BE ADDRESSED.—The provi22 sions of the Federal Acquisition Regulation prescribed

23 pursuant to paragraph (1) shall include—

24 (A) conditions for the use of advance pay25 ments;
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1 (B) provisions for contract payment terms

2 that provide for—

3 (i) accelerated payment for work per4 formed during the period for contract per5 formance; and

6 (ii) full payment for work performed;

7 (C) guidance on how contracting officers

8 may use, in solicitations for various classes of

9 products or services, a price evaluation pref10 erence pursuant to section 8(c)(1)(B) of the

11 Small Business Act, as added by subsection (a),

12 to provide a reasonable advantage to small busi13 ness concerns owned and controlled by socially

14 and economically disadvantaged individuals

15 without effectively eliminating any participation

16 of other small business concerns; and

17 (D)(i) procedures for a person to request the

18 head of Federal agency to determine whether the

19 use of competitions restricted to small business

20 concerns owned and controlled by socially and

21 economically disadvantaged individuals at a

22 contracting activity of such agency has caused a

23 particular industry category to bear a dispropor24 tionate share of the contracts awarded to attain
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1 the goal established for that contracting activity;

2 and

3 (ii) guidance for limiting the use of such re4 stricted competitions in the case of any contract5 ing activity and class of contracts determined in

6 accordance with such procedures to have caused

7 a particular industry category to bear a dis8 proportionate share of the contracts awarded to

9 attain the goal established for that contracting

10 activity.

11 (c) TERMINATION.—Section 8(c) of the Small Business

12 Act, as added by subsection (a), shall cease to be effective

13 at the end of September 30, 1999.

14 Subtitle C—Miscellaneous

15 Acquisition Laws

16 SEC. 4151. PROHIBITION ON USE OF FUNDS FOR DOCU17 MENTING ECONOMIC OR EMPLOYMENT IM18 PACT OF CERTAIN ACQUISITION PROGRAMS.

19 (a) REVISION AND CODIFICATION.—

20 (1) IN GENERAL.—Subchapter I of chapter 134

21 of title 10, United States Code, is amended by adding

22 at the end the following new section:
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1 ‘‘§ 2247. Prohibition on use of funds for documenting

2 economic or employment impact of certain

3 acquisition programs

4 ‘‘No funds appropriated by the Congress may be obli5 gated or expended to assist any contractor of the Depart6 ment of Defense in preparing any material, report, lists,

7 or analysis with respect to the actual or projected economic

8 or employment impact in a particular State or congres9 sional district of an acquisition program for which all re10 search, development, testing, and evaluation has not been

11 completed.’’.

12 (2) CLERICAL AMENDMENT.—The table of sec13 tions at the beginning of such subchapter is amended

14 by adding at the end the following new item:

‘‘2247. Prohibition on use of funds for documenting economic or employment impact of certain acquisition programs.’’.

15 (b) REPEAL OF SUPERSEDED LAW.—Section 9048 of

16 Public Law 102–396 (106 Stat. 1913) is repealed.

17 SEC. 4152. RESTRICTION ON USE OF NONCOMPETITIVE

18 PROCEDURES FOR PROCUREMENT FROM A

19 PARTICULAR SOURCE.

20 (a) ARMED SERVICES ACQUISITIONS.—Section 2304 of

21 title 10, United States Code, as amended by section 1005(b),

22 is further amended—

23 (1) in subsection (c)(5), by inserting ‘‘subject to

24 subsection (j),’’ after ‘‘(5)’’; and
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1 (2) by adding at the end the following new sub2 section:

3 ‘‘(j)(1) It is the policy of Congress that no legislation

4 should be enacted that requires a procurement to be made

5 from a specified non-Federal Government source.

6 ‘‘(2) A provision of law may not be construed as re7 quiring a procurement to be made from a specified non8 Federal Government source unless that provision of law—

9 ‘‘(A) specifically refers to this subsection;

10 ‘‘(B) specifically identifies the particular non11 Federal Government source involved; and

12 ‘‘(C) specifically states that the procurement

13 from that source is required by such provision of law

14 in contravention of the policy set forth in paragraph

15 (1).’’.

16 (b) CIVILIAN AGENCY ACQUISITIONS.—Section 303 of

17 the Federal Property and Administrative Services Act of

18 1949 (41 U.S.C. 253) is amended—

19 (1) in subsection (c)(5), by inserting ‘‘subject to

20 subsection (h),’’ after ‘‘(5)’’; and

21 (2) by adding at the end the following new sub22 section:

23 ‘‘(h)(1) It is the policy of Congress that no legislation

24 should be enacted that requires a procurement to be made

25 from a specified non-Federal Government source.
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1 ‘‘(2) A provision of law may not be construed as re2 quiring a procurement to be made from a specified non3 Federal Government source unless that provision of law—

4 ‘‘(A) specifically refers to this subsection;

5 ‘‘(B) specifically identifies the particular non6 Federal Government source involved; and

7 ‘‘(C) specifically states that the procurement

8 from that source is required by such provision of law

9 in contravention of the policy set forth in paragraph

10 (1).’’.

11 TITLE V—ACQUISITION

12 MANAGEMENT

13 Subtitle A—Armed Services

14 Acquisitions

15 SEC. 5001. PERFORMANCE BASED MANAGEMENT.

16 (a) POLICY AND GOALS FOR PERFORMANCE BASED

17 MANAGEMENT OF PROGRAMS.—

18 (1) IN GENERAL.—Chapter 131 of title 10, Unit19 ed States Code, is amended by adding at the end the

20 following new section:

21 ‘‘§ 2219. Performance based management: acquisition

22 programs

23 ‘‘(a) CONGRESSIONAL POLICY.—It is the policy of Con24 gress that—
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1 ‘‘(1) the Department of Defense should achieve,

2 on average, 90 percent of the cost and schedule goals

3 established for the research and development programs

4 and acquisition programs of the Department of De5 fense without reducing the performance or capabilities

6 of the items being acquired; and

7 ‘‘(2) the average period necessary for converting

8 an emerging technology into initial operational capa9 bility for the Department of Defense should not exceed

10 8 years.

11 ‘‘(b) ESTABLISHMENT OF GOALS.—(1) The Secretary

12 of Defense shall approve or define the cost, performance, and

13 schedule goals for major defense acquisition programs of the

14 Department of Defense.

15 ‘‘(2) The Comptroller of the Department of Defense

16 shall evaluate the cost goals proposed for each major defense

17 acquisition program of the Department.

18 ‘‘(c) IDENTIFICATION OF NONCOMPLIANT PRO19 GRAMS.—Whenever it is necessary to do so in order to im20 plement the policy set out in subsection (a), the Secretary

21 of Defense shall—

22 ‘‘(1) identify and consider whether there is a

23 continuing need for programs that are significantly

24 behind schedule, over budget, or not in compliance
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1 with performance or capability requirements taking

2 into consideration—

3 ‘‘(A) the needs of the Department known as

4 of the time of consideration;

5 ‘‘(B) the state of the technology or tech6 nologies relevant to the programs and to the

7 needs of the Department;

8 ‘‘(C) the estimated costs and projected

9 schedules necessary for the completion of such

10 programs; and

11 ‘‘(D) other pertinent information; and

12 ‘‘(2) identify existing and potential research and

13 development programs and acquisition programs that

14 are suitable alternatives for programs considered pur15 suant to paragraph (1).

16 ‘‘(d) ANNUAL REPORTING REQUIREMENT.—The Sec17 retary of Defense shall include in the annual report submit18 ted to Congress pursuant to section 113(c) of this title an

19 assessment of the progress made in implementing the policy

20 stated in subsection (a). The Secretary shall use data from

21 existing management systems in making the assessment.’’.

22 (2) CLERICAL AMENDMENT.—The table of sec23 tions at the beginning of such chapter is amended by

24 adding at the end the following new item:

‘‘2219. Performance based management: acquisition programs.’’.
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1 (b) ENHANCED SYSTEM OF PERFORMANCE INCEN2 TIVES.—Within one year after the date of the enactment

3 of this Act, the Secretary of Defense shall review the incen4 tives and personnel actions available to the Secretary for

5 encouraging excellence in the defense acquisition workforce

6 and provide an enhanced system of incentives for the en7 couragement of excellence in such workforce. The enhanced

8 system of incentives shall, to the maximum extent consistent

9 with applicable law—

10 (1) relate pay to performance (including the ex11 tent to which the performance of personnel in such

12 workforce contributes to achieving the cost goals,

13 schedule goals, and performance goals established for

14 acquisition programs of the department pursuant to

15 section 2219(b) of title 10, as added by subsection

16 (a)); and

17 (2) provide for consideration, in personnel eval18 uations and promotion decisions, of the extent to

19 which the performance of personnel in such workforce

20 contributes to achieving the cost goals, schedule goals,

21 and performance goals established for acquisition pro22 grams of the department pursuant to section 2219(b)

23 of title 10, United States Code, as added by subsection

24 (a).
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1 (c) RECOMMENDED LEGISLATION.—Not later than one

2 year after the date of the enactment of this Act, the Sec3 retary of Defense shall submit to Congress any rec4 ommended legislation that the Secretary considers necessary

5 to carry out section 2219 of title 10, United States Code,

6 as added by subsection (a), and otherwise to facilitate and

7 enhance management of Department of Defense acquisition

8 programs and the defense acquisition workforce on the basis

9 of performance.

10 SEC. 5002. RESULTS ORIENTED ACQUISITION PROGRAM

11 CYCLE.

12 The Secretary of Defense shall define in regulations a

13 simplified acquisition program cycle that is results-ori14 ented. The Secretary shall consider including in the regula15 tions provisions for the following:

16 (1) Program phases as follows:

17 (A) An integrated decision team meeting

18 which—

19 (i) may be requested by a potential

20 user of the system or component to be ac21 quired, the head of a laboratory, or a pro22 gram office on such bases as the emergence

23 of a new military requirement, cost savings

24 opportunity, or new technology opportunity;
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1 (ii) is conducted by an acquisition pro2 gram executive officer; and

3 (iii) is usually completed within 1 to

4 3 months.

5 (B) A prototype development and testing

6 phase which—

7 (i) includes operational tests and con8 cerns relating to manufacturing operations

9 and life cycle support;

10 (ii) is usually completed within 6 to

11 36 months; and

12 (iii) produces sufficient numbers of

13 prototypes to assess operational utility.

14 (C) Product integration, development, and

15 testing which—

16 (i) includes full-scale development,

17 operational testing, and integration of com18 ponents; and

19 (ii) is usually completed within 1 to 5

20 years.

21 (D) Production, integration into existing

22 systems, or production and integration into ex23 isting systems.
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1 (2) An acquisition program approval process for

2 major program decisions which consists of the follow3 ing:

4 (A) One major decision point—

5 (i) which occurs for an acquisition

6 program before the program proceeds into

7 product integration and development; and

8 (ii) at which the Under Secretary of

9 Defense for Acquisition and Technology, in

10 consultation with the Vice Chairman of the

11 Joint Chiefs of Staff reviews the program,

12 determines whether the program should con13 tinue to be carried out beyond product inte14 gration and development, and decides

15 whether to commit to further development,

16 to require further prototyping, or to termi17 nate the program.

18 (B) Consideration of the potential benefits,

19 affordability, needs, and risks of an acquisition

20 program in the review of the acquisition pro21 gram.

22 SEC. 5003. DEFENSE ACQUISITION PILOT PROGRAM DES23 IGNATIONS.

24 (a) PROGRAMS AND WAIVERS.—The National Defense

25 Authorization Act for Fiscal Year 1994 (Public Law 103–
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1 160) is amended by inserting the following new section at

2 the end of subtitle D of title VIII:

3 ‘‘SEC. 840. DEFENSE ACQUISITION PILOT PROGRAM DES4 IGNATIONS.

5 ‘‘(a) ELIGIBLE PROGRAMS.—The Secretary of Defense

6 is authorized to designate the following defense acquisition

7 programs for participation in the defense acquisition pilot

8 program authorized by section 809 of the National Defense

9 Authorization Act for Fiscal Year 1991 (10 U.S.C. 2430

10 note):

11 ‘‘(1) Defense Personnel Support Center medical,

12 clothing and textile, and subsistence programs with

13 respect to the following:

14 ‘‘(A) All contracts for processed fruits and

15 vegetables and frozen seafood items for both depot

16 stock and direct vendor delivery.

17 ‘‘(B) All contracts in the subsistence prime

18 vendor program for grocery items.

19 ‘‘(C) All contracts in the Mail Order Phar20 macy Program, the prime vendor programs for

21 pharmaceuticals and for medical surgical items

22 for delivery to military hospitals.

23 ‘‘(D) All contracts in the medical electronic

24 commerce program for acquisition for depot stock

25 and direct vendor delivery.
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1 ‘‘(E) All contracts for the following items:

2 dress coats (small lots), dress coats, duffel bags,

3 Navy work clothing, general purpose tents, suit4 cases, gloves for electrical workers, boot flyers,

5 socks, drawers, undershirts, and items offered

6 under the Broad Agency Announcements for

7 Clothing and Textiles Advanced Business Prac8 tices Demonstration Program.

9 ‘‘(2) The Fire Support Combined Arms Tactical

10 Trainer program with respect to all contracts directly

11 related to the procurement of a training system (in12 cluding related hardware, software, and subsystems)

13 to perform collective training of field artillery gun14 nery team components with development of software

15 as required to generate the training exercises and

16 component interfaces.

17 ‘‘(3) The Joint Direct Attack Munition program

18 (JDAM I) with respect to all contracts directly relat19 ed to the development and procurement of a strap-on

20 guidance kit, using an inertially guided, Global Posi21 tioning System updated guidance kit for inventory

22 1,000 and 2,000 pound bombs.

23 ‘‘(4) The Joint Primary Aircraft Training Sys24 tem (JPATS) with respect to all contracts directly re25 lated to the acquisition of a new primary trainer air-
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1 craft to fulfill Air Force and Navy joint undergradu2 ate aviation training requirements, and an associated

3 ground-based training system consisting of air crew

4 training devices (simulators), courseware, a Training

5 Management System, and contractor support for the

6 life of the system.

7 ‘‘(5) The Commercial Derivatives Aircraft pro8 gram with respect to all contracts directly related to

9 the acquisition or upgrading of civil-derivative air10 craft for use in (A) foreign military sales of Airborne

11 Warning and Control Systems to foreign governments

12 with modifications of a type customarily provided to

13 commercial customers, or (B) future Air Force airlift

14 and tanker requirements.

15 ‘‘(6) The Commercial Derivative Engine pro16 gram with respect to all contracts directly related to

17 the acquisition of (A) commercially derived engines

18 (including spare engines), logistics support equip19 ment, technical orders, management data, and initial

20 spare parts for use in the C–17A production line, and

21 (B) commercially derived engines to support the pur22 chase of commercial-derivative aircraft to meet future

23 Air Force airlift and tanker requirements, including

24 engine replacement and upgrades.
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1 ‘‘(b) WAIVER AUTHORITY.—Subject to section 809(c)

2 of the National Defense Authorization Act for Fiscal Year

3 1991, the Secretary of Defense is authorized—

4 ‘‘(1) to apply any amendment or repeal of a pro5 vision of law made in the Federal Acquisition

6 Streamlining Act of 1994 to the programs described

7 in subsection (a) before the effective date of such

8 amendment or repeal; and

9 ‘‘(2) to apply to a procurement of noncommer10 cial items under such programs—

11 ‘‘(A) any authority provided in such Act (or

12 in an amendment made by a provision of such

13 Act) to waive a provision of law in the case of

14 commercial items, and

15 ‘‘(B) any exception applicable under such

16 Act (or an amendment made by a provision of

17 such Act) in the case of commercial items,

18 before the effective date of such provision (or amend19 ment) to the extent that the Secretary determines nec20 essary to test the application of such waiver or excep21 tion to procurements of noncommercial items.

22 ‘‘(c) PILOT PROGRAM IMPLEMENTATION.—In exercis23 ing the authority provided in section 809 of the National

24 Defense Authorization Act for 1991, and in accordance with
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1 sections 833 through 839 of this Act, the Secretary of De2 fense, shall take the following actions:

3 ‘‘(1) MISSION-ORIENTED PROGRAM MANAGE4 MENT.—For one or more of the defense acquisition

5 programs designated for participation in the defense

6 acquisition pilot program, prescribe and implement

7 procedures which—

8 ‘‘(A) provide for interaction between the

9 program manager and the commander of the

10 operational command responsible for the require11 ment for the equipment acquired;

12 ‘‘(B) include provisions for a determination

13 by the commander that items proposed for pro14 curement fulfill the need defined in approved re15 quirements documents; and

16 ‘‘(C) may include a role for the operational

17 commander in decision making for program

18 milestone decisions and performance of accept19 ance testing of items acquired.

20 ‘‘(2) SAVINGS OBJECTIVES.—Not later than 45

21 days after the date of enactment of the Federal Acqui22 sition Streamlining Act of 1994, identify for each de23 fense acquisition program participating in the pilot

24 program quantitative measures and goals for reduc25 ing acquisition management costs.
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1 ‘‘(3) PROGRAM PHASES.—For each defense ac2 quisition program participating in the pilot program,

3 incorporate in an approved acquisition strategy a

4 program review process that provides senior acquisi5 tion officials with reports that—

6 ‘‘(A) contain essential information on pro7 gram results at quarterly intervals;

8 ‘‘(B) reduce data requirements from the cur9 rent major program review reporting require10 ments; and

11 ‘‘(C) include data on program costs esti12 mates, actual expenditures, performance esti13 mates, performance data from tests, and, consist14 ent with existing statutes, the minimum nec15 essary other data items required to ensure the

16 appropriate expenditure of funds appropriated

17 for that program.

18 ‘‘(4) PROGRAM WORK FORCE POLICIES.—With

19 regard to the review of incentives and personnel ac20 tions required under section 836 of this Act—

21 ‘‘(A) not later than 60 days after the date

22 of the enactment of the Federal Acquisition

23 Streamlining Act of 1994—

24 ‘‘(i) complete the review; and
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1 ‘‘(ii) on the basis of the review, define

2 one or more systems that relate incentives,

3 including pay, to achievement of budgets,

4 schedules, and performance requirements;

5 ‘‘(B) not later than 120 days after the date

6 of the enactment of the Federal Acquisition

7 Streamlining Act of 1994—

8 ‘‘(i) apply such a system of incentives

9 to not less than one defense acquisition pro10 gram participating in the pilot program;

11 and

12 ‘‘(ii) provide for an assessment of the

13 effectiveness of that system; and

14 ‘‘(C) incorporate the results of actions taken

15 pursuant to this paragraph into the development

16 of regulations for the implementation of section

17 5001(b) of the Federal Acquisition Streamlining

18 Act of 1994.

19 ‘‘(5) EFFICIENT CONTRACTING PROCESS.—Take

20 any additional actions that the Secretary considers

21 necessary to waive regulations, not required by stat22 ute, that affect the efficiency of the contracting proc23 ess, including, in the Secretary’s discretion, defining

24 alternative techniques to reduce reliance on military

25 specifications and standards in contracts for the de-
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1 fense acquisition programs participating in the pilot

2 program.

3 ‘‘(6) CONTRACT ADMINISTRATION: PERFORMANCE

4 BASED CONTRACT MANAGEMENT.—For at least one

5 participating defense acquisition program for which a

6 determination is made to make payments for work in

7 progress under the authority of section 2307 of title

8 10, United States Code, define payment milestones on

9 the basis of quantitative measures of results.

10 ‘‘(7) CONTRACTOR PERFORMANCE ASSESS11 MENT.—Collect and evaluate performance information

12 on each contract entered into for a defense acquisition

13 program participating in the pilot program, includ14 ing information on cost, schedule, and technical per15 formance for each contractor supporting a participat16 ing program.

17 ‘‘(d) APPLICABILITY.—(1) Subsection (b) applies with

18 respect to—

19 ‘‘(A) a contract that is awarded or modified dur20 ing the period described in paragraph (2); and

21 ‘‘(B) a contract that is awarded before the begin22 ning of such period and is to be performed (or may

23 be performed), in whole or in part, during such pe24 riod.
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1 ‘‘(2) The period referred to in paragraph (1) is the

2 period that begins 45 days after the date of the enactment

3 of the Federal Acquisition Streamlining Act of 1994 and

4 ends on September 30, 1998.’’.

5 (b) RULE OF CONSTRUCTION.—Nothing in section 840

6 of the National Defense Authorization Act for Fiscal Year

7 1994, as added by subsection (a), shall be construed as au8 thorizing the appropriation or obligation of funds for the

9 programs designated for participation in the defense acqui10 sition pilot program under the authority of subsection (a)

11 of such section 840.

12 Subtitle B—Civilian Agency

13 Acquisitions

14 SEC. 5051. PERFORMANCE BASED MANAGEMENT.

15 (a) POLICY AND GOALS FOR PERFORMANCE BASED

16 MANAGEMENT OF PROGRAMS.—

17 (1) IN GENERAL.—Title III of the Federal Prop18 erty and Administrative Services Act of 1949 (41

19 U.S.C. 301 et seq.), as amended by sections 1552 and

20 1553, is further amended by adding at the end the fol21 lowing new section:

22 ‘‘PERFORMANCE BASED MANAGEMENT: ACQUISITION

23 PROGRAMS

24 ‘‘SEC. 311. (a) CONGRESSIONAL POLICY.—It is the

25 policy of Congress that the head of each executive agency

26 should achieve, on average, 90 percent of the cost and sched-
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1 ule goals established for the research and development pro2 grams and acquisition programs of the agency without re3 ducing the performance or capabilities of the items being

4 acquired.

5 ‘‘(b) ESTABLISHMENT OF GOALS.—(1) The head of

6 each executive agency shall approve or define the cost, per7 formance, and schedule goals for major acquisition pro8 grams of the agency.

9 ‘‘(2) The chief financial officer of an executive agency

10 shall evaluate the cost goals proposed for each major defense

11 acquisition program of the agency.

12 ‘‘(c) IDENTIFICATION OF NONCOMPLIANT PRO13 GRAMS.—Whenever it is necessary to do so in order to im14 plement the policy set out in subsection (a), the head of

15 an executive agency shall—

16 ‘‘(1) identify and consider whether there is a

17 continuing need for programs that are significantly

18 behind schedule, over budget, or not in compliance

19 with performance or capability requirements taking

20 into consideration—

21 ‘‘(A) the needs of the agency known as of the

22 time of consideration;

23 ‘‘(B) the state of the technology or tech24 nologies relevant to the programs and to the

25 needs of the agency;
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1 ‘‘(C) the estimated costs and projected

2 schedules necessary for the completion of such

3 programs; and

4 ‘‘(D) other pertinent information; and

5 ‘‘(2) identify existing and potential research and

6 development programs and acquisition programs that

7 are suitable alternatives for programs considered pur8 suant to paragraph (1).’’.

9 (2) CLERICAL AMENDMENT.—The table of con10 tents in the first section of such Act, as amended by

11 sections 1552 and 1553, is further amended by insert12 ing after the item relating to section 310 the following

13 new item:

‘‘Sec. 311. Performance based management: acquisition programs.’’.

14 (b) ANNUAL REPORTING REQUIREMENT.—Section 6 of

15 the Office of Federal Procurement Policy Act (41 U.S.C.

16 405), as amended by section 1091, is further amended by

17 adding at the end the following new subsection:

18 ‘‘(k) The Administrator shall submit to Congress, on

19 an annual basis, an assessment of the progress made in ex20 ecutive agencies in implementing the policy stated in sec21 tion 311(a) of the Federal Property and Administrative

22 Services Act of 1949. The Administrator shall use data from

23 existing management systems in making the assessment.’’.

24 (c) ENHANCED SYSTEM OF PERFORMANCE INCEN25 TIVES.—Within one year after the date of the enactment
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1 of this Act, the Administrator for Federal Procurement Pol2 icy, in consultation with appropriate officials in other de3 partments and agencies of the Federal Government, shall,

4 to the maximum extent consistent with applicable law—

5 (1) establish policies and procedures for the

6 heads of such departments and agencies to designate

7 acquisition positions and manage employees (includ8 ing the accession, education, training and career de9 velopment of employees) in the designated acquisition

10 positions;

11 (2) extend to the acquisition workforce of the en12 tire executive branch the acquisition workforce poli13 cies contained in chapter 87 of title 10, United States

14 Code, relating to the acquisition workforce of the De15 partment of Defense; and

16 (3) review the incentives and personnel actions

17 available to the heads of department and agencies of

18 the Federal Government for encouraging excellence in

19 the acquisition workforce of the Federal Government

20 and provide an enhanced system of incentives for the

21 encouragement of excellence in such workforce

22 which—

23 (A) relates pay to performance (including

24 the extent to which the performance of personnel

25 in such workforce contributes to achieving the
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1 cost goals, schedule goals, and performance goals

2 established for acquisition programs pursuant to

3 section 311(b) of the Federal Property and Ad4 ministrative Services Act of 1949, as added by

5 subsection (a)); and

6 (B) provides for consideration, in personnel

7 evaluations and promotion decisions, of the ex8 tent to which the performance of personnel in

9 such workforce contributes to achieving such cost

10 goals, schedule goals, and performance goals.

11 (d) RECOMMENDED LEGISLATION.—Not later than one

12 year after the date of the enactment of this Act, the Admin13 istrator for Federal Procurement Policy shall submit to

14 Congress any recommended legislation that the Secretary

15 considers necessary to carry out section 311 of the Federal

16 Property and Administrative Services Act of 1949, as added

17 by subsection (a), and otherwise to facilitate and enhance

18 management of Federal Government acquisition programs

19 and the acquisition workforce of the Federal Government

20 on the basis of performance.

21 SEC. 5052. RESULTS-ORIENTED ACQUISITION PROCESS.

22 (a) DEVELOPMENT OF PROCESS REQUIRED.—The Ad23 ministrator for Federal Procurement Policy, in consulta24 tion with the heads of appropriate Federal agencies, shall

25 develop a results-oriented acquisition process for implemen-
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1 tation by agencies in acquisitions of property and services

2 by the Federal agencies. The process shall include the identi3 fication of quantitative measures and standards for deter4 mining the extent to which an acquisition of noncommercial

5 items by a Federal agency satisfies the needs for which the

6 items are being acquired.

7 (b) INAPPLICABILITY OF PROCESS TO DEPARTMENT OF

8 DEFENSE.—The process developed pursuant to subsection

9 (a) may not be applied to the Department of Defense.

10 Subtitle C—Miscellaneous

11 SEC. 5091. CONTRACTOR EXCEPTIONAL PERFORMANCE

12 AWARDS.

13 The Office of Federal Procurement Policy Act, as

14 amended by section 4021, is further amended by adding at

15 the end the following:

16 ‘‘CONTRACTOR EXCEPTIONAL PERFORMANCE AWARDS

17 ‘‘SEC. 31. (a) ESTABLISHMENT.—There is hereby es18 tablished an executive branch program to recognize and

19 promote exceptional contract performance by Federal Gov20 ernment contractors.

21 ‘‘(b) SELECTION.—(1) The Administrator shall ensure

22 the establishment of criteria for selection of contractors to

23 receive exceptional performance awards under the program.

24 ‘‘(2) The head of an executive agency may select one

25 or more agency contractors to receive an exceptional per26 formance award under the program.
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1 ‘‘(c) AWARD CEREMONY.—The Vice President, or the

2 head of the executive agency selecting a contractor for an

3 exceptional performance award, shall present the award to

4 the contractor with such ceremony as the Vice President or

5 head of the agency, as the case may be, considers appro6 priate.’’.

7 SEC. 5092. DEPARTMENT OF DEFENSE ACQUISITION OF IN8 TELLECTUAL PROPERTY RIGHTS.

9 Section 2386 of title 10, United States Code, is amend10 ed by striking out paragraphs (3) and (4) and inserting

11 in lieu thereof the following:

12 ‘‘(3) Technical data and computer software.

13 ‘‘(4) Releases for past infringement of patents or

14 copyrights or for unauthorized use of technical data

15 or computer software.’’.

16 TITLE VI—STANDARDS OF

17 CONDUCT

18 Subtitle A—Ethics Provisions

19 SEC. 6001. AMENDMENTS TO OFFICE OF FEDERAL PRO20 CUREMENT POLICY ACT.

21 (a) RECUSAL.—Subsection (c) of section 27 of the Of22 fice of Federal Procurement Policy Act (41 U.S.C. 423) is

23 amended—

24 (1) in paragraph (1)—
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1 (A) in the matter above subparagraph (A),

2 by inserting ‘‘only’’ after ‘‘subsection (b)(1)’’;

3 and

4 (B) in subparagraph (A), by inserting ‘‘(in5 cluding the modification or extension of a con6 tract)’’ after ‘‘any procurement’’;

7 (2) by striking out paragraphs (2) and (3) and

8 inserting in lieu thereof:

9 ‘‘(2) Whenever the head of a procuring activity ap10 proves a recusal under paragraph (1), a copy of the recusal

11 request and the approval of the request shall be retained

12 by such official for a period (not less than five years) speci13 fied in regulations prescribed in accordance with subsection

14 (o).

15 ‘‘(3)(A) Except as provided in subparagraph (B), all

16 recusal requests and approvals of recusal requests pursuant

17 to this subsection shall be made available to the public on

18 request.

19 ‘‘(B) Any part of a recusal request or an approval of

20 a recusal request that is exempt from the disclosure require21 ments of section 552 of title 5, United States Code, under

22 subsection (b)(1) of such section may be withheld from dis23 closure to the public otherwise required under subparagraph

24 (A).’’; and
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1 (3) in paragraph (4), by striking out ‘‘competing

2 contractor’’ and inserting in lieu thereof ‘‘person’’.

3 (b) APPLICABILITY OF CERTIFICATION REQUIRE4 MENT.—Subsection (e)(7)(A) of such section is amended by

5 adding at the end the following: ‘‘However, paragraph

6 (1)(B) does not apply with respect to a contract for less

7 than $500,000.’’.

8 (c) RESTRICTIONS RESULTING FROM PROCUREMENT

9 ACTIVITIES OF PROCUREMENT OFFICIALS.—Subsection (f)

10 of such section is amended—

11 (1) by redesignating paragraph (3) as para12 graph (4); and

13 (2) by striking out paragraphs (1) and (2) and

14 inserting in lieu thereof the following:

15 ‘‘(1) No individual who, in the year prior to separa16 tion from service as an officer or employee of the Govern17 ment or an officer of the uniformed services in a covered

18 position, participated personally and substantially in ac19 quisition functions related to a contract, subcontract, or

20 claim of $500,000 or more and—

21 ‘‘(A) engaged in repeated direct contact with the

22 contractor or subcontractor on matters relating to

23 such contract, subcontract, or claim; or

24 ‘‘(B) exercised significant ongoing decisionmak25 ing responsibility with respect to the contractor or
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1 subcontractor on matters relating to such contract,

2 subcontract, or claim,

3 shall knowingly accept or continue employment with such

4 contractor or subcontractor for a period of 1 year following

5 the individual’s separation from service, except that such

6 individual may accept or continue employment with any

7 division or affiliate of such contractor or subcontractor that

8 does not produce the same or similar products as the entity

9 involved in the negotiation or performance of the contract

10 or subcontract or the adjustment of the claim.

11 ‘‘(2) No contractor or subcontractor, or any officer, em12 ployee, agent, or consultant of such contractor or sub13 contractor shall knowingly offer, provide, or continue any

14 employment for another person, if such contractor, sub15 contractor, officer, employee, agent, or consultant knows or

16 should know that the acceptance of such employment is or

17 would be in violation of paragraph (1).

18 ‘‘(3) The head of each Federal agency shall designate

19 in writing as a ‘covered position’ under this section each

20 of the following positions in that agency:

21 ‘‘(A) The position of source selection authority,

22 member of a source selection evaluation board, or

23 chief of a financial or technical evaluation team, or

24 any other position, if the officer or employee in that

25 position is likely personally to exercise substantial re-
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1 sponsibility for ongoing discretionary functions in the

2 evaluation of proposals or the selection of a source for

3 a contract in excess of $500,000.

4 ‘‘(B) The position of procuring contracting offi5 cer, or any other position, if the officer or employee

6 in that position is likely personally to exercise sub7 stantial responsibility for ongoing discretionary func8 tions in the negotiation of a contract in excess of

9 $500,000 or the negotiation or settlement of a claim

10 in excess of $500,000.

11 ‘‘(C) The position of program executive officer,

12 program manager, or deputy program manager, or

13 any other position, if the officer or employee in that

14 position is likely personally to exercise similar sub15 stantial responsibility for ongoing discretionary func16 tions in the management or administration of a con17 tract in excess of $500,000.

18 ‘‘(D) The position of administrative contracting

19 officer, the position of an officer or employee assigned

20 on a permanent basis to a Government Plant Rep21 resentative’s Office, the position of auditor, a quality

22 assurance position, or any other position, if the offi23 cer or employee in that position is likely personally

24 to exercise substantial responsibility for ongoing dis25 cretionary functions in the on-site oversight of a con-
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1 tractor’s operations with respect to a contract in ex2 cess of $500,000.

3 ‘‘(E) A position in which the incumbent is likely

4 personally to exercise substantial responsibility for

5 ongoing discretionary functions in operational or de6 velopmental testing activities involving repeated di7 rect contact with a contractor regarding a contract in

8 excess of $500,000.’’.

9 (d) DISCLOSURE OF PROPRIETARY OR SOURCE SELEC10 TION INFORMATION TO UNAUTHORIZED PERSONS.—Sub11 section (l) of such section is amended—

12 (1) by inserting ‘‘who are likely to be involved

13 in contracts, modifications, or extensions in excess of

14 $25,000’’ in the first sentence after ‘‘its procurement

15 officials’’; and

16 (2) by striking out ‘‘(e)’’ each place it appears

17 and inserting in each such place ‘‘(f)’’.

18 (e) RULES OF CONSTRUCTION.—Subsection (n) of such

19 section is amended to read as follows:

20 ‘‘(n) RULES OF CONSTRUCTION.—Nothing in this sec21 tion shall be construed to—

22 ‘‘(1) authorize the withholding of any informa23 tion from the Congress, any committee or subcommit24 tee thereof, a Federal agency, any board of contract
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1 appeals of a Federal agency, the Comptroller General,

2 or an inspector general of a Federal agency;

3 ‘‘(2) restrict the disclosure of information to, or

4 receipt of information by, any person or class of per5 sons authorized, in accordance with applicable agency

6 regulations or procedures, to receive that information;

7 ‘‘(3) restrict a contractor from disclosing its own

8 proprietary information or the recipient of informa9 tion so disclosed by a contractor from receiving such

10 information; or

11 ‘‘(4) restrict the disclosure or receipt of informa12 tion relating to a Federal agency procurement that

13 has been canceled by the agency and that the con14 tracting officer concerned determines in writing is not

15 likely to be resumed.’’.

16 (f) TERM TO BE DEFINED IN REGULATIONS.—Sub17 section (o)(2)(A) of such section is amended—

18 (1) by inserting ‘‘money, gratuity, or other’’ be19 fore ‘‘thing of value’ ’’; and

20 (2) by inserting before the semicolon ‘‘and such

21 other exceptions as may be adopted on a Government22 wide basis under section 7353 of title 5, United States

23 Code’’.

24 (g) TERMS DEFINED IN LAW.—Subsection (p) of such

25 section is amended—
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1 (1) in paragraph (1) by striking out ‘‘clauses

2 (i)–(viii)’’ and inserting in lieu thereof ‘‘clauses (i)

3 through (vii)’’;

4 (2) in paragraph (3)—

5 (A) in subparagraph (A)—

6 (i) by striking out clause (i);

7 (ii) by redesignating clauses (ii), (iii),

8 (iv), (v), (vi), (vii), and (viii) as clauses (i),

9 (ii), (iii), (iv), (v), (vi), and (vii), respec10 tively; and

11 (iii) in clause (i) (as redesignated by

12 subclause (II) of this clause), by striking out

13 ‘‘review and approval of a specification’’

14 and inserting in lieu thereof ‘‘approval or

15 issuance of a specification, acquisition plan,

16 procurement request, or requisition’’; and

17 (B) in subparagraph (B), by striking out

18 all after ‘‘includes’’ and inserting in lieu thereof

19 the following: ‘‘any individual acting on behalf

20 of, or providing advice to, the agency with re21 spect to any phase of the agency procurement

22 concerned, regardless of whether such individual

23 is a consultant, expert, or adviser, or an officer

24 or employee of a contractor or subcontractor

25 (other than a competing contractor).’’; and
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1 (3) in paragraph (6)(A), by inserting

2 ‘‘nonpublic’’ before ‘‘information’’.

3 SEC. 6002. AMENDMENTS TO TITLE 18, UNITED STATES

4 CODE.

5 Section 208(a) of title 18, United States Code, is

6 amended—

7 (1) by inserting ‘‘(1)’’ before ‘‘Except as per8 mitted’’; and

9 (2) by adding at the end the following new para10 graph:

11 ‘‘(2) Whoever knowingly aids, abets, counsels, com12 mands, induces, or procures conduct prohibited by this sec13 tion shall be subject to the penalties set forth in section 216

14 of this title.’’.

15 SEC. 6003. REPEAL OF SUPERSEDED AND OBSOLETE LAWS.

16 (a) REPEAL.—The following provisions of law are re17 pealed:

18 (1) Sections 2207, 2397, 2397a, 2397b, and

19 2397c of title 10, United States Code.

20 (2) Section 281 of title 18, United States Code.

21 (3) Section 801 of title 37, United States Code.

22 (4) Part A of title VI of the Department of En23 ergy Organization Act (42 U.S.C. 7211 through

24 7218).

25 (b) CLERICAL AMENDMENTS.—
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1 (1) TITLE 10.—Part IV of subtitle A of title 10,

2 United States Code, is amended—

3 (A) in the table of sections at the beginning

4 of chapter 131, by striking out the item relating

5 to section 2207; and

6 (B) in the table of sections for chapter 141,

7 by striking out the items relating to sections

8 2397, 2397a, 2397b, and 2397c.

9 (2) TITLE 18.—The table of sections for chapter

10 15 of title 18, United States Code, is amended by

11 striking out the item relating to section 281.

12 (3) TITLE 37.—The table of sections for chapter

13 15 of title 37, United States Code, is amended by

14 striking out the item relating to section 801.

15 (4) DEPARTMENT OF ENERGY ORGANIZATION

16 ACT.—The table of contents for the Department of En17 ergy Organization Act is amended by striking out the

18 matter relating to part A of title VI.

19 SEC. 6004. IMPLEMENTATION.

20 (a) REGULATIONS.—Not later than 180 days after the

21 date of the enactment of this Act, regulations implementing

22 the amendments made by section 6001 to section 27 of the

23 Office of Federal Procurement Policy Act (41 U.S.C. 423),

24 including definitions of the terms used in subsection (f) of

25 such section, shall be issued in accordance with sections 6
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1 and 25 of such Act (41 U.S.C. 405 and 521) after coordina2 tion with the Director of the Office of Government Ethics.

3 (b) SAVINGS PROVISIONS.—

4 (1) CONTRACTOR CERTIFICATIONS.—No officer,

5 employee, agent, representative, or consultant of a

6 contractor who has signed a certification under sec7 tion 27(e)(1)(B) of the Office of Federal Procurement

8 Policy Act (41 U.S.C. 423(e)(1)(B)) before the effec9 tive date of this Act shall be required to sign a new

10 certification as a result of the enactment of this Act.

11 (2) FEDERAL PROCUREMENT OFFICIAL CERTIFI12 CATIONS.—No procurement official of a Federal agen13 cy who has signed a certification under section 27(l)

14 of the Office of Federal Procurement Policy Act (41

15 U.S.C. 423(l)) before the date of enactment of this Act

16 shall be required to sign a new certification as a re17 sult of the enactment of this Act.

18 (c) INSPECTOR GENERAL REPORTS.—Not later than

19 May 31 of each of the years 1995 through 1998, the Inspec20 tor General of each Federal agency (or, in the case of a

21 Federal agency that does not have an Inspector General,

22 the head of such agency) shall submit to Congress a report

23 on the compliance by the agency during the preceding year

24 with the requirement for the head of the agency to designate

25 covered procurement positions under section 27(f)(3) of the
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1 Office of Federal Procurement Policy Act (as added by sec2 tion 6001(c)).

3 Subtitle B—Additional

4 Amendments

5 SEC. 6051. CONTRACTING FUNCTIONS PERFORMED BY FED6 ERAL PERSONNEL.

7 (a) AMENDMENT OF OFPP ACT.—The Office of Fed8 eral Procurement Policy Act, as amended by section 1092,

9 is further amended by inserting after section 22 the follow10 ing new section 23:

11 ‘‘CONTRACTING FUNCTIONS PERFORMED BY FEDERAL

12 PERSONNEL

13 ‘‘SEC. 23. (a) LIMITATION ON PAYMENT FOR ADVISORY

14 AND ASSISTANCE SERVICES.—(1) No person who is not a

15 person described in subsection (b) may be paid by an agen16 cy for services to conduct evaluations or analyses of any

17 aspect of a proposal submitted for an acquisition unless per18 sonnel described in subsection (b) with adequate training

19 and capabilities to perform such evaluations and analyses

20 are not readily available within the agency or another Fed21 eral agency, as determined in accordance with standards

22 and procedures prescribed in the Federal Acquisition Regu23 lation.

24 ‘‘(2) In the administration of this subsection, the head

25 of each agency shall determine in accordance with the
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1 standards and procedures set forth in the Federal Acquisi2 tion Regulation whether—

3 ‘‘(A) a sufficient number of personnel described

4 in subsection (b) within the agency or another Fed5 eral agency are readily available to perform a par6 ticular evaluation or analysis for the agency head

7 making the determination; and

8 ‘‘(B) the readily available personnel have the

9 training and capabilities necessary to perform the

10 evaluation or analysis.

11 ‘‘(b) COVERED PERSONNEL.—For purposes of sub12 section (a), the personnel described in this subsection are

13 as follows:

14 ‘‘(1) An employee, as defined in section 2105 of

15 title 5, United States Code.

16 ‘‘(2) A member of the Armed Forces of the Unit17 ed States.

18 ‘‘(3) A person assigned to a Federal agency pur19 suant to subchapter VI of chapter 33 of title 5, United

20 States Code.

21 ‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sec22 tion is intended to affect the relationship between the Fed23 eral Government and a federally funded research and devel24 opment center.’’.
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1 (b) REQUIREMENT FOR GUIDANCE AND REGULA2 TIONS.—Not later than 90 days after the date of the enact3 ment of this Act, the Federal Acquisition Regulatory Coun4 cil established by section 25(a) of the Office of Federal Pro5 curement Policy Act (41 U.S.C. 421(a)) shall—

6 (1) review part 37 of title 48 of the Code of Fed7 eral Regulations as it relates to the use of advisory

8 and assistance services; and

9 (2) provide guidance and promulgate regulations

10 regarding—

11 (A) what actions Federal agencies are re12 quired to take to determine whether expertise is

13 readily available within the Federal Government

14 before contracting for advisory and technical

15 services to conduct acquisitions; and

16 (B) the manner in which personnel with ex17 pertise may be shared with agencies needing ex18 pertise for such acquisitions.

19 SEC. 6052. REPEAL OF EXECUTED REQUIREMENT FOR

20 STUDY AND REPORT.

21 Section 17 of the Office of Federal Procurement Policy

22 Act (41 U.S.C. 415) is repealed.

23 SEC. 6053. INTERESTS OF MEMBERS OF CONGRESS.

24 Section 3741 of the Revised Statutes (41 U.S.C. 22)

25 is amended to read as follows:
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1 ‘‘No member of Congress shall be admitted to any share

2 or part of any contract or agreement made, entered into,

3 or accepted by or on behalf of the United States, or to any

4 benefit to arise thereupon.’’.

5 SEC. 6054. WAITING PERIOD FOR SIGNIFICANT CHANGES

6 PROPOSED FOR ACQUISITION REGULATIONS.

7 Section 22(a) of the Office of Federal Procurement Pol8 icy Act (41 U.S.C. 418b) is amended—

9 (1) by striking out ‘‘30 days’’ and inserting in

10 lieu thereof ‘‘60 days’’; and

11 (2) by adding at the end the following: ‘‘Notwith12 standing the preceding sentence, such a policy, regula13 tion, procedure, or form may take effect earlier than

14 60 days after the publication date when there are

15 compelling circumstances for the earlier effective date,

16 but in no event may that effective date be less than

17 30 days after the publication date.’’.

18 Subtitle C—Whistleblower

19 Protection

20 SEC. 6101. ARMED SERVICES PROCUREMENTS.

21 (a) WHISTLEBLOWER PROTECTIONS FOR CONTRACTOR

22 EMPLOYEES.—Section 2409 of title 10, United States Code,

23 is amended—

24 (1) by striking out subsection (d);
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1 (2) by redesignating subsection (c) as subsection

2 (d); and

3 (3) by inserting after subsection (b) the following

4 new subsection (c):

5 ‘‘(c) REMEDY AND ENFORCEMENT AUTHORITY.—(1) If

6 the Secretary of Defense determines that a defense contrac7 tor has subjected a person to a reprisal prohibited by sub8 section (a), the Secretary may take one or more of the fol9 lowing actions:

10 ‘‘(A) Order the defense contractor to take affirm11 ative action to abate the reprisal.

12 ‘‘(B) Order the defense contractor to reinstate the

13 person to the position that the person held before the

14 reprisal, together with the compensation (including

15 back pay), employment benefits, and other terms and

16 conditions of employment that would apply to the

17 person in that position if the reprisal had not been

18 taken.

19 ‘‘(C) Order the defense contractor to pay the

20 complainant an amount equal to the aggregate

21 amount of all costs and expenses (including attorney’s

22 fees and expert witnesses’ fees) that were reasonably

23 incurred by the complainant for, or in connection

24 with, bringing the complaint regarding the reprisal,

25 as determined by the Secretary.
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1 ‘‘(2) Whenever a person fails to comply with an order

2 issued under paragraph (1), the Secretary shall file an ac3 tion for enforcement of such order in the United States dis4 trict court for a district in which the reprisal was found

5 to have occurred. In any action brought under this para6 graph, the court may grant appropriate relief, including

7 injunctive relief and compensatory and exemplary dam8 ages.

9 ‘‘(3) Any person adversely affected or aggrieved by an

10 order issued under paragraph (1) may obtain review of the

11 order’s conformance with this subsection, and any regula12 tions issued to carry out this section, in the United States

13 court of appeals for a circuit in which the reprisal is alleged

14 in the order to have occurred. No petition seeking such re15 view may be filed more than 60 days after issuance of the

16 Secretary’s order. Review shall conform to chapter 7 of title

17 5.’’.

18 (b) RELATED LAW.—

19 (1) REPEAL.—Section 2409a of title 10, United

20 States Code, is repealed.

21 (2) CLERICAL AMENDMENT.—The table of sec22 tions at the beginning of chapter 141 of such title is

23 amended by striking out the item relating to section

24 2409a.
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1 SEC. 6102. GOVERNMENTWIDE WHISTLEBLOWER PROTEC2 TIONS FOR CONTRACTOR EMPLOYEES.

3 The Office of Federal Procurement Policy Act (41

4 U.S.C. 401 et seq.), as amended by section 5091, is further

5 amended by adding at the end the following new section:

6 ‘‘CONTRACTOR EMPLOYEES: PROTECTION FROM REPRISAL

7 FOR DISCLOSURE OF CERTAIN INFORMATION

8 ‘‘SEC. 32. (a) PROHIBITION OF REPRISALS.—An em9 ployee of an executive agency contractor may not be dis10 charged, demoted, or otherwise discriminated against as a

11 reprisal for disclosing to a Member of Congress or an au12 thorized official of the agency or the Department of Justice

13 information relating to a substantial violation of law relat14 ed to an agency contract (including the competition for or

15 negotiation of an agency contract).

16 ‘‘(b) INVESTIGATION OF COMPLAINTS.—A person who

17 believes that the person has been subjected to a reprisal pro18 hibited by subsection (a) may submit a complaint to the

19 Inspector General of the executive agency. Unless the In20 spector General determines that the complaint is frivolous,

21 the Inspector General shall investigate the complaint and,

22 upon completion of such investigation, submit a report of

23 the findings of the investigation to the person, the contractor

24 concerned, and the head of the agency. In the case of an

25 executive agency that does not have an inspector general,
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1 the duties of the inspector general under this section shall

2 be performed by an official designated by the agency head.

3 ‘‘(c) REMEDY AND ENFORCEMENT AUTHORITY.—(1) If

4 the head of an executive agency determines that an agency

5 contractor has subjected a person to a reprisal prohibited

6 by subsection (a), the agency head may take one or more

7 of the following actions:

8 ‘‘(A) Order the contractor to take affirmative ac9 tion to abate the reprisal.

10 ‘‘(B) Order the contractor to reinstate the person

11 to the position that the person held before the reprisal,

12 together with the compensation (including back pay),

13 employment benefits, and other terms and conditions

14 of employment that would apply to the person in that

15 position if the reprisal had not been taken.

16 ‘‘(C) Order the contractor to pay the complain17 ant an amount equal to the aggregate amount of all

18 costs and expenses (including attorney’s fees and ex19 pert witnesses’ fees) that were reasonably incurred by

20 the complainant for, or in connection with, bringing

21 the complaint regarding the reprisal, as determined

22 by the Secretary.

23 ‘‘(2) Whenever a person fails to comply with an order

24 issued under paragraph (1), the agency head shall file an

25 action for enforcement of such order in the United States
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1 district court for a district in which the reprisal was found

2 to have occurred. In any action brought under this para3 graph, the court may grant appropriate relief, including

4 injunctive relief and compensatory and exemplary dam5 ages.

6 ‘‘(3) Any person adversely affected or aggrieved by an

7 order issued under paragraph (1) may obtain review of the

8 order’s conformance with this subsection, and any regula9 tions issued to carry out this section, in the United States

10 court of appeals for a circuit in which the reprisal is alleged

11 in the order to have occurred. No petition seeking such re12 view may be filed more than 60 days after issuance of the

13 agency head’s order. Review shall conform to chapter 7 of

14 title 5, United States Code.

15 ‘‘(d) CONSTRUCTION.—Nothing in this section may be

16 construed to authorize the discharge of, demotion of, or dis17 crimination against an employee for a disclosure other than

18 a disclosure protected by subsection (a) or to modify or der19 ogate from a right or remedy otherwise available to the em20 ployee.

21 ‘‘(e) COORDINATION WITH OTHER LAW.—This section

22 does not apply with respect to the Department of Defense.

23 For the corresponding provision of law applicable to the

24 Department of Defense, see section 2409 of title 10, United

25 States Code.
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1 ‘‘(f) DEFINITION.—In this section, the term ‘Inspector

2 General’ means an Inspector General appointed under the

3 Inspector General Act of 1978.’’.

4 TITLE VII—DEFENSE TRADE AND

5 COOPERATION

6 SEC. 7001. PURCHASES OF FOREIGN GOODS.

7 (a) REPEAL OF EXECUTED REQUIREMENTS.—

8 (1) REQUIREMENT FOR POLICY GUIDANCE.—

9 Title III of the Act of March 3, 1933 (41 U.S.C. 10a

10 et seq.), commonly referred to as the ‘‘Buy American

11 Act’’, is amended in section 4(g) (41 U.S.C. 10b–1(g))

12 by striking out paragraphs (2)(C) and (3).

13 (2) REPORTING REQUIREMENT.—Section 9096(b)

14 of Public Law 102–396 (106 Stat. 1924; 41 U.S.C.

15 10b–2(b)) is repealed.

16 (b) REPEAL OF REDUNDANT PROVISION.—

17 (1) CONSIDERATION OF NATIONAL SECURITY OB18 JECTIVES.—Section 2327 of title 10, United States

19 Code, is repealed.

20 (2) CLERICAL AMENDMENT.—The table of sec21 tions at the beginning of chapter 137 of such title is

22 amended by striking out the item relating to section

23 2327.
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1 SEC. 7002. INTERNATIONAL COOPERATIVE AGREEMENTS.

2 (a) TERMINOLOGY REVISIONS.—Section 2531 of title

3 10, United States Code, is amended—

4 (1) in the subsection captions for subsections (a)

5 and (c), by striking out ‘‘MOUS AND RELATED’’ and

6 inserting in lieu thereof ‘‘INTERNATIONAL’’;

7 (2) in subsection (a), by striking out ‘‘proposed

8 memorandum of understanding, or any existing or

9 proposed agreement related to a memorandum of un10 derstanding,’’ in the matter above paragraph (1) and

11 inserting in lieu thereof ‘‘proposed international

12 agreement, including a memorandum of understand13 ing,’’;

14 (3) by striking out ‘‘memorandum of under15 standing or related agreement’’ each place it appears

16 and inserting in lieu thereof ‘‘international agree17 ment’’;

18 (4) in subsection (b), by striking out ‘‘memoran19 dum or related agreement’’ each place it appears in

20 the second sentence and inserting in lieu thereof

21 ‘‘international agreement’’; and

22 (5) in subsection (c)—

23 (A) by striking out ‘‘A’’ after ‘‘AGREE24 MENTS.—’’ and inserting in lieu thereof ‘‘An’’;

25 and
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1 (B) by striking out ‘‘memorandum or agree2 ment’’ and inserting in lieu thereof ‘‘inter3 national agreement’’.

4 (b) EXPANDED SCOPE OF AGREEMENTS.—Section

5 2531(a) of title 10, United States Code, is amended by strik6 ing out ‘‘research, development, or production’’ in the mat7 ter above paragraph (1) and inserting in lieu thereof ‘‘re8 search, development, production, or logistics support’’.

9 (c) CLERICAL AMENDMENTS.—

10 (1) SECTION HEADING.—The heading of section

11 2531 of title 10, United States Code, is amended to

12 read as follows:

13 ‘‘§ 2531. Defense international agreements’’.

14 (2) TABLE OF SECTIONS.—The item relating to

15 such section in the table of sections at the beginning

16 of subchapter V of chapter 148 of such title is amend17 ed to read as follows:

‘‘2531. Defense international agreements.’’.

18 SEC. 7003. ACQUISITION, CROSS-SERVICING AGREEMENTS,

19 AND STANDARDIZATION.

20 (a) LIMITED WAIVER OF RESTRICTIONS ON ACCRUED

21 REIMBURSABLE LIABILITIES AND CREDITS FOR CONTIN22 GENCY OPERATIONS.—Section 2347 of title 10, United

23 States Code, is amended by adding at the end the following

24 new subsection:
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1 ‘‘(c) The Secretary of Defense may waive the restric2 tions in subsections (a) and (b) for a period not to exceed

3 180 days upon a written determination that the armed

4 forces are involved in a contingency operation or that in5 volvement of the armed forces in a contingency operation

6 is imminent. Upon making such a determination, the Sec7 retary shall transmit a copy of the determination to the

8 Committees on Armed Services of the Senate and House of

9 Representatives.’’.

10 (b) COMMUNICATIONS SUPPORT.—Section 2350f of

11 title 10, United States Code, is amended—

12 (1) by redesignating subsection (d) as subsection

13 (e); and

14 (2) by inserting after subsection (c) the following

15 new subsection:

16 ‘‘(d)(1) Nothing in this section shall be construed to

17 limit the authority of the Secretary of Defense, without a

18 formal bilateral agreement or multilateral arrangement, to

19 furnish communications support and related supplies to, or

20 receive communications support and related supplies from,

21 an allied country in accordance with this subsection.

22 ‘‘(2) The Secretary of Defense may furnish or receive

23 such support and supplies on a reciprocal basis for a period

24 not to exceed 90 days—
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1 ‘‘(A) in order to meet emerging operational re2 quirements of the United States and the allied coun3 try; or

4 ‘‘(B) incident to a joint military exercise with

5 the allied country.

6 ‘‘(3) If interconnection of communication circuits is

7 maintained for joint or multilateral defense purposes under

8 the authority of this subsection, the costs of maintaining

9 such circuits may be allocated among the various users.’’.

10 TITLE VIII—COMMERCIAL ITEMS

11 SEC. 8001. DEFINITIONS.

12 Section 4 of the Office of Federal Procurement Policy

13 Act (41 U.S.C. 403), as amended by section 4001(a), is fur14 ther amended—

15 (1) by striking out ‘‘Act—’’and inserting in lieu

16 thereof ‘‘Act:’’;

17 (2) by capitalizing the initial letter in the first

18 word of each paragraph;

19 (3) by striking out the semicolon at the end of

20 each of paragraphs (1), (2), (3), (5), (6), (7), (8), and

21 (9) and inserting in lieu thereof a period;

22 (4) in paragraphs (4) and (10), by striking out

23 ‘‘; and’’ at the end and inserting in lieu thereof a pe24 riod; and
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1 (5) by adding at the end the following new para2 graphs:

3 ‘‘(12) The term ‘commercial item’ means—

4 ‘‘(A) property, other than real property,

5 that is of a type customarily used by the general

6 public or by nongovernmental entities in the

7 course of normal business operations for purposes

8 other than governmental purposes and—

9 ‘‘(i) has been sold, leased, or licensed to

10 the general public;

11 ‘‘(ii) has not been sold, leased, or li12 censed to the general public but has been of13 fered for sale, lease, or license to the general

14 public; or

15 ‘‘(iii) is not yet available in the com16 mercial marketplace but will be made avail17 able for commercial delivery within a rea18 sonable period;

19 ‘‘(B) any item that, but for—

20 ‘‘(i) modifications of a type customar21 ily available in the commercial market22 place, or

23 ‘‘(ii) minor modifications made to

24 meet Federal Government requirements,

25 would satisfy the criteria in subparagraph (A);
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1 ‘‘(C) any combination of items meeting the

2 requirements of subparagraph (A), (B), or (D)

3 that are of a type customarily combined and sold

4 in combination to the general public;

5 ‘‘(D) installation services, maintenance

6 services, repair services, training services, and

7 other services if such services are procured for

8 support of an item referred to in subparagraph

9 (A), (B), or (C) and if the source of such serv10 ices—

11 ‘‘(i) offers such services to the general

12 public and the Federal Government contem13 poraneously and under similar terms and

14 conditions; and

15 ‘‘(ii) offers to use the same work force

16 for providing the Federal Government with

17 such services as the source uses for provid18 ing such services to the general public; and

19 ‘‘(E) any item, combination of items, or

20 service referred to in subparagraph (A), (B), (C),

21 or (D), regardless of whether the item, combina22 tion of items, or service is transferred between or

23 among separate divisions, subsidiaries, or affili24 ates of a contractor.
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1 ‘‘(13) The term ‘nondevelopmental item’

2 means—

3 ‘‘(A) any commercial item;

4 ‘‘(B) any previously developed item of sup5 ply that is in use by a department or agency of

6 the United States, a State or local government,

7 or a foreign government with which the United

8 States has a mutual defense cooperation agree9 ment;

10 ‘‘(C) any item of supply described in sub11 paragraph (A) or (B) that requires only minor

12 modification of the type normally available in

13 the commercial marketplace in order to meet the

14 requirements of the procuring department or

15 agency; or

16 ‘‘(D) any item of supply currently being

17 produced that does not meet the requirements of

18 subparagraph (A), (B), or (C) solely because the

19 item—

20 ‘‘(i) is not yet in use; or

21 ‘‘(ii) is not yet available in the com22 mercial marketplace.

23 ‘‘(14) The term ‘component’ means any item

24 supplied to the Federal Government as part of an end

25 item or of another component.
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1 ‘‘(15) The term ‘commercial component’ means

2 any component that is a commercial item.’’.

3 SEC. 8002. PREFERENCE FOR ACQUISITION OF COMMER4 CIAL ITEMS AND NONDEVELOPMENTAL

5 ITEMS.

6 (a) PREFERENCE REQUIRED.—The Office of Federal

7 Procurement Policy Act (41 U.S.C. 401 et seq.), as amended

8 by section 6102, is further amended by adding at the end

9 the following new section:

10 ‘‘PREFERENCE FOR ACQUISITION OF COMMERCIAL ITEMS

11 AND NONDEVELOPMENTAL ITEMS

12 ‘‘SEC. 33. (a) PREFERENCE.—The head of each execu13 tive agency shall ensure that, to the maximum extent prac14 ticable—

15 ‘‘(1) requirements of the executive agency with

16 respect to a procurement of supplies are stated in

17 terms of—

18 ‘‘(A) functions to be performed;

19 ‘‘(B) performance required; or

20 ‘‘(C) essential physical characteristics;

21 ‘‘(2) such requirements are defined so that com22 mercial items or, to the extent that commercial items

23 suitable to meet the agency’s needs are not available,

24 other nondevelopmental items may be procured to ful25 fill such requirements; and
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1 ‘‘(3) offerors of commercial items and other

2 nondevelopmental items are provided an opportunity

3 to compete in any procurement to fill such require4 ments.

5 ‘‘(b) IMPLEMENTATION.—The head of each executive

6 agency shall ensure that procurement officials in that execu7 tive agency, to the maximum extent practicable—

8 ‘‘(1) acquire commercial items or other

9 nondevelopmental items to meet the needs of the exec10 utive agency;

11 ‘‘(2) require prime contractors and subcontrac12 tors at all levels under the executive agency contracts

13 to incorporate commercial items or other

14 nondevelopmental items as components of items sup15 plied to the executive agency;

16 ‘‘(3) modify requirements in appropriate cases to

17 ensure that the requirements can be met by commer18 cial items or, to the extent that commercial items

19 suitable to meet the agency’s needs are not available,

20 other nondevelopmental items;

21 ‘‘(4) state specifications in terms that enable and

22 encourage bidders and offerors to supply commercial

23 items or, to the extent that commercial items suitable

24 to meet the agency’s needs are not available, other
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1 nondevelopmental items in response to the executive

2 agency solicitations;

3 ‘‘(5) revise the executive agency’s procurement

4 policies, practices, and procedures not required by

5 law to reduce any impediments in those policies,

6 practices, and procedures to the acquisition of com7 mercial items; and

8 ‘‘(6) require training of appropriate personnel in

9 the acquisition of commercial items.

10 ‘‘(c) PRELIMINARY MARKET RESEARCH.—(1) The

11 head of an executive agency shall conduct market research

12 appropriate to the circumstances—

13 ‘‘(A) before developing new specifications for a

14 procurement by that executive agency; and

15 ‘‘(B) before soliciting bids or proposals for a con16 tract in excess of the simplified acquisition threshold.

17 ‘‘(2) The head of an executive agency shall use the re18 sults of market research to determine whether there are com19 mercial items or, to the extent that commercial items suit20 able to meet the agency’s needs are not available, other

21 nondevelopmental items available that—

22 ‘‘(A) meet the executive agency’s requirements;

23 ‘‘(B) could be modified to meet the executive

24 agency’s requirements; or
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1 ‘‘(C) could meet the executive agency’s require2 ments if those requirements were modified to a rea3 sonable extent.’’.

4 (b) REPEAL OF SUPERSEDED PROVISION.—

5 (1) SEPARATE STATEMENT OF PREFERENCE FOR

6 DEPARTMENT OF DEFENSE.—Section 2325 of title 10,

7 United States Code, is repealed.

8 (2) CLERICAL AMENDMENT.—The table of sec9 tions at the beginning of chapter 137 of such title is

10 amended by striking out the item relating to section

11 2325.

12 SEC. 8003. ACQUISITION OF COMMERCIAL ITEMS.

13 (a) REQUIRED FAR PROVISIONS.—The Office of Fed14 eral Procurement Policy Act (41 U.S.C. 401 et seq.), as

15 amended by section 8002, is further amended by adding at

16 the end the following:

17 ‘‘FEDERAL ACQUISITION REGULATION PROVISIONS REGARD18 ING ACQUISITIONS OF COMMERCIAL ITEMS AND COM19 PONENTS

20 ‘‘SEC. 34. (a) CONTRACT CLAUSES AND OTHER

21 CLAUSES.—(1)(A) The Federal Acquisition Regulation

22 shall include one or more sets of contract clauses containing

23 the required terms and conditions for the acquisition of

24 commercial items and commercial components by executive

25 agencies and by contractors in the performance of contracts

26 of executive agencies.
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1 ‘‘(B) The contract clauses referred to in subparagraph

2 (A) shall include only—

3 ‘‘(i) those clauses that are required to implement

4 provisions of law applicable to acquisitions of com5 mercial items or commercial components, as the case

6 may be;

7 ‘‘(ii) those contract clauses that are essential for

8 the protection of the Federal Government’s interest in

9 an acquisition of commercial items or commercial

10 components, as the case may be; and

11 ‘‘(iii) those contract clauses that are determined

12 to be consistent with standard commercial practice.

13 ‘‘(2) Subject to paragraph (3), the Federal Acquisition

14 Regulation shall require that, to the maximum extent prac15 ticable, only the contract clauses referred to in paragraph

16 (1) be used in a contract, or be required to be used in a

17 subcontract, for the acquisition of commercial items or com18 mercial components by or for an executive agency.

19 ‘‘(3) The Federal Acquisition Regulation shall provide

20 that a contract or subcontract referred to in paragraph (2)

21 may contain contract clauses other than the contract clauses

22 referred to in that paragraph only if the other clauses are

23 essential for the protection of the Federal Government’s in24 terest in—
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1 ‘‘(A) that contract or subcontract, as determined

2 in writing by the contracting officer for such contract;

3 or

4 ‘‘(B) a class of contracts or subcontracts, as de5 termined by the head of an agency concerned, unless

6 the determination of that head of an agency is dis7 approved by the Administrator.

8 ‘‘(4) The Federal Acquisition Regulation shall provide

9 standards and procedures for waiving the use of contract

10 clauses required pursuant to paragraph (1), other than

11 those required by law, including standards for determining

12 the cases in which a waiver is appropriate.

13 ‘‘(b) MARKET ACCEPTANCE.—The Federal Acquisition

14 Regulation shall provide that under appropriate conditions

15 the head of an executive agency may require offerors to dem16 onstrate that the items offered—

17 ‘‘(1) have either—

18 ‘‘(A) achieved commercial market accept19 ance; or

20 ‘‘(B) been satisfactorily supplied to an exec21 utive agency under current or recent contracts

22 for the same or similar requirements; and

23 ‘‘(2) otherwise meet the item description, speci24 fications, or other criteria prescribed in the public no25 tice and solicitation relating to the contract.
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1 ‘‘(c) USE OF FIRM, FIXED PRICE CONTRACTS.—The

2 Federal Acquisition Regulation shall include a requirement

3 that firm, fixed price contracts or fixed price with economic

4 price adjustment contracts, be used, to the maximum extent

5 practicable, for the acquisition of commercial items.

6 ‘‘(d) CONTRACT QUALITY REQUIREMENTS.—The Fed7 eral Acquisition Regulation shall include provisions that—

8 ‘‘(1) permit, to the maximum extent practicable,

9 a contractor under a commercial items acquisition to

10 use the contractor’s existing quality assurance system

11 as a substitute for compliance with a requirement for

12 the Federal Government to inspect or test the commer13 cial items before the contractor’s tender of those items

14 for acceptance by the Federal Government;

15 ‘‘(2) require that, to the maximum extent prac16 ticable, an executive agency accept commercial war17 ranties (including extended warranties) offered by

18 offerors of commercial items to commercial customers

19 and use such warranties for the repair and replace20 ment of commercial items; and

21 ‘‘(3) set forth guidance to executive agencies re22 garding the use of past performance of items and

23 sources as a factor in contract award decisions.’’.

24 ‘‘(e) TREATMENT OF TRANSFERS BETWEEN AFFILI25 ATES.—The Federal Acquisition Regulation shall provide
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1 for a transfer of commercial items from one division, sub2 sidiary, or affiliate of a contractor to another division, sub3 sidiary, or affiliate of the contractor to be treated as a sub4 contract for purposes of section 35 of the Office of Federal

5 Procurement Policy Act and the provisions of law amended

6 by section 8005 of the Federal Acquisition Streamlining Act

7 of 1994.’’.

8 (b) DEFENSE CONTRACT CLAUSES.—

9 (1) TERMINATION OF DOD AUTHORITY.—Section

10 824(b) of the National Defense Authorization Act for

11 Fiscal Years 1990 and 1991 (Public Law 101–189; 10

12 U.S.C. 2325 note) shall cease to be effective on the

13 date on which the regulations implementing section

14 34 of the Office of Federal Procurement Policy Act, as

15 added by subsection (a), become effective.

16 (2) SAVINGS PROVISION.—Notwithstanding sec17 tion 34(a) of the Office of Federal Procurement Policy

18 Act (as added by subsection (a)), contracts of the De19 partment of Defense entered into before the date on

20 which section 824(b) ceases to be effective under para21 graph (1), and subcontracts entered into before such

22 date under such contracts, may include clauses devel23 oped pursuant to paragraphs (2) and (3) of section

24 824(b) of the National Defense Authorization Act for
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1 Fiscal Years 1990 and 1991 (Public Law 101–189; 10

2 U.S.C. 2325 note).

3 SEC. 8004. CLASS WAIVER OF APPLICABILITY OF CERTAIN

4 LAWS.

5 The Office of Federal Procurement Policy Act (41

6 U.S.C. 401 et seq.), as amended by section 8003, is further

7 amended by adding at the end the following:

8 ‘‘CLASS WAIVER OF APPLICABILITY OF CERTAIN LAWS TO

9 ACQUISITIONS OF COMMERCIAL ITEMS

10 ‘‘SEC. 35. (a) IN GENERAL.—The applicability of a

11 provision of law described in subsection (c) that is enacted

12 after the date of the enactment of the Federal Acquisition

13 Streamlining Act of 1994 to contracts for the acquisition

14 of commercial items may be waived on a class basis in the

15 Federal Acquisition Regulation. Such a waiver shall not

16 apply to a provision of law that expressly refers to this sec17 tion and prohibits the waiver of that provision of law.

18 ‘‘(b) WAIVER OF APPLICABILITY TO SUBCONTRACTS.—

19 (1) The applicability of a provision of law described in sub20 section (c) to subcontracts under a contract for the acquisi21 tion of commercial items or a subcontract for the acquisi22 tion of commercial components may be waived on a class

23 basis in the Federal Acquisition Regulation. Such a waiver

24 shall not apply to a provision of law that expressly refers

25 to this section and prohibits the waiver of that provision

26 of law.
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1 ‘‘(2) Nothing in this subsection shall be construed to

2 authorize the waiver of the applicability of any provision

3 of law with respect to—

4 ‘‘(A) any contract with a prime contractor; or

5 ‘‘(B) any subcontract under a contract with a

6 prime contractor who does not substantially trans7 form the commercial items supplied under the con8 tract.

9 ‘‘(c) COVERED LAW.—A provision of law referred to

10 in subsections (a) and (b) is any provision of law that, as

11 determined by the Federal Acquisition Regulatory Council,

12 sets forth policies, procedures, requirements, or restrictions

13 for the procurement of property or services by the Federal

14 Government.’’.

15 SEC. 8005. INAPPLICABILITY OF CERTAIN PROVISIONS OF

16 LAW.

17 (a) ARMED SERVICES ACQUISITIONS.—

18 (1) PROHIBITION ON CONTINGENT FEES.—Sec19 tion 2306(b) of title 10, United States Code, as

20 amended by section 4022(a), is further amended by

21 inserting before the period at the end of the sentence

22 added by section 4022(a) the following: ‘‘or to a con23 tract for the acquisition of commercial items’’.

24 (2) REQUIREMENT TO IDENTIFY SUPPLIERS AND

25 SOURCES OF SUPPLIES.—Paragraph (2) of section
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1 2384(b) of title 10, United States Code, is amended

2 to read as follows:

3 ‘‘(2) The regulations prescribed pursuant to paragraph

4 (1) do not apply to a contract that requires the delivery

5 of supplies that are commercial items, as defined in section

6 2302 of this title.’’.

7 (3) PROHIBITION AGAINST DOING BUSINESS

8 WITH CERTAIN OFFERORS OR CONTRACTORS.—Section

9 2393(d) of title 10, United States Code, as amended

10 by section 4022(e), is further amended by adding at

11 the end the following: ‘‘The requirement shall not

12 apply in the case of a subcontract for the acquisition

13 of commercial items (as defined in section 4(12) of the

14 Office of Federal Procurement Policy Act (41 U.S.C.

15 403(12))).’’.

16 (4) PROHIBITION ON LIMITATION OF SUB17 CONTRACTOR DIRECT SALES.—Section 2402 of title

18 10, United States Code, as amended by section

19 4022(b), is further amended by adding at the end the

20 following new subsection:

21 ‘‘(d)(1) An agreement between the contractor in a con22 tract for the acquisition of commercial items and a sub23 contractor under such contract that restricts sales by such

24 subcontractor directly to persons other than the contractor

25 may not be considered to unreasonably restrict sales by that
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1 subcontractor to the United States in violation of the provi2 sion included in such contract pursuant to subsection (a)

3 if the agreement does not result in the Federal Government

4 being treated differently with regard to the restriction than

5 any other prospective purchaser of such commercial items

6 from that subcontractor.

7 ‘‘(2) In paragraph (1), the term ‘commercial item’ has

8 the meaning given such term in section 4(12) of the Office

9 of Federal Procurement Policy Act (41 U.S.C. 403(12)).’’.

10 (5) CONTRACTOR INVENTORY ACCOUNTING SYS11 TEMS: STANDARDS.—Section 2410b of title 10, United

12 States Code, is amended—

13 (A) by inserting ‘‘(a) REGULATIONS RE14 QUIRED.—’’ before ‘‘The Secretary of Defense’’;

15 and

16 (B) by adding at the end the following new

17 subsection:

18 ‘‘(b) INAPPLICABILITY TO ACQUISITIONS OF COMMER19 CIAL ITEMS.—The regulations prescribed pursuant to sub20 section (a) need not apply to a contract for the acquisition

21 of commercial items (as defined in section 4(12) of the Of22 fice of Federal Procurement Policy Act (41 U.S.C.

23 403(12))).’’.

24 (6) PROHIBITION ON PERSONS CONVICTED OF

25 DEFENSE-CONTRACT RELATED FELONIES.—Paragraph
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1 (4) of section 2408(a) of title 10, United States Code,

2 as added by section 4022(f), is amended—

3 (A) by inserting after subparagraph (A) the

4 following:

5 ‘‘(B) A contract referred to in such subpara6 graph that is for the acquisition of commercial items

7 (as defined in section 4(12) of the Office of Federal

8 Procurement Policy Act (41 U.S.C. 403(12))).’’; and

9 (B) by inserting ‘‘or (B)’’ before the period

10 at the end of subparagraph (C).

11 (b) CIVILIAN AGENCY ACQUISITIONS.—

12 (1) RESTRICTIONS ON SUBCONTRACTOR SALES

13 TO THE UNITED STATES.—Section 303G of the Fed14 eral Property and Administrative Services Act of

15 1949 (41 U.S.C. 253g), as amended by section

16 4023(b), is further amended by adding at the end the

17 following new subsection:

18 ‘‘(d) An agreement between the contractor in a con19 tract for the acquisition of commercial items and a sub20 contractor under such contract that restricts sales by such

21 subcontractor directly to persons other than the contractor

22 may not be considered to unreasonably restrict sales by that

23 subcontractor to the United States in violation of the provi24 sion included in such contract pursuant to subsection (a)

25 if the agreement does not result in the Federal Government
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1 being treated differently with regard to the restriction than

2 any other prospective purchaser of such commercial items

3 from that subcontractor.’’.

4 (2) PROHIBITION ON CONTINGENT FEES.—Sec5 tion 304(a) of the Federal Property and Administra6 tive Services Act of 1949 (41 U.S.C. 254(a)), as

7 amended by section 4023(a) is further amended by in8 serting before the period at the end of the sentence

9 added by section 4041 the following: ‘‘or to a contract

10 for the acquisition of commercial items’’.

11 (c) ACQUISITIONS GENERALLY.—

12 (1) FEDERAL WATER POLLUTION CONTROL

13 ACT.—Section 508 of the Federal Water Pollution

14 Control Act (33 U.S.C. 1368) is amended by adding

15 at the end the following new subsection:

16 ‘‘(f)(1) No certification by a contractor, and no con17 tract clause, may be required in the case of a contract for

18 the acquisition of commercial items in order to implement

19 a prohibition or requirement of this section or a prohibition

20 or requirement issued in the implementation of this section.

21 ‘‘(2) In paragraph (1), the term ‘commercial item’ has

22 the meaning given such term in section 4(12) of the Office

23 of Federal Procurement Policy Act (41 U.S.C. 403(12)).’’.

24 (2) CONTRACT WORK HOURS AND SAFETY STAND25 ARDS ACT.—The Contract Work Hours and Safety
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1 Standards Act (title I of the Work Hours and Safety

2 Act of 1962 (40 U.S.C. 327 et seq.)) is amended by

3 adding at the end the following new section:

4 ‘‘SEC. 108. (a) No certification by a contractor, and

5 no contract clause, may be required in the case of a contract

6 for the acquisition of commercial items in order to imple7 ment a prohibition or requirement in this title.

8 ‘‘(b) In subsection (a), the term ‘commercial item’ has

9 the meaning given such term in section 4(12) of the Office

10 of Federal Procurement Policy Act (41 U.S.C. 403(12)).’’.

11 (3) OFFICE OF FEDERAL PROCUREMENT POLICY

12 ACT REQUIREMENT RELATING TO PROCUREMENT IN13 TEGRITY CERTIFICATIONS.—Section 27(e)(7) of the

14 Office of Federal Procurement Policy Act (41 U.S.C.

15 423) is amended by adding at the end the following

16 new subparagraph:

17 ‘‘(C) This subsection does not apply to a contract for

18 the acquisition of commercial items.’’.

19 (4) CERTAIN PROVISIONS OF THE ANTI-KICKBACK

20 ACT OF 1986.—

21 (A) REQUIREMENT FOR CONTRACT

22 CLAUSE.—Section 7 of the Anti-Kickback Act of

23 1986 (41 U.S.C. 57), as amended by section

24 4024(b), is further amended by inserting before

25 the period at the end of subsection (d) the follow-
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1 ing: ‘‘or to a prime contract for the acquisition

2 of commercial items (as defined in section 4(12)

3 of such Act (41 U.S.C. 403(12))).’’.

4 (B) INSPECTION AUTHORITY.—Section 8 of

5 such Act (41 U.S.C. 58) is amended by adding

6 at the end the following: ‘‘This section does not

7 apply with respect to a prime contract for the

8 acquisition of commercial items (as defined in

9 section 4(12) of the Office of Federal Procure10 ment Policy Act (41 U.S.C. 403(12))).’’.

11 (5) DRUG-FREE WORKPLACE ACT OF 1988.—Sec12 tion 5152(a)(1) of the Drug-Free Workplace Act of

13 1988 (subtitle D of title V of Public Law 100–690; 41

14 U.S.C. 701(a)(1)), as amended by section 4024(e), is

15 further amended by inserting after the matter inserted

16 by such section 4024(e) the following: ‘‘, other than a

17 contract for the procurement of commercial items (as

18 defined in section 4(12) of such Act (41 U.S.C.

19 403(12))),’’.

20 (6) CLEAN AIR ACT.—Section 306 of the Clean

21 Air Act (42 U.S.C. 7606) is amended by adding at

22 the end the following new subsection:

23 ‘‘(f)(1) No certification by a contractor, and no con24 tract clause, may be required in the case of a contract for

25 the acquisition of commercial items in order to implement
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1 a prohibition or requirement of this section or a prohibition

2 or requirement issued in the implementation of this section.

3 ‘‘(2) In paragraph (1), the term ‘commercial item’ has

4 the meaning given such term in section 4(12) of the Office

5 of Federal Procurement Policy Act (41 U.S.C. 403(12)).’’.

6 (7) FLY AMERICAN REQUIREMENTS.—Section

7 1117 of the Federal Aviation Act of 1958 (49 U.S.C.

8 App. 1517) is amended by adding at the end the fol9 lowing new subsection:

10 ‘‘(e)(1) No certification by a contractor, and no con11 tract clause, may be required in the case of a contract for

12 the transportation of commercial items in order to imple13 ment a requirement in this section.

14 ‘‘(2) In paragraph (1), the term ‘commercial item’ has

15 the meaning given such term in section 4(12) of the Office

16 of Federal Procurement Policy Act (41 U.S.C. 403(12)).’’.

17 SEC. 8006. FLEXIBLE DEADLINES FOR SUBMISSION OF OF18 FERS OF COMMERCIAL ITEMS.

19 Section 18(a) of the Office of Federal Procurement Pol20 icy Act (41 U.S.C. 416(a)) is amended by adding at the

21 end the following new paragraph:

22 ‘‘(4) The requirements of paragraph (3)(B) do not

23 apply to contracts for the purchase of commercial items.

24 The Administrator shall prescribe for such contracts appro25 priate limits on the applicability of a deadline for submis-
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1 sion of bids or proposals that is required by subsection

2 (a)(1). Such limits shall be incorporated in the Federal Ac3 quisition Regulation.’’.

4 SEC. 8007. ADVOCATES FOR ACQUISITION OF COMMERCIAL

5 AND NONDEVELOPMENTAL ITEMS.

6 (a) RESPONSIBILITIES OF THE ADVOCATE FOR COM7 PETITION.—Section 20(c) of the Office of Federal Procure8 ment Policy Act (41 U.S.C. 418(c)) is amended to read as

9 follows:

10 ‘‘(c) The advocate for competition for each procuring

11 activity shall be responsible for promoting full and open

12 competition, promoting the acquisition of commercial items

13 and other nondevelopmental items, and challenging barriers

14 to such acquisition, including such barriers as unneces15 sarily restrictive statements of need, unnecessarily detailed

16 specifications, and unnecessarily burdensome contract

17 clauses.’’.

18 (b) REPEAL OF SUPERSEDED PROVISION.—Section 28

19 of such Act (41 U.S.C. 424) is repealed.

20 SEC. 8008. PROVISIONS NOT AFFECTED.

21 Nothing in this title shall be construed as amending,

22 modifying, or superseding, or as intended to impair or re23 strict authorities or responsibilities under—

24 (1) section 111 of the Federal Property and Ad25 ministrative Services Act of 1949 (40 U.S.C. 759),
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1 popularly referred to as the ‘‘Brooks Automatic Data

2 Processing Act’’;

3 (2) title IX of the Federal Property and Admin4 istrative Services Act of 1949 (40 U.S.C. 541 et seq.),

5 popularly referred to as the ‘‘Brooks Architect-Engi6 neers Act’’;

7 (3) section 8(a) of the Small Business Act (15

8 U.S.C. 637(a)) or any other provision of that Act; or

9 (4) the Act of June 25, 1938 (41 U.S.C. 46–48c),

10 that was revised and reenacted in the Act of June 23,

11 1971 (85 Stat. 77), popularly referred to as the ‘‘Jav12 its-Wagner-O’Day Act’’.

13 SEC. 8009. COMPTROLLER GENERAL REVIEW OF FEDERAL

14 GOVERNMENT USE OF MARKET RESEARCH.

15 (a) REPORT REQUIRED.—Not later than 2 years after

16 the date of the enactment of this Act, the Comptroller Gen17 eral of the United States shall submit to the Congress a

18 report on the use of market research by the Federal Govern19 ment in support of the procurement of commercial items

20 and nondevelopmental items.

21 (b) CONTENT OF REPORT.—The report shall include

22 the following:

23 (1) A review of existing Federal Government

24 market research efforts to gather data concerning

25 commercial and other nondevelopmental items.
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1 (2) A review of the feasibility of creating a Gov2 ernment-wide data base for storing, retrieving, and

3 analyzing market data, including use of existing Fed4 eral Government resources.

5 (3) Any recommendations for changes in law or

6 regulations that the Comptroller General considers

7 appropriate.

8 TITLE IX—EFFECTIVE DATES

9 AND IMPLEMENTATION

10 SEC. 9001. EFFECTIVE DATES.

11 (a) EFFECTIVE DATE OF ACT.—Except as otherwise

12 provided in this Act, this Act shall take effect on the date

13 of the enactment of this Act.

14 (b) EFFECTIVE DATE OF AMENDMENTS.—Except as

15 otherwise provided in this Act, the amendments made by

16 this Act shall take effect on the date on which final imple17 menting regulations are prescribed in accordance with sec18 tion 9002.

19 SEC. 9002. IMPLEMENTING REGULATIONS.

20 (a) PROPOSED CHANGES.—Proposed changes to the

21 Federal Acquisition Regulation and such other proposed

22 regulations (or changes to existing regulations) as may be

23 necessary to implement this Act shall be published in the

24 Federal Register not later than 210 days after the date of

25 the enactment of this Act.
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1 (b) PUBLIC COMMENT.—The proposed regulations de2 scribed in subsection (a) shall be made available for public

3 comment for a period of not less than 60 days.

4 (c) FINAL REGULATIONS.—Final regulations shall be

5 published in the Federal Register not later than 330 days

6 after the date of enactment of this Act.

7 (d) APPLICABILITY.—(1) The amendments made by

8 this Act shall apply, in the manner prescribed in such final

9 regulations, to any solicitation that is issued or any unso10 licited proposal that is received on or after the date de11 scribed in paragraph (3).

12 (2) The amendments made by this Act shall apply, to

13 the extent and in the manner prescribed in such final regu14 lations, to any matter related to—

15 (A) a contract that is in effect on the date de16 scribed in paragraph (3);

17 (B) an offer under consideration on the date de18 scribed in paragraph (3); or

19 (C) any other proceeding or action that is ongo20 ing on the date described in paragraph (3).

21 (3) The date referred to in paragraphs (1) and (2) is

22 the date specified in such regulations, which—

23 (A) shall not be earlier than the end of the 30-

24 day period that begins on the date the regulations re25 quired by subsection (c) are published; and
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1 (B) shall not be later than October 1, 1995.

2 (e) SAVINGS PROVISION.—Nothing in this Act shall be

3 construed to affect the validity of any action taken or any

4 contract entered into prior to the date specified in the regu5 lations pursuant to subsection (d)(3) except to the extent

6 and in the manner prescribed in such regulations.

7 SEC. 9003. EVALUATION BY THE COMPTROLLER GENERAL.

8 (a) EVALUATION RELATING TO ISSUANCE OF REGULA9 TIONS.—Not later than December 1, 1995, the Comptroller

10 General shall submit to the committees referred to in sub11 section (c) a report evaluating compliance with the require12 ments in section 9002, relating to the issuance of imple13 menting regulations.

14 (b) EVALUATION OF IMPLEMENTATION OF REGULA15 TIONS.—Not later than December 1, 1996, the Comptroller

16 General shall submit to the committees referred to in sub17 section (c) a report evaluating the effectiveness of the regula18 tions implementing this Act in streamlining the acquisition

19 system and fulfilling the other purposes of this Act.

20 (c) COMMITTEES DESIGNATED TO RECEIVE THE RE21 PORTS.—The Comptroller General shall submit the reports

22 required by this section to the Committees on Armed Serv23 ices and on Governmental Affairs of the Senate and the

24 Committees on Small Business on Government Operations

25 of the House of Representatives.
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1 SEC. 9004. DATA COLLECTION THROUGH THE FEDERAL

2 PROCUREMENT DATA SYSTEM.

3 (a) DATA COLLECTION REQUIRED.—The Federal Pro4 curement Data System described in section 6(d)(4)(A) of

5 the Office of Federal Procurement Policy Act (41 U.S.C.

6 405(d)(4)(A)) shall be modified to collect from contracts in

7 excess of the simplified acquisition threshold data pertain8 ing to the following matters:

9 (1) Contract awards made pursuant to competi10 tions conducted pursuant to section 2323 of title 10,

11 United States Code, or section 8(c) of the Small Busi12 ness Act (15 U.S.C. 637(c)).

13 (2) Awards to business concerns owned and con14 trolled by women.

15 (3) Number of offers received in response to a so16 licitation.

17 (4) Task order contracts.

18 (5) Contracts for the acquisition of commercial

19 items.

20 (b) DEFINITION.—In this section, the term ‘‘simplified

21 acquisition threshold’’ has the meaning given such term in

22 section 4 of the Office of Federal Procurement Policy Act

23 (41 U.S.C. 403).

S 1587 RS——2

S 1587 RS——3

S 1587 RS——4
305

•S 1587 RS

S 1587 RS——5

S 1587 RS——6

S 1587 RS——7

S 1587 RS——8

S 1587 RS——9

S 1587 RS——10

S 1587 RS——11

S 1587 RS——12

S 1587 RS——13

S 1587 RS——14

S 1587 RS——15

S 1587 RS——16

S 1587 RS——17

S 1587 RS——18

S 1587 RS——19