II

Calendar No. 476

103D CONGRESS

2D SESSION S. 2206

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

and for other purposes.

IN THE SENATE OF THE UNITED STATES

JUNE 20 (legislative day, JUNE 7), 1994

Mr. NUNN, from the Committee on Armed Services, reported the following

original bill; which was read twice and placed on the calendar

A BILL

To revise and streamline the acquisition laws of the Federal

Government, and for other purposes.

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

3 SECTION 1. SHORT TITLE.

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

5 Streamlining Act of 1994’’.

6 SEC. 2. TABLE OF CONTENTS.

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

TITLE I—CONTRACT FORMATION

Subtitle A—Competition Statutes
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PART I—ARMED SERVICES ACQUISITIONS

SUBPART A—COMPETITION REQUIREMENTS

Sec. 1001. References to Federal Acquisition Regulation.

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

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

full and open competition.

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

Sec. 1005. Acquisition of expert services.

SUBPART B—PLANNING, SOLICITATION, EVALUATION, AND AWARD

Sec. 1011. Source selection factors.

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

Sec. 1013. Prompt notice of award.

Sec. 1014. Post-award debriefings.

Sec. 1015. Protest file.

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

Sec. 1017. Two-phase selection procedures.

SUBPART C—KINDS OF CONTRACTS

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

contract.

Sec. 1022. Technical and conforming amendments.

SUBPART D—MISCELLANEOUS PROVISIONS FOR THE ENCOURAGEMENT OF

COMPETITION

Sec. 1031. Repeal of requirement for annual report by advocates for competition.

PART II—CIVILIAN AGENCY ACQUISITIONS

SUBPART A—COMPETITION REQUIREMENTS

Sec. 1051. References to Federal Acquisition Regulation.

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

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

full and open competition.

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

Sec. 1055. Acquisition of expert services.

Sec. 1056. Continued occupancy of leased space.

SUBPART B—PLANNING, SOLICITATION, EVALUATION, AND AWARD

Sec. 1061. Solicitation, evaluation, and award.

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

Sec. 1063. Prompt notice of award.

Sec. 1064. Post-award debriefings.

Sec. 1065. Protest file.

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

Sec. 1067. Two-phase selection procedures.

SUBPART C—KINDS OF CONTRACTS

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

contract.

Sec. 1072. Multiyear contracting authority.
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Sec. 1073. Severable services contracts crossing fiscal years.

Sec. 1074. Economy Act purchases.

PART III—ACQUISITIONS GENERALLY

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

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

Subtitle B—Truth in Negotiations

PART I—ARMED SERVICES ACQUISITIONS

Sec. 1201. Stabilization of dollar threshold of applicability.

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

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

Sec. 1204. Additional special rules for commercial items.

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

Sec. 1206. Required regulations.

Sec. 1207. Consistency of time references.

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

Sec. 1209. Repeal of superseded provision.

PART II—CIVILIAN AGENCY ACQUISITIONS

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

of cost or pricing data.

Sec. 1252. Repeal of obsolete provision.

Subtitle C—Research and Development

Sec. 1301. Research projects.

Sec. 1302. Elimination of inflexible terminology regarding coordination and

communication of defense research activities.

Subtitle D—Procurement Protests

PART I—PROTESTS TO THE COMPTROLLER GENERAL

Sec. 1401. Protest defined.

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

Sec. 1403. Decisions on protests.

Sec. 1404. Regulations.

PART II—PROTESTS IN THE FEDERAL COURTS

Sec. 1421. Nonexclusivity of remedies.

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

PART III—PROTESTS IN PROCUREMENTS OF AUTOMATIC DATA PROCESSING

Sec. 1431. Revocation of delegations of procurement authority.

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

Appeals.

Sec. 1433. Periods for certain actions.

Sec. 1434. Dismissals of protests.

Sec. 1435. Award of costs.

Sec. 1436. Dismissal agreements.
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Sec. 1437. Jurisdiction of district courts.

Sec. 1438. Matters to be covered in regulations.

Sec. 1439. Definitions.

Subtitle E—Definitions and Other Matters

PART I—ARMED SERVICES ACQUISITIONS

Sec. 1501. Definitions.

Sec. 1502. Delegation of procurement functions.

Sec. 1503. Determinations and decisions.

Sec. 1504. Undefinitized contractual actions: restrictions.

Sec. 1505. Production special tooling and production special test equipment:

contract terms and conditions.

Sec. 1506. Regulations for bids.

PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 1551. Definitions.

Sec. 1552. Delegation of procurement functions.

Sec. 1553. Determinations and decisions.

Sec. 1554. Cooperative purchasing.

TITLE II—CONTRACT ADMINISTRATION

Subtitle A—Contract Payment

PART I—ARMED SERVICES ACQUISITIONS

Sec. 2001. Contract financing.

Sec. 2002. Contracts: vouchering procedures.

PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 2051. Contract financing.

Subtitle B—Cost Principles

PART I—ARMED SERVICES ACQUISITIONS

Sec. 2101. Allowable contract costs.

Sec. 2102. Contract profit controls during emergency periods.

PART II—CIVILIAN AGENCY ACQUISITIONS

Sec. 2151. Allowable contract costs.

PART III—ACQUISITIONS GENERALLY

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
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Sec. 2251. Authority to examine records of contractors.

Subtitle D—Cost Accounting Standards

Sec. 2301. Exceptions to coverage.

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

Cost Accounting Standards Board.

Subtitle E—Administration of Contract Provisions Relating to

Price, Delivery, and Product Quality

PART I—ARMED SERVICES ACQUISITIONS

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

Sec. 2402. Contractor guarantees regarding weapon systems.

PART II—ACQUISITIONS GENERALLY

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

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

Subtitle F—Claims and Disputes

PART I—ARMED SERVICES ACQUISITIONS

Sec. 2501. Certification of contract claims.

Sec. 2502. Shipbuilding claims.

PART II—ACQUISITIONS GENERALLY

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

States Court of Federal Claims.

Sec. 2552. Contract Disputes Act improvements.

Sec. 2553. Extension of alternative dispute resolution authority.

Sec. 2554. Expedited resolution of contract administration complaints.

TITLE III—SERVICE SPECIFIC AND MAJOR SYSTEMS

STATUTES

Subtitle A—Major Systems Statutes

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

Sec. 3002. Enhanced program stability.

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

programs as defense enterprise programs.

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

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

programs.

Subtitle B—Testing Statutes

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

Secretary of Defense.
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Sec. 3012. Responsibility of Director of Operational Test and Evaluation for

live fire testing.

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

test and evaluation.

Subtitle C—Service Specific Laws

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

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

Sec. 3023. Civil Reserve Air Fleet.

Sec. 3024. Exchange of personnel.

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

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

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

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

Register.

Sec. 3029. Naval salvage facilities.

Subtitle D—Department of Defense Commercial and Industrial

Activities

Sec. 3051. Factories and arsenals: manufacture at.

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

Subtitle E—Fuel- and Energy-Related Laws

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

Subtitle F—Fiscal Statutes

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

of another agency of Department of Defense.

Subtitle G—Miscellaneous

Sec. 3081. Obligation of funds: limitation.

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

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

and vehicles.

Sec. 3084. Soft drink supplies for exchange stores.

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

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

LAWS

Subtitle A—Simplified Acquisition Threshold

PART I—ESTABLISHMENT OF THRESHOLD

Sec. 4001. Simplified acquisition threshold.

PART II—SIMPLIFICATION OF PROCEDURES

Sec. 4011. Simplified acquisition procedures.
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Sec. 4012. Small business reservation.

Sec. 4013. Fast payment under simplified acquisition procedures.

Sec. 4014. Procurement notice.

Sec. 4015. Electronic commerce for Federal Government procurements.

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

SIMPLIFIED ACQUISITION THRESHOLD

Sec. 4021. Future enacted procurement laws.

Sec. 4022. Armed services acquisitions.

Sec. 4023. Civilian agency acquisitions.

Sec. 4024. Acquisitions generally.

PART IV—CONFORMING AMENDMENTS

Sec. 4071. Armed services acquisitions.

Sec. 4072. Civilian agency acquisitions.

Sec. 4073. Office of Federal Procurement Policy Act.

Sec. 4074. Small Business Act.

PART V—REVISION OF REGULATIONS

Sec. 4081. Revision required.

Subtitle B—Socioeconomic and Small Business Laws

Sec. 4101. Armed services acquisitions.

Sec. 4102. Acquisitions generally.

Sec. 4103. Acquisitions from small businesses.

Sec. 4104. Contracting program for certain small business concerns.

Subtitle C—Miscellaneous Acquisition Laws

Sec. 4151. Prohibition on use of funds for documenting economic or employment impact of certain acquisition programs.

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

from a particular source.

TITLE V—ACQUISITION MANAGEMENT

Subtitle A—Armed Services Acquisitions

Sec. 5001. Performance based management.

Sec. 5002. Results oriented acquisition program cycle.

Sec. 5003. Defense acquisition pilot program designations.

Subtitle B—Civilian Agency Acquisitions

Sec. 5051. Performance based management.

Sec. 5052. Results-oriented acquisition process.

Subtitle C—Miscellaneous

Sec. 5091. Contractor exceptional performance awards.

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

TITLE VI—STANDARDS OF CONDUCT

Subtitle A—Ethics Provisions
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Sec. 6001. Amendments to Office of Federal Procurement Policy Act.

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

Sec. 6003. Repeal of superseded and obsolete laws.

Sec. 6004. Implementation.

Subtitle B—Additional Amendments

Sec. 6051. Contracting functions performed by Federal personnel.

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

Sec. 6053. Interests of Members of Congress.

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

Subtitle C—Whistleblower Protection

Sec. 6101. Armed services procurements.

Sec. 6102. Governmentwide whistleblower protections for contractor employees.

TITLE VII—DEFENSE TRADE AND COOPERATION

Sec. 7001. Purchases of foreign goods.

Sec. 7002. International cooperative agreements.

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

TITLE VIII—COMMERCIAL ITEMS

Sec. 8001. Definitions.

Sec. 8002. Preference for acquisition of commercial items and

nondevelopmental items.

Sec. 8003. Acquisition of commercial items.

Sec. 8004. Class waiver of applicability of certain laws.

Sec. 8005. Inapplicability of certain provisions of law.

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

Sec. 8007. Advocates for acquisition of commercial and nondevelopmental

items.

Sec. 8008. Provisions not affected.

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

research.

TITLE IX—EFFECTIVE DATES AND IMPLEMENTATION

Sec. 9001. Effective dates.

Sec. 9002. Implementing regulations.

Sec. 9003. Evaluation by the Comptroller General.

Sec. 9004. Data collection through the Federal procurement data system.
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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. ESTABLISHMENT OR MAINTENANCE OF ALTER18 NATIVE SOURCES OF SUPPLY.

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

20 amended—

21 (1) in paragraph (1)—

22 (A) by striking out ‘‘or’’ at the end of sub23 paragraph (B);
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1 (B) by striking out the period at the end

2 of subparagraph (C) and inserting in lieu there3 of a semicolon; and

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

5 subparagraphs:

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

7 a reliable source of supply of such property or serv8 ice;

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

10 property or service determined on the basis of a his11 tory of high demand for the property or service; or

12 ‘‘(F) in the case of medical supplies, safety sup13 plies, or emergency supplies, would satisfy a critical

14 need for such supplies.’’;

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

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

17 (3) by inserting after paragraph (1) the follow18 ing new paragraph (2):

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

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

21 or contracts.’’; and

22 (4) in paragraph (4), as redesignated by para23 graph (2), by striking out ‘‘paragraphs (1) and (2)’’

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

25 (3)’’.
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1 SEC. 1003. CLARIFICATION OF APPROVAL AUTHORITY FOR

2 USE OF PROCEDURES OTHER THAN FULL

3 AND OPEN COMPETITION.

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

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

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

7 (ii), (iii), or (iv)’’.

8 SEC. 1004. TASK ORDER CONTRACTS FOR ADVISORY AND

9 ASSISTANCE SERVICES.

10 (a) AUTHORITY.—

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

12 United States Code, is amended by inserting after

13 section 2304 the following new section:

14 ‘‘§ 2304a. Task order contracts for advisory and as15 sistance services

16 ‘‘(a) AUTHORITY TO AWARD.—(1) Subject to the re17 quirements of this section, the head of an agency may

18 enter into a contract for advisory and assistance services

19 that does not procure or specify a firm quantity of services

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

21 provides for the issuance of task orders during the speci22 fied period of the contract.

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

24 of an agency may enter into a contract described in para25 graph (1) only under the authority of this section.
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1 ‘‘(b) LIMITATION ON CONTRACT PERIOD.—The pe2 riod of a contract referred to in subsection (a), including

3 all periods of extensions of the contract under options,

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

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

6 applicable to such contract.

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

8 agency may use procedures other than competitive proce9 dures to enter into a contract referred to in subsection

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

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

12 procedures is approved in accordance with subsection (f)

13 of such section.

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

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

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

17 shall reasonably and fairly describe the general scope,

18 magnitude, and duration of the proposed contract in a

19 manner that would reasonably enable a potential offeror

20 to decide whether to request the solicitation and consider

21 submitting an offer.

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

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

24 number of options to extend the contract and the pe-
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1 riod for which the contract may be extended under

2 each option, if any.

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

4 services to be procured under the contract.

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

6 other description that reasonably describes the gen7 eral scope, nature, complexity, and purposes of the

8 services to be procured under the contract.

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

10 one solicitation, award separate contracts under this sec11 tion for the same or similar services to two or more

12 sources if the solicitation states that the head of the agen13 cy has the option to do so.

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

15 assistance services to be entered into under the authority

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

17 and the contract amount is estimated to exceed

18 $10,000,000 (including all options), the solicitation

19 shall—

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

21 under subparagraph (A); and

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

23 agency may also elect to award only one contract if

24 the head of the agency determines in writing that
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1 only one of the offerers is capable of providing the

2 services required at the level of quality required.

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

4 of a solicitation for which the head of an agency deter5 mines in writing that, because the services required under

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

7 practicable to award more than one contract.

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

9 contain the same information that is required by para10 graph (3) to be included in the solicitation of offers for

11 that contract.

12 ‘‘(d) ORDER PROCEDURES.—(1) The following ac13 tions are not required for a task order issued under a con14 tract entered into in accordance with this section:

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

16 section 18 of the Office of Federal Procurement Pol17 icy Act (41 U.S.C. 416) or section 8(e) of the Small

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

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

20 competition (or a waiver of competition approved in

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

22 separate from that used for entering into the con23 tract.

24 ‘‘(2)(A) When multiple contracts are awarded pursu25 ant to subsection (c)(4), all contractors awarded such con-
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1 tracts shall be provided a fair opportunity to be consid2 ered, pursuant to procedures set forth in the contracts,

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

4 under any of the contracts unless—

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

6 is of such unusual urgency that competition would

7 result in unacceptable delays in fulfilling the agen8 cy’s needs;

9 ‘‘(ii) only one such contractor is capable of pro10 viding the services required at the level of quality re11 quired because the services ordered are unique or so

12 highly specialized;

13 ‘‘(iii) the task order should be issued on a sole14 source basis in the interest of economy and effi15 ciency because it is a logical follow-on to a task

16 order already issued on a competitive basis; or

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

18 contractor in order to satisfy a minimum guarantee.

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

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

21 work that clearly specifies all tasks to be performed under

22 the order.

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

24 the issuance or proposed issuance of a task order except

25 for a protest on the ground that the order increases the
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1 scope, period, or maximum value of the contract under

2 which the order is issued.

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

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

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

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

7 value of the contract may be increased only by modifica8 tion of the contract.

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

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

11 of section 2304 of this title and approved in accordance

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

13 shall be used for making such a modification.

14 ‘‘(3) Notice regarding the modification shall be pro15 vided in accordance with section 18 of the Office of Fed16 eral Procurement Policy Act (41 U.S.C. 416) and section

17 8(e) of the Small Business Act (15 U.S.C. 637(e)).

18 ‘‘(4)(A) Notwithstanding the limitation on the con19 tract period set forth in subsection (b) or in a solicitation

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

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

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

23 6 months if the agency head determines that—

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

25 delayed by circumstances that were not reasonably
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1 foreseeable at the time the initial contract was en2 tered into; and

3 ‘‘(ii) the extension is necessary in order to en4 sure continuity of the receipt of services pending the

5 award of, and commencement of performance under,

6 the follow-on contract.

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

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

9 with the limitations and requirements of this subsection.

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

11 agency who awards multiple contracts pursuant to sub12 section (c)(4) shall appoint or designate a task order om13 budsman who shall be responsible for reviewing complaints

14 from the contractors on such contracts and ensuring that

15 all of the contractors are afforded a fair opportunity to

16 be considered for task orders when required under sub17 section (d)(2). The task order ombudsman shall be a sen18 ior agency official who is independent of the contracting

19 officer for the contracts and may be the agency’s competi20 tion advocate.

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

22 This section does not apply to a contract for the acquisi23 tion of property or services that includes acquisition of ad24 visory and assistance services if the head of an agency en25 tering into such contract determines that, under the con-
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1 tract, advisory and assistance services are necessarily inci2 dent to, and not a significant component of, the contract.

3 ‘‘(h) RELATIONSHIP TO OTHER CONTRACTING AU4 THORITY.—Nothing in this section may be construed to

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

6 single or multiple task order contracts, or single or mul7 tiple delivery order contracts, for property or services

8 (other than advisory and assistance services) under other

9 provisions of this chapter or under any other provision of

10 law.

11 ‘‘(i) ADVISORY AND ASSISTANCE SERVICES DE12 FINED.—In this section, the term ‘advisory and assistance

13 services’ has the meaning given such term in section

14 1105(g) of title 31.’’.

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 order contracts for advisory and assistance services.’’.

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 SEC. 1005. ACQUISITION OF EXPERT SERVICES.

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

3 is amended—

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

5 lieu thereof ‘‘(B)’’; and

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

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

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

9 any reasonably foreseeable litigation or dispute) in10 volving the Federal Government, in any trial, hear11 ing, or proceeding before any court, administrative

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

13 dispute resolution process, whether or not the expert

14 is expected to testify’’.

15 Subpart B—Planning, Solicitation, Evaluation, and

16 Award

17 SEC. 1011. SOURCE SELECTION FACTORS.

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

19 amended—

20 (1) in paragraph (2)—

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

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

23 thereof ‘‘nonprice-related factors and

24 subfactors)’’; and
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1 (B) in subparagraph (B)(ii), by striking

2 out subclause (I) and inserting in lieu thereof

3 the following:

4 ‘‘(I) either a statement that the pro5 posals are intended to be evaluated with,

6 and award made after, discussions with the

7 offerors, or a statement that the proposals

8 are intended to be evaluated, and award

9 made, without discussions with the offerors

10 (other than discussions conducted for the

11 purpose of minor clarification) unless dis12 cussions are determined to be necessary;

13 and’’; and

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

15 in lieu thereof the following:

16 ‘‘(3)(A) In prescribing the evaluation factors to be

17 included in each solicitation for competitive proposals, the

18 head of an agency—

19 ‘‘(i) shall clearly establish the relative impor20 tance assigned to the evaluation factors and

21 subfactors, including the quality of the product or

22 services to be provided (including technical capabil23 ity, management capability, prior experience, and

24 past performance of the offeror);
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1 ‘‘(ii) shall include cost or price to the Govern2 ment as an evaluation factor that must be consid3 ered in the evaluation of proposals; and

4 ‘‘(iii) shall disclose to offerors whether all eval5 uation factors other than cost or price, when com6 bined, are—

7 ‘‘(I) significantly more important than cost

8 or price;

9 ‘‘(II) approximately equal in importance to

10 cost or price; or

11 ‘‘(III) significantly less important than

12 cost or price.

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

14 from—

15 ‘‘(i) providing additional information in a solici16 tation, including numeric weights for all evaluation

17 factors; or

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

19 made to the offeror that meets the solicitation’s

20 mandatory requirements at the lowest cost or

21 price.’’.

22 SEC. 1012. SOLICITATION PROVISION REGARDING EVALUA23 TION OF PURCHASE OPTIONS.

24 (a) OPTIONS FOR ADDITIONAL PURCHASES.—Sub25 section (a) of section 2305 of title 10, United States Code,
22

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

2 at the end the following new paragraph:

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

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

5 may not include in such solicitation a clause providing for

6 the evaluation of prices for options to purchase additional

7 property or services under the contract unless the head

8 of the agency has determined that there is a reasonable

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

10 (b) REPEAL OF SUPERSEDED PROVISION.—Section

11 2301(a) of such title is amended—

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

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

14 (5); and

15 (3) by striking out ‘‘; and’’ at the end of para16 graph (6) and inserting in lieu thereof a period.

17 SEC. 1013. PROMPT NOTICE OF AWARD.

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

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

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

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

22 accordance with procedures prescribed in the Federal Ac23 quisition Regulation, notify all offerors not awarded the

24 contract that the contract has been awarded.’’.
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1 (b) COMPETITIVE PROPOSALS PROCEDURES.—Sec2 tion 2305(b)(4)(B) of title 10, United States Code, is

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

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

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

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

7 procedures prescribed in the Federal Acquisition Regula8 tion, notify’’.

9 SEC. 1014. POST-AWARD DEBRIEFINGS.

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

11 amended—

12 (1) by redesignating paragraph (5) as para13 graph (6); and

14 (2) by inserting after paragraph (4) the follow15 ing new paragraph (5):

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

17 an agency on the basis of competitive proposals, an unsuc18 cessful offeror, upon written request received by the agen19 cy within 3 days after the date on which the unsuccessful

20 offeror receives the notification of the contract award,

21 shall be debriefed and furnished the basis for the selection

22 decision and contract award. An employee of the agency

23 shall debrief the offeror promptly after receipt of the re24 quest by the agency.

25 ‘‘(B) The debriefing shall include, at a minimum—
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1 ‘‘(i) the agency’s evaluation of the significant

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

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

4 rating of the offer of the contractor awarded the

5 contract and the overall evaluated cost and technical

6 rating of the offer of the debriefed offeror;

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

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

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

10 equipment that is a commercial item, the make and

11 model of the item incorporated in the offer of the

12 contractor awarded the contract; and

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

14 the debriefed offeror as to whether source selection

15 procedures set forth in the solicitation, applicable

16 regulations, and other applicable authorities were

17 followed by the agency.

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

19 comparisons of the debriefed offeror’s offer with other of20 fers and may not disclose any information that is exempt

21 from disclosure under section 552 of title 5, including in22 formation relating to—

23 ‘‘(i) trade secrets;

24 ‘‘(ii) privileged or confidential manufacturing

25 processes and techniques; and
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1 ‘‘(iii) commercial and financial information that

2 is privileged or confidential, including cost break3 downs, profit, indirect cost rates, and similar infor4 mation.

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

6 include a statement that information described in subpara7 graph (B) may be disclosed in post-award debriefings.

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

9 award and as a result of a successful procurement protest

10 or otherwise, the agency seeks to fulfill the requirement

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

12 of offers or on the basis of new best and final offers re13 quested for that contract, the agency shall make available

14 to all offerors—

15 ‘‘(i) the information provided in debriefings

16 under this paragraph regarding the offer of the con17 tractor awarded the contract; and

18 ‘‘(ii) the comparable debriefing information that

19 was prepared with respect to the original offerors.

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

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

22 SEC. 1015. PROTEST FILE.

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

24 amended by adding at the end the following:
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1 ‘‘(e)(1) If, in the case of a solicitation for a contract

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

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

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

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

6 the protest shall be established by the procuring activity

7 and reasonable access shall be provided to actual or pro8 spective offerors.

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

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

11 pursuant to paragraph (1) unless an applicable protective

12 order provides otherwise.

13 ‘‘(3) Regulations implementing this subsection shall

14 be consistent with the regulations regarding the prepara15 tion and submission of an agency’s protest file (the so16 called ‘rule 4 file’) for protests to the General Services

17 Board of Contract Appeals under section 111 of the Fed18 eral Property and Administrative Services Act of 1949 (41

19 U.S.C. 759).’’.

20 SEC. 1016. AWARD OF COSTS AND FEES IN AGENCY SETTLE21 MENT OF PROTESTS.

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

23 amended by section 1015, is further amended by adding

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

2 agency determines that a solicitation, proposed award, or

3 award does not comply with the requirements of law or

4 regulation, the head of the agency may take—

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

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

7 title 31; and

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

9 of section 3554(c) of title 31 within the limits re10 ferred to in paragraph (2) of such section.’’.

11 SEC. 1017. TWO-PHASE SELECTION PROCEDURES.

12 (a) PROCEDURES AUTHORIZED.—Chapter 137 of

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

14 section 2305 the following new section:

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

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

17 agency may use two-phase selection procedures for enter18 ing into a contract for the acquisition of property or serv19 ices when the head of the agency determines that three

20 or more offers will be received for such contract, substan21 tial design work must be performed before an offeror can

22 develop a price or cost proposal for such contract, and the

23 offerors will incur a substantial amount of expenses in pre24 paring the offers.
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1 ‘‘(b) PROCEDURES DESCRIBED.—Two-phase selec2 tion procedures consist of the following:

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

4 that—

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

6 ‘‘(i) technical approach; and

7 ‘‘(ii) technical qualifications; and

8 ‘‘(B) do not include—

9 ‘‘(i) detailed design information; or

10 ‘‘(ii) cost or price information.

11 ‘‘(2) The head of the agency evaluates the pro12 posals on the basis of evaluation criteria set forth in

13 the solicitation, except that the head of the agency

14 does not consider cost-related or price-related eval15 uation factors.

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

17 three offerors as the most highly qualified to provide

18 the property or services under the contract and re19 quests the selected offerors to submit competitive

20 proposals that include cost or price information.

21 ‘‘(4) The head of the agency awards the con22 tract in accordance with section 2305(b)(4) of this

23 title.

24 ‘‘(c) RESOURCE COMPARISON CRITERION RE25 QUIRED.—In using two-phase selection procedures for en-
29

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1 tering into a contract, the head of the agency shall estab2 lish a resource criterion or a financial criterion applicable

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

4 comparing the offerors and their proposals.

5 ‘‘(d) TWO-PHASE SELECTION PROCEDURES DE6 FINED.—In this section, the term ‘two-phase selection pro7 cedures’ means procedures described in subsection (b) that

8 are used for the selection of a contractor on the basis of

9 cost or price and other evaluation criteria to provide prop10 erty or services in accordance with the provisions of a con11 tract which requires the contractor to design the property

12 to be acquired under the contract and produce or con13 struct such property.

14 ‘‘(e) APPLICABILITY ONLY TO DEPARTMENT OF DE15 FENSE.—This section does not apply to the Coast Guard

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

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

18 at the beginning of such chapter is amended by inserting

19 after the item relating to section 2305 the following:

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

20 Subpart C—Kinds of Contracts

21 SEC. 1021. SECRETARIAL DETERMINATION REGARDING

22 USE OF COST TYPE OR INCENTIVE CON23 TRACT.

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

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

2 (a) REPEAL OF UNNECESSARY CROSS REF3 ERENCE.—Subsection (f) of section 2306 of title 10, Unit4 ed States Code, is repealed.

5 (b) CONFORMING AMENDMENT.—Such section is

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

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

8 (c) NEUTERIZATION OF REFERENCE.—Subsection

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

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

11 ‘‘whenever he finds’’ and inserting in lieu thereof ‘‘when12 ever the head of the agency finds’’.

13 Subpart D—Miscellaneous Provisions for the

14 Encouragement of Competition

15 SEC. 1031. REPEAL OF REQUIREMENT FOR ANNUAL RE16 PORT BY ADVOCATES FOR COMPETITION.

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

18 States Code, is repealed.

19 PART II—CIVILIAN AGENCY ACQUISITIONS

20 Subpart A—Competition Requirements

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

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

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

26 ‘‘modifications’’ and all that follows through ‘‘of
31

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1 1984’’ and inserting in lieu thereof ‘‘Federal Acqui2 sition Regulation’’; and

3 (2) in subsection (g)(1), by striking out ‘‘regu4 lations modified’’ and all that follows through ‘‘of

5 1984,’’ and inserting in lieu thereof ‘‘Federal Acqui6 sition Regulation’’.

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

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

12 (1) in paragraph (1)—

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

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

16 of subparagraph (C) and inserting in lieu there17 of a semicolon; and

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

19 subparagraphs:

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

21 a reliable source of supply of such property or serv22 ice;

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

24 property or service determined on the basis of a his25 tory of high demand for the property or service; or
32

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1 ‘‘(F) in the case of medical supplies, safety sup2 plies, or emergency supplies, would satisfy a critical

3 need for such supplies.’’;

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

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

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

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

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

10 or contracts.’’; and

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

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

14 (3)’’.

15 SEC. 1053. CLARIFICATION OF APPROVAL AUTHORITY FOR

16 USE OF PROCEDURES OTHER THAN FULL

17 AND OPEN COMPETITION.

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

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

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

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

2 ASSISTANCE SERVICES.

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

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

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

6 following new section:

7 ‘‘TASK ORDER CONTRACTS FOR ADVISORY AND

8 ASSISTANCE SERVICES

9 ‘‘SEC. 303H. (a) AUTHORITY TO AWARD.—(1) Sub10 ject to the requirements of this section, the head of an

11 executive agency may enter into a contract for advisory

12 and assistance services that does not procure or specify

13 a firm quantity of services (other than a minimum or max14 imum quantity) and that provides for the issuance of task

15 orders during the specified period of the contract.

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

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

18 only under the authority of this section.

19 ‘‘(b) LIMITATION ON CONTRACT PERIOD.—The 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 5 years unless

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

24 applicable to such contract.

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

26 may use procedures other than competitive procedures to
34

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

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

3 the contract and the use of such procedures is approved

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

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

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

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

8 shall reasonably and fairly describe the general scope,

9 magnitude, and duration of the proposed contract in a

10 manner that would reasonably enable a potential offeror

11 to decide whether to request the solicitation and consider

12 submitting an offer.

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

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

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

17 each option, if any.

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

19 the services to be procured under the contract.

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

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

23 services to be procured under the contract.

24 ‘‘(4)(A) An agency head may, on the basis of one so25 licitation, award separate contracts under this section for
35

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

2 solicitation states that the agency head has the option to

3 do so.

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

5 assistance services to be entered into under the authority

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

7 and the contract amount is estimated to exceed

8 $10,000,000 (including all options), the solicitation

9 shall—

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

11 under subparagraph (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 ‘‘(C) Subparagraph (B) does not apply in the case

18 of a solicitation for which the agency head determines in

19 writing that, because the services required under the con20 tract are unique or highly specialized, it is not practicable

21 to award more than one contract.

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) ORDER PROCEDURES.—(1) The following ac2 tions are not required for a task order issued under a con3 tract 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 303(f)) that is separate

11 from that used for entering into the contract.

12 ‘‘(2)(A) When multiple contracts are awarded pursu13 ant to subsection (c)(4), all contractors awarded such con14 tracts shall be provided a fair opportunity to be consid15 ered, pursuant to procedures set forth in the contracts,

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

17 under any of the contracts unless—

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

19 is of such unusual urgency that competition would

20 result in unacceptable delays in fulfilling the agen21 cy’s needs;

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

25 highly specialized;
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1 ‘‘(iii) the task order should be issued on a sole2 source basis in the interest of economy and effi3 ciency because it is a logical follow-on to a task

4 order already issued on a competitive basis; or

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

6 contractor in order to satisfy a minimum guarantee.

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

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

9 work that clearly specifies all tasks to be performed under

10 the order.

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

12 the issuance or proposed issuance of a task order except

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

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

15 which the order is issued.

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

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

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

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

20 value of the contract may be increased only by modifica21 tion of the contract.

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

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

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

2 for making such a modification.

3 ‘‘(3) Notice regarding the modification shall be pro4 vided in accordance with section 18 of the Office of Fed5 eral Procurement Policy Act (41 U.S.C. 416) and section

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

7 ‘‘(4)(A) Notwithstanding the limitation on the con8 tract period set forth in subsection (b) or in a solicitation

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

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

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

12 6 months if the agency head determines that—

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

14 delayed by circumstances that were not reasonably

15 foreseeable at the time the initial contract was en16 tered into; and

17 ‘‘(ii) the extension is necessary in order to en18 sure continuity of the receipt of services pending the

19 award of, and commencement of performance under,

20 the follow-on contract.

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

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

23 with the limitations and requirements of this subsection.

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

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

2 who shall be responsible for reviewing complaints from the

3 contractors on such contracts and ensuring that all of the

4 contractors are afforded a fair opportunity to be consid5 ered for task orders when required under subsection

6 (d)(2). The task order ombudsman shall be a senior agen7 cy official who is independent of the contracting officer

8 for the contracts and may be the agency’s competition ad9 vocate.

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

11 This section does not apply to a contract for the acquisi12 tion of property or services that includes acquisition of ad13 visory and assistance services if the agency head entering

14 into such contract determines that, under the contract, ad15 visory and assistance services are necessarily incident to,

16 and not a significant component of, the contract.

17 ‘‘(h) RELATIONSHIP TO OTHER CONTRACTING AU18 THORITY.—Nothing in this section may be construed to

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

20 single or multiple task order contracts, or single or mul21 tiple delivery order contracts, for goods or services (other

22 than advisory and assistance services) under other provi23 sions of this title or under any other provision of law.

24 ‘‘(i) ADVISORY AND ASSISTANCE SERVICES DE25 FINED.—In this section, the term ‘advisory and assistance
40

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1 services’ has the meaning given such term in section

2 1105(g) of title 31, United States Code.’’.

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

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

5 relating to section 303G the following new item:

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

6 SEC. 1055. ACQUISITION OF EXPERT SERVICES.

7 (a) EXCEPTION TO REQUIREMENT FOR USE OF COM8 PETITIVE PROCEDURES.—Section 303(c)(3) of the Fed9 eral Property and Administrative Services Act of 1949 (41

10 U.S.C. 253(c)) is amended—

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

12 lieu thereof ‘‘(B)’’; and

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

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

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

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

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

20 dispute resolution process, whether or not the expert

21 is expected to testify’’.

22 (b) PROCUREMENT NOTICE.—

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

2 416(c)) is amended—

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

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

6 of subparagraph (E) and inserting in lieu there7 of ‘‘; or’’; and

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

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

10 expert for use in any litigation or dispute (including

11 any reasonably foreseeable litigation or dispute) in12 volving the Federal Government in any trial, hear13 ing, or proceeding before any court, administrative

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

15 dispute resolution process, whether or not the expert

16 is expected to testify.’’.

17 (2) AMENDMENT OF SMALL BUSINESS ACT.—

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

19 637(c)) is amended—

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

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

23 of subparagraph (E) and inserting in lieu there24 of ‘‘; or’’; and

25 (C) by adding at the end the following:
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1 ‘‘(F) the procurement is for the services of an

2 expert for use in any litigation or dispute (including

3 preparation for any foreseeable litigation or dispute)

4 that involves or could involve the Federal Govern5 ment in any trial, hearing, or proceeding before any

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

7 part of an alternative dispute resolution process,

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

9 (c) REPEAL OF AMENDMENTS TO UNCODIFIED

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

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

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

13 quotes in that section.

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

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

16 that section.

17 SEC. 1056. CONTINUED OCCUPANCY OF LEASED SPACE.

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

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

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

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

3 for the purpose of providing for continued occupancy of

4 particular space in leased real property by a Federal agen5 cy, space may be treated as being available only from the

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

7 of procedures other than competitive procedures (without

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

9 a written determination is made by the contracting officer

10 that—

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

12 for the space;

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

14 and

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

16 the space at a fair market price determined by the

17 contracting officer on the basis of a market survey

18 or an appraisal conducted in accordance with gen19 erally accepted real property appraisal standards.

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

21 procedures other than competitive procedures to enter into

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

23 provide for continued occupancy of particular space in real

24 property by a particular Federal agency. The period of

25 such follow-on lease may not exceed 5 years.
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1 ‘‘(C) Nothing in this paragraph may be construed to

2 prohibit the use of procedures other than competitive pro3 cedures to enter into a follow-on lease of real property for

4 continued occupancy of particular space in real property

5 by a Federal agency when an exception set forth in sub6 section (c) applies and the use of such procedures is justi7 fied and approved in accordance with subsection (f).’’.

8 Subpart B—Planning, Solicitation, Evaluation, and

9 Award

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

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

12 the Federal Property and Administrative Services Act of

13 1949 (41 U.S.C. 253a) is amended—

14 (1) in subsection (b)(1)(A)—

15 (A) by inserting ‘‘and significant

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

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

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

19 or price-related factors and subfactors, and

20 noncost-related or nonprice-related factors and

21 subfactors)’’;

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

23 subfactors’’ after ‘‘factors’’;

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

25 clause (i) and inserting in lieu thereof the following:
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1 ‘‘(i) either a statement that the pro2 posals are intended to be evaluated with,

3 and award made after, discussions with the

4 offerors, or a statement that the proposals

5 are intended to be evaluated, and award

6 made, without discussions with the offerors

7 (other than discussions conducted for the

8 purpose of minor clarification) unless dis9 cussions are determined to be necessary;

10 and’’; and

11 (4) by adding at the end the following new sub12 section:

13 ‘‘(c)(1) In prescribing the evaluation factors to be in14 cluded in each solicitation for competitive proposals, an

15 agency head—

16 ‘‘(A) shall clearly establish the relative impor17 tance assigned to the evaluation factors and

18 subfactors, including the quality of the product or

19 services to be provided (including technical capabil20 ity, management capability, prior experience, and

21 past performance of the offeror);

22 ‘‘(B) shall include cost or price to the Govern23 ment as an evaluation factor that must be consid24 ered in the evaluation of proposals; and
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1 ‘‘(C) shall disclose to offerors whether all eval2 uation factors other than cost or price, when com3 bined, are—

4 ‘‘(i) significantly more important than cost

5 or price;

6 ‘‘(ii) approximately equal in importance to

7 cost or price; or

8 ‘‘(iii) significantly less important than cost

9 or price.

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

11 from—

12 ‘‘(A) providing additional information in a solic13 itation, including numeric weights for all evaluation

14 factors; or

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

16 made to the offeror that meets the solicitation’s

17 mandatory requirements at the lowest price or

18 cost.’’.

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

20 Federal Property and Administrative Services Act of 1949

21 (41 U.S.C. 253b) is amended—

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

23 a contract,’’ after ‘‘competitive proposals’’;
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1 (2) in subsection (c), by inserting ‘‘in accord2 ance with subsection (a)’’ in the second sentence

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

4 (3) in subsection (d)—

5 (A) by striking out paragraph (1) and in6 serting in lieu thereof the following:

7 ‘‘(1) An agency head shall evaluate competitive pro8 posals in accordance with subsection (a) and may award

9 a contract—

10 ‘‘(A) after discussions with the offerors, pro11 vided that written or oral discussions have been con12 ducted with all responsible offerors who submit pro13 posals within the competitive range; or

14 ‘‘(B) based on the proposals received and with15 out discussions with the offerors (other than discus16 sions conducted for the purpose of minor clarifica17 tion), provided that, as required by section

18 303A(b)(2)(B)(i), the solicitation included a state19 ment that proposals are intended to be evaluated,

20 and award made, without discussions, unless discus21 sions are determined to be necessary.’’;

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

23 and by redesignating paragraph (4) as para24 graph (2); and
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1 (C) in paragraph (2), as redesignated by

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

3 ‘‘price’’ in the first sentence.

4 (c) APPLICABILITY.—

5 (1) IN GENERAL.—Except as provided in para6 graph (2), the amendments made by this section

7 shall apply to—

8 (A) solicitations for sealed bids or competi9 tive proposals issued after the end of the 180-

10 day period beginning on the date of the enact11 ment of this Act; and

12 (B) contracts awarded pursuant to those

13 solicitations.

14 (2) AUTHORITY TO APPLY AMENDMENTS

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

16 the amendments made by this section to solicitations

17 issued before the end of the period referred to in

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

19 shall publish in the Federal Register notice of any

20 such earlier date of application at least 10 days be21 fore that date.

22 SEC. 1062. SOLICITATION PROVISION REGARDING EVALUA23 TION OF PURCHASE OPTIONS.

24 Section 303A of the Federal Property and Adminis25 trative Services Act of 1949 (41 U.S.C. 253a), as amend-
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1 ed by section 1061(a)(4), is further amended by adding

2 at the end the following new subsection:

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

4 contract to be awarded using sealed bid procedures, may

5 not include in such solicitation a clause providing for the

6 evaluation of prices for options to purchase additional

7 property or services under the contract unless the agency

8 head has determined that there is a reasonable likelihood

9 that the options will be exercised.’’.

10 SEC. 1063. PROMPT NOTICE OF AWARD.

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

12 section 303B of the Federal Property and Administrative

13 Services Act of 1949 (41 U.S.C. 253b) is amended by add14 ing at the end the following: ‘‘As soon as practicable after

15 the date of contract award, the agency head shall, in ac16 cordance with procedures prescribed in the Federal Acqui17 sition Regulation, notify all offerors not awarded the con18 tract that the contract has been awarded.’’.

19 (b) COMPETITIVE PROPOSALS PROCEDURES.—Para20 graph (2) of section 303B(d) of the Federal Property and

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

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

23 the second sentence by striking out ‘‘source and shall

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

25 soon as practicable after the date of contract award, the
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1 agency head shall, in accordance with procedures pre2 scribed in the Federal Acquisition Regulation, 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 the head of

12 an executive agency on the basis of competitive proposals,

13 an unsuccessful offeror, upon written request received by

14 the agency within 3 days after the date on which the un15 successful offeror receives the notification of the contract

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

17 selection decision and contract award. An employee of the

18 executive agency shall debrief the offeror promptly after

19 receipt of the request by the agency.

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

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

22 significant weak or deficient factors in the offeror’s

23 offer;

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

25 rating of the offer of the contractor awarded the
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1 contract and the overall evaluated cost and technical

2 rating of the offer of the debriefed offeror;

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

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

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

6 equipment that is a commercial item, the make and

7 model of the item incorporated in the offer of the

8 contractor awarded the contract; and

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

10 the debriefed offeror as to whether source selection

11 procedures set forth in the solicitation, applicable

12 regulations, and other applicable authorities were

13 followed by the executive agency.

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

15 comparisons of the debriefed offeror’s offer with other of16 fers and may not disclose any information that is exempt

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

18 Code, including information relating to—

19 ‘‘(A) trade secrets;

20 ‘‘(B) privileged or confidential manufacturing

21 processes and techniques; and

22 ‘‘(C) commercial and financial information that

23 is privileged or confidential, including cost break24 downs, profit, indirect cost rates, and similar infor25 mation.
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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 new best and final

9 offers requested for that contract, the agency head shall

10 make available to all offerors—

11 ‘‘(A) the information provided in debriefings

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

14 ‘‘(B) the comparable debriefing information

15 that was prepared with respect to the original

16 offerors.

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

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

19 SEC. 1065. PROTEST FILE.

20 Section 303B of the Federal Property and Adminis21 trative Services Act of 1949 (41 U.S.C. 253b), as amend22 ed by section 1064(1), is further amended by adding at

23 the end the following:

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

25 issued by, or an award or proposed award of a contract
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1 by, an agency head, a protest is filed pursuant to the pro2 cedures in subchapter V of chapter 35 of title 31, United

3 States Code, and an actual or prospective offeror so re4 quests, a file of the protest shall be established by the pro5 curing activity and reasonable access shall be provided to

6 actual or prospective offerors.

7 ‘‘(2) Information exempt from disclosure under sec8 tion 552 of title 5, United States Code, may be redacted

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

10 applicable protective order provides otherwise.

11 ‘‘(3) Regulations implementing this subsection shall

12 be consistent with the regulations regarding the prepara13 tion and submission of an agency’s protest file (the so14 called ‘rule 4 file’) for protests to the General Services

15 Board of Contract Appeals under section 111 of the Fed16 eral Property and Administrative Services Act of 1949 (41

17 U.S.C. 759).’’.

18 SEC. 1066. AWARD OF COSTS AND FEES IN AGENCY SETTLE19 MENT OF PROTESTS.

20 Section 303B of the Federal Property and Adminis21 trative Services Act of 1949 (41 U.S.C. 253b), as amend22 ed by section 1065, is further amended by adding at the

23 end the following new subsection:

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

25 determines that a solicitation, proposed award, or award
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1 does not comply with the requirements of law or regula2 tion, the agency head may take—

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

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

5 title 31, United States Code; and

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

7 of section 3554(c) of such title within the limits re8 ferred to in paragraph (2) of such section.’’.

9 SEC. 1067. TWO-PHASE SELECTION PROCEDURES.

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

11 Federal Property and Administrative Services Act of 1949

12 (41 U.S.C. 251 et seq.), as amended by section 1054, is

13 further amended by inserting after section 303H the fol14 lowing new section:

15 ‘‘TWO-PHASE SELECTION PROCEDURES

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

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

18 procedures for entering into a contract for the acquisition

19 of property or services when the agency head determines

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

21 substantial design work must be performed before an

22 offeror can develop a price or cost proposal for such con23 tract, and the offerors will incur a substantial amount of

24 expenses in preparing the offers.

25 ‘‘(b) PROCEDURES DESCRIBED.—Two-phase selec26 tion procedures consist of the following:
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1 ‘‘(1) The agency head solicits proposals that—

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

3 ‘‘(i) technical approach; and

4 ‘‘(ii) technical qualifications; and

5 ‘‘(B) do not include—

6 ‘‘(i) detailed design information; or

7 ‘‘(ii) cost or price information.

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

9 on the basis of evaluation criteria set forth in the so10 licitation, except that the agency head does not con11 sider cost-related or price-related evaluation factors.

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

13 offerors as the most highly qualified to provide the

14 property or services under the contract and requests

15 the selected offerors to submit competitive proposals

16 that include cost or price information.

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

18 accordance with section 303B(d).

19 ‘‘(c) RESOURCE COMPARISON CRITERION RE20 QUIRED.—In using two-phase selection procedures for en21 tering into a contract, the agency head shall establish a

22 resource criterion or a financial criterion applicable to the

23 contract in order to provide a consistent basis for compar24 ing the offerors and their proposals.
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1 ‘‘(d) TWO-PHASE SELECTION PROCEDURES DE2 FINED.—In this section, the term ‘two-phase selection pro3 cedures’ means procedures described in subsection (b) that

4 are used for the selection of a contractor on the basis of

5 cost or price and other evaluation criteria to provide prop6 erty or services in accordance with the provisions of a con7 tract which requires the contractor to design the property

8 to be acquired under the contract and produce or con9 struct such property.’’.

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

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

12 1054, is further amended by inserting after the item relat13 ing to section 303H the following new item:

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

14 Subpart C—Kinds of Contracts

15 SEC. 1071. AGENCY HEAD DETERMINATION REGARDING

16 USE OF COST TYPE OR INCENTIVE CON17 TRACT.

18 Section 304(b) of the Federal Property and Adminis19 trative Services Act of 1949 (41 U.S.C. 254(b)) is amend20 ed by striking out the second sentence.

21 SEC. 1072. MULTIYEAR CONTRACTING AUTHORITY.

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

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

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

25 by inserting after section 303I the following new section:
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1 ‘‘MULTIYEAR CONTRACTS

2 ‘‘SEC. 303J. (a) AUTHORITY.—The head of an execu3 tive agency may enter into a multiyear contract for the

4 acquisition of property or services if—

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

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

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

8 and for the estimated costs associated with any nec9 essary termination of such contract; and

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

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

12 is reasonably firm and continuing over the pe13 riod of the contract; and

14 ‘‘(B) a multiyear contract will serve the

15 best interests of the United States by encourag16 ing effective competition or promoting economy

17 in administration, performance, and operation

18 of the agency’s programs.

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

20 entered into under the authority of this section shall in21 clude a clause that provides that the contract shall be ter22 minated if funds are not made available for the continu23 ation of such contract in any fiscal year covered by the

24 contract. Amounts available for paying termination costs
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1 shall remain available for such purpose until the costs as2 sociated with termination of the contract are paid.

3 ‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sec4 tion is intended to modify or affect any other provision

5 of law that authorizes multiyear contracts.’’.

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

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

8 1067, is further amended by inserting after the item relat9 ing to section 303I the following new item:

‘‘Sec. 303J. Multiyear contracts.’’.

10 SEC. 1073. SEVERABLE SERVICES CONTRACTS CROSSING

11 FISCAL YEARS.

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

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

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

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

16 ‘‘SEVERABLE SERVICES CONTRACTS FOR PERIODS

17 CROSSING FISCAL YEARS

18 ‘‘SEC. 303K. (a) AUTHORITY.—The head of an exec19 utive agency may enter into a severable contract for pro20 curement of services for a period that begins in one fiscal

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

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

23 contract period does not exceed one year.

24 ‘‘(b) AVAILABILITY OF FUNDS.—To the extent pro25 vided in appropriations Acts, funds obligated for a con-
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1 tract entered into under the authority of subsection (a)

2 shall remain available until no longer needed to pay for

3 such contract.

4 ‘‘(c) SEVERABLE CONTRACT DEFINED.—In this sec5 tion, the term ‘severable contract’ means a contract that

6 contains a clause that makes the effectiveness of the con7 tract for periods after the end of the fiscal year in which

8 the performance of the contract begins subject to the

9 availability of appropriations.’’.

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

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

12 1072, is further amended by inserting after the item relat13 ing to section 303J the following new item:

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

14 SEC. 1074. ECONOMY ACT PURCHASES.

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

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

17 Federal Acquisition Regulation shall be revised to include

18 regulations governing the exercise of the authority under

19 section 1535 of title 31, United States Code, for Federal

20 agencies to purchase goods and services under contracts

21 entered into or administered by other agencies.

22 (b) CONTENT OF REGULATIONS.—The regulations

23 prescribed pursuant to subsection (a) shall—

24 (1) require that each purchase described in sub25 section (a) be approved in advance by a contracting
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1 officer of the ordering agency with authority to con2 tract for the goods or services to be purchased or by

3 another official in a position specifically designated

4 by regulation to approve such purchase;

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

6 services may be made only if—

7 (A) the purchase is appropriately made

8 under a contract that the agency filling the pur9 chase order entered into, before the purchase

10 order, in order to meet the requirements of

11 such agency for the same or similar goods or

12 services;

13 (B) the agency filling the purchase order is

14 better qualified to enter into or administer the

15 contract for such goods or services by reason of

16 capabilities or expertise that is not available

17 within the ordering agency; or

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

19 specifically authorized by law or regulations to

20 purchase such goods or services on behalf of

21 other agencies;

22 (3) prohibit any such purchase under a contract

23 or other agreement entered into or administered by

24 an agency not covered by the provisions of chapter

25 137 of title 10, United States Code, or title III of
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1 the Federal Property and Administrative Services

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

3 by the Federal Acquisition Regulation unless the

4 purchase is approved in advance by the senior pro5 curement official responsible for purchasing by the

6 ordering agency; and

7 (4) prohibit any payment to the agency filling

8 a purchase order of any fee that exceeds the actual

9 cost or, if the actual cost is not known, the esti10 mated cost of entering into and administering the

11 contract or other agreement under which the order

12 is filled.

13 (c) MONITORING SYSTEM REQUIRED.—The Adminis14 trator for Federal Procurement Policy shall ensure that,

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

16 of this Act, systems for collecting and evaluating procure17 ment data are capable of collecting and evaluating appro18 priate data on procurements conducted under the regula19 tions prescribed pursuant to subsection (a).

20 (d) TERMINATION.—This section shall cease to be ef21 fective one year after the date on which final regulations

22 prescribed pursuant to subsection (a) take effect.
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1 PART III—ACQUISITIONS GENERALLY

2 SEC. 1091. POLICY REGARDING CONSIDERATION OF CON3 TRACTOR PAST PERFORMANCE.

4 (a) POLICY.—Section 2 of the Office of Federal Pro5 curement Policy Act (41 U.S.C. 401) is amended—

6 (1) by striking out ‘‘and’’ at the end of para7 graph (12);

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

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

10 and

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

12 paragraph:

13 ‘‘(14) establishing policies and procedures that

14 encourage the consideration of contractors’ past per15 formance in the selection of contractors.’’.

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

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

18 amended by adding at the end the following:

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

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

21 one of the relevant factors that contracting officials

22 of executive agencies should consider in entering into

23 contracts.

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

25 to consider past contract performance of an offeror

26 as an indicator of the likelihood that the offeror will
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1 successfully perform a contract to be entered into by

2 that official.

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

4 agencies guidance regarding consideration of the past con5 tract performance of offerors in awarding contracts. The

6 guidance shall include—

7 ‘‘(A) standards for evaluating past performance

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

9 compliance with technical or functional specifica10 tions, and other relevant performance factors that

11 facilitate consistent and fair evaluation by all execu12 tive agencies;

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

14 of information on past contract performance that, to

15 the maximum extent practicable, facilitate auto16 mated collection, maintenance, and dissemination of

17 information and provide for ease of collection, main18 tenance, and dissemination of information by other

19 methods, as necessary; and

20 ‘‘(C) policies for ensuring that offerors are af21 forded an opportunity to submit information on past

22 contract performance and that information submit23 ted by offerors is considered.

24 ‘‘(3) The Administrator shall prescribe for all execu25 tive agencies the policy regarding the period for which in-
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1 formation on past performance of offerors may be main2 tained and considered.

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

4 is no information on past contract performance or regard5 ing whom information on past contract performance is not

6 available, the offeror may not be evaluated favorably or

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

8 SEC. 1092. REPEAL OF REQUIREMENT FOR ANNUAL RE9 PORT ON COMPETITION.

10 Section 23 of the Office of Federal Procurement Pol11 icy Act (41 U.S.C. 419) is repealed.

12 Subtitle B—Truth in Negotiations

13 PART I—ARMED SERVICES ACQUISITIONS

14 SEC. 1201. STABILIZATION OF DOLLAR THRESHOLD OF AP15 PLICABILITY.

16 (a) REPEAL OF REVERSION TO LOWER THRESH17 OLD.—Paragraph (1)(A) of section 2306a(a) of title 10,

18 United States Code, is amended—

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

20 January 1, 1996,’’; and

21 (2) in clause (ii), by striking out ‘‘or after De22 cember 31, 1995,’’.

23 (b) ADJUSTMENTS FOR CHANGES IN DOLLAR VAL24 UES.—Section 2306a(a) of such title is amended by add25 ing at the end the following new subparagraph:
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1 ‘‘(7) Effective on October 1 of each year that is divis2 ible by 5, each amount set forth in paragraph (1) shall

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

4 1994 constant dollar value of the amount set forth. Any

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

6 $50,000 shall be rounded to the nearest multiple of

7 $50,000. In the case of an amount that is evenly divisible

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

9 amount shall be rounded to the next higher multiple of

10 $50,000.’’.

11 SEC. 1202. EXCEPTIONS TO COST OR PRICING DATA RE12 QUIREMENTS.

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

14 2306a of title 10, United States Code, is amended to read

15 as follows:

16 ‘‘(b) EXCEPTIONS.—(1) Submission of cost and pric17 ing data shall not be required under subsection (a)—

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

19 or a contract or subcontract modification, for which

20 the price agreed upon is based on—

21 ‘‘(i) adequate price competition;

22 ‘‘(ii) established catalog or market prices

23 of commercial items or of services customarily

24 used for other than Government purposes, as
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1 the case may be, that are sold in substantial

2 quantities to the general public; or

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

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

5 the agency concerned determines that the require6 ments of this section may be waived and states in

7 writing the reasons for such determination.

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

9 be required under subsection (a) in the case of a modifica10 tion of a contract or subcontract for a commercial item

11 if—

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

13 is a contract or subcontract for which submission of

14 cost and pricing data may not be required by reason

15 of paragraph (1)(A);

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

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

18 from requiring submission of cost and pricing data;

19 and

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

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

22 contract or subcontract for the acquisition of a com23 mercial item to a contract or subcontract for the ac24 quisition of a noncommercial item.’’.
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1 (b) CONFORMING AMENDMENT TO REFERENCE.—

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

3 out ‘‘subsection (b)(2)’’ and inserting in lieu thereof ‘‘sub4 section (b)(1)(B)’’.

5 SEC. 1203. LIMITATION ON AUTHORITY TO REQUIRE A SUB6 MISSION NOT OTHERWISE REQUIRED.

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

8 States Code, is amended to read as follows:

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

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

11 required to be submitted under this section by reason of

12 a $500,000 threshold set forth in subsection (a) (as ad13 justed pursuant to paragraph (7) of such subsection) or

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

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

16 be required unless the head of an agency concerned deter17 mines that such data are necessary for the evaluation by

18 the agency of the reasonableness of the price of the con19 tract or subcontract to which the data relate. In any case

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

21 submitted in accordance with the preceding sentence, the

22 agency head shall document in writing the reasons for

23 such requirement.’’.
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1 SEC. 1204. ADDITIONAL SPECIAL RULES FOR COMMERCIAL

2 ITEMS.

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

4 amended—

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

6 and (g) as subsections (e), (f), (g), and (i), respec7 tively; and

8 (2) by inserting after subsection (c) the follow9 ing new subsection (d):

10 ‘‘(d) ADDITIONAL EXCEPTION PROVISIONS REGARD11 ING COMMERCIAL ITEMS.—(1) To the maximum extent

12 practicable, the head of an agency shall conduct procure13 ments of commercial items on a competitive basis.

14 ‘‘(2) In any case in which it is not practicable to con15 duct a procurement of a commercial item on a competitive

16 basis and the procurement is not covered by an exception

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

18 exempt a contract, subcontract, or modification of a con19 tract or subcontract under the procurement from the re20 quirements of subsection (a) if the contracting officer de21 velops or obtains from the offeror or contractor, or from

22 another source or sources, in accordance with standards

23 and procedures set forth in the Federal Acquisition Regu24 lation, information on prices at which the same or similar

25 items have been sold in the commercial market that is ade26 quate for evaluating the reasonableness of the price of the
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1 contract or subcontract for a commercial item, or the con2 tract or subcontract modification, as the case may be.

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

4 the Federal Acquisition Regulation, the head of an agency

5 shall have the right to examine all information provided

6 by an offeror, contractor, or subcontractor pursuant to

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

8 contractor, or subcontractor that directly relate to such

9 information in order to determine whether the agency is

10 receiving accurate information required under this section.

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

12 3 years after the date of award of the contract, or 3 years

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

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

15 SEC. 1205. RIGHT OF UNITED STATES TO EXAMINE CON16 TRACTOR RECORDS.

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

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

19 by section 1204(1), and inserting in lieu thereof the fol20 lowing:

21 ‘‘(g) RIGHT OF UNITED STATES TO EXAMINE CON22 TRACTOR RECORDS.—For the purpose of evaluating the

23 accuracy, completeness, and currency of cost or pricing

24 data required to be submitted by this section, the head
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1 of an agency shall have the rights provided by section

2 2313 of this title.’’.

3 SEC. 1206. REQUIRED REGULATIONS.

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

5 amended by sections 1204 and 1205, is further amended

6 by inserting after subsection (g) the following new sub7 section:

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

9 prescribe regulations concerning the types of information

10 that offerors must submit for a contracting officer to con11 sider in determining whether the price of a procurement

12 to the Government is fair and reasonable when certified

13 cost or pricing data are not required to be submitted

14 under this section because the price of the procurement

15 to the United States is not expected to exceed an applica16 ble $500,000 threshold set forth in subsection (a) (as ad17 justed pursuant to paragraph (7) of such subsection).

18 Such information, at a minimum, shall include appropriate

19 information on the prices at which such offeror has pre20 viously sold the same or similar products.’’.

21 SEC. 1207. CONSISTENCY OF TIME REFERENCES.

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

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

24 (1) in subparagraphs (A)(ii) and (B)(ii) of sub25 section (e)(4), by inserting ‘‘or, if applicable consist-
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1 ent with paragraph (1)(B), another date agreed

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

3 modification)’’; and

4 (2) in subsection (i), by inserting ‘‘or, if appli5 cable consistent with subsection (d)(1)(B), another

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

7 price of a contract modification)’’.

8 SEC. 1208. EXCEPTION FOR TRANSFERS BETWEEN DIVI9 SIONS, SUBSIDIARIES, AND AFFILIATES.

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

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

12 amended to read as follows:

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

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

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

16 of a contract (or the price of a contract modifica17 tion), a prudent buyer or seller would reasonably ex18 pect to affect price negotiations significantly. Such

19 term does not include information that is

20 judgmental, but does include the factual information

21 from which a judgment was derived.

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

23 of commercial items between divisions, subsidiaries,

24 or affiliates of a contractor.’’.
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1 SEC. 1209. REPEAL OF SUPERSEDED PROVISION.

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

3 101–510 (10 U.S.C. 2306a note) are repealed.

4 PART II—CIVILIAN AGENCY ACQUISITIONS

5 SEC. 1251. REVISION OF CIVILIAN AGENCY PROVISIONS TO

6 ENSURE UNIFORM TREATMENT OF COST OR

7 PRICING DATA.

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

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

10 et seq.) is amended—

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

12 (d); and

13 (2) by inserting after section 304 the following

14 new section:

15 ‘‘COST OR PRICING DATA: TRUTH IN NEGOTIATIONS

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

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

18 offerors, contractors, and subcontractors to make cost or

19 pricing data available as follows:

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

21 title to be entered into using procedures other than

22 sealed-bid procedures shall be required to submit

23 cost or pricing data before the award of a contract

24 if—

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

26 into after the date of the enactment of the Fed-
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1 eral Acquisition Streamlining Act of 1994, the

2 price of the contract to the United States is ex3 pected to exceed $500,000; and

4 ‘‘(ii) in the case of a prime contract en5 tered into on or before the date of the enact6 ment of the Federal Acquisition Streamlining

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

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

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

10 this chapter shall be required to submit cost or pric11 ing data before the pricing of a change or modifica12 tion to the contract if—

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

14 made to a prime contract referred to in sub15 paragraph (A)(i), the price adjustment is ex16 pected to exceed $500,000;

17 ‘‘(ii) in the case of a change or modifica18 tion made to a prime contract that was entered

19 into on or before the date of the enactment of

20 the Federal Acquisition Streamlining Act of

21 1994, and that has been modified pursuant to

22 paragraph (6), the price adjustment is expected

23 to exceed $500,000; and
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1 ‘‘(iii) in the case of a change or modifica2 tion not covered by clause (i) or (ii), the price

3 adjustment is expected to exceed $100,000.

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

5 of a contract under this title shall be required to

6 submit cost or pricing data before the award of the

7 subcontract if the prime contractor and each higher8 tier subcontractor have been required to make avail9 able cost or pricing data under this section and—

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

11 prime contract referred to in subparagraph

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

13 to exceed $500,000;

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

15 into under a prime contract that was entered

16 into on or before the date of the enactment of

17 the Federal Acquisition Streamlining Act of

18 1994, and that has been modified pursuant to

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

20 expected to exceed $500,000; and

21 ‘‘(iii) in the case of a subcontract not cov22 ered by clause (i) or (ii), the price of the sub23 contract is expected to exceed $100,000.

24 ‘‘(D) The subcontractor for a subcontract cov25 ered by subparagraph (C) shall be required to sub-
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1 mit cost or pricing data before the pricing of a

2 change or modification to the subcontract if—

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

4 to a subcontract referred to in subparagraph

5 (C)(i) or (C)(ii), the price adjustment is ex6 pected to exceed $500,000; and

7 ‘‘(ii) in the case of a change or modifica8 tion to a subcontract referred to in subpara9 graph (C)(iii), the price adjustment is expected

10 to exceed $100,000.

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

12 subcontractor, to submit cost or pricing data under para13 graph (1) (or required by the agency head concerned to

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

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

16 knowledge and belief, the cost or pricing data submitted

17 are accurate, complete, and current.

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

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

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

21 paragraph (2), shall be submitted—

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

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

24 the contracting officer for the contract (or to a des25 ignated representative of the contracting officer); or
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1 ‘‘(B) in the case of a submission by a sub2 contractor (or an offeror for a subcontract), to the

3 prime contractor.

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

5 section applies to contracts entered into by an agency head

6 on behalf of a foreign government.

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

8 or subcontractor granted a waiver under subsection

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

10 make available cost or pricing data under this section.

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

12 required to submit cost or pricing data under paragraph

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

14 or before the date of the enactment of the Federal Acquisi15 tion Streamlining Act of 1994, the agency head that en16 tered into such contract shall modify the contract to re17 flect subparagraphs (B)(ii) and (C)(ii) of paragraph (1).

18 All such modifications shall be made without requiring

19 consideration.

20 ‘‘(B) An agency head is not required to modify a con21 tract under subparagraph (A) if that agency head deter22 mines that the submission of cost or pricing data with re23 spect to that contract should be required in accordance

24 with subsection (c).
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1 ‘‘(7) Effective on October 1 of each year that is divis2 ible by 5, each amount set forth in paragraph (1) shall

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

4 1994 constant dollar value of the amount set forth. Any

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

6 $50,000 shall be rounded to the nearest multiple of

7 $50,000. In the case of an amount that is evenly divisible

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

9 amount shall be rounded to the next higher multiple of

10 $50,000.

11 ‘‘(b) EXCEPTIONS.—(1) Submission of cost and pric12 ing data shall not be required under subsection (a)—

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

14 or a contract or subcontract modification, for which

15 the price agreed upon is based on—

16 ‘‘(i) adequate price competition;

17 ‘‘(ii) established catalog or market prices

18 of commercial items or of services customarily

19 used for other than Government purposes, as

20 the case may be, that are sold in substantial

21 quantities to the general public; or

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

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

24 head concerned determines that the requirements of
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1 this section may be waived and states in writing the

2 reasons for such determination.

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

4 be required under subsection (a) in the case of a modifica5 tion of a contract or subcontract for a commercial item

6 if—

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

8 is a contract or subcontract for which submission of

9 cost and pricing data may not be required by reason

10 of paragraph (1)(A);

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

12 paragraph (1)(A) prohibits the agency head from re13 quiring submission of cost and pricing data; and

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

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

16 contract or subcontract for the acquisition of a com17 mercial item to a contract or subcontract for the ac18 quisition of a noncommercial item.

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

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

21 required to be submitted under this section by reason of

22 a $500,000 threshold set forth in subsection (a) (as ad23 justed pursuant to paragraph (7) of such subsection) or

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

25 subsection (b), submission of such data may not be re-
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1 quired unless the agency head concerned determines that

2 such data are necessary for the evaluation by the agency

3 of the reasonableness of the price of the contract or sub4 contract to which the data relate. In any case in which

5 the agency head requires such data to be submitted in ac6 cordance with the preceding sentence, the agency head

7 shall document in writing the reasons for such require8 ment.

9 ‘‘(d) ADDITIONAL EXCEPTION PROVISIONS REGARD10 ING COMMERCIAL ITEMS.—(1) To the maximum extent

11 practicable, an agency head shall conduct procurements

12 of commercial items on a competitive basis.

13 ‘‘(2) In any case in which it is not practicable to con14 duct a procurement of a commercial item on a competitive

15 basis and the procurement is not covered by an exception

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

17 exempt a contract, subcontract, or modification of a con18 tract or subcontract under the procurement from the re19 quirements of subsection (a) if the contracting officer de20 velops or obtains from the offeror or contractor, or from

21 another source or sources, in accordance with standards

22 and procedures set forth in the Federal Acquisition Regu23 lation, information on prices at which the same or similar

24 items have been sold in the commercial market that is ade25 quate for evaluating the reasonableness of the price of the
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1 contract or subcontract for a commercial item, or the con2 tract or subcontract modification, as the case may be.

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

4 the Federal Acquisition Regulation, an agency head shall

5 have the right to examine all information provided by an

6 offeror, contractor, or subcontractor pursuant to para7 graph (2) and all books and records of such offeror, con8 tractor, or subcontractor that directly relate to such infor9 mation in order to determine whether the agency is receiv10 ing accurate information required under this section.

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

12 3 years after the date of award of the contract, or 3 years

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

14 respect to which the information was provided.

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

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

17 modification to a prime contract) under which a certificate

18 under subsection (a)(2) is required shall contain a provi19 sion that the price of the contract to the United States,

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

21 significant amount by which it may be determined by the

22 agency head that such price was increased because the

23 contractor (or any subcontractor required to make avail24 able such a certificate) submitted defective cost or pricing

25 data.
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1 ‘‘(B) For the purposes of this section, defective cost

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

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

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

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

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

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

8 upon by the parties shall be as close to the date of agree9 ment on the price of the contract as is practicable.

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

11 adjustment under a contract provision required by para12 graph (1) whether, and to what extent, a contract price

13 was increased because the contractor (or a subcontractor)

14 submitted defective cost or pricing data, it shall be a de15 fense that the United States did not rely on the defective

16 data submitted by the contractor or subcontractor.

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

18 of a contract under a contract provision required by para19 graph (1) that—

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

21 been modified even if accurate, complete, and cur22 rent cost or pricing data had been submitted by the

23 contractor or subcontractor because the contractor

24 or subcontractor—
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1 ‘‘(i) was the sole source of the property or

2 services procured; or

3 ‘‘(ii) otherwise was in a superior bargain4 ing position with respect to the property or

5 services procured;

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

7 that the cost and pricing data in issue were defective

8 even though the contractor or subcontractor took no

9 affirmative action to bring the character of the data

10 to the attention of the contracting officer;

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

12 between the contractor and the United States about

13 the total cost of the contract and there was no

14 agreement about the cost of each item procured

15 under such contract; or

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

17 not submit a certification of cost and pricing data

18 relating to the contract as required under subsection

19 (a)(2).

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

21 amount against the amount of a contract price adjustment

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

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

24 officer (or to a designated representative of the con25 tracting officer) that, to the best of the contractor’s
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1 knowledge and belief, the contractor is entitled to

2 the offset; and

3 ‘‘(ii) the contractor proves that the cost or pric4 ing data were available before the date of agreement

5 on the price of the contract (or price of the modi6 fication), or, if applicable consistent with paragraph

7 (1)(B), another date agreed upon between the par8 ties, and that the data were not submitted as speci9 fied in subsection (a)(3) before such date.

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

11 amount otherwise authorized to be offset under subpara12 graph (A) if—

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

14 with respect to the cost or pricing data involved was

15 known to be false when signed; or

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

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

18 been submitted to the United States before the date

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

20 of the modification) or, if applicable under para21 graph (1)(B), another date agreed upon between the

22 parties, the submission of such cost or pricing data

23 would not have resulted in an increase in that price

24 in the amount to be offset.
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1 ‘‘(f) INTEREST AND PENALTIES FOR CERTAIN OVER2 PAYMENTS.—(1) If the United States makes an overpay3 ment to a contractor under a contract with an executive

4 agency subject to this section and the overpayment was

5 due to the submission by the contractor of defective cost

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

7 States—

8 ‘‘(A) for interest on the amount of such over9 payment, to be computed—

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

11 the overpayment was made to the contractor

12 and ending on the date the contractor repays

13 the amount of such overpayment to the United

14 States; and

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

16 Secretary of the Treasury under section 6621

17 of the Internal Revenue Code of 1986; and

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

19 was a knowing submission, for an additional amount

20 equal to the amount of the overpayment.

21 ‘‘(2) Any liability under this subsection of a contrac22 tor that submits cost or pricing data but refuses to submit

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

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

25 refusal to submit such certification.
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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 304B(a)(2).

7 ‘‘(h) REQUIRED REGULATIONS.—The Federal Acqui8 sition Regulation shall include regulations concerning the

9 types of information that offerors must submit for a con10 tracting officer to consider in determining whether the

11 price of a procurement to the Government is fair and rea12 sonable when certified cost or pricing data are not re13 quired to be submitted under this section because the price

14 of the procurement to the United States is not expected

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

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

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

18 include appropriate information on the prices at which

19 such offeror has previously sold the same or similar prod20 ucts.

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

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

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

24 of a contract (or the price of a contract modifica25 tion) or, if applicable consistent with subsection
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1 (e)(1)(B), another date agreed upon between the

2 parties, a prudent buyer or seller would reasonably

3 expect to affect price negotiations significantly. Such

4 term does not include information that is

5 judgmental, but does include the factual information

6 from which a judgment was derived.

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

8 of commercial items between divisions, subsidiaries,

9 or affiliates of a contractor.’’.

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

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

12 the item relating to section 304 the following:

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

13 SEC. 1252. REPEAL OF OBSOLETE PROVISION.

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

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

16 is repealed.

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 303E.

20 Subtitle C—Research and

21 Development

22 SEC. 1301. RESEARCH PROJECTS.

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

24 2358 of title 10, United States Code, is amended to read

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

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

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

7 or other persons in accordance with the provisions of

8 chapter 63 of title 31;

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

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

11 Department of Defense; or

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

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

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

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

18 OF DEFENSE’’.

19 (c) ADVANCED RESEARCH PROJECTS.—

20 (1) RESTORATION AND REVISION OF FORMER

21 STATEMENT OF AUTHORITY.—Section 2371 of title

22 10, United States Code, is amended—

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

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

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

2 so redesignated, the following new subsection

3 (a):

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

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

7 designate, and the Secretary of each military department,

8 in carrying out basic, applied, and advanced research

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

10 contracts, grants, and cooperative agreements authorized

11 by section 2358 of this title.’’.

12 (2) CONFORMING AMENDMENTS.—Such section,

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

14 (A) in subsection (b)—

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

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

17 title’’; and

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

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

20 thereof ‘‘subsection (e)’’;

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

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

23 (C) in subsection (d)—

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

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

2 (a)’’; and

3 (ii) in paragraph (3), by striking out

4 ‘‘this section’’ and inserting in lieu thereof

5 ‘‘section 2358 of this title or subsection

6 (a)’’;

7 (D) in subsection (e), by inserting ‘‘or sub8 section (a)’’ in the first sentence after ‘‘section

9 2358 of this title’’; and

10 (E) in subsection (f)—

11 (i) in the first sentence, by striking

12 out ‘‘under this section’’ and inserting in

13 lieu thereof ‘‘under section 2358 of this

14 title or subsection (a)’’;

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

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

17 thereof ‘‘subsection (b)’’; and

18 (iii) in paragraph (5), by striking out

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

20 thereof ‘‘subsection (e)’’.
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1 SEC. 1302. ELIMINATION OF INFLEXIBLE TERMINOLOGY

2 REGARDING COORDINATION AND COMMU3 NICATION OF DEFENSE RESEARCH ACTIVI4 TIES.

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

6 amended—

7 (1) in subsection (b)(5), by striking out ‘‘mile8 stone 0, milestone I, and milestone II decisions’’ and

9 inserting in lieu thereof ‘‘acquisition program deci10 sions’’; and

11 (2) in subsection (c), by striking out para12 graphs (2), (3), and (4) and inserting in lieu thereof

13 the following:

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

15 has the meaning given such term in regulations pre16 scribed by the Secretary of Defense for the purposes

17 of this section.’’.

18 Subtitle D—Procurement Protests

19 PART I—PROTESTS TO THE COMPTROLLER

20 GENERAL

21 SEC. 1401. PROTEST DEFINED.

22 Paragraph (1) of section 3551 of title 31, United

23 States Code, is amended to read as follows:

24 ‘‘(1) ‘protest’ means a written objection by an

25 interested party—
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1 ‘‘(i) to a solicitation or other request by a

2 Federal agency for offers for a contract for the

3 procurement of property or services;

4 ‘‘(ii) to the cancellation of such a solicita5 tion or other request;

6 ‘‘(iii) to an award or proposed award of

7 such a contract; or

8 ‘‘(iv) to a termination or cancellation of an

9 award of such a contract, if the written objec10 tion contains an allegation that the termination

11 or cancellation is based in whole or in part on

12 improprieties concerning the award of the con13 tract;’’.

14 SEC. 1402. REVIEW OF PROTESTS AND EFFECT ON CON15 TRACTS PENDING DECISION.

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

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

18 (1) in subsection (b)—

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

20 working day of’’ and inserting in lieu thereof

21 ‘‘one day after’’; and

22 (B) in paragraph (2)—

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

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

25 in lieu thereof ‘‘35 days after’’; and
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1 (ii) in subparagraph (C), by striking

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

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

4 (2) in subsection (c)(3), by striking out ‘‘there5 after’’ and inserting in lieu thereof ‘‘after the mak6 ing of such finding’’.

7 (b) SUSPENSION OF PERFORMANCE.—Subsection (d)

8 of such section is amended to read as follows:

9 ‘‘(d)(1) A contractor awarded a Federal agency con10 tract may, during the period described in paragraph (4),

11 begin performance of the contract and engage in any relat12 ed activities that result in obligations being incurred by

13 the United States under the contract unless the contract14 ing officer responsible for the award of the contract with15 holds authorization to proceed with performance of the

16 contract.

17 ‘‘(2) The contracting officer may withhold an author18 ization to proceed with performance of the contract during

19 the period described in paragraph (4) if the contracting

20 officer determines in writing that—

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

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

23 is not in the best interests of the United States.
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1 ‘‘(3)(A) If the Federal agency awarding the contract

2 receives notice of a protest in accordance with this section

3 during the period described in paragraph (4)—

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

5 performance of the contract to begin while the pro6 test is pending; or

7 ‘‘(ii) if contract performance authorization to

8 proceed was not withheld in accordance with para9 graph (2) before receipt of the notice, the contract10 ing officer shall immediately direct the contractor to

11 cease performance under the contract and to sus12 pend any related activities that may result in addi13 tional obligations being incurred by the United

14 States under that contract.

15 ‘‘(B) Performance and related activities suspended

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

17 may not be resumed while the protest is pending.

18 ‘‘(C) The head of the procuring activity may author19 ize the performance of the contract (notwithstanding a

20 protest of which the Federal agency has notice under this

21 section)—

22 ‘‘(i) upon a written finding that—

23 ‘‘(I) performance of the contract is in the

24 best interests of the United States; or
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1 ‘‘(II) urgent and compelling circumstances

2 that significantly affect interests of the United

3 States will not permit waiting for the decision

4 of the Comptroller General concerning the pro5 test; and

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

7 that finding.

8 ‘‘(4) The period referred to in paragraphs (2) and

9 (3)(A), with respect to a contract, is the period beginning

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

11 of—

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

13 the contract award; or

14 ‘‘(B) the date that is 5 days after—

15 ‘‘(i) the debriefing date offered to an un16 successful offeror for any debriefing that is re17 quested and, when requested, is required; or

18 ‘‘(ii) in the case of a contract for which no

19 debriefing is required, the date on which the

20 unsuccessful offeror receives the notification of

21 contract award.’’.

22 SEC. 1403. DECISIONS ON PROTESTS.

23 (a) PERIODS FOR CERTAIN ACTIONS.—Section

24 3554(a) of title 31, United States Code, is amended—
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1 (1) in paragraph (1), by striking out ‘‘90 work2 ing days from’’ and inserting in lieu thereof ‘‘125

3 days after’’;

4 (2) in paragraph (2), by striking out ‘‘45 cal5 endar days from’’ and inserting ‘‘65 days after’’;

6 (3) by redesignating paragraph (3) as para7 graph (4); and

8 (4) by inserting after paragraph (2) the follow9 ing new paragraph (3):

10 ‘‘(3) An amendment to a protest that adds a new

11 ground of protest, if timely made, should be resolved, to

12 the maximum extent practicable, within the time limit es13 tablished under paragraph (1) of this subsection for final

14 decision of the initial protest. If an amended protest can15 not be resolved within such time limit, the Comptroller

16 General may resolve the amended protest through the ex17 press option under paragraph (2) of this subsection.’’.

18 (b) GAO RECOMMENDATIONS ON PROTESTS.—

19 (1) IMPLEMENTATION OF RECOMMENDA20 TIONS.—Section 3554 of title 31, United States

21 Code, is amended—

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

23 the following new paragraph:

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

25 the recommendations of the Comptroller General under
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1 this subsection with respect to a solicitation for a contract

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

3 days after receiving the recommendations, the head of the

4 procuring activity responsible for that contract shall re5 port such failure to the Comptroller General not later than

6 5 working days after the end of such 60-day period.’’;

7 (B) by striking out subsection (c) and in8 serting in lieu thereof the following:

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

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

11 award of a contract does not comply with a statute or reg12 ulation, the Comptroller General may recommend that the

13 Federal agency conducting the procurement pay to an ap14 propriate interested party the costs of—

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

16 reasonable attorney’s fees and consultant and expert

17 witness fees; and

18 ‘‘(B) bid and proposal preparation.

19 ‘‘(2) No party may be paid, pursuant to a rec20 ommendation made under the authority of paragraph

21 (1)—

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

23 fees that exceed the rates provided under section

24 504(b)(1)(A) of title 5 for expert witnesses; or
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1 ‘‘(B) costs for attorney’s fees that exceed the

2 rates provided for attorneys under section

3 504(b)(1)(A) of title 5.

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

5 paragraph (1) that a Federal agency pay costs to an inter6 ested party, the Federal agency shall—

7 ‘‘(A) pay the costs promptly; or

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

9 payment, promptly report to the Comptroller Gen10 eral the reasons for the failure to follow the Comp11 troller General’s recommendation.

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

13 paragraph (1) that a Federal agency pay costs to an inter14 ested party, the Federal agency and the interested party

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

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

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

18 Comptroller General may, upon the request of the inter19 ested party, recommend to the Federal agency the amount

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

21 (C) by striking out subsection (e) and in22 serting in lieu thereof the following:

23 ‘‘(e)(1) The Comptroller General shall report prompt24 ly to the Committee on Governmental Affairs and the

25 Committee on Appropriations of the Senate and to the
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1 Committee on Government Operations and the Committee

2 on Appropriations of the House of Representatives any

3 case in which a Federal agency fails to implement fully

4 a recommendation of the Comptroller General under sub5 section (b) or (c). The report shall include—

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

7 procurement, including the circumstances of the fail8 ure of the Federal agency to implement a rec9 ommendation of the Comptroller General; and

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

11 order to correct an inequity or to preserve the integ12 rity of the procurement process, the Congress should

13 consider—

14 ‘‘(i) private relief legislation;

15 ‘‘(ii) legislative rescission or cancellation of

16 funds;

17 ‘‘(iii) further investigation by Congress; or

18 ‘‘(iv) other action.

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

20 Comptroller General shall transmit to the Congress a re21 port containing a summary of each instance in which a

22 Federal agency did not fully implement a recommendation

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

24 during the preceding year. The report shall also describe

25 each instance in which a final decision in a protest was
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1 not rendered within 125 days after the date the protest

2 is submitted to the Comptroller General.’’.

3 (2) REQUIREMENT FOR PAYMENT IN ACCORD4 ANCE WITH PRIOR GAO DETERMINATIONS.—Costs to

5 which the Comptroller General declared an inter6 ested party to be entitled under section 3554 of title

7 31, United States Code, as in effect immediately be8 fore the enactment of this Act, shall, if not paid or

9 otherwise satisfied by the Federal agency concerned

10 before the date of the enactment of this Act, be paid

11 promptly.

12 SEC. 1404. REGULATIONS.

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

14 title 31, United States Code, is amended—

15 (1) by redesignating subsection (b) as sub16 section (d); and

17 (2) by inserting after subsection (a) the follow18 ing new subsection (b):

19 ‘‘(b) The procedures shall provide that, in the com20 putation of any period described in this subchapter—

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

22 which the designated period of time begins to run

23 not be included; and

24 ‘‘(2) the last day after such act, event, or de25 fault be included, unless—
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1 ‘‘(A) such last day is a Saturday, a Sun2 day, or a legal holiday; or

3 ‘‘(B) in the case of a filing of a paper at

4 the General Accounting Office or a Federal

5 agency, such last day is a day on which weather

6 or other conditions cause the closing of the

7 General Accounting Office or Federal agency,

8 in which event the next day that is not a Satur9 day, Sunday, or legal holiday shall be in10 cluded.’’.

11 (b) ELECTRONIC FILINGS AND DISSEMINATIONS.—

12 Such section, as amended by subsection (a), is further

13 amended by inserting after subsection (b) the following

14 new subsection:

15 ‘‘(c) The Comptroller General may prescribe proce16 dures for the electronic filing and dissemination of docu17 ments and information required under this subchapter. In

18 prescribing such procedures, the Comptroller General shall

19 consider the ability of all parties to achieve electronic ac20 cess to such documents and records.’’.

21 (c) REPEAL OF OBSOLETE DEADLINE.—Subsection

22 (a) of such section is amended by striking out ‘‘Not later

23 than January 15, 1985, the’’ and inserting in lieu thereof

24 ‘‘The’’.
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1 PART II—PROTESTS IN THE FEDERAL COURTS

2 SEC. 1421. NONEXCLUSIVITY OF REMEDIES.

3 Section 3556 of title 31, United States Code, is

4 amended by striking out ‘‘a district court of the United

5 States or the United States Claims Court’’ in the first sen6 tence and inserting in lieu thereof ‘‘the United States

7 Court of Federal Claims’’.

8 SEC. 1422. JURISDICTION OF THE UNITED STATES COURT

9 OF FEDERAL CLAIMS.

10 (a) CLAIMS AGAINST THE UNITED STATES AND BID

11 PROTESTS.—Section 1491 of title 28, United States Code,

12 is amended—

13 (1) by redesignating subsection (b) as sub14 section (e);

15 (2) in subsection (a)—

16 (A) by striking out ‘‘(a)(1)’’ and inserting

17 in lieu thereof ‘‘(a) CLAIMS AGAINST THE

18 UNITED STATES.—’’;

19 (B) in paragraph (2), by striking out ‘‘(2)

20 To’’ and inserting in lieu thereof ‘‘(b) REMEDY

21 AND RELIEF.—To’’; and

22 (C) by striking out paragraph (3); and

23 (3) by inserting after subsection (b), as des24 ignated by paragraph (2)(B), the following new sub25 section (c):
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1 ‘‘(c) BID PROTESTS.—(1) The United States Court

2 of Federal Claims has jurisdiction to render judgment on

3 an action by an interested party objecting to a solicitation

4 by a Federal agency for bids or proposals for a proposed

5 contract or to a proposed award or the award of a con6 tract. The court has jurisdiction to entertain such an ac7 tion without regard to whether suit is instituted before or

8 after the contract is awarded.

9 ‘‘(2) To afford relief in such an action, the court may

10 award any relief that the court considers proper, including

11 declaratory and injunctive relief.

12 ‘‘(3) In exercising jurisdiction under this subsection,

13 the court shall give due regard to the interests of national

14 defense and national security and the need for expeditious

15 resolution of the action.

16 ‘‘(4) The district courts of the United States do not

17 have jurisdiction of any action referred to in paragraph

18 (1).’’.

19 (b) CLERICAL AMENDMENTS.—

20 (1) SECTION HEADING.—The heading of such

21 section is amended by inserting ‘‘BID PROTESTS;’’

22 after ‘‘GENERALLY;’’.

23 (2) TABLE OF SECTIONS.—The table of sections

24 at the beginning of chapter 91 of title 28, United

25 States Code, is amended by striking out the item re-
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1 lating to section 1491 and inserting in lieu thereof

2 the following:

‘‘1491. Claims against United States generally; bid protests; actions involving

Tennessee Valley Authority.’’.

3 PART III—PROTESTS IN PROCUREMENTS OF

4 AUTOMATIC DATA PROCESSING

5 SEC. 1431. REVOCATION OF DELEGATIONS OF PROCURE6 MENT AUTHORITY.

7 Section 111(b)(3) of the Federal Property and Ad8 ministrative Services Act of 1949 (40 U.S.C. 759(b)(3))

9 is amended by inserting after the third sentence the fol10 lowing: ‘‘The Administrator may revoke a delegation of

11 authority with respect to a particular contract before or

12 after award of the contract, except that the Administrator

13 may revoke a delegation after the contract is awarded only

14 when there is a finding of a violation of law or regulation

15 in connection with the contract award.’’.

16 SEC. 1432. AUTHORITY OF THE GENERAL SERVICES ADMIN17 ISTRATION BOARD OF CONTRACT APPEALS.

18 The first sentence of section 111(f)(1) of the Federal

19 Property and Administrative Services Act of 1949 (40

20 U.S.C. 759(f)(1)) is amended to read as follows: ‘‘Upon

21 request of an interested party in connection with any pro22 curement that is subject to this section (including any

23 such procurement that is subject to delegation of procure24 ment authority), the board of contract appeals of the Gen-
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1 eral Services Administration (hereafter in this subsection

2 referred to as the ‘board’) shall review, as provided in this

3 subsection, any decision by a contracting officer that is

4 alleged to violate a statute, a regulation, or the conditions

5 of a delegation of procurement authority.’’.

6 SEC. 1433. PERIODS FOR CERTAIN ACTIONS.

7 (a) SUSPENSION OF PROCUREMENT AUTHORITY.—

8 Section 111(f) of the Federal Property and Administrative

9 Services Act of 1949 (40 U.S.C. 759(f)) is amended—

10 (1) in paragraph (2) by adding at the end the

11 following new subparagraph:

12 ‘‘(C) If, in the case of a preaward protest, the board

13 suspends the procurement authority of the Administrator

14 or the Administrator’s delegation of procurement author15 ity, the Administrator or the delegate, as the case may

16 be, may continue with the procurement action up to, but

17 not including, the awarding of the contract if the Adminis18 trator or the delegate, as the case may be, determines that

19 it is in the best interests of the United States to do so.’’;

20 and

21 (2) in paragraph (3) by striking out subpara22 graph (A) and inserting in lieu thereof the following:

23 ‘‘(A)(i) If, with respect to an award of a contract,

24 the board receives notice of a protest under this subsection

25 within the period described in clause (ii), the board shall,
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1 at the request of an interested party, hold a hearing to

2 determine whether the board should suspend the procure3 ment authority of the Administrator or the Administra4 tor’s delegation of procurement authority for the protested

5 procurement on an interim basis until the board can de6 cide the protest.

7 ‘‘(ii) The period referred to in clause (i) is the period

8 beginning on the date on which the contract is awarded

9 and ending on the date that is 10 days after the date of

10 the contract award or, if later, the date that is 5 days

11 after—

12 ‘‘(I) the debriefing date offered to an unsuc13 cessful offeror for any debriefing that is requested

14 and, when requested, is required; or

15 ‘‘(II) in the case of a contract for which no de16 briefing is required, the date on which the unsuc17 cessful offeror receives the notification of contract

18 award.

19 ‘‘(iii) The board shall hold the requested hearing

20 within 5 days after the date of the filing of the protest

21 or, in the case of a request for debriefing under the provi22 sions of section 2305(b)(5) of title 10, United States Code,

23 or section 303B(e) of this Act, within 5 days after the

24 later of the date of the filing of the protest or the date

25 of the debriefing.’’.
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1 (b) FINAL DECISION.—Paragraph (4)(B) of such sec2 tion 111(f) is amended—

3 (1) by striking out ‘‘45 working days’’ and in4 serting in lieu thereof ‘‘65 days’’; and

5 (2) by adding at the end the following: ‘‘An

6 amendment which adds a new ground of protest

7 should be resolved, to the maximum extent prac8 ticable, within the time limits established for resolu9 tion of the initial protest.’’.

10 SEC. 1434. DISMISSALS OF PROTESTS.

11 Section 111(f)(4) of the Federal Property and Ad12 ministrative Services Act of 1949 (40 U.S.C. 759(f)(4))

13 is amended by striking out subparagraph (C) and insert14 ing in lieu thereof the following:

15 ‘‘(C) The board may dismiss a protest that the board

16 determines—

17 ‘‘(i) is frivolous;

18 ‘‘(ii) has been brought in bad faith; or

19 ‘‘(iii) does not state on its face a valid basis for

20 protest.’’.

21 SEC. 1435. AWARD OF COSTS.

22 Section 111(f)(5) is amended by striking out sub23 paragraph (C) and inserting in lieu thereof the following:

24 ‘‘(C) Whenever the board makes such a determina25 tion, it may, in accordance with section 1304 of title 31,
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1 United States Code, further declare an appropriate pre2 vailing party to be entitled to the cost of filing and pursu3 ing the protest (including reasonable attorney’s fees and

4 consultant and expert witness fees), and bid and proposal

5 preparation. However, no party may be declared entitled

6 to costs for consultant and expert witness fees that exceed

7 the rates provided under section 504(b)(1)(A) of title 5,

8 United States Code, for expert witnesses or to costs for

9 attorney’s fees that exceed the rates provided for attorneys

10 under section 504(b)(1)(A) of title 5, United States

11 Code.’’.

12 SEC. 1436. DISMISSAL AGREEMENTS.

13 Section 111(f)(5) of the Federal Property and Ad14 ministrative Services Act of 1949 (40 U.S.C. 759(f)(5))

15 is amended by adding at the end the following new sub16 paragraphs:

17 ‘‘(D) Any agreement that provides for the dismissal

18 of a protest and involves a direct or indirect expenditure

19 of appropriated funds shall be submitted to the board and

20 shall be made a part of the public record (subject to any

21 protective order considered appropriate by the board) be22 fore dismissal of the protest. If a Federal agency is a party

23 to a settlement agreement, the submission of the agree24 ment submitted to the board shall include a memorandum,

25 signed by the contracting officer concerned, that describes
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1 in detail the procurement, the grounds for protest, the

2 Federal Government’s position regarding the grounds for

3 protest, the terms of the settlement, and the agency’s posi4 tion regarding the propriety of the award or proposed

5 award of the contract at issue in the protest.

6 ‘‘(E) Payment of amounts due from an agency under

7 subparagraph (C) or under the terms of a settlement

8 agreement under subparagraph (D) shall be made from

9 the appropriation made by section 1304 of title 31, United

10 States Code, for the payment of judgments. The Federal

11 agency concerned shall reimburse that appropriation ac12 count out of funds available for the procurement.’’.

13 SEC. 1437. JURISDICTION OF DISTRICT COURTS.

14 Section 111(f)(6)(C) of the Federal Property and Ad15 ministrative Services Act of 1949 (40 U.S.C.

16 759(f)(6)(C)) is amended by striking out ‘‘a district court

17 of the United States or’’.

18 SEC. 1438. MATTERS TO BE COVERED IN REGULATIONS.

19 Section 111(f) of the Federal Property and Adminis20 trative Services Act of 1949 (40 U.S.C. 759(f)) is amend21 ed by striking out paragraph (8) and inserting in lieu

22 thereof the following:

23 ‘‘(7)(A) The board shall adopt and issue such rules

24 and procedures as may be necessary to the expeditious dis-
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1 position of protests filed under the authority of this sub2 section.

3 ‘‘(B) The procedures shall provide that, in the com4 putation of any period described in this subsection—

5 ‘‘(i) the day of the act, event, or default from

6 which the designated period of time begins to run

7 not be included; and

8 ‘‘(ii) the last day after such act, event, or de9 fault be included, unless—

10 ‘‘(I) such last day is a Saturday, a Sunday,

11 or a legal holiday; or

12 ‘‘(II) in the case of a filing of a paper at

13 the board, such last day is a day on which

14 weather or other conditions cause the closing of

15 the board or Federal agency, in which event the

16 next day that is not a Saturday, Sunday, or

17 legal holiday shall be included.

18 ‘‘(C) The procedures may provide for electronic filing

19 and dissemination of documents and information required

20 under this subsection and in so providing shall consider

21 the ability of all parties to achieve electronic access to such

22 documents and records.

23 ‘‘(D) The procedures shall provide that if the board

24 expressly finds that a protest or a portion of a protest

25 is frivolous or has not been brought or pursued in good
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1 faith, or that any person has willfully abused the board’s

2 process during the course of a protest, the board may im3 pose appropriate procedural sanctions, including dismissal

4 of the protest.’’.

5 SEC. 1439. DEFINITIONS.

6 (a) PROTEST.—Section 111(f)(9)(A) of the Federal

7 Property and Administrative Services Act of 1949 (40

8 U.S.C. 759(f)(9)(A)) is amended to read as follows:

9 ‘‘(A) the term ‘protest’ means a written objec10 tion by an interested party—

11 ‘‘(i) to a solicitation or other request by a

12 Federal agency for offers for a contract for the

13 procurement of property or services;

14 ‘‘(ii) to the cancellation of such a solicita15 tion or other request;

16 ‘‘(iii) to an award or proposed award of

17 such a contract; or

18 ‘‘(iv) to a termination or cancellation of an

19 award of such a contract, if the written objec20 tion contains an allegation that the termination

21 or cancellation is based in whole or in part on

22 improprieties concerning the award of the con23 tract;’’.

24 (b) PREVAILING PARTY.—Section 111(f)(9) of such

25 Act is amended—
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1 (1) by striking out ‘‘and’’ at the end of sub2 paragraph (A);

3 (2) by striking out the period at the end of sub4 paragraph (B) and inserting in lieu thereof ‘‘; and’’;

5 and

6 (3) by adding at the end the following new sub7 paragraph:

8 ‘‘(C) the term ‘prevailing party’, with respect to

9 a determination of the board under paragraph

10 (5)(B) that a challenged action of a Federal agency

11 violates a statute or regulation or the conditions of

12 a delegation of procurement authority issued pursu13 ant to this section, means a party that demonstrated

14 such violation.’’.

15 Subtitle E—Definitions and Other

16 Matters

17 PART I—ARMED SERVICES ACQUISITIONS

18 SEC. 1501. DEFINITIONS.

19 Section 2302 of title 10, United States Code, is

20 amended—

21 (1) by striking out paragraphs (3), (4), (5), and

22 (7);

23 (2) by redesignating paragraph (6) as para24 graph (5); and
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1 (3) by inserting after paragraph (2) the follow2 ing:

3 ‘‘(3) The terms ‘commercial item’, ‘full and

4 open competition’, ‘major system’,

5 ‘nondevelopmental item’, ‘procurement’, ‘procure6 ment system’, ‘responsible source’, ‘standards’, and

7 ‘technical data’, have the meanings given such terms

8 in section 4 of the Office of Federal Procurement

9 Policy Act (41 U.S.C. 403).

10 ‘‘(4) The term ‘simplified acquisition threshold’

11 has the meaning given that term in section 4 of the

12 Office of Federal Procurement Policy Act (41 U.S.C.

13 403), except that, in the case of any contract to be

14 awarded and performed, or purchase to be made,

15 outside the United States in support of a contin16 gency operation, the term means an amount equal to

17 two times the amount specified for that term in sec18 tion 4 of such Act.’’.

19 SEC. 1502. DELEGATION OF PROCUREMENT FUNCTIONS.

20 (a) CONSOLIDATION OF DELEGATION AUTHORITY.—

21 Section 2311 of title 10, United States Code, is amended

22 to read as follows:

23 ‘‘§ 2311. Delegation

24 ‘‘(a) IN GENERAL.—Except to the extent expressly

25 prohibited by another provision of law, the head of an
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1 agency may delegate, subject to his direction, to any other

2 officer or official of that agency, any power under this

3 chapter.

4 ‘‘(b) PROCUREMENTS FOR OR WITH OTHER AGEN5 CIES.—Subject to subsection (a), to facilitate the procure6 ment of property and services covered by this chapter by

7 each agency named in section 2303 of this title for any

8 other agency, and to facilitate joint procurement by those

9 agencies—

10 ‘‘(1) the head of an agency may, within his

11 agency, delegate functions and assign responsibilities

12 relating to procurement;

13 ‘‘(2) the heads of two or more agencies may by

14 agreement delegate procurement functions and as15 sign procurement responsibilities from one agency to

16 another of those agencies or to an officer or civilian

17 employee of another of those agencies; and

18 ‘‘(3) the heads of two or more agencies may

19 create joint or combined offices to exercise procure20 ment functions and responsibilities.

21 ‘‘(c) APPROVAL OF TERMINATIONS AND REDUCTIONS

22 OF JOINT ACQUISITION PROGRAMS.—(1) The Secretary

23 of Defense shall prescribe regulations that prohibit each

24 military department participating in a joint acquisition

25 program approved by the Under Secretary of Defense for
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1 Acquisition and Technology from terminating or substan2 tially reducing its participation in such program without

3 the approval of the Under Secretary.

4 ‘‘(2) The regulations shall include the following provi5 sions:

6 ‘‘(A) A requirement that, before any such ter7 mination or substantial reduction in participation is

8 approved, the proposed termination or reduction be

9 reviewed by the Joint Requirements Oversight Coun10 cil of the Department of Defense.

11 ‘‘(B) A provision that authorizes the Under

12 Secretary of Defense for Acquisition and Technology

13 to require a military department approved for termi14 nation or substantial reduction in participation in a

15 joint acquisition program to continue to provide

16 some or all of the funding necessary for the acquisi17 tion program to be continued in an efficient man18 ner.’’.

19 (b) CONFORMING REPEAL.—(1) Section 2308 of title

20 10, United States Code, is repealed.

21 (2) The table of sections at the beginning of chapter

22 137 of such title is amended by striking out the item relat23 ed to section 2308.
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1 SEC. 1503. DETERMINATIONS AND DECISIONS.

2 Section 2310 of title 10, United States Code, is

3 amended to read as follows:

4 ‘‘§ 2310. Determinations and decisions

5 ‘‘(a) INDIVIDUAL OR CLASS DETERMINATIONS AND

6 DECISIONS AUTHORIZED.—Determinations and decisions

7 required to be made under this chapter by the head of

8 an agency may be made for an individual purchase or con9 tract or for a class of purchases or contracts. Such deter10 minations and decisions are final.

11 ‘‘(b) WRITTEN FINDINGS REQUIRED.—(1) Each de12 termination or decision under section 2306(e)(1), 2307(e),

13 or 2313(d)(2) of this title shall be based on a written find14 ing by the person making the determination or decision.

15 The finding shall set out facts and circumstances that sup16 port the determination or decision.

17 ‘‘(2) Each finding referred to in paragraph (1) shall

18 be final. The head of the agency making such finding shall

19 maintain a copy of the finding for not less than 6 years

20 after the date of the determination or decision.’’.

21 SEC. 1504. UNDEFINITIZED CONTRACTUAL ACTIONS: RE22 STRICTIONS.

23 (a) CLARIFICATION OF LIMITATION.—Subsection (b)

24 of section 2326 of title 10, United States Code, is amend25 ed—
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1 (1) in the subsection caption, by striking out

2 ‘‘AND EXPENDITURE’’;

3 (2) in paragraph (1)(B), by striking out ‘‘or ex4 pended’’;

5 (3) in paragraph (2), by striking out ‘‘expend’’

6 and inserting in lieu thereof ‘‘obligate’’; and

7 (4) in paragraph (3)—

8 (A) by striking out ‘‘expended’’ and insert9 ing in lieu thereof ‘‘obligated’’; and

10 (B) by striking out ‘‘expend’’ and inserting

11 in lieu thereof ‘‘obligate’’.

12 (b) WAIVER AUTHORITY.—Such subsection is amend13 ed—

14 (1) by redesignating paragraph (4) as para15 graph (5); and

16 (2) by inserting after paragraph (3) the follow17 ing new paragraph (4):

18 ‘‘(4) The head of an agency may waive the provisions

19 of this subsection with respect to a contract of that agency

20 if such head of an agency determines that the waiver is

21 necessary in order to support a contingency operation.’’.

22 (c) INAPPLICABILITY OF RESTRICTIONS TO CON23 TRACTS WITHIN THE SIMPLIFIED ACQUISITION THRESH24 OLD.—Section 2326(g)(1)(B) of title 10, United States

25 Code, is amended by striking out ‘‘small purchase thresh-
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1 old’’ and inserting in lieu thereof ‘‘simplified acquisition

2 threshold’’.

3 SEC. 1505. PRODUCTION SPECIAL TOOLING AND PRODUC4 TION SPECIAL TEST EQUIPMENT: CONTRACT

5 TERMS AND CONDITIONS.

6 (a) REPEAL.—Section 2329 of title 10, United States

7 Code, is repealed.

8 (b) TECHNICAL AMENDMENT.—The table of sections

9 at the beginning of chapter 137 of such title is amended

10 by striking out the item related to section 2329.

11 SEC. 1506. REGULATIONS FOR BIDS.

12 Section 2381(a) of title 10, United States Code, is

13 amended by striking out ‘‘(a) The Secretary’’ and all that

14 follows through the end of paragraph (1) and inserting

15 in lieu thereof the following:

16 ‘‘(a) The Secretary of Defense or the Secretary of

17 a military department may—

18 ‘‘(1) prescribe regulations for the preparation,

19 submission, and opening of bids for contracts; and’’.

20 PART II—CIVILIAN AGENCY ACQUISITIONS

21 SEC. 1551. DEFINITIONS.

22 Section 309(c) of the Federal Property and Adminis23 trative Services Act of 1949 (41 U.S.C. 259(c)) is amend24 ed by striking out ‘‘and ‘supplies’ ’’ and inserting in lieu
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1 thereof ‘‘ ‘supplies’, ‘commercial item’, ‘nondevelopmental

2 item’, and ‘simplified acquisition threshold’ ’’.

3 SEC. 1552. DELEGATION OF PROCUREMENT FUNCTIONS.

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

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

6 et seq.) is amended—

7 (1) by redesignating sections 309 and 310 as

8 sections 312 and 313, respectively; and

9 (2) by inserting after section 308 the following

10 new section 309:

11 ‘‘DELEGATION

12 ‘‘SEC. 309. (a) IN GENERAL.—Except to the extent

13 expressly prohibited by another provision of law, an agen14 cy head may delegate, subject to his direction, to any other

15 officer or official of that agency, any power under this

16 title.

17 ‘‘(b) PROCUREMENTS FOR OR WITH OTHER AGEN18 CIES.—Subject to subsection (a), to facilitate the procure19 ment of property and services covered by this title by each

20 executive agency for any other executive agency, and to

21 facilitate joint procurement by those executive agencies—

22 ‘‘(1) an agency head may, within his executive

23 agency, delegate functions and assign responsibilities

24 relating to procurement;

25 ‘‘(2) the heads of two or more executive agen26 cies may by agreement delegate procurement func-
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1 tions and assign procurement responsibilities from

2 one executive agency to another of those executive

3 agencies or to an officer or civilian employee of an4 other of those executive agencies; and

5 ‘‘(3) the heads of two or more executive agen6 cies may create joint or combined offices to exercise

7 procurement functions and responsibilities.’’.

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

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

10 the items relating to sections 309 and 310 and inserting

11 in lieu thereof the following:

‘‘Sec. 309. Delegation.

‘‘Sec. 312. Definitions.

‘‘Sec. 313. Statutes not applicable.’’.

12 SEC. 1553. DETERMINATIONS AND DECISIONS.

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

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

15 et seq.), as amended by section 1552, is further amended

16 by inserting after section 309 the following new section

17 310:

18 ‘‘DETERMINATIONS AND DECISIONS

19 ‘‘SEC. 310. (a) INDIVIDUAL OR CLASS DETERMINA20 TIONS AND DECISIONS AUTHORIZED.—Determinations

21 and decisions required to be made under this title by an

22 agency head may be made for an individual purchase or

23 contract or for a class of purchases or contracts. Such de24 terminations and decisions are final.
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1 ‘‘(b) WRITTEN FINDINGS REQUIRED.—(1) Each de2 termination under section 305(e) shall be based on a writ3 ten finding by the person making the determination or de4 cision. The finding shall set out facts and circumstances

5 that support the determination or decision.

6 ‘‘(2) Each finding referred to in paragraph (1) shall

7 be final. The agency head making such finding shall main8 tain a copy of the finding for not less than 6 years after

9 the date of the determination or decision.’’.

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

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

12 1552, is further amended by inserting after the item relat13 ing to section 309 the following:

‘‘Sec. 310. Determinations and decisions.’’.

14 SEC. 1554. COOPERATIVE PURCHASING.

15 Subsection (b) of section 201 of the Federal Property

16 and Administrative Services Act of 1949 (40 U.S.C. 481),

17 is amended to read as follows:

18 ‘‘(b)(1) The Administrator shall, as far as prac19 ticable, provide any of the services specified in subsection

20 (a) of this section to any other Federal agency, mixed21 ownership Government corporation (as defined in section

22 9101 of title 31, United States Code), or the District of

23 Columbia, upon its request.
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1 ‘‘(2)(A) The Administrator may provide for the use

2 of Federal supply schedules or other contracts by any of

3 the following entities upon request:

4 ‘‘(i) A State, any department or agency of a

5 State, and any political subdivision of a State, in6 cluding a local government.

7 ‘‘(ii) The District of Columbia.

8 ‘‘(iii) The Commonwealth of Puerto Rico.

9 ‘‘(iv) The government of an Indian tribe (as de10 fined in section 4(e) of the Indian Self-Determina11 tion and Education Assistance Act (25 U.S.C.

12 450b(e))).

13 ‘‘(B) Subparagraph (A) may not be construed to au14 thorize an entity referred to in that subparagraph to order

15 existing stock or inventory from federally owned and oper16 ated, or federally owned and contractor operated, supply

17 depots, warehouses, or similar facilities.

18 ‘‘(3)(A) Upon the request of a qualified nonprofit

19 agency for the blind or other severely handicapped that

20 is to provide a commodity or service to the Federal Gov21 ernment under the Javits-Wagner-O’Day Act, the Admin22 istrator may provide any of the services specified in sub23 section (a) to such agency to the extent practicable.

24 ‘‘(B) A nonprofit agency receiving services under the

25 authority of subparagraph (A) shall use the services di-
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1 rectly in making or providing an approved commodity or

2 approved service to the Federal Government.

3 ‘‘(C) In this paragraph:

4 ‘‘(i) The term ‘qualified nonprofit agency for

5 the blind or other severely handicapped’ means—

6 ‘‘(I) a qualified nonprofit agency for the

7 blind, as defined in section 5(3) of the Javits8 Wagner-O’Day Act (41 U.S.C. 48b(3)); and

9 ‘‘(II) a qualified nonprofit agency for other

10 severely handicapped, as defined in section 5(4)

11 of such Act (41 U.S.C. 48b(4)).

12 ‘‘(ii) The terms ‘approved commodity’ and ‘ap13 proved service’ mean a commodity and a service, re14 spectively, that has been determined by the Commit15 tee for Purchase from the Blind and Other Severely

16 Handicapped under section 2 of the Javits-Wagner17 O’Day Act (41 U.S.C. 47) to be suitable for pro18 curement by the Federal Government.

19 ‘‘(iii) The term ‘Javits-Wagner-O’Day Act’

20 means the Act entitled ‘An Act to create a Commit21 tee on Purchases of Blind-made Products, and for

22 other purposes’, approved June 25, 1938 (41 U.S.C.

23 46–48c), commonly referred to as the Wagner24 O’Day Act, that was revised and reenacted in the
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1 Act of June 23, 1971 (85 Stat. 77), commonly re2 ferred to as the Javits-Wagner-O’Day Act.’’.

3 TITLE II—CONTRACT

4 ADMINISTRATION

5 Subtitle A—Contract Payment

6 PART I—ARMED SERVICES ACQUISITIONS

7 SEC. 2001. CONTRACT FINANCING.

8 (a) REORGANIZATION OF PRINCIPAL AUTHORITY

9 PROVISION.—Section 2307 of title 10, United States

10 Code, is amended—

11 (1) by striking out the section heading and in12 serting in lieu thereof the following:

13 ‘‘§ 2307. Contract financing’’;

14 (2) by striking out ‘‘(a) The head of an agency’’

15 and inserting in lieu thereof ‘‘(b) PAYMENT AU16 THORITY.—The head of an agency’’;

17 (3) by striking out ‘‘(b) Payments’’ and insert18 ing in lieu thereof ‘‘(d) PAYMENT AMOUNT.—Pay19 ments’’;

20 (4) by striking out ‘‘(c) Advance payments’’ and

21 inserting in lieu thereof ‘‘(e) SECURITY FOR AD22 VANCE PAYMENTS.—Advance payments’’;

23 (5) by striking out ‘‘(d)(1) The Secretary of

24 Defense’’ and inserting in lieu thereof ‘‘(f) CONDI-
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1 TIONS FOR PROGRESS PAYMENTS.—(1) The Sec2 retary of Defense’’; and

3 (6) by striking out ‘‘(e)(1) In any case’’ and in4 serting in lieu thereof ‘‘(h) ACTION IN CASE OF

5 FRAUD.—(1) In any case’’.

6 (b) FINANCING POLICY.—Such section, as amended

7 by subsection (a), is further amended by inserting after

8 the section heading the following new subsection (a):

9 ‘‘(a) POLICY.—Payments authorized under this sec10 tion and made for financing purposes should be made peri11 odically or, when appropriate, on an advance basis and

12 should be so made in a timely manner to facilitate contract

13 performance while protecting the security interests of the

14 Government. Government financing shall be provided only

15 to the extent necessary to ensure prompt and efficient per16 formance and only after the availability of private financ17 ing is considered. A contractor’s use of funds received as

18 contract financing and the contractor’s financial condition

19 shall be monitored. If the contractor is a small business

20 concern, special attention shall be given to meeting the

21 contractor’s financial need.’’.

22 (c) PERFORMANCE-BASED PAYMENTS.—Such sec23 tion, as amended by subsection (a), is further amended

24 by inserting after subsection (b) the following new sub25 section (c):
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1 ‘‘(c) PERFORMANCE-BASED PAYMENTS.—Whenever

2 practicable, payments under subsection (b) shall be made

3 on any of the following bases:

4 ‘‘(1) Performance measured by objective, quan5 tifiable methods such as receipt of items by the Fed6 eral Government, work measurement, or statistical

7 process controls.

8 ‘‘(2) Accomplishment of events defined in the

9 program management plan.

10 ‘‘(3) Other quantifiable measures of results.’’.

11 (d) TERMINOLOGY CORRECTION.—Such section, as

12 amended by subsection (a)(2), is further amended in sub13 section (b)(2) by striking out ‘‘bid’’.

14 (e) EFFECTIVE DATE OF LIEN RELATED TO AD15 VANCE PAYMENTS.—Such section, as amended by sub16 section (a)(4), is further amended in subsection (e) by in17 serting before the period at the end of the third sentence

18 the following: ‘‘and is effective immediately upon the first

19 advancement of funds without filing, notice, or any other

20 action by the United States’’.

21 (f) CONDITIONS FOR PROGRESS PAYMENTS.—Such

22 section, as amended by subsection (a)(5), is further

23 amended in subsection (f)—

24 (1) in the first sentence of paragraph (1), by

25 striking out ‘‘work, which’’ and all that follows
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1 through ‘‘accomplished’’ and inserting in lieu thereof

2 ‘‘work accomplished that meets standards estab3 lished under the contract’’; and

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

5 in lieu thereof the following:

6 ‘‘(3) This subsection applies to a contract for an

7 amount equal to or greater than the simplified acquisition

8 threshold.’’.

9 (g) NAVY CONTRACTS.—Such section, as amended by

10 subsection (a)(5), is further amended by inserting after

11 subsection (f) the following new subsection (g):

12 ‘‘(g) CERTAIN NAVY CONTRACTS.—(1) The Sec13 retary of the Navy shall provide that the rate for progress

14 payments on any contract awarded by the Secretary for

15 repair, maintenance, or overhaul of a naval vessel shall

16 be not less than—

17 ‘‘(A) 95 percent, in the case of firms considered

18 to be small businesses; and

19 ‘‘(B) 90 percent, in the case of all other firms.

20 ‘‘(2) The Secretary of the Navy may advance to pri21 vate salvage companies such funds as the Secretary con22 siders necessary to provide for the immediate financing

23 of salvage operations. Advances under this paragraph shall

24 be made on terms that the Secretary considers adequate

25 for the protection of the United States.
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1 ‘‘(3) The Secretary of the Navy shall ensure that,

2 when partial, progress, or other payments are made under

3 a contract for construction or conversion of a naval vessel,

4 the United States is secured by a lien upon work in

5 progress and on property acquired for performance of the

6 contract on account of all payments so made. The lien is

7 paramount to all other liens.’’.

8 (h) CONFORMING AND CLERICAL AMENDMENTS.—

9 (1) CROSS REFERENCE.—Such section, as

10 amended by subsection (a), is further amended in

11 subsections (d) and (e) by striking out ‘‘subsection

12 (a)’’ and inserting in lieu thereof ‘‘subsection (b)’’.

13 (2) TABLE OF CONTENTS.—The table of sec14 tions at the beginning of chapter 137 of title 10,

15 United States Code, is amended by striking out the

16 item relating to section 2307 and inserting in lieu

17 thereof the following:

‘‘2307. Contract financing.’’.

18 (i) REPEAL OF SUPERSEDED PROVISIONS.—

19 (1) PROGRESS PAYMENTS UNDER CERTAIN

20 NAVY CONTRACTS.—

21 (A) REPEAL.—Section 7312 of title 10,

22 United States Code, is repealed.

23 (B) CLERICAL AMENDMENT.—The table of

24 sections at the beginning of chapter 633 of such
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1 title is amended by striking out the item relat2 ing to section 7312.

3 (2) ADVANCEMENT OF PAYMENTS FOR NAVY

4 SALVAGE OPERATIONS.—

5 (A) REPEAL.—Section 7364 of such title is

6 repealed.

7 (B) CLERICAL AMENDMENT.—The table of

8 sections at the beginning of chapter 637 of such

9 title is amended by striking out the item relat10 ing to section 7364.

11 (3) PARTIAL PAYMENTS UNDER NAVY CON12 TRACTS.—

13 (A) REPEAL.—Section 7521 of such title is

14 repealed.

15 (B) CLERICAL AMENDMENT.—The table of

16 sections at the beginning of chapter 645 of such

17 title is amended by striking out the item relat18 ing to section 7521.

19 SEC. 2002. CONTRACTS: VOUCHERING PROCEDURES.

20 (a) REPEAL.—Section 2355 of title 10, United States

21 Code, is repealed.

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

23 at the beginning of chapter 139 of such title is amended

24 by striking out the item relating to section 2355.
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1 PART II—CIVILIAN AGENCY ACQUISITIONS

2 SEC. 2051. CONTRACT FINANCING.

3 (a) REORGANIZATION OF PRINCIPAL AUTHORITY

4 PROVISION.—Section 305 of the Federal Property and

5 Administrative Services Act of 1949 (41 U.S.C. 255) is

6 amended—

7 (1) by striking out the section heading and in8 serting in lieu thereof the following:

9 ‘‘CONTRACT FINANCING’’;

10 (2) by striking out ‘‘(a) Any executive agency’’

11 and inserting in lieu thereof ‘‘(b) PAYMENT AU12 THORITY.—Any executive agency’’;

13 (3) by striking out ‘‘(b) Payments’’ and insert14 ing in lieu thereof ‘‘(d) PAYMENT AMOUNT.—Pay15 ments’’; and

16 (4) by striking out ‘‘(c) Advance payments’’ and

17 inserting in lieu thereof ‘‘(e) SECURITY FOR AD18 VANCE PAYMENTS.—Advance payments’’.

19 (b) FINANCING POLICY.—Such section, as amended

20 by subsection (a), is further amended by inserting after

21 the section heading the following new subsection (a):

22 ‘‘(a) POLICY.—Payments authorized under this sec23 tion and made for financing purposes should be made peri24 odically or, when appropriate, on an advance basis and

25 should be so made in a timely manner to facilitate contract

26 performance while protecting the security interests of the
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1 Government. Government financing shall be provided only

2 to the extent necessary to ensure prompt and efficient per3 formance and only after the availability of private financ4 ing is considered. A contractor’s use of funds received as

5 contract financing and the contractor’s financial condition

6 shall be monitored. If the contractor is a small business

7 concern, special attention shall be given to meeting the

8 contractor’s financial need.’’.

9 (c) PERFORMANCE-BASED PAYMENTS.—Such sec10 tion, as amended by subsection (a), is further amended

11 by inserting after subsection (b) the following new sub12 section (c):

13 ‘‘(c) PERFORMANCE-BASED PAYMENTS.—Whenever

14 practicable, payments under subsection (b) shall be made

15 on any of the following bases:

16 ‘‘(1) Performance measured by objective, quan17 tifiable methods such as receipt of items by the Fed18 eral Government, work measurement, or statistical

19 process controls.

20 ‘‘(2) Accomplishment of events defined in the

21 program management plan.

22 ‘‘(3) Other quantifiable measures of results.’’.

23 (d) TERMINOLOGY CORRECTION.—Such section, as

24 amended by subsection (a)(2), is further amended in sub25 section (b)(2) by striking out ‘‘bid’’.
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1 (e) EFFECTIVE DATE OF LIEN RELATED TO AD2 VANCE PAYMENTS.—Such section, as amended by sub3 section (a)(4), is further amended in subsection (e) 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 (f) 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 ‘‘(f) 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 ‘‘(g) 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 (g) 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 (d) and (e) 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.—Section

15 2324 is amended by striking out subsection (l).

16 (b) COVERED CONTRACT DEFINED.—Subsection (m)

17 of section 2324 of title 10, United States Code, is amend18 ed to read as follows:

19 ‘‘(l)(1) In this section, the term ‘covered contract’

20 means a contract for an amount in excess of $500,000

21 that is entered into by the Department of Defense, except

22 that such term does not include a fixed-price contract

23 without cost incentives.

24 ‘‘(2) Effective on October 1 of each year that is divis25 ible by 5, the amount set forth in paragraph (1) shall be
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1 adjusted to the amount that is equal to the fiscal year

2 1994 constant dollar value of the amount set forth. An

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

4 $50,000 shall be rounded to the nearest multiple of

5 $50,000. In the case of an amount that is evenly divisible

6 by $25,000 but is not evenly divisible by $50,000, the

7 amount shall be rounded to the next higher multiple of

8 $50,000.’’.

9 SEC. 2102. CONTRACT PROFIT CONTROLS DURING EMER10 GENCY PERIODS.

11 (a) REPEAL.—Section 2382 of title 10, United States

12 Code, is repealed.

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

14 at the beginning of chapter 141 of such title is amended

15 by striking out the item relating to section 2382.

16 PART II—CIVILIAN AGENCY ACQUISITIONS

17 SEC. 2151. ALLOWABLE CONTRACT COSTS.

18 (a) REVISION OF CIVILIAN AGENCY PROVISION TO

19 ENSURE UNIFORM TREATMENT OF CONTRACT COSTS.—

20 Section 306 of the Federal Property and Administrative

21 Services Act of 1949 (41 U.S.C. 256) is amended to read

22 as follows:

23 ‘‘ALLOWABLE COSTS

24 ‘‘SEC. 306. (a) INDIRECT COST THAT VIOLATES A

25 FAR COST PRINCIPLE.—The head of an executive agency

26 shall require that a covered contract provide that if the
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1 contractor submits to the executive agency a proposal for

2 settlement of indirect costs incurred by the contractor for

3 any period after such costs have been accrued and if that

4 proposal includes the submission of a cost which is unal5 lowable because the cost violates a cost principle in the

6 Federal Acquisition Regulation or an executive agency’s

7 supplement to the Federal Acquisition Regulation, the cost

8 shall be disallowed.

9 ‘‘(b) PENALTY FOR VIOLATION OF COST PRIN10 CIPLE.—(1) If the agency head determines that a cost

11 submitted by a contractor in its proposal for settlement

12 is expressly unallowable under a cost principle referred to

13 in subsection (a) that defines the allowability of specific

14 selected costs, the agency head shall assess a penalty

15 against the contractor in an amount equal to—

16 ‘‘(A) the amount of the disallowed cost allo17 cated to covered contracts for which a proposal for

18 settlement of indirect costs has been submitted; plus

19 ‘‘(B) interest (to be computed based on regula20 tions issued by the agency head) to compensate the

21 United States for the use of any funds which a con22 tractor has been paid in excess of the amount to

23 which the contractor was entitled.

24 ‘‘(2) If the agency head determines that a proposal

25 for settlement of indirect costs submitted by a contractor
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1 includes a cost determined to be unallowable in the case

2 of such contractor before the submission of such proposal,

3 the agency head shall assess a penalty against the contrac4 tor in an amount equal to two times the amount of the

5 disallowed cost allocated to covered contracts for which a

6 proposal for settlement of indirect costs has been submit7 ted.

8 ‘‘(c) WAIVER OF PENALTY.—In accordance with the

9 Federal Acquisition Regulation, the agency head may

10 waive a penalty under subsection (b) in the case of a con11 tractor’s proposal for settlement of indirect costs when—

12 ‘‘(1) the contractor withdraws the proposal be13 fore the formal initiation of an audit of the proposal

14 by the Federal Government and resubmits a revised

15 proposal;

16 ‘‘(2) the amount of unallowable costs subject to

17 the penalty is insignificant; or

18 ‘‘(3) the contractor demonstrates, to the con19 tracting officer’s satisfaction, that—

20 ‘‘(A) it has established appropriate policies

21 and personnel training and an internal control

22 and review system that provide assurances that

23 unallowable costs subject to penalties are pre24 cluded from being included in the contractor’s

25 proposal for settlement of indirect costs; and
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1 ‘‘(B) the unallowable costs subject to the

2 penalty were inadvertently incorporated into the

3 proposal.

4 ‘‘(d) APPLICABILITY OF CONTRACT DISPUTES PRO5 CEDURE TO DISALLOWANCE OF COST AND ASSESSMENT

6 OF PENALTY.—An action of an agency head under sub7 section (a) or (b)—

8 ‘‘(1) shall be considered a final decision for the

9 purposes of section 6 of the Contract Disputes Act

10 of 1978 (41 U.S.C. 605); and

11 ‘‘(2) is appealable in the manner provided in

12 section 7 of such Act.

13 ‘‘(e) SPECIFIC COSTS NOT ALLOWABLE.—(1) The

14 following costs are not allowable under a covered contract:

15 ‘‘(A) Costs of entertainment, including amuse16 ment, diversion, and social activities, and any costs

17 directly associated with such costs (such as tickets

18 to shows or sports events, meals, lodging, rentals,

19 transportation, and gratuities).

20 ‘‘(B) Costs incurred to influence (directly or in21 directly) legislative action on any matter pending be22 fore Congress or a State legislature.

23 ‘‘(C) Costs incurred in defense of any civil or

24 criminal fraud proceeding or similar proceeding (in25 cluding filing of any false certification) brought by
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1 the United States where the contractor is found lia2 ble or had pleaded nolo contendere to a charge of

3 fraud or similar proceeding (including filing of a

4 false certification).

5 ‘‘(D) Payments of fines and penalties resulting

6 from violations of, or failure to comply with, Fed7 eral, State, local, or foreign laws and regulations, ex8 cept when incurred as a result of compliance with

9 specific terms and conditions of the contract or spe10 cific written instructions from the contracting officer

11 authorizing in advance such payments in accordance

12 with the Federal Acquisition Regulation.

13 ‘‘(E) Costs of membership in any social, dining,

14 or country club or organization.

15 ‘‘(F) Costs of alcoholic beverages.

16 ‘‘(G) Contributions or donations, regardless of

17 the recipient.

18 ‘‘(H) Costs of advertising designed to promote

19 the contractor or its products.

20 ‘‘(I) Costs of promotional items and memora21 bilia, including models, gifts, and souvenirs.

22 ‘‘(J) Costs for travel by commercial aircraft

23 which exceed the amount of the standard commercial

24 fare.
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1 ‘‘(K) Costs incurred in making any payment

2 (commonly known as a ‘golden parachute payment’)

3 which is—

4 ‘‘(i) in an amount in excess of the normal

5 severance pay paid by the contractor to an em6 ployee upon termination of employment; and

7 ‘‘(ii) is paid to the employee contingent

8 upon, and following, a change in management

9 control over, or ownership of, the contractor or

10 a substantial portion of the contractor’s assets.

11 ‘‘(L) Costs of commercial insurance that pro12 tects against the costs of the contractor for correc13 tion of the contractor’s own defects in materials or

14 workmanship.

15 ‘‘(M) Costs of severance pay paid by the con16 tractor to foreign nationals employed by the contrac17 tor under a service contract performed outside the

18 United States, to the extent that the amount of sev19 erance pay paid in any case exceeds the amount paid

20 in the industry involved under the customary or pre21 vailing practice for firms in that industry providing

22 similar services in the United States, as determined

23 in accordance with the Federal Acquisition Regula24 tion.
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•S 2206 PCS

1 ‘‘(N) Costs of severance pay paid by the con2 tractor to a foreign national employed by the con3 tractor under a service contract performed in a for4 eign country if the termination of the employment of

5 the foreign national is the result of the closing of,

6 or the curtailment of activities at, a United States

7 facility in that country at the request of the govern8 ment of that country.

9 ‘‘(O) Costs incurred by a contractor in connec10 tion with any criminal, civil, or administrative pro11 ceeding commenced by the United States or a State,

12 to the extent provided in subsection (k).

13 ‘‘(2)(A) Subject to the availability of appropriations,

14 the head of an executive agency, in awarding a covered

15 contract, may waive in accordance with the Federal Acqui16 sition Regulation the application of the provisions of para17 graphs (1)(M) and (1)(N) to that contract if the agency

18 head determines that—

19 ‘‘(i) the application of such provisions to the

20 contract would adversely affect the continuation of a

21 program, project, or activity that provides significant

22 support services for employees of the executive agen23 cy posted outside the United States;

24 ‘‘(ii) the contractor has taken (or has estab25 lished plans to take) appropriate actions within the
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1 contractor’s control to minimize the amount and

2 number of incidents of the payment of severance pay

3 by the contractor to employees under the contract

4 who are foreign nationals; and

5 ‘‘(iii) the payment of severance pay is necessary

6 in order to comply with a law that is generally appli7 cable to a significant number of businesses in the

8 country in which the foreign national receiving the

9 payment performed services under the contract or is

10 necessary to comply with a collective bargaining

11 agreement.

12 ‘‘(B) The head of the executive agency concerned

13 shall include in the solicitation for a covered contract a

14 statement indicating—

15 ‘‘(i) that a waiver has been granted under sub16 paragraph (A) for the contract; or

17 ‘‘(ii) whether the agency head will consider

18 granting such a waiver, and, if the agency head will

19 consider granting a waiver, the criteria to be used in

20 granting the waiver.

21 ‘‘(C) The agency head shall make the final determina22 tion regarding whether to grant a waiver under subpara23 graph (A) with respect to a covered contract before award

24 of the contract.
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1 ‘‘(3) The head of each executive agency shall imple2 ment this section with respect to contracts of that execu3 tive agency in accordance with the Federal Acquisition

4 Regulation. The provisions of the Federal Acquisition ap5 plicable to the implementation of this section may include

6 definitions, exclusions, limitations, and qualifications.

7 ‘‘(f) REQUIRED REGULATIONS.—(1) The Federal Ac8 quisition Regulation referred to in section 25(c)(1) of the

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

10 421(c)(1)) shall contain provisions on the allowability of

11 contractor costs. Such provisions shall define in detail and

12 in specific terms those costs which are unallowable, in

13 whole or in part, under covered contracts. The regulations

14 shall, at a minimum, clarify the cost principles applicable

15 to contractor costs of the following:

16 ‘‘(A) Air shows.

17 ‘‘(B) Membership in civic, community, and pro18 fessional organizations.

19 ‘‘(C) Recruitment.

20 ‘‘(D) Employee morale and welfare.

21 ‘‘(E) Actions to influence (directly or indirectly)

22 executive branch action on regulatory and contract

23 matters (other than costs incurred in regard to con24 tract proposals pursuant to solicited or unsolicited

25 bids).
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1 ‘‘(F) Community relations.

2 ‘‘(G) Dining facilities.

3 ‘‘(H) Professional and consulting services, in4 cluding legal services.

5 ‘‘(I) Compensation.

6 ‘‘(J) Selling and marketing.

7 ‘‘(K) Travel.

8 ‘‘(L) Public relations.

9 ‘‘(M) Hotel and meal expenses.

10 ‘‘(N) Expense of corporate aircraft.

11 ‘‘(O) Company-furnished automobiles.

12 ‘‘(P) Advertising.

13 ‘‘(2) The Federal Acquisition Regulation shall require

14 that a contracting officer not resolve any questioned costs

15 until the contracting officer has obtained—

16 ‘‘(A) adequate documentation with respect to

17 such costs; and

18 ‘‘(B) the opinion of the executive agency’s con19 tract auditor on the allowability of such costs.

20 ‘‘(3) The Federal Acquisition Regulation shall pro21 vide that, to the maximum extent practicable, an executive

22 agency’s contract auditor be present at any negotiation or

23 meeting with the contractor regarding a determination of

24 the allowability of indirect costs of the contractor.
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1 ‘‘(4) The Federal Acquisition Regulation shall require

2 that all categories of costs designated in the report of an

3 executive agency’s contract auditor as questioned with re4 spect to a proposal for settlement be resolved in such a

5 manner that the amount of the individual questioned costs

6 that are paid will be reflected in the settlement.

7 ‘‘(g) APPLICABILITY OF REQUIRED REGULATIONS TO

8 SUBCONTRACTORS.—The regulations prescribed to carry

9 out subsections (e) and (f)(1) shall require, to the maxi10 mum extent practicable, that such regulations apply to all

11 subcontractors of a covered contract.

12 ‘‘(h) CONTRACTOR CERTIFICATION REQUIRED.—(1)

13 A proposal for settlement of indirect costs applicable to

14 a covered contract shall include a certification by an offi15 cial of the contractor that, to the best of the certifying

16 official’s knowledge and belief, all indirect costs included

17 in the proposal are allowable. Any such certification shall

18 be in a form prescribed by the agency head concerned.

19 ‘‘(2) The agency head concerned may, in an excep20 tional case, waive the requirement for certification under

21 paragraph (1) in the case of any contract if the agency

22 head—

23 ‘‘(A) determines in such case that it would be

24 in the interest of the United States to waive such

25 certification; and
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1 ‘‘(B) states in writing the reasons for that de2 termination and makes such determination available

3 to the public.

4 ‘‘(i) PENALTIES FOR SUBMISSION OF COST KNOWN

5 AS NOT ALLOWABLE.—The submission to an executive

6 agency of a proposal for settlement of costs for any period

7 after such costs have been accrued that includes a cost

8 that is expressly specified by statute or regulation as being

9 unallowable, with the knowledge that such cost is unallow10 able, shall be subject to the provisions of section 287 of

11 title 18, United States Code, and section 3729 of title 31,

12 United States Code.

13 ‘‘(j) CONTRACTOR TO HAVE BURDEN OF PROOF.—

14 In a proceeding before a board of contract appeals, the

15 United States Court of Federal Claims, or any other Fed16 eral court in which the reasonableness of indirect costs for

17 which a contractor seeks reimbursement from the United

18 States is in issue, the burden of proof shall be upon the

19 contractor to establish that those costs are reasonable.

20 ‘‘(k) PROCEEDING COSTS NOT ALLOWABLE.—(1)

21 Except as otherwise provided in this subsection, costs in22 curred by a contractor in connection with any criminal,

23 civil, or administrative proceeding commenced by the

24 United States or a State are not allowable as reimbursable

25 costs under a covered contract if the proceeding (A) re-
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•S 2206 PCS

1 lates to a violation of, or failure to comply with, a Federal

2 or State statute or regulation, and (B) results in a disposi3 tion described in paragraph (2).

4 ‘‘(2) A disposition referred to in paragraph (1)(B) is

5 any of the following:

6 ‘‘(A) In the case of a criminal proceeding, a

7 conviction (including a conviction pursuant to a plea

8 of nolo contendere) by reason of the violation or fail9 ure referred to in paragraph (1).

10 ‘‘(B) In the case of a civil or administrative

11 proceeding involving an allegation of fraud or similar

12 misconduct, a determination of contractor liability

13 on the basis of the violation or failure referred to in

14 paragraph (1).

15 ‘‘(C) In the case of any civil or administrative

16 proceeding, the imposition of a monetary penalty by

17 reason of the violation or failure referred to in para18 graph (1).

19 ‘‘(D) A final decision—

20 ‘‘(i) to debar or suspend the contractor,

21 ‘‘(ii) to rescind or void the contract, or

22 ‘‘(iii) to terminate the contract for default,

23 by reason of the violation or failure referred to in

24 paragraph (1).
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1 ‘‘(E) A disposition of the proceeding by consent

2 or compromise if such action could have resulted in

3 a disposition described in subparagraph (A), (B),

4 (C), or (D).

5 ‘‘(3) In the case of a proceeding referred to in para6 graph (1) that is commenced by the United States and

7 is resolved by consent or compromise pursuant to an

8 agreement entered into by a contractor and the United

9 States, the costs incurred by the contractor in connection

10 with such proceeding that are otherwise not allowable as

11 reimbursable costs under such paragraph may be allowed

12 to the extent specifically provided in such agreement.

13 ‘‘(4) In the case of a proceeding referred to in para14 graph (1) that is commenced by a State, the agency head

15 that awarded the covered contract involved in the proceed16 ing may allow the costs incurred by the contractor in con17 nection with such proceeding as reimbursable costs if the

18 agency head determines, under regulations prescribed by

19 such agency head, that the costs were incurred as a result

20 of (A) a specific term or condition of the contract, or (B)

21 specific written instructions of the agency.

22 ‘‘(5)(A) Except as provided in subparagraph (C),

23 costs incurred by a contractor in connection with a crimi24 nal, civil, or administrative proceeding commenced by the

25 United States or a State in connection with a covered con-
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1 tract may be allowed as reimbursable costs under the con2 tract if such costs are not disallowable under paragraph

3 (1), but only to the extent provided in subparagraph (B).

4 ‘‘(B)(i) The amount of the costs allowable under sub5 paragraph (A) in any case may not exceed the amount

6 equal to 80 percent of the amount of the costs incurred,

7 to the extent that such costs are determined to be other8 wise allowable and allocable under the Federal Acquisition

9 Regulations.

10 ‘‘(ii) Regulations issued for the purpose of clause (i)

11 shall provide for appropriate consideration of the complex12 ity of procurement litigation, generally accepted principles

13 governing the award of legal fees in civil actions involving

14 the United States as a party, and such other factors as

15 may be appropriate.

16 ‘‘(C) In the case of a proceeding referred to in sub17 paragraph (A), contractor costs otherwise allowable as re18 imbursable costs under this paragraph are not allowable

19 if (i) such proceeding involves the same contractor mis20 conduct alleged as the basis of another criminal, civil, or

21 administrative proceeding, and (ii) the costs of such other

22 proceeding are not allowable under paragraph (1).

23 ‘‘(6) In this subsection:

24 ‘‘(A) The term ‘proceeding’ includes an inves25 tigation.
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1 ‘‘(B) The term ‘costs’, with respect to a pro2 ceeding—

3 ‘‘(i) means all costs incurred by a contrac4 tor, whether before or after the commencement

5 of any such proceeding; and

6 ‘‘(ii) includes—

7 ‘‘(I) administrative and clerical ex8 penses;

9 ‘‘(II) the cost of legal services, includ10 ing legal services performed by an em11 ployee of the contractor;

12 ‘‘(III) the cost of the services of ac13 countants and consultants retained by the

14 contractor; and

15 ‘‘(IV) the pay of directors, officers,

16 and employees of the contractor for time

17 devoted by such directors, officers, and em18 ployees to such proceeding.

19 ‘‘(C) The term ‘penalty’ does not include res20 titution, reimbursement, or compensatory damages.

21 ‘‘(l) COVERED CONTRACT DEFINED.—(1) In this sec22 tion, the term ‘covered contract’ means a contract for an

23 amount in excess of $500,000 that is entered into by an

24 executive agency, except that such term does not include

25 a fixed-price contract without cost incentives.
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1 ‘‘(2) Effective on October 1 of each year that is divis2 ible by 5, the amount set forth in paragraph (1) shall be

3 adjusted to the amount that is equal to the fiscal year

4 1994 constant dollar value of the amount set forth. An

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

6 $50,000 shall be rounded to the nearest multiple of

7 $50,000. In the case of an amount that is evenly divisible

8 by $25,000 but is not evenly divisible by $50,000, the

9 amount shall be rounded to the next higher multiple of

10 $50,000.’’.

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

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

13 the item relating to section 306 and inserting in lieu there14 of the following:

‘‘Sec. 306. Allowable costs.’’.

15 PART III—ACQUISITIONS GENERALLY

16 SEC. 2191. TRAVEL EXPENSES OF GOVERNMENT CONTRAC17 TORS.

18 Section 24 of the Office of Federal Procurement Pol19 icy Act (41 U.S.C. 420) is repealed.

20 Subtitle C—Audit and Access to

21 Records

22 PART I—ARMED SERVICES ACQUISITIONS

23 SEC. 2201. CONSOLIDATION AND REVISION OF AUTHORITY

24 TO EXAMINE RECORDS OF CONTRACTORS.

25 (a) AUTHORITY.—
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1 (1) IN GENERAL.—Section 2313 of title 10,

2 United States Code, is amended to read as follows:

3 ‘‘§ 2313. Examination of records of contractor

4 ‘‘(a) AGENCY AUTHORITY.—The head of an agency,

5 acting through an authorized representative—

6 ‘‘(1) is entitled to inspect the plant and audit

7 the records of—

8 ‘‘(A) a contractor performing a cost-reim9 bursement, incentive, time-and-materials, labor10 hour, or price-redeterminable contract, or any

11 combination of such contracts, made by that

12 agency under this chapter; and

13 ‘‘(B) a subcontractor performing any cost14 reimbursement, incentive, time-and-materials,

15 labor-hour, or price-redeterminable subcontract

16 under a contract referred to in subparagraph

17 (A) or under any combination of such contracts;

18 and

19 ‘‘(2) shall, for the purpose of evaluating the ac20 curacy, completeness, and currency of cost or pricing

21 data required to be submitted pursuant to section

22 2306a of this title with respect to a contract or sub23 contract, have the right to examine all records of the

24 contractor or subcontractor related to—
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1 ‘‘(A) the proposal for the contract or sub2 contract;

3 ‘‘(B) the discussions conducted on the pro4 posal;

5 ‘‘(C) pricing of the contract or subcontract;

6 or

7 ‘‘(D) performance of the contract or sub8 contract.

9 ‘‘(b) LIMITATION ON PREAWARD AUDITS RELATING

10 TO INDIRECT COSTS.—The head of an agency may not

11 perform a preaward audit to evaluate proposed indirect

12 costs under any contract, subcontract, or modification to

13 be entered into in accordance with this chapter in any case

14 in which the contracting officer determines that the objec15 tives of the audit can reasonably be met by accepting the

16 results of an audit conducted by any other department or

17 agency of the Federal Government within one year preced18 ing the date of the contracting officer’s determination.

19 ‘‘(c) SUBPOENA POWER.—(1) The Director of the

20 Defense Contract Audit Agency (or any successor agency)

21 may require by subpoena the production of records of a

22 contractor, access to which is provided to the Secretary

23 of Defense or Secretary of a military department by sub24 section (a).
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1 ‘‘(2) Any such subpoena, in the case of contumacy

2 or refusal to obey, shall be enforceable by order of an ap3 propriate United States district court.

4 ‘‘(3) The authority provided by paragraph (1) may

5 not be redelegated.

6 ‘‘(4) The Director (or any successor official) shall

7 submit an annual report to the Secretary of Defense on

8 the exercise of such authority during the preceding year

9 and the reasons why such authority was exercised in any

10 instance. The Secretary shall forward a copy of each such

11 report to the Committees on Armed Services of the Senate

12 and House of Representatives.

13 ‘‘(d) COMPTROLLER GENERAL AUTHORITY.—(1) Ex14 cept as provided in paragraph (2), each contract awarded

15 after using procedures other than sealed bid procedures

16 shall provide that the Comptroller General and his rep17 resentatives are entitled to examine any records of the

18 contractor, or any of its subcontractors, that directly per19 tain to, and involve transactions relating to, the contract

20 or subcontract.

21 ‘‘(2) Paragraph (1) does not apply to a contract or

22 subcontract with a foreign contractor or foreign sub23 contractor if the head of the agency concerned determines,

24 with the concurrence of the Comptroller General or his

25 designee, that the application of that paragraph to the
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1 contract or subcontract would not be in the public interest.

2 However, the concurrence of the Comptroller General or

3 his designee is not required—

4 ‘‘(A) where the contractor or subcontractor is a

5 foreign government or agency thereof or is precluded

6 by the laws of the country involved from making its

7 records available for examination; and

8 ‘‘(B) where the head of the agency determines,

9 after taking into account the price and availability of

10 the property and services from United States

11 sources, that the public interest would be best served

12 by not applying paragraph (1).

13 ‘‘(3) Paragraph (1) may not be construed to require

14 a contractor or subcontractor to create or maintain any

15 record that the contractor or subcontractor does not main16 tain in the ordinary course of business or pursuant to an17 other provision of law.

18 ‘‘(e) LIMITATION.—The right of the head of an agen19 cy under subsection (a), and the right of the Comptroller

20 General under subsection (d), with respect to a contract

21 or subcontract shall expire three years after final payment

22 under such contract or subcontract.

23 ‘‘(f) INAPPLICABILITY TO CERTAIN CONTRACTS.—

24 This section is inapplicable with respect to the following

25 contracts:
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1 ‘‘(1) Contracts for utility services at rates not

2 exceeding those established to apply uniformly to the

3 public, plus any applicable reasonable connection

4 charge.

5 ‘‘(g) RECORDS DEFINED.—In this section, the term

6 ‘records’ includes books, documents, accounting proce7 dures and practices, and other data, regardless of type and

8 regardless of whether such items are in written form, in

9 the form of computer data, or in any other form.’’.

10 (2) CLERICAL AMENDMENT.—The item relating

11 to such section in the table of sections at the begin12 ning of chapter 137 of title 10, United States Code,

13 is amended to read as follows:

‘‘2313. Examination of records of contractor.’’.

14 (b) REPEAL OF SUPERSEDED PROVISION.—

15 (1) REPEAL.—Section 2406 of title 10, United

16 States Code, is repealed.

17 (2) CLERICAL AMENDMENT.—The table of sec18 tions at the beginning of chapter 141 of such title

19 is amended by striking out the item relating to sec20 tion 2406.

21 PART II—CIVILIAN AGENCY ACQUISITIONS

22 SEC. 2251. AUTHORITY TO EXAMINE RECORDS OF CON23 TRACTORS.

24 (a) AUTHORITY.—
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1 (1) IN GENERAL.—Title III of the Federal

2 Property and Administrative Services Act of 1949

3 (41 U.S.C. 251 et seq.), as amended by section

4 1251(a), is further amended by inserting after sec5 tion 304A the following new section:

6 ‘‘EXAMINATION OF RECORDS OF CONTRACTOR

7 ‘‘SEC. 304B. (a) AGENCY AUTHORITY.—The head of

8 an executive agency, acting through an authorized rep9 resentative—

10 ‘‘(1) is entitled to inspect the plant and audit

11 the records of—

12 ‘‘(A) a contractor performing a cost-reim13 bursement, incentive, time-and-materials, labor14 hour, or price-redeterminable contract, or any

15 combination of such contracts, made by that ex16 ecutive agency under this title; and

17 ‘‘(B) a subcontractor performing any cost18 reimbursement, incentive, time-and-materials,

19 labor-hour, or price-redeterminable subcontract

20 under a contract referred to in subparagraph

21 (A) or under any combination of such contracts;

22 and

23 ‘‘(2) shall, for the purpose of evaluating the ac24 curacy, completeness, and currency of cost or pricing

25 data required to be submitted pursuant to section

26 304A with respect to a contract or subcontract, have
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1 the right to examine all records of the contractor or

2 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) LIMITATION ON PREAWARD AUDITS RELATING

12 TO INDIRECT COSTS.—The agency head may not perform

13 a preaward audit to evaluate proposed indirect costs under

14 any contract, subcontract, or modification to be entered

15 into in accordance with this title in any case in which the

16 contracting officer determines that the objectives of the

17 audit can reasonably be met by accepting the results of

18 an audit conducted by any other department or agency

19 of the Federal Government within one year preceding the

20 date of the contracting officer’s determination.

21 ‘‘(c) SUBPOENA POWER.—(1) The agency head may

22 require by subpoena the production of records of a con23 tractor, access to which is provided by subsection (a).
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1 ‘‘(2) Any such subpoena, in the case of contumacy

2 or refusal to obey, shall be enforceable by order of an ap3 propriate United States district court.

4 ‘‘(3) The authority provided by paragraph (1) may

5 not be delegated.

6 ‘‘(4) In the year following a year in which the head

7 of an executive agency exercises the authority provided in

8 paragraph (1), the agency head shall submit to the Com9 mittee on Governmental Affairs of the Senate and the

10 Committee on Government Operations of the House of

11 Representatives a report on the exercise of such authority

12 during such preceding year and the reasons why such au13 thority was exercised in any instance.

14 ‘‘(d) COMPTROLLER GENERAL AUTHORITY.—(1) Ex15 cept as provided in paragraph (2), each contract awarded

16 after using procedures other than sealed bid procedures

17 shall provide that the Comptroller General and his rep18 resentatives are entitled to examine any records of the

19 contractor, or any of its subcontractors, that directly per20 tain to, and involve transactions relating to, the contract

21 or subcontract.

22 ‘‘(2) Paragraph (1) does not apply to a contract or

23 subcontract with a foreign contractor or foreign sub24 contractor if the agency head concerned determines, with

25 the concurrence of the Comptroller General or his des-
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1 ignee, that the application of that paragraph to the con2 tract or subcontract would not be in the public interest.

3 However, the concurrence of the Comptroller General or

4 his designee is not required.

5 ‘‘(3) Paragraph (1) may not be construed to require

6 a contractor or subcontractor to create or maintain any

7 record that the contractor or subcontractor does not main8 tain in the ordinary course of business or pursuant to an9 other provision of law—

10 ‘‘(A) where the contractor or subcontractor is a

11 foreign government or agency thereof or is precluded

12 by the laws of the country involved from making its

13 records available for examination; and

14 ‘‘(B) where the agency head determines, after

15 taking into account the price and availability of the

16 property and services from United States sources,

17 that the public interest would be best served by not

18 applying paragraph (1).

19 ‘‘(e) LIMITATION.—The right of an agency head

20 under subsection (a), and the right of the Comptroller

21 General under subsection (d), with respect to a contract

22 or subcontract shall expire three years after final payment

23 under such contract or subcontract.
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1 ‘‘(f) INAPPLICABILITY TO CERTAIN CONTRACTS.—

2 This section is inapplicable with respect to the following

3 contracts:

4 ‘‘(1) CONTRACTS.—For utility services at rates

5 not exceeding those established to apply uniformly to

6 the public, plus any applicable reasonable connection

7 charge.

8 ‘‘(g) RECORDS DEFINED.—In this section, the term

9 ‘records’ includes books, documents, accounting proce10 dures and practices, and other data, regardless of type and

11 regardless of whether such items are in written form, in

12 the form of computer data, or in any other form.’’.

13 (2) CLERICAL AMENDMENT.—The table of con14 tents in the first section of such Act, as amended by

15 section 1251(b), is further amended by inserting

16 after the item relating to section 304A the following:

‘‘Sec. 304B. Examination of records of contractor.’’.

17 (b) REPEAL OF SUPERSEDED PROVISION.—Section

18 304 of the Federal Property and Administrative Services

19 Act of 1949 (41 U.S.C. 254) is amended by striking out

20 subsection (c).

21 Subtitle D—Cost Accounting

22 Standards

23 SEC. 2301. EXCEPTIONS TO COVERAGE.

24 Section 26(f)(2) of the Office of Federal Procurement

25 Policy Act (41 U.S.C. 422(f)(2)) is amended—
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1 (1) by inserting ‘‘(A)’’ after ‘‘(2)’’;

2 (2) by striking out ‘‘, other than contracts or

3 subcontracts’’ and all that follows and inserting in

4 lieu thereof a period; and

5 (3) by inserting at the end the following:

6 ‘‘(B) Subparagraph (A) does not apply to the follow7 ing contracts or subcontracts:

8 ‘‘(i) Contracts or subcontracts where the price

9 negotiated is based on established catalog or market

10 prices of commercial items sold in substantial quan11 tities to the general public.

12 ‘‘(ii) Contracts or subcontracts where the price

13 negotiated is based on prices set by law or regula14 tion.

15 ‘‘(iii) Any other firm fixed-price contract or

16 subcontract for commercial items which is excepted

17 from the requirement to provide cost or pricing data

18 pursuant to subsection (b) or (d) of section 2306a

19 of title 10, United States Code, or subsection (b) or

20 (d) of section 304A of the Federal Property and Ad21 ministrative Services Act of 1949.

22 ‘‘(C) In this paragraph, the term ‘subcontract’ in23 cludes a transfer of commercial items between divisions,

24 subsidiaries, or affiliates of a contractor.’’.
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1 SEC. 2302. REPEAL OF OBSOLETE DEADLINE REGARDING

2 PROCEDURAL REGULATIONS FOR THE COST

3 ACCOUNTING STANDARDS BOARD.

4 Section 26(f)(3) of the Office of Federal Procurement

5 Policy Act (41 U.S.C. 422(f)(3)) is amended in the first

6 sentence by striking out ‘‘Not later than 180 days after

7 the date of the enactment of this section, the Adminis8 trator’’ and inserting in lieu thereof ‘‘The Administrator’’.

9 Subtitle E—Administration of Con10 tract Provisions Relating to

11 Price, Delivery, and Product

12 Quality

13 PART I—ARMED SERVICES ACQUISITIONS

14 SEC. 2401. PROCUREMENT OF CRITICAL AIRCRAFT AND

15 SHIP SPARE PARTS; QUALITY CONTROL.

16 (a) REPEAL.—Section 2383 of title 10, United States

17 Code, is repealed.

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

19 at the beginning of chapter 141 of such title is amended

20 by striking out the item relating to section 2383.

21 SEC. 2402. CONTRACTOR GUARANTEES REGARDING WEAP22 ON SYSTEMS.

23 Section 2403(h) of title 10, United States Code, is

24 amended—

25 (1) by redesignating paragraph (2) as para26 graph (3); and
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1 (2) by inserting after paragraph (1) the follow2 ing new paragraph (2):

3 ‘‘(2) The regulations shall include the following:

4 ‘‘(A) Guidelines for negotiating contractor guar5 antees that are reasonable and cost effective, as de6 termined on the basis of the likelihood of defects and

7 the estimated cost of correcting such defects.

8 ‘‘(B) Procedures for administering contractor

9 guarantees.

10 ‘‘(C) Guidelines for determining the cases in

11 which it may be appropriate to waive the require12 ments of this section.’’.

13 PART II—ACQUISITIONS GENERALLY

14 SEC. 2451. SECTION 3737 OF THE REVISED STATUTES: EX15 PANSION OF AUTHORITY TO PROHIBIT

16 SETOFFS AGAINST ASSIGNEES; REORGANIZA17 TION OF SECTION; REVISION OF OBSOLETE

18 PROVISIONS.

19 Section 3737 of the Revised Statutes (41 U.S.C. 15)

20 is amended to read as follows:

21 ‘‘SEC. 3737. (a) No contract or order, or any interest

22 therein, shall be transferred by the party to whom such

23 contract or order is given to any other party, and any such

24 transfer shall cause the annulment of the contract or order

25 transferred, so far as the United States is concerned. All
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1 rights of action, however, for any breach of such contract

2 by the contracting parties, are reserved to the United

3 States.

4 ‘‘(b) The provisions of subsection (a) shall not apply

5 in any case in which the moneys due or to become due

6 from the United States or from any agency or department

7 thereof, under a contract providing for payments aggre8 gating $1,000 or more, are assigned to a bank, trust com9 pany, or other financing institution, including any Federal

10 lending agency, provided:

11 ‘‘(1) That, in the case of any contract entered

12 into after October 9, 1940, no claim shall be as13 signed if it arises under a contract which forbids

14 such assignment.

15 ‘‘(2) That, unless otherwise expressly permitted

16 by such contract, any such assignment shall cover all

17 amounts payable under such contract and not al18 ready paid, shall not be made to more than one

19 party, and shall not be subject to further assign20 ment, except that any such assignment may be made

21 to one party as agent or trustee for two or more

22 parties participating in such financing.

23 ‘‘(3) That, in the event of any such assignment,

24 the assignee thereof shall file written notice of the
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1 assignment together with a true copy of the instru2 ment of the assignment with—

3 ‘‘(A) the contracting officer or the head of

4 his department or agency;

5 ‘‘(B) the surety or sureties upon the bond

6 or bonds, if any, in connection with such con7 tract; and

8 ‘‘(C) the disbursing officer, if any, des9 ignated in such contract to make payment.

10 ‘‘(c) Notwithstanding any law to the contrary govern11 ing the validity of assignments, any assignment pursuant

12 to this section shall constitute a valid assignment for all

13 purposes.

14 ‘‘(d) In any case in which moneys due or to become

15 due under any contract are or have been assigned pursu16 ant to this section, no liability of any nature of the as17 signor to the United States or any department or agency

18 thereof, whether arising from or independently of such

19 contract, shall create or impose any liability on the part

20 of the assignee to make restitution, refund, or repayment

21 to the United States of any amount heretofore since July

22 1, 1950, or hereafter received under the assignment.

23 ‘‘(e) Any contract of the Department of Defense, the

24 General Services Administration, the Department of En25 ergy, or any other department or agency of the United
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1 States designated by the President, except any such con2 tract under which full payment has been made, may, upon

3 a determination of need by the President, provide or be

4 amended without consideration to provide that payments

5 to be made to the assignee of any moneys due or to become

6 due under such contract shall not be subject to reduction

7 or setoff. Each such determination of need shall be pub8 lished in the Federal Register.

9 ‘‘(f) If a provision described in subsection (e) or a

10 provision to the same general effect has been at any time

11 heretofore or is hereafter included or inserted in any such

12 contract, payments to be made thereafter to an assignee

13 of any moneys due or to become due under such contract

14 shall not be subject to reduction or setoff for any liability

15 of any nature of the assignor to the United States or any

16 department or agency thereof which arises independently

17 of such contract, or hereafter for any liability of the as18 signor on account of—

19 ‘‘(1) renegotiation under any renegotiation stat20 ute or under any statutory renegotiation article in

21 the contract;

22 ‘‘(2) fines;

23 ‘‘(3) penalties (which term does not include

24 amounts which may be collected or withheld from
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1 the assignor in accordance with or for failure to

2 comply with the terms of the contract); or

3 ‘‘(4) taxes, social security contributions, or the

4 withholding or non withholding of taxes or social se5 curity contributions, whether arising from or inde6 pendently of such contract.

7 ‘‘(g) Except as herein otherwise provided, nothing in

8 this section shall be deemed to affect or impair rights of

9 obligations heretofore accrued.’’.

10 SEC. 2452. REPEAL OF REQUIREMENT FOR DEPOSIT OF

11 CONTRACTS WITH GAO.

12 Section 3743 of the Revised Statutes (41 U.S.C. 20)

13 is repealed.

14 Subtitle F—Claims and Disputes

15 PART I—ARMED SERVICES ACQUISITIONS

16 SEC. 2501. CERTIFICATION OF CONTRACT CLAIMS.

17 (a) DOD CERTIFICATION REQUIREMENT IN CON18 FLICT WITH GOVERNMENTWIDE REQUIREMENT.—

19 (1) INAPPLICABILITY OF REQUIREMENT TO

20 CONTRACT CLAIMS.—Section 2410 of title 10, Unit21 ed States Code, is amended to read as follows:

22 ‘‘§ 2410. Requests for equitable adjustment or other

23 relief: certification

24 ‘‘(a) CERTIFICATION REQUIREMENT.—A request for

25 equitable adjustment to contract terms or request for re-
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1 lief under Public Law 85–804 (50 U.S.C. 1431 et seq.)

2 that exceeds the simplified acquisition threshold may not

3 be paid unless a person authorized to certify the request

4 on behalf of the contractor certifies, at the time the re5 quest is submitted, that—

6 ‘‘(1) the request is made in good faith, and

7 ‘‘(2) the supporting data are accurate and com8 plete to the best of that person’s knowledge and be9 lief.’’.

10 (2) CLERICAL AMENDMENT.—The table of sec11 tions at the beginning of chapter 141 of such title

12 is amended by striking out the item relating to sec13 tion 2410 and inserting in lieu thereof the following:

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

14 (b) RESTRICTION ON LEGISLATIVE PAYMENT OF

15 CLAIMS.—Section 2410 of title 10, United States Code,

16 as amended by subsection (a), is further amended by add17 ing at the end the following new subsection:

18 ‘‘(b) RESTRICTION ON LEGISLATIVE PAYMENT OF

19 CLAIMS.—In the case of a contract of an agency named

20 in section 2303(a) of this title, no provision of a law en21 acted after September 30, 1994, that directs the payment

22 of a particular claim under such contract, a particular re23 quest for equitable adjustment to any term of such con24 tract, or a particular request for relief under Public Law
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1 85–804 (50 U.S.C. 1431 et seq.) regarding such contract

2 may be implemented unless such provision of law—

3 ‘‘(1) specifically refers to this subsection; and

4 ‘‘(2) specifically states that this subsection does

5 not apply with respect to the payment directed by

6 that provision of law.’’.

7 (c) DEFINITION.—Section 2410, as amended by sub8 sections (a) and (b), is further amended by adding at the

9 end the following:

10 ‘‘(c) DEFINITION.—In this section, the term ‘sim11 plified acquisition threshold’ has the meaning given that

12 term in section 2302(4) of this title.’’.

13 (d) REPEAL OF RELATED PROVISIONS.—

14 (1) CERTIFICATION REGULATIONS FOR CON15 TRACT CLAIMS EXCEEDING $100,000.—

16 (A) REPEAL.—Section 2410e of title 10,

17 United States Code, is repealed.

18 (B) CLERICAL AMENDMENT.—The table of

19 sections at the beginning of chapter 141 of such

20 title is amended by striking out the item relat21 ing to section 2410e.

22 (2) CONFORMING REPEAL.—Section 813(b) of

23 the National Defense Authorization Act for Fiscal

24 Year 1993 (Public Law 102–484, 106 Stat. 2453),

25 is repealed.
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1 SEC. 2502. SHIPBUILDING CLAIMS.

2 (a) LIMITATION ON PERIOD FOR SUBMISSION.—

3 (1) INCREASED PERIOD.—Subsection (a) of sec4 tion 2405 of title 10, United States Code, is amend5 ed—

6 (A) by striking out ‘‘after December 7,

7 1983,’’ and inserting in lieu thereof ‘‘on or

8 after the date of the enactment of the Federal

9 Acquisition Streamlining Act of 1994’’; and

10 (B) by striking out ‘‘18 months’’ and in11 serting in lieu thereof ‘‘6 years’’.

12 (2) SAVINGS PROVISION.—Notwithstanding the

13 6-year period provided in subsection (a) of section

14 2405 of title 10, United States Code, as amended by

15 paragraph (1), the period applicable under such sub16 section in the case of a shipbuilding contract entered

17 into after December 7, 1983, and before the date of

18 the enactment of the Federal Acquisition Streamlin19 ing Act of 1994 shall continue to be 18 months.

20 (b) RESUBMISSION WITH CORRECTED CERTIFI21 CATION.—Subsection (c) of such section is repealed.
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1 PART II—ACQUISITIONS GENERALLY

2 SEC. 2551. CLAIMS JURISDICTION OF UNITED STATES DIS3 TRICT COURTS AND THE UNITED STATES

4 COURT OF FEDERAL CLAIMS.

5 (a) CONCURRENT JURISDICTION OF UNITED STATES

6 DISTRICT COURTS UNDER THE LITTLE TUCKER ACT.—

7 Subsection (a) of section 1346 of title 28, United States

8 Code, is amended to read as follows:

9 ‘‘(a)(1) The district courts shall have original juris10 diction, concurrent with the United States Court of Fed11 eral Claims, of any civil action against the United States

12 for the recovery of any internal-revenue tax alleged to have

13 been erroneously or illegally assessed or collected, or any

14 penalty claimed to have been collected without authority

15 or any sum alleged to have been excessive or in any man16 ner wrongfully collected under the internal-revenue laws.

17 ‘‘(2)(A) Except as provided in subparagraph (B), the

18 district courts shall have original jurisdiction, concurrent

19 with the United States Court of Federal Claims, of any

20 other civil action or claim against the United States, not

21 exceeding $10,000 in amount, founded either upon the

22 Constitution, or any Act of Congress, or any regulation

23 of an executive department, or upon any express or im24 plied contract with the United States, or for liquidated or

25 unliquidated damages in cases not sounding in tort.
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1 ‘‘(B) The district courts shall not have jurisdiction

2 over any civil action or claim against the United States

3 or any Federal entity which relates in any manner to a

4 contract to which the Contract Disputes Act of 1978 (41

5 U.S.C. 601 et seq.) applies, including a claim that seeks

6 to establish the existence or nonexistence of such a con7 tract, seeks to establish that such a contract is void, or

8 seeks to determine and construe the terms of such a con9 tract. The district courts do not have jurisdiction over any

10 civil action or claim described in the preceding sentence

11 pursuant to section 1331, 1334, or 1346(a)(2)(B) of this

12 title, any provision of law giving a Federal entity the right

13 to sue or be sued in its own name, or any other provision

14 of law.’’.

15 (b) JURISDICTION OF THE UNITED STATES COURT

16 OF FEDERAL CLAIMS UNDER THE TUCKER ACT.—Sec17 tion 1491 of title 28, United States Code, as amended by

18 section 1422, is further amended by inserting after sub19 section (c) the following:

20 ‘‘(d)(1) The United States Court of Federal Claims

21 shall have jurisdiction over any civil action or claim

22 against the United States which relates in any manner to

23 a contract to which the Contract Disputes Act of 1978

24 (41 U.S.C. 601 et seq,) applies, including a civil action

25 or claim that seeks to establish the existence or
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1 nonexistence of such a contract, seeks to establish that

2 such contract is void, or seeks to determine and construe

3 the terms of any such contract.

4 ‘‘(2) The jurisdiction of the United States Court of

5 Federal Claims is, pursuant to section 1346(a)(2)(B) of

6 this title, exclusive as to the district courts of the United

7 States.’’.

8 SEC. 2552. CONTRACT DISPUTES ACT IMPROVEMENTS.

9 (a) PERIOD FOR FILING CLAIMS.—

10 (1) SIX-YEAR LIMITATION.—Section 6 of the

11 Contract Disputes Act of 1978 (41 U.S.C. 605) is

12 amended in subsection (a) by inserting after the sec13 ond sentence the following: ‘‘Each claim by a con14 tractor against the government relating to a contract

15 and each claim by the government against a contrac16 tor relating to a contract shall be submitted within

17 6 years after the occurrence of the event or events

18 giving rise to the claim. The preceding sentence does

19 not apply to a claim by the government against a

20 contractor that is based on a claim by the contractor

21 involving fraud.’’.

22 (2) LIMITATION ON APPLICABILITY TO EXIST23 ING CONTRACTS.—Notwithstanding the third sen24 tence of section 6(a) of the Contract Disputes Act

25 of 1978, as added by paragraph (1), if a contract in
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1 existence on the date of the enactment of this Act

2 requires that a claim referred to in that sentence be

3 submitted earlier than 6 years after the occurrence

4 of the event or events giving rise to the claim, then

5 the claim shall be submitted within the period re6 quired by the contract. The preceding sentence does

7 not apply to a claim by the Federal Government

8 against a contractor that is based on a claim by the

9 contractor involving fraud.

10 (b) INCREASED THRESHOLD FOR CERTIFICATION,

11 DECISION, AND NOTIFICATION REQUIREMENTS.—Sub12 section (c) of such section is amended by striking out

13 ‘‘$50,000’’ each place it appears and inserting in lieu

14 thereof ‘‘$100,000’’.

15 (c) INCREASED MAXIMUM FOR APPLICABILITY OF

16 ACCELERATED PROCEDURES.—Section 8(f) of the Con17 tract Disputes Act of 1978 (41 U.S.C. 607(f)) is amended

18 by striking out ‘‘$50,000’’ in the first sentence and insert19 ing in lieu thereof ‘‘$150,000’’.

20 (d) INCREASED MAXIMUM FOR APPLICABILITY OF

21 SMALL CLAIMS PROCEDURE.—Section 9(a) of the Con22 tract Disputes Act of 1978 (41 U.S.C. 608(a)) is amended

23 by striking out ‘‘$10,000’’ in the first sentence and insert24 ing in lieu thereof ‘‘$50,000’’.
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1 (e) REDUCED PERIOD FOR FILING ACTION IN COURT

2 OF FEDERAL CLAIMS.—Section 10(a)(3) of such Act (41

3 U.S.C. 609(a)(3)) is amended by striking out ‘‘twelve

4 months’’ and inserting in lieu thereof ‘‘90 days’’.

5 SEC. 2553. EXTENSION OF ALTERNATIVE DISPUTE RESOLU6 TION AUTHORITY.

7 Section 6(e) of the Contracts Disputes Act of 1978

8 (41 U.S.C. 605(e)) is amended by striking out ‘‘October

9 1, 1995’’ and inserting in lieu thereof ‘‘October 1, 1999’’.

10 SEC. 2554. EXPEDITED RESOLUTION OF CONTRACT ADMIN11 ISTRATION COMPLAINTS.

12 (a) REGULATIONS REQUIRED.—The Federal Acquisi13 tion Regulation shall include provisions that require a con14 tracting officer—

15 (1) to make every reasonable effort to respond

16 in writing within 30 days to any written request for

17 a contracting officer’s decision with respect to a

18 matter relating to the administration of a contract

19 that is received from a small business concern; and

20 (2) in the event that the contracting officer is

21 unable to render a decision within the 30-day period,

22 to transmit to the contractor within such period a

23 written notification of a specific date by which the

24 contracting officer expects to reach a decision.
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1 (b) RULE OF CONSTRUCTION.—Nothing in this pro2 vision shall be considered as creating any rights under the

3 Contract Disputes Act (41 U.S.C. 601 et seq.).

4 (c) DEFINITION.—In this section, the term ‘‘small

5 business concern’’ means a business concern that meets

6 the requirements of section 3(a) of the Small Business Act

7 (15 U.S.C. 632(a)) and the regulations promulgated pur8 suant to that section.

9 TITLE III—SERVICE SPECIFIC

10 AND MAJOR SYSTEMS STATUTES

11 Subtitle A—Major Systems Statutes

12 SEC. 3001. REQUIREMENT FOR INDEPENDENT COST ESTI13 MATES AND MANPOWER ESTIMATES BEFORE

14 DEVELOPMENT OR PRODUCTION.

15 (a) CONTENT AND SUBMISSION OF ESTIMATES.—

16 Section 2434 of title 10, United States Code, is amended

17 by striking out subsection (b) and inserting in lieu thereof

18 the following:

19 ‘‘(b) REGULATIONS.—The Secretary of Defense shall

20 prescribe regulations governing the content and submis21 sion of the estimates required by subsection (a). The regu22 lations shall require—

23 ‘‘(1) that the independent estimate of the cost

24 of a program—
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1 ‘‘(A) be prepared by an office or other en2 tity that is not under the supervision, direction,

3 or control of the military department, Defense

4 Agency, or other component of the Department

5 of Defense that is directly responsible for carry6 ing out the development or acquisition of the

7 program; and

8 ‘‘(B) include all costs of development, pro9 curement, and operations and support, without

10 regard to funding source or management con11 trol; and

12 ‘‘(2) that the manpower estimate include the

13 total personnel required to train for, operate, main14 tain, and support the program upon full operational

15 deployment.’’.

16 (b) TERMINOLOGY CORRECTION.—Subsection (a) of

17 such section is amended by striking out ‘‘full-scale engi18 neering development’’ and inserting in lieu thereof ‘‘engi19 neering and manufacturing development’’.

20 SEC. 3002. ENHANCED PROGRAM STABILITY.

21 (a) BASELINE DESCRIPTIONS AND DEVIATION RE22 PORTING.—Section 2435 of title 10, United States Code,

23 is amended—

24 (1) in subsection (a)—

25 (A) by striking out paragraph (2); and
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1 (B) in paragraph (1)—

2 (i) by striking out ‘‘(1)’’; and

3 (ii) by redesignating subparagraphs

4 (A) and (B) as paragraphs (1) and (2), re5 spectively; and

6 (2) by striking out subsection (b) and inserting

7 in lieu thereof the following:

8 ‘‘(b) REGULATIONS.—The Secretary of Defense shall

9 prescribe regulations governing—

10 ‘‘(1) the content of baseline descriptions, which

11 shall include the program cost, the program sched12 ule, and a program performance description;

13 ‘‘(2) the submission of reports on deviations of

14 a program from the baseline description by the pro15 gram manager to the Secretary of the military de16 partment concerned and the Under Secretary of De17 fense for Acquisition and Technology;

18 ‘‘(3) procedures for review of deviation reports

19 within the Department of Defense; and

20 ‘‘(4) procedures for submission and approval of

21 revised baseline descriptions.

22 ‘‘(c) BASELINE DESCRIPTION REQUIRED BEFORE

23 OBLIGATION OF FUNDS.—(1) Except as provided in para24 graph (2), no amount appropriated or otherwise made

25 available to the Department of Defense may be obligated
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1 for a major defense acquisition program before a baseline

2 description for the program is approved in accordance with

3 the procedures prescribed pursuant to subsection (b)(4).

4 ‘‘(2) An obligation otherwise prohibited by paragraph

5 (1) may be incurred if approved in advance by the Under

6 Secretary of Defense for Acquisition and Technology.’’.

7 (b) TERMINOLOGY CORRECTION.—Subsection (a)(1)

8 of such section, as redesignated by subsection

9 (a)(1)(B)(ii), is amended by striking out ‘‘full-scale engi10 neering development’’ and inserting in lieu thereof ‘‘engi11 neering and manufacturing development’’.

12 SEC. 3003. REPEAL OF REQUIREMENT TO DESIGNATE CER13 TAIN MAJOR DEFENSE ACQUISITION PRO14 GRAMS AS DEFENSE ENTERPRISE PRO15 GRAMS.

16 Section 809 of the National Defense Authorization

17 Act for Fiscal Year 1991 (Public Law 101–510; 10 U.S.C.

18 2430 note) is amended—

19 (1) by striking out subsection (d); and

20 (2) by redesignating subsections (e), (f), (g),

21 and (h) as subsections (d), (e), (f), and (g), respec22 tively.
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1 SEC. 3004. REPEAL OF REQUIREMENT FOR COMPETITIVE

2 PROTOTYPING IN MAJOR PROGRAMS.

3 (a) REPEAL.—Section 2438 of title 10, United States

4 Code, is repealed.

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

6 at the beginning of chapter 144 of such title is amended

7 by striking out the item relating to section 2438.

8 SEC. 3005. REPEAL OF REQUIREMENT FOR COMPETITIVE

9 ALTERNATIVE SOURCES IN MAJOR PRO10 GRAMS.

11 (a) REPEAL.—Section 2439 of title 10, United States

12 Code, is repealed.

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

14 at the beginning of chapter 144 of such title is amended

15 by striking out the item relating to section 2439.

16 Subtitle B—Testing Statutes

17 SEC. 3011. DIRECTOR OF OPERATIONAL TEST AND EVALUA18 TION TO REPORT DIRECTLY TO SECRETARY

19 OF DEFENSE.

20 Section 139(c) of title 10, United States Code, is

21 amended by inserting after ‘‘(c)’’ the following: ‘‘The Di22 rector reports directly, without intervening review or ap23 proval, to the Secretary of Defense and Deputy Secretary

24 of Defense personally.’’.
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1 SEC. 3012. RESPONSIBILITY OF DIRECTOR OF OPER2 ATIONAL TEST AND EVALUATION FOR LIVE

3 FIRE TESTING.

4 (a) CONDUCT OF LIVE FIRE TESTING.—Subsection

5 (b) of section 139 of title 10, United States Code, is

6 amended—

7 (1) by striking out ‘‘and’’ at the end of para8 graph (4);

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

10 paragraph (5) and inserting in lieu thereof ‘‘; and’’;

11 and

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

13 paragraph:

14 ‘‘(6) conduct the live fire testing activities of

15 the Department of Defense provided for under sec16 tion 2366 of this title.’’.

17 (b) ANNUAL REPORT ON LIVE FIRE TESTING.—Sub18 section (f) of such section is amended by inserting ‘‘(in19 cluding live fire testing activities)’’ in the first sentence

20 after ‘‘operational test and evaluation activities’’.

21 SEC. 3013. REQUIREMENT FOR UNCLASSIFIED VERSION OF

22 ANNUAL REPORT ON OPERATIONAL TEST

23 AND EVALUATION.

24 Section 139(f) of title 10, United States Code, is

25 amended by inserting after the second sentence the follow26 ing new sentence: ‘‘If the Director submits the report to
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1 Congress in a classified form, the Director shall concur2 rently submit an unclassified version of the report to Con3 gress.’’.

4 Subtitle C—Service Specific Laws

5 SEC. 3021. GRATUITOUS SERVICES OF OFFICERS OF CER6 TAIN RESERVE COMPONENTS.

7 Section 279 of title 10, United States Code, is

8 amended—

9 (1) by striking out ‘‘Notwithstanding’’ and in10 serting in lieu thereof ‘‘(a) ACCEPTANCE BY SEC11 RETARY OF A MILITARY DEPARTMENT.—Notwith12 standing’’; and

13 (2) by adding at the end the following new sub14 section:

15 ‘‘(b) ACCEPTANCE BY SECRETARY OF DEFENSE.—

16 Notwithstanding section 1342 of title 31, the Secretary

17 of Defense may accept the gratuitous services of an officer

18 of a reserve component (other than an officer of the Army

19 National Guard of the United States or the Air National

20 Guard of the United States) in consultation upon matters

21 relating to the armed forces.’’.

22 SEC. 3022. AUTHORITY TO RENT SAMPLES, DRAWINGS, AND

23 OTHER INFORMATION TO OTHERS.

24 Subchapter V of chapter 148 of title 10, United

25 States Code, is amended in section 2541(a) by inserting
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1 ‘‘rent,’’ after ‘‘sell,’’ each place it appears in paragraphs

2 (1) and (2).

3 SEC. 3023. CIVIL RESERVE AIR FLEET.

4 (a) DEFINITIONS.—Section 9511 of title 10, United

5 States Code, is amended—

6 (1) in paragraph (1)—

7 (A) by inserting ‘‘ ‘civil aircraft’,’’ after

8 ‘‘ ‘person’,’’;

9 (B) by striking out ‘‘meaning’’ and insert10 ing in lieu thereof ‘‘meanings’’; and

11 (C) by striking out ‘‘(49 U.S.C. 1301)’’

12 and inserting in lieu thereof ‘‘(49 U.S.C. App.

13 1301)’’;

14 (2) in paragraph (2), by striking out ‘‘pas15 senger-cargo’’ and inserting in lieu thereof ‘‘pas16 senger cargo’’;

17 (3) in paragraph (3), by striking out ‘‘cargo-ca18 pable’’ and inserting in lieu thereof ‘‘cargo capable’’;

19 (4) by striking out paragraph (5) and inserting

20 in lieu thereof the following:

21 ‘‘(5) The term ‘cargo convertible aircraft’

22 means a passenger aircraft equipped or designed so

23 that all or substantially all of the main deck of the

24 aircraft can be readily converted for the carriage of

25 property or mail.’’;
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1 (5) by striking out paragraph (6);

2 (6) by redesignating paragraph (7) as para3 graph (6);

4 (7) by redesignating paragraph (8) as para5 graph (7) and—

6 (A) in subparagraph (A) of such para7 graph, by inserting ‘‘under section 9512 of this

8 title’’ after ‘‘and who contracts with the Sec9 retary’’;

10 (B) by striking out ‘‘or’’ at the end of such

11 subparagraph (A); and

12 (C) by inserting before the period at the

13 end of such paragraph the following: ‘‘, or (C)

14 who owns or controls existing aircraft, or will

15 own or control new aircraft, and who contrac16 tually commits all or some of such aircraft to

17 the Civil Reserve Air Fleet’’;

18 (8) by redesignating paragraphs (9), (10), (11),

19 and (12) as paragraphs (8), (9), (10), and (11), re20 spectively; and

21 (9) in paragraph (11), as so redesignated—

22 (A) by striking out ‘‘interoperability’’ and

23 inserting in lieu thereof ‘‘compatibility’’; and

24 (B) by striking out ‘‘a cargo-convertible,

25 cargo-capable, or passenger-cargo combined air-
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1 craft’’ and inserting in lieu thereof ‘‘an

2 aeromedical aircraft or a cargo convertible,

3 cargo capable, or passenger cargo combined air4 craft’’.

5 (b) CONSOLIDATION OF PROVISIONS RELATING TO

6 CONTRACTUAL COMMITMENT OF AIRCRAFT.—Chapter

7 931 of such title is amended—

8 (1) by redesignating subsections (b) and (c) of

9 section 9512 as subsections (c) and (d), respectively;

10 (2) by redesignating subsection (a) of section

11 9513 as subsection (b), transferring such subsection

12 (as so redesignated) to section 9512, and inserting

13 such subsection after subsection (a);

14 (3) by redesignating subsection (b) of section

15 9513 as subsection (e) and transferring such sub16 section (as so redesignated) to the end of section

17 9512;

18 (4) in subsection (c) of section 9512, as redes19 ignated by paragraph (1), by striking out ‘‘the terms

20 required by section 9513 of this title and’’;

21 (5) in subsection (e) of section 9512, as redes22 ignated and transferred to such section by para23 graph (3), by striking out ‘‘under section 9512 of

24 this title’’ and inserting in lieu thereof ‘‘entered into

25 under this section’’; and
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1 (6) by striking out the heading of section 9513.

2 (c) USE OF MILITARY INSTALLATIONS BY CONTRAC3 TORS.—

4 (1) AUTHORITY.—Such chapter, as amended by

5 subsection (b), is further amended by adding at the

6 end the following new section 9513:

7 ‘‘§ 9513. Use of military installations by Civil Reserve

8 Air Fleet contractors

9 ‘‘(a) CONTRACT AUTHORITY.—(1) The Secretary of

10 the Air Force—

11 ‘‘(A) may, by contract entered into with any

12 contractor, authorize such contractor to use one or

13 more Air Force installations designated by the Sec14 retary; and

15 ‘‘(B) with the consent of the Secretary of an16 other military department, may, by contract entered

17 into with any contractor, authorize the contractor to

18 use one or more installations, designated by the Sec19 retary of the Air Force, that is under the jurisdic20 tion of the Secretary of such other military depart21 ment.

22 ‘‘(2) The Secretary of the Air Force may include in

23 the contract such terms and conditions as the Secretary

24 determines appropriate to promote the national defense or

25 to protect the interests of the United States.
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1 ‘‘(b) PURPOSES OF USE.—A contract entered into

2 under subsection (a) may authorize use of a designated

3 installation as a weather alternate, a service stop not in4 volving the enplaning or deplaning of passengers or cargo,

5 or, in the case of an installation within the United States,

6 for other commercial purposes. Notwithstanding any other

7 provision of the law, the Secretary may establish different

8 levels and types of uses for different installations for com9 mercial operations not required by the Department of De10 fense and may provide in contracts under subsection (a)

11 for different levels and types of uses by different contrac12 tors.

13 ‘‘(c) DISPOSITION OF PAYMENTS FOR USE.—Not14 withstanding any other provision of law, amounts collected

15 from the contractor for landing fees, services, supplies, or

16 other charges authorized to be collected under the contract

17 shall be credited to the appropriations of the armed forces

18 having jurisdiction over the military installation to which

19 the contract pertains. Amounts so credited to an appro20 priation shall be available for obligation for the same pe21 riod as the appropriation to which credited.

22 ‘‘(d) HOLD HARMLESS REQUIREMENT.—A contract

23 entered into under subsection (a) shall provide that the

24 contractor agrees to indemnify and hold harmless the

25 United States from all actions, suits, or claims of any sort
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1 resulting from, relating to, or arising out of any activities

2 conducted, or services or supplies furnished, in connection

3 with the contract.

4 ‘‘(e) RESERVATION OF RIGHT TO EXCLUDE CON5 TRACTOR.—A contract entered into under subsection (a)

6 shall provide that the Secretary or, in the case of an instal7 lation under the jurisdiction of an armed force other than

8 the Air Force, the Secretary concerned may at any time

9 and without prior notice deny access to an installation des10 ignated under the contract if military exigencies require

11 such action.’’.

12 (2) CLERICAL AMENDMENT.—The table of sec13 tions at the beginning of such chapter is amended

14 by striking out the item relating to section 9513 and

15 inserting in lieu thereof the following:

‘‘9513. Use of military installations by Civil Reserve Air Fleet contractors.’’.

16 SEC. 3024. EXCHANGE OF PERSONNEL.

17 (a) EXCHANGE AUTHORITY.—Subchapter II of chap18 ter 138 of title 10, United States Code, is amended by

19 adding at the end the following new section:

20 ‘‘§ 2350k. Exchange of personnel

21 ‘‘(a) INTERNATIONAL EXCHANGE AGREEMENTS AU22 THORIZED.—Under regulations prescribed by the Sec23 retary of Defense, the Secretary and the secretaries of the

24 military departments are each authorized to enter into

25 agreements with the governments of foreign countries for
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1 the exchange of military and civilian personnel of the De2 partment of Defense and military and civilian personnel

3 of the defense departments or ministries of such foreign

4 governments.

5 ‘‘(b) ASSIGNMENT OF PERSONNEL.—Pursuant to

6 such agreements, personnel of the foreign defense depart7 ments or ministries may be assigned to positions in the

8 Department of Defense, and personnel of the Department

9 of Defense may be assigned to positions in foreign defense

10 departments or ministries. Agreements for the exchange

11 of personnel engaged in research and development activi12 ties may provide for assignments to positions in private

13 industry that support the defense departments or min14 istries. The specific positions and the individuals to be as15 signed must be acceptable to both the sending government

16 and the host government.

17 ‘‘(c) RECIPROCITY OF PERSONNEL QUALIFICATIONS

18 REQUIRED.—Each government shall be required under an

19 agreement authorized by subsection (a) to provide person20 nel having qualifications, training, and skills that are es21 sentially equal to those of the personnel provided by the

22 other government.

23 ‘‘(d) PAYMENT OF PERSONNEL COSTS.—Each gov24 ernment shall pay the salary, per diem, cost of living, trav25 el, cost of language or other training, and other costs (ex-
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1 cept for cost of temporary duty directed by the host gov2 ernment and costs incident to the use of host government

3 facilities in the performance of assigned duties) for its own

4 personnel in accordance with the laws and regulations of

5 such government that pertain to such matters.’’.

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

7 at the beginning of subchapter II of such chapter is

8 amended by adding at the end the following new item:

‘‘2350k. Exchange of personnel.’’.

9 SEC. 3025. SCIENTIFIC INVESTIGATION AND RESEARCH

10 FOR THE NAVY.

11 (a) REPEAL.—Section 7203 of title 10, United States

12 Code, is repealed.

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

14 at the beginning of chapter 631 of such title is amended

15 by striking out the item relating to section 7203.

16 SEC. 3026. CONSTRUCTION OF COMBATANT AND ESCORT

17 VESSELS AND ASSIGNMENT OF VESSEL

18 PROJECTS.

19 (a) REPEAL OF OBSOLETE AND INTERNALLY INCON20 SISTENT PROVISIONS.—Section 7299a of title 10, United

21 States Code, is amended—

22 (1) by striking out subsection (a); and

23 (2) by redesignating subsections (b) and (c) as

24 subsections (a) and (b), respectively.
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1 (b) CONFORMING AMENDMENT.—Subsection (b) of

2 such section, as redesignated by subsection (a)(2), is

3 amended in paragraph (2) by striking out ‘‘subsection (a)

4 or’’.

5 SEC. 3027. REPEAL OF REQUIREMENT FOR CONSTRUCTION

6 OF VESSELS ON PACIFIC COAST.

7 (a) REPEAL.—Section 7302 of title 10, United States

8 Code, is repealed.

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

10 at the beginning of chapter 633 of such title is amended

11 by striking out the item relating to section 7302.

12 SEC. 3028. AUTHORITY TO TRANSFER BY GIFT A VESSEL

13 STRICKEN FROM NAVAL VESSEL REGISTER.

14 Section 7306(a)(1) of title 10, United States Code,

15 is amended by inserting ‘‘Territory,’’ after ‘‘State,’’.

16 SEC. 3029. NAVAL SALVAGE FACILITIES.

17 Chapter 637 of title 10, United States Code, is

18 amended—

19 (1) in section 7361—

20 (A) in subsection (a), by inserting ‘‘AU21 THORITY TO PROVIDE FACILITIES BY CON22 TRACT OR OTHERWISE.—’’ after ‘‘(a)’’;

23 (B) in subsection (b), by inserting ‘‘CON24 TRACTS AFFECTING THE DEPARTMENT OF

25 TRANSPORTATION.—’’ after ‘‘(b)’’; and
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1 (C) by striking out subsection (c) and in2 serting in lieu thereof the following new sub3 section (c):

4 ‘‘(c) LIMITATION ON TERM CONTRACTS.—Term con5 tracts may be entered into for purposes of this section only

6 after—

7 ‘‘(1) it has been demonstrated to the satisfac8 tion of the Secretary of the Navy that available com9 mercial salvage facilities are inadequate to meet na10 tional defense requirements; and

11 ‘‘(2) the Secretary of the Navy determines that

12 adequate public notice of intent to exercise the au13 thority under this subsection has been provided.’’;

14 (2) by designating the text of section 7362 as

15 subsection (d) and transferring such text, as so des16 ignated, to the end of section 7361 of title 10,

17 United States Code;

18 (3) in subsection (d) of section 7361 of such

19 title, as so designated and transferred, by inserting

20 before ‘‘The Secretary’’ the following: ‘‘COMMERCIAL

21 USE OF NAVAL VESSELS AND EQUIPMENT.—’’;

22 (4) by designating the text of section 7363 as

23 subsection (e) and transferring such text, as so des24 ignated, to the end of section 7361 of title 10,

25 United States Code;
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1 (5) in subsection (e) of section 7361 of such

2 title, as so designated and transferred, by inserting

3 before ‘‘Before any salvage vessel’’ the following:

4 ‘‘CONDITIONS FOR TRANSFER OF EQUIPMENT.—’’;

5 (6) by designating the text of section 7365 as

6 subsection (f) and transferring such text, as so des7 ignated, to the end of section 7361 of title 10,

8 United States Code;

9 (7) in subsection (f) of section 7361 of such

10 title, as so designated and transferred, by inserting

11 before ‘‘The Secretary’’ the following: ‘‘SETTLE12 MENT OF CLAIMS.—’’;

13 (8) by designating the text of section 7367 as

14 subsection (g) and transferring such text, as so des15 ignated, to the end of section 7361 of title 10,

16 United States Code;

17 (9) in subsection (g) of section 7361 of such

18 title, as so designated and transferred—

19 (A) by inserting before ‘‘Money received’’

20 the following: ‘‘DISPOSITION OF RECEIPTS.—’’;

21 and

22 (B) by striking out ‘‘this chapter’’ in the

23 first sentence and inserting in lieu thereof ‘‘this

24 section’’;
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1 (10) by striking out the section headings for

2 sections 7362, 7363, 7365, and 7367;

3 (11) by striking out the heading for section

4 7361 and inserting in lieu thereof the following:

5 ‘‘§ 7361. Navy support for salvage operations’’;

6 and

7 (12) in the table of sections at the beginning of

8 such chapter—

9 (A) by striking out the item relating to

10 section 7361 and inserting in lieu thereof the

11 following:

‘‘7361. Navy support for salvage operations.’’;

12 and

13 (B) by striking out the items relating to

14 sections 7362, 7363, 7365, and 7367.

15 Subtitle D—Department of Defense

16 Commercial and Industrial Ac17 tivities

18 SEC. 3051. FACTORIES AND ARSENALS: MANUFACTURE AT.

19 (a) CONSOLIDATION AND REVISION OF AUTHOR20 ITY.—

21 (1) AUTHORITY.—Subchapter V of chapter 148

22 of title 10, United States Code is amended by add23 ing at the end the following:
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1 ‘‘§ 2542. Factories and arsenals: manufacture at

2 ‘‘(a) The Secretary of Defense or the Secretary of

3 a military department may have supplies needed for the

4 Department of Defense or such military department, as

5 the case may be, made in factories or arsenals owned by

6 the United States.

7 ‘‘(b) The Secretary of Defense or the Secretary of

8 the military department concerned may abolish any

9 United States arsenal that such Secretary considers un10 necessary.’’.

11 (2) TECHNICAL AMENDMENT.—The table of

12 sections at the beginning of subchapter V of such

13 chapter is amended by adding at the end the follow14 ing new item:

‘‘2542. Factories and arsenals: manufacture at.’’.

15 (b) REPEAL OF SUPERSEDED AUTHORITY.—

16 (1) ARMY AUTHORITY.—

17 (A) REPEAL.—Section 4532 of title 10,

18 United States Code, is repealed.

19 (B) CLERICAL AMENDMENT.—The table of

20 sections at the beginning of chapter 433 of such

21 title is amended by striking out the item relat22 ing to section 4532.

23 (2) AIR FORCE AUTHORITY.—

24 (A) REPEAL.—Section 9532 of title 10,

25 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 9532.

5 SEC. 3052. ACCOUNTING REQUIREMENT FOR CONTRACTED

6 ADVISORY AND ASSISTANCE SERVICES.

7 (a) FUNDING TO BE IDENTIFIED IN BUDGET.—Sec8 tion 1105 of title 31, United States Code, is amended by

9 adding at the end the following new subsection:

10 ‘‘(g)(1) The Director of the Office of Management

11 and Budget shall establish the funding for advisory and

12 assistance services for each department and agency as a

13 separate object class in each budget annually submitted

14 to the Congress under this section.

15 ‘‘(2)(A) In paragraph (1), except as provided in sub16 paragraph (B), the term ‘advisory and assistance services’

17 means the following services when provided by nongovern18 mental sources:

19 ‘‘(i) Management and professional support serv20 ices.

21 ‘‘(ii) Studies, analyses, and evaluations.

22 ‘‘(iii) Engineering and technical services.

23 ‘‘(B) In paragraph (1), the term ‘advisory and assist24 ance services’ does not include the following services:
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1 ‘‘(i) Routine automated data processing and

2 telecommunications services (as defined in the Fed3 eral Information Resources Management Regulation

4 prescribed by the Administrator of General Services)

5 unless such services are an integral part of a con6 tract for the procurement of advisory and assistance

7 services.

8 ‘‘(ii) Architectural and engineering services.

9 ‘‘(iii) Technical support of research and devel10 opment activities.

11 ‘‘(iv) Research on basic mathematics or medi12 cal, biological, physical, social, psychological, or

13 other phenomena.’’.

14 (b) REPEAL OF SOURCE LAW.—Section 512 of Pub15 lic Law 102–394 (106 Stat. 1826) is repealed.

16 (c) REPEAL OF SUPERSEDED PROVISIONS.—

17 (1) TITLE 10.—

18 (A) REPEAL.—Section 2212 of title 10,

19 United States Code, is repealed.

20 (B) CLERICAL AMENDMENT.—The table of

21 sections at the beginning of chapter 131 of such

22 title is amended by striking out the item relat23 ing to section 2212.

24 (2) TITLE 31.—
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1 (A) REPEAL.—Section 1114 of title 31,

2 United States Code, is repealed.

3 (B) CLERICAL AMENDMENT.—The table of

4 sections at the beginning of chapter 11 of such

5 title is amended by striking out the item relat6 ing to section 1114.

7 Subtitle E—Fuel- and Energy8 Related Laws

9 SEC. 3061. LIQUID FUELS AND NATURAL GAS: CONTRACTS

10 FOR STORAGE, HANDLING, OR DISTRIBU11 TION.

12 Section 2388(a) of title 10, United States Code, is

13 amended by striking out ‘‘liquid fuels and natural gas’’

14 and inserting in lieu thereof ‘‘liquid fuels or natural gas’’.

15 Subtitle F—Fiscal Statutes

16 SEC. 3071. DISBURSEMENT OF FUNDS OF MILITARY DE17 PARTMENT TO COVER OBLIGATIONS OF AN18 OTHER AGENCY OF DEPARTMENT OF DE19 FENSE.

20 Subsection (c)(2) of section 3321 of title 31, United

21 States Code, is amended by striking out ‘‘military depart22 ments of the’’ and inserting in lieu thereof ‘‘The’’.
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1 Subtitle G—Miscellaneous

2 SEC. 3081. OBLIGATION OF FUNDS: LIMITATION.

3 Section 2202 of title 10, United States Code, is

4 amended to read as follows:

5 ‘‘§ 2202. Obligation of funds: limitation

6 ‘‘The Secretary of Defense shall prescribe regulations

7 governing the performance within the Department of De8 fense of the procurement, production, warehousing, and

9 supply distribution functions, and related functions, of the

10 Department of Defense.’’.

11 SEC. 3082. REPEAL OF REQUIREMENTS REGARDING PROD12 UCT EVALUATION ACTIVITIES.

13 (a) REPEAL.—Section 2369 of title 10, United States

14 Code, is repealed.

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

16 at the beginning of chapter 139 of such title is amended

17 by striking out the item related to section 2369.

18 SEC. 3083. 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 ‘‘§ 2410l. 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:

‘‘2410l. Lease 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.

17 SEC. 3084. SOFT DRINK SUPPLIES FOR EXCHANGE STORES.

18 Section 2424 of title 10, United States Code, is

19 amended by adding at the end the following new sub20 section:

21 ‘‘(c) Paragraphs (1) and (2) of subsection (b) do not

22 apply to contracts for the procurement of soft drinks that

23 are manufactured in the United States. The Secretary of

24 Defense shall prescribe in regulations the standards and

25 procedures for determining whether a particular drink is
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1 a soft drink and whether the drink was manufactured in

2 the United States.’’.

3 SEC. 3085. REPEAL OF PREFERENCE FOR RECYCLED

4 TONER CARTRIDGES.

5 The following provisions of law, relating to a pref6 erence for procurement of recycled toner cartridges, are

7 repealed:

8 (1) Section 630 of Public Law 102–393 (106

9 Stat. 1773) and the provision of law set out in

10 quotes in that section (42 U.S.C. 6962(j)).

11 (2) Section 401 of Public Law 103–123 (107

12 Stat. 1238).

13 TITLE IV—SIMPLIFIED ACQUISI14 TION THRESHOLD AND SO15 CIOECONOMIC, SMALL BUSI16 NESS, AND MISCELLANEOUS

17 LAWS

18 Subtitle A—Simplified Acquisition

19 Threshold

20 PART I—ESTABLISHMENT OF THRESHOLD

21 SEC. 4001. SIMPLIFIED ACQUISITION THRESHOLD.

22 (a) TERM DEFINED.—Section 4(11) of the Office of

23 Federal Procurement Policy Act (41 U.S.C. 403(11)) is

24 amended to read as follows:
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1 ‘‘(11) The term ‘simplified acquisition thresh2 old’ means $100,000.’’.

3 (b) INTERIM REPORTING RULE.—Until October 1,

4 1999, procuring activities shall continue to report procure5 ment awards with a dollar value of at least $25,000, but

6 less than $100,000, in conformity with the procedures for

7 the reporting of a contract award in excess of $25,000

8 that were in effect on October 1, 1992.

9 PART II—SIMPLIFICATION OF PROCEDURES

10 SEC. 4011. SIMPLIFIED ACQUISITION PROCEDURES.

11 The Office of Federal Procurement Policy Act (41

12 U.S.C. 401 et seq.) is amended by adding at the end the

13 following new section:

14 ‘‘SIMPLIFIED ACQUISITION PROCEDURES

15 ‘‘SEC. 29. (a) In order to promote efficiency and

16 economy in contracting and to avoid unnecessary burdens

17 for agencies and contractors, the Federal Acquisition Reg18 ulation shall provide for special simplified procedures for

19 contracts for acquisition of property and services that are

20 not in excess of the simplified acquisition threshold.

21 ‘‘(b) Regulations prescribed pursuant to subsection

22 (a) shall include the following provisions:

23 ‘‘(1) A provision that a contract with an antici24 pated value not in excess of $2,500 is not subject to

25 section 15(j) of the Small Business Act (15 U.S.C.

26 644(j)) and section 2 of title III of the Act of March
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1 3, 1933 (commonly known as the ‘Buy America

2 Act’) (41 U.S.C. 10a et seq.).

3 ‘‘(2) A provision that a civilian or military offi4 cial, or employee of an agency, whose contracting

5 authority does not exceed $2,500 is not a procure6 ment official for the purposes of section 27 of this

7 Act.

8 ‘‘(3) A provision that a purchase not in excess

9 of $2,500 may be made without obtaining competi10 tive quotations if the contracting officer determines

11 that the price for the purchase is reasonable.

12 ‘‘(4) A requirement that purchases not in ex13 cess of $2,500 be distributed equitably among quali14 fied suppliers.

15 ‘‘(c) A proposed purchase or contract for an amount

16 above the simplified acquisition threshold may not be di17 vided into several purchases or contracts for lesser

18 amounts in order to use the simplified acquisition proce19 dures required by subsection (a).

20 ‘‘(d) In using simplified acquisition procedures, the

21 head of an executive agency shall promote competition to

22 the maximum extent practicable.’’.

23 SEC. 4012. SMALL BUSINESS RESERVATION.

24 Section 15(j) of the Small Business Act (15 U.S.C.

25 644(j)) is amended to read as follows:
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1 ‘‘(j)(1) Each contract for the purchase of goods and

2 services that has an anticipated value in excess of $2,500

3 but not in excess of the simplified acquisition threshold

4 and that is subject to simplified acquisition procedures

5 prescribed pursuant to section 29 of the Office of Federal

6 Procurement Policy Act shall be reserved exclusively for

7 small business concerns unless the contracting officer is

8 unable to obtain offers from two or more small business

9 concerns that are competitive with market prices and are

10 competitive with regard to the quality and delivery of the

11 goods or services being purchased.

12 ‘‘(2) In carrying out paragraph (1), a contracting of13 ficer shall consider a responsive offer timely received from

14 an eligible small business offeror.

15 ‘‘(3) Nothing in paragraph (1) shall be construed as

16 precluding an award of a contract with a value not in ex17 cess of the simplified acquisition threshold under the au18 thority of section 8(a) of this Act, section 2323 of title

19 10, United States Code, or section 712 of the Business

20 Opportunity Development Reform Act of 1988 (Public

21 Law 100–656; 15 U.S.C. 644 note).’’.

22 SEC. 4013. FAST PAYMENT UNDER SIMPLIFIED ACQUISI23 TION PROCEDURES.

24 (a) PAYMENT PROCEDURES.—The simplified acquisi25 tion procedures described in section 29(a) of the Office
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1 of Federal Procurement Policy Act (as added by section

2 4011) shall provide for use of the payment terms described

3 in subsection (b), and for the disbursement of payment

4 through electronic fund transfer, whenever circumstances

5 permit.

6 (b) REQUIRED PAYMENT TERMS.—The payment

7 terms for a purchase made pursuant to simplified acquisi8 tion procedures shall require payment, in accordance with

9 the provisions of chapter 39 of title 31, United States

10 Code, within 15 days after the date of the receipt of a

11 proper invoice for products delivered or services per12 formed, if—

13 (1) in the case of a purchase of property, title

14 to the property will vest in the Government upon de15 livery of the property to the Government or to a

16 common carrier; and

17 (2) in the case of property or services for which

18 payment is due before the Government’s acceptance

19 of the property or services, the vendor provides com20 mercial or other appropriate warranties assuring

21 that the property or services purchased conform to

22 the requirements set forth in the Government’s pur23 chase offer.
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1 SEC. 4014. PROCUREMENT NOTICE.

2 (a) CONTINUATION OF EXISTING NOTICE THRESH3 OLDS.—Subsection (a) of section 18 of the Office of Fed4 eral Procurement Policy Act (41 U.S.C. 416) is amend5 ed—

6 (1) in paragraph (1), by striking out ‘‘the small

7 purchase threshold’’ each place it appears and in8 serting in lieu thereof ‘‘$25,000’’; and

9 (2) in paragraph (3)(B), by inserting after

10 ‘‘(B)’’ the following: ‘‘in the case of a contract or

11 order expected to exceed the simplified acquisition

12 threshold,’’.

13 (b) CONTENT OF NOTICE.—Subsection (b) of such

14 section is amended—

15 (1) by striking out ‘‘and’’ at the end of para16 graph (4);

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

18 paragraph (5) and inserting in lieu thereof a semi19 colon; and

20 (3) by adding at the end the following:

21 ‘‘(6) in the case of a contract in an amount es22 timated to exceed $25,000 but not to exceed the

23 simplified acquisition threshold—

24 ‘‘(A) a description of the procedures to be

25 used in awarding the contract; and
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1 ‘‘(B) a statement specifying the periods for

2 prospective offerors and the contracting officer

3 to take the necessary preaward and award ac4 tions.’’.

5 (c) NOTICE UNDER THE SMALL BUSINESS ACT.—

6 (1) CONTINUATION OF EXISTING NOTICE

7 THRESHOLDS.—Subsection (e) of section 8 of the

8 Small Business Act (15 U.S.C. 637) is amended—

9 (A) in paragraph (1), by striking out ‘‘the

10 small purchase threshold’’ each place it appears

11 and inserting in lieu thereof ‘‘$25,000’’; and

12 (B) in paragraph (3)(B), by inserting after

13 ‘‘(B)’’ the following: ‘‘in the case of a contract

14 or order estimated to exceed the simplified ac15 quisition threshold,’’.

16 (2) CONTENT OF NOTICE.—Subsection (f) of

17 such section is amended—

18 (A) by striking out ‘‘and’’ at the end of

19 paragraph (4);

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

21 of paragraph (5) and inserting in lieu thereof a

22 semicolon; and

23 (C) by adding at the end the following:
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1 ‘‘(6) in the case of a contract in an amount es2 timated to exceed the $25,000 but not to exceed the

3 simplified acquisition threshold—

4 ‘‘(A) a description of the procedures to be

5 used in awarding the contract; and

6 ‘‘(B) a statement specifying the periods for

7 prospective offerors and the contracting officer

8 to take the necessary preaward and award ac9 tions.’’.

10 SEC. 4015. ELECTRONIC COMMERCE FOR FEDERAL GOV11 ERNMENT PROCUREMENTS.

12 (a) DEVELOPMENT AND IMPLEMENTATION OF SYS13 TEM.—The Administrator for Federal Procurement Pol14 icy, in consultation with the heads of appropriate Federal

15 Government agencies having applicable technical and

16 functional expertise, may take appropriate steps to develop

17 and implement a Federal Governmentwide architecture or

18 design for electronic commerce that provides interoper19 ability among users.

20 (b) REQUIRED CAPABILITIES.—The requirements

21 analysis prepared to implement the architecture or design

22 of a system of electronic commerce referred to in sub23 section (a) shall have the following capabilities:

24 (1) The maximum practicable capability for

25 electronic exchange of such procurement information
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1 as solicitations, offers, contracts, purchase orders,

2 invoices, payments, and other contractual documents

3 between the private sector and the Federal Govern4 ment.

5 (2) Capabilities that increase the access of busi6 nesses, including small business concerns, socially

7 and economically disadvantaged small business con8 cerns, and businesses owned predominantly by

9 women, to Federal Government procurement oppor10 tunities.

11 (3) Easy access for potential Federal Govern12 ment contractors.

13 (4) Use of nationally and internationally recog14 nized data formats that broaden and ease electronic

15 interchange of data.

16 (5) Use of Federal Government systems and

17 networks and industry systems and networks.

18 (c) NOTICE AND SOLICITATION REGULATIONS.—In

19 connection with implementation of the architecture or de20 sign referred to in subsection (a), the Federal Acquisition

21 Regulatory Council shall ensure that the Federal Acquisi22 tion Regulation contains appropriate notice and solicita23 tion provisions applicable to acquisitions conducted

24 through such architecture or design. The provisions shall

25 specify the required form and content of notices of acquisi-
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1 tions and the minimum periods for notifications and solici2 tations. Each minimum period specified for a notification

3 or solicitation shall afford potential offerors a reasonable

4 opportunity to respond to the notification or solicitation,

5 as the case may be.

6 (d) LIMITATION OF PUBLICATION REQUIREMENT.—

7 The requirement in section 18(a) of the Office of Federal

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

9 8(e) of the Small Business Act (15 U.S.C. 637(e)) for

10 publishing notice of a solicitation in the Commerce Busi11 ness Daily shall not apply to acquisitions of a Federal

12 agency or a component of a Federal agency that are made

13 through electronic commerce and have a value not in ex14 cess of the simplified acquisition threshold if the Adminis15 trator for Federal Procurement Policy certifies that such

16 agency or component—

17 (1) has fully implemented the architecture or

18 design referred to in subsection (a); and

19 (2) has procedures in place—

20 (A) to provide notice to potential offerors

21 in accordance with the requirements of the Fed22 eral Acquisition Regulation prescribed pursuant

23 to subsection (c); and

24 (B) to ensure that small business concerns

25 are afforded an opportunity to respond to a so-
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1 licitation of contract offers within the period

2 specified in the solicitation.

3 (e) DEFINITION.—In this section, the term ‘‘sim4 plified acquisition threshold’’ has the meaning given that

5 term is section 4(11) of the Office of Federal Procurement

6 Policy Act (41 U.S.C. 403(11)).

7 PART III—APPLICABILITY OF LAWS TO ACQUISI8 TIONS NOT IN EXCESS OF SIMPLIFIED AC9 QUISITION THRESHOLD

10 SEC. 4021. FUTURE ENACTED PROCUREMENT LAWS.

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 ‘‘APPLICABILITY OF CERTAIN LAWS TO CONTRACTS NOT

16 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 1994 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 SEC. 4022. ARMED SERVICES ACQUISITIONS.

7 (a) REQUIREMENT FOR CONTRACT CLAUSE REGARD8 ING CONTINGENT FEES.—Section 2306(b) of title 10,

9 United States Code, is amended by adding at the end the

10 following: ‘‘This subsection does not apply to a contract

11 that is not in excess of the simplified acquisition thresh12 old.’’.

13 (b) PROHIBITION ON LIMITING SUBCONTRACTOR DI14 RECT SALES TO THE UNITED STATES.—Section 2402 of

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

16 end the following new subsection:

17 ‘‘(c) This section does not apply to a contract that

18 is not in excess of the simplified acquisition threshold (as

19 defined in section 4(11) of the Office of Federal Procure20 ment Policy Act (41 U.S.C. 403(11))).’’.

21 (c) AUTHORITY TO EXAMINE BOOKS AND RECORDS

22 OF CONTRACTORS.—Section 2313 of title 10, United

23 States Code, as amended by section 2201, is further

24 amended by adding at the end of subsection (f) the follow25 ing:
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1 ‘‘(2) A contract that is not in excess of the sim2 plified acquisition threshold.’’.

3 (d) REQUIREMENT TO IDENTIFY SUPPLIERS AND

4 SOURCES OF SUPPLIES.—Section 2384(b) of title 10,

5 United States Code, is amended by adding at the end the

6 following new paragraph:

7 ‘‘(3) The regulations prescribed pursuant to para8 graph (1) do not apply to a contract that does not exceed

9 the simplified acquisition threshold (as defined in section

10 4(11) of the Office of Federal Procurement Policy Act (41

11 U.S.C. 403(11))).’’.

12 (e) PROHIBITION AGAINST DOING BUSINESS WITH

13 CERTAIN OFFERORS OR CONTRACTORS.—Section 2393(d)

14 of title 10, United States Code, is amended in the second

15 sentence by striking out ‘‘above’’ and all that follows and

16 inserting in lieu thereof ‘‘in excess of the simplified acqui17 sition threshold (as defined in section 4(11) of the Office

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

19 403(11))).’’.

20 (f) PROHIBITION ON PERSONS CONVICTED OF DE21 FENSE-CONTRACT RELATED FELONIES.—Section

22 2408(a) of title 10, United States Code, is amended by

23 adding at the end the following new paragraph:

24 ‘‘(4) The prohibition in paragraph (1) does not apply

25 with respect to the following:
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1 ‘‘(A) A contract referred to in subparagraph

2 (A), (B), (C), or (D) of such paragraph that is not

3 in excess of the simplified acquisition threshold (as

4 defined in section 4(11) of the Office of Federal

5 Procurement Policy Act (41 U.S.C. 403 (11))).

6 ‘‘(B) A subcontract referred to in such subpara7 graph that is under a contract described in subpara8 graph (A).’’.

9 SEC. 4023. CIVILIAN AGENCY ACQUISITIONS.

10 (a) REQUIREMENT FOR CONTRACT CLAUSE REGARD11 ING CONTINGENT FEES.—Section 304(a) of the Federal

12 Property and Administrative Services Act of 1949 (41

13 U.S.C. 254(a)) is amended by adding at the end the fol14 lowing: ‘‘The preceding sentence does not apply to a con15 tract that is not in excess of the simplified acquisition

16 threshold.’’.

17 (b) PROHIBITION ON LIMITING SUBCONTRACTOR DI18 RECT SALES TO THE UNITED STATES.—Section 303G of

19 the Federal Property and Administrative Services Act of

20 1949 (41 U.S.C. 253g) is amended by adding at the end

21 the following new subsection:

22 ‘‘(c) This section does not apply to a contract that

23 is not in excess of the simplified acquisition threshold.’’.

24 (c) AUTHORITY TO EXAMINE BOOKS AND RECORDS

25 OF CONTRACTORS.—Section 304B of the Federal Prop-
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1 erty and Administrative Services Act of 1949, as added

2 by section 2251(a), is amended by adding at the end of

3 subsection (f) the following:

4 ‘‘(2) A contract that is not in excess of the sim5 plified acquisition threshold.’’.

6 SEC. 4024. ACQUISITIONS GENERALLY.

7 (a) LIMITATION ON USE OF FUNDS TO INFLUENCE

8 CERTAIN FEDERAL ACTIONS.—Section 1352(e)(2)(B) of

9 title 31, United States Code, is amended by striking out

10 ‘‘$100,000’’ and inserting in lieu thereof ‘‘the simplified

11 acquisition threshold (as defined in section 4(11) of the

12 Office of Federal Procurement Policy Act (41 U.S.C.

13 403(11)))’’.

14 (b) REQUIREMENT FOR CONTRACT CLAUSE RELAT15 ING TO KICKBACKS.—Section 7 of the Anti-Kickback Act

16 of 1986 (41 U.S.C. 57) is amended by adding at the end

17 the following new subsection:

18 ‘‘(d) Subsections (a) and (b) do not apply to a prime

19 contract that is not in excess of the simplified acquisition

20 threshold (as defined in section 4(11) of the Office of Fed21 eral Procurement Policy Act (41 U.S.C. 403(11))).’’.

22 (c) MILLER ACT.—

23 (1) IN GENERAL.—

24 (A) CONTRACTS NOT EXCEEDING SIM25 PLIFIED ACQUISITION THRESHOLD.—The Act
218

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1 of August 24, 1935 (40 U.S.C. 270a et seq.),

2 commonly referred to as the ‘‘Miller Act’’, is

3 amended by adding at the end the following

4 new section:

5 ‘‘SEC. 5. This Act does not apply to a contract in

6 an amount that is not in excess of the simplified acquisi7 tion threshold (as defined in section 4(11) of the Office

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

9 403(11))).’’.

10 (B) CONFORMING AMENDMENT.—Sub11 section (a) of the first section of such Act is

12 amended by striking out ‘‘, exceeding $25,000

13 in amount,’’.

14 (2) ALTERNATIVE PAYMENT PROTECTIONS.—

15 (A) PROTECTIONS TO BE SPECIFIED IN

16 THE FAR.—The Federal Acquisition Regulation

17 shall provide alternatives to payment bonds as

18 payment protections for suppliers of labor and

19 materials under contracts referred to in sub20 paragraph (C).

21 (B) USE OF AUTHORIZED PROTECTIONS.—

22 The contracting officer for a contract shall—

23 (i) select, from among the payment

24 protections provided for in the Federal Ac25 quisition Regulation pursuant to subpara-
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1 graph (A), one or more payment protec2 tions which the offeror awarded the con3 tract is to submit to the Federal Govern4 ment for the protection of suppliers of

5 labor and materials for such contract; and

6 (ii) specify in the solicitation of offers

7 for such contract the payment protection

8 or protections so selected.

9 (C) COVERED CONTRACTS.—

10 (i) APPLICABILITY.—The regulations

11 required under subparagraph (A) and the

12 requirements of subparagraph (B) apply

13 with respect to contracts referred to in

14 subsection (a) of the first section of the

15 Miller Act that are in excess of $25,000

16 but not in excess of the simplified acquisi17 tion threshold (as defined in section 4(11)

18 of the Office of Federal Procurement Pol19 icy Act (41 U.S.C. 403(11))).

20 (ii) MILLER ACT REFERENCE.—The

21 Miller Act referred to in subparagraph (A)

22 is the Act of August 24, 1935 (40 U.S.C.

23 270a et seq.), commonly referred to as the

24 ‘‘Miller Act’’.
220

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1 (d) CONTRACT WORK HOURS AND SAFETY STAND2 ARDS ACT.—

3 (1) IN GENERAL.—Section 103 of the Contract

4 Work Hours and Safety Standards Act (40 U.S.C.

5 329) is amended by adding at the end the following

6 new subsection:

7 ‘‘(c) This title does not apply to a contract in an

8 amount that is not in excess of the simplified acquisition

9 threshold (as defined in section 4(11) of the Office of Fed10 eral Procurement Policy Act (41 U.S.C. 403(11))).’’.

11 (2) CONFORMING AMENDMENT.—Section

12 107(a) of such Act (40 U.S.C. 333(a)) is amended

13 by inserting after ‘‘It shall be a condition of each

14 contract’’ the following: ‘‘(other than a contract re15 ferred to in section 103(c))’’.

16 (e) DRUG-FREE WORKPLACE ACT OF 1988.—Section

17 5152(a)(1) of the Drug-Free Workplace Act of 1988 (sub18 title D of title V of the Anti-Drug Abuse Act of 1988;

19 Public Law 100–690; 41 U.S.C. 701(a)(1)) is amended

20 by striking out ‘‘of $25,000 or more from any Federal

21 agency’’ and inserting in lieu thereof ‘‘in excess of the sim22 plified acquisition threshold (as defined in section 4(11)

23 of such Act (41 U.S.C. 403(11))) by any Federal agency’’.

24 (f) CERTAIN PROCUREMENT INTEGRITY REQUIRE25 MENTS.—
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1 (1) CERTIFICATION REQUIREMENT.—Sub2 section (e)(7)(A) of section 27 of the Office of Fed3 eral Procurement Policy Act (41 U.S.C. 423) is

4 amended by striking out ‘‘$100,000’’ and inserting

5 in lieu thereof ‘‘the simplified acquisition threshold’’.

6 (2) CONTRACT CLAUSE REQUIREMENT.—Sub7 section (g)(1) of such section is amended by insert8 ing after ‘‘awarded by a Federal agency’’ the follow9 ing: ‘‘(other than a contract in an amount that is

10 not in excess of the simplified acquisition thresh11 old)’’.

12 (g) SOLID WASTE DISPOSAL ACT.—Section 6002(a)

13 of the Solid Waste Disposal Act (42 U.S.C. 6962(a)) is

14 amended by striking out all that follows ‘‘with respect to

15 any’’ and inserting in lieu thereof ‘‘contract in excess of

16 the simplified acquisition threshold (as defined in section

17 4(11) of the Office of Federal Procurement Policy Act (41

18 U.S.C. 403(11))).’’.

19 PART IV—CONFORMING AMENDMENTS

20 SEC. 4071. ARMED SERVICES ACQUISITIONS.

21 (a) SIMPLIFIED ACQUISITION PROCEDURES.—Sec22 tion 2304(g) of title 10, United States Code, is amended—

23 (1) in paragraph (1), by striking out ‘‘small

24 purchases of property and services’’ and inserting in
222

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1 lieu thereof ‘‘purchases of property and services not

2 in excess of the simplified acquisition threshold’’;

3 (2) by striking out paragraph (2);

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

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

6 (4) in paragraph (2), as so redesignated—

7 (A) by striking out ‘‘small purchase

8 threshold’’ and inserting in lieu thereof ‘‘sim9 plified acquisition threshold’’; and

10 (B) by striking out ‘‘small purchase proce11 dures’’ and inserting in lieu thereof ‘‘simplified

12 procedures’’; and

13 (5) in paragraph (3), as redesignated by para14 graph (3), by striking out ‘‘small purchase proce15 dures’’ and inserting in lieu thereof ‘‘the simplified

16 procedures’’.

17 (b) SOLICITATION CONTENT REQUIREMENT.—Sec18 tion 2305(a)(2) of title 10, United States Code, is amend19 ed by striking out ‘‘small purchases)’’ in the matter above

20 subparagraph (A) and inserting in lieu thereof ‘‘purchases

21 not in excess of the simplified acquisition threshold)’’.

22 (c) COST TYPE CONTRACTS.—Section 2306(e)(2)(A)

23 of title 10, United States Code, is amended by striking

24 out ‘‘small purchase threshold’’ and inserting in lieu there25 of ‘‘simplified acquisition threshold’’.
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1 SEC. 4072. CIVILIAN AGENCY ACQUISITIONS.

2 (a) SIMPLIFIED ACQUISITION PROCEDURES.—

3 (1) PROPERTY AND SERVICES GENERALLY.—

4 Section 303(g) of the Federal Property and Admin5 istrative Services Act of 1949 (41 U.S.C. 253(g)) is

6 amended—

7 (A) in paragraph (1), by striking out

8 ‘‘small purchases of property and services’’ and

9 inserting in lieu thereof ‘‘purchases of property

10 and services not in excess of the simplified ac11 quisition threshold’’;

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

13 (5);

14 (C) by redesignating paragraphs (3) and

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

16 (D) in paragraph (2), as so redesignated—

17 (i) by striking out ‘‘small purchase

18 threshold’’ and inserting in lieu thereof

19 ‘‘simplified acquisition threshold’’; and

20 (ii) by striking out ‘‘small purchase

21 procedures’’ and inserting in lieu thereof

22 ‘‘simplified procedures’’; and

23 (E) in paragraph (3), as redesignated by

24 subparagraph (C), by striking out ‘‘small pur25 chase procedures’’ and inserting in lieu thereof

26 ‘‘the simplified procedures’’.
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1 (2) LEASEHOLDS.—Section 210 of the Federal

2 Property and Administrative Services Act of 1949

3 (40 U.S.C. 490) is amended by adding at the end

4 the following new subsection:

5 ‘‘(k)(1) Regulations prescribed by the Administrator

6 shall provide special simplified procedures for acquisitions

7 of leasehold interests in real property at rental rates that

8 do not exceed the simplified acquisition threshold.

9 ‘‘(2) For purposes of paragraph (1), the rental rate

10 or rates under a multiyear lease do not exceed the sim11 plified acquisition threshold if the average annual amount

12 of the rent payable for the period of the lease does not

13 exceed the simplified acquisition threshold.

14 ‘‘(3) In this subsection, the term ‘simplified acquisi15 tion threshold’ has the meaning given that term in section

16 4(11) of the Office of Federal Procurement Policy Act (41

17 U.S.C. 403(11)).’’.

18 (b) SOLICITATION CONTENT REQUIREMENT.—Sec19 tion 303A(b) of the Federal Property and Administrative

20 Services Act of 1949 (41 U.S.C. 253a(b)) is amended by

21 striking out ‘‘small purchases)’’ in the matter above para22 graph (1) and inserting in lieu thereof ‘‘purchases not in

23 excess of the simplified acquisition threshold)’’.

24 (c) COST TYPE CONTRACTS.—Section 304(b) of the

25 Federal Property and Administrative Services Act of 1949
225

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1 (41 U.S.C. 254(b)), as amended by section 1071, is fur2 ther amended in the second sentence by striking out ‘‘ei3 ther $25,000’’ and inserting in lieu thereof ‘‘either the

4 simplified acquisition threshold’’.

5 SEC. 4073. OFFICE OF FEDERAL PROCUREMENT POLICY

6 ACT.

7 Section 19(a) of the Office of Federal Procurement

8 Policy Act (41 U.S.C. 417(a)) is amended by striking out

9 ‘‘procurements, other than small purchases,’’ and insert10 ing in lieu thereof ‘‘procurements in excess of the sim11 plified acquisition threshold’’.

12 SEC. 4074. SMALL BUSINESS ACT.

13 (a) DEFINITION.—Section 3(m) of the Small Busi14 ness Act (15 U.S.C. 632(m)) is amended by striking out

15 ‘‘ ‘small purchase threshold’ ’’ and inserting in lieu thereof

16 ‘‘ ‘simplified acquisition threshold’ ’’.

17 (b) USE OF SIMPLIFIED ACQUISITION THRESHOLD

18 TERM.—Section 8(d)(2)(A) of the Small Business Act (15

19 U.S.C. 637(d)(2)(A)) is amended by striking out ‘‘small

20 purchase threshold’’ and inserting in lieu thereof ‘‘sim21 plified acquisition threshold’’.

22 PART V—REVISION OF REGULATIONS

23 SEC. 4081. REVISION REQUIRED.

24 (a) FEDERAL ACQUISITION REGULATION.—The Fed25 eral Acquisition Regulatory Council established by section
226

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1 25(a) of the Office of Federal Procurement Policy Act (41

2 U.S.C. 421(a)) shall review the Federal Acquisition Regu3 lation to identify regulations that are applicable to acquisi4 tions in excess of a specified amount that is less than

5 $100,000. The Council shall amend the regulations so

6 identified as necessary to provide that such regulations do

7 not apply to acquisitions that are not in excess of the sim8 plified acquisition threshold. The preceding sentence does

9 not apply in the case of a regulation for which such an

10 amendment would not be in the national interest, as deter11 mined by the Council.

12 (b) SUPPLEMENTAL REGULATIONS.—The head of

13 each Federal agency that has issued regulations, policies,

14 or procedures referred to in section 25(c)(2) of the Office

15 of Federal Procurement Policy Act (41 U.S.C. 421(c)(2))

16 shall identify any such regulations, policies, or procedures

17 that are applicable to acquisitions in excess of a specified

18 amount that is less than $100,000. The agency head shall

19 amend the regulations so identified as necessary to provide

20 that such regulations, policies, and procedures do not

21 apply to acquisitions that are not in excess of the sim22 plified acquisition threshold. The preceding sentence does

23 not apply in the case of a regulation, policy, or procedure

24 for which such an amendment would not be in the national

25 interest, as determined by the agency head.
227

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1 (c) COMPLETION OF ACTIONS.—All actions under

2 this section shall be completed not later than 180 days

3 after the date of the enactment of this Act.

4 (d) DEFINITIONS.—In this section:

5 (1) The term ‘‘simplified acquisition threshold’’

6 has the meaning given such term in section 4(11) of

7 the Office of Federal Procurement Policy Act (41

8 U.S.C. 403(11)), as amended by section 4001.

9 (2) The term ‘‘Federal agency’’ has the mean10 ing given such term in section 3(b) of the Federal

11 Property and Administrative Services Act of 1949

12 (41 U.S.C. 472(b)).

13 Subtitle B—Socioeconomic and

14 Small Business Laws

15 SEC. 4101. ARMED SERVICES ACQUISITIONS.

16 (a) INAPPLICABILITY OF CERTAIN LABOR LAWS TO

17 CONSTRUCTION OF NAVAL VESSELS.—Section 7299 of

18 title 10, United States Code, is amended to read as fol19 lows: ‘‘No contract for the construction, alteration, fur20 nishing, or equipping of a naval vessel shall be subject to

21 the Act of March 3, 1931 (40 U.S.C. 276a(a)), commonly

22 referred to as the ‘Davis-Bacon Act’, or to the Service

23 Contract Act of 1965 (41 U.S.C. 351 et seq.), unless the

24 President determines that such requirement is in the in25 terest of national defense.’’.
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1 (b) CLERICAL AMENDMENTS.—

2 (1) SECTION HEADING.—The heading of such

3 section is amended to read as follows:

4 ‘‘§ 7299. Contracts: applicability of certain labor

5 laws’’.

6 (2) TABLE OF SECTIONS.—The item relating to

7 such section in the table of sections at the beginning

8 of chapter 633 of title 10, United States Code, is

9 amended to read as follows:

‘‘7299. Contracts: applicability of certain labor laws.’’.

10 SEC. 4102. ACQUISITIONS GENERALLY.

11 (a) INAPPLICABILITY OF CERTAIN LABOR LAWS TO

12 CONSTRUCTION OF VESSELS.—No contract for the con13 struction, alteration, furnishing, or equipping of a vessel

14 shall be subject to the Act of March 3, 1931 (40 U.S.C.

15 276a(a)), commonly referred to as the ‘Davis-Bacon Act’,

16 or to the Service Contract Act of 1965 (41 U.S.C. 351

17 et seq.), unless the President determines that such re18 quirement is in the interest of the United States.

19 (b) REPEAL OF EXECUTED REPORTING REQUIRE20 MENT.—Section 306 of the Trade Agreements Act of 1979

21 (19 U.S.C. 2516) is repealed.

22 (c) WALSH-HEALEY ACT.—

23 (1) REPEAL OTHER THAN FOR CERTAIN DEFI24 NITIONAL PURPOSES.—The Act of June 30, 1936
229

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1 (41 U.S.C. 35 et seq.), commonly referred to as the

2 ‘‘Walsh-Healey Act’’, is amended to read as follows:

3 ‘‘SECTION 1. (a) The Secretary of Labor may pre4 scribe in regulations the standards for determining wheth5 er a contractor is a manufacturer of or a regular dealer

6 in materials, supplies, articles, or equipment to be manu7 factured or used in the performance of a contract entered

8 into by any executive department, independent establish9 ment, or other agency or instrumentality of the United

10 States, or by the District of Columbia, or by any corpora11 tion all the stock of which is beneficially owned by the

12 United States, for the manufacture or furnishing of mate13 rials, supplies, articles, and equipment.

14 ‘‘(b) Any interested person shall have the right of ju15 dicial review of any legal question regarding the interpre16 tation of the terms ‘regular dealer’ and ‘manufacturer’,

17 as defined pursuant to subsection (a).’’

18 (2) CONFORMING AMENDMENT.—Section

19 2304(h) of title 10, United States Code, is amended

20 to read as follows:

21 ‘‘(h) For the purposes of the Act entitled ‘An Act

22 relating to the rate of wages for laborers and mechanics

23 employed on public buildings of the United States and the

24 District of Columbia by contractors and subcontractors,

25 and for other purposes’, approved March 3, 1931 (com-
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1 monly referred to as the ‘Davis-Bacon Act’) (40 U.S.C.

2 276a et seq.), purchases or contracts awarded after using

3 procedures other than sealed-bid procedures shall be treat4 ed as if they were made with sealed-bid procedures.’’.

5 (d) REPEAL OF REDUNDANT REQUIREMENT RE6 GARDING APPLICABILITY OF THE DAVIS-BACON ACT AND

7 THE WALSH-HEALEY ACT.—Section 308 of the Federal

8 Property and Administrative Services Act of 1949 (41

9 U.S.C. 258) is repealed.

10 SEC. 4103. ACQUISITIONS FROM SMALL BUSINESSES.

11 (a) SET-ASIDE PRIORITY.—Section 15 of the Small

12 Business Act (15 U.S.C. 644) is amended by striking out

13 subsections (e) and (f).

14 (b) CERTIFICATE OF COMPETENCE.—Section 804 of

15 Public Law 103–484 (106 Stat. 2447; 10 U.S.C. 2305

16 note) is repealed.

17 SEC. 4104. CONTRACTING PROGRAM FOR CERTAIN SMALL

18 BUSINESS CONCERNS.

19 (a) PROCUREMENT PROCEDURES AUTHORIZED.—

20 Section 8 of the Small Business Act (15 U.S.C. 637) is

21 amended by inserting after subsection (b) the following

22 new subsection:

23 ‘‘(c)(1) To facilitate the attainment of a goal for the

24 participation of small business concerns owned and con25 trolled by socially and economically disadvantaged individ-
231

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1 uals that is established for a Federal agency pursuant to

2 section 15(g)(1), the head of the agency may enter into

3 contracts using—

4 ‘‘(A) less than full and open competition by re5 stricting the competition for such awards to small

6 business concerns owned and controlled by socially

7 and economically disadvantaged individuals de8 scribed in subsection (d)(3)(C) of this section; and

9 ‘‘(B) a price evaluation preference not in excess

10 of 10 percent when evaluating an offer received from

11 such a small business concern as the result of an un12 restricted solicitation.

13 ‘‘(2) Paragraph (1) does not apply to the Department

14 of Defense.’’.

15 (b) IMPLEMENTATION THROUGH THE FEDERAL AC16 QUISITION REGULATION.—

17 (1) IN GENERAL.—The Federal Acquisition

18 Regulation shall be amended to provide for uniform

19 implementation of the authority provided in section

20 8(c) of the Small Business Act, as added by sub21 section (a).

22 (2) MATTERS TO BE ADDRESSED.—The provi23 sions of the Federal Acquisition Regulation pre24 scribed pursuant to paragraph (1) shall include—
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1 (A) conditions for the use of advance pay2 ments;

3 (B) provisions for contract payment terms

4 that provide for—

5 (i) accelerated payment for work per6 formed during the period for contract per7 formance; and

8 (ii) full payment for work performed;

9 (C) guidance on how contracting officers

10 may use, in solicitations for various classes of

11 products or services, a price evaluation pref12 erence pursuant to section 8(c)(1)(B) of the

13 Small Business Act, as added by subsection (a),

14 to provide a reasonable advantage to small busi15 ness concerns owned and controlled by socially

16 and economically disadvantaged individuals

17 without effectively eliminating any participation

18 of other small business concerns; and

19 (D)(i) procedures for a person to request

20 the head of Federal agency to determine wheth21 er the use of competitions restricted to small

22 business concerns owned and controlled by so23 cially and economically disadvantaged individ24 uals at a contracting activity of such agency

25 has caused a particular industry category to
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1 bear a disproportionate share of the contracts

2 awarded to attain the goal established for that

3 contracting activity; and

4 (ii) guidance for limiting the use of such

5 restricted competitions in the case of any con6 tracting activity and class of contracts deter7 mined in accordance with such procedures to

8 have caused a particular industry category to

9 bear a disproportionate share of the contracts

10 awarded to attain the goal established for that

11 contracting activity.

12 (c) TERMINATION.—Section 8(c) of the Small Busi13 ness Act, as added by subsection (a), shall cease to be

14 effective at the end of September 30, 1999.

15 Subtitle C—Miscellaneous

16 Acquisition Laws

17 SEC. 4151. PROHIBITION ON USE OF FUNDS FOR DOCU18 MENTING ECONOMIC OR EMPLOYMENT IM19 PACT OF CERTAIN ACQUISITION PROGRAMS.

20 (a) REVISION AND CODIFICATION.—

21 (1) IN GENERAL.—Subchapter I of chapter 134

22 of title 10, United States Code, is amended by add23 ing at the end the following new section:
234

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1 ‘‘§ 2247. Prohibition on use of funds for documenting

2 economic or employment impact of cer3 tain acquisition programs

4 ‘‘No funds appropriated by the Congress may be obli5 gated or expended to assist any contractor of the Depart6 ment of Defense in preparing any material, report, lists,

7 or analysis with respect to the actual or projected eco8 nomic or employment impact in a particular State or con9 gressional district of an acquisition program for which all

10 research, development, testing, and evaluation has not

11 been completed.’’.

12 (2) CLERICAL AMENDMENT.—The table of sec13 tions at the beginning of such subchapter is amend14 ed by adding at the end the following new item:

‘‘2247. Prohibition on use of funds for documenting economic or employment

impact of certain acquisition programs.’’.

15 (b) REPEAL OF SUPERSEDED LAW.—Section 9048 of

16 Public Law 102–396 (106 Stat. 1913) is repealed.

17 SEC. 4152. RESTRICTION ON USE OF NONCOMPETITIVE

18 PROCEDURES FOR PROCUREMENT FROM A

19 PARTICULAR SOURCE.

20 (a) ARMED SERVICES ACQUISITIONS.—Section 2304

21 of title 10, United States Code, as amended by section

22 1005(b), is further amended—

23 (1) in subsection (c)(5), by inserting ‘‘subject to

24 subsection (j),’’ after ‘‘(5)’’; and
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1 (2) by adding at the end the following new sub2 section:

3 ‘‘(j)(1) It is the policy of Congress that no legislation

4 should be enacted that requires a procurement to be made

5 from a specified non-Federal Government source.

6 ‘‘(2) A provision of law may not be construed as re7 quiring a procurement to be made from a specified non8 Federal Government source unless that provision of law—

9 ‘‘(A) specifically refers to this subsection;

10 ‘‘(B) specifically identifies the particular non11 Federal Government source involved; and

12 ‘‘(C) specifically states that the procurement

13 from that source is required by such provision of law

14 in contravention of the policy set forth in paragraph

15 (1).’’.

16 (b) CIVILIAN AGENCY ACQUISITIONS.—Section 303

17 of the Federal Property and Administrative Services Act

18 of 1949 (41 U.S.C. 253) is amended—

19 (1) in subsection (c)(5), by inserting ‘‘subject to

20 subsection (h),’’ after ‘‘(5)’’; and

21 (2) by adding at the end the following new sub22 section:

23 ‘‘(h)(1) It is the policy of Congress that no legislation

24 should be enacted that requires a procurement to be made

25 from a specified non-Federal Government source.
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1 ‘‘(2) A provision of law may not be construed as re2 quiring a procurement to be made from a specified non3 Federal Government source unless that provision of law—

4 ‘‘(A) specifically refers to this subsection;

5 ‘‘(B) specifically identifies the particular non6 Federal Government source involved; and

7 ‘‘(C) specifically states that the procurement

8 from that source is required by such provision of law

9 in contravention of the policy set forth in paragraph

10 (1).’’.

11 TITLE V—ACQUISITION

12 MANAGEMENT

13 Subtitle A—Armed Services

14 Acquisitions

15 SEC. 5001. PERFORMANCE BASED MANAGEMENT.

16 (a) POLICY AND GOALS FOR PERFORMANCE BASED

17 MANAGEMENT OF PROGRAMS.—

18 (1) IN GENERAL.—Chapter 131 of title 10,

19 United States Code, is amended by adding at the

20 end the following new section:

21 ‘‘§ 2219. Performance based management: acquisition

22 programs

23 ‘‘(a) CONGRESSIONAL POLICY.—It is the policy of

24 Congress that—
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1 ‘‘(1) the Department of Defense should achieve,

2 on average, 90 percent of the cost and schedule

3 goals established for the research and development

4 programs and acquisition programs of the Depart5 ment of Defense without reducing the performance

6 or capabilities of the items being acquired; and

7 ‘‘(2) the average period necessary for converting

8 an emerging technology into initial operational capa9 bility for the Department of Defense should not ex10 ceed 8 years.

11 ‘‘(b) ESTABLISHMENT OF GOALS.—(1) The Sec12 retary of Defense shall approve or define the cost, per13 formance, and schedule goals for major defense acquisition

14 programs of the Department of Defense.

15 ‘‘(2) The Comptroller of the Department of Defense

16 shall evaluate the cost goals proposed for each major de17 fense acquisition program of the Department.

18 ‘‘(c) IDENTIFICATION OF NONCOMPLIANT PRO19 GRAMS.—Whenever it is necessary to do so in order to

20 implement the policy set out in subsection (a), the Sec21 retary of Defense shall—

22 ‘‘(1) identify and consider whether there is a

23 continuing need for programs that are significantly

24 behind schedule, over budget, or not in compliance
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1 with performance or capability requirements taking

2 into consideration—

3 ‘‘(A) the needs of the Department known

4 as of the time of consideration;

5 ‘‘(B) the state of the technology or tech6 nologies relevant to the programs and to the

7 needs of the Department;

8 ‘‘(C) the estimated costs and projected

9 schedules necessary for the completion of such

10 programs; and

11 ‘‘(D) other pertinent information; and

12 ‘‘(2) identify existing and potential research

13 and development programs and acquisition programs

14 that are suitable alternatives for programs consid15 ered pursuant to paragraph (1).

16 ‘‘(d) ANNUAL REPORTING REQUIREMENT.—The Sec17 retary of Defense shall include in the annual report sub18 mitted to Congress pursuant to section 113(c) of this title

19 an assessment of the progress made in implementing the

20 policy stated in subsection (a). The Secretary shall use

21 data from existing management systems in making the as22 sessment.’’.

23 (2) CLERICAL AMENDMENT.—The table of sec24 tions at the beginning of such chapter is amended

25 by adding at the end the following new item:

‘‘2219. Performance based management: acquisition programs.’’.
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1 (b) ENHANCED SYSTEM OF PERFORMANCE INCEN2 TIVES.—Within one year after the date of the enactment

3 of this Act, the Secretary of Defense shall review the in4 centives and personnel actions available to the Secretary

5 for encouraging excellence in the defense acquisition

6 workforce and provide an enhanced system of incentives

7 for the encouragement of excellence in such workforce.

8 The enhanced system of incentives shall, to the maximum

9 extent consistent with applicable law—

10 (1) relate pay to performance (including the ex11 tent to which the performance of personnel in such

12 workforce contributes to achieving the cost goals,

13 schedule goals, and performance goals established

14 for acquisition programs of the department pursuant

15 to section 2219(b) of title 10, as added by sub16 section (a)); and

17 (2) provide for consideration, in personnel eval18 uations and promotion decisions, of the extent to

19 which the performance of personnel in such

20 workforce contributes to achieving the cost goals,

21 schedule goals, and performance goals established

22 for acquisition programs of the department pursuant

23 to section 2219(b) of title 10, United States Code,

24 as added by subsection (a).
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1 (c) RECOMMENDED LEGISLATION.—Not later than

2 one year after the date of the enactment of this Act, the

3 Secretary of Defense shall submit to Congress any rec4 ommended legislation that the Secretary considers nec5 essary to carry out section 2219 of title 10, United States

6 Code, as added by subsection (a), and otherwise to facili7 tate and enhance management of Department of Defense

8 acquisition programs and the defense acquisition

9 workforce on the basis of performance.

10 SEC. 5002. RESULTS ORIENTED ACQUISITION PROGRAM

11 CYCLE.

12 The Secretary of Defense shall define in regulations

13 a simplified acquisition program cycle that is results-ori14 ented. The Secretary shall consider including in the regu15 lations provisions for the following:

16 (1) Program phases as follows:

17 (A) An integrated decision team meeting

18 which—

19 (i) may be requested by a potential

20 user of the system or component to be ac21 quired, the head of a laboratory, or a pro22 gram office on such bases as the emer23 gence of a new military requirement, cost

24 savings opportunity, or new technology op25 portunity;
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1 (ii) is conducted by an acquisition

2 program executive officer; and

3 (iii) is usually completed within 1 to 3

4 months.

5 (B) A prototype development and testing

6 phase which—

7 (i) includes operational tests and con8 cerns relating to manufacturing operations

9 and life cycle support;

10 (ii) is usually completed within 6 to

11 36 months; and

12 (iii) produces sufficient numbers of

13 prototypes to assess operational utility.

14 (C) Product integration, development, and

15 testing which—

16 (i) includes full-scale development,

17 operational testing, and integration of

18 components; and

19 (ii) is usually completed within 1 to 5

20 years.

21 (D) Production, integration into existing

22 systems, or production and integration into ex23 isting systems.
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1 (2) An acquisition program approval process for

2 major program decisions which consists of the fol3 lowing:

4 (A) One major decision point—

5 (i) which occurs for an acquisition

6 program before the program proceeds into

7 product integration and development; and

8 (ii) at which the Under Secretary of

9 Defense for Acquisition and Technology, in

10 consultation with the Vice Chairman of the

11 Joint Chiefs of Staff reviews the program,

12 determines whether the program should

13 continue to be carried out beyond product

14 integration and development, and decides

15 whether to commit to further development,

16 to require further prototyping, or to termi17 nate the program.

18 (B) Consideration of the potential benefits,

19 affordability, needs, and risks of an acquisition

20 program in the review of the acquisition pro21 gram.

22 SEC. 5003. DEFENSE ACQUISITION PILOT PROGRAM DES23 IGNATIONS.

24 (a) PROGRAMS AND WAIVERS.—The National De25 fense Authorization Act for Fiscal Year 1994 (Public Law
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1 103–160) is amended by inserting the following new sec2 tion at the end of subtitle D of title VIII:

3 ‘‘SEC. 840. DEFENSE ACQUISITION PILOT PROGRAM DES4 IGNATIONS.

5 ‘‘(a) ELIGIBLE PROGRAMS.—The Secretary of De6 fense is authorized to designate the following defense ac7 quisition programs for participation in the defense acquisi8 tion pilot program authorized by section 809 of the Na9 tional Defense Authorization Act for Fiscal Year 1991 (10

10 U.S.C. 2430 note):

11 ‘‘(1) Defense Personnel Support Center medi12 cal, clothing and textile, and subsistence programs

13 with respect to the following:

14 ‘‘(A) All contracts for processed fruits and

15 vegetables and frozen seafood items for both

16 depot stock and direct vendor delivery.

17 ‘‘(B) All contracts in the subsistence prime

18 vendor program for grocery items.

19 ‘‘(C) All contracts in the Mail Order Phar20 macy Program, the prime vendor programs for

21 pharmaceuticals and for medical surgical items

22 for delivery to military hospitals.

23 ‘‘(D) All contracts in the medical electronic

24 commerce program for acquisition for depot

25 stock and direct vendor delivery.
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1 ‘‘(E) All contracts for the following items:

2 dress coats (small lots), dress coats, duffel

3 bags, Navy work clothing, general purpose

4 tents, suitcases, gloves for electrical workers,

5 boot flyers, socks, drawers, undershirts, and

6 items offered under the Broad Agency An7 nouncements for Clothing and Textiles Ad8 vanced Business Practices Demonstration Pro9 gram.

10 ‘‘(2) The Fire Support Combined Arms Tactical

11 Trainer program with respect to all contracts di12 rectly related to the procurement of a training sys13 tem (including related hardware, software, and sub14 systems) to perform collective training of field artil15 lery gunnery team components with development of

16 software as required to generate the training exer17 cises and component interfaces.

18 ‘‘(3) The Joint Direct Attack Munition pro19 gram (JDAM I) with respect to all contracts directly

20 related to the development and procurement of a

21 strap-on guidance kit, using an inertially guided,

22 Global Positioning System updated guidance kit for

23 inventory 1,000 and 2,000 pound bombs.

24 ‘‘(4) The Joint Primary Aircraft Training Sys25 tem (JPATS) with respect to all contracts directly
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1 related to the acquisition of a new primary trainer

2 aircraft to fulfill Air Force and Navy joint under3 graduate aviation training requirements, and an as4 sociated ground-based training system consisting of

5 air crew training devices (simulators), courseware, a

6 Training Management System, and contractor sup7 port for the life of the system.

8 ‘‘(5) The Commercial Derivatives Aircraft pro9 gram with respect to all contracts directly related to

10 the acquisition or upgrading of civil-derivative air11 craft for use in (A) foreign military sales of Airborne

12 Warning and Control Systems to foreign govern13 ments with modifications of a type customarily pro14 vided to commercial customers, or (B) future Air

15 Force airlift and tanker requirements.

16 ‘‘(6) The Commercial Derivative Engine pro17 gram with respect to all contracts directly related to

18 the acquisition of (A) commercially derived engines

19 (including spare engines), logistics support equip20 ment, technical orders, management data, and initial

21 spare parts for use in the C–17A production line,

22 and (B) commercially derived engines to support the

23 purchase of commercial-derivative aircraft to meet

24 future Air Force airlift and tanker requirements, in25 cluding engine replacement and upgrades.
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1 ‘‘(b) WAIVER AUTHORITY.—Subject to section 809(c)

2 of the National Defense Authorization Act for Fiscal Year

3 1991, the Secretary of Defense is authorized—

4 ‘‘(1) to apply any amendment or repeal of a

5 provision of law made in the Federal Acquisition

6 Streamlining Act of 1994 to the programs described

7 in subsection (a) before the effective date of such

8 amendment or repeal; and

9 ‘‘(2) to apply to a procurement of noncommer10 cial items under such programs—

11 ‘‘(A) any authority provided in such Act

12 (or in an amendment made by a provision of

13 such Act) to waive a provision of law in the

14 case of commercial items, and

15 ‘‘(B) any exception applicable under such

16 Act (or an amendment made by a provision of

17 such Act) in the case of commercial items,

18 before the effective date of such provision (or

19 amendment) to the extent that the Secretary deter20 mines necessary to test the application of such waiv21 er or exception to procurements of noncommercial

22 items.

23 ‘‘(c) PILOT PROGRAM IMPLEMENTATION.—In exer24 cising the authority provided in section 809 of the Na25 tional Defense Authorization Act for 1991, and in accord-
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1 ance with sections 833 through 839 of this Act, the Sec2 retary of Defense, shall take the following actions:

3 ‘‘(1) MISSION-ORIENTED PROGRAM MANAGE4 MENT.—For one or more of the defense acquisition

5 programs designated for participation in the defense

6 acquisition pilot program, prescribe and implement

7 procedures which—

8 ‘‘(A) provide for interaction between the

9 program manager and the commander of the

10 operational command responsible for the re11 quirement for the equipment acquired;

12 ‘‘(B) include provisions for a determination

13 by the commander that items proposed for pro14 curement fulfill the need defined in approved

15 requirements documents; and

16 ‘‘(C) may include a role for the operational

17 commander in decision making for program

18 milestone decisions and performance of accept19 ance testing of items acquired.

20 ‘‘(2) SAVINGS OBJECTIVES.—Not later than 45

21 days after the date of enactment of the Federal Ac22 quisition Streamlining Act of 1994, identify for each

23 defense acquisition program participating in the

24 pilot program quantitative measures and goals for

25 reducing acquisition management costs.
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1 ‘‘(3) PROGRAM PHASES.—For each defense ac2 quisition program participating in the pilot program,

3 incorporate in an approved acquisition strategy a

4 program review process that provides senior acquisi5 tion officials with reports that—

6 ‘‘(A) contain essential information on pro7 gram results at quarterly intervals;

8 ‘‘(B) reduce data requirements from the

9 current major program review reporting re10 quirements; and

11 ‘‘(C) include data on program costs esti12 mates, actual expenditures, performance esti13 mates, performance data from tests, and, con14 sistent with existing statutes, the minimum nec15 essary other data items required to ensure the

16 appropriate expenditure of funds appropriated

17 for that program.

18 ‘‘(4) PROGRAM WORK FORCE POLICIES.—With

19 regard to the review of incentives and personnel ac20 tions required under section 836 of this Act—

21 ‘‘(A) not later than 60 days after the date

22 of the enactment of the Federal Acquisition

23 Streamlining Act of 1994—

24 ‘‘(i) complete the review; and
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1 ‘‘(ii) on the basis of the review, define

2 one or more systems that relate incentives,

3 including pay, to achievement of budgets,

4 schedules, and performance requirements;

5 ‘‘(B) not later than 120 days after the

6 date of the enactment of the Federal Acquisi7 tion Streamlining Act of 1994—

8 ‘‘(i) apply such a system of incentives

9 to not less than one defense acquisition

10 program participating in the pilot pro11 gram; and

12 ‘‘(ii) provide for an assessment of the

13 effectiveness of that system; and

14 ‘‘(C) incorporate the results of actions

15 taken pursuant to this paragraph into the de16 velopment of regulations for the implementation

17 of section 5001(b) of the Federal Acquisition

18 Streamlining Act of 1994.

19 ‘‘(5) EFFICIENT CONTRACTING PROCESS.—

20 Take any additional actions that the Secretary con21 siders necessary to waive regulations, not required

22 by statute, that affect the efficiency of the contract23 ing process, including, in the Secretary’s discretion,

24 defining alternative techniques to reduce reliance on

25 military specifications and standards in contracts for
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1 the defense acquisition programs participating in the

2 pilot program.

3 ‘‘(6) CONTRACT ADMINISTRATION: PERFORM4 ANCE BASED CONTRACT MANAGEMENT.—For at

5 least one participating defense acquisition program

6 for which a determination is made to make pay7 ments for work in progress under the authority of

8 section 2307 of title 10, United States Code, define

9 payment milestones on the basis of quantitative

10 measures of results.

11 ‘‘(7) CONTRACTOR PERFORMANCE ASSESS12 MENT.—Collect and evaluate performance informa13 tion on each contract entered into for a defense ac14 quisition program participating in the pilot program,

15 including information on cost, schedule, and tech16 nical performance for each contractor supporting a

17 participating program.

18 ‘‘(d) APPLICABILITY.—(1) Subsection (b) applies

19 with respect to—

20 ‘‘(A) a contract that is awarded or modified

21 during the period described in paragraph (2); and

22 ‘‘(B) a contract that is awarded before the be23 ginning of such period and is to be performed (or

24 may be performed), in whole or in part, during such

25 period.
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1 ‘‘(2) The period referred to in paragraph (1) is the

2 period that begins 45 days after the date of the enactment

3 of the Federal Acquisition Streamlining Act of 1994 and

4 ends on September 30, 1998.’’.

5 (b) RULE OF CONSTRUCTION.—Nothing in section

6 840 of the National Defense Authorization Act for Fiscal

7 Year 1994, as added by subsection (a), shall be construed

8 as authorizing the appropriation or obligation of funds for

9 the programs designated for participation in the defense

10 acquisition pilot program under the authority of sub11 section (a) of such section 840.

12 Subtitle B—Civilian Agency

13 Acquisitions

14 SEC. 5051. PERFORMANCE BASED MANAGEMENT.

15 (a) POLICY AND GOALS FOR PERFORMANCE BASED

16 MANAGEMENT OF PROGRAMS.—

17 (1) IN GENERAL.—Title III of the Federal

18 Property and Administrative Services Act of 1949

19 (41 U.S.C. 301 et seq.), as amended by sections

20 1552 and 1553, is further amended by adding at the

21 end the following new section:

22 ‘‘PERFORMANCE BASED MANAGEMENT: ACQUISITION

23 PROGRAMS

24 ‘‘SEC. 311. (a) CONGRESSIONAL POLICY.—It is the

25 policy of Congress that the head of each executive agency

26 should achieve, on average, 90 percent of the cost and
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1 schedule goals established for the research and develop2 ment programs and acquisition programs of the agency

3 without reducing the performance or capabilities of the

4 items being acquired.

5 ‘‘(b) ESTABLISHMENT OF GOALS.—(1) The head of

6 each executive agency shall approve or define the cost, per7 formance, and schedule goals for major acquisition pro8 grams of the agency.

9 ‘‘(2) The chief financial officer of an executive agency

10 shall evaluate the cost goals proposed for each major de11 fense acquisition program of the agency.

12 ‘‘(c) IDENTIFICATION OF NONCOMPLIANT PRO13 GRAMS.—Whenever it is necessary to do so in order to

14 implement the policy set out in subsection (a), the head

15 of an executive agency shall—

16 ‘‘(1) identify and consider whether there is a

17 continuing need for programs that are significantly

18 behind schedule, over budget, or not in compliance

19 with performance or capability requirements taking

20 into consideration—

21 ‘‘(A) the needs of the agency known as of

22 the time of consideration;

23 ‘‘(B) the state of the technology or tech24 nologies relevant to the programs and to the

25 needs of the agency;
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1 ‘‘(C) the estimated costs and projected

2 schedules necessary for the completion of such

3 programs; and

4 ‘‘(D) other pertinent information; and

5 ‘‘(2) identify existing and potential research

6 and development programs and acquisition programs

7 that are suitable alternatives for programs consid8 ered pursuant to paragraph (1).’’.

9 (2) CLERICAL AMENDMENT.—The table of con10 tents in the first section of such Act, as amended by

11 sections 1552 and 1553, is further amended by in12 serting after the item relating to section 310 the fol13 lowing new item:

‘‘Sec. 311. Performance based management: acquisition programs.’’.

14 (b) ANNUAL REPORTING REQUIREMENT.—Section 6

15 of the Office of Federal Procurement Policy Act (41

16 U.S.C. 405), as amended by section 1091, is further

17 amended by adding at the end the following new sub18 section:

19 ‘‘(k) The Administrator shall submit to Congress, on

20 an annual basis, an assessment of the progress made in

21 executive agencies in implementing the policy stated in

22 section 311(a) of the Federal Property and Administrative

23 Services Act of 1949. The Administrator shall use data

24 from existing management systems in making the assess25 ment.’’.
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1 (c) ENHANCED SYSTEM OF PERFORMANCE INCEN2 TIVES.—Within one year after the date of the enactment

3 of this Act, the Administrator for Federal Procurement

4 Policy, in consultation with appropriate officials in other

5 departments and agencies of the Federal Government,

6 shall, to the maximum extent consistent with applicable

7 law—

8 (1) establish policies and procedures for the

9 heads of such departments and agencies to designate

10 acquisition positions and manage employees (includ11 ing the accession, education, training and career de12 velopment of employees) in the designated acquisi13 tion positions;

14 (2) extend to the acquisition workforce of the

15 entire executive branch the acquisition workforce

16 policies contained in chapter 87 of title 10, United

17 States Code, relating to the acquisition workforce of

18 the Department of Defense; and

19 (3) review the incentives and personnel actions

20 available to the heads of department and agencies of

21 the Federal Government for encouraging excellence

22 in the acquisition workforce of the Federal Govern23 ment and provide an enhanced system of incentives

24 for the encouragement of excellence in such

25 workforce which—
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1 (A) relates pay to performance (including

2 the extent to which the performance of person3 nel in such workforce contributes to achieving

4 the cost goals, schedule goals, and performance

5 goals established for acquisition programs pur6 suant to section 311(b) of the Federal Property

7 and Administrative Services Act of 1949, as

8 added by subsection (a)); and

9 (B) provides for consideration, in personnel

10 evaluations and promotion decisions, of the ex11 tent to which the performance of personnel in

12 such workforce contributes to achieving such

13 cost goals, schedule goals, and performance

14 goals.

15 (d) RECOMMENDED LEGISLATION.—Not later than

16 one year after the date of the enactment of this Act, the

17 Administrator for Federal Procurement Policy shall sub18 mit to Congress any recommended legislation that the Sec19 retary considers necessary to carry out section 311 of the

20 Federal Property and Administrative Services Act of

21 1949, as added by subsection (a), and otherwise to facili22 tate and enhance management of Federal Government ac23 quisition programs and the acquisition workforce of the

24 Federal Government on the basis of performance.
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1 SEC. 5052. RESULTS-ORIENTED ACQUISITION PROCESS.

2 (a) DEVELOPMENT OF PROCESS REQUIRED.—The

3 Administrator for Federal Procurement Policy, in con4 sultation with the heads of appropriate Federal agencies,

5 shall develop a results-oriented acquisition process for im6 plementation by agencies in acquisitions of property and

7 services by the Federal agencies. The process shall include

8 the identification of quantitative measures and standards

9 for determining the extent to which an acquisition of non10 commercial items by a Federal agency satisfies the needs

11 for which the items are being acquired.

12 (b) INAPPLICABILITY OF PROCESS TO DEPARTMENT

13 OF DEFENSE.—The process developed pursuant to sub14 section (a) may not be applied to the Department of De15 fense.

16 Subtitle C—Miscellaneous

17 SEC. 5091. CONTRACTOR EXCEPTIONAL PERFORMANCE

18 AWARDS.

19 The Office of Federal Procurement Policy Act, as

20 amended by section 4021, is further amended by adding

21 at the end the following:

22 ‘‘CONTRACTOR EXCEPTIONAL PERFORMANCE AWARDS

23 ‘‘SEC. 31. (a) ESTABLISHMENT.—There is hereby es24 tablished an executive branch program to recognize and

25 promote exceptional contract performance by Federal Gov26 ernment contractors.
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1 ‘‘(b) SELECTION.—(1) The Administrator shall en2 sure the establishment of criteria for selection of contrac3 tors to receive exceptional performance awards under the

4 program.

5 ‘‘(2) The head of an executive agency may select one

6 or more agency contractors to receive an exceptional per7 formance award under the program.

8 ‘‘(c) AWARD CEREMONY.—The Vice President, or the

9 head of the executive agency selecting a contractor for an

10 exceptional performance award, shall present the award

11 to the contractor with such ceremony as the Vice Presi12 dent or head of the agency, as the case may be, considers

13 appropriate.’’.

14 SEC. 5092. DEPARTMENT OF DEFENSE ACQUISITION OF IN15 TELLECTUAL PROPERTY RIGHTS.

16 Section 2386 of title 10, United States Code, is

17 amended by striking out paragraphs (3) and (4) and in18 serting in lieu thereof the following:

19 ‘‘(3) Technical data and computer software.

20 ‘‘(4) Releases for past infringement of patents

21 or copyrights or for unauthorized use of technical

22 data or computer software.’’.
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1 TITLE VI—STANDARDS OF

2 CONDUCT

3 Subtitle A—Ethics Provisions

4 SEC. 6001. AMENDMENTS TO OFFICE OF FEDERAL PRO5 CUREMENT POLICY ACT.

6 (a) RECUSAL.—Subsection (c) of section 27 of the

7 Office of Federal Procurement Policy Act (41 U.S.C. 423)

8 is amended—

9 (1) in paragraph (1)—

10 (A) in the matter above subparagraph (A),

11 by inserting ‘‘only’’ after ‘‘subsection (b)(1)’’;

12 and

13 (B) in subparagraph (A), by inserting

14 ‘‘(including the modification or extension of a

15 contract)’’ after ‘‘any procurement’’;

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

17 inserting in lieu thereof:

18 ‘‘(2) Whenever the head of a procuring activity ap19 proves a recusal under paragraph (1), a copy of the

20 recusal request and the approval of the request shall be

21 retained by such official for a period (not less than five

22 years) specified in regulations prescribed in accordance

23 with subsection (o).

24 ‘‘(3)(A) Except as provided in subparagraph (B), all

25 recusal requests and approvals of recusal requests pursu-
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1 ant to this subsection shall be made available to the public

2 on request.

3 ‘‘(B) Any part of a recusal request or an approval

4 of a recusal request that is exempt from the disclosure

5 requirements of section 552 of title 5, United States Code,

6 under subsection (b)(1) of such section may be withheld

7 from disclosure to the public otherwise required under

8 subparagraph (A).’’; and

9 (3) in paragraph (4), by striking out ‘‘compet10 ing contractor’’ and inserting in lieu thereof ‘‘per11 son’’.

12 (b) APPLICABILITY OF CERTIFICATION REQUIRE13 MENT.—Subsection (e)(7)(A) of such section is amended

14 by adding at the end the following: ‘‘However, paragraph

15 (1)(B) does not apply with respect to a contract for less

16 than $500,000.’’.

17 (c) RESTRICTIONS RESULTING FROM PROCUREMENT

18 ACTIVITIES OF PROCUREMENT OFFICIALS.—Subsection

19 (f) of such section is amended—

20 (1) by redesignating paragraph (3) as para21 graph (4); and

22 (2) by striking out paragraphs (1) and (2) and

23 inserting in lieu thereof the following:

24 ‘‘(1) No individual who, in the year prior to separa25 tion from service as an officer or employee of the Govern-
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1 ment or an officer of the uniformed services in a covered

2 position, participated personally and substantially in ac3 quisition functions related to a contract, subcontract, or

4 claim of $500,000 or more and—

5 ‘‘(A) engaged in repeated direct contact with

6 the contractor or subcontractor on matters relating

7 to such contract, subcontract, or claim; or

8 ‘‘(B) exercised significant ongoing decisionmak9 ing responsibility with respect to the contractor or

10 subcontractor on matters relating to such contract,

11 subcontract, or claim,

12 shall knowingly accept or continue employment with such

13 contractor or subcontractor for a period of 1 year follow14 ing the individual’s separation from service, except that

15 such individual may accept or continue employment with

16 any division or affiliate of such contractor or subcontrac17 tor that does not produce the same or similar products

18 as the entity involved in the negotiation or performance

19 of the contract or subcontract or the adjustment of the

20 claim.

21 ‘‘(2) No contractor or subcontractor, or any officer,

22 employee, agent, or consultant of such contractor or sub23 contractor shall knowingly offer, provide, or continue any

24 employment for another person, if such contractor, sub25 contractor, officer, employee, agent, or consultant knows
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1 or should know that the acceptance of such employment

2 is or would be in violation of paragraph (1).

3 ‘‘(3) The head of each Federal agency shall designate

4 in writing as a ‘covered position’ under this section each

5 of the following positions in that agency:

6 ‘‘(A) The position of source selection authority,

7 member of a source selection evaluation board, or

8 chief of a financial or technical evaluation team, or

9 any other position, if the officer or employee in that

10 position is likely personally to exercise substantial

11 responsibility for ongoing discretionary functions in

12 the evaluation of proposals or the selection of a

13 source for a contract in excess of $500,000.

14 ‘‘(B) The position of procuring contracting offi15 cer, or any other position, if the officer or employee

16 in that position is likely personally to exercise sub17 stantial responsibility for ongoing discretionary func18 tions in the negotiation of a contract in excess of

19 $500,000 or the negotiation or settlement of a claim

20 in excess of $500,000.

21 ‘‘(C) The position of program executive officer,

22 program manager, or deputy program manager, or

23 any other position, if the officer or employee in that

24 position is likely personally to exercise similar sub25 stantial responsibility for ongoing discretionary func-
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1 tions in the management or administration of a con2 tract in excess of $500,000.

3 ‘‘(D) The position of administrative contracting

4 officer, the position of an officer or employee as5 signed on a permanent basis to a Government Plant

6 Representative’s Office, the position of auditor, a

7 quality assurance position, or any other position, if

8 the officer or employee in that position is likely per9 sonally to exercise substantial responsibility for on10 going discretionary functions in the on-site oversight

11 of a contractor’s operations with respect to a con12 tract in excess of $500,000.

13 ‘‘(E) A position in which the incumbent is likely

14 personally to exercise substantial responsibility for

15 ongoing discretionary functions in operational or de16 velopmental testing activities involving repeated di17 rect contact with a contractor regarding a contract

18 in excess of $500,000.’’.

19 (d) DISCLOSURE OF PROPRIETARY OR SOURCE SE20 LECTION INFORMATION TO UNAUTHORIZED PERSONS.—

21 Subsection (l) of such section is amended—

22 (1) by inserting ‘‘who are likely to be involved

23 in contracts, modifications, or extensions in excess of

24 $25,000’’ in the first sentence after ‘‘its procure25 ment officials’’; and
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1 (2) by striking out ‘‘(e)’’ each place it appears

2 and inserting in each such place ‘‘(f)’’.

3 (e) RULES OF CONSTRUCTION.—Subsection (n) of

4 such section is amended to read as follows:

5 ‘‘(n) RULES OF CONSTRUCTION.—Nothing in this

6 section shall be construed to—

7 ‘‘(1) authorize the withholding of any informa8 tion from the Congress, any committee or sub9 committee thereof, a Federal agency, any board of

10 contract appeals of a Federal agency, the Comptrol11 ler General, or an inspector general of a Federal

12 agency;

13 ‘‘(2) restrict the disclosure of information to, or

14 receipt of information by, any person or class of per15 sons authorized, in accordance with applicable agen16 cy regulations or procedures, to receive that infor17 mation;

18 ‘‘(3) restrict a contractor from disclosing its

19 own proprietary information or the recipient of in20 formation so disclosed by a contractor from receiving

21 such information; or

22 ‘‘(4) restrict the disclosure or receipt of infor23 mation relating to a Federal agency procurement

24 that has been canceled by the agency and that the
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1 contracting officer concerned determines in writing

2 is not likely to be resumed.’’.

3 (f) TERM TO BE DEFINED IN REGULATIONS.—Sub4 section (o)(2)(A) of such section is amended—

5 (1) by inserting ‘‘money, gratuity, or other’’ be6 fore ‘‘thing of value’ ’’; and

7 (2) by inserting before the semicolon ‘‘and such

8 other exceptions as may be adopted on a Govern9 mentwide basis under section 7353 of title 5, United

10 States Code’’.

11 (g) TERMS DEFINED IN LAW.—Subsection (p) of

12 such section is amended—

13 (1) in paragraph (1) by striking out ‘‘clauses

14 (i)–(viii)’’ and inserting in lieu thereof ‘‘clauses (i)

15 through (vii)’’;

16 (2) in paragraph (3)—

17 (A) in subparagraph (A)—

18 (i) by striking out clause (i);

19 (ii) by redesignating clauses (ii), (iii),

20 (iv), (v), (vi), (vii), and (viii) as clauses (i),

21 (ii), (iii), (iv), (v), (vi), and (vii), respec22 tively; and

23 (iii) in clause (i) (as redesignated by

24 subclause (II) of this clause), by striking

25 out ‘‘review and approval of a specifica-
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1 tion’’ and inserting in lieu thereof ‘‘ap2 proval or issuance of a specification, acqui3 sition plan, procurement request, or req4 uisition’’; and

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

6 all after ‘‘includes’’ and inserting in lieu thereof

7 the following: ‘‘any individual acting on behalf

8 of, or providing advice to, the agency with re9 spect to any phase of the agency procurement

10 concerned, regardless of whether such individ11 ual is a consultant, expert, or adviser, or an of12 ficer or employee of a contractor or subcontrac13 tor (other than a competing contractor).’’; and

14 (3) in paragraph (6)(A), by inserting

15 ‘‘nonpublic’’ before ‘‘information’’.

16 SEC. 6002. AMENDMENTS TO TITLE 18, UNITED STATES

17 CODE.

18 Section 208(a) of title 18, United States Code, is

19 amended—

20 (1) by inserting ‘‘(1)’’ before ‘‘Except as per21 mitted’’; and

22 (2) by adding at the end the following new

23 paragraph:

24 ‘‘(2) Whoever knowingly aids, abets, counsels, com25 mands, induces, or procures conduct prohibited by this
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1 section shall be subject to the penalties set forth in section

2 216 of this title.’’.

3 SEC. 6003. REPEAL OF SUPERSEDED AND OBSOLETE LAWS.

4 (a) REPEAL.—The following provisions of law are re5 pealed:

6 (1) Sections 2207, 2397, 2397a, 2397b, and

7 2397c of title 10, United States Code.

8 (2) Section 281 of title 18, United States Code.

9 (3) Section 801 of title 37, United States Code.

10 (4) Part A of title VI of the Department of En11 ergy Organization Act (42 U.S.C. 7211 through

12 7218).

13 (b) CLERICAL AMENDMENTS.—

14 (1) TITLE 10.—Part IV of subtitle A of title 10,

15 United States Code, is amended—

16 (A) in the table of sections at the begin17 ning of chapter 131, by striking out the item

18 relating to section 2207; and

19 (B) in the table of sections for chapter

20 141, by striking out the items relating to sec21 tions 2397, 2397a, 2397b, and 2397c.

22 (2) TITLE 18.—The table of sections for chap23 ter 15 of title 18, United States Code, is amended

24 by striking out the item relating to section 281.
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1 (3) TITLE 37.—The table of sections for chap2 ter 15 of title 37, United States Code, is amended

3 by striking out the item relating to section 801.

4 (4) DEPARTMENT OF ENERGY ORGANIZATION

5 ACT.—The table of contents for the Department of

6 Energy Organization Act is amended by striking out

7 the matter relating to part A of title VI.

8 SEC. 6004. IMPLEMENTATION.

9 (a) REGULATIONS.—Not later than 180 days after

10 the date of the enactment of this Act, regulations imple11 menting the amendments made by section 6001 to section

12 27 of the Office of Federal Procurement Policy Act (41

13 U.S.C. 423), including definitions of the terms used in

14 subsection (f) of such section, shall be issued in accord15 ance with sections 6 and 25 of such Act (41 U.S.C. 405

16 and 521) after coordination with the Director of the Office

17 of Government Ethics.

18 (b) SAVINGS PROVISIONS.—

19 (1) CONTRACTOR CERTIFICATIONS.—No officer,

20 employee, agent, representative, or consultant of a

21 contractor who has signed a certification under sec22 tion 27(e)(1)(B) of the Office of Federal Procure23 ment Policy Act (41 U.S.C. 423(e)(1)(B)) before the

24 effective date of this Act shall be required to sign a
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1 new certification as a result of the enactment of this

2 Act.

3 (2) FEDERAL PROCUREMENT OFFICIAL CER4 TIFICATIONS.—No procurement official of a Federal

5 agency who has signed a certification under section

6 27(l) of the Office of Federal Procurement Policy

7 Act (41 U.S.C. 423(l)) before the date of enactment

8 of this Act shall be required to sign a new certifi9 cation as a result of the enactment of this Act.

10 (c) INSPECTOR GENERAL REPORTS.—Not later than

11 May 31 of each of the years 1995 through 1998, the In12 spector General of each Federal agency (or, in the case

13 of a Federal agency that does not have an Inspector Gen14 eral, the head of such agency) shall submit to Congress

15 a report on the compliance by the agency during the pre16 ceding year with the requirement for the head of the agen17 cy to designate covered procurement positions under sec18 tion 27(f)(3) of the Office of Federal Procurement Policy

19 Act (as added by section 6001(c)).

20 Subtitle B—Additional

21 Amendments

22 SEC. 6051. CONTRACTING FUNCTIONS PERFORMED BY FED23 ERAL PERSONNEL.

24 (a) AMENDMENT OF OFPP ACT.—The Office of Fed25 eral Procurement Policy Act, as amended by section 1092,
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1 is further amended by inserting after section 22 the fol2 lowing new section 23:

3 ‘‘CONTRACTING FUNCTIONS PERFORMED BY FEDERAL

4 PERSONNEL

5 ‘‘SEC. 23. (a) LIMITATION ON PAYMENT FOR ADVI6 SORY AND ASSISTANCE SERVICES.—(1) No person who is

7 not a person described in subsection (b) may be paid by

8 an agency for services to conduct evaluations or analyses

9 of any aspect of a proposal submitted for an acquisition

10 unless personnel described in subsection (b) with adequate

11 training and capabilities to perform such evaluations and

12 analyses are not readily available within the agency or an13 other Federal agency, as determined in accordance with

14 standards and procedures prescribed in the Federal Acqui15 sition Regulation.

16 ‘‘(2) In the administration of this subsection, the

17 head of each agency shall determine in accordance with

18 the standards and procedures set forth in the Federal Ac19 quisition Regulation whether—

20 ‘‘(A) a sufficient number of personnel described

21 in subsection (b) within the agency or another Fed22 eral agency are readily available to perform a par23 ticular evaluation or analysis for the agency head

24 making the determination; and
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1 ‘‘(B) the readily available personnel have the

2 training and capabilities necessary to perform the

3 evaluation or analysis.

4 ‘‘(b) COVERED PERSONNEL.—For purposes of sub5 section (a), the personnel described in this subsection are

6 as follows:

7 ‘‘(1) An employee, as defined in section 2105 of

8 title 5, United States Code.

9 ‘‘(2) A member of the Armed Forces of the

10 United States.

11 ‘‘(3) A person assigned to a Federal agency

12 pursuant to subchapter VI of chapter 33 of title 5,

13 United States Code.

14 ‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sec15 tion is intended to affect the relationship between the Fed16 eral Government and a federally funded research and de17 velopment center.’’.

18 (b) REQUIREMENT FOR GUIDANCE AND REGULA19 TIONS.—Not later than 90 days after the date of the en20 actment of this Act, the Federal Acquisition Regulatory

21 Council established by section 25(a) of the Office of Fed22 eral Procurement Policy Act (41 U.S.C. 421(a)) shall—

23 (1) review part 37 of title 48 of the Code of

24 Federal Regulations as it relates to the use of advi25 sory and assistance services; and
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1 (2) provide guidance and promulgate regula2 tions regarding—

3 (A) what actions Federal agencies are re4 quired to take to determine whether expertise is

5 readily available within the Federal Government

6 before contracting for advisory and technical

7 services to conduct acquisitions; and

8 (B) the manner in which personnel with

9 expertise may be shared with agencies needing

10 expertise for such acquisitions.

11 SEC. 6052. REPEAL OF EXECUTED REQUIREMENT FOR

12 STUDY AND REPORT.

13 Section 17 of the Office of Federal Procurement Pol14 icy Act (41 U.S.C. 415) is repealed.

15 SEC. 6053. INTERESTS OF MEMBERS OF CONGRESS.

16 Section 3741 of the Revised Statutes (41 U.S.C. 22)

17 is amended to read as follows:

18 ‘‘No member of Congress shall be admitted to any

19 share or part of any contract or agreement made, entered

20 into, or accepted by or on behalf of the United States,

21 or to any benefit to arise thereupon.’’.

22 SEC. 6054. WAITING PERIOD FOR SIGNIFICANT CHANGES

23 PROPOSED FOR ACQUISITION REGULATIONS.

24 Section 22(a) of the Office of Federal Procurement

25 Policy Act (41 U.S.C. 418b) is amended—
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1 (1) by striking out ‘‘30 days’’ and inserting in

2 lieu thereof ‘‘60 days’’; and

3 (2) by adding at the end the following: ‘‘Not4 withstanding the preceding sentence, such a policy,

5 regulation, procedure, or form may take effect ear6 lier than 60 days after the publication date when

7 there are compelling circumstances for the earlier

8 effective date, but in no event may that effective

9 date be less than 30 days after the publication

10 date.’’.

11 Subtitle C—Whistleblower

12 Protection

13 SEC. 6101. ARMED SERVICES PROCUREMENTS.

14 (a) WHISTLEBLOWER PROTECTIONS FOR CONTRAC15 TOR EMPLOYEES.—Section 2409 of title 10, United

16 States Code, is amended—

17 (1) by striking out subsection (d);

18 (2) by redesignating subsection (c) as sub19 section (d); and

20 (3) by inserting after subsection (b) the follow21 ing new subsection (c):

22 ‘‘(c) REMEDY AND ENFORCEMENT AUTHORITY.—(1)

23 If the Secretary of Defense determines that a defense con24 tractor has subjected a person to a reprisal prohibited by
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1 subsection (a), the Secretary may take one or more of the

2 following actions:

3 ‘‘(A) Order the defense contractor to take af4 firmative action to abate the reprisal.

5 ‘‘(B) Order the defense contractor to reinstate

6 the person to the position that the person held be7 fore the reprisal, together with the compensation (in8 cluding back pay), employment benefits, and other

9 terms and conditions of employment that would

10 apply to the person in that position if the reprisal

11 had not been taken.

12 ‘‘(C) Order the defense contractor to pay the

13 complainant an amount equal to the aggregate

14 amount of all costs and expenses (including attor15 ney’s fees and expert witnesses’ fees) that were rea16 sonably incurred by the complainant for, or in con17 nection with, bringing the complaint regarding the

18 reprisal, as determined by the Secretary.

19 ‘‘(2) Whenever a person fails to comply with an order

20 issued under paragraph (1), the Secretary shall file an ac21 tion for enforcement of such order in the United States

22 district court for a district in which the reprisal was found

23 to have occurred. In any action brought under this para24 graph, the court may grant appropriate relief, including
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1 injunctive relief and compensatory and exemplary dam2 ages.

3 ‘‘(3) Any person adversely affected or aggrieved by

4 an order issued under paragraph (1) may obtain review

5 of the order’s conformance with this subsection, and any

6 regulations issued to carry out this section, in the United

7 States court of appeals for a circuit in which the reprisal

8 is alleged in the order to have occurred. No petition seek9 ing such review may be filed more than 60 days after issu10 ance of the Secretary’s order. Review shall conform to

11 chapter 7 of title 5.’’.

12 (b) RELATED LAW.—

13 (1) REPEAL.—Section 2409a of title 10, United

14 States Code, is repealed.

15 (2) CLERICAL AMENDMENT.—The table of sec16 tions at the beginning of chapter 141 of such title

17 is amended by striking out the item relating to sec18 tion 2409a.

19 SEC. 6102. GOVERNMENTWIDE WHISTLEBLOWER PROTEC20 TIONS FOR CONTRACTOR EMPLOYEES.

21 The Office of Federal Procurement Policy Act (41

22 U.S.C. 401 et seq.), as amended by section 5091, is fur23 ther amended by adding at the end the following new sec24 tion:
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1 ‘‘CONTRACTOR EMPLOYEES: PROTECTION FROM REPRISAL

2 FOR DISCLOSURE OF CERTAIN INFORMATION

3 ‘‘SEC. 32. (a) PROHIBITION OF REPRISALS.—An em4 ployee of an executive agency contractor may not be dis5 charged, demoted, or otherwise discriminated against as

6 a reprisal for disclosing to a Member of Congress or an

7 authorized official of the agency or the Department of

8 Justice information relating to a substantial violation of

9 law related to an agency contract (including the competi10 tion for or negotiation of an agency contract).

11 ‘‘(b) INVESTIGATION OF COMPLAINTS.—A person

12 who believes that the person has been subjected to a re13 prisal prohibited by subsection (a) may submit a complaint

14 to the Inspector General of the executive agency. Unless

15 the Inspector General determines that the complaint is

16 frivolous, the Inspector General shall investigate the com17 plaint and, upon completion of such investigation, submit

18 a report of the findings of the investigation to the person,

19 the contractor concerned, and the head of the agency. In

20 the case of an executive agency that does not have an in21 spector general, the duties of the inspector general under

22 this section shall be performed by an official designated

23 by the agency head.

24 ‘‘(c) REMEDY AND ENFORCEMENT AUTHORITY.—(1)

25 If the head of an executive agency determines that an
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1 agency contractor has subjected a person to a reprisal pro2 hibited by subsection (a), the agency head may take one

3 or more of the following actions:

4 ‘‘(A) Order the contractor to take affirmative

5 action to abate the reprisal.

6 ‘‘(B) Order the contractor to reinstate the per7 son to the position that the person held before the

8 reprisal, together with the compensation (including

9 back pay), employment benefits, and other terms

10 and conditions of employment that would apply to

11 the person in that position if the reprisal had not

12 been taken.

13 ‘‘(C) Order the contractor to pay the complain14 ant an amount equal to the aggregate amount of all

15 costs and expenses (including attorney’s fees and ex16 pert witnesses’ fees) that were reasonably incurred

17 by the complainant for, or in connection with, bring18 ing the complaint regarding the reprisal, as deter19 mined by the Secretary.

20 ‘‘(2) Whenever a person fails to comply with an order

21 issued under paragraph (1), the agency head shall file an

22 action for enforcement of such order in the United States

23 district court for a district in which the reprisal was found

24 to have occurred. In any action brought under this para25 graph, the court may grant appropriate relief, including
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1 injunctive relief and compensatory and exemplary dam2 ages.

3 ‘‘(3) Any person adversely affected or aggrieved by

4 an order issued under paragraph (1) may obtain review

5 of the order’s conformance with this subsection, and any

6 regulations issued to carry out this section, in the United

7 States court of appeals for a circuit in which the reprisal

8 is alleged in the order to have occurred. No petition seek9 ing such review may be filed more than 60 days after issu10 ance of the agency head’s order. Review shall conform to

11 chapter 7 of title 5, United States Code.

12 ‘‘(d) CONSTRUCTION.—Nothing in this section may

13 be construed to authorize the discharge of, demotion of,

14 or discrimination against an employee for a disclosure

15 other than a disclosure protected by subsection (a) or to

16 modify or derogate from a right or remedy otherwise avail17 able to the employee.

18 ‘‘(e) COORDINATION WITH OTHER LAW.—This sec19 tion does not apply with respect to the Department of De20 fense. For the corresponding provision of law applicable

21 to the Department of Defense, see section 2409 of title

22 10, United States Code.

23 ‘‘(f) DEFINITION.—In this section, the term ‘Inspec24 tor General’ means an Inspector General appointed under

25 the Inspector General Act of 1978.’’.
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1 TITLE VII—DEFENSE TRADE AND

2 COOPERATION

3 SEC. 7001. PURCHASES OF FOREIGN GOODS.

4 (a) REPEAL OF EXECUTED REQUIREMENTS.—

5 (1) REQUIREMENT FOR POLICY GUIDANCE.—

6 Title III of the Act of March 3, 1933 (41 U.S.C.

7 10a et seq.), commonly referred to as the ‘‘Buy

8 American Act’’, is amended in section 4(g) (41

9 U.S.C. 10b–1(g)) by striking out paragraphs (2)(C)

10 and (3).

11 (2) REPORTING REQUIREMENT.—Section

12 9096(b) of Public Law 102–396 (106 Stat. 1924; 41

13 U.S.C. 10b–2(b)) is repealed.

14 (b) REPEAL OF REDUNDANT PROVISION.—

15 (1) CONSIDERATION OF NATIONAL SECURITY

16 OBJECTIVES.—Section 2327 of title 10, United

17 States Code, is repealed.

18 (2) CLERICAL AMENDMENT.—The table of sec19 tions at the beginning of chapter 137 of such title

20 is amended by striking out the item relating to sec21 tion 2327.

22 SEC. 7002. INTERNATIONAL COOPERATIVE AGREEMENTS.

23 (a) TERMINOLOGY REVISIONS.—Section 2531 of title

24 10, United States Code, is amended—
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1 (1) in the subsection captions for subsections

2 (a) and (c), by striking out ‘‘MOUS AND RELATED’’

3 and inserting in lieu thereof ‘‘INTERNATIONAL’’;

4 (2) in subsection (a), by striking out ‘‘proposed

5 memorandum of understanding, or any existing or

6 proposed agreement related to a memorandum of

7 understanding,’’ in the matter above paragraph (1)

8 and inserting in lieu thereof ‘‘proposed international

9 agreement, including a memorandum of understand10 ing,’’;

11 (3) by striking out ‘‘memorandum of under12 standing or related agreement’’ each place it appears

13 and inserting in lieu thereof ‘‘international agree14 ment’’;

15 (4) in subsection (b), by striking out ‘‘memo16 randum or related agreement’’ each place it appears

17 in the second sentence and inserting in lieu thereof

18 ‘‘international agreement’’; and

19 (5) in subsection (c)—

20 (A) by striking out ‘‘A’’ after ‘‘AGREE21 MENTS.—’’ and inserting in lieu thereof ‘‘An’’;

22 and

23 (B) by striking out ‘‘memorandum or

24 agreement’’ and inserting in lieu thereof ‘‘inter25 national agreement’’.
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1 (b) EXPANDED SCOPE OF AGREEMENTS.—Section

2 2531(a) of title 10, United States Code, is amended by

3 striking out ‘‘research, development, or production’’ in the

4 matter above paragraph (1) and inserting in lieu thereof

5 ‘‘research, development, production, or logistics support’’.

6 (c) CLERICAL AMENDMENTS.—

7 (1) SECTION HEADING.—The heading of section

8 2531 of title 10, United States Code, is amended to

9 read as follows:

10 ‘‘§ 2531. Defense international agreements’’.

11 (2) TABLE OF SECTIONS.—The item relating to

12 such section in the table of sections at the beginning

13 of subchapter V of chapter 148 of such title is

14 amended to read as follows:

‘‘2531. Defense international agreements.’’.

15 SEC. 7003. ACQUISITION, CROSS-SERVICING AGREEMENTS,

16 AND STANDARDIZATION.

17 (a) LIMITED WAIVER OF RESTRICTIONS ON AC18 CRUED REIMBURSABLE LIABILITIES AND CREDITS FOR

19 CONTINGENCY OPERATIONS.—Section 2347 of title 10,

20 United States Code, is amended by adding at the end the

21 following new subsection:

22 ‘‘(c) The Secretary of Defense may waive the restric23 tions in subsections (a) and (b) for a period not to exceed

24 180 days upon a written determination that the armed

25 forces are involved in a contingency operation or that in-
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1 volvement of the armed forces in a contingency operation

2 is imminent. Upon making such a determination, the Sec3 retary shall transmit a copy of the determination to the

4 Committees on Armed Services of the Senate and House

5 of Representatives.’’.

6 (b) COMMUNICATIONS SUPPORT.—Section 2350f of

7 title 10, United States Code, is amended—

8 (1) by redesignating subsection (d) as sub9 section (e); and

10 (2) by inserting after subsection (c) the follow11 ing new subsection:

12 ‘‘(d)(1) Nothing in this section shall be construed to

13 limit the authority of the Secretary of Defense, without

14 a formal bilateral agreement or multilateral arrangement,

15 to furnish communications support and related supplies

16 to, or receive communications support and related supplies

17 from, an allied country in accordance with this subsection.

18 ‘‘(2) The Secretary of Defense may furnish or receive

19 such support and supplies on a reciprocal basis for a pe20 riod not to exceed 90 days—

21 ‘‘(A) in order to meet emerging operational re22 quirements of the United States and the allied coun23 try; or

24 ‘‘(B) incident to a joint military exercise with

25 the allied country.
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1 ‘‘(3) If interconnection of communication circuits is

2 maintained for joint or multilateral defense purposes

3 under the authority of this subsection, the costs of main4 taining such circuits may be allocated among the various

5 users.’’.

6 TITLE VIII—COMMERCIAL ITEMS

7 SEC. 8001. DEFINITIONS.

8 Section 4 of the Office of Federal Procurement Policy

9 Act (41 U.S.C. 403), as amended by section 4001(a), is

10 further amended—

11 (1) by striking out ‘‘Act—’’and inserting in lieu

12 thereof ‘‘Act:’’;

13 (2) by capitalizing the initial letter in the first

14 word of each paragraph;

15 (3) by striking out the semicolon at the end of

16 each of paragraphs (1), (2), (3), (5), (6), (7), (8),

17 and (9) and inserting in lieu thereof a period;

18 (4) in paragraphs (4) and (10), by striking out

19 ‘‘; and’’ at the end and inserting in lieu thereof a

20 period; and

21 (5) by adding at the end the following new

22 paragraphs:

23 ‘‘(12) The term ‘commercial item’ means—

24 ‘‘(A) property, other than real property,

25 that is of a type customarily used by the gen-
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1 eral public or by nongovernmental entities in

2 the course of normal business operations for

3 purposes other than governmental purposes

4 and—

5 ‘‘(i) has been sold, leased, or licensed

6 to the general public;

7 ‘‘(ii) has not been sold, leased, or li8 censed to the general public but has been

9 offered for sale, lease, or license to the

10 general public; or

11 ‘‘(iii) is not yet available in the com12 mercial marketplace but will be made

13 available for commercial delivery within a

14 reasonable period;

15 ‘‘(B) any item that, but for—

16 ‘‘(i) modifications of a type customar17 ily available in the commercial market18 place, or

19 ‘‘(ii) minor modifications made to

20 meet Federal Government requirements,

21 would satisfy the criteria in subparagraph (A);

22 ‘‘(C) any combination of items meeting the

23 requirements of subparagraph (A), (B), or (D)

24 that are of a type customarily combined and

25 sold in combination to the general public;
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1 ‘‘(D) installation services, maintenance

2 services, repair services, training services, and

3 other services if such services are procured for

4 support of an item referred to in subparagraph

5 (A), (B), or (C) and if the source of such serv6 ices—

7 ‘‘(i) offers such services to the general

8 public and the Federal Government con9 temporaneously and under similar terms

10 and conditions; and

11 ‘‘(ii) offers to use the same work force

12 for providing the Federal Government with

13 such services as the source uses for provid14 ing such services to the general public; and

15 ‘‘(E) any item, combination of items, or

16 service referred to in subparagraph (A), (B),

17 (C), or (D), regardless of whether the item,

18 combination of items, or service is transferred

19 between or among separate divisions, subsidi20 aries, or affiliates of a contractor.

21 ‘‘(13) The term ‘nondevelopmental item’

22 means—

23 ‘‘(A) any commercial item;

24 ‘‘(B) any previously developed item of sup25 ply that is in use by a department or agency of
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1 the United States, a State or local government,

2 or a foreign government with which the United

3 States has a mutual defense cooperation agree4 ment;

5 ‘‘(C) any item of supply described in sub6 paragraph (A) or (B) that requires only minor

7 modification of the type normally available in

8 the commercial marketplace in order to meet

9 the requirements of the procuring department

10 or agency; or

11 ‘‘(D) any item of supply currently being

12 produced that does not meet the requirements

13 of subparagraph (A), (B), or (C) solely because

14 the item—

15 ‘‘(i) is not yet in use; or

16 ‘‘(ii) is not yet available in the com17 mercial marketplace.

18 ‘‘(14) The term ‘component’ means any item

19 supplied to the Federal Government as part of an

20 end item or of another component.

21 ‘‘(15) The term ‘commercial component’ means

22 any component that is a commercial item.’’.
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1 SEC. 8002. PREFERENCE FOR ACQUISITION OF COMMER2 CIAL ITEMS AND NONDEVELOPMENTAL

3 ITEMS.

4 (a) PREFERENCE REQUIRED.—The Office of Federal

5 Procurement Policy Act (41 U.S.C. 401 et seq.), as

6 amended by section 6102, is further amended by adding

7 at the end the following new section:

8 ‘‘PREFERENCE FOR ACQUISITION OF COMMERCIAL ITEMS

9 AND NONDEVELOPMENTAL ITEMS

10 ‘‘SEC. 33. (a) PREFERENCE.—The head of each exec11 utive agency shall ensure that, to the maximum extent

12 practicable—

13 ‘‘(1) requirements of the executive agency with

14 respect to a procurement of supplies are stated in

15 terms of—

16 ‘‘(A) functions to be performed;

17 ‘‘(B) performance required; or

18 ‘‘(C) essential physical characteristics;

19 ‘‘(2) such requirements are defined so that

20 commercial items or, to the extent that commercial

21 items suitable to meet the agency’s needs are not

22 available, other nondevelopmental items may be pro23 cured to fulfill such requirements; and

24 ‘‘(3) offerors of commercial items and other

25 nondevelopmental items are provided an opportunity
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1 to compete in any procurement to fill such require2 ments.

3 ‘‘(b) IMPLEMENTATION.—The head of each executive

4 agency shall ensure that procurement officials in that ex5 ecutive agency, to the maximum extent practicable—

6 ‘‘(1) acquire commercial items or other

7 nondevelopmental items to meet the needs of the ex8 ecutive agency;

9 ‘‘(2) require prime contractors and subcontrac10 tors at all levels under the executive agency con11 tracts to incorporate commercial items or other

12 nondevelopmental items as components of items sup13 plied to the executive agency;

14 ‘‘(3) modify requirements in appropriate cases

15 to ensure that the requirements can be met by com16 mercial items or, to the extent that commercial

17 items suitable to meet the agency’s needs are not

18 available, other nondevelopmental items;

19 ‘‘(4) state specifications in terms that enable

20 and encourage bidders and offerors to supply com21 mercial items or, to the extent that commercial

22 items suitable to meet the agency’s needs are not

23 available, other nondevelopmental items in response

24 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

6 ‘‘(6) require training of appropriate personnel

7 in the acquisition of commercial items.

8 ‘‘(c) PRELIMINARY MARKET RESEARCH.—(1) The

9 head of an executive agency shall conduct market research

10 appropriate to the circumstances—

11 ‘‘(A) before developing new specifications for a

12 procurement by that executive agency; and

13 ‘‘(B) before soliciting bids or proposals for a

14 contract in excess of the simplified acquisition

15 threshold.

16 ‘‘(2) The head of an executive agency shall use the

17 results of market research to determine whether there are

18 commercial items or, to the extent that commercial items

19 suitable to meet the agency’s needs are not available, other

20 nondevelopmental items available that—

21 ‘‘(A) meet the executive agency’s requirements;

22 ‘‘(B) could be modified to meet the executive

23 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. 34. (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 required terms and conditions for the acquisition

24 of commercial items and commercial components by execu25 tive agencies and by contractors in the performance of

26 contracts 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 ‘‘(2) Subject to paragraph (3), the Federal Acquisi14 tion Regulation shall require that, to the maximum extent

15 practicable, only the contract clauses referred to in para16 graph (1) be used in a contract, or be required to be used

17 in a subcontract, for the acquisition of commercial items

18 or commercial components by or for an executive agency.

19 ‘‘(3) The Federal Acquisition Regulation shall pro20 vide that a contract or subcontract referred to in para21 graph (2) may contain contract clauses other than the

22 contract clauses referred to in that paragraph only if the

23 other clauses are essential for the protection of the Fed24 eral Government’s interest in—
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1 ‘‘(A) that contract or subcontract, as deter2 mined in writing by the contracting officer for such

3 contract; or

4 ‘‘(B) a class of contracts or subcontracts, as de5 termined by the head of an agency concerned, unless

6 the determination of that head of an agency is dis7 approved by the Administrator.

8 ‘‘(4) The Federal Acquisition Regulation shall pro9 vide standards and procedures for waiving the use of con10 tract clauses required pursuant to paragraph (1), other

11 than those required by law, including standards for deter12 mining the cases in which a waiver is appropriate.

13 ‘‘(b) MARKET ACCEPTANCE.—The Federal Acquisi14 tion Regulation shall provide that under appropriate con15 ditions the head of an executive agency may require

16 offerors to demonstrate that the items offered—

17 ‘‘(1) have either—

18 ‘‘(A) achieved commercial market accept19 ance; or

20 ‘‘(B) been satisfactorily supplied to an ex21 ecutive agency under current or recent con22 tracts for the same or similar requirements; and

23 ‘‘(2) otherwise meet the item description, speci24 fications, or other criteria prescribed in the public

25 notice and solicitation relating to the contract.
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1 ‘‘(c) USE OF FIRM, FIXED PRICE CONTRACTS.—The

2 Federal Acquisition Regulation shall include a require3 ment that firm, fixed price contracts or fixed price with

4 economic price adjustment contracts, be used, to the maxi5 mum extent practicable, for the acquisition of commercial

6 items.

7 ‘‘(d) CONTRACT QUALITY REQUIREMENTS.—The

8 Federal Acquisition Regulation shall include provisions

9 that—

10 ‘‘(1) permit, to the maximum extent prac11 ticable, a contractor under a commercial items ac12 quisition to use the contractor’s existing quality as13 surance system as a substitute for compliance with

14 a requirement for the Federal Government to inspect

15 or test the commercial items before the contractor’s

16 tender of those items for acceptance by the Federal

17 Government;

18 ‘‘(2) require that, to the maximum extent prac19 ticable, an executive agency accept commercial war20 ranties (including extended warranties) offered by

21 offerors of commercial items to commercial cus22 tomers and use such warranties for the repair and

23 replacement of commercial items; and
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1 ‘‘(3) set forth guidance to executive agencies re2 garding the use of past performance of items and

3 sources as a factor in contract award decisions.’’.

4 ‘‘(e) TREATMENT OF TRANSFERS BETWEEN AFFILI5 ATES.—The Federal Acquisition Regulation shall provide

6 for a transfer of commercial items from one division, sub7 sidiary, or affiliate of a contractor to another division, sub8 sidiary, or affiliate of the contractor to be treated as a

9 subcontract for purposes of section 35 of the Office of

10 Federal Procurement Policy Act and the provisions of law

11 amended by section 8005 of the Federal Acquisition

12 Streamlining Act of 1994.’’.

13 (b) DEFENSE CONTRACT CLAUSES.—

14 (1) TERMINATION OF DOD AUTHORITY.—Sec15 tion 824(b) of the National Defense Authorization

16 Act for Fiscal Years 1990 and 1991 (Public Law

17 101–189; 10 U.S.C. 2325 note) shall cease to be ef18 fective on the date on which the regulations imple19 menting section 34 of the Office of Federal Procure20 ment Policy Act, as added by subsection (a), become

21 effective.

22 (2) SAVINGS PROVISION.—Notwithstanding sec23 tion 34(a) of the Office of Federal Procurement Pol24 icy Act (as added by subsection (a)), contracts of the

25 Department of Defense entered into before the date
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1 on which section 824(b) ceases to be effective under

2 paragraph (1), and subcontracts entered into before

3 such date under such contracts, may include clauses

4 developed pursuant to paragraphs (2) and (3) of sec5 tion 824(b) of the National Defense Authorization

6 Act for Fiscal Years 1990 and 1991 (Public Law

7 101–189; 10 U.S.C. 2325 note).

8 SEC. 8004. CLASS WAIVER OF APPLICABILITY OF CERTAIN

9 LAWS.

10 The Office of Federal Procurement Policy Act (41

11 U.S.C. 401 et seq.), as amended by section 8003, is fur12 ther amended by adding at the end the following:

13 ‘‘CLASS WAIVER OF APPLICABILITY OF CERTAIN LAWS TO

14 ACQUISITIONS OF COMMERCIAL ITEMS

15 ‘‘SEC. 35. (a) IN GENERAL.—The applicability of a

16 provision of law described in subsection (c) that is enacted

17 after the date of the enactment of the Federal Acquisition

18 Streamlining Act of 1994 to contracts for the acquisition

19 of commercial items may be waived on a class basis in

20 the Federal Acquisition Regulation. Such a waiver shall

21 not apply to a provision of law that expressly refers to

22 this section and prohibits the waiver of that provision of

23 law.

24 ‘‘(b) WAIVER OF APPLICABILITY TO SUB25 CONTRACTS.—(1) The applicability of a provision of law

26 described in subsection (c) to subcontracts under a con-
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1 tract for the acquisition of commercial items or a sub2 contract for the acquisition of commercial components

3 may be waived on a class basis in the Federal Acquisition

4 Regulation. Such a waiver shall not apply to a provision

5 of law that expressly refers to this section and prohibits

6 the waiver of that provision of law.

7 ‘‘(2) Nothing in this subsection shall be construed to

8 authorize the waiver of the applicability of any provision

9 of law with respect to—

10 ‘‘(A) any contract with a prime contractor; or

11 ‘‘(B) any subcontract under a contract with a

12 prime contractor who does not substantially trans13 form the commercial items supplied under the con14 tract.

15 ‘‘(c) COVERED LAW.—A provision of law referred to

16 in subsections (a) and (b) is any provision of law that,

17 as determined by the Federal Acquisition Regulatory

18 Council, sets forth policies, procedures, requirements, or

19 restrictions for the procurement of property or services by

20 the Federal Government.’’.

21 SEC. 8005. INAPPLICABILITY OF CERTAIN PROVISIONS OF

22 LAW.

23 (a) ARMED SERVICES ACQUISITIONS.—

24 (1) PROHIBITION ON CONTINGENT FEES.—Sec25 tion 2306(b) of title 10, United States Code, as
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1 amended by section 4022(a), is further amended by

2 inserting before the period at the end of the sentence

3 added by section 4022(a) the following: ‘‘or to a con4 tract for the acquisition of commercial items’’.

5 (2) REQUIREMENT TO IDENTIFY SUPPLIERS

6 AND SOURCES OF SUPPLIES.—Paragraph (2) of sec7 tion 2384(b) of title 10, United States Code, is

8 amended to read as follows:

9 ‘‘(2) The regulations prescribed pursuant to para10 graph (1) do not apply to a contract that requires the de11 livery of supplies that are commercial items, as defined

12 in section 2302 of this title.’’.

13 (3) PROHIBITION AGAINST DOING BUSINESS

14 WITH CERTAIN OFFERORS OR CONTRACTORS.—Sec15 tion 2393(d) of title 10, United States Code, as

16 amended by section 4022(e), is further amended by

17 adding at the end the following: ‘‘The requirement

18 shall not apply in the case of a subcontract for the

19 acquisition of commercial items (as defined in sec20 tion 4(12) of the Office of Federal Procurement Pol21 icy Act (41 U.S.C. 403(12))).’’.

22 (4) PROHIBITION ON LIMITATION OF SUB23 CONTRACTOR DIRECT SALES.—Section 2402 of title

24 10, United States Code, as amended by section
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1 4022(b), is further amended by adding at the end

2 the following new subsection:

3 ‘‘(d)(1) An agreement between the contractor in a

4 contract for the acquisition of commercial items and a

5 subcontractor under such contract that restricts sales by

6 such subcontractor directly to persons other than the con7 tractor may not be considered to unreasonably restrict

8 sales by that subcontractor to the United States in viola9 tion of the provision included in such contract pursuant

10 to subsection (a) if the agreement does not result in the

11 Federal Government being treated differently with regard

12 to the restriction than any other prospective purchaser of

13 such commercial items from that subcontractor.

14 ‘‘(2) In paragraph (1), the term ‘commercial item’

15 has the meaning given such term in section 4(12) of the

16 Office of Federal Procurement Policy Act (41 U.S.C.

17 403(12)).’’.

18 (5) CONTRACTOR INVENTORY ACCOUNTING SYS19 TEMS: STANDARDS.—Section 2410b of title 10,

20 United States Code, is amended—

21 (A) by inserting ‘‘(a) REGULATIONS RE22 QUIRED.—’’ before ‘‘The Secretary of Defense’’;

23 and

24 (B) by adding at the end the following new

25 subsection:
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1 ‘‘(b) INAPPLICABILITY TO ACQUISITIONS OF COM2 MERCIAL ITEMS.—The regulations prescribed pursuant to

3 subsection (a) need not apply to a contract for the acquisi4 tion of commercial items (as defined in section 4(12) of

5 the Office of Federal Procurement Policy Act (41 U.S.C.

6 403(12))).’’.

7 (6) PROHIBITION ON PERSONS CONVICTED OF

8 DEFENSE-CONTRACT RELATED FELONIES.—Para9 graph (4) of section 2408(a) of title 10, United

10 States Code, as added by section 4022(f), is amend11 ed—

12 (A) by inserting after subparagraph (A)

13 the following:

14 ‘‘(B) A contract referred to in such subpara15 graph that is for the acquisition of commercial items

16 (as defined in section 4(12) of the Office of Federal

17 Procurement Policy Act (41 U.S.C. 403(12))).’’; and

18 (B) by inserting ‘‘or (B)’’ before the period

19 at the end of subparagraph (C).

20 (b) CIVILIAN AGENCY ACQUISITIONS.—

21 (1) RESTRICTIONS ON SUBCONTRACTOR SALES

22 TO THE UNITED STATES.—Section 303G of the Fed23 eral Property and Administrative Services Act of

24 1949 (41 U.S.C. 253g), as amended by section
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1 4023(b), is further amended by adding at the end

2 the following new subsection:

3 ‘‘(d) An agreement between the contractor in a con4 tract for the acquisition of commercial items and a sub5 contractor under such contract that restricts sales by such

6 subcontractor directly to persons other than the contractor

7 may not be considered to unreasonably restrict sales by

8 that subcontractor to the United States in violation of the

9 provision included in such contract pursuant to subsection

10 (a) if the agreement does not result in the Federal Govern11 ment being treated differently with regard to the restric12 tion than any other prospective purchaser of such commer13 cial items from that subcontractor.’’.

14 (2) PROHIBITION ON CONTINGENT FEES.—Sec15 tion 304(a) of the Federal Property and Administra16 tive Services Act of 1949 (41 U.S.C. 254(a)), as

17 amended by section 4023(a) is further amended by

18 inserting before the period at the end of the sentence

19 added by section 4041 the following: ‘‘or to a con20 tract for the acquisition of commercial items’’.

21 (c) ACQUISITIONS GENERALLY.—

22 (1) FEDERAL WATER POLLUTION CONTROL

23 ACT.—Section 508 of the Federal Water Pollution

24 Control Act (33 U.S.C. 1368) is amended by adding

25 at the end the following new subsection:
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1 ‘‘(f)(1) No certification by a contractor, and no con2 tract clause, may be required in the case of a contract

3 for the acquisition of commercial items in order to imple4 ment a prohibition or requirement of this section or a pro5 hibition or requirement issued in the implementation of

6 this section.

7 ‘‘(2) In paragraph (1), the term ‘commercial item’

8 has the meaning given such term in section 4(12) of the

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

10 403(12)).’’.

11 (2) CONTRACT WORK HOURS AND SAFETY

12 STANDARDS ACT.—The Contract Work Hours and

13 Safety Standards Act (title I of the Work Hours and

14 Safety Act of 1962 (40 U.S.C. 327 et seq.)) is

15 amended by adding at the end the following new sec16 tion:

17 ‘‘SEC. 108. (a) No certification by a contractor, and

18 no contract clause, may be required in the case of a con19 tract for the acquisition of commercial items in order to

20 implement a prohibition or requirement in this title.

21 ‘‘(b) In subsection (a), 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 (3) OFFICE OF FEDERAL PROCUREMENT POL2 ICY ACT REQUIREMENT RELATING TO PROCUREMENT

3 INTEGRITY CERTIFICATIONS.—Section 27(e)(7) of

4 the Office of Federal Procurement Policy Act (41

5 U.S.C. 423) is amended by adding at the end the

6 following new subparagraph:

7 ‘‘(C) This subsection does not apply to a contract for

8 the acquisition of commercial items.’’.

9 (4) CERTAIN PROVISIONS OF THE ANTI-KICK10 BACK ACT OF 1986.—

11 (A) REQUIREMENT FOR CONTRACT

12 CLAUSE.—Section 7 of the Anti-Kickback Act

13 of 1986 (41 U.S.C. 57), as amended by section

14 4024(b), is further amended by inserting before

15 the period at the end of subsection (d) the fol16 lowing: ‘‘or to a prime contract for the acquisi17 tion of commercial items (as defined in section

18 4(12) of such Act (41 U.S.C. 403(12))).’’.

19 (B) INSPECTION AUTHORITY.—Section 8

20 of such Act (41 U.S.C. 58) is amended by add21 ing at the end the following: ‘‘This section does

22 not apply with respect to a prime contract for

23 the acquisition of commercial items (as defined

24 in section 4(12) of the Office of Federal Pro25 curement Policy Act (41 U.S.C. 403(12))).’’.
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1 (5) DRUG-FREE WORKPLACE ACT OF 1988.—

2 Section 5152(a)(1) of the Drug-Free Workplace Act

3 of 1988 (subtitle D of title V of Public Law 100–

4 690; 41 U.S.C. 701(a)(1)), as amended by section

5 4024(e), is further amended by inserting after the

6 matter inserted by such section 4024(e) the follow7 ing: ‘‘, other than a contract for the procurement of

8 commercial items (as defined in section 4(12) of

9 such Act (41 U.S.C. 403(12))),’’.

10 (6) CLEAN AIR ACT.—Section 306 of the Clean

11 Air Act (42 U.S.C. 7606) is amended by adding at

12 the end the following new subsection:

13 ‘‘(f)(1) No certification by a contractor, and no con14 tract clause, may be required in the case of a contract

15 for the acquisition of commercial items in order to imple16 ment a prohibition or requirement of this section or a pro17 hibition or requirement issued in the implementation of

18 this section.

19 ‘‘(2) In paragraph (1), the term ‘commercial item’

20 has the meaning given such term in section 4(12) of the

21 Office of Federal Procurement Policy Act (41 U.S.C.

22 403(12)).’’.

23 (7) FLY AMERICAN REQUIREMENTS.—Section

24 1117 of the Federal Aviation Act of 1958 (49
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1 U.S.C. App. 1517) is amended by adding at the end

2 the following new subsection:

3 ‘‘(e)(1) No certification by a contractor, and no con4 tract clause, may be required in the case of a contract

5 for the transportation of commercial items in order to im6 plement a requirement in this section.

7 ‘‘(2) In paragraph (1), the term ‘commercial item’

8 has the meaning given such term in section 4(12) of the

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

10 403(12)).’’.

11 SEC. 8006. FLEXIBLE DEADLINES FOR SUBMISSION OF OF12 FERS OF COMMERCIAL ITEMS.

13 Section 18(a) of the Office of Federal Procurement

14 Policy Act (41 U.S.C. 416(a)) is amended by adding at

15 the end the following new paragraph:

16 ‘‘(4) The requirements of paragraph (3)(B) do not

17 apply to contracts for the purchase of commercial items.

18 The Administrator shall prescribe for such contracts ap19 propriate limits on the applicability of a deadline for sub20 mission of bids or proposals that is required by subsection

21 (a)(1). Such limits shall be incorporated in the Federal

22 Acquisition Regulation.’’.
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1 SEC. 8007. ADVOCATES FOR ACQUISITION OF COMMERCIAL

2 AND NONDEVELOPMENTAL ITEMS.

3 (a) RESPONSIBILITIES OF THE ADVOCATE FOR COM4 PETITION.—Section 20(c) of the Office of Federal Pro5 curement Policy Act (41 U.S.C. 418(c)) is amended to

6 read as follows:

7 ‘‘(c) The advocate for competition for each procuring

8 activity shall be responsible for promoting full and open

9 competition, promoting the acquisition of commercial

10 items and other nondevelopmental items, and challenging

11 barriers to such acquisition, including such barriers as un12 necessarily restrictive statements of need, unnecessarily

13 detailed specifications, and unnecessarily burdensome con14 tract clauses.’’.

15 (b) REPEAL OF SUPERSEDED PROVISION.—Section

16 28 of such Act (41 U.S.C. 424) is repealed.

17 SEC. 8008. PROVISIONS NOT AFFECTED.

18 Nothing in this title shall be construed as amending,

19 modifying, or superseding, or as intended to impair or re20 strict authorities or responsibilities under—

21 (1) section 111 of the Federal Property and

22 Administrative Services Act of 1949 (40 U.S.C.

23 759), popularly referred to as the ‘‘Brooks Auto24 matic Data Processing Act’’;

25 (2) title IX of the Federal Property and Admin26 istrative Services Act of 1949 (40 U.S.C. 541 et
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1 seq.), popularly referred to as the ‘‘Brooks Archi2 tect-Engineers Act’’;

3 (3) section 8(a) of the Small Business Act (15

4 U.S.C. 637(a)) or any other provision of that Act;

5 or

6 (4) the Act of June 25, 1938 (41 U.S.C. 46–

7 48c), that was revised and reenacted in the Act of

8 June 23, 1971 (85 Stat. 77), popularly referred to

9 as the ‘‘Javits-Wagner-O’Day Act’’.

10 SEC. 8009. COMPTROLLER GENERAL REVIEW OF FEDERAL

11 GOVERNMENT USE OF MARKET RESEARCH.

12 (a) REPORT REQUIRED.—Not later than 2 years

13 after the date of the enactment of this Act, the Comptrol14 ler General of the United States shall submit to the Con15 gress a report on the use of market research by the Fed16 eral Government in support of the procurement of com17 mercial items and nondevelopmental items.

18 (b) CONTENT OF REPORT.—The report shall include

19 the following:

20 (1) A review of existing Federal Government

21 market research efforts to gather data concerning

22 commercial and other nondevelopmental items.

23 (2) A review of the feasibility of creating a Gov24 ernment-wide data base for storing, retrieving, and
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1 analyzing market data, including use of existing

2 Federal Government resources.

3 (3) Any recommendations for changes in law or

4 regulations that the Comptroller General considers

5 appropriate.

6 TITLE IX—EFFECTIVE DATES

7 AND IMPLEMENTATION

8 SEC. 9001. EFFECTIVE DATES.

9 (a) EFFECTIVE DATE OF ACT.—Except as otherwise

10 provided in this Act, this Act shall take effect on the date

11 of the enactment of this Act.

12 (b) EFFECTIVE DATE OF AMENDMENTS.—Except as

13 otherwise provided in this Act, the amendments made by

14 this Act shall take effect on the date on which final imple15 menting regulations are prescribed in accordance with sec16 tion 9002.

17 SEC. 9002. IMPLEMENTING REGULATIONS.

18 (a) PROPOSED CHANGES.—Proposed changes to the

19 Federal Acquisition Regulation and such other proposed

20 regulations (or changes to existing regulations) as may be

21 necessary to implement this Act shall be published in the

22 Federal Register not later than 210 days after the date

23 of the enactment of this Act.
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1 (b) PUBLIC COMMENT.—The proposed regulations

2 described in subsection (a) shall be made available for

3 public comment for a period of not less than 60 days.

4 (c) FINAL REGULATIONS.—Final regulations shall be

5 published in the Federal Register not later than 330 days

6 after the date of enactment of this Act.

7 (d) APPLICABILITY.—(1) The amendments made by

8 this Act shall apply, in the manner prescribed in such final

9 regulations, to any solicitation that is issued or any unso10 licited proposal that is received on or after the date de11 scribed in paragraph (3).

12 (2) The amendments made by this Act shall apply,

13 to the extent and in the manner prescribed in such final

14 regulations, to any matter related to—

15 (A) a contract that is in effect on the date de16 scribed in paragraph (3);

17 (B) an offer under consideration on the date

18 described in paragraph (3); or

19 (C) any other proceeding or action that is ongo20 ing on the date described in paragraph (3).

21 (3) The date referred to in paragraphs (1) and (2)

22 is the date specified in such regulations, which—

23 (A) shall not be earlier than the end of the 30-

24 day period that begins on the date the regulations

25 required by subsection (c) are published; and
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1 (B) shall not be later than October 1, 1995.

2 (e) SAVINGS PROVISION.—Nothing in this Act shall

3 be construed to affect the validity of any action taken or

4 any contract entered into prior to the date specified in

5 the regulations pursuant to subsection (d)(3) except to the

6 extent and in the manner prescribed in such regulations.

7 SEC. 9003. EVALUATION BY THE COMPTROLLER GENERAL.

8 (a) EVALUATION RELATING TO ISSUANCE OF REGU9 LATIONS.—Not later than December 1, 1995, the Comp10 troller General shall submit to the committees referred to

11 in subsection (c) a report evaluating compliance with the

12 requirements in section 9002, relating to the issuance of

13 implementing regulations.

14 (b) EVALUATION OF IMPLEMENTATION OF REGULA15 TIONS.—Not later than December 1, 1996, the Comptrol16 ler General shall submit to the committees referred to in

17 subsection (c) a report evaluating the effectiveness of the

18 regulations implementing this Act in streamlining the ac19 quisition system and fulfilling the other purposes of this

20 Act.

21 (c) COMMITTEES DESIGNATED TO RECEIVE THE RE22 PORTS.—The Comptroller General shall submit the re23 ports required by this section to the Committees on Armed

24 Services and on Governmental Affairs of the Senate and
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1 the Committees on Small Business on Government Oper2 ations of the House of Representatives.

3 SEC. 9004. DATA COLLECTION THROUGH THE FEDERAL

4 PROCUREMENT DATA SYSTEM.

5 (a) DATA COLLECTION REQUIRED.—The Federal

6 Procurement Data System described in section 6(d)(4)(A)

7 of the Office of Federal Procurement Policy Act (41

8 U.S.C. 405(d)(4)(A)) shall be modified to collect from con9 tracts in excess of the simplified acquisition threshold data

10 pertaining to the following matters:

11 (1) Contract awards made pursuant to competi12 tions conducted pursuant to section 2323 of title 10,

13 United States Code, or section 8(c) of the Small

14 Business Act (15 U.S.C. 637(c)).

15 (2) Awards to business concerns owned and

16 controlled by women.

17 (3) Number of offers received in response to a

18 solicitation.

19 (4) Task order contracts.

20 (5) Contracts for the acquisition of commercial

21 items.

22 (b) DEFINITION.—In this section, the term ‘‘sim23 plified acquisition threshold’’ has the meaning given such

24 term in section 4 of the Office of Federal Procurement

25 Policy Act (41 U.S.C. 403).
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Calendar No. 476

103D CONGRESS

2D SESSION S. 2206

A BILL

To revise and streamline the acquisition laws of the

Federal Government, and for other purposes.

JUNE 20 (legislative day, JUNE 7), 1994

Read twice and placed on the calendar