445 
(b) CHILDREN.—Section 322 of the Immigration and 
Nationality Act (8 U.S.C. 1433) is amended by adding 
at the end the following new subsection: 
‘‘(d) In the case of a child of a member of the Armed 
Forces of the United States who is authorized to accom-
pany such member and reside abroad with the member 
pursuant to the member’s official orders, and is so accom-
panying and residing with the member— 
‘‘(1) any period of time during which the mem-
ber of the Armed Forces is residing abroad pursuant 
to official orders shall be treated, for purposes of 
subsection (a)(2)(A), as physical presence in the 
United States; 
‘‘(2) subsection (a)(5) shall not apply; and 
‘‘(3) the oath of allegiance described in sub-
section (b) may be subscribed to abroad pursuant to 
section 1701(d) of the National Defense Authoriza-
tion Act for Fiscal Year 2004 (Public Law 108–136; 
8 U.S.C. 1443a).’’. 
(c) OVERSEAS NATURALIZATION AUTHORITY.—Sec-
tion 1701(d) of the National Defense Authorization Act 
for Fiscal Year 2004 (Public Law 108–136; 8 U.S.C. 
1443a) is amended—
446 
(1) in the subsection heading, by inserting 
‘‘AND
THEIR
SPOUSES
AND
CHILDREN’’ after 
‘‘FORCES’’; and 
(2) by inserting ‘‘, and persons made eligible 
for naturalization by section 319(e) or 322(d) of 
such Act,’’ after ‘‘Armed Forces’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of enactment of 
this Act and apply to any application for naturalization 
or issuance of a certificate of citizenship pending on or 
after such date. 
SEC. 675. MODIFICATION OF AMOUNT OF BACK PAY FOR 
MEMBERS OF NAVY AND MARINE CORPS SE-
LECTED FOR PROMOTION WHILE INTERNED 
AS PRISONERS OF WAR DURING WORLD WAR 
II TO TAKE INTO ACCOUNT CHANGES IN CON-
SUMER PRICE INDEX. 
(a) MODIFICATION.—Section 667(c) of the Floyd D. 
Spence National Defense Authorization Act for Fiscal 
Year 2001 (as enacted into law by Public Law 106–398; 
114 Stat. 1654A–170) is amended by adding at the end 
the following new paragraph: 
‘‘(3) The amount determined for a person under 
paragraph (1) shall be increased to reflect increases in 
cost of living since the basic pay referred to in paragraph
447 
(1)(B) was paid to or for that person, calculated on the 
basis of the Consumer Price Index (all items—United 
States city average) published monthly by the Bureau of 
Labor Statistics.’’. 
(b) RECALCULATION OF PREVIOUS PAYMENTS.—In 
the case of any payment of back pay made to or for a 
person under section 667 of the Floyd D. Spence National 
Defense Authorization Act for Fiscal Year 2001 before the 
date of the enactment of this Act, the Secretary of the 
Navy shall— 
(1) recalculate the amount of back pay to which 
the person is entitled by reason of the amendment 
made by subsection (a); and 
(2) if the amount of back pay, as so recal-
culated, exceeds the amount of back pay so paid, pay 
the person, or the surviving spouse of the person, an 
amount equal to the excess. 
TITLE VII—HEALTH CARE 
PROVISIONS 
Subtitle A—Improvements to Military Health Benefits 
Sec. 701. One-year extension of prohibition on increases in certain health care 
costs for members of the uniformed services. 
Sec. 702. Temporary prohibition on increase in copayments under retail phar-
macy system of pharmacy benefits program. 
Sec. 703. Inclusion of TRICARE retail pharmacy program in Federal procure-
ment of pharmaceuticals. 
Sec. 704. Stipend for members of reserve components for health care for cer-
tain dependents. 
Sec. 705. Authority for expansion of persons eligible for continued health bene-
fits coverage. 
Sec. 706. Continuation of eligibility for TRICARE Standard coverage for cer-
tain members of the Selected Reserve.
448 
Sec. 707. Extension of pilot program for health care delivery. 
Sec. 708. Inclusion of mental health care in definition of health care and report 
on mental health care services. 
Subtitle B—Studies and Reports 
Sec. 711. Surveys on continued viability of TRICARE Standard and TRICARE 
Extra. 
Sec. 712. Report on training in preservation of remains under combat or com-
bat-related conditions. 
Sec. 713. Report on patient satisfaction surveys. 
Sec. 714. Report on medical physical examinations of members of the Armed 
Forces before their deployment. 
Sec. 715. Report and study on multiple vaccinations of members of the Armed 
Forces. 
Sec. 716. Review of gender- and ethnic group-specific mental health services 
and treatment for members of the Armed Forces. 
Sec. 717. Licensed mental health counselors and the TRICARE program. 
Sec. 718. Report on funding of the Department of Defense for health care. 
Subtitle C—Other Matters 
Sec. 721. Prohibition on conversion of military medical and dental positions to 
civilian medical and dental positions. 
Sec. 722. Establishment of Joint Pathology Center. 
Subtitle A—Improvements to 
Military Health Benefits 
SEC. 701. ONE-YEAR EXTENSION OF PROHIBITION ON IN-
CREASES IN CERTAIN HEALTH CARE COSTS 
FOR MEMBERS OF THE UNIFORMED SERV-
ICES. 
(a) CHARGES UNDER CONTRACTS
FOR MEDICAL 
CARE.—Section 1097(e) of title 10, United States Code, 
is amended by striking ‘‘September 30, 2007’’ and insert-
ing ‘‘September 30, 2008’’. 
(b) CHARGES
FOR
INPATIENT
CARE.—Section 
1086(b)(3) of such title is amended by striking ‘‘Sep-
tember 30, 2007.’’ and inserting ‘‘September 30, 2008’’.
449 
(c) PREMIUMS UNDER TRICARE COVERAGE FOR 
CERTAIN MEMBERS IN THE SELECTED RESERVE.—Sec-
tion 1076d(d)(3) of such title is amended by striking 
‘‘September 30, 2007’’ and inserting ‘‘September 30, 
2008’’. 
SEC. 702. TEMPORARY PROHIBITION ON INCREASE IN CO-
PAYMENTS UNDER RETAIL PHARMACY SYS-
TEM OF PHARMACY BENEFITS PROGRAM. 
During the period beginning on October 1, 2007, and 
ending on September 30, 2008, the cost sharing require-
ments established under paragraph (6) of section 
1074g(a) of title 10, United States Code, for pharma-
ceutical agents available through retail pharmacies cov-
ered by paragraph (2)(E)(ii) of such section may not ex-
ceed amounts as follows: 
(1) In the case of generic agents, $3. 
(2) In the case of formulary agents, $9. 
(3) In the case of nonformulary agents, $22. 
SEC. 703. INCLUSION OF TRICARE RETAIL PHARMACY PRO-
GRAM IN FEDERAL PROCUREMENT OF PHAR-
MACEUTICALS. 
(a) IN GENERAL.—Section 1074g of title 10, United 
States Code, is amended— 
(1) by redesignating subsections (f) and (g) as 
subsections (g) and (h), respectively; and
450 
(2) by inserting after subsection (e) the fol-
lowing new subsection (f): 
‘‘(f) PROCUREMENT
OF
PHARMACEUTICALS
BY 
TRICARE RETAIL PHARMACY PROGRAM.—With respect 
to any prescription filled on or after the date of the enact-
ment of the National Defense Authorization Act for Fiscal 
Year 2008, the TRICARE retail pharmacy program shall 
be treated as an element of the Department of Defense 
for purposes of the procurement of drugs by Federal agen-
cies under section 8126 of title 38 to the extent necessary 
to ensure that pharmaceuticals paid for by the Depart-
ment of Defense that are provided by pharmacies under 
the program to eligible covered beneficiaries under this 
section are subject to the pricing standards in such section 
8126.’’. 
(b) REGULATIONS.—The Secretary of Defense shall, 
after consultation with the other administering Secretaries 
under chapter 55 of title 10, United States Code, modify 
the regulations under subsection (h) of section 1074g of 
title 10, United States Code (as redesignated by sub-
section (a)(1) of this section), to implement the require-
ments of subsection (f) of section 1074g of title 10, United 
States Code (as amended by subsection (a)(2) of this sec-
tion). The Secretary shall so modify such regulations not 
later than December 31, 2007.
451 
SEC. 704. STIPEND FOR MEMBERS OF RESERVE COMPO-
NENTS FOR HEALTH CARE FOR CERTAIN DE-
PENDENTS. 
The Secretary of Defense may, pursuant to regula-
tions prescribed by the Secretary, pay a stipend to a mem-
ber of a reserve component of the Armed Forces who is 
called or ordered to active duty for a period of more than 
30 days for purposes of maintaining civilian health care 
coverage for a dependant whom the Secretary determines 
to possess a special health care need that would be best 
met by remaining in the member’s civilian health plan. In 
making such determination, the Secretary shall consider 
whether— 
(1) the dependent of the member was receiving 
treatment for the special health care need before the 
call or order to active duty of the member; and 
(2) the call or order to active duty would result 
in an interruption in treatment or a change in 
health care provider for such treatment. 
SEC. 705. AUTHORITY FOR EXPANSION OF PERSONS ELIGI-
BLE FOR CONTINUED HEALTH BENEFITS 
COVERAGE. 
(a) AUTHORITY TO SPECIFY ADDITIONAL ELIGIBLE 
PERSONS.—Subsection (b) of section 1078a of title 10, 
United States Code, is amended by adding at the end the 
following new paragraph:
452 
‘‘(4) Any other person specified in regulations 
prescribed by the Secretary of Defense for purposes 
of this paragraph who loses entitlement to health 
care services under this chapter or section 1145 of 
this title, subject to such terms and conditions as 
the Secretary shall prescribe in the regulations.’’. 
(b) ELECTION
OF COVERAGE.—Subsection (d) of 
such section is amended by adding at the end the following 
new paragraph: 
‘‘(4) In the case of a person described in sub-
section (b)(4), by such date as the Secretary shall 
prescribe in the regulations required for purposes of 
that subsection.’’. 
(c) PERIOD
OF COVERAGE.—Subsection (g)(1) of 
such section is amended— 
(1) in subparagraph (B), by striking ‘‘and’’ at 
the end; 
(2) in subparagraph (C), by striking the period 
at the end and inserting ‘‘; and’’; and 
(3) by adding at the end the following new sub-
paragraph: 
‘‘(D) in the case of a person described in sub-
section (b)(4), the date that is 36 months after the 
date on which the person loses entitlement to health 
care services as described in that subsection.’’.
453 
SEC. 706. CONTINUATION OF ELIGIBILITY FOR TRICARE 
STANDARD COVERAGE FOR CERTAIN MEM-
BERS OF THE SELECTED RESERVE. 
(a) IN GENERAL.—Section 706(f) of the John War-
ner National Defense Authorization Act for Fiscal Year 
2007 (Public Law 109–364; 120 Stat. 2282; 10 U.S.C. 
1076d note) is amended— 
(1) by striking ‘‘Enrollments’’ and inserting 
‘‘(1) Except as provided in paragraph (2), enroll-
ments’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(2) The enrollment of a member in TRICARE 
Standard that is in effect on the day before health care 
under TRICARE Standard is provided pursuant to the ef-
fective date in subsection (g) shall not be terminated by 
operation of the exclusion of eligibility under subsection 
(a)(2) of such section 1076d, as so amended, for the dura-
tion of the eligibility of the member under TRICARE 
Standard as in effect on October 16, 2006.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall take effect on October 1, 2007. 
SEC. 707. EXTENSION OF PILOT PROGRAM FOR HEALTH 
CARE DELIVERY. 
(a) EXTENSION
OF DURATION
OF PILOT PRO-
GRAM.—Section 721(e) of the Ronald W. Reagan National
454 
Defense Authorization Act for Fiscal Year 2005 (Public 
Law 108–375; 118 Stat. 1988; 10 U.S.C. 1092 note) is 
amended by striking ‘‘and 2007’’ and inserting ‘‘, 2007, 
2008, 2009, and 2010’’. 
(b) EXTENSION
OF REPORT DEADLINE.—Section 
721(f) of such Act is amended by striking ‘‘July 1, 2007’’ 
and inserting ‘‘July 1, 2010’’. 
(c) REVISION
IN SELECTION CRITERIA.—Section 
721(d)(2) of such Act is amended by striking ‘‘expected 
to increase over the next five years’’ and inserting ‘‘has 
increased over the five years preceding 2008’’. 
(d) ADDITION TO REQUIREMENTS OF PILOT PRO-
GRAM.—Section 721(b) of such Act is amended— 
(1) by striking ‘‘and’’ at the end of paragraph 
(3); 
(2) by striking the period and inserting ‘‘; and’’ 
at the end of paragraph (4); and 
(3) by adding at the end the following: 
‘‘(5) collaborate with State and local authorities 
to create an arrangement to share and exchange, be-
tween the Department of Defense and non-military 
health care systems, personal health information and 
data of military personnel and their families.’’.
455 
SEC. 708. INCLUSION OF MENTAL HEALTH CARE IN DEFINI-
TION OF HEALTH CARE AND REPORT ON 
MENTAL HEALTH CARE SERVICES. 
(a) INCLUSION OF MENTAL HEALTH CARE IN DEFI-
NITION OF HEALTH CARE.—Section 1072 of title 10, 
United States Code, is amended by adding at the end the 
following new paragraph: 
‘‘(10) The term ‘health care’ includes mental 
health care.’’. 
(b) REPORT ON ACCESS TO MENTAL HEALTH CARE 
SERVICES.—Not later than one year after the date of the 
enactment of this Act, the Secretary of Defense shall sub-
mit to the Committees on Armed Services of the Senate 
and the House of Representatives a report on the ade-
quacy of access to mental health services under the 
TRICARE program, including in the geographic areas 
where surveys on the continued viability of TRICARE 
Standard and TRICARE Extra are conducted under sec-
tion 711 of this Act. 
Subtitle B—Studies and Reports 
SEC. 711. SURVEYS ON CONTINUED VIABILITY OF TRICARE 
STANDARD AND TRICARE EXTRA. 
(a) REQUIREMENT FOR SURVEYS.— 
(1) IN
GENERAL.—The Secretary of Defense 
shall conduct surveys of health care providers and 
beneficiaries who use TRICARE in the United
456 
States to determine, utilizing a reconciliation of the 
responses of providers and beneficiaries to such sur-
veys, each of the following: 
(A) How many health care providers in 
TRICARE Prime service areas selected under 
paragraph (3)(A) are accepting new patients 
under each 
of 
TRICARE 
Standard 
and 
TRICARE Extra. 
(B) How many health care providers in ge-
ographic areas in which TRICARE Prime is not 
offered are accepting patients under each of 
TRICARE Standard and TRICARE Extra. 
(C) The availability of mental health care 
providers in TRICARE Prime service areas se-
lected under paragraph (3)(C) and in geo-
graphic areas in which TRICARE Prime is not 
offered. 
(2) BENCHMARKS.—The Secretary shall estab-
lish for purposes of the surveys required by para-
graph (1) benchmarks for primary care and specialty 
care providers, including mental health care pro-
viders, to be utilized to determine the adequacy of 
the availability of health care providers to bene-
ficiaries eligible for TRICARE.
457 
(3) SCOPE OF SURVEYS.—The Secretary shall 
carry out the surveys required by paragraph (1) as 
follows: 
(A) In the case of the surveys required by 
subparagraph (A) of that paragraph, in at least 
20 TRICARE Prime service areas in the 
United States in each of fiscal years 2008 
through 2011. 
(B) In the case of the surveys required by 
subparagraph (B) of that paragraph, in 20 geo-
graphic areas in which TRICARE Prime is not 
offered and in which significant numbers of 
beneficiaries who are members of the Selected 
Reserve reside. 
(C) In the case of the surveys required by 
subparagraph (C) of that paragraph, in at least 
40 geographic areas. 
(4) PRIORITY
FOR
SURVEYS.—In prioritizing 
the areas which are to be surveyed under paragraph 
(1), the Secretary shall— 
(A) 
consult 
with 
representatives 
of 
TRICARE beneficiaries and health care and 
mental health care providers to identify loca-
tions where TRICARE Standard beneficiaries 
are experiencing significant levels of access-to-
458 
care problems under TRICARE Standard or 
TRICARE Extra; 
(B) give a high priority to surveying health 
care and mental health care providers in such 
areas; and 
(C) give a high priority to surveying bene-
ficiaries and providers located in geographic 
areas with high concentrations of members of 
the Selected Reserve. 
(5) INFORMATION FROM PROVIDERS.—The sur-
veys required by paragraph (1) shall include ques-
tions seeking to determine from health care and 
mental health care providers the following: 
(A) Whether the provider is aware of the 
TRICARE program. 
(B) What percentage of the provider’s cur-
rent patient population uses any form of 
TRICARE. 
(C) Whether the provider accepts patients 
for whom payment is made under the medicare 
program for health care and mental health care 
services. 
(D) If the provider accepts patients re-
ferred to in subparagraph (C), whether the pro-
vider would accept additional such patients who
459 
are not in the provider’s current patient popu-
lation. 
(6) INFORMATION FROM BENEFICIARIES.—The 
surveys required by paragraph (1) shall include 
questions seeking information to determine from 
TRICARE beneficiaries whether they have difficul-
ties in finding health care and mental health care 
providers 
willing 
to 
provide 
services 
under 
TRICARE Standard or TRICARE Extra. 
(b) GAO REVIEW.— 
(1) ONGOING REVIEW.—The Comptroller Gen-
eral shall, on an ongoing basis, review— 
(A) the processes, procedures, and analysis 
used by the Department of Defense to deter-
mine the adequacy of the number of health care 
and mental health care providers— 
(i) that currently accept TRICARE 
Standard or TRICARE Extra beneficiaries 
as patients under TRICARE Standard in 
each TRICARE area as of the date of 
completion of the review; and 
(ii) that would accept TRICARE 
Standard or TRICARE Extra beneficiaries 
as new patients under TRICARE Standard 
or TRICARE Extra, as applicable, within
460 
a reasonable time after the date of comple-
tion of the review; and 
(B) the actions taken by the Department 
of Defense to ensure ready access of TRICARE 
Standard beneficiaries to health care and men-
tal health care under TRICARE Standard in 
each TRICARE area, including any pending or 
resolved requests for waiver of payment limits 
in order to improve access to health care or 
mental health care in a specific geographic 
area. 
(2) REPORTS.—The Comptroller General shall 
submit to the Committees on Armed Services of the 
Senate and the House of Representatives on a bi-an-
nual basis a report on the results of the review 
under paragraph (1). Each report shall include the 
following: 
(A) An analysis of the adequacy of the sur-
veys under subsection (a). 
(B) An identification of any impediments 
to achieving adequacy of availability of health 
care and mental health care under TRICARE 
Standard or TRICARE Extra. 
(C) An assessment of the adequacy of De-
partment of Defense education programs to in-
461 
form health care and mental health care pro-
viders 
about 
TRICARE 
Standard 
and 
TRICARE Extra. 
(D) An assessment of the adequacy of De-
partment of Defense initiatives to encourage 
health care and mental health care providers to 
accept patients under TRICARE Standard and 
TRICARE Extra. 
(E) An assessment of the adequacy of in-
formation available to TRICARE Standard 
beneficiaries to facilitate access by such bene-
ficiaries to health care and mental health care 
under TRICARE Standard and TRICARE 
Extra. 
(F) An assessment of any need for adjust-
ment of health care and mental health care pro-
vider payment rates to attract participation in 
TRICARE Standard by appropriate numbers of 
health care and mental health care providers. 
(G) An assessment of the adequacy of De-
partment of Defense programs to inform mem-
bers of the Selected Reserve about the 
TRICARE Reserve Select program.
462 
(H) An assessment of the ability of 
TRICARE Reserve Select beneficiaries to re-
ceive care in their geographic area. 
(c) EFFECTIVE DATE.—This section shall take effect 
on October 1, 2007. 
(d) REPEAL OF SUPERSEDED REQUIREMENTS AND 
AUTHORITY.—Section 723 of the National Defense Au-
thorization Act for Fiscal Year 2004 (10 U.S.C. 1073 
note) is repealed, effective as of October 1, 2007. 
(e) DEFINITIONS.—In this section: 
(1) The term ‘‘TRICARE Extra’’ means the 
option of the TRICARE program under which 
TRICARE Standard beneficiaries may obtain dis-
counts on cost-sharing as a result of using 
TRICARE network providers. 
(2) The term ‘‘TRICARE Prime’’ means the 
managed care option of the TRICARE program. 
(3) The term ‘‘TRICARE Prime service area’’ 
means a geographic area designated by the Depart-
ment of Defense in which managed care support 
contractors develop a managed care network under 
TRICARE Prime. 
(4) The term ‘‘TRICARE Standard’’ means the 
option of the TRICARE program that is also known 
as the Civilian Health and Medical Program of the
463 
Uniformed Services, as defined in section 1072(4) of 
title 10, United States Code. 
(5) The term ‘‘TRICARE Reserve Select’’ 
means the option of the TRICARE program that al-
lows members of the Selected Reserve to enroll in 
TRICARE Standard, pursuant to section 1076d of 
title 10, United States Code. 
(6) The term ‘‘member of the Selected Reserve’’ 
means a member of the Selected Reserve of the 
Ready Reserve of a reserve component of the Armed 
Forces. 
(7) The term ‘‘United States’’ means the 
United States (as defined in section 101(a) of title 
10, United States Code), its possessions (as defined 
in such section), and the Commonwealth of Puerto 
Rico. 
SEC. 712. REPORT ON TRAINING IN PRESERVATION OF RE-
MAINS 
UNDER 
COMBAT 
OR 
COMBAT-RE-
LATED CONDITIONS. 
(a) REPORT REQUIRED.—The Secretary of Defense 
shall submit to the Committees on Armed Services of the 
Senate and the House of Representatives a report on the 
requirements of section 567 of the John Warner National 
Defense Authorization Act for Fiscal Year 2007 (Public 
Law 109–364; 120 Stat. 2224; 10 U.S.C. 1481 note).
464 
(b) MATTERS COVERED.—The report shall include a 
detailed description of the implementation of such section, 
including— 
(1) where the training program is taking place; 
(2) who is providing the training; 
(3) the number of each type of military health 
care professional trained to date; and 
(4) what the training covers. 
(c) DEADLINE.—The report required by this section 
shall be submitted not later than 180 days after the date 
of the enactment of this Act. 
SEC. 713. REPORT ON PATIENT SATISFACTION SURVEYS. 
(a) REPORT REQUIRED.—Not later than March 1, 
2008, the Secretary of Defense shall submit to the con-
gressional defense committees a report on the ongoing pa-
tient satisfaction surveys taking place in Department of 
Defense inpatient and outpatient settings at military 
treatment facilities. 
(b) CONTENT.—The report required under subsection 
(a) shall include the following: 
(1) The types of survey questions asked. 
(2) How frequently the surveying is conducted. 
(3) How often the results are analyzed and re-
ported back to the treatment facilities. 
(4) To whom survey feedback is made available.
465 
(5) How best practices are incorporated for 
quality improvement. 
(6) An analysis of the effect of inpatient and 
outpatient surveys on quality improvement and a 
comparison of patient satisfaction survey programs 
with patient satisfaction survey programs used by 
other public and private health care systems and or-
ganizations. 
(c) USE OF REPORT INFORMATION.—The Secretary 
shall use information in the report as the basis for a plan 
for improvements in patient satisfaction surveys used to 
assess health care at military treatment facilities in order 
to ensure the provision of high quality health care and 
hospital services in such facilities. 
SEC. 714. REPORT ON MEDICAL PHYSICAL EXAMINATIONS 
OF MEMBERS OF THE ARMED FORCES BE-
FORE THEIR DEPLOYMENT. 
Not later than April 1, 2008, the Secretary of De-
fense shall submit to the Committees on Armed Services 
of the Senate and the House of Representatives a report 
setting forth the following: 
(1) A comparison of the policies of the military 
departments concerning medical physical examina-
tions of members of the Armed Forces before their 
deployment, including an identification of instances
466 
in which a member (including a member of a reserve 
component) may be required to undergo multiple 
physical examinations, from the time of notification 
of an upcoming deployment through the period of 
preparation for deployment. 
(2) An assessment of the current policies re-
lated to, as well as the feasibility of, each of the fol-
lowing: 
(A) A single predeployment physical exam-
ination for members of the Armed Forces be-
fore their deployment. 
(B) A single system for tracking electroni-
cally the results of examinations under subpara-
graph (A) that can be shared among the mili-
tary departments and thereby eliminate redun-
dancy of medical physical examinations for 
members of the Armed Forces before their de-
ployment. 
SEC. 715. REPORT AND STUDY ON MULTIPLE VACCINA-
TIONS OF MEMBERS OF THE ARMED FORCES. 
(a) REPORT REQUIRED.—Not later than 90 days 
after the date of the enactment of this Act, the Secretary 
of Defense shall submit to the Committees on Armed Serv-
ices of the Senate and the House of Representatives a re-
port on the policies of the Department of Defense for ad-
467 
ministering and evaluating the vaccination of members of 
the Armed Forces. 
(b) ELEMENTS.—The report required by subsection 
(a) shall include the following: 
(1) An assessment of the Department’s policies 
governing the administration of multiple vaccina-
tions in a 24-hour period, including the procedures 
providing for a full review of an individual’s medical 
history prior to the administration of multiple vac-
cinations, and whether such policies and procedures 
differ for members of the Armed Forces on active 
duty and members of reserve components. 
(2) An assessment of how the Department’s 
policies on multiple vaccinations in a 24-hour period 
conform to current regulations of the Food and 
Drug Administration and research performed or 
being performed by the Centers for Disease Control, 
other non-military Federal agencies, and non-Fed-
eral institutions on multiple vaccinations in a 24- 
hour period. 
(3) An assessment of the Department’s proce-
dures for initiating investigations of deaths of mem-
bers of the Armed Forces in which vaccinations may 
have played a role, including whether such investiga-
468 
tions can be requested by family members of the de-
ceased individuals. 
(4) The number of deaths of members of the 
Armed Forces since May 18, 1998, that the Depart-
ment has investigated for the potential role of vac-
cine administration, including both the number of 
deaths investigated that was alleged to have involved 
more than one vaccine administered in a given 24- 
hour period and the number of deaths investigated 
that was determined to have involved more than one 
vaccine administered in a given 24-hour period. 
(5) An assessment of the procedures for pro-
viding the Adjutants General of the various States 
and territories with up-to-date information on the ef-
fectiveness and potential allergic reactions and side 
effects of vaccines required to be taken by National 
Guard members. 
(6) An assessment of whether procedures are in 
place to provide that the Adjutants General of the 
various States and territories retain updated medical 
records of each National Guard member called up 
for active duty.
470 
the Armed Forces who experienced sexual assault or 
abuse. 
(4) The access to and need for treatment facili-
ties focusing on the gender- and ethnic group-spe-
cific mental health care needs of members of the 
Armed Forces. 
(5) The need for further clinical research on the 
gender- and ethnic group-specific needs of members 
of the Armed Forces who served in a combat zone. 
(c) REPORT.—Not later than 90 days after the date 
of the enactment of this Act, the Secretary of Defense 
shall submit to the congressional defense committees a re-
port on the review required by subsection (a). 
SEC. 717. LICENSED MENTAL HEALTH COUNSELORS AND 
THE TRICARE PROGRAM. 
(a) REGULATIONS.—The Secretary of Defense shall 
prescribe regulations to establish criteria that licensed or 
certified mental health counselors shall meet in order to 
be able to independently provide care to TRICARE bene-
ficiaries and receive payment under the TRICARE pro-
gram for such services. The criteria shall include require-
ments for education level, licensure, certification, and clin-
ical experience as considered appropriate by the Secretary. 
(b) STUDY REQUIRED.—The Secretary of Defense 
shall enter into a contract with the Institute of Medicine
471 
of the National Academy of Sciences, or another similarly 
qualified independent academic medical organization, for 
the purpose of— 
(1) conducting an independent study of the cre-
dentials, preparation, and training of individuals 
practicing as licensed mental health counselors; and 
(2) making recommendations for permitting li-
censed mental health counselors to practice inde-
pendently under the TRICARE program. 
(c) ELEMENTS OF STUDY.— 
(1) EDUCATIONAL REQUIREMENTS.—The study 
required by subsection (b) shall provide for an as-
sessment of the educational requirements and cur-
ricula relevant to mental health practice for licensed 
mental health counselors, including types of degrees 
recognized, certification standards for graduate pro-
grams for such profession, and recognition of under-
graduate coursework for completion of graduate de-
gree requirements. 
(2) LICENSING REQUIREMENTS.—The study re-
quired by subsection (b) shall provide for an assess-
ment of State licensing requirements for licensed 
mental health counselors, including for each level of 
licensure if a State issues more than one type of li-
cense for the profession. The assessment shall exam-
472 
ine requirements in the areas of education, training, 
examination, continuing education, and ethical 
standards, and shall include an evaluation of the ex-
tent to which States authorize members of the li-
censed mental health counselor profession to diag-
nose and treat mental illnesses. 
(3) CLINICAL EXPERIENCE REQUIREMENTS.— 
The study required by subsection (b) shall provide 
for an analysis of the requirements for clinical expe-
rience for a licensed mental health counselor to be 
recognized under regulations for the TRICARE pro-
gram, and recommendations, if any, for standardiza-
tion or adjustment of such requirements. 
(4) INDEPENDENT
PRACTICE
UNDER
OTHER 
FEDERAL PROGRAMS.—The study required by sub-
section (b) shall provide for an assessment of the ex-
tent to which licensed mental health counselors are 
authorized to practice independently under other 
Federal programs (such as the Medicare program, 
the Department of Veterans Affairs, the Indian 
Health Service, and Head Start), and a review of 
the relationship, if any, between recognition of men-
tal health professions under the Medicare program 
and independent practice authority for such profes-
sion under the TRICARE program.
473 
(5) INDEPENDENT PRACTICE UNDER FEHBP.— 
The study required by subsection (b) shall provide 
for an assessment of the extent to which licensed 
mental health counselors are authorized to practice 
independently under the Federal Employee Health 
Benefits Program and private insurance plans. The 
assessment shall identify the States having laws re-
quiring private insurers to cover, or offer coverage 
of, the services of members of licensed mental health 
counselors and shall identify the conditions, if any, 
that are placed on coverage of practitioners under 
the profession by insurance plans and how fre-
quently these types of conditions are used by insur-
ers. 
(6) HISTORICAL REVIEW OF REGULATIONS.— 
The study required by subsection (b) shall provide 
for a review of the history of regulations prescribed 
by the Department of Defense regarding which 
members of the mental health profession are recog-
nized as providers under the TRICARE program as 
independent practitioners, and an examination of the 
recognition by the Department of third-party certifi-
cation for members of such profession. 
(7) CLINICAL
CAPABILITIES
STUDIES.—The 
study required by subsection (b) shall include a re-
474 
view of outcome studies and of the literature regard-
ing the comparative quality and effectiveness of care 
provided by licensed mental health counselors and 
provide an independent review of the findings. 
(d) RECOMMENDATIONS
FOR
TRICARE INDE-
PENDENT PRACTICE AUTHORITY.—The recommendations 
provided under subsection (b)(2) shall include rec-
ommendations regarding modifications of current policy 
for the TRICARE program with respect to allowing li-
censed mental health counselors to practice independently 
under the TRICARE program. 
(e) REPORT.—Not later than March 1, 2009, the 
Secretary of Defense shall submit to the Committees on 
Armed Services of the Senate and the House of Represent-
atives a report on the review required by subsection (b). 
SEC. 718. REPORT ON FUNDING OF THE DEPARTMENT OF 
DEFENSE FOR HEALTH CARE. 
(a) REPORT.—If the President submits to Congress 
the budget for a fiscal year under section 1105 of title 
31, United States Code, and the aggregate amount in-
cluded in that budget for the Department of Defense for 
health care for such fiscal year is less than the aggregate 
amount provided by Congress for the Department for 
health care for the preceding fiscal year, and, in the case 
of the Department, the total allocation from the Defense
475 
Health Program to any military department is less than 
the total of such allocation in the preceding fiscal year, 
the President shall submit to Congress a report on— 
(1) the reasons for the determination that in-
clusion of a lesser aggregate amount or allocation to 
any military department is in the national interest; 
and 
(2) the anticipated effects of the inclusion of 
such lesser aggregate amount or allocation to any 
military department on the access to and delivery of 
medical and support services to members of the 
Armed Forces and their family members. 
(b) TERMINATION.—The section shall not be in effect 
after December 31, 2017. 
Subtitle C—Other Matters 
SEC. 721. PROHIBITION ON CONVERSION OF MILITARY 
MEDICAL AND DENTAL POSITIONS TO CIVIL-
IAN MEDICAL AND DENTAL POSITIONS. 
(a) PROHIBITION.—The Secretary of a military de-
partment may not convert any military medical or dental 
position to a civilian medical or dental position during the 
period beginning on October 1, 2007, and ending on Sep-
tember 30, 2012. 
(b) RESTORATION OF CERTAIN POSITIONS TO MILI-
TARY POSITIONS.—In the case of any military medical or
476 
dental position that is converted to a civilian medical or 
dental position during the period beginning on October 1, 
2004, and ending on September 30, 2008, if the position 
is not filled by a civilian by September 30, 2008, the Sec-
retary of the military department concerned shall restore 
the position to a military medical or dental position that 
can be filled only by a member of the Armed Forces who 
is a health professional. 
(c) REPORT.— 
(1) REQUIREMENT.—The Secretary of Defense 
shall submit to the congressional defense committees 
a report on conversions made during fiscal year 
2007 not later than 180 days after the enactment of 
this Act. 
(2) MATTERS COVERED.—The report shall in-
clude the following: 
(A) The number of military medical or 
dental positions, by grade or band and spe-
cialty, converted to civilian medical or dental 
positions. 
(B) The results of a market survey in each 
affected area of the availability of civilian med-
ical and dental care providers in such area in 
order to determine whether there were civilian 
medical and dental care providers available in
477 
such area adequate to fill the civilian positions 
created by the conversion of military medical 
and dental positions to civilian positions in such 
area. 
(C) An analysis, by affected area, showing 
the extent to which access to health care and 
cost of health care was affected in both the di-
rect care and purchased care systems, including 
an assessment of the effect of any increased 
shifts in patient load from the direct care to the 
purchased care system, or any delays in receipt 
of care in either the direct or purchased care 
system because of the conversions. 
(D) The extent to which military medical 
and dental positions converted to civilian med-
ical or dental positions affected recruiting and 
retention of uniformed medical and dental per-
sonnel. 
(E) A comparison of the full costs for the 
military medical and dental positions converted 
with the full costs for civilian medical and den-
tal positions, including expenses such as re-
cruiting, salary, benefits, training, and any 
other costs the Department identifies.
478 
(F) An assessment showing that the mili-
tary medical or dental positions converted were 
in excess of the military medical and dental po-
sitions needed to meet medical and dental read-
iness requirements of the uniformed services, as 
determined jointly by all the uniformed services. 
(d) DEFINITIONS.—In this section: 
(1) The term ‘‘military medical or dental posi-
tion’’ means a position for the performance of health 
care functions within the Armed Forces held by a 
member of the Armed Forces. 
(2) The term ‘‘civilian medical or dental posi-
tion’’ means a position for the performance of health 
care functions within the Department of Defense 
held by an employee of the Department or of a con-
tractor of the Department. 
(3) The term ‘‘uniformed services’’ has the 
meaning given that term in section 1072(1) of title 
10, United States Code. 
(4) The term ‘‘conversion’’, with respect to a 
military medical or dental position, means a change 
of the position to a civilian medical or dental posi-
tion, effective as of the date of the manning author-
ization document of the military department making 
the change (through a change in designation from
479 
military to civilian in the document, the elimination 
of the listing of the position as a military position 
in the document, or through any other means indi-
cating the change in the document or otherwise). 
(e) REPEAL.—Section 742 of the John Warner Na-
tional Defense Authorization Act for Fiscal Year 2007 
(Public Law 109–364; 120 Stat. 2306) is repealed. 
SEC. 722. ESTABLISHMENT OF JOINT PATHOLOGY CENTER. 
(a) FINDINGS.—Congress makes the following find-
ings: 
(1) The Secretary of Defense proposed to dis-
establish all elements of the Armed Forces Institute 
of Pathology, except the National Medical Museum 
and the Tissue Repository, as part of the rec-
ommendations of the Secretary for the closure of 
Walter Reed Army Medical Center in the 2005 
round of defense base closure and realignment. 
(2) The Defense Base Closure and Realignment 
Commission altered, but did not reject, the proposal 
of the Secretary of Defense to disestablish the 
Armed Forces Institute of Pathology. 
(3) The Commission’s recommendation that the 
Armed Forces Institute of Pathology’s ‘‘capabilities 
not specified in this recommendation will be ab-
sorbed into other DOD, Federal, or civilian facili-
480 
ties’’ provides the flexibility to retain a Joint Pathol-
ogy Center as a Department of Defense or Federal 
entity. 
(b) SENSE OF CONGRESS.—It is the sense of Con-
gress that the Armed Forces Institute of Pathology has 
provided important medical benefits to the Armed Forces 
and to the United States and that the Federal Govern-
ment should retain a Joint Pathology Center. 
(c) ESTABLISHMENT.— 
(1) ESTABLISHMENT
REQUIRED.—The Presi-
dent shall establish and maintain a Joint Pathology 
Center that shall function as the reference center in 
pathology for the Federal Government. 
(2) ESTABLISHMENT WITHIN DOD.—Except as 
provided in paragraph (3), the Joint Pathology Cen-
ter shall be established in the Department of De-
fense, consistent with the final recommendations of 
the 2005 Defense Base Closure and Realignment 
Commission, as approved by the President. 
(3) ESTABLISHMENT
IN
ANOTHER
DEPART-
MENT.—If the President makes a determination, 
within 180 days after the date of the enactment of 
this Act, that the Joint Pathology Center cannot be 
established in the Department of Defense, the Joint 
Pathology Center shall be established as an element
481 
of a Federal agency other than the Department of 
Defense. The President shall incorporate the selec-
tion of such agency into the determination made 
under this paragraph. 
(d) SERVICES.—The Joint Pathology Center shall 
provide, at a minimum, the following: 
(1) Diagnostic pathology consultation services 
in medicine, dentistry, and veterinary sciences. 
(2) Pathology education, to include graduate 
medical education, including residency and fellow-
ship programs, and continuing medical education. 
(3) Diagnostic pathology research. 
(4) Maintenance and continued modernization 
of the Tissue Repository and, as appropriate, utiliza-
tion of the Repository in conducting the activities 
described in paragraphs (1) through (3). 
TITLE VIII—ACQUISITION POL-
ICY, ACQUISITION MANAGE-
MENT, AND RELATED MAT-
TERS 
Sec. 800. Short title. 
Subtitle A—Acquisition Policy and Management 
Sec. 801. Internal controls for procurements on behalf of the Department of 
Defense by certain non-Defense agencies. 
Sec. 802. Lead systems integrators. 
Sec. 803. Reinvestment in domestic sources of strategic materials. 
Sec. 804. Clarification of the protection of strategic materials critical to na-
tional security. 
Sec. 805. Procurement of commercial services.
482 
Sec. 806. Specification of amounts requested for procurement of contract serv-
ices. 
Sec. 807. Inventories and reviews of contracts for services. 
Sec. 808. Independent management reviews of contracts for services. 
Sec. 809. Implementation and enforcement of requirements applicable to 
undefinitized contractual actions. 
Sec. 810. Clarification of limited acquisition authority for Special Operations 
Command. 
Subtitle B—Provisions Relating to Major Defense Acquisition Programs 
Sec. 811. Requirements applicable to multiyear contracts for the procurement 
of major systems of the Department of Defense. 
Sec. 812. Changes to Milestone B certifications. 
Sec. 813. Comptroller General report on Department of Defense organization 
and structure for major defense acquisition programs. 
Sec. 814. Clarification of submission of cost or pricing data on noncommercial 
modifications of commercial items. 
Sec. 815. Clarification of rules regarding the procurement of commercial items. 
Sec. 816. Review of systemic deficiencies on major defense acquisition pro-
grams. 
Sec. 817. Investment strategy for major defense acquisition programs. 
Sec. 818. Report on implementation of recommendations on total ownership 
cost for major weapon systems. 
Subtitle C—Amendments to General Contracting Authorities, Procedures, and 
Limitations 
Sec. 821. Plan for restricting Government-unique contract clauses on commer-
cial contracts. 
Sec. 822. Extension of authority for use of simplified acquisition procedures for 
certain commercial items. 
Sec. 823. Five-year extension of authority to carry out certain prototype 
projects. 
Sec. 824. Exemption of Special Operations Command from certain require-
ments for certain contracts relating to vessels, aircraft, and 
combat vehicles. 
Sec. 825. Provision of authority to maintain equipment to unified combatant 
command for joint warfighting. 
Sec. 826. Market research. 
Sec. 827. Modification of competition requirements for purchases from Federal 
Prison Industries. 
Sec. 828. Multiyear contract authority for electricity from renewable energy 
sources. 
Sec. 829. Procurement of fire resistant rayon fiber for the production of uni-
forms from foreign sources. 
Sec. 830. Comptroller General review of noncompetitive awards of congressional 
and executive branch interest items. 
Subtitle D—Accountability in Contracting 
Sec. 841. Commission on Wartime Contracting in Iraq and Afghanistan. 
Sec. 842. Investigation of waste, fraud, and abuse in wartime contracts and 
contracting processes in Iraq and Afghanistan. 
Sec. 843. Enhanced competition requirements for task and delivery order con-
tracts.
483 
Sec. 844. Public disclosure of justification and approval documents for non-
competitive contracts. 
Sec. 845. Disclosure of government contractor audit findings. 
Sec. 846. Protection for contractor employees from reprisal for disclosure of 
certain information. 
Sec. 847. Requirements for senior Department of Defense officials seeking em-
ployment with defense contractors. 
Sec. 848. Report on contractor ethics programs of Major Defense contractors. 
Sec. 849. Contingency contracting training for personnel outside the acquisition 
workforce and evaluations of Army Commission recommenda-
tions. 
Subtitle E—Acquisition Workforce Provisions 
Sec. 851. Requirement for section on defense acquisition workforce in strategic 
human capital plan. 
Sec. 852. Department of Defense Acquisition Workforce Development Fund. 
Sec. 853. Extension of authority to fill shortage category positions for certain 
Federal acquisition positions. 
Sec. 854. Repeal of sunset of acquisition workforce training fund. 
Sec. 855. Federal acquisition workforce improvements. 
Subtitle F—Contracts in Iraq and Afghanistan 
Sec. 861. Memorandum of understanding on matters relating to contracting. 
Sec. 862. Contractors performing private security functions in areas of combat 
operations. 
Sec. 863. Comptroller General reviews and reports on contracting in Iraq and 
Afghanistan. 
Sec. 864. Definitions and other general provisions. 
Subtitle G—Defense Materiel Readiness Board 
Sec. 871. Establishment of Defense Materiel Readiness Board. 
Sec. 872. Critical materiel readiness shortfalls. 
Subtitle H—Other Matters 
Sec. 881. Clearinghouse for rapid identification and dissemination of commer-
cial information technologies. 
Sec. 882. Authority to license certain military designations and likenesses of 
weapons systems to toy and hobby manufacturers. 
Sec. 883. Modifications to limitation on contracts to acquire military flight sim-
ulator. 
Sec. 884. Requirements relating to waivers of certain domestic source limita-
tions relating to specialty metals. 
Sec. 885. Telephone services for military personnel serving in combat zones. 
Sec. 886. Enhanced authority to acquire products and services produced in Iraq 
and Afghanistan. 
Sec. 887. Defense Science Board review of Department of Defense policies and 
procedures for the acquisition of information technology. 
Sec. 888. Green procurement policy. 
Sec. 889. Comptroller General review of use of authority under the Defense 
Production Act of 1950. 
Sec. 890. Prevention of export control violations. 
Sec. 891. Procurement goal for Native Hawaiian-serving institutions and Alas-
ka Native-serving institutions.
484 
Sec. 892. Competition for procurement of small arms supplied to Iraq and Af-
ghanistan. 
SEC. 800. SHORT TITLE. 
This title may be cited as the ‘‘Acquisition Improve-
ment and Accountability Act of 2007’’. 
Subtitle A—Acquisition Policy and 
Management 
SEC. 801. INTERNAL CONTROLS FOR PROCUREMENTS ON 
BEHALF OF THE DEPARTMENT OF DEFENSE 
BY CERTAIN NON-DEFENSE AGENCIES. 
(a) INSPECTORS GENERAL REVIEWS AND DETER-
MINATIONS.— 
(1) IN
GENERAL.—For each covered non-de-
fense agency, the Inspector General of the Depart-
ment of Defense and the Inspector General of such 
covered non-defense agency shall, not later than the 
date specified in paragraph (2), jointly— 
(A) review— 
(i) the procurement policies, proce-
dures, and internal controls of such cov-
ered non-defense agency that are applica-
ble to the procurement of property and 
services on behalf of the Department by 
such covered non-defense agency; and 
(ii) the administration of such poli-
cies, procedures, and internal controls; and
485 
(B) determine in writing whether such cov-
ered non-defense agency is or is not compliant 
with defense procurement requirements. 
(2) DEADLINE FOR REVIEWS AND DETERMINA-
TIONS.—The reviews and determinations required by 
paragraph (1) shall take place as follows: 
(A) In the case of the General Services Ad-
ministration, by not later than March 15, 2010. 
(B) In the case of each of the Department 
of the Treasury, the Department of the Inte-
rior, and the National Aeronautics and Space 
Administration, by not later than March 15, 
2011. 
(C) In the case of each of the Department 
of Veterans Affairs and the National Institutes 
of Health, by not later than March 15, 2012. 
(3) SEPARATE
REVIEWS
AND
DETERMINA-
TIONS.—The Inspector General of the Department 
of Defense and the Inspector General of a covered 
non-defense agency may by joint agreement conduct 
separate reviews of the procurement of property and 
services on behalf of the Department of Defense that 
are conducted by separate business units, or under 
separate government-wide acquisition contracts, of 
the covered non-defense agency. If such separate re-
486 
views are conducted, the Inspectors General shall 
make a separate determination under paragraph 
(1)(B) with respect to each such separate review. 
(4) MEMORANDA OF UNDERSTANDING FOR RE-
VIEWS AND DETERMINATIONS.—Not later than one 
year before a review and determination is required 
under this subsection with respect to a covered non- 
defense agency, the Inspector General of the Depart-
ment of Defense and the Inspector General of the 
covered non-defense agency shall enter into a memo-
randum of understanding with each other to carry 
out such review and determination. 
(5) TERMINATION OF NON-COMPLIANCE DETER-
MINATION.—If the Inspector General of the Depart-
ment of Defense and the Inspector General of a cov-
ered non-defense agency determine, pursuant to 
paragraph (1)(B), that a covered non-defense agency 
is not compliant with defense procurement require-
ments, the Inspectors General shall terminate such 
a determination effective on the date on which the 
Inspectors General jointly— 
(A) determine that the non-defense agency 
is compliant with defense procurement require-
ments; and
487 
(B) notify the Secretary of Defense of that 
determination. 
(6) RESOLUTION OF DISAGREEMENTS.—If the 
Inspector General of the Department of Defense and 
the Inspector General of a covered non-defense agen-
cy are unable to agree on a joint determination 
under this subsection, a determination by the In-
spector General of the Department of Defense under 
this subsection shall be conclusive for the purposes 
of this section. 
(b) LIMITATION ON PROCUREMENTS ON BEHALF OF 
DEPARTMENT OF DEFENSE.— 
(1) Except as provided in paragraph (2), an ac-
quisition official of the Department of Defense may 
place an order, make a purchase, or otherwise pro-
cure property or services for the Department of De-
fense in excess of the simplified acquisition threshold 
through a non-defense agency only if— 
(A) in the case of a procurement by any 
non-defense agency in any fiscal year, the head 
of the non-defense agency has certified that the 
non-defense agency will comply with defense 
procurement requirements for the fiscal year; 
(B) in the case of—
488 
(i) a procurement by a covered non- 
defense agency in a fiscal year for which a 
memorandum of understanding is required 
by subsection (a)(4), the Inspector General 
of the Department of Defense and the In-
spector General of the covered non-defense 
agency have entered into such a memo-
randum of understanding; or 
(ii) a procurement by a covered non- 
defense agency in a fiscal year following 
the Inspectors General review and deter-
mination required by subsection (a), the 
Inspectors General have determined that a 
covered non-defense agency is compliant 
with defense procurement requirements or 
have terminated a prior determination of 
non-compliance in accordance with sub-
section (a)(5); and 
(C) the procurement is not otherwise pro-
hibited by section 817 of the John Warner Na-
tional Defense Authorization Act for Fiscal 
Year 2007 (Public Law 109–364) or section 
811 of the National Defense Authorization Act 
for Fiscal Year 2006 (Public Law 109–163).
489 
(2) EXCEPTION FOR PROCUREMENTS OF NEC-
ESSARY PROPERTY AND SERVICES.— 
(A) IN GENERAL.—The limitation in para-
graph (1) shall not apply to the procurement of 
property and services on behalf of the Depart-
ment of Defense by a non-defense agency dur-
ing any fiscal year for which there is in effect 
a written determination of the Under Secretary 
of Defense for Acquisition, Technology, and Lo-
gistics that it is necessary in the interest of the 
Department of Defense to procure property and 
services through the non-defense agency during 
such fiscal year. 
(B) SCOPE OF PARTICULAR EXCEPTION.— 
A written determination with respect to a non- 
defense agency under subparagraph (A) shall 
apply to any category of procurements through 
the non-defense agency that is specified in the 
determination. 
(c) GUIDANCE ON INTERAGENCY CONTRACTING.— 
(1) REQUIREMENT.—Not later than 180 days 
after the date of enactment of this Act, the Sec-
retary of Defense shall issue guidance on the use of 
interagency contracting by the Department of De-
fense.
490 
(2) MATTERS
COVERED.—The guidance re-
quired by paragraph (1) shall address the cir-
cumstances in which it is appropriate for Depart-
ment of Defense acquisition officials to procure 
goods or services through a contract entered into by 
an agency outside the Department of Defense. At a 
minimum, the guidance shall address— 
(A) the circumstances in which it is appro-
priate for such acquisition officials to use direct 
acquisitions; 
(B) the circumstances in which it is appro-
priate for such acquisition officials to use as-
sisted acquisitions; 
(C) the circumstances in which it is appro-
priate for such acquisition officials to use inter-
agency contracting to acquire items unique to 
the Department of Defense and the procedures 
for approving such interagency contracting; 
(D) the circumstances in which it is appro-
priate for such acquisition officials to use inter-
agency contracting to acquire items that are al-
ready being provided under a contract awarded 
by the Department of Defense; 
(E) tools that should be used by such ac-
quisition officials to determine whether items
491 
are already being provided under a contract 
awarded by the Department of Defense; and 
(F) procedures for ensuring that defense 
procurement requirements are identified and 
communicated to outside agencies involved in 
interagency contracting. 
(d) COMPLIANCE WITH DEFENSE PROCUREMENT 
REQUIREMENTS.—For the purposes of this section, a non- 
defense agency is compliant with defense procurement re-
quirements if the procurement policies, procedures, and 
internal controls of the non-defense agency applicable to 
the procurement of products and services on behalf of the 
Department of Defense, and the manner in which they are 
administered, are adequate to ensure the compliance of 
the non-defense agency with the requirements of laws and 
regulations (including applicable Department of Defense 
financial management regulations) that apply to procure-
ments of property and services made directly by the De-
partment of Defense. 
(e) TREATMENT
OF PROCUREMENTS
FOR FISCAL 
YEAR PURPOSES.—For the purposes of this section, a 
procurement shall be treated as being made during a par-
ticular fiscal year to the extent that funds are obligated 
by the Department of Defense for the procurement in that 
fiscal year.
492 
(f) DEFINITIONS.—In this section: 
(1) NON-DEFENSE AGENCY.—The term ‘‘non- 
defense agency’’ means any department or agency of 
the Federal Government other than the Department 
of Defense. Such term includes a covered non-de-
fense agency. 
(2) COVERED
NON-DEFENSE
AGENCY.—The 
term ‘‘covered non-defense agency’’ means each of 
the following: 
(A) The General Services Administration. 
(B) The Department of the Treasury. 
(C) The Department of the Interior. 
(D) The National Aeronautics and Space 
Administration. 
(E) The Department of Veterans Affairs. 
(F) The National Institutes of Health. 
(3) 
GOVERNMENT-WIDE
ACQUISITION
CON-
TRACT.—The term ‘‘government-wide acquisition 
contract’’ means a task or delivery order contract 
that— 
(A) is entered into by a non-defense agen-
cy; and 
(B) may be used as the contract under 
which property or services are procured for one
493 
or more other departments or agencies of the 
Federal Government. 
(4) SIMPLIFIED
ACQUISITION
THRESHOLD.— 
The term ‘‘simplified acquisition threshold’’ has the 
meaning provided by section 2302(7) of title 10, 
United States Code. 
(5) INTERAGENCY
CONTRACTING.—The term 
‘‘interagency contracting’’ means the exercise of the 
authority under section 1535 of title 31, United 
States Code, or other statutory authority, for Fed-
eral agencies to purchase goods and services under 
contracts entered into or administered by other 
agencies. 
(6) ACQUISITION OFFICIAL.—The term ‘‘acqui-
sition official’’, with respect to the Department of 
Defense, means— 
(A) a contracting officer of the Depart-
ment of Defense; or 
(B) any other Department of Defense offi-
cial authorized to approve a direct acquisition 
or an assisted acquisition on behalf of the De-
partment of Defense. 
(7) DIRECT
ACQUISITION.—The term ‘‘direct 
acquisition’’, with respect to the Department of De-
fense, means the type of interagency contracting
494 
through which the Department of Defense orders an 
item or service from a government-wide acquisition 
contract maintained by a non-defense agency. 
(8) ASSISTED
ACQUISITION.—The term ‘‘as-
sisted acquisition’’, with respect to the Department 
of Defense, means the type of interagency con-
tracting through which acquisition officials of a non- 
defense agency award a contract or task or delivery 
order for the procurement of goods or services on 
behalf of the Department of Defense. 
SEC. 802. LEAD SYSTEMS INTEGRATORS. 
(a) PROHIBITIONS ON THE USE OF LEAD SYSTEMS 
INTEGRATORS.— 
(1) PROHIBITION ON NEW LEAD SYSTEMS INTE-
GRATORS.—Effective October 1, 2010, the Depart-
ment of Defense may not award a new contract for 
lead systems integrator functions in the acquisition 
of a major system to any entity that was not per-
forming lead systems integrator functions in the ac-
quisition of the major system prior to the date of the 
enactment of this Act. 
(2) PROHIBITION ON LEAD SYSTEMS INTEGRA-
TORS
BEYOND
LOW-RATE
INITIAL
PRODUCTION.— 
Effective on the date of the enactment of this Act, 
the Department of Defense may award a new con-
495 
tract for lead systems integrator functions in the ac-
quisition of a major system only if— 
(A) the major system has not yet pro-
ceeded beyond low-rate initial production; or 
(B) the Secretary of Defense determines in 
writing that it would not be practicable to carry 
out the acquisition without continuing to use a 
contractor to perform lead systems integrator 
functions and that doing so is in the best inter-
est of the Department. 
(3) REQUIREMENTS RELATING TO DETERMINA-
TIONS.—A determination under paragraph (2)(B)— 
(A) shall specify the reasons why it would 
not be practicable to carry out the acquisition 
without continuing to use a contractor to per-
form lead systems integrator functions (includ-
ing a discussion of alternatives, such as the use 
of the Department of Defense workforce, or a 
system engineering and technical assistance 
contractor); 
(B) shall include a plan for phasing out 
the use of contracted lead systems integrator 
functions over the shortest period of time con-
sistent with the interest of the national defense;
496 
(C) may not be delegated below the level of 
the Under Secretary of Defense for Acquisition, 
Technology, and Logistics; and 
(D) shall be provided to the Committees on 
Armed Services of the Senate and the House of 
Representatives at least 45 days before the 
award of a contract pursuant to the determina-
tion. 
(b) ACQUISITION WORKFORCE.— 
(1) REQUIREMENT.—The Secretary of Defense 
shall ensure that the acquisition workforce is of the 
appropriate size and skill level necessary— 
(A) to accomplish inherently governmental 
functions related to acquisition of major sys-
tems; and 
(B) to effectuate the purpose of subsection 
(a) to minimize and eventually eliminate the use 
of contractors to perform lead systems inte-
grator functions. 
(2) REPORT.—The Secretary shall include an 
update on the progress made in complying with 
paragraph (1) in the annual report required by sec-
tion 820 of the John Warner National Defense Au-
thorization Act for Fiscal Year 2007 (Public Law 
109–364; 120 Stat. 2330).
497 
(c) EXCEPTION FOR CONTRACTS FOR OTHER MAN-
AGEMENT SERVICES.—The Department of Defense may 
continue to award contracts for the procurement of serv-
ices the primary purpose of which is to perform acquisition 
support functions with respect to the development or pro-
duction of a major system, if the following conditions are 
met with respect to each such contract: 
(1) The contract prohibits the contractor from 
performing inherently governmental functions. 
(2) The Department of Defense organization 
responsible for the development or production of the 
major system ensures that Federal employees are re-
sponsible for— 
(A) determining courses of action to be 
taken in the best interest of the government; 
and 
(B) determining best technical perform-
ance for the warfighter. 
(3) The contract requires that the prime con-
tractor for the contract may not advise or rec-
ommend the award of a contract or subcontract for 
the development or production of the major system 
to an entity owned in whole or in part by the prime 
contractor. 
(d) DEFINITIONS.—In this section:
498 
(1) LEAD
SYSTEMS
INTEGRATOR.—The term 
‘‘lead systems integrator’’ means— 
(A) a prime contractor for the development 
or production of a major system, if the prime 
contractor is not expected at the time of award 
to perform a substantial portion of the work on 
the system and the major subsystems; or 
(B) a prime contractor under a contract 
for the procurement of services the primary 
purpose of which is to perform acquisition func-
tions closely associated with inherently govern-
mental functions with respect to the develop-
ment or production of a major system. 
(2) MAJOR SYSTEM.—The term ‘‘major system’’ 
has the meaning given such term in section 2302d 
of title 10, United States Code. 
(3) LOW-RATE
INITIAL
PRODUCTION.—The 
term ‘‘low-rate initial production’’ has the meaning 
given such term in section 2400 of title 10, United 
States Code. 
SEC. 803. REINVESTMENT IN DOMESTIC SOURCES OF STRA-
TEGIC MATERIALS. 
(a) ASSESSMENT REQUIRED.—Not later than 180 
days after the date of the enactment of this Act, the Stra-
tegic Materials Protection Board established pursuant to
499 
section 187 of title 10, United States Code, shall perform 
an assessment of the extent to which domestic producers 
of strategic materials are investing and planning to invest 
on a sustained basis in the processes, infrastructure, work-
force training, and facilities required for the continued do-
mestic production of such materials to meet national de-
fense requirements. 
(b) COOPERATION OF DOMESTIC PRODUCERS.—The 
Department of Defense may take into consideration the 
degree of cooperation of any domestic producer of stra-
tegic materials with the assessment conducted under sub-
section (a) when determining how much weight to accord 
any comments provided by such domestic producer regard-
ing a proposed waiver of domestic source limitations pur-
suant to section 2533b of title 10, United States Code. 
(c) REPORT TO CONGRESSIONAL DEFENSE COMMIT-
TEES.—The Board shall include the findings and rec-
ommendations of the assessment required by subsection 
(a) in the first report submitted to Congress pursuant to 
section 187(d) of title 10, United States Code, after the 
completion of such assessment. 
(d) DEFINITION.—The term ‘‘strategic material’’ 
means— 
(1) a material designated as critical to national 
security by the Strategic Materials Protection Board
500 
in accordance with section 187 of title 10, United 
States Code; or 
(2) a specialty metal as defined by section 
2533b of title 10, United States Code. 
SEC. 804. CLARIFICATION OF THE PROTECTION OF STRA-
TEGIC MATERIALS CRITICAL TO NATIONAL 
SECURITY. 
(a) PROHIBITION.—Subsection (a) of section 2533b 
of title 10, United States Code, is amended— 
(1) by striking ‘‘Except as provided in sub-
sections (b) through (j), funds appropriated or oth-
erwise available to the Department of Defense may 
not be used for the procurement of—’’ and inserting 
‘‘Except as provided in subsections (b) through (m), 
the acquisition by the Department of Defense of the 
following items is prohibited:’’; 
(2) in paragraph (1)— 
(A) by striking ‘‘the following’’ and insert-
ing ‘‘The following’’; and 
(B) by striking ‘‘; or’’ and inserting a pe-
riod; and 
(3) in paragraph (2), by striking ‘‘a speciality’’ 
and inserting ‘‘A specialty’’.
501 
(b) APPLICABILITY TO ACQUISITION OF COMMERCIAL 
ITEMS.—Subsection (h) of such section is amended to 
read as follows: 
‘‘(h) APPLICABILITY TO ACQUISITIONS OF COMMER-
CIAL ITEMS.—(1) Except as provided in paragraphs (2) 
and (3), this section applies to acquisitions of commercial 
items, notwithstanding sections 34 and 35 of the Office 
of Federal Procurement Policy Act (41 U.S.C. 430 and 
431). 
‘‘(2) This section does not apply to contracts or sub-
contracts for the acquisition of commercially available off- 
the-shelf items, as defined in section 35(c) of the Office 
of Federal Procurement Policy Act (41 U.S.C. 431(c)), 
other than— 
‘‘(A) contracts or subcontracts for the acquisi-
tion of specialty metals, including mill products, 
such as bar, billet, slab, wire, plate and sheet, that 
have not been incorporated into end items, sub-
systems, assemblies, or components; 
‘‘(B) contracts or subcontracts for the acquisi-
tion of forgings or castings of specialty metals, un-
less such forgings or castings are incorporated into 
commercially available off-the-shelf end items, sub-
systems, or assemblies;
502 
‘‘(C) contracts or subcontracts for commercially 
available high performance magnets unless such high 
performance magnets are incorporated into commer-
cially available off-the-shelf-end items or subsystems; 
and 
‘‘(D) contracts or subcontracts for commercially 
available off-the-shelf fasteners, unless such fas-
teners are— 
‘‘(i) incorporated into commercially avail-
able off-the-shelf end items, subsystems, assem-
blies, or components; or 
‘‘(ii) purchased as provided in paragraph 
(3). 
‘‘(3) This section does not apply to fasteners that are 
commercial items that are purchased under a contract or 
subcontract with a manufacturer of such fasteners, if the 
manufacturer has certified that it will purchase, during 
the relevant calendar year, an amount of domestically 
melted specialty metal, in the required form, for use in 
the production of such fasteners for sale to the Depart-
ment of Defense and other customers, that is not less than 
50 percent of the total amount of the specialty metal that 
it will purchase to carry out the production of such fas-
teners.’’.
503 
(c) ELECTRONIC COMPONENTS.—Subsection (g) of 
such section is amended by striking ‘‘commercially avail-
able’’ and all that follows through the end of the sub-
section and inserting ‘‘electronic components, unless the 
Secretary of Defense, upon the recommendation of the 
Strategic Materials Protection Board pursuant to section 
187 of this title, determines that the domestic availability 
of a particular electronic component is critical to national 
security.’’. 
(d) ADDITIONAL EXCEPTIONS.—Section 2533b of 
title 10, United States Code, as amended by subsections 
(a), (b), and (c), is further amended— 
(1) by redesignating subsections (i) and (j) as 
subsections (l) and (m), respectively; and 
(2) by inserting after subsection (h) the fol-
lowing new subsections: 
‘‘(i) EXCEPTIONS FOR PURCHASES OF SPECIALTY 
METALS BELOW MINIMUM THRESHOLD.—(1) Notwith-
standing subsection (a), the Secretary of Defense or the 
Secretary of a military department may accept delivery of 
an item containing specialty metals that were not melted 
in the United States if the total amount of noncompliant 
specialty metals in the item does not exceed 2 percent of 
the total weight of specialty metals in the item.
504 
‘‘(2) This subsection does not apply to high perform-
ance magnets. 
‘‘(j) STREAMLINED COMPLIANCE FOR COMMERCIAL 
DERIVATIVE MILITARY ARTICLES.—(1) Subsection (a) 
shall not apply to an item acquired under a prime contract 
if the Secretary of Defense or the Secretary of a military 
department determines that— 
‘‘(A) the item is a commercial derivative mili-
tary article; and 
‘‘(B) the contractor certifies that the contractor 
and its subcontractors have entered into a contrac-
tual agreement, or agreements, to purchase an 
amount of domestically melted specialty metal in the 
required form, for use during the period of contract 
performance in the production of the commercial de-
rivative military article and the related commercial 
article, that is not less than the greater of— 
‘‘(i) an amount equivalent to 120 percent 
of the amount of specialty metal that is re-
quired to carry out the production of the com-
mercial derivative military article (including the 
work performed under each subcontract); or 
‘‘(ii) an amount equivalent to 50 percent of 
the amount of specialty metal that is purchased 
by the contractor and its subcontractors for use
505 
during such period in the production of the 
commercial derivative military article and the 
related commercial article. 
‘‘(2) For the purposes of this subsection, the amount 
of specialty metal that is required to carry out the produc-
tion of the commercial derivative military article includes 
specialty metal contained in any item, including commer-
cially available off-the-shelf items, incorporated into such 
commercial derivative military article. 
‘‘(k) NATIONAL SECURITY WAIVER.—(1) Notwith-
standing subsection (a), the Secretary of Defense may ac-
cept the delivery of an end item containing noncompliant 
materials if the Secretary determines in writing that ac-
ceptance of such end item is necessary to the national se-
curity interests of the United States. 
‘‘(2) A written determination under paragraph (1)— 
‘‘(A) may not be delegated below the level of 
the Deputy Secretary of Defense or the Under Sec-
retary of Defense for Acquisition, Technology, and 
Logistics; 
‘‘(B) shall specify the quantity of end items to 
which the waiver applies and the time period over 
which the waiver applies; and 
‘‘(C) shall be provided to the congressional de-
fense committees prior to making such a determina-
506 
tion (except that in the case of an urgent national 
security requirement, such certification may be pro-
vided to the defense committees up to 7 days after 
it is made). 
‘‘(3)(A) In any case in which the Secretary makes 
a determination under paragraph (1), the Secretary shall 
determine whether or not the noncompliance was knowing 
and willful. 
‘‘(B) If the Secretary determines that the noncompli-
ance was not knowing or willful, the Secretary shall ensure 
that the contractor or subcontractor responsible for the 
noncompliance develops and implements an effective plan 
to ensure future compliance. 
‘‘(C) If the Secretary determines that the noncompli-
ance was knowing or willful, the Secretary shall— 
‘‘(i) require the development and implementa-
tion of a plan to ensure future compliance; and 
‘‘(ii) consider suspending or debarring the con-
tractor or subcontractor until such time as the con-
tractor or subcontractor has effectively addressed 
the issues that lead to such noncompliance.’’. 
(e) ADDITIONAL DEFINITIONS.—Subsection (m) of 
section 2533b of title 10, United States Code, as redesig-
nated by subsection (c), is further amended by adding at 
the end the following:
507 
‘‘(3) The term ‘acquisition’ has the meaning 
provided in section 4 of the Office of Federal Pro-
curement Policy Act (41 U.S.C. 403). 
‘‘(4) The term ‘required form’ shall not apply 
to end items or to their components at any tier. The 
term ‘required form’ means in the form of mill prod-
uct, such as bar, billet, wire, slab, plate or sheet, 
and in the grade appropriate for the production of— 
‘‘(A) a finished end item delivered to the 
Department of Defense; or 
‘‘(B) a finished component assembled into 
an end item delivered to the Department of De-
fense. 
‘‘(5) The term ‘commercially available off-the- 
shelf’, has the meaning provided in section 35(c) of 
the Office of Federal Procurement Policy Act (41 
U.S.C. 431(c)). 
‘‘(6) The term ‘assemblies’ means items form-
ing a portion of a system or subsystem that can be 
provisioned and replaced as an entity and which in-
corporates multiple, replaceable parts. 
‘‘(7) The term ‘commercial derivative military 
article’ means an item procured by the Department 
of Defense that is or will be produced using the 
same production facilities, a common supply chain,
508 
and the same or similar production processes that 
are used for the production of articles predominantly 
used by the general public or by nongovernmental 
entities for purposes other than governmental pur-
poses. 
‘‘(8) The term ‘subsystem’ means a functional 
grouping of items that combine to perform a major 
function within an end item, such as electrical 
power, attitude control, and propulsion. 
‘‘(9) The term ‘end item’ means the final pro-
duction product when assembled or completed, and 
ready for issue, delivery, or deployment. 
‘‘(10) The term ‘subcontract’ includes a sub-
contract at any tier.’’. 
(f) CONFORMING AMENDMENTS.—Section 2533b of 
title 10, United States Code, is further amended— 
(1) in subsection (c)— 
(A) in the heading, by striking ‘‘PROCURE-
MENTS’’ and inserting ‘‘ACQUISITIONS’’; and 
(B) in paragraphs (1) and (2), by striking 
‘‘Procurements’’ and inserting ‘‘Acquisitions’’; 
(2) in subsection (d), by striking ‘‘procure-
ment’’ each place it appears and inserting ‘‘acquisi-
tion’’; and
509 
(3) in subsections (f) and (g), by striking ‘‘pro-
curements’’ each place it appears and inserting ‘‘ac-
quisitions’’. 
(g) IMPLEMENTATION.—Not later than 120 days 
after the date of the enactment of this Act, the Secretary 
of Defense shall prescribe regulations on the implementa-
tion of this section and the amendments made by this sec-
tion, including specific guidance on how thresholds estab-
lished in subsections (h)(3), (i) and (j) of section 2533b 
of title 10, United States Code, as amended by this sec-
tion, should be implemented. 
(h) REVISION OF DOMESTIC NONAVAILABILITY DE-
TERMINATIONS AND RULES.—No later than 180 days 
after the date of the enactment of this Act, any domestic 
nonavailability determination under section 2533b of title 
10, United States Code, including a class deviation, or 
rules made by the Department of Defense between Decem-
ber 6, 2006, and the date of the enactment of this Act, 
shall be reviewed and amended, as necessary, to comply 
with the amendments made by this section. This require-
ment shall not apply to a domestic nonavailability deter-
mination that applies to— 
(1) an individual contract that was entered into 
before the date of the enactment of this Act; or
510 
(2) an individual Department of Defense pro-
gram, except to the extent that such domestic non-
availability determination applies to contracts en-
tered into after the date of the enactment of this 
Act. 
(i) TRANSPARENCY REQUIREMENT
FOR COMMER-
CIALLY AVAILABLE OFF-THE-SHELF ITEM EXCEPTION.— 
The Secretary of Defense shall submit to the Committees 
on Armed Services of the Senate and House of Represent-
atives, not later than December 30, 2008, a report on the 
use of authority provided under subsection (h) of section 
2533b of title 10, United States Code, as amended by this 
section. Such report shall include, at a minimum, a de-
scription of types of items being procured as commercially 
available off-the-shelf items under such subsection and in-
corporated into noncommercial items. The Secretary shall 
submit an update of such report to such committees not 
later than December 30, 2009. 
SEC. 805. PROCUREMENT OF COMMERCIAL SERVICES. 
(a) REGULATIONS REQUIRED.—Not later than 180 
days after the date of the enactment of this Act , the Sec-
retary of Defense shall modify the regulations of the De-
partment of Defense for the procurement of commercial 
services for or on behalf of the Department of Defense.
511 
(b) 
APPLICABILITY
OF
COMMERCIAL
PROCE-
DURES.— 
(1) SERVICES OF A TYPE SOLD IN MARKET-
PLACE.—The regulations modified pursuant to sub-
section (a) shall ensure that services that are not of-
fered and sold competitively in substantial quantities 
in the commercial marketplace, but are of a type of-
fered and sold competitively in substantial quantities 
in the commercial marketplace, may be treated as 
commercial items for purposes of section 2306a of 
title 10, United States Code (relating to truth in ne-
gotiations), only if the contracting officer determines 
in writing that the offeror has submitted sufficient 
information to evaluate, through price analysis, the 
reasonableness of the price for such services. 
(2) INFORMATION SUBMITTED.—To the extent 
necessary to make a determination under paragraph 
(1), the contracting officer may request the offeror 
to submit— 
(A) prices paid for the same or similar 
commercial items under comparable terms and 
conditions by both government and commercial 
customers; and 
(B) if the contracting officer determines 
that the information described in subparagraph
512 
(A) is not sufficient to determine the reason-
ableness of price, other relevant information re-
garding the basis for price or cost, including in-
formation on labor costs, material costs, and 
overhead rates. 
(c) TIME-AND-MATERIALS CONTRACTS.— 
(1) COMMERCIAL
ITEM
ACQUISITIONS.—The 
regulations modified pursuant to subsection (a) shall 
ensure that procedures applicable to time-and-mate-
rials contracts and labor-hour contracts for commer-
cial item acquisitions may be used only for the fol-
lowing: 
(A) Services procured for support of a 
commercial item, as described in section 
4(12)(E) of the Office of Federal Procurement 
Policy Act (41 U.S.C. 403(12)(E)). 
(B) Emergency repair services. 
(C) Any other commercial services only to 
the extent that the head of the agency con-
cerned approves a determination in writing by 
the contracting officer that— 
(i) the services to be acquired are 
commercial services as defined in section 
4(12)(F) of the Office of Federal Procure-
ment Policy Act (41 U.S.C. 403(12)(F));
513 
(ii) if the services to be acquired are 
subject to subsection (b), the offeror of the 
services has submitted sufficient informa-
tion in accordance with that subsection; 
(iii) such services are commonly sold 
to the general public through use of time- 
and-materials or labor-hour contracts; and 
(iv) the use of a time-and-materials or 
labor-hour contract type is in the best in-
terest of the Government. 
(2) NON-COMMERCIAL
ITEM
ACQUISITIONS.— 
Nothing in this subsection shall be construed to pre-
clude the use of procedures applicable to time-and- 
materials contracts and labor-hour contracts for 
non-commercial item acquisitions for the acquisition 
of any category of services. 
SEC. 806. SPECIFICATION OF AMOUNTS REQUESTED FOR 
PROCUREMENT OF CONTRACT SERVICES. 
(a) SPECIFICATION OF AMOUNTS REQUESTED.—The 
budget justification materials submitted to Congress in 
support of the budget of the Department of Defense for 
any fiscal year after fiscal year 2009 shall identify clearly 
and separately the amounts requested in each budget ac-
count for the procurement of contract services.
514 
(b) INFORMATION PROVIDED.—For each budget ac-
count, the materials submitted shall clearly identify— 
(1) the amount requested for each Department 
of Defense component, installation, or activity; and 
(2) the amount requested for each type of serv-
ice to be provided. 
(c) CONTRACT SERVICES DEFINED.—In this section, 
the term ‘‘contract services’’— 
(1) means services from contractors; but 
(2) excludes services relating to research and 
development and services relating to military con-
struction. 
SEC. 807. INVENTORIES AND REVIEWS OF CONTRACTS FOR 
SERVICES. 
(a) INVENTORY REQUIREMENT.—Section 2330a of 
title 10, United States Code, is amended— 
(1) by redesignating subsection (d) as sub-
section (g); 
(2) by striking subsection (c) and inserting the 
following: 
‘‘(c) INVENTORY.—(1) Not later than the end of the 
third quarter of each fiscal year, the Secretary of Defense 
shall submit to Congress an annual inventory of the activi-
ties performed during the preceding fiscal year pursuant 
to contracts for services for or on behalf of the Depart-
515 
ment of Defense. The entry for an activity on an inventory 
under this subsection shall include, for the fiscal year cov-
ered by such entry, the following: 
‘‘(A) The functions and missions performed by 
the contractor. 
‘‘(B) The contracting organization, the compo-
nent of the Department of Defense administering 
the contract, and the organization whose require-
ments are being met through contractor performance 
of the function. 
‘‘(C) The funding source for the contract under 
which the function is performed by appropriation 
and operating agency. 
‘‘(D) The fiscal year for which the activity first 
appeared on an inventory under this section. 
‘‘(E) The number of full-time contractor em-
ployees (or its equivalent) paid for the performance 
of the activity. 
‘‘(F) A determination whether the contract pur-
suant to which the activity is performed is a per-
sonal services contract. 
‘‘(G) A summary of the data required to be col-
lected for the activity under subsection (a).
516 
‘‘(2) The inventory required under this subsection 
shall be submitted in unclassified form, but may include 
a classified annex. 
‘‘(d) PUBLIC AVAILABILITY OF INVENTORIES.—Not 
later than 30 days after the date on which an inventory 
under subsection (c) is required to be submitted to Con-
gress, the Secretary shall— 
‘‘(1) make the inventory available to the public; 
and 
‘‘(2) publish in the Federal Register a notice 
that the inventory is available to the public. 
‘‘(e) REVIEW
AND PLANNING REQUIREMENTS.— 
Within 90 days after the date on which an inventory is 
submitted under subsection (c), the Secretary of the mili-
tary department or head of the Defense Agency respon-
sible for activities in the inventory shall— 
‘‘(1) review the contracts and activities in the 
inventory for which such Secretary or agency head 
is responsible; 
‘‘(2) ensure that— 
‘‘(A) each contract on the list that is a 
personal services contract has been entered 
into, and is being performed, in accordance with 
applicable statutory and regulatory require-
ments;
517 
‘‘(B) the activities on the list do not in-
clude any inherently governmental functions; 
and 
‘‘(C) to the maximum extent practicable, 
the activities on the list do not include any 
functions closely associated with inherently gov-
ernmental functions; 
‘‘(3) identify activities that should be considered 
for conversion— 
‘‘(A) to performance by civilian employees 
of the Department of Defense pursuant to sec-
tion 2463 of this title; or 
‘‘(B) to an acquisition approach that would 
be more advantageous to the Department of 
Defense; and 
‘‘(4) develop a plan to provide for appropriate 
consideration of the conversion of activities identified 
under paragraph (3) within a reasonable period of 
time. 
‘‘(f) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to authorize the performance of 
personal services by a contractor except where expressly 
authorized by a provision of law other than this section.’’; 
and
518 
(3) by adding at the end of subsection (g) (as 
so redesignated) the following new paragraphs: 
‘‘(3) FUNCTION CLOSELY ASSOCIATED WITH IN-
HERENTLY GOVERNMENTAL FUNCTIONS.—The term 
‘function closely associated with inherently govern-
mental functions’ has the meaning given that term 
in section 2383(b)(3) of this title. 
‘‘(4) 
INHERENTLY
GOVERNMENTAL
FUNC-
TIONS.—The term ‘inherently governmental func-
tions’ has the meaning given that term in section 
2383(b)(2) of this title. 
‘‘(5) PERSONAL
SERVICES
CONTRACT.—The 
term ‘personal services contract’ means a contract 
under which, as a result of its terms or conditions 
or the manner of its administration during perform-
ance, contractor personnel are subject to the rel-
atively continuous supervision and control of one or 
more Government officers or employees, except that 
the giving of an order for a specific article or serv-
ice, with the right to reject the finished product or 
result, is not the type of supervision or control that 
makes a contract a personal services contract.’’. 
(b) EFFECTIVE DATE.—
519 
(1) The amendments made by subsection (a) 
shall be effective upon the date of the enactment of 
this Act. 
(2) The first inventory required by section 
2330a(c) of title 10, United States Code, as added 
by subsection (a), shall be submitted not later than 
the end of the third quarter of fiscal year 2008. 
SEC. 808. INDEPENDENT MANAGEMENT REVIEWS OF CON-
TRACTS FOR SERVICES. 
(a) GUIDANCE AND INSTRUCTIONS.—Not later than 
180 days after the date of the enactment of this Act, the 
Secretary of Defense shall issue guidance, with detailed 
implementation instructions, for the Department of De-
fense to provide for periodic independent management re-
views of contracts for services. The independent manage-
ment review guidance and instructions issued pursuant to 
this subsection shall be designed to evaluate, at a min-
imum— 
(1) contract performance in terms of cost, 
schedule, and requirements; 
(2) the use of contracting mechanisms, includ-
ing the use of competition, the contract structure 
and type, the definition of contract requirements, 
cost or pricing methods, the award and negotiation
520 
of task orders, and management and oversight 
mechanisms; 
(3) the contractor’s use, management, and over-
sight of subcontractors; 
(4) the staffing of contract management and 
oversight functions; and 
(5) the extent of any pass-throughs, and exces-
sive pass-through charges (as defined in section 852 
of the John Warner National Defense Authorization 
Act for Fiscal Year 2007), by the contractor. 
(b) ADDITIONAL SUBJECT OF REVIEW.—In addition 
to the matters required by subsection (a), the guidance 
and instructions issued pursuant to subsection (a) shall 
provide for procedures for the periodic review of contracts 
under which one contractor provides oversight for services 
performed by other contractors. In particular, the proce-
dures shall be designed to evaluate, at a minimum— 
(1) the extent of the agency’s reliance on the 
contractor to perform acquisition functions closely 
associated with inherently governmental functions as 
defined in section 2383(b)(3) of title 10, United 
States Code; and 
(2) the financial interest of any prime con-
tractor performing acquisition functions described in 
paragraph (1) in any contract or subcontract with
521 
regard to which the contractor provided advice or 
recommendations to the agency. 
(c) ELEMENTS.—The guidance and instructions 
issued pursuant to subsection (a) shall address, at a min-
imum— 
(1) the contracts subject to independent man-
agement reviews, including any applicable thresholds 
and exceptions; 
(2) the frequency with which independent man-
agement reviews shall be conducted; 
(3) the composition of teams designated to per-
form independent management reviews; 
(4) any phase-in requirements needed to ensure 
that qualified staff are available to perform inde-
pendent management reviews; 
(5) procedures for tracking the implementation 
of recommendations made by independent manage-
ment review teams; and 
(6) procedures for developing and disseminating 
lessons learned from independent management re-
views. 
(c) REPORTS.— 
(1) REPORT
ON
GUIDANCE
AND
INSTRUC-
TION.—Not later than 270 days after the date of the 
enactment of this Act, the Secretary of Defense shall
522 
submit to the congressional defense committees a re-
port setting forth the guidance and instructions 
issued pursuant to subsection (a). 
(2) GAO REPORT ON IMPLEMENTATION.—Not 
later than two years after the date of the enactment 
of this Act, the Comptroller General of the United 
States shall submit to the congressional defense 
committees a report on the implementation of the 
guidance and instructions issued pursuant to sub-
section (a). 
SEC. 809. IMPLEMENTATION AND ENFORCEMENT OF RE-
QUIREMENTS 
APPLICABLE 
TO 
UNDEFINITIZED CONTRACTUAL ACTIONS. 
(a) GUIDANCE AND INSTRUCTIONS.—Not later than 
180 days after the date of the enactment of this Act, the 
Secretary of Defense shall issue guidance, with detailed 
implementation instructions, for the Department of De-
fense to ensure the implementation and enforcement of re-
quirements applicable to undefinitized contractual actions. 
(b) ELEMENTS.—The guidance and instructions 
issued pursuant to subsection (a) shall address, at a min-
imum— 
(1) the circumstances in which it is, and is not, 
appropriate for Department of Defense officials to 
use undefinitized contractual actions;
523 
(2) approval requirements (including thresh-
olds) for the use of undefinitized contractual actions; 
(3) procedures for ensuring that timelines for 
the definitization of undefinitized contractual actions 
are met; 
(4) procedures for ensuring compliance with 
regulatory limitations on the obligation of funds pur-
suant to undefinitized contractual actions; 
(5) procedures for ensuring compliance with 
regulatory limitations on profit or fee with respect to 
costs incurred before the definitization of an 
undefinitized contractual action; and 
(6) reporting requirements for undefinitized 
contractual actions that fail to meet required 
timelines for definitization or fail to comply with 
regulatory limitations on the obligation of funds or 
on profit or fee. 
(c) REPORTS.— 
(1) REPORT
ON
GUIDANCE
AND
INSTRUC-
TIONS.—Not later than 210 days after the date of 
the enactment of this Act, the Secretary of Defense 
shall submit to the congressional defense committees 
a report setting forth the guidance and instructions 
issued pursuant to subsection (a).
524 
(2) GAO REPORT.—Not later than two years 
after the date of the enactment of this Act, the 
Comptroller General of the United States shall sub-
mit to the congressional defense committees a report 
on the extent to which the guidance and instructions 
issued pursuant to subsection (a) have resulted in 
improvements to— 
(A) the level of insight that senior Depart-
ment of Defense officials have into the use of 
undefinitized contractual actions; 
(B) the appropriate use of undefinitized 
contractual actions; 
(C) 
the 
timely 
definitization 
of 
undefinitized contractual actions; and 
(D) the negotiation of appropriate profits 
and fees for undefinitized contractual actions. 
SEC. 810. CLARIFICATION OF LIMITED ACQUISITION AU-
THORITY FOR SPECIAL OPERATIONS COM-
MAND. 
Section 167(e)(4) of title 10, United States Code, is 
amended— 
(1) by redesignating subparagraph (C) as sub-
paragraph (D); and 
(2) by inserting after subparagraph (B) the fol-
lowing new subparagraph:
525 
‘‘(C)(i) The staff of the commander shall include a 
command acquisition executive, who shall be responsible 
for the overall supervision of acquisition matters for the 
special operations command. The command acquisition ex-
ecutive shall have the authority to— 
‘‘(I) negotiate memoranda of agreement with 
the military departments to carry out the acquisition 
of equipment, material, supplies, and services de-
scribed in subparagraph (A) on behalf of the com-
mand; 
‘‘(II) supervise the acquisition of equipment, 
material, supplies, and services described in subpara-
graph (A), regardless of whether such acquisition is 
carried out by the command, or by a military de-
partment pursuant to a delegation of authority by 
the command; 
‘‘(III) represent the command in discussions 
with the military departments regarding acquisition 
programs for which the command is a customer; and 
‘‘(IV) work with the military departments to en-
sure that the command is appropriately represented 
in any joint working group or integrated product 
team regarding acquisition programs for which the 
command is a customer.
526 
‘‘(ii) The command acquisition executive of the spe-
cial operations command shall be included on the distribu-
tion list for acquisition directives and instructions of the 
Department of Defense.’’. 
Subtitle B—Provisions Relating to 
Major Defense Acquisition Pro-
grams 
SEC. 811. REQUIREMENTS APPLICABLE TO MULTIYEAR 
CONTRACTS FOR THE PROCUREMENT OF 
MAJOR SYSTEMS OF THE DEPARTMENT OF 
DEFENSE. 
(a) ADDITIONAL REQUIREMENTS APPLICABLE
TO 
MULTIYEAR CONTRACTS.—Section 2306b of title 10, 
United States Code, is amended as follows: 
(1) Subsection (a) of such section is amended 
by adding at the end the following new paragraph: 
‘‘(7) In the case of a contract in an amount 
equal to or greater than $500,000,000, that the con-
ditions required by subparagraphs (C) through (F) 
of paragraph (1) of subsection (i) will be met, in ac-
cordance with the Secretary’s certification and deter-
mination under such subsection, by such contract.’’. 
(2) Subsection (i)(1) of such section is amended 
by inserting after ‘‘unless’’ the following: ‘‘the Sec-
retary of Defense certifies in writing by no later
527 
than March 1 of the year in which the Secretary re-
quests legislative authority to enter into such con-
tract that’’. 
(3) Subsection (i)(1) of such section is further 
amended— 
(A) by redesignating subparagraph (B) as 
subparagraph (G); and 
(B) by striking subparagraph (A) and in-
serting the following: 
‘‘(A) The Secretary has determined that each of 
the requirements in paragraphs (1) through (6) of 
subsection (a) will be met by such contract and has 
provided the basis for such determination to the con-
gressional defense committees. 
‘‘(B) The Secretary’s determination under sub-
paragraph (A) was made after the completion of a 
cost analysis performed by the Cost Analysis Im-
provement Group of the Department of Defense and 
such analysis supports the findings. 
‘‘(C) The system being acquired pursuant to 
such contract has not been determined to have expe-
rienced cost growth in excess of the critical cost 
growth threshold pursuant to section 2433(d) of this 
title within 5 years prior to the date the Secretary 
anticipates such contract (or a contract for advance
528 
procurement entered into consistent with the author-
ization for such contract) will be awarded. 
‘‘(D) A sufficient number of end items of the 
system being acquired under such contract have 
been delivered at or within the most current esti-
mates of the program acquisition unit cost or pro-
curement unit cost for such system to determine 
that current estimates of such unit costs are real-
istic. 
‘‘(E) During the fiscal year in which such con-
tract is to be awarded, sufficient funds will be avail-
able to perform the contract in such fiscal year, and 
the future-years defense program for such fiscal year 
will include the funding required to execute the pro-
gram without cancellation. 
‘‘(F) The contract is a fixed price type con-
tract.’’. 
(4) Subsection (i) of such section is further 
amended by adding at the end the following new 
paragraphs: 
‘‘(5) The Secretary may make the certification under 
paragraph (1) notwithstanding the fact that one or more 
of the conditions of such certification are not met if the 
Secretary determines that, due to exceptional cir-
cumstances, proceeding with a multiyear contract under
529 
this section is in the best interest of the Department of 
Defense and the Secretary provides the basis for such de-
termination with the certification. 
‘‘(6) The Secretary of Defense may not delegate the 
authority to make the certification under paragraph (1) 
or the determination under paragraph (5) to an official 
below the level of Under Secretary of Defense for Acquisi-
tion, Technology, and Logistics. 
‘‘(7) The Secretary of Defense shall send a notifica-
tion containing the findings of the agency head under sub-
section (a), and the basis for such findings, 30 days prior 
to the award of a multiyear contract for a defense acquisi-
tion program that has been specifically authorized by 
law.’’. 
(5) Such section is further amended by adding 
at the end the following new subsection: 
‘‘(m) INCREASED FUNDING AND REPROGRAMMING 
REQUESTS.—Any request for increased funding for the 
procurement of a major system under a multiyear contract 
authorized under this section shall be accompanied by an 
explanation of how the request for increased funding af-
fects the determinations made by the Secretary under sub-
section (i).’’. 
(b) APPLICABILITY.—The amendments made by this 
section shall take effect on the date of the enactment of
530 
this Act and shall apply with respect to multiyear con-
tracts for the purchase of major systems for which legisla-
tive authority is requested on or after that date. 
SEC. 812. CHANGES TO MILESTONE B CERTIFICATIONS. 
Section 2366a of title 10, United States Code, is 
amended— 
(1) by amending subsection (a) to read as fol-
lows: 
‘‘(a) CERTIFICATION.—A major defense acquisition 
program may not receive Milestone B approval, or Key 
Decision Point B approval in the case of a space program, 
until the milestone decision authority— 
‘‘(1) has received a business case analysis and 
certifies on the basis of the analysis that— 
‘‘(A) the program is affordable when con-
sidering the ability of the Department of De-
fense to accomplish the program’s mission 
using alternative systems; 
‘‘(B) the program is affordable when con-
sidering the per unit cost and the total acquisi-
tion cost in the context of the total resources 
available during the period covered by the fu-
ture-years defense program submitted during 
the fiscal year in which the certification is 
made;
531 
‘‘(C) reasonable cost and schedule esti-
mates have been developed to execute the prod-
uct development and production plan under the 
program; and 
‘‘(D) funding is available to execute the 
product development and production plan under 
the program, through the period covered by the 
future-years defense program submitted during 
the fiscal year in which the certification is 
made, consistent with the estimates described in 
subparagraph (C) for the program; and 
‘‘(2) further certifies that— 
‘‘(A) appropriate market research has been 
conducted prior to technology development to 
reduce duplication of existing technology and 
products; 
‘‘(B) the Department of Defense has com-
pleted an analysis of alternatives with respect to 
the program; 
‘‘(C) the Joint Requirements Oversight 
Council has accomplished its duties with respect 
to the program pursuant to section 181(b) of 
this title, including an analysis of the oper-
ational requirements for the program;
532 
‘‘(D) the technology in the program has 
been demonstrated in a relevant environment; 
‘‘(E) the program demonstrates a high 
likelihood of accomplishing its intended mission; 
and 
‘‘(F) the program complies with all rel-
evant policies, regulations, and directives of the 
Department of Defense.’’; 
(2) by redesignating subsections (b), (c), (d), 
and (e) as subsections (c), (d), (e), and (f), respec-
tively; 
(3) by inserting after subsection (a) the fol-
lowing new subsection (b): 
‘‘(b) CHANGES TO CERTIFICATION.—(1) The pro-
gram manager for a major defense acquisition program 
that has received certification under subsection (a) shall 
immediately notify the milestone decision authority of any 
changes to the program that— 
‘‘(A) alter the substantive basis for the certifi-
cation of the milestone decision authority relating to 
any component of such certification specified in 
paragraph (1) or (2) of subsection (a); or 
‘‘(B) otherwise cause the program to deviate 
significantly from the material provided to the mile-
533 
stone decision authority in support of such certifi-
cation. 
‘‘(2) Upon receipt of information under paragraph 
(1), the milestone decision authority may withdraw the 
certification concerned or rescind Milestone B approval (or 
Key Decision Point B approval in the case of a space pro-
gram) if the milestone decision authority determines that 
such certification or approval is no longer valid.’’; 
(4) in subsection (c), as redesignated by para-
graph (1)— 
(A) by inserting ‘‘(1)’’ before ‘‘The certifi-
cation’’; and 
(B) by adding at the end the following new 
paragraph (2): 
‘‘(2) A summary of any information provided to the 
milestone decision authority pursuant to subsection (b) 
and a description of the actions taken as a result of such 
information shall be submitted with the first Selected Ac-
quisition Report submitted under section 2432 of this title 
after receipt of such information by the milestone decision 
authority.’’; 
(5) in subsection (d), as so redesignated— 
(A) by striking ‘‘authority may waive’’ and 
inserting the following: ‘‘authority may, at the 
time of Milestone B approval (or Key Decision
534 
Point B approval in the case of a space pro-
gram) or at the time that such milestone deci-
sion authority withdraws a certification or re-
scinds Milestone B approval (or Key Decision 
Point B approval in the case of a space pro-
gram) pursuant to subsection (b)(2), waive’’; 
and 
(B) by striking ‘‘paragraph (1), (2), (3), 
(4), (5), (6), (7), (8), or (9)’’ and inserting 
‘‘paragraph (1) or (2)’’; and 
(6) in subsection (e), as so redesignated, by 
striking ‘‘subsection (c)’’ and inserting ‘‘subsection 
(d)’’. 
SEC. 813. COMPTROLLER GENERAL REPORT ON DEPART-
MENT 
OF 
DEFENSE 
ORGANIZATION 
AND 
STRUCTURE FOR MAJOR DEFENSE ACQUISI-
TION PROGRAMS. 
(a) REPORT REQUIRED.—Not later than one year 
after the date of the enactment of this Act, the Comp-
troller General of the United States shall submit to the 
congressional defense committees a report on potential 
modifications of the organization and structure of the De-
partment of Defense for major defense acquisition pro-
grams.
535 
(b) ELEMENTS.—The report required by subsection 
(a) shall include the results of a review, conducted by the 
Comptroller General for purposes of the report, regarding 
the feasibility and advisability of, at a minimum, the fol-
lowing: 
(1) Revising the acquisition process for major 
defense acquisition programs by establishing shorter, 
more frequent acquisition program milestones. 
(2) Requiring certifications of program status 
to the defense acquisition executive and Congress 
prior to milestone approval for major defense acqui-
sition programs. 
(3) Establishing a new office (to be known as 
the ‘‘Office of Independent Assessment’’) to provide 
independent cost estimates and performance esti-
mates for major defense acquisition programs. 
(4) Requiring the milestone decision authority 
for a major defense acquisition program to specify, 
at the time of Milestone B approval, or Key Decision 
Point B approval, as applicable, the period of time 
that will be required to deliver an initial operational 
capability to the relevant combatant commanders. 
(5) Establishing a materiel solutions process for 
addressing identified gaps in critical warfighting ca-
pabilities, under which process the Under Secretary
536 
of Defense for Acquisition, Technology, and Logis-
tics circulates among the military departments and 
appropriate Defense Agencies a request for pro-
posals for technologies and systems to address such 
gaps. 
(6) Modifying the role played by chiefs of staff 
of the Armed Forces in the requirements, resource 
allocation, and acquisition processes. 
(7) Establishing a process in which the com-
manders of combatant commands assess, and pro-
vide input on, the capabilities needed to successfully 
accomplish the missions in the operational and con-
tingency plans of their commands over a long-term 
planning horizon of 15 years or more, taking into 
account expected changes in threats, the geo-political 
environment, and doctrine, training, and operational 
concepts. 
(c) CONSULTATION.—In conducting the review re-
quired under subsection (b) for the report required by sub-
section (a), the Comptroller General shall obtain the views 
of the following: 
(1) Senior acquisition officials currently serving 
in the Department of Defense. 
(2) Senior military officers involved in setting 
requirements for the joint staff, the Armed Forces,
537 
and the combatant commands currently serving in 
the Department of Defense. 
(3) Individuals who formerly served as senior 
acquisition officials in the Department of Defense. 
(4) Participants in previous reviews of the orga-
nization and structure of the Department of Defense 
for the acquisition of major weapon systems, includ-
ing the President’s Blue Ribbon Commission on De-
fense Management in 1986. 
(5) Other experts on the acquisition of major 
weapon systems. 
(6) Appropriate experts in the Government Ac-
countability Office. 
SEC. 814. CLARIFICATION OF SUBMISSION OF COST OR 
PRICING DATA ON NONCOMMERCIAL MODI-
FICATIONS OF COMMERCIAL ITEMS. 
(a) MEASUREMENT OF PERCENTAGE AT CONTRACT 
AWARD.—Section 2306a(b)(3)(A) of title 10, United 
States Code, is amended by inserting after ‘‘total price of 
the contract’’ the following: ‘‘(at the time of contract 
award)’’. 
(b) HARMONIZATION OF THRESHOLDS FOR COST OR 
PRICING DATA.—Section 2306a(b)(3)(A) of title 10, 
United States Code, is amended by striking ‘‘$500,000’’ 
and inserting ‘‘the amount specified in subsection
538 
(a)(1)(A)(i), as adjusted from time to time under sub-
section (a)(7),’’. 
SEC. 815. CLARIFICATION OF RULES REGARDING THE PRO-
CUREMENT OF COMMERCIAL ITEMS. 
(a) TREATMENT
OF SUBSYSTEMS, COMPONENTS, 
AND SPARE PARTS AS COMMERCIAL ITEMS.— 
(1) IN
GENERAL.—Section 2379 of title 10, 
United States Code, is amended— 
(A) in subsection (a)— 
(i) by redesignating paragraph (2) as 
paragraph (3); 
(ii) in paragraph (1)(B), by striking 
‘‘and’’ at the end; and 
(iii) by inserting after paragraph (1), 
the following: 
‘‘(2) the offeror has submitted sufficient infor-
mation to evaluate, through price analysis, the rea-
sonableness of the price for such system; and’’; 
(B) by striking subsection (b) and insert-
ing the following new subsection (b): 
‘‘(b) TREATMENT OF SUBSYSTEMS AS COMMERCIAL 
ITEMS.—A subsystem of a major weapon system (other 
than a commercially available off-the-shelf item as defined 
in section 35(c) of the Office of Federal Procurement Pol-
icy Act (41 U.S.C. 431(c))) shall be treated as a commer-
539 
cial item and purchased under procedures established for 
the procurement of commercial items only if— 
‘‘(1) the subsystem is intended for a major 
weapon system that is being purchased, or has been 
purchased, under procedures established for the pro-
curement of commercial items in accordance with 
the requirements of subsection (a); or 
‘‘(2) the contracting officer determines in writ-
ing that— 
‘‘(A) the subsystem is a commercial item, 
as defined in section 4(12) of the Office of Fed-
eral Procurement Policy Act (41 U.S.C. 
403(12)); and 
‘‘(B) the offeror has submitted sufficient 
information to evaluate, through price analysis, 
the reasonableness of the price for such sub-
system.’’; 
(C) by redesignating subsections (c) and 
(d) as subsections (e) and (f), respectively; and 
(D) by inserting after subsection (b) the 
following new subsections (c) and (d): 
‘‘(c) TREATMENT
OF COMPONENTS
AND SPARE 
PARTS
AS COMMERCIAL ITEMS.—(1) A component or 
spare part for a major weapon system (other than a com-
mercially available off-the-shelf item as defined in section
540 
35(c) of the Office of Federal Procurement Policy Act (41 
U.S.C. 431(c))) may be treated as a commercial item for 
the purposes of section 2306a of this title only if— 
‘‘(A) the component or spare part is intended 
for— 
‘‘(i) a major weapon system that is being 
purchased, or has been purchased, under proce-
dures established for the procurement of com-
mercial items in accordance with the require-
ments of subsection (a); or 
‘‘(ii) a subsystem of a major weapon sys-
tem that is being purchased, or has been pur-
chased, under procedures established for the 
procurement of commercial items in accordance 
with the requirements of subsection (b); or 
‘‘(B) the contracting officer determines in writ-
ing that— 
‘‘(i) the component or spare part is a com-
mercial item, as defined in section 4(12) of the 
Office of Federal Procurement Policy Act (41 
U.S.C. 403(12)); and 
‘‘(ii) the offeror has submitted sufficient 
information to evaluate, through price analysis, 
the reasonableness of the price for such compo-
nent or spare part.
541 
‘‘(2) This subsection shall apply only to components 
and spare parts that are acquired by the Department of 
Defense through a prime contract or a modification to a 
prime contract (or through a subcontract under a prime 
contract or modification to a prime contract on which the 
prime contractor adds no, or negligible, value). 
‘‘(d) INFORMATION SUBMITTED.—To the extent nec-
essary to make a determination under subsection (a)(2), 
(b)(2), or (c)(1)(B), the contracting officer may request 
the offeror to submit— 
‘‘(1) prices paid for the same or similar com-
mercial items under comparable terms and condi-
tions by both government and commercial customers; 
and 
‘‘(2) if the contracting officer determines that 
the information described in paragraph (1) is not 
sufficient to determine the reasonableness of price, 
other relevant information regarding the basis for 
price or cost, including information on labor costs, 
material costs, and overhead rates.’’. 
(2) CONFORMING AMENDMENT TO TECHNICAL 
DATA PROVISION.—Section 2321(f)(2) of such title 
is amended by striking ‘‘(whether or not under a 
contract for commercial items)’’ and inserting 
‘‘(other than technical data for a commercially avail-
542 
able off-the-shelf item as defined in section 35(c) of 
the Office of Federal Procurement Policy Act (41 
U.S.C. 431(c)))’’. 
(b) SALES OF COMMERCIAL ITEMS TO NONGOVERN-
MENTAL ENTITIES.—Not later than 180 days after the 
date of the enactment of this Act, the Secretary of Defense 
shall modify the regulations of the Department of Defense 
on the procurement of commercial items in order to clarify 
that the terms ‘‘general public’’ and ‘‘nongovernmental en-
tities’’ in such regulations do not include the Federal Gov-
ernment or a State, local, or foreign government. 
SEC. 816. REVIEW OF SYSTEMIC DEFICIENCIES ON MAJOR 
DEFENSE ACQUISITION PROGRAMS. 
(a) ANNUAL REVIEW.—The Under Secretary of De-
fense for Acquisition, Technology, and Logistics shall con-
duct an annual review of systemic deficiencies in the major 
defense acquisition programs of the Department of De-
fense for each fiscal year in which three or more major 
defense acquisition programs— 
(1) experience a critical cost growth threshold 
breach; 
(2) have a section 2366a certification with-
drawn; or 
(3) have a Milestone A approval or Key Deci-
sion Point A approval rescinded, by the milestone
543 
decision authority under subsection (b) of section 
2366b of title 10, United States Code, as added by 
section 943 of this Act. 
(b) CONTENT OF REVIEW.—The review conducted 
under subsection (a) shall— 
(1) identify common factors, including any sys-
temic deficiencies in the budget, requirements, and 
acquisition policies and practices, that may have 
contributed to problems with major defense acquisi-
tion programs covered by the criteria in subsection 
(a); 
(2) assess the adequacy of corrective actions 
taken or to be taken to address cost growth or other 
performance deficiencies in programs covered by the 
criteria in subsection (a); and 
(3) make recommendations for any changes in 
budget, requirements, and acquisition policies and 
practices that may be appropriate to avoid similar 
problems with major defense acquisition programs in 
the future. 
(c) DEFINITIONS.—In this section: 
(1) CRITICAL
COST
GROWTH
THRESHOLD 
BREACH.—The term ‘‘critical cost growth threshold 
breach’’ means a determination under section 
2433(d) of title 10, United States Code, by the Sec-
544 
retary of a military department with respect to a 
major defense acquisition program that the program 
acquisition unit cost has increased by a percentage 
equal to or greater than the critical cost growth 
threshold or that the procurement unit cost has in-
creased by a percentage equal to or greater than the 
critical cost growth threshold. 
(2) SECTION 2366a CERTIFICATION.—The term 
‘‘section 2366a certification’’ means a certification 
with respect to a major defense acquisition program 
under section 2366a(a) of title 10, United States 
Code, by the milestone decision authority. 
(d) REPORT.—Not later than July 15, 2008, and not 
later than August 15 of each year from 2009 through 
2012, the Secretary of Defense shall submit to the con-
gressional defense committees a report on the results of 
the annual review conducted (if any) for the preceding fis-
cal year under subsection (a). 
(e) SUNSET.—The requirement to conduct an annual 
review under subsection (a) shall terminate on September 
30, 2012. 
SEC. 817. INVESTMENT STRATEGY FOR MAJOR DEFENSE 
ACQUISITION PROGRAMS. 
(a) REPORT REQUIRED.—Not later than May 1, 
2008, the Secretary of Defense shall submit to the con-
545 
gressional defense committees a report on the strategies 
of the Department of Defense for balancing the allocation 
of funds and other resources among major defense acquisi-
tion programs. 
(b) ELEMENTS.—The report required by subsection 
(a) shall address, at a minimum, the ability of the organi-
zations, policies, and procedures of the Department of De-
fense to provide for— 
(1) establishing priorities among needed capa-
bilities under major defense acquisition programs, 
and assessing the resources (including funds, tech-
nologies, time, and personnel) needed to achieve 
such capabilities; 
(2) balancing the cost, schedule, and require-
ments of major defense acquisition programs, includ-
ing those within the same functional or mission area, 
to ensure the most efficient use of resources; and 
(3) ensuring that the budget, requirements, and 
acquisition processes of the Department of Defense 
work in a complementary manner to achieve desired 
results. 
(c) ROLE OF TRI-CHAIR COMMITTEE IN RESOURCE 
ALLOCATION.— 
(1) IN GENERAL.—The report required by sub-
section (a) shall also address the role of the com-
546 
mittee described in paragraph (2) in the resource al-
location process for major defense acquisition pro-
grams. 
(2) COMMITTEE.—The committee described in 
this paragraph is a committee (to be known as the 
‘‘Tri-Chair Committee’’) composed of the following: 
(A) The Under Secretary of Defense for 
Acquisition, Technology, and Logistics, who is 
one of the chairs of the committee. 
(B) The Vice Chairman of the Joint Chiefs 
of Staff, who is one of the chairs of the com-
mittee. 
(C) The Director of Program Analysis and 
Evaluation, who is one of the chairs of the com-
mittee. 
(D) Any other appropriate officials of the 
Department of Defense, as jointly agreed upon 
by the Under Secretary and the Vice Chairman. 
(d) CHANGES IN LAW.—The report required by sub-
section (a) shall, to the maximum extent practicable, in-
clude a discussion of any changes in the budget, acquisi-
tion, and requirements processes of the Department of De-
fense undertaken as a result of changes in law pursuant 
to any section in this Act.
547 
(e) RECOMMENDATIONS.—The report required by 
subsection (a) shall include any recommendations, includ-
ing recommendations for legislative action, that the Sec-
retary considers appropriate to improve the organizations, 
policies, and procedures described in the report. 
SEC. 818. REPORT ON IMPLEMENTATION OF RECOMMENDA-
TIONS ON TOTAL OWNERSHIP COST FOR 
MAJOR WEAPON SYSTEMS. 
(a) REPORT REQUIRED.—Not later than 180 days 
after the date of the enactment of this Act, the Secretary 
of Defense shall submit to the congressional defense com-
mittees a report on the extent of the implementation of 
the recommendations set forth in the February 2003 re-
port of the Government Accountability Office entitled 
‘‘Setting Requirements Differently Could Reduce Weapon 
Systems’ Total Ownership Costs’’. 
(b) ELEMENTS.—The report required by subsection 
(a) shall include the following: 
(1) For each recommendation described in sub-
section (a) that has been implemented, or that the 
Secretary plans to implement— 
(A) a summary of all actions that have 
been taken to implement such recommendation; 
and
548 
(B) a schedule, with specific milestones, 
for completing the implementation of such rec-
ommendation. 
(2) For each recommendation that the Sec-
retary has not implemented and does not plan to im-
plement— 
(A) the reasons for the decision not to im-
plement such recommendation; and 
(B) a summary of any alternative actions 
the Secretary plans to take to address the pur-
poses underlying such recommendation. 
(3) A summary of any additional actions the 
Secretary has taken or plans to take to ensure that 
total ownership cost is appropriately considered in 
the requirements process for major weapon systems. 
Subtitle C—Amendments to Gen-
eral 
Contracting 
Authorities, 
Procedures, and Limitations 
SEC. 821. PLAN FOR RESTRICTING GOVERNMENT-UNIQUE 
CONTRACT CLAUSES ON COMMERCIAL CON-
TRACTS. 
(a) PLAN.—The Under Secretary of Defense for Ac-
quisition, Technology, and Logistics shall develop and im-
plement a plan to minimize the number of government-
549 
unique contract clauses used in commercial contracts by 
restricting the clauses to the following: 
(1) Government-unique clauses authorized by 
law or regulation. 
(2) Any additional clauses that are relevant and 
necessary to a specific contract. 
(b) COMMERCIAL CONTRACT.—In this section: 
(1) The term ‘‘commercial contract’’ means a 
contract awarded by the Federal Government for the 
procurement of a commercial item. 
(2) The term ‘‘commercial item’’ has the mean-
ing provided by section 4(12) of the Office of Fed-
eral Procurement Policy Act (41 U.S.C. 403(12)). 
SEC. 822. EXTENSION OF AUTHORITY FOR USE OF SIM-
PLIFIED 
ACQUISITION 
PROCEDURES 
FOR 
CERTAIN COMMERCIAL ITEMS. 
(a) EXTENSION.—Section 4202(e) of the Clinger- 
Cohen Act of 1996 (division D of Public Law 104–106; 
110 Stat. 652; 10 U.S.C. 2304 note) is amended by strik-
ing ‘‘January 1, 2008’’ and inserting ‘‘January 1, 2010’’. 
(b) REPORT.—Not later than March 1, 2008, the 
Under Secretary of Defense for Acquisition, Technology, 
and Logistics shall submit to the Committees on Armed 
Services of the Senate and the House of Representatives 
a report on the use by the Department of Defense of the
550 
authority provided by section 4202(e) of the Clinger- 
Cohen Act of 1996 (10 U.S.C. 2304 note). The report 
shall include, at a minimum, the following: 
(1) Summary data on the use of the authority. 
(2) Specific examples of the use of the author-
ity. 
(3) An evaluation of potential benefits and costs 
of extending the authority after January 1, 2010. 
SEC. 823. FIVE-YEAR EXTENSION OF AUTHORITY TO CARRY 
OUT CERTAIN PROTOTYPE PROJECTS. 
Section 845(i) of the National Defense Authorization 
Act for Fiscal Year 1994 (10 U.S.C. 2371 note) is amend-
ed by striking ‘‘September 30, 2008’’ and inserting ‘‘Sep-
tember 30, 2013’’. 
SEC. 824. EXEMPTION OF SPECIAL OPERATIONS COMMAND 
FROM CERTAIN REQUIREMENTS FOR CER-
TAIN CONTRACTS RELATING TO VESSELS, 
AIRCRAFT, AND COMBAT VEHICLES. 
Section 2401(b) of title 10, United States Code, is 
amended by adding at the end the following new para-
graph: 
‘‘(5) In the case of a contract described in subsection 
(a)(1)(B), the commander of the special operations com-
mand may make a contract without regard to this sub-
section if—
551 
‘‘(A) funds are available and obligated for the 
full cost of the contract (including termination costs) 
on or before the date the contract is awarded; 
‘‘(B) the Secretary of Defense submits to the 
congressional defense committees a certification that 
there is no alternative for meeting urgent oper-
ational requirements other than making the con-
tract; and 
‘‘(C) a period of 30 days of continuous session 
of Congress has expired following the date on which 
the certification was received by such committees.’’. 
SEC. 825. PROVISION OF AUTHORITY TO MAINTAIN EQUIP-
MENT TO UNIFIED COMBATANT COMMAND 
FOR JOINT WARFIGHTING. 
(a) AUTHORITY.—Section 167a of title 10, United 
States Code, is amended— 
(1) in subsection (a), by striking ‘‘and acquire’’ 
and inserting ‘‘, acquire, and maintain’’; 
(2) by redesignating subsection (f) as sub-
section (g); and 
(3) by inserting after subsection (e) the fol-
lowing new subsection: 
‘‘(f) LIMITATION
ON AUTHORITY TO MAINTAIN 
EQUIPMENT.—The authority delegated under subsection 
(a) to maintain equipment is subject to the availability of
552 
funds authorized and appropriated specifically for that 
purpose.’’. 
(b) TWO-YEAR EXTENSION.—Subsection (g) of such 
section, as so redesignated, is amended— 
(1) by striking ‘‘through 2008’’ and inserting 
‘‘through 2010’’; and 
(2) by striking ‘‘September 30, 2008’’ and in-
serting ‘‘September 30, 2010’’. 
SEC. 826. MARKET RESEARCH. 
(a) ADDITIONAL REQUIREMENTS.—Subsection (c) of 
section 2377 of title 10, United States Code, is amended— 
(1) in paragraph (1)— 
(A) by striking ‘‘and’’ at the end of sub-
paragraph (A); 
(B) by striking the period at the end of 
subparagraph (B) and inserting ‘‘; and’’; and 
(C) by adding at the end the following: 
‘‘(C) before awarding a task order or deliv-
ery order in excess of the simplified acquisition 
threshold.’’; and 
(2) by adding at the end the following: 
‘‘(4) The head of an agency shall take appropriate 
steps to ensure that any prime contractor of a contract 
(or task order or delivery order) in an amount in excess 
of $5,000,000 for the procurement of items other than
553 
commercial items engages in such market research as may 
be necessary to carry out the requirements of subsection 
(b)(2) before making purchases for or on behalf of the 
Department of Defense.’’. 
(b) REQUIREMENT TO DEVELOP TRAINING
AND 
TOOLS.—The Secretary of Defense shall develop training 
to assist contracting officers, and market research tools 
to assist such officers and prime contractors, in per-
forming appropriate market research as required by sub-
section (c) of section 2377 of title 10, United States Code, 
as amended by this section. 
SEC. 827. MODIFICATION OF COMPETITION REQUIRE-
MENTS FOR PURCHASES FROM FEDERAL 
PRISON INDUSTRIES. 
(a) MODIFICATION
OF
COMPETITION
REQUIRE-
MENTS.— 
(1) IN GENERAL.—Section 2410n of title 10, 
United States Code, is amended by striking sub-
sections (a) and (b) and inserting the following new 
subsections (a) and (b): 
‘‘(a) PRODUCTS FOR WHICH FEDERAL PRISON IN-
DUSTRIES
DOES
NOT
HAVE
SIGNIFICANT
MARKET 
SHARE.—(1) Before purchasing a product listed in the 
latest edition of the Federal Prison Industries catalog 
under section 4124(d) of title 18 for which Federal Prison
554 
Industries does not have a significant market share, the 
Secretary of Defense shall conduct market research to de-
termine whether the product is comparable to products 
available from the private sector that best meet the needs 
of the Department in terms of price, quality, and time of 
delivery. 
‘‘(2) If the Secretary determines that a Federal Pris-
on Industries product described in paragraph (1) is not 
comparable in price, quality, or time of delivery to prod-
ucts of the private sector that best meets the needs of the 
Department in terms of price, quality, and time of deliv-
ery, the Secretary shall use competitive procedures for the 
procurement of the product, or shall make an individual 
purchase under a multiple award contract in accordance 
with the competition requirements applicable to such con-
tract. In conducting such a competition, the Secretary 
shall consider a timely offer from Federal Prison Indus-
tries. 
‘‘(b) PRODUCTS FOR WHICH FEDERAL PRISON IN-
DUSTRIES HAS SIGNIFICANT MARKET SHARE.—(1) The 
Secretary of Defense may purchase a product listed in the 
latest edition of the Federal Prison Industries catalog for 
which Federal Prison Industries has a significant market 
share only if the Secretary uses competitive procedures for 
the procurement of the product or makes an individual
555 
purchase under a multiple award contract in accordance 
with the competition requirements applicable to such con-
tract. In conducting such a competition, the Secretary 
shall consider a timely offer from Federal Prison Indus-
tries. 
‘‘(2) For purposes of this subsection, Federal Prison 
Industries shall be treated as having a significant share 
of the market for a product if the Secretary, in consulta-
tion with the Administrator of Federal Procurement Pol-
icy, determines that the Federal Prison Industries share 
of the Department of Defense market for the category of 
products including such product is greater than 5 per-
cent.’’. 
(2) EFFECTIVE DATE.—The amendment made 
by subsection (a) shall take effect 60 days after the 
date of the enactment of this Act. 
(b) LIST OF PRODUCTS FOR WHICH FEDERAL PRIS-
ON INDUSTRIES HAS SIGNIFICANT MARKET SHARE.— 
(1) INITIAL LIST.—Not later than 60 days after 
the date of the enactment of this Act, the Secretary 
of Defense shall publish a list of product categories 
for which Federal Prison Industries’ share of the 
Department of Defense market is greater than 5 
percent, based on the most recent fiscal year for 
which data is available.
556 
(2) MODIFICATION.—The Secretary may modify 
the list published under paragraph (1) at any time 
if the Secretary determines that new data require 
adding a product category to the list or omitting a 
product category from the list. 
(3) CONSULTATION.—The Secretary shall carry 
out this subsection in consultation with the Adminis-
trator for Federal Procurement Policy. 
SEC. 828. MULTIYEAR CONTRACT AUTHORITY FOR ELEC-
TRICITY 
FROM 
RENEWABLE 
ENERGY 
SOURCES. 
(a) MULTIYEAR CONTRACT AUTHORITY.—Chapter 
141 of title 10, United States Code, is amended by adding 
at the end the following new section: 
‘‘§ 2410q. Multiyear contracts: purchase of electricity 
from renewable energy sources 
‘‘(a) MULTIYEAR CONTRACTS AUTHORIZED.—Sub-
ject to subsection (b), the Secretary of Defense may enter 
into a contract for a period not to exceed 10 years for 
the purchase of electricity from sources of renewable en-
ergy, as that term is defined in section 203(b)(2) of the 
Energy Policy Act of 2005 (42 U.S.C. 15852(b)(2)). 
‘‘(b) LIMITATIONS ON CONTRACTS FOR PERIODS IN 
EXCESS OF FIVE YEARS.—The Secretary may exercise 
the authority in subsection (a) to enter into a contract
557 
for a period in excess of five years only if the Secretary 
determines, on the basis of a business case analysis pre-
pared by the Department of Defense, that— 
‘‘(1) the proposed purchase of electricity under 
such contract is cost effective for the Department of 
Defense; and 
‘‘(2) it would not be possible to purchase elec-
tricity from the source in an economical manner 
without the use of a contract for a period in excess 
of five years. 
‘‘(c) RELATIONSHIP TO OTHER MULTIYEAR CON-
TRACTING AUTHORITY.—Nothing in this section shall be 
construed to preclude the Department of Defense from 
using other multiyear contracting authority of the Depart-
ment to purchase renewable energy.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
at the beginning of chapter 141 of such title is amended 
by adding at the end the following new item: 
‘‘2410q. Multiyear contracts: purchase of electricity from renewable energy 
sources.’’. 
SEC. 829. PROCUREMENT OF FIRE RESISTANT RAYON 
FIBER FOR THE PRODUCTION OF UNIFORMS 
FROM FOREIGN SOURCES. 
(a) AUTHORITY TO PROCURE.—The Secretary of De-
fense may procure fire resistant rayon fiber for the pro-
duction of uniforms that is manufactured in a foreign
558 
country referred to in subsection (d) if the Secretary de-
termines either of the following: 
(1) That fire resistant rayon fiber for the pro-
duction of uniforms is not available from sources 
within the national technology and industrial base. 
(2) That— 
(A) procuring fire resistant rayon fiber 
manufactured from suppliers within the na-
tional technology and industrial base would re-
sult in sole-source contracts or subcontracts for 
the supply of fire resistant rayon fiber; and 
(B) such sole-source contracts or sub-
contracts would not be in the best interests of 
the Government or consistent with the objec-
tives of section 2304 of title 10, United States 
Code. 
(b) SUBMISSION TO CONGRESS.—Not later than 30 
days after making a determination under subsection (a), 
the Secretary shall submit to Congress a copy of the deter-
mination. 
(c) APPLICABILITY
TO SUBCONTRACTS.—The au-
thority under subsection (a) applies with respect to sub-
contracts under Department of Defense contracts as well 
as to such contracts.
559 
(d) FOREIGN COUNTRIES COVERED.—The authority 
under subsection (a) applies with respect to a foreign 
country that— 
(1) is a party to a defense memorandum of un-
derstanding entered into under section 2531 of title 
10, United States Code; and 
(2) does not discriminate against defense items 
produced in the United States to a greater degree 
than the United States discriminates against defense 
items produced in that country. 
(e) NATIONAL TECHNOLOGY AND INDUSTRIAL BASE 
DEFINED.—In this section, the term ‘‘national technology 
and industrial base’’ has the meaning given that term in 
section 2500 of title 10, United States Code. 
(f) SUNSET.—The authority under subsection (a) 
shall expire on the date that is five years after the date 
of the enactment of this Act. 
SEC. 830. COMPTROLLER GENERAL REVIEW OF NON-
COMPETITIVE AWARDS OF CONGRESSIONAL 
AND EXECUTIVE BRANCH INTEREST ITEMS. 
Not later than one year after the date of the enact-
ment of this Act, the Comptroller General of the United 
States shall submit to the congressional defense commit-
tees a report on the use of procedures other than competi-
tive procedures in the award of contracts by the Depart-
560 
ment of Defense. The report shall compare the procedures 
used by the Department of Defense for the award of funds 
for new projects pursuant to congressionally directed 
spending items, as defined in rule XLIV of the Standing 
Rules of the Senate, or congressional earmarks, as defined 
in rule XXI of the Rules of the House of Representatives, 
with the procedures used by the Department of Defense 
for the award of funds for new projects of special interest 
to senior executive branch officials. 
Subtitle D—Accountability in 
Contracting 
SEC. 841. COMMISSION ON WARTIME CONTRACTING IN 
IRAQ AND AFGHANISTAN. 
(a) ESTABLISHMENT.—There is hereby established a 
commission to be known as the ‘‘Commission on Wartime 
Contracting’’ (in this section referred to as the ‘‘Commis-
sion’’). 
(b) MEMBERSHIP MATTERS.— 
(1) MEMBERSHIP.—The Commission shall be 
composed of 8 members, as follows: 
(A) 2 members shall be appointed by the 
majority leader of the Senate, in consultation 
with the Chairmen of the Committee on Armed 
Services, the Committee on Homeland Security
561 
and Governmental Affairs, and the Committee 
on Foreign Relations of the Senate. 
(B) 2 members shall be appointed by the 
Speaker of the House of Representatives, in 
consultation with the Chairmen of the Com-
mittee on Armed Services, the Committee on 
Oversight and Government Reform, and the 
Committee on Foreign Affairs of the House of 
Representatives. 
(C) 1 member shall be appointed by the 
minority leader of the Senate, in consultation 
with the Ranking Minority Members of the 
Committee on Armed Services, the Committee 
on Homeland Security and Governmental Af-
fairs, and the Committee on Foreign Relations 
of the Senate. 
(D) 1 member shall be appointed by the 
minority leader of the House of Representa-
tives, in consultation with the Ranking Minority 
Member of the Committee on Armed Services, 
the Committee on Oversight and Government 
Reform, and the Committee on Foreign Affairs 
of the House of Representatives.
562 
(E) 2 members shall be appointed by the 
President, in consultation with the Secretary of 
Defense and the Secretary of State. 
(2) DEADLINE
FOR
APPOINTMENTS.—All ap-
pointments to the Commission shall be made not 
later than 120 days after the date of the enactment 
of this Act. 
(3) CO-CHAIRMEN.—The Commission shall have 
two co-chairmen, including— 
(A) a co-chairman who shall be a member 
of the Commission jointly designated by the 
Speaker of the House of Representatives and 
the majority leader of the Senate; and 
(B) a co-chairman who shall be a member 
of the Commission jointly designated by the mi-
nority leader of the House of Representatives 
and the minority leader of the Senate. 
(4) VACANCY.—In the event of a vacancy in a 
seat on the Commission, the individual appointed to 
fill the vacant seat shall be— 
(A) appointed by the same officer (or the 
officer’s successor) who made the appointment 
to the seat when the Commission was first es-
tablished; and
563 
(B) if the officer in subparagraph (A) is of 
a party other than the party of the officer who 
made the appointment to the seat when the 
Commission was first established, chosen in 
consultation with the senior officers in the Sen-
ate and the House of Representatives of the 
party which is the party of the officer who 
made the appointment to the seat when the 
Commission was first established. 
(c) DUTIES.— 
(1) GENERAL DUTIES.—The Commission shall 
study the following matters: 
(A) Federal agency contracting for the re-
construction of Iraq and Afghanistan. 
(B) Federal agency contracting for the 
logistical support of coalition forces operating in 
Iraq and Afghanistan. 
(C) Federal agency contracting for the per-
formance of security functions in Iraq and Af-
ghanistan. 
(2) SCOPE OF CONTRACTING COVERED.—The 
Federal agency contracting covered by this sub-
section includes contracts entered into both in the 
United States and abroad for the performance of ac-
tivities described in paragraph (1).
564 
(3) PARTICULAR DUTIES.—In carrying out the 
study under this subsection, the Commission shall 
assess— 
(A) the extent of the reliance of the Fed-
eral Government on contractors to perform 
functions (including security functions) in Iraq 
and Afghanistan and the impact of this reliance 
on the achievement of the objectives of the 
United States; 
(B) the performance exhibited by Federal 
contractors for the contracts under review pur-
suant to paragraph (1), and the mechanisms 
used to evaluate contractor performance; 
(C) the extent of waste, fraud, and abuse 
under such contracts; 
(D) the extent to which those responsible 
for such waste, fraud, and abuse have been held 
financially or legally accountable; 
(E) the appropriateness of the organiza-
tional structure, policies, practices, and re-
sources of the Department of Defense and the 
Department of State for handling program 
management and contracting for the programs 
and contracts under review pursuant to para-
graph (1);
565 
(F) the extent to which contractors under 
such contracts have engaged in the misuse of 
force or have used force in a manner incon-
sistent with the objectives of the operational 
field commander; and 
(G) the extent of potential violations of the 
laws of war, Federal law, or other applicable 
legal standards by contractors under such con-
tracts. 
(d) REPORTS.— 
(1) INTERIM REPORT.—On March 1, 2009, the 
Commission shall submit to Congress an interim re-
port on the study carried out under subsection (c), 
including the results and findings of the study as of 
that date. 
(2) OTHER
REPORTS.—The Commission may 
from time to time submit to Congress such other re-
ports on the study carried out under subsection (c) 
as the Commission considers appropriate. 
(3) FINAL REPORT.—Not later than two years 
after the date of the appointment of all of the mem-
bers of the Commission under subsection (b), the 
Commission shall submit to Congress a final report 
on the study carried out under subsection (c). The 
report shall—
566 
(A) include the findings of the Commis-
sion; 
(B) identify lessons learned relating to 
contingency program management and contin-
gency contracting covered by the study; and 
(C) include specific recommendations for 
improvements to be made in— 
(i) the process for defining require-
ments and developing statements of work 
for contracts in contingency contracting; 
(ii) the process for awarding contracts 
and task or delivery orders in contingency 
contracting; 
(iii) the process for contingency pro-
gram management; 
(iv) the process for identifying, ad-
dressing, and providing accountability for 
waste, fraud, and abuse in contingency 
contracting; 
(v) the process for determining which 
functions are inherently governmental and 
which functions are appropriate for per-
formance by contractors in a contingency 
operation (including during combat oper-
ations), especially whether providing secu-
567 
rity in an area of combat operations is in-
herently governmental; 
(vi) the organizational structure, re-
sources, policies, and practices of the De-
partment of Defense and the Department 
of State for performing contingency pro-
gram management; and 
(vii) the process by which roles and 
responsibilities with respect to manage-
ment and oversight of contracts in contin-
gency contracting are distributed among 
the various departments and agencies of 
the Federal Government, and interagency 
coordination and communication mecha-
nisms associated with contingency con-
tracting. 
(e) OTHER POWERS AND AUTHORITIES.— 
(1) HEARINGS AND EVIDENCE.—The Commis-
sion or, on the authority of the Commission, any 
portion thereof, may, for the purpose of carrying out 
this section— 
(A) hold such hearings and sit and act at 
such times and places, take such testimony, re-
ceive such evidence, administer such oaths (pro-
568 
vided that the quorum for a hearing shall be 
three members of the Commission); and 
(B) provide for the attendance and testi-
mony of such witnesses and the production of 
such books, records, correspondence, memo-
randa, papers, and documents; 
as the Commission, or such portion thereof, may de-
termine advisable. 
(2) INABILITY TO OBTAIN DOCUMENTS OR TES-
TIMONY.—In the event the Commission is unable to 
obtain testimony or documents needed to conduct its 
work, the Commission shall notify the committees of 
Congress of jurisdiction and appropriate investiga-
tive authorities. 
(3) ACCESS TO INFORMATION.—The Commis-
sion may secure directly from the Department of 
Defense and any other department or agency of the 
Federal Government any information or assistance 
that the Commission considers necessary to enable 
the Commission to carry out the requirements of 
this section. Upon request of the Commission, the 
head of such department or agency shall furnish 
such information expeditiously to the Commission. 
Whenever information or assistance requested by the 
Commission is unreasonably refused or not provided,
570 
(A) REFERRAL TO ATTORNEY GENERAL.— 
The Commission may refer to the Attorney 
General any violation or potential violation of 
law identified by the Commission in carrying 
out its duties under this section. 
(B) REPORTS
ON
RESULTS
OF
REFER-
RAL.—The Attorney General shall submit to 
Congress a report on each prosecution, convic-
tion, resolution, or other disposition that results 
from a referral made under this subparagraph. 
(f) TERMINATION.—The Commission shall terminate 
on the date that is 60 days after the date of the submittal 
of its final report under subsection (d)(3). 
(g) DEFINITIONS.—In this section: 
(1) CONTINGENCY
CONTRACTING.—The term 
‘‘contingency contracting’’ means all stages of the 
process of acquiring property or services during a 
contingency operation. 
(2) 
CONTINGENCY
OPERATION.—The 
term 
‘‘contingency operation’’ has the meaning given that 
term in section 101 of title 10, United States Code. 
(3) CONTINGENCY PROGRAM MANAGEMENT.— 
The term ‘‘contingency program management’’ 
means the process of planning, organizing, staffing, 
controlling, and leading the combined efforts of par-
571 
ticipating personnel for the management of a spe-
cific acquisition program or programs during contin-
gency operations. 
SEC. 842. INVESTIGATION OF WASTE, FRAUD, AND ABUSE 
IN WARTIME CONTRACTS AND CONTRACTING 
PROCESSES IN IRAQ AND AFGHANISTAN. 
(a) AUDITS REQUIRED.—Thorough audits shall be 
performed in accordance with this section to identify po-
tential waste, fraud, and abuse in the performance of— 
(1) Department of Defense contracts, sub-
contracts, and task and delivery orders for the 
logistical support of coalition forces in Iraq and Af-
ghanistan; and 
(2) Federal agency contracts, subcontracts, and 
task and delivery orders for the performance of secu-
rity and reconstruction functions in Iraq and Af-
ghanistan. 
(b) AUDIT PLANS.— 
(1) The Department of Defense Inspector Gen-
eral shall develop a comprehensive plan for a series 
of audits of contracts, subcontracts, and task and 
delivery orders covered by subsection (a)(1), con-
sistent with the requirements of subsection (g), in 
consultation with other Inspectors General specified 
in subsection (c) with regard to any contracts, sub-
572 
contracts, or task or delivery orders over which such 
Inspectors General have jurisdiction. 
(2) The Special Inspector General for Iraq Re-
construction shall develop a comprehensive plan for 
a series of audits of contracts, subcontracts, and 
task and delivery orders covered by subsection (a)(2) 
relating to Iraq, consistent with the requirements of 
subsection (h), in consultation with other Inspectors 
General specified in subsection (c) with regard to 
any contracts, subcontracts, or task or delivery or-
ders over which such Inspectors General have juris-
diction. 
(3) The Special Inspector General for Afghani-
stan Reconstruction shall develop a comprehensive 
plan for a series of audits of contracts, subcontracts, 
and task and delivery orders covered by subsection 
(a)(2) relating to Afghanistan, consistent with the 
requirements of subsection (h), in consultation with 
other Inspectors General specified in subsection (c) 
with regard to any contracts, subcontracts, or task 
or delivery orders over which such Inspectors Gen-
eral have jurisdiction. 
(c) PERFORMANCE OF AUDITS BY CERTAIN INSPEC-
TORS GENERAL.—The Special Inspector General for Iraq 
Reconstruction, during such period as such office exists,
573 
the Special Inspector General for Afghanistan Reconstruc-
tion, during such period as such office exists, the Inspector 
General of the Department of Defense, the Inspector Gen-
eral of the Department of State, and the Inspector Gen-
eral of the United States Agency for International Devel-
opment shall perform such audits as required by sub-
section (a) and identified in the audit plans developed pur-
suant to subsection (b) as fall within the respective scope 
of their duties as specified in law. 
(d) COORDINATION
OF AUDITS.—The Inspectors 
General specified in subsection (c) shall work to coordinate 
the performance of the audits required by subsection (a) 
and identified in the audit plans developed under sub-
section (b) including through councils and working groups 
composed of such Inspectors General. 
(e) JOINT AUDITS.—If one or more audits required 
by subsection (a) and identified in an audit plan developed 
under subsection (b) falls within the scope of the duties 
of more than one of the Inspectors General specified in 
subsection (c), and such Inspectors General agree that 
such audit or audits are best pursued jointly, such Inspec-
tors General shall enter into a memorandum of under-
standing relating to the performance of such audit or au-
dits.
574 
(f) SEPARATE AUDITS.—If one or more audits re-
quired by subsection (a) and identified in an audit plan 
developed under subsection (b) falls within the scope of 
the duties of more than one of the Inspectors General 
specified in subsection (c), and such Inspectors General 
do not agree that such audit or audits are best pursued 
jointly, such audit or audits shall be separately performed 
by one or more of the Inspectors General concerned. 
(g) SCOPE OF AUDITS OF CONTRACTS.—Audits con-
ducted pursuant to subsection (a)(1) shall examine, at a 
minimum, one or more of the following issues: 
(1) The manner in which contract requirements 
were developed. 
(2) The procedures under which contracts or 
task or delivery orders were awarded. 
(3) The terms and conditions of contracts or 
task or delivery orders. 
(4) The staffing and method of performance of 
contractors, including cost controls. 
(5) The efficacy of Department of Defense 
management and oversight, including the adequacy 
of staffing and training of officials responsible for 
such management and oversight.
575 
(6) The flow of information from contractors to 
officials responsible for contract management and 
oversight. 
(h) SCOPE OF AUDITS OF OTHER CONTRACTS.—Au-
dits conducted pursuant to subsection (a)(2) shall exam-
ine, at a minimum, one or more of the following issues: 
(1) The manner in which contract requirements 
were developed and contracts or task and delivery 
orders were awarded. 
(2) The manner in which the Federal agency 
exercised control over the performance of contrac-
tors. 
(3) The extent to which operational field com-
manders were able to coordinate or direct the per-
formance of contractors in an area of combat oper-
ations. 
(4) The degree to which contractor employees 
were properly screened, selected, trained, and 
equipped for the functions to be performed. 
(5) The nature and extent of any incidents of 
misconduct or unlawful activity by contractor em-
ployees. 
(6) The nature and extent of any activity by 
contractor employees that was inconsistent with the 
objectives of operational field commanders.
576 
(7) The extent to which any incidents of mis-
conduct or unlawful activity were reported, docu-
mented, investigated, and (where appropriate) pros-
ecuted. 
(i) INDEPENDENT
CONDUCT
OF
AUDIT
FUNC-
TIONS.—All audit functions under this section, including 
audit planning and coordination, shall be performed by the 
relevant Inspectors General in an independent manner, 
without consultation with the Commission established pur-
suant to section 841 of this Act. All audit reports resulting 
from such audits shall be available to the Commission. 
SEC. 843. ENHANCED COMPETITION REQUIREMENTS FOR 
TASK AND DELIVERY ORDER CONTRACTS. 
(a) DEFENSE CONTRACTS.— 
(1) LIMITATION
ON
SINGLE
AWARD
CON-
TRACTS.—Section 2304a(d) of title 10, United 
States Code, is amended— 
(A) by redesignating paragraph (3) as 
paragraph (4); and 
(B) by inserting after paragraph (2) the 
following new paragraph (3): 
‘‘(3)(A) No task or delivery order contract in an 
amount estimated to exceed $100,000,000 (including all 
options) may be awarded to a single source unless the 
head of the agency determines in writing that—
577 
‘‘(i) the task or delivery orders expected under 
the contract are so integrally related that only a sin-
gle source can reasonably perform the work; 
‘‘(ii) the contract provides only for firm, fixed 
price task orders or delivery orders for— 
‘‘(I) products for which unit prices are es-
tablished in the contract; or 
‘‘(II) services for which prices are estab-
lished in the contract for the specific tasks to 
be performed; 
‘‘(iii) only one source is qualified and capable of 
performing the work at a reasonable price to the 
government; or 
‘‘(iv) because of exceptional circumstances, it is 
necessary in the public interest to award the con-
tract to a single source. 
‘‘(B) The head of the agency shall notify Congress 
within 30 days after any determination under subpara-
graph (A)(iv).’’. 
(2) ENHANCED COMPETITION FOR ORDERS IN 
EXCESS OF $5,000,000.—Section 2304c of such title 
is amended— 
(A) by redesignating subsections (d), (e), 
and (f) as subsections (e), (f), and (g), respec-
tively;
578 
(B) by inserting after subsection (c) the 
following new subsection (d): 
‘‘(d) ENHANCED COMPETITION FOR ORDERS IN EX-
CESS OF $5,000,000.—In the case of a task or delivery 
order in excess of $5,000,000, the requirement to provide 
all contractors a fair opportunity to be considered under 
subsection (b) is not met unless all such contractors are 
provided, at a minimum— 
‘‘(1) a notice of the task or delivery order that 
includes a clear statement of the agency’s require-
ments; 
‘‘(2) a reasonable period of time to provide a 
proposal in response to the notice; 
‘‘(3) disclosure of the significant factors and 
subfactors, including cost or price, that the agency 
expects to consider in evaluating such proposals, and 
their relative importance; 
‘‘(4) in the case of an award that is to be made 
on a best value basis, a written statement docu-
menting the basis for the award and the relative im-
portance of quality and price or cost factors; and 
‘‘(5) an opportunity for a post-award debriefing 
consistent 
with 
the 
requirements 
of 
section 
2305(b)(5) of this title.’’; and
579 
(C) by striking subsection (e), as redesig-
nated by paragraph (1), and inserting the fol-
lowing new subsection (e): 
‘‘(e) PROTESTS.—(1) A protest is not authorized in 
connection with the issuance or proposed issuance of a 
task or delivery order except for— 
‘‘(A) a protest on the ground that the order in-
creases the scope, period, or maximum value of the 
contract under which the order is issued; or 
‘‘(B) a protest of an order valued in excess of 
$10,000,000. 
‘‘(2) Notwithstanding section 3556 of title 31, the 
Comptroller General of the United States shall have exclu-
sive jurisdiction of a protest authorized under paragraph 
(1)(B). 
‘‘(3) This subsection shall be in effect for three years, 
beginning on the date that is 120 days after the date of 
the enactment of the National Defense Authorization Act 
for Fiscal Year 2008.’’. 
(3) EFFECTIVE DATES.— 
(A) SINGLE
AWARD
CONTRACTS.—The 
amendments made by paragraph (1) shall take 
effect on the date that is 120 days after the 
date of the enactment of this Act, and shall
580 
apply with respect to any contract awarded on 
or after such date. 
(B) ORDERS IN EXCESS OF $5,000,000.— 
The amendments made by paragraph (2) shall 
take effect on the date that is 120 days after 
the date of the enactment of this Act, and shall 
apply with respect to any task or delivery order 
awarded on or after such date. 
(b) CIVILIAN AGENCY CONTRACTS.— 
(1) LIMITATION
ON
SINGLE
AWARD
CON-
TRACTS.—Section 303H(d) of the Federal Property 
and Administrative Services Act of 1949 (41 U.S.C. 
253h(d)) is amended— 
(A) by redesignating paragraph (3) as 
paragraph (4); and 
(B) by inserting after paragraph (2) the 
following new paragraph (3): 
‘‘(3)(A) No task or delivery order contract in an 
amount estimated to exceed $100,000,000 (including all 
options) may be awarded to a single source unless the 
head of the executive agency determines in writing that— 
‘‘(i) the task or delivery orders expected under 
the contract are so integrally related that only a sin-
gle source can reasonably perform the work;
581 
‘‘(ii) the contract provides only for firm, fixed 
price task orders or delivery orders for— 
‘‘(I) products for which unit prices are es-
tablished in the contract; or 
‘‘(II) services for which prices are estab-
lished in the contract for the specific tasks to 
be performed; 
‘‘(iii) only one source is qualified and capable of 
performing the work at a reasonable price to the 
government; or 
‘‘(iv) because of exceptional circumstances, it is 
necessary in the public interest to award the con-
tract to a single source. 
‘‘(B) The head of the executive agency shall notify 
Congress within 30 days after any determination under 
subparagraph (A)(iv).’’. 
(2) ENHANCED COMPETITION FOR ORDERS IN 
EXCESS OF $5,000,000.—Section 303J of such Act 
(41 U.S.C. 253j) is amended— 
(A) by redesignating subsections (d), (e), 
and (f) as subsections (e), (f), and (g), respec-
tively; 
(B) by inserting after subsection (c) the 
following new subsection (d):
582 
‘‘(d) ENHANCED COMPETITION FOR ORDERS IN EX-
CESS OF $5,000,000.—In the case of a task or delivery 
order in excess of $5,000,000, the requirement to provide 
all contractors a fair opportunity to be considered under 
subsection (b) is not met unless all such contractors are 
provided, at a minimum— 
‘‘(1) a notice of the task or delivery order that 
includes a clear statement of the executive agency’s 
requirements; 
‘‘(2) a reasonable period of time to provide a 
proposal in response to the notice; 
‘‘(3) disclosure of the significant factors and 
subfactors, including cost or price, that the executive 
agency expects to consider in evaluating such pro-
posals, and their relative importance; 
‘‘(4) in the case of an award that is to be made 
on a best value basis, a written statement docu-
menting the basis for the award and the relative im-
portance of quality and price or cost factors; and 
‘‘(5) an opportunity for a post-award debriefing 
consistent 
with 
the 
requirements 
of 
section 
303B(e).’’; and 
(C) by striking subsection (e), as redesig-
nated by paragraph (1), and inserting the fol-
lowing new subsection (e):
583 
‘‘(e) PROTESTS.—(1) A protest is not authorized in 
connection with the issuance or proposed issuance of a 
task or delivery order except for— 
‘‘(A) a protest on the ground that the order in-
creases the scope, period, or maximum value of the 
contract under which the order is issued; or 
‘‘(B) a protest of an order valued in excess of 
$10,000,000. 
‘‘(2) Notwithstanding section 3556 of title 31, United 
States Code, the Comptroller General of the United States 
shall have exclusive jurisdiction of a protest authorized 
under paragraph (1)(B). 
‘‘(3) This subsection shall be in effect for three years, 
beginning on the date that is 120 days after the date of 
the enactment of the National Defense Authorization Act 
for Fiscal Year 2008.’’. 
(3) EFFECTIVE DATES.— 
(A) SINGLE
AWARD
CONTRACTS.—The 
amendments made by paragraph (1) shall take 
effect on the date that is 120 days after the 
date of the enactment of this Act, and shall 
apply with respect to any contract awarded on 
or after such date. 
(B) ORDERS IN EXCESS OF $5,000,000.— 
The amendments made by paragraph (2) shall
584 
take effect on the date that is 120 days after 
the date of the enactment of this Act, and shall 
apply with respect to any task or delivery order 
awarded on or after such date. 
SEC. 844. PUBLIC DISCLOSURE OF JUSTIFICATION AND AP-
PROVAL DOCUMENTS FOR NONCOMPETITIVE 
CONTRACTS. 
(a) CIVILIAN AGENCY CONTRACTS.— 
(1) IN GENERAL.—Section 303 of the Federal 
Property and Administrative Services Act of 1949 
(41 U.S.C. 253) is amended by adding at the end 
the following new subsection: 
‘‘(j)(1)(A) Except as provided in subparagraph (B), 
in the case of a procurement permitted by subsection (c), 
the head of an executive agency shall make publicly avail-
able, within 14 days after the award of the contract, the 
documents containing the justification and approval re-
quired by subsection (f)(1) with respect to the procure-
ment. 
‘‘(B) In the case of a procurement permitted by sub-
section (c)(2), subparagraph (A) shall be applied by sub-
stituting ‘30 days’ for ‘14 days’. 
‘‘(2) The documents shall be made available on the 
website of the agency and through a government-wide
585 
website selected by the Administrator for Federal Procure-
ment Policy. 
‘‘(3) This subsection does not require the public avail-
ability of information that is exempt from public disclosure 
under section 552(b) of title 5, United States Code.’’. 
(2) CONFORMING AMENDMENT.—Section 303(f) 
of such Act is amended— 
(A) by striking paragraph (4); and 
(B) by redesignating paragraph (5) as 
paragraph (4). 
(b) DEFENSE AGENCY CONTRACTS.— 
(1) IN
GENERAL.—Section 2304 of title 10, 
United States Code, is amended by adding at the 
end the following new subsection: 
‘‘(l)(1)(A) Except as provided in subparagraph (B), 
in the case of a procurement permitted by subsection (c), 
the head of an agency shall make publicly available, within 
14 days after the award of the contract, the documents 
containing the justification and approval required by sub-
section (f)(1) with respect to the procurement. 
‘‘(B) In the case of a procurement permitted by sub-
section (c)(2), subparagraph (A) shall be applied by sub-
stituting ‘30 days’ for ‘14 days’. 
‘‘(2) The documents shall be made available on the 
website of the agency and through a government-wide
586 
website selected by the Administrator for Federal Procure-
ment Policy. 
‘‘(3) This subsection does not require the public avail-
ability of information that is exempt from public disclosure 
under section 552(b) of title 5.’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
2304(f) of such title is amended— 
(A) by striking paragraph (4); and 
(B) by redesignating paragraphs (5) and 
(6) as paragraphs (4) and (5), respectively. 
SEC. 845. DISCLOSURE OF GOVERNMENT CONTRACTOR 
AUDIT FINDINGS. 
(a) REQUIRED ANNEX ON SIGNIFICANT AUDIT FIND-
INGS.— 
(1) IN GENERAL.—Each Inspector General ap-
pointed under the Inspector General Act of 1978 
shall submit, as part of the semiannual report sub-
mitted to Congress pursuant to section 5 of such 
Act, an annex on final, completed contract audit re-
ports issued to the contracting activity containing 
significant audit findings issued during the period 
covered by the semiannual report concerned. 
(2) ELEMENTS.—Such annex shall include— 
(A) a list of such contract audit reports;
587 
(B) for each audit report, a brief descrip-
tion of the nature of the significant audit find-
ings in the report; and 
(C) for each audit report, the specific 
amounts of costs identified as unsupported, 
questioned, or disallowed. 
(3) INFORMATION EXEMPT FROM PUBLIC DIS-
CLOSURE.—(A) Nothing in this subsection shall be 
construed to require the release of information to 
the public that is exempt from public disclosure 
under section 552(b) of title 5, United States Code. 
(B) For each element required by paragraph 
(2), the Inspector General concerned shall note each 
instance where information has been redacted in ac-
cordance with the requirements of section 552(b) of 
title 5, United States Code, and submit an 
unredacted annex to the committees listed in sub-
section (d)(2) within 7 days after the issuance of the 
semiannual report. 
(b) DEFENSE
CONTRACT
AUDIT
AGENCY
IN-
CLUDED.—For purposes of subsection (a), audits of the 
Defense Contract Audit Agency shall be included in the 
annex provided by the Inspector General of the Depart-
ment of Defense if they include significant audit findings.
595 
(3) WRITTEN
OPINION.—Not later than 30 
days after receiving a request by an official or 
former official of the Department of Defense de-
scribed in subsection (c), the appropriate ethics 
counselor shall provide such official or former offi-
cial a written opinion regarding the applicability or 
inapplicability of post-employment restrictions to ac-
tivities that the official or former official may under-
take on behalf of a contractor. 
(4) CONTRACTOR
REQUIREMENT.—A Depart-
ment of Defense contractor may not knowingly pro-
vide compensation to a former Department of De-
fense official described in subsection (c) within two 
years after such former official leaves service in the 
Department of Defense, without first determining 
that the former official has sought and received (or 
has not received after 30 days of seeking) a written 
opinion from the appropriate ethics counselor re-
garding the applicability of post-employment restric-
tions to the activities that the former official is ex-
pected to undertake on behalf of the contractor. 
(5) ADMINISTRATIVE
ACTIONS.—In the event 
that an official or former official of the Department 
of Defense described in subsection (c), or a Depart-
ment of Defense contractor, knowingly fails to com-