II

103D CONGRESS

1ST SESSION S. 1587

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

and for other purposes.

IN THE SENATE OF THE UNITED STATES

OCTOBER 26 (legislative day, OCTOBER 13), 1993

Mr. GLENN (for himself, Mr. BINGAMAN, Mr. LEVIN, Mr. NUNN, Mr. BUMPERS, and Mr. LIEBERMAN) introduced the following bill; which was read

twice and referred to the Committee on Governmental Affairs

NOVEMBER 1 (legislative day, OCTOBER 13), 1993

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

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

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

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

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

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

A BILL

To revise and streamline the acquisition laws of the Federal

Government, and for other purposes.

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

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

3 Streamlining Act of 1993’’.

4 SEC. 2. TABLE OF CONTENTS.

5 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. Exclusion of particular sources.

Sec. 1003. Approval for use of noncompetitive procedures.

Sec. 1004. Reference to head of a contracting activity.

Sec. 1005. Task and delivery order contracts.

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.

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. Encouragement of competition and cost savings.

Sec. 1032. 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. Exclusion of particular sources.

Sec. 1053. Approval for use of noncompetitive procedures.

Sec. 1054. Reference to head of a contracting activity.

Sec. 1055. Task and delivery order contracts.
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SUBPART B—PLANNING, SOLICITATION, EVALUATION, AND AWARD

Sec. 1061. Solicitation, evaluation, and award.

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

Sec. 1063. Prompt notice of award.

Sec. 1064. Post-award debriefings.

Sec. 1065. Protest file.

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

SUBPART C—KINDS OF CONTRACTS

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

contract.

PART III—ACQUISITIONS GENERALLY

Sec. 1091. 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. 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. Delegation of contracting authority.

Sec. 1302. Research projects.

Sec. 1303. Elimination of inflexible terminology regarding coordination and

communication of defense research activities.

Subtitle D—Procurement Protests

PART I—PROTESTS TO THE COMPTROLLER GENERAL

Sec. 1401. Protest defined.

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

Sec. 1403. Decisions on protests.

Sec. 1404. Regulations.

PART II—PROTESTS IN THE FEDERAL COURTS

Sec. 1421. Nonexclusivity of remedies.

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

Sec. 1440. Oversight of acquisition of automatic data processing equipment by

Federal agencies.

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.

Sec. 1507. Repeal of executed requirement relating to certificate of independent

price determination in certain Department of Defense contract

solicitations.

PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 1551. Definitions.

Sec. 1552. Delegation of procurement functions.

Sec. 1553. Determinations and decisions.

Sec. 1554. Undefinitized contractual actions: restrictions.

Sec. 1555. Repeal of amendments to uncodified title.

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
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Sec. 2151. Allowable contract costs.

PART III—ACQUISITIONS GENERALLY

Sec. 2191. Travel expenses of government contractors.

Subtitle C—Audit and Access to Records

PART I—ARMED SERVICES ACQUISITIONS

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

PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 2251. Authority to examine records of contractors.

Subtitle D—Cost Accounting Standards

Sec. 2301. 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.

Sec. 2403. Repeal of requirement for complete delivery of subsistence supplies

at specific place upon inspection.

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.

PART II—ACQUISITIONS GENERALLY

Sec. 2551. Concurrent jurisdiction of United States district courts under the

Little Tucker Act.

Sec. 2552. Contract Disputes Act improvements.

TITLE III—SERVICE SPECIFIC AND MAJOR SYSTEMS

STATUTES

Subtitle A—Major Systems Statutes

Sec. 3001. Requirement for independent cost estimates and manpower estimates before development or production.

Sec. 3002. Enhanced program stability.
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Sec. 3003. Repeal of requirement for 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. Repeal of testing requirement for wheeled or tracked vehicles.

Sec. 3012. Major systems and munitions programs: survivability and lethality

testing.

Sec. 3013. Operational test and evaluation of defense acquisition programs.

Sec. 3014. Low-rate initial production of new systems.

Subtitle C—Service Specific Laws

Sec. 3021. Industrial mobilization.

Sec. 3022. Industrial mobilization: plants; lists; Board on Mobilization of Industries Essential for Military Preparedness.

Sec. 3023. Procurement for experimental purposes.

Sec. 3024. Repeal of authority for procurement of production equipment.

Sec. 3025. Availability of Department of Defense samples, drawings, information, equipment, materials, and certain services.

Sec. 3026. Repeal of duplicative general procurement authority.

Sec. 3027. Repeal of authority to delegate the procurement of Army rations.

Sec. 3028. Repeal of authority to purchase exceptional subsistence supplies

without advertising.

Sec. 3029. Repeal of authority to obtain assistance of United States mapping

agencies.

Sec. 3030. Repeal of authority to reclaim unserviceable ammunition.

Sec. 3031. Gratuitous services of officers of certain reserve components.

Sec. 3032. Civil Reserve Air Fleet.

Sec. 3033. Repeal of Navy authority regarding research and development, procurement, and construction of guided missiles.

Sec. 3034. Exchange of scientific personnel.

Sec. 3035. Repeal of authority for Secretary of the Navy to provide temporary

relief for contractors and contractor employees from losses

caused by enemy action.

Sec. 3036. Repeal of authority for Secretary of the Navy to sell degaussing

equipment.

Sec. 3037. Repeal of authority for alternative use of appropriations for construction or conversion of vessels.

Sec. 3038. Repeal of authority for conversion of combatant and auxiliary naval

vessels.

Sec. 3039. Construction of combatant and escort vessels and assignment of vessel projects.

Sec. 3040. Repeal of requirement for estimates in connection with bids on construction of naval vessels.

Sec. 3041. Repeal of requirement for construction of vessels on Pacific coast.

Sec. 3042. Fitness of naval vessels: examination; striking unfit vessels; disposal.

Sec. 3043. Repeal of policy on constructing combatant vessels.

Sec. 3044. Naval salvage facilities.

Subtitle D—Department of Defense Commercial and Industrial

Activities
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Sec. 3051. Factories and arsenals: manufacture at.

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

Subtitle E—Fuel- and Energy-Related Laws

Sec. 3061. Liquid fuels and natural gas: contracts for storage, handling, or distribution.

Sec. 3062. Acquisition of petroleum and natural gas: authority to waive procedures.

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 provisions for the encouragement of aviation.

Sec. 3083. Repeal of requirements regarding product evaluation activities.

Sec. 3084. Repeal of price adjustment authority and purchase authority relating to the procurement of milk.

Sec. 3085. Codification and revision of limitation on lease of vessels, aircraft,

and vehicles.

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. Procurement notice.

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

SIMPLIFIED ACQUISITION THRESHOLD

SUBPART A—GENERALLY

Sec. 4021. Inapplicability of future enacted procurement laws to contracts not

exceeding the simplified acquisition threshold.

SUBPART B—ARMED SERVICES ACQUISITIONS

Sec. 4031. Inapplicability of requirement for contract clause regarding contingent fees.

Sec. 4032. Inapplicability of prohibition on limiting subcontractor direct sales

to the United States.

Sec. 4033. Inapplicability of authority to examine books and records of contractors.
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Sec. 4034. Inapplicability of requirement to identify suppliers and sources of

supplies.

Sec. 4035. Inapplicability of prohibition against doing business with certain

offerors or contractors.

Sec. 4036. Inapplicability of preference for use of United States vessels for

transporting supplies of the Armed Forces.

SUBPART C—CIVILIAN AGENCY ACQUISITIONS

Sec. 4041. Inapplicability of requirement for contract clause regarding contingent fees.

Sec. 4042. Inapplicability of prohibition on limiting subcontractor direct sales

to the United States.

Sec. 4043. Inapplicability of authority to examine books and records of contractors.

SUBPART D—ACQUISITIONS GENERALLY

Sec. 4051. Inapplicability of limitation on use of funds to influence certain Federal actions.

Sec. 4052. Inapplicability of requirement for contract clause relating to kickbacks.

Sec. 4053. Inapplicability of the Miller Act to contracts below the simplified acquisition threshold.

Sec. 4054. Inapplicability of Contract Work Hours and Safety Standards Act.

Sec. 4055. Inapplicability of the Drug-Free Workplace Act of 1988.

Sec. 4056. Inapplicability of a requirement in the Merchant Marine Act, 1936,

to ship on American-flag commercial vessels.

Sec. 4057. Inapplicability of certain procurement integrity requirements.

PART IV—CONFORMING AMENDMENTS

Sec. 4071. Armed services acquisitions.

Sec. 4072. Civilian agency acquisitions.

Sec. 4073. Office of Federal Procurement Policy Act.

Sec. 4074. Small Business Act.

PART V—REVISION OF REGULATIONS

Sec. 4081. Revision required.

Subtitle B—Socioeconomic and Small Business Laws

Sec. 4101. Armed services acquisitions.

Sec. 4102. Acquisitions generally.

Sec. 4103. Direct contracting with small businesses.

Subtitle C—Miscellaneous Acquisition Laws

Sec. 4151. Repeal of obsolete laws relating to procurement of naval aircraft and

components.

Sec. 4152. Revision and codification of prohibition on use of funds for documenting economic or employment impact of certain acquisition

programs.

Sec. 4153. Restriction on use of noncompetitive procedures for procurement

from a particular source.

TITLE V—INTELLECTUAL PROPERTY
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Subtitle A—Technology Transfer

Sec. 5001. Copyright protection for computer programs of the Federal Government.

Sec. 5002. Use of copyrighted works of the Federal Government.

Sec. 5003. Distribution of royalties received by Federal agencies.

Sec. 5004. Exception to prohibition on copyright protection for works of the

Federal Government.

Subtitle B—Government Use of Private Patents, Copyrights,

and Trade Secrets

Sec. 5011. Government use or manufacture of a patented invention.

Sec. 5012. 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. Waiting period for significant changes proposed for acquisition regulations.

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. Advocate for Acquisition of Commercial and Nondevelopmental

Items.

Sec. 8008. Provisions not affected.

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

research.

TITLE IX—EFFECTIVE DATE

Sec. 9001. Effective date.
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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’’.

17 SEC. 1002. EXCLUSION OF PARTICULAR SOURCES.

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

19 amended—

20 (1) by redesignating paragraphs (2) and (3) as

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

22 (2) by inserting after paragraph (1) the follow23 ing new paragraph (2):
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1 ‘‘(2) The determination required of the head of an

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

3 purchases or contracts.’’; and

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

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

7 (3)’’.

8 SEC. 1003. APPROVAL FOR USE OF NONCOMPETITIVE PRO9 CEDURES.

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

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

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

13 (ii), (iii), or (iv)’’.

14 SEC. 1004. REFERENCE TO HEAD OF A CONTRACTING AC15 TIVITY.

16 Section 2304(f) of title 10, United States Code, is

17 amended—

18 (1) in paragraph (1)(B)(ii)—

19 (A) by striking out ‘‘head of the procuring

20 activity’’ and inserting in lieu thereof ‘‘head of

21 the contracting activity’’; and

22 (B) by striking out ‘‘head of the procuring

23 activity’s’’ and inserting in lieu thereof ‘‘head of

24 the contracting activity’s’’; and
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1 (2) in paragraph (6)(A), by striking out ‘‘head

2 of a procuring activity’’ and inserting in lieu thereof

3 ‘‘head of a contracting activity’’.

4 SEC. 1005. TASK AND DELIVERY ORDER CONTRACTS.

5 (a) AUTHORITY.—

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

7 United States Code, is amended by inserting after

8 section 2304 the following new section:

9 ‘‘§ 2304a. Task and delivery order contracts

10 ‘‘(a) AUTHORITY TO AWARD.—Subject to the re11 quirements of this section, the head of an agency may

12 enter into a contract that does not procure or specify a

13 firm quantity of supplies or services (other than a mini14 mum or maximum quantity) and that provides for the is15 suance of delivery orders or task orders during the speci16 fied period of the contract. The head of an agency may

17 enter into such a contract only under the authority of this

18 section.

19 ‘‘(b) LIMITATION ON CONTRACT PERIOD.—The pe20 riod of a contract referred to in subsection (a), including

21 all periods of extensions of the contract under options,

22 modifications, or otherwise, may not exceed 3 years, ex23 cept that, when multiple contracts are awarded under sub24 section (c)(4) pursuant to the same solicitation, the period
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1 of each such contract may exceed 3 years but may not

2 exceed 5 years.

3 ‘‘(c) AWARD PROCEDURES.—(1) The head of an

4 agency may use procedures other than competitive proce5 dures to enter into a contract referred to in subsection

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

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

8 procedures is approved in accordance with subsection (f)

9 of such section.

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

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

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

13 shall reasonably and fairly describe the general scope,

14 magnitude, and duration of the proposed contract in a

15 manner that would reasonably enable a potential offeror

16 to decide whether to request the solicitation and consider

17 submitting an offer.

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

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

20 number of options to extend the contract and the pe21 riod for which the contract may be extended under

22 each option, if any.

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

24 supplies or services to be procured under the con25 tract.
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1 ‘‘(C) A statement of work, specifications, or

2 other description that reasonably describes the gen3 eral scope, nature, complexity, and purposes of the

4 supplies or services to be procured under the con5 tract.

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

7 one solicitation, award separate contracts under this sec8 tion for the same or similar supplies or services to two

9 or more sources if the solicitation states that the head of

10 the agency has the option to do so.

11 ‘‘(B) In any solicitation for an advisory and assist12 ance services contract for a period in excess of 1 year,

13 or for an amount (including all options) in excess of

14 $10,000,000, the head of an agency shall include a state15 ment that the head of the agency reserves the option—

16 ‘‘(i) to award separate contracts under subpara17 graph (A); or

18 ‘‘(ii) to award only one contract if the head of

19 the agency determines in writing that only one of

20 the offerers is capable of providing the services re21 quired at the level of quality required.

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

23 contain the same information that is required by para24 graph (3) to be included in the solicitation of offers for

25 that contract.
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1 ‘‘(d) ORDERS.—(1) The following actions are not re2 quired for a delivery order or task order issued under a

3 contract entered into in accordance with this section:

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

5 section 18 of the Office of Federal Procurement Pol6 icy Act (41 U.S.C. 416) or section 8(e) of the Small

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

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

9 competition (or a waiver of competition approved in

10 accordance with section 2304(f) of this title) that is

11 separate from that used for entering into the con12 tract.

13 ‘‘(2)(A) When multiple contracts are awarded under

14 subsection (c)(4), each delivery order or task order issued

15 under such contracts shall be competed among all of the

16 contractors awarded such contracts unless the contracting

17 officer determines in writing that—

18 ‘‘(i) the agency’s need for the supplies or serv19 ices ordered is of such unusual urgency that com20 petition would result in unacceptable delays in fulfill21 ing the agency’s needs;

22 ‘‘(ii) the supplies or services ordered are so

23 unique or highly specialized that only one such con24 tractor is capable of providing the supplies or serv25 ices required at the level of quality required; or
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1 ‘‘(iii) the delivery order or task order should be

2 issued on a sole-source basis in the interest of econ3 omy and efficiency because it is a logical follow-on

4 to a delivery order or task order already issued on

5 a competitive basis.

6 ‘‘(B) When a delivery order or task order is competed

7 pursuant to subparagraph (A), the order shall include a

8 statement of work that clearly specifies all tasks to be per9 formed under the order.

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

11 the issuance, proposed issuance, or competing of a delivery

12 order or task order except for a protest on the ground

13 that the order increases the scope, period, or maximum

14 value of the contract under which the order is issued.

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

16 VALUE OF CONTRACT.—(1) A delivery order or task order

17 may not increase the scope, period, or maximum value of

18 the contract under which the order is issued. The scope,

19 period, or maximum value of the contract may be in20 creased only by modification of the contract.

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

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

23 of section 2304 of this title and approved in accordance

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

25 shall be used for making such a modification.
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1 ‘‘(3) Notice regarding the modification shall be pro2 vided in accordance with section 18 of the Office of Fed3 eral Procurement Policy Act (41 U.S.C. 416) and section

4 8(e) of the Small Business Act (15 U.S.C. 637(e)).

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

6 agency who awards multiple contracts under subsection

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

8 who shall be responsible for reviewing complaints from the

9 contractors on such contracts and ensuring that task or10 ders are issued on a competitive basis when required under

11 subsection (d)(2). The task order ombudsman shall be a

12 senior agency official who is independent of the contract13 ing officer for the contracts and may be the agency’s com14 petition advocate.’’.

15 (2) CLERICAL AMENDMENT.—The table of sec16 tions at the beginning of such chapter is amended

17 by inserting after the item relating to section 2304

18 the following new item:

‘‘2304a. Task and delivery order contracts.’’.

19 (b) REPEAL OF SUPERSEDED PROVISION.—Section

20 2304 of title 10, United States Code, is amended by strik21 ing out subsection (j).

22 (c) CONFORMING AMENDMENT FOR PROFESSIONAL

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

24 United States Code, is amended by striking out subsection

25 (c).
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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, and prior experience of

9 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 price or cost, when com15 bined, are—

16 ‘‘(I) significantly more important than

17 price or cost;

18 ‘‘(II) approximately equal in importance to

19 price or cost; or

20 ‘‘(III) significantly less important than

21 price or cost.

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 price or

7 cost.’’.

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 under the contract for options to

18 purchase additional supplies or services under the contract

19 unless the head of the agency has determined that there

20 is a reasonable likelihood that the options will be exer21 cised.’’.

22 (b) REPEAL OF SUPERSEDED PROVISION.—Section

23 2301(a) of such title is amended—

24 (1) by striking out paragraph (7);
21

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

2 (5); and

3 (3) by striking out ‘‘; and’’ at the end of para4 graph (6) and inserting in lieu thereof a period.

5 SEC. 1013. PROMPT NOTICE OF AWARD.

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

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

8 the end the following: ‘‘Within 3 days after the date of

9 contract award, the head of the agency shall notify all

10 offerors not awarded the contract that the contract has

11 been awarded.’’.

12 (b) COMPETITIVE PROPOSALS PROCEDURES.—Sec13 tion 2305(b)(4)(B) of title 10, United States Code, is

14 amended in the second sentence by striking out ‘‘shall

15 promptly notify’’ and inserting in lieu thereof ‘‘, within

16 3 days after the date of contract award, shall notify’’.

17 SEC. 1014. POST-AWARD DEBRIEFINGS.

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

19 amended—

20 (1) by redesignating paragraph (5) as para21 graph (6); and

22 (2) by inserting after paragraph (4) the follow23 ing new paragraph (5):

24 ‘‘(5)(A) When a contract is awarded by an agency

25 on the basis of competitive proposals, an unsuccessful
22

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1 offeror, upon written request received by the agency within

2 7 days after the date of contract award, shall be debriefed

3 and furnished the basis for the selection decision and con4 tract award. An employee of the agency shall debrief the

5 offeror within 7 days after receipt of the request by the

6 agency.

7 ‘‘(B) The debriefing shall provide the offeror with—

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

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

10 ‘‘(ii) the overall evaluated cost of the offer of

11 the contractor awarded the contract and the overall

12 evaluated cost of the offer of the debriefed offeror;

13 ‘‘(iii) the overall ranking of all offers and the

14 total technical and cost scores of all offers;

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

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

17 equipment that is a commercial item, the make and

18 model of the item incorporated in the offer of the

19 contractor awarded the contract; and

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

21 the debriefed offeror as to whether source selection

22 procedures set forth in the solicitation, applicable

23 regulations, and other applicable authorities were

24 followed by the agency.
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1 ‘‘(C) The debriefing may not include point-by-point

2 comparisons of the debriefed offeror’s offer with other of3 fers and may not disclose any information that is exempt

4 from disclosure under section 552 of title 5, including in5 formation relating to—

6 ‘‘(i) trade secrets;

7 ‘‘(ii) privileged or confidential manufacturing

8 processes and techniques; and

9 ‘‘(iii) commercial and financial information that

10 is privileged or confidential, including cost break11 downs, profit, indirect cost rates, and similar infor12 mation.

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

14 include a statement that information described in subpara15 graph (B) may be disclosed in post-award debriefings.

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

17 award and as a result of a successful procurement protest

18 or otherwise, the agency seeks to fulfill the requirement

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

20 of offers or on the basis of the best and final offers consid21 ered in the awarding of that contract, the agency shall

22 provide each such offeror with—

23 ‘‘(i) all information provided in debriefings

24 under this paragraph regarding the offer of the con25 tractor awarded the contract; and
24

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1 ‘‘(ii) all comparable information with respect to

2 the original offerors.

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

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

5 SEC. 1015. PROTEST FILE.

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

7 amended by adding at the end the following:

8 ‘‘(e)(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, the head of an agency, a protest is filed pursuant to

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

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

13 the protest shall be established by the contracting activity

14 and reasonable access shall be provided to actual or pro15 spective offerors.

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

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

18 pursuant to paragraph (1) unless an applicable protective

19 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 the Contract Disputes

25 Act of 1978 (41 U.S.C. 601 et seq.).’’.
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1 SEC. 1016. AWARD OF COSTS AND FEES IN AGENCY SETTLE2 MENT OF PROTESTS.

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

4 amended by section 1015, is further amended by adding

5 at the end the following new subsection:

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

7 agency determines that a solicitation, proposed award, or

8 award does not satisfy the requirements of law or regula9 tion, the head of the agency may take any action set out

10 in subparagraphs (A) through (F) of section 3554(b)(1)

11 of title 31.’’.

12 Subpart C—Kinds of Contracts

13 SEC. 1021. SECRETARIAL DETERMINATION REGARDING

14 USE OF COST TYPE OR INCENTIVE CON15 TRACT.

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

17 States Code, is repealed.

18 SEC. 1022. TECHNICAL AND CONFORMING AMENDMENTS.

19 (a) REPEAL OF UNNECESSARY CROSS REF20 ERENCE.—Subsection (f) of section 2306 of title 10, Unit21 ed States Code, is repealed.

22 (b) CONFORMING AMENDMENT.—Such section is

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

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

25 (c) NEUTERIZATION OF REFERENCE.—Subsection

26 (e)(1) of such section, as redesignated by subsection (b),
26

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

2 ‘‘whenever he finds’’ and inserting in lieu thereof ‘‘when3 ever the head of the agency finds’’.

4 Subpart D—Miscellaneous Provisions for the

5 Encouragement of Competition

6 SEC. 1031. ENCOURAGEMENT OF COMPETITION AND COST

7 SAVINGS.

8 (a) TRANSFER.—The text of section 2317 of title 10,

9 United States Code—

10 (1) is amended—

11 (A) by striking out ‘‘The Secretary of De12 fense’’ and inserting in lieu thereof ‘‘(c) EN13 COURAGEMENT OF COMPETITION AND COST

14 SAVINGS.—The Secretary’’; and

15 (B) by striking out ‘‘contracts covered by

16 this chapter’’ and inserting in lieu thereof ‘‘con17 tracts of the Department of Defense’’; and

18 (2) is transferred to section 1701 of title 10,

19 United States Code, and inserted at the end of such

20 section.

21 (b) CLERICAL AMENDMENTS.—Chapter 137 of title

22 10, United States Code, is amended—

23 (1) by striking out the section heading of sec24 tion 2317; and
27

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1 (2) in the table of sections at the beginning of

2 such chapter, by striking out the item relating to

3 section 2317.

4 SEC. 1032. REPEAL OF REQUIREMENT FOR ANNUAL RE5 PORT BY ADVOCATES FOR COMPETITION.

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

7 States Code, is repealed.

8 PART II—CIVILIAN AGENCY ACQUISITIONS

9 Subpart A—Competition Requirements

10 SEC. 1051. REFERENCES TO FEDERAL ACQUISITION REGU11 LATION.

12 Section 303 of the Federal Property and Administra13 tive Services Act of 1949 (41 U.S.C. 253) is amended—

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

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

16 1984’’ and inserting in lieu thereof ‘‘Federal Acqui17 sition Regulation’’; and

18 (2) in subsection (g)(1), by striking out ‘‘regu19 lations modified’’ and all that follows through ‘‘of

20 1984,’’ and inserting in lieu thereof ‘‘Federal Acqui21 sition Regulation’’.

22 SEC. 1052. EXCLUSION OF PARTICULAR SOURCES.

23 Section 303(b) of the Federal Property and Adminis24 trative Services Act of 1949 (41 U.S.C. 253(b)) is amend25 ed—
28

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

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

3 (2) by inserting after paragraph (1) the follow4 ing new paragraph (2):

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

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

7 or contracts.’’; and

8 (3) in paragraph (4), as redesignated by para9 graph (1), by striking out ‘‘paragraphs (1) and (2)’’

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

11 (3)’’.

12 SEC. 1053. APPROVAL FOR USE OF NONCOMPETITIVE PRO13 CEDURES.

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

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

16 253(f)(1)(B)(i)) is amended by inserting before the semi17 colon at the end the following: ‘‘or by an official referred

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

19 SEC. 1054. REFERENCE TO HEAD OF A CONTRACTING AC20 TIVITY.

21 Section 303(f)(1)(B)(ii) of the Federal Property and

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

23 253(f)(1)(B)(ii)) is amended by striking out ‘‘head of the

24 procuring activity’’ and inserting in lieu thereof ‘‘head of

25 the contracting activity’’.
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1 SEC. 1055. TASK AND DELIVERY ORDER CONTRACTS.

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

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

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

5 following new section:

6 ‘‘TASK AND DELIVERY ORDER CONTRACTS

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

8 to the requirements of this section, an agency head may

9 enter into a contract that does not procure or specify a

10 firm quantity of supplies or services (other than a mini11 mum or maximum quantity) and that provides for the is12 suance of delivery orders or task orders during the speci13 fied period of the contract. The agency head may enter

14 into such a contract only under the authority of this sec15 tion.

16 ‘‘(b) CONTRACT PERIOD NOT TO EXCEED 3

17 YEARS.—The period of a contract referred to in sub18 section (a), including all periods of extensions of the con19 tract under options, modifications, or otherwise, may not

20 exceed 3 years, except that, when multiple contracts are

21 awarded under subsection (c)(4) pursuant to the same so22 licitation, the period of each such contract may exceed 3

23 years but may not exceed 5 years.

24 ‘‘(c) AWARD PROCEDURES.—(1) An agency head may

25 use procedures other than competitive procedures to enter

26 into a contract referred to in subsection (a) only if an ex-
30

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1 ception in subsection (c) of section 303 applies to the con2 tract and the use of such procedures is approved in ac3 cordance with subsection (f) of such section.

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

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

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

7 shall reasonably and fairly describe the general scope,

8 magnitude, and duration of the proposed contract in a

9 manner that would reasonably enable a potential offeror

10 to decide whether to request the solicitation and consider

11 submitting an offer.

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

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

14 number of options to extend the contract and the pe15 riod for which the contract may be extended under

16 each option, if any.

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

18 supplies or services to be procured under the con19 tract.

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

21 other description that reasonably describes the gen22 eral scope, nature, complexity, and purposes of the

23 supplies or services to be procured under the con24 tract.
31

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1 ‘‘(4)(A) An agency head may, on the basis of one so2 licitation, award separate contracts under this section for

3 the same or similar supplies or services to two or more

4 sources if the solicitation states that the agency head has

5 the option to do so.

6 ‘‘(B) In any solicitation for an advisory and assist7 ance services contract for a period in excess of 1 year,

8 or for an amount (including all options) in excess of

9 $10,000,000, an agency head shall—

10 ‘‘(i) provide for a multiple award under sub11 paragraph (A); and

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

13 may also elect to award only one contract if the

14 agency head determines in writing that only one of

15 the offerers is capable of providing the services re16 quired at the level of quality required.

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

18 contain the same information that is required by para19 graph (3) to be included in the solicitation of offers for

20 that contract.

21 ‘‘(d) ORDERS.—(1) The following actions are not re22 quired for a delivery order or task order issued under a

23 contract entered into in accordance with this section:

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

25 section 18 of the Office of Federal Procurement Pol-
32

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1 icy Act (41 U.S.C. 416) or section 8(e) of the Small

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

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

4 competition (or a waiver of competition approved in

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

6 from that used for entering into the contract.

7 ‘‘(2)(A) When multiple contracts are awarded under

8 subsection (c)(4), each delivery order or task order issued

9 under such contracts shall be competed among all of the

10 contractors awarded such contracts unless the contracting

11 officer determines in writing that—

12 ‘‘(i) the agency’s need for the supplies or serv13 ices ordered is of such unusual urgency that com14 petition would result in unacceptable delays in fulfill15 ing the agency’s needs;

16 ‘‘(ii) the supplies or services ordered are so

17 unique or highly specialized that only one such con18 tractor is capable of providing the supplies or serv19 ices required at the level of quality required; or

20 ‘‘(iii) the delivery order or task order should be

21 issued on a sole-source basis in the interest of econ22 omy and efficiency because it is a logical follow-on

23 to a delivery order or task order already issued on

24 a competitive basis.
33

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1 ‘‘(B) When a delivery order or task order is competed

2 pursuant to subparagraph (A), the order shall include a

3 statement of work that clearly specifies all tasks to be per4 formed under the order.

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

6 the issuance, proposed issuance, or competing of a delivery

7 order or task order except for a protest on the ground

8 that the order increases the scope, period, or maximum

9 value of the contract under which the order is issued.

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

11 VALUE OF CONTRACT.—(1) A delivery order or task order

12 may not increase the scope, period, or maximum value of

13 the contract under which the order is issued. The scope,

14 period, or maximum value of the contract may be in15 creased only by modification of the contract.

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

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

18 of section 303 and approved in accordance with subsection

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

20 for making such a modification.

21 ‘‘(3) Notice regarding the modification shall be pro22 vided in accordance with section 18 of the Office of Fed23 eral Procurement Policy Act (41 U.S.C. 416) and section

24 8(e) of the Small Business Act (15 U.S.C. 637(e)).
34

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

2 who awards multiple contracts under subsection (c)(4)

3 shall appoint or designate a task order ombudsman who

4 shall be responsible for reviewing complaints from the con5 tractors on such contracts and ensuring that task orders

6 are issued on a competitive basis when required under sub7 section (d)(2). The task order ombudsman shall be a sen8 ior agency official who is independent of the contracting

9 officer for the contracts and may be the agency’s competi10 tion advocate.’’.

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

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

13 relating to section 303G the following new item:

‘‘Sec. 303H. Task and delivery order contracts.’’.

14 Subpart B—Planning, Solicitation, Evaluation, and

15 Award

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

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

18 the Federal Property and Administrative Services Act of

19 1949 (41 U.S.C. 253a) is amended—

20 (1) in subsection (b)(1)(A)—

21 (A) by inserting ‘‘and significant

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

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

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

25 or price-related factors and subfactors, and
35

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1 noncost-related or nonprice-related factors and

2 subfactors)’’;

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

4 subfactors’’ after ‘‘factors’’;

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

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

7 ‘‘(i) either a statement that the pro8 posals are intended to be evaluated with,

9 and award made after, discussions with the

10 offerors, or a statement that the proposals

11 are intended to be evaluated, and award

12 made, without discussions with the offerors

13 (other than discussions conducted for the

14 purpose of minor clarification) unless dis15 cussions are determined to be necessary;

16 and’’; and

17 (4) by adding at the end the following new sub18 section:

19 ‘‘(c)(1) In prescribing the evaluation factors to be in20 cluded in each solicitation for competitive proposals, an

21 agency head—

22 ‘‘(A) shall clearly establish the relative impor23 tance assigned to the evaluation factors and

24 subfactors, including the quality of the product or

25 services to be provided (including technical capabil-
36

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1 ity, management capability, and prior experience of

2 the offeror);

3 ‘‘(B) shall include cost or price to the Govern4 ment as an evaluation factor that must be consid5 ered in the evaluation of proposals; and

6 ‘‘(C) shall disclose to offerors whether all eval7 uation factors other than price or cost, when com8 bined, are—

9 ‘‘(i) significantly more important than

10 price or cost;

11 ‘‘(ii) approximately equal in importance to

12 price or cost; or

13 ‘‘(iii) significantly less important than

14 price or cost.

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

16 from—

17 ‘‘(A) providing additional information in a solic18 itation, including numeric weights for all evaluation

19 factors; or

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

21 made to the offeror that meets the solicitation’s

22 mandatory requirements at the lowest price or

23 cost.’’.
37

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

2 Federal Property and Administrative Services Act of 1949

3 (41 U.S.C. 253b) is amended—

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

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

6 (2) in subsection (c), by inserting ‘‘in accord7 ance with subsection (a)’’ in the second sentence

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

9 (3) in subsection (d)—

10 (A) by striking out paragraph (1) and in11 serting in lieu thereof the following:

12 ‘‘(1) An agency head shall evaluate competitive pro13 posals in accordance with subsection (a) and may award

14 a contract—

15 ‘‘(A) after discussions with the offerors, pro16 vided that written or oral discussions have been con17 ducted with all responsible offerors who submit pro18 posals within the competitive range; or

19 ‘‘(B) based on the proposals received and with20 out discussions with the offerors (other than discus21 sions conducted for the purpose of minor clarifica22 tion), provided that, as required by section

23 303A(b)(2)(B)(i), the solicitation included a state24 ment that proposals are intended to be evaluated,
38

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1 and award made, without discussions, unless discus2 sions are determined to be necessary.’’; and

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

4 and by redesignating paragraph (4) as para5 graph (2).

6 (c) APPLICABILITY.—

7 (1) IN GENERAL.—Except as provided in para8 graph (2), the amendments made by this section

9 shall apply to—

10 (A) solicitations for sealed bids or competi11 tive proposals issued after the end of the 180-

12 day period beginning on the date of the enact13 ment of this Act; and

14 (B) contracts awarded pursuant to those

15 solicitations.

16 (2) AUTHORITY TO APPLY AMENDMENTS

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

18 the amendments made by this section to solicitations

19 issued before the end of the period referred to in

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

21 shall publish in the Federal Register notice of any

22 such earlier date of application at least 10 days be23 fore that date.
39

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1 SEC. 1062. SOLICITATION PROVISION REGARDING EVALUA2 TION OF PURCHASE OPTIONS.

3 Section 303A of the Federal Property and Adminis4 trative Services Act of 1949 (41 U.S.C. 253a), as amend5 ed by section 1061(a)(4), is further amended by adding

6 at the end the following new subsection:

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

8 contract to be awarded using sealed bid procedures, may

9 not include in such solicitation a clause providing for the

10 evaluation of prices under the contract for options to pur11 chase additional supplies or services under the contract

12 unless the agency head has determined that there is a rea13 sonable likelihood that the options will be exercised.’’.

14 SEC. 1063. PROMPT NOTICE OF AWARD.

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

16 section 303B of the Federal Property and Administrative

17 Services Act of 1949 (41 U.S.C. 253b) is amended by add18 ing at the end the following: ‘‘Within 3 days after the date

19 of contract award, the agency head shall notify offerors

20 not awarded the contract that the contract has been

21 awarded.’’.

22 (b) COMPETITIVE PROPOSALS PROCEDURES.—Para23 graph (2) of section 303B(d) of the Federal Property and

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

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

26 the second sentence by striking out ‘‘shall promptly no-
40

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1 tify’’ and inserting in lieu thereof ‘‘, within 3 days after

2 the date of contract award, shall notify’’.

3 SEC. 1064. POST-AWARD DEBRIEFINGS.

4 Section 303B of the Federal Property and Adminis5 trative Services Act of 1949 (41 U.S.C. 253b) is amend6 ed—

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

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

9 (2) by inserting after subsection (d) the follow10 ing new subsection (e):

11 ‘‘(e)(1) When a contract is awarded by an executive

12 agency on the basis of competitive proposals, an unsuc13 cessful offeror, upon written request received by the execu14 tive agency within 7 days after the date of contract award,

15 shall be debriefed and furnished the basis for the selection

16 decision and contract award. An employee of the executive

17 agency shall debrief the offeror within 7 days after receipt

18 of the request by the executive agency.

19 ‘‘(2) The debriefing shall provide the offeror with—

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

21 significant weak or deficient factors in the offeror’s

22 offer;

23 ‘‘(B) the overall evaluated cost of the offer of

24 the contractor awarded the contract and the overall

25 evaluated cost of the offer of the debriefed offeror;
41

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1 ‘‘(C) the overall ranking of all offers and the

2 total technical and cost scores of all offers;

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

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

5 equipment that is a commercial item, the make and

6 model of the item incorporated in the offer of the

7 contractor awarded the contract; and

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

9 the debriefed offeror as to whether source selection

10 procedures set forth in the solicitation, applicable

11 regulations, and other applicable authorities were

12 followed by the executive agency.

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

14 comparisons of the debriefed offeror’s offer with other of15 fers and may not disclose any information that is exempt

16 from disclosure under section 552 of title 5, United States

17 Code, including information relating to—

18 ‘‘(A) trade secrets;

19 ‘‘(B) privileged or confidential manufacturing

20 processes and techniques; and

21 ‘‘(C) commercial and financial information that

22 is privileged or confidential, including cost break23 downs, profit, indirect cost rates, and similar infor24 mation.
42

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

2 include a statement that information described in para3 graph (2) may be disclosed in post-award debriefings.

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

5 award and as a result of a successful procurement protest

6 or otherwise, the executive agency seeks to fulfill the re7 quirement under the contract either on the basis of a new

8 solicitation of offers or on the basis of the best and final

9 offers considered in the awarding of that contract, the

10 agency head shall provide each such offeror with—

11 ‘‘(A) all information provided in debriefings

12 under this paragraph regarding the offer of the con13 tractor awarded the contract; and

14 ‘‘(B) all comparable information with respect to

15 the original offerors.

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

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

18 SEC. 1065. PROTEST FILE.

19 Section 303B of the Federal Property and Adminis20 trative Services Act of 1949 (41 U.S.C. 253b), as amend21 ed by section 1064(1), is further amended by adding at

22 the end the following:

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

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

25 by, an agency head, a protest is filed pursuant to the pro-
43

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1 cedures in subchapter V of chapter 35 of title 31, United

2 States Code, and an actual or prospective offeror so re3 quests, a file of the protest shall be established by the con4 tracting activity and reasonable access shall be provided

5 to actual or prospective offerors.

6 ‘‘(2) Information exempt from disclosure under sec7 tion 552 of title 5, United States Code, may be redacted

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

9 applicable protective order provides otherwise.

10 ‘‘(3) Regulations implementing this subsection shall

11 be consistent with the regulations regarding the prepara12 tion and submission of an agency’s protest file (the so13 called ‘rule 4 file’) for protests to the General Services

14 Board of Contract Appeals under the Contract Disputes

15 Act of 1978 (41 U.S.C. 601 et seq.).’’.

16 SEC. 1066. AWARD OF COSTS AND FEES IN AGENCY SETTLE17 MENT OF PROTESTS.

18 Section 303B of the Federal Property and Adminis19 trative Services Act of 1949 (41 U.S.C. 253b), as amend20 ed by section 1066, is further amended by adding at the

21 end the following new subsection:

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

23 determines that a solicitation, proposed award, or award

24 does not satisfy the requirements of law or regulation, the

25 agency head may take any action set out in subparagraphs
44

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1 (A) through (F) of section 3554(b)(1) of title 31, United

2 States Code.’’.

3 Subpart C—Kinds of Contracts

4 SEC. 1071. AGENCY HEAD DETERMINATION REGARDING

5 USE OF COST TYPE OR INCENTIVE CON6 TRACT.

7 Section 304(b) of the Federal Property and Adminis8 trative Services Act of 1949 (41 U.S.C. 254(b)) is amend9 ed by striking out the second sentence.

10 PART III—ACQUISITIONS GENERALLY

11 SEC. 1091. REPEAL OF REQUIREMENT FOR ANNUAL RE12 PORT ON COMPETITION.

13 Section 23 of the Office of Federal Procurement Pol14 icy Act (41 U.S.C. 419) is repealed.

15 Subtitle B—Truth in Negotiations

16 PART I—ARMED SERVICES ACQUISITIONS

17 SEC. 1201. STABILIZATION OF DOLLAR THRESHOLD OF AP18 PLICABILITY.

19 Section 2306a(a)(1)(A) of title 10, United States

20 Code, is amended—

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

22 January 1, 1996,’’; and

23 (2) in clause (ii), by striking out ‘‘or after De24 cember 31, 1995,’’.
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1 SEC. 1202. EXCEPTIONS TO COST OR PRICING DATA RE2 QUIREMENTS.

3 Section 2306a(b) of title 10, United States Code, is

4 amended to read as follows:

5 ‘‘(b) EXCEPTIONS.—(1) This section need not be ap6 plied to a contract or subcontract—

7 ‘‘(A) for which the price agreed upon is based

8 on—

9 ‘‘(i) adequate price competition;

10 ‘‘(ii) established catalog or market prices

11 of commercial items or of services regularly

12 used for other than Government purposes, as

13 the case may be, that are sold in substantial

14 quantities to the general public; or

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

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

17 the agency determines that the requirements of this

18 section may be waived and states in writing the rea19 sons for such determination.

20 ‘‘(2) This section need not be applied to a modifica21 tion of a contract or subcontract if—

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

23 is one to which this section need not be applied by

24 reason of clause (i) or (ii) of paragraph (1)(A); and

25 ‘‘(B) the modification would not change the

26 contract or subcontract, as the case may be, from a
46

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1 contract or subcontract for the acquisition of a com2 mercial item to a contract or subcontract for the ac3 quisition of a noncommercial item.’’.

4 SEC. 1203. LIMITATION ON AUTHORITY TO REQUIRE A SUB5 MISSION NOT OTHERWISE REQUIRED.

6 Section 2306a(c) of title 10, United States Code, is

7 amended by striking out ‘‘by subsection (a), such data

8 may nevertheless be required to be submitted by the head

9 of the agency if’’ and inserting in lieu thereof ‘‘by reason

10 of subsection (b), submission of such data may not be re11 quired unless’’.

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—

24 ‘‘(A) conduct procurements of commercial items

25 on a competitive basis; and
47

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1 ‘‘(B) exercise the authority provided in sub2 section (b)(1)(A) to exempt the contracts and sub3 contracts under such procurements from the require4 ments of subsection (a).

5 ‘‘(2) In any case in which it is not practicable to con6 duct a procurement of a commercial item on a competitive

7 basis and the procurement is not covered by an exception

8 in subsection (b), the contracting officer may nonetheless

9 exempt a contract or subcontract under the procurement

10 from the requirements of subsection (a) if—

11 ‘‘(A) in accordance with regulations implement12 ing this paragraph, the offeror, contractor, or sub13 contractor, as the case may be, provides the con14 tracting officer with information on the price

15 charged by such offeror, contractor, or subcontractor

16 for the same or similar products in the commercial

17 marketplace; and

18 ‘‘(B) the contracting officer determines in writ19 ing that the information provided is adequate for

20 evaluating the reasonableness of the price of the con21 tract or subcontract.

22 ‘‘(3)(A) The Government shall be entitled to a reduc23 tion in price and the return of any overpayment, with in24 terest, if an offeror, contractor, or subcontractor provides
48

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1 materially inaccurate or misleading information to the

2 contracting officer pursuant to paragraph (2).

3 ‘‘(B) Nothing in subparagraph (A) is intended to pre4 clude the head of an agency from negotiating any contract

5 clause that provides additional price adjustment authority

6 for the protection of the Government’s interest in specific

7 types of contracts, including multiple ordering agree8 ments.

9 ‘‘(4)(A) The head of an agency shall have the right

10 to examine all information provided by an offeror, contrac11 tor, or subcontractor pursuant to paragraph (2) and all

12 books and records of such offeror, contractor, or sub13 contractor that directly relate to such information in order

14 to determine whether such information is materially inac15 curate or misleading.

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

17 3 years after the date of award of the contract, or 3 years

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

19 respect to which the information was provided.’’.

20 SEC. 1205. RIGHT OF UNITED STATES TO EXAMINE CON21 TRACTOR RECORDS.

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

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

24 by section 1204(1), and inserting in lieu thereof the fol25 lowing:
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1 ‘‘(g) RIGHT OF UNITED STATES TO EXAMINE CON2 TRACTOR RECORDS.—For the purpose of evaluating the

3 accuracy, completeness, and currency of cost or pricing

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

5 of an agency shall have the rights provided by section

6 2313 of this title.’’.

7 SEC. 1206. REQUIRED REGULATIONS.

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

9 amended by sections 1204 and 1205, is further amended

10 by inserting after subsection (g) the following new sub11 section:

12 ‘‘(h) REQUIRED REGULATIONS.—(1) The Secretary

13 of Defense shall prescribe regulations identifying the type

14 of procurements for which contracting officers should con15 sider requiring the submission of certified cost or pricing

16 data under this section.

17 ‘‘(2) The Secretary also shall prescribe regulations

18 concerning the types of information that offerors must

19 submit for a contracting officer to consider in determining

20 whether the price of a procurement to the Government is

21 fair and reasonable when certified cost or pricing data are

22 not required to be submitted under this section because

23 the price of the procurement to the United States is not

24 expected to exceed $500,000. Such information, at a mini25 mum, shall include appropriate information on the prices
50

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1 at which such offeror has previously sold the same or simi2 lar products.’’.

3 SEC. 1207. CONSISTENCY OF TIME REFERENCES.

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

5 amended by section 1204, is further amended—

6 (1) in subparagraphs (A)(ii) and (B)(ii) of sub7 section (e)(4), by inserting ‘‘or, if applicable consist8 ent with paragraph (1)(B), another date agreed

9 upon between the parties’’ after ‘‘(or price of the

10 modification)’’; and

11 (2) in subsection (i), by inserting ‘‘or, if appli12 cable consistent with subsection (d)(1)(B), another

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

14 price of a contract modification)’’.

15 SEC. 1208. REPEAL OF SUPERSEDED PROVISION.

16 Subsection (c) of section 803 of Public Law 101–510

17 (10 U.S.C. 2306a note) is repealed.

18 PART II—CIVILIAN AGENCY ACQUISITIONS

19 SEC. 1251. REVISION OF CIVILIAN AGENCY PROVISIONS TO

20 ENSURE UNIFORM TREATMENT OF COST OR

21 PRICING DATA.

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

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

24 et seq.) is amended—
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1 (1) in section 304, by striking out subsection

2 (d); and

3 (2) by inserting after section 304 the following

4 new section:

5 ‘‘COST OR PRICING DATA: TRUTH IN NEGOTIATIONS

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

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

8 offerors, contractors, and subcontractors to make cost or

9 pricing data available as follows:

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

11 title to be entered into using procedures other than

12 sealed-bid procedures shall be required to submit

13 cost or pricing data before the award of a contract

14 if—

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

16 into after the date of the enactment of the Fed17 eral Acquisition Streamlining Act of 1993, the

18 price of the contract to the United States is ex19 pected to exceed $500,000; and

20 ‘‘(ii) in the case of a prime contract en21 tered into on or before the date of the enact22 ment of the Federal Acquisition Streamlining

23 Act of 1993, the price of the contract to the

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

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

26 this chapter shall be required to submit cost or pric-
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1 ing data before the pricing of a change or modifica2 tion to the contract if—

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

4 made to a prime contract referred to in sub5 paragraph (A)(i), the price adjustment is ex6 pected to exceed $500,000;

7 ‘‘(ii) in the case of a change or modifica8 tion made to a prime contract that was entered

9 into on or before the date of the enactment of

10 the Federal Acquisition Streamlining Act of

11 1993, and that has been modified pursuant to

12 paragraph (6), the price adjustment is expected

13 to exceed $500,000; and

14 ‘‘(iii) in the case of a change or modifica15 tion not covered by clause (i) or (ii), the price

16 adjustment is expected to exceed $100,000.

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

18 of a contract under this title shall be required to

19 submit cost or pricing data before the award of the

20 subcontract if the prime contractor and each higher21 tier subcontractor have been required to make avail22 able cost or pricing data under this section and—

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

24 prime contract referred to in subparagraph
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1 (A)(i), the price of the subcontract is expected

2 to exceed $500,000;

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

4 into under a prime contract that was entered

5 into on or before the date of the enactment of

6 the Federal Acquisition Streamlining Act of

7 1993, and that has been modified pursuant to

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

9 expected to exceed $500,000; and

10 ‘‘(iii) in the case of a subcontract not cov11 ered by clause (i) or (ii), the price of the sub12 contract is expected to exceed $100,000.

13 ‘‘(D) The subcontractor for a subcontract cov14 ered by subparagraph (C) shall be required to sub15 mit cost or pricing data before the pricing of a

16 change or modification to the subcontract if—

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

18 to a subcontract referred to in subparagraph

19 (C)(i) or (C)(ii), the price adjustment is ex20 pected to exceed $500,000; and

21 ‘‘(ii) in the case of a change or modifica22 tion to a subcontract referred to in subpara23 graph (C)(iii), the price adjustment is expected

24 to exceed $100,000.
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1 ‘‘(2) A person required, as an offeror, contractor, or

2 subcontractor, to submit cost or pricing data under para3 graph (1) (or required by the agency head concerned to

4 submit such data under subsection (c)) shall be required

5 to certify that, to the best of the person’s knowledge and

6 belief, the cost or pricing data submitted are accurate,

7 complete, and current.

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

9 under paragraph (1) (or under subsection (c)), and a cer10 tification required to be submitted under paragraph (2),

11 shall be submitted—

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

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

14 the contracting officer for the contract (or to a des15 ignated representative of the contracting officer); or

16 ‘‘(B) in the case of a submission by a sub17 contractor (or an offeror for a subcontract), to the

18 prime contractor.

19 ‘‘(4) Except as provided under subsection (b), this

20 section applies to contracts entered into by an agency head

21 on behalf of a foreign government.

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

23 or subcontractor granted a waiver under subsection (b)(2)

24 shall be considered as having been required to make avail25 able cost or pricing data under this section.
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1 ‘‘(6)(A) Upon the request of a contractor that was

2 required to submit cost or pricing data under paragraph

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

4 or before the date of the enactment of the Federal Acquisi5 tion Streamlining Act of 1993, the agency head that en6 tered into such contract shall modify the contract to re7 flect subparagraphs (B)(ii) and (C)(ii) of paragraph (1).

8 All such modifications shall be made without requiring

9 consideration.

10 ‘‘(B) An agency head is not required to modify a con11 tract under subparagraph (A) if that agency head deter12 mines that the submission of cost or pricing data with re13 spect to that contract should be required under subsection

14 (c).

15 ‘‘(b) EXCEPTIONS.—(1) This section need not be ap16 plied to a contract or subcontract—

17 ‘‘(A) for which the price agreed upon is based

18 on—

19 ‘‘(i) adequate price competition;

20 ‘‘(ii) established catalog or market prices

21 of commercial items or of services regularly

22 used for other than Government purposes, as

23 the case may be, that are sold in substantial

24 quantities to the general public; or

25 ‘‘(iii) prices set by law or regulation; or
56

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

2 head determines that the requirements of this sec3 tion may be waived and states in writing the reasons

4 for such determination.

5 ‘‘(2) This section need not be applied to a modifica6 tion of a contract or subcontract if—

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

8 is one to which this section need not be applied by

9 reason of clause (i) or (ii) of paragraph (1)(A); and

10 ‘‘(B) 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) AUTHORITY TO REQUIRE COST OR PRICING

16 DATA.—When cost or pricing data are not required to be

17 submitted by reason of subsection (b), submission of such

18 data may not be required unless the agency head deter19 mines that such data are necessary for the evaluation by

20 the agency of the reasonableness of the price of the con21 tract or subcontract. In any case in which the agency head

22 requires such data to be submitted under this subsection,

23 the agency head shall document in writing the reasons for

24 such requirement.
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1 ‘‘(d) ADDITIONAL EXCEPTION PROVISIONS REGARD2 ING COMMERCIAL ITEMS.—(1) To the maximum extent

3 practicable, an agency head shall—

4 ‘‘(A) conduct procurements of commercial items

5 on a competitive basis; and

6 ‘‘(B) exercise the authority provided in sub7 section (b)(1)(A) to exempt the contracts and sub8 contracts under such procurements from the require9 ments of subsection (a).

10 ‘‘(2) In any case in which it is not practicable to con11 duct a procurement of a commercial item on a competitive

12 basis and the procurement is not covered by an exception

13 in subsection (b), the contracting officer may nonetheless

14 exempt a contract or subcontract under the procurement

15 from the requirements of subsection (a) if—

16 ‘‘(A) in accordance with regulations implement17 ing this paragraph, the offeror, contractor, or sub18 contractor, as the case may be, provides the con19 tracting officer with information on the price

20 charged by such offeror, contractor, or subcontractor

21 for the same or similar products in the commercial

22 marketplace; and

23 ‘‘(B) the contracting officer determines in writ24 ing that the information provided is adequate for
58

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1 evaluating the reasonableness of the price of the con2 tract or subcontract.

3 ‘‘(3)(A) The Government shall be entitled to a reduc4 tion in price and the return of any overpayment, with in5 terest, if an offeror, contractor, or subcontractor provides

6 materially inaccurate or misleading information to the

7 contracting officer pursuant to paragraph (2).

8 ‘‘(B) Nothing in subparagraph (A) is intended to pre9 clude an agency head from negotiating any contract clause

10 that provides additional price adjustment authority for the

11 protection of the Government’s interest in specific types

12 of contracts, including multiple ordering agreements.

13 ‘‘(4)(A) An agency head shall have the right to exam14 ine all information provided by an offeror, contractor, or

15 subcontractor pursuant to paragraph (2) and all books

16 and records of such offeror, contractor, or subcontractor

17 that directly relate to such information in order to deter18 mine whether such information is materially inaccurate or

19 misleading.

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

21 3 years after the date of award of the contract, or 3 years

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

23 respect to which the information was provided.

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

25 PRICING DATA.—(1)(A) A prime contract (or change or
59

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1 modification to a prime contract) under which a certificate

2 under subsection (a)(2) is required shall contain a provi3 sion that the price of the contract to the United States,

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

5 significant amount by which it may be determined by the

6 agency head that such price was increased because the

7 contractor (or any subcontractor required to make avail8 able such a certificate) submitted defective cost or pricing

9 data.

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

11 or pricing data are cost or pricing data which, as of the

12 date of agreement on the price of the contract (or another

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

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

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

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

17 upon by the parties shall be as close to the date of agree18 ment on the price of the contract as is practicable.

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

20 adjustment under a contract provision required by para21 graph (1) whether, and to what extent, a contract price

22 was increased because the contractor (or a subcontractor)

23 submitted defective cost or pricing data, it shall be a de24 fense that the United States did not rely on the defective

25 data submitted by the contractor or subcontractor.
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1 ‘‘(3) It is not a defense to an adjustment of the price

2 of a contract under a contract provision required by para3 graph (1) that—

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

5 been modified even if accurate, complete, and cur6 rent cost or pricing data had been submitted by the

7 contractor or subcontractor because the contractor

8 or subcontractor—

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

10 services procured; or

11 ‘‘(ii) otherwise was in a superior bargain12 ing position with respect to the property or

13 services procured;

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

15 that the cost and pricing data in issue were defective

16 even though the contractor or subcontractor took no

17 affirmative action to bring the character of the data

18 to the attention of the contracting officer;

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

20 between the contractor and the United States about

21 the total cost of the contract and there was no

22 agreement about the cost of each item procured

23 under such contract; or

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

25 not submit a certification of cost and pricing data
61

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1 relating to the contract as required under subsection

2 (a)(2).

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

4 amount against the amount of a contract price adjustment

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

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

7 officer (or to a designated representative of the con8 tracting officer) that, to the best of the contractor’s

9 knowledge and belief, the contractor is entitled to

10 the offset; and

11 ‘‘(ii) the contractor proves that the cost or pric12 ing data were available before the date of agreement

13 on the price of the contract (or price of the modi14 fication), or, if applicable consistent with paragraph

15 (1)(B), another date agreed upon between the par16 ties, and that the data were not submitted as speci17 fied in subsection (a)(3) before such date.

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

19 amount otherwise authorized to be offset under subpara20 graph (A) if—

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

22 with respect to the cost or pricing data involved was

23 known to be false when signed; or

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

25 or pricing data referred to in subparagraph (A)(ii)
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1 been submitted to the United States before the date

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

3 of the modification) or, if applicable under para4 graph (1)(B), another date agreed upon between the

5 parties, the submission of such cost or pricing data

6 would not have resulted in an increase in that price

7 in the amount to be offset.

8 ‘‘(f) INTEREST AND PENALTIES FOR CERTAIN OVER9 PAYMENTS.—(1) If the United States makes an overpay10 ment to a contractor under a contract with an executive

11 agency subject to this section and the overpayment was

12 due to the submission by the contractor of defective cost

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

14 States—

15 ‘‘(A) for interest on the amount of such over16 payment, to be computed—

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

18 the overpayment was made to the contractor

19 and ending on the date the contractor repays

20 the amount of such overpayment to the United

21 States; and

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

23 Secretary of the Treasury under section 6621

24 of the Internal Revenue Code of 1986; and
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1 ‘‘(B) if the submission of such defective data

2 was a knowing submission, for an additional amount

3 equal to the amount of the overpayment.

4 ‘‘(2) Any liability under this subsection of a contrac5 tor that submits cost or pricing data but refuses to submit

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

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

8 refusal to submit such certification.

9 ‘‘(g) RIGHT OF UNITED STATES TO EXAMINE CON10 TRACTOR RECORDS.—For the purpose of evaluating the

11 accuracy, completeness, and currency of cost or pricing

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

13 of an agency shall have the rights provided by section

14 304B(a)(2).

15 ‘‘(h) REQUIRED REGULATIONS.—(1) The head of

16 each executive agency shall prescribe regulations identify17 ing the type of procurements for which contracting officers

18 of that executive agency should consider requiring the sub19 mission of certified cost or pricing data under this section.

20 ‘‘(2) The agency head also shall prescribe regulations

21 concerning the types of information that offerors must

22 submit for a contracting officer to consider in determining

23 whether the price of a procurement to the Government is

24 fair and reasonable when certified cost or pricing data are

25 not required to be submitted under this section because
64

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1 the price of the procurement to the United States is not

2 expected to exceed $500,000. Such information, at a mini3 mum, shall include appropriate information on the prices

4 at which such offeror has previously sold the same or simi5 lar products.

6 ‘‘(i) COST OR PRICING DATA DEFINED.—In this sec7 tion, the term ‘cost or pricing data’ means all facts that,

8 as of the date of agreement on the price of a contract

9 (or the price of a contract modification) or, if applicable

10 consistent with subsection (e)(1)(B), another date agreed

11 upon between the parties, a prudent buyer or seller would

12 reasonably expect to affect price negotiations significantly.

13 Such terms does not include information that is

14 judgmental, but does include the factual information from

15 which a judgment was derived.’’.

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

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

18 the item relating to section 2304 the following:

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

19 SEC. 1252. REPEAL OF OBSOLETE PROVISION.

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

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

22 is repealed.

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

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

25 the item relating to section 303E.
65

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1 Subtitle C—Research and

2 Development

3 SEC. 1301. DELEGATION OF CONTRACTING AUTHORITY.

4 Section 2356 of title 10, United States Code, is

5 amended to read as follows:

6 ‘‘§ 2356. Contracts: delegations

7 ‘‘(a) AUTHORITY.—The Secretary of a military de8 partment may delegate any authority under section 1584,

9 2353, or 2354 of this title to—

10 ‘‘(1) the Under Secretary of his department;

11 ‘‘(2) an Assistant Secretary of his department;

12 ‘‘(3) a Deputy Assistant Secretary of his de13 partment; or

14 ‘‘(4) except as provided in subsection (b), the

15 chief, and one assistant to the chief, of any technical

16 service, bureau, or office.

17 ‘‘(b) LIMITATION.—The authority of the Secretary of

18 a military department under section 2353(b)(3) of this

19 title may not be delegated to a person described in sub20 section (a)(4).’’.

21 SEC. 1302. RESEARCH PROJECTS.

22 (a) AUTHORITY TO CONDUCT BASIC, ADVANCED,

23 AND APPLIED RESEARCH.—Section 2358 of title 10,

24 United States Code, is amended to read as follows:
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1 ‘‘§ 2358. Research projects

2 ‘‘(a) AUTHORITY.—The Secretary of Defense or the

3 Secretary of a military department may engage in basic,

4 advanced, and applied research and development projects

5 that—

6 ‘‘(1) are necessary to the responsibilities of

7 such Secretary’s department in the field of basic, ad8 vanced, and applied research and development; and

9 ‘‘(2) either—

10 ‘‘(A) relate to weapons systems and other

11 military needs; or

12 ‘‘(B) are of potential interest to such de13 partment.

14 ‘‘(b) AUTHORIZED MEANS.—The Secretary of De15 fense or the Secretary of a military department may per16 form research and development projects—

17 ‘‘(1) by contract, cooperative agreement, or

18 other transaction with, or by grant to, educational or

19 research institutions, private businesses, or other

20 agencies of the United States;

21 ‘‘(2) by using employees and consultants of the

22 Department of Defense; or

23 ‘‘(3) through one or more of the military de24 partments.

25 ‘‘(c) REQUIREMENT OF POTENTIAL MILITARY IN26 TEREST.—Funds appropriated to the Department of De-
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1 fense or to a military department may not be used to fi2 nance any research project or study unless the project or

3 study is, in the opinion of the Secretary of Defense or the

4 Secretary of that military department, respectively, of po5 tential interest to the Department of Defense or to such

6 military department, respectively.’’.

7 (b) AUTHORITY RELATED TO ADVANCED RESEARCH

8 PROJECTS.—

9 (1) REPEAL OF REDUNDANT AUTHORITY.—Sec10 tion 2371 of such title is amended—

11 (A) by striking out subsection (a);

12 (B) by redesignating subsections (b), (c),

13 (d), (e), (f), and (g) as subsections (a), (b), (c),

14 (d), (e), and (f), respectively;

15 (C) in subsection (a), as so redesignated—

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

17 ‘‘subsection (a)’’ and inserting in lieu

18 thereof ‘‘section 2358 of this title’’; and

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

20 ‘‘subsection (e)’’ and inserting in lieu

21 thereof ‘‘subsection (d)’’; and

22 (D) in subsection (e), as redesignated by

23 subparagraph (B)—
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1 (i) in paragraph (4), by striking out

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

3 thereof ‘‘subsection (a)’’; and

4 (ii) in paragraph (5), by striking out

5 ‘‘subsection (e)’’ and inserting in lieu

6 thereof ‘‘subsection (d)’’.

7 (2) CONSISTENCY OF TERMINOLOGY.—Such

8 section, as amended by paragraph (1), is further

9 amended—

10 (A) in subsection (c)(1), by inserting ‘‘and

11 development’’ after ‘‘research’’ both places it

12 appears;

13 (B) in subsections (d) and (e)(3), by strik14 ing out ‘‘advanced research’’ and inserting in

15 lieu thereof ‘‘research and development’’; and

16 (C) in subsection (e)(1), by striking out

17 ‘‘advanced research is’’ and inserting in lieu

18 thereof ‘‘research and development are’’.

19 (c) REDUNDANT AND OBSOLETE AUTHORITY FOR

20 THE ARMY.—

21 (1) REPEAL.—Section 4503 of title 10, United

22 States Code, is repealed.

23 (2) CLERICAL AMENDMENT.—The table of sec24 tions at the beginning of chapter 431 of such title
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1 is amended by striking out the item relating to sec2 tion 4503.

3 (d) REDUNDANT AND OBSOLETE AUTHORITY FOR

4 THE AIR FORCE.—

5 (1) REPEAL.—Section 9503 of title 10, United

6 States Code, is repealed.

7 (2) CLERICAL AMENDMENT.—The table of sec8 tions at the beginning of chapter 931 of such title

9 is amended by striking out the item relating to sec10 tion 9503.

11 SEC. 1303. ELIMINATION OF INFLEXIBLE TERMINOLOGY

12 REGARDING COORDINATION AND COMMU13 NICATION OF DEFENSE RESEARCH ACTIVI14 TIES.

15 Section 2364 of title 10, United States Code, is

16 amended—

17 (1) in subsection (b)(5), by striking out ‘‘mile18 stone 0, milestone I, and milestone II decisions’’ and

19 inserting in lieu thereof ‘‘acquisition program deci20 sions’’; and

21 (2) in subsection (c), by striking out para22 graphs (2), (3), and (4) and inserting in lieu thereof

23 the following:

24 ‘‘(2) The term ‘acquisition program decisions’

25 has the meaning given such term in regulations pre-
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1 scribed by the Secretary of Defense for the purposes

2 of this section.’’.

3 Subtitle D—Procurement Protests

4 PART I—PROTESTS TO THE COMPTROLLER

5 GENERAL

6 SEC. 1401. REVIEW OF PROTESTS AND EFFECT ON CON7 TRACTS PENDING DECISION.

8 (a) PERIODS FOR CERTAIN ACTIONS.—Section 3553

9 of title 31, United States Code, is amended—

10 (1) in subsection (b)—

11 (A) in paragraph (1), by striking out ‘‘one

12 working day of’’ and inserting in lieu thereof

13 ‘‘one day after’’; and

14 (B) in paragraph (2)—

15 (i) in subparagraph (A), by striking

16 out ‘‘25 working days from’’ and inserting

17 in lieu thereof ‘‘25 days after’’; and

18 (ii) in subparagraph (C), by striking

19 out ‘‘10 working days from’’ and inserting

20 in lieu thereof ‘‘25 days after’’; and

21 (2) in subsection (c)(3), by striking out ‘‘there22 after’’ and inserting in lieu thereof ‘‘after the mak23 ing of such finding’’.

24 (b) REFERENCE TO HEAD OF CONTRACTING ACTIV25 ITY.—Subsections (c)(2) and (e) of such section are
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1 amended by striking out ‘‘head of the procuring activity’’

2 and inserting in lieu thereof ‘‘head of the contracting ac3 tivity’’.

4 (c) SUSPENSION OF PERFORMANCE.—Subsection (d)

5 of such section is amended to read as follows:

6 ‘‘(d)(1) A contractor awarded a Federal agency con7 tract may, during the period described in paragraph (5),

8 begin performance of the contract and engage in any relat9 ed activities that result in obligations being incurred by

10 the United States under the contract upon receipt from

11 the contracting officer responsible for the award of the

12 contract of an authorization to proceed with performance

13 of the contract.

14 ‘‘(2) The contracting officer may withhold an author15 ization to proceed with performance of the contract during

16 the period described in paragraph (5) if the contracting

17 officer determines in writing that—

18 ‘‘(A) a protest is likely to be filed; and

19 ‘‘(B) the immediate performance of the contract

20 is not in the best interests of the United States.

21 ‘‘(3) Unless the contracting officer makes the deter22 minations described in paragraph (2), performance of the

23 contract may be authorized in the written notice of award

24 transmitted to the contractor pursuant to paragraph (3)

25 or (4)(B) of section 2305(b) of title 10 or subsection (c)
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1 or (d)(2) of section 303B of the Federal Property and Ad2 ministrative Services Act of 1949 (41 U.S.C. 253b), as

3 the case may be.

4 ‘‘(4)(A) If the Federal agency awarding the contract

5 receives notice of a protest in accordance with this section

6 during the period described in paragraph (5)—

7 ‘‘(i) the contracting officer may not authorize

8 performance of the contract to begin while the pro9 test is pending; or

10 ‘‘(ii) if contract performance was authorized in

11 accordance with paragraph (2) before receipt of the

12 notice, the contracting officer shall immediately di13 rect the contractor to cease performance under the

14 contract and to suspend any related activities that

15 may result in additional obligations being incurred

16 by the United States under that contract.

17 ‘‘(B) Performance and related activities suspended

18 pursuant to subparagraph (A)(ii) by reason of a protest

19 may not be resumed while the protest is pending.

20 ‘‘(C) The head of the contracting activity may au21 thorize the performance of the contract (notwithstanding

22 a protest of which the Federal agency has notice under

23 this section)—

24 ‘‘(i) upon a written finding that—
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1 ‘‘(I) performance of the contract is in the

2 best interests of the United States; or

3 ‘‘(II) urgent and compelling circumstances

4 that significantly affect interests of the United

5 States will not permit waiting for the decision

6 of the Comptroller General concerning the pro7 test; and

8 ‘‘(ii) after the Comptroller General is notified of

9 that finding.

10 ‘‘(5) The period referred to in paragraphs (2) and

11 (4)(A), with respect to a contract, is the period beginning

12 on the date of the contract award and ending on the later

13 of—

14 ‘‘(A) the date that is 10 days after the date of

15 the contract award; or

16 ‘‘(B) the date that is 7 days after the debriefing

17 date offered to an unsuccessful offeror for any de18 briefing that is requested and, when requested, is re19 quired.’’.

20 SEC. 1402. DECISIONS ON PROTESTS.

21 (a) PERIODS FOR CERTAIN ACTIONS.—Section

22 3554(a) of title 31, United States Code, is amended—

23 (1) in paragraph (1), by striking out ‘‘90 work24 ing days from’’ and inserting in lieu thereof ‘‘125

25 days after’’;
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1 (2) in paragraph (2), by striking out ‘‘45 cal2 endar days from’’ and inserting ‘‘65 days after’’;

3 (3) by redesignating paragraph (3) as para4 graph (4); and

5 (4) by inserting after paragraph (2) the follow6 ing new paragraph (3):

7 ‘‘(3) An amendment that adds a new ground of pro8 test should be resolved, to the maximum extent prac9 ticable, within the time limit established under paragraph

10 (1) of this subsection for final decision of the initial pro11 test. If an amended protest cannot be resolved within such

12 time limit, the Comptroller General may resolve the

13 amended protest through the express option under para14 graph (2) of this subsection.’’.

15 (b) GAO RECOMMENDATIONS ON PROTESTS.—

16 (1) IMPLEMENTATION OF RECOMMENDA17 TIONS.—Section 3554 of title 31, United States

18 Code, is amended—

19 (A) in subsection (b), by adding at the end

20 the following new paragraph:

21 ‘‘(3) If the Federal agency fails to implement fully

22 the recommendations of the Comptroller General under

23 this subsection with respect to a solicitation for a contract

24 or an award or proposed award of a contract within 60

25 days after receiving the recommendations, the head of the
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1 contracting activity responsible for that contract shall re2 port such failure to the Comptroller General not later than

3 5 working days after the end of such 60-day period.’’;

4 (B) by striking out subsection (c) and in5 serting in lieu thereof the following:

6 ‘‘(c)(1) If the Comptroller General determines that

7 a solicitation for a contract or a proposed award or the

8 award of a contract does not comply with a statute or reg9 ulation, the Comptroller General may recommend that the

10 Federal agency conducting the procurement pay to an ap11 propriate interested party the costs of—

12 ‘‘(A) filing and pursuing the protest, including

13 reasonable attorney’s fees and consultant and expert

14 witness fees; and

15 ‘‘(B) bid and proposal preparation.

16 ‘‘(2) No party may be paid, pursuant to a rec17 ommendation made under the authority of paragraph

18 (1)—

19 ‘‘(A) costs for consultant and expert witness

20 fees that exceed the rates provided under section

21 504(b)(1)(A) of title 5 for expert witnesses; or

22 ‘‘(B) costs for attorney’s fees that exceed the

23 rates provided for attorneys under section

24 504(b)(1)(A) of title 5.
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1 ‘‘(3) If the Comptroller General recommends under

2 paragraph (1) that a Federal agency pay costs to an inter3 ested party, the Federal agency shall—

4 ‘‘(A) pay the costs promptly out of funds appro5 priated by section 1304 of this title for the payment

6 of judgments and reimburse that appropriation ac7 count out of available funds or out of additional

8 funds appropriated for such Federal agency to make

9 such reimbursement; or

10 ‘‘(B) if the Federal agency does not make such

11 payment, promptly report to the Comptroller Gen12 eral the reasons for the failure to follow the Comp13 troller General’s recommendation.

14 ‘‘(4) If the Comptroller General recommends under

15 paragraph (1) that a Federal agency pay costs to an inter16 ested party, the Federal agency and the interested party

17 shall attempt to reach an agreement on the amount of the

18 costs to be paid. If the Federal agency and the interested

19 party are unable to agree on the amount to be paid, the

20 Comptroller General may, upon the request of the inter21 ested party, recommend to the Federal agency the amount

22 of the costs that the Federal agency should pay.’’; and

23 (C) by striking out subsection (e) and in24 serting in lieu thereof the following:
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1 ‘‘(e)(1) The Comptroller General shall report prompt2 ly to the Committee on Governmental Affairs and the

3 Committee on Appropriations of the Senate and to the

4 Committee on Government Operations and the Committee

5 on Appropriations of the House of Representatives any

6 case in which a Federal agency fails to implement fully

7 a recommendation of the Comptroller General under sub8 section (b) or (c). The report shall include—

9 ‘‘(A) a comprehensive review of the pertinent

10 procurement, including the circumstances of the fail11 ure of the Federal agency to implement a rec12 ommendation of the Comptroller General; and

13 ‘‘(B) a recommendation regarding whether, in

14 order to correct an inequity or to preserve the integ15 rity of the procurement process, the Congress should

16 consider—

17 ‘‘(i) private relief legislation;

18 ‘‘(ii) legislative rescission or cancellation of

19 funds;

20 ‘‘(iii) further investigation by the Congress;

21 or

22 ‘‘(iv) other action.

23 ‘‘(2) Not later than January 31 of each year, the

24 Comptroller General shall transmit to the Congress a re25 port containing a summary of each instance in which a
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1 Federal agency did not fully implement a recommendation

2 of the Comptroller General under subsection (b) or (c)

3 during the preceding year. The report shall also describe

4 each instance in which a final decision in a protest was

5 not rendered within 125 days after the date the protest

6 is submitted to the Comptroller General.’’.

7 (2) REQUIREMENT FOR PAYMENT IN ACCORD8 ANCE WITH PRIOR GAO DETERMINATIONS.—

9 Amounts to which the Comptroller General declared

10 an interested party to be entitled under section 3554

11 of title 31, United States Code, as in effect imme12 diately before the enactment of this Act, shall, if not

13 paid or otherwise satisfied by the Federal agency

14 concerned before the date of the enactment of this

15 Act, be paid promptly from the appropriation made

16 by section 1304 of such title for the payment of

17 judgments. The Federal agency shall reimburse that

18 appropriation account out of available funds or out

19 of additional funds appropriated for such Federal

20 agency to make such reimbursement. If the Federal

21 agency is unable to make the reimbursement out of

22 available funds, the head of such agency shall imme23 diately take such action as may be necessary to

24 transmit to Congress a request for an appropriation

25 of additional funds to make such reimbursement.
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1 (c) REFERENCE TO HEAD OF CONTRACTING ACTIV2 ITY.—Subsections (b)(2) and (d) of section 3554 of title

3 31, United States Code, are amended by striking out

4 ‘‘head of the procuring activity’’ and inserting in lieu

5 thereof ‘‘head of the contracting activity’’.

6 SEC. 1403. REGULATIONS.

7 (a) COMPUTATION OF PERIODS.—Section 3555 of

8 title 31, United States Code, is amended—

9 (1) by redesignating subsection (b) as sub10 section (d); and

11 (2) by inserting after subsection (a) the follow12 ing new subsection (b):

13 ‘‘(b) The procedures shall provide that, in the com14 putation of any period described in this subchapter—

15 ‘‘(1) the day of the act, event, or default from

16 which the designated period of time begins to run

17 not be included; and

18 ‘‘(2) the last day after such act, event, or de19 fault be included, unless—

20 ‘‘(A) such last day is a Saturday, a Sun21 day, or a legal holiday; or

22 ‘‘(B) in the case of a filing of a paper at

23 the General Accounting Office or a Federal

24 agency, such last day is a day on which weather

25 or other conditions make the General Account-
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1 ing Office or Federal agency inaccessible, in

2 which event the next day that is not a Satur3 day, Sunday, or legal holiday shall be in4 cluded.’’.

5 (b) ELECTRONIC FILINGS AND DISSEMINATIONS.—

6 Such section, as amended by subsection (a), is further

7 amended by inserting after subsection (b) the following

8 new subsection:

9 ‘‘(c) The Comptroller General may prescribe proce10 dures for the electronic filing and dissemination of docu11 ments and information required under this subchapter. In

12 prescribing such procedures, the Comptroller General shall

13 consider the ability of all parties to achieve electronic ac14 cess to such documents and records.’’.

15 (c) REPEAL OF OBSOLETE DEADLINE.—Subsection

16 (a) of such section is amended by striking out ‘‘Not later

17 than January 15, 1985, the’’ and inserting in lieu thereof

18 ‘‘The’’.

19 PART II—PROTESTS IN THE FEDERAL COURTS

20 SEC. 1421. NONEXCLUSIVITY OF REMEDIES.

21 Section 3556 of title 31, United States Code, is

22 amended by striking out ‘‘a district court of the United

23 States or the United States Claims Court’’ in the first sen24 tence and inserting in lieu thereof ‘‘the United States

25 Court of Federal Claims’’.
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1 SEC. 1422. JURISDICTION OF THE UNITED STATES COURT

2 OF FEDERAL CLAIMS.

3 (a) CLAIMS AGAINST THE UNITED STATES AND BID

4 PROTESTS.—Section 1491 of title 28, United States Code,

5 is amended—

6 (1) by redesignating subsection (b) as sub7 section (d);

8 (2) in subsection (a)—

9 (A) by striking out ‘‘(a)(1)’’ and inserting

10 in lieu thereof ‘‘(a) CLAIMS AGAINST THE

11 UNITED STATES.—’’;

12 (B) in paragraph (2), by striking out ‘‘(2)

13 To’’ and inserting in lieu thereof ‘‘(b) REMEDY

14 AND RELIEF.—To’’; and

15 (C) by striking out paragraph (3); and

16 (3) by inserting after subsection (b), as des17 ignated by paragraph (2)(B), the following new sub18 section (c):

19 ‘‘(c) BID PROTESTS.—(1) The United States Court

20 of Federal Claims has exclusive jurisdiction to render

21 judgment on an action by an interested party objecting

22 to a solicitation by a Federal agency for bids or proposals

23 for a proposed contract or to a proposed award or the

24 award of a contract. The court has jurisdiction to enter25 tain such an action without regard to whether suit is insti26 tuted before or after the contract is awarded.
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1 ‘‘(2) To afford relief in such an action, the court may

2 award any relief that the court considers proper, including

3 declaratory and injunctive relief.

4 ‘‘(3) In exercising jurisdiction under this subsection,

5 the court shall give due regard to the interests of national

6 defense and national security and the need for expeditious

7 resolution of the action.

8 ‘‘(4) The district courts of the United States do not

9 have jurisdiction of any action referred to in paragraph

10 (1).’’.

11 (b) CLERICAL AMENDMENTS.—

12 (1) SECTION HEADING.—The heading of such

13 section is amended by inserting ‘‘BID PROTESTS;’’

14 after ‘‘GENERALLY;’’.

15 (2) TABLE OF SECTIONS.—The table of sections

16 at the beginning of chapter 91 of title 28, United

17 States Code, is amended by striking out the item re18 lating to section 1491 and inserting in lieu thereof

19 the following:

‘‘1491. Claims against United States generally; bid protests; actions involving

Tennessee Valley Authority.’’.
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1 PART III—PROTESTS IN PROCUREMENTS OF

2 AUTOMATIC DATA PROCESSING

3 SEC. 1431. REVOCATION OF DELEGATIONS OF PROCURE4 MENT AUTHORITY.

5 Section 111(b)(3) of the Federal Property and Ad6 ministrative Services Act of 1949 (40 U.S.C. 759(b)(3))

7 is amended by inserting after the third sentence the fol8 lowing: ‘‘The Administrator may revoke a delegation of

9 authority with respect to a particular contract before or

10 after award of the contract, except that the Administrator

11 may revoke a delegation after the contract is awarded only

12 when there is a finding of a violation of law or regulation

13 in connection with the contract award.’’.

14 SEC. 1432. AUTHORITY OF THE GENERAL SERVICES ADMIN15 ISTRATION BOARD OF CONTRACT APPEALS.

16 The first sentence of section 111(f)(1) of the Federal

17 Property and Administrative Services Act of 1949 (40

18 U.S.C. 759(f)(1)) is amended to read as follows: ‘‘Upon

19 request of an interested party in connection with any pro20 curement that is subject to this section (including any

21 such procurement that is subject to delegation of procure22 ment authority), the board of contract appeals of the Gen23 eral Services Administration (hereafter in this subsection

24 referred to as the ‘board’) shall review, as provided in this

25 subsection, any decision by a Federal agency that is al-
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1 leged to violate a statute, a regulation, or the conditions

2 of a delegation of procurement authority.’’.

3 SEC. 1433. PERIODS FOR CERTAIN ACTIONS.

4 (a) SUSPENSION OF PROCUREMENT AUTHORITY.—

5 Section 111(f) of the Federal Property and Administrative

6 Services Act of 1949 (40 U.S.C. 759(f)) is amended in

7 paragraph (3) by striking out subparagraph (A) and in8 serting in lieu thereof the following:

9 ‘‘(A)(i) If, with respect to an award of a contract,

10 the board receives notice of a protest under this subsection

11 within the period described in clause (ii), the board shall,

12 at the request of an interested party, hold a hearing to

13 determine whether the board should suspend the procure14 ment authority of the Administrator or the Administra15 tor’s delegation of procurement authority for the protested

16 procurement on an interim basis until the board can de17 cide the protest.

18 ‘‘(ii) The period referred to in clause (i) is the period

19 beginning on the date on which the contract is awarded

20 and ending at the end of the later of—

21 ‘‘(I) the tenth day after the date of contract

22 award; or

23 ‘‘(II) the seventh day after the debriefing date

24 offered to an unsuccessful offeror for any debriefing

25 that is requested and, when requested, is required.
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1 ‘‘(iii) The board shall hold the requested hearing

2 within 7 days after the date of the filing of the protest

3 or, in the case of a request for debriefing under the provi4 sions of section 2305(b)(5) of title 10, United States Code,

5 or section 303B(e) of this Act, within 7 days after the

6 later of the date of the filing of the protest or the date

7 of the debriefing.’’.

8 (b) FINAL DECISION.—Paragraph (4)(B) of such sec9 tion 111(f) is amended—

10 (1) by striking out ‘‘45 working days’’ and in11 serting in lieu thereof ‘‘65 days’’; and

12 (2) by adding at the end the following: ‘‘An

13 amendment which adds a new ground of protest

14 should be resolved, to the maximum extent prac15 ticable, within the time limits established for resolu16 tion of the initial protest.’’.

17 SEC. 1434. DISMISSALS OF PROTESTS.

18 Section 111(f)(4) of the Federal Property and Ad19 ministrative Services Act of 1949 (40 U.S.C. 759(f)(4))

20 is amended by striking out subparagraph (C) and insert21 ing in lieu thereof the following:

22 ‘‘(C) The board may dismiss a protest that the board

23 determines—

24 ‘‘(i) is frivolous;

25 ‘‘(ii) has been brought in bad faith; or
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1 ‘‘(iii) does not state on its face a valid basis for

2 protest.’’.

3 SEC. 1435. AWARD OF COSTS.

4 Section 111(f)(5) is amended by striking out sub5 paragraph (C) and inserting in lieu thereof the following:

6 ‘‘(C) Whenever the board makes such a determina7 tion, it may, in accordance with section 1304 of title 31,

8 United States Code, further declare an appropriate pre9 vailing party to be entitled to the cost of filing and pursu10 ing the protest (including reasonable attorney’s fees and

11 consultant and expert witness fees), and bid and proposal

12 preparation. However, no party may be declared entitled

13 to costs for consultant and expert witness fees that exceed

14 the rates provided under section 504(b)(1)(A) of title 5,

15 United States Code, for expert witnesses or to costs for

16 attorney’s fees that exceed the rates provided for attorneys

17 under section 504(b)(1)(A) of title 5, United States

18 Code.’’.

19 SEC. 1436. DISMISSAL AGREEMENTS.

20 Section 111(f)(5) of the Federal Property and Ad21 ministrative Services Act of 1949 (40 U.S.C. 759(f)(5))

22 is amended by adding at the end the following new sub23 paragraphs:

24 ‘‘(D) Any agreement that provides for the dismissal

25 of a protest and involves a direct or indirect expenditure
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1 of appropriated funds shall be submitted to the board and

2 shall be made a part of the public record (subject to any

3 protective order considered appropriate by the board) be4 fore dismissal of the protest. If a Federal agency is a party

5 to a settlement agreement, the submission of the agree6 ment submitted to the board shall include a memorandum,

7 signed by the contracting officer concerned, that describes

8 in detail the procurement, the grounds for protest, the

9 Federal Government’s position regarding the grounds for

10 protest, the terms of the settlement, and the agency’s posi11 tion regarding the propriety of the award or proposed

12 award of the contract at issue in the protest.

13 ‘‘(E) Payment of amounts due from an agency under

14 subparagraph (C) or under the terms of a settlement

15 agreement under subparagraph (D) shall be made from

16 the appropriation made by section 1304 of title 31, United

17 States Code, for the payment of judgments. The Federal

18 agency concerned shall reimburse that appropriation ac19 count out of funds available for the procurement.’’.

20 SEC. 1437. JURISDICTION OF DISTRICT COURTS.

21 Section 111(f)(6)(C) of the Federal Property and Ad22 ministrative Services Act of 1949 (40 U.S.C.

23 759(f)(6)(C)) is amended by striking out ‘‘a district court

24 of the United States or the United States Claims Court’’
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1 in the third sentence and inserting in lieu thereof ‘‘the

2 United States Court of Federal Claims’’.

3 SEC. 1438. MATTERS TO BE COVERED IN REGULATIONS.

4 Section 111(f) of the Federal Property and Adminis5 trative Services Act of 1949 (40 U.S.C. 759(f)) is amend6 ed by striking out paragraph (8) and inserting in lieu

7 thereof the following:

8 ‘‘(7)(A) The board shall adopt and issue such rules

9 and procedures as may be necessary to the expeditious dis10 position of protests filed under the authority of this sub11 section.

12 ‘‘(B) The procedures shall provide that, in the com13 putation of any period described in this subsection—

14 ‘‘(i) the day of the act, event, or default from

15 which the designated period of time begins to run

16 not be included; and

17 ‘‘(ii) the last day after such act, event, or de18 fault be included, unless—

19 ‘‘(I) such last day is a Saturday, a Sunday,

20 or a legal holiday; or

21 ‘‘(II) in the case of a filing of a paper at

22 the board, such last day is a day on which

23 weather or other conditions make the board or

24 Federal agency inaccessible, in which event the
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1 next day that is not a Saturday, Sunday, or

2 legal holiday shall be included.

3 ‘‘(C) The procedures may provide for electronic filing

4 and dissemination of documents and information required

5 under this subsection and in so providing shall consider

6 the ability of all parties to achieve electronic access to such

7 documents and records.

8 ‘‘(D) The procedures shall provide that if the board

9 expressly finds that a protest or a portion of a protest

10 is frivolous or has not been brought or pursued in good

11 faith, or that any person has willfully abused the board’s

12 process during the course of a protest, the board may im13 pose appropriate sanctions. Such sanctions may include

14 the dismissal of the protest and an award to any other

15 party of costs (including reasonable attorneys’ fees not to

16 exceed the rates provided for pursuant to paragraph

17 (5)(C)) incurred as a result of such protest or conduct.’’.

18 SEC. 1439. DEFINITIONS.

19 (a) PROTEST.—Section 111(f)(9)(A) of the Federal

20 Property and Administrative Services Act of 1949 (40

21 U.S.C. 759(f)(9)(A)) is amended to read as follows:

22 ‘‘(A) the term ‘protest’ means a written objec23 tion by an 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 that termination or

10 cancellation is alleged to be based in whole or

11 in part on improprieties concerning the award

12 of the contract;’’.

13 (b) PREVAILING PARTY.—Section 111(f)(9) of such

14 Act is amended by adding at the end the following new

15 subparagraph:

16 ‘‘(C) the term ‘prevailing party’, with respect to

17 a determination of the board under paragraph

18 (5)(B) that a challenged action of a Federal agency

19 violates a statute or regulation or the conditions of

20 a delegation of procurement authority issued pursu21 ant to this section, means a party that demonstrated

22 such violation.’’.
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1 SEC. 1440. OVERSIGHT OF ACQUISITION OF AUTOMATIC

2 DATA PROCESSING EQUIPMENT BY FEDERAL

3 AGENCIES.

4 Section 111 of the Federal Property and Administra5 tive Services Act of 1949 (40 U.S.C. 759) is amended by

6 adding at the end the following new subsection:

7 ‘‘(h)(1) The Administrator shall collect and compile

8 data regarding the procurement of automatic data proc9 essing equipment under this section. The data collected

10 and compiled shall include, at a minimum, with regard to

11 each procurement the following:

12 ‘‘(A) The procuring agency.

13 ‘‘(B) The contractor.

14 ‘‘(C) The automatic data processing equipment

15 and services procured.

16 ‘‘(D) The manufacturer of the equipment pro17 cured.

18 ‘‘(E) The amount of the contract, to the extent

19 that the amount is not proprietary information.

20 ‘‘(F) The type of contract used.

21 ‘‘(G) The extent of competition for award.

22 ‘‘(H) Compatibility restrictions.

23 ‘‘(I) Significant modifications of the contract.

24 ‘‘(J) Contract price, to the extent that the price

25 is not proprietary information.
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1 ‘‘(2) The head of each Federal agency shall report

2 to the Administrator in accordance with regulations issued

3 by the Administrator all information that the Adminis4 trator determines necessary in order to satisfy the require5 ments in paragraph (1).

6 ‘‘(3) The Administrator shall—

7 ‘‘(A) carry out a systematic, periodic review of

8 information received under this subsection;

9 ‘‘(B) use such information, as appropriate, to

10 determine the compliance of Federal agencies with

11 the requirements of this section; and

12 ‘‘(C) have the authority to suspend the delega13 tion to a Federal agency of authority to lease or pur14 chase automatic data processing equipment upon

15 any failure by the head of the Federal agency to re16 port to the Administrator in accordance with para17 graph (2).’’.

18 Subtitle E—Definitions and Other

19 Matters

20 PART I—ARMED SERVICES ACQUISITIONS

21 SEC. 1501. DEFINITIONS.

22 Section 2302 of title 10, United States Code, is

23 amended—

24 (1) by striking out paragraphs (3), (4), (5), and

25 (7);
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1 (2) by redesignating paragraph (6) as para2 graph (5); and

3 (3) by inserting after paragraph (2) the follow4 ing:

5 ‘‘(3) The terms ‘commercial item’, ‘full and

6 open competition’, ‘major system’,

7 ‘nondevelopmental item’, ‘procurement’, ‘procure8 ment system’, ‘responsible source’, ‘standards’, and

9 ‘technical data’, have the meanings given such terms

10 in section 4 of the Office of Federal Procurement

11 Policy Act (41 U.S.C. 403).

12 ‘‘(4) The term ‘simplified acquisition threshold’

13 has the meaning given that term in section 4 of the

14 Office of Federal Procurement Policy Act (41 U.S.C.

15 403), except that, in the case of any contract to be

16 awarded and performed, or purchase to be made,

17 outside the United States in support of a contin18 gency operation, the term means an amount equal to

19 two times the amount specified for that term in sec20 tion 4 of such Act.’’.

21 SEC. 1502. DELEGATION OF PROCUREMENT FUNCTIONS.

22 (a) CONSOLIDATION OF DELEGATION AUTHORITY.—

23 Section 2311 of title 10, United States Code, is amended

24 to read as follows:
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1 ‘‘§ 2311. Delegation

2 ‘‘(a) IN GENERAL.—Except to the extent expressly

3 prohibited by another provision of law, the head of an

4 agency may delegate, subject to his direction, to any other

5 officer or official of that agency, any power under this

6 chapter.

7 ‘‘(b) PROCUREMENTS FOR OR WITH OTHER AGEN8 CIES.—Subject to subsection (a), to facilitate the procure9 ment of property and services covered by this chapter by

10 each agency named in section 2303 of this title for any

11 other agency, and to facilitate joint procurement by those

12 agencies—

13 ‘‘(1) the head of an agency may, within his

14 agency, delegate functions and assign responsibilities

15 relating to procurement;

16 ‘‘(2) the heads of two or more agencies may by

17 agreement delegate procurement functions and as18 sign procurement responsibilities from one agency to

19 another of those agencies or to an officer or civilian

20 employee of another of those agencies; and

21 ‘‘(3) the heads of two or more agencies may

22 create joint or combined offices to exercise procure23 ment functions and responsibilities.

24 ‘‘(c) APPROVAL OF TERMINATIONS AND REDUCTIONS

25 OF JOINT ACQUISITION PROGRAMS.—(1) The Secretary

26 of Defense shall prescribe regulations that prohibit each
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1 military department participating in a joint acquisition

2 program approved by the Under Secretary of Defense for

3 Acquisition from terminating or substantially reducing its

4 participation in such program without the approval of the

5 Under Secretary.

6 ‘‘(2) The regulations shall include the following provi7 sions:

8 ‘‘(A) A requirement that, before any such ter9 mination or substantial reduction in participation is

10 approved, the proposed termination or reduction be

11 reviewed by the Joint Requirements Oversight Coun12 cil of the Department of Defense.

13 ‘‘(B) A provision that authorizes the Under

14 Secretary of Defense for Acquisition to require a

15 military department approved for termination or

16 substantial reduction in participation in a joint ac17 quisition program to continue to provide some or all

18 of the funding necessary for the acquisition program

19 to be continued in an efficient manner.’’.

20 (b) CONFORMING REPEAL.—(1) Section 2308 of title

21 10, United States Code, is repealed.

22 (2) The table of sections at the beginning of chapter

23 137 of such title is amended by striking out the item relat24 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, except to the extent expressly prohibited by an10 other provision of law, for a class of purchases or con11 tracts. Such determinations and decisions are final.

12 ‘‘(b) WRITTEN FINDINGS REQUIRED.—(1) Each de13 termination or decision under section 2306(g)(1), 2307(c),

14 or 2313(c) of this title shall be based on a written finding

15 by the person making the determination or decision. The

16 finding shall set out facts and circumstances that support

17 the determination or decision.

18 ‘‘(2) Each finding referred to in paragraph (1) shall

19 be final. The head of the agency making such finding shall

20 maintain a copy of the finding for not less 6 years after

21 the date of the determination or decision.’’.

22 SEC. 1504. UNDEFINITIZED CONTRACTUAL ACTIONS: RE23 STRICTIONS.

24 (a) CLARIFICATION OF LIMITATION.—Subsection (b)

25 of section 2326 of title 10, United States Code, is amend26 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’’.
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1 SEC. 1507. REPEAL OF EXECUTED REQUIREMENT RELAT2 ING TO CERTIFICATE OF INDEPENDENT

3 PRICE DETERMINATION IN CERTAIN DEPART4 MENT OF DEFENSE CONTRACT SOLICITA5 TIONS.

6 Section 821 of Public Law 101–189 (103 Stat. 1503)

7 is repealed.

8 PART II—CIVILIAN AGENCY ACQUISITIONS

9 SEC. 1551. DEFINITIONS.

10 Section 309(c) of the Federal Property and Adminis11 trative Services Act of 1949 (41 U.S.C. 259(c)) is amend12 ed by striking out ‘‘and ‘supplies’ ’’ and inserting in lieu

13 thereof ‘‘ ‘supplies’, ‘commercial item’, ‘nondevelopmental

14 item’, and ‘simplified acquisition threshold’ ’’.

15 SEC. 1552. DELEGATION OF PROCUREMENT FUNCTIONS.

16 Title III of the Federal Property and Administrative

17 Services Act of 1949 (41 U.S.C. 251 et seq.) is amended—

18 (1) by redesignating sections 309 and 310 as

19 sections 312 and 313, respectively; and

20 (2) by inserting after section 308 the following

21 new section 309:

22 ‘‘DELEGATION

23 ‘‘SEC. 309. (a) IN GENERAL.—Except to the extent

24 expressly prohibited by another provision of law, an agen25 cy head may delegate, subject to his direction, to any other
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1 officer or official of that agency, any power under this

2 title.

3 ‘‘(b) PROCUREMENTS FOR OR WITH OTHER AGEN4 CIES.—Subject to subsection (a), to facilitate the procure5 ment of property and services covered by this title by each

6 executive agency for any other executive agency, and to

7 facilitate joint procurement by those executive agencies—

8 ‘‘(1) an agency head may, within his executive

9 agency, delegate functions and assign responsibilities

10 relating to procurement;

11 ‘‘(2) the heads of two or more executive agen12 cies may by agreement delegate procurement func13 tions and assign procurement responsibilities from

14 one executive agency to another of those executive

15 agencies or to an officer or civilian employee of an16 other of those executive agencies; and

17 ‘‘(3) the heads of two or more executive agen18 cies may create joint or combined offices to exercise

19 procurement functions and responsibilities.’’.

20 SEC. 1553. DETERMINATIONS AND DECISIONS.

21 Title III of the Federal Property and Administrative

22 Services Act of 1949 (41 U.S.C. 251 et seq.), as amended

23 by section 1552, is further amended by inserting after sec24 tion 309 the following new section 310:
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1 ‘‘DETERMINATIONS AND DECISIONS

2 ‘‘SEC. 310. (a) INDIVIDUAL OR CLASS DETERMINA3 TIONS AND DECISIONS AUTHORIZED.—Determinations

4 and decisions required to be made under this title by an

5 agency head may be made for an individual purchase or

6 contract or, except to the extent expressly prohibited by

7 another provision of law, for a class of purchases or con8 tracts. Such determinations and decisions are final.

9 ‘‘(b) WRITTEN FINDINGS REQUIRED.—(1) Each de10 termination under section 305(c) shall be based on a writ11 ten finding by the person making the determination or de12 cision. The finding shall set out facts and circumstances

13 that support the determination or decision.

14 ‘‘(2) Each finding referred to in paragraph (1) shall

15 be final. The agency head making such finding shall main16 tain a copy of the finding for not less 6 years after the

17 date of the determination or decision.’’.

18 SEC. 1554. UNDEFINITIZED CONTRACTUAL ACTIONS: RE19 STRICTIONS.

20 Title III of the Federal Property and Administrative

21 Services Act of 1949 (41 U.S.C. 251 et seq.), as amended

22 by section 1553, is further amended by inserting after sec23 tion 310 the following new section:

24 ‘‘UNDEFINITIZED CONTRACTUAL ACTIONS: RESTRICTIONS

25 ‘‘SEC. 311. (a) IN GENERAL.—An agency head may

26 not enter into an undefinitized contractual action unless
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1 the request to the agency head for authorization of the

2 contractual action includes a description of the anticipated

3 effect on requirements of the executive agency concerned

4 if a delay is incurred for purposes of determining contrac5 tual terms, specifications, and price before performance is

6 begun under the contractual action.

7 ‘‘(b) LIMITATIONS ON OBLIGATIONS OF FUNDS.—(1)

8 A contracting officer of an executive agency may not enter

9 into an undefinitized contractual action unless the con10 tractual action provides for agreement upon contractual

11 terms, specifications, and price by the earlier of—

12 ‘‘(A) the end of the 180-day period beginning

13 on the date on which the contractor submits a quali14 fying proposal (as defined in subsection (f)) to de15 finitize the contractual terms, specifications, and

16 price; or

17 ‘‘(B) the date on which the amount of funds ob18 ligated under the contractual action is equal to more

19 than 50 percent of the negotiated overall ceiling

20 price for the contractual action.

21 ‘‘(2) Except as provided in paragraph (3), the con22 tracting officer for an undefinitized contractual action

23 may not obligate with respect to such contractual action

24 an amount that is equal to more than 50 percent of the

25 negotiated overall ceiling price until the contractual terms,
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1 specifications, and price are definitized for such contrac2 tual action.

3 ‘‘(3) If a contractor submits a qualifying proposal (as

4 defined in subsection (f)) to definitize an undefinitized

5 contractual action before an amount equal to more than

6 50 percent of the negotiated overall ceiling price is obli7 gated on such action, the contracting officer for such ac8 tion may not obligate with respect to such contractual ac9 tion an amount that is equal to more than 75 percent of

10 the negotiated overall ceiling price until the contractual

11 terms, specifications, and price are definitized for such

12 contractual action.

13 ‘‘(4) This subsection does not apply to an

14 undefinitized contractual action for the purchase of initial

15 spares.

16 ‘‘(c) INCLUSION OF NON-URGENT REQUIRE17 MENTS.—Requirements for spare parts and support

18 equipment that are not needed on an urgent basis may

19 not be included in an undefinitized contractual action for

20 spare parts and support equipment that are needed on an

21 urgent basis unless the agency head approves such inclu22 sion as being—

23 ‘‘(1) good business practice; and

24 ‘‘(2) in the best interests of the United States.
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1 ‘‘(d) MODIFICATION OF SCOPE.—The scope of an

2 undefinitized contractual action under which performance

3 has begun may not be modified unless the agency head

4 approves such modification as being—

5 ‘‘(1) good business practice; and

6 ‘‘(2) in the best interests of the United States.

7 ‘‘(e) ALLOWABLE PROFIT.—An agency head shall en8 sure that the profit allowed on an undefinitized contrac9 tual action for which the final price is negotiated after

10 a substantial portion of the performance required is com11 pleted reflects—

12 ‘‘(1) the possible reduced cost risk of the con13 tractor with respect to costs incurred during per14 formance of the contract before the final price is ne15 gotiated; and

16 ‘‘(2) the reduced cost risk of the contractor

17 with respect to costs incurred during performance of

18 the remaining portion of the contract.

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

20 ‘‘(1) The term ‘undefinitized contractual action’

21 means a new procurement action entered into by an

22 agency head for which the contractual terms, speci23 fications, or price are not agreed upon before per24 formance is begun under the action. Such term does
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1 not include contractual actions with respect to the

2 following:

3 ‘‘(A) Purchases in an amount not in excess

4 of the amount of the simplified acquisition

5 threshold.

6 ‘‘(B) Congressionally mandated long-lead

7 procurement contracts.

8 ‘‘(2) The term ‘qualifying proposal’ means a

9 proposal that contains sufficient information to en10 able the agency head concerned to conduct complete

11 and meaningful audits of the information contained

12 in the proposal and of any other information that

13 the agency head is entitled to review in connection

14 with the contract, as determined by the contracting

15 officer.’’.

16 SEC. 1555. REPEAL OF AMENDMENTS TO UNCODIFIED

17 TITLE.

18 The following provisions of law are repealed:

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

20 Stat. 1470) and the matter set out in quotes in that

21 section.

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

23 Stat. 1761) and the matter inserted and added by

24 that section.
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1 TITLE II—CONTRACT

2 ADMINISTRATION

3 Subtitle A—Contract Payment

4 PART I—ARMED SERVICES ACQUISITIONS

5 SEC. 2001. CONTRACT FINANCING.

6 (a) REORGANIZATION OF PRINCIPAL AUTHORITY

7 PROVISION.—Section 2307 of title 10, United States

8 Code, is amended—

9 (1) by striking out the section heading and in10 serting in lieu thereof the following:

11 ‘‘§ 2307. Contract financing’’;

12 (2) by striking out ‘‘(a) The head of an agency’’

13 and inserting in lieu thereof ‘‘(b) PAYMENT AU14 THORITY.—The head of an agency’’;

15 (3) by striking out ‘‘(b) Payments’’ and insert16 ing in lieu thereof ‘‘(c) PAYMENT AMOUNT.—Pay17 ments’’;

18 (4) by striking out ‘‘(c) Advance payments’’ and

19 inserting in lieu thereof ‘‘(d) SECURITY FOR AD20 VANCE PAYMENTS.—Advance payments’’;

21 (5) by striking out ‘‘(d)(1) The Secretary of

22 Defense’’ and inserting in lieu thereof ‘‘(e) CONDI23 TIONS FOR PROGRESS PAYMENTS.—(1) The Sec24 retary of Defense’’; and
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1 (6) by striking out ‘‘(e)(1) In any case’’ and in2 serting in lieu thereof ‘‘(g) ACTION IN CASE OF

3 FRAUD.—(1) In any case’’.

4 (b) FINANCING POLICY.—Such section, as amended

5 by subsection (a), is further amended by inserting after

6 the section heading the following new subsection (a):

7 ‘‘(a) POLICY.—Payments authorized under this sec8 tion and made for financing purposes should be made peri9 odically and in a timely manner to facilitate contract per10 formance while protecting the security interests of the

11 Government. Government financing shall be provided only

12 to the extent necessary to ensure prompt and efficient per13 formance and only after the availability of private financ14 ing is considered. A contractor’s use of funds received as

15 contract financing and the contractor’s financial condition

16 shall be monitored. If the contractor is a small business

17 concern, special attention shall be given to meeting the

18 contractor’s financial need.’’.

19 (c) TERMINOLOGY CORRECTION.—Such section, as

20 amended by subsection (a)(2), is further amended in sub21 section (b)(2) by striking out ‘‘bid’’.

22 (d) EFFECTIVE DATE OF LIEN RELATED TO AD23 VANCE PAYMENTS.—Such section, as amended by sub24 section (a)(4), is further amended in subsection (d) by in25 serting before the period at the end of the third sentence
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1 the following: ‘‘and is effective immediately upon the first

2 advancement of funds without filing, notice, or any other

3 action by the United States’’.

4 (e) CONDITIONS FOR PROGRESS PAYMENTS.—Such

5 section, as amended by subsection (a)(5), is further

6 amended in subsection (e)—

7 (1) in the first sentence of paragraph (1), by

8 striking out ‘‘work, which’’ and all that follows

9 through ‘‘accomplished’’ and inserting in lieu thereof

10 ‘‘work accomplished that meets standards estab11 lished under the contract’’; and

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

13 in lieu thereof the following:

14 ‘‘(3) This subsection applies to a contract for an

15 amount equal to or greater than the simplified acquisition

16 threshold.’’.

17 (f) NAVY CONTRACTS.—Such section, as amended by

18 subsection (a)(5), is further amended by inserting after

19 subsection (e) the following new subsection (f):

20 ‘‘(f) CERTAIN NAVY CONTRACTS.—(1) The Secretary

21 of the Navy shall provide that the rate for progress pay22 ments on any contract awarded by the Secretary for re23 pair, maintenance, or overhaul of a naval vessel shall be

24 not less than—
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1 ‘‘(A) 95 percent, in the case of firms considered

2 to be small businesses; and

3 ‘‘(B) 90 percent, in the case of all other firms.

4 ‘‘(2) The Secretary of the Navy may advance to pri5 vate salvage companies such funds as the Secretary con6 siders necessary to provide for the immediate financing

7 of salvage operations. Advances under this paragraph shall

8 be made on terms that the Secretary considers adequate

9 for the protection of the United States.

10 ‘‘(3) The Secretary of the Navy shall ensure that,

11 when partial, progress, or other payments are made under

12 a contract for construction or conversion of a naval vessel,

13 the United States is secured by a lien upon work in

14 progress and on property acquired for performance of the

15 contract on account of all payments so made. The lien is

16 paramount to all other liens.’’.

17 (g) CONFORMING AND CLERICAL AMENDMENTS.—

18 (1) CROSS REFERENCE.—Such section, as

19 amended by subsection (a), is further amended in

20 subsections (c) and (d) by striking out ‘‘subsection

21 (a)’’ and inserting in lieu thereof ‘‘subsection (b)’’.

22 (2) TABLE OF CONTENTS.—The table of sec23 tions at the beginning of chapter 137 of title 10,

24 United States Code, is amended by striking out the
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1 item relating to section 2307 and inserting in lieu

2 thereof the following:

‘‘2307. Contract financing.’’.

3 (h) REPEAL OF SUPERSEDED PROVISIONS.—

4 (1) PROGRESS PAYMENTS UNDER CERTAIN

5 NAVY CONTRACTS.—

6 (A) REPEAL.—Section 7312 of title 10,

7 United States Code, is repealed.

8 (B) CLERICAL AMENDMENT.—The table of

9 sections at the beginning of chapter 633 of such

10 title is amended by striking out the item relat11 ing to section 7312.

12 (2) ADVANCEMENT OF PAYMENTS FOR NAVY

13 SALVAGE OPERATIONS.—

14 (A) REPEAL.—Section 7364 of such title is

15 repealed.

16 (B) CLERICAL AMENDMENT.—The table of

17 sections at the beginning of chapter 637 of such

18 title is amended by striking out the item relat19 ing to section 7364.

20 (3) PARTIAL PAYMENTS UNDER NAVY CON21 TRACTS—

22 (A) REPEAL.—Section 7521 of such title is

23 repealed.

24 (B) CLERICAL AMENDMENT.—The table of

25 sections at the beginning of chapter 645 of such
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1 title is amended by striking out the item relat2 ing to section 7521.

3 (4) NAVY RESEARCH CONTRACTS.—Section

4 7522 of title 10, United States Code, is amended—

5 (A) by striking out subsection (b); and

6 (B) by redesignating subsection (c) as sub7 section (b).

8 SEC. 2002. CONTRACTS: VOUCHERING PROCEDURES.

9 (a) REPEAL.—Section 2355 of title 10, United States

10 Code, is repealed.

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

12 at the beginning of chapter 139 of such title is amended

13 by striking out the item relating to section 2355.

14 PART II—CIVILIAN AGENCY ACQUISITIONS

15 SEC. 2051. CONTRACT FINANCING.

16 (a) REORGANIZATION OF PRINCIPAL AUTHORITY

17 PROVISION.—Section 305 of the Federal Property and

18 Administrative Services Act of 1949 (41 U.S.C. 255) is

19 amended—

20 (1) by striking out the section heading and in21 serting in lieu thereof the following:

22 ‘‘CONTRACT FINANCING’’;

23 (2) by striking out ‘‘(a) Any executive agency’’

24 and inserting in lieu thereof ‘‘(b) PAYMENT AU25 THORITY.—Any executive agency’’;
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1 (3) by striking out ‘‘(b) Payments’’ and insert2 ing in lieu thereof ‘‘(c) PAYMENT AMOUNT.—Pay3 ments’’; and

4 (4) by striking out ‘‘(c) Advance payments’’ and

5 inserting in lieu thereof ‘‘(d) SECURITY FOR AD6 VANCE PAYMENTS.—Advance payments’’.

7 (b) FINANCING POLICY.—Such section, as amended

8 by subsection (a), is further amended by inserting after

9 the section heading the following new subsection (a):

10 ‘‘(a) POLICY.—Payments authorized under this sec11 tion and made for financing purposes should be made peri12 odically and in a timely manner to facilitate contract per13 formance 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) TERMINOLOGY CORRECTION.—Such section, as

23 amended by subsection (a)(2), is further amended in sub24 section (b)(2) by striking out ‘‘bid’’.
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1 (d) EFFECTIVE DATE OF LIEN RELATED TO AD2 VANCE PAYMENTS.—Such section, as amended by sub3 section (a)(4), is further amended in subsection (d) by in4 serting before the period at the end of the third sentence

5 the following: ‘‘and is effective immediately upon the first

6 advancement of funds without filing, notice, or any other

7 action by the United States’’.

8 (e) REVISION OF CIVILIAN AGENCY PROVISION TO

9 ENSURE UNIFORM REQUIREMENTS FOR PROGRESS PAY10 MENTS.—

11 (1) IN GENERAL.—Such section, as amended by

12 subsection (a), is further amended by adding at the

13 end the following:

14 ‘‘(e) CONDITIONS FOR PROGRESS PAYMENTS.—(1)

15 The agency head shall ensure that any payment for work

16 in progress (including materials, labor, and other items)

17 under a contract of an executive agency that provides for

18 such payments is commensurate with the work accom19 plished that meets standards established under the con20 tract. The contractor shall provide such information and

21 evidence as the agency head determines necessary to per22 mit the agency head to carry out the preceding sentence.

23 ‘‘(2) The agency head shall ensure that progress pay24 ments referred to in paragraph (1) are not made for more

25 than 80 percent of the work accomplished under the con-
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1 tract so long as the agency head has not made the contrac2 tual terms, specifications, and price definite.

3 ‘‘(3) This subsection applies to a contract for an

4 amount equal to or greater than the simplified acquisition

5 threshold.

6 ‘‘(f) ACTION IN CASE OF FRAUD.—(1) In any case

7 in which the remedy coordination official of an executive

8 agency finds that there is substantial evidence that the

9 request of a contractor for advance, partial, or progress

10 payment under a contract awarded by that executive agen11 cy is based on fraud, the remedy coordination official shall

12 recommend that the agency head reduce or suspend fur13 ther payments to such contractor.

14 ‘‘(2) An agency head receiving a recommendation

15 under paragraph (1) in the case of a contractor’s request

16 for payment under a contract shall determine whether

17 there is substantial evidence that the request is based on

18 fraud. Upon making such a determination, the agency

19 head may reduce or suspend further payments to the con20 tractor under such contract.

21 ‘‘(3) The extent of any reduction or suspension of

22 payments by an agency head under paragraph (2) on the

23 basis of fraud shall be reasonably commensurate with the

24 anticipated loss to the United States resulting from the

25 fraud.
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1 ‘‘(4) A written justification for each decision of the

2 agency head whether to reduce or suspend payments

3 under paragraph (2), and for each recommendation re4 ceived by the agency head in connection with such deci5 sion, shall be prepared and be retained in the files of the

6 executive agency.

7 ‘‘(5) Each agency head shall prescribe procedures to

8 ensure that, before the agency head decides to reduce or

9 suspend payments in the case of a contractor under para10 graph (2), the contractor is afforded notice of the pro11 posed reduction or suspension and an opportunity to sub12 mit matters to the head of the agency in response to such

13 proposed reduction or suspension.

14 ‘‘(6) Not later than 180 days after the date on which

15 an agency head reduces or suspends payments to a con16 tractor under paragraph (2), the remedy coordination offi17 cial of the executive agency shall—

18 ‘‘(A) review the determination of fraud on

19 which the reduction or suspension is based; and

20 ‘‘(B) transmit a recommendation to the agency

21 head whether the suspension or reduction should

22 continue.

23 ‘‘(7) Each agency head who receives recommenda24 tions made by a remedy coordination official of the execu25 tive agency to reduce or suspend payments under para-
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1 graph (2) during a fiscal year shall prepare for such year

2 a report that contains the recommendations, the actions

3 taken on the recommendations and the reasons for such

4 actions, and an assessment of the effects of such actions

5 on the Federal Government. Any such report shall be

6 available to any Member of Congress upon request.

7 ‘‘(8) An agency head may not delegate responsibilities

8 under this subsection to any person in a position below

9 level IV of the Executive Schedule.

10 ‘‘(9) In this subsection, the term ‘remedy coordina11 tion official’, with respect to an executive agency, means

12 the person or entity in that executive agency who coordi13 nates within that executive agency the administration of

14 criminal, civil, administrative, and contractual remedies

15 resulting from investigations of fraud or corruption related

16 to procurement activities.’’.

17 (2) RELATIONSHIP TO PROMPT PAYMENT RE18 QUIREMENTS.—The amendments made by para19 graph (1) are not intended to impair or modify pro20 cedures required by the provisions of chapter 39 of

21 title 31, United States Code, and the regulations is22 sued pursuant to such provisions of law, that relate

23 to progress payment requests, as such procedures

24 are in effect on the date of the enactment of this

25 Act.
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1 (f) CONFORMING AND CLERICAL AMENDMENTS.—

2 (1) REFERENCE.—Section 305 of the Federal

3 Property and Administrative Services Act of 1949,

4 as amended by subsection (a), is further amended in

5 subsections (c) and (d) by striking out ‘‘subsection

6 (a)’’ and inserting in lieu thereof ‘‘subsection (b)’’.

7 (2) TABLE OF CONTENTS.—The table of con8 tents in the first section of such Act is amended by

9 striking out the item relating to section 305 and in10 serting in lieu thereof the following:

‘‘Sec. 305. Contract financing.’’.

11 Subtitle B—Cost Principles

12 PART I—ARMED SERVICES ACQUISITIONS

13 SEC. 2101. ALLOWABLE CONTRACT COSTS.

14 (a) COMPTROLLER GENERAL EVALUATION.—Sub15 section (l) of section 2324 of title 10, United States Code,

16 is amended to read as follows:

17 ‘‘(l)(1) The Comptroller General shall periodically

18 evaluate the implementation of this section by the Sec19 retary of Defense. Such evaluation shall consider the ex20 tent to which—

21 ‘‘(A) the implementation is consistent with con22 gressional intent;

23 ‘‘(B) the implementation achieves the objective

24 of eliminating unallowable costs charged to covered

25 contracts; and
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1 ‘‘(C) the implementation (as well as the provi2 sions of this section and the regulations prescribed

3 under this section) could be improved or strength4 ened.

5 ‘‘(2) The Comptroller General shall submit to the

6 Committees on Armed Services and the Committees on

7 Appropriations of the Senate and House of Representa8 tives a report on such evaluation within 90 days after pub9 lication by the Secretary of Defense in the Federal Reg10 ister of regulations that make substantive changes in regu11 lations pertaining to allowable costs under covered con12 tracts.’’.

13 (b) COVERED CONTRACT DEFINED.—Subsection (m)

14 of such section is amended to read as follows:

15 ‘‘(m) In this section, the term ‘covered contract’

16 means a contract for an amount in excess of $500,000

17 that is entered into by the Department of Defense, except

18 that such term does not include a fixed-price contract

19 without cost incentives.’’.

20 SEC. 2102. CONTRACT PROFIT CONTROLS DURING EMER21 GENCY PERIODS.

22 (a) REPEAL.—Section 2382 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 141 of such title is amended

3 by striking out the item relating to section 2382.

4 PART II—CIVILIAN AGENCY ACQUISITIONS

5 SEC. 2151. ALLOWABLE CONTRACT COSTS.

6 (a) REVISION OF CIVILIAN AGENCY PROVISION TO

7 ENSURE UNIFORM TREATMENT OF CONTRACT COSTS.—

8 Section 306 of the Federal Property and Administrative

9 Services Act of 1949 (41 U.S.C. 256) is amended to read

10 as follows:

11 ‘‘ALLOWABLE COSTS

12 ‘‘SEC. 306. (a) INDIRECT COST THAT VIOLATES A

13 FAR COST PRINCIPLE.—The head of an executive agency

14 shall require that a covered contract provide that if the

15 contractor submits to the executive agency a proposal for

16 settlement of indirect costs incurred by the contractor for

17 any period after such costs have been accrued and if that

18 proposal includes the submission of a cost which is unal19 lowable because the cost violates a cost principle in the

20 Federal Acquisition Regulation or an executive agency’s

21 supplement to the Federal Acquisition Regulation, the cost

22 shall be disallowed.

23 ‘‘(b) PENALTY FOR VIOLATION OF COST PRIN24 CIPLE.—(1) If the agency head determines that a cost

25 submitted by a contractor in its proposal for settlement

26 is expressly unallowable under a cost principle referred to
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1 in subsection (a) that defines the allowability of specific

2 selected costs, the agency head shall assess a penalty

3 against the contractor in an amount equal to—

4 ‘‘(A) the amount of the disallowed cost allo5 cated to covered contracts for which a proposal for

6 settlement of indirect costs has been submitted; plus

7 ‘‘(B) interest (to be computed based on regula8 tions issued by the agency head) to compensate the

9 United States for the use of any funds which a con10 tractor has been paid in excess of the amount to

11 which the contractor was entitled.

12 ‘‘(2) If the agency head determines that a proposal

13 for settlement of indirect costs submitted by a contractor

14 includes a cost determined to be unallowable in the case

15 of such contractor before the submission of such proposal,

16 the agency head shall assess a penalty against the contrac17 tor in an amount equal to two times the amount of the

18 disallowed cost allocated to covered contracts for which a

19 proposal for settlement of indirect costs has been submit20 ted.

21 ‘‘(c) WAIVER OF PENALTY.—The agency head shall

22 prescribe regulations providing for a penalty under sub23 section (b) to be waived in the case of a contractor’s pro24 posal for settlement of indirect costs when—
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1 ‘‘(1) the contractor withdraws the proposal be2 fore the formal initiation of an audit of the proposal

3 by the Federal Government and resubmits a revised

4 proposal;

5 ‘‘(2) the amount of unallowable costs subject to

6 the penalty is insignificant; or

7 ‘‘(3) the contractor demonstrates, to the con8 tracting officer’s satisfaction, that—

9 ‘‘(A) it has established appropriate policies

10 and personnel training and an internal control

11 and review system that provide assurances that

12 unallowable costs subject to penalties are pre13 cluded from being included in the contractor’s

14 proposal for settlement of indirect costs; and

15 ‘‘(B) the unallowable costs subject to the

16 penalty were inadvertently incorporated into the

17 proposal.

18 ‘‘(d) APPLICABILITY OF CONTRACT DISPUTES PRO19 CEDURE TO DISALLOWANCE OF COST AND ASSESSMENT

20 OF PENALTY.—An action of an agency head under sub21 section (a) or (b)—

22 ‘‘(1) shall be considered a final decision for the

23 purposes of section 6 of the Contract Disputes Act

24 of 1978 (41 U.S.C. 605); and
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1 ‘‘(2) is appealable in the manner provided in

2 section 7 of such Act.

3 ‘‘(e) SPECIFIC COSTS NOT ALLOWABLE.—(1) The

4 following costs are not allowable under a covered contract:

5 ‘‘(A) Costs of entertainment, including amuse6 ment, diversion, and social activities, and any costs

7 directly associated with such costs (such as tickets

8 to shows or sports events, meals, lodging, rentals,

9 transportation, and gratuities).

10 ‘‘(B) Costs incurred to influence (directly or in11 directly) legislative action on any matter pending be12 fore Congress or a State legislature.

13 ‘‘(C) Costs incurred in defense of any civil or

14 criminal fraud proceeding or similar proceeding (in15 cluding filing of any false certification) brought by

16 the United States where the contractor is found lia17 ble or had pleaded nolo contendere to a charge of

18 fraud or similar proceeding (including filing of a

19 false certification).

20 ‘‘(D) Payments of fines and penalties resulting

21 from violations of, or failure to comply with, Fed22 eral, State, local, or foreign laws and regulations, ex23 cept when incurred as a result of compliance with

24 specific terms and conditions of the contract or spe25 cific written instructions from the contracting officer
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1 authorizing in advance such payments in accordance

2 with applicable regulations of the agency head con3 cerned.

4 ‘‘(E) Costs of membership in any social, dining,

5 or country club or organization.

6 ‘‘(F) Costs of alcoholic beverages.

7 ‘‘(G) Contributions or donations, regardless of

8 the recipient.

9 ‘‘(H) Costs of advertising designed to promote

10 the contractor or its products.

11 ‘‘(I) Costs of promotional items and memora12 bilia, including models, gifts, and souvenirs.

13 ‘‘(J) Costs for travel by commercial aircraft

14 which exceed the amount of the standard commercial

15 fare.

16 ‘‘(K) Costs incurred in making any payment

17 (commonly known as a ‘golden parachute payment’)

18 which is—

19 ‘‘(i) in an amount in excess of the normal

20 severance pay paid by the contractor to an em21 ployee upon termination of employment; and

22 ‘‘(ii) is paid to the employee contingent

23 upon, and following, a change in management

24 control over, or ownership of, the contractor or

25 a substantial portion of the contractor’s assets.
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1 ‘‘(L) Costs of commercial insurance that pro2 tects against the costs of the contractor for correc3 tion of the contractor’s own defects in materials or

4 workmanship.

5 ‘‘(M) Costs of severance pay paid by the con6 tractor to foreign nationals employed by the contrac7 tor under a service contract performed outside the

8 United States, to the extent that the amount of sev9 erance pay paid in any case exceeds the amount paid

10 in the industry involved under the customary or pre11 vailing practice for firms in that industry providing

12 similar services in the United States, as determined

13 under regulations prescribed by the agency head

14 concerned.

15 ‘‘(N) Costs of severance pay paid by the con16 tractor to a foreign national employed by the con17 tractor under a service contract performed in a for18 eign country if the termination of the employment of

19 the foreign national is the result of the closing of,

20 or the curtailment of activities at, a United States

21 facility in that country at the request of the govern22 ment of that country.

23 ‘‘(O) Costs incurred by a contractor in connec24 tion with any criminal, civil, or administrative pro-
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1 ceeding commenced by the United States or a State,

2 to the extent provided in subsection (k).

3 ‘‘(2)(A) Pursuant to regulations prescribed by the

4 head of the executive agency concerned and subject to the

5 availability of appropriations, the agency head, in award6 ing a covered contract, may waive the application of the

7 provisions of paragraphs (1)(M) and (1)(N) to that con8 tract if the agency head determines that—

9 ‘‘(i) the application of such provisions to the

10 contract would adversely affect the continuation of a

11 program, project, or activity that provides significant

12 support services for employees of the executive agen13 cy posted outside the United States;

14 ‘‘(ii) the contractor has taken (or has estab15 lished plans to take) appropriate actions within the

16 contractor’s control to minimize the amount and

17 number of incidents of the payment of severance pay

18 by the contractor to employees under the contract

19 who are foreign nationals; and

20 ‘‘(iii) the payment of severance pay is necessary

21 in order to comply with a law that is generally appli22 cable to a significant number of businesses in the

23 country in which the foreign national receiving the

24 payment performed services under the contract or is
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1 necessary to comply with a collective bargaining

2 agreement.

3 ‘‘(B) The head of the executive agency concerned

4 shall include in the solicitation for a covered contract a

5 statement indicating—

6 ‘‘(i) that a waiver has been granted under sub7 paragraph (A) for the contract; or

8 ‘‘(ii) whether the agency head will consider

9 granting such a waiver, and, if the agency head will

10 consider granting a waiver, the criteria to be used in

11 granting the waiver.

12 ‘‘(C) The agency head shall make the final determina13 tion regarding whether to grant a waiver under subpara14 graph (A) with respect to a covered contract before award

15 of the contract.

16 ‘‘(3) The head of each executive agency concerned

17 shall prescribe regulations to implement this section with

18 respect to contracts of that executive agency. Such regula19 tions may establish appropriate definitions, exclusions,

20 limitations, and qualifications.

21 ‘‘(f) REQUIRED REGULATIONS.—(1) The Federal Ac22 quisition Regulation referred to in section 25(c)(1) of the

23 Office of Federal Procurement Policy Act (41 U.S.C.

24 421(c)(1)) shall contain provisions on the allowability of

25 contractor costs. Such provisions shall define in detail and
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1 in specific terms those costs which are unallowable, in

2 whole or in part, under covered contracts. The regulations

3 shall, at a minimum, clarify the cost principles applicable

4 to contractor costs of the following:

5 ‘‘(A) Air shows.

6 ‘‘(B) Membership in civic, community, and pro7 fessional organizations.

8 ‘‘(C) Recruitment.

9 ‘‘(D) Employee morale and welfare.

10 ‘‘(E) Actions to influence (directly or indirectly)

11 executive branch action on regulatory and contract

12 matters (other than costs incurred in regard to con13 tract proposals pursuant to solicited or unsolicited

14 bids).

15 ‘‘(F) Community relations.

16 ‘‘(G) Dining facilities.

17 ‘‘(H) Professional and consulting services, in18 cluding legal services.

19 ‘‘(I) Compensation.

20 ‘‘(J) Selling and marketing.

21 ‘‘(K) Travel.

22 ‘‘(L) Public relations.

23 ‘‘(M) Hotel and meal expenses.

24 ‘‘(N) Expense of corporate aircraft.

25 ‘‘(O) Company-furnished automobiles.
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1 ‘‘(P) Advertising.

2 ‘‘(2) The Federal Acquisition Regulation shall require

3 that a contracting officer not resolve any questioned costs

4 until the contracting officer has obtained—

5 ‘‘(A) adequate documentation with respect to

6 such costs; and

7 ‘‘(B) the opinion of the executive agency’s con8 tract auditor on the allowability of such costs.

9 ‘‘(3) The Federal Acquisition Regulation shall pro10 vide that, to the maximum extent practicable, an executive

11 agency’s contract auditor be present at any negotiation or

12 meeting with the contractor regarding a determination of

13 the allowability of indirect costs of the contractor.

14 ‘‘(4) The Federal Acquisition Regulation shall require

15 that all categories of costs designated in the report of an

16 executive agency’s contract auditor as questioned with re17 spect to a proposal for settlement be resolved in such a

18 manner that the amount of the individual questioned costs

19 that are paid will be reflected in the settlement.

20 ‘‘(g) APPLICABILITY OF REQUIRED REGULATIONS.—

21 The regulations required to be prescribed under sub22 sections (e) and (f)(1) shall require, to the maximum ex23 tent practicable, that such regulations apply to all sub24 contractors of a covered contract.
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1 ‘‘(h) CONTRACTOR CERTIFICATION REQUIRED.—(1)

2 A proposal for settlement of indirect costs applicable to

3 a covered contract shall include a certification by an offi4 cial of the contractor that, to the best of the certifying

5 official’s knowledge and belief, all indirect costs included

6 in the proposal are allowable. Any such certification shall

7 be in a form prescribed by the agency head concerned.

8 ‘‘(2) The agency head concerned may, in an excep9 tional case, waive the requirement for certification under

10 paragraph (1) in the case of any contract if the agency

11 head—

12 ‘‘(A) determines in such case that it would be

13 in the interest of the United States to waive such

14 certification; and

15 ‘‘(B) states in writing the reasons for that de16 termination and makes such determination available

17 to the public.

18 ‘‘(i) PENALTIES FOR SUBMISSION OF COST KNOWN

19 AS NOT ALLOWABLE.—The submission to an executive

20 agency of a proposal for settlement of costs for any period

21 after such costs have been accrued that includes a cost

22 that is expressly specified by statute or regulation as being

23 unallowable, with the knowledge that such cost is unallow24 able, shall be subject to the provisions of section 287 of
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1 title 18, United States Code, and section 3729 of title 31,

2 United States Code.

3 ‘‘(j) CONTRACTOR TO HAVE BURDEN OF PROOF.—

4 In a proceeding before a board of contract appeals, the

5 United States Court of Federal Claims, or any other Fed6 eral court in which the reasonableness of indirect costs for

7 which a contractor seeks reimbursement from the United

8 States is in issue, the burden of proof shall be upon the

9 contractor to establish that those costs are reasonable.

10 ‘‘(k) PROCEEDING COSTS NOT ALLOWABLE.—(1)

11 Except as otherwise provided in this subsection, costs in12 curred by a contractor in connection with any criminal,

13 civil, or administrative proceeding commenced by the

14 United States or a State are not allowable as reimbursable

15 costs under a covered contract if the proceeding (A) re16 lates to a violation of, or failure to comply with, a Federal

17 or State statute or regulation, and (B) results in a disposi18 tion described in paragraph (2).

19 ‘‘(2) A disposition referred to in paragraph (1)(B) is

20 any of the following:

21 ‘‘(A) In the case of a criminal proceeding, a

22 conviction (including a conviction pursuant to a plea

23 of nolo contendere) by reason of the violation or fail24 ure referred to in paragraph (1).
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1 ‘‘(B) In the case of a civil or administrative

2 proceeding involving an allegation of fraud or similar

3 misconduct, a determination of contractor liability

4 on the basis of the violation or failure referred to in

5 paragraph (1).

6 ‘‘(C) In the case of any civil or administrative

7 proceeding, the imposition of a monetary penalty by

8 reason of the violation or failure referred to in para9 graph (1).

10 ‘‘(D) A final decision—

11 ‘‘(i) to debar or suspend the contractor,

12 ‘‘(ii) to rescind or void the contract, or

13 ‘‘(iii) to terminate the contract for default,

14 by reason of the violation or failure referred to in

15 paragraph (1).

16 ‘‘(E) A disposition of the proceeding by consent

17 or compromise if such action could have resulted in

18 a disposition described in subparagraph (A), (B),

19 (C), or (D).

20 ‘‘(3) In the case of a proceeding referred to in para21 graph (1) that is commenced by the United States and

22 is resolved by consent or compromise pursuant to an

23 agreement entered into by a contractor and the United

24 States, the costs incurred by the contractor in connection

25 with such proceeding that are otherwise not allowable as
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1 reimbursable costs under such paragraph may be allowed

2 to the extent specifically provided in such agreement.

3 ‘‘(4) In the case of a proceeding referred to in para4 graph (1) that is commenced by a State, the agency head

5 that awarded the covered contract involved in the proceed6 ing may allow the costs incurred by the contractor in con7 nection with such proceeding as reimbursable costs if the

8 agency head determines, under regulations prescribed by

9 such agency head, that the costs were incurred as a result

10 of (A) a specific term or condition of the contract, or (B)

11 specific written instructions of the agency.

12 ‘‘(5)(A) Except as provided in subparagraph (C),

13 costs incurred by a contractor in connection with a crimi14 nal, civil, or administrative proceeding commenced by the

15 United States or a State in connection with a covered con16 tract may be allowed as reimbursable costs under the con17 tract if such costs are not disallowable under paragraph

18 (1), but only to the extent provided in subparagraph (B).

19 ‘‘(B)(i) The amount of the costs allowable under sub20 paragraph (A) in any case may not exceed the amount

21 equal to 80 percent of the amount of the costs incurred,

22 to the extent that such costs are determined to be other23 wise allowable and allocable under the Federal Acquisition

24 Regulation.
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1 ‘‘(ii) Regulations issued for the purpose of clause (i)

2 shall provide for appropriate consideration of the complex3 ity of procurement litigation, generally accepted principles

4 governing the award of legal fees in civil actions involving

5 the United States as a party, and such other factors as

6 may be appropriate.

7 ‘‘(C) In the case of a proceeding referred to in sub8 paragraph (A), contractor costs otherwise allowable as re9 imbursable costs under this paragraph are not allowable

10 if (i) such proceeding involves the same contractor mis11 conduct alleged as the basis of another criminal, civil, or

12 administrative proceeding, and (ii) the costs of such other

13 proceeding are not allowable under paragraph (1).

14 ‘‘(6) In this subsection:

15 ‘‘(A) The term ‘proceeding’ includes an inves16 tigation.

17 ‘‘(B) The term ‘costs’, with respect to a pro18 ceeding—

19 ‘‘(i) means all costs incurred by a contrac20 tor, whether before or after the commencement

21 of any such proceeding; and

22 ‘‘(ii) includes—

23 ‘‘(I) administrative and clerical ex24 penses;
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1 ‘‘(II) the cost of legal services, includ2 ing legal services performed by an em3 ployee of the contractor;

4 ‘‘(III) the cost of the services of ac5 countants and consultants retained by the

6 contractor; and

7 ‘‘(IV) the pay of directors, officers,

8 and employees of the contractor for time

9 devoted by such directors, officers, and em10 ployees to such proceeding.

11 ‘‘(C) The term ‘penalty’ does not include res12 titution, reimbursement, or compensatory damages.

13 ‘‘(l) PERIODIC EVALUATION OF IMPLEMENTATION.—

14 (1) The Comptroller General shall periodically evaluate

15 the implementation of this section by the heads of execu16 tive agencies. Such evaluation shall consider the extent to

17 which—

18 ‘‘(A) the implementation is consistent with con19 gressional intent;

20 ‘‘(B) the implementation achieves the objective

21 of eliminating unallowable costs charged to covered

22 contracts; and

23 ‘‘(C) the implementation (as well as the provi24 sions of this section and the regulations prescribed
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1 under this section) could be improved or strength2 ened.

3 ‘‘(2) The Comptroller General shall submit to the

4 Committees on Governmental Affairs and on Appropria5 tions of the Senate and the Committees on Government

6 Operation and on Appropriations of the House of Rep7 resentatives a report on such evaluation within 90 days

8 after the head of any executive agency publishes in the

9 Federal Register regulations that make substantive

10 changes in regulations pertaining to allowable costs under

11 covered contracts.

12 ‘‘(m) COVERED CONTRACT DEFINED.—In this sec13 tion, the term ‘covered contract’ means a contract for an

14 amount in excess of $500,000 that is entered into by an

15 executive agency, except that such term does not include

16 a fixed-price contract without cost incentives.’’.

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

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

19 the item relating to section 306 and inserting in lieu there20 of the following:

‘‘Sec. 306. Allowable costs.’’.

21 PART III—ACQUISITIONS GENERALLY

22 SEC. 2191. TRAVEL EXPENSES OF GOVERNMENT CONTRAC23 TORS.

24 Section 24 of the Office of Federal Procurement Pol25 icy Act (41 U.S.C. 420) is repealed.
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1 Subtitle C—Audit and Access to

2 Records

3 PART I—ARMED SERVICES ACQUISITIONS

4 SEC. 2201. CONSOLIDATION AND REVISION OF AUTHORITY

5 TO EXAMINE RECORDS OF CONTRACTORS.

6 (a) AUTHORITY.—

7 (1) IN GENERAL.—Section 2313 of title 10,

8 United States Code, is amended to read as follows:

9 ‘‘§ 2313. Examination of records of contractor

10 ‘‘(a) AGENCY AUTHORITY.—The head of an agency,

11 acting through an authorized representative—

12 ‘‘(1) is entitled to inspect the plant and audit

13 the records of—

14 ‘‘(A) a contractor performing a cost-reim15 bursement, incentive, time-and-materials, labor16 hour, or price-redeterminable contract, or any

17 combination of such contracts, made by that

18 agency under this chapter; and

19 ‘‘(B) a subcontractor performing any sub20 contract under such a contract or combination

21 of contracts; and

22 ‘‘(2) shall, for the purpose of evaluating the ac23 curacy, completeness, and currency of cost or pricing

24 data required to be submitted pursuant to section

25 2306a of this title with respect to a contract or sub-
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1 contract, have the right to examine all records of the

2 contractor or subcontractor related to—

3 ‘‘(A) the proposal for the contract or sub4 contract;

5 ‘‘(B) the discussions conducted on the pro6 posal;

7 ‘‘(C) pricing of the contract or subcontract;

8 or

9 ‘‘(D) performance of the contract or sub10 contract.

11 ‘‘(b) SUBPOENA POWER.—(1) The Director of the

12 Defense Contract Audit Agency (or any successor agency)

13 may require by subpoena the production of records of a

14 contractor, access to which is provided to the Secretary

15 of Defense by subsection (a).

16 ‘‘(2) Any such subpoena, in the case of contumacy

17 or refusal to obey, shall be enforceable by order of an ap18 propriate United States district court.

19 ‘‘(3) The authority provided by paragraph (1) may

20 not be redelegated.

21 ‘‘(4) The Director (or any successor official) shall

22 submit an annual report to the Secretary of Defense on

23 the exercise of such authority during the preceding year

24 and the reasons why such authority was exercised in any

25 instance. The Secretary shall forward a copy of each such
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1 report to the Committees on Armed Services of the Senate

2 and House of Representatives.

3 ‘‘(c) COMPTROLLER GENERAL AUTHORITY.—(1) Ex4 cept as provided in paragraph (2), each contract awarded

5 after using procedures other than sealed bid procedures

6 shall provide that the Comptroller General and his rep7 resentatives are entitled to examine any records of the

8 contractor, or any of its subcontractors, that directly per9 tain to, and involve transactions relating to, the contract

10 or subcontract.

11 ‘‘(2) Paragraph (1) does not apply to a contract or

12 subcontract with a foreign contractor or foreign sub13 contractor if the head of the agency concerned determines,

14 with the concurrence of the Comptroller General or his

15 designee, that the application of that paragraph to the

16 contract or subcontract would not be in the public interest.

17 However, the concurrence of the Comptroller General or

18 his designee is not required—

19 ‘‘(A) where the contractor or subcontractor is a

20 foreign government or agency thereof or is precluded

21 by the laws of the country involved from making its

22 records available for examination; and

23 ‘‘(B) where the head of the agency determines,

24 after taking into account the price and availability of

25 the property and services from United States
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1 sources, that the public interest would be best served

2 by not applying paragraph (1).

3 ‘‘(d) LIMITATION.—The right of the head of an agen4 cy under subsection (a), and the right of the Comptroller

5 General under subsection (c), with respect to a contract

6 or subcontract shall expire three years after final payment

7 under such contract or subcontract.

8 ‘‘(e) INAPPLICABILITY TO CERTAIN CONTRACTS.—

9 This section is inapplicable with respect to the following

10 contracts:

11 ‘‘(1) Contracts for utility services at rates not

12 exceeding those established to apply uniformly to the

13 public, plus any applicable reasonable connection

14 charge.

15 ‘‘(f) RECORDS DEFINED.—In this section, the term

16 ‘records’ includes books, documents, accounting proce17 dures and practices, and other data, regardless of type and

18 regardless of whether such items are in written form, in

19 the form of computer data, or in any other form.’’.

20 (2) CLERICAL AMENDMENT.—The item relating

21 to such section in the table of sections at the begin22 ning of chapter 137 of title 10, United States Code,

23 is amended to read as follows:

‘‘2313. Examination of records of contractor.’’.

24 (b) REPEAL OF SUPERSEDED PROVISION.—
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1 (1) REPEAL.—Section 2406 of title 10, United

2 States Code, is repealed.

3 (2) CLERICAL AMENDMENT.—The table of sec4 tions at the beginning of chapter 141 of such title

5 is amended by striking out the item relating to sec6 tion 2406.

7 PART II—CIVILIAN AGENCY ACQUISITIONS

8 SEC. 2251. AUTHORITY TO EXAMINE RECORDS OF CON9 TRACTORS.

10 (a) AUTHORITY.—

11 (1) IN GENERAL.—Title III of the Federal

12 Property and Administrative Services Act of 1949

13 (41 U.S.C. 251 et seq.), as amended by section

14 1251(a), is further amended by inserting after sec15 tion 304A the following new section:

16 ‘‘EXAMINATION OF RECORDS OF CONTRACTOR

17 ‘‘SEC. 304B. (a) AGENCY AUTHORITY.—The head of

18 an executive agency, acting through an authorized rep19 resentative—

20 ‘‘(1) is entitled to inspect the plant and audit

21 the records of—

22 ‘‘(A) a contractor performing a cost-reim23 bursement, incentive, time-and-materials, labor24 hour, or price-redeterminable contract, or any

25 combination of such contracts, made by that ex26 ecutive agency under this title; and
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1 ‘‘(B) a subcontractor performing any sub2 contract under such a contract or combination

3 of contracts; and

4 ‘‘(2) shall, for the purpose of evaluating the ac5 curacy, completeness, and currency of cost or pricing

6 data required to be submitted pursuant to section

7 304A with respect to a contract or subcontract, have

8 the right to examine all records of the contractor or

9 subcontractor related to—

10 ‘‘(A) the proposal for the contract or sub11 contract;

12 ‘‘(B) the discussions conducted on the pro13 posal;

14 ‘‘(C) pricing of the contract or subcontract;

15 or

16 ‘‘(D) performance of the contract or sub17 contract.

18 ‘‘(b) SUBPOENA POWER.—(1) The agency head may

19 require by subpoena the production of records of a con20 tractor, access to which is provided by subsection (a).

21 ‘‘(2) Any such subpoena, in the case of contumacy

22 or refusal to obey, shall be enforceable by order of an ap23 propriate United States district court.

24 ‘‘(3) The authority provided by paragraph (1) may

25 not be delegated.
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1 ‘‘(4) In the year following a year in which the head

2 of an executive agency exercises the authority provided in

3 paragraph (1), the agency head shall submit to the Com4 mittee on Governmental Affairs of the Senate and the

5 Committee on Government Operations of the House of

6 Representatives a report on the exercise of such authority

7 during such preceding year and the reasons why such au8 thority was exercised in any instance.

9 ‘‘(c) COMPTROLLER GENERAL AUTHORITY.—(1) Ex10 cept as provided in paragraph (2), each contract awarded

11 after using procedures other than sealed bid procedures

12 shall provide that the Comptroller General and his rep13 resentatives are entitled to examine any records of the

14 contractor, or any of its subcontractors, that directly per15 tain to, and involve transactions relating to, the contract

16 or subcontract.

17 ‘‘(2) Paragraph (1) does not apply to a contract or

18 subcontract with a foreign contractor or foreign sub19 contractor if the agency head concerned determines, with

20 the concurrence of the Comptroller General or his des21 ignee, that the application of that paragraph to the con22 tract or subcontract would not be in the public interest.

23 However, the concurrence of the Comptroller General or

24 his designee is not required—
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1 ‘‘(A) where the contractor or subcontractor is a

2 foreign government or agency thereof or is precluded

3 by the laws of the country involved from making its

4 records available for examination; and

5 ‘‘(B) where the agency head determines, after

6 taking into account the price and availability of the

7 property and services from United States sources,

8 that the public interest would be best served by not

9 applying paragraph (1).

10 ‘‘(d) LIMITATION.—The right of an agency head

11 under subsection (a), and the right of the Comptroller

12 General under subsection (c), with respect to a contract

13 or subcontract shall expire three years after final payment

14 under such contract or subcontract.

15 ‘‘(e) INAPPLICABILITY TO CERTAIN CONTRACTS.—

16 This section is inapplicable with respect to the following

17 contracts:

18 ‘‘(1) Contracts for utility services at rates not

19 exceeding those established to apply uniformly to the

20 public, plus any applicable reasonable connection

21 charge.

22 ‘‘(f) RECORDS DEFINED.—In this section, the term

23 ‘records’ includes books, documents, accounting proce24 dures and practices, and other data, regardless of type and
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1 regardless of whether such items are in written form, in

2 the form of computer data, or in any other form.’’.

3 (2) CLERICAL AMENDMENT.—The table of con4 tents in the first section of such Act, as amended by

5 section 1251(b), is further amended by inserting

6 after the item relating to section 304A the following:

‘‘Sec. 304B. Examination of records of contractor.’’.

7 (b) REPEAL OF SUPERSEDED PROVISION.—Section

8 304 of the Federal Property and Administrative Services

9 Act of 1949 (41 U.S.C. 254) is amended by striking out

10 subsection (c).

11 Subtitle D—Cost Accounting

12 Standards

13 SEC. 2301. REPEAL OF OBSOLETE DEADLINE REGARDING

14 PROCEDURAL REGULATIONS FOR THE COST

15 ACCOUNTING STANDARDS BOARD.

16 Section 26(f)(3) of the Office of Federal Procurement

17 Policy Act (41 U.S.C. 422(f)(3)) is amended in the first

18 sentence by striking out ‘‘Not later than 180 days after

19 the date of the enactment of this section, the Adminis20 trator’’ and inserting in lieu thereof ‘‘The Administrator’’.
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1 Subtitle E—Administration of Con2 tract Provisions Relating to

3 Price, Delivery, and Product

4 Quality

5 PART I—ARMED SERVICES ACQUISITIONS

6 SEC. 2401. PROCUREMENT OF CRITICAL AIRCRAFT AND

7 SHIP SPARE PARTS; QUALITY CONTROL.

8 (a) REPEAL.—Section 2383 of title 10, United States

9 Code, is repealed.

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

11 at the beginning of chapter 141 of such title is amended

12 by striking out the item relating to section 2383.

13 SEC. 2402. CONTRACTOR GUARANTEES REGARDING WEAP14 ON SYSTEMS.

15 Section 2403(h) of title 10, United States Code, is

16 amended—

17 (1) by redesignating paragraph (2) as para18 graph (3); and

19 (2) by inserting after paragraph (1) the follow20 ing new paragraph (2):

21 ‘‘(2) The regulations shall include the following:

22 ‘‘(A) Guidelines for negotiating contractor guar23 antees that are reasonable and cost effective, as de24 termined on the basis of the likelihood of defects and

25 the estimated cost of correcting such defects.
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1 ‘‘(B) Procedures for administering contractor

2 guarantees.

3 ‘‘(C) Guidelines for determining the cases in

4 which it may be appropriate to waive the require5 ments of this section.’’.

6 SEC. 2403. REPEAL OF REQUIREMENT FOR COMPLETE DE7 LIVERY OF SUBSISTENCE SUPPLIES AT SPE8 CIFIC PLACE UPON INSPECTION.

9 (a) ARMY CONTRACTS.—

10 (1) REPEAL.—Section 4534 of title 10, United

11 States Code, is repealed.

12 (2) CLERICAL AMENDMENT.—The table of sec13 tions at the beginning of chapter 433 of such title

14 is amended by striking out the item relating to sec15 tion 4534.

16 (b) AIR FORCE CONTRACTS.—

17 (1) REPEAL.—Section 9534 of title 10, United

18 States Code, is repealed.

19 (2) CLERICAL AMENDMENT.—The table of sec20 tions at the beginning of chapter 933 of such title

21 is amended by striking out the item relating to sec22 tion 9534.
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1 PART II—ACQUISITIONS GENERALLY

2 SEC. 2451. SECTION 3737 OF THE REVISED STATUTES: EX3 PANSION OF AUTHORITY TO PROHIBIT

4 SETOFFS AGAINST ASSIGNEES; REORGANIZA5 TION OF SECTION; REVISION OF OBSOLETE

6 PROVISIONS.

7 Section 3737 of the Revised Statutes (41 U.S.C. 15)

8 is amended to read as follows:

9 ‘‘SEC. 3737. (a) No contract or order, or any interest

10 therein, shall be transferred by the party to whom such

11 contract or order is given to any other party, and any such

12 transfer shall cause the annulment of the contract or order

13 transferred, so far as the United States is concerned. All

14 rights of action, however, for any breach of such contract

15 by the contracting parties, are reserved to the United

16 States.

17 ‘‘(b) The provisions of subsection (a) shall not apply

18 in any case in which the moneys due or to become due

19 from the United States or from any agency or department

20 thereof, under a contract providing for payments aggre21 gating $1,000 or more, are assigned to a bank, trust com22 pany, or other financing institution, including any Federal

23 lending agency, provided:

24 ‘‘(1) That, in the case of any contract entered

25 into after October 9, 1940, no claim shall be as-
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1 signed if it arises under a contract which forbids

2 such assignment;

3 ‘‘(2) That, unless otherwise expressly permitted

4 by such contract, any such assignment shall cover all

5 amounts payable under such contract and not al6 ready paid, shall not be made to more than one

7 party, and shall not be subject to further assign8 ment, except that any such assignment may be made

9 to one party as agent or trustee for two or more

10 parties participating in such financing;

11 ‘‘(3) That, in the event of any such assignment,

12 the assignee thereof shall file written notice of the

13 assignment together with a true copy of the instru14 ment of the assignment with—

15 ‘‘(A) the contracting officer or the head of

16 his department or agency;

17 ‘‘(B) the surety or sureties upon the bond

18 or bonds, if any, in connection with such con19 tract; and

20 ‘‘(C) the disbursing officer, if any, des21 ignated in such contract to make payment.

22 ‘‘(c) Notwithstanding any law to the contrary govern23 ing the validity of assignments, any assignment pursuant

24 to this section shall constitute a valid assignment for all

25 purposes.
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1 ‘‘(d) In any case in which moneys due or to become

2 due under any contract are or have been assigned pursu3 ant to this section, no liability of any nature of the as4 signor to the United States or any department or agency

5 thereof, whether arising from or independently of such

6 contract, shall create or impose any liability on the part

7 of the assignee to make restitution, refund, or repayment

8 to the United States of any amount heretofore since July

9 1, 1950, or hereafter received under the assignment.

10 ‘‘(e) Any contract of the Department of Defense, the

11 General Services Administration, the Department of En12 ergy, or any other department or agency of the United

13 States designated by the President, except any such con14 tract under which full payment has been made, may, upon

15 a determination of need by the President, provide or be

16 amended without consideration to provide that payments

17 to be made to the assignee of any moneys due or to become

18 due under such contract shall not be subject to reduction

19 or setoff.

20 ‘‘(f) If a provision described in subsection (e) or a

21 provision to the same general effect has been at any time

22 heretofore or is hereafter included or inserted in any such

23 contract, payments to be made thereafter to an assignee

24 of any moneys due or to become due under such contract

25 shall not be subject to reduction or setoff for any liability
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1 of any nature of the assignor to the United States or any

2 department or agency thereof which arises independently

3 of such contract, or hereafter for any liability of the as4 signor on account of—

5 ‘‘(1) renegotiation under any renegotiation stat6 ute or under any statutory renegotiation article in

7 the contract;

8 ‘‘(2) fines;

9 ‘‘(3) penalties (which term does not include

10 amounts which may be collected or withheld from

11 the assignor in accordance with or for failure to

12 comply with the terms of the contract); or

13 ‘‘(4) taxes, social security contributions, or the

14 withholding or non withholding of taxes or social se15 curity contributions, whether arising from or inde16 pendently of such contract.

17 ‘‘(g) Except as herein otherwise provided, nothing in

18 this section shall be deemed to affect or impair rights of

19 obligations heretofore accrued.’’.

20 SEC. 2452. REPEAL OF REQUIREMENT FOR DEPOSIT OF

21 CONTRACTS WITH GAO.

22 Section 3743 of the Revised Statutes (41 U.S.C. 20)

23 is repealed.
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1 Subtitle F—Claims and Disputes

2 PART I—ARMED SERVICES ACQUISITIONS

3 SEC. 2501. CERTIFICATION OF CONTRACT CLAIMS.

4 (a) DOD CERTIFICATION REQUIREMENT IN CON5 FLICT WITH GOVERNMENT-WIDE REQUIREMENT.—

6 (1) REPEAL.—Section 2410 of title 10, United

7 States Code, is repealed.

8 (2) CLERICAL AMENDMENT.—The table of sec9 tions at the beginning of chapter 141 of such title

10 is amended by striking out the item relating to sec11 tion 2410.

12 (b) REPEAL OF SUPERSEDED PROVISION.—Section

13 813(b) of the National Defense Authorization Act for Fis14 cal Year 1993 (Public Law 102–484; 106 Stat. 2453), is

15 repealed.

16 (c) RESTRICTION ON LEGISLATIVE PAYMENT OF

17 CLAIMS.—Section 2310e of title 10, United States Code,

18 is amended by adding at the end the following new sub19 section:

20 ‘‘(d) RESTRICTION ON LEGISLATIVE PAYMENT OF

21 CLAIMS.—In the case of a contract of an agency named

22 in section 2303(a) of this title, no provision of a law en23 acted after September 30, 1993, that directs the payment

24 of a particular claim under such contract, a particular re25 quest for equitable adjustment to any term of such con-
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1 tract, or a particular request for relief under Public Law

2 85–804 (50 U.S.C. 1431 et seq.) regarding such contract

3 may be implemented unless such provision of law—

4 ‘‘(1) specifically refers to this subsection; and

5 ‘‘(2) specifically states that this subsection does

6 not apply with respect to the payment directed by

7 that provision of law.’’.

8 PART II—ACQUISITIONS GENERALLY

9 SEC. 2551. CONCURRENT JURISDICTION OF UNITED

10 STATES DISTRICT COURTS UNDER THE LIT11 TLE TUCKER ACT.

12 Subsection (a) of section 1346 of title 28, United

13 States Code, is amended to read as follows:

14 ‘‘(a)(1) The district courts shall have original juris15 diction, concurrent with the United States Court of Fed16 eral Claims, of any civil action against the United States

17 for the recovery of any internal-revenue tax alleged to have

18 been erroneously or illegally assessed or collected, or any

19 penalty claimed to have been collected without authority

20 or any sum alleged to have been excessive or in any man21 ner wrongfully collected under the internal-revenue laws.

22 ‘‘(2)(A) Except as provided in subparagraph (B), the

23 district courts shall have original jurisdiction, concurrent

24 with the United States Court of Federal Claims, of any

25 other civil action or claim against the United States, not
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1 exceeding $10,000 in amount, founded either upon the

2 Constitution, or any Act of Congress, or any regulation

3 of an executive department, or upon any express or im4 plied contract with the United States, or for liquidated or

5 unliquidated damages in cases not sounding in tort.

6 ‘‘(B) The district courts shall not have jurisdiction

7 over any civil action or claim against the United States

8 which relates in any manner to a contract to which the

9 Contract Disputes Act of 1978 (41 U.S.C. 601 et seq.)

10 applies, including a claim that seeks to establish the exist11 ence or nonexistence of such a contract, seeks to establish

12 that such a contract is void, or seeks to determine and

13 construe the terms of such a contract. The district courts

14 do not have jurisdiction over any civil action or claim de15 scribed in the preceding sentence pursuant to section 1331

16 or 1334 of this title or any other provision of law.’’.

17 SEC. 2552. CONTRACT DISPUTES ACT IMPROVEMENTS.

18 (a) PERIOD FOR FILING CLAIMS.—Section 6 of the

19 Contract Disputes Act of 1978 (41 U.S.C. 605) is amend20 ed in subsection (a) by inserting after the second sentence

21 the following: ‘‘Each claim by a contractor against the

22 government relating to a contract and each claim by the

23 government against a contractor relating to a contract

24 shall be submitted within 6 years after the occurrence of

25 the event or events giving rise to the claim.’’.
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1 (b) INCREASED THRESHOLD FOR CERTIFICATION,

2 DECISION, AND NOTIFICATION REQUIREMENTS.—Sub3 section (c) of such section is amended by striking out

4 ‘‘$50,000’’ each place it appears and inserting in lieu

5 thereof ‘‘$100,000’’.

6 (c) INCREASED MAXIMUM FOR APPLICABILITY OF

7 SMALL CLAIMS PROCEDURE.—Section 9(a) of the Con8 tract Disputes Act of 1978 (41 U.S.C. 608(a)) is amended

9 by striking out ‘‘$10,000’’ in the first sentence and insert10 ing in lieu thereof ‘‘$25,000’’.

11 (d) REDUCED PERIOD FOR FILING ACTION IN

12 COURT OF FEDERAL CLAIMS.—Section 10(a)(3) of such

13 Act (41 U.S.C. 609(a)(3)) is amended by striking out

14 ‘‘twelve months’’ and inserting in lieu thereof ‘‘90 days’’.

15 (e) CLAIM DEFINED.—Section 2 of such Act (41

16 U.S.C. 601) is amended—

17 (1) by striking out ‘‘and’’ at the end of para18 graph (6);

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

20 paragraph (7) and inserting in lieu thereof ‘‘; and’’;

21 and

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

23 paragraph:

24 ‘‘(8) the term ‘claim’ includes a request for eq25 uitable adjustment to contact terms and a request
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1 for relief under Public Law 85–804 (50 U.S.C. 1431

2 et seq.).’’.

3 TITLE III—SERVICE SPECIFIC

4 AND MAJOR SYSTEMS STATUTES

5 Subtitle A—Major Systems Statutes

6 SEC. 3001. REQUIREMENT FOR INDEPENDENT COST ESTI7 MATES AND MANPOWER ESTIMATES BEFORE

8 DEVELOPMENT OR PRODUCTION.

9 (a) CONTENT AND SUBMISSION OF ESTIMATES.—

10 Section 2434 of title 10, United States Code, is amended

11 by striking out subsection (b) and inserting in lieu thereof

12 the following:

13 ‘‘(b) REGULATIONS.—The Secretary of Defense shall

14 promulgate regulations governing the content and submis15 sion of the estimates required by subsection (a). The regu16 lations shall require—

17 ‘‘(1) that the independent estimate of the cost

18 of a program—

19 ‘‘(A) be prepared by an office or other en20 tity that is not under the supervision, direction,

21 or control of the military department, Defense

22 Agency, or other component of the Department

23 of Defense that is directly responsible for carry24 ing out the development or acquisition of the

25 program; and
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1 ‘‘(B) include all costs of development, pro2 curement, and operations and support, without

3 regard to funding source or management con4 trol; and

5 ‘‘(2) that the manpower estimate include the

6 total personnel required to operate, maintain, and

7 support the program upon full operational deploy8 ment.’’.

9 (b) TERMINOLOGY CORRECTION.—Subsection (a) of

10 such section is amended by striking out ‘‘full-scale engi11 neering development’’ and inserting in lieu thereof ‘‘engi12 neering and manufacturing development’’.

13 SEC. 3002. ENHANCED PROGRAM STABILITY.

14 (a) BASELINE DESCRIPTIONS AND DEVIATION RE15 PORTING.—Section 2435 of title 10, United States Code,

16 is amended—

17 (1) in subsection (a)—

18 (A) by striking out paragraph (2); and

19 (B) in paragraph (1)—

20 (i) by striking out ‘‘(1)’’; and

21 (ii) by redesignating subparagraphs

22 (A) and (B) as paragraphs (1) and (2), re23 spectively; and

24 (2) by striking out subsection (b) and inserting

25 in lieu thereof the following:
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1 ‘‘(b) REGULATIONS.—The Secretary of Defense shall

2 promulgate regulations governing—

3 ‘‘(1) the content of baseline descriptions;

4 ‘‘(2) the submission of reports on deviations of

5 a program from the baseline description by the pro6 gram manager to the Secretary of the military de7 partment concerned and the Under Secretary of De8 fense for Acquisition;

9 ‘‘(3) procedures for review of deviation reports

10 within the Department of Defense; and

11 ‘‘(4) procedures for submission and approval of

12 revised baseline descriptions.’’.

13 (b) TERMINOLOGY CORRECTION.—Subsection (a)(1)

14 of such section, as redesignated by subsection

15 (a)(1)(B)(ii), is amended by striking out ‘‘full-scale engi16 neering development’’ and inserting in lieu thereof ‘‘engi17 neering and manufacturing development’’.

18 SEC. 3003. REPEAL OF REQUIREMENT FOR DEFENSE EN19 TERPRISE PROGRAMS.

20 (a) AUTHORITY.—

21 (1) REPEAL.—Sections 2436 and 2437 of title

22 10, United States Code, are repealed.

23 (2) CLERICAL AMENDMENT.—The table of sec24 tions at the beginning of chapter 144 of such title
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1 is amended by striking out the items relating to sec2 tions 2436 and 2437.

3 (b) CONFORMING AMENDMENT.—Section 809 of the

4 National Defense Authorization Act for Fiscal Year 1991

5 (Public Law 101–510; 10 U.S.C. 2430 note) is amend6 ed—

7 (1) by striking out subsection (d); and

8 (2) by redesignating subsections (e), (f), (g),

9 and (h) as subsections (d), (e), (f), and (g), respec10 tively.

11 SEC. 3004. REPEAL OF REQUIREMENT FOR COMPETITIVE

12 PROTOTYPING IN MAJOR PROGRAMS.

13 (a) REPEAL.—Section 2438 of title 10, United States

14 Code, is repealed.

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

16 at the beginning of chapter 144 of such title is amended

17 by striking out the item relating to section 2438.

18 SEC. 3005. REPEAL OF REQUIREMENT FOR COMPETITIVE

19 ALTERNATIVE SOURCES IN MAJOR PRO20 GRAMS.

21 (a) REPEAL.—Section 2439 of title 10, United States

22 Code, is repealed.

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

24 at the beginning of chapter 144 of such title is amended

25 by striking out the item relating to section 2439.
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1 Subtitle B—Testing Statutes

2 SEC. 3011. REPEAL OF TESTING REQUIREMENT FOR

3 WHEELED OR TRACKED VEHICLES.

4 (a) REPEAL.—Section 2362 of title 10, United States

5 Code, is repealed.

6 (b) TECHNICAL AMENDMENT.—The table of sections

7 at the beginning of chapter 139 of such title is amended

8 by striking out the item relating to section 2362.

9 SEC. 3012. MAJOR SYSTEMS AND MUNITIONS PROGRAMS:

10 SURVIVABILITY AND LETHALITY TESTING.

11 (a) SUBSTITUTION OF VULNERABILITY TESTING FOR

12 SURVIVABILITY TESTING.—Section 2366 of title 10,

13 United States Code, is amended—

14 (1) by striking out ‘‘survivability’’ each place it

15 appears in subsections (a)(1)(A), (a)(2)(A), (c)(1),

16 (d), (e)(3), and (e)(6)(A) and inserting in lieu there17 of ‘‘vulnerability’’; and

18 (2) in subsection (b)(1), by striking out ‘‘Sur19 vivability’’ and inserting in lieu thereof ‘‘Vulner20 ability’’.

21 (b) LESS THAN FULL-UP TESTING AUTHORIZED.—

22 Section 2366(e)(3) of such title is amended by inserting

23 after ‘‘configured for combat,’’ the following: ‘‘or, if the

24 covered system is a high value system, by firing such mu25 nitions at components, subsystems, and subassemblies (or
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1 realistic replicas or surrogates) together with performing

2 design analyses, modeling and simulation, and analysis of

3 combat data,’’.

4 (c) WAIVER AUTHORITY AFTER FULL-SCALE DE5 VELOPMENT BEGINS.—Section 2366(c)(1) of such title is

6 amended in the first sentence by striking out ‘‘, before

7 the system enters full-scale development,’’.

8 (d) REFERENCE TO CONGRESSIONAL COMMIT9 TEES.—Section 2366(d) of such title is amended in the

10 first sentence by striking out ‘‘defense committees of Con11 gress (as defined in section 2362(e)(3) of this title)’’ and

12 inserting in lieu thereof ‘‘Committees on Armed Services

13 and on Appropriations of the Senate and House of Rep14 resentatives’’.

15 SEC. 3013. OPERATIONAL TEST AND EVALUATION OF DE16 FENSE ACQUISITION PROGRAMS.

17 Section 2399(b) of title 10, United States Code, is

18 amended—

19 (1) by redesignating paragraph (5) as para20 graph (6); and

21 (2) by inserting after paragraph (4) the follow22 ing new paragraph (5):

23 ‘‘(5)(A) The Secretary of Defense may, for a particu24 lar major defense acquisition program, prescribe and apply

25 different operational test and evaluation procedures than
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1 those provided under subsection (a) and paragraphs (1)

2 through (3) of this subsection if the Secretary first trans3 mits to Congress—

4 ‘‘(i) a certification that such testing would be

5 unreasonably expensive and impracticable, cause un6 warranted delay, or be unnecessary because of the

7 acquisition strategy for that system; and

8 ‘‘(ii) a description of the actions taken to en9 sure that the system will be operationally effective

10 and suitable when the system is introduced into the

11 field.

12 ‘‘(B) Alternative operational test and evaluation pro13 cedures prescribed pursuant to subparagraph (A) may not

14 be used to proceed with a major defense acquisition pro15 gram beyond low-rate initial production.’’.

16 SEC. 3014. LOW-RATE INITIAL PRODUCTION OF NEW SYS17 TEMS.

18 (a) EXCEPTION FOR STRATEGIC DEFENSE MISSILE

19 SYSTEMS.—Subsection (c) of section 2400 of title 10,

20 United States Code, is amended to read as follows—

21 (1) in paragraph (1), by striking out ‘‘and mili22 tary satellite programs’’ and inserting in lieu thereof

23 ‘‘, military satellite programs, and strategic defense

24 missile programs’’;
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1 (2) in paragraph (2), by striking out ‘‘and mili2 tary satellite program’’ and inserting in lieu thereof

3 ‘‘, military satellite program, and strategic defense

4 missile program’’; and

5 (3) by striking out the caption of such sub6 section and inserting in lieu thereof ‘‘LOW-RATE

7 INITIAL PRODUCTION OF NAVAL VESSEL, SAT8 ELLITE, AND STRATEGIC DEFENSE MISSILE PRO9 GRAMS.—’’.

10 (b) SUBMISSION OF TEST AND EVALUATION MASTER

11 PLAN.—Paragraph (2) of such section is amended by

12 striking out subparagraph (B) and inserting in lieu there13 of the following:

14 ‘‘(B) any test and evaluation master plan pre15 pared for that program;’’.

16 Subtitle C—Service Specific Laws

17 SEC. 3021. INDUSTRIAL MOBILIZATION.

18 (a) CONSOLIDATION AND REVISION OF AUTHOR19 ITY.—

20 (1) AUTHORITY.—Subtitle V of chapter 148 of

21 title 10, United States Code, is amended by adding

22 at the end the following new section:
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1 ‘‘§ 2538. Industrial mobilization: orders; priorities;

2 possession of manufacturing plants; vio3 lations

4 ‘‘(a) ORDERING AUTHORITY.—In time of war or

5 when war is imminent, the President, through the Sec6 retary of Defense or the Secretary of a military depart7 ment, may order from any person or organized manufac8 turing industry necessary products or materials of the

9 type usually produced or capable of being produced by

10 that person or industry.

11 ‘‘(b) COMPLIANCE WITH ORDER REQUIRED.—A per12 son or industry with whom an order is placed under sub13 section (a), or the responsible head thereof, shall comply

14 with that order and give it precedence over all orders not

15 placed under that subsection.

16 ‘‘(c) SEIZURE OF FACILITIES UPON NONCOMPLI17 ANCE.—In time of war or when war is imminent, the

18 President, through the Secretary of Defense or the Sec19 retary of a military department, may take immediate pos20 session of any plant that is equipped to manufacture, or

21 that in the opinion of the Secretary of Defense or the Sec22 retary of the military department concerned, is capable of

23 being readily transformed into a plant for manufacturing,

24 arms or ammunition, parts thereof, or necessary supplies

25 for the armed forces if the person or industry owning or
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1 operating the plant, or the responsible head thereof, re2 fuses—

3 ‘‘(1) to give precedence to the order as pre4 scribed in subsection (b);

5 ‘‘(2) to manufacture the kind, quantity, or qual6 ity of arms or ammunition, parts thereof, or nec7 essary supplies, as ordered by the Secretary; or

8 ‘‘(3) to furnish them at a reasonable price as

9 determined by the Secretary.

10 ‘‘(d) USE OF SEIZED FACILITY.—The President,

11 through the Secretary of Defense or the Secretary of a

12 military department, may manufacture products that are

13 needed in time of war or when war is imminent, in any

14 plant that is seized under subsection (c).

15 ‘‘(e) COMPENSATION REQUIRED.—Each person or in16 dustry from whom products or materials are ordered

17 under subsection (a) is entitled to fair and just compensa18 tion. Each person or industry whose plant is seized under

19 subsection (c) is entitled to a fair and just rental.

20 ‘‘(f) CRIMINAL PENALTY.—Whoever fails to comply

21 with this section shall be imprisoned for not more than

22 three years and fined not more than $50,000.’’.

23 (2) TECHNICAL AMENDMENT.—The table of

24 sections at the beginning of subchapter V of such
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1 chapter is amended by adding at the end the follow2 ing new item:

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

plants; violations.’’.

3 (b) REPEAL OF SUPERSEDED AUTHORITY.—

4 (1) ARMY AUTHORITY.—

5 (A) REPEAL.—Section 4501 of title 10,

6 United States Code, is repealed.

7 (B) CLERICAL AMENDMENT.—The table of

8 sections at the beginning of chapter 431 of such

9 title is amended by striking out the item relat10 ing to section 4501.

11 (2) AIR FORCE AUTHORITY.—

12 (A) REPEAL.—Section 9501 of title 10,

13 United States Code, is repealed.

14 (B) CLERICAL AMENDMENT.—The table of

15 sections at the beginning of subchapter I of

16 chapter 931 of such title is amended by striking

17 out the item relating to section 9501.

18 SEC. 3022. INDUSTRIAL MOBILIZATION: PLANTS; LISTS;

19 BOARD ON MOBILIZATION OF INDUSTRIES

20 ESSENTIAL FOR MILITARY PREPAREDNESS.

21 (a) CONSOLIDATION AND REVISION OF AUTHOR22 ITY.—

23 (1) AUTHORITY.—Subchapter V of chapter 148

24 of title 10, United States Code, as amended by sec-
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1 tion 3021(a)(1), is further amended by adding at

2 the end the following:

3 ‘‘§ 2539. Industrial mobilization: plants; lists; Board

4 on Mobilization of Industries Essential

5 for Military Preparedness

6 ‘‘(a) LISTS OF ARMS AND AMMUNITION PLANTS.—

7 The Secretary of Defense and the secretaries of the mili8 tary departments may each maintain a list of privately

9 owned plants in the United States, and the Territories,

10 Commonwealths, and possessions of the United States,

11 that are equipped to manufacture for the armed forces

12 arms or ammunition, or parts thereof, and may, when the

13 Secretary of Defense or the Secretary concerned deter14 mines it necessary, obtain complete information of the

15 kinds of those products manufactured or capable of being

16 manufactured by each of those plants, and of the equip17 ment and capacity of each of those plants.

18 ‘‘(b) LISTS OF PLANTS CONVERTIBLE TO ARMS AND

19 AMMUNITION FACTORIES.—The Secretary of Defense and

20 the secretaries of the military departments may each

21 maintain a list of privately owned plants in the United

22 States, and the Territories, Commonwealths, and posses23 sions of the United States, that are capable of being read24 ily transformed into factories for the manufacture of am25 munition for the armed forces and that have a capacity
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1 sufficient to warrant conversion into ammunition plants

2 in time of war or when war is imminent, and may, when

3 the Secretary of Defense or the Secretary concerned deter4 mines it necessary, obtain complete information as to the

5 equipment of each of those plants.

6 ‘‘(c) CONVERSION PLANS.—The Secretary of Defense

7 or the Secretary concerned may prepare comprehensive

8 plans for converting each plant listed pursuant to sub9 section (b) into a factory for the manufacture of ammuni10 tion or parts thereof.

11 ‘‘(d) BOARD ON MOBILIZATION OF INDUSTRIES ES12 SENTIAL FOR MILITARY PREPAREDNESS.—The President

13 may appoint a nonpartisan Board on Mobilization of In14 dustries Essential for Military Preparedness and may pro15 vide necessary clerical assistance to organize and coordi16 nate operations under this section and section 2538 of this

17 title.’’.

18 (2) CLERICAL AMENDMENT.—The table of sec19 tions at the beginning of subchapter V of such chap20 ter, as amended by section 3021(a)(2), is further

21 amended by adding at the end the following new

22 item:

‘‘2539. Industrial mobilization: plants; lists; Board on Mobilization of Industries

Essential for Military Preparedness.’’.

23 (b) REPEAL OF SUPERSEDED AUTHORITY.—

24 (1) ARMY AUTHORITY.—
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1 (A) REPEAL.—Section 4502 of title 10,

2 United States Code, is repealed.

3 (B) CLERICAL AMENDMENT.—The table of

4 sections at the beginning of chapter 431 of such

5 title is amended by striking out the item relat6 ing to section 4502.

7 (2) AIR FORCE AUTHORITY.—

8 (A) REPEAL.—Section 9502 of title 10,

9 United States Code, is repealed.

10 (B) CLERICAL AMENDMENT.—The table of

11 sections at the beginning of subchapter I of

12 chapter 931 of such title is amended by striking

13 out the item relating to section 9502.

14 SEC. 3023. PROCUREMENT FOR EXPERIMENTAL PURPOSES.

15 (a) CONSOLIDATION AND REVISION OF AUTHOR16 ITY.—

17 (1) AUTHORITY.—Chapter 139 of title 10,

18 United States Code, is amended by adding at the

19 end the following new section:

20 ‘‘§ 2373. Procurement for experimental purposes

21 ‘‘The Secretary of Defense and the secretaries of the

22 military departments may each buy ordnance, signal, and

23 chemical warfare supplies, including parts and accessories,

24 and designs thereof, that the Secretary of Defense or the

25 Secretary concerned considers necessary for experimental
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1 or test purposes in the development of the best supplies

2 that are needed for the national defense. Purchases under

3 this section may be made inside or outside the United

4 States by contract or otherwise. Chapter 137 of this title

5 applies when such purchases are made in quantity.’’.

6 (2) CLERICAL AMENDMENT.—The table of sec7 tions at the beginning of such chapter is amended

8 by adding at the end the following new item:

‘‘2373. Procurement for experimental purposes.’’.

9 (b) REPEAL OF SUPERSEDED AUTHORITY.—

10 (1) ARMY AUTHORITY.—

11 (A) REPEAL.—Section 4504 of title 10,

12 United States Code, is repealed.

13 (B) CLERICAL AMENDMENT.—The table of

14 sections at the beginning of chapter 431 of such

15 title is amended by striking out the item relat16 ing to section 4504.

17 (2) AIR FORCE AUTHORITY.—

18 (A) REPEAL.—Section 9504 of title 10,

19 United States Code, is repealed.

20 (B) CLERICAL AMENDMENT.—The table of

21 sections at the beginning of subchapter I of

22 chapter 931 of such title is amended by striking

23 out the item relating to section 9504.
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1 SEC. 3024. REPEAL OF AUTHORITY FOR PROCUREMENT OF

2 PRODUCTION EQUIPMENT.

3 (a) ARMY AUTHORITY.—

4 (1) REPEAL.—Section 4505 of title 10, United

5 States Code, is repealed.

6 (2) CLERICAL AMENDMENT.—The table of sec7 tions at the beginning of chapter 431 of such title

8 is amended by striking out the item relating to sec9 tion 4505.

10 (b) AIR FORCE AUTHORITY.—

11 (1) REPEAL.—Section 9505 of title 10, United

12 States Code, is repealed.

13 (2) CLERICAL AMENDMENT.—The table of sec14 tions at the beginning of subchapter I of chapter

15 931 of such title is amended by striking out the item

16 relating to section 9505.

17 SEC. 3025. AVAILABILITY OF DEPARTMENT OF DEFENSE

18 SAMPLES, DRAWINGS, INFORMATION, EQUIP19 MENT, MATERIALS, AND CERTAIN SERVICES.

20 (a) CONSOLIDATION AND REVISION OF AUTHOR21 ITY.—

22 (1) AUTHORITY.—Subchapter V of chapter 148

23 of title 10, United States Code, as amended by sec24 tion 3022(a)(1), is further amended by adding at

25 the end the following:
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1 ‘‘§ 2540. Availability of samples, drawings, informa2 tion, equipment, materials, and certain

3 services

4 ‘‘(a) AUTHORITY.—The Secretary of Defense and the

5 secretaries of the military departments, under regulations

6 prescribed by the Secretary of Defense and when deter7 mined by the Secretary of Defense or the Secretary con8 cerned to be in the interest of national defense, may

9 each—

10 ‘‘(1) sell, lend, or give samples, drawings, and

11 manufacturing or other information (subject to the

12 rights of third parties) to any person or entity;

13 ‘‘(2) sell or lend government equipment or ma14 terials to any person or entity—

15 ‘‘(A) for use in independent research and

16 development programs, subject to the condition

17 that the equipment or material be used exclu18 sively for such research and development; or

19 ‘‘(B) for use in demonstrations to a friend20 ly foreign government; and

21 ‘‘(3) make available to any person or entity, at

22 an appropriate fee, the services of any government

23 laboratory, center, range, or other testing facility for

24 the testing of materials, equipment, models, com25 puter software, and other items.
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1 ‘‘(b) CONFIDENTIALITY OF TEST RESULTS.—The re2 sults of tests performed with services made available pur3 suant to subsection (a)(3) are confidential and may not

4 be disclosed outside the Federal Government without the

5 consent of the persons for whom the tests are performed.

6 ‘‘(c) FEES.—Fees for services made available for

7 testing under subsection (a)(3) shall be established in the

8 regulations prescribed pursuant to subsection (a). Such

9 fees may not be less than the direct costs involved, includ10 ing the direct costs of utilities, contractor support, and

11 salaries of personnel that are incurred by the United

12 States to provide for the testing.

13 ‘‘(d) USE OF COLLECTED FEES.—Fees received for

14 services made available pursuant to subsection (a)(3) may

15 be credited to the appropriations or other funds of the ac16 tivity providing such services.’’.

17 (2) CLERICAL AMENDMENT.—The table of sec18 tions at the beginning of subchapter V of such chap19 ter, as amended by section 3022(a)(2), is further

20 amended by adding at the end the following new

21 item:

‘‘2540. Availability of samples, drawings, information, equipment, materials, and

certain services.’’.

22 (b) CONFORMING AMENDMENTS.—

23 (1) EXEMPTION FROM ADVERTISING REQUIRE24 MENT.—Section 2314 of title 10, United States
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1 Code, is amended by inserting ‘‘or sale’’ after ‘‘pro2 curement’’.

3 (2) REPEAL OF SUPERSEDED ARMY AUTHOR4 ITY.—Chapter 431 of title 10, United States Code,

5 is amended—

6 (A) by striking out sections 4506, 4507,

7 and 4508; and

8 (B) in the table of sections at the begin9 ning of such chapter, by striking out the items

10 relating to such sections.

11 (3) REPEAL OF SUPERSEDED AIR FORCE AU12 THORITY.—Subchapter I of chapter 931 of title 10,

13 United States Code, is amended—

14 (A) by striking out sections 9506 and

15 9507; and

16 (B) in the table of sections at the begin17 ning of such subchapter, by striking out the

18 items relating to such sections.

19 SEC. 3026. REPEAL OF DUPLICATIVE GENERAL PROCURE20 MENT AUTHORITY.

21 (a) ARMY AUTHORITY.—

22 (1) REPEAL.—Section 4531 of title 10, United

23 States Code, is repealed.

24 (2) CLERICAL AMENDMENT.—The table of sec25 tions at the beginning of chapter 433 of such title
174

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1 is amended by striking out the item relating to sec2 tion 4531.

3 (b) AIR FORCE AUTHORITY.—

4 (1) REPEAL.—Section 9531 of title 10, United

5 States Code, is repealed.

6 (2) CLERICAL AMENDMENT.—The table of sec7 tions at the beginning of chapter 933 of such title

8 is amended by striking out the item relating to sec9 tion 9531.

10 SEC. 3027. REPEAL OF AUTHORITY TO DELEGATE THE PRO11 CUREMENT OF ARMY RATIONS.

12 (a) REPEAL.—Section 4533 of title 10, United States

13 Code, is repealed.

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

15 at the beginning of chapter 433 of such title is amended

16 by striking out the item relating to section 4533.

17 SEC. 3028. REPEAL OF AUTHORITY TO PURCHASE EXCEP18 TIONAL SUBSISTENCE SUPPLIES WITHOUT

19 ADVERTISING.

20 (a) ARMY AUTHORITY.—

21 (1) REPEAL.—Section 4535 of title 10, United

22 States Code, is repealed.

23 (2) CLERICAL AMENDMENT.—The table of sec24 tions at the beginning of chapter 433 of such title
175

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1 is amended by striking out the item relating to sec2 tion 4535.

3 (b) AIR FORCE AUTHORITY.—

4 (1) REPEAL.—Section 9535 of title 10, United

5 States Code, is repealed.

6 (2) CLERICAL AMENDMENT.—The table of sec7 tions at the beginning of chapter 933 of such title

8 is amended by striking out the item relating to sec9 tion 9535.

10 SEC. 3029. REPEAL OF AUTHORITY TO OBTAIN ASSISTANCE

11 OF UNITED STATES MAPPING AGENCIES.

12 (a) ARMY AUTHORITY.—

13 (1) REPEAL.—Section 4537 of title 10, United

14 States Code, is repealed.

15 (2) CLERICAL AMENDMENT.—The table of sec16 tions at the beginning of chapter 433 of such title

17 is amended by striking out the item relating to sec18 tion 4537.

19 (b) AIR FORCE AUTHORITY.—

20 (1) REPEAL.—Section 9537 of title 10, United

21 States Code, is repealed.

22 (2) CLERICAL AMENDMENT.—The table of sec23 tions at the beginning of chapter 933 of such title

24 is amended by striking out the item relating to sec25 tion 9537.
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1 SEC. 3030. REPEAL OF AUTHORITY TO RECLAIM UNSERV2 ICEABLE AMMUNITION.

3 (a) ARMY AUTHORITY.—

4 (1) REPEAL.—Section 4538 of title 10, United

5 States Code, is repealed.

6 (2) CLERICAL AMENDMENT.—The table of sec7 tions at the beginning of chapter 433 of such title

8 is amended by striking out the item relating to sec9 tion 4538.

10 (b) AIR FORCE AUTHORITY.—

11 (1) REPEAL.—Section 9538 of title 10, United

12 States Code, is repealed.

13 (2) CLERICAL AMENDMENT.—The table of sec14 tions at the beginning of chapter 933 of such title

15 is amended by striking out the item relating to sec16 tion 9538.

17 SEC. 3031. GRATUITOUS SERVICES OF OFFICERS OF CER18 TAIN RESERVE COMPONENTS.

19 (a) CONSOLIDATION AND REVISION OF AUTHOR20 ITY.—

21 (1) AUTHORITY.—Chapter 11 of title 10,

22 United States Code, is amended by inserting after

23 section 278 the following new section:
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1 ‘‘§ 279. Gratuitous services of officers of certain re2 serve components

3 ‘‘The Secretary of Defense and the secretaries of the

4 military departments may each accept the gratuitous serv5 ices of officers of the Army Reserve, Naval Reserve, Air

6 Force Reserve, and Marine Corps Reserve in the enrolling,

7 organizing, and training of members of such reserve com8 ponents or the Reserve Officers’ Training Corps, or in

9 consulting on matters relating to the armed forces.’’.

10 (2) CLERICAL AMENDMENT.—The table of sec11 tions at the beginning of chapter 11 of such title is

12 amended by inserting after the item relating to sec13 tion 278 the following new item:

‘‘Sec. 279. Gratuitous services of officers of certain reserve components.’’.

14 (b) REPEAL OF SUPERSEDED PROVISIONS.—

15 (1) ARMY AUTHORITY.—

16 (A) REPEAL.—Section 4541 of title 10,

17 United States Code, is repealed.

18 (B) CLERICAL AMENDMENT.—The table of

19 sections at the beginning of chapter 433 of such

20 title is amended by striking out the item relat21 ing to section 4541.

22 (2) AIR FORCE AUTHORITY.—

23 (A) REPEAL.—Section 9541 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 933 of such

3 title is amended by striking out the item relat4 ing to section 9541.

5 SEC. 3032. CIVIL RESERVE AIR FLEET.

6 (a) DEFINITION OF CONTRACTOR.—Section 9511(8)

7 of title 10, United States Code, is amended—

8 (1) by striking out ‘‘or’’ at the end of subpara9 graph (A); and

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

11 following: ‘‘, or (C) who owns or controls, or will

12 own or control, new or existing aircraft and who, by

13 contract, commits some or all of such aircraft to the

14 Civil Reserve Air Fleet’’.

15 (b) CONSOLIDATION OF PROVISIONS RELATING TO

16 CONTRACTUAL COMMITMENT OF AIRCRAFT.—Subchapter

17 II of chapter 931 of such title is amended—

18 (1) by redesignating subsections (b) and (c) of

19 section 9512 as subsections (c) and (d), respectively;

20 (2) by redesignating subsection (a) of section

21 9513 as subsection (b) and transferring such sub22 section (as so redesignated) to section 9512, and in23 serting such subsection after subsection (a);

24 (3) by redesignating subsection (b) of section

25 9513 as subsection (e) and transferring such sub-
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1 section (as so redesignated) to the end of section

2 9512;

3 (4) in subsection (c) of section 9512, as redes4 ignated by paragraph (1), by striking out ‘‘the terms

5 required by section 9513 of this title and’’;

6 (5) in subsection (e) of section 9512, as redes7 ignated and transferred to such section by para8 graph (3), by striking out ‘‘under section 9512 of

9 this title’’ and inserting in lieu thereof ‘‘entered into

10 under this section’’; and

11 (6) by striking out the heading of section 9513.

12 (c) USE OF MILITARY INSTALLATIONS BY CONTRAC13 TORS.—

14 (1) AUTHORITY.—Subchapter II of such chap15 ter, as amended by subsection (b), is further amend16 ed by adding at the end the following new section

17 9513:

18 ‘‘§ 9513. Use of military installations by Civil Reserve

19 Air Fleet contractors

20 ‘‘(a) CONTRACT AUTHORITY.—(1) The Secretary of

21 the Air Force—

22 ‘‘(A) may, by contract entered into with any

23 contractor, authorize such contractor to use one or

24 more Air Force installations designated by the Sec25 retary; and
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1 ‘‘(B) with the consent of the Secretary of an2 other military department, may, by contract entered

3 into with any contractor, authorize the contractor to

4 use one or more installations, designated by the Sec5 retary of the Air Force, that is under the jurisdic6 tion of the Secretary of such other military depart7 ment.

8 ‘‘(2) The Secretary of the Air Force may include in

9 the contract such terms and conditions as the Secretary

10 determines appropriate to promote the national defense or

11 to protect the interests of the United States.

12 ‘‘(b) PURPOSES OF USE.—A contract entered into

13 under subsection (a) may authorize use of a designated

14 installation as a weather alternate, a technical stop not

15 involving the enplaning or deplaning of passengers or

16 cargo, or, in the case of an installation within the United

17 States, for other commercial purposes. Notwithstanding

18 any other provision of the law, the Secretary may establish

19 different levels and types of uses for different installations

20 and may provide in contracts under subsection (a) for dif21 ferent levels and types of uses by different contractors.

22 ‘‘(c) DISPOSITION OF PAYMENTS FOR USE.—Not23 withstanding the provisions of section 1107(b) of the Fed24 eral Aviation Act of 1958 (49 U.S.C. 1507(b)), and any

25 other provision of law, amounts collected in a fiscal year
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1 from a contractor for services or supplies or as landing

2 fees or other charges authorized to be collected for use

3 of an installation under a contract entered into under sub4 section (a) shall be credited to an appropriation for such

5 fiscal year for the military department that has jurisdic6 tion over such installation.

7 ‘‘(d) HOLD HARMLESS REQUIREMENT.—A contract

8 entered into under subsection (a) shall provide that the

9 contractor agrees to indemnify and hold harmless the Air

10 Force (and any other armed force having jurisdiction over

11 any installation covered by the contract) from all actions,

12 suits, or claims of any sort resulting from, relating to, or

13 arising out of any activities conducted, or services or sup14 plies furnished, in connection with the contract.

15 ‘‘(e) RESERVATION OF RIGHT TO EXCLUDE CON16 TRACTOR.—A contract entered into under subsection (a)

17 shall provide that the Secretary concerned may, without

18 providing prior notice, deny access to an installation des19 ignated under the contract when the Secretary determines

20 that it is necessary to do so in order to meet military ex21 igencies.’’.

22 (2) CLERICAL AMENDMENT.—The table of sec23 tions at the beginning of subchapter II of such chap24 ter is amended by striking out the item relating to
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1 section 9513 and inserting in lieu thereof the follow2 ing:

‘‘9513. Use of military installations by Civil Reserve Air Fleet contractors.’’.

3 SEC. 3033. REPEAL OF NAVY AUTHORITY REGARDING RE4 SEARCH AND DEVELOPMENT, PROCURE5 MENT, AND CONSTRUCTION OF GUIDED MIS6 SILES.

7 (a) REPEAL OF OBSOLETE AUTHORITY.—Section

8 7201 of title 10, United States Code, is repealed.

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

10 at the beginning of chapter 631 of such title is amended

11 by striking out the item relating to section 7201.

12 SEC. 3034. EXCHANGE OF SCIENTIFIC PERSONNEL.

13 (a) EXCHANGE AUTHORITY.—Subchapter II of chap14 ter 138 of title 10, United States Code, is amended by

15 adding at the end the following new section:

16 ‘‘§ 2350j. Exchange of scientific personnel

17 ‘‘(a) INTERNATIONAL EXCHANGE AGREEMENTS AU18 THORIZED.—The Secretary of Defense is authorized to

19 enter into agreements with the governments of allies of

20 the United States and other friendly foreign countries for

21 the exchange of military and civilian scientific personnel

22 of the Department of Defense and military and civilian

23 scientific personnel of the defense ministries of such for24 eign governments.
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1 ‘‘(b) ASSIGNMENT OF PERSONNEL.—Pursuant to an

2 agreement entered into under subsection (a), personnel of

3 the defense ministry of a foreign government may be as4 signed to positions in the Department of Defense, and per5 sonnel of the Department of Defense may be assigned to

6 positions in the defense ministry of that foreign govern7 ment. An agreement for the exchange of personnel en8 gaged in research and development activities may provide

9 for assignment of such personnel to positions in private

10 industry that support the defense ministry of such foreign

11 government. A specific position and the individual to be

12 assigned to that position shall be acceptable to both gov13 ernments.

14 ‘‘(c) RECIPROCITY OF PERSONNEL QUALIFICATIONS

15 REQUIRED.—Each government shall be required under an

16 agreement authorized by subsection (a) to provide person17 nel having qualifications, training, and skills that are es18 sentially equal to those of the personnel provided by the

19 other government.

20 ‘‘(d) PAYMENT OF PERSONNEL COSTS.—Each gov21 ernment shall pay the salary, per diem, cost of living, trav22 el, cost of language or other training, and other costs (ex23 cept for cost of temporary duty directed by the host gov24 ernment and costs incident to the use of host government

25 facilities in the performance of assigned duties) for its own
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1 personnel in accordance with the laws and regulations of

2 such government that pertain to such matters.’’.

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

4 at the beginning of subchapter II of such chapter is

5 amended by adding at the end the following new item:

‘‘2350j. Exchange of scientific personnel.’’.

6 SEC. 3035. REPEAL OF AUTHORITY FOR SECRETARY OF

7 THE NAVY TO PROVIDE TEMPORARY RELIEF

8 FOR CONTRACTORS AND CONTRACTOR EM9 PLOYEES FROM LOSSES CAUSED BY ENEMY

10 ACTION.

11 (a) REPEAL.—Section 7213 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 7213.

16 SEC. 3036. REPEAL OF AUTHORITY FOR SECRETARY OF

17 THE NAVY TO SELL DEGAUSSING EQUIP18 MENT.

19 (a) REPEAL.—Section 7230 of title 10, United States

20 Code, is repealed.

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

22 at the beginning of chapter 631 of such title is amended

23 by striking out the item relating to section 7230.
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1 SEC. 3037. REPEAL OF AUTHORITY FOR ALTERNATIVE USE

2 OF APPROPRIATIONS FOR CONSTRUCTION

3 OR CONVERSION OF VESSELS.

4 (a) REPEAL.—Section 7296 of title 10, United States

5 Code, is repealed.

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

7 at the beginning of chapter 633 of such title is amended

8 by striking out the item relating to section 7296.

9 SEC. 3038. REPEAL OF AUTHORITY FOR CONVERSION OF

10 COMBATANT AND AUXILIARY NAVAL VES11 SELS.

12 (a) REPEAL.—Section 7298 of title 10, United States

13 Code, is repealed.

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

15 at the beginning of chapter 633 of such title is amended

16 by striking out the item relating to section 7298.

17 SEC. 3039. CONSTRUCTION OF COMBATANT AND ESCORT

18 VESSELS AND ASSIGNMENT OF VESSEL

19 PROJECTS.

20 (a) REPEAL OF OBSOLETE AND INTERNALLY INCON21 SISTENT PROVISIONS.—Section 7299a of title 10, United

22 States Code, is amended—

23 (1) by striking out subsection (a); and

24 (2) by redesignating subsections (b) and (c) as

25 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. 3040. REPEAL OF REQUIREMENT FOR ESTIMATES IN

6 CONNECTION WITH BIDS ON CONSTRUCTION

7 OF NAVAL VESSELS.

8 (a) REPEAL.—Section 7301 of title 10, United States

9 Code, is repealed.

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

11 at the beginning of chapter 633 of such title is amended

12 by striking out the item relating to section 7301.

13 SEC. 3041. REPEAL OF REQUIREMENT FOR CONSTRUCTION

14 OF VESSELS ON PACIFIC COAST.

15 (a) REPEAL.—Section 7302 of title 10, United States

16 Code, is repealed.

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

18 at the beginning of chapter 633 of such title is amended

19 by striking out the item relating to section 7302.

20 SEC. 3042. FITNESS OF NAVAL VESSELS: EXAMINATION;

21 STRIKING UNFIT VESSELS; DISPOSAL.

22 (a) CONSOLIDATION AND REVISION OF AUTHOR23 ITY.—

24 (1) AUTHORITY.—Section 7304 of title 10,

25 United States Code, is amended to read as follows:
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1 ‘‘§ 7304. Fitness of vessels: examination; striking from

2 Naval Vessel Register; disposal

3 ‘‘(a) TRIENNIAL EXAMINATION OF VESSELS RE4 QUIRED.—The Secretary of the Navy shall designate

5 boards of naval officers to examine all naval vessels, in6 cluding unfinished vessels. Each vessel shall be examined

7 at least once every three years if practicable.

8 ‘‘(b) BOARD RECOMMENDATIONS.—A board des9 ignated under subsection (a) shall recommend to the Sec10 retary of the Navy in writing which vessels, if any, should

11 be stricken from the Naval Vessel Register. In making

12 such recommendations, the board shall consider whether

13 a vessel is unfit for service or whether an unfinished vessel

14 cannot be finished without disproportionate expense.

15 ‘‘(c) ACTION OF THE SECRETARY.—If the Secretary

16 concurs with a board’s recommendation that a vessel be

17 stricken from the Naval Vessel Register, the Secretary

18 shall strike the name of that vessel from the Naval Vessel

19 Register.

20 ‘‘(d) APPRAISAL OF STRICKEN VESSEL.—The Sec21 retary of the Navy shall appraise each vessel stricken from

22 the Naval Vessel Register.

23 ‘‘(e) SALE OF STRICKEN VESSEL.—(1) When the

24 Secretary determines that it is in the national interest,

25 the Secretary may sell a vessel stricken from the Naval

26 Vessel Register.
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1 ‘‘(2) A vessel stricken from the Naval Vessel Register

2 and not subject to disposition under any other law, may

3 be sold at public sale to the highest acceptable bidder, re4 gardless of the vessel’s appraised value, after being adver5 tised for sale for a period of not less than 30 days.

6 ‘‘(3) If the Secretary determines that the bid prices

7 received after advertising are not reasonable and that

8 readvertising will serve no useful purpose, the vessel may

9 be sold by negotiation to the highest acceptable offeror,

10 but only if—

11 ‘‘(A) each responsible bidder has been notified

12 of the intent to negotiate a sale of the vessel and has

13 been given a reasonable opportunity to negotiate

14 with the Secretary for the purchase of that vessel;

15 and

16 ‘‘(B) the negotiated price—

17 ‘‘(i) is higher than the highest rejected

18 price of any responsible bidder; or

19 ‘‘(ii) is reasonable and is in the national

20 interest.

21 ‘‘(f) OTHER TRANSFERS.—(1) The Secretary of the

22 Navy is authorized to transfer, by gift or otherwise, any

23 vessel stricken from the Naval Vessel Register or any cap24 tured vessel to—
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1 ‘‘(A) any State, Commonwealth, or possession

2 of the United States, or to any municipal corpora3 tion or political subdivision thereof;

4 ‘‘(B) the District of Columbia; or

5 ‘‘(C) any not-for-profit or nonprofit entity.

6 ‘‘(2) A transfer under paragraph (1) shall be made

7 at no cost to the United States and may not be made un8 less the transferee agrees to maintain the vessel in a condi9 tion satisfactory to the Secretary of the Navy.

10 ‘‘(g) USE FOR EXPERIMENTAL PURPOSES.—The

11 Secretary of the Navy is authorized to use for experi12 mental purposes any vessel stricken from the Naval Vessel

13 Register. A vessel so used shall first be stripped to the

14 maximum extent practicable. The proceeds received from

15 stripping the vessel shall be credited to appropriations

16 available for the procurement of the scrapping services

17 needed for stripping of that vessel. Excess receipts shall

18 be deposited into the general fund of the Treasury.

19 ‘‘(h) INAPPLICABILITY OF OTHER LAW.—The provi20 sions of title II of the Federal Property and Administra21 tive Services Act of 1949 (40 U.S.C. 481 et seq.) do not

22 apply to the disposition of a naval vessel under this sec23 tion.

24 ‘‘(i) LIMITATION.—Notwithstanding any other provi25 sion of law, no battleship, aircraft carrier, cruiser, de-
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1 stroyer, or submarine of the Navy may be sold, trans2 ferred, or otherwise disposed of, unless the Chief of Naval

3 Operations certifies that it is not essential to the defense

4 of the United States.’’.

5 (2) CLERICAL AMENDMENT.—The item relating

6 to such section in the table of sections at the begin7 ning of chapter 633 of such title is amended to read

8 as follows:

‘‘7304. Fitness of vessels: examination; striking from Naval Vessel Register; disposal.’’.

9 (b) REPEAL OF SUPERSEDED PROVISIONS.—

10 (1) REPEAL.—Sections 7305, 7306, 7307, and

11 7308 of title 10, United States Code, are repealed.

12 (2) CLERICAL AMENDMENT.—The table of sec13 tions at the beginning of chapter 633 of such title

14 is amended by striking out the items relating to such

15 sections.

16 SEC. 3043. REPEAL OF POLICY ON CONSTRUCTING COM17 BATANT VESSELS.

18 (a) REPEAL.—Section 7310 of title 10, United States

19 Code, is repealed.

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

21 at the beginning of chapter 633 of such title is amended

22 by striking out the item relating to section 7310.
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1 SEC. 3044. NAVAL SALVAGE FACILITIES.

2 (a) CONSOLIDATION OF AUTHORITY.—Chapter 637

3 of title 10, United States Code, is amended—

4 (1) in section 7361—

5 (A) in subsection (a), by inserting ‘‘AU6 THORITY TO PROVIDE FACILITIES BY CON7 TRACT OR OTHERWISE.—’’ after ‘‘(a)’’;

8 (B) in subsection (b), by inserting ‘‘CON9 TRACTS AFFECTING THE DEPARTMENT OF

10 TRANSPORTATION.—’’ after ‘‘(b)’’; and

11 (C) in subsection (c)—

12 (i) by inserting ‘‘LIMITATION ON

13 TERM CONTRACTS.—’’ after ‘‘(c)’’; and

14 (ii) by striking out ‘‘under this sec15 tion’’ and inserting in lieu thereof ‘‘under

16 subsection (a)’’;

17 (2) by designating the text of section 7362 as

18 subsection (d) and transferring such text, as so des19 ignated, to the end of section 7361 of title 10,

20 United States Code;

21 (3) in subsection (d) of section 7361 of such

22 title, as so designated and transferred, by inserting

23 before ‘‘The Secretary’’ the following: ‘‘COMMERCIAL

24 USE OF NAVAL VESSELS AND EQUIPMENT.—’’;

25 (4) by designating the text of section 7363 as

26 subsection (e) and transferring such text, as so des-
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1 ignated, to the end of section 7361 of title 10,

2 United States Code;

3 (5) in subsection (e) of section 7361 of such

4 title, as so designated and transferred, by inserting

5 before ‘‘Before any salvage vessel’’ the following:

6 ‘‘CONDITIONS FOR TRANSFER OF EQUIPMENT.—’’;

7 (6) by designating the text of section 7365 as

8 subsection (f) and transferring such text, as so des9 ignated, to the end of section 7361 of title 10,

10 United States Code;

11 (7) in subsection (f) of section 7361 of such

12 title, as so designated and transferred, by inserting

13 before ‘‘The Secretary’’ the following: ‘‘SETTLE14 MENT OF CLAIMS.—’’;

15 (8) by designating the text of section 7366 as

16 subsection (g) and transferring such text, as so des17 ignated, to the end of section 7361 of title 10,

18 United States Code;

19 (9) in subsection (g) of section 7361 of such

20 title, as so designated and transferred—

21 (A) by inserting before ‘‘Not more than’’

22 the following: ‘‘LIMITATION ON APPROPRIA23 TIONS.—’’; and

24 (B) by striking out ‘‘this chapter’’ and in25 serting in lieu thereof ‘‘this section’’;
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1 (10) by designating the text of section 7367 as

2 subsection (h) and transferring such text, as so des3 ignated, to the end of section 7361 of title 10,

4 United States Code;

5 (11) in subsection (h) of section 7361 of such

6 title, as so designated and transferred—

7 (A) by inserting before ‘‘Money received’’

8 the following: ‘‘DISPOSITION OF RECEIPTS.—’’;

9 and

10 (B) by striking out ‘‘this chapter’’ in the

11 first sentence and inserting in lieu thereof ‘‘this

12 section’’;

13 (12) by striking out the section headings for

14 sections 7362, 7363, 7365, 7366, and 7367;

15 (13) by striking out the heading for section

16 7361 and inserting in lieu thereof the following:

17 ‘‘§ 7361. Navy support for salvage operations’’;

18 and

19 (14) in the table of sections at the beginning of

20 such chapter—

21 (A) by striking out the item relating to

22 section 7361 and inserting in lieu thereof the

23 following:

‘‘7361. Navy support for salvage operations.’’;

24 and
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1 (B) by striking out the items relating to

2 sections 7362, 7363, 7365, 7366, and 7367.

3 Subtitle D—Department of Defense

4 Commercial and Industrial Ac5 tivities

6 SEC. 3051. FACTORIES AND ARSENALS: MANUFACTURE AT.

7 (a) CONSOLIDATION AND REVISION OF AUTHOR8 ITY.—

9 (1) AUTHORITY.—Subchapter V of chapter 148

10 of title 10, United States Code, as amended by sec11 tion 3025(a)(1), is further amended by adding at

12 the end the following:

13 ‘‘§ 2541. Factories and arsenals: manufacture at

14 ‘‘(a) The Secretary of Defense or the Secretary of

15 a military department may have supplies needed for the

16 Department of Defense or such military department, as

17 the case may be, made in factories or arsenals owned by

18 the United States.

19 ‘‘(b) The Secretary of Defense or the Secretary of

20 the military department concerned may abolish any

21 United States arsenal that such Secretary considers un22 necessary.’’.

23 (2) TECHNICAL AMENDMENT.—The table of

24 sections at the beginning of subchapter V of such

25 chapter, as amended by section 3025(a)(2), is fur-
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1 ther amended by adding at the end the following

2 new item:

‘‘2541. Factories and arsenals: manufacture at.’’.

3 (b) REPEAL OF SUPERSEDED AUTHORITY.—

4 (1) ARMY AUTHORITY.—

5 (A) REPEAL.—Section 4532 of title 10,

6 United States Code, is repealed.

7 (B) CLERICAL AMENDMENT.—The table of

8 sections at the beginning of chapter 433 of such

9 title is amended by striking out the item relat10 ing to section 4532.

11 (2) AIR FORCE AUTHORITY.—

12 (A) REPEAL.—Section 9532 of title 10,

13 United States Code, is repealed.

14 (B) CLERICAL AMENDMENT.—The table of

15 sections at the beginning of chapter 933 of such

16 title is amended by striking out the item relat17 ing to section 9532.

18 SEC. 3052. 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 consulting serv25 ices for each department and agency as a separate object
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1 class in each budget annually submitted to the Congress

2 under this section.

3 ‘‘(2) For purposes of this subsection, consulting serv4 ices include—

5 ‘‘(A) management and professional support

6 services;

7 ‘‘(B) studies, analyses, and evaluations;

8 ‘‘(C) engineering and technical services (exclud9 ing routine engineering services such as automated

10 data processing and architect and engineering con11 tracts); and

12 ‘‘(D) research and development.’’.

13 (b) REPEAL OF SOURCE LAW.—Section 512 of Pub14 lic Law 102–394 (106 Stat. 1826) is repealed.

15 (c) REPEAL OF SUPERSEDED PROVISION.—

16 (1) DOD SPECIFIC LAW.—Section 2212 of title

17 10, United States Code, is repealed.

18 (2) CLERICAL AMENDMENT.—The table of sec19 tions at the beginning of chapter 131 of such title

20 is amended by striking out the item relating to sec21 tion 2212.
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1 Subtitle E—Fuel- and Energy2 Related Laws

3 SEC. 3061. LIQUID FUELS AND NATURAL GAS: CONTRACTS

4 FOR STORAGE, HANDLING, OR DISTRIBU5 TION.

6 (a) REVISION OF AUTHORITY.—Section 2388 of title

7 10, United States Code, is amended—

8 (1) by striking out subsections (a) and (b) and

9 inserting in lieu thereof the following:

10 ‘‘(a) AUTHORITY TO CONTRACT.—The Secretary of

11 Defense and the Secretary of a military department may

12 each contract for storage facilities for, or the storage, han13 dling, or distribution of, liquid fuels and natural gas.

14 ‘‘(b) PERIOD OF CONTRACT.—The period of a con15 tract entered into under subsection (a) may not exceed

16 5 years. However, the contract may provide options for

17 the Secretary to renew the contract for additional periods

18 of not more than 5 years each, but not for more than a

19 total of 20 years.’’; and

20 (2) in subsection (c), by inserting ‘‘OPTION TO

21 PURCHASE FACILITY.—’’ after ‘‘(c)’’.

22 (b) CLERICAL AMENDMENTS.—

23 (1) SECTION HEADING.—The heading of such

24 section is amended to read as follows:
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1 ‘‘§ 2388. Liquid fuels and natural gas: contracts for

2 storage, handling, or distribution’’.

3 (2) TABLE OF SECTIONS.—The item relating to

4 such section in the table of sections at the beginning

5 of chapter 141 of title 10, United States Code, is

6 amended to read as follows:

‘‘2388. Liquid fuels and natural gas: contracts for storage, handling, or distribution.’’.

7 SEC. 3062. ACQUISITION OF PETROLEUM AND NATURAL

8 GAS: AUTHORITY TO WAIVE PROCEDURES.

9 (a) ACQUISITION, SALE, AND EXCHANGE OF NATU10 RAL GAS.—Section 2404 of title 10, United States Code,

11 is amended—

12 (1) in subsection (a)—

13 (A) in the matter above paragraph (1), by

14 inserting ‘‘or natural gas’’ after ‘‘petroleum’’;

15 (B) in paragraph (1)—

16 (i) by inserting ‘‘or natural gas mar17 ket conditions, as the case may be,’’ after

18 ‘‘petroleum market conditions’’; and

19 (ii) by inserting ‘‘or acquisition of

20 natural gas, respectively,’’ after ‘‘acquisi21 tion of petroleum’’; and

22 (C) in paragraph (2), by inserting ‘‘or nat23 ural gas, as the case may be,’’ after ‘‘petro24 leum’’; and
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1 (2) in subsection (b), by inserting ‘‘or natural

2 gas’’ in the second sentence after ‘‘petroleum’’.

3 (b) EXPANSION OF EXCHANGE AUTHORITY.—Sub4 section (c) of such section is amended to read as follows:

5 ‘‘(c) EXCHANGE AUTHORITY.—The Secretary of De6 fense may acquire petroleum, petroleum-related services,

7 natural gas, or natural gas-related services by exchange

8 of petroleum, petroleum-related services, natural gas, or

9 natural gas-related services.’’.

10 (c) SALE OF PETROLEUM AND NATURAL GAS.—Such

11 section is amended—

12 (1) by redesignating subsection (d) as sub13 section (e); and

14 (2) by inserting after subsection (c) the follow15 ing new subsection (d):

16 ‘‘(d) AUTHORITY TO SELL.—The Secretary of De17 fense may sell petroleum or natural gas of the Department

18 of Defense if the Secretary determines that the sale would

19 be in the public interest. The proceeds of such a sale shall

20 be credited to appropriations of the Department of De21 fense for the fiscal year in which received and shall be

22 available for such fiscal year for the acquisition of petro23 leum, petroleum-related services, natural gas, or natural

24 gas-related services.’’.

25 (d) TECHNICAL AND CLERICAL AMENDMENTS.—
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1 (1) SUBSECTION CAPTIONS.—Section 2404 of

2 title 10, United States Code, is amended—

3 (A) in subsection (a), by inserting ‘‘WAIV4 ER AUTHORITY.—’’ after ‘‘(a)’’;

5 (B) in subsection (b), by inserting ‘‘SCOPE

6 OF WAIVER.—’’ after ‘‘(b)’’; and

7 (C) in subsection (e), as redesignated by

8 subsection (c)(1), by inserting ‘‘PETROLEUM

9 DEFINED.—’’ after ‘‘(e)’’.

10 (2) SECTION HEADING.—The heading of such

11 section is amended to read as follows:

12 ‘‘§ 2404. Acquisition of petroleum and natural gas: au13 thority to waive contract procedures; ac14 quisition by exchange; sales authority’’.

15 (3) TABLE OF SECTIONS.—The item relating to

16 such section in the table of sections at the beginning

17 of chapter 141 of title 10, United States Code, is

18 amended to read as follows:

‘‘2404. Acquisition of petroleum and natural gas: authority to waive contract

procedures; acquisition by exchange; sales authority.’’.
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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 PROVISIONS FOR THE ENCOURAGE20 MENT OF AVIATION.

21 (a) REPEAL.—Chapter 135 of title 10, United States

22 Code, is repealed.

23 (b) CLERICAL AMENDMENT.—The tables of chapters

24 at the beginning of subtitle A of such title and the begin-
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1 ning of part IV of such subtitle are amended by striking

2 out the item relating to chapter 135.

3 SEC. 3083. REPEAL OF REQUIREMENTS REGARDING PROD4 UCT EVALUATION ACTIVITIES.

5 (a) REPEAL.—Section 2369 of title 10, United States

6 Code, is repealed.

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

8 at the beginning of chapter 139 of such title is amended

9 by striking out the item related to section 2369.

10 SEC. 3084. REPEAL OF PRICE ADJUSTMENT AUTHORITY

11 AND PURCHASE AUTHORITY RELATING TO

12 THE PROCUREMENT OF MILK.

13 (a) REPEAL.—Section 2389 of title 10, United States

14 Code, is repealed.

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

16 at the beginning of chapter 141 of such title is amended

17 by striking out the item related to section 2389.

18 SEC. 3085. CODIFICATION AND REVISION OF LIMITATION

19 ON LEASE OF VESSELS, AIRCRAFT, AND VEHI20 CLES.

21 (a) LIMITATION.—

22 (1) IN GENERAL.—Chapter 141 of title 10,

23 United States Code, is amended by adding at the

24 end the following new section:
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1 ‘‘§ 2410e. Lease of vessels, aircraft, and vehicles

2 ‘‘The head of an agency named in paragraph (1), (2),

3 (3), or (4) of section 2303(a) of this title may not enter

4 into any contract with a term of 18 months or more, or

5 extend or renew any contract for a term of 18 months

6 or more, for any vessel, aircraft, or vehicle, through a

7 lease, charter, or similar agreement without previously

8 having considered all costs of such lease (including esti9 mated termination liability) and determined in writing

10 that such lease is in the best interest of the Government.’’.

11 (2) CLERICAL AMENDMENT.—The table of sec12 tions at the beginning of such chapter is amended

13 by adding at the end the following:

‘‘2410e. Leases of vessels, aircraft, and vehicles.’’.

14 (b) REPEAL OF SUPERSEDED PROVISION.—Section

15 9081 of Public Law 101–165 (103 Stat. 1147; 10 U.S.C.

16 2401 note) is repealed.
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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 1996, contracting activities shall continue to report pro17 curement awards with a dollar value of at least $25,000,

18 but less than $100,000, in conformity with the procedures

19 for 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) A proposed purchase or contract for an amount

9 above the simplified acquisition threshold may not be di10 vided into several purchases or contracts for lesser

11 amounts in order to use the simplified acquisition proce12 dures required by subsection (a).

13 ‘‘(c) In using simplified acquisition procedures, the

14 head of an executive agency shall promote competition to

15 the maximum extent practicable.’’.

16 SEC. 4012. SMALL BUSINESS RESERVATION.

17 Section 15(j) of the Small Business Act (15 U.S.C.

18 644(j)) is amended to read as follows:

19 ‘‘(j)(1) Each contract for the procurement of goods

20 and services that has an anticipated value not in excess

21 of the simplified acquisition threshold and that is subject

22 to simplified acquisition procedures prescribed pursuant to

23 section 29 of the Office of Federal Procurement Policy

24 Act shall be reserved exclusively for small business con25 cerns unless the contracting officer is unable to obtain of-
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1 fers from two or more small business concerns that are

2 competitive with market prices and are competitive with

3 regard to the quality and delivery of the goods or services

4 being procured.

5 ‘‘(2) In carrying out paragraph (1), a contracting of6 ficer shall consider a responsive offer timely received from

7 an eligible small business offeror.

8 ‘‘(3) Nothing in paragraph (1) shall be construed as

9 precluding an award of a contract with a value not in ex10 cess of the simplified acquisition threshold under the au11 thority of section 8(a) of this Act, section 2323 of title

12 10, United States Code, or section 712 of the Business

13 Opportunity Development Reform Act of 1988 (Public

14 Law 100–656; 15 U.S.C. 644 note).

15 ‘‘(4) In utilizing procedures referred to in paragraph

16 (1), contracting officers shall, wherever circumstances per17 mit, provide for the use of fast payment terms and dis18 bursement of payment through electronic fund transfer.’’.

19 SEC. 4013. PROCUREMENT NOTICE.

20 (a) CONTINUATION OF EXISTING NOTICE THRESH21 OLDS.—Subsection (a) of section 18 of the Office of Fed22 eral Procurement Policy Act (41 U.S.C. 416) is amend23 ed—
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1 (1) in paragraph (1), by striking out ‘‘the small

2 purchase threshold’’ each place it appears and in3 serting in lieu thereof ‘‘$25,000’’; and

4 (2) in paragraph (3)(B), by inserting after

5 ‘‘(B)’’ the following: ‘‘in the case of a contract or

6 order expected to exceed the simplified acquisition

7 threshold,’’.

8 (b) CONTENT OF NOTICE.—Subsection (b) of such

9 section is amended—

10 (1) by striking out ‘‘and’’ at the end of para11 graph (4);

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

13 paragraph (5) and inserting in lieu thereof a semi14 colon; and

15 (3) by adding at the end the following:

16 ‘‘(6) in the case of a contract in an amount es17 timated to exceed the $25,000 but not to exceed the

18 simplified acquisition threshold—

19 ‘‘(A) a description of the procedures to be

20 used in awarding the contract; and

21 ‘‘(B) a statement specifying the periods for

22 prospective offerors and the contracting officer

23 to take the necessary preaward and award ac24 tions.’’.

25 (c) NOTICE UNDER THE SMALL BUSINESS ACT.—
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1 (1) CONTINUATION OF EXISTING NOTICE

2 THRESHOLDS.—Subsection (e) of section 8 of the

3 Small Business Act (15 U.S.C. 637) is amended—

4 (A) in paragraph (1), by striking out ‘‘the

5 small purchase threshold’’ each place it appears

6 and inserting in lieu thereof ‘‘$25,000’’; and

7 (B) in paragraph (3)(B), by inserting after

8 ‘‘(B)’’ the following: ‘‘in the case of a contract

9 or order estimated to exceed the simplified ac10 quisition threshold,’’.

11 (2) CONTENT OF NOTICE.—Subsection (f) of

12 such section is amended—

13 (A) by striking out ‘‘and’’ at the end of

14 paragraph (4);

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

16 of paragraph (5) and inserting in lieu thereof a

17 semicolon; and

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

19 ‘‘(6) in the case of a contract in an amount es20 timated to exceed the $25,000 but not to exceed the

21 simplified acquisition threshold—

22 ‘‘(A) a description of the procedures to be

23 used in awarding the contract; and

24 ‘‘(B) a statement specifying the periods for

25 prospective offerors and the contracting officer
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1 to take the necessary preaward and award ac2 tions.’’.

3 PART III—INAPPLICABILITY OF LAWS TO ACQUI4 SITIONS NOT IN EXCESS OF SIMPLIFIED AC5 QUISITION THRESHOLD

6 Subpart A—Generally

7 SEC. 4021. INAPPLICABILITY OF FUTURE ENACTED PRO8 CUREMENT LAWS TO CONTRACTS NOT EX9 CEEDING THE SIMPLIFIED ACQUISITION

10 THRESHOLD.

11 The Office of Federal Procurement Policy Act (41

12 U.S.C. 401 et seq.), as amended by section 4011, is fur13 ther amended by adding at the end the following new sec14 tion:

15 ‘‘INAPPLICABILITY OF CERTAIN LAWS TO CONTRACTS

16 NOT EXCEEDING SIMPLIFIED ACQUISITION THRESHOLD

17 ‘‘SEC. 30. (a) IN GENERAL.—The applicability of a

18 provision of law described in subsection (b) to contracts

19 not in excess of the simplified acquisition threshold may

20 be waived on a class basis in the Federal Acquisition Reg21 ulation. Such a waiver shall not apply to a provision of

22 law that expressly refers to this section and prohibits the

23 waiver of that provision of law.

24 ‘‘(b) REFERENCED LAW.—A provision of law referred

25 to in subsection (a) is any provision of law enacted after

26 the date of the enactment of the Federal Acquisition
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1 Streamlining Act of 1993 that, as determined by the Ad2 ministrator for Federal Procurement Policy, sets forth

3 policies, procedures, requirements, or restrictions for the

4 procurement of property or services by the Federal Gov5 ernment.’’.

6 Subpart B—Armed Services Acquisitions

7 SEC. 4031. INAPPLICABILITY OF REQUIREMENT FOR CON8 TRACT CLAUSE REGARDING CONTINGENT

9 FEES.

10 Section 2306(b) of title 10, United States Code, is

11 amended by adding at the end the following: ‘‘This sub12 section does not apply to a contract that is not in excess

13 of the simplified acquisition threshold.’’.

14 SEC. 4032. INAPPLICABILITY OF PROHIBITION ON LIMITING

15 SUBCONTRACTOR DIRECT SALES TO THE

16 UNITED STATES.

17 Section 2402 of title 10, United States Code, is

18 amended by adding at the end the following new sub19 section:

20 ‘‘(c) This section does not apply to a contract that

21 is not in excess of the simplified acquisition threshold (as

22 defined in section 4(11) of the Office of Federal Procure23 ment Policy Act (41 U.S.C. 403(11))).’’.
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1 SEC. 4033. INAPPLICABILITY OF AUTHORITY TO EXAMINE

2 BOOKS AND RECORDS OF CONTRACTORS.

3 Section 2313 of title 10, United States Code, as

4 amended by section 2201, is further amended by adding

5 at the end of subsection (e) the following:

6 ‘‘(2) A contract that is not in excess of the sim7 plified acquisition threshold.’’.

8 SEC. 4034. INAPPLICABILITY OF REQUIREMENT TO IDEN9 TIFY SUPPLIERS AND SOURCES OF SUPPLIES.

10 Section 2384(b) of title 10, United States Code, is

11 amended by adding at the end the following new para12 graph:

13 ‘‘(3) The regulations prescribed pursuant to para14 graph (1) do not apply to a contract that does not exceed

15 the simplified acquisition threshold (as defined in section

16 4(11) of the Office of Federal Procurement Policy Act (41

17 U.S.C. 403(11))).’’.

18 SEC. 4035. INAPPLICABILITY OF PROHIBITION AGAINST

19 DOING BUSINESS WITH CERTAIN OFFERORS

20 OR CONTRACTORS.

21 Section 2393(d) of title 10, United States Code, is

22 amended in the second sentence by striking out ‘‘above’’

23 and all that follows and inserting in lieu thereof ‘‘in excess

24 of the simplified acquisition threshold (as defined in sec25 tion 4(11) of the Office of Federal Procurement Policy

26 Act (41 U.S.C. 403(11))).’’.
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1 SEC. 4036. INAPPLICABILITY OF PREFERENCE FOR USE OF

2 UNITED STATES VESSELS FOR TRANSPORT3 ING SUPPLIES OF THE ARMED FORCES.

4 Section 2631 of title 10, United States Code, is

5 amended by adding at the end the following: ‘‘The first

6 sentence does not apply to a contract for the transpor7 tation of those supplies by sea if the contract does not

8 exceed the simplified acquisition threshold (as defined in

9 section 4(11) of the Office of Federal Procurement Policy

10 Act (41 U.S.C. 403(11))).’’.

11 Subpart C—Civilian Agency Acquisitions

12 SEC. 4041. INAPPLICABILITY OF REQUIREMENT FOR CON13 TRACT CLAUSE REGARDING CONTINGENT

14 FEES.

15 Section 304(a) of the Federal Property and Adminis16 trative Services Act of 1949 (41 U.S.C. 254(a)) is amend17 ed by adding at the end the following: ‘‘The preceding sen18 tence does not apply to a contract that is not in excess

19 of the simplified acquisition threshold.’’.

20 SEC. 4042. INAPPLICABILITY OF PROHIBITION ON LIMITING

21 SUBCONTRACTOR DIRECT SALES TO THE

22 UNITED STATES.

23 Section 303G of the Federal Property and Adminis24 trative Services Act of 1949 (41 U.S.C. 253g) is amended

25 by adding at the end the following new subsection:
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1 ‘‘(c) This section does not apply to a contract that

2 is not in excess of the simplified acquisition threshold.’’.

3 SEC. 4043. INAPPLICABILITY OF AUTHORITY TO EXAMINE

4 BOOKS AND RECORDS OF CONTRACTORS.

5 Section 304B of the Federal Property and Adminis6 trative Services Act of 1949, as added by section 2251(a),

7 is amended by adding at the end of subsection (e) the fol8 lowing:

9 ‘‘(2) A contract that is not in excess of the sim10 plified acquisition threshold.’’.

11 Subpart D—Acquisitions Generally

12 SEC. 4051. INAPPLICABILITY OF LIMITATION ON USE OF

13 FUNDS TO INFLUENCE CERTAIN FEDERAL

14 ACTIONS.

15 Section 1352(e)(2)(B) of title 31, United States

16 Code, is amended by striking out ‘‘$100,000’’ and insert17 ing in lieu thereof ‘‘the simplified acquisition threshold (as

18 defined in section 4(11) of the Office of Federal Procure19 ment Policy Act (41 U.S.C. 403(11)))’’.

20 SEC. 4052. INAPPLICABILITY OF REQUIREMENT FOR CON21 TRACT CLAUSE RELATING TO KICKBACKS.

22 Section 7 of the Anti-Kickback Act of 1986 (41

23 U.S.C. 57) is amended by adding at the end the following

24 new subsection:
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1 ‘‘(d) Subsections (a) and (b) do not apply to a prime

2 contract that is not in excess of the simplified acquisition

3 threshold (as defined in section 4(11) of the Office of Fed4 eral Procurement Policy Act (41 U.S.C. 403(11))).’’.

5 SEC. 4053. INAPPLICABILITY OF THE MILLER ACT TO CON6 TRACTS BELOW THE SIMPLIFIED ACQUISI7 TION THRESHOLD.

8 (a) IN GENERAL.—

9 (1) CONTRACTS NOT EXCEEDING SIMPLIFIED

10 ACQUISITION THRESHOLD.—The Act of August 24,

11 1935 (40 U.S.C. 270a et seq.), commonly referred

12 to as the ‘‘Miller Act’’, is amended by adding at the

13 end the following new section:

14 ‘‘SEC. 5. This Act does not apply to a contract in

15 an amount that is not in excess of the simplified acquisi16 tion threshold (as defined in section 4(11) of the Office

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

18 403(11))).’’.

19 (2) CONFORMING AMENDMENT.—Subsection (a)

20 of the first section of such Act is amended by strik21 ing out ‘‘, exceeding $25,000 in amount,’’.

22 (b) ALTERNATIVE PAYMENT PROTECTIONS.—

23 (1) REGULATIONS REQUIRED.—The Federal

24 Acquisition Regulation shall provide alternatives to

25 payment bonds as payment protections for suppliers
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1 of labor and materials on contracts referred to in

2 paragraph (2).

3 (2) COVERED CONTRACTS.—The protections re4 quired by paragraph (1) shall apply with respect to

5 contracts referred to in subsection (a) of the first

6 section of the Miller Act that are in excess of

7 $25,000 but not in excess of the simplified acquisi8 tion threshold (as defined in section 4(11) of the Of9 fice of Federal Procurement Policy Act (41 U.S.C.

10 403(11))).

11 (3) MILLER ACT REFERENCE.—The Miller Act

12 referred to in paragraph (2) means the Act of Au13 gust 24, 1935 (40 U.S.C. 270a et seq.), commonly

14 referred to as the ‘‘Miller Act’’.

15 SEC. 4054. INAPPLICABILITY OF CONTRACT WORK HOURS

16 AND SAFETY STANDARDS ACT.

17 (a) IN GENERAL.—Section 103 of the Contract Work

18 Hours and Safety Standards Act (40 U.S.C. 329) is

19 amended by adding at the end the following new sub20 section:

21 ‘‘(c) This title does not apply to a contract in an

22 amount that is not in excess of the simplified acquisition

23 threshold (as defined in section 4(11) of the Office of Fed24 eral Procurement Policy Act (41 U.S.C. 403(11))).’’.
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1 (b) CONFORMING AMENDMENT.—Section 107(a) of

2 such Act (40 U.S.C. 333(a)) is amended by inserting after

3 ‘‘It shall be a condition of each contract’’ the following:

4 ‘‘(other than a contract referred to in section 103(c))’’.

5 SEC. 4055. INAPPLICABILITY OF THE DRUG-FREE WORK6 PLACE ACT OF 1988.

7 Section 5152(a)(1) of the Drug-Free Workplace Act

8 of 1988 (subtitle D of title V of the Anti-Drug Abuse Act

9 of 1988; Public Law 100–690; 41 U.S.C. 701(a)(1)) is

10 amended by striking out ‘‘of $25,000 or more from any

11 Federal agency’’ and inserting in lieu thereof ‘‘in excess

12 of the simplified acquisition threshold (as defined in sec13 tion 4(11) of such Act (41 U.S.C. 403(11))) by any Fed14 eral agency’’.

15 SEC. 4056. INAPPLICABILITY OF A REQUIREMENT IN THE

16 MERCHANT MARINE ACT, 1936, TO SHIP ON

17 AMERICAN-FLAG COMMERCIAL VESSELS.

18 Section 901(b) of the Merchant Marine Act, 1936 (46

19 U.S.C. 1241(b)) is amended by adding at the end the fol20 lowing new paragraph:

21 ‘‘(3) Paragraph (1) does not apply to a contract for

22 transportation on ocean vessels in an amount that is not

23 in excess of the simplified acquisition threshold (as defined

24 in section 4(11) of the Office of Federal Procurement Pol25 icy Act (41 U.S.C. 403(11))). The gross tonnage trans-
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1 ported under such a contract may not be counted for pur2 poses of determining the minimum gross tonnage required

3 to be transported on privately owned United States-flag

4 commercial vessels or for purposes of satisfying such re5 quirement.’’.

6 SEC. 4057. INAPPLICABILITY OF CERTAIN PROCUREMENT

7 INTEGRITY REQUIREMENTS.

8 (a) CERTIFICATION REQUIREMENT.—Subsection

9 (e)(7)(A) of section 18 of the Office of Federal Procure10 ment Policy Act (41 U.S.C. 423) is amended by striking

11 out ‘‘$100,000’’ and inserting in lieu thereof ‘‘the sim12 plified acquisition threshold’’.

13 (b) CONTRACT CLAUSE REQUIREMENT.—Subsection

14 (g)(1) of such section is amended by inserting after

15 ‘‘awarded by a Federal agency’’ the following: ‘‘(other

16 than a contract in an amount that is not in excess of the

17 simplified acquisition threshold)’’.

18 PART IV—CONFORMING AMENDMENTS

19 SEC. 4071. ARMED SERVICES ACQUISITIONS.

20 (a) SIMPLIFIED ACQUISITION PROCEDURES.—Sec21 tion 2304(g) of title 10, United States Code, is amended—

22 (1) in paragraph (1), by striking out ‘‘small

23 purchases of property and services’’ and inserting in

24 lieu thereof ‘‘purchases of property and services not

25 in excess of the simplified acquisition threshold’’;
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1 (2) by striking out paragraph (2);

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

3 paragraphs (2) and (3), respectively;

4 (4) in paragraph (2), as so redesignated—

5 (A) by striking out ‘‘small purchase

6 threshold’’ and inserting in lieu thereof ‘‘sim7 plified acquisition threshold’’; and

8 (B) by striking out ‘‘small purchase proce9 dures’’ and inserting in lieu thereof ‘‘simplified

10 procedures’’; and

11 (5) in paragraph (3), as redesignated by para12 graph (3), by striking out ‘‘small purchase proce13 dures’’ and inserting in lieu thereof ‘‘simplified pro14 cedures’’.

15 (b) SOLICITATION CONTENT REQUIREMENT.—Sec16 tion 2305(a)(2) of title 10, United States Code, is amend17 ed by striking out ‘‘small purchases)’’ in the matter above

18 subparagraph (A) and inserting in lieu thereof ‘‘purchases

19 not in excess of the simplified acquisition threshold)’’.

20 (c) COST TYPE CONTRACTS.—Section 2306(e)(2)(A)

21 of title 10, United States Code, is amended by striking

22 out ‘‘small purchase threshold’’ and inserting in lieu there23 of ‘‘simplified acquisition threshold’’.
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1 SEC. 4072. CIVILIAN AGENCY ACQUISITIONS.

2 (a) SIMPLIFIED ACQUISITION PROCEDURES.—Sec3 tion 303(g) of the Federal Property and Administrative

4 Services Act of 1949 (41 U.S.C. 253(g)) is amended—

5 (1) in paragraph (1), by striking out ‘‘small

6 purchases of property and services’’ and inserting in

7 lieu thereof ‘‘purchases of property and services not

8 in excess of the simplified acquisition threshold’’;

9 (2) by striking out paragraph (2);

10 (3) by redesignating paragraphs (3), (4), and

11 (5) as paragraphs (2), (3), and (4), respectively;

12 (4) in paragraph (2), as so redesignated—

13 (A) by striking out ‘‘small purchase

14 threshold’’ and inserting in lieu thereof ‘‘sim15 plified acquisition threshold’’; and

16 (B) by striking out ‘‘small purchase proce17 dures’’ and inserting in lieu thereof ‘‘simplified

18 procedures’’;

19 (5) in paragraph (3), as redesignated by para20 graph (3), by striking out ‘‘small purchase proce21 dures’’ and inserting in lieu thereof ‘‘simplified pro22 cedures’’; and

23 (6) in paragraph (5), as redesignated by para24 graph (3), by striking out ‘‘the term ‘small purchase

25 threshold’ has the meaning’’ and inserting in lieu
220

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1 thereof ‘‘the term ‘simplified acquisition threshold’

2 has the meaning’’.

3 (b) SOLICITATION CONTENT REQUIREMENT.—Sec4 tion 303A(b) of the Federal Property and Administrative

5 Services Act of 1949 (41 U.S.C. 253a(b)) is amended by

6 striking out ‘‘small purchases)’’ in the matter above para7 graph (1) and inserting in lieu thereof ‘‘purchases not in

8 excess of the simplified acquisition threshold)’’.

9 (c) COST TYPE CONTRACTS.—Section 304(b) of the

10 Federal Property and Administrative Services Act of 1949

11 (41 U.S.C. 254(b)) is amended in the third sentence by

12 striking out ‘‘either $25,000’’ and inserting in lieu thereof

13 ‘‘either the simplified acquisition threshold’’.

14 SEC. 4073. OFFICE OF FEDERAL PROCUREMENT POLICY

15 ACT.

16 Section 19(a) of the Office of Federal Procurement

17 Policy Act (41 U.S.C. 417(a)) is amended by striking out

18 ‘‘procurements, other than small purchases,’’ and insert19 ing in lieu thereof ‘‘procurements in excess of the sim20 plified acquisition threshold’’.

21 SEC. 4074. SMALL BUSINESS ACT.

22 (a) DEFINITION.—Section 3(m) of the Small Busi23 ness Act (15 U.S.C. 632(m)) is amended by striking out

24 ‘‘ ‘small purchase threshold’ ’’ and inserting in lieu thereof

25 ‘‘ ‘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 subsection (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. ARMED SERVICES ACQUISITIONS.

4 (a) INAPPLICABILITY OF CERTAIN LABOR LAWS TO

5 CONSTRUCTION OF NAVAL VESSELS.—Section 7299 of

6 title 10, United States Code, is amended to read as fol7 lows: ‘‘No contract for the construction, alteration, fur8 nishing, or equipping of a naval vessel shall be subject to

9 the Act of March 3, 1931 (40 U.S.C. 276a(a)), commonly

10 referred to as the ‘Davis-Bacon Act’, or to the Service

11 Contract Act of 1965 (41 U.S.C. 351 et seq.), unless the

12 President determines that such requirement is in the in13 terest of national defense.’’.

14 (b) CLERICAL AMENDMENTS.—(1) The heading of

15 such section is amended to read as follows:

16 ‘‘§ 7299. Contracts: applicability of certain labor

17 laws’’.

18 (2) The item relating to such section in the table of

19 sections at the beginning of chapter 633 of title 10, United

20 States Code, is amended to read as follows:

‘‘7299. Contracts: applicability of certain labor laws.’’.

21 SEC. 4102. ACQUISITIONS GENERALLY.

22 (a) REPEAL OF EXECUTED REPORTING REQUIRE23 MENT.—Section 306 of the Trade Agreements Act of 1979

24 (19 U.S.C. 2516) is repealed.
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1 (b) WALSH-HEALEY ACT.—

2 (1) REPEAL OTHER THAN FOR CERTAIN DEFI3 NITIONAL PURPOSES.—The Act of June 30, 1936

4 (41 U.S.C. 35 et seq.), commonly referred to as the

5 ‘‘Walsh-Healey Act’’, is amended to read as follows:

6 ‘‘SECTION 1. (a) The Secretary of Labor may pre7 scribe in regulations the standards for determining wheth8 er a contractor is a manufacturer of or a regular dealer

9 in materials, supplies, articles, or equipment to be manu10 factured or used in the performance of a contract entered

11 into by any executive department, independent establish12 ment, or other agency or instrumentality of the United

13 States, or by the District of Columbia, or by any corpora14 tion all the stock of which is beneficially owned by the

15 United States, for the manufacture or furnishing of mate16 rials, supplies, articles, and equipment.

17 ‘‘(b) Any interested person shall have the right of ju18 dicial review of any legal question regarding the interpre19 tation of the terms ‘regular dealer’ and ‘manufacturer’,

20 as defined pursuant to subsection (a).’’

21 (2) CONFORMING AMENDMENT.—Section

22 2304(h) of title 10, United States Code, is amended

23 to read as follows:

24 ‘‘(h) For the purposes of the Act entitled ‘An Act

25 relating to the rate of wages for laborers and mechanics
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1 employed on public buildings of the United States and the

2 District of Columbia by contractors and subcontractors,

3 and for other purposes’, approved March 3, 1931 (com4 monly referred to as the ‘Davis-Bacon Act’) (40 U.S.C.

5 276a et seq.), purchases or contracts awarded after using

6 procedures other than sealed-bid procedures shall be treat7 ed as if they were made with sealed-bid procedures.’’.

8 (c) REPEAL OF REDUNDANT REQUIREMENT RE9 GARDING APPLICABILITY OF THE DAVIS-BACON ACT AND

10 THE WALSH-HEALEY ACT.—Section 308 of the Federal

11 Property and Administrative Services Act of 1949 (41

12 U.S.C. 258) is repealed.

13 (d) PROHIBITION ON CONVICT LABOR AND PRISON

14 GOODS.—No agency of the United States shall purchase

15 any goods, wares or merchandise whose transportation in

16 interstate commerce, or whose importation, is prohibited

17 by section 1761 of title 18, United States Code. The pre18 ceding sentence does not apply to a contract in an amount

19 that does not exceed the simplified acquisition threshold

20 (as defined in section 4(11) of the Office of Federal Pro21 curement Policy Act (41 U.S.C. 403(11))).

22 SEC. 4103. DIRECT CONTRACTING WITH SMALL BUSI23 NESSES.

24 Section 8(a)(1) of the Small Business Act (15 U.S.C.

25 637(a)(1)) is amended in subparagraph (A) by striking
226

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1 out ‘‘In any case in which the Administration certifies’’

2 and all that follows through ‘‘may be agreed upon between

3 the Administration and the procurement officer.’’ and in4 serting in lieu thereof the following: ‘‘In any case in which

5 the Administration certifies to any officer of the Govern6 ment having procurement powers that the Administration

7 is competent and responsible to perform any specific Gov8 ernment procurement contract to be awarded by any such

9 officer, such officer shall be authorized in his discretion

10 (i) to award such procurement contract to the Administra11 tion upon such terms and conditions as may be agreed

12 upon between the Administration and the procurement of13 ficer, or (ii) to award such procurement contract directly

14 to a socially and economically disadvantaged small busi15 ness concern designated by the Administration, except

16 that such contract may not be awarded directly to that

17 small business concern if the small business concern re18 quests that the award be made through the Administra19 tion.’’.
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1 Subtitle C—Miscellaneous

2 Acquisition Laws

3 SEC. 4151. REPEAL OF OBSOLETE LAWS RELATING TO PRO4 CUREMENT OF NAVAL AIRCRAFT AND COM5 PONENTS.

6 (a) AUTHORIZED NUMBER.—Section 7341 of title

7 10, United States Code, is repealed.

8 (b) CONSTRUCTION OR MANUFACTURE IN FEDERAL

9 GOVERNMENT PLANTS.—

10 (1) MINIMUM PERCENTAGE.—Section 7342 of

11 title 10, United States Code, is repealed.

12 (2) AUTHORIZATION UNDER CERTAIN CIR13 CUMSTANCES.—Section 7343 of title 10, United

14 States Code, is repealed.

15 (c) ANNUAL REPORT OF NAVY AIRCRAFT REQUIRE16 MENTS.—Section 7345 of title 10, United States Code, is

17 repealed.

18 (d) CLERICAL AMENDMENTS.—The table of sections

19 at the beginning of chapter 635 of title 10, United States

20 Code, is amended by striking out the items relating to sec21 tions 7341, 7342, 7343, and 7345.
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1 SEC. 4152. REVISION AND CODIFICATION OF PROHIBITION

2 ON USE OF FUNDS FOR DOCUMENTING ECO3 NOMIC OR EMPLOYMENT IMPACT OF CER4 TAIN ACQUISITION PROGRAMS.

5 (a) IN GENERAL.—Subchapter I of chapter 134 of

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

7 end the following new section:

8 ‘‘§ 2246. Prohibition on use of funds for documenting

9 economic or employment impact of cer10 tain acquisition programs

11 ‘‘No funds appropriated by the Congress may be obli12 gated or expended to assist any contractor of the Depart13 ment of Defense in preparing any material, report, lists,

14 or analysis with respect to the actual or projected eco15 nomic or employment impact in a particular State or con16 gressional district of an acquisition program for which all

17 research, development, testing, and evaluation has not

18 been completed.’’.

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

20 at the beginning of such subchapter is amended by adding

21 at the end the following new item:

‘‘2246. Prohibition on use of funds for documenting economic or employment

impact of certain acquisition programs.’’.
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1 SEC. 4153. RESTRICTION ON USE OF NONCOMPETITIVE

2 PROCEDURES FOR PROCUREMENT FROM A

3 PARTICULAR SOURCE.

4 (a) ARMED SERVICES ACQUISITIONS.—Section 2304

5 of title 10, United States Code, as amended by section

6 1005(b), is further amended—

7 (1) in subsection (c)(5), by inserting ‘‘subject to

8 subsection (j),’’ after ‘‘(5)’’; and

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

11 ‘‘(j)(1) It is the policy of Congress that no legislation

12 should be enacted that requires a procurement to be made

13 from a specified non-Federal Government source.

14 ‘‘(2) A provision of law may not be construed as re15 quiring a procurement to be made from a specified non16 Federal Government source unless that provision of law—

17 ‘‘(A) specifically refers to this subsection;

18 ‘‘(B) specifically identifies the particular non19 Federal Government source involved; and

20 ‘‘(C) specifically states that the procurement

21 from that source is required by such provision of law

22 in contravention of the policy set forth in paragraph

23 (1).’’.

24 (b) CIVILIAN AGENCY ACQUISITIONS.—Section 303

25 of the Federal Property and Administrative Services Act

26 of 1949 (41 U.S.C. 253) is amended—
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1 (1) in subsection (c)(5), by inserting ‘‘subject to

2 subsection (h),’’ after ‘‘(5)’’; and

3 (2) by adding at the end the following new sub4 section:

5 ‘‘(h)(1) It is the policy of Congress that no legislation

6 should be enacted that requires a procurement to be made

7 from a specified non-Federal Government source.

8 ‘‘(2) A provision of law may not be construed as re9 quiring a procurement to be made from a specified non10 Federal Government source unless that provision of law—

11 ‘‘(A) specifically refers to this subsection;

12 ‘‘(B) specifically identifies the particular non13 Federal Government source involved; and

14 ‘‘(C) specifically states that the procurement

15 from that source is required by such provision of law

16 in contravention of the policy set forth in paragraph

17 (1).’’.

18 TITLE V—INTELLECTUAL

19 PROPERTY

20 Subtitle A—Technology Transfer

21 SEC. 5001. COPYRIGHT PROTECTION FOR COMPUTER PRO22 GRAMS OF THE FEDERAL GOVERNMENT.

23 (a) GENERAL AUTHORITY TO COPYRIGHT.—Section

24 15 of the Stevenson-Wydler Technology Innovation Act of

25 1980 (15 U.S.C. 3710d) is amended—
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1 (1) by redesignating subsections (b) and (c) as

2 subsections (c) and (d), respectively; and

3 (2) by inserting after subsection (a) the follow4 ing new subsection (b):

5 ‘‘(b) RIGHTS TO COMPUTER PROGRAMS PREPARED

6 BY GOVERNMENT EMPLOYEES.—(1) For purposes of title

7 17, United States Code—

8 ‘‘(A) a computer program prepared by an offi9 cer or employee of the Federal Government in the

10 course of the officer’s or employee’s official duties

11 shall be considered as a work made for hire within

12 the meaning of paragraph (1) of the definition of the

13 term ‘work made for hire’ set forth in section 101

14 of such title; and

15 ‘‘(B) notwithstanding section 105 of such title,

16 the Federal Government shall be considered the au17 thor of the computer program for purposes of sec18 tion 201(b) of such title.

19 ‘‘(2)(A) If the Federal agency concerned does not in20 tend to register a copyright of the computer program or

21 otherwise to promote the commercialization of the com22 puter program, the Federal agency may enter into an

23 agreement with the officer or employee of the Federal

24 Government who prepared the computer program to allow

25 such officer or employee to own a copyright protecting
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1 such computer program under title 17, United States

2 Code.

3 ‘‘(B) The agreement shall be a written instrument

4 that satisfies the requirements of section 201(b) of title

5 17, United States Code.

6 ‘‘(C) The agreement shall include—

7 ‘‘(i) a reservation for the Federal Government

8 of a nonexclusive, nontransferable, irrevocable, paid9 up license to exercise all rights under the copyright

10 by or on behalf of the Federal Government through11 out the world; and

12 ‘‘(ii) such other reservations as the head of the

13 Federal agency concerned considers necessary to en14 sure distribution and utilization of the computer pro15 gram.

16 ‘‘(3) In this subsection, the term ‘computer program’

17 has the meaning given such term in section 101 of title

18 17, United States Code.’’.

19 (b) WORKS IN CONNECTION WITH COOPERATIVE RE20 SEARCH AND DEVELOPMENT AGREEMENTS.—

21 (1) COPYRIGHT PROTECTION FOR THE UNITED

22 STATES.—Section 12 of the Stevenson-Wydler Tech23 nology Innovation Act of 1980 (15 U.S.C. 3710a) is

24 amended by adding at the end the following new

25 subsection:
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1 ‘‘(h) COPYRIGHT OF COMPUTER PROGRAMS.—(1)

2 Notwithstanding section 105 of title 17, United States

3 Code, a Federal agency may secure, on behalf of the

4 United States as author or proprietor, copyright protec5 tion for any computer program prepared by an employee

6 of the Federal Government in the course of work under,

7 or work related to, a cooperative research and development

8 agreement entered into by such Federal agency under the

9 authority of subsection (a)(1) or under any similar author10 ity.

11 ‘‘(2) A Federal agency may grant or agree to grant

12 in advance to a collaborating party licenses or assignments

13 for a copyright of a computer program registered pursuant

14 to paragraph (1), or options thereto, retaining—

15 ‘‘(A) a nonexclusive, nontransferable, irrev16 ocable, paid-up license to reproduce, adapt, trans17 late, distribute, and publicly perform or display the

18 computer program throughout the world by or on

19 behalf of the Federal Government; and

20 ‘‘(B) such other rights that the Federal agency

21 deems appropriate.’’.

22 (2) COMPUTER PROGRAM DEFINED.—Sub23 section (d) of such section is amended—

24 (A) by striking out ‘‘section—’’ and insert25 ing in lieu thereof ‘‘section:’’;
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1 (B) by capitalizing the initial letter of the

2 first word in each of paragraphs (1), (2), and

3 (3);

4 (C) by striking out the semicolon at the

5 end of paragraph (1) and inserting in lieu

6 thereof a period;

7 (D) in paragraph (2), by striking out ‘‘;

8 and’’ at the end and inserting in lieu thereof a

9 period; and

10 (E) by adding at the end the following new

11 paragraph:

12 ‘‘(5) The term ‘computer program’ has the

13 meaning given such term in section 101 of title 17,

14 United States Code.’’.

15 SEC. 5002. USE OF COPYRIGHTED WORKS OF THE FEDERAL

16 GOVERNMENT.

17 Section 12 of the Stevenson-Wydler Technology Inno18 vation Act of 1980 (15 U.S.C. 3710a) is amended—

19 (1) in subsection (a)—

20 (A) in paragraph (1)—

21 (i) by inserting ‘‘or copyrighted

22 works’’ after ‘‘(including licensees of inven23 tions’’; and

24 (ii) by striking out ‘‘and’’ at the end;
235

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

2 of paragraph (2) and inserting in lieu thereof ‘‘;

3 and’’; and

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

5 paragraph:

6 ‘‘(3) to negotiate licensing agreements consist7 ent with section 207 of title 35, United States Code,

8 or under other authorities (in the case of a Govern9 ment-owned, contractor-operated laboratory, subject

10 to subsection (c) of this section) for copyrighted

11 works owned by the Federal Government pursuant

12 to subsection (h) or copyrighted works that may be

13 voluntarily assigned to the Federal Government.’’;

14 and

15 (2) in subsection (b)—

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

17 and inserting in lieu thereof the following:

18 ‘‘(2) grant or agree to grant in advance, to a

19 collaborating party—

20 ‘‘(A) patent licenses or assignments, or op21 tions thereto, in any invention made in whole or

22 in part by a laboratory employee under the

23 agreement, retaining—

24 ‘‘(i) a nonexclusive, nontransferable,

25 irrevocable, paid-up license to practice the
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•S 1587 RIS

1 invention, or have the invention practiced,

2 throughout the world by or on behalf of

3 the Government; and

4 ‘‘(ii) such other rights as the Federal

5 laboratory deems appropriate; and

6 ‘‘(B) copyright licenses or assignments, or

7 options thereto, in any copyrighted work pre8 pared in whole or in part by a laboratory em9 ployee under the agreement, retaining—

10 ‘‘(i) a nonexclusive, nontransferable,

11 irrevocable, paid-up license to exercise all

12 rights under the copyright, or have all

13 rights under the copyright exercised,

14 throughout the world by or on behalf of

15 the Government; and

16 ‘‘(ii) such other rights as the Federal

17 laboratory deems appropriate;

18 ‘‘(3) waive in advance, in whole or in part, any

19 right of ownership which the Federal Government

20 may have to—

21 ‘‘(A) any subject invention made under the

22 agreement by a collaborating party or employee

23 of a collaborating party, subject to reservation

24 by the Government of a nonexclusive, irrev25 ocable, paid-up license to practice the invention,
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•S 1587 RIS

1 or have the invention practiced, throughout the

2 world by or on behalf of the Government; or

3 ‘‘(B) any subject copyrighted work pre4 pared under the agreement by a collaborating

5 party or employee of a collaborating party, sub6 ject to reservation by the Government of a

7 nonexclusive, irrevocable, paid-up license to re8 produce the copyrighted work, or have the copy9 righted work reproduced, throughout the world

10 by or on behalf of the Government;’’;

11 (B) by striking out paragraph (5) and in12 serting in lieu thereof the following:

13 ‘‘(5) to the extent consistent with any applica14 ble agency requirements and standards of conduct,

15 permit an employee or former employees of the lab16 oratory to participate in efforts to commercialize an

17 invention that the employee or former employee

18 made, or a copyrighted work that the employee or

19 former employee prepared, while in the service of the

20 United States (notwithstanding that such employee

21 or former employee may have received royalties pur22 suant to section 14), but only if such employee or

23 former employee did not participate in the selection

24 of the collaborating party to the relevant cooperative

25 research and development agreement or in the nego-
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•S 1587 RIS

1 tiation of a licensing agreement under which the in2 vention or copyrighted work, as the case may be, is

3 being commercialized.’’; and

4 (C) in the matter following paragraph

5 (5)—

6 (i) by inserting ‘‘or copyrighted work’’

7 after ‘‘any invention’’; and

8 (ii) in clause (i), by inserting ‘‘or to

9 authors of copyrighted works’’ after ‘‘in10 ventors’’.

11 SEC. 5003. DISTRIBUTION OF ROYALTIES RECEIVED BY

12 FEDERAL AGENCIES.

13 (a) COPYRIGHTED WORKS.—Section 14 of the Ste14 venson-Wydler Technology Innovation Act of 1980 (15

15 U.S.C. 3710c) is amended—

16 (1) in subsection (a)—

17 (A) in the matter above subparagraph (A),

18 by striking out ‘‘inventions under agreements’’

19 and all that follows through ‘‘produced the in20 vention’’ and inserting in lieu thereof ‘‘an in21 vention or copyrightable work under an agree22 ment entered into by a Government-operated

23 Federal laboratory under section 12, and an in24 vention or copyrightable work of a Government25 operated Federal laboratory licensed under sec-
239

•S 1587 RIS

1 tion 207 of title 35, United States Code, or

2 under any other provision of law, shall be re3 tained by the agency whose laboratory produced

4 the invention or copyrighted work’’;

5 (B) in paragraph (1)(A)—

6 (i) in clause (i)—

7 (I) in the first sentence, by strik8 ing out ‘‘inventor’’ and all that follows

9 and inserting in lieu thereof ‘‘inventor

10 or copyrighted work to the author (or

11 the co-inventors or co-authors) if the

12 inventor or author (or each such co13 inventor or co-author) has assigned

14 his or her rights in the invention or

15 copyrighted work to the United

16 States.’’; and

17 (II) by striking out the second

18 sentence;

19 (ii) in clause (ii)—

20 (I) by inserting ‘‘or authors’’

21 after ‘‘inventors’’ in the matter above

22 subclause (I);

23 (II) by striking out ‘‘inventor,’’

24 in subclauses (I) and (II) and insert-
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1 ing in lieu thereof ‘‘inventor or au2 thor’’;

3 (III) by inserting ‘‘or author’s

4 copyrighted work’’ in subclauses (I)

5 and (II) after ‘‘inventor’s invention’’;

6 (IV) in subclause (III), by insert7 ing ‘‘and authors’’ after ‘‘such inven8 tors’’; and

9 (V) in subclause (IV), by striking

10 out ‘‘licensed invention’’ and all that

11 follows and inserting in lieu thereof

12 ‘‘licensed invention between the time

13 of the filing of the patent application

14 and the licensing of the invention or

15 to the technical development of a li16 censed copyrighted work between the

17 time of the filing of the application for

18 copyright registration and the licens19 ing of the copyrighted work.’’; and

20 (iii) by adding at the end the follow21 ing new clause (iv):

22 ‘‘(iv) An agency that has published its intention to

23 promulgate regulations under clause (ii) with regard to

24 authors of copyrighted works may elect not to pay authors

25 under clause (i) until the earlier of the date two years
241

•S 1587 RIS

1 after the date of the enactment of the Federal Acquisition

2 Streamlining Act of 1993 or the date of the promulgation

3 of such regulations. If an agency makes such an election

4 and after two years the regulations have not been promul5 gated, the agency shall make payments (in accordance

6 with clause (i)) of at least 15 percent of the royalties in7 volved, retroactive to the date of the enactment of the Fed8 eral Acquisition Streamlining Act of 1993. If promulga9 tion of the regulations occurs within two years after the

10 date of the enactment of the Federal Acquisition Stream11 lining Act of 1993, payments shall be made in accordance

12 with such regulations, retroactive to such date. The agency

13 shall retain its royalties until the author’s portion is paid

14 under either clause (i) or (ii). Such royalties may not be

15 transferred to the agency’s Government-operated labora16 tories under subparagraph (B) and may not revert to the

17 Treasury pursuant to paragraph (2) as a result of any

18 delay caused by rule making under this subparagraph.’’;

19 (C) in paragraph (1)(B)—

20 (i) in the matter above clause (i), by

21 striking out ‘‘going to the laboratory where

22 the invention occurred’’ and inserting in

23 lieu thereof ‘‘or copyrighted work going to

24 the laboratory where the invention oc-
242

•S 1587 RIS

1 curred or the copyrighted work was pre2 pared’’; and

3 (ii) in clause (i)—

4 (I) by inserting ‘‘or copyrighted

5 works’’ after ‘‘licensing of inventions’’;

6 (II) by inserting ‘‘, or copy7 righted works were prepared,’’ after

8 ‘‘inventions which occurred’’; and

9 (III) by inserting ‘‘or copyrighted

10 work’’ before ‘‘management’’;

11 (D) in paragraph (2), by inserting ‘‘and

12 authors’’ after ‘‘inventors’’;

13 (E) in paragraph (3), by inserting ‘‘or au14 thor’’ after ‘‘inventor’’ both places it appears in

15 the second sentence; and

16 (F) in the first sentence of paragraph

17 (4)—

18 (i) by inserting ‘‘, or copyrighted work

19 management services,’’ after ‘‘management

20 services’’;

21 (ii) by inserting ‘‘or authors’’ after

22 ‘‘inventors’’;

23 (iii) by inserting ‘‘or copyrighting’’

24 after ‘‘patenting’’; and
243

•S 1587 RIS

1 (iv) by inserting ‘‘or copyright’’ after

2 ‘‘for any invention’’;

3 (2) in subsection (b)—

4 (A) in the matter above paragraph (1), by

5 inserting ‘‘or copyrightable work’’ after ‘‘inven6 tion’’; and

7 (B) in paragraph (2), by striking out ‘‘at

8 the time’’ and all that follows and inserting in

9 lieu thereof ‘‘at the time the invention was

10 made or copyrightable work was prepared,’’;

11 and

12 (3) in subsection (c)—

13 (A) in paragraph (1)—

14 (i) by striking out ‘‘(1)’’; and

15 (ii) by inserting ‘‘or author’’ after

16 ‘‘(including inventor’’; and

17 (B) by striking out paragraph (2).

18 (b) EFFECTIVE DATE.—The amendment made by

19 subsection (a)(1)(B)(i)(I) shall take effect with respect to

20 a department or agency of the Federal Government as of

21 the date of the enactment of this Act unless, within 90

22 days after that date, such department or agency publishes

23 in the Federal Register a notice of election to file a notice

24 of proposed rulemaking with regard to authors of copy25 righted works pursuant to section 14(a)(1)(A)(ii) of the
244

•S 1587 RIS

1 Stevenson-Wydler Technology Innovation Act of 1980 (15

2 U.S.C. 3710c(a)(1)(A)(ii)), as amended by subsection

3 (a)(1)(B)(ii).

4 SEC. 5004. EXCEPTION TO PROHIBITION ON COPYRIGHT

5 PROTECTION FOR WORKS OF THE FEDERAL

6 GOVERNMENT.

7 The text of section 105 of title 17, United States

8 Code, is amended to read as follows:

9 ‘‘(a) Except as provided in subsection (b), copyright

10 protection under this title is not available for any work

11 of the United States Government.

12 ‘‘(b)(1) Subsection (a) does not preclude the United

13 States from receiving and holding copyrights transferred

14 to it by assignment, bequest, or otherwise.

15 ‘‘(2) Subsection (a) does not preclude the United

16 States from copyright protection under this title that is

17 authorized in section 12(h) or 15(b) of the Stevenson18 Wydler Technology Innovation Act of 1980 (15 U.S.C.

19 3710a(h) or 3710d(b)).’’.
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•S 1587 RIS

1 Subtitle B—Government Use of Pri2 vate Patents, Copyrights, and

3 Trade Secrets

4 SEC. 5011. GOVERNMENT USE OR MANUFACTURE OF A PAT5 ENTED INVENTION.

6 (a) WITHHOLDING OF GOVERNMENT CONSENT FOR

7 CONTRACTOR USE OR MANUFACTURE.—The second un8 designated paragraph of section 1498(a) of title 28, Unit9 ed States Code, is amended by inserting after the first

10 sentence the following: ‘‘The Federal Acquisition Regu11 latory Council established under section 25(a) of the Of12 fice of Federal Procurement Policy Act (41 U.S.C. 421(a))

13 shall prescribe in the Federal Acquisition Regulation the

14 circumstances under which a contracting officer may with15 hold authorization or consent under this paragraph. The

16 Federal Acquisition Regulation shall provide that author17 ization or consent may not ordinarily be granted for con18 tracts for the acquisition of commercial items (as defined

19 in section 4(12) of such Act (41 U.S.C. 403(12))).’’.

20 (b) INJUNCTION NOT AUTHORIZED REGARDING

21 GOVERNMENT CONTRACTOR USE OR MANUFACTURE.—

22 Section 283 of title 35, United States Code, is amended

23 by adding at the end the following: ‘‘Notwithstanding the

24 preceding sentence, no such court may grant an injunction

25 in the case of a violation of a right secured by patent that
246

•S 1587 RIS

1 occurs in the performance of a Federal Government con2 tract.’’.

3 SEC. 5012. DEPARTMENT OF DEFENSE ACQUISITION OF IN4 TELLECTUAL PROPERTY RIGHTS.

5 (a) AUTHORIZED ACQUISITIONS.—Section 2386 of

6 title 10, United States Code, is amended by striking out

7 paragraphs (3) and (4) and inserting in lieu thereof the

8 following:

9 ‘‘(3) Technical data and computer software.

10 ‘‘(4) Releases for past infringement of patents

11 or copyrights or for unauthorized use of technical

12 data or computer software.’’.

13 (b) REDUNDANT PROVISION.—

14 (1) REPEAL.—Section 7210 of title 10, United

15 States Code, is repealed.

16 (2) CLERICAL AMENDMENT.—The table of sec17 tions at the beginning of chapter 631 of such title

18 is amended by striking out the item relating to sec19 tion 7210.
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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 Procurement Policy Act (41 U.S.C. 423) is

8 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-
249

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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
250

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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-
251

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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
253

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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 advisor, 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
255

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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, 2397c,

7 and 2408 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, 2397c, and 2408.

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 this section 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 accordance

15 with sections 6 and 25 of such Act (41 U.S.C. 405 and

16 521) after coordination with the Director of the Office of

17 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 1994 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 1091,
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•S 1587 RIS

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 an employee may be paid by an agency for services

8 to conduct evaluations or analyses of any aspect of a pro9 posal submitted for an acquisition unless employees with

10 adequate training and capabilities to perform such evalua11 tions and analyses are not readily available within the

12 agency or any other Federal agency.

13 ‘‘(2) In the administration of this subsection, the

14 head of each agency shall determine the standards of ade15 quate training and capability of employees to conduct such

16 acquisitions.

17 ‘‘(b) DELEGATION OF PROCUREMENT AUTHORITY.—

18 With respect to an acquisition that is subject to section

19 111 of the Federal Property and Administrative Services

20 Act of 1949 (40 U.S.C. 759), the Administrator of Gen21 eral Services may not issue a delegation of procurement

22 authority for the acquisition unless the request for the del23 egation of procurement authority includes a determination

24 of the contracting agency that—

25 ‘‘(1) such agency has and will utilize employees

26 within the agency, or employees available from an-
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1 other agency, who are adequately trained and capa2 ble of conducting evaluations and analyses of pro3 posals submitted for such an acquisition; or

4 ‘‘(2)(A) such agency does not have employees

5 within the agency who are adequately trained and

6 capable of conducting evaluations and analyses of

7 proposals submitted for such an acquisition; and

8 ‘‘(B) adequately trained and capable employees

9 are not readily available from other agencies in ac10 cordance with regulations promulgated by the Fed11 eral Acquisition Regulatory Council.

12 ‘‘(c) DEFINITION.—For purposes of this section, the

13 term ‘employee’ has the meaning given such term in sec14 tion 2105 of title 5, United States Code.’’.

15 (b) REQUIREMENT FOR GUIDANCE AND REGULA16 TIONS.—

17 (1) GUIDANCE AND REGULATIONS REQUIRED.—

18 Not later than 90 days after the date of the enact19 ment of this Act, the Federal Acquisition Regulatory

20 Council established by section 25(a) of the Office of

21 Federal Procurement Policy Act (41 U.S.C. 421(a))

22 shall—

23 (A) review part 37 of title 48 of the Code

24 of Federal Regulations as it relates to the use

25 of advisory and assistance services; and
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1 (B) provide guidance and promulgate regu2 lations regarding—

3 (i) what actions Federal agencies are

4 required to take to determine whether ex5 pertise is readily available within the Fed6 eral Government before contracting for ad7 visory and technical services to conduct ac8 quisitions; and

9 (ii) the manner in which Federal em10 ployees with expertise may be shared with

11 agencies needing expertise for such acquisi12 tions.

13 (2) DEFINITION.—In paragraph (1), the term

14 ‘‘employee’’ has the meaning given such term in sec15 tion 2105 of title 5, United States Code.

16 SEC. 6052. REPEAL OF EXECUTED REQUIREMENT FOR

17 STUDY AND REPORT.

18 Section 17 of the Office of Federal Procurement Pol19 icy Act (41 U.S.C. 415) is repealed.

20 SEC. 6053. WAITING PERIOD FOR SIGNIFICANT CHANGES

21 PROPOSED FOR ACQUISITION REGULATIONS.

22 Section 22(a) of the Office of Federal Procurement

23 Policy Act (41 U.S.C. 418b) is amended—

24 (1) by striking out ‘‘30 days’’ and inserting in

25 lieu thereof ‘‘60 days’’; and
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1 (2) by adding at the end the following: ‘‘Not2 withstanding the preceding sentence, such a policy,

3 regulation, procedure, or form may take effect ear4 lier than 60 days after the publication date when

5 there are compelling circumstances for the earlier

6 effective date, but in no event may that effective

7 date be less than 30 days after the publication

8 date.’’.

9 TITLE VII—DEFENSE TRADE AND

10 COOPERATION

11 SEC. 7001. PURCHASES OF FOREIGN GOODS.

12 (a) REPEAL OF EXECUTED REQUIREMENTS.—

13 (1) BUY AMERICAN PROVISIONS.—

14 (A) REQUIREMENT FOR POLICY GUID15 ANCE.—Title III of the Act of March 3, 1933

16 (41 U.S.C. 10a et seq.), commonly referred to

17 as the ‘‘Buy American Act’’, is amended in sec18 tion 4(g) (41 U.S.C. 10b–1(g)) by striking out

19 paragraphs (2)(C) and (3).

20 (B) REPORTING REQUIREMENT.—Section

21 9096(b) of Public Law 102–396 (106 Stat.

22 1924; 41 U.S.C. 10b–2(b)) is repealed.

23 (2) STUDIES OF BUY AMERICAN ACT WAIV24 ERS.—Section 306 of the Trade Agreements Act of

25 1970 (19 U.S.C. 2516), relating to studies of certain
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1 employment effects and procurement effects of a

2 waiver of title III of the Act of March 3, 1933 (41

3 U.S.C. 10a et seq.), commonly referred to as the

4 ‘‘Buy American Act’’, is repealed.

5 (b) REPEAL OF REDUNDANT PROVISION.—Section

6 2327 of title 10, United States Code, is repealed.

7 SEC. 7002. INTERNATIONAL COOPERATIVE AGREEMENTS.

8 (a) DEFENSE INTERNATIONAL AGREEMENTS.—

9 (1) TERMINOLOGY REVISIONS.—Section 2531

10 of title 10, United States Code, is amended—

11 (A) in the subsection captions for sub12 sections (a) and (c), by striking out ‘‘MOUS

13 AND RELATED’’ and inserting in lieu thereof

14 ‘‘INTERNATIONAL’’;

15 (B) in subsection (a), by striking out ‘‘pro16 posed memorandum of understanding, or any

17 existing or proposed agreement related to a

18 memorandum of understanding,’’ in the matter

19 above paragraph (1) and inserting in lieu there20 of ‘‘proposed international agreement, including

21 a memorandum of understanding,’’;

22 (C) by striking out ‘‘memorandum of un23 derstanding or related agreement’’ each place it

24 appears and inserting in lieu thereof ‘‘inter25 national agreement’’;
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1 (D) in subsection (b), by striking out

2 ‘‘memorandum or related agreement’’ each

3 place it appears in the second sentence and in4 serting in lieu thereof ‘‘international agree5 ment’’; and

6 (E) in subsection (c)—

7 (i) by striking out ‘‘A’’ after ‘‘AGREE8 MENTS.—’’ and inserting in lieu thereof

9 ‘‘An’’; and

10 (ii) by striking out ‘‘memorandum or

11 agreement’’ and inserting in lieu thereof

12 ‘‘international agreement’’.

13 (2) EXPANDED SCOPE OF AGREEMENTS.—Sec14 tion 2531(a) of title 10, United States Code, is

15 amended by striking out ‘‘research, development, or

16 production’’ in the matter above paragraph (1) and

17 inserting in lieu thereof ‘‘research, development, pro18 duction, or logistics support’’.

19 (3) CLERICAL AMENDMENTS.—

20 (A) SECTION HEADING.—The heading of

21 section 2531 of title 10, United States Code, is

22 amended to read as follows:

23 ‘‘§ 2531. Defense international agreements’’.

24 (B) TABLE OF SECTIONS.—The item relat25 ing to such section in the table of sections at
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1 the beginning of subchapter V of chapter 148

2 of such title is amended to read as follows:

‘‘2531. Defense international agreements.’’.

3 (b) REPEAL OF UNNECESSARY AUTHORITY.—

4 (1) REPEAL.—Section 7344 of title 10, United

5 States Code, is repealed.

6 (2) CLERICAL AMENDMENT.—The table of sec7 tions at the beginning of chapter 635 of such title

8 is amended by striking out the item relating to sec9 tion 7344.

10 SEC. 7003. ACQUISITION, CROSS-SERVICING AGREEMENTS,

11 AND STANDARDIZATION.

12 (a) LIMITED WAIVER OF RESTRICTIONS ON AC13 CRUED REIMBURSABLE LIABILITIES AND CREDITS FOR

14 CONTINGENCY OPERATIONS.—Section 2347 of title 10,

15 United States Code, is amended by adding at the end the

16 following new subsection:

17 ‘‘(c) The Secretary of Defense may waive the restric18 tions in subsections (a) and (b) for a period not to exceed

19 180 days upon a written determination that the armed

20 forces are involved in a contingency operation or that in21 volvement of the armed forces in a contingency operation

22 is imminent. Upon making such a determination, the Sec23 retary shall transmit a copy of the determination to the

24 Committees on Armed Services of the Senate and House

25 of Representatives.’’.
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1 (b) COMMUNICATIONS SUPPORT.—Section 2350f of

2 title 10, United States Code, is amended—

3 (1) by redesignating subsection (d) as sub4 section (e); and

5 (2) by inserting after subsection (c) the follow6 ing new subsection:

7 ‘‘(d)(1) Nothing in this section shall be construed to

8 limit the authority of the Secretary of Defense, without

9 a formal bilateral agreement or multilateral arrangement,

10 to furnish communications support and related supplies

11 to, or receive communications support and related supplies

12 from, an allied country in accordance with this subsection.

13 ‘‘(2) The Secretary of Defense may furnish or receive

14 such support and supplies on a reciprocal basis for a pe15 riod not to exceed 90 days—

16 ‘‘(A) in order to meet emerging operational re17 quirements of the United States and the allied coun18 try; or

19 ‘‘(B) incident to a joint military exercise with

20 the allied country.

21 ‘‘(3) If interconnection of communication circuits is

22 maintained for joint or multilateral defense purposes

23 under the authority of this subsection, the costs of main24 taining such circuits may be allocated among the various

25 users.’’.
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1 TITLE VIII—COMMERCIAL ITEMS

2 SEC. 8001. DEFINITIONS.

3 Section 4 of the Office of Federal Procurement Policy

4 Act (41 U.S.C. 403), as amended by section 4001(a), is

5 further amended—

6 (1) by striking out ‘‘Act—’’and inserting in lieu

7 thereof ‘‘Act:’’;

8 (2) by capitalizing the initial letter in the first

9 word of each paragraph;

10 (3) by striking out the semicolon at the end of

11 each of paragraphs (1), (2), (3), (5), (6), (7), (8),

12 and (9) and inserting in lieu thereof a period;

13 (4) in paragraphs (4) and (10), by striking out

14 ‘‘; and’’ at the end and inserting in lieu thereof a

15 period; and

16 (5) by adding at the end the following new

17 paragraphs:

18 ‘‘(12) The term ‘commercial item’ means—

19 ‘‘(A) property, other than real property,

20 that is of a type regularly used by the general

21 public or by nongovernmental entities in the

22 course of normal business operations for pur23 poses other than governmental purposes and—

24 ‘‘(i) has been sold or licensed to the

25 general public;
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1 ‘‘(ii) has not been sold or licensed to

2 the general public but has been offered for

3 sale or license to the general public; or

4 ‘‘(iii) is not yet available in the com5 mercial marketplace but will be made

6 available for commercial delivery within a

7 reasonable period;

8 ‘‘(B) any item that, but for minor modi9 fications made to meet Federal Government re10 quirements or modifications of a type customar11 ily available in the commercial marketplace,

12 would satisfy the criteria in subparagraph (A);

13 ‘‘(C) any combination of items meeting the

14 requirements of subparagraph (A) or (B) that

15 are of a type customarily combined and sold in

16 combination to the general public; and

17 ‘‘(D) installation services, maintenance

18 services, repair services, training services, and

19 other services if such services are procured for

20 support of an item referred to in subparagraph

21 (A), (B), or (C) and if the source of such serv22 ices—

23 ‘‘(i) offers such services to the general

24 public and the Federal Government con-
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1 temporaneously and under similar terms

2 and conditions; and

3 ‘‘(ii) offers to use the same work force

4 for providing the Federal Government with

5 such services as the source uses for provid6 ing such services to the general public.

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 4021, 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. 31. (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 other nondevelopmental items

3 may be procured to fulfill such requirements; and

4 ‘‘(3) such requirements are fulfilled through the

5 procurement of commercial items or other

6 nondevelopmental items.

7 ‘‘(b) IMPLEMENTATION.—The head of each executive

8 agency shall ensure that procurement officials in that ex9 ecutive agency, to the maximum extent practicable—

10 ‘‘(1) acquire commercial items or other

11 nondevelopmental items to meet the needs of the ex12 ecutive agency;

13 ‘‘(2) require prime contractors and subcontrac14 tors at all levels under the executive agency con15 tracts to incorporate commercial items or other

16 nondevelopmental items as components of items sup17 plied to the executive agency;

18 ‘‘(3) modify requirements in appropriate cases

19 to ensure that the requirements can be met by com20 mercial items or other nondevelopmental items;

21 ‘‘(4) state specifications in terms that enable

22 and encourage bidders and offerors to supply com23 mercial items or other nondevelopmental items in re24 sponse to the executive agency solicitations;
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1 ‘‘(5) revise the executive agency’s procurement

2 policies, practices, and procedures not required by

3 law to reduce any impediments in those policies,

4 practices, and procedures to the acquisition of com5 mercial items and other nondevelopmental items;

6 and

7 ‘‘(6) require training of appropriate personnel

8 in the acquisition of commercial items and other

9 nondevelopmental items.

10 ‘‘(c) PRELIMINARY MARKET RESEARCH.—(1) The

11 head of an executive agency shall conduct market research

12 appropriate to the circumstances—

13 ‘‘(A) before developing new specifications for a

14 procurement by that executive agency; and

15 ‘‘(B) before soliciting bids or proposals for a

16 contract in excess of the simplified acquisition

17 threshold.

18 ‘‘(2) The head of an executive agency shall use the

19 results of market research to determine whether there are

20 commercial items or other nondevelopmental items avail21 able that—

22 ‘‘(A) meet the executive agency’s requirements;

23 ‘‘(B) could be modified to meet the executive

24 agency’s requirements; or
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1 ‘‘(C) could meet the executive agency’s require2 ments if those requirements were modified to a rea3 sonable extent.’’.

4 (b) REPEAL OF SUPERSEDED PROVISION.—

5 (1) SEPARATE STATEMENT OF PREFERENCE

6 FOR DEPARTMENT OF DEFENSE.—Section 2325 of

7 title 10, United States Code, is repealed.

8 (2) CLERICAL AMENDMENT.—The table of sec9 tions at the beginning of chapter 137 of such title

10 is amended by striking out the item relating to sec11 tion 2325.

12 SEC. 8003. ACQUISITION OF COMMERCIAL ITEMS.

13 (a) REQUIRED FAR PROVISIONS.—The Office of

14 Federal Procurement Policy Act (41 U.S.C. 401 et seq.),

15 as amended by section 8002, is further amended by adding

16 at the end the following:

17 ‘‘FEDERAL ACQUISITION REGULATION PROVISIONS RE18 GARDING ACQUISITIONS OF COMMERCIAL ITEMS AND

19 COMPONENTS

20 ‘‘SEC. 32. (a) CONTRACT CLAUSES AND OTHER

21 CLAUSES.—(1)(A) The Federal Acquisition Regulation

22 shall include one or more sets of contract clauses contain23 ing the terms and conditions for the acquisition of com24 mercial items and commercial components by executive

25 agencies and by contractors in the performance of con26 tracts of executive agencies.
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1 ‘‘(B) The contract clauses referred to in subpara2 graph (A) shall include only—

3 ‘‘(i) those clauses that are required to imple4 ment provisions of law applicable to acquisitions of

5 commercial items or commercial components, as the

6 case may be;

7 ‘‘(ii) those contract clauses that are essential

8 for the protection of the Federal Government’s inter9 est in an acquisition of commercial items or commer10 cial components, as the case may be; and

11 ‘‘(iii) those contract clauses that are determined

12 to be consistent with standard commercial practice

13 and appropriate to be included in a contract or sub14 contract for commercial items or commercial compo15 nents, as the case may be.

16 ‘‘(2) Subject to paragraph (3), the Federal Acquisi17 tion Regulation shall require that, to the maximum extent

18 practicable, only the contract clauses referred to in para19 graph (1) be used in a contract or subcontract for the

20 acquisition of commercial items or commercial components

21 by or for an executive agency.

22 ‘‘(3) The Federal Acquisition Regulation shall pro23 vide that a contract or subcontract referred to in para24 graph (2) may contain contract clauses other than the

25 contract clauses referred to in that paragraph only if the
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1 other clauses are essential for the protection of the Fed2 eral Government’s interest in—

3 ‘‘(A) that contract or subcontract, as deter4 mined in writing by the contracting officer for such

5 contract; or

6 ‘‘(B) a class of contracts or subcontracts, as de7 termined by the head of an agency concerned, unless

8 the determination of that head of an agency is dis9 approved by the Administrator.

10 ‘‘(4) The Federal Acquisition Regulation shall pro11 vide standards and procedures for waiving the use of con12 tract clauses required pursuant to paragraph (1), other

13 than those required by law, including standards for deter14 mining the cases in which a waiver is appropriate.

15 ‘‘(b) MARKET ACCEPTANCE.—The Federal Acquisi16 tion Regulation shall include a requirement for the head

17 of an executive agency, when determined appropriate in

18 accordance with criteria set out in the regulation, to re19 quire offerors for a contract to demonstrate in the offer

20 that the items offered—

21 ‘‘(1) have either—

22 ‘‘(A) achieved a level of commercial market

23 acceptance necessary to indicate that the items

24 are suitable for the executive agency’s use; or
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1 ‘‘(B) been satisfactorily supplied to an ex2 ecutive agency under current or recent con3 tracts for the same or similar requirements; and

4 ‘‘(2) otherwise meet the item description, speci5 fications, or other criteria prescribed in the public

6 notice and solicitation relating to the contract.

7 ‘‘(c) USE OF FIRM, FIXED PRICE CONTRACTS.—The

8 Federal Acquisition Regulation shall include a require9 ment that firm, fixed price contracts be used, to the maxi10 mum extent practicable, for the acquisition of commercial

11 items.

12 ‘‘(d) CONTRACT QUALITY REQUIREMENTS.—The

13 Federal Acquisition Regulation shall include provisions

14 that—

15 ‘‘(1) permit, to the maximum extent prac16 ticable, a contractor under a commercial items ac17 quisition to use the contractor’s existing quality as18 surance system as a substitute for compliance with

19 a requirement for the Federal Government to inspect

20 or test the commercial items before the contractor’s

21 tender of those items for acceptance by the Federal

22 Government;

23 ‘‘(2) require that, to the maximum extent prac24 ticable, an executive agency take advantage of war25 ranties (including extended warranties) offered by
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1 offerors of commercial items and use such warran2 ties for the repair and replacement of commercial

3 items; and

4 ‘‘(3) set forth guidance to executive agencies re5 garding the use of past performance of items and

6 sources as a factor in contract award decisions.’’.

7 (b) DEFENSE CONTRACT CLAUSES.—

8 (1) REPEAL OF DOD AUTHORITY.—Section

9 824(b) of the National Defense Authorization Act

10 for Fiscal Years 1990 and 1991 (Public Law 101–

11 189; 10 U.S.C. 2325 note) is repealed.

12 (2) SAVINGS PROVISION.—Notwithstanding sec13 tion 32(a) of the Office of Federal Procurement Pol14 icy Act (as added by subsection (a)), contracts of the

15 Department of Defense entered into before October

16 1, 1994, and subcontracts entered into before such

17 date under such contracts, may include clauses de18 veloped pursuant to paragraphs (2) and (3) of sec19 tion 824(b) of the National Defense Authorization

20 Act for Fiscal Years 1990 and 1991 (Public Law

21 101–189; 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. 33. (a) IN GENERAL.—(1) The applicability of

9 a provision of law described in paragraph (2) to contracts

10 for the acquisition of commercial items may be waived on

11 a class basis in the Federal Acquisition Regulation. Such

12 a waiver shall not apply to a provision of law that ex13 pressly refers to this section and prohibits the waiver of

14 that provision of law.

15 ‘‘(2) A provision of law referred to in paragraph (1)

16 is any provision of law enacted after the date of the enact17 ment of the Federal Acquisition Streamlining Act of 1993

18 that, as determined by the Administrator for Federal Pro19 curement Policy, sets forth policies, procedures, require20 ments, or restrictions for the procurement of property or

21 services by the Federal Government.

22 ‘‘(b) WAIVER OF APPLICABILITY TO SUB23 CONTRACTS.—The applicability of a provision of law de24 scribed in subsection (a)(2) to subcontracts under a con25 tract for the acquisition of commercial items may be

26 waived on a class basis in the Federal Acquisition Regula-
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1 tion. Such a waiver shall not apply to a provision of law

2 that expressly refers to this section and prohibits the waiv3 er of that provision of law.’’.

4 SEC. 8005. INAPPLICABILITY OF CERTAIN PROVISIONS OF

5 LAW.

6 (a) ARMED SERVICES ACQUISITIONS.—

7 (1) PROHIBITION ON CONTINGENT FEES.—Sec8 tion 2306(b) of title 10, United States Code, as

9 amended by section 4031, is further amended by in10 serting before the period at the end of the sentence

11 added by section 4031 the following: ‘‘or to a con12 tract for the acquisition of commercial items’’.

13 (2) REQUIREMENT TO IDENTIFY SUPPLIERS

14 AND SOURCES OF SUPPLIES.—Paragraph (2) of sec15 tion 2384(b) of title 10, United States Code, is

16 amended to read as follows:

17 ‘‘(2) The regulations prescribed pursuant to para18 graph (1) do not apply to a contract that requires the de19 livery of supplies that are commercial items, as defined

20 in section 2302 of this title.’’.

21 (3) PROHIBITION AGAINST DOING BUSINESS

22 WITH CERTAIN OFFERORS OR CONTRACTORS.—Sec23 tion 2393(d) of title 10, United States Code, as

24 amended by section 4034, is further amended by

25 adding at the end the following: ‘‘The requirement
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1 shall not apply in the case of a subcontract for the

2 acquisition of commercial items (as defined in sec3 tion 4(12) of the Office of Federal Procurement Pol4 icy Act (41 U.S.C. 403(12))).’’.

5 (4) PROHIBITION ON LIMITATION OF SUB6 CONTRACTOR DIRECT SALES.—Section 2402 of title

7 10, United States Code, as amended by section

8 4032, is further amended by adding at the end the

9 following new subsection:

10 ‘‘(d)(1) An agreement between the contractor in a

11 contract for the acquisition of commercial items and a

12 subcontractor under such contract that restricts sales by

13 such subcontractor directly to persons other than the con14 tractor may not be considered to unreasonably restrict

15 sales by that subcontractor to the United States in viola16 tion of the provision included in such contract pursuant

17 to subsection (a) if the agreement does not result in the

18 Federal Government being treated differently with regard

19 to the restriction than any other prospective purchaser of

20 such commercial items from that subcontractor.

21 ‘‘(2) In paragraph (1), the term ‘commercial item’

22 has the meaning given such term in section 4(12) of the

23 Office of Federal Procurement Policy Act (41 U.S.C.

24 403(12)).’’.
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1 (5) PREFERENCE FOR USE OF UNITED STATES

2 VESSELS FOR TRANSPORTING SUPPLIES OF THE

3 ARMED FORCES.—Section 2631 of title 10, United

4 States Code, as amended by section 4036, is further

5 amended by inserting before the period at the end

6 of the sentence added by section 4036 the following:

7 ‘‘or to a contract for the transportation of commer8 cial items (as defined in section 4(12) of such Act

9 (41 U.S.C. 403(12))).’’.

10 (b) CIVILIAN AGENCY ACQUISITIONS.—

11 (1) RESTRICTIONS ON SUBCONTRACTOR SALES

12 TO THE UNITED STATES.—Section 303G of the Fed13 eral Property and Administrative Services Act of

14 1949 (41 U.S.C. 253g), as amended by section

15 4042, is further amended by adding at the end the

16 following new subsection:

17 ‘‘(d) An agreement between the contractor in a con18 tract for the acquisition of commercial items and a sub19 contractor under such contract that restricts sales by such

20 subcontractor directly to persons other than the contractor

21 may not be considered to unreasonably restrict sales by

22 that subcontractor to the United States in violation of the

23 provision included in such contract pursuant to subsection

24 (a) if the agreement does not result in the Federal Govern25 ment being treated differently with regard to the restric-
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1 tion than any other prospective purchaser of such commer2 cial items from that subcontractor.’’.

3 (2) PROHIBITION ON CONTINGENT FEES.—Sec4 tion 304(a) of the Federal Property and Administra5 tive Services Act of 1949 (41 U.S.C. 254(a)), as

6 amended by section 4041, is further amended by in7 serting before the period at the end of the sentence

8 added by section 4041 the following: ‘‘or to a con9 tract for the acquisition of commercial items’’.

10 (c) ACQUISITIONS GENERALLY.—

11 (1) FEDERAL WATER POLLUTION CONTROL

12 ACT.—Section 508 of the Federal Water Pollution

13 Control Act (33 U.S.C. 1368) is amended by adding

14 at the end the following new subsection:

15 ‘‘(f)(1) No certification by a contractor, and no con16 tract clause, may be required in the case of a contract

17 for the acquisition of commercial items in order to imple18 ment a prohibition or requirement of this section or a pro19 hibition or requirement issued in the implementation of

20 this section.

21 ‘‘(2) In paragraph (1), the term ‘commercial item’

22 has the meaning given such term in section 4(12) of the

23 Office of Federal Procurement Policy Act (41 U.S.C.

24 403(12)).’’.
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1 (2) CONTRACT WORK HOURS AND SAFETY

2 STANDARDS ACT.—The Contract Work Hours and

3 Safety Standards Act (title I of the Work Hours and

4 Safety Act of 1962 (40 U.S.C. 327 et seq.)) is

5 amended by adding at the end the following new sec6 tion:

7 ‘‘SEC. 108. (a) No certification by a contractor, and

8 no contract clause, may be required in the case of a con9 tract for the acquisition of commercial items in order to

10 implement a prohibition or requirement in this title.

11 ‘‘(b) In subsection (a), the term ‘commercial item’

12 has the meaning given such term in section 4(12) of the

13 Office of Federal Procurement Policy Act (41 U.S.C.

14 403(12)).’’.

15 (3) OFFICE OF FEDERAL PROCUREMENT POL16 ICY ACT REQUIREMENT RELATING TO PROCUREMENT

17 INTEGRITY CERTIFICATIONS.—Section 27(e)(7) of

18 the Office of Federal Procurement Policy Act (41

19 U.S.C. 423) is amended by adding at the end the

20 following new subparagraph:

21 ‘‘(C) This subsection does not apply to a contract for

22 the acquisition of commercial items.’’.

23 (4) CERTAIN PROVISIONS OF THE ANTI-KICK24 BACK ACT OF 1986.—
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1 (A) REQUIREMENT FOR CONTRACT

2 CLAUSE.—Section 7 of the Anti-Kickback Act

3 of 1986 (41 U.S.C. 57), as amended by section

4 4052, is further amended by inserting before

5 the period at the end of subsection (d) the fol6 lowing: ‘‘or to a prime contract for the acquisi7 tion of commercial items (as defined in section

8 4(12) of such Act (41 U.S.C. 403(12))).’’.

9 (B) INSPECTION AUTHORITY.—Section 8

10 of such Act (41 U.S.C. 58) is amended by add11 ing at the end the following: ‘‘This section does

12 not apply with respect to a prime contract for

13 the acquisition of commercial items (as defined

14 in section 4(12) of the Office of Federal Pro15 curement Policy Act (41 U.S.C. 403(12))).’’.

16 (5) DRUG-FREE WORKPLACE ACT OF 1988.—

17 The Drug-Free Workplace Act of 1988 (subtitle D

18 of title V of Public Law 100–690; 41 U.S.C. 701 et

19 seq.), as amended by section 4057, is further

20 amended by inserting after the matter inserted by

21 such section 4057 the following: ‘‘, other than a con22 tract for the procurement of commercial items (as

23 defined in section 4(12) of such Act (41 U.S.C.

24 403(12))),’’.
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1 (6) CLEAN AIR ACT.—Section 306 of the Clean

2 Air Act (42 U.S.C. 7606) is amended by adding at

3 the end the following new subsection:

4 ‘‘(f)(1) No certification by a contractor, and no con5 tract clause, may be required in the case of a contract

6 for the acquisition of commercial items in order to imple7 ment a prohibition or requirement of this section or a pro8 hibition or requirement issued in the implementation of

9 this section.

10 ‘‘(2) In paragraph (1), the term ‘commercial item’

11 has the meaning given such term in section 4(12) of the

12 Office of Federal Procurement Policy Act (41 U.S.C.

13 403(12)).’’.

14 (7) MERCHANT MARINE ACT, 1936.—Section

15 901(b) of the Merchant Marine Act, 1936 (46

16 U.S.C. 1241(b)), as amended by section 4058, is

17 further amended by adding at the end the following

18 new paragraph:

19 ‘‘(4)(A) Paragraph (1) does not apply to a contract

20 for transportation of commercial items on ocean vessels.

21 ‘‘(B) In subparagraph (A), the term ‘commercial

22 item’ has the meaning given such term in section 4(12)

23 of the Office of Federal Procurement Policy Act (41

24 U.S.C. 403(12)).’’.
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1 (8) FLY AMERICAN REQUIREMENTS.—Section

2 1117 of the Federal Aviation Act of 1958 (49

3 U.S.C. App. 1517) is amended by adding at the end

4 the following new subsection:

5 ‘‘(e)(1) No certification by a contractor, and no con6 tract clause, may be required in the case of a contract

7 for the transportation of commercial items in order to im8 plement a requirement in this section.

9 ‘‘(2) In paragraph (1), the term ‘commercial item’

10 has the meaning given such term in section 4(12) of the

11 Office of Federal Procurement Policy Act (41 U.S.C.

12 403(12)).’’.

13 SEC. 8006. FLEXIBLE DEADLINES FOR SUBMISSION OF OF14 FERS OF COMMERCIAL ITEMS.

15 Section 18(a) of the Office of Federal Procurement

16 Policy Act (41 U.S.C. 416(a)) is amended by adding at

17 the end the following new paragraph:

18 ‘‘(4) The requirements of paragraph (3)(B) do not

19 apply to contracts for the purchase of commercial items.

20 The Administrator shall prescribe for such contracts ap21 propriate limits on the applicability of a deadline for sub22 mission of bids or proposals that is required by subsection

23 (a)(1). Such limits shall be incorporated in the Federal

24 Acquisition Regulation.’’.
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1 SEC. 8007. ADVOCATE FOR ACQUISITION OF COMMERCIAL

2 AND NONDEVELOPMENTAL ITEMS.

3 (a) ESTABLISHMENT.—The Office of Federal Pro4 curement Policy Act (41 U.S.C. 401 et seq.), as amended

5 by section 8004, is further amended by adding at the end

6 the following:

7 ‘‘ADVOCATE FOR ACQUISITION OF COMMERCIAL AND

8 NONDEVELOPMENTAL ITEMS

9 ‘‘SEC. 34. (a) ESTABLISHMENT.—There is estab10 lished in the Office of Federal Procurement Policy the po11 sition of Advocate for Acquisition of Commercial and

12 Nondevelopmental Items.

13 ‘‘(b) FUNCTIONS.—The Advocate for Acquisition of

14 Commercial and Nondevelopmental Items shall—

15 ‘‘(1) monitor compliance by executive agencies

16 with the preference for the acquisition of commercial

17 and nondevelopmental items that is set forth in sec18 tion 29;

19 ‘‘(2) make recommendations and proposals to

20 the Administrator regarding the reform of procure21 ment statutes and regulations to implement that

22 preference; and

23 ‘‘(3) report to the Administrator on the pro24 spective effect of proposed legislation and regula25 tions on the acquisition of commercial items and

26 nondevelopmental items.
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1 ‘‘(c) REPORT.—The Administrator shall submit to

2 the Committee on Governmental Affairs of the Senate and

3 the Committee on Government Operations of the House

4 of Representatives an annual report describing for the

5 year covered by the report all actions taken by the Office

6 of Federal Procurement Policy to promote the acquisition

7 of commercial items and other nondevelopmental items.’’.

8 (b) RESPONSIBILITIES OF THE ADVOCATE FOR COM9 PETITION.—Section 20(c) of such Act (41 U.S.C. 418(c))

10 is amended to read as follows:

11 ‘‘(c) The advocate for competition for each procuring

12 activity shall be responsible for promoting full and open

13 competition, promoting the acquisition of commercial

14 items and other nondevelopmental items, and challenging

15 barriers to such acquisition, including such barriers as un16 necessarily restrictive statements of need, unnecessarily

17 detailed specifications, and unnecessarily burdensome con18 tract clauses.’’.

19 (c) REPEAL OF SUPERSEDED PROVISION.—Section

20 28 of such Act (41 U.S.C. 424) is repealed.

21 SEC. 8008. PROVISIONS NOT AFFECTED.

22 Nothing in this title shall be construed as amending,

23 modifying, or superseding, or as intended to impair or re24 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) section 8(a) of the Small Business Act (15

10 U.S.C. 637(a)) or any other provision of that Act;

11 or

12 (4) the Act of June 25, 1938 (41 U.S.C. 46–

13 48c), that was revised and reenacted in the Act of

14 June 23, 1971 (85 Stat. 77), popularly referred to

15 as the ‘‘Javits-Wagner-O’Day Act’’.

16 SEC. 8009. COMPTROLLER GENERAL REVIEW OF FEDERAL

17 GOVERNMENT USE OF MARKET RESEARCH.

18 (a) REPORT REQUIRED.—Not later than 2 years

19 after the date of the enactment of this Act, the Comptrol20 ler General of the United States shall submit to the Con21 gress a report on the use of market research by the Fed22 eral Government in support of the procurement of com23 mercial items and nondevelopmental items.

24 (b) CONTENT OF REPORT.—The report shall include

25 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—EFFECTIVE DATE

12 SEC. 9001. EFFECTIVE DATE.

13 Except as otherwise provided in this Act, this Act and

14 the amendments made by this Act shall take effect on the

15 date of the enactment of this Act.

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