103D CONGRESS

2D SESSION S. 1587

AN ACT

To revise and streamline the acquisition laws of the

Federal Government and for other purposes.
103D CONGRESS

2D SESSION S. 1587

AN ACT

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’’.
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1 SEC. 2. TABLE OF CONTENTS.

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

Sec. 1. Short title.

Sec. 2. Table of contents.

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.

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.
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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.

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.
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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.

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
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Sec. 2191. Travel expenses of government contractors.

Sec. 2192. Unallowability of entertainment costs under covered contracts.

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.

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.

Sec. 2555. Authority for District Courts to obtain advisory opinions from

boards of contract appeals in certain cases.

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.
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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. 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.

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.
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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. Acquisitions generally.

Sec. 4102. Acquisitions from small businesses.

Sec. 4103. Contracting program for certain small business concerns.

Sec. 4104. Procurement goals for small business concerns owned by women.

Sec. 4105. Development of definitions regarding certain small business concerns.

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.
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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.

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—MISCELLANEOUS PROVISIONS

Sec. 9001. Comptroller General review of the provision of legal advice for inspectors general.
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Sec. 9002. Cost savings for official travel.

Sec. 9003. Prompt resolution of audit recommendations.

Sec. 9004. Uniform suspension and debarment.

TITLE X—EFFECTIVE DATES AND IMPLEMENTATION

Sec. 10001. Effective dates.

Sec. 10002. Implementing regulations.

Sec. 10003. Evaluation by the Comptroller General.

Sec. 10004. Data collection through the Federal procurement data system.

TITLE IX—WAIVER OF THE APPLICATION OF THE PREVAILING WAGE-SETTING REQUIREMENTS TO VOLUNTEERS

Sec. 11001. Short title.

Sec. 11002. Purpose.

Sec. 11003. Waiver.

Sec. 11004. Report.

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

8 amended—

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 ‘‘regu14 lations modified’’ and all that follows through

15 ‘‘note)’’ and inserting in lieu thereof ‘‘Federal Ac16 quisition 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

9 of subparagraph (C) and inserting in lieu there10 of a 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 serv15 ice;

16 ‘‘(E) would satisfy projected needs for such

17 property or service determined on the basis of a his18 tory of high demand for the property or service; or

19 ‘‘(F) in the case of medical supplies, safety sup20 plies, or emergency supplies, would satisfy a critical

21 need for such supplies.’’;

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

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

24 (3) by inserting after paragraph (1) the follow25 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

20 section 2304 the following new section:

21 ‘‘§ 2304a. Task order contracts for advisory and as22 sistance services

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

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

2 (other than a minimum or maximum quantity) and that

3 provides for the issuance of task orders during the speci4 fied period of the contract.

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

6 of 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 pe9 riod of a contract referred to in subsection (a), including

10 all periods of extensions of the contract under options,

11 modifications, or otherwise, may not exceed 5 years unless

12 a longer period is specifically authorized in a law that is

13 applicable 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

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

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

19 procedures is approved in accordance with subsection (f)

20 of such section.

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

22 of Federal Procurement Policy Act (41 U.S.C. 416) and

23 section 8(e) of the Small Business Act (15 U.S.C. 637(e))

24 shall reasonably and fairly describe the general scope,

25 magnitude, and duration of the proposed contract in a
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1 manner that would reasonably enable a potential offeror

2 to decide whether to request the solicitation and consider

3 submitting an 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

12 other description that reasonably describes the gen13 eral scope, nature, complexity, and purposes of the

14 services 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 sec17 tion for the same or similar services to two or more

18 sources if the solicitation states that the head of the agen19 cy has the option to do so.

20 ‘‘(B) If, in the case of a contract for advisory and

21 assistance services to be entered into under the authority

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

23 and the contract amount is estimated to exceed

24 $10,000,000 (including all options), the solicitation

25 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

9 of a solicitation for which the head of an agency deter10 mines in writing that, because the services required under

11 the contract are unique or highly specialized, it is not

12 practicable to award more than one contract.

13 ‘‘(5) A contract referred to in subsection (a) shall

14 contain the same information that is required by para15 graph (3) to be included in the solicitation of offers for

16 that contract.

17 ‘‘(d) ORDER PROCEDURES.—(1) The following ac18 tions are not required for a task order issued under a con19 tract entered into in accordance with this section:

20 ‘‘(A) A separate notice for such order under

21 section 18 of the Office of Federal Procurement Pol22 icy Act (41 U.S.C. 416) or section 8(e) of the Small

23 Business 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 con3 tract.

4 ‘‘(2)(A) When multiple contracts are awarded pursu5 ant to subsection (c)(4), all contractors awarded such con6 tracts shall be provided a fair opportunity to be consid7 ered, pursuant to procedures set forth in the contracts,

8 for each task order in excess of $2,500 that is to be issued

9 under any of the contracts unless—

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

11 is of such unusual urgency that competition would

12 result in unacceptable delays in fulfilling the agen13 cy’s needs;

14 ‘‘(ii) only one such contractor is capable of pro15 viding the services required at the level of quality re16 quired because the services ordered are unique or so

17 highly specialized;

18 ‘‘(iii) the task order should be issued on a sole19 source basis in the interest of economy and effi20 ciency because it is a logical follow-on to a task

21 order already issued on a competitive basis; or

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

23 contractor in order to satisfy a minimum guarantee.

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

25 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

4 the issuance or proposed issuance of a task order except

5 for a protest on the ground that the order increases the

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

7 which the 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 modifica13 tion 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 Fed21 eral Procurement Policy Act (41 U.S.C. 416) and section

22 8(e) of the Small Business Act (15 U.S.C. 637(e)).

23 ‘‘(4)(A) Notwithstanding the limitation on the con24 tract period set forth in subsection (b) or in a solicitation

25 or contract pursuant to subsection (c), a contract entered
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1 into by the head of an agency under this section may be

2 extended on a sole-source basis for a period not exceeding

3 6 months 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 en7 tered into; and

8 ‘‘(ii) the extension is necessary in order to en9 sure 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

14 with 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

21 be considered for task orders when required under sub22 section (d)(2). The task order ombudsman shall be a sen23 ior agency official who is independent of the contracting

24 officer for the contracts and may be the agency’s competi25 tion advocate.
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1 ‘‘(g) INAPPLICABILITY TO CERTAIN CONTRACTS.—

2 This section does not apply to a contract for the acquisi3 tion of property or services that includes acquisition of ad4 visory and assistance services if the head of an agency en5 tering into such contract determines that, under the con6 tract, advisory and assistance services are necessarily inci7 dent to, and 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 mul12 tiple delivery order contracts, for property or services

13 (other than advisory and assistance services) under other

14 provisions of this chapter or under any other provision of

15 law.

16 ‘‘(i) ADVISORY AND ASSISTANCE SERVICES DE17 FINED.—In this section, the term ‘advisory and assistance

18 services’ has the meaning given such term in section

19 1105(g) of title 31.’’.

20 (2) CLERICAL AMENDMENT.—The table of sec21 tions at the beginning of such chapter is amended

22 by inserting after the item relating to section 2304

23 the following new item:

‘‘2304a. Task order contracts for advisory and assistance services.’’.
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1 (b) REPEAL OF SUPERSEDED PROVISION.—Section

2 2304 of title 10, United States Code, is amended by strik3 ing out subsection (j).

4 (c) CONFORMING AMENDMENT FOR PROFESSIONAL

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

6 United States Code, is amended by striking out subsection

7 (c).

8 SEC. 1005. ACQUISITION OF EXPERT SERVICES.

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

10 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’’.
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1 Subpart B—Planning, Solicitation, Evaluation, and

2 Award

3 SEC. 1011. SOURCE SELECTION FACTORS.

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

5 amended—

6 (1) in paragraph (2)—

7 (A) in subparagraph (A)(i), by striking out

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

9 thereof ‘‘nonprice-related factors and

10 subfactors)’’; and

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

12 out subclause (I) and inserting in lieu thereof

13 the following:

14 ‘‘(I) either a statement that the pro15 posals are intended to be evaluated with,

16 and award made after, discussions with the

17 offerors, or a statement that the proposals

18 are intended to be evaluated, and award

19 made, without discussions with the offerors

20 (other than discussions conducted for the

21 purpose of minor clarification) unless dis22 cussions are determined to be necessary;

23 and’’; and

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

25 in lieu thereof the following:
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1 ‘‘(3)(A) In prescribing the evaluation factors to be

2 included in each solicitation for competitive proposals, the

3 head of an agency—

4 ‘‘(i) shall clearly establish the relative impor5 tance assigned to the evaluation factors and

6 subfactors, including the quality of the product or

7 services to be provided (including technical capabil8 ity, management capability, prior experience, and

9 past performance of the offeror);

10 ‘‘(ii) shall include cost or price to the Govern11 ment as an evaluation factor that must be consid12 ered in the evaluation of proposals; and

13 ‘‘(iii) shall disclose to offerors whether all eval14 uation factors other than cost or price, when com15 bined, are—

16 ‘‘(I) significantly more important than cost

17 or price;

18 ‘‘(II) approximately equal in importance to

19 cost or price; or

20 ‘‘(III) significantly less important than

21 cost or price.

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

23 from—
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1 ‘‘(i) providing additional information in a solici2 tation, including numeric weights for all evaluation

3 factors; or

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

5 made to the offeror that meets the solicitation’s

6 mandatory requirements at the lowest cost or

7 price.’’.

8 SEC. 1012. SOLICITATION PROVISION REGARDING EVALUA9 TION OF PURCHASE OPTIONS.

10 (a) OPTIONS FOR ADDITIONAL PURCHASES.—Sub11 section (a) of section 2305 of title 10, United States Code,

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

13 at the end the following new paragraph:

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

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

16 may not include in such solicitation a clause providing for

17 the evaluation of prices for options to purchase additional

18 property or services under the contract unless the head

19 of the agency has determined that there is a reasonable

20 likelihood that the options will be exercised.’’.

21 (b) REPEAL OF SUPERSEDED PROVISION.—Section

22 2301(a) of such title is amended—

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

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

25 (5); and
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1 (3) by striking out ‘‘; and’’ at the end of para2 graph (6) and inserting in lieu thereof a period.

3 SEC. 1013. PROMPT NOTICE OF AWARD.

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

5 of title 10, United States Code, is amended by adding at

6 the end the following: ‘‘As soon as practicable after the

7 date of contract award, the head of the agency shall, in

8 accordance with procedures prescribed in the Federal Ac9 quisition Regulation, notify all offerors not awarded the

10 contract that the contract has been awarded.’’.

11 (b) COMPETITIVE PROPOSALS PROCEDURES.—Sec12 tion 2305(b)(4)(B) of title 10, United States Code, is

13 amended in the second sentence by striking out ‘‘source

14 and shall promptly notify’’ and inserting in lieu thereof

15 ‘‘source. As soon as practicable after the date of contract

16 award, the head of the agency shall, in accordance with

17 procedures prescribed in the Federal Acquisition Regula18 tion, notify’’.

19 SEC. 1014. POST-AWARD DEBRIEFINGS.

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

21 amended—

22 (1) by redesignating paragraph (5) as para23 graph (6); and

24 (2) by inserting after paragraph (4) the follow25 ing new paragraph (5):
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1 ‘‘(5)(A) When a contract is awarded by the head of

2 an agency on the basis of competitive proposals, an unsuc3 cessful offeror, upon written request received by the agen4 cy within 3 days after the date on which the unsuccessful

5 offeror receives the notification of the contract award,

6 shall be debriefed and furnished the basis for the selection

7 decision and contract award. An employee of the agency

8 shall debrief the offeror promptly after receipt of the re9 quest by the agency.

10 ‘‘(B) The debriefing shall include, at a minimum—

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

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

13 ‘‘(ii) the overall evaluated cost and technical

14 rating of the offer of the contractor awarded the

15 contract and the overall evaluated cost and technical

16 rating of the offer of the debriefed offeror;

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

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

19 ‘‘(v) in the case of a proposal for a commercial

20 item other than a commercial component, the make

21 and model of the item being provided in accordance

22 with the offer of the contractor awarded the con23 tract; and

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

25 the debriefed offeror as to whether source selection
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1 procedures set forth in the solicitation, applicable

2 regulations, and other applicable authorities were

3 followed by the agency.

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

5 comparisons of the debriefed offeror’s offer with other of6 fers and may not disclose any information that is exempt

7 from disclosure under section 552 of title 5, including in8 formation relating to—

9 ‘‘(i) trade secrets;

10 ‘‘(ii) privileged or confidential manufacturing

11 processes and techniques; and

12 ‘‘(iii) commercial and financial information that

13 is privileged or confidential, including cost break14 downs, profit, indirect cost rates, and similar infor15 mation.

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

17 include a statement that information described in subpara18 graph (B) may be disclosed in post-award debriefings.

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

20 award and as a result of a successful procurement protest

21 or otherwise, the agency seeks to fulfill the requirement

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

23 of offers or on the basis of new best and final offers re24 quested for that contract, the agency shall make available

25 to all offerors—
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1 ‘‘(i) the information provided in debriefings

2 under this paragraph regarding the offer of the con3 tractor awarded the contract; and

4 ‘‘(ii) the same information that would have been

5 provided to the original offerors.

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

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

8 SEC. 1015. PROTEST FILE.

9 Section 2305 of title 10, United States Code, is

10 amended by adding at the end the following:

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

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

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

14 the procedures in subchapter V of chapter 35 of title 31

15 and an actual or prospective offeror so requests, a file of

16 the protest shall be established by the procuring activity

17 and reasonable access shall be provided to actual or pro18 spective offerors.

19 ‘‘(2) Information exempt from disclosure under the

20 section 552 of title 5 may be redacted in a file established

21 pursuant to paragraph (1) unless an applicable protective

22 order provides otherwise.

23 ‘‘(3) Regulations implementing this subsection shall

24 be consistent with the regulations regarding the prepara25 tion and submission of an agency’s protest file (the so-
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1 called ‘rule 4 file’) for protests to the General Services

2 Board of Contract Appeals under section 111 of the Fed3 eral Property and Administrative Services Act of 1949 (41

4 U.S.C. 759).’’.

5 SEC. 1016. AWARD OF COSTS AND FEES IN AGENCY SETTLE6 MENT OF PROTESTS.

7 Section 2305 of title 10, United States Code, as

8 amended by section 1015, is further amended by adding

9 at the end the following new subsection:

10 ‘‘(f) If, in connection with a protest, the head of an

11 agency determines that a solicitation, proposed award, or

12 award does not comply with the requirements of law or

13 regulation, the head of the agency may take—

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

15 through (F) of subsection (b)(1) of section 3554 of

16 title 31; and

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

18 of section 3554(c) of title 31 within the limits re19 ferred to in paragraph (2) of such section.’’.

20 SEC. 1017. TWO-PHASE SELECTION PROCEDURES.

21 (a) PROCEDURES AUTHORIZED.—Chapter 137 of

22 title 10, United States Code, is amended by inserting after

23 section 2305 the following new section:
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1 ‘‘§ 2305a. Two-phase selection procedures

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

3 agency may use two-phase selection procedures for enter4 ing into a contract for the acquisition of property or serv5 ices (other than a construction contract) when the head

6 of the agency determines that three or more offers will

7 be received for such contract, substantial design work

8 must be performed before an offeror can develop a price

9 or cost proposal for such contract, and the offerors will

10 incur a substantial amount of expenses in preparing the

11 offers.

12 ‘‘(b) PROCEDURES DESCRIBED.—Two-phase selec13 tion procedures consist of the following:

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

15 that—

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

17 ‘‘(i) technical approach; and

18 ‘‘(ii) technical qualifications; and

19 ‘‘(B) do not include—

20 ‘‘(i) detailed design information; or

21 ‘‘(ii) cost or price information.

22 ‘‘(2) The head of the agency evaluates the pro23 posals on the basis of evaluation criteria set forth in

24 the solicitation, except that the head of the agency

25 does not consider cost-related or price-related eval26 uation factors.
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1 ‘‘(3) The head of the agency selects at least

2 three offerors as the most highly qualified to provide

3 the property or services under the contract and re4 quests the selected offerors to submit competitive

5 proposals that include cost or price information.

6 ‘‘(4) The head of the agency awards the con7 tract in accordance with section 2305(b)(4) of this

8 title.

9 ‘‘(c) SOLICITATION TO STATE NUMBER OF

10 OFFERORS TO BE SELECTED FOR PHASE TWO RE11 QUESTS FOR COMPETITIVE PROPOSALS.—A solicitation

12 issued pursuant to subsection (b)(1) shall state the maxi13 mum number of offerors that are to be selected to submit

14 competitive proposals pursuant to subsection (b)(3).

15 ‘‘(d) RESOURCE COMPARISON CRITERION RE16 QUIRED.—In using two-phase selection procedures for en17 tering into a contract, the head of the agency shall estab18 lish a resource criterion or a financial criterion applicable

19 to the contract in order to provide a consistent basis for

20 comparing the offerors and their proposals.’’.

21 (b) CLERICAL AMENDMENT.—The table of sections

22 at the beginning of such chapter is amended by inserting

23 after the item relating to section 2305 the following:

‘‘2305a. Two-phase selection procedures.’’.
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1 Subpart C—Kinds of Contracts

2 SEC. 1021. SECRETARIAL DETERMINATION REGARDING

3 USE OF COST TYPE OR INCENTIVE CON4 TRACT.

5 Subsection (c) of section 2306 of title 10, United

6 States Code, is repealed.

7 SEC. 1022. TECHNICAL AND CONFORMING AMENDMENTS.

8 (a) REPEAL OF UNNECESSARY CROSS REF9 ERENCE.—Subsection (f) of section 2306 of title 10, Unit10 ed States Code, is repealed.

11 (b) CONFORMING AMENDMENT.—Such section is

12 amended by redesignating subsections (d), (e), (g), and

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

14 (c) NEUTERIZATION OF REFERENCE.—Subsection

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

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

17 ‘‘whenever he finds’’ and inserting in lieu thereof ‘‘when18 ever the head of the agency finds’’.

19 Subpart D—Miscellaneous Provisions for the

20 Encouragement of Competition

21 SEC. 1031. REPEAL OF REQUIREMENT FOR ANNUAL RE22 PORT BY ADVOCATES FOR COMPETITION.

23 Subsection (c) of section 2318 of title 10, United

24 States Code, is repealed.
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1 PART II—CIVILIAN AGENCY ACQUISITIONS

2 Subpart A—Competition Requirements

3 SEC. 1051. REFERENCES TO FEDERAL ACQUISITION REGU4 LATION.

5 Section 303 of the Federal Property and Administra6 tive Services Act of 1949 (41 U.S.C. 253) is amended—

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

8 ‘‘modifications’’ and all that follows through ‘‘of

9 1984’’ and inserting in lieu thereof ‘‘Federal Acqui10 sition Regulation’’; and

11 (2) in subsection (g)(1), by striking out ‘‘regu12 lations modified’’ and all that follows through ‘‘of

13 1984,’’ and inserting in lieu thereof ‘‘Federal Acqui14 sition Regulation’’.

15 SEC. 1052. ESTABLISHMENT OR MAINTENANCE OF ALTER16 NATIVE SOURCES OF SUPPLY.

17 Section 303(b) of the Federal Property and Adminis18 trative Services Act of 1949 (41 U.S.C. 253(b)) is amend19 ed—

20 (1) in paragraph (1)—

21 (A) by striking out ‘‘or’’ at the end of sub22 paragraph (B);

23 (B) by striking out the period at the end

24 of subparagraph (C) and inserting in lieu there25 of a semicolon; and
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1 (C) by adding at the end the following new

2 subparagraphs:

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

4 a reliable source of supply of such property or serv5 ice;

6 ‘‘(E) would satisfy projected needs for such

7 property or service determined on the basis of a his8 tory of high demand for the property or service; or

9 ‘‘(F) in the case of medical supplies, safety sup10 plies, or emergency supplies, would satisfy a critical

11 need for such supplies.’’;

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

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

14 (3) by inserting after paragraph (1) the follow15 ing new paragraph (2):

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

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

18 or contracts.’’; and

19 (4) in paragraph (4), as redesignated by para20 graph (2), by striking out ‘‘paragraphs (1) and (2)’’

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

22 (3)’’.
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1 SEC. 1053. CLARIFICATION OF APPROVAL AUTHORITY FOR

2 USE OF PROCEDURES OTHER THAN FULL

3 AND OPEN COMPETITION.

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

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

6 253(f)(1)(B)(i)) is amended by inserting before the semi7 colon at the end the following: ‘‘or by an official referred

8 to in clause (ii), (iii), or (iv)’’.

9 SEC. 1054. TASK ORDER CONTRACTS FOR ADVISORY AND

10 ASSISTANCE SERVICES.

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

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

13 et seq.) is amended by inserting after section 303G the

14 following new section:

15 ‘‘TASK ORDER CONTRACTS FOR ADVISORY AND

16 ASSISTANCE SERVICES

17 ‘‘SEC. 303H. (a) AUTHORITY TO AWARD.—(1) Sub18 ject to the requirements of this section, the head of an

19 executive agency may enter into a contract for advisory

20 and assistance services that does not procure or specify

21 a firm quantity of services (other than a minimum or max22 imum quantity) and that provides for the issuance of task

23 orders during the specified period of the contract.

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

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

26 only under the authority of this section.
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1 ‘‘(b) LIMITATION ON CONTRACT PERIOD.—The pe2 riod of a contract referred to in subsection (a), including

3 all periods of extensions of the contract under options,

4 modifications, or otherwise, may not exceed 5 years unless

5 a longer period is specifically authorized in a law that is

6 applicable to such contract.

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

8 may use procedures other than competitive procedures to

9 enter into a contract referred to in subsection (a) only if

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

11 the contract and the use of such procedures is approved

12 in accordance with subsection (f) of such section.

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

14 of Federal Procurement Policy Act (41 U.S.C. 416) and

15 section 8(e) of the Small Business Act (15 U.S.C. 637(e))

16 shall reasonably and fairly describe the general scope,

17 magnitude, and duration of the proposed contract in a

18 manner that would reasonably enable a potential offeror

19 to decide whether to request the solicitation and consider

20 submitting an offer.

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

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

23 number of options to extend the contract and the pe24 riod for which the contract may be extended under

25 each option, if any.
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1 ‘‘(B) The maximum quantity or dollar value of

2 the services to be procured under the contract.

3 ‘‘(C) A statement of work, specifications, or

4 other description that reasonably describes the gen5 eral scope, nature, complexity, and purposes of the

6 services to be procured under the contract.

7 ‘‘(4)(A) An agency head may, on the basis of one so8 licitation, award separate contracts under this section for

9 the same or similar services to two or more sources if the

10 solicitation states that the agency head has the option to

11 do so.

12 ‘‘(B) If, in the case of a contract for advisory and

13 assistance services to be entered into under the authority

14 of this section, the contract period is to exceed 3 years

15 and the contract amount is estimated to exceed

16 $10,000,000 (including all options), the solicitation

17 shall—

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

19 under subparagraph (A); and

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

21 may also elect to award only one contract if the

22 agency head determines in writing that only one of

23 the offerers is capable of providing the services re24 quired at the level of quality required.
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1 ‘‘(C) Subparagraph (B) does not apply in the case

2 of a solicitation for which the agency head determines in

3 writing that, because the services required under the con4 tract are unique or highly specialized, it is not practicable

5 to award more than one contract.

6 ‘‘(5) A contract referred to in subsection (a) shall

7 contain the same information that is required by para8 graph (3) to be included in the solicitation of offers for

9 that contract.

10 ‘‘(d) ORDER PROCEDURES.—(1) The following ac11 tions are not required for a task order issued under a con12 tract entered into in accordance with this section:

13 ‘‘(A) A separate notice for such order under

14 section 18 of the Office of Federal Procurement Pol15 icy Act (41 U.S.C. 416) or section 8(e) of the Small

16 Business Act (15 U.S.C. 637(e)).

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

18 competition (or a waiver of competition approved in

19 accordance with section 303(f)) that is separate

20 from that used for entering into the contract.

21 ‘‘(2)(A) When multiple contracts are awarded pursu22 ant to subsection (c)(4), all contractors awarded such con23 tracts shall be provided a fair opportunity to be consid24 ered, pursuant to procedures set forth in the contracts,
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1 for each task order in excess of $2,500 that is to be issued

2 under any of the contracts unless—

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

4 is of such unusual urgency that competition would

5 result in unacceptable delays in fulfilling the agen6 cy’s needs;

7 ‘‘(ii) only one such contractor is capable of pro8 viding the services required at the level of quality re9 quired because the services ordered are unique or

10 highly specialized;

11 ‘‘(iii) the task order should be issued on a sole12 source basis in the interest of economy and effi13 ciency because it is a logical follow-on to a task

14 order already issued on a competitive basis; or

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

16 contractor in order to satisfy a minimum guarantee.

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

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

19 work that clearly specifies all tasks to be performed under

20 the order.

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

22 the issuance or proposed issuance of a task order except

23 for a protest on the ground that the order increases the

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

25 which the order is issued.
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1 ‘‘(e) INCREASES IN SCOPE, PERIOD, OR MAXIMUM

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

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

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

5 value of the contract may be increased only by modifica6 tion of the contract.

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

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

9 of section 303 and approved in accordance with subsection

10 (f) of such section, competitive procedures shall be used

11 for making such a modification.

12 ‘‘(3) Notice regarding the modification shall be pro13 vided in accordance with section 18 of the Office of Fed14 eral Procurement Policy Act (41 U.S.C. 416) and section

15 8(e) of the Small Business Act (15 U.S.C. 637(e)).

16 ‘‘(4)(A) Notwithstanding the limitation on the con17 tract period set forth in subsection (b) or in a solicitation

18 or contract pursuant to subsection (c), a contract entered

19 into by the head of an agency under this section may be

20 extended on a sole-source basis for a period not exceeding

21 6 months if the agency head determines that—

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

23 delayed by circumstances that were not reasonably

24 foreseeable at the time the initial contract was en25 tered into; and
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1 ‘‘(ii) the extension is necessary in order to en2 sure continuity of the receipt of services pending the

3 award of, and commencement of performance under,

4 the follow-on contract.

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

6 of subparagraph (A) only once and only in accordance

7 with the limitations and requirements of this subsection.

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

9 who awards multiple contracts pursuant to subsection

10 (c)(4) shall appoint or designate a task order ombudsman

11 who shall be responsible for reviewing complaints from the

12 contractors on such contracts and ensuring that all of the

13 contractors are afforded a fair opportunity to be consid14 ered for task orders when required under subsection

15 (d)(2). The task order ombudsman shall be a senior agen16 cy official who is independent of the contracting officer

17 for the contracts and may be the agency’s competition ad18 vocate.

19 ‘‘(g) INAPPLICABILITY TO CERTAIN CONTRACTS.—

20 This section does not apply to a contract for the acquisi21 tion of property or services that includes acquisition of ad22 visory and assistance services if the agency head entering

23 into such contract determines that, under the contract, ad24 visory and assistance services are necessarily incident to,

25 and not a significant component of, the contract.
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1 ‘‘(h) RELATIONSHIP TO OTHER CONTRACTING AU2 THORITY.—Nothing in this section may be construed to

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

4 single or multiple task order contracts, or single or mul5 tiple delivery order contracts, for goods or services (other

6 than advisory and assistance services) under other provi7 sions of this title or under any other provision of law.

8 ‘‘(i) ADVISORY AND ASSISTANCE SERVICES DE9 FINED.—In this section, the term ‘advisory and assistance

10 services’ has the meaning given such term in section

11 1105(g) of title 31, United States Code.’’.

12 (b) CLERICAL AMENDMENT.—The table of contents

13 in the first section is amended by inserting after the item

14 relating to section 303G the following new item:

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

15 SEC. 1055. ACQUISITION OF EXPERT SERVICES.

16 (a) EXCEPTION TO REQUIREMENT FOR USE OF COM17 PETITIVE PROCEDURES.—Section 303(c)(3) of the Fed18 eral Property and Administrative Services Act of 1949 (41

19 U.S.C. 253(c)) is amended—

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

21 lieu thereof ‘‘(B)’’; and

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

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

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

25 any reasonably foreseeable litigation or dispute) in-
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1 volving the Federal Government, in any trial, hear2 ing, or proceeding before any court, administrative

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

4 dispute resolution process, whether or not the expert

5 is expected to testify’’.

6 (b) PROCUREMENT NOTICE.—

7 (1) AMENDMENT OF OFFICE OF FEDERAL PRO8 CUREMENT POLICY ACT.—Section 18(c) of the Office

9 of Federal Procurement Policy Act (41 U.S.C.

10 416(c)) is amended—

11 (A) by striking out ‘‘or’’ at the end of sub12 paragraph (D);

13 (B) by striking out the period at the end

14 of subparagraph (E) and inserting in lieu there15 of ‘‘; or’’; and

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

17 ‘‘(F) the procurement is for the services of an

18 expert for use in any litigation or dispute (including

19 any reasonably foreseeable litigation or dispute) in20 volving the Federal Government in any trial, hear21 ing, or proceeding before any court, administrative

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

23 dispute resolution process, whether or not the expert

24 is expected to testify.’’.
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1 (2) AMENDMENT OF SMALL BUSINESS ACT.—

2 Section 8(g) of the Small Business Act (15 U.S.C.

3 637(c)) is amended—

4 (A) by striking out ‘‘or’’ at the end of sub5 paragraph (D);

6 (B) by striking out the period at the end

7 of subparagraph (E) and inserting in lieu there8 of ‘‘; or’’; and

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

10 ‘‘(F) the procurement is for the services of an

11 expert for use in any litigation or dispute (including

12 preparation for any foreseeable litigation or dispute)

13 that involves or could involve the Federal Govern14 ment in any trial, hearing, or proceeding before any

15 court, administrative tribunal, or agency, or in any

16 part of an alternative dispute resolution process,

17 whether or not the expert is expected to testify.’’.

18 (c) REPEAL OF AMENDMENTS TO UNCODIFIED

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

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

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

22 quotes in that section.

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

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

25 that section.
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1 SEC. 1056. CONTINUED OCCUPANCY OF LEASED SPACE.

2 Section 303(d) of the Federal Property and Adminis3 trative Services Act of 1949 (41 U.S.C. 253(d)) is amend4 ed—

5 (1) by redesignating paragraph (2) as para6 graph (3); and

7 (2) by inserting after paragraph (1) the follow8 ing new paragraph (2):

9 ‘‘(2)(A) For the purposes of applying subsection

10 (c)(1) in the case of a follow-on lease to be entered into

11 for the purpose of providing for continued occupancy of

12 particular space in leased real property by a Federal agen13 cy, space may be treated as being available only from the

14 lessor of such space and may be acquired through the use

15 of procedures other than competitive procedures (without

16 the justification otherwise required by subsection (f)) if

17 a written determination is made by the contracting officer

18 that—

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

20 for the space;

21 ‘‘(ii) the space meets the needs of the agency;

22 and

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

24 the space at a fair market price determined by the

25 contracting officer on the basis of a market survey
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1 or an appraisal conducted in accordance with gen2 erally accepted real property appraisal standards.

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

4 procedures other than competitive procedures to enter into

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

6 provide for continued occupancy of particular space in real

7 property by a particular Federal agency. The period of

8 such follow-on lease may not exceed 5 years.

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

10 prohibit the use of procedures other than competitive pro11 cedures to enter into a follow-on lease of real property for

12 continued occupancy of particular space in real property

13 by a Federal agency when an exception set forth in sub14 section (c) applies and the use of such procedures is justi15 fied and approved in accordance with subsection (f).’’.

16 Subpart B—Planning, Solicitation, Evaluation, and

17 Award

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

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

20 the Federal Property and Administrative Services Act of

21 1949 (41 U.S.C. 253a) is amended—

22 (1) in subsection (b)(1)(A)—

23 (A) by inserting ‘‘and significant

24 subfactors’’ after ‘‘all significant factors’’; and
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1 (B) by striking out ‘‘(including price)’’ and

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

3 or price-related factors and subfactors, and

4 noncost-related or nonprice-related factors and

5 subfactors)’’;

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

7 subfactors’’ after ‘‘factors’’;

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

9 clause (i) and inserting in lieu thereof the following:

10 ‘‘(i) either a statement that the pro11 posals are intended to be evaluated with,

12 and award made after, discussions with the

13 offerors, or a statement that the proposals

14 are intended to be evaluated, and award

15 made, without discussions with the offerors

16 (other than discussions conducted for the

17 purpose of minor clarification) unless dis18 cussions are determined to be necessary;

19 and’’; and

20 (4) by adding at the end the following new sub21 section:

22 ‘‘(c)(1) In prescribing the evaluation factors to be in23 cluded in each solicitation for competitive proposals, an

24 agency head—
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1 ‘‘(A) shall clearly establish the relative impor2 tance assigned to the evaluation factors and

3 subfactors, including the quality of the product or

4 services to be provided (including technical capabil5 ity, management capability, prior experience, and

6 past performance of the offeror);

7 ‘‘(B) shall include cost or price to the Govern8 ment as an evaluation factor that must be consid9 ered in the evaluation of proposals; and

10 ‘‘(C) shall disclose to offerors whether all eval11 uation factors other than cost or price, when com12 bined, are—

13 ‘‘(i) significantly more important than cost

14 or price;

15 ‘‘(ii) approximately equal in importance to

16 cost or price; or

17 ‘‘(iii) significantly less important than cost

18 or price.

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

20 from—

21 ‘‘(A) providing additional information in a solic22 itation, including numeric weights for all evaluation

23 factors; or

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

25 made to the offeror that meets the solicitation’s
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1 mandatory requirements at the lowest price or

2 cost.’’.

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

4 Federal Property and Administrative Services Act of 1949

5 (41 U.S.C. 253b) is amended—

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

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

8 (2) in subsection (c), by inserting ‘‘in accord9 ance with subsection (a)’’ in the second sentence

10 after ‘‘shall evaluate the bids’’; and

11 (3) in subsection (d)—

12 (A) by striking out paragraph (1) and in13 serting in lieu thereof the following:

14 ‘‘(1) An agency head shall evaluate competitive pro15 posals in accordance with subsection (a) and may award

16 a contract—

17 ‘‘(A) after discussions with the offerors, pro18 vided that written or oral discussions have been con19 ducted with all responsible offerors who submit pro20 posals within the competitive range; or

21 ‘‘(B) based on the proposals received and with22 out discussions with the offerors (other than discus23 sions conducted for the purpose of minor clarifica24 tion), provided that, as required by section

25 303A(b)(2)(B)(i), the solicitation included a state-
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1 ment that proposals are intended to be evaluated,

2 and award made, without discussions, unless discus3 sions are determined to be necessary.’’;

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

5 and by redesignating paragraph (4) as para6 graph (2); and

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

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

9 ‘‘price’’ in the first sentence.

10 (c) APPLICABILITY.—

11 (1) IN GENERAL.—Except as provided in para12 graph (2), the amendments made by this section

13 shall apply to—

14 (A) solicitations for sealed bids or competi15 tive proposals issued after the end of the 180-

16 day period beginning on the date of the enact17 ment of this Act; and

18 (B) contracts awarded pursuant to those

19 solicitations.

20 (2) AUTHORITY TO APPLY AMENDMENTS

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

22 the amendments made by this section to solicitations

23 issued before the end of the period referred to in

24 paragraph (1). The head of the executive agency

25 shall publish in the Federal Register notice of any
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1 such earlier date of application at least 10 days be2 fore that date.

3 SEC. 1062. SOLICITATION PROVISION REGARDING EVALUA4 TION OF PURCHASE OPTIONS.

5 Section 303A of the Federal Property and Adminis6 trative Services Act of 1949 (41 U.S.C. 253a), as amend7 ed by section 1061(a)(4), is further amended by adding

8 at the end the following new subsection:

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

10 contract to be awarded using sealed bid procedures, may

11 not include in such solicitation a clause providing for the

12 evaluation of prices for options to purchase additional

13 property or services under the contract unless the agency

14 head has determined that there is a reasonable likelihood

15 that the options will be exercised.’’.

16 SEC. 1063. PROMPT NOTICE OF AWARD.

17 (a) SEALED BID PROCEDURES.—Subsection (c) of

18 section 303B of the Federal Property and Administrative

19 Services Act of 1949 (41 U.S.C. 253b) is amended by add20 ing at the end the following: ‘‘As soon as practicable after

21 the date of contract award, the agency head shall, in ac22 cordance with procedures prescribed in the Federal Acqui23 sition Regulation, notify all offerors not awarded the con24 tract that the contract has been awarded.’’.
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1 (b) COMPETITIVE PROPOSALS PROCEDURES.—Para2 graph (2) of section 303B(d) of the Federal Property and

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

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

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

10 SEC. 1064. POST-AWARD DEBRIEFINGS.

11 Section 303B of the Federal Property and Adminis12 trative Services Act of 1949 (41 U.S.C. 253b) is amend13 ed—

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

15 subsections (f) and (g), respectively; and

16 (2) by inserting after subsection (d) the follow17 ing new subsection (e):

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

19 an executive agency on the basis of competitive proposals,

20 an unsuccessful offeror, upon written request received by

21 the agency within 3 days after the date on which the un22 successful offeror receives the notification of the contract

23 award, shall be debriefed and furnished the basis for the

24 selection decision and contract award. An employee of the
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1 executive agency shall debrief the offeror promptly after

2 receipt of the request by the agency.

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

4 ‘‘(A) the executive agency’s evaluation of the

5 significant weak or deficient factors in the offeror’s

6 offer;

7 ‘‘(B) the overall evaluated cost and technical

8 rating of the offer of the contractor awarded the

9 contract and the overall evaluated cost and technical

10 rating of the offer of the debriefed offeror;

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

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

13 ‘‘(E) in the case of a proposal for a commercial

14 item other than a commercial component, the make

15 and model of the item being provided in accordance

16 with the offer of the contractor awarded the con17 tract; and

18 ‘‘(F) reasonable responses to questions posed by

19 the debriefed offeror as to whether source selection

20 procedures set forth in the solicitation, applicable

21 regulations, and other applicable authorities were

22 followed by the executive agency.

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

24 comparisons of the debriefed offeror’s offer with other of25 fers and may not disclose any information that is exempt
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1 from disclosure under section 552 of title 5, United States

2 Code, including information relating to—

3 ‘‘(A) trade secrets;

4 ‘‘(B) privileged or confidential manufacturing

5 processes and techniques; and

6 ‘‘(C) commercial and financial information that

7 is privileged or confidential, including cost break8 downs, profit, indirect cost rates, and similar infor9 mation.

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

11 include a statement that information described in para12 graph (2) may be disclosed in post-award debriefings.

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

14 award and as a result of a successful procurement protest

15 or otherwise, the executive agency seeks to fulfill the re16 quirement under the contract either on the basis of a new

17 solicitation of offers or on the basis of new best and final

18 offers requested for that contract, the agency head shall

19 make available to all offerors—

20 ‘‘(A) the information provided in debriefings

21 under this subsection regarding the offer of the con22 tractor awarded the contract; and

23 ‘‘(B) the same information that would have

24 been provided to the original offerors.
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1 ‘‘(6) The contracting officer shall include a summary

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

3 SEC. 1065. PROTEST FILE.

4 Section 303B of the Federal Property and Adminis5 trative Services Act of 1949 (41 U.S.C. 253b), as amend6 ed by section 1064(1), is further amended by adding at

7 the end the following:

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

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

10 by, an agency head, a protest is filed pursuant to the pro11 cedures in subchapter V of chapter 35 of title 31, United

12 States Code, and an actual or prospective offeror so re13 quests, a file of the protest shall be established by the pro14 curing activity and reasonable access shall be provided to

15 actual or prospective offerors.

16 ‘‘(2) Information exempt from disclosure under sec17 tion 552 of title 5, United States Code, may be redacted

18 in a file established pursuant to paragraph (1) unless an

19 applicable protective order provides otherwise.

20 ‘‘(3) Regulations implementing this subsection shall

21 be consistent with the regulations regarding the prepara22 tion and submission of an agency’s protest file (the so23 called ‘rule 4 file’) for protests to the General Services

24 Board of Contract Appeals under section 111 of the Fed-
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1 eral Property and Administrative Services Act of 1949 (41

2 U.S.C. 759).’’.

3 SEC. 1066. AWARD OF COSTS AND FEES IN AGENCY SETTLE4 MENT OF PROTESTS.

5 Section 303B of the Federal Property and Adminis6 trative Services Act of 1949 (41 U.S.C. 253b), as amend7 ed by section 1065, is further amended by adding at the

8 end the following new subsection:

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

10 determines that a solicitation, proposed award, or award

11 does not comply with the requirements of law or regula12 tion, the agency head may take—

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

14 through (F) of subsection (b)(1) of section 3554 of

15 title 31, United States Code; and

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

17 of section 3554(c) of such title within the limits re18 ferred to in paragraph (2) of such section.’’.

19 SEC. 1067. TWO-PHASE SELECTION PROCEDURES.

20 (a) PROCEDURES AUTHORIZED.—Title III of the

21 Federal Property and Administrative Services Act of 1949

22 (41 U.S.C. 251 et seq.), as amended by section 1054, is

23 further amended by inserting after section 303H the fol24 lowing new section:
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1 ‘‘TWO-PHASE SELECTION PROCEDURES

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

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

4 procedures for entering into a contract for the acquisition

5 of property or services (other than a construction con6 tract) when the agency head determines that three or

7 more offers will be received for such contract, substantial

8 design work must be performed before an offeror can de9 velop a price or cost proposal for such contract, and the

10 offerors will incur a substantial amount of expenses in pre11 paring the offers.

12 ‘‘(b) PROCEDURES DESCRIBED.—Two-phase selec13 tion procedures consist of the following:

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

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

16 ‘‘(i) technical approach; and

17 ‘‘(ii) technical qualifications; and

18 ‘‘(B) do not include—

19 ‘‘(i) detailed design information; or

20 ‘‘(ii) cost or price information.

21 ‘‘(2) The agency head evaluates the proposals

22 on the basis of evaluation criteria set forth in the so23 licitation, except that the agency head does not con24 sider cost-related or price-related evaluation factors.
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1 ‘‘(3) The agency head selects at least three

2 offerors as the most highly qualified to provide the

3 property or services under the contract and requests

4 the selected offerors to submit competitive proposals

5 that include cost or price information.

6 ‘‘(4) The agency head awards the contract in

7 accordance with section 303B(d).

8 ‘‘(c) SOLICITATION TO STATE NUMBER OF

9 OFFERORS TO BE SELECTED FOR PHASE TWO RE10 QUESTS FOR COMPETITIVE PROPOSALS.—A solicitation

11 issued pursuant to subsection (b)(1) shall state the maxi12 mum number of offerors that are to be selected to submit

13 competitive proposals pursuant to subsection (b)(3).

14 ‘‘(d) RESOURCE COMPARISON CRITERION RE15 QUIRED.—In using two-phase selection procedures for en16 tering into a contract, the agency head shall establish a

17 resource criterion or a financial criterion applicable to the

18 contract in order to provide a consistent basis for compar19 ing the offerors and their proposals.’’.

20 (b) CLERICAL AMENDMENT.—The table of contents

21 in the first section of such Act, as amended by section

22 1054, is further amended by inserting after the item relat23 ing to section 303H the following new item:

‘‘Sec. 303I. Two-phase selection procedures.’’.
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1 Subpart C—Kinds of Contracts

2 SEC. 1071. AGENCY HEAD DETERMINATION REGARDING

3 USE OF COST TYPE OR INCENTIVE CON4 TRACT.

5 Section 304(b) of the Federal Property and Adminis6 trative Services Act of 1949 (41 U.S.C. 254(b)) is amend7 ed by striking out the second sentence.

8 SEC. 1072. MULTIYEAR CONTRACTING AUTHORITY.

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

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

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

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

13 ‘‘MULTIYEAR CONTRACTS

14 ‘‘SEC. 303J. (a) AUTHORITY.—The head of an execu15 tive agency may enter into a multiyear contract for the

16 acquisition of property or services if—

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

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

19 first fiscal year in which the contract is in effect,

20 and for the estimated costs associated with any nec21 essary termination of such contract; and

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

23 ‘‘(A) the need for the property or services

24 is reasonably firm and continuing over the pe25 riod of the contract; and
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1 ‘‘(B) a multiyear contract will serve the

2 best interests of the United States by encourag3 ing effective competition or promoting economy

4 in administration, performance, and operation

5 of the agency’s programs.

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

7 entered into under the authority of this section shall in8 clude a clause that provides that the contract shall be ter9 minated if funds are not made available for the continu10 ation of such contract in any fiscal year covered by the

11 contract. Amounts available for paying termination costs

12 shall remain available for such purpose until the costs as13 sociated with termination of the contract are paid.

14 ‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sec15 tion is intended to modify or affect any other provision

16 of law that authorizes multiyear contracts.’’.

17 (b) CLERICAL AMENDMENT.—The table of contents

18 in the first section of such Act, as amended by section

19 1067, is further amended by inserting after the item relat20 ing to section 303I the following new item:

‘‘Sec. 303J. Multiyear contracts.’’.

21 SEC. 1073. SEVERABLE SERVICES CONTRACTS CROSSING

22 FISCAL YEARS.

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

24 and Administrative Services Act of 1949 (41 U.S.C. 251
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1 et seq.), as amended by section 1072, is further amended

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

3 ‘‘SEVERABLE SERVICES CONTRACTS FOR PERIODS

4 CROSSING FISCAL YEARS

5 ‘‘SEC. 303K. (a) AUTHORITY.—The head of an exec6 utive agency may enter into a contract for procurement

7 of severable services for a period that begins in one fiscal

8 year and ends in the next fiscal year if (without regard

9 to any option to extend the period of the contract) the

10 contract period does not exceed one year.

11 ‘‘(b) OBLIGATION OF FUNDS.—Funds made available

12 for a fiscal year may be obligated for the total amount

13 of a contract entered into under the authority of sub14 section (a).’’.

15 (b) CLERICAL AMENDMENT.—The table of contents

16 in the first section of such Act, as amended by section

17 1072, is further amended by inserting after the item relat18 ing to section 303J the following new item:

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

19 SEC. 1074. ECONOMY ACT PURCHASES.

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

21 months after the date of the enactment of this Act, the

22 Federal Acquisition Regulation shall be revised to include

23 regulations governing the exercise of the authority under

24 section 1535 of title 31, United States Code, for Federal
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1 agencies to purchase goods and services under contracts

2 entered into or administered by other agencies.

3 (b) CONTENT OF REGULATIONS.—The regulations

4 prescribed pursuant to subsection (a) shall—

5 (1) require that each purchase described in sub6 section (a) be approved in advance by a contracting

7 officer of the ordering agency with authority to con8 tract for the goods or services to be purchased or by

9 another official in a position specifically designated

10 by regulation to approve such purchase;

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

12 services may be made only if—

13 (A) the purchase is appropriately made

14 under a contract that the agency filling the pur15 chase order entered into, before the purchase

16 order, in order to meet the requirements of

17 such agency for the same or similar goods or

18 services;

19 (B) the agency filling the purchase order is

20 better qualified to enter into or administer the

21 contract for such goods or services by reason of

22 capabilities or expertise that is not available

23 within the ordering agency; or

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

25 specifically authorized by law or regulations to
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1 purchase such goods or services on behalf of

2 other agencies;

3 (3) prohibit any such purchase under a contract

4 or other agreement entered into or administered by

5 an agency not covered by the provisions of chapter

6 137 of title 10, United States Code, or title III of

7 the Federal Property and Administrative Services

8 Act of 1949 (41 U.S.C. 251 et seq.) and not covered

9 by the Federal Acquisition Regulation unless the

10 purchase is approved in advance by the senior pro11 curement official responsible for purchasing by the

12 ordering agency; and

13 (4) prohibit any payment to the agency filling

14 a purchase order of any fee that exceeds the actual

15 cost or, if the actual cost is not known, the esti16 mated cost of entering into and administering the

17 contract or other agreement under which the order

18 is filled.

19 (c) MONITORING SYSTEM REQUIRED.—The Adminis20 trator for Federal Procurement Policy shall ensure that,

21 not later than one year after the date of the enactment

22 of this Act, systems for collecting and evaluating procure23 ment data are capable of collecting and evaluating appro24 priate data on procurements conducted under the regula25 tions prescribed pursuant to subsection (a).
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1 (d) TERMINATION.—This section shall cease to be ef2 fective one year after the date on which final regulations

3 prescribed pursuant to subsection (a) take effect.

4 PART III—ACQUISITIONS GENERALLY

5 SEC. 1091. POLICY REGARDING CONSIDERATION OF CON6 TRACTOR PAST PERFORMANCE.

7 (a) POLICY.—Section 2 of the Office of Federal Pro8 curement Policy Act (41 U.S.C. 401) is amended—

9 (1) by striking out ‘‘and’’ at the end of para10 graph (12);

11 (2) by striking out the period at the end of

12 paragraph (13) and inserting in lieu thereof ‘‘; and’’;

13 and

14 (3) by adding at the end the following new

15 paragraph:

16 ‘‘(14) establishing policies and procedures that

17 encourage the consideration of contractors’ past per18 formance in the selection of contractors.’’.

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

20 of Federal Procurement Policy Act (41 U.S.C. 405) is

21 amended by adding at the end the following:

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

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

24 one of the relevant factors that contracting officials
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1 of executive agencies should consider in entering into

2 contracts.

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

4 to consider past contract performance of an offeror

5 as an indicator of the likelihood that the offeror will

6 successfully perform a contract to be entered into by

7 that official.

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

9 agencies guidance regarding consideration of the past con10 tract performance of offerors in awarding contracts. The

11 guidance shall include—

12 ‘‘(A) standards for evaluating past performance

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

14 compliance with technical or functional specifica15 tions, and other relevant performance factors that

16 facilitate consistent and fair evaluation by all execu17 tive agencies;

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

19 of information on past contract performance that, to

20 the maximum extent practicable, facilitate auto21 mated collection, maintenance, and dissemination of

22 information and provide for ease of collection, main23 tenance, and dissemination of information by other

24 methods, as necessary; and

25 ‘‘(C) policies for ensuring that—
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1 ‘‘(i) offerors are afforded an opportunity to

2 submit relevant information on past contract

3 performance, including performance under con4 tracts entered into by the executive agency con5 cerned, contracts entered into by other depart6 ments and agencies of the Federal Government,

7 contracts entered into by agencies of State and

8 local governments, and contracts entered into

9 by commercial customers; and

10 ‘‘(ii) such information submitted by

11 offerors is considered.

12 ‘‘(3) The Administrator shall prescribe for all execu13 tive agencies guidance regarding the period for which in14 formation on past performance of offerors should be main15 tained and considered.

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

17 is no information on past contract performance or regard18 ing whom information on past contract performance is not

19 available, the offeror may not be evaluated favorably or

20 unfavorably on the factor of past contract performance.’’.

21 SEC. 1092. REPEAL OF REQUIREMENT FOR ANNUAL RE22 PORT ON COMPETITION.

23 Section 23 of the Office of Federal Procurement Pol24 icy Act (41 U.S.C. 419) is repealed.
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1 Subtitle B—Truth in Negotiations

2 PART I—ARMED SERVICES ACQUISITIONS

3 SEC. 1201. STABILIZATION OF DOLLAR THRESHOLD OF AP4 PLICABILITY.

5 (a) REPEAL OF REVERSION TO LOWER THRESH6 OLD.—Paragraph (1)(A) of section 2306a(a) of title 10,

7 United States Code, is amended—

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

9 January 1, 1996,’’; and

10 (2) in clause (ii), by striking out ‘‘or after De11 cember 31, 1995,’’.

12 (b) ADJUSTMENTS FOR CHANGES IN DOLLAR VAL13 UES.—Section 2306a(a) of such title is amended by add14 ing at the end the following new subparagraph:

15 ‘‘(7) Effective on October 1 of each year that is divis16 ible by 5, each amount set forth in paragraph (1) shall

17 be adjusted to the amount that is equal to the fiscal year

18 1994 constant dollar value of the amount set forth. Any

19 amount, as so adjusted, that is not evenly divisible by

20 $50,000 shall be rounded to the nearest multiple of

21 $50,000. In the case of an amount that is evenly divisible

22 by $25,000 but not evenly divisible by $50,000, the

23 amount shall be rounded to the next higher multiple of

24 $50,000.’’.
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1 SEC. 1202. EXCEPTIONS TO COST OR PRICING DATA RE2 QUIREMENTS.

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

4 2306a of title 10, United States Code, is amended to read

5 as follows:

6 ‘‘(b) EXCEPTIONS.—(1) Submission of cost and pric7 ing data shall not be required under subsection (a)—

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

9 or a contract or subcontract modification, for which

10 the price agreed upon is based on—

11 ‘‘(i) adequate price competition;

12 ‘‘(ii) established catalog or market prices

13 of commercial items or of services customarily

14 used for other than Government purposes, as

15 the case may be, that are sold in substantial

16 quantities to the general public; or

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

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

19 the agency concerned determines that the require20 ments of this section may be waived and states in

21 writing the reasons for such determination.

22 ‘‘(2) Submission of cost and pricing data shall not

23 be required under subsection (a) in the case of a modifica24 tion of a contract or subcontract for a commercial item

25 if—
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1 ‘‘(A) the contract or subcontract being modified

2 is a contract or subcontract for which submission of

3 cost and pricing data may not be required by reason

4 of paragraph (1)(A);

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

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

7 from requiring submission of cost and pricing data;

8 and

9 ‘‘(C) the modification would not change the

10 contract or subcontract, as the case may be, from a

11 contract or subcontract for the acquisition of a com12 mercial item to a contract or subcontract for the ac13 quisition of a noncommercial item.’’.

14 (b) CONFORMING AMENDMENT TO REFERENCE.—

15 Subsection (a)(5) of such section is amended by striking

16 out ‘‘subsection (b)(2)’’ and inserting in lieu thereof ‘‘sub17 section (b)(1)(B)’’.

18 SEC. 1203. LIMITATION ON AUTHORITY TO REQUIRE A SUB19 MISSION NOT OTHERWISE REQUIRED.

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

21 States Code, is amended to read as follows:

22 ‘‘(c) LIMITATION ON AUTHORITY TO REQUIRE COST

23 OR PRICING DATA.—When cost or pricing data are not

24 required to be submitted under this section by reason of

25 a $500,000 threshold set forth in subsection (a) (as ad-
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1 justed pursuant to paragraph (7) of such subsection) or

2 by reason of an exception set forth in paragraph (1)(A)

3 or (2) of subsection (b), submission of such data may not

4 be required unless the head of an agency concerned deter5 mines that such data are necessary for the evaluation by

6 the agency of the reasonableness of the price of the con7 tract or subcontract to which the data relate. In any case

8 in which the head of an agency requires such data to be

9 submitted in accordance with the preceding sentence, the

10 agency head shall document in writing the reasons for

11 such requirement.’’.

12 SEC. 1204. ADDITIONAL SPECIAL RULES FOR COMMERCIAL

13 ITEMS.

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

15 amended—

16 (1) by redesignating subsections (d), (e), (f),

17 and (g) as subsections (e), (f), (g), and (i), respec18 tively; and

19 (2) by inserting after subsection (c) the follow20 ing new subsection (d):

21 ‘‘(d) ADDITIONAL EXCEPTION PROVISIONS REGARD22 ING COMMERCIAL ITEMS.—(1) To the maximum extent

23 practicable, the head of an agency shall conduct procure24 ments of commercial items on a competitive basis.
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1 ‘‘(2) In any case in which it is not practicable to con2 duct a procurement of a commercial item on a competitive

3 basis and the procurement is not covered by an exception

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

5 exempt a contract, subcontract, or modification of a con6 tract or subcontract under the procurement from the re7 quirements of subsection (a) if the contracting officer ob8 tains, in accordance with standards and procedures set

9 forth in the Federal Acquisition Regulation, information

10 on prices at which the same or similar items have been

11 sold in the commercial market that is adequate for evalu12 ating the reasonableness of the price of the contract or

13 subcontract for a commercial item, or the contract or sub14 contract modification, as the case may be. The contracting

15 officer may obtain such information from the offeror or

16 contractor or, when such information is not available from

17 that source, from another source or sources.

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

24 information in order to determine whether the agency is

25 receiving 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

4 respect 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

9 by section 1204(1), and inserting in lieu thereof the fol10 lowing:

11 ‘‘(g) RIGHT OF UNITED STATES TO EXAMINE CON12 TRACTOR RECORDS.—For the purpose of evaluating the

13 accuracy, completeness, and currency of cost or pricing

14 data required to be submitted by this section, the head

15 of an agency shall have the rights provided by section

16 2313 of this title.’’.

17 SEC. 1206. REQUIRED REGULATIONS.

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

19 amended by sections 1204 and 1205, is further amended

20 by inserting after subsection (g) the following new sub21 section:

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

23 prescribe regulations concerning the types of information

24 that offerors must submit for a contracting officer to con25 sider in determining whether the price of a procurement
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1 to the Government is fair and reasonable when certified

2 cost or pricing data are not required to be submitted

3 under this section because the price of the procurement

4 to the United States is not expected to exceed an applica5 ble $500,000 threshold set forth in subsection (a) (as ad6 justed pursuant to paragraph (7) of such subsection).

7 Such information, at a minimum, shall include appropriate

8 information on the prices at which the same or similar

9 items have previously been sold that is adequate for evalu10 ating the reasonableness of the price of the proposed con11 tract or subcontract for the procurement.’’.

12 SEC. 1207. CONSISTENCY OF TIME REFERENCES.

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

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

15 (1) in subparagraphs (A)(ii) and (B)(ii) of sub16 section (e)(4), by inserting ‘‘or, if applicable consist17 ent with paragraph (1)(B), another date agreed

18 upon between the parties,’’ after ‘‘(or price of the

19 modification)’’; and

20 (2) in subsection (i), by inserting ‘‘or, if appli21 cable consistent with subsection (d)(1)(B), another

22 date agreed upon between the parties’’ after ‘‘(or the

23 price of a contract modification)’’.
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1 SEC. 1208. EXCEPTION FOR TRANSFERS BETWEEN DIVI2 SIONS, SUBSIDIARIES, AND AFFILIATES.

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

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

5 amended to read as follows:

6 ‘‘(i) DEFINITIONS.—In this section:

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

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

9 of a contract (or the price of a contract modifica10 tion), a prudent buyer or seller would reasonably ex11 pect to affect price negotiations significantly. Such

12 term does not include information that is

13 judgmental, but does include the factual information

14 from which a judgment was derived.

15 ‘‘(2) The term ‘subcontract’ includes a transfer

16 of commercial items between divisions, subsidiaries,

17 or affiliates of a contractor.’’.

18 SEC. 1209. REPEAL OF SUPERSEDED PROVISION.

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

20 101–510 (10 U.S.C. 2306a note) are repealed.
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1 PART II—CIVILIAN AGENCY ACQUISITIONS

2 SEC. 1251. REVISION OF CIVILIAN AGENCY PROVISIONS TO

3 ENSURE UNIFORM TREATMENT OF COST OR

4 PRICING DATA.

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

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

7 et seq.) is amended—

8 (1) in section 304, by striking out subsection

9 (d); and

10 (2) by inserting after section 304 the following

11 new section:

12 ‘‘COST OR PRICING DATA: TRUTH IN NEGOTIATIONS

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

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

15 offerors, contractors, and subcontractors to make cost or

16 pricing data available as follows:

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

18 title to be entered into using procedures other than

19 sealed-bid procedures shall be required to submit

20 cost or pricing data before the award of a contract

21 if—

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

23 into after the date of the enactment of the Fed24 eral Acquisition Streamlining Act of 1994, the

25 price of the contract to the United States is ex26 pected to exceed $500,000; and
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1 ‘‘(ii) in the case of a prime contract en2 tered into on or before the date of the enact3 ment of the Federal Acquisition Streamlining

4 Act of 1994, the price of the contract to the

5 United States is expected to exceed $100,000.

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

7 this chapter shall be required to submit cost or pric8 ing data before the pricing of a change or modifica9 tion to the contract if—

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

11 made to a prime contract referred to in sub12 paragraph (A)(i), the price adjustment is ex13 pected to exceed $500,000;

14 ‘‘(ii) in the case of a change or modifica15 tion made to a prime contract that was entered

16 into on or before the date of the enactment of

17 the Federal Acquisition Streamlining Act of

18 1994, and that has been modified pursuant to

19 paragraph (6), the price adjustment is expected

20 to exceed $500,000; and

21 ‘‘(iii) in the case of a change or modifica22 tion not covered by clause (i) or (ii), the price

23 adjustment is expected to exceed $100,000.

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

25 of a contract under this title shall be required to
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1 submit cost or pricing data before the award of the

2 subcontract if the prime contractor and each higher3 tier subcontractor have been required to make avail4 able cost or pricing data under this section and—

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

6 prime contract referred to in subparagraph

7 (A)(i), the price of the subcontract is expected

8 to exceed $500,000;

9 ‘‘(ii) in the case of a subcontract entered

10 into under a prime contract that was entered

11 into on or before the date of the enactment of

12 the Federal Acquisition Streamlining Act of

13 1994, and that has been modified pursuant to

14 paragraph (6), the price of the subcontract is

15 expected to exceed $500,000; and

16 ‘‘(iii) in the case of a subcontract not cov17 ered by clause (i) or (ii), the price of the sub18 contract is expected to exceed $100,000.

19 ‘‘(D) The subcontractor for a subcontract cov20 ered by subparagraph (C) shall be required to sub21 mit cost or pricing data before the pricing of a

22 change or modification to the subcontract if—

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

24 to a subcontract referred to in subparagraph
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1 (C)(i) or (C)(ii), the price adjustment is ex2 pected to exceed $500,000; and

3 ‘‘(ii) in the case of a change or modifica4 tion to a subcontract referred to in subpara5 graph (C)(iii), the price adjustment is expected

6 to exceed $100,000.

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

8 subcontractor, to submit cost or pricing data under para9 graph (1) (or required by the agency head concerned to

10 submit such data in accordance with subsection (c)) shall

11 be required to certify that, to the best of the person’s

12 knowledge and belief, the cost or pricing data submitted

13 are accurate, complete, and current.

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

15 under paragraph (1) (or in accordance with subsection

16 (c)), and a certification required to be submitted under

17 paragraph (2), shall be submitted—

18 ‘‘(A) in the case of a submission by a prime

19 contractor (or an offeror for a prime contract), to

20 the contracting officer for the contract (or to a des21 ignated representative of the contracting officer); or

22 ‘‘(B) in the case of a submission by a sub23 contractor (or an offeror for a subcontract), to the

24 prime contractor.
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1 ‘‘(4) Except as provided under subsection (b), this

2 section applies to contracts entered into by an agency head

3 on behalf of a foreign government.

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

5 or subcontractor granted a waiver under subsection

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

7 make available cost or pricing data under this section.

8 ‘‘(6)(A) Upon the request of a contractor that was

9 required to submit cost or pricing data under paragraph

10 (1) in connection with a prime contract entered into on

11 or before the date of the enactment of the Federal Acquisi12 tion Streamlining Act of 1994, the agency head that en13 tered into such contract shall modify the contract to re14 flect subparagraphs (B)(ii) and (C)(ii) of paragraph (1).

15 All such modifications shall be made without requiring

16 consideration.

17 ‘‘(B) An agency head is not required to modify a con18 tract under subparagraph (A) if that agency head deter19 mines that the submission of cost or pricing data with re20 spect to that contract should be required in accordance

21 with subsection (c).

22 ‘‘(7) Effective on October 1 of each year that is divis23 ible by 5, each amount set forth in paragraph (1) shall

24 be adjusted to the amount that is equal to the fiscal year

25 1994 constant dollar value of the amount set forth. Any
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1 amount, as so adjusted, that is not evenly divisible by

2 $50,000 shall be rounded to the nearest multiple of

3 $50,000. In the case of an amount that is evenly divisible

4 by $25,000 but not evenly divisible by $50,000, the

5 amount shall be rounded to the next higher multiple of

6 $50,000.

7 ‘‘(b) EXCEPTIONS.—(1) Submission of cost and pric8 ing data shall not be required under subsection (a)—

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

10 or a contract or subcontract modification, for which

11 the price agreed upon is based on—

12 ‘‘(i) adequate price competition;

13 ‘‘(ii) established catalog or market prices

14 of commercial items or of services customarily

15 used for other than Government purposes, as

16 the case may be, that are sold in substantial

17 quantities to the general public; or

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

19 ‘‘(B) in an exceptional case when the agency

20 head concerned determines that the requirements of

21 this section may be waived and states in writing the

22 reasons for such determination.

23 ‘‘(2) Submission of cost and pricing data shall not

24 be required under subsection (a) in the case of a modifica-
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1 tion of a contract or subcontract for a commercial item

2 if—

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

4 is a contract or subcontract for which submission of

5 cost and pricing data may not be required by reason

6 of paragraph (1)(A);

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

8 paragraph (1)(A) prohibits the agency head from re9 quiring submission of cost and pricing data; and

10 ‘‘(C) the modification would not change the

11 contract or subcontract, as the case may be, from a

12 contract or subcontract for the acquisition of a com13 mercial item to a contract or subcontract for the ac14 quisition of a noncommercial item.

15 ‘‘(c) LIMITATION ON AUTHORITY TO REQUIRE COST

16 OR PRICING DATA.—When cost or pricing data are not

17 required to be submitted under this section by reason of

18 a $500,000 threshold set forth in subsection (a) (as ad19 justed pursuant to paragraph (7) of such subsection) or

20 by reason of an exception in paragraph (1)(A) or (2) of

21 subsection (b), submission of such data may not be re22 quired unless the agency head concerned determines that

23 such data are necessary for the evaluation by the agency

24 of the reasonableness of the price of the contract or sub25 contract to which the data relate. In any case in which
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1 the agency head requires such data to be submitted in ac2 cordance with the preceding sentence, the agency head

3 shall document in writing the reasons for such require4 ment.

5 ‘‘(d) ADDITIONAL EXCEPTION PROVISIONS REGARD6 ING COMMERCIAL ITEMS.—(1) To the maximum extent

7 practicable, an agency head shall conduct procurements

8 of commercial items on a competitive basis.

9 ‘‘(2) In any case in which it is not practicable to con10 duct a procurement of a commercial item on a competitive

11 basis and the procurement is not covered by an exception

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

13 exempt a contract, subcontract, or modification of a con14 tract or subcontract under the procurement from the re15 quirements of subsection (a) if the contracting officer ob16 tains, in accordance with standards and procedures set

17 forth in the Federal Acquisition Regulation, information

18 on prices at which the same or similar items have been

19 sold in the commercial market that is adequate for evalu20 ating the reasonableness of the price of the contract or

21 subcontract for a commercial item, or the contract or sub22 contract modification, as the case may be. The contracting

23 officer may obtain such information from the offeror or

24 contractor or, when such information is not available from

25 that source, from another source or sources.
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1 ‘‘(3)(A) In accordance with procedures prescribed in

2 the Federal Acquisition Regulation, an agency head shall

3 have the right to examine all information provided by an

4 offeror, contractor, or subcontractor pursuant to para5 graph (2) and all books and records of such offeror, con6 tractor, or subcontractor that directly relate to such infor7 mation in order to determine whether the agency is receiv8 ing accurate information required under this section.

9 ‘‘(B) The right under subparagraph (A) shall expire

10 3 years after the date of award of the contract, or 3 years

11 after the date of the modification of the contract, with

12 respect to which the information was provided.

13 ‘‘(e) PRICE REDUCTIONS FOR DEFECTIVE COST OR

14 PRICING DATA.—(1)(A) A prime contract (or change or

15 modification to a prime contract) under which a certificate

16 under subsection (a)(2) is required shall contain a provi17 sion that the price of the contract to the United States,

18 including profit or fee, shall be adjusted to exclude any

19 significant amount by which it may be determined by the

20 agency head that such price was increased because the

21 contractor (or any subcontractor required to make avail22 able such a certificate) submitted defective cost or pricing

23 data.

24 ‘‘(B) For the purposes of this section, defective cost

25 or pricing data are cost or pricing data which, as of the
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1 date of agreement on the price of the contract (or another

2 date agreed upon between the parties), were inaccurate,

3 incomplete, or noncurrent. If for purposes of the preceding

4 sentence the parties agree upon a date other than the date

5 of agreement on the price of the contract, the date agreed

6 upon by the parties shall be as close to the date of agree7 ment on the price of the contract as is practicable.

8 ‘‘(2) In determining for purposes of a contract price

9 adjustment under a contract provision required by para10 graph (1) whether, and to what extent, a contract price

11 was increased because the contractor (or a subcontractor)

12 submitted defective cost or pricing data, it shall be a de13 fense that the United States did not rely on the defective

14 data submitted by the contractor or subcontractor.

15 ‘‘(3) It is not a defense to an adjustment of the price

16 of a contract under a contract provision required by para17 graph (1) that—

18 ‘‘(A) the price of the contract would not have

19 been modified even if accurate, complete, and cur20 rent cost or pricing data had been submitted by the

21 contractor or subcontractor because the contractor

22 or subcontractor—

23 ‘‘(i) was the sole source of the property or

24 services procured; or
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1 ‘‘(ii) otherwise was in a superior bargain2 ing position with respect to the property or

3 services procured;

4 ‘‘(B) the contracting officer should have known

5 that the cost and pricing data in issue were defective

6 even though the contractor or subcontractor took no

7 affirmative action to bring the character of the data

8 to the attention of the contracting officer;

9 ‘‘(C) the contract was based on an agreement

10 between the contractor and the United States about

11 the total cost of the contract and there was no

12 agreement about the cost of each item procured

13 under such contract; or

14 ‘‘(D) the prime contractor or subcontractor did

15 not submit a certification of cost and pricing data

16 relating to the contract as required under subsection

17 (a)(2).

18 ‘‘(4)(A) A contractor shall be allowed to offset an

19 amount against the amount of a contract price adjustment

20 under a contract provision required by paragraph (1) if—

21 ‘‘(i) the contractor certifies to the contracting

22 officer (or to a designated representative of the con23 tracting officer) that, to the best of the contractor’s

24 knowledge and belief, the contractor is entitled to

25 the offset; and
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1 ‘‘(ii) the contractor proves that the cost or pric2 ing data were available before the date of agreement

3 on the price of the contract (or price of the modi4 fication), or, if applicable consistent with paragraph

5 (1)(B), another date agreed upon between the par6 ties, and that the data were not submitted as speci7 fied in subsection (a)(3) before such date.

8 ‘‘(B) A contractor shall not be allowed to offset an

9 amount otherwise authorized to be offset under subpara10 graph (A) if—

11 ‘‘(i) the certification under subsection (a)(2)

12 with respect to the cost or pricing data involved was

13 known to be false when signed; or

14 ‘‘(ii) the United States proves that, had the cost

15 or pricing data referred to in subparagraph (A)(ii)

16 been submitted to the United States before the date

17 of agreement on the price of the contract (or price

18 of the modification) or, if applicable under para19 graph (1)(B), another date agreed upon between the

20 parties, the submission of such cost or pricing data

21 would not have resulted in an increase in that price

22 in the amount to be offset.

23 ‘‘(f) INTEREST AND PENALTIES FOR CERTAIN OVER24 PAYMENTS.—(1) If the United States makes an overpay25 ment to a contractor under a contract with an executive
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1 agency subject to this section and the overpayment was

2 due to the submission by the contractor of defective cost

3 or pricing data, the contractor shall be liable to the United

4 States—

5 ‘‘(A) for interest on the amount of such over6 payment, to be computed—

7 ‘‘(i) for the period beginning on the date

8 the overpayment was made to the contractor

9 and ending on the date the contractor repays

10 the amount of such overpayment to the United

11 States; and

12 ‘‘(ii) at the current rate prescribed by the

13 Secretary of the Treasury under section 6621

14 of the Internal Revenue Code of 1986; and

15 ‘‘(B) if the submission of such defective data

16 was a knowing submission, for an additional amount

17 equal to the amount of the overpayment.

18 ‘‘(2) Any liability under this subsection of a contrac19 tor that submits cost or pricing data but refuses to submit

20 the certification required by subsection (a)(2) with respect

21 to the cost or pricing data shall not be affected by the

22 refusal to submit such certification.

23 ‘‘(g) RIGHT OF UNITED STATES TO EXAMINE CON24 TRACTOR RECORDS.—For the purpose of evaluating the

25 accuracy, completeness, and currency of cost or pricing
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1 data required to be submitted by this section, the head

2 of an agency shall have the rights provided by section

3 304B(a)(2).

4 ‘‘(h) REQUIRED REGULATIONS.—The Federal Acqui5 sition Regulation shall include regulations concerning the

6 types of information that offerors must submit for a con7 tracting officer to consider in determining whether the

8 price of a procurement to the Government is fair and rea9 sonable when certified cost or pricing data are not re10 quired to be submitted under this section because the price

11 of the procurement to the United States is not expected

12 to exceed an applicable $500,000 threshold set forth in

13 subsection (a) (as adjusted pursuant to paragraph (7) of

14 such subsection). Such information, at a minimum, shall

15 include appropriate information on the prices at which the

16 same or similar items have previously been sold that is

17 adequate for evaluating the reasonableness of the price of

18 a proposed contract or subcontract for the procurement.

19 ‘‘(i) DEFINITIONS.—In this section:

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

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

22 of a contract (or the price of a contract modifica23 tion) or, if applicable consistent with subsection

24 (e)(1)(B), another date agreed upon between the

25 parties, a prudent buyer or seller would reasonably
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1 expect to affect price negotiations significantly. Such

2 term does not include information that is

3 judgmental, but does include the factual information

4 from which a judgment was derived.

5 ‘‘(2) The term ‘subcontract’ includes a transfer

6 of commercial items between divisions, subsidiaries,

7 or affiliates of a contractor.’’.

8 (b) TABLE OF CONTENTS.—The table of contents in

9 the first section of such Act is amended by inserting after

10 the item relating to section 304 the following:

‘‘Sec. 304A. Cost or pricing data: truth in negotiations.’’.

11 SEC. 1252. REPEAL OF OBSOLETE PROVISION.

12 (a) REPEAL.—Section 303E of the Federal Property

13 and Administrative Services Act of 1949 (41 U.S.C. 253e)

14 is repealed.

15 (b) CLERICAL AMENDMENT.—The table of contents

16 in the first section of such Act is amended by striking out

17 the item relating to section 303E.

18 Subtitle C—Research and

19 Development

20 SEC. 1301. RESEARCH PROJECTS.

21 (a) AUTHORIZED MEANS.—Subsection (b) of section

22 2358 of title 10, United States Code, is amended to read

23 as follows:
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1 ‘‘(b) AUTHORIZED MEANS.—The Secretary of De2 fense or the Secretary of a military department may per3 form research and development projects—

4 ‘‘(1) by contract entered into with, grant made

5 to, or cooperative agreement entered into with edu6 cational or research institutions, private businesses,

7 or other persons in accordance with the provisions of

8 chapter 63 of title 31;

9 ‘‘(2) through one or more military departments;

10 ‘‘(3) by using employees and consultants of the

11 Department of Defense; or

12 ‘‘(4) by mutual agreement with the head of any

13 other department or agency of the Federal Govern14 ment.’’.

15 (b) CAPTION AMENDMENT.—The caption of sub16 section (c) of such section is amended by striking out

17 ‘‘MILITARY’’ and inserting in lieu thereof ‘‘DEPARTMENT

18 OF DEFENSE’’.

19 (c) ADVANCED RESEARCH PROJECTS.—

20 (1) RESTORATION AND REVISION OF FORMER

21 STATEMENT OF AUTHORITY.—Section 2371 of title

22 10, United States Code, is amended—

23 (A) by redesignating subsections (a), (b),

24 (c), (d), (e), and (f) as subsections (b), (c), (d),

25 (e), (f), and (g), respectively; and
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1 (B) by inserting before subsection (b), as

2 so redesignated, the following new subsection

3 (a):

4 ‘‘(a) The Secretary of Defense, acting through the

5 Advanced Research Projects Agency and such other ele6 ments of the Department of Defense as the Secretary may

7 designate, and the Secretary of each military department,

8 in carrying out basic, applied, and advanced research

9 projects, may enter into other transactions, in addition to

10 contracts, grants, and cooperative agreements authorized

11 by section 2358 of this title.’’.

12 (2) CONFORMING AMENDMENTS.—Such section,

13 as amended by paragraph (1), is further amended—

14 (A) in subsection (b)—

15 (i) in paragraph (1), by inserting ‘‘or

16 subsection (a)’’ after ‘‘section 2358 of this

17 title’’; and

18 (ii) in paragraph (2), by striking out

19 ‘‘subsection (d)’’ and inserting in lieu

20 thereof ‘‘subsection (e)’’;

21 (B) in subsection (c), by inserting ‘‘section

22 2358 of this title or’’ after ‘‘under’’;

23 (C) in subsection (d)—

24 (i) in paragraph (1), by striking out

25 ‘‘this section’’ and inserting in lieu thereof
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1 ‘‘section 2358 of this title or subsection

2 (a)’’; and

3 (ii) in paragraph (3), by striking out

4 ‘‘this section’’ and inserting in lieu thereof

5 ‘‘section 2358 of this title or subsection

6 (a)’’;

7 (D) in subsection (e), by inserting ‘‘or sub8 section (a)’’ in the first sentence after ‘‘section

9 2358 of this title’’; and

10 (E) in subsection (f)—

11 (i) in the first sentence, by striking

12 out ‘‘under this section’’ and inserting in

13 lieu thereof ‘‘under section 2358 of this

14 title or subsection (a)’’;

15 (ii) in paragraph (4), by striking out

16 ‘‘subsection (a)’’ and inserting in lieu

17 thereof ‘‘subsection (b)’’; and

18 (iii) in paragraph (5), by striking out

19 ‘‘subsection (d)’’ and inserting in lieu

20 thereof ‘‘subsection (e)’’.
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1 SEC. 1302. ELIMINATION OF INFLEXIBLE TERMINOLOGY

2 REGARDING COORDINATION AND COMMU3 NICATION OF DEFENSE RESEARCH ACTIVI4 TIES.

5 Section 2364 of title 10, United States Code, is

6 amended—

7 (1) in subsection (b)(5), by striking out ‘‘mile8 stone 0, milestone I, and milestone II decisions’’ and

9 inserting in lieu thereof ‘‘acquisition program deci10 sions’’; and

11 (2) in subsection (c), by striking out para12 graphs (2), (3), and (4) and inserting in lieu thereof

13 the following:

14 ‘‘(2) The term ‘acquisition program decisions’

15 has the meaning given such term in regulations pre16 scribed by the Secretary of Defense for the purposes

17 of this section.’’.

18 Subtitle D—Procurement Protests

19 PART I—PROTESTS TO THE COMPTROLLER

20 GENERAL

21 SEC. 1401. PROTEST DEFINED.

22 Paragraph (1) of section 3551 of title 31, United

23 States Code, is amended to read as follows:

24 ‘‘(1) ‘protest’ means a written objection by an

25 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 objec10 tion contains an allegation that the termination

11 or cancellation is based in whole or in part on

12 improprieties 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

17 of 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 mak6 ing of such finding’’.

7 (b) SUSPENSION OF PERFORMANCE.—Subsection (d)

8 of 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 relat12 ed activities that result in obligations being incurred by

13 the United States under the contract unless the contract14 ing officer responsible for the award of the contract with15 holds authorization to proceed with performance of the

16 contract.

17 ‘‘(2) The contracting officer may withhold an author18 ization to proceed with performance of the contract during

19 the period described in paragraph (4) if the contracting

20 officer determines in writing that—

21 ‘‘(A) a protest is likely to be filed; and

22 ‘‘(B) the immediate performance of the contract

23 is not in the best interests of the United States.
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1 ‘‘(3)(A) If the Federal agency awarding the contract

2 receives notice of a protest in accordance with this section

3 during the period described in paragraph (4)—

4 ‘‘(i) the contracting officer may not authorize

5 performance of the contract to begin while the pro6 test is pending; or

7 ‘‘(ii) if contract performance authorization to

8 proceed was not withheld in accordance with para9 graph (2) before receipt of the notice, the contract10 ing officer shall immediately direct the contractor to

11 cease performance under the contract and to sus12 pend any related activities that may result in addi13 tional obligations being incurred by the United

14 States under that contract.

15 ‘‘(B) Performance and related activities suspended

16 pursuant to subparagraph (A)(ii) by reason of a protest

17 may not be resumed while the protest is pending.

18 ‘‘(C) The head of the procuring activity may author19 ize the performance of the contract (notwithstanding a

20 protest of which the Federal agency has notice under this

21 section)—

22 ‘‘(i) upon a written finding that—

23 ‘‘(I) performance of the contract is in the

24 best interests of the United States; or
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1 ‘‘(II) urgent and compelling circumstances

2 that significantly affect interests of the United

3 States will not permit waiting for the decision

4 of the Comptroller General concerning the pro5 test; and

6 ‘‘(ii) after the Comptroller General is notified of

7 that finding.

8 ‘‘(4) The period referred to in paragraphs (2) and

9 (3)(A), with respect to a contract, is the period beginning

10 on the date of the contract award and ending on the later

11 of—

12 ‘‘(A) the date that is 10 days after the date of

13 the contract award; or

14 ‘‘(B) the date that is 5 days after—

15 ‘‘(i) the debriefing date offered to an un16 successful offeror for any debriefing that is re17 quested and, when requested, is required; or

18 ‘‘(ii) in the case of a contract for which no

19 debriefing is required, the date on which the

20 unsuccessful offeror receives the notification of

21 contract award.’’.

22 SEC. 1403. DECISIONS ON PROTESTS.

23 (a) PERIODS FOR CERTAIN ACTIONS.—Section

24 3554(a) of title 31, United States Code, is amended—
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1 (1) in paragraph (1), by striking out ‘‘90 work2 ing days from’’ and inserting in lieu thereof ‘‘125

3 days after’’;

4 (2) in paragraph (2), by striking out ‘‘45 cal5 endar days from’’ and inserting ‘‘65 days after’’;

6 (3) by redesignating paragraph (3) as para7 graph (4); and

8 (4) by inserting after paragraph (2) the follow9 ing new paragraph (3):

10 ‘‘(3) An amendment to a protest that adds a new

11 ground of protest, if timely made, should be resolved, to

12 the maximum extent practicable, within the time limit es13 tablished under paragraph (1) of this subsection for final

14 decision of the initial protest. If an amended protest can15 not be resolved within such time limit, the Comptroller

16 General may resolve the amended protest through the ex17 press option under paragraph (2) of this subsection.’’.

18 (b) GAO RECOMMENDATIONS ON PROTESTS.—

19 (1) IMPLEMENTATION OF RECOMMENDA20 TIONS.—Section 3554 of title 31, United States

21 Code, is amended—

22 (A) in subsection (b), by adding at the end

23 the following new paragraph:

24 ‘‘(3) If the Federal agency fails to implement fully

25 the recommendations of the Comptroller General under
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1 this subsection with respect to a solicitation for a contract

2 or an award or proposed award of a contract within 60

3 days after receiving the recommendations, the head of the

4 procuring activity responsible for that contract shall re5 port such failure to the Comptroller General not later than

6 5 working days after the end of such 60-day period.’’;

7 (B) by striking out subsection (c) and in8 serting in lieu thereof the following:

9 ‘‘(c)(1) If the Comptroller General determines that

10 a solicitation for a contract or a proposed award or the

11 award of a contract does not comply with a statute or reg12 ulation, the Comptroller General may recommend that the

13 Federal agency conducting the procurement pay to an ap14 propriate interested party the costs of—

15 ‘‘(A) filing and pursuing the protest, including

16 reasonable attorney’s fees and consultant and expert

17 witness fees; and

18 ‘‘(B) bid and proposal preparation.

19 ‘‘(2) No party (other than a small business concern

20 (within the meaning of section 3(a) of the Small Business

21 Act)) may be paid, pursuant to a recommendation made

22 under the authority of paragraph (1)—

23 ‘‘(A) costs for consultant and expert witness

24 fees that exceed the rates provided under section

25 504(b)(1)(A) of title 5 for expert witnesses; or
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1 ‘‘(B) costs for attorney’s fees that exceed the

2 rates provided for attorneys under section

3 504(b)(1)(A) of title 5.

4 ‘‘(3) If the Comptroller General recommends under

5 paragraph (1) that a Federal agency pay costs to an inter6 ested party, the Federal agency shall—

7 ‘‘(A) pay the costs promptly; or

8 ‘‘(B) if the Federal agency does not make such

9 payment, promptly report to the Comptroller Gen10 eral the reasons for the failure to follow the Comp11 troller General’s recommendation.

12 ‘‘(4) If the Comptroller General recommends under

13 paragraph (1) that a Federal agency pay costs to an inter14 ested party, the Federal agency and the interested party

15 shall attempt to reach an agreement on the amount of the

16 costs to be paid. If the Federal agency and the interested

17 party are unable to agree on the amount to be paid, the

18 Comptroller General may, upon the request of the inter19 ested party, recommend to the Federal agency the amount

20 of the costs that the Federal agency should pay.’’; and

21 (C) by striking out subsection (e) and in22 serting in lieu thereof the following:

23 ‘‘(e)(1) The Comptroller General shall report prompt24 ly to the Committee on Governmental Affairs and the

25 Committee on Appropriations of the Senate and to the
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1 Committee on Government Operations and the Committee

2 on Appropriations of the House of Representatives any

3 case in which a Federal agency fails to implement fully

4 a recommendation of the Comptroller General under sub5 section (b) or (c). The report shall include—

6 ‘‘(A) a comprehensive review of the pertinent

7 procurement, including the circumstances of the fail8 ure of the Federal agency to implement a rec9 ommendation of the Comptroller General; and

10 ‘‘(B) a recommendation regarding whether, in

11 order to correct an inequity or to preserve the integ12 rity of the procurement process, the Congress should

13 consider—

14 ‘‘(i) private relief legislation;

15 ‘‘(ii) legislative rescission or cancellation of

16 funds;

17 ‘‘(iii) further investigation by Congress; or

18 ‘‘(iv) other action.

19 ‘‘(2) Not later than January 31 of each year, the

20 Comptroller General shall transmit to the Congress a re21 port containing a summary of each instance in which a

22 Federal agency did not fully implement a recommendation

23 of the Comptroller General under subsection (b) or (c)

24 during the preceding year. The report shall also describe

25 each instance in which a final decision in a protest was
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1 not rendered within 125 days after the date the protest

2 is submitted to the Comptroller General.’’.

3 (2) REQUIREMENT FOR PAYMENT IN ACCORD4 ANCE WITH PRIOR GAO DETERMINATIONS.—Costs to

5 which the Comptroller General declared an inter6 ested party to be entitled under section 3554 of title

7 31, United States Code, as in effect immediately be8 fore the enactment of this Act, shall, if not paid or

9 otherwise satisfied by the Federal agency concerned

10 before the date of the enactment of this Act, be paid

11 promptly.

12 SEC. 1404. REGULATIONS.

13 (a) COMPUTATION OF PERIODS.—Section 3555 of

14 title 31, United States Code, is amended—

15 (1) by redesignating subsection (b) as sub16 section (d); and

17 (2) by inserting after subsection (a) the follow18 ing new subsection (b):

19 ‘‘(b) The procedures shall provide that, in the com20 putation of any period described in this subchapter—

21 ‘‘(1) the day of the act, event, or default from

22 which the designated period of time begins to run

23 not be included; and

24 ‘‘(2) the last day after such act, event, or de25 fault be included, unless—
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1 ‘‘(A) such last day is a Saturday, a Sun2 day, or a legal holiday; or

3 ‘‘(B) in the case of a filing of a paper at

4 the General Accounting Office or a Federal

5 agency, such last day is a day on which weather

6 or other conditions cause the closing of the

7 General Accounting Office or Federal agency,

8 in which event the next day that is not a Satur9 day, Sunday, or legal holiday shall be in10 cluded.’’.

11 (b) ELECTRONIC FILINGS AND DISSEMINATIONS.—

12 Such section, as amended by subsection (a), is further

13 amended by inserting after subsection (b) the following

14 new subsection:

15 ‘‘(c) The Comptroller General may prescribe proce16 dures for the electronic filing and dissemination of docu17 ments and information required under this subchapter. In

18 prescribing such procedures, the Comptroller General shall

19 consider the ability of all parties to achieve electronic ac20 cess to such documents and records.’’.

21 (c) REPEAL OF OBSOLETE DEADLINE.—Subsection

22 (a) of such section is amended by striking out ‘‘Not later

23 than January 15, 1985, the’’ and inserting in lieu thereof

24 ‘‘The’’.
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1 PART II—PROTESTS IN THE FEDERAL COURTS

2 SEC. 1421. NONEXCLUSIVITY OF REMEDIES.

3 Section 3556 of title 31, United States Code, is

4 amended by striking out ‘‘a district court of the United

5 States or the United States Claims Court’’ in the first sen6 tence and inserting in lieu thereof ‘‘the United States

7 Court of Federal Claims’’.

8 SEC. 1422. JURISDICTION OF THE UNITED STATES COURT

9 OF FEDERAL CLAIMS.

10 (a) CLAIMS AGAINST THE UNITED STATES AND BID

11 PROTESTS.—Section 1491 of title 28, United States Code,

12 is amended—

13 (1) by redesignating subsection (b) as sub14 section (e);

15 (2) in subsection (a)—

16 (A) by striking out ‘‘(a)(1)’’ and inserting

17 in lieu thereof ‘‘(a) CLAIMS AGAINST THE

18 UNITED STATES.—’’;

19 (B) in paragraph (2), by striking out ‘‘(2)

20 To’’ and inserting in lieu thereof ‘‘(b) REMEDY

21 AND RELIEF.—To’’; and

22 (C) by striking out paragraph (3); and

23 (3) by inserting after subsection (b), as des24 ignated by paragraph (2)(B), the following new sub25 section (c):
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1 ‘‘(c) BID PROTESTS.—(1) The United States Court

2 of Federal Claims has jurisdiction to render judgment on

3 an action by an interested party objecting to a solicitation

4 by a Federal agency for bids or proposals for a proposed

5 contract or to a proposed award or the award of a con6 tract. The court has jurisdiction to entertain such an ac7 tion without regard to whether suit is instituted before or

8 after the contract is awarded.

9 ‘‘(2) To afford relief in such an action, the court may

10 award any relief that the court considers proper, including

11 declaratory and injunctive relief.

12 ‘‘(3) In exercising jurisdiction under this subsection,

13 the court shall give due regard to the interests of national

14 defense and national security and the need for expeditious

15 resolution of the action.

16 ‘‘(4) The district courts of the United States do not

17 have jurisdiction of any action referred to in paragraph

18 (1).’’.

19 (b) CLERICAL AMENDMENTS.—

20 (1) SECTION HEADING.—The heading of such

21 section is amended by inserting ‘‘BID PROTESTS;’’

22 after ‘‘GENERALLY;’’.

23 (2) TABLE OF SECTIONS.—The table of sections

24 at the beginning of chapter 91 of title 28, United

25 States Code, is amended by striking out the item re-
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1 lating to section 1491 and inserting in lieu thereof

2 the following:

‘‘1491. Claims against United States generally; bid protests; actions involving

Tennessee Valley Authority.’’.

3 PART III—PROTESTS IN PROCUREMENTS OF

4 AUTOMATIC DATA PROCESSING

5 SEC. 1431. REVOCATION OF DELEGATIONS OF PROCURE6 MENT AUTHORITY.

7 Section 111(b)(3) of the Federal Property and Ad8 ministrative Services Act of 1949 (40 U.S.C. 759(b)(3))

9 is amended by inserting after the third sentence the fol10 lowing: ‘‘The Administrator may revoke a delegation of

11 authority with respect to a particular contract before or

12 after award of the contract, except that the Administrator

13 may revoke a delegation after the contract is awarded only

14 when there is a finding of a violation of law or regulation

15 in connection with the contract award.’’.

16 SEC. 1432. AUTHORITY OF THE GENERAL SERVICES ADMIN17 ISTRATION BOARD OF CONTRACT APPEALS.

18 The first sentence of section 111(f)(1) of the Federal

19 Property and Administrative Services Act of 1949 (40

20 U.S.C. 759(f)(1)) is amended to read as follows: ‘‘Upon

21 request of an interested party in connection with any pro22 curement that is subject to this section (including any

23 such procurement that is subject to delegation of procure24 ment authority), the board of contract appeals of the Gen-
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1 eral Services Administration (hereafter in this subsection

2 referred to as the ‘board’) shall review, as provided in this

3 subsection, any decision by a contracting officer that is

4 alleged to violate a statute, a regulation, or the conditions

5 of a delegation of procurement authority.’’.

6 SEC. 1433. PERIODS FOR CERTAIN ACTIONS.

7 (a) SUSPENSION OF PROCUREMENT AUTHORITY.—

8 Section 111(f) of the Federal Property and Administrative

9 Services Act of 1949 (40 U.S.C. 759(f)) is amended—

10 (1) in paragraph (2) by adding at the end the

11 following new subparagraph:

12 ‘‘(C) If, in the case of a preaward protest, the board

13 suspends the procurement authority of the Administrator

14 or the Administrator’s delegation of procurement author15 ity, the Administrator or the delegate, as the case may

16 be, may continue with the procurement action up to, but

17 not including, the awarding of the contract if the Adminis18 trator or the delegate, as the case may be, determines that

19 it is in the best interests of the United States to do so.’’;

20 and

21 (2) in paragraph (3) by striking out subpara22 graph (A) and inserting in lieu thereof the following:

23 ‘‘(A)(i) If, with respect to an award of a contract,

24 the board receives notice of a protest under this subsection

25 within the period described in clause (ii), the board shall,
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1 at the request of an interested party, hold a hearing to

2 determine whether the board should suspend the procure3 ment authority of the Administrator or the Administra4 tor’s delegation of procurement authority for the protested

5 procurement on an interim basis until the board can de6 cide the protest.

7 ‘‘(ii) The period referred to in clause (i) is the period

8 beginning on the date on which the contract is awarded

9 and ending on the date that is 10 days after the date of

10 the contract award or, if later, the date that is 5 days

11 after—

12 ‘‘(I) the debriefing date offered to an unsuc13 cessful offeror for any debriefing that is requested

14 and, when requested, is required; or

15 ‘‘(II) in the case of a contract for which no de16 briefing is required, the date on which the unsuc17 cessful offeror receives the notification of contract

18 award.

19 ‘‘(iii) The board shall hold the requested hearing

20 within 5 days after the date of the filing of the protest

21 or, in the case of a request for debriefing under the provi22 sions of section 2305(b)(5) of title 10, United States Code,

23 or section 303B(e) of this Act, within 5 days after the

24 later of the date of the filing of the protest or the date

25 of the debriefing.’’.
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1 (b) FINAL DECISION.—Paragraph (4)(B) of such sec2 tion 111(f) is amended—

3 (1) by striking out ‘‘45 working days’’ and in4 serting in lieu thereof ‘‘65 days’’; and

5 (2) by adding at the end the following: ‘‘An

6 amendment which adds a new ground of protest

7 should be resolved, to the maximum extent prac8 ticable, within the time limits established for resolu9 tion of the initial protest.’’.

10 SEC. 1434. DISMISSALS OF PROTESTS.

11 Section 111(f)(4) of the Federal Property and Ad12 ministrative Services Act of 1949 (40 U.S.C. 759(f)(4))

13 is amended by striking out subparagraph (C) and insert14 ing in lieu thereof the following:

15 ‘‘(C) The board may dismiss a protest that the board

16 determines—

17 ‘‘(i) is frivolous;

18 ‘‘(ii) has been brought in bad faith; or

19 ‘‘(iii) does not state on its face a valid basis for

20 protest.’’.

21 SEC. 1435. AWARD OF COSTS.

22 Section 111(f)(5) is amended by striking out sub23 paragraph (C) and inserting in lieu thereof the following:

24 ‘‘(C) Whenever the board makes such a determina25 tion, it may, in accordance with section 1304 of title 31,
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1 United States Code, further declare an appropriate pre2 vailing party to be entitled to the cost of filing and pursu3 ing the protest (including reasonable attorney’s fees and

4 consultant and expert witness fees), and bid and proposal

5 preparation. However, no party (other than a small busi6 ness concern (within the meaning of section 3(a) of the

7 Small Business Act)) may be declared entitled to costs for

8 consultant and expert witness fees that exceed the rates

9 provided under section 504(b)(1)(A) of title 5, United

10 States Code, for expert witnesses or to costs for attorney’s

11 fees that exceed the rates provided for attorneys under

12 section 504(b)(1)(A) of title 5, United States Code.’’.

13 SEC. 1436. DISMISSAL AGREEMENTS.

14 Section 111(f)(5) of the Federal Property and Ad15 ministrative Services Act of 1949 (40 U.S.C. 759(f)(5))

16 is amended by adding at the end the following new sub17 paragraphs:

18 ‘‘(D) Any agreement that provides for the dismissal

19 of a protest and involves a direct or indirect expenditure

20 of appropriated funds shall be submitted to the board and

21 shall be made a part of the public record (subject to any

22 protective order considered appropriate by the board) be23 fore dismissal of the protest. If a Federal agency is a party

24 to a settlement agreement, the submission of the agree25 ment submitted to the board shall include a memorandum,
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1 signed by the contracting officer concerned, that describes

2 in detail the procurement, the grounds for protest, the

3 Federal Government’s position regarding the grounds for

4 protest, the terms of the settlement, and the agency’s posi5 tion regarding the propriety of the award or proposed

6 award of the contract at issue in the protest.

7 ‘‘(E) Payment of amounts due from an agency under

8 subparagraph (C) or under the terms of a settlement

9 agreement under subparagraph (D) shall be made from

10 the appropriation made by section 1304 of title 31, United

11 States Code, for the payment of judgments. The Federal

12 agency concerned shall reimburse that appropriation ac13 count out of funds available for the procurement.’’.

14 SEC. 1437. JURISDICTION OF DISTRICT COURTS.

15 Section 111(f)(6)(C) of the Federal Property and Ad16 ministrative Services Act of 1949 (40 U.S.C.

17 759(f)(6)(C)) is amended by striking out ‘‘a district court

18 of the United States or’’.

19 SEC. 1438. MATTERS TO BE COVERED IN REGULATIONS.

20 Section 111(f) of the Federal Property and Adminis21 trative Services Act of 1949 (40 U.S.C. 759(f)) is amend22 ed by striking out paragraph (8) and inserting in lieu

23 thereof the following:

24 ‘‘(7)(A) The board shall adopt and issue such rules

25 and procedures as may be necessary to the expeditious dis-
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1 position of protests filed under the authority of this sub2 section.

3 ‘‘(B) The procedures shall provide that, in the com4 putation of any period described in this subsection—

5 ‘‘(i) the day of the act, event, or default from

6 which the designated period of time begins to run

7 not be included; and

8 ‘‘(ii) the last day after such act, event, or de9 fault be included, unless—

10 ‘‘(I) such last day is a Saturday, a Sunday,

11 or a legal holiday; or

12 ‘‘(II) in the case of a filing of a paper at

13 the board, such last day is a day on which

14 weather or other conditions cause the closing of

15 the board or Federal agency, in which event the

16 next day that is not a Saturday, Sunday, or

17 legal holiday shall be included.

18 ‘‘(C) The procedures may provide for electronic filing

19 and dissemination of documents and information required

20 under this subsection and in so providing shall consider

21 the ability of all parties to achieve electronic access to such

22 documents and records.

23 ‘‘(D) The procedures shall provide that if the board

24 expressly finds that a protest or a portion of a protest

25 is frivolous or has not been brought or pursued in good
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1 faith, or that any person has willfully abused the board’s

2 process during the course of a protest, the board may im3 pose appropriate procedural sanctions, including dismissal

4 of the protest.’’.

5 SEC. 1439. DEFINITIONS.

6 (a) PROTEST.—Section 111(f)(9)(A) of the Federal

7 Property and Administrative Services Act of 1949 (40

8 U.S.C. 759(f)(9)(A)) is amended to read as follows:

9 ‘‘(A) the term ‘protest’ means a written objec10 tion by an interested party—

11 ‘‘(i) to a solicitation or other request by a

12 Federal agency for offers for a contract for the

13 procurement of property or services;

14 ‘‘(ii) to the cancellation of such a solicita15 tion or other request;

16 ‘‘(iii) to an award or proposed award of

17 such a contract; or

18 ‘‘(iv) to a termination or cancellation of an

19 award of such a contract, if the written objec20 tion contains an allegation that the termination

21 or cancellation is based in whole or in part on

22 improprieties concerning the award of the con23 tract;’’.

24 (b) PREVAILING PARTY.—Section 111(f)(9) of such

25 Act is amended—
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1 (1) by striking out ‘‘and’’ at the end of sub2 paragraph (A);

3 (2) by striking out the period at the end of sub4 paragraph (B) and inserting in lieu thereof ‘‘; and’’;

5 and

6 (3) by adding at the end the following new sub7 paragraph:

8 ‘‘(C) the term ‘prevailing party’, with respect to

9 a determination of the board under paragraph

10 (5)(B) that a challenged action of a Federal agency

11 violates a statute or regulation or the conditions of

12 a delegation of procurement authority issued pursu13 ant to this section, means a party that demonstrated

14 such violation.’’.

15 Subtitle E—Definitions and Other

16 Matters

17 PART I—ARMED SERVICES ACQUISITIONS

18 SEC. 1501. DEFINITIONS.

19 Section 2302 of title 10, United States Code, is

20 amended—

21 (1) by striking out paragraphs (3), (4), (5), and

22 (7);

23 (2) by redesignating paragraph (6) as para24 graph (5); and
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1 (3) by inserting after paragraph (2) the follow2 ing:

3 ‘‘(3) The terms ‘commercial item’, ‘commercial

4 component’, ‘full and open competition’, ‘major sys5 tem’, ‘nondevelopmental item’, ‘procurement’, ‘pro6 curement system’, ‘responsible source’, ‘standards’,

7 and ‘technical data’, have the meanings given such

8 terms in section 4 of the Office of Federal Procure9 ment Policy Act (41 U.S.C. 403).

10 ‘‘(4) The term ‘simplified acquisition threshold’

11 has the meaning given that term in section 4 of the

12 Office of Federal Procurement Policy Act (41 U.S.C.

13 403), except that, in the case of any contract to be

14 awarded and performed, or purchase to be made,

15 outside the United States in support of a contin16 gency operation, the term means an amount equal to

17 two times the amount specified for that term in sec18 tion 4 of such Act.’’.

19 SEC. 1502. DELEGATION OF PROCUREMENT FUNCTIONS.

20 (a) CONSOLIDATION OF DELEGATION AUTHORITY.—

21 Section 2311 of title 10, United States Code, is amended

22 to read as follows:

23 ‘‘§ 2311. Delegation

24 ‘‘(a) IN GENERAL.—Except to the extent expressly

25 prohibited by another provision of law, the head of an
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1 agency may delegate, subject to his direction, to any other

2 officer or official of that agency, any power under this

3 chapter.

4 ‘‘(b) PROCUREMENTS FOR OR WITH OTHER AGEN5 CIES.—Subject to subsection (a), to facilitate the procure6 ment of property and services covered by this chapter by

7 each agency named in section 2303 of this title for any

8 other agency, and to facilitate joint procurement by those

9 agencies—

10 ‘‘(1) the head of an agency may, within his

11 agency, delegate functions and assign responsibilities

12 relating to procurement;

13 ‘‘(2) the heads of two or more agencies may by

14 agreement delegate procurement functions and as15 sign procurement responsibilities from one agency to

16 another of those agencies or to an officer or civilian

17 employee of another of those agencies; and

18 ‘‘(3) the heads of two or more agencies may

19 create joint or combined offices to exercise procure20 ment functions and responsibilities.

21 ‘‘(c) APPROVAL OF TERMINATIONS AND REDUCTIONS

22 OF JOINT ACQUISITION PROGRAMS.—(1) The Secretary

23 of Defense shall prescribe regulations that prohibit each

24 military department participating in a joint acquisition

25 program approved by the Under Secretary of Defense for
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1 Acquisition and Technology from terminating or substan2 tially reducing its participation in such program without

3 the approval of the Under Secretary.

4 ‘‘(2) The regulations shall include the following provi5 sions:

6 ‘‘(A) A requirement that, before any such ter7 mination or substantial reduction in participation is

8 approved, the proposed termination or reduction be

9 reviewed by the Joint Requirements Oversight Coun10 cil of the Department of Defense.

11 ‘‘(B) A provision that authorizes the Under

12 Secretary of Defense for Acquisition and Technology

13 to require a military department approved for termi14 nation or substantial reduction in participation in a

15 joint acquisition program to continue to provide

16 some or all of the funding necessary for the acquisi17 tion program to be continued in an efficient man18 ner.’’.

19 (b) CONFORMING REPEAL.—(1) Section 2308 of title

20 10, United States Code, is repealed.

21 (2) The table of sections at the beginning of chapter

22 137 of such title is amended by striking out the item relat23 ed to section 2308.
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1 SEC. 1503. DETERMINATIONS AND DECISIONS.

2 Section 2310 of title 10, United States Code, is

3 amended to read as follows:

4 ‘‘§ 2310. Determinations and decisions

5 ‘‘(a) INDIVIDUAL OR CLASS DETERMINATIONS AND

6 DECISIONS AUTHORIZED.—Determinations and decisions

7 required to be made under this chapter by the head of

8 an agency may be made for an individual purchase or con9 tract or for a class of purchases or contracts. Such deter10 minations and decisions are final.

11 ‘‘(b) WRITTEN FINDINGS REQUIRED.—(1) Each de12 termination or decision under section 2306(e)(1), 2307(e),

13 or 2313(d)(2) of this title shall be based on a written find14 ing by the person making the determination or decision.

15 The finding shall set out facts and circumstances that sup16 port the determination or decision.

17 ‘‘(2) Each finding referred to in paragraph (1) shall

18 be final. The head of the agency making such finding shall

19 maintain a copy of the finding for not less than 6 years

20 after the date of the determination or decision.’’.

21 SEC. 1504. UNDEFINITIZED CONTRACTUAL ACTIONS: RE22 STRICTIONS.

23 (a) CLARIFICATION OF LIMITATION.—Subsection (b)

24 of section 2326 of title 10, United States Code, is amend25 ed—
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1 (1) in the subsection caption, by striking out

2 ‘‘AND EXPENDITURE’’;

3 (2) in paragraph (1)(B), by striking out ‘‘or ex4 pended’’;

5 (3) in paragraph (2), by striking out ‘‘expend’’

6 and inserting in lieu thereof ‘‘obligate’’; and

7 (4) in paragraph (3)—

8 (A) by striking out ‘‘expended’’ and insert9 ing in lieu thereof ‘‘obligated’’; and

10 (B) by striking out ‘‘expend’’ and inserting

11 in lieu thereof ‘‘obligate’’.

12 (b) WAIVER AUTHORITY.—Such subsection is amend13 ed—

14 (1) by redesignating paragraph (4) as para15 graph (5); and

16 (2) by inserting after paragraph (3) the follow17 ing new paragraph (4):

18 ‘‘(4) The head of an agency may waive the provisions

19 of this subsection with respect to a contract of that agency

20 if such head of an agency determines that the waiver is

21 necessary in order to support a contingency operation.’’.

22 (c) INAPPLICABILITY OF RESTRICTIONS TO CON23 TRACTS WITHIN THE SIMPLIFIED ACQUISITION THRESH24 OLD.—Section 2326(g)(1)(B) of title 10, United States

25 Code, is amended by striking out ‘‘small purchase thresh-
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1 old’’ and inserting in lieu thereof ‘‘simplified acquisition

2 threshold’’.

3 SEC. 1505. PRODUCTION SPECIAL TOOLING AND PRODUC4 TION SPECIAL TEST EQUIPMENT: CONTRACT

5 TERMS AND CONDITIONS.

6 (a) REPEAL.—Section 2329 of title 10, United States

7 Code, is repealed.

8 (b) TECHNICAL AMENDMENT.—The table of sections

9 at the beginning of chapter 137 of such title is amended

10 by striking out the item related to section 2329.

11 SEC. 1506. REGULATIONS FOR BIDS.

12 Section 2381(a) of title 10, United States Code, is

13 amended by striking out ‘‘(a) The Secretary’’ and all that

14 follows through the end of paragraph (1) and inserting

15 in lieu thereof the following:

16 ‘‘(a) The Secretary of Defense or the Secretary of

17 a military department may—

18 ‘‘(1) prescribe regulations for the preparation,

19 submission, and opening of bids for contracts; and’’.

20 PART II—CIVILIAN AGENCY ACQUISITIONS

21 SEC. 1551. DEFINITIONS.

22 Section 309(c) of the Federal Property and Adminis23 trative Services Act of 1949 (41 U.S.C. 259(c)) is amend24 ed by striking out ‘‘and ‘supplies’ ’’ and inserting in lieu

25 thereof ‘‘ ‘supplies’, ‘commercial item’, ‘commercial compo-
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1 nent’, ‘nondevelopmental item’, and ‘simplified acquisition

2 threshold’ ’’.

3 SEC. 1552. DELEGATION OF PROCUREMENT FUNCTIONS.

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

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

6 et seq.) is amended—

7 (1) by redesignating sections 309 and 310 as

8 sections 312 and 313, respectively; and

9 (2) by inserting after section 308 the following

10 new section 309:

11 ‘‘DELEGATION

12 ‘‘SEC. 309. (a) IN GENERAL.—Except to the extent

13 expressly prohibited by another provision of law, an agen14 cy head may delegate, subject to his direction, to any other

15 officer or official of that agency, any power under this

16 title.

17 ‘‘(b) PROCUREMENTS FOR OR WITH OTHER AGEN18 CIES.—Subject to subsection (a), to facilitate the procure19 ment of property and services covered by this title by each

20 executive agency for any other executive agency, and to

21 facilitate joint procurement by those executive agencies—

22 ‘‘(1) an agency head may, within his executive

23 agency, delegate functions and assign responsibilities

24 relating to procurement;

25 ‘‘(2) the heads of two or more executive agen26 cies may by agreement delegate procurement func-
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1 tions and assign procurement responsibilities from

2 one executive agency to another of those executive

3 agencies or to an officer or civilian employee of an4 other of those executive agencies; and

5 ‘‘(3) the heads of two or more executive agen6 cies may create joint or combined offices to exercise

7 procurement functions and responsibilities.’’.

8 (b) CLERICAL AMENDMENT.—The table of contents

9 in the first section of such Act is amended by striking out

10 the items relating to sections 309 and 310 and inserting

11 in lieu thereof the following:

‘‘Sec. 309. Delegation.

‘‘Sec. 312. Definitions.

‘‘Sec. 313. Statutes not applicable.’’.

12 SEC. 1553. DETERMINATIONS AND DECISIONS.

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

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

15 et seq.), as amended by section 1552, is further amended

16 by inserting after section 309 the following new section

17 310:

18 ‘‘DETERMINATIONS AND DECISIONS

19 ‘‘SEC. 310. (a) INDIVIDUAL OR CLASS DETERMINA20 TIONS AND DECISIONS AUTHORIZED.—Determinations

21 and decisions required to be made under this title by an

22 agency head may be made for an individual purchase or

23 contract or for a class of purchases or contracts. Such de24 terminations and decisions are final.
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1 ‘‘(b) WRITTEN FINDINGS REQUIRED.—(1) Each de2 termination under section 305(e) shall be based on a writ3 ten finding by the person making the determination or de4 cision. The finding shall set out facts and circumstances

5 that support the determination or decision.

6 ‘‘(2) Each finding referred to in paragraph (1) shall

7 be final. The agency head making such finding shall main8 tain a copy of the finding for not less than 6 years after

9 the date of the determination or decision.’’.

10 (b) CLERICAL AMENDMENT.—The table of contents

11 in the first section of such Act, as amended by section

12 1552, is further amended by inserting after the item relat13 ing to section 309 the following:

‘‘Sec. 310. Determinations and decisions.’’.

14 SEC. 1554. COOPERATIVE PURCHASING.

15 Subsection (b) of section 201 of the Federal Property

16 and Administrative Services Act of 1949 (40 U.S.C. 481),

17 is amended to read as follows:

18 ‘‘(b)(1) The Administrator shall, as far as prac19 ticable, provide any of the services specified in subsection

20 (a) of this section to any other Federal agency, mixed21 ownership Government corporation (as defined in section

22 9101 of title 31, United States Code), or the District of

23 Columbia, upon its request.
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1 ‘‘(2)(A) The Administrator may provide for the use

2 of Federal supply schedules or other contracts by any of

3 the following entities upon request:

4 ‘‘(i) A State, any department or agency of a

5 State, and any political subdivision of a State, in6 cluding a local government.

7 ‘‘(ii) The District of Columbia.

8 ‘‘(iii) The Commonwealth of Puerto Rico.

9 ‘‘(iv) The government of an Indian tribe (as de10 fined in section 4(e) of the Indian Self-Determina11 tion and Education Assistance Act (25 U.S.C.

12 450b(e))).

13 ‘‘(B) Subparagraph (A) may not be construed to au14 thorize an entity referred to in that subparagraph to order

15 existing stock or inventory from federally owned and oper16 ated, or federally owned and contractor operated, supply

17 depots, warehouses, or similar facilities.

18 ‘‘(3)(A) Upon the request of a qualified nonprofit

19 agency for the blind or other severely handicapped that

20 is to provide a commodity or service to the Federal Gov21 ernment under the Javits-Wagner-O’Day Act, the Admin22 istrator may provide any of the services specified in sub23 section (a) to such agency to the extent practicable.

24 ‘‘(B) A nonprofit agency receiving services under the

25 authority of subparagraph (A) shall use the services di-
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1 rectly in making or providing an approved commodity or

2 approved service to the Federal Government.

3 ‘‘(C) In this paragraph:

4 ‘‘(i) The term ‘qualified nonprofit agency for

5 the blind or other severely handicapped’ means—

6 ‘‘(I) a qualified nonprofit agency for the

7 blind, as defined in section 5(3) of the Javits8 Wagner-O’Day Act (41 U.S.C. 48b(3)); and

9 ‘‘(II) a qualified nonprofit agency for other

10 severely handicapped, as defined in section 5(4)

11 of such Act (41 U.S.C. 48b(4)).

12 ‘‘(ii) The terms ‘approved commodity’ and ‘ap13 proved service’ mean a commodity and a service, re14 spectively, that has been determined by the Commit15 tee for Purchase from the Blind and Other Severely

16 Handicapped under section 2 of the Javits-Wagner17 O’Day Act (41 U.S.C. 47) to be suitable for pro18 curement by the Federal Government.

19 ‘‘(iii) The term ‘Javits-Wagner-O’Day Act’

20 means the Act entitled ‘An Act to create a Commit21 tee on Purchases of Blind-made Products, and for

22 other purposes’, approved June 25, 1938 (41 U.S.C.

23 46–48c), commonly referred to as the Wagner24 O’Day Act, that was revised and reenacted in the
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1 Act of June 23, 1971 (85 Stat. 77), commonly re2 ferred to as the Javits-Wagner-O’Day Act.’’.

3 TITLE II—CONTRACT

4 ADMINISTRATION

5 Subtitle A—Contract Payment

6 PART I—ARMED SERVICES ACQUISITIONS

7 SEC. 2001. CONTRACT FINANCING.

8 (a) REORGANIZATION OF PRINCIPAL AUTHORITY

9 PROVISION.—Section 2307 of title 10, United States

10 Code, is amended—

11 (1) by striking out the section heading and in12 serting in lieu thereof the following:

13 ‘‘§ 2307. Contract financing’’;

14 (2) by striking out ‘‘(a) The head of an agency’’

15 and inserting in lieu thereof ‘‘(b) PAYMENT AU16 THORITY.—The head of an agency’’;

17 (3) by striking out ‘‘(b) Payments’’ and insert18 ing in lieu thereof ‘‘(d) PAYMENT AMOUNT.—Pay19 ments’’;

20 (4) by striking out ‘‘(c) Advance payments’’ and

21 inserting in lieu thereof ‘‘(e) SECURITY FOR AD22 VANCE PAYMENTS.—Advance payments’’;

23 (5) by striking out ‘‘(d)(1) The Secretary of

24 Defense’’ and inserting in lieu thereof ‘‘(f) CONDI-
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1 TIONS FOR PROGRESS PAYMENTS.—(1) The Sec2 retary of Defense’’; and

3 (6) by striking out ‘‘(e)(1) In any case’’ and in4 serting in lieu thereof ‘‘(h) ACTION IN CASE OF

5 FRAUD.—(1) In any case’’.

6 (b) FINANCING POLICY.—Such section, as amended

7 by subsection (a), is further amended by inserting after

8 the section heading the following new subsection (a):

9 ‘‘(a) POLICY.—Payments authorized under this sec10 tion and made for financing purposes should be made peri11 odically or, when appropriate, on an advance basis and

12 should be so made in a timely manner to facilitate contract

13 performance while protecting the security interests of the

14 Government. Government financing shall be provided only

15 to the extent necessary to ensure prompt and efficient per16 formance and only after the availability of private financ17 ing is considered. A contractor’s use of funds received as

18 contract financing and the contractor’s financial condition

19 shall be monitored. If the contractor is a small business

20 concern, special attention shall be given to meeting the

21 contractor’s financial need.’’.

22 (c) PERFORMANCE-BASED PAYMENTS.—Such sec23 tion, as amended by subsection (a), is further amended

24 by inserting after subsection (b) the following new sub25 section (c):
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1 ‘‘(c) PERFORMANCE-BASED PAYMENTS.—Whenever

2 practicable, payments under subsection (b) shall be made

3 on any of the following bases:

4 ‘‘(1) Performance measured by objective, quan5 tifiable methods such as receipt of items by the Fed6 eral Government, work measurement, or statistical

7 process controls.

8 ‘‘(2) Accomplishment of events defined in the

9 program management plan.

10 ‘‘(3) Other quantifiable measures of results.’’.

11 (d) TERMINOLOGY CORRECTION.—Such section, as

12 amended by subsection (a)(2), is further amended in sub13 section (b)(2) by striking out ‘‘bid’’.

14 (e) EFFECTIVE DATE OF LIEN RELATED TO AD15 VANCE PAYMENTS.—Such section, as amended by sub16 section (a)(4), is further amended in subsection (e) by in17 serting before the period at the end of the third sentence

18 the following: ‘‘and is effective immediately upon the first

19 advancement of funds without filing, notice, or any other

20 action by the United States’’.

21 (f) CONDITIONS FOR PROGRESS PAYMENTS.—Such

22 section, as amended by subsection (a)(5), is further

23 amended in subsection (f)—

24 (1) in the first sentence of paragraph (1), by

25 striking out ‘‘work, which’’ and all that follows
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1 through ‘‘accomplished’’ and inserting in lieu thereof

2 ‘‘work accomplished that meets standards estab3 lished under the contract’’; and

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

5 in lieu thereof the following:

6 ‘‘(3) This subsection applies to a contract for an

7 amount equal to or greater than the simplified acquisition

8 threshold.’’.

9 (g) NAVY CONTRACTS.—Such section, as amended by

10 subsection (a)(5), is further amended by inserting after

11 subsection (f) the following new subsection (g):

12 ‘‘(g) CERTAIN NAVY CONTRACTS.—(1) The Sec13 retary of the Navy shall provide that the rate for progress

14 payments on any contract awarded by the Secretary for

15 repair, maintenance, or overhaul of a naval vessel shall

16 be not less than—

17 ‘‘(A) 95 percent, in the case of firms considered

18 to be small businesses; and

19 ‘‘(B) 90 percent, in the case of all other firms.

20 ‘‘(2) The Secretary of the Navy may advance to pri21 vate salvage companies such funds as the Secretary con22 siders necessary to provide for the immediate financing

23 of salvage operations. Advances under this paragraph shall

24 be made on terms that the Secretary considers adequate

25 for the protection of the United States.
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1 ‘‘(3) The Secretary of the Navy shall ensure that,

2 when partial, progress, or other payments are made under

3 a contract for construction or conversion of a naval vessel,

4 the United States is secured by a lien upon work in

5 progress and on property acquired for performance of the

6 contract on account of all payments so made. The lien is

7 paramount to all other liens.’’.

8 (h) RELATIONSHIP TO PROMPT PAYMENT REQUIRE9 MENTS.—Section 2307(f) of title 10, United States Code,

10 as amended by subsection (f), is not intended to impair

11 or modify procedures required by the provisions of chapter

12 39 of title 31, United States Code, and the regulations

13 issued pursuant to such provisions of law, that relate to

14 progress payment requests, as such procedures are in ef15 fect on the date of the enactment of this Act.

16 (i) CONFORMING AND CLERICAL AMENDMENTS.—

17 (1) CROSS REFERENCE.—Such section, as

18 amended by subsection (a), is further amended in

19 subsections (d) and (e) by striking out ‘‘subsection

20 (a)’’ and inserting in lieu thereof ‘‘subsection (b)’’.

21 (2) TABLE OF CONTENTS.—The table of sec22 tions at the beginning of chapter 137 of title 10,

23 United States Code, is amended by striking out the

24 item relating to section 2307 and inserting in lieu

25 thereof the following:

‘‘2307. Contract financing.’’.
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1 (j) REPEAL OF SUPERSEDED PROVISIONS.—

2 (1) PROGRESS PAYMENTS UNDER CERTAIN

3 NAVY CONTRACTS.—

4 (A) REPEAL.—Section 7312 of title 10,

5 United States Code, is repealed.

6 (B) CLERICAL AMENDMENT.—The table of

7 sections at the beginning of chapter 633 of such

8 title is amended by striking out the item relat9 ing to section 7312.

10 (2) ADVANCEMENT OF PAYMENTS FOR NAVY

11 SALVAGE OPERATIONS.—

12 (A) REPEAL.—Section 7364 of such title is

13 repealed.

14 (B) CLERICAL AMENDMENT.—The table of

15 sections at the beginning of chapter 637 of such

16 title is amended by striking out the item relat17 ing to section 7364.

18 (3) PARTIAL PAYMENTS UNDER NAVY CON19 TRACTS.—

20 (A) REPEAL.—Section 7521 of such title is

21 repealed.

22 (B) CLERICAL AMENDMENT.—The table of

23 sections at the beginning of chapter 645 of such

24 title is amended by striking out the item relat25 ing to section 7521.
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1 SEC. 2002. CONTRACTS: VOUCHERING PROCEDURES.

2 (a) REPEAL.—Section 2355 of title 10, United States

3 Code, is repealed.

4 (b) CLERICAL AMENDMENT.—The table of sections

5 at the beginning of chapter 139 of such title is amended

6 by striking out the item relating to section 2355.

7 PART II—CIVILIAN AGENCY ACQUISITIONS

8 SEC. 2051. CONTRACT FINANCING.

9 (a) REORGANIZATION OF PRINCIPAL AUTHORITY

10 PROVISION.—Section 305 of the Federal Property and

11 Administrative Services Act of 1949 (41 U.S.C. 255) is

12 amended—

13 (1) by striking out the section heading and in14 serting in lieu thereof the following:

15 ‘‘CONTRACT FINANCING’’;

16 (2) by striking out ‘‘(a) Any executive agency’’

17 and inserting in lieu thereof ‘‘(b) PAYMENT AU18 THORITY.—Any executive agency’’;

19 (3) by striking out ‘‘(b) Payments’’ and insert20 ing in lieu thereof ‘‘(d) PAYMENT AMOUNT.—Pay21 ments’’; and

22 (4) by striking out ‘‘(c) Advance payments’’ and

23 inserting in lieu thereof ‘‘(e) SECURITY FOR AD24 VANCE PAYMENTS.—Advance payments’’.
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1 (b) FINANCING POLICY.—Such section, as amended

2 by subsection (a), is further amended by inserting after

3 the section heading the following new subsection (a):

4 ‘‘(a) POLICY.—Payments authorized under this sec5 tion and made for financing purposes should be made peri6 odically or, when appropriate, on an advance basis and

7 should be so made in a timely manner to facilitate contract

8 performance while protecting the security interests of the

9 Government. Government financing shall be provided only

10 to the extent necessary to ensure prompt and efficient per11 formance and only after the availability of private financ12 ing is considered. A contractor’s use of funds received as

13 contract financing and the contractor’s financial condition

14 shall be monitored. If the contractor is a small business

15 concern, special attention shall be given to meeting the

16 contractor’s financial need.’’.

17 (c) PERFORMANCE-BASED PAYMENTS.—Such sec18 tion, as amended by subsection (a), is further amended

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

21 ‘‘(c) PERFORMANCE-BASED PAYMENTS.—Whenever

22 practicable, payments under subsection (b) shall be made

23 on any of the following bases:

24 ‘‘(1) Performance measured by objective, quan25 tifiable methods such as receipt of items by the Fed-
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1 eral Government, work measurement, or statistical

2 process controls.

3 ‘‘(2) Accomplishment of events defined in the

4 program management plan.

5 ‘‘(3) Other quantifiable measures of results.’’.

6 (d) TERMINOLOGY CORRECTION.—Such section, as

7 amended by subsection (a)(2), is further amended in sub8 section (b)(2) by striking out ‘‘bid’’.

9 (e) EFFECTIVE DATE OF LIEN RELATED TO AD10 VANCE PAYMENTS.—Such section, as amended by sub11 section (a)(4), is further amended in subsection (e) by in12 serting before the period at the end of the third sentence

13 the following: ‘‘and is effective immediately upon the first

14 advancement of funds without filing, notice, or any other

15 action by the United States’’.

16 (f) REVISION OF CIVILIAN AGENCY PROVISION TO

17 ENSURE UNIFORM REQUIREMENTS FOR PROGRESS PAY18 MENTS.—

19 (1) IN GENERAL.—Such section, as amended by

20 subsection (a), is further amended by adding at the

21 end the following:

22 ‘‘(f) CONDITIONS FOR PROGRESS PAYMENTS.—(1)

23 The agency head shall ensure that any payment for work

24 in progress (including materials, labor, and other items)

25 under a contract of an executive agency that provides for
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1 such payments is commensurate with the work accom2 plished that meets standards established under the con3 tract. The contractor shall provide such information and

4 evidence as the agency head determines necessary to per5 mit the agency head to carry out the preceding sentence.

6 ‘‘(2) The agency head shall ensure that progress pay7 ments referred to in paragraph (1) are not made for more

8 than 80 percent of the work accomplished under the con9 tract so long as the agency head has not made the contrac10 tual terms, specifications, and price definite.

11 ‘‘(3) This subsection applies to a contract for an

12 amount equal to or greater than the simplified acquisition

13 threshold.

14 ‘‘(g) ACTION IN CASE OF FRAUD.—(1) In any case

15 in which the remedy coordination official of an executive

16 agency finds that there is substantial evidence that the

17 request of a contractor for advance, partial, or progress

18 payment under a contract awarded by that executive agen19 cy is based on fraud, the remedy coordination official shall

20 recommend that the agency head reduce or suspend fur21 ther payments to such contractor.

22 ‘‘(2) An agency head receiving a recommendation

23 under paragraph (1) in the case of a contractor’s request

24 for payment under a contract shall determine whether

25 there is substantial evidence that the request is based on
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1 fraud. Upon making such a determination, the agency

2 head may reduce or suspend further payments to the con3 tractor under such contract.

4 ‘‘(3) The extent of any reduction or suspension of

5 payments by an agency head under paragraph (2) on the

6 basis of fraud shall be reasonably commensurate with the

7 anticipated loss to the United States resulting from the

8 fraud.

9 ‘‘(4) A written justification for each decision of the

10 agency head whether to reduce or suspend payments

11 under paragraph (2), and for each recommendation re12 ceived by the agency head in connection with such deci13 sion, shall be prepared and be retained in the files of the

14 executive agency.

15 ‘‘(5) Each agency head shall prescribe procedures to

16 ensure that, before the agency head decides to reduce or

17 suspend payments in the case of a contractor under para18 graph (2), the contractor is afforded notice of the pro19 posed reduction or suspension and an opportunity to sub20 mit matters to the head of the agency in response to such

21 proposed reduction or suspension.

22 ‘‘(6) Not later than 180 days after the date on which

23 an agency head reduces or suspends payments to a con24 tractor under paragraph (2), the remedy coordination offi25 cial of the executive agency shall—
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1 ‘‘(A) review the determination of fraud on

2 which the reduction or suspension is based; and

3 ‘‘(B) transmit a recommendation to the agency

4 head whether the suspension or reduction should

5 continue.

6 ‘‘(7) Each agency head who receives recommenda7 tions made by a remedy coordination official of the execu8 tive agency to reduce or suspend payments under para9 graph (2) during a fiscal year shall prepare for such year

10 a report that contains the recommendations, the actions

11 taken on the recommendations and the reasons for such

12 actions, and an assessment of the effects of such actions

13 on the Federal Government. Any such report shall be

14 available to any Member of Congress upon request.

15 ‘‘(8) An agency head may not delegate responsibilities

16 under this subsection to any person in a position below

17 level IV of the Executive Schedule.

18 ‘‘(9) In this subsection, the term ‘remedy coordina19 tion official’, with respect to an executive agency, means

20 the person or entity in that executive agency who coordi21 nates within that executive agency the administration of

22 criminal, civil, administrative, and contractual remedies

23 resulting from investigations of fraud or corruption related

24 to procurement activities.’’.
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1 (2) RELATIONSHIP TO PROMPT PAYMENT RE2 QUIREMENTS.—The amendment made by paragraph

3 (1) is 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 pur6 suant to such provisions of law, that relate to

7 progress payment requests, as such procedures are

8 in effect on 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,

12 as amended by subsection (a), is further amended in

13 subsections (d) and (e) by striking out ‘‘subsection

14 (a)’’ and inserting in lieu thereof ‘‘subsection (b)’’.

15 (2) TABLE OF CONTENTS.—The table of con16 tents in the first section of such Act is amended by

17 striking out the item relating to section 305 and in18 serting in 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) UNALLOWABILITY OF COSTS TO INFLUENCE

23 LOCAL LEGISLATIVE BODIES.—Subsection (e)(1)(B) of

24 section 2324 of title 10, United States Code, is amended

25 by striking out ‘‘or a State legislature’’ and inserting in
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1 lieu thereof ‘‘, a State legislature, or a legislative body of

2 a political subdivision of a State’’.

3 (b) COMPTROLLER GENERAL EVALUATION.—Section

4 2324 of such title is amended by striking out subsection

5 (l).

6 (c) COVERED CONTRACT DEFINED.—Subsection (m)

7 of such section is amended to read as follows:

8 ‘‘(l)(1) In this section, the term ‘covered contract’

9 means a contract for an amount in excess of $500,000

10 that is entered into by the Department of Defense, except

11 that such term does not include a fixed-price contract

12 without cost incentives.

13 ‘‘(2) Effective on October 1 of each year that is divis14 ible by 5, the amount set forth in paragraph (1) shall be

15 adjusted to the amount that is equal to the fiscal year

16 1994 constant dollar value of the amount set forth. An

17 amount, as so adjusted, that is not evenly divisible by

18 $50,000 shall be rounded to the nearest multiple of

19 $50,000. In the case of an amount that is evenly divisible

20 by $25,000 but is not evenly divisible by $50,000, the

21 amount shall be rounded to the next higher multiple of

22 $50,000.’’.
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1 SEC. 2102. CONTRACT PROFIT CONTROLS DURING EMER2 GENCY PERIODS.

3 (a) REPEAL.—Section 2382 of title 10, United States

4 Code, is repealed.

5 (b) CLERICAL AMENDMENT.—The table of sections

6 at the beginning of chapter 141 of such title is amended

7 by striking out the item relating to section 2382.

8 PART II—CIVILIAN AGENCY ACQUISITIONS

9 SEC. 2151. ALLOWABLE CONTRACT COSTS.

10 (a) REVISION OF CIVILIAN AGENCY PROVISION TO

11 ENSURE UNIFORM TREATMENT OF CONTRACT COSTS.—

12 Section 306 of the Federal Property and Administrative

13 Services Act of 1949 (41 U.S.C. 256) is amended to read

14 as follows:

15 ‘‘ALLOWABLE COSTS

16 ‘‘SEC. 306. (a) INDIRECT COST THAT VIOLATES A

17 FAR COST PRINCIPLE.—The head of an executive agency

18 shall require that a covered contract provide that if the

19 contractor submits to the executive agency a proposal for

20 settlement of indirect costs incurred by the contractor for

21 any period after such costs have been accrued and if that

22 proposal includes the submission of a cost which is unal23 lowable because the cost violates a cost principle in the

24 Federal Acquisition Regulation or an executive agency’s

25 supplement to the Federal Acquisition Regulation, the cost

26 shall be disallowed.
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1 ‘‘(b) PENALTY FOR VIOLATION OF COST PRIN2 CIPLE.—(1) If the agency head determines that a cost

3 submitted by a contractor in its proposal for settlement

4 is expressly unallowable under a cost principle referred to

5 in subsection (a) that defines the allowability of specific

6 selected costs, the agency head shall assess a penalty

7 against the contractor in an amount equal to—

8 ‘‘(A) the amount of the disallowed cost allo9 cated to covered contracts for which a proposal for

10 settlement of indirect costs has been submitted; plus

11 ‘‘(B) interest (to be computed based on regula12 tions issued by the agency head) to compensate the

13 United States for the use of any funds which a con14 tractor has been paid in excess of the amount to

15 which the contractor was entitled.

16 ‘‘(2) If the agency head determines that a proposal

17 for settlement of indirect costs submitted by a contractor

18 includes a cost determined to be unallowable in the case

19 of such contractor before the submission of such proposal,

20 the agency head shall assess a penalty against the contrac21 tor in an amount equal to two times the amount of the

22 disallowed cost allocated to covered contracts for which a

23 proposal for settlement of indirect costs has been submit24 ted.
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1 ‘‘(c) WAIVER OF PENALTY.—In accordance with the

2 Federal Acquisition Regulation, the agency head may

3 waive a penalty under subsection (b) in the case of a con4 tractor’s proposal for settlement of indirect costs when—

5 ‘‘(1) the contractor withdraws the proposal be6 fore the formal initiation of an audit of the proposal

7 by the Federal Government and resubmits a revised

8 proposal;

9 ‘‘(2) the amount of unallowable costs subject to

10 the penalty is insignificant; or

11 ‘‘(3) the contractor demonstrates, to the con12 tracting officer’s satisfaction, that—

13 ‘‘(A) it has established appropriate policies

14 and personnel training and an internal control

15 and review system that provide assurances that

16 unallowable costs subject to penalties are pre17 cluded from being included in the contractor’s

18 proposal for settlement of indirect costs; and

19 ‘‘(B) the unallowable costs subject to the

20 penalty were inadvertently incorporated into the

21 proposal.

22 ‘‘(d) APPLICABILITY OF CONTRACT DISPUTES PRO23 CEDURE TO DISALLOWANCE OF COST AND ASSESSMENT

24 OF PENALTY.—An action of an agency head under sub25 section (a) or (b)—
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1 ‘‘(1) shall be considered a final decision for the

2 purposes of section 6 of the Contract Disputes Act

3 of 1978 (41 U.S.C. 605); and

4 ‘‘(2) is appealable in the manner provided in

5 section 7 of such Act.

6 ‘‘(e) SPECIFIC COSTS NOT ALLOWABLE.—(1) The

7 following costs are not allowable under a covered contract:

8 ‘‘(A) Costs of entertainment, including amuse9 ment, diversion, and social activities, and any costs

10 directly associated with such costs (such as tickets

11 to shows or sports events, meals, lodging, rentals,

12 transportation, and gratuities).

13 ‘‘(B) Costs incurred to influence (directly or in14 directly) legislative action on any matter pending be15 fore Congress, a State legislature, or a legislative

16 body of a political subdivision of a State.

17 ‘‘(C) Costs incurred in defense of any civil or

18 criminal fraud proceeding or similar proceeding (in19 cluding filing of any false certification) brought by

20 the United States where the contractor is found lia21 ble or had pleaded nolo contendere to a charge of

22 fraud or similar proceeding (including filing of a

23 false certification).

24 ‘‘(D) Payments of fines and penalties resulting

25 from violations of, or failure to comply with, Fed-
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1 eral, State, local, or foreign laws and regulations, ex2 cept when incurred as a result of compliance with

3 specific terms and conditions of the contract or spe4 cific written instructions from the contracting officer

5 authorizing in advance such payments in accordance

6 with the Federal Acquisition Regulation.

7 ‘‘(E) Costs of membership in any social, dining,

8 or country club or organization.

9 ‘‘(F) Costs of alcoholic beverages.

10 ‘‘(G) Contributions or donations, regardless of

11 the recipient.

12 ‘‘(H) Costs of advertising designed to promote

13 the contractor or its products.

14 ‘‘(I) Costs of promotional items and memora15 bilia, including models, gifts, and souvenirs.

16 ‘‘(J) Costs for travel by commercial aircraft

17 which exceed the amount of the standard commercial

18 fare.

19 ‘‘(K) Costs incurred in making any payment

20 (commonly known as a ‘golden parachute payment’)

21 which is—

22 ‘‘(i) in an amount in excess of the normal

23 severance pay paid by the contractor to an em24 ployee upon termination of employment; and
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1 ‘‘(ii) is paid to the employee contingent

2 upon, and following, a change in management

3 control over, or ownership of, the contractor or

4 a substantial portion of the contractor’s assets.

5 ‘‘(L) Costs of commercial insurance that pro6 tects against the costs of the contractor for correc7 tion of the contractor’s own defects in materials or

8 workmanship.

9 ‘‘(M) Costs of severance pay paid by the con10 tractor to foreign nationals employed by the contrac11 tor under a service contract performed outside the

12 United States, to the extent that the amount of sev13 erance pay paid in any case exceeds the amount paid

14 in the industry involved under the customary or pre15 vailing practice for firms in that industry providing

16 similar services in the United States, as determined

17 in accordance with the Federal Acquisition Regula18 tion.

19 ‘‘(N) Costs of severance pay paid by the con20 tractor to a foreign national employed by the con21 tractor under a service contract performed in a for22 eign country if the termination of the employment of

23 the foreign national is the result of the closing of,

24 or the curtailment of activities at, a United States
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1 facility in that country at the request of the govern2 ment of that country.

3 ‘‘(O) Costs incurred by a contractor in connec4 tion with any criminal, civil, or administrative pro5 ceeding commenced by the United States or a State,

6 to the extent provided in subsection (k).

7 ‘‘(2)(A) Subject to the availability of appropriations,

8 the head of an executive agency, in awarding a covered

9 contract, may waive in accordance with the Federal Acqui10 sition Regulation the application of the provisions of para11 graphs (1)(M) and (1)(N) to that contract if the agency

12 head determines that—

13 ‘‘(i) the application of such provisions to the

14 contract would adversely affect the continuation of a

15 program, project, or activity that provides significant

16 support services for employees of the executive agen17 cy posted outside the United States;

18 ‘‘(ii) the contractor has taken (or has estab19 lished plans to take) appropriate actions within the

20 contractor’s control to minimize the amount and

21 number of incidents of the payment of severance pay

22 by the contractor to employees under the contract

23 who are foreign nationals; and

24 ‘‘(iii) the payment of severance pay is necessary

25 in order to comply with a law that is generally appli-
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1 cable to a significant number of businesses in the

2 country in which the foreign national receiving the

3 payment performed services under the contract or is

4 necessary to comply with a collective bargaining

5 agreement.

6 ‘‘(B) The head of the executive agency concerned

7 shall include in the solicitation for a covered contract a

8 statement indicating—

9 ‘‘(i) that a waiver has been granted under sub10 paragraph (A) for the contract; or

11 ‘‘(ii) whether the agency head will consider

12 granting such a waiver, and, if the agency head will

13 consider granting a waiver, the criteria to be used in

14 granting the waiver.

15 ‘‘(C) The agency head shall make the final determina16 tion regarding whether to grant a waiver under subpara17 graph (A) with respect to a covered contract before award

18 of the contract.

19 ‘‘(3) The head of each executive agency shall imple20 ment this section with respect to contracts of that execu21 tive agency in accordance with the Federal Acquisition

22 Regulation. The provisions of the Federal Acquisition ap23 plicable to the implementation of this section may include

24 definitions, exclusions, limitations, and qualifications.
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1 ‘‘(f) REQUIRED REGULATIONS.—(1) The Federal Ac2 quisition Regulation referred to in section 25(c)(1) of the

3 Office of Federal Procurement Policy Act (41 U.S.C.

4 421(c)(1)) shall contain provisions on the allowability of

5 contractor costs. Such provisions shall define in detail and

6 in specific terms those costs which are unallowable, in

7 whole or in part, under covered contracts. The regulations

8 shall, at a minimum, clarify the cost principles applicable

9 to contractor costs of the following:

10 ‘‘(A) Air shows.

11 ‘‘(B) Membership in civic, community, and pro12 fessional organizations.

13 ‘‘(C) Recruitment.

14 ‘‘(D) Employee morale and welfare.

15 ‘‘(E) Actions to influence (directly or indirectly)

16 executive branch action on regulatory and contract

17 matters (other than costs incurred in regard to con18 tract proposals pursuant to solicited or unsolicited

19 bids).

20 ‘‘(F) Community relations.

21 ‘‘(G) Dining facilities.

22 ‘‘(H) Professional and consulting services, in23 cluding legal services.

24 ‘‘(I) Compensation.

25 ‘‘(J) Selling and marketing.
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1 ‘‘(K) Travel.

2 ‘‘(L) Public relations.

3 ‘‘(M) Hotel and meal expenses.

4 ‘‘(N) Expense of corporate aircraft.

5 ‘‘(O) Company-furnished automobiles.

6 ‘‘(P) Advertising.

7 ‘‘(2) The Federal Acquisition Regulation shall require

8 that a contracting officer not resolve any questioned costs

9 until the contracting officer has obtained—

10 ‘‘(A) adequate documentation with respect to

11 such costs; and

12 ‘‘(B) the opinion of the executive agency’s con13 tract auditor on the allowability of such costs.

14 ‘‘(3) The Federal Acquisition Regulation shall pro15 vide that, to the maximum extent practicable, an executive

16 agency’s contract auditor be present at any negotiation or

17 meeting with the contractor regarding a determination of

18 the allowability of indirect costs of the contractor.

19 ‘‘(4) The Federal Acquisition Regulation shall require

20 that all categories of costs designated in the report of an

21 executive agency’s contract auditor as questioned with re22 spect to a proposal for settlement be resolved in such a

23 manner that the amount of the individual questioned costs

24 that are paid will be reflected in the settlement.
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1 ‘‘(g) APPLICABILITY OF REQUIRED REGULATIONS TO

2 SUBCONTRACTORS.—The regulations prescribed to carry

3 out subsections (e) and (f)(1) shall require, to the maxi4 mum extent practicable, that such regulations apply to all

5 subcontractors of a covered contract.

6 ‘‘(h) CONTRACTOR CERTIFICATION REQUIRED.—(1)

7 A proposal for settlement of indirect costs applicable to

8 a covered contract shall include a certification by an offi9 cial of the contractor that, to the best of the certifying

10 official’s knowledge and belief, all indirect costs included

11 in the proposal are allowable. Any such certification shall

12 be in a form prescribed by the agency head concerned.

13 ‘‘(2) The agency head concerned may, in an excep14 tional case, waive the requirement for certification under

15 paragraph (1) in the case of any contract if the agency

16 head—

17 ‘‘(A) determines in such case that it would be

18 in the interest of the United States to waive such

19 certification; and

20 ‘‘(B) states in writing the reasons for that de21 termination and makes such determination available

22 to the public.

23 ‘‘(i) PENALTIES FOR SUBMISSION OF COST KNOWN

24 AS NOT ALLOWABLE.—The submission to an executive

25 agency of a proposal for settlement of costs for any period
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1 after such costs have been accrued that includes a cost

2 that is expressly specified by statute or regulation as being

3 unallowable, with the knowledge that such cost is unallow4 able, shall be subject to the provisions of section 287 of

5 title 18, United States Code, and section 3729 of title 31,

6 United States Code.

7 ‘‘(j) CONTRACTOR TO HAVE BURDEN OF PROOF.—

8 In a proceeding before a board of contract appeals, the

9 United States Court of Federal Claims, or any other Fed10 eral court in which the reasonableness of indirect costs for

11 which a contractor seeks reimbursement from the United

12 States is in issue, the burden of proof shall be upon the

13 contractor to establish that those costs are reasonable.

14 ‘‘(k) PROCEEDING COSTS NOT ALLOWABLE.—(1)

15 Except as otherwise provided in this subsection, costs in16 curred by a contractor in connection with any criminal,

17 civil, or administrative proceeding commenced by the

18 United States or a State are not allowable as reimbursable

19 costs under a covered contract if the proceeding (A) re20 lates to a violation of, or failure to comply with, a Federal

21 or State statute or regulation, and (B) results in a disposi22 tion described in paragraph (2).

23 ‘‘(2) A disposition referred to in paragraph (1)(B) is

24 any of the following:
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1 ‘‘(A) In the case of a criminal proceeding, a

2 conviction (including a conviction pursuant to a plea

3 of nolo contendere) by reason of the violation or fail4 ure referred to in paragraph (1).

5 ‘‘(B) In the case of a civil or administrative

6 proceeding involving an allegation of fraud or similar

7 misconduct, a determination of contractor liability

8 on the basis of the violation or failure referred to in

9 paragraph (1).

10 ‘‘(C) In the case of any civil or administrative

11 proceeding, the imposition of a monetary penalty by

12 reason of the violation or failure referred to in para13 graph (1).

14 ‘‘(D) A final decision—

15 ‘‘(i) to debar or suspend the contractor,

16 ‘‘(ii) to rescind or void the contract, or

17 ‘‘(iii) to terminate the contract for default,

18 by reason of the violation or failure referred to in

19 paragraph (1).

20 ‘‘(E) A disposition of the proceeding by consent

21 or compromise if such action could have resulted in

22 a disposition described in subparagraph (A), (B),

23 (C), or (D).

24 ‘‘(3) In the case of a proceeding referred to in para25 graph (1) that is commenced by the United States and
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1 is resolved by consent or compromise pursuant to an

2 agreement entered into by a contractor and the United

3 States, the costs incurred by the contractor in connection

4 with such proceeding that are otherwise not allowable as

5 reimbursable costs under such paragraph may be allowed

6 to the extent specifically provided in such agreement.

7 ‘‘(4) In the case of a proceeding referred to in para8 graph (1) that is commenced by a State, the agency head

9 that awarded the covered contract involved in the proceed10 ing may allow the costs incurred by the contractor in con11 nection with such proceeding as reimbursable costs if the

12 agency head determines, under regulations prescribed by

13 such agency head, that the costs were incurred as a result

14 of (A) a specific term or condition of the contract, or (B)

15 specific written instructions of the agency.

16 ‘‘(5)(A) Except as provided in subparagraph (C),

17 costs incurred by a contractor in connection with a crimi18 nal, civil, or administrative proceeding commenced by the

19 United States or a State in connection with a covered con20 tract may be allowed as reimbursable costs under the con21 tract if such costs are not disallowable under paragraph

22 (1), but only to the extent provided in subparagraph (B).

23 ‘‘(B)(i) The amount of the costs allowable under sub24 paragraph (A) in any case may not exceed the amount

25 equal to 80 percent of the amount of the costs incurred,
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1 to the extent that such costs are determined to be other2 wise allowable and allocable under the Federal Acquisition

3 Regulations.

4 ‘‘(ii) Regulations issued for the purpose of clause (i)

5 shall provide for appropriate consideration of the complex6 ity of procurement litigation, generally accepted principles

7 governing the award of legal fees in civil actions involving

8 the United States as a party, and such other factors as

9 may be appropriate.

10 ‘‘(C) In the case of a proceeding referred to in sub11 paragraph (A), contractor costs otherwise allowable as re12 imbursable costs under this paragraph are not allowable

13 if (i) such proceeding involves the same contractor mis14 conduct alleged as the basis of another criminal, civil, or

15 administrative proceeding, and (ii) the costs of such other

16 proceeding are not allowable under paragraph (1).

17 ‘‘(6) In this subsection:

18 ‘‘(A) The term ‘proceeding’ includes an inves19 tigation.

20 ‘‘(B) The term ‘costs’, with respect to a pro21 ceeding—

22 ‘‘(i) means all costs incurred by a contrac23 tor, whether before or after the commencement

24 of any such proceeding; and

25 ‘‘(ii) includes—
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1 ‘‘(I) administrative and clerical ex2 penses;

3 ‘‘(II) the cost of legal services, includ4 ing legal services performed by an em5 ployee of the contractor;

6 ‘‘(III) the cost of the services of ac7 countants and consultants retained by the

8 contractor; and

9 ‘‘(IV) the pay of directors, officers,

10 and employees of the contractor for time

11 devoted by such directors, officers, and em12 ployees to such proceeding.

13 ‘‘(C) The term ‘penalty’ does not include res14 titution, reimbursement, or compensatory damages.

15 ‘‘(l) COVERED CONTRACT DEFINED.—(1) In this sec16 tion, the term ‘covered contract’ means a contract for an

17 amount in excess of $500,000 that is entered into by an

18 executive agency, except that such term does not include

19 a fixed-price contract without cost incentives.

20 ‘‘(2) Effective on October 1 of each year that is divis21 ible by 5, the amount set forth in paragraph (1) shall be

22 adjusted to the amount that is equal to the fiscal year

23 1994 constant dollar value of the amount set forth. An

24 amount, as so adjusted, that is not evenly divisible by

25 $50,000 shall be rounded to the nearest multiple of
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1 $50,000. In the case of an amount that is evenly divisible

2 by $25,000 but is not evenly divisible by $50,000, the

3 amount shall be rounded to the next higher multiple of

4 $50,000.’’.

5 (b) CLERICAL AMENDMENT.—The table of contents

6 in the first section of such Act is amended by striking out

7 the item relating to section 306 and inserting in lieu there8 of the following:

‘‘Sec. 306. Allowable costs.’’.

9 PART III—ACQUISITIONS GENERALLY

10 SEC. 2191. TRAVEL EXPENSES OF GOVERNMENT CONTRAC11 TORS.

12 Section 24 of the Office of Federal Procurement Pol13 icy Act (41 U.S.C. 420) is repealed.

14 SEC. 2192. UNALLOWABILITY OF ENTERTAINMENT COSTS

15 UNDER COVERED CONTRACTS.

16 Not later than 90 days after the date of the enact17 ment of this Act, the Federal Acquisition Regulatory

18 Council shall amend the cost principle in the Federal Ac19 quisition Regulation that is set out in section 31.205–14

20 of title 48, Code of Federal Regulations, relating to

21 unallowability of entertainment costs—

22 (1) by inserting in the cost principle a state23 ment that costs made specifically unallowable under

24 that cost principle are not allowable under any other

25 cost principle; and
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1 (2) by striking out ‘‘(but see 31.205–1 and

2 31.205–13)’’.

3 Subtitle C—Audit and Access to

4 Records

5 PART I—ARMED SERVICES ACQUISITIONS

6 SEC. 2201. CONSOLIDATION AND REVISION OF AUTHORITY

7 TO EXAMINE RECORDS OF CONTRACTORS.

8 (a) AUTHORITY.—

9 (1) IN GENERAL.—Section 2313 of title 10,

10 United States Code, is amended to read as follows:

11 ‘‘§ 2313. Examination of records of contractor

12 ‘‘(a) AGENCY AUTHORITY.—The head of an agency,

13 acting through an authorized representative—

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

20 agency under this chapter; 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
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1 (A) or under any combination of such contracts;

2 and

3 ‘‘(2) shall, for the purpose of evaluating the ac4 curacy, completeness, and currency of cost or pricing

5 data required to be submitted pursuant to section

6 2306a of this title with respect to a contract or sub7 contract, have the right to examine all records of the

8 contractor or subcontractor related to—

9 ‘‘(A) the proposal for the contract or sub10 contract;

11 ‘‘(B) the discussions conducted on the pro12 posal;

13 ‘‘(C) pricing of the contract or subcontract;

14 or

15 ‘‘(D) performance of the contract or sub16 contract.

17 ‘‘(b) LIMITATION ON PREAWARD AUDITS RELATING

18 TO INDIRECT COSTS.—The head of an agency may not

19 perform a preaward audit to evaluate proposed indirect

20 costs under any contract, subcontract, or modification to

21 be entered into in accordance with this chapter in any case

22 in which the contracting officer determines that the objec23 tives of the audit can reasonably be met by accepting the

24 results of an audit conducted by any other department or
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1 agency of the Federal Government within one year preced2 ing the date of the contracting officer’s determination.

3 ‘‘(c) SUBPOENA POWER.—(1) The Director of the

4 Defense Contract Audit Agency (or any successor agency)

5 may require by subpoena the production of records of a

6 contractor, access to which is provided to the Secretary

7 of Defense or Secretary of a military department by sub8 section (a).

9 ‘‘(2) Any such subpoena, in the case of contumacy

10 or refusal to obey, shall be enforceable by order of an ap11 propriate United States district court.

12 ‘‘(3) The authority provided by paragraph (1) may

13 not be redelegated.

14 ‘‘(4) The Director (or any successor official) shall

15 submit an annual report to the Secretary of Defense on

16 the exercise of such authority during the preceding year

17 and the reasons why such authority was exercised in any

18 instance. The Secretary shall forward a copy of each such

19 report to the Committees on Armed Services of the Senate

20 and House of Representatives.

21 ‘‘(d) COMPTROLLER GENERAL AUTHORITY.—(1) Ex22 cept as provided in paragraph (2), each contract awarded

23 after using procedures other than sealed bid procedures

24 shall provide that the Comptroller General and his rep25 resentatives are entitled to examine any records of the
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1 contractor, or any of its subcontractors, that directly per2 tain to, and involve transactions relating to, the contract

3 or subcontract.

4 ‘‘(2) Paragraph (1) does not apply to a contract or

5 subcontract with a foreign contractor or foreign sub6 contractor if the head of the agency concerned determines,

7 with the concurrence of the Comptroller General or his

8 designee, that the application of that paragraph to the

9 contract or subcontract would not be in the public interest.

10 However, the concurrence of the Comptroller General or

11 his designee is not required—

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 head of the agency determines,

17 after taking into account the price and availability of

18 the property and services from United States

19 sources, that the public interest would be best served

20 by not applying paragraph (1).

21 ‘‘(3) Paragraph (1) may not be construed to require

22 a contractor or subcontractor to create or maintain any

23 record that the contractor or subcontractor does not main24 tain in the ordinary course of business or pursuant to an25 other provision of law.
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1 ‘‘(e) LIMITATION.—The right of the head of an agen2 cy under subsection (a), and the right of the Comptroller

3 General under subsection (d), with respect to a contract

4 or subcontract shall expire three years after final payment

5 under such contract or subcontract.

6 ‘‘(f) INAPPLICABILITY TO CERTAIN CONTRACTS.—

7 This section is inapplicable with respect to the following

8 contracts:

9 ‘‘(1) Contracts for utility services at rates not

10 exceeding those established to apply uniformly to the

11 public, plus any applicable reasonable connection

12 charge.

13 ‘‘(g) RECORDS DEFINED.—In this section, the term

14 ‘records’ includes books, documents, accounting proce15 dures and practices, and other data, regardless of type and

16 regardless of whether such items are in written form, in

17 the form of computer data, or in any other form.’’.

18 (2) CLERICAL AMENDMENT.—The item relating

19 to such section in the table of sections at the begin20 ning of chapter 137 of title 10, United States Code,

21 is amended to read as follows:

‘‘2313. Examination of records of contractor.’’.

22 (b) REPEAL OF SUPERSEDED PROVISION.—

23 (1) REPEAL.—Section 2406 of title 10, United

24 States Code, is repealed.
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1 (2) CLERICAL AMENDMENT.—The table of sec2 tions at the beginning of chapter 141 of such title

3 is amended by striking out the item relating to sec4 tion 2406.

5 PART II—CIVILIAN AGENCY ACQUISITIONS

6 SEC. 2251. AUTHORITY TO EXAMINE RECORDS OF CON7 TRACTORS.

8 (a) AUTHORITY.—

9 (1) IN GENERAL.—Title III of the Federal

10 Property and Administrative Services Act of 1949

11 (41 U.S.C. 251 et seq.), as amended by section

12 1251(a), is further amended by inserting after sec13 tion 304A the following new section:

14 ‘‘EXAMINATION OF RECORDS OF CONTRACTOR

15 ‘‘SEC. 304B. (a) AGENCY AUTHORITY.—The head of

16 an executive agency, acting through an authorized rep17 resentative—

18 ‘‘(1) is entitled to inspect the plant and audit

19 the records of—

20 ‘‘(A) a contractor performing a cost-reim21 bursement, incentive, time-and-materials, labor22 hour, or price-redeterminable contract, or any

23 combination of such contracts, made by that ex24 ecutive agency under this title; and

25 ‘‘(B) a subcontractor performing any cost26 reimbursement, incentive, time-and-materials,
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1 labor-hour, or price-redeterminable subcontract

2 under a contract referred to in subparagraph

3 (A) or under any combination of such contracts;

4 and

5 ‘‘(2) shall, for the purpose of evaluating the ac6 curacy, completeness, and currency of cost or pricing

7 data required to be submitted pursuant to section

8 304A with respect to a contract or subcontract, have

9 the right to examine all records of the contractor or

10 subcontractor related to—

11 ‘‘(A) the proposal for the contract or sub12 contract;

13 ‘‘(B) the discussions conducted on the pro14 posal;

15 ‘‘(C) pricing of the contract or subcontract;

16 or

17 ‘‘(D) performance of the contract or sub18 contract.

19 ‘‘(b) LIMITATION ON PREAWARD AUDITS RELATING

20 TO INDIRECT COSTS.—The agency head may not perform

21 a preaward audit to evaluate proposed indirect costs under

22 any contract, subcontract, or modification to be entered

23 into in accordance with this title in any case in which the

24 contracting officer determines that the objectives of the

25 audit can reasonably be met by accepting the results of
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1 an audit conducted by any other department or agency

2 of the Federal Government within one year preceding the

3 date of the contracting officer’s determination.

4 ‘‘(c) SUBPOENA POWER.—(1) The agency head may

5 require by subpoena the production of records of a con6 tractor, access to which is provided by subsection (a).

7 ‘‘(2) Any such subpoena, in the case of contumacy

8 or refusal to obey, shall be enforceable by order of an ap9 propriate United States district court.

10 ‘‘(3) The authority provided by paragraph (1) may

11 not be delegated.

12 ‘‘(4) In the year following a year in which the head

13 of an executive agency exercises the authority provided in

14 paragraph (1), the agency head shall submit to the Com15 mittee on Governmental Affairs of the Senate and the

16 Committee on Government Operations of the House of

17 Representatives a report on the exercise of such authority

18 during such preceding year and the reasons why such au19 thority was exercised in any instance.

20 ‘‘(d) COMPTROLLER GENERAL AUTHORITY.—(1) Ex21 cept as provided in paragraph (2), each contract awarded

22 after using procedures other than sealed bid procedures

23 shall provide that the Comptroller General and his rep24 resentatives are entitled to examine any records of the

25 contractor, or any of its subcontractors, that directly per-
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1 tain to, and involve transactions relating to, the contract

2 or subcontract.

3 ‘‘(2) Paragraph (1) does not apply to a contract or

4 subcontract with a foreign contractor or foreign sub5 contractor if the agency head concerned determines, with

6 the concurrence of the Comptroller General or his des7 ignee, that the application of that paragraph to the con8 tract or subcontract would not be in the public interest.

9 However, the concurrence of the Comptroller General or

10 his designee is not required—

11 ‘‘(A) where the contractor or subcontractor is a

12 foreign government or agency thereof or is precluded

13 by the laws of the country involved from making its

14 records available for examination; and

15 ‘‘(B) where the agency head determines, after

16 taking into account the price and availability of the

17 property and services from United States sources,

18 that the public interest would be best served by not

19 applying paragraph (1).

20 ‘‘(3) Paragraph (1) may not be construed to require

21 a contractor or subcontractor to create or maintain any

22 record that the contractor or subcontractor does not main23 tain in the ordinary course of business or pursuant to an24 other provision of law.
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1 ‘‘(e) LIMITATION.—The right of an agency head

2 under subsection (a), and the right of the Comptroller

3 General under subsection (d), with respect to a contract

4 or subcontract shall expire three years after final payment

5 under such contract or subcontract.

6 ‘‘(f) INAPPLICABILITY TO CERTAIN CONTRACTS.—

7 This section is inapplicable with respect to the following

8 contracts:

9 ‘‘(1) CONTRACTS.—For utility services at rates

10 not exceeding those established to apply uniformly to

11 the public, plus any applicable reasonable connection

12 charge.

13 ‘‘(g) RECORDS DEFINED.—In this section, the term

14 ‘records’ includes books, documents, accounting proce15 dures and practices, and other data, regardless of type and

16 regardless of whether such items are in written form, in

17 the form of computer data, or in any other form.’’.

18 (2) CLERICAL AMENDMENT.—The table of con19 tents in the first section of such Act, as amended by

20 section 1251(b), is further amended by inserting

21 after the item relating to section 304A the following:

‘‘Sec. 304B. Examination of records of contractor.’’.

22 (b) REPEAL OF SUPERSEDED PROVISION.—Section

23 304 of the Federal Property and Administrative Services

24 Act of 1949 (41 U.S.C. 254) is amended by striking out

25 subsection (c).
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1 Subtitle D—Cost Accounting

2 Standards

3 SEC. 2301. EXCEPTIONS TO COVERAGE.

4 Section 26(f)(2) of the Office of Federal Procurement

5 Policy Act (41 U.S.C. 422(f)(2)) is amended—

6 (1) by inserting ‘‘(A)’’ after ‘‘(2)’’;

7 (2) by striking out ‘‘, other than contracts or

8 subcontracts’’ and all that follows and inserting in

9 lieu thereof a period; and

10 (3) by inserting at the end the following:

11 ‘‘(B) Subparagraph (A) does not apply to the follow12 ing contracts or subcontracts:

13 ‘‘(i) Contracts or subcontracts where the price

14 negotiated is based on established catalog or market

15 prices of commercial items sold in substantial quan16 tities to the general public.

17 ‘‘(ii) Contracts or subcontracts where the price

18 negotiated is based on prices set by law or regula19 tion.

20 ‘‘(iii) Any other firm fixed-price contract or

21 subcontract for commercial items which is excepted

22 from the requirement to provide cost or pricing data

23 pursuant to subsection (b) or (d) of section 2306a

24 of title 10, United States Code, or subsection (b) or
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1 (d) of section 304A of the Federal Property and Ad2 ministrative Services Act of 1949.

3 ‘‘(C) In this paragraph, the term ‘subcontract’ in4 cludes a transfer of commercial items between divisions,

5 subsidiaries, or affiliates of a contractor.’’.

6 SEC. 2302. REPEAL OF OBSOLETE DEADLINE REGARDING

7 PROCEDURAL REGULATIONS FOR THE COST

8 ACCOUNTING STANDARDS BOARD.

9 Section 26(f)(3) of the Office of Federal Procurement

10 Policy Act (41 U.S.C. 422(f)(3)) is amended in the first

11 sentence by striking out ‘‘Not later than 180 days after

12 the date of the enactment of this section, the Adminis13 trator’’ and inserting in lieu thereof ‘‘The Administrator’’.

14 Subtitle E—Administration of Con15 tract Provisions Relating to

16 Price, Delivery, and Product

17 Quality

18 PART I—ARMED SERVICES ACQUISITIONS

19 SEC. 2401. PROCUREMENT OF CRITICAL AIRCRAFT AND

20 SHIP SPARE PARTS; QUALITY CONTROL.

21 (a) REPEAL.—Section 2383 of title 10, United States

22 Code, is repealed.

23 (b) CLERICAL AMENDMENT.—The table of sections

24 at the beginning of chapter 141 of such title is amended

25 by striking out the item relating to section 2383.
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1 SEC. 2402. CONTRACTOR GUARANTEES REGARDING WEAP2 ON SYSTEMS.

3 Section 2403(h) of title 10, United States Code, is

4 amended—

5 (1) by redesignating paragraph (2) as para6 graph (3); and

7 (2) by inserting after paragraph (1) the follow8 ing new paragraph (2):

9 ‘‘(2) The regulations shall include the following:

10 ‘‘(A) Guidelines for negotiating contractor guar11 antees that are reasonable and cost effective, as de12 termined on the basis of the likelihood of defects and

13 the estimated cost of correcting such defects.

14 ‘‘(B) Procedures for administering contractor

15 guarantees.

16 ‘‘(C) Guidelines for determining the cases in

17 which it may be appropriate to waive the require18 ments of this section.’’.

19 PART II—ACQUISITIONS GENERALLY

20 SEC. 2451. SECTION 3737 OF THE REVISED STATUTES: EX21 PANSION OF AUTHORITY TO PROHIBIT

22 SETOFFS AGAINST ASSIGNEES; REORGANIZA23 TION OF SECTION; REVISION OF OBSOLETE

24 PROVISIONS.

25 Section 3737 of the Revised Statutes (41 U.S.C. 15)

26 is amended to read as follows:
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1 ‘‘SEC. 3737. (a) No contract or order, or any interest

2 therein, shall be transferred by the party to whom such

3 contract or order is given to any other party, and any such

4 transfer shall cause the annulment of the contract or order

5 transferred, so far as the United States is concerned. All

6 rights of action, however, for any breach of such contract

7 by the contracting parties, are reserved to the United

8 States.

9 ‘‘(b) The provisions of subsection (a) shall not apply

10 in any case in which the moneys due or to become due

11 from the United States or from any agency or department

12 thereof, under a contract providing for payments aggre13 gating $1,000 or more, are assigned to a bank, trust com14 pany, or other financing institution, including any Federal

15 lending agency, provided:

16 ‘‘(1) That, in the case of any contract entered

17 into after October 9, 1940, no claim shall be as18 signed if it arises under a contract which forbids

19 such assignment.

20 ‘‘(2) That, unless otherwise expressly permitted

21 by such contract, any such assignment shall cover all

22 amounts payable under such contract and not al23 ready paid, shall not be made to more than one

24 party, and shall not be subject to further assign25 ment, except that any such assignment may be made
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1 to one party as agent or trustee for two or more

2 parties participating in such financing.

3 ‘‘(3) That, in the event of any such assignment,

4 the assignee thereof shall file written notice of the

5 assignment together with a true copy of the instru6 ment of the assignment with—

7 ‘‘(A) the contracting officer or the head of

8 his department or agency;

9 ‘‘(B) the surety or sureties upon the bond

10 or bonds, if any, in connection with such con11 tract; and

12 ‘‘(C) the disbursing officer, if any, des13 ignated in such contract to make payment.

14 ‘‘(c) Notwithstanding any law to the contrary govern15 ing the validity of assignments, any assignment pursuant

16 to this section shall constitute a valid assignment for all

17 purposes.

18 ‘‘(d) In any case in which moneys due or to become

19 due under any contract are or have been assigned pursu20 ant to this section, no liability of any nature of the as21 signor to the United States or any department or agency

22 thereof, whether arising from or independently of such

23 contract, shall create or impose any liability on the part

24 of the assignee to make restitution, refund, or repayment
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1 to the United States of any amount heretofore since July

2 1, 1950, or hereafter received under the assignment.

3 ‘‘(e) Any contract of the Department of Defense, the

4 General Services Administration, the Department of En5 ergy, or any other department or agency of the United

6 States designated by the President, except any such con7 tract under which full payment has been made, may, upon

8 a determination of need by the President, provide or be

9 amended without consideration to provide that payments

10 to be made to the assignee of any moneys due or to become

11 due under such contract shall not be subject to reduction

12 or setoff. Each such determination of need shall be pub13 lished in the Federal Register.

14 ‘‘(f) If a provision described in subsection (e) or a

15 provision to the same general effect has been at any time

16 heretofore or is hereafter included or inserted in any such

17 contract, payments to be made thereafter to an assignee

18 of any moneys due or to become due under such contract

19 shall not be subject to reduction or setoff for any liability

20 of any nature of the assignor to the United States or any

21 department or agency thereof which arises independently

22 of such contract, or hereafter for any liability of the as23 signor on account of—
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1 ‘‘(1) renegotiation under any renegotiation stat2 ute or under any statutory renegotiation article in

3 the contract;

4 ‘‘(2) fines;

5 ‘‘(3) penalties (which term does not include

6 amounts which may be collected or withheld from

7 the assignor in accordance with or for failure to

8 comply with the terms of the contract); or

9 ‘‘(4) taxes, social security contributions, or the

10 withholding or non withholding of taxes or social se11 curity contributions, whether arising from or inde12 pendently of such contract.

13 ‘‘(g) Except as herein otherwise provided, nothing in

14 this section shall be deemed to affect or impair rights of

15 obligations heretofore accrued.’’.

16 SEC. 2452. REPEAL OF REQUIREMENT FOR DEPOSIT OF

17 CONTRACTS WITH GAO.

18 Section 3743 of the Revised Statutes (41 U.S.C. 20)

19 is repealed.

20 Subtitle F—Claims and Disputes

21 PART I—ARMED SERVICES ACQUISITIONS

22 SEC. 2501. CERTIFICATION OF CONTRACT CLAIMS.

23 (a) DOD CERTIFICATION REQUIREMENT IN CON24 FLICT WITH GOVERNMENTWIDE REQUIREMENT.—
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1 (1) INAPPLICABILITY OF REQUIREMENT TO

2 CONTRACT CLAIMS.—Section 2410 of title 10, Unit3 ed States Code, is amended to read as follows:

4 ‘‘§ 2410. Requests for equitable adjustment or other

5 relief: certification

6 ‘‘(a) CERTIFICATION REQUIREMENT.—A request for

7 equitable adjustment to contract terms or request for re8 lief under Public Law 85–804 (50 U.S.C. 1431 et seq.)

9 that exceeds the simplified acquisition threshold may not

10 be paid unless a person authorized to certify the request

11 on behalf of the contractor certifies, at the time the re12 quest is submitted, that—

13 ‘‘(1) the request is made in good faith, and

14 ‘‘(2) the supporting data are accurate and com15 plete to the best of that person’s knowledge and be16 lief.’’.

17 (2) CLERICAL AMENDMENT.—The table of sec18 tions at the beginning of chapter 141 of such title

19 is amended by striking out the item relating to sec20 tion 2410 and inserting in lieu thereof the following:

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

21 (b) RESTRICTION ON LEGISLATIVE PAYMENT OF

22 CLAIMS.—Section 2410 of title 10, United States Code,

23 as amended by subsection (a), is further amended by add24 ing at the end the following new subsection:
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1 ‘‘(b) RESTRICTION ON LEGISLATIVE PAYMENT OF

2 CLAIMS.—In the case of a contract of an agency named

3 in section 2303(a) of this title, no provision of a law en4 acted after September 30, 1994, that directs the payment

5 of a particular claim under such contract, a particular re6 quest for equitable adjustment to any term of such con7 tract, or a particular request for relief under Public Law

8 85–804 (50 U.S.C. 1431 et seq.) regarding such contract

9 may be implemented unless such provision of law—

10 ‘‘(1) specifically refers to this subsection; and

11 ‘‘(2) specifically states that this subsection does

12 not apply with respect to the payment directed by

13 that provision of law.’’.

14 (c) DEFINITION.—Section 2410, as amended by sub15 sections (a) and (b), is further amended by adding at the

16 end the following:

17 ‘‘(c) DEFINITION.—In this section, the term ‘sim18 plified acquisition threshold’ has the meaning given that

19 term in section 2302(4) of this title.’’.

20 (d) REPEAL OF RELATED PROVISIONS.—

21 (1) CERTIFICATION REGULATIONS FOR CON22 TRACT CLAIMS EXCEEDING $100,000.—

23 (A) REPEAL.—Section 2410e of title 10,

24 United States Code, is repealed.
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1 (B) CLERICAL AMENDMENT.—The table of

2 sections at the beginning of chapter 141 of such

3 title is amended by striking out the item relat4 ing to section 2410e.

5 (2) CONFORMING REPEAL.—Section 813(b) of

6 the National Defense Authorization Act for Fiscal

7 Year 1993 (Public Law 102–484, 106 Stat. 2453),

8 is repealed.

9 SEC. 2502. SHIPBUILDING CLAIMS.

10 (a) LIMITATION ON PERIOD FOR SUBMISSION.—

11 (1) INCREASED PERIOD.—Subsection (a) of sec12 tion 2405 of title 10, United States Code, is amend13 ed—

14 (A) by striking out ‘‘after December 7,

15 1983,’’ and inserting in lieu thereof ‘‘on or

16 after the date of the enactment of the Federal

17 Acquisition Streamlining Act of 1994’’; and

18 (B) by striking out ‘‘18 months’’ and in19 serting in lieu thereof ‘‘6 years’’.

20 (2) SAVINGS PROVISION.—Notwithstanding the

21 6-year period provided in subsection (a) of section

22 2405 of title 10, United States Code, as amended by

23 paragraph (1), the period applicable under such sub24 section in the case of a shipbuilding contract entered

25 into after December 7, 1983, and before the date of
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1 the enactment of the Federal Acquisition Streamlin2 ing Act of 1994 shall continue to be 18 months.

3 (b) RESUBMISSION WITH CORRECTED CERTIFI4 CATION.—Subsection (c) of such section is repealed.

5 PART II—ACQUISITIONS GENERALLY

6 SEC. 2551. CLAIMS JURISDICTION OF UNITED STATES DIS7 TRICT COURTS AND THE UNITED STATES

8 COURT OF FEDERAL CLAIMS.

9 (a) CONCURRENT JURISDICTION OF UNITED STATES

10 DISTRICT COURTS UNDER THE LITTLE TUCKER ACT.—

11 Subsection (a) of section 1346 of title 28, United States

12 Code, is amended to read as follows:

13 ‘‘(a)(1) The district courts shall have original juris14 diction, concurrent with the United States Court of Fed15 eral Claims, of any civil action against the United States

16 for the recovery of any internal-revenue tax alleged to have

17 been erroneously or illegally assessed or collected, or any

18 penalty claimed to have been collected without authority

19 or any sum alleged to have been excessive or in any man20 ner wrongfully collected under the internal-revenue laws.

21 ‘‘(2)(A) Except as provided in subparagraph (B), the

22 district courts shall have original jurisdiction, concurrent

23 with the United States Court of Federal Claims, of any

24 other civil action or claim against the United States, not

25 exceeding $10,000 in amount, founded either upon the
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1 Constitution, or any Act of Congress, or any regulation

2 of an executive department, or upon any express or im3 plied contract with the United States, or for liquidated or

4 unliquidated damages in cases not sounding in tort.

5 ‘‘(B) The district courts shall not have jurisdiction

6 over any civil action or claim against the United States

7 or any Federal entity which relates in any manner to a

8 contract to which the Contract Disputes Act of 1978 (41

9 U.S.C. 601 et seq.) applies, including a claim that seeks

10 to establish the existence or nonexistence of such a con11 tract, seeks to establish that such a contract is void, or

12 seeks to determine and construe the terms of such a con13 tract. The district courts do not have jurisdiction over any

14 civil action or claim described in the preceding sentence

15 pursuant to section 1331, 1334, or 1346(a)(2)(B) of this

16 title, any provision of law giving a Federal entity the right

17 to sue or be sued in its own name, or any other provision

18 of law.’’.

19 (b) JURISDICTION OF THE UNITED STATES COURT

20 OF FEDERAL CLAIMS UNDER THE TUCKER ACT.—Sec21 tion 1491 of title 28, United States Code, as amended by

22 section 1422, is further amended by inserting after sub23 section (c) the following:

24 ‘‘(d)(1) The United States Court of Federal Claims

25 shall have jurisdiction over any civil action or claim
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1 against the United States which relates in any manner to

2 a contract to which the Contract Disputes Act of 1978

3 (41 U.S.C. 601 et seq,) applies, including a civil action

4 or claim that seeks to establish the existence or

5 nonexistence of such a contract, seeks to establish that

6 such contract is void, or seeks to determine and construe

7 the terms of any such contract.

8 ‘‘(2) The jurisdiction of the United States Court of

9 Federal Claims is, pursuant to section 1346(a)(2)(B) of

10 this title, exclusive as to the district courts of the United

11 States.’’.

12 SEC. 2552. CONTRACT DISPUTES ACT IMPROVEMENTS.

13 (a) PERIOD FOR FILING CLAIMS.—

14 (1) SIX-YEAR LIMITATION.—Section 6 of the

15 Contract Disputes Act of 1978 (41 U.S.C. 605) is

16 amended in subsection (a) by inserting after the sec17 ond sentence the following: ‘‘Each claim by a con18 tractor against the government relating to a contract

19 and each claim by the government against a contrac20 tor relating to a contract shall be submitted within

21 6 years after the occurrence of the event or events

22 giving rise to the claim. The preceding sentence does

23 not apply to a claim by the government against a

24 contractor that is based on a claim by the contractor

25 involving fraud.’’.
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1 (2) LIMITATION ON APPLICABILITY TO EXIST2 ING CONTRACTS.—Notwithstanding the third sen3 tence of section 6(a) of the Contract Disputes Act

4 of 1978, as added by paragraph (1), if a contract in

5 existence on the date of the enactment of this Act

6 requires that a claim referred to in that sentence be

7 submitted earlier than 6 years after the occurrence

8 of the event or events giving rise to the claim, then

9 the claim shall be submitted within the period re10 quired by the contract. The preceding sentence does

11 not apply to a claim by the Federal Government

12 against a contractor that is based on a claim by the

13 contractor involving fraud.

14 (b) INCREASED THRESHOLD FOR CERTIFICATION,

15 DECISION, AND NOTIFICATION REQUIREMENTS.—Sub16 section (c) of such section is amended by striking out

17 ‘‘$50,000’’ each place it appears and inserting in lieu

18 thereof ‘‘$100,000’’.

19 (c) INCREASED MAXIMUM FOR APPLICABILITY OF

20 ACCELERATED PROCEDURES.—Section 8(f) of the Con21 tract Disputes Act of 1978 (41 U.S.C. 607(f)) is amended

22 by striking out ‘‘$50,000’’ in the first sentence and insert23 ing in lieu thereof ‘‘$150,000’’.

24 (d) INCREASED MAXIMUM FOR APPLICABILITY OF

25 SMALL CLAIMS PROCEDURE.—Section 9(a) of the Con-
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1 tract Disputes Act of 1978 (41 U.S.C. 608(a)) is amended

2 by striking out ‘‘$10,000’’ in the first sentence and insert3 ing in lieu thereof ‘‘$50,000’’.

4 (e) REDUCED PERIOD FOR FILING ACTION IN COURT

5 OF FEDERAL CLAIMS.—Section 10(a)(3) of such Act (41

6 U.S.C. 609(a)(3)) is amended by striking out ‘‘twelve

7 months’’ and inserting in lieu thereof ‘‘90 days’’.

8 SEC. 2553. EXTENSION OF ALTERNATIVE DISPUTE RESOLU9 TION AUTHORITY.

10 (a) EXTENSION OF AUTHORITY.—Section 6(e) of the

11 Contracts Disputes Act of 1978 (41 U.S.C. 605(e)) is

12 amended by striking out ‘‘October 1, 1995’’ and inserting

13 in lieu thereof ‘‘October 1, 1999’’.

14 (b) AVAILABILITY OF PROCEDURES TO SMALL BUSI15 NESS GOVERNMENT CONTRACTORS.—Section 6(e) of such

16 Act is amended by inserting after the first sentence the

17 following: ‘‘In any case in which the contracting officer

18 rejects a contractor’s request for alternative dispute reso19 lution proceedings, the contracting officer shall provide the

20 contractor with a written explanation, citing one or more

21 of the conditions in section 572(b) of title V, United States

22 Code, or such other specific reasons that alternative dis23 pute resolution procedures are inappropriate for the reso24 lution of the dispute. In any case in which a contractor

25 rejects a request of an agency for alternative dispute reso-
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1 lution proceedings, the contractor shall inform the agency

2 in writing of the contractor’s specific reasons for rejecting

3 the request.’’.

4 SEC. 2554. EXPEDITED RESOLUTION OF CONTRACT ADMIN5 ISTRATION COMPLAINTS.

6 (a) REGULATIONS REQUIRED.—The Federal Acquisi7 tion Regulation shall include provisions that require a con8 tracting officer—

9 (1) to make every reasonable effort to respond

10 in writing within 30 days to any written request

11 made to a contracting officer with respect to a mat12 ter relating to the administration of a contract that

13 is received from a small business concern; and

14 (2) in the event that the contracting officer is

15 unable to reply within the 30-day period, to transmit

16 to the contractor within such period a written notifi17 cation of a specific date by which the contracting of18 ficer expects to respond.

19 The provisions shall not apply to a request for a contract20 ing officer’s decision under the Contract Disputes Act of

21 1978 (41 U.S.C. 601 et seq.).

22 (b) RULE OF CONSTRUCTION.—Nothing in this pro23 vision shall be considered as creating any rights under the

24 Contract Disputes Act (41 U.S.C. 601 et seq.).
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1 (c) DEFINITION.—In this section, the term ‘‘small

2 business concern’’ means a business concern that meets

3 the requirements of section 3(a) of the Small Business Act

4 (15 U.S.C. 632(a)) and the regulations promulgated pur5 suant to that section.

6 SEC. 2555. AUTHORITY FOR DISTRICT COURTS TO OBTAIN

7 ADVISORY OPINIONS FROM BOARDS OF CON8 TRACT APPEALS IN CERTAIN CASES.

9 Section 10 of the Contract Disputes Act of 1978 (41

10 U.S.C. 609) is amended by adding at the end the following

11 new paragraph:

12 ‘‘(f)(1) Whenever an action involving an issue de13 scribed in paragraph (2) is pending in a district court of

14 the United States, the district court may request a board

15 of contract appeals to provide the court with an advisory

16 opinion on the matters of contract interpretation at issue.

17 ‘‘(2) An issue referred to in paragraph (1) is any

18 issue that could be the proper subject of a final decision

19 of a contracting officer appealable under this Act.

20 ‘‘(3) A district court shall direct any request under

21 paragraph (1) to the board of contract appeals having ju22 risdiction under this Act to adjudicate appeals of contract

23 claims under the contract or contracts being interpreted

24 by the court.
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1 ‘‘(4) Within ninety days after receiving a request for

2 an advisory opinion under paragraph (1), a board of con3 tract appeals shall provide the advisory opinion to the dis4 trict court making the request.’’.

5 TITLE III—SERVICE SPECIFIC

6 AND MAJOR SYSTEMS STATUTES

7 Subtitle A—Major Systems Statutes

8 SEC. 3001. REQUIREMENT FOR INDEPENDENT COST ESTI9 MATES AND MANPOWER ESTIMATES BEFORE

10 DEVELOPMENT OR PRODUCTION.

11 (a) CONTENT AND SUBMISSION OF ESTIMATES.—

12 Section 2434 of title 10, United States Code, is amended

13 by striking out subsection (b) and inserting in lieu thereof

14 the following:

15 ‘‘(b) REGULATIONS.—The Secretary of Defense shall

16 prescribe regulations governing the content and submis17 sion of the estimates required by subsection (a). The regu18 lations shall require—

19 ‘‘(1) that the independent estimate of the cost

20 of a program—

21 ‘‘(A) be prepared by an office or other en22 tity that is not under the supervision, direction,

23 or control of the military department, Defense

24 Agency, or other component of the Department

25 of Defense that is directly responsible for carry-
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1 ing out the development or acquisition of the

2 program; and

3 ‘‘(B) include all costs of development, pro4 curement, and operations and support, without

5 regard to funding source or management con6 trol; and

7 ‘‘(2) that the manpower estimate include the

8 total personnel required to train for, operate, main9 tain, and support the program upon full operational

10 deployment.’’.

11 (b) TERMINOLOGY CORRECTION.—Subsection (a) of

12 such section is amended by striking out ‘‘full-scale engi13 neering development’’ and inserting in lieu thereof ‘‘engi14 neering and manufacturing development’’.

15 SEC. 3002. ENHANCED PROGRAM STABILITY.

16 (a) BASELINE DESCRIPTIONS AND DEVIATION RE17 PORTING.—Section 2435 of title 10, United States Code,

18 is amended—

19 (1) in subsection (a)—

20 (A) by striking out paragraph (2); and

21 (B) in paragraph (1)—

22 (i) by striking out ‘‘(1)’’; and

23 (ii) by redesignating subparagraphs

24 (A) and (B) as paragraphs (1) and (2), re25 spectively; and
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1 (2) by striking out subsection (b) and inserting

2 in lieu thereof the following:

3 ‘‘(b) REGULATIONS.—The Secretary of Defense shall

4 prescribe regulations governing—

5 ‘‘(1) the content of baseline descriptions, which

6 shall include the program cost, the program sched7 ule, and a program performance description;

8 ‘‘(2) the submission of reports on deviations of

9 a program from the baseline description by the pro10 gram manager to the Secretary of the military de11 partment concerned and the Under Secretary of De12 fense for Acquisition and Technology;

13 ‘‘(3) procedures for review of deviation reports

14 within the Department of Defense; and

15 ‘‘(4) procedures for submission and approval of

16 revised baseline descriptions.

17 ‘‘(c) BASELINE DESCRIPTION REQUIRED BEFORE

18 OBLIGATION OF FUNDS.—(1) Except as provided in para19 graph (2), no amount appropriated or otherwise made

20 available to the Department of Defense may be obligated

21 for a major defense acquisition program before a baseline

22 description for the program is approved in accordance with

23 the procedures prescribed pursuant to subsection (b)(4).
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1 ‘‘(2) An obligation otherwise prohibited by paragraph

2 (1) may be incurred if approved in advance by the Under

3 Secretary of Defense for Acquisition and Technology.’’.

4 (b) TERMINOLOGY CORRECTION.—Subsection (a)(1)

5 of such section, as redesignated by subsection

6 (a)(1)(B)(ii), is amended by striking out ‘‘full-scale engi7 neering development’’ and inserting in lieu thereof ‘‘engi8 neering and manufacturing development’’.

9 SEC. 3003. REPEAL OF REQUIREMENT TO DESIGNATE CER10 TAIN MAJOR DEFENSE ACQUISITION PRO11 GRAMS AS DEFENSE ENTERPRISE PRO12 GRAMS.

13 Section 809 of the National Defense Authorization

14 Act for Fiscal Year 1991 (Public Law 101–510; 10 U.S.C.

15 2430 note) is amended—

16 (1) by striking out subsection (d); and

17 (2) by redesignating subsections (e), (f), (g),

18 and (h) as subsections (d), (e), (f), and (g), respec19 tively.

20 SEC. 3004. REPEAL OF REQUIREMENT FOR COMPETITIVE

21 PROTOTYPING IN MAJOR PROGRAMS.

22 (a) REPEAL.—Section 2438 of title 10, United States

23 Code, is repealed.
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1 (b) CLERICAL AMENDMENT.—The table of sections

2 at the beginning of chapter 144 of such title is amended

3 by striking out the item relating to section 2438.

4 SEC. 3005. REPEAL OF REQUIREMENT FOR COMPETITIVE

5 ALTERNATIVE SOURCES IN MAJOR PRO6 GRAMS.

7 (a) REPEAL.—Section 2439 of title 10, United States

8 Code, is repealed.

9 (b) CLERICAL AMENDMENT.—The table of sections

10 at the beginning of chapter 144 of such title is amended

11 by striking out the item relating to section 2439.

12 Subtitle B—Testing Statutes

13 SEC. 3011. DIRECTOR OF OPERATIONAL TEST AND EVALUA14 TION TO REPORT DIRECTLY TO SECRETARY

15 OF DEFENSE.

16 Section 139(c) of title 10, United States Code, is

17 amended by inserting after ‘‘(c)’’ the following: ‘‘The Di18 rector reports directly, without intervening review or ap19 proval, to the Secretary of Defense and Deputy Secretary

20 of Defense personally.’’.
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1 SEC. 3012. RESPONSIBILITY OF DIRECTOR OF OPER2 ATIONAL TEST AND EVALUATION FOR LIVE

3 FIRE TESTING.

4 (a) CONDUCT OF LIVE FIRE TESTING.—Subsection

5 (b) of section 139 of title 10, United States Code, is

6 amended—

7 (1) by striking out ‘‘and’’ at the end of para8 graph (4);

9 (2) by striking out the period at the end of

10 paragraph (5) and inserting in lieu thereof ‘‘; and’’;

11 and

12 (3) by adding at the end the following new

13 paragraph:

14 ‘‘(6) conduct the live fire testing activities of

15 the Department of Defense provided for under sec16 tion 2366 of this title.’’.

17 (b) ANNUAL REPORT ON LIVE FIRE TESTING.—Sub18 section (f) of such section is amended by inserting ‘‘(in19 cluding live fire testing activities)’’ in the first sentence

20 after ‘‘operational test and evaluation activities’’.

21 SEC. 3013. REQUIREMENT FOR UNCLASSIFIED VERSION OF

22 ANNUAL REPORT ON OPERATIONAL TEST

23 AND EVALUATION.

24 Section 139(f) of title 10, United States Code, is

25 amended by inserting after the second sentence the follow26 ing new sentence: ‘‘If the Director submits the report to
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1 Congress in a classified form, the Director shall concur2 rently submit an unclassified version of the report to Con3 gress.’’.

4 Subtitle C—Service Specific Laws

5 SEC. 3021. GRATUITOUS SERVICES OF OFFICERS OF CER6 TAIN RESERVE COMPONENTS.

7 Section 279 of title 10, United States Code, is

8 amended—

9 (1) by striking out ‘‘Notwithstanding’’ and in10 serting in lieu thereof ‘‘(a) ACCEPTANCE BY SEC11 RETARY OF A MILITARY DEPARTMENT.—Notwith12 standing’’; and

13 (2) by adding at the end the following new sub14 section:

15 ‘‘(b) ACCEPTANCE BY SECRETARY OF DEFENSE.—

16 Notwithstanding section 1342 of title 31, the Secretary

17 of Defense may accept the gratuitous services of an officer

18 of a reserve component (other than an officer of the Army

19 National Guard of the United States or the Air National

20 Guard of the United States) in consultation upon matters

21 relating to the armed forces.’’.

22 SEC. 3022. AUTHORITY TO RENT SAMPLES, DRAWINGS, AND

23 OTHER INFORMATION TO OTHERS.

24 Subchapter V of chapter 148 of title 10, United

25 States Code, is amended in section 2541(a) by inserting
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1 ‘‘rent,’’ after ‘‘sell,’’ each place it appears in paragraphs

2 (1) and (2).

3 SEC. 3023. CIVIL RESERVE AIR FLEET.

4 (a) DEFINITIONS.—Section 9511 of title 10, United

5 States Code, is amended—

6 (1) in paragraph (1)—

7 (A) by inserting ‘‘ ‘civil aircraft’,’’ after

8 ‘‘ ‘person’,’’;

9 (B) by striking out ‘‘meaning’’ and insert10 ing in lieu thereof ‘‘meanings’’; and

11 (C) by striking out ‘‘(49 U.S.C. 1301)’’

12 and inserting in lieu thereof ‘‘(49 U.S.C. App.

13 1301)’’;

14 (2) in paragraph (2), by striking out ‘‘pas15 senger-cargo’’ and inserting in lieu thereof ‘‘pas16 senger cargo’’;

17 (3) in paragraph (3), by striking out ‘‘cargo-ca18 pable’’ and inserting in lieu thereof ‘‘cargo capable’’;

19 (4) by striking out paragraph (5) and inserting

20 in lieu thereof the following:

21 ‘‘(5) The term ‘cargo convertible aircraft’

22 means a passenger aircraft equipped or designed so

23 that all or substantially all of the main deck of the

24 aircraft can be readily converted for the carriage of

25 property or mail.’’;
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1 (5) by striking out paragraph (6);

2 (6) by redesignating paragraph (7) as para3 graph (6);

4 (7) by redesignating paragraph (8) as para5 graph (7) and—

6 (A) in subparagraph (A) of such para7 graph, by inserting ‘‘under section 9512 of this

8 title’’ after ‘‘and who contracts with the Sec9 retary’’;

10 (B) by striking out ‘‘or’’ at the end of such

11 subparagraph (A); and

12 (C) by inserting before the period at the

13 end of such paragraph the following: ‘‘, or (C)

14 who owns or controls existing aircraft, or will

15 own or control new aircraft, and who contrac16 tually commits all or some of such aircraft to

17 the Civil Reserve Air Fleet’’;

18 (8) by redesignating paragraphs (9), (10), (11),

19 and (12) as paragraphs (8), (9), (10), and (11), re20 spectively; and

21 (9) in paragraph (11), as so redesignated—

22 (A) by striking out ‘‘interoperability’’ and

23 inserting in lieu thereof ‘‘compatibility’’; and

24 (B) by striking out ‘‘a cargo-convertible,

25 cargo-capable, or passenger-cargo combined air-
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1 craft’’ and inserting in lieu thereof ‘‘an

2 aeromedical aircraft or a cargo convertible,

3 cargo capable, or passenger cargo combined air4 craft’’.

5 (b) CONSOLIDATION OF PROVISIONS RELATING TO

6 CONTRACTUAL COMMITMENT OF AIRCRAFT.—Chapter

7 931 of such title is amended—

8 (1) by redesignating subsections (b) and (c) of

9 section 9512 as subsections (c) and (d), respectively;

10 (2) by redesignating subsection (a) of section

11 9513 as subsection (b), transferring such subsection

12 (as so redesignated) to section 9512, and inserting

13 such subsection after subsection (a);

14 (3) by redesignating subsection (b) of section

15 9513 as subsection (e) and transferring such sub16 section (as so redesignated) to the end of section

17 9512;

18 (4) in subsection (c) of section 9512, as redes19 ignated by paragraph (1), by striking out ‘‘the terms

20 required by section 9513 of this title and’’;

21 (5) in subsection (e) of section 9512, as redes22 ignated and transferred to such section by para23 graph (3), by striking out ‘‘under section 9512 of

24 this title’’ and inserting in lieu thereof ‘‘entered into

25 under this section’’; and
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1 (6) by striking out the heading of section 9513.

2 (c) USE OF MILITARY INSTALLATIONS BY CONTRAC3 TORS.—

4 (1) AUTHORITY.—Such chapter, as amended by

5 subsection (b), is further amended by adding at the

6 end the following new section 9513:

7 ‘‘§ 9513. Use of military installations by Civil Reserve

8 Air Fleet contractors

9 ‘‘(a) CONTRACT AUTHORITY.—(1) The Secretary of

10 the Air Force—

11 ‘‘(A) may, by contract entered into with any

12 contractor, authorize such contractor to use one or

13 more Air Force installations designated by the Sec14 retary; and

15 ‘‘(B) with the consent of the Secretary of an16 other military department, may, by contract entered

17 into with any contractor, authorize the contractor to

18 use one or more installations, designated by the Sec19 retary of the Air Force, that is under the jurisdic20 tion of the Secretary of such other military depart21 ment.

22 ‘‘(2) The Secretary of the Air Force may include in

23 the contract such terms and conditions as the Secretary

24 determines appropriate to promote the national defense or

25 to protect the interests of the United States.
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1 ‘‘(b) PURPOSES OF USE.—A contract entered into

2 under subsection (a) may authorize use of a designated

3 installation as a weather alternate, a service stop not in4 volving the enplaning or deplaning of passengers or cargo,

5 or, in the case of an installation within the United States,

6 for other commercial purposes. Notwithstanding any other

7 provision of the law, the Secretary may establish different

8 levels and types of uses for different installations for com9 mercial operations not required by the Department of De10 fense and may provide in contracts under subsection (a)

11 for different levels and types of uses by different contrac12 tors.

13 ‘‘(c) DISPOSITION OF PAYMENTS FOR USE.—Not14 withstanding any other provision of law, amounts collected

15 from the contractor for landing fees, services, supplies, or

16 other charges authorized to be collected under the contract

17 shall be credited to the appropriations of the armed forces

18 having jurisdiction over the military installation to which

19 the contract pertains. Amounts so credited to an appro20 priation shall be available for obligation for the same pe21 riod as the appropriation to which credited.

22 ‘‘(d) HOLD HARMLESS REQUIREMENT.—A contract

23 entered into under subsection (a) shall provide that the

24 contractor agrees to indemnify and hold harmless the

25 United States from all actions, suits, or claims of any sort
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1 resulting from, relating to, or arising out of any activities

2 conducted, or services or supplies furnished, in connection

3 with the contract.

4 ‘‘(e) RESERVATION OF RIGHT TO EXCLUDE CON5 TRACTOR.—A contract entered into under subsection (a)

6 shall provide that the Secretary or, in the case of an instal7 lation under the jurisdiction of an armed force other than

8 the Air Force, the Secretary concerned may at any time

9 and without prior notice deny access to an installation des10 ignated under the contract if military exigencies require

11 such action.’’.

12 (2) CLERICAL AMENDMENT.—The table of sec13 tions at the beginning of such chapter is amended

14 by striking out the item relating to section 9513 and

15 inserting in lieu thereof the following:

‘‘9513. Use of military installations by Civil Reserve Air Fleet contractors.’’.

16 SEC. 3024. EXCHANGE OF PERSONNEL.

17 (a) EXCHANGE AUTHORITY.—Subchapter II of chap18 ter 138 of title 10, United States Code, is amended by

19 adding at the end the following new section:

20 ‘‘§ 2350k. Exchange of personnel

21 ‘‘(a) INTERNATIONAL EXCHANGE AGREEMENTS AU22 THORIZED.—Under regulations prescribed by the Sec23 retary of Defense, the Secretary and the secretaries of the

24 military departments are each authorized to enter into

25 agreements with the governments of foreign countries for
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1 the exchange of military and civilian personnel of the De2 partment of Defense and military and civilian personnel

3 of the defense departments or ministries of such foreign

4 governments.

5 ‘‘(b) ASSIGNMENT OF PERSONNEL.—Pursuant to

6 such agreements, personnel of the foreign defense depart7 ments or ministries may be assigned to positions in the

8 Department of Defense, and personnel of the Department

9 of Defense may be assigned to positions in foreign defense

10 departments or ministries. Agreements for the exchange

11 of personnel engaged in research and development activi12 ties may provide for assignments to positions in private

13 industry that support the defense departments or min14 istries. The specific positions and the individuals to be as15 signed must be acceptable to both the sending government

16 and the host government.

17 ‘‘(c) RECIPROCITY OF PERSONNEL QUALIFICATIONS

18 REQUIRED.—Each government shall be required under an

19 agreement authorized by subsection (a) to provide person20 nel having qualifications, training, and skills that are es21 sentially equal to those of the personnel provided by the

22 other government.

23 ‘‘(d) PAYMENT OF PERSONNEL COSTS.—Each gov24 ernment shall pay the salary, per diem, cost of living, trav25 el, cost of language or other training, and other costs (ex-
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1 cept for cost of temporary duty directed by the host gov2 ernment and costs incident to the use of host government

3 facilities in the performance of assigned duties) for its own

4 personnel in accordance with the laws and regulations of

5 such government that pertain to such matters.’’.

6 (b) CLERICAL AMENDMENT.—The table of sections

7 at the beginning of subchapter II of such chapter is

8 amended by adding at the end the following new item:

‘‘2350k. Exchange of personnel.’’.

9 SEC. 3025. SCIENTIFIC INVESTIGATION AND RESEARCH

10 FOR THE NAVY.

11 (a) REPEAL.—Section 7203 of title 10, United States

12 Code, is repealed.

13 (b) CLERICAL AMENDMENT.—The table of sections

14 at the beginning of chapter 631 of such title is amended

15 by striking out the item relating to section 7203.

16 SEC. 3026. CONSTRUCTION OF COMBATANT AND ESCORT

17 VESSELS AND ASSIGNMENT OF VESSEL

18 PROJECTS.

19 (a) REPEAL OF OBSOLETE AND INTERNALLY INCON20 SISTENT PROVISIONS.—Section 7299a of title 10, United

21 States Code, is amended—

22 (1) by striking out subsection (a); and

23 (2) by redesignating subsections (b) and (c) as

24 subsections (a) and (b), respectively.
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1 (b) CONFORMING AMENDMENT.—Subsection (b) of

2 such section, as redesignated by subsection (a)(2), is

3 amended in paragraph (2) by striking out ‘‘subsection (a)

4 or’’.

5 SEC. 3027. REPEAL OF REQUIREMENT FOR CONSTRUCTION

6 OF VESSELS ON PACIFIC COAST.

7 (a) REPEAL.—Section 7302 of title 10, United States

8 Code, is repealed.

9 (b) CLERICAL AMENDMENT.—The table of sections

10 at the beginning of chapter 633 of such title is amended

11 by striking out the item relating to section 7302.

12 SEC. 3028. AUTHORITY TO TRANSFER BY GIFT A VESSEL

13 STRICKEN FROM NAVAL VESSEL REGISTER.

14 Section 7306(a)(1) of title 10, United States Code,

15 is amended by inserting ‘‘Territory,’’ after ‘‘State,’’.

16 SEC. 3029. NAVAL SALVAGE FACILITIES.

17 Chapter 637 of title 10, United States Code, is

18 amended—

19 (1) in section 7361—

20 (A) in subsection (a), by inserting ‘‘AU21 THORITY TO PROVIDE FACILITIES BY CON22 TRACT OR OTHERWISE.—’’ after ‘‘(a)’’;

23 (B) in subsection (b), by inserting ‘‘CON24 TRACTS AFFECTING THE DEPARTMENT OF

25 TRANSPORTATION.—’’ after ‘‘(b)’’; and
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1 (C) by striking out subsection (c) and in2 serting in lieu thereof the following new sub3 section (c):

4 ‘‘(c) LIMITATION ON TERM CONTRACTS.—Term con5 tracts may be entered into for purposes of this section only

6 after—

7 ‘‘(1) it has been demonstrated to the satisfac8 tion of the Secretary of the Navy that available com9 mercial salvage facilities are inadequate to meet na10 tional defense requirements; and

11 ‘‘(2) the Secretary of the Navy determines that

12 adequate public notice of intent to exercise the au13 thority under this subsection has been provided.’’;

14 (2) by designating the text of section 7362 as

15 subsection (d) and transferring such text, as so des16 ignated, to the end of section 7361 of title 10,

17 United States Code;

18 (3) in subsection (d) of section 7361 of such

19 title, as so designated and transferred, by inserting

20 before ‘‘The Secretary’’ the following: ‘‘COMMERCIAL

21 USE OF NAVAL VESSELS AND EQUIPMENT.—’’;

22 (4) by designating the text of section 7363 as

23 subsection (e) and transferring such text, as so des24 ignated, to the end of section 7361 of title 10,

25 United States Code;
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1 (5) in subsection (e) of section 7361 of such

2 title, as so designated and transferred, by inserting

3 before ‘‘Before any salvage vessel’’ the following:

4 ‘‘CONDITIONS FOR TRANSFER OF EQUIPMENT.—’’;

5 (6) by designating the text of section 7365 as

6 subsection (f) and transferring such text, as so des7 ignated, to the end of section 7361 of title 10,

8 United States Code;

9 (7) in subsection (f) of section 7361 of such

10 title, as so designated and transferred, by inserting

11 before ‘‘The Secretary’’ the following: ‘‘SETTLE12 MENT OF CLAIMS.—’’;

13 (8) by designating the text of section 7367 as

14 subsection (g) and transferring such text, as so des15 ignated, to the end of section 7361 of title 10,

16 United States Code;

17 (9) in subsection (g) of section 7361 of such

18 title, as so designated and transferred—

19 (A) by inserting before ‘‘Money received’’

20 the following: ‘‘DISPOSITION OF RECEIPTS.—’’;

21 and

22 (B) by striking out ‘‘this chapter’’ in the

23 first sentence and inserting in lieu thereof ‘‘this

24 section’’;
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1 (10) by striking out the section headings for

2 sections 7362, 7363, 7365, and 7367;

3 (11) by striking out the heading for section

4 7361 and inserting in lieu thereof the following:

5 ‘‘§ 7361. Navy support for salvage operations’’;

6 and

7 (12) in the table of sections at the beginning of

8 such chapter—

9 (A) by striking out the item relating to

10 section 7361 and inserting in lieu thereof the

11 following:

‘‘7361. Navy support for salvage operations.’’;

12 and

13 (B) by striking out the items relating to

14 sections 7362, 7363, 7365, and 7367.

15 Subtitle D—Department of Defense

16 Commercial and Industrial Ac17 tivities

18 SEC. 3051. ACCOUNTING REQUIREMENT FOR CONTRACTED

19 ADVISORY AND ASSISTANCE SERVICES.

20 (a) FUNDING TO BE IDENTIFIED IN BUDGET.—Sec21 tion 1105 of title 31, United States Code, is amended by

22 adding at the end the following new subsection:

23 ‘‘(g)(1) The Director of the Office of Management

24 and Budget shall establish the funding for advisory and

25 assistance services for each department and agency as a
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1 separate object class in each budget annually submitted

2 to the Congress under this section.

3 ‘‘(2)(A) In paragraph (1), except as provided in sub4 paragraph (B), the term ‘advisory and assistance services’

5 means the following services when provided by nongovern6 mental sources:

7 ‘‘(i) Management and professional support serv8 ices.

9 ‘‘(ii) Studies, analyses, and evaluations.

10 ‘‘(iii) Engineering and technical services.

11 ‘‘(B) In paragraph (1), the term ‘advisory and assist12 ance services’ does not include the following services:

13 ‘‘(i) Routine automated data processing and

14 telecommunications services unless such services are

15 an integral part of a contract for the procurement

16 of advisory and assistance services.

17 ‘‘(ii) Architectural and engineering services.

18 ‘‘(iii) Technical support of research and devel19 opment activities.

20 ‘‘(iv) Research on basic mathematics or medi21 cal, biological, physical, social, psychological, or

22 other phenomena.’’.

23 (b) REPEAL OF SOURCE LAW.—Section 512 of Pub24 lic Law 102–394 (106 Stat. 1826) is repealed.

25 (c) REPEAL OF SUPERSEDED PROVISIONS.—
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1 (1) TITLE 10.—

2 (A) REPEAL.—Section 2212 of title 10,

3 United States Code, is repealed.

4 (B) CLERICAL AMENDMENT.—The table of

5 sections at the beginning of chapter 131 of such

6 title is amended by striking out the item relat7 ing to section 2212.

8 (2) TITLE 31.—

9 (A) REPEAL.—Section 1114 of title 31,

10 United States Code, is repealed.

11 (B) CLERICAL AMENDMENT.—The table of

12 sections at the beginning of chapter 11 of such

13 title is amended by striking out the item relat14 ing to section 1114.

15 Subtitle E—Fuel- and Energy16 Related Laws

17 SEC. 3061. LIQUID FUELS AND NATURAL GAS: CONTRACTS

18 FOR STORAGE, HANDLING, OR DISTRIBU19 TION.

20 Section 2388(a) of title 10, United States Code, is

21 amended by striking out ‘‘liquid fuels and natural gas’’

22 and 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

12 amended 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

24 at the beginning of chapter 139 of such title is amended

25 by 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

7 end 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

13 or more, for any vessel, aircraft, or vehicle, through a

14 lease, charter, or similar agreement without previously

15 having considered all costs of such lease (including esti16 mated termination liability) and determined in writing

17 that such lease 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

20 by 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

3 amended by adding at the end the following new sub4 section:

5 ‘‘(c) Paragraphs (1) and (2) of subsection (b) do not

6 apply to contracts for the procurement of soft drinks that

7 are manufactured in the United States. The Secretary of

8 Defense shall prescribe in regulations the standards and

9 procedures for determining whether a particular drink is

10 a soft drink and whether the drink was manufactured in

11 the United States.’’.

12 SEC. 3085. REPEAL OF PREFERENCE FOR RECYCLED

13 TONER CARTRIDGES.

14 The following provisions of law, relating to a pref15 erence for procurement of recycled toner cartridges, are

16 repealed:

17 (1) Section 630 of Public Law 102–393 (106

18 Stat. 1773) and the provision of law set out in

19 quotes in that section (42 U.S.C. 6962(j)).

20 (2) Section 401 of Public Law 103–123 (107

21 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 thresh14 old’ 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

20 that 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

3 economy in contracting and to avoid unnecessary burdens

4 for agencies and contractors, the Federal Acquisition Reg5 ulation shall provide for special simplified procedures for

6 contracts for acquisition of property and services that are

7 not in excess of the simplified acquisition threshold.

8 ‘‘(b) Regulations prescribed pursuant to subsection

9 (a) 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

15 Act’) (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

18 authority does not exceed $2,500 is not a procure19 ment official for the purposes of section 27 of this

20 Act.

21 ‘‘(3) A provision that a purchase not in excess

22 of $2,500 may be made without obtaining competi23 tive quotations if the contracting officer determines

24 that the price for the purchase is reasonable.
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1 ‘‘(4) A requirement that purchases not in ex2 cess of $2,500 be distributed equitably among quali3 fied suppliers.

4 ‘‘(5) A requirement that a contracting officer

5 consider each responsive offer timely received from

6 an eligible offeror.

7 ‘‘(c) A proposed purchase or contract for an amount

8 above the simplified acquisition threshold may not be di9 vided into several purchases or contracts for lesser

10 amounts in order to use the simplified acquisition proce11 dures required by subsection (a).

12 ‘‘(d) In using simplified acquisition procedures, the

13 head of an executive agency shall promote competition to

14 the maximum extent practicable.’’.

15 SEC. 4012. SMALL BUSINESS RESERVATION.

16 Section 15(j) of the Small Business Act (15 U.S.C.

17 644(j)) is amended to read as follows:

18 ‘‘(j)(1) Each contract for the purchase of goods and

19 services that has an anticipated value in excess of $2,500

20 but not in excess of the simplified acquisition threshold

21 and that is subject to simplified acquisition procedures

22 prescribed pursuant to section 29 of the Office of Federal

23 Procurement Policy Act shall be reserved exclusively for

24 small business concerns unless the contracting officer is

25 unable to obtain offers from two or more small business
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1 concerns that are competitive with market prices and are

2 competitive with regard to the quality and delivery of the

3 goods or services being purchased.

4 ‘‘(2) In carrying out paragraph (1), a contracting of5 ficer shall consider a responsive offer timely received from

6 an eligible small business offeror.

7 ‘‘(3) Nothing in paragraph (1) shall be construed as

8 precluding an award of a contract with a value not in ex9 cess of the simplified acquisition threshold under the au10 thority of subsection (a) or (c) of section 8 of this Act,

11 section 2323 of title 10, United States Code, or section

12 712 of the Business Opportunity Development Reform Act

13 of 1988 (Public Law 100–656; 15 U.S.C. 644 note).’’.

14 SEC. 4013. FAST PAYMENT UNDER SIMPLIFIED ACQUISI15 TION PROCEDURES.

16 (a) PAYMENT PROCEDURES.—The simplified acquisi17 tion procedures described in section 29(a) of the Office

18 of Federal Procurement Policy Act (as added by section

19 4011) shall provide for use of the payment terms described

20 in subsection (b), and for the disbursement of payment

21 through electronic fund transfer, whenever circumstances

22 permit.

23 (b) REQUIRED PAYMENT TERMS.—The payment

24 terms for a purchase made pursuant to simplified acquisi25 tion procedures shall require payment, in accordance with
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1 the provisions of chapter 39 of title 31, United States

2 Code, within 15 days after the date of the receipt of a

3 proper invoice for products delivered or services per4 formed, if—

5 (1) in the case of a purchase of property, title

6 to the property vests in the Government upon deliv7 ery of the property to the Government or to a com8 mon carrier;

9 (2) in the case of property or services for which

10 payment is due before the Government’s acceptance

11 of the property or services, the vendor provides com12 mercial or other appropriate warranties assuring

13 that the property or services purchased conform to

14 the requirements set forth in the Government’s pur15 chase offer; and

16 (3) funds are available for making the payment.

17 (c) DISBURSEMENTS TO BE MATCHED WITH OBLI18 GATIONS.—The simplified acquisition procedures shall in19 clude procedures that ensure that each request for a dis20 bursement is matched with a particular obligation before

21 the disbursement is made under the payment terms pro22 vided for under subsection (a).

23 SEC. 4014. PROCUREMENT NOTICE.

24 (a) CONTINUATION OF EXISTING NOTICE THRESH25 OLDS.—Subsection (a) of section 18 of the Office of Fed-
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1 eral Procurement Policy Act (41 U.S.C. 416) is amend2 ed—

3 (1) in paragraph (1), by striking out ‘‘the small

4 purchase threshold’’ each place it appears and in5 serting in lieu thereof ‘‘$25,000’’; and

6 (2) in paragraph (3)(B), by inserting after

7 ‘‘(B)’’ the following: ‘‘in the case of a contract or

8 order expected to exceed the simplified acquisition

9 threshold,’’.

10 (b) CONTENT OF NOTICE.—Subsection (b) of such

11 section is amended—

12 (1) by striking out ‘‘and’’ at the end of para13 graph (4);

14 (2) by striking out the period at the end of

15 paragraph (5) and inserting in lieu thereof a semi16 colon; and

17 (3) by adding at the end the following:

18 ‘‘(6) in the case of a contract in an amount es19 timated to exceed $25,000 but not to exceed the

20 simplified acquisition threshold—

21 ‘‘(A) a description of the procedures to be

22 used in awarding the contract; and

23 ‘‘(B) a statement specifying the periods for

24 prospective offerors and the contracting officer
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1 to take the necessary preaward and award ac2 tions.’’.

3 (c) NOTICE NOT REQUIRED IN ELECTRONIC COM4 MERCE.—Subsection (c)(1) of such section, as amended

5 by section 1055(b), is further amended—

6 (1) by redesignating subparagraphs (A), (B),

7 (C), (D), (E) and (F) as subparagraphs (B), (C),

8 (D), (E), (F), and (G), respectively; and

9 (2) by inserting above subparagraph (B), as so

10 redesignated, the following new subparagraph (A):

11 ‘‘(A) the proposed procurement is conducted by

12 means of electronic commerce pursuant to a system

13 that, as determined by the Administrator for Fed14 eral Procurement Policy, has the capabilities de15 scribed in subsections (a) and (b) of section 4015 of

16 the Federal Acquisition Streamlining Act of 1994;’’.

17 (d) NOTICE UNDER THE SMALL BUSINESS ACT.—

18 (1) CONTINUATION OF EXISTING NOTICE

19 THRESHOLDS.—Subsection (e) of section 8 of the

20 Small Business Act (15 U.S.C. 637) is amended—

21 (A) in paragraph (1), by striking out ‘‘the

22 small purchase threshold’’ each place it appears

23 and inserting in lieu thereof ‘‘$25,000’’; and

24 (B) in paragraph (3)(B), by inserting after

25 ‘‘(B)’’ the following: ‘‘in the case of a contract
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1 or order estimated to exceed the simplified ac2 quisition threshold,’’.

3 (2) CONTENT OF NOTICE.—Subsection (f) of

4 such section is amended—

5 (A) by striking out ‘‘and’’ at the end of

6 paragraph (4);

7 (B) by striking out the period at the end

8 of paragraph (5) and inserting in lieu thereof a

9 semicolon; and

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

11 ‘‘(6) in the case of a contract in an amount es12 timated to exceed the $25,000 but not to exceed the

13 simplified acquisition threshold—

14 ‘‘(A) a description of the procedures to be

15 used in awarding the contract; and

16 ‘‘(B) a statement specifying the periods for

17 prospective offerors and the contracting officer

18 to take the necessary preaward and award ac19 tions.’’.

20 SEC. 4015. ELECTRONIC COMMERCE FOR FEDERAL GOV21 ERNMENT PROCUREMENTS.

22 (a) DEVELOPMENT AND IMPLEMENTATION OF SYS23 TEM.—The Administrator for Federal Procurement Pol24 icy, in consultation with the heads of appropriate Federal

25 Government agencies having applicable technical and
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1 functional expertise, may take appropriate steps to develop

2 and implement a Federal Governmentwide architecture or

3 design for electronic commerce that provides interoper4 ability among users.

5 (b) REQUIRED CAPABILITIES.—The requirements

6 analysis prepared to implement the architecture or design

7 of a system of electronic commerce referred to in sub8 section (a) shall have the following capabilities:

9 (1) The maximum practicable capability for

10 electronic exchange of such procurement information

11 as solicitations, offers, contracts, purchase orders,

12 invoices, payments, and other contractual documents

13 between the private sector and the Federal Govern14 ment.

15 (2) Capabilities that increase the access of busi16 nesses, including small business concerns, socially

17 and economically disadvantaged small business con18 cerns, and businesses owned predominantly by

19 women, to Federal Government procurement oppor20 tunities.

21 (3) Easy access for potential Federal Govern22 ment contractors.

23 (4) Use of nationally and internationally recog24 nized data formats that broaden and ease electronic

25 interchange of data.
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1 (5) Use of Federal Government systems and

2 networks and industry systems and networks.

3 (c) NOTICE AND SOLICITATION REGULATIONS.—In

4 connection with implementation of the architecture or de5 sign referred to in subsection (a), the Federal Acquisition

6 Regulatory Council shall ensure that the Federal Acquisi7 tion Regulation contains appropriate notice and solicita8 tion provisions applicable to acquisitions conducted

9 through such architecture or design. The provisions shall

10 specify the required form and content of notices of acquisi11 tions and the minimum periods for notifications of solicita12 tions and for deadlines for the submission of offers under

13 solicitations. Each minimum period specified for a notifi14 cation of solicitation and each deadline for the submission

15 of offers under a solicitation shall afford potential offerors

16 a reasonable opportunity to respond.

17 (d) LIMITATION OF PUBLICATION REQUIREMENT.—

18 The requirement in section 18(a) of the Office of Federal

19 Procurement Policy Act (41 U.S.C. 416(a)) and section

20 8(e) of the Small Business Act (15 U.S.C. 637(e)) for

21 publishing notice of a solicitation in the Commerce Busi22 ness Daily shall not apply to acquisitions of a Federal

23 agency or a component of a Federal agency that are made

24 through electronic commerce and have a value not in ex25 cess of the simplified acquisition threshold if the Federal
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1 Acquisition Regulation contains the provisions specifically

2 required by subsection (c) and the Administrator for Fed3 eral Procurement Policy certifies that such agency or com4 ponent—

5 (1) has fully implemented the architecture or

6 design referred to in subsection (a); and

7 (2) has procedures in place—

8 (A) to provide notice to potential offerors

9 in accordance with the requirements of the Fed10 eral Acquisition Regulation prescribed pursuant

11 to subsection (c); and

12 (B) to ensure that small business concerns

13 are afforded an opportunity to respond to a so14 licitation of contract offers within the period

15 specified in the solicitation.

16 (e) DEFINITION.—In this section, the term ‘‘sim17 plified acquisition threshold’’ has the meaning given that

18 term is section 4(11) of the Office of Federal Procurement

19 Policy Act (41 U.S.C. 403(11)).

20 PART III—APPLICABILITY OF LAWS TO ACQUISI21 TIONS NOT IN EXCESS OF SIMPLIFIED AC22 QUISITION THRESHOLD

23 SEC. 4021. FUTURE ENACTED PROCUREMENT LAWS.

24 The Office of Federal Procurement Policy Act (41

25 U.S.C. 401 et seq.), as amended by section 4011, is fur-
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1 ther amended by adding at the end the following new sec2 tion:

3 ‘‘APPLICABILITY OF CERTAIN LAWS TO CONTRACTS NOT

4 EXCEEDING SIMPLIFIED ACQUISITION THRESHOLD

5 ‘‘SEC. 30. (a) IN GENERAL.—The applicability of a

6 provision of law described in subsection (b) to contracts

7 not in excess of the simplified acquisition threshold may

8 be waived on a class basis in the Federal Acquisition Reg9 ulation. Such a waiver shall not apply to a provision of

10 law that expressly refers to this section and prohibits the

11 waiver of that provision of law.

12 ‘‘(b) REFERENCED LAW.—A provision of law referred

13 to in subsection (a) is any provision of law enacted after

14 the date of the enactment of the Federal Acquisition

15 Streamlining Act of 1994 that, as determined by the Ad16 ministrator for Federal Procurement Policy, sets forth

17 policies, procedures, requirements, or restrictions for the

18 procurement of property or services by the Federal Gov19 ernment.’’.

20 SEC. 4022. ARMED SERVICES ACQUISITIONS.

21 (a) REQUIREMENT FOR CONTRACT CLAUSE REGARD22 ING CONTINGENT FEES.—Section 2306(b) of title 10,

23 United States Code, is amended by adding at the end the

24 following: ‘‘This subsection does not apply to a contract

25 that is not in excess of the simplified acquisition thresh26 old.’’.
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1 (b) PROHIBITION ON LIMITING SUBCONTRACTOR DI2 RECT SALES TO THE UNITED STATES.—Section 2402 of

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

4 end the following new subsection:

5 ‘‘(c) This section does not apply to a contract that

6 is not in excess of the simplified acquisition threshold (as

7 defined in section 4(11) of the Office of Federal Procure8 ment Policy Act (41 U.S.C. 403(11))).’’.

9 (c) AUTHORITY TO EXAMINE BOOKS AND RECORDS

10 OF CONTRACTORS.—Section 2313 of title 10, United

11 States Code, as amended by section 2201, is further

12 amended by adding at the end of subsection (f) the follow13 ing:

14 ‘‘(2) A contract that is not in excess of the sim15 plified acquisition threshold.’’.

16 (d) REQUIREMENT TO IDENTIFY SUPPLIERS AND

17 SOURCES OF SUPPLIES.—Section 2384(b) of title 10,

18 United States Code, is amended by adding at the end the

19 following new paragraph:

20 ‘‘(3) The regulations prescribed pursuant to para21 graph (1) do not apply to a contract that does not exceed

22 the simplified acquisition threshold (as defined in section

23 4(11) of the Office of Federal Procurement Policy Act (41

24 U.S.C. 403(11))).’’.
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1 (e) PROHIBITION AGAINST DOING BUSINESS WITH

2 CERTAIN OFFERORS OR CONTRACTORS.—Section 2393(d)

3 of title 10, United States Code, is amended in the second

4 sentence by striking out ‘‘above’’ and all that follows and

5 inserting in lieu thereof ‘‘in excess of the simplified acqui6 sition threshold (as defined in section 4(11) of the Office

7 of Federal Procurement Policy Act (41 U.S.C.

8 403(11))).’’.

9 (f) PROHIBITION ON PERSONS CONVICTED OF DE10 FENSE-CONTRACT RELATED FELONIES.—Section

11 2408(a) of title 10, United States Code, is amended by

12 adding at the end the following new paragraph:

13 ‘‘(4) The prohibition in paragraph (1) does not apply

14 with respect to the following:

15 ‘‘(A) A contract referred to in subparagraph

16 (A), (B), (C), or (D) of such paragraph that is not

17 in excess of the simplified acquisition threshold (as

18 defined in section 4(11) of the Office of Federal

19 Procurement Policy Act (41 U.S.C. 403(11))).

20 ‘‘(C) A subcontract referred to in such subpara21 graph that is under a contract described in subpara22 graph (A).’’.

23 SEC. 4023. CIVILIAN AGENCY ACQUISITIONS.

24 (a) REQUIREMENT FOR CONTRACT CLAUSE REGARD25 ING CONTINGENT FEES.—Section 304(a) of the Federal
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1 Property and Administrative Services Act of 1949 (41

2 U.S.C. 254(a)) is amended by adding at the end the fol3 lowing: ‘‘The preceding sentence does not apply to a con4 tract that is not in excess of the simplified acquisition

5 threshold.’’.

6 (b) PROHIBITION ON LIMITING SUBCONTRACTOR DI7 RECT SALES TO THE UNITED STATES.—Section 303G of

8 the Federal Property and Administrative Services Act of

9 1949 (41 U.S.C. 253g) is amended by adding at the end

10 the following new subsection:

11 ‘‘(c) This section does not apply to a contract that

12 is not in excess of the simplified acquisition threshold.’’.

13 (c) AUTHORITY TO EXAMINE BOOKS AND RECORDS

14 OF CONTRACTORS.—Section 304B of the Federal Prop15 erty and Administrative Services Act of 1949, as added

16 by section 2251(a), is amended by adding at the end of

17 subsection (f) the following:

18 ‘‘(2) A contract that is not in excess of the sim19 plified acquisition threshold.’’.

20 SEC. 4024. ACQUISITIONS GENERALLY.

21 (a) LIMITATION ON USE OF FUNDS TO INFLUENCE

22 CERTAIN FEDERAL ACTIONS.—Section 1352(e)(2)(B) of

23 title 31, United States Code, is amended by striking out

24 ‘‘$100,000’’ and inserting in lieu thereof ‘‘the simplified

25 acquisition threshold (as defined in section 4(11) of the
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1 Office of Federal Procurement Policy Act (41 U.S.C.

2 403(11)))’’.

3 (b) REQUIREMENT FOR CONTRACT CLAUSE RELAT4 ING TO KICKBACKS.—Section 7 of the Anti-Kickback Act

5 of 1986 (41 U.S.C. 57) is amended by adding at the end

6 the following new subsection:

7 ‘‘(d) Subsections (a) and (b) do not apply to a prime

8 contract that is not in excess of the simplified acquisition

9 threshold (as defined in section 4(11) of the Office of Fed10 eral Procurement Policy Act (41 U.S.C. 403(11))).’’.

11 (c) MILLER ACT.—

12 (1) IN GENERAL.—

13 (A) CONTRACTS NOT EXCEEDING SIM14 PLIFIED ACQUISITION THRESHOLD.—The Act

15 of August 24, 1935 (40 U.S.C. 270a et seq.),

16 commonly referred to as the ‘‘Miller Act’’, is

17 amended by adding at the end the following

18 new section:

19 ‘‘SEC. 5. This Act does not apply to a contract in

20 an amount that is not in excess of the simplified acquisi21 tion threshold (as defined in section 4(11) of the Office

22 of Federal Procurement Policy Act (41 U.S.C.

23 403(11))).’’.

24 (B) CONFORMING AMENDMENT.—Sub25 section (a) of the first section of such Act is
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1 amended by striking out ‘‘, exceeding $25,000

2 in amount,’’.

3 (2) ALTERNATIVE PAYMENT PROTECTIONS.—

4 (A) PROTECTIONS TO BE SPECIFIED IN

5 THE FAR.—The Federal Acquisition Regulation

6 shall provide alternatives to payment bonds as

7 payment protections for suppliers of labor and

8 materials under contracts referred to in sub9 paragraph (C).

10 (B) USE OF AUTHORIZED PROTECTIONS.—

11 The contracting officer for a contract shall—

12 (i) select, from among the payment

13 protections provided for in the Federal Ac14 quisition Regulation pursuant to subpara15 graph (A), one or more payment protec16 tions which the offeror awarded the con17 tract is to submit to the Federal Govern18 ment for the protection of suppliers of

19 labor and materials for such contract; and

20 (ii) specify in the solicitation of offers

21 for such contract the payment protection

22 or protections so selected.

23 (C) COVERED CONTRACTS.—

24 (i) APPLICABILITY.—The regulations

25 required under subparagraph (A) and the
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1 requirements of subparagraph (B) apply

2 with respect to contracts referred to in

3 subsection (a) of the first section of the

4 Miller Act that are in excess of $25,000

5 but not in excess of the simplified acquisi6 tion threshold (as defined in section 4(11)

7 of the Office of Federal Procurement Pol8 icy Act (41 U.S.C. 403(11))).

9 (ii) MILLER ACT REFERENCE.—The

10 Miller Act referred to in subparagraph (A)

11 is the Act of August 24, 1935 (40 U.S.C.

12 270a et seq.), commonly referred to as the

13 ‘‘Miller Act’’.

14 (d) CONTRACT WORK HOURS AND SAFETY STAND15 ARDS ACT.—

16 (1) IN GENERAL.—Section 103 of the Contract

17 Work Hours and Safety Standards Act (40 U.S.C.

18 329) is amended by adding at the end the following

19 new subsection:

20 ‘‘(c) This title does not apply to a contract in an

21 amount that is not in excess of the simplified acquisition

22 threshold (as defined in section 4(11) of the Office of Fed23 eral Procurement Policy Act (41 U.S.C. 403(11))).’’.

24 (2) CONFORMING AMENDMENT.—Section

25 107(a) of such Act (40 U.S.C. 333(a)) is amended
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1 by inserting after ‘‘It shall be a condition of each

2 contract’’ the following: ‘‘(other than a contract re3 ferred to in section 103(c))’’.

4 (e) DRUG-FREE WORKPLACE ACT OF 1988.—Section

5 5152(a)(1) of the Drug-Free Workplace Act of 1988 (sub6 title D of title V of the Anti-Drug Abuse Act of 1988;

7 Public Law 100–690; 41 U.S.C. 701(a)(1)) is amended

8 by striking out ‘‘of $25,000 or more from any Federal

9 agency’’ and inserting in lieu thereof ‘‘in excess of the sim10 plified acquisition threshold (as defined in section 4(11)

11 of such Act (41 U.S.C. 403(11))) by any Federal agency’’.

12 (f) CERTAIN PROCUREMENT INTEGRITY REQUIRE13 MENTS.—

14 (1) CERTIFICATION REQUIREMENT.—Sub15 section (e)(7)(A) of section 27 of the Office of Fed16 eral Procurement Policy Act (41 U.S.C. 423) is

17 amended by striking out ‘‘$100,000’’ and inserting

18 in lieu thereof ‘‘the simplified acquisition threshold’’.

19 (2) CONTRACT CLAUSE REQUIREMENT.—Sub20 section (g)(1) of such section is amended by insert21 ing after ‘‘awarded by a Federal agency’’ the follow22 ing: ‘‘(other than a contract in an amount that is

23 not in excess of the simplified acquisition thresh24 old)’’.
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1 (g) SOLID WASTE DISPOSAL ACT.—Section 6002(a)

2 of the Solid Waste Disposal Act (42 U.S.C. 6962(a)) is

3 amended by striking out all that follows ‘‘with respect to

4 any’’ and inserting in lieu thereof ‘‘contract in excess of

5 the simplified acquisition threshold (as defined in section

6 4(11) of the Office of Federal Procurement Policy Act (41

7 U.S.C. 403(11))).’’.

8 PART IV—CONFORMING AMENDMENTS

9 SEC. 4071. ARMED SERVICES ACQUISITIONS.

10 (a) SIMPLIFIED ACQUISITION PROCEDURES.—Sec11 tion 2304(g) of title 10, United States Code, is amended—

12 (1) in paragraph (1), by striking out ‘‘small

13 purchases of property and services’’ and inserting in

14 lieu thereof ‘‘purchases of property and services not

15 in excess of the simplified acquisition threshold’’;

16 (2) by striking out paragraph (2);

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

18 paragraphs (2) and (3), respectively;

19 (4) in paragraph (2), as so redesignated—

20 (A) by striking out ‘‘small purchase

21 threshold’’ and inserting in lieu thereof ‘‘sim22 plified acquisition threshold’’; and

23 (B) by striking out ‘‘small purchase proce24 dures’’ and inserting in lieu thereof ‘‘simplified

25 procedures’’; and
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1 (5) in paragraph (3), as redesignated by para2 graph (3), by striking out ‘‘small purchase proce3 dures’’ and inserting in lieu thereof ‘‘the simplified

4 procedures’’.

5 (b) SOLICITATION CONTENT REQUIREMENT.—Sec6 tion 2305(a)(2) of title 10, United States Code, is amend7 ed by striking out ‘‘small purchases)’’ in the matter above

8 subparagraph (A) and inserting in lieu thereof ‘‘purchases

9 not in excess of the simplified acquisition threshold)’’.

10 (c) COST TYPE CONTRACTS.—Section 2306(e)(2)(A)

11 of title 10, United States Code, is amended by striking

12 out ‘‘small purchase threshold’’ and inserting in lieu there13 of ‘‘simplified acquisition threshold’’.

14 SEC. 4072. CIVILIAN AGENCY ACQUISITIONS.

15 (a) SIMPLIFIED ACQUISITION PROCEDURES.—

16 (1) PROPERTY AND SERVICES GENERALLY.—

17 Section 303(g) of the Federal Property and Admin18 istrative Services Act of 1949 (41 U.S.C. 253(g)) is

19 amended—

20 (A) in paragraph (1), by striking out

21 ‘‘small purchases of property and services’’ and

22 inserting in lieu thereof ‘‘purchases of property

23 and services not in excess of the simplified ac24 quisition threshold’’;
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1 (B) by striking out paragraphs (2) and

2 (5);

3 (C) in paragraph (3)—

4 (i) by striking out ‘‘small purchase

5 threshold’’ and inserting in lieu thereof

6 ‘‘simplified acquisition threshold’’; and

7 (ii) by striking out ‘‘small purchase

8 procedures’’ and inserting in lieu thereof

9 ‘‘simplified procedures’’;

10 (E) in paragraph (4), by striking out

11 ‘‘small purchase procedures’’ and inserting in

12 lieu thereof ‘‘the simplified procedures’’; and

13 (F) by inserting after paragraph (1) the

14 following new paragraph (2):

15 ‘‘(2)(A) The Administrator of General Services shall

16 prescribe regulations that provide special simplified proce17 dures for acquisitions of leasehold interests in real prop18 erty at rental rates that do not exceed the simplified acqui19 sition threshold.

20 ‘‘(B) For purposes of subparagraph (A), the rental

21 rate or rates under a multiyear lease do not exceed the

22 simplified acquisition threshold if the average annual

23 amount of the rent payable for the period of the lease does

24 not exceed the simplified acquisition threshold.’’.
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1 (b) SOLICITATION CONTENT REQUIREMENT.—Sec2 tion 303A(b) of the Federal Property and Administrative

3 Services Act of 1949 (41 U.S.C. 253a(b)) is amended by

4 striking out ‘‘small purchases)’’ in the matter above para5 graph (1) and inserting in lieu thereof ‘‘purchases not in

6 excess of the simplified acquisition threshold)’’.

7 (c) COST TYPE CONTRACTS.—Section 304(b) of the

8 Federal Property and Administrative Services Act of 1949

9 (41 U.S.C. 254(b)), as amended by section 1071, is fur10 ther amended in the second sentence by striking out ‘‘ei11 ther $25,000’’ and inserting in lieu thereof ‘‘either the

12 simplified acquisition threshold’’.

13 SEC. 4073. OFFICE OF FEDERAL PROCUREMENT POLICY

14 ACT.

15 Section 19(a) of the Office of Federal Procurement

16 Policy Act (41 U.S.C. 417(a)) is amended by striking out

17 ‘‘procurements, other than small purchases,’’ and insert18 ing in lieu thereof ‘‘procurements in excess of the sim19 plified acquisition threshold’’.

20 SEC. 4074. SMALL BUSINESS ACT.

21 (a) DEFINITION.—Section 3(m) of the Small Busi22 ness Act (15 U.S.C. 632(m)) is amended by striking out

23 ‘‘ ‘small purchase threshold’ ’’ and inserting in lieu thereof

24 ‘‘ ‘simplified acquisition threshold’ ’’.
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1 (b) USE OF SIMPLIFIED ACQUISITION THRESHOLD

2 TERM.—Section 8(d)(2)(A) of the Small Business Act (15

3 U.S.C. 637(d)(2)(A)) is amended by striking out ‘‘small

4 purchase threshold’’ and inserting in lieu thereof ‘‘sim5 plified acquisition threshold’’.

6 PART V—REVISION OF REGULATIONS

7 SEC. 4081. REVISION REQUIRED.

8 (a) FEDERAL ACQUISITION REGULATION.—The Fed9 eral Acquisition Regulatory Council established by section

10 25(a) of the Office of Federal Procurement Policy Act (41

11 U.S.C. 421(a)) shall review the Federal Acquisition Regu12 lation to identify regulations that are applicable to acquisi13 tions in excess of a specified amount that is less than

14 $100,000. The Council shall amend the regulations so

15 identified as necessary to provide that such regulations do

16 not apply to acquisitions that are not in excess of the sim17 plified acquisition threshold. The preceding sentence does

18 not apply in the case of a regulation for which such an

19 amendment would not be in the national interest, as deter20 mined by the Council.

21 (b) SUPPLEMENTAL REGULATIONS.—The head of

22 each Federal agency that has issued regulations, policies,

23 or procedures referred to in section 25(c)(2) of the Office

24 of Federal Procurement Policy Act (41 U.S.C. 421(c)(2))

25 shall identify any such regulations, policies, or procedures
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1 that are applicable to acquisitions in excess of a specified

2 amount that is less than $100,000. The agency head shall

3 amend the regulations so identified as necessary to provide

4 that such regulations, policies, and procedures do not

5 apply to acquisitions that are not in excess of the sim6 plified acquisition threshold. The preceding sentence does

7 not apply in the case of a regulation, policy, or procedure

8 for which such an amendment would not be in the national

9 interest, as determined by the agency head.

10 (c) COMPLETION OF ACTIONS.—All actions under

11 this section shall be completed not later than 180 days

12 after the date of the enactment of this Act.

13 (d) DEFINITIONS.—In this section:

14 (1) The term ‘‘simplified acquisition threshold’’

15 has the meaning given such term in section 4(11) of

16 the Office of Federal Procurement Policy Act (41

17 U.S.C. 403(11)), as amended by section 4001.

18 (2) The term ‘‘Federal agency’’ has the mean19 ing given such term in section 3(b) of the Federal

20 Property and Administrative Services Act of 1949

21 (41 U.S.C. 472(b)).
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1 Subtitle B—Socioeconomic and

2 Small Business Laws

3 SEC. 4101. ACQUISITIONS GENERALLY.

4 (a) REPEAL OF EXECUTED REPORTING REQUIRE5 MENT.—Section 306 of the Trade Agreements Act of 1979

6 (19 U.S.C. 2516) is repealed.

7 (b) WALSH-HEALEY ACT.—

8 (1) REPEAL OTHER THAN FOR CERTAIN DEFI9 NITIONAL PURPOSES.—The Act of June 30, 1936

10 (41 U.S.C. 35 et seq.), commonly referred to as the

11 ‘‘Walsh-Healey Act’’, is amended to read as follows:

12 ‘‘SECTION 1. (a) The Secretary of Labor may pre13 scribe in regulations the standards for determining wheth14 er a contractor is a manufacturer of or a regular dealer

15 in materials, supplies, articles, or equipment to be manu16 factured or used in the performance of a contract entered

17 into by any executive department, independent establish18 ment, or other agency or instrumentality of the United

19 States, or by the District of Columbia, or by any corpora20 tion all the stock of which is beneficially owned by the

21 United States, for the manufacture or furnishing of mate22 rials, supplies, articles, and equipment.

23 ‘‘(b) Any interested person shall have the right of ju24 dicial review of any legal question regarding the interpre-
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1 tation of the terms ‘regular dealer’ and ‘manufacturer’,

2 as defined pursuant to subsection (a).’’

3 (2) CONFORMING AMENDMENT.—Section

4 2304(h) of title 10, United States Code, is amended

5 to read as follows:

6 ‘‘(h) For the purposes of the Act entitled ‘An Act

7 relating to the rate of wages for laborers and mechanics

8 employed on public buildings of the United States and the

9 District of Columbia by contractors and subcontractors,

10 and for other purposes’, approved March 3, 1931 (com11 monly referred to as the ‘Davis-Bacon Act’) (40 U.S.C.

12 276a et seq.), purchases or contracts awarded after using

13 procedures other than sealed-bid procedures shall be treat14 ed as if they were made with sealed-bid procedures.’’.

15 (c) REPEAL OF REDUNDANT REQUIREMENT RE16 GARDING APPLICABILITY OF THE DAVIS-BACON ACT AND

17 THE WALSH-HEALEY ACT.—Section 308 of the Federal

18 Property and Administrative Services Act of 1949 (41

19 U.S.C. 258) is repealed.

20 SEC. 4102. ACQUISITIONS FROM SMALL BUSINESSES.

21 (a) SET-ASIDE PRIORITY.—Section 15 of the Small

22 Business Act (15 U.S.C. 644) is amended by striking out

23 subsections (e) and (f).
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1 (b) CERTIFICATE OF COMPETENCE.—Section 804 of

2 Public Law 103–484 (106 Stat. 2447; 10 U.S.C. 2305

3 note) is repealed.

4 SEC. 4103. CONTRACTING PROGRAM FOR CERTAIN SMALL

5 BUSINESS CONCERNS.

6 (a) PROCUREMENT PROCEDURES AUTHORIZED.—

7 Section 8 of the Small Business Act (15 U.S.C. 637) is

8 amended by inserting after subsection (b) the following

9 new subsection:

10 ‘‘(c)(1) To facilitate the attainment of a goal for the

11 participation of small business concerns owned and con12 trolled by socially and economically disadvantaged individ13 uals that is established for a Federal agency pursuant to

14 section 15(g)(1), the head of the agency may enter into

15 contracts using—

16 ‘‘(A) less than full and open competition by re17 stricting the competition for such awards to small

18 business concerns owned and controlled by socially

19 and economically disadvantaged individuals de20 scribed in subsection (d)(3)(C) of this section; and

21 ‘‘(B) a price evaluation preference not in excess

22 of 10 percent when evaluating an offer received from

23 such a small business concern as the result of an un24 restricted solicitation.
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1 ‘‘(2) Paragraph (1) does not apply to the Department

2 of Defense.’’.

3 (b) IMPLEMENTATION THROUGH THE FEDERAL AC4 QUISITION REGULATION.—

5 (1) IN GENERAL.—The Federal Acquisition

6 Regulation shall be amended to provide for uniform

7 implementation of the authority provided in section

8 8(c) of the Small Business Act, as added by sub9 section (a).

10 (2) MATTERS TO BE ADDRESSED.—The provi11 sions of the Federal Acquisition Regulation pre12 scribed pursuant to paragraph (1) shall include—

13 (A) conditions for the use of advance pay14 ments;

15 (B) provisions for contract payment terms

16 that provide for—

17 (i) accelerated payment for work per18 formed during the period for contract per19 formance; and

20 (ii) full payment for work performed;

21 (C) guidance on how contracting officers

22 may use, in solicitations for various classes of

23 products or services, a price evaluation pref24 erence pursuant to section 8(c)(1)(B) of the

25 Small Business Act, as added by subsection (a),
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1 to provide a reasonable advantage to small busi2 ness concerns owned and controlled by socially

3 and economically disadvantaged individuals

4 without effectively eliminating any participation

5 of other small business concerns; and

6 (D)(i) procedures for a person to request

7 the head of Federal agency to determine wheth8 er the use of competitions restricted to small

9 business concerns owned and controlled by so10 cially and economically disadvantaged individ11 uals at a contracting activity of such agency

12 has caused a particular industry category to

13 bear a disproportionate share of the contracts

14 awarded to attain the goal established for that

15 contracting activity; and

16 (ii) guidance for limiting the use of such

17 restricted competitions in the case of any con18 tracting activity and class of contracts deter19 mined in accordance with such procedures to

20 have caused a particular industry category to

21 bear a disproportionate share of the contracts

22 awarded to attain the goal established for that

23 contracting activity.
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1 (c) TERMINATION.—Section 8(c) of the Small Busi2 ness Act, as added by subsection (a), shall cease to be

3 effective at the end of September 30, 1999.

4 SEC. 4104. PROCUREMENT GOALS FOR SMALL BUSINESS

5 CONCERNS OWNED BY WOMEN.

6 (a) GOALS.—Section 15 of the Small Business Act

7 (15 U.S.C. 644) is amended—

8 (1) by striking out ‘‘and small business con9 cerns owned and controlled by socially and economi10 cally disadvantaged individuals’’ each place it ap11 pears in the first sentence and fourth sentences of

12 subsection (g)(1), the second sentence of subsection

13 (g)(2), and paragraphs (1), (2)(A), (2)(D), and

14 (2)(E) of subsection (h) and inserting in lieu thereof

15 ‘‘, small business concerns owned and controlled by

16 socially and economically disadvantaged individuals,

17 and small business concerns owned and controlled by

18 women’’;

19 (2) in subsection (g)—

20 (A) by inserting after the third sentence of

21 paragraph (1) the following: ‘‘The Government22 wide goal for participation by small business

23 concerns owned and controlled by women shall

24 be established at not less than 5 percent of the
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1 total value of all prime contract and sub2 contract awards for each fiscal year.’’;

3 (B) in the first sentence of paragraph (2),

4 by striking out ‘‘and by small business concerns

5 owned and controlled by socially and economi6 cally disadvantaged individuals,’’ and inserting

7 in lieu thereof ‘‘, by small business concerns

8 owned and controlled by socially and economi9 cally disadvantaged individuals, and by small

10 business concerns owned and controlled by

11 women’’; and

12 (C) in the fourth sentence of paragraph

13 (2), by inserting after ‘‘including participation

14 by small business concerns owned and con15 trolled by socially and economically disadvan16 taged individuals’’ the following: ‘‘and by par17 ticipation small business concerns owned and

18 controlled by women’’; and

19 (3) in subsection (h)(2)(F), by striking out

20 ‘‘women-owned small business enterprises’’ and in21 serting in lieu thereof ‘‘small business concerns

22 owned and controlled by women’’.

23 (b) SUBCONTRACT PARTICIPATION.—Section 8(d) of

24 such Act (15 U.S.C. 637(d)) is amended—
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1 (1) by striking out ‘‘and small business con2 cerns owned and controlled by socially and economi3 cally disadvantaged individuals’’ both places it ap4 pears in paragraph (1), both places it appears in

5 paragraph (3)(A), in paragraph (4)(D), in subpara6 graphs (A), (C), and (F) of paragraph (6), and in

7 paragraph (10)(B) and inserting in lieu thereof ‘‘,

8 small business concerns owned and controlled by so9 cially and economically disadvantaged individuals,

10 and small business concerns owned and controlled by

11 women’’;

12 (2) by striking out subparagraph (D) in para13 graph (3) and inserting in lieu thereof the following:

14 ‘‘(E) Contractors acting in good faith may rely

15 on written representations by their subcontractors

16 regarding their status as either a small business con17 cern, a small business concern owned and controlled

18 by socially and economically disadvantaged individ19 uals, or a small business concern owned and con20 trolled by women.’’;

21 (3) in paragraph (3), by inserting after sub22 paragraph (C) the following new subparagraph (D):

23 ‘‘(D) The term ‘small business concern owned

24 and controlled by women’ shall mean a small busi25 ness concern—
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1 ‘‘(i) which is at least 51 per centum owned

2 by one or more women; or, in the case of any

3 publicly owned business, at least 51 per centum

4 of the stock of which is owned by one or more

5 women; and

6 ‘‘(ii) whose management and daily business

7 operations are controlled by one or more

8 women.’’; and

9 (4) in paragraph (4)(E), by inserting ‘‘and for

10 small business concerns owned and controlled by

11 women’’ after ‘‘as defined in paragraph (3) of this

12 subsection’’.

13 (c) MISREPRESENTATIONS OF STATUS.—(1) Sub14 section (d)(1) of section 16 of such Act (15 U.S.C. 645)

15 is amended by striking out ‘‘or ‘small business concern

16 owned and controlled by socially and economically dis17 advantaged individuals’ ’’ and inserting in lieu thereof ‘‘,

18 a ‘small business concern owned and controlled by socially

19 and economically disadvantaged individuals’, or a ‘small

20 business concerns owned and controlled by women’ ’’.

21 (2) Subsection (e) of such section is amended by

22 striking out ‘‘or ‘small business concern owned and con23 trolled by socially and economically disadvantaged individ24 uals’ ’’ and inserting in lieu thereof ‘‘, a ‘small business

25 concern owned and controlled by socially and economically
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1 disadvantaged individuals’, or a ‘small business concerns

2 owned and controlled by women’ ’’.

3 (d) DEFINITION.—Section 3 of such Act (15 U.S.C.

4 632) is amended by adding at the end the following new

5 subsection:

6 ‘‘(n) For the purposes of this Act, a small business

7 concern is a small business concern owned and controlled

8 by women if—

9 ‘‘(1) at least 51 percent of small business con10 cern is owned by one or more women or, in the case

11 of any publicly owned business, at least 51 percent

12 of the stock of which is owned by one or more

13 women; and

14 ‘‘(2) the management and daily business oper15 ations of the business are controlled by one or more

16 women.’’.

17 SEC. 4105. DEVELOPMENT OF DEFINITIONS REGARDING

18 CERTAIN SMALL BUSINESS CONCERNS.

19 (a) REVIEW REQUIRED.—

20 (1) DEFINITIONS TO BE IDENTIFIED.—The Ad21 ministrator for Federal Procurement Policy shall

22 conduct a comprehensive review of Federal laws, as

23 in effect on November 1, 1994, to identify and cata24 logue all of the provisions in such laws that define

25 (or describe for definitional purposes) the small busi-
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1 ness concerns set forth in paragraph (2) for pur2 poses of authorizing the participation of such small

3 business concerns as prime contractors or sub4 contractors in—

5 (A) contracts awarded directly by the Fed6 eral Government or subcontracts awarded under

7 such contracts; or

8 (B) contracts and subcontracts funded, in

9 whole or in part, by Federal financial assistance

10 under grants, cooperative agreements, or other

11 forms of Federal assistance.

12 (2) COVERED SMALL BUSINESS CONCERNS.—

13 The small business concerns referred to in para14 graph (1) are as follows:

15 (A) Small business concerns owned and

16 controlled by socially and economically dis17 advantaged individuals.

18 (B) Minority-owned small business con19 cerns.

20 (C) Small business concerns owned and

21 controlled by women.

22 (D) Woman-owned small business con23 cerns.

24 (b) MATTERS TO BE DEVELOPED.—On the basis of

25 the results of the review carried out under subsection (a),
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1 the Administrator for Federal Procurement Policy shall

2 develop—

3 (1) uniform definitions for the small business

4 concerns referred to in subsection (a)(2);

5 (2) uniform agency certification standards and

6 procedures for—

7 (A) determinations of whether a small

8 business concern qualifies as a small business

9 concern referred to in subsection (a)(2) under

10 an applicable standard for purposes contracts

11 and subcontracts referred to in subsection

12 (a)(1); and

13 (B) reciprocal recognition by an agency of

14 a decision of another agency regarding whether

15 a small business concern qualifies as a small

16 business concern referred to in subsection

17 (a)(2) for such purposes; and

18 (3) such other related recommendations as the

19 Administrator determines appropriate consistent

20 with the review results.

21 (c) PROCEDURES AND SCHEDULE.—

22 (1) PARTICIPATION BY CERTAIN INTERESTED

23 PARTIES.—The Administrator for Federal Procure24 ment Policy shall provide for the participation in the
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1 review and activities under subsections (a) and (b)

2 by representatives of—

3 (A) the Small Business Administration (in4 cluding the Office of the Chief Counsel for Ad5 vocacy);

6 (B) the Minority Business Development

7 Agency of the Department of Commerce;

8 (C) the Department of Transportation;

9 (D) the Environmental Protection Agency;

10 and

11 (E) such other executive departments and

12 agencies as the Administrator considers appro13 priate.

14 (2) CONSULTATION WITH CERTAIN INTERESTED

15 PARTIES.—In carrying out subsections (a) and (b),

16 the Administrator shall consult with representatives

17 of organizations representing—

18 (A) minority-owned business enterprises;

19 (B) women-owned business enterprises;

20 and

21 (C) other organizations that the Adminis22 trator considers appropriate.

23 (3) SCHEDULE.—Not later than 60 days after

24 the date of the enactment of this Act, the Adminis-
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1 trator shall publish in the Federal Register a notice

2 which—

3 (A) lists the provisions of law identified in

4 the review carried out under subsection (a);

5 (B) describes the matters to be developed

6 on the basis of the results of the review pursu7 ant to subsection (b);

8 (C) solicits public comment regarding the

9 matters described in the notice pursuant to sub10 paragraphs (A) and (B) for a period of not less

11 than 60 days; and

12 (D) addresses such other matters as the

13 Administrator considers appropriate to ensure

14 the comprehensiveness of the review and activi15 ties under subsections (a) and (b).

16 (d) REPORT.—Not later than May 1, 1995, the Ad17 ministrator for Federal Procurement Policy shall submit

18 to the Committees on Small Business of the Senate and

19 the House of Representatives a report on the results of

20 the review carried out under subsection (a) and the actions

21 taken under subsection (b). The report shall include a dis22 cussion of the results of the review, a description of the

23 consultations conducted and public comments received,

24 and the Administrator’s recommendations with regard to

25 the matters identified under subsection (b).
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1 Subtitle C—Miscellaneous

2 Acquisition Laws

3 SEC. 4151. PROHIBITION ON USE OF FUNDS FOR DOCU4 MENTING ECONOMIC OR EMPLOYMENT IM5 PACT OF CERTAIN ACQUISITION PROGRAMS.

6 (a) REVISION AND CODIFICATION.—

7 (1) IN GENERAL.—Subchapter I of chapter 134

8 of title 10, United States Code, is amended by add9 ing at the end the following new section:

10 ‘‘§ 2247. Prohibition on use of funds for documenting

11 economic or employment impact of cer12 tain acquisition programs

13 ‘‘No funds appropriated by the Congress may be obli14 gated or expended to assist any contractor of the Depart15 ment of Defense in preparing any material, report, lists,

16 or analysis with respect to the actual or projected eco17 nomic or employment impact in a particular State or con18 gressional district of an acquisition program for which all

19 research, development, testing, and evaluation has not

20 been completed.’’.

21 (2) CLERICAL AMENDMENT.—The table of sec22 tions at the beginning of such subchapter is amend23 ed 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.’’.
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1 (b) REPEAL OF SUPERSEDED LAW.—Section 9048 of

2 Public Law 102–396 (106 Stat. 1913) is repealed.

3 SEC. 4152. RESTRICTION ON USE OF NONCOMPETITIVE

4 PROCEDURES FOR PROCUREMENT FROM A

5 PARTICULAR SOURCE.

6 (a) ARMED SERVICES ACQUISITIONS.—Section 2304

7 of title 10, United States Code, as amended by section

8 1005(b), is further amended—

9 (1) in subsection (c)(5), by inserting ‘‘subject to

10 subsection (j),’’ after ‘‘(5)’’; and

11 (2) by adding at the end the following new sub12 section:

13 ‘‘(j)(1) It is the policy of Congress that no legislation

14 should be enacted that requires a procurement to be made

15 from a specified non-Federal Government source.

16 ‘‘(2) A provision of law may not be construed as re17 quiring a procurement to be made from a specified non18 Federal Government source unless that provision of law—

19 ‘‘(A) specifically refers to this subsection;

20 ‘‘(B) specifically identifies the particular non21 Federal Government source involved; and

22 ‘‘(C) specifically states that the procurement

23 from that source is required by such provision of law

24 in contravention of the policy set forth in paragraph

25 (1).’’.
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1 (b) CIVILIAN AGENCY ACQUISITIONS.—Section 303

2 of the Federal Property and Administrative Services Act

3 of 1949 (41 U.S.C. 253) is amended—

4 (1) in subsection (c)(5), by inserting ‘‘subject to

5 subsection (h),’’ after ‘‘(5)’’; and

6 (2) by adding at the end the following new sub7 section:

8 ‘‘(h)(1) It is the policy of Congress that no legislation

9 should be enacted that requires a procurement to be made

10 from a specified non-Federal Government source.

11 ‘‘(2) A provision of law may not be construed as re12 quiring a procurement to be made from a specified non13 Federal Government source unless that provision of law—

14 ‘‘(A) specifically refers to this subsection;

15 ‘‘(B) specifically identifies the particular non16 Federal Government source involved; and

17 ‘‘(C) specifically states that the procurement

18 from that source is required by such provision of law

19 in contravention of the policy set forth in paragraph

20 (1).’’.
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1 TITLE V—ACQUISITION

2 MANAGEMENT

3 Subtitle A—Armed Services

4 Acquisitions

5 SEC. 5001. PERFORMANCE BASED MANAGEMENT.

6 (a) POLICY AND GOALS FOR PERFORMANCE BASED

7 MANAGEMENT OF PROGRAMS.—

8 (1) IN GENERAL.—Chapter 131 of title 10,

9 United States Code, is amended by adding at the

10 end the following new section:

11 ‘‘§ 2219. Performance based management: acquisition

12 programs

13 ‘‘(a) CONGRESSIONAL POLICY.—It is the policy of

14 Congress that—

15 ‘‘(1) the Department of Defense should achieve,

16 on average, 90 percent of the cost and schedule

17 goals established for the research and development

18 programs and acquisition programs of the Depart19 ment of Defense without reducing the performance

20 or capabilities of the items being acquired; and

21 ‘‘(2) the average period necessary for converting

22 an emerging technology into initial operational capa23 bility for the Department of Defense should not ex24 ceed 8 years.
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1 ‘‘(b) ESTABLISHMENT OF GOALS.—(1) The Sec2 retary of Defense shall approve or define the cost, per3 formance, and schedule goals for major defense acquisition

4 programs of the Department of Defense.

5 ‘‘(2) The Comptroller of the Department of Defense

6 shall evaluate the cost goals proposed for each major de7 fense acquisition program of the Department.

8 ‘‘(c) IDENTIFICATION OF NONCOMPLIANT PRO9 GRAMS.—Whenever it is necessary to do so in order to

10 implement the policy set out in subsection (a), the Sec11 retary of Defense shall—

12 ‘‘(1) identify and consider whether there is a

13 continuing need for programs that are significantly

14 behind schedule, over budget, or not in compliance

15 with performance or capability requirements taking

16 into consideration—

17 ‘‘(A) the needs of the Department known

18 as of the time of consideration;

19 ‘‘(B) the state of the technology or tech20 nologies relevant to the programs and to the

21 needs of the Department;

22 ‘‘(C) the estimated costs and projected

23 schedules necessary for the completion of such

24 programs; and

25 ‘‘(D) other pertinent information; and
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1 ‘‘(2) identify existing and potential research

2 and development programs and acquisition programs

3 that are suitable alternatives for programs consid4 ered pursuant to paragraph (1).

5 ‘‘(d) ANNUAL REPORTING REQUIREMENT.—The Sec6 retary of Defense shall include in the annual report sub7 mitted to Congress pursuant to section 113(c) of this title

8 an assessment of the progress made in implementing the

9 policy stated in subsection (a). The Secretary shall use

10 data from existing management systems in making the as11 sessment.’’.

12 (2) CLERICAL AMENDMENT.—The table of sec13 tions at the beginning of such chapter is amended

14 by adding at the end the following new item:

‘‘2219. Performance based management: acquisition programs.’’.

15 (b) ENHANCED SYSTEM OF PERFORMANCE INCEN16 TIVES.—Within one year after the date of the enactment

17 of this Act, the Secretary of Defense shall review the in18 centives and personnel actions available to the Secretary

19 for encouraging excellence in the defense acquisition

20 workforce and provide an enhanced system of incentives

21 for the encouragement of excellence in such workforce.

22 The enhanced system of incentives shall, to the maximum

23 extent consistent with applicable law—

24 (1) relate pay to performance (including the ex25 tent to which the performance of personnel in such
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1 workforce contributes to achieving the cost goals,

2 schedule goals, and performance goals established

3 for acquisition programs of the department pursuant

4 to section 2219(b) of title 10, as added by sub5 section (a)); and

6 (2) provide for consideration, in personnel eval7 uations and promotion decisions, of the extent to

8 which the performance of personnel in such

9 workforce contributes to achieving the cost goals,

10 schedule goals, and performance goals established

11 for acquisition programs of the department pursuant

12 to section 2219(b) of title 10, United States Code,

13 as added by subsection (a).

14 (c) RECOMMENDED LEGISLATION.—Not later than

15 one year after the date of the enactment of this Act, the

16 Secretary of Defense shall submit to Congress any rec17 ommended legislation that the Secretary considers nec18 essary to carry out section 2219 of title 10, United States

19 Code, as added by subsection (a), and otherwise to facili20 tate and enhance management of Department of Defense

21 acquisition programs and the defense acquisition

22 workforce on the basis of performance.
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1 SEC. 5002. RESULTS ORIENTED ACQUISITION PROGRAM

2 CYCLE.

3 The Secretary of Defense shall define in regulations

4 a simplified acquisition program cycle that is results-ori5 ented. The Secretary shall consider including in the regu6 lations provisions for the following:

7 (1) Program phases as follows:

8 (A) An integrated decision team meeting

9 which—

10 (i) may be requested by a potential

11 user of the system or component to be ac12 quired, the head of a laboratory, or a pro13 gram office on such bases as the emer14 gence of a new military requirement, cost

15 savings opportunity, or new technology op16 portunity;

17 (ii) is conducted by an acquisition

18 program executive officer; and

19 (iii) is usually completed within 1 to 3

20 months.

21 (B) A prototype development and testing

22 phase which—

23 (i) includes operational tests and con24 cerns relating to manufacturing operations

25 and life cycle support;
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1 (ii) is usually completed within 6 to

2 36 months; and

3 (iii) produces sufficient numbers of

4 prototypes to assess operational utility.

5 (C) Product integration, development, and

6 testing which—

7 (i) includes full-scale development,

8 operational testing, and integration of

9 components; and

10 (ii) is usually completed within 1 to 5

11 years.

12 (D) Production, integration into existing

13 systems, or production and integration into ex14 isting systems.

15 (2) An acquisition program approval process for

16 major program decisions which consists of the fol17 lowing:

18 (A) One major decision point—

19 (i) which occurs for an acquisition

20 program before the program proceeds into

21 product integration and development; and

22 (ii) at which the Under Secretary of

23 Defense for Acquisition and Technology, in

24 consultation with the Vice Chairman of the

25 Joint Chiefs of Staff reviews the program,
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1 determines whether the program should

2 continue to be carried out beyond product

3 integration and development, and decides

4 whether to commit to further development,

5 to require further prototyping, or to termi6 nate the program.

7 (B) Consideration of the potential benefits,

8 affordability, needs, and risks of an acquisition

9 program in the review of the acquisition pro10 gram.

11 SEC. 5003. DEFENSE ACQUISITION PILOT PROGRAM DES12 IGNATIONS.

13 (a) PROGRAMS AND WAIVERS.—The National De14 fense Authorization Act for Fiscal Year 1994 (Public Law

15 103–160) is amended by inserting the following new sec16 tion at the end of subtitle D of title VIII:

17 ‘‘SEC. 840. DEFENSE ACQUISITION PILOT PROGRAM DES18 IGNATIONS.

19 ‘‘(a) ELIGIBLE PROGRAMS.—The Secretary of De20 fense is authorized to designate the following defense ac21 quisition programs for participation in the defense acquisi22 tion pilot program authorized by section 809 of the Na23 tional Defense Authorization Act for Fiscal Year 1991 (10

24 U.S.C. 2430 note):
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1 ‘‘(1) Defense Personnel Support Center medi2 cal, clothing and textile, and subsistence programs

3 with respect to the following:

4 ‘‘(A) All contracts for processed fruits and

5 vegetables and frozen seafood items for both

6 depot stock and direct vendor delivery.

7 ‘‘(B) All contracts in the subsistence prime

8 vendor program for grocery items.

9 ‘‘(C) All contracts in the Mail Order Phar10 macy Program, the prime vendor programs for

11 pharmaceuticals and for medical surgical items

12 for delivery to military hospitals.

13 ‘‘(D) All contracts in the medical electronic

14 commerce program for acquisition for depot

15 stock and direct vendor delivery.

16 ‘‘(E) All contracts for the following items:

17 dress coats (small lots), dress coats, duffel

18 bags, Navy work clothing, general purpose

19 tents, suitcases, gloves for electrical workers,

20 boot flyers, socks, drawers, undershirts, and

21 items offered under the Broad Agency An22 nouncements for Clothing and Textiles Ad23 vanced Business Practices Demonstration Pro24 gram.
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1 ‘‘(2) The Fire Support Combined Arms Tactical

2 Trainer program with respect to all contracts di3 rectly related to the procurement of a training sys4 tem (including related hardware, software, and sub5 systems) to perform collective training of field artil6 lery gunnery team components with development of

7 software as required to generate the training exer8 cises and component interfaces.

9 ‘‘(3) The Joint Direct Attack Munition pro10 gram (JDAM I) with respect to all contracts directly

11 related to the development and procurement of a

12 strap-on guidance kit, using an inertially guided,

13 Global Positioning System updated guidance kit for

14 inventory 1,000 and 2,000 pound bombs.

15 ‘‘(4) The Joint Primary Aircraft Training Sys16 tem (JPATS) with respect to all contracts directly

17 related to the acquisition of a new primary trainer

18 aircraft to fulfill Air Force and Navy joint under19 graduate aviation training requirements, and an as20 sociated ground-based training system consisting of

21 air crew training devices (simulators), courseware, a

22 Training Management System, and contractor sup23 port for the life of the system.

24 ‘‘(5) The Commercial Derivatives Aircraft pro25 gram with respect to all contracts directly related to
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1 the acquisition or upgrading of civil-derivative air2 craft for use in (A) foreign military sales of Airborne

3 Warning and Control Systems to foreign govern4 ments with modifications of a type customarily pro5 vided to commercial customers, or (B) future Air

6 Force airlift and tanker requirements.

7 ‘‘(6) The Commercial Derivative Engine pro8 gram with respect to all contracts directly related to

9 the acquisition of (A) commercially derived engines

10 (including spare engines), logistics support equip11 ment, technical orders, management data, and initial

12 spare parts for use in the C–17A production line,

13 and (B) commercially derived engines to support the

14 purchase of commercial-derivative aircraft to meet

15 future Air Force airlift and tanker requirements, in16 cluding engine replacement and upgrades.

17 ‘‘(b) WAIVER AUTHORITY.—Subject to section 809(c)

18 of the National Defense Authorization Act for Fiscal Year

19 1991, the Secretary of Defense is authorized—

20 ‘‘(1) to apply any amendment or repeal of a

21 provision of law made in the Federal Acquisition

22 Streamlining Act of 1994 to the programs described

23 in subsection (a) before the effective date of such

24 amendment or repeal; and
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1 ‘‘(2) to apply to a procurement of noncommer2 cial items under such programs—

3 ‘‘(A) any authority provided in such Act

4 (or in an amendment made by a provision of

5 such Act) to waive a provision of law in the

6 case of commercial items, and

7 ‘‘(B) any exception applicable under such

8 Act (or an amendment made by a provision of

9 such Act) in the case of commercial items,

10 before the effective date of such provision (or

11 amendment) to the extent that the Secretary deter12 mines necessary to test the application of such waiv13 er or exception to procurements of noncommercial

14 items.

15 ‘‘(c) PILOT PROGRAM IMPLEMENTATION.—In exer16 cising the authority provided in section 809 of the Na17 tional Defense Authorization Act for 1991, and in accord18 ance with sections 833 through 839 of this Act, the Sec19 retary of Defense, shall take the following actions:

20 ‘‘(1) MISSION-ORIENTED PROGRAM MANAGE21 MENT.—For one or more of the defense acquisition

22 programs designated for participation in the defense

23 acquisition pilot program, prescribe and implement

24 procedures which—
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1 ‘‘(A) provide for interaction between the

2 program manager and the commander of the

3 operational command responsible for the re4 quirement for the equipment acquired;

5 ‘‘(B) include provisions for a determination

6 by the commander that items proposed for pro7 curement fulfill the need defined in approved

8 requirements documents; and

9 ‘‘(C) may include a role for the operational

10 commander in decision making for program

11 milestone decisions and performance of accept12 ance testing of items acquired.

13 ‘‘(2) SAVINGS OBJECTIVES.—Not later than 45

14 days after the date of enactment of the Federal Ac15 quisition Streamlining Act of 1994, identify for each

16 defense acquisition program participating in the

17 pilot program quantitative measures and goals for

18 reducing acquisition management costs.

19 ‘‘(3) PROGRAM PHASES.—For each defense ac20 quisition program participating in the pilot program,

21 incorporate in an approved acquisition strategy a

22 program review process that provides senior acquisi23 tion officials with reports that—

24 ‘‘(A) contain essential information on pro25 gram results at quarterly intervals;
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1 ‘‘(B) reduce data requirements from the

2 current major program review reporting re3 quirements; and

4 ‘‘(C) include data on program costs esti5 mates, actual expenditures, performance esti6 mates, performance data from tests, and, con7 sistent with existing statutes, the minimum nec8 essary other data items required to ensure the

9 appropriate expenditure of funds appropriated

10 for that program.

11 ‘‘(4) PROGRAM WORK FORCE POLICIES.—With

12 regard to the review of incentives and personnel ac13 tions required under section 836 of this Act—

14 ‘‘(A) not later than 60 days after the date

15 of the enactment of the Federal Acquisition

16 Streamlining Act of 1994—

17 ‘‘(i) complete the review; and

18 ‘‘(ii) on the basis of the review, define

19 one or more systems that relate incentives,

20 including pay, to achievement of budgets,

21 schedules, and performance requirements;

22 ‘‘(B) not later than 120 days after the

23 date of the enactment of the Federal Acquisi24 tion Streamlining Act of 1994—
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1 ‘‘(i) apply such a system of incentives

2 to not less than one defense acquisition

3 program participating in the pilot pro4 gram; and

5 ‘‘(ii) provide for an assessment of the

6 effectiveness of that system; and

7 ‘‘(C) incorporate the results of actions

8 taken pursuant to this paragraph into the de9 velopment of regulations for the implementation

10 of section 5001(b) of the Federal Acquisition

11 Streamlining Act of 1994.

12 ‘‘(5) EFFICIENT CONTRACTING PROCESS.—

13 Take any additional actions that the Secretary con14 siders necessary to waive regulations, not required

15 by statute, that affect the efficiency of the contract16 ing process, including, in the Secretary’s discretion,

17 defining alternative techniques to reduce reliance on

18 military specifications and standards in contracts for

19 the defense acquisition programs participating in the

20 pilot program.

21 ‘‘(6) CONTRACT ADMINISTRATION: PERFORM22 ANCE BASED CONTRACT MANAGEMENT.—For at

23 least one participating defense acquisition program

24 for which a determination is made to make pay25 ments for work in progress under the authority of
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1 section 2307 of title 10, United States Code, define

2 payment milestones on the basis of quantitative

3 measures of results.

4 ‘‘(7) CONTRACTOR PERFORMANCE ASSESS5 MENT.—Collect and evaluate performance informa6 tion on each contract entered into for a defense ac7 quisition program participating in the pilot program,

8 including information on cost, schedule, and tech9 nical performance for each contractor supporting a

10 participating program.

11 ‘‘(d) APPLICABILITY.—(1) Subsection (b) applies

12 with respect to—

13 ‘‘(A) a contract that is awarded or modified

14 during the period described in paragraph (2); and

15 ‘‘(B) a contract that is awarded before the be16 ginning of such period and is to be performed (or

17 may be performed), in whole or in part, during such

18 period.

19 ‘‘(2) The period referred to in paragraph (1) is the

20 period that begins 45 days after the date of the enactment

21 of the Federal Acquisition Streamlining Act of 1994 and

22 ends on September 30, 1998.’’.

23 (b) RULE OF CONSTRUCTION.—Nothing in section

24 840 of the National Defense Authorization Act for Fiscal

25 Year 1994, as added by subsection (a), shall be construed
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1 as authorizing the appropriation or obligation of funds for

2 the programs designated for participation in the defense

3 acquisition pilot program under the authority of sub4 section (a) of such section 840.

5 Subtitle B—Civilian Agency

6 Acquisitions

7 SEC. 5051. PERFORMANCE BASED MANAGEMENT.

8 (a) POLICY AND GOALS FOR PERFORMANCE BASED

9 MANAGEMENT OF PROGRAMS.—

10 (1) IN GENERAL.—Title III of the Federal

11 Property and Administrative Services Act of 1949

12 (41 U.S.C. 301 et seq.), as amended by sections

13 1552 and 1553, is further amended by adding at the

14 end the following new section:

15 ‘‘PERFORMANCE BASED MANAGEMENT: ACQUISITION

16 PROGRAMS

17 ‘‘SEC. 311. (a) CONGRESSIONAL POLICY.—It is the

18 policy of Congress that the head of each executive agency

19 should achieve, on average, 90 percent of the cost and

20 schedule goals established for the research and develop21 ment programs and acquisition programs of the agency

22 without reducing the performance or capabilities of the

23 items being acquired.

24 ‘‘(b) ESTABLISHMENT OF GOALS.—(1) The head of

25 each executive agency shall approve or define the cost, per-
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1 formance, and schedule goals for major acquisition pro2 grams of the agency.

3 ‘‘(2) The chief financial officer of an executive agency

4 shall evaluate the cost goals proposed for each major de5 fense acquisition program of the agency.

6 ‘‘(c) IDENTIFICATION OF NONCOMPLIANT PRO7 GRAMS.—Whenever it is necessary to do so in order to

8 implement the policy set out in subsection (a), the head

9 of an executive agency shall—

10 ‘‘(1) identify and consider whether there is a

11 continuing need for programs that are significantly

12 behind schedule, over budget, or not in compliance

13 with performance or capability requirements taking

14 into consideration—

15 ‘‘(A) the needs of the agency known as of

16 the time of consideration;

17 ‘‘(B) the state of the technology or tech18 nologies relevant to the programs and to the

19 needs of the agency;

20 ‘‘(C) the estimated costs and projected

21 schedules necessary for the completion of such

22 programs; and

23 ‘‘(D) other pertinent information; and

24 ‘‘(2) identify existing and potential research

25 and development programs and acquisition programs
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1 that are suitable alternatives for programs consid2 ered pursuant to paragraph (1).’’.

3 (2) CLERICAL AMENDMENT.—The table of con4 tents in the first section of such Act, as amended by

5 sections 1552 and 1553, is further amended by in6 serting after the item relating to section 310 the fol7 lowing new item:

‘‘Sec. 311. Performance based management: acquisition programs.’’.

8 (b) ANNUAL REPORTING REQUIREMENT.—Section 6

9 of the Office of Federal Procurement Policy Act (41

10 U.S.C. 405), as amended by section 1091, is further

11 amended by adding at the end the following new sub12 section:

13 ‘‘(k) The Administrator shall submit to Congress, on

14 an annual basis, an assessment of the progress made in

15 executive agencies in implementing the policy stated in

16 section 311(a) of the Federal Property and Administrative

17 Services Act of 1949. The Administrator shall use data

18 from existing management systems in making the assess19 ment.’’.

20 (c) ENHANCED SYSTEM OF PERFORMANCE INCEN21 TIVES.—Within one year after the date of the enactment

22 of this Act, the Administrator for Federal Procurement

23 Policy, in consultation with appropriate officials in other

24 departments and agencies of the Federal Government,
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1 shall, to the maximum extent consistent with applicable

2 law—

3 (1) establish policies and procedures for the

4 heads of such departments and agencies to designate

5 acquisition positions and manage employees (includ6 ing the accession, education, training and career de7 velopment of employees) in the designated acquisi8 tion positions;

9 (2) extend to the acquisition workforce of the

10 entire executive branch the acquisition workforce

11 policies contained in chapter 87 of title 10, United

12 States Code, relating to the acquisition workforce of

13 the Department of Defense; and

14 (3) review the incentives and personnel actions

15 available to the heads of department and agencies of

16 the Federal Government for encouraging excellence

17 in the acquisition workforce of the Federal Govern18 ment and provide an enhanced system of incentives

19 for the encouragement of excellence in such

20 workforce which—

21 (A) relates pay to performance (including

22 the extent to which the performance of person23 nel in such workforce contributes to achieving

24 the cost goals, schedule goals, and performance

25 goals established for acquisition programs pur-
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1 suant to section 311(b) of the Federal Property

2 and Administrative Services Act of 1949, as

3 added by subsection (a)); and

4 (B) provides for consideration, in personnel

5 evaluations and promotion decisions, of the ex6 tent to which the performance of personnel in

7 such workforce contributes to achieving such

8 cost goals, schedule goals, and performance

9 goals.

10 (d) RECOMMENDED LEGISLATION.—Not later than

11 one year after the date of the enactment of this Act, the

12 Administrator for Federal Procurement Policy shall sub13 mit to Congress any recommended legislation that the Sec14 retary considers necessary to carry out section 311 of the

15 Federal Property and Administrative Services Act of

16 1949, as added by subsection (a), and otherwise to facili17 tate and enhance management of Federal Government ac18 quisition programs and the acquisition workforce of the

19 Federal Government on the basis of performance.

20 SEC. 5052. RESULTS-ORIENTED ACQUISITION PROCESS.

21 (a) DEVELOPMENT OF PROCESS REQUIRED.—The

22 Administrator for Federal Procurement Policy, in con23 sultation with the heads of appropriate Federal agencies,

24 shall develop a results-oriented acquisition process for im25 plementation by agencies in acquisitions of property and
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1 services by the Federal agencies. The process shall include

2 the identification of quantitative measures and standards

3 for determining the extent to which an acquisition of non4 commercial items by a Federal agency satisfies the needs

5 for which the items are being acquired.

6 (b) INAPPLICABILITY OF PROCESS TO DEPARTMENT

7 OF DEFENSE.—The process developed pursuant to sub8 section (a) may not be applied to the Department of De9 fense.

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

15 at 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 en22 sure the establishment of criteria for selection of contrac23 tors to receive exceptional performance awards under the

24 program.
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1 ‘‘(2) The head of an executive agency may select one

2 or more agency contractors to receive an exceptional per3 formance award under the program.

4 ‘‘(c) AWARD CEREMONY.—The Vice President, or the

5 head of the executive agency selecting a contractor for an

6 exceptional performance award, shall present the award

7 to the contractor with such ceremony as the Vice Presi8 dent or head of the agency, as the case may be, considers

9 appropriate.’’.

10 SEC. 5092. DEPARTMENT OF DEFENSE ACQUISITION OF IN11 TELLECTUAL PROPERTY RIGHTS.

12 Section 2386 of title 10, United States Code, is

13 amended by striking out paragraphs (3) and (4) and in14 serting in lieu thereof the following:

15 ‘‘(3) Technical data and computer software.

16 ‘‘(4) Releases for past infringement of patents

17 or copyrights or for unauthorized use of technical

18 data or computer software.’’.
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1 TITLE VI—STANDARDS OF

2 CONDUCT

3 Subtitle A—Ethics Provisions

4 SEC. 6001. AMENDMENTS TO OFFICE OF FEDERAL PRO5 CUREMENT POLICY ACT.

6 (a) RECUSAL.—Subsection (c) of section 27 of the

7 Office of Federal Procurement Policy Act (41 U.S.C. 423)

8 is amended—

9 (1) in paragraph (1)—

10 (A) in the matter above subparagraph (A),

11 by inserting ‘‘only’’ after ‘‘subsection (b)(1)’’;

12 and

13 (B) in subparagraph (A), by inserting

14 ‘‘(including the modification or extension of a

15 contract)’’ after ‘‘any procurement’’;

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

17 inserting in lieu thereof:

18 ‘‘(2) Whenever the head of a procuring activity ap19 proves a recusal under paragraph (1), a copy of the

20 recusal request and the approval of the request shall be

21 retained by such official for a period (not less than five

22 years) specified in regulations prescribed in accordance

23 with subsection (o).

24 ‘‘(3)(A) Except as provided in subparagraph (B), all

25 recusal requests and approvals of recusal requests pursu-
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1 ant to this subsection shall be made available to the public

2 on request.

3 ‘‘(B) Any part of a recusal request or an approval

4 of a recusal request that is exempt from the disclosure

5 requirements of section 552 of title 5, United States Code,

6 under subsection (b)(1) of such section may be withheld

7 from disclosure to the public otherwise required under

8 subparagraph (A).’’; and

9 (3) in paragraph (4), by striking out ‘‘compet10 ing contractor’’ and inserting in lieu thereof ‘‘per11 son’’.

12 (b) APPLICABILITY OF CERTIFICATION REQUIRE13 MENT.—Subsection (e)(7)(A) of such section is amended

14 by adding at the end the following: ‘‘However, paragraph

15 (1)(B) does not apply with respect to a contract for less

16 than $500,000.’’.

17 (c) RESTRICTIONS RESULTING FROM PROCUREMENT

18 ACTIVITIES OF PROCUREMENT OFFICIALS.—Subsection

19 (f) of such section is amended—

20 (1) by redesignating paragraph (3) as para21 graph (4); and

22 (2) by striking out paragraphs (1) and (2) and

23 inserting in lieu thereof the following:

24 ‘‘(1) No individual who, in the year prior to separa25 tion from service as an officer or employee of the Govern-
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1 ment or an officer of the uniformed services in a covered

2 position, participated personally and substantially in ac3 quisition functions related to a contract, subcontract, or

4 claim of $500,000 or more and—

5 ‘‘(A) engaged in repeated direct contact with

6 the contractor or subcontractor on matters relating

7 to such contract, subcontract, or claim; or

8 ‘‘(B) exercised significant ongoing decisionmak9 ing responsibility with respect to the contractor or

10 subcontractor on matters relating to such contract,

11 subcontract, or claim,

12 shall knowingly accept or continue employment with such

13 contractor or subcontractor for a period of 1 year follow14 ing the individual’s separation from service, except that

15 such individual may accept or continue employment with

16 any division or affiliate of such contractor or subcontrac17 tor that does not produce the same or similar products

18 as the entity involved in the negotiation or performance

19 of the contract or subcontract or the adjustment of the

20 claim.

21 ‘‘(2) No contractor or subcontractor, or any officer,

22 employee, agent, or consultant of such contractor or sub23 contractor shall knowingly offer, provide, or continue any

24 employment for another person, if such contractor, sub25 contractor, officer, employee, agent, or consultant knows
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1 or should know that the acceptance of such employment

2 is or would be in violation of paragraph (1).

3 ‘‘(3) The head of each Federal agency shall designate

4 in writing as a ‘covered position’ under this section each

5 of the following positions in that agency:

6 ‘‘(A) The position of source selection authority,

7 member of a source selection evaluation board, or

8 chief of a financial or technical evaluation team, or

9 any other position, if the officer or employee in that

10 position is likely personally to exercise substantial

11 responsibility for ongoing discretionary functions in

12 the evaluation of proposals or the selection of a

13 source for a contract in excess of $500,000.

14 ‘‘(B) The position of procuring contracting offi15 cer, or any other position, if the officer or employee

16 in that position is likely personally to exercise sub17 stantial responsibility for ongoing discretionary func18 tions in the negotiation of a contract in excess of

19 $500,000 or the negotiation or settlement of a claim

20 in excess of $500,000.

21 ‘‘(C) The position of program executive officer,

22 program manager, or deputy program manager, or

23 any other position, if the officer or employee in that

24 position is likely personally to exercise similar sub25 stantial responsibility for ongoing discretionary func-
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1 tions in the management or administration of a con2 tract in excess of $500,000.

3 ‘‘(D) The position of administrative contracting

4 officer, the position of an officer or employee as5 signed on a permanent basis to a Government Plant

6 Representative’s Office, the position of auditor, a

7 quality assurance position, or any other position, if

8 the officer or employee in that position is likely per9 sonally to exercise substantial responsibility for on10 going discretionary functions in the on-site oversight

11 of a contractor’s operations with respect to a con12 tract in excess of $500,000.

13 ‘‘(E) A position in which the incumbent is likely

14 personally to exercise substantial responsibility for

15 ongoing discretionary functions in operational or de16 velopmental testing activities involving repeated di17 rect contact with a contractor regarding a contract

18 in excess of $500,000.’’.

19 (d) DISCLOSURE OF PROPRIETARY OR SOURCE SE20 LECTION INFORMATION TO UNAUTHORIZED PERSONS.—

21 Subsection (l) of such section is amended—

22 (1) by inserting ‘‘who are likely to be involved

23 in contracts, modifications, or extensions in excess of

24 $25,000’’ in the first sentence after ‘‘its procure25 ment officials’’; and
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1 (2) by striking out ‘‘(e)’’ each place it appears

2 and inserting in each such place ‘‘(f)’’.

3 (e) RULES OF CONSTRUCTION.—Subsection (n) of

4 such section is amended to read as follows:

5 ‘‘(n) RULES OF CONSTRUCTION.—Nothing in this

6 section shall be construed to—

7 ‘‘(1) authorize the withholding of any informa8 tion from the Congress, any committee or sub9 committee thereof, a Federal agency, any board of

10 contract appeals of a Federal agency, the Comptrol11 ler General, or an inspector general of a Federal

12 agency;

13 ‘‘(2) restrict the disclosure of information to, or

14 receipt of information by, any person or class of per15 sons authorized, in accordance with applicable agen16 cy regulations or procedures, to receive that infor17 mation;

18 ‘‘(3) restrict a contractor from disclosing its

19 own proprietary information or the recipient of in20 formation so disclosed by a contractor from receiving

21 such information; or

22 ‘‘(4) restrict the disclosure or receipt of infor23 mation relating to a Federal agency procurement

24 that has been canceled by the agency and that the
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1 contracting officer concerned determines in writing

2 is not likely to be resumed.’’.

3 (f) TERM TO BE DEFINED IN REGULATIONS.—Sub4 section (o)(2)(A) of such section is amended—

5 (1) by inserting ‘‘money, gratuity, or other’’ be6 fore ‘‘thing of value’ ’’; and

7 (2) by inserting before the semicolon ‘‘and such

8 other exceptions as may be adopted on a Govern9 mentwide basis under section 7353 of title 5, United

10 States Code’’.

11 (g) TERMS DEFINED IN LAW.—Subsection (p) of

12 such section is amended—

13 (1) in paragraph (1) by striking out ‘‘clauses

14 (i)–(viii)’’ and inserting in lieu thereof ‘‘clauses (i)

15 through (vii)’’;

16 (2) in paragraph (3)—

17 (A) in subparagraph (A)—

18 (i) by striking out clause (i);

19 (ii) by redesignating clauses (ii), (iii),

20 (iv), (v), (vi), (vii), and (viii) as clauses (i),

21 (ii), (iii), (iv), (v), (vi), and (vii), respec22 tively; and

23 (iii) in clause (i) (as redesignated by

24 subclause (II) of this clause), by striking

25 out ‘‘review and approval of a specifica-
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1 tion’’ and inserting in lieu thereof ‘‘ap2 proval or issuance of a specification, acqui3 sition plan, procurement request, or req4 uisition’’; and

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

6 all after ‘‘includes’’ and inserting in lieu thereof

7 the following: ‘‘any individual acting on behalf

8 of, or providing advice to, the agency with re9 spect to any phase of the agency procurement

10 concerned, regardless of whether such individ11 ual is a consultant, expert, or adviser, or an of12 ficer or employee of a contractor or subcontrac13 tor (other than a competing contractor).’’; and

14 (3) in paragraph (6)(A), by inserting

15 ‘‘nonpublic’’ before ‘‘information’’.

16 SEC. 6002. AMENDMENTS TO TITLE 18, UNITED STATES

17 CODE.

18 Section 208(a) of title 18, United States Code, is

19 amended—

20 (1) by inserting ‘‘(1)’’ before ‘‘Except as per21 mitted’’; and

22 (2) by adding at the end the following new

23 paragraph:

24 ‘‘(2) Whoever knowingly aids, abets, counsels, com25 mands, induces, or procures conduct prohibited by this
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1 section shall be subject to the penalties set forth in section

2 216 of this title.’’.

3 SEC. 6003. REPEAL OF SUPERSEDED AND OBSOLETE LAWS.

4 (a) REPEAL.—The following provisions of law are re5 pealed:

6 (1) Sections 2207, 2397, 2397a, 2397b, and

7 2397c of title 10, United States Code.

8 (2) Section 281 of title 18, United States Code.

9 (3) Section 801 of title 37, United States Code.

10 (4) Part A of title VI of the Department of En11 ergy Organization Act (42 U.S.C. 7211 through

12 7218).

13 (b) CLERICAL AMENDMENTS.—

14 (1) TITLE 10.—Part IV of subtitle A of title 10,

15 United States Code, is amended—

16 (A) in the table of sections at the begin17 ning of chapter 131, by striking out the item

18 relating to section 2207; and

19 (B) in the table of sections for chapter

20 141, by striking out the items relating to sec21 tions 2397, 2397a, 2397b, and 2397c.

22 (2) TITLE 18.—The table of sections for chap23 ter 15 of title 18, United States Code, is amended

24 by striking out the item relating to section 281.
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1 (3) TITLE 37.—The table of sections for chap2 ter 15 of title 37, United States Code, is amended

3 by striking out the item relating to section 801.

4 (4) DEPARTMENT OF ENERGY ORGANIZATION

5 ACT.—The table of contents for the Department of

6 Energy Organization Act is amended by striking out

7 the matter relating to part A of title VI.

8 SEC. 6004. IMPLEMENTATION.

9 (a) REGULATIONS.—Not later than 180 days after

10 the date of the enactment of this Act, regulations imple11 menting the amendments made by section 6001 to section

12 27 of the Office of Federal Procurement Policy Act (41

13 U.S.C. 423), including definitions of the terms used in

14 subsection (f) of such section, shall be issued in accord15 ance with sections 6 and 25 of such Act (41 U.S.C. 405

16 and 521) after coordination with the Director of the Office

17 of Government Ethics.

18 (b) SAVINGS PROVISIONS.—

19 (1) CONTRACTOR CERTIFICATIONS.—No officer,

20 employee, agent, representative, or consultant of a

21 contractor who has signed a certification under sec22 tion 27(e)(1)(B) of the Office of Federal Procure23 ment Policy Act (41 U.S.C. 423(e)(1)(B)) before the

24 effective date of this Act shall be required to sign a
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1 new certification as a result of the enactment of this

2 Act.

3 (2) FEDERAL PROCUREMENT OFFICIAL CER4 TIFICATIONS.—No procurement official of a Federal

5 agency who has signed a certification under section

6 27(l) of the Office of Federal Procurement Policy

7 Act (41 U.S.C. 423(l)) before the date of enactment

8 of this Act shall be required to sign a new certifi9 cation as a result of the enactment of this Act.

10 (c) INSPECTOR GENERAL REPORTS.—Not later than

11 May 31 of each of the years 1995 through 1998, the In12 spector General of each Federal agency (or, in the case

13 of a Federal agency that does not have an Inspector Gen14 eral, the head of such agency) shall submit to Congress

15 a report on the compliance by the agency during the pre16 ceding year with the requirement for the head of the agen17 cy to designate covered procurement positions under sec18 tion 27(f)(3) of the Office of Federal Procurement Policy

19 Act (as added by section 6001(c)).

20 Subtitle B—Additional

21 Amendments

22 SEC. 6051. CONTRACTING FUNCTIONS PERFORMED BY FED23 ERAL PERSONNEL.

24 (a) AMENDMENT OF OFPP ACT.—The Office of Fed25 eral Procurement Policy Act, as amended by section 1092,
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1 is further amended by inserting after section 22 the fol2 lowing new section 23:

3 ‘‘CONTRACTING FUNCTIONS PERFORMED BY FEDERAL

4 PERSONNEL

5 ‘‘SEC. 23. (a) LIMITATION ON PAYMENT FOR ADVI6 SORY AND ASSISTANCE SERVICES.—(1) No person who is

7 not a person described in subsection (b) may be paid by

8 an agency for services to conduct evaluations or analyses

9 of any aspect of a proposal submitted for an acquisition

10 unless personnel described in subsection (b) with adequate

11 training and capabilities to perform such evaluations and

12 analyses are not readily available within the agency or an13 other Federal agency, as determined in accordance with

14 standards and procedures prescribed in the Federal Acqui15 sition Regulation.

16 ‘‘(2) In the administration of this subsection, the

17 head of each agency shall determine in accordance with

18 the standards and procedures set forth in the Federal Ac19 quisition Regulation whether—

20 ‘‘(A) a sufficient number of personnel described

21 in subsection (b) within the agency or another Fed22 eral agency are readily available to perform a par23 ticular evaluation or analysis for the agency head

24 making the determination; and
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1 ‘‘(B) the readily available personnel have the

2 training and capabilities necessary to perform the

3 evaluation or analysis.

4 ‘‘(b) COVERED PERSONNEL.—For purposes of sub5 section (a), the personnel described in this subsection are

6 as follows:

7 ‘‘(1) An employee, as defined in section 2105 of

8 title 5, United States Code.

9 ‘‘(2) A member of the Armed Forces of the

10 United States.

11 ‘‘(3) A person assigned to a Federal agency

12 pursuant to subchapter VI of chapter 33 of title 5,

13 United States Code.

14 ‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sec15 tion is intended to affect the relationship between the Fed16 eral Government and a federally funded research and de17 velopment center.’’.

18 (b) REQUIREMENT FOR GUIDANCE AND REGULA19 TIONS.—Not later than 90 days after the date of the en20 actment of this Act, the Federal Acquisition Regulatory

21 Council established by section 25(a) of the Office of Fed22 eral Procurement Policy Act (41 U.S.C. 421(a)) shall—

23 (1) review part 37 of title 48 of the Code of

24 Federal Regulations as it relates to the use of advi25 sory and assistance services; and
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1 (2) provide guidance and promulgate regula2 tions regarding—

3 (A) what actions Federal agencies are re4 quired to take to determine whether expertise is

5 readily available within the Federal Government

6 before contracting for advisory and technical

7 services to conduct acquisitions; and

8 (B) the manner in which personnel with

9 expertise may be shared with agencies needing

10 expertise for such acquisitions.

11 SEC. 6052. REPEAL OF EXECUTED REQUIREMENT FOR

12 STUDY AND REPORT.

13 Section 17 of the Office of Federal Procurement Pol14 icy Act (41 U.S.C. 415) is repealed.

15 SEC. 6053. INTERESTS OF MEMBERS OF CONGRESS.

16 Section 3741 of the Revised Statutes (41 U.S.C. 22)

17 is amended to read as follows:

18 ‘‘No member of Congress shall be admitted to any

19 share or part of any contract or agreement made, entered

20 into, or accepted by or on behalf of the United States,

21 or to any benefit to arise thereupon.’’.
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1 SEC. 6054. WAITING PERIOD FOR SIGNIFICANT CHANGES

2 PROPOSED FOR ACQUISITION REGULATIONS.

3 (a) INCREASED PERIOD.—Section 22(a) of the Office

4 of Federal Procurement Policy Act (41 U.S.C. 418b) is

5 amended—

6 (1) by striking out ‘‘30 days’’ and inserting in

7 lieu thereof ‘‘60 days’’; and

8 (2) by adding at the end the following: ‘‘Not9 withstanding the preceding sentence, such a policy,

10 regulation, procedure, or form may take effect ear11 lier than 60 days after the publication date when

12 there are compelling circumstances for the earlier

13 effective date, but in no event may that effective

14 date be less than 30 days after the publication

15 date.’’.

16 (b) TECHNICAL AMENDMENT.—Section 22(d) of such

17 Act is amended by designating the second sentence as

18 paragraph (3).

19 Subtitle C—Whistleblower

20 Protection

21 SEC. 6101. ARMED SERVICES PROCUREMENTS.

22 (a) WHISTLEBLOWER PROTECTIONS FOR CONTRAC23 TOR EMPLOYEES.—Section 2409 of title 10, United

24 States Code, is amended—

25 (1) by striking out subsection (d);
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1 (2) by redesignating subsection (c) as sub2 section (d); and

3 (3) by inserting after subsection (b) the follow4 ing new subsection (c):

5 ‘‘(c) REMEDY AND ENFORCEMENT AUTHORITY.—(1)

6 If the Secretary of Defense determines that a defense con7 tractor has subjected a person to a reprisal prohibited by

8 subsection (a), the Secretary may take one or more of the

9 following actions:

10 ‘‘(A) Order the defense contractor to take af11 firmative action to abate the reprisal.

12 ‘‘(B) Order the defense contractor to reinstate

13 the person to the position that the person held be14 fore the reprisal, together with the compensation (in15 cluding back pay), employment benefits, and other

16 terms and conditions of employment that would

17 apply to the person in that position if the reprisal

18 had not been 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 attor22 ney’s fees and expert witnesses’ fees) that were rea23 sonably incurred by the complainant for, or in con24 nection with, bringing the complaint regarding the

25 reprisal, 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

4 district 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

10 an order issued under paragraph (1) may obtain review

11 of the order’s conformance with this subsection, and any

12 regulations issued to carry out this section, in the United

13 States court of appeals for a circuit in which the reprisal

14 is alleged in the order to have occurred. No petition seek15 ing such review may be filed more than 60 days after issu16 ance of the Secretary’s order. Review shall conform to

17 chapter 7 of title 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

23 is amended by striking out the item relating to sec24 tion 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 fur5 ther amended by adding at the end the following new sec6 tion:

7 ‘‘CONTRACTOR EMPLOYEES: PROTECTION FROM REPRISAL

8 FOR DISCLOSURE OF CERTAIN INFORMATION

9 ‘‘SEC. 32. (a) PROHIBITION OF REPRISALS.—An em10 ployee of an executive agency contractor may not be dis11 charged, demoted, or otherwise discriminated against as

12 a reprisal for disclosing to a Member of Congress or an

13 authorized official of the agency or the Department of

14 Justice information relating to a substantial violation of

15 law related to an agency contract (including the competi16 tion for or negotiation of an agency contract).

17 ‘‘(b) INVESTIGATION OF COMPLAINTS.—A person

18 who believes that the person has been subjected to a re19 prisal prohibited by subsection (a) may submit a complaint

20 to the Inspector General of the executive agency. Unless

21 the Inspector General determines that the complaint is

22 frivolous, the Inspector General shall investigate the com23 plaint and, upon completion of such investigation, submit

24 a report of the findings of the investigation to the person,

25 the contractor concerned, and the head of the agency. In

26 the case of an executive agency that does not have an in-
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1 spector general, the duties of the inspector general under

2 this section shall be performed by an official designated

3 by the agency head.

4 ‘‘(c) REMEDY AND ENFORCEMENT AUTHORITY.—(1)

5 If the head of an executive agency determines that an

6 agency contractor has subjected a person to a reprisal pro7 hibited by subsection (a), the agency head may take one

8 or more of the following actions:

9 ‘‘(A) Order the contractor to take affirmative

10 action to abate the reprisal.

11 ‘‘(B) Order the contractor to reinstate the per12 son to the position that the person held before the

13 reprisal, together with the compensation (including

14 back pay), employment benefits, and other terms

15 and conditions of employment that would apply to

16 the person in that position if the reprisal had not

17 been taken.

18 ‘‘(C) Order the contractor to pay the complain19 ant an amount equal to the aggregate amount of all

20 costs and expenses (including attorney’s fees and ex21 pert witnesses’ fees) that were reasonably incurred

22 by the complainant for, or in connection with, bring23 ing the complaint regarding the reprisal, as deter24 mined by the Secretary.
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1 ‘‘(2) Whenever a person fails to comply with an order

2 issued under paragraph (1), the agency head shall file an

3 action for enforcement of such order in the United States

4 district 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

10 an order issued under paragraph (1) may obtain review

11 of the order’s conformance with this subsection, and any

12 regulations issued to carry out this section, in the United

13 States court of appeals for a circuit in which the reprisal

14 is alleged in the order to have occurred. No petition seek15 ing such review may be filed more than 60 days after issu16 ance of the agency head’s order. Review shall conform to

17 chapter 7 of title 5, United States Code.

18 ‘‘(d) CONSTRUCTION.—Nothing in this section may

19 be construed to authorize the discharge of, demotion of,

20 or discrimination against an employee for a disclosure

21 other than a disclosure protected by subsection (a) or to

22 modify or derogate from a right or remedy otherwise avail23 able to the employee.

24 ‘‘(e) COORDINATION WITH OTHER LAW.—This sec25 tion does not apply with respect to the Department of De-
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1 fense. For the corresponding provision of law applicable

2 to the Department of Defense, see section 2409 of title

3 10, United States Code.

4 ‘‘(f) DEFINITION.—In this section, the term ‘Inspec5 tor General’ means an Inspector General appointed under

6 the Inspector General Act of 1978.’’.

7 TITLE VII—DEFENSE TRADE AND

8 COOPERATION

9 SEC. 7001. PURCHASES OF FOREIGN GOODS.

10 (a) REPEAL OF EXECUTED REQUIREMENTS.—

11 (1) REQUIREMENT FOR POLICY GUIDANCE.—

12 Title III of the Act of March 3, 1933 (41 U.S.C.

13 10a et seq.), commonly referred to as the ‘‘Buy

14 American Act’’, is amended in section 4(g) (41

15 U.S.C. 10b–1(g)) by striking out paragraphs (2)(C)

16 and (3).

17 (2) REPORTING REQUIREMENT.—Section

18 9096(b) of Public Law 102–396 (106 Stat. 1924; 41

19 U.S.C. 10b–2(b)) is repealed.

20 (b) REPEAL OF REDUNDANT PROVISION.—

21 (1) CONSIDERATION OF NATIONAL SECURITY

22 OBJECTIVES.—Section 2327 of title 10, United

23 States Code, is repealed.

24 (2) CLERICAL AMENDMENT.—The table of sec25 tions at the beginning of chapter 137 of such title
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1 is amended by striking out the item relating to sec2 tion 2327.

3 SEC. 7002. INTERNATIONAL COOPERATIVE AGREEMENTS.

4 (a) TERMINOLOGY REVISIONS.—Section 2531 of title

5 10, United States Code, is amended—

6 (1) in the subsection captions for subsections

7 (a) and (c), by striking out ‘‘MOUS AND RELATED’’

8 and inserting in lieu thereof ‘‘INTERNATIONAL’’;

9 (2) in subsection (a), by striking out ‘‘proposed

10 memorandum of understanding, or any existing or

11 proposed agreement related to a memorandum of

12 understanding,’’ in the matter above paragraph (1)

13 and inserting in lieu thereof ‘‘proposed international

14 agreement, including a memorandum of understand15 ing,’’;

16 (3) by striking out ‘‘memorandum of under17 standing or related agreement’’ each place it appears

18 and inserting in lieu thereof ‘‘international agree19 ment’’;

20 (4) in subsection (b), by striking out ‘‘memo21 randum or related agreement’’ each place it appears

22 in the second sentence and inserting in lieu thereof

23 ‘‘international agreement’’; and

24 (5) in subsection (c)—
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1 (A) by striking out ‘‘A’’ after ‘‘AGREE2 MENTS.—’’ and inserting in lieu thereof ‘‘An’’;

3 and

4 (B) by striking out ‘‘memorandum or

5 agreement’’ and inserting in lieu thereof ‘‘inter6 national agreement’’.

7 (b) EXPANDED SCOPE OF AGREEMENTS.—Section

8 2531(a) of title 10, United States Code, is amended by

9 striking out ‘‘research, development, or production’’ in the

10 matter above paragraph (1) and inserting in lieu thereof

11 ‘‘research, development, production, or logistics support’’.

12 (c) CLERICAL AMENDMENTS.—

13 (1) SECTION HEADING.—The heading of section

14 2531 of title 10, United States Code, is amended to

15 read as follows:

16 ‘‘§ 2531. Defense international agreements’’.

17 (2) TABLE OF SECTIONS.—The item relating to

18 such section in the table of sections at the beginning

19 of subchapter V of chapter 148 of such title is

20 amended to read as follows:

‘‘2531. Defense international agreements.’’.

21 SEC. 7003. ACQUISITION, CROSS-SERVICING AGREEMENTS,

22 AND STANDARDIZATION.

23 (a) LIMITED WAIVER OF RESTRICTIONS ON AC24 CRUED REIMBURSABLE LIABILITIES AND CREDITS FOR

25 CONTINGENCY OPERATIONS.—Section 2347 of title 10,
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1 United States Code, is amended by adding at the end the

2 following new subsection:

3 ‘‘(c) The Secretary of Defense may waive the restric4 tions in subsections (a) and (b) for a period not to exceed

5 180 days upon a written determination that the armed

6 forces are involved in a contingency operation or that in7 volvement of the armed forces in a contingency operation

8 is imminent. Upon making such a determination, the Sec9 retary shall transmit a copy of the determination to the

10 Committees on Armed Services of the Senate and House

11 of Representatives.’’.

12 (b) COMMUNICATIONS SUPPORT.—Section 2350f of

13 title 10, United States Code, is amended—

14 (1) by redesignating subsection (d) as sub15 section (e); and

16 (2) by inserting after subsection (c) the follow17 ing new subsection:

18 ‘‘(d)(1) Nothing in this section shall be construed to

19 limit the authority of the Secretary of Defense, without

20 a formal bilateral agreement or multilateral arrangement,

21 to furnish communications support and related supplies

22 to, or receive communications support and related supplies

23 from, an allied country in accordance with this subsection.
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1 ‘‘(2) The Secretary of Defense may furnish or receive

2 such support and supplies on a reciprocal basis for a pe3 riod not to exceed 90 days—

4 ‘‘(A) in order to meet emerging operational re5 quirements of the United States and the allied coun6 try; or

7 ‘‘(B) incident to a joint military exercise with

8 the allied country.

9 ‘‘(3) If interconnection of communication circuits is

10 maintained for joint or multilateral defense purposes

11 under the authority of this subsection, the costs of main12 taining such circuits may be allocated among the various

13 users.’’.

14 TITLE VIII—COMMERCIAL ITEMS

15 SEC. 8001. DEFINITIONS.

16 Section 4 of the Office of Federal Procurement Policy

17 Act (41 U.S.C. 403), as amended by section 4001(a), is

18 further amended—

19 (1) by striking out ‘‘Act—’’and inserting in lieu

20 thereof ‘‘Act:’’;

21 (2) by capitalizing the initial letter in the first

22 word of each paragraph;

23 (3) by striking out the semicolon at the end of

24 each of paragraphs (1), (2), (3), (5), (6), (7), (8),

25 and (9) and inserting in lieu thereof a period;
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1 (4) in paragraphs (4) and (10), by striking out

2 ‘‘; and’’ at the end and inserting in lieu thereof a

3 period; and

4 (5) by adding at the end the following new

5 paragraphs:

6 ‘‘(12) The term ‘commercial item’ means—

7 ‘‘(A) property, other than real property,

8 that is of a type customarily used by the gen9 eral public or by nongovernmental entities in

10 the course of normal business operations for

11 purposes other than governmental purposes

12 and—

13 ‘‘(i) has been sold, leased, or licensed

14 to the general public;

15 ‘‘(ii) has not been sold, leased, or li16 censed to the general public but has been

17 offered for sale, lease, or license to the

18 general public; or

19 ‘‘(iii) is not yet available in the com20 mercial marketplace but will be made

21 available for commercial delivery within a

22 reasonable period;

23 ‘‘(B) any item that, but for—
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1 ‘‘(i) modifications of a type customar2 ily available in the commercial market3 place, or

4 ‘‘(ii) minor modifications made to

5 meet Federal Government requirements,

6 would satisfy the criteria in subparagraph (A);

7 ‘‘(C) any combination of items meeting the

8 requirements of subparagraph (A), (B), or (D)

9 that are of a type customarily combined and

10 sold in combination to the general public;

11 ‘‘(D) installation services, maintenance

12 services, repair services, training services, and

13 other services if such services are procured for

14 support of an item referred to in subparagraph

15 (A), (B), or (C) and if the source of such serv16 ices—

17 ‘‘(i) offers such services to the general

18 public and the Federal Government con19 temporaneously and under similar terms

20 and conditions; and

21 ‘‘(ii) offers to use the same work force

22 for providing the Federal Government with

23 such services as the source uses for provid24 ing such services to the general public; and
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1 ‘‘(E) any item, combination of items, or

2 service referred to in subparagraph (A), (B),

3 (C), or (D), regardless of whether the item,

4 combination of items, or service is transferred

5 between or among separate divisions, subsidi6 aries, or affiliates of a contractor.

7 ‘‘(13) The term ‘nondevelopmental item’

8 means—

9 ‘‘(A) any commercial item;

10 ‘‘(B) any previously developed item of sup11 ply that is in use by a department or agency of

12 the United States, a State or local government,

13 or a foreign government with which the United

14 States has a mutual defense cooperation agree15 ment;

16 ‘‘(C) any item of supply described in sub17 paragraph (A) or (B) that requires only minor

18 modification of the type normally available in

19 the commercial marketplace in order to meet

20 the requirements of the procuring department

21 or agency; or

22 ‘‘(D) any item of supply currently being

23 produced that does not meet the requirements

24 of subparagraph (A), (B), or (C) solely because

25 the item—
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1 ‘‘(i) is not yet in use; or

2 ‘‘(ii) is not yet available in the com3 mercial marketplace.

4 ‘‘(14) The term ‘component’ means any item

5 supplied to the Federal Government as part of an

6 end item or of another component.

7 ‘‘(15) The term ‘commercial component’ means

8 any component that is a commercial item.’’.

9 SEC. 8002. PREFERENCE FOR ACQUISITION OF COMMER10 CIAL ITEMS AND NONDEVELOPMENTAL

11 ITEMS.

12 (a) PREFERENCE REQUIRED.—The Office of Federal

13 Procurement Policy Act (41 U.S.C. 401 et seq.), as

14 amended by section 6102, is further amended by adding

15 at the end the following new section:

16 ‘‘PREFERENCE FOR ACQUISITION OF COMMERCIAL ITEMS

17 AND NONDEVELOPMENTAL ITEMS

18 ‘‘SEC. 33. (a) PREFERENCE.—The head of each exec19 utive agency shall ensure that, to the maximum extent

20 practicable—

21 ‘‘(1) requirements of the executive agency with

22 respect to a procurement of supplies are stated in

23 terms of—

24 ‘‘(A) functions to be performed;

25 ‘‘(B) performance required; or

26 ‘‘(C) essential physical characteristics;
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1 ‘‘(2) such requirements are defined so that

2 commercial items or, to the extent that commercial

3 items suitable to meet the agency’s needs are not

4 available, other nondevelopmental items may be pro5 cured to fulfill such requirements; and

6 ‘‘(3) offerors of commercial items and other

7 nondevelopmental items are provided an opportunity

8 to compete in any procurement to fill such require9 ments.

10 ‘‘(b) IMPLEMENTATION.—The head of each executive

11 agency shall ensure that procurement officials in that ex12 ecutive agency, to the maximum extent practicable—

13 ‘‘(1) acquire commercial items or other

14 nondevelopmental items to meet the needs of the ex15 ecutive agency;

16 ‘‘(2) require prime contractors and subcontrac17 tors at all levels under the executive agency con18 tracts to incorporate commercial items or other

19 nondevelopmental items as components of items sup20 plied to the executive agency;

21 ‘‘(3) modify requirements in appropriate cases

22 to ensure that the requirements can be met by com23 mercial items or, to the extent that commercial

24 items suitable to meet the agency’s needs are not

25 available, other nondevelopmental items;
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1 ‘‘(4) state specifications in terms that enable

2 and encourage bidders and offerors to supply com3 mercial items or, to the extent that commercial

4 items suitable to meet the agency’s needs are not

5 available, other nondevelopmental items in response

6 to the executive agency solicitations;

7 ‘‘(5) revise the executive agency’s procurement

8 policies, practices, and procedures not required by

9 law to reduce any impediments in those policies,

10 practices, and procedures to the acquisition of com11 mercial items; and

12 ‘‘(6) require training of appropriate personnel

13 in the acquisition of commercial items.

14 ‘‘(c) PRELIMINARY MARKET RESEARCH.—(1) The

15 head of an executive agency shall conduct market research

16 appropriate to the circumstances—

17 ‘‘(A) before developing new specifications for a

18 procurement by that executive agency; and

19 ‘‘(B) before soliciting bids or proposals for a

20 contract in excess of the simplified acquisition

21 threshold.

22 ‘‘(2) The head of an executive agency shall use the

23 results of market research to determine whether there are

24 commercial items or, to the extent that commercial items
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1 suitable to meet the agency’s needs are not available, other

2 nondevelopmental items available that—

3 ‘‘(A) meet the executive agency’s requirements;

4 ‘‘(B) could be modified to meet the executive

5 agency’s requirements; or

6 ‘‘(C) could meet the executive agency’s require7 ments if those requirements were modified to a rea8 sonable extent.

9 ‘‘(3) In conducting market research, the head of an

10 executive agency should not require potential sources to

11 submit more than the minimum information that is nec12 essary to make the determinations required in paragraph

13 (2).’’.

14 (b) REPEAL OF SUPERSEDED PROVISION.—

15 (1) SEPARATE STATEMENT OF PREFERENCE

16 FOR DEPARTMENT OF DEFENSE.—Section 2325 of

17 title 10, United States Code, is repealed.

18 (2) CLERICAL AMENDMENT.—The table of sec19 tions at the beginning of chapter 137 of such title

20 is amended by striking out the item relating to sec21 tion 2325.

22 SEC. 8003. ACQUISITION OF COMMERCIAL ITEMS.

23 (a) REQUIRED FAR PROVISIONS.—The Office of

24 Federal Procurement Policy Act (41 U.S.C. 401 et seq.),
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1 as amended by section 8002, is further amended by adding

2 at the end the following:

3 ‘‘FEDERAL ACQUISITION REGULATION PROVISIONS RE4 GARDING ACQUISITIONS OF COMMERCIAL ITEMS AND

5 COMPONENTS

6 ‘‘SEC. 34. (a) CONTRACT CLAUSES AND OTHER

7 CLAUSES.—(1)(A) The Federal Acquisition Regulation

8 shall include one or more sets of contract clauses contain9 ing the required terms and conditions for the acquisition

10 of commercial items and commercial components by execu11 tive agencies and by contractors in the performance of

12 contracts of executive agencies.

13 ‘‘(B) The contract clauses referred to in subpara14 graph (A) shall include only—

15 ‘‘(i) those clauses that are required to imple16 ment provisions of law or executive orders applicable

17 to acquisitions of commercial items or commercial

18 components, as the case may be;

19 ‘‘(ii) those contract clauses that are essential

20 for the protection of the Federal Government’s inter21 est in an acquisition of commercial items or commer22 cial components, as the case may be; and

23 ‘‘(iii) those contract clauses that are determined

24 to be consistent with standard commercial practice.

25 ‘‘(2) Subject to paragraph (3), the Federal Acquisi26 tion Regulation shall require that, to the maximum extent
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1 practicable, only the contract clauses referred to in para2 graph (1) be used in a contract, or be required to be used

3 in a subcontract, for the acquisition of commercial items

4 or commercial components by or for an executive agency.

5 ‘‘(3) The Federal Acquisition Regulation shall pro6 vide that a contract or subcontract referred to in para7 graph (2) may contain contract clauses other than the

8 contract clauses referred to in that paragraph only if the

9 other clauses are essential for the protection of the Fed10 eral Government’s interest in—

11 ‘‘(A) that contract or subcontract, as deter12 mined in writing by the contracting officer for such

13 contract; or

14 ‘‘(B) a class of contracts or subcontracts, as de15 termined by the head of an agency concerned, unless

16 the determination of that head of an agency is dis17 approved by the Administrator.

18 ‘‘(4) The Federal Acquisition Regulation shall pro19 vide standards and procedures for waiving the use of con20 tract clauses required pursuant to paragraph (1), other

21 than those required by law, including standards for deter22 mining the cases in which a waiver is appropriate.

23 ‘‘(b) MARKET ACCEPTANCE.—(1) The Federal Ac24 quisition Regulation shall provide that under appropriate
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1 conditions the head of an executive agency may require

2 offerors to demonstrate that the items offered—

3 ‘‘(A) have either—

4 ‘‘(i) achieved commercial market accept5 ance; or

6 ‘‘(ii) been satisfactorily supplied to an ex7 ecutive agency under current or recent con8 tracts for the same or similar requirements; and

9 ‘‘(B) otherwise meet the item description, speci10 fications, or other criteria prescribed in the public

11 notice and solicitation relating to the contract.

12 ‘‘(2) The Federal Acquisition Regulation shall pro13 vide guidance to ensure that the criteria for determining

14 commercial market acceptance include the consideration

15 of—

16 ‘‘(A) the minimum needs of the executive agen17 cy concerned; and

18 ‘‘(B) the entire relevant commercial market, in19 cluding small businesses.

20 ‘‘(c) USE OF FIRM, FIXED PRICE CONTRACTS.—The

21 Federal Acquisition Regulation shall include a require22 ment that firm, fixed price contracts or fixed price with

23 economic price adjustment contracts, be used, to the maxi24 mum extent practicable, for the acquisition of commercial

25 items.
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1 ‘‘(d) CONTRACT QUALITY REQUIREMENTS.—The

2 Federal Acquisition Regulation shall include provisions

3 that—

4 ‘‘(1) permit, to the maximum extent prac5 ticable, a contractor under a commercial items ac6 quisition to use the contractor’s existing quality as7 surance system as a substitute for compliance with

8 a requirement for the Federal Government to inspect

9 or test the commercial items before the contractor’s

10 tender of those items for acceptance by the Federal

11 Government;

12 ‘‘(2) require that, to the maximum extent prac13 ticable, an executive agency accept commercial war14 ranties (including extended warranties) offered by

15 offerors of commercial items to commercial cus16 tomers and use such warranties for the repair and

17 replacement of commercial items; and

18 ‘‘(3) set forth guidance to executive agencies re19 garding the use of past performance of items and

20 sources as a factor in contract award decisions.

21 ‘‘(e) TREATMENT OF TRANSFERS BETWEEN AFFILI22 ATES.—The Federal Acquisition Regulation shall provide

23 for a transfer of commercial items from one division, sub24 sidiary, or affiliate of a contractor to another division, sub25 sidiary, or affiliate of the contractor to be treated as a
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1 subcontract for purposes of section 35 of the Office of

2 Federal Procurement Policy Act and the provisions of law

3 amended by section 8005 of the Federal Acquisition

4 Streamlining Act of 1994.’’.

5 (b) DEFENSE CONTRACT CLAUSES.—

6 (1) TERMINATION OF DOD AUTHORITY.—Sec7 tion 824(b) of the National Defense Authorization

8 Act for Fiscal Years 1990 and 1991 (Public Law

9 101–189; 10 U.S.C. 2325 note) shall cease to be ef10 fective on the date on which the regulations imple11 menting section 34 of the Office of Federal Procure12 ment Policy Act, as added by subsection (a), become

13 effective.

14 (2) SAVINGS PROVISION.—Notwithstanding sec15 tion 34(a) of the Office of Federal Procurement Pol16 icy Act (as added by subsection (a)), contracts of the

17 Department of Defense entered into before the date

18 on which section 824(b) ceases to be effective under

19 paragraph (1), and subcontracts entered into before

20 such date under such contracts, may include clauses

21 developed pursuant to paragraphs (2) and (3) of sec22 tion 824(b) of the National Defense Authorization

23 Act for Fiscal Years 1990 and 1991 (Public Law

24 101–189; 10 U.S.C. 2325 note).
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1 SEC. 8004. CLASS WAIVER OF APPLICABILITY OF CERTAIN

2 LAWS.

3 The Office of Federal Procurement Policy Act (41

4 U.S.C. 401 et seq.), as amended by section 8003, is fur5 ther amended by adding at the end the following:

6 ‘‘CLASS WAIVER OF APPLICABILITY OF CERTAIN LAWS TO

7 ACQUISITIONS OF COMMERCIAL ITEMS

8 ‘‘SEC. 35. (a) IN GENERAL.—The applicability of a

9 provision of law described in subsection (c) that is enacted

10 after the date of the enactment of the Federal Acquisition

11 Streamlining Act of 1994 to contracts for the acquisition

12 of commercial items may be waived on a class basis in

13 the Federal Acquisition Regulation. Such a waiver shall

14 not apply to a provision of law that expressly refers to

15 this section and prohibits the waiver of that provision of

16 law.

17 ‘‘(b) WAIVER OF APPLICABILITY TO SUB18 CONTRACTS.—(1) The applicability of a provision of law

19 described in subsection (c) to subcontracts under a con20 tract for the acquisition of commercial items or a sub21 contract for the acquisition of commercial components

22 may be waived on a class basis in the Federal Acquisition

23 Regulation. Such a waiver shall not apply to a provision

24 of law that expressly refers to this section and prohibits

25 the waiver of that provision 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,

11 as determined by the Federal Acquisition Regulatory

12 Council, sets forth policies, procedures, requirements, or

13 restrictions for the procurement of property or services by

14 the Federal 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

25 AND SOURCES OF SUPPLIES.—Paragraph (2) of sec-
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1 tion 2384(b) of title 10, United States Code, is

2 amended to read as follows:

3 ‘‘(2) The regulations prescribed pursuant to para4 graph (1) do not apply to a contract that requires the de5 livery of supplies that are commercial items, as defined

6 in section 2302 of this title.’’.

7 (3) PROHIBITION AGAINST DOING BUSINESS

8 WITH CERTAIN OFFERORS OR CONTRACTORS.—Sec9 tion 2393(d) of title 10, United States Code, as

10 amended by section 4022(e), is further amended by

11 adding at the end the following: ‘‘The requirement

12 shall not apply in the case of a subcontract for the

13 acquisition of commercial items (as defined in sec14 tion 4(12) of the Office of Federal Procurement Pol15 icy Act (41 U.S.C. 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

20 the following new subsection:

21 ‘‘(d)(1) An agreement between the contractor in a

22 contract for the acquisition of commercial items and a

23 subcontractor under such contract that restricts sales by

24 such subcontractor directly to persons other than the con25 tractor may not be considered to unreasonably restrict
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1 sales by that subcontractor to the United States in viola2 tion of the provision included in such contract pursuant

3 to subsection (a) if the agreement does not result in the

4 Federal Government being treated differently with regard

5 to the restriction than any other prospective purchaser of

6 such commercial items from that subcontractor.

7 ‘‘(2) In paragraph (1), the term ‘commercial item’

8 has the meaning given such term in section 4(12) of the

9 Office of Federal Procurement Policy Act (41 U.S.C.

10 403(12)).’’.

11 (5) CONTRACTOR INVENTORY ACCOUNTING SYS12 TEMS: STANDARDS.—Section 2410b of title 10,

13 United States Code, is amended—

14 (A) by inserting ‘‘(a) REGULATIONS RE15 QUIRED.—’’ before ‘‘The Secretary of Defense’’;

16 and

17 (B) by adding at the end the following new

18 subsection:

19 ‘‘(b) INAPPLICABILITY TO ACQUISITIONS OF COM20 MERCIAL ITEMS.—The regulations prescribed pursuant to

21 subsection (a) need not apply to a contract for the acquisi22 tion of commercial items (as defined in section 4(12) of

23 the Office of Federal Procurement Policy Act (41 U.S.C.

24 403(12))).’’.
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1 (6) PROHIBITION ON PERSONS CONVICTED OF

2 DEFENSE-CONTRACT RELATED FELONIES.—Para3 graph (4) of section 2408(a) of title 10, United

4 States Code, as added by section 4022(f), is amend5 ed—

6 (A) by inserting after subparagraph (A)

7 the following:

8 ‘‘(B) A contract referred to in such subpara9 graph that is for the acquisition of commercial items

10 (as defined in section 4(12) of the Office of Federal

11 Procurement Policy Act (41 U.S.C. 403(12))).’’; and

12 (B) by inserting ‘‘or (B)’’ before the period

13 at the end of subparagraph (C).

14 (b) CIVILIAN AGENCY ACQUISITIONS.—

15 (1) RESTRICTIONS ON SUBCONTRACTOR SALES

16 TO THE UNITED STATES.—Section 303G of the Fed17 eral Property and Administrative Services Act of

18 1949 (41 U.S.C. 253g), as amended by section

19 4023(b), is further amended by adding at the end

20 the following new subsection:

21 ‘‘(d) 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
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1 that subcontractor to the United States in violation of the

2 provision included in such contract pursuant to subsection

3 (a) if the agreement does not result in the Federal Govern4 ment being treated differently with regard to the restric5 tion than any other prospective purchaser of such commer6 cial items from that subcontractor.’’.

7 (2) PROHIBITION ON CONTINGENT FEES.—Sec8 tion 304(a) of the Federal Property and Administra9 tive Services Act of 1949 (41 U.S.C. 254(a)), as

10 amended by section 4023(a), is further amended by

11 inserting before the period at the end of the sentence

12 added by section 4023(a) the following: ‘‘or to a con13 tract for the acquisition of commercial items’’.

14 (c) ACQUISITIONS GENERALLY.—

15 (1) FEDERAL WATER POLLUTION CONTROL

16 ACT.—Section 508 of the Federal Water Pollution

17 Control Act (33 U.S.C. 1368) is amended by adding

18 at the end the following new subsection:

19 ‘‘(f)(1) No certification by a contractor, and no con20 tract clause, may be required in the case of a contract

21 for the acquisition of commercial items in order to imple22 ment a prohibition or requirement of this section or a pro23 hibition or requirement issued in the implementation of

24 this section.
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1 ‘‘(2) In paragraph (1), the term ‘commercial item’

2 has the meaning given such term in section 4(12) of the

3 Office of Federal Procurement Policy Act (41 U.S.C.

4 403(12)).’’.

5 (2) CONTRACT WORK HOURS AND SAFETY

6 STANDARDS ACT.—The Contract Work Hours and

7 Safety Standards Act (title I of the Work Hours and

8 Safety Act of 1962 (40 U.S.C. 327 et seq.)) is

9 amended by adding at the end the following new sec10 tion:

11 ‘‘SEC. 108. (a) No certification by a contractor, and

12 no contract clause, may be required in the case of a con13 tract for the acquisition of commercial items in order to

14 implement a prohibition or requirement in this title.

15 ‘‘(b) In subsection (a), the term ‘commercial item’

16 has the meaning given such term in section 4(12) of the

17 Office of Federal Procurement Policy Act (41 U.S.C.

18 403(12)).’’.

19 (3) OFFICE OF FEDERAL PROCUREMENT POL20 ICY ACT REQUIREMENT RELATING TO PROCUREMENT

21 INTEGRITY CERTIFICATIONS.—Section 27(e)(7) of

22 the Office of Federal Procurement Policy Act (41

23 U.S.C. 423) is amended by adding at the end the

24 following new subparagraph:
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1 ‘‘(C) This subsection does not apply to a contract for

2 the acquisition of commercial items.’’.

3 (4) CERTAIN PROVISIONS OF THE ANTI-KICK4 BACK ACT OF 1986.—

5 (A) REQUIREMENT FOR CONTRACT

6 CLAUSE.—Section 7 of the Anti-Kickback Act

7 of 1986 (41 U.S.C. 57), as amended by section

8 4024(b), is further amended by inserting before

9 the period at the end of subsection (d) the fol10 lowing: ‘‘or to a prime contract for the acquisi11 tion of commercial items (as defined in section

12 4(12) of such Act (41 U.S.C. 403(12))).’’.

13 (B) INSPECTION AUTHORITY.—Section 8

14 of such Act (41 U.S.C. 58) is amended by add15 ing at the end the following: ‘‘This section does

16 not apply with respect to a prime contract for

17 the acquisition of commercial items (as defined

18 in section 4(12) of the Office of Federal Pro19 curement Policy Act (41 U.S.C. 403(12))).’’.

20 (5) DRUG-FREE WORKPLACE ACT OF 1988.—

21 Section 5152(a)(1) of the Drug-Free Workplace Act

22 of 1988 (subtitle D of title V of Public Law 100–

23 690; 41 U.S.C. 701(a)(1)), as amended by section

24 4024(e), is further amended by inserting after the

25 matter inserted by such section 4024(e) the follow-
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1 ing: ‘‘, other than a contract for the procurement of

2 commercial items (as defined in section 4(12) of

3 such Act (41 U.S.C. 403(12))),’’.

4 (6) CLEAN AIR ACT.—Section 306 of the Clean

5 Air Act (42 U.S.C. 7606) is amended by adding at

6 the end the following new subsection:

7 ‘‘(f)(1) No certification by a contractor, and no con8 tract clause, may be required in the case of a contract

9 for the acquisition of commercial items in order to imple10 ment a prohibition or requirement of this section or a pro11 hibition or requirement issued in the implementation of

12 this section.

13 ‘‘(2) In paragraph (1), the term ‘commercial item’

14 has the meaning given such term in section 4(12) of the

15 Office of Federal Procurement Policy Act (41 U.S.C.

16 403(12)).’’.

17 (7) FLY AMERICAN REQUIREMENTS.—Section

18 1117 of the Federal Aviation Act of 1958 (49

19 U.S.C. App. 1517) is amended by adding at the end

20 the following new subsection:

21 ‘‘(e)(1) No certification by a contractor, and no con22 tract clause, may be required in the case of a contract

23 for the transportation of commercial items in order to im24 plement a requirement in this section.
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1 ‘‘(2) In paragraph (1), the term ‘commercial item’

2 has the meaning given such term in section 4(12) of the

3 Office of Federal Procurement Policy Act (41 U.S.C.

4 403(12)).’’.

5 SEC. 8006. FLEXIBLE DEADLINES FOR SUBMISSION OF OF6 FERS OF COMMERCIAL ITEMS.

7 (a) OFFICE OF FEDERAL PROCUREMENT POLICY

8 ACT AMENDMENT.—Section 18(a) of the Office of Federal

9 Procurement Policy Act (41 U.S.C. 416(a)) is amended

10 by adding at the end the following new paragraph:

11 ‘‘(4) The requirements of paragraph (3)(B) do not

12 apply to contracts for the purchase of commercial items.

13 The Administrator shall prescribe for such contracts ap14 propriate limits on the applicability of a deadline for sub15 mission of bids or proposals that is required by paragraph

16 (1). Such limits shall be incorporated in the Federal Ac17 quisition Regulation. The Federal Acquisition Regulation

18 shall specify a minimum period for submission of a re19 sponse to a solicitation of offers for a contract for the ac20 quisition of commercial items.’’.

21 (b) SAVINGS PROVISION.—The deadlines for submis22 sion of offers that are in effect in accordance with section

23 18(a) of the Office of Federal Procurement Policy Act (41

24 U.S.C. 416(a)) and section 8(e) of the Small Business Act

25 (15 U.S.C. 637(e)) shall continue to apply to contracts
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1 for the purchase of commercial items until the limits pre2 scribed pursuant to paragraph (4) of section 18(a) of the

3 Office of Federal Procurement Policy Act (as added by

4 subsection (a)) are incorporated in the Federal Acquisition

5 Regulation, as required by such paragraph.

6 SEC. 8007. ADVOCATES FOR ACQUISITION OF COMMERCIAL

7 AND NONDEVELOPMENTAL ITEMS.

8 (a) RESPONSIBILITIES OF THE ADVOCATE FOR COM9 PETITION.—Section 20(c) of the Office of Federal Pro10 curement Policy Act (41 U.S.C. 418(c)) is amended to

11 read as follows:

12 ‘‘(c) The advocate for competition for each procuring

13 activity shall be responsible for promoting full and open

14 competition, promoting the acquisition of commercial

15 items and other nondevelopmental items, and challenging

16 barriers to such acquisition, including such barriers as un17 necessarily restrictive statements of need, unnecessarily

18 detailed specifications, and unnecessarily burdensome con19 tract clauses.’’.

20 (b) REPEAL OF SUPERSEDED PROVISION.—Section

21 28 of such Act (41 U.S.C. 424) is repealed.

22 SEC. 8008. PROVISIONS NOT AFFECTED.

23 Nothing in this title shall be construed as amending,

24 modifying, or superseding, or as intended to impair or re25 strict authorities or responsibilities under—
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1 (1) section 111 of the Federal Property and

2 Administrative Services Act of 1949 (40 U.S.C.

3 759), popularly referred to as the ‘‘Brooks Auto4 matic Data Processing Act’’;

5 (2) title IX of the Federal Property and Admin6 istrative Services Act of 1949 (40 U.S.C. 541 et

7 seq.), popularly referred to as the ‘‘Brooks Archi8 tect-Engineers Act’’;

9 (3) subsections (a) and (d) of section 8 of the

10 Small Business Act (15 U.S.C. 637); or

11 (4) the Act of June 25, 1938 (41 U.S.C. 46–

12 48c), that was revised and reenacted in the Act of

13 June 23, 1971 (85 Stat. 77), popularly referred to

14 as the ‘‘Javits-Wagner-O’Day Act’’.

15 SEC. 8009. COMPTROLLER GENERAL REVIEW OF FEDERAL

16 GOVERNMENT USE OF MARKET RESEARCH.

17 (a) REPORT REQUIRED.—Not later than 2 years

18 after the date of the enactment of this Act, the Comptrol19 ler General of the United States shall submit to the Con20 gress a report on the use of market research by the Fed21 eral Government in support of the procurement of com22 mercial items and nondevelopmental items.

23 (b) CONTENT OF REPORT.—The report shall include

24 the following:
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1 (1) A review of existing Federal Government

2 market research efforts to gather data concerning

3 commercial and other nondevelopmental items.

4 (2) A review of the feasibility of creating a Gov5 ernment-wide data base for storing, retrieving, and

6 analyzing market data, including use of existing

7 Federal Government resources.

8 (3) Any recommendations for changes in law or

9 regulations that the Comptroller General considers

10 appropriate.

11 TITLE IX—MISCELLANEOUS

12 PROVISIONS

13 SEC. 9001. COMPTROLLER GENERAL REVIEW OF THE PRO14 VISION OF LEGAL ADVICE FOR INSPECTORS

15 GENERAL.

16 (a) REVIEW AND REPORT REQUIRED.—Not later

17 than March 1, 1995, the Comptroller General of the Unit18 ed States shall—

19 (1) conduct a review of the independence of the

20 legal services being provided to Inspectors General

21 appointed under the Inspector General Act of 1978;

22 and

23 (2) submit to Congress a report on the results

24 of the review.
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1 (b) MATTERS REQUIRED FOR REPORT.—The report

2 shall include the following matters:

3 (1) With respect to each department or agency

4 of the Federal Government that has an Inspector

5 General appointed in accordance with the Inspector

6 General Act of 1978 whose only or principal source

7 of legal advice is the general counsel or other chief

8 legal officer of the department or agency, an assess9 ment of the extent of the independence of the legal

10 advisors providing advice to the Inspector General.

11 (2) A comparison of the findings under the as12 sessment referred to in paragraph (1) with findings

13 on the same matters with respect to each Inspector

14 General whose source of legal advice is legal counsel

15 accountable solely to the Inspector General.

16 SEC. 9002. COST SAVINGS FOR OFFICIAL TRAVEL.

17 (a) The Administrator of the General Services Ad18 ministration, no later than 120 days after enactment of

19 this section, shall issue guidelines to ensure that agencies

20 promote, encourage and facilitate the use of frequent trav21 eler programs offered by airlines, hotels and car rental

22 vendors by Federal employees who engage in official air

23 travel, for the purpose of realizing to the maximum extent

24 practicable cost savings for official travel.
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1 (b) Any awards granted under such a frequent trav2 eler program accrued through official travel shall be used

3 only for official travel.

4 (c) Within one year of enactment of this section, the

5 Administrator shall report to the Congress on efforts to

6 promote the use of frequent traveler programs by Federal

7 employees.

8 SEC. 9003. PROMPT RESOLUTION OF AUDIT RECOMMENDA9 TIONS.

10 Federal agencies shall resolve or take corrective ac11 tion on all Office of Inspector General audit report find12 ings within a maximum of six months after their issuance,

13 or, in the case of audits performed by non-Federal audi14 tors, six months after receipt of the report by the Federal

15 Government.

16 SEC. 9004. UNIFORM SUSPENSION AND DEBARMENT.

17 (a) Within six months after the date of enactment

18 of this Act, regulations shall be issued providing that pro19 visions for the debarment, suspension, or other exclusion

20 of a participant in a procurement activity under the Fed21 eral Acquisition Regulation, or in a nonprocurement activ22 ity under regulations issued pursuant to Executive Order

23 No. 12549, shall have government-wide effect. No agency

24 shall allow a party to participate in any procurement or

25 nonprocurement activity if any agency has debarred, sus-
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1 pended, or otherwise excluded (to the extent specified in

2 the exclusion agreement) that party from participation in

3 a procurement or nonprocurement activity.

4 (b) The Regulations issued pursuant to subsection (a)

5 shall provide that an agency may grant an exception per6 mitting a debarred, suspended, or otherwise excluded

7 party to participate in procurement activities of that agen8 cy to the extent exceptions are authorized under the Fed9 eral Acquisition Regulation, or to participate in

10 nonprocurement activities of that agency to the extent ex11 ceptions are authorized under regulations issued pursuant

12 to Executive Order No. 12549.

13 (c) DEFINITIONS.—For the purposes of this part—

14 (1) ‘‘Procurement activities’’ refers to all acqui15 sition programs and activities of the Federal Gov16 ernment, as defined in the Federal Acquisition Reg17 ulation.

18 (2) ‘‘Nonprocurement activities’’ refers to all

19 programs and activities involving Federal financial

20 and nonfinancial assistance and benefits, as covered

21 by Executive Order No. 12549 and the Office of

22 Management and Budget guidelines implementing

23 that order.

24 (3) ‘‘Agency’’ refers to executive departments

25 and agencies.
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1 TITLE X—EFFECTIVE DATES

2 AND IMPLEMENTATION

3 SEC. 10001. EFFECTIVE DATES.

4 (a) EFFECTIVE DATE OF ACT.—Except as otherwise

5 provided in this Act, this Act shall take effect on the date

6 of the enactment of this Act.

7 (b) EFFECTIVE DATE OF AMENDMENTS.—Except as

8 otherwise provided in this Act, the amendments made by

9 this Act shall take effect on the date on which final imple10 menting regulations are prescribed in accordance with sec11 tion 10002.

12 SEC. 10002. IMPLEMENTING REGULATIONS.

13 (a) PROPOSED CHANGES.—Proposed changes to the

14 Federal Acquisition Regulation and such other proposed

15 regulations (or changes to existing regulations) as may be

16 necessary to implement this Act shall be published in the

17 Federal Register not later than 210 days after the date

18 of the enactment of this Act.

19 (b) PUBLIC COMMENT.—The proposed regulations

20 described in subsection (a) shall be made available for

21 public comment for a period of not less than 60 days.

22 (c) FINAL REGULATIONS.—Final regulations shall be

23 published in the Federal Register not later than 330 days

24 after the date of enactment of this Act.
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1 (d) APPLICABILITY.—(1) The amendments made by

2 this Act shall apply, in the manner prescribed in such final

3 regulations, to any solicitation that is issued or any unso4 licited proposal that is received on or after the date de5 scribed in paragraph (3).

6 (2) The amendments made by this Act shall apply,

7 to the extent and in the manner prescribed in such final

8 regulations, to any matter related to—

9 (A) a contract that is in effect on the date de10 scribed in paragraph (3);

11 (B) an offer under consideration on the date

12 described in paragraph (3); or

13 (C) any other proceeding or action that is ongo14 ing on the date described in paragraph (3).

15 (3) The date referred to in paragraphs (1) and (2)

16 is the date specified in such regulations, which—

17 (A) shall not be earlier than the end of the 30-

18 day period that begins on the date the regulations

19 required by subsection (c) are published; and

20 (B) shall not be later than October 1, 1995.

21 (e) REQUIREMENT FOR CLARITY.—Officers and em22 ployees of the Federal Government who prescribe regula23 tions to implement this Act and the amendments made

24 by this Act shall make every effort practicable to ensure

25 that the regulations are concise and are easily understand-
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1 able by potential offerors as well as by Government offi2 cials.

3 (f) SAVINGS PROVISION.—Nothing in this Act shall

4 be construed to affect the validity of any action taken or

5 any contract entered into prior to the date specified in

6 the regulations pursuant to subsection (d)(3) except to the

7 extent and in the manner prescribed in such regulations.

8 SEC. 10003. EVALUATION BY THE COMPTROLLER GENERAL.

9 (a) EVALUATION RELATING TO ISSUANCE OF REGU10 LATIONS.—Not later than December 1, 1995, the Comp11 troller General shall submit to the committees referred to

12 in subsection (c) a report evaluating compliance with the

13 requirements in section 10002, relating to the issuance of

14 implementing regulations.

15 (b) EVALUATION OF IMPLEMENTATION OF REGULA16 TIONS.—Not later than December 1, 1996, the Comptrol17 ler General shall submit to the committees referred to in

18 subsection (c) a report evaluating the effectiveness of the

19 regulations implementing this Act in streamlining the ac20 quisition system and fulfilling the other purposes of this

21 Act. The report shall include the Comptroller General’s

22 evaluation of the extent to which the departments and

23 agencies of the Federal Government, in implementing this

24 Act and the amendments made by this Act, are reducing

25 acquisition management layers and associated costs.
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1 (c) COMMITTEES DESIGNATED TO RECEIVE THE RE2 PORTS.—The Comptroller General shall submit the re3 ports required by this section to the Committees on Armed

4 Services and on Governmental Affairs of the Senate and

5 the Committees on Small Business on Government Oper6 ations of the House of Representatives.

7 SEC. 10004. DATA COLLECTION THROUGH THE FEDERAL

8 PROCUREMENT DATA SYSTEM.

9 (a) DATA COLLECTION REQUIRED.—The Federal

10 Procurement Data System described in section 6(d)(4)(A)

11 of the Office of Federal Procurement Policy Act (41

12 U.S.C. 405(d)(4)(A)) shall be modified to collect from con13 tracts in excess of the simplified acquisition threshold data

14 pertaining to the following matters:

15 (1) Contract awards made pursuant to competi16 tions conducted pursuant to section 2323 of title 10,

17 United States Code, or section 8(c) of the Small

18 Business Act (15 U.S.C. 637(c)).

19 (2) Awards to business concerns owned and

20 controlled by women.

21 (3) Number of offers received in response to a

22 solicitation.

23 (4) Task order contracts.

24 (5) Contracts for the acquisition of commercial

25 items.
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1 (b) DEFINITION.—In this section, the term ‘‘sim2 plified acquisition threshold’’ has the meaning given such

3 term in section 4 of the Office of Federal Procurement

4 Policy Act (41 U.S.C. 403).

5 TITLE XI—WAIVER OF THE AP6 PLICATION OF THE PREVAIL7 ING WAGE-SETTING REQUIRE8 MENTS TO VOLUNTEERS

9 SEC. 11001. SHORT TITLE.

10 This title may be cited as the ‘‘Community Improve11 ment Volunteer Act of 1994’’.

12 SEC. 11002. PURPOSE.

13 It is the purpose of this title to promote and provide

14 more opportunities for people who wish to volunteer their

15 services in the construction, repair or alteration (including

16 painting and decorating) of public buildings and public

17 works funded, in whole or in part, with Federal financial

18 assistance authorized under certain Federal programs that

19 might not otherwise be possible without the use of volun20 teers, by waiving the application of the otherwise applica21 ble prevailing wage-setting provisions of the Act of March

22 3, 1931 (commonly known as the ‘‘Davis-Bacon Act’’) (40

23 U.S.C. 276a et seq.) to such volunteers.
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1 SEC. 11003. WAIVER.

2 (a) IN GENERAL.—The requirement that certain la3 borers and mechanics be paid in accordance with the

4 wage-setting provisions of the Act of March 3, 1931 (com5 monly known as the ‘‘Davis-Bacon Act’’) (40 U.S.C. 276a

6 et seq.) as set forth in any of the Acts or provisions de7 scribed in subsection (d), and the provisions relating to

8 wages, in any federally assisted or insured contract or sub9 contract for construction, shall not apply to any individ10 ual—

11 (1) who volunteers—

12 (A) to perform a service for a public or

13 private entity for civic, charitable, or humani14 tarian reasons, without promise, expectation, or

15 receipt of compensation for services rendered

16 other than expenses, reasonable benefits, or a

17 nominal fee (as defined in subsection (b)), but

18 solely for the personal purpose or pleasure of

19 the individual; and

20 (B) to provide such services freely and

21 without pressure or coercion, direct or implied,

22 from an employer;

23 (2) whose contribution of service is not for the

24 benefit of any contractor otherwise performing or

25 seeking to perform work on the same project; and
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1 (3) who is not otherwise employed at any time

2 under the federally assisted or insured contract or

3 subcontract involved for construction with respect to

4 the project for which the individual is volunteering.

5 (b) EXPENSES.—Payments of expenses, reasonable

6 benefits, or a nominal fee may be provided to volunteers

7 described in subsection (a) if the Secretary of Labor deter8 mines, after an examination of the total amount of pay9 ments made (relating to expenses, benefits, or fees) in the

10 context of the economic realities of the specific federally

11 assisted or insured project, that such payments are appro12 priate. Subject to such a determination—

13 (1) a payment for an expense may be received

14 by a volunteer for items such as uniform allowances,

15 protective gear and clothing, reimbursement for ap16 proximate out-of-pocket expenses, or for the cost or

17 expense of meals and transportation;

18 (2) a reasonable benefit may include the inclu19 sion of a volunteer in a group insurance plan (such

20 as a liability, health, life, disability, or worker’s com21 pensation plan) or pension plan, or the awarding of

22 a length of service award; and

23 (3) a nominal fee may not be used as a sub24 stitute for compensation and may not be tied to pro25 ductivity.
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1 The decision as to what constitutes a nominal fee for pur2 poses of paragraph (3) shall be made on a case-by-case

3 basis and in the context of the economic realities of the

4 situation involved.

5 (c) ECONOMIC REALITY.—For purposes of subsection

6 (b), in determining whether an expense, benefit, or fee de7 scribed in such subsection may be paid to volunteers in

8 the context of the economic realities of the particular situ9 ation, the Secretary of Labor shall not approve any such

10 expense, benefit, or fee that has the effect of undermining

11 labor standards by creating downward pressure on prevail12 ing wages in the local construction industry.

13 (d) CONTRACTS EXEMPTED.—For purposes of sub14 section (a), the Acts or provisions described in this sub15 section are the following:

16 (1) The Library Services and Construction Act

17 (20 U.S.C. 351 et seq.).

18 (2) The Indian Self-Determination and Edu19 cation Assistance Act (25 U.S.C. 450 et seq.).

20 (3) Section 329 of the Public Health Service

21 Act (42 U.S.C. 254b).

22 (4) Section 330 of the Public Health Service

23 Act (42 U.S.C. 254c).
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1 SEC. 11004. REPORT.

2 Not later than December 31, 1997, the Secretary of

3 Labor shall prepare and submit to the appropriate com4 mittees of Congress a report that—

5 (1) identifies and assesses, to the maximum ex6 tent practicable—

7 (A) the projects for which volunteers were

8 permitted to work under this title; and

9 (B) the number of volunteers permitted to

10 work because of the compliance of entities with

11 the provisions of this title; and

12 (2) contains recommendations with respect to

13 Acts related to the Davis-Bacon Act that could be

14 addressed to permit volunteer work.

Passed the Senate June 8 (legislative day, June 7),

1994.

Attest:

Secretary.
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