head of the agency shall consider them in evaluating the
offeror’s price.
‘‘(B) The proposals that the head of an agency is to
consider requiring in a solicitation for the award of a de-
velopment contract are the following:
‘‘(i) Proposals to incorporate in the design of
the major system items which are currently available
within the supply system of the Federal agency re-
sponsible for the major system, available elsewhere
in the national supply system, or commercially avail-
able from more than one source.
‘‘(ii) With respect to items that are likely to be
required in substantial quantities during the sys-
tem’s service life, proposals to incorporate in the de-
sign of the major system items which the United
States will be able to acquire competitively in the fu-
ture.
‘‘(2)(A) In preparing a solicitation for the award of
a production contract for a major system, the head of an
agency shall consider requiring in the solicitation that an
offeror include in its offer proposals described in subpara-
graph (B). In determining whether to require such propos-
als, the head of the agency shall give due consideration
to the purposes for which the system is being procured
and the technology necessary to meet the system’s re-
quired capabilities. If such proposals are required, the
head of the agency shall consider them in evaluating the
offeror’s price.
‘‘(B) The proposals that the head of an agency is to
consider requiring in a solicitation for the award of a pro-
duction contract are proposals identifying opportunities to
ensure that the United States will be able to obtain on
a competitive basis items procured in connection with the
system that are likely to be reprocured in substantial
quantities during the service life of the system. Proposals
submitted in response to such requirement may include
the following:
‘‘(i) Proposals to provide to the United States
the right to use technical data to be provided under
the contract for competitive reprocurement of the
item, together with cost to the United States, if any,
of acquiring such technical data and the right to use
such data.
‘‘(ii) Proposals for the qualification or develop-
ment of multiple sources of supply for the item.
‘‘(3) If the head of an agency is making a non-
competitive award of a development contract or a produc-
tion contract for a major system, the factors specified in
paragraphs (1) and (2) to be considered in evaluating an
offer for a contract may be considered as objectives in ne-
gotiating the contract to be awarded.’’.
(c) APPLICABILITY.—
(1) IN GENERAL.—Except as provided in para-
graph (2), sections 30 and 31 of the Office of Fed-
eral Procurement Policy Act, as added by sub-
sections (a) and (b), shall apply to—
(A) solicitations for sealed bids or competi-
tive proposals issued after the end of the 180-
day period beginning on the date of the enact-
ment of this Act; and
(B) contracts awarded pursuant to those
solicitations.
(2) 
AUTHORITY
TO
APPLY
AMENDMENTS
EARLY.—The head of an executive agency may apply
sections 30 and 31 of the Office of Federal Procure-
ment Policy Act to solicitations issued before the end
of the period referred to in paragraph (1). The head
of the executive agency shall publish in the Federal
Register notice of any such earlier date of applica-
tion at least 10 days before that date.
(d) STANDARDS AND REQUIREMENTS FOR COST AND
PRICE AS EVALUATION FACTORS.—
(1) IN
GENERAL.—The Federal Acquisition
Regulation, as revised pursuant to section 7002,
shall establish standards and requirements for the
consideration of cost and price to the Federal Gov-
ernment as evaluation factors under section 30(c) of
the Office of Federal Procurement Policy Act, as
added by subsection (a).
(2) STANDARDS AND REQUIREMENTS.—Stand-
ards and requirements established under subsection
(a) shall be adequate to ensure that, to the maxi-
mum extent practicable consistent with the needs of
the Federal Government in conducting procure-
ments—
(A) cost or price is an evaluation factor of
sufficient weight to affect each source selection
decision; and
(B) competition among competing offerors
is affected by cost or price.
SEC. 1062. SOLICITATION PROVISION REGARDING EVALUA-
TION OF PURCHASE OPTIONS.
Section 30 of the Office of Federal Procurement Pol-
icy Act, as added by section 1061(a), is amended by add-
ing at the end the following new subsection:
‘‘(d) An agency head, in issuing a solicitation for a
contract to be awarded using sealed bid procedures, may
not include in such solicitation a clause providing for the
evaluation of prices under the contract for options to pur-
chase additional supplies or services under the contract
unless the agency head has determined that there is a rea-
sonable likelihood that the options will be exercised.’’.
SEC. 1063. PROMPT NOTICE OF AWARD.
(a) SEALED BID PROCEDURES.—Subsection (c) of
section 31 of the Office of Federal Procurement Policy
Act, as added by section 1061(b), is amended by adding
at the end the following: ‘‘Within 3 days after the date
of contract award, the agency head shall notify, in writing
or by electronic means, offerors not awarded the contract
that the contract has been awarded.’’.
(b) COMPETITIVE PROPOSALS PROCEDURES.—Para-
graph (2) of subsection (d) of such section is amended
in the second sentence by striking out ‘‘shall promptly no-
tify’’ and inserting in lieu thereof ‘‘, within 3 days after
the date of contract award, shall notify, in writing or by
electronic means,’’.
SEC. 1064. POST-AWARD DEBRIEFINGS.
Section 31 of the Office of Federal Procurement Pol-
icy Act, as added by section 1061(b), is amended—
(1) by redesignating subsections (e) and (f) as
subsections (f) and (g), respectively; and
(2) by inserting after subsection (d) the follow-
ing new subsection (e):
‘‘(e)(1) When a contract is awarded by an executive
agency on the basis of competitive proposals, an unsuc-
cessful offeror, upon written request received by the execu-
tive agency within 3 days after the date of receipt of notifi-
cation of the contract award, shall be debriefed and fur-
nished the basis for the selection decision and contract
award. An employee of the executive agency shall debrief
the offeror within 5 days after receipt of the request by
the executive agency.
‘‘(2) The debriefing shall include, at a minimum—
‘‘(A) the executive agency’s evaluation of the
significant weak or deficient factors in the offeror’s
offer;
‘‘(B) the overall evaluated cost of the offer of
the contractor awarded the contract and the overall
evaluated cost of the offer of the debriefed offeror;
‘‘(C) the overall ranking of all offers and the
total technical and cost scores of all offers;
‘‘(D) a summary of the rationale for the award;
‘‘(E) in the case of a proposal that incorporates
equipment that is a commercial item, the make and
model of the item incorporated in the offer of the
contractor awarded the contract; and
‘‘(F) reasonable responses to questions posed by
the debriefed offeror as to whether source selection
procedures set forth in the solicitation, applicable
regulations, and other applicable authorities were
followed by the executive agency.
‘‘(3) The debriefing may not include point-by-point
comparisons of the debriefed offeror’s offer with other of-
fers and may not disclose any information that is exempt
from disclosure under section 552 of title 5, United States
Code, including information relating to—
‘‘(A) trade secrets;
‘‘(B) privileged or confidential manufacturing
processes and techniques; and
‘‘(C) commercial and financial information that
is privileged or confidential, including cost break-
downs, profit, indirect cost rates, and similar infor-
mation.
‘‘(4) Each solicitation for competitive proposals shall
include a statement that information described in para-
graph (2) may be disclosed in post-award debriefings.
‘‘(5) If, within one year after the date of the contract
award and as a result of a successful procurement protest
or otherwise, the executive agency seeks to fulfill same the
requirement under the contract either on the basis of a
new solicitation of offers or on the basis of new best and
final offers requested for that contract, the agency head
shall make available to offerors—
‘‘(A) the information provided in debriefings
under this subsection regarding the offer of the con-
tractor awarded the contract; and
‘‘(B) the comparable debriefing information
that was prepared with respect to the original
offerors.
‘‘(6) The contracting officer shall include a summary
of the debriefing in the contract file.’’.
SEC. 1065. PROTEST FILE.
Section 31 of the Office of Federal Procurement Pol-
icy Act, as amended by section 1064(1), is further amend-
ed by adding at the end the following:
‘‘(h)(1) If, in the case of a solicitation for a contract
issued by, or an award or proposed award of a contract
by, an agency head, a protest is filed pursuant to the pro-
cedures in subchapter V of chapter 35 of title 31, United
States Code, and an actual or prospective offeror so re-
quests, a file of the protest shall be established by the pro-
curing activity and reasonable access shall be provided to
actual or prospective offerors.
‘‘(2) Information exempt from disclosure under sec-
tion 552 of title 5, United States Code, may be redacted
in a file established pursuant to paragraph (1) unless an
applicable protective order provides otherwise.
‘‘(3) Regulations implementing this subsection shall
be consistent with the regulations regarding the prepara-
tion and submission of an agency’s protest file (the so-
called ‘rule 4 file’) for protests to the General Services
Board of Contract Appeals under section 111 of the Fed-
eral Property and Administrative Services Act of 1949 (41
U.S.C. 759).’’.
SEC. 1066. AWARD OF COSTS AND FEES IN AGENCY SETTLE-
MENT OF PROTESTS.
Section 31 of the Office of Federal Procurement Pol-
icy Act, as amended by section 1065, is further amended
by adding at the end the following new subsection:
‘‘(i) If, in connection with a protest, an agency head
determines that a solicitation, proposed award, or award
does not comply with the requirements of law or regula-
tion, the agency head may take—
‘‘(1) any action set out in subparagraphs (A)
through (F) of subsection (b)(1) of section 3554 of
title 31, United States Code; and
‘‘(2) may pay costs described in paragraph (1)
of section 3554(c) of such title.’’.
SEC. 1067. AWARD OF MULTIPLE CONTRACTS.
Section 31 of the Office of Federal Procurement Pol-
icy Act, as amended by section 1066, is further amended
by adding at the end the following new subsection:
‘‘(j) AWARD OF MULTIPLE CONTRACTS.—In procur-
ing any supply or service using competitive procedures, an
executive agency may award more than one contract for
the same supply or service in any case in which the head
of the agency determines that it is in the best interests
of the Federal Government to award those contracts for
the purpose of maintaining a continuous source for the
supply or service.’’.
PART III—KINDS OF CONTRACTS
SEC. 1071. AGENCY HEAD DETERMINATION REGARDING
USE OF COST TYPE OR INCENTIVE CON-
TRACT.
Section 304(b) of the Federal Property and Adminis-
trative Services Act of 1949 (41 U.S.C. 254(b)) is amend-
ed by striking out the second sentence.
SEC. 1072. MULTIYEAR CONTRACTING AUTHORITY.
(a) IN GENERAL.—Title III of the Federal Property
and Administrative Services Act of 1949 (41 U.S.C. 251
et seq.) is amended by inserting after section 303G the
following new section:
‘‘SEC. 303H. MULTIYEAR CONTRACTS.
‘‘(a) AUTHORITY.—The head of an executive agency
may enter into a multiyear contract for the acquisition of
property or services if—
‘‘(1) funds are available and obligated for such
contract, for the full period of the contract or for the
first fiscal year in which the contract is in effect,
and for the estimated costs associated with any nec-
essary termination of such contract;
‘‘(2) the agency head determines that—
‘‘(A) the need for the property or services
is reasonably firm and continuing over the pe-
riod of the contract; and
‘‘(B) a multiyear contract will serve the
best interests of the United States by encourag-
ing full and open competition or promoting
economy in administration, performance, and
operation of the agency’s programs; and
‘‘(3) such contract is awarded on a fully com-
petitive basis.
‘‘(b) TERMINATION CLAUSE.—A multiyear contract
entered into under the authority of this section shall in-
clude a clause that provides that the contract shall be ter-
minated if funds are not made available for the continu-
ation of such contract in any fiscal year covered by the
contract. Amounts available for paying termination costs
shall remain available for such purpose until the costs as-
sociated with termination of the contract are paid.
‘‘(c) CANCELLATION CEILING NOTICE.—Before any
contract described in subsection (a) that contains a clause
setting forth a cancellation ceiling in excess of
$10,000,000 may be awarded, the head of the agency shall
give written notification of the proposed contract and of
the proposed cancellation ceiling for that contract to the
Congress, and such contract may not then be awarded
until the end of a period of 30 days beginning on the date
of such notification.
‘‘(d) MULTIYEAR CONTRACT DEFINED.—For the
purposes of this section, a multiyear contract is a contract
for the purchase of property or services for more than one,
but not more than five, program years. Such a contract
may provide that performance under the contract during
the second and subsequent years of the contract is contin-
gent upon the appropriation of funds and (if it does so
provide) may provide for a cancellation payment to be
made to the contractor if such appropriations are not
made.
‘‘(e) RULE OF CONSTRUCTION.—Nothing in this sec-
tion is intended to modify or affect any other provision
of law that authorizes multiyear contracts.’’.
(b) CLERICAL AMENDMENT.—The first section of
such Act is amended by inserting after the item relating
to section 303G in the table of contents the following new
item:
‘‘Sec. 303H. Multiyear contracts.’’.
SEC. 1073. SEVERABLE SERVICES CONTRACTS CROSSING
FISCAL YEARS.
(a) IN GENERAL.—Title III of the Federal Property
and Administrative Services Act of 1949 (41 U.S.C. 251
et seq.), as amended by section 1072, is further amended
by inserting after section 303H the following new section:
‘‘SEC. 303I. SEVERABLE SERVICES CONTRACTS FOR PERI-
ODS CROSSING FISCAL YEARS.
‘‘(a) AUTHORITY.—The head of an executive agency
may enter into a severable contract for procurement of
services for a period that begins in one fiscal year and
ends in the next fiscal year if (without regard to any op-
tion to extend the period of the contract) the contract pe-
riod does not exceed one year.
‘‘(b) AVAILABILITY OF FUNDS.—To the extent pro-
vided in appropriations Acts, funds obligated for a con-
tract entered into under the authority of subsection (a)
shall remain available until no longer needed to pay for
such contract.
‘‘(c) SEVERABLE CONTRACT DEFINED.—In this sec-
tion, the term ‘severable contract’ means a contract that
contains a clause that makes the effectiveness of the con-
tract for periods after the end of the fiscal year in which
the performance of the contract begins subject to the
availability of appropriations.’’.
(b) CLERICAL AMENDMENT.—The first section of
such Act is amended by inserting after the item relating
to section 303H in the table of contents the following new
item:
‘‘Sec. 303I. Severable services contracts for periods crossing fiscal years.’’.
SEC. 1074. ECONOMY ACT PURCHASES.
(a) REGULATIONS REQUIRED.—Not later than six
months after the date of the enactment of this Act, the
Federal Acquisition Regulation shall be revised to include
regulations governing the exercise of the authority under
section 1535 of title 31, United States Code, for Federal
agencies to purchase goods and services under contracts
entered into or administered by other agencies.
(b) CONTENT OF REGULATIONS.—The regulations
prescribed pursuant to subsection (a) shall—
(1) require that each purchase described in sub-
section (a) be approved in advance by a contracting
officer of the ordering agency with authority to con-
tract for the goods or services to be purchased or by
another official in a position specifically designated
by regulation to approve such purchase;
(2) provide that such a purchase of goods or
services may be made only if—
(A) the purchase is appropriately made
under a contract that the agency filling the pur-
chase order entered into, before the purchase
order, in order to meet the requirements of
such agency for the same or similar goods or
services;
(B) the agency filling the purchase order is
better qualified to enter into or administer the
contract for such goods or services by reason of
capabilities or expertise that is not available
within the ordering agency; or
(C) the agency or unit filling the order is
specifically authorized by law or regulations to
purchase such goods or services on behalf of
other agencies;
(3) prohibit any such purchase under a contract
or other agreement entered into or administered by
an agency not covered by the Federal Acquisition
Regulation unless the purchase is approved in ad-
vance by the senior procurement official responsible
for purchasing by the ordering agency; and
(4) prohibit any payment to the agency filling
a purchase order of any fee that exceeds the actual
cost or, if the actual cost is not known, the esti-
mated cost of entering into and administering the
contract or other agreement under which the order
is filled.
(c) MONITORING SYSTEM REQUIRED.—The Adminis-
trator for Federal Procurement Policy shall ensure that,
not later than one year after the date of the enactment
of this Act, systems for collecting and evaluating procure-
ment data are capable of collecting and evaluating appro-
priate data on procurements conducted under the regula-
tions prescribed pursuant to subsection (a).
(d) TERMINATION.—This section shall cease to be ef-
fective one year after the date on which final regulations
prescribed pursuant to subsection (a) take effect.
PART IV—MISCELLANEOUS
SEC. 1091. POLICY REGARDING CONSIDERATION OF CON-
TRACTOR PAST PERFORMANCE.
(a) POLICY.—Section 2 of the Office of Federal Pro-
curement Policy Act (41 U.S.C. 401) is amended—
(1) by striking out ‘‘and’’ at the end of para-
graph (12);
(2) by striking out the period at the end of
paragraph (13) and inserting in lieu thereof ‘‘; and’’;
and
(3) by adding at the end the following new
paragraph:
‘‘(14) establishing policies and procedures that
encourage the consideration of contractors’ past per-
formance in the selection of contractors.’’.
(b) GUIDANCE REQUIRED.—Section 6 of the Office
of Federal Procurement Policy Act (41 U.S.C. 405) is
amended by adding at the end the following:
‘‘(j)(1) Congress makes the following findings:
‘‘(A) Past contract performance of an offeror is
one of the relevant factors that contracting officials
of executive agencies should consider in entering into
contracts.
‘‘(B) It is appropriate for a contracting official
to consider past contract performance of an offeror
as an indicator of the likelihood that the offeror will
successfully perform a contract to be entered into by
that official.
‘‘(2) The Administrator shall prescribe for executive
agencies guidance regarding consideration of the past con-
tract performance of offerors in awarding contracts. The
guidance shall include—
‘‘(A) standards for evaluating past performance
with respect to cost (when appropriate), schedule,
compliance with technical or functional specifica-
tions, and other relevant performance factors that
facilitate consistent and fair evaluation by all execu-
tive agencies;
‘‘(B) policies for the collection and maintenance
of information on past contract performance that, to
the maximum extent practicable, facilitate auto-
mated collection, maintenance, and dissemination of
information and provide for ease of collection, main-
tenance, and dissemination of information by other
methods, as necessary; and
‘‘(C) policies for ensuring that offerors are af-
forded an opportunity to submit information on past
contract performance and that information submit-
ted by offerors is considered.
‘‘(3) The Administrator shall prescribe for all execu-
tive agencies the policy regarding the period for which in-
formation on past performance of offerors may be main-
tained and considered.
‘‘(4) In the case of an offeror regarding whom there
is no information on past contract performance or regard-
ing whom information on past contract performance is not
available, the offeror may not be evaluated favorably or
unfavorably on the factor of past contract performance.’’.
SEC. 1092. REPEAL OF REQUIREMENT FOR ANNUAL RE-
PORT ON COMPETITION.
Section 23 of the Office of Federal Procurement Pol-
icy Act (41 U.S.C. 419) is repealed.
SEC. 1093. DISCOURAGEMENT OF NONSTANDARD CON-
TRACT CLAUSES.
Section 31 of the Office of Federal Procurement Pol-
icy Act, as amended by section 1067, is further amended
by adding at the end the following new subsection:
‘‘(k) NONSTANDARD
CONTRACT
CLAUSES.—The
Federal Acquisition Regulatory Council shall promulgate
regulations to discourage the use of a nonstandard con-
tract clause on a repetitive basis. The regulations shall in-
clude provisions that—
‘‘(1) clearly define nonstandard clauses; and
‘‘(2) require prior approval for the use of a
nonstandard clause on a repetitive basis by an offi-
cial at a level of responsibility above the contracting
officer.’’.
SEC. 1094. REPEAL OF OBSOLETE PROVISION.
(a) REPEAL.—Section 303E of the Federal Property
and Administrative Services Act of 1949 (41 U.S.C. 253e)
is repealed.
(b) CLERICAL AMENDMENT.—The table of contents
in the first section of such Act is amended by striking out
the item relating to section 303E.
Subtitle B—Truth in Negotiations
SEC. 1251. PROVISIONS TO ENSURE UNIFORM TREATMENT
OF COST OR PRICING DATA.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 1061, is fur-
ther amended by adding after section 31 the following new
section:
‘‘SEC. 32. COST OR PRICING DATA: TRUTH IN NEGOTIA-
TIONS.
‘‘(a) REQUIRED COST OR PRICING DATA AND CER-
TIFICATION.—(1) An agency head shall require offerors,
contractors, and subcontractors to make cost or pricing
data available as follows:
‘‘(A) An offeror for a prime contract under this
title to be entered into using procedures other than
sealed-bid procedures shall be required to submit
cost or pricing data before the award of a contract
if—
‘‘(i) in the case of a prime contract entered
into after the date of the enactment of the Fed-
eral Acquisition Improvement Act of 1994, the
price of the contract to the United States is ex-
pected to exceed $500,000; and
‘‘(ii) in the case of a prime contract en-
tered into on or before the date of the enact-
ment of the Federal Acquisition Improvement
Act of 1994, the price of the contract to the
United States is expected to exceed $100,000.
‘‘(B) The contractor for a prime contract under
this chapter shall be required to submit cost or pric-
ing data before the pricing of a change or modifica-
tion to the contract if—
‘‘(i) in the case of a change or modification
made to a prime contract referred to in sub-
paragraph (A)(i), the price adjustment is ex-
pected to exceed $500,000;
‘‘(ii) in the case of a change or modifica-
tion made to a prime contract that was entered
into on or before the date of the enactment of
the Federal Acquisition Improvement Act of
1994, and that has been modified pursuant to
paragraph (6), the price adjustment is expected
to exceed $500,000; and
‘‘(iii) in the case of a change or modifica-
tion not covered by clause (i) or (ii), the price
adjustment is expected to exceed $100,000.
‘‘(C) An offeror for a subcontract (at any tier)
of a contract under this title shall be required to
submit cost or pricing data before the award of the
subcontract if the prime contractor and each higher-
tier subcontractor have been required to make avail-
able cost or pricing data under this section and—
‘‘(i) in the case of a subcontract under a
prime contract referred to in subparagraph
(A)(i), the price of the subcontract is expected
to exceed $500,000;
‘‘(ii) in the case of a subcontract entered
into under a prime contract that was entered
into on or before the date of the enactment of
the Federal Acquisition Improvement Act of
1994, and that has been modified pursuant to
paragraph (6), the price of the subcontract is
expected to exceed $500,000; and
‘‘(iii) in the case of a subcontract not cov-
ered by clause (i) or (ii), the price of the sub-
contract is expected to exceed $100,000.
‘‘(D) The subcontractor for a subcontract cov-
ered by subparagraph (C) shall be required to sub-
mit cost or pricing data before the pricing of a
change or modification to the subcontract if—
‘‘(i) in the case of a change or modification
to a subcontract referred to in subparagraph
(C)(i) or (C)(ii), the price adjustment is ex-
pected to exceed $500,000; and
‘‘(ii) in the case of a change or modifica-
tion to a subcontract referred to in subpara-
graph (C)(iii), the price adjustment is expected
to exceed $100,000.
‘‘(2) A person required, as an offeror, contractor, or
subcontractor, to submit cost or pricing data under para-
graph (1) (or required by the head of the procuring activ-
ity concerned to submit such data under subsection (c))
shall be required to certify that, to the best of the person’s
knowledge and belief, the cost or pricing data submitted
are accurate, complete, and current.
‘‘(3) Cost or pricing data required to be submitted
under paragraph (1) (or under subsection (c)), and a cer-
tification required to be submitted under paragraph (2),
shall be submitted—
‘‘(A) in the case of a submission by a prime
contractor (or an offeror for a prime contract), to
the contracting officer for the contract (or to a des-
ignated representative of the contracting officer); or
‘‘(B) in the case of a submission by a sub-
contractor (or an offeror for a subcontract), to the
prime contractor.
‘‘(4) Except as provided under subsection (b), this
section applies to contracts entered into by an agency head
on behalf of a foreign government.
‘‘(5) For purposes of paragraph (1)(C), a contractor
or subcontractor granted a waiver under subsection (b)(2)
shall be considered as having been required to make avail-
able cost or pricing data under this section.
‘‘(6) Upon the request of a contractor that was re-
quired to submit cost or pricing data under paragraph (1)
in connection with a prime contract entered into on or be-
fore the date of the enactment of the Federal Acquisition
Improvement Act of 1994, the agency head that entered
into such contract shall modify the contract to reflect sub-
paragraphs (B)(ii) and (C)(ii) of paragraph (1). All such
modifications shall be made without requiring consider-
ation.
‘‘(7) Effective on October 1 of each year that is divis-
ible by 5, each amount set forth in paragraph (1) shall
be adjusted to the amount that is equal to the fiscal year
1994 constant dollar value of the amount set forth. Any
amount, as so adjusted, that is not evenly divisible by
$50,000 shall be rounded to the nearest multiple of
$50,000. In the case of an amount that is evenly divisible
by $25,000 but not evenly divisible by $50,000, the
amount shall be rounded to the next higher multiple of
$50,000.
‘‘(b) EXCEPTIONS.—(1) Submission of cost and pric-
ing data shall not be required under subsection (a)—
‘‘(A) in the case of a contract, a subcontract,
or a contract or subcontract modification, for which
the price agreed upon is based on—
‘‘(i) adequate price competition;
‘‘(ii) established catalog or market prices
of commercial items or of services regularly
used for other than Government purposes, as
the case may be, that are sold in substantial
quantities to the general public; or
‘‘(iii) prices set by law or regulation; or
‘‘(B) in an exceptional case when the head of
the procuring activity, without delegation, deter-
mines that the requirements of this section may be
waived, justifies in writing the reasons for such de-
termination, and certifies the accuracy and com-
pleteness of the justification.
‘‘(2) The Federal Acquisition Regulation (issued
under section 25(c)) shall provide clear standards for de-
termining whether the exceptions provided in paragraph
(1)(A) apply. In the case of the exception provided in
paragraph (1)(A)(i), the regulations shall specify the cri-
teria that will be used to determine whether adequate price
competition exists. In the case of the exception provided
in paragraph (1)(A)(ii), the regulations shall preclude the
consideration of sales to the Federal Government, includ-
ing the percentage of an item’s overall sales that are made
to the Federal Government, when determining whether the
item has been sold in substantial quantities to the public.
‘‘(c) AUTHORITY TO REQUIRE COST OR PRICING
DATA ON BELOW-THRESHOLD CONTRACTS.—When cost
or pricing data are not required to be submitted by sub-
section (a), such data may nevertheless be required to be
submitted by the head of the procuring activity, but only
if the head of the procuring activity determines that such
data are necessary for the evaluation by the agency of the
reasonableness of the price of the contract or subcontract.
In any case in which the head of the procuring activity
requires such data to be submitted under this subsection,
the head of the procuring activity shall justify in writing
the reason for such requirement and certify the accuracy
and completeness of the justification. The head of the pro-
curing activity may not delegate the functions under this
subsection.
‘‘(d) ADDITIONAL EXCEPTION PROVISIONS REGARD-
ING COMMERCIAL ITEMS.—(1) In any case in which it is
not practicable to conduct a procurement of a commercial
item on a competitive basis and the procurement is not
covered by an exception in subsection (b), the contracting
officer shall nonetheless exempt a contract or subcontract
under the procurement from the requirements of sub-
section (a) if the contracting officer develops or obtains
from the offeror or contractor, or from another source or
sources, in accordance with standards and procedures set
forth in the Federal Acquisition Regulation, information
on prices at which the same or similar items have been
sold in the commercial market that is adequate for evalu-
ating the reasonableness of the price of the contract or
subcontract for a commercial item.
‘‘(2)(A) In accordance with procedures prescribed in
the Federal Acquisition Regulation, an agency head shall
have the right to examine all information provided by an
offeror, contractor, or subcontractor pursuant to sub-
section (b)(1)(A) or paragraph (1) of this subsection and
all books and records of such offeror, contractor, or sub-
contractor that directly relate to such information in order
to determine whether the agency is receiving accurate in-
formation required under this section.
‘‘(B) The right under subparagraph (A) shall expire
1 year after the date of commencement of performance
of the contract, or 1 year after the date of commencement
of performance of the modification of the contract, with
respect to which the information was provided.
‘‘(3) The Federal Acquisition Regulation shall estab-
lish reasonable limitations on requests under this section
for sales data relating to commercial items.
‘‘(e) PRICE REDUCTIONS FOR DEFECTIVE COST OR
PRICING DATA.—(1)(A) A prime contract (or change or
modification to a prime contract) under which a certificate
under subsection (a)(2) is required shall contain a provi-
sion that the price of the contract to the United States,
including profit or fee, shall be adjusted to exclude any
significant amount by which it may be determined by the
agency head that such price was increased because the
contractor (or any subcontractor required to make avail-
able such a certificate) submitted defective cost or pricing
data.
‘‘(B) For the purposes of this section, defective cost
or pricing data are cost or pricing data which, as of the
date of agreement on the price of the contract (or another
date agreed upon between the parties), were inaccurate,
incomplete, or noncurrent. If for purposes of the preceding
sentence the parties agree upon a date other than the date
of agreement on the price of the contract, the date agreed
upon by the parties shall be as close to the date of agree-
ment on the price of the contract as is practicable.
‘‘(2) In determining for purposes of a contract price
adjustment under a contract provision required by para-
graph (1) whether, and to what extent, a contract price
was increased because the contractor (or a subcontractor)
submitted defective cost or pricing data, it shall be a de-
fense that the United States did not rely on the defective
data submitted by the contractor or subcontractor.
‘‘(3) It is not a defense to an adjustment of the price
of a contract under a contract provision required by para-
graph (1) that—
‘‘(A) the price of the contract would not have
been modified even if accurate, complete, and cur-
rent cost or pricing data had been submitted by the
contractor or subcontractor because the contractor
or subcontractor—
‘‘(i) was the sole source of the property or
services procured; or
‘‘(ii) otherwise was in a superior bargain-
ing position with respect to the property or
services procured;
‘‘(B) the contracting officer should have known
that the cost and pricing data in issue were defective
even though the contractor or subcontractor took no
affirmative action to bring the character of the data
to the attention of the contracting officer;
‘‘(C) the contract was based on an agreement
between the contractor and the United States about
the total cost of the contract and there was no
agreement about the cost of each item procured
under such contract; or
‘‘(D) the prime contractor or subcontractor did
not submit a certification of cost and pricing data
relating to the contract as required under subsection
(a)(2).
‘‘(4)(A) A contractor shall be allowed to offset an
amount against the amount of a contract price adjustment
under a contract provision required by paragraph (1) if—
‘‘(i) the contractor certifies to the contracting
officer (or to a designated representative of the con-
tracting officer) that, to the best of the contractor’s
knowledge and belief, the contractor is entitled to
the offset; and
‘‘(ii) the contractor proves that the cost or pric-
ing data were available before the date of agreement
on the price of the contract (or price of the modi-
fication), or, if applicable consistent with paragraph
(1)(B), another date agreed upon between the par-
ties, and that the data were not submitted as speci-
fied in subsection (a)(3) before such date.
‘‘(B) A contractor shall not be allowed to offset an
amount otherwise authorized to be offset under subpara-
graph (A) if—
‘‘(i) the certification under subsection (a)(2)
with respect to the cost or pricing data involved was
known to be false when signed; or
‘‘(ii) the United States proves that, had the cost
or pricing data referred to in subparagraph (A)(ii)
been submitted to the United States before the date
of agreement on the price of the contract (or price
of the modification) or, if applicable under para-
graph (1)(B), another date agreed upon between the
parties, the submission of such cost or pricing data
would not have resulted in an increase in that price
in the amount to be offset.
‘‘(f) INTEREST AND PENALTIES FOR CERTAIN OVER-
PAYMENTS.—(1) If the United States makes an overpay-
ment to a contractor under a contract with an executive
agency subject to this section and the overpayment was
due to the submission by the contractor of defective cost
or pricing data, the contractor shall be liable to the United
States—
‘‘(A) for interest on the amount of such over-
payment, to be computed—
‘‘(i) for the period beginning on the date
the overpayment was made to the contractor
and ending on the date the contractor repays
the amount of such overpayment to the United
States; and
‘‘(ii) at the current rate prescribed by the
Secretary of the Treasury under section 6621
of the Internal Revenue Code of 1986; and
‘‘(B) if the submission of such defective data
was a knowing submission, for an additional amount
equal to the amount of the overpayment.
‘‘(2) Any liability under this subsection of a contrac-
tor that submits cost or pricing data but refuses to submit
the certification required by subsection (a)(2) with respect
to the cost or pricing data shall not be affected by the
refusal to submit such certification.
‘‘(g) RIGHT OF UNITED STATES TO EXAMINE CON-
TRACTOR RECORDS.—For the purpose of evaluating the
accuracy, completeness, and currency of cost or pricing
data required to be submitted by this section, the head
of an agency shall have the rights provided by section
38(a)(2).
‘‘(h) COST OR PRICING DATA DEFINED.—In this sec-
tion, the term ‘cost or pricing data’ means all facts that,
as of the date of agreement on the price of a contract
(or the price of a contract modification) or, if applicable
consistent with subsection (e)(1)(B), another date agreed
upon between the parties, a prudent buyer or seller would
reasonably expect to affect price negotiations significantly.
Such terms does not include information that is
judgmental, but does include the factual information from
which a judgment was derived.’’.
Subtitle C—Procurement Protests
PART I—PROTESTS TO THE COMPTROLLER
GENERAL
SEC. 1401. PROTEST DEFINED.
Paragraph (1) of section 3551 of title 31, United
States Code, is amended to read as follows:
‘‘(1) ‘protest’ means a written objection by an
interested party—
‘‘(i) to a solicitation or other request by a
Federal agency for offers for a contract for the
procurement of property or services;
‘‘(ii) to the cancellation of such a solicita-
tion or other request;
‘‘(iii) to an award or proposed award of
such a contract; or
‘‘(iv) to a termination or cancellation of an
award of such a contract, if the written objec-
tion contains an allegation that the termination
or cancellation is based in whole or in part on
improprieties concerning the award of the con-
tract;’’.
SEC. 1402. REVIEW OF PROTESTS AND EFFECT ON CON-
TRACTS PENDING DECISION.
(a) PERIODS FOR CERTAIN ACTIONS.—Section 3553
of title 31, United States Code, is amended—
(1) in subsection (b)—
(A) in paragraph (1), by striking out ‘‘one
working day of’’ and inserting in lieu thereof
‘‘one day after’’; and
(B) in paragraph (2)—
(i) in subparagraph (A), by striking
out ‘‘25 working days from’’ and inserting
in lieu thereof ‘‘35 days after’’; and
(ii) in subparagraph (C), by striking
out ‘‘10 working days from’’ and inserting
in lieu thereof ‘‘15 days after’’; and
(2) in subsection (c)(3), by striking out ‘‘there-
after’’ and inserting in lieu thereof ‘‘after the mak-
ing of such finding’’.
(b) SUSPENSION OF PERFORMANCE.—Subsection (d)
of such section is amended to read as follows:
‘‘(d)(1) A contractor awarded a Federal agency con-
tract may, during the period described in paragraph (4),
begin performance of the contract and engage in any relat-
ed activities that result in obligations being incurred by
the United States under the contract unless the contract-
ing officer responsible for the award of the contract with-
holds authorization to proceed with performance of the
contract.
‘‘(2) The contracting officer may withhold an author-
ization to proceed with performance of the contract during
the period described in paragraph (4) if the contracting
officer determines in writing that—
‘‘(A) a protest is likely to be filed; and
‘‘(B) the immediate performance of the contract
is not in the best interests of the United States.
‘‘(3)(A) If the Federal agency awarding the contract
receives notice of a protest in accordance with this section
during the period described in paragraph (4)—
‘‘(i) the contracting officer may not authorize
performance of the contract to begin while the pro-
test is pending; or
‘‘(ii) if contract performance was authorized in
accordance with paragraph (2) before receipt of the
notice, the contracting officer shall immediately di-
rect the contractor to cease performance under the
contract and to suspend any related activities that
may result in additional obligations being incurred
by the United States under that contract.
‘‘(B) Performance and related activities suspended
pursuant to subparagraph (A)(ii) by reason of a protest
may not be resumed while the protest is pending.
‘‘(C) The head of the procuring activity may author-
ize the performance of the contract (notwithstanding a
protest of which the Federal agency has notice under this
section)—
‘‘(i) upon a written finding that—
‘‘(I) performance of the contract is in the
best interests of the United States; or
‘‘(II) urgent and compelling circumstances
that significantly affect interests of the United
States will not permit waiting for the decision
of the Comptroller General concerning the pro-
test; and
‘‘(ii) after the Comptroller General is notified of
that finding.
‘‘(4) The period referred to in paragraphs (2) and
(3)(A), with respect to a contract, is the period beginning
on the date of the contract award and ending on the later
of—
‘‘(A) the date that is 10 days after the date of
the contract award; or
‘‘(B) the date that is 5 days after the debriefing
date offered to an unsuccessful offeror for any de-
briefing that is requested and, when requested, is
required.’’.
SEC. 1403. DECISIONS ON PROTESTS.
(a) PERIODS
FOR
CERTAIN
ACTIONS.—Section
3554(a) of title 31, United States Code, is amended—
(1) in paragraph (1), by striking out ‘‘90 work-
ing days from’’ and inserting in lieu thereof ‘‘120
days after’’;
(2) in paragraph (2), by striking out ‘‘45 cal-
endar days from’’ and inserting ‘‘60 days after’’;
(3) by redesignating paragraph (3) as para-
graph (4); and
(4) by inserting after paragraph (2) the follow-
ing new paragraph (3):
‘‘(3) An amendment to a protest that adds a new
ground of protest, if timely raised, should be resolved, to
the maximum extent practicable, within the time limit es-
tablished under paragraph (1) of this subsection for final
decision of the initial protest. If an amended protest can-
not be resolved within such time limit, the Comptroller
General may resolve the amended protest through the ex-
press option under paragraph (2) of this subsection.’’.
(b) GAO RECOMMENDATIONS ON PROTESTS.—
(1) 
IMPLEMENTATION
OF
RECOMMENDA-
TIONS.—Section 3554 of title 31, United States
Code, is amended—
(A) in subsection (b), by adding at the end
the following new paragraph:
‘‘(3) If the Federal agency fails to implement fully
the recommendations of the Comptroller General under
this subsection with respect to a solicitation for a contract
or an award or proposed award of a contract within 60
days after receiving the recommendations, the head of the
procuring activity responsible for that contract shall re-
port such failure to the Comptroller General not later than
5 working days after the end of such 60-day period.’’;
(B) by striking out subsection (c) and in-
serting in lieu thereof the following:
‘‘(c)(1) If the Comptroller General determines that
a solicitation for a contract or a proposed award or the
award of a contract does not comply with a statute or reg-
ulation, the Comptroller General may recommend that the
Federal agency conducting the procurement pay to an ap-
propriate interested party the costs of—
‘‘(A) filing and pursuing the protest, including
reasonable attorney’s fees and consultant and expert
witness fees; and
‘‘(B) bid and proposal preparation.
‘‘(2) If the Comptroller General recommends under
paragraph (1) that a Federal agency pay costs to an inter-
ested party, the Federal agency shall—
‘‘(A) pay the costs promptly out of funds appro-
priated by section 1304 of this title for the payment
of judgments and reimburse that appropriation ac-
count out of available funds or out of additional
funds appropriated for such Federal agency to make
such reimbursement; or
‘‘(B) if the Federal agency does not make such
payment, promptly report to the Comptroller Gen-
eral the reasons for the failure to follow the Comp-
troller General’s recommendation.
‘‘(3) If the Comptroller General recommends under
paragraph (1) that a Federal agency pay costs to an inter-
ested party, the Federal agency and the interested party
shall attempt to reach an agreement on the amount of the
costs to be paid. If the Federal agency and the interested
party are unable to agree on the amount to be paid, the
Comptroller General may, upon the request of the inter-
ested party, recommend to the Federal agency the amount
of the costs that the Federal agency should pay.’’; and
(C) by striking out subsection (e) and in-
serting in lieu thereof the following:
‘‘(e)(1) The Comptroller General shall report prompt-
ly to the Committee on Governmental Affairs and the
Committee on Appropriations of the Senate and to the
Committee on Government Operations and the Committee
on Appropriations of the House of Representatives any
case in which a Federal agency fails to implement fully
a recommendation of the Comptroller General under sub-
section (b) or (c). The report shall include—
‘‘(A) a comprehensive review of the pertinent
procurement, including the circumstances of the fail-
ure of the Federal agency to implement a rec-
ommendation of the Comptroller General; and
‘‘(B) a recommendation regarding whether, in
order to correct an inequity or to preserve the integ-
rity of the procurement process, the Congress should
consider—
‘‘(i) private relief legislation;
‘‘(ii) legislative rescission or cancellation of
funds;
‘‘(iii) further investigation by the Congress;
or
‘‘(iv) other action.
‘‘(2) Not later than January 31 of each year, the
Comptroller General shall transmit to the Congress a re-
port containing a summary of each instance in which a
Federal agency did not fully implement a recommendation
of the Comptroller General under subsection (b) or (c)
during the preceding year. The report shall also describe
each instance in which a final decision in a protest was
not rendered within 125 days after the date the protest
is submitted to the Comptroller General.’’.
(2) REQUIREMENT FOR PAYMENT IN ACCORD-
ANCE
WITH
PRIOR
GAO
DETERMINATIONS.—
Amounts to which the Comptroller General declared
an interested party to be entitled under section 3554
of title 31, United States Code, as in effect imme-
diately before the enactment of this Act, shall, if not
paid or otherwise satisfied by the Federal agency
concerned before the date of the enactment of this
Act, be paid promptly from the appropriation made
by section 1304 of such title for the payment of
judgments. The Federal agency shall reimburse that
appropriation account out of available funds or out
of additional funds appropriated for such Federal
agency to make such reimbursement. If the Federal
agency is unable to make the reimbursement out of
available funds, the head of such agency shall imme-
diately take such action as may be necessary to
transmit to Congress a request for an appropriation
of additional funds to make such reimbursement.
(c) RESTRICTION ON ACCESS TO CERTAIN INFORMA-
TION.—Section 3553(f) of title 31, United States Code,
is amended—
(1) by inserting ‘‘(1)’’ after ‘‘(f)’’; and
(2) by adding at the end the following:
‘‘(2)(A) The Comptroller General may issue protec-
tive orders which establish terms, conditions, and restric-
tions for the provision of any document to a person under
paragraph (1), that prohibit or restrict the disclosure by
the person of information described in subparagraph (C)
that is contained in such a document.
‘‘(B) The penalties specified under section 27(i) of
the Office of Federal Procurement Policy Act shall apply
to the disclosure of information described in subparagraph
(C) in violation of a term, condition, or restriction in a
protective order under this paragraph by a person that
is subject to the protective order.
‘‘(C) Information referred to in subparagraphs (A)
and (B) is procurement sensitive information, trade se-
crets, or other proprietary or confidential research, devel-
opment, or commercial information.
‘‘(D) A protective order under this paragraph shall
not be considered to authorize the withholding of any doc-
ument or information from the Congress or an executive
agency.’’.
SEC. 1404. REGULATIONS.
(a) COMPUTATION OF PERIODS.—Section 3555 of
title 31, United States Code, is amended—
(1) by redesignating subsection (b) as sub-
section (d); and
(2) by inserting after subsection (a) the follow-
ing new subsection (b):
‘‘(b) The procedures shall provide that, in the com-
putation of any period described in this subchapter—
‘‘(1) the day of the act, event, or default from
which the designated period of time begins to run
not be included; and
‘‘(2) the last day after such act, event, or de-
fault be included, unless—
‘‘(A) such last day is a Saturday, a Sun-
day, or a legal holiday; or
‘‘(B) in the case of a filing of a paper at
the General Accounting Office or a Federal
agency, such last day is a day on which weather
or other conditions cause the closing of the
General Accounting Office or Federal agency,
in which event the next day that is not a Satur-
day, Sunday, or legal holiday shall be in-
cluded.’’.
(b) ELECTRONIC FILINGS AND DISSEMINATIONS.—
Such section, as amended by subsection (a), is further
amended by inserting after subsection (b) the following
new subsection:
‘‘(c) The Comptroller General may prescribe proce-
dures for the electronic filing and dissemination of docu-
ments and information required under this subchapter. In
prescribing such procedures, the Comptroller General shall
consider the ability of all parties to achieve electronic ac-
cess to such documents and records.’’.
(c) REPEAL OF OBSOLETE DEADLINE.—Subsection
(a) of such section is amended by striking out ‘‘Not later
than January 15, 1985, the’’ and inserting in lieu thereof
‘‘The’’.
PART II—PROTESTS IN PROCUREMENTS OF
AUTOMATIC DATA PROCESSING
SEC. 1431. REVOCATION OF DELEGATIONS OF PROCURE-
MENT AUTHORITY.
Section 111(b)(3) of the Federal Property and Ad-
ministrative Services Act of 1949 (40 U.S.C. 759(b)(3))
is amended by inserting after the third sentence the fol-
lowing: ‘‘The Administrator may revoke a delegation of
authority with respect to a particular contract before or
after award of the contract, except that the Administrator
may revoke a delegation after the contract is awarded only
when there is a finding of a violation of law or regulation
in connection with the contract award.’’.
SEC. 1432. AUTHORITY OF THE GENERAL SERVICES ADMIN-
ISTRATION BOARD OF CONTRACT APPEALS.
The first sentence of section 111(f)(1) of the Federal
Property and Administrative Services Act of 1949 (40
U.S.C. 759(f)(1)) is amended to read as follows: ‘‘Upon
request of an interested party in connection with any pro-
curement that is subject to this section (including any
such procurement that is subject to delegation of procure-
ment authority), the board of contract appeals of the Gen-
eral Services Administration (hereafter in this subsection
referred to as the ‘board’) shall review, as provided in this
subsection, any decision by a contracting officer that is
alleged to violate a statute, a regulation, or the conditions
of a delegation of procurement authority.’’.
SEC. 1433. PERIODS FOR CERTAIN ACTIONS.
(a) SUSPENSION OF PROCUREMENT AUTHORITY.—
(1) Section 111(f)(2)(B) of the Federal Property and Ad-
ministrative Services Act of 1949 (40 U.S.C. 759(f)) is
amended—
(A) by redesignating clauses (i) and (ii) as
subclauses (I) and (II), respectively;
(B) by inserting ‘‘(i)’’ after ‘‘(B)’’; and
(C) by adding at the end the following:
‘‘(ii) A suspension under this subparagraph shall not
preclude the Federal agency concerned from continuing
the procurement process up to but not including award
of the contract if the Board determines such action is in
the best interests of the United States.’’.
(2) Section 111(f) of the Federal Property and Ad-
ministrative Services Act of 1949 (40 U.S.C. 759(f)) is
amended in paragraph (3) by striking out subparagraph
(A) and inserting in lieu thereof the following:
‘‘(A)(i) If, with respect to an award of a contract,
the board receives notice of a protest under this subsection
within the period described in clause (ii), the board shall,
at the request of an interested party, hold a hearing to
determine whether the board should suspend the procure-
ment authority of the Administrator or the Administra-
tor’s delegation of procurement authority for the protested
procurement on an interim basis until the board can de-
cide the protest.
‘‘(ii) The period referred to in clause (i) is the period
beginning on the date on which the contract is awarded
and ending at the end of the later of—
‘‘(I) the tenth day after the date of contract
award; or
‘‘(II) the fifth day after the debriefing date of-
fered to an unsuccessful offeror for any debriefing
that is requested and, when requested, is required.
‘‘(iii) The board shall hold the requested hearing
within 5 days after the date of the filing of the protest.’’.
(b) FINAL DECISION.—Paragraph (4)(B) of such sec-
tion 111(f) is amended—
(1) by striking out ‘‘45 working days’’ and in-
serting in lieu thereof ‘‘65 days’’; and
(2) by adding at the end the following: ‘‘An
amendment which adds a new ground of protest
should be resolved, to the maximum extent prac-
ticable, within the time limits established for resolu-
tion of the initial protest.’’.
SEC. 1434. DISMISSALS OF PROTESTS.
Section 111(f)(4) of the Federal Property and Ad-
ministrative Services Act of 1949 (40 U.S.C. 759(f)(4))
is amended by striking out subparagraph (C) and insert-
ing in lieu thereof the following:
‘‘(C) The board may dismiss a protest that the board
determines—
‘‘(i) is frivolous;
‘‘(ii) has been brought in bad faith; or
‘‘(iii) does not state on its face a valid basis for
protest.’’.
SEC. 1435. AWARD OF COSTS.
Section 111(f)(5) is amended by striking out sub-
paragraph (C) and inserting in lieu thereof the following:
‘‘(C) Whenever the board makes such a determina-
tion, it may, in accordance with section 1304 of title 31,
United States Code, further declare an appropriate pre-
vailing party to be entitled to the cost of filing and pursu-
ing the protest (including reasonable attorney’s fees and
consultant and expert witness fees), and bid and proposal
preparation.’’.
SEC. 1436. DISMISSAL AGREEMENTS.
Section 111(f)(5) of the Federal Property and Ad-
ministrative Services Act of 1949 (40 U.S.C. 759(f)(5))
is amended by adding at the end the following new sub-
paragraphs:
‘‘(D) Any agreement that provides for the dismissal
of a protest and involves a direct or indirect expenditure
of appropriated funds shall be submitted to the board and
shall be made a part of the public record (subject to any
protective order considered appropriate by the board) be-
fore dismissal of the protest. If a Federal agency is a party
to a settlement agreement, the submission of the agree-
ment submitted to the board shall include a memorandum,
signed by the contracting officer concerned, that describes
in detail the procurement, the grounds for protest, the
Federal Government’s position regarding the grounds for
protest, the terms of the settlement, and the agency’s posi-
tion regarding the propriety of the award or proposed
award of the contract at issue in the protest.
‘‘(E) Payment of amounts due from an agency under
subparagraph (C) or under the terms of a settlement
agreement under subparagraph (D) shall be made from
the appropriation made by section 1304 of title 31, United
States Code, for the payment of judgments. The Federal
agency concerned shall reimburse that appropriation ac-
count out of funds available for the procurement.’’.
SEC. 1437. MATTERS TO BE COVERED IN REGULATIONS.
Section 111(f) of the Federal Property and Adminis-
trative Services Act of 1949 (40 U.S.C. 759(f)) is amend-
ed by striking out paragraph (8) and inserting in lieu
thereof the following:
‘‘(7)(A) The board shall adopt and issue such rules
and procedures as may be necessary to the expeditious dis-
position of protests filed under the authority of this sub-
section.
‘‘(B) The procedures shall provide that, in the com-
putation of any period described in this subsection—
‘‘(i) the day of the act, event, or default from
which the designated period of time begins to run
not be included; and
‘‘(ii) the last day after such act, event, or de-
fault be included, unless—
‘‘(I) such last day is a Saturday, a Sunday,
or a legal holiday; or
‘‘(II) in the case of a filing of a paper at
the board, such last day is a day on which
weather or other conditions make the board or
Federal agency inaccessible, in which event the
next day that is not a Saturday, Sunday, or
legal holiday shall be included.
‘‘(C) The procedures may provide for electronic filing
and dissemination of documents and information required
under this subsection and in so providing shall consider
the ability of all parties to achieve electronic access to such
documents and records.
‘‘(D) The procedures shall provide that if the board
expressly finds that a protest or a portion of a protest
is frivolous or has not been brought or pursued in good
faith, or that any person has willfully abused the board’s
process during the course of a protest, the board may im-
pose appropriate procedural sanctions, including dismissal
of the protest.’’.
SEC. 1438. DEFINITIONS.
(a) PROTEST.—Section 111(f)(9) of the Federal
Property and Administrative Services Act of 1949 (40
U.S.C. 759(f)(9)) is amended—
(1) by striking out ‘‘and’’ at the end of sub-
paragraph (A);
(2) by striking out the period at the end of sub-
paragraph (B) and inserting in lieu thereof ‘‘; and’’;
and
(3) by adding at the end the following new sub-
paragraph:
‘‘(C) the term ‘protest’ means a written objec-
tion by an interested party—
‘‘(i) to a solicitation or other request by a
Federal agency for offers for a contract for the
procurement of property or services;
‘‘(ii) to the cancellation of such a solicita-
tion or other request;
‘‘(iii) to an award or proposed award of
such a contract; or
‘‘(iv) to a termination or cancellation of an
award of such a contract, if the written objec-
tion contains an allegation that the termination
or cancellation is based in whole or in part on
improprieties concerning the award of the con-
tract;’’.
(b) PREVAILING PARTY.—Section 111(f)(9) of such
Act is amended by adding at the end the following new
subparagraph:
‘‘(C) the term ‘prevailing party’, with respect to
a determination of the board under paragraph
(5)(B) that a challenged action of a Federal agency
violates a statute or regulation or the conditions of
a delegation of procurement authority issued pursu-
ant to this section, means a party that demonstrated
such violation.’’.
SEC. 1439. OVERSIGHT OF ACQUISITION OF AUTOMATIC
DATA PROCESSING EQUIPMENT BY FEDERAL
AGENCIES.
Section 111 of the Federal Property and Administra-
tive Services Act of 1949 (40 U.S.C. 759) is amended by
adding at the end the following new subsection:
‘‘(h)(1) The Administrator shall collect and compile
data regarding the procurement of automatic data proc-
essing equipment under this section. The data collected
and compiled shall include, at a minimum, with regard to
each procurement the following:
‘‘(A) The procuring agency.
‘‘(B) The contractor.
‘‘(C) The automatic data processing equipment
and services procured.
‘‘(D) The manufacturer of the equipment pro-
cured.
‘‘(E) The amount of the contract, to the extent
that the amount is not proprietary information.
‘‘(F) The type of contract used.
‘‘(G) The extent of competition for award.
‘‘(H) Compatibility restrictions.
‘‘(I) Significant modifications of the contract.
‘‘(J) Contract price, to the extent that the price
is not proprietary information.
‘‘(2) The head of each Federal agency shall report
to the Administrator in accordance with regulations issued
by the Administrator all information that the Adminis-
trator determines necessary in order to satisfy the require-
ments in paragraph (1).
‘‘(3) The Administrator shall—
‘‘(A) carry out a systematic, periodic review of
information received under this subsection;
‘‘(B) use such information, as appropriate, to
determine the compliance of Federal agencies with
the requirements of this section; and
‘‘(C) have the authority to suspend the delega-
tion to a Federal agency of authority to lease or pur-
chase automatic data processing equipment upon
any failure by the head of the Federal agency to re-
port to the Administrator in accordance with para-
graph (2).’’.
Subtitle D—Definitions and Other
Matters
SEC. 1551. DEFINITIONS.
Section 309(c) of the Federal Property and Adminis-
trative Services Act of 1949 (41 U.S.C. 259(c)) is amend-
ed by striking out ‘‘and ‘supplies’ ’’ and inserting in lieu
thereof 
‘‘ ‘supplies’, 
‘commercial 
item’, 
and
‘nondevelopmental item’ ’’.
SEC. 1552. DELEGATION OF PROCUREMENT FUNCTIONS.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 1251, is fur-
ther amended by inserting after section 32 the following
new section:
‘‘SEC. 33. DELEGATION OF PROCUREMENT FUNCTIONS.
‘‘(a) IN GENERAL.—Except to the extent expressly
prohibited by another provision of law, an agency head
may delegate, subject to his direction, to any other officer
or official of that agency, any power under this title.
‘‘(b) PROCUREMENTS FOR OR WITH OTHER AGEN-
CIES.—Subject to subsection (a), to facilitate the procure-
ment of property and services covered by this title by each
executive agency for any other executive agency, and to
facilitate joint procurement by those executive agencies—
‘‘(1) an agency head may, within his executive
agency, delegate functions and assign responsibilities
relating to procurement;
‘‘(2) the heads of two or more executive agen-
cies may by agreement delegate procurement func-
tions and assign procurement responsibilities from
one executive agency to another of those executive
agencies or to an officer or civilian employee of an-
other of those executive agencies; and
‘‘(3) the heads of two or more executive agen-
cies may create joint or combined offices to exercise
procurement functions and responsibilities.’’.
SEC. 1553. DETERMINATIONS AND DECISIONS.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 1552, is fur-
ther amended by inserting after section 33 the following
new section:
‘‘SEC. 34. DETERMINATIONS AND DECISIONS.
‘‘(a) INDIVIDUAL OR CLASS DETERMINATIONS AND
DECISIONS AUTHORIZED.—Determinations and decisions
required to be made under title III of the Federal Property
and Administration Services Act of 1949 (41 U.S.C. 251
et seq.) or chapter 137 of title 10, United States Code,
by an agency head may be made for an individual pur-
chase or contract or for a class of purchases or contracts.
Such determinations and decisions are final.
‘‘(b) WRITTEN FINDINGS REQUIRED.—(1) Each de-
termination under section 36(c) shall be based on a writ-
ten finding by the person making the determination or de-
cision. The finding shall set out facts and circumstances
that support the determination or decision.
‘‘(2) Each finding referred to in paragraph (1) shall
be final. The agency head making such finding shall main-
tain a copy of the finding for not less than 6 years after
the date of the determination or decision.’’.
SEC. 1554. RESEARCH, DEVELOPMENT, AND PRODUCTION
COSTS.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 1553, is fur-
ther amended by inserting after section 34 the following
new section:
‘‘SEC. 35. RESEARCH, DEVELOPMENT, AND PRODUCTION
COSTS.
‘‘(a) Letters of offer for the sale of defense articles
or for the sale of defense services that are issued pursuant
to sections 2761 or 2762 of title 22, United States Code,
shall not include any charge for the proportionate amount
of any nonrecurring costs of research, development, and
production of major defense equipment.
‘‘(b) Subsection (a) shall be effective with respect to
sales agreements entered into on or after October 1,
1996.’’.
SEC. 1555. REPEALS.
The laws of the United States are amended to read
as if the following sections of law had not been enacted:
(1) Section 630 of Public Law 102–393.
(2) Section 401 of Public Law 103–123.
SEC. 1556. COOPERATIVE PURCHASING.
Subsection (b) of section 201 of the Federal Property
and Administrative Services Act of 1949 (40 U.S.C. 481),
is amended to read as follows:
‘‘(b)(1) The Administrator shall, as far as prac-
ticable, provide any of the services specified in subsection
(a) of this section to any other Federal agency, mixed-
ownership Government corporation (as defined in section
9101 of title 31, United States Code), or the District of
Columbia, upon its request.
‘‘(2)(A) The Administrator may provide for the use
of Federal supply schedules or other contracts by any of
the following entities upon request:
‘‘(i) A State, any department or agency of a
State, and any political subdivision of a State, in-
cluding a local government.
‘‘(ii) The District of Columbia.
‘‘(iii) The Commonwealth of Puerto Rico.
‘‘(iv) The government of an Indian tribe (as de-
fined in section 4(e) of the Indian Self-Determina-
tion and Education Assistance Act (25 U.S.C.
450b(e))).
‘‘(B) Subparagraph (A) may not be construed to au-
thorize an entity referred to in that subparagraph to order
existing stock or inventory from federally owned and oper-
ated, or federally owned and contractor operated, supply
depots, warehouses, or similar facilities.
‘‘(3)(A) Upon the request of a qualified nonprofit
agency for the blind or other severely handicapped that
is to provide a commodity or service to the Federal Gov-
ernment under the Javits-Wagner-O’Day Act, the Admin-
istrator may provide any of the services specified in sub-
section (a) to such agency to the extent practicable.
‘‘(B) A nonprofit agency receiving services under the
authority of subparagraph (A) shall use the services di-
rectly in making or providing an approved commodity or
approved service to the Federal Government.
‘‘(C) In this paragraph:
‘‘(i) The term ‘qualified nonprofit agency for
the blind or other severely handicapped’ means—
‘‘(I) a qualified nonprofit agency for the
blind, as defined in section 5(3) of the Javits-
Wagner-O’Day Act (41 U.S.C. 48b(3)); and
‘‘(II) a qualified nonprofit agency for other
severely handicapped, as defined in section 5(4)
of such Act (41 U.S.C. 48b(4)).
‘‘(ii) The terms ‘approved commodity’ and ‘ap-
proved service’ mean a commodity and a service, re-
spectively, that has been determined by the Commit-
tee for Purchase from the Blind and Other Severely
Handicapped under section 2 of the Javits-Wagner-
O’Day Act (41 U.S.C. 47) to be suitable for pro-
curement by the Federal Government.
‘‘(iii) The term ‘Javits-Wagner-O’Day Act’
means the Act entitled ‘An Act to create a Commit-
tee on Purchases of Blind-made Products, and for
other purposes’, approved June 25, 1938 (41 U.S.C.
46–48c), commonly referred to as the Wagner-
O’Day Act, that was revised and reenacted in the
Act of June 23, 1971 (85 Stat. 77), commonly re-
ferred to as the Javits-Wagner-O’Day Act.’’.
TITLE II—CONTRACT
ADMINISTRATION
Subtitle A—Contract Payment
SEC. 2051. CONTRACT FINANCING.
(a) REORGANIZATION
OF PRINCIPAL AUTHORITY
PROVISION.—The Office of Federal Procurement Policy
Act (41 U.S.C. 401 et seq.), as amended by section 1554,
is further amended by inserting after section 35 the fol-
lowing new section:
‘‘SEC. 36. CONTRACT FINANCING.
‘‘(a) PAYMENT AUTHORITY.—Any executive agency
may—
‘‘(1) make advance, partial, progress or other
payments under contracts of property or services
made by the agency; and
‘‘(2) insert in bid solicitations for procurement
of property or services a provision limiting to small
business concerns advance or progress payments.
‘‘(b) PAYMENT AMOUNT.—Payments made under
subsection (a) may not exceed the unpaid contract price.
‘‘(c) SECURITY FOR ADVANCE PAYMENTS.—Advance
payments under subsection (a) may be made only upon
adequate security and a determination by the agency head
that to do so would be in the public interest. Such security
may be in the form of a lien in favor of the Government
on the property contracted for, on the balance in an ac-
count in which such payments are deposited, and on such
of the property acquired for performance of the contract
as the parties may agree. This lien shall be paramount
to all other liens.
‘‘(d) CONDITIONS FOR PROGRESS PAYMENTS.—(1)
The agency head shall ensure that any payment for work
in progress (including materials, labor, and other items)
under a contract of an executive agency that provides for
such payments is commensurate with the work accom-
plished that meets standards established under the con-
tract. The contractor shall provide such information and
evidence as the agency head determines necessary to per-
mit the agency head to carry out the preceding sentence.
‘‘(2) The agency head shall ensure that progress pay-
ments referred to in paragraph (1) are not made for more
than 80 percent of the work accomplished under the con-
tract so long as the agency head has not made the contrac-
tual terms, specifications, and price definite.
‘‘(3) This subsection applies to a contract for an
amount equal to or greater than the simplified acquisition
threshold.
‘‘(e) CONDITIONS FOR PAYMENTS FOR COMMERCIAL
ITEMS.—(1) Payments under subsection (a) for commer-
cial items, as that term is defined in section 4(12) of this
Act, may be made under such terms and conditions as the
head of the agency determines are appropriate or cus-
tomary in the commercial marketplace. The head of the
agency shall obtain adequate security for such payments.
If the security is in the form of a lien in favor of the Unit-
ed States, such lien is paramount to all other liens and
is effective immediately upon the first payment, without
filing, notice, or other action by the United States.
‘‘(2) Advance payments made under subsection (a)
for commercial items may include payments, in a total
amount of not more than 15 percent of the contract price,
in advance of any performance of work under the contract.
‘‘(3) The conditions of subsections (c) and (d) do not
apply to payments made for commercial items in accord-
ance with this subsection.
‘‘(f) ACTION IN CASE OF FRAUD.—(1) In any case
in which the remedy coordination official of an executive
agency finds that there is substantial evidence that the
request of a contractor for advance, partial, or progress
payment under a contract awarded by that executive agen-
cy is based on fraud, the remedy coordination official shall
recommend that the agency head reduce or suspend fur-
ther payments to such contractor.
‘‘(2) An agency head receiving a recommendation
under paragraph (1) in the case of a contractor’s request
for payment under a contract shall determine whether
there is substantial evidence that the request is based on
fraud. Upon making such a determination, the agency
head may reduce or suspend further payments to the con-
tractor under such contract.
‘‘(3) The extent of any reduction or suspension of
payments by an agency head under paragraph (2) on the
basis of fraud shall be reasonably commensurate with the
anticipated loss to the United States resulting from the
fraud.
‘‘(4) A written justification for each decision of the
agency head whether to reduce or suspend payments
under paragraph (2), and for each recommendation re-
ceived by the agency head in connection with such deci-
sion, shall be prepared and be retained in the files of the
executive agency.
‘‘(5) Each agency head shall prescribe procedures to
ensure that, before the agency head decides to reduce or
suspend payments in the case of a contractor under para-
graph (2), the contractor is afforded notice of the pro-
posed reduction or suspension and an opportunity to sub-
mit matters to the head of the agency in response to such
proposed reduction or suspension.
‘‘(6) Not later than 180 days after the date on which
an agency head reduces or suspends payments to a con-
tractor under paragraph (2), the remedy coordination offi-
cial of the executive agency shall—
‘‘(A) review the determination of fraud on
which the reduction or suspension is based; and
‘‘(B) transmit a recommendation to the agency
head whether the suspension or reduction should
continue.
‘‘(7) Each agency head who receives recommenda-
tions made by a remedy coordination official of the execu-
tive agency to reduce or suspend payments under para-
graph (2) during a fiscal year shall prepare for such year
a report that contains the recommendations, the actions
taken on the recommendations and the reasons for such
actions, and an assessment of the effects of such actions
on the Federal Government. Any such report shall be
available to any Member of Congress upon request.
‘‘(8) An agency head may not delegate responsibilities
under this subsection to any person in a position below
level IV of the Executive Schedule.
‘‘(9) In this subsection, the term ‘remedy coordina-
tion official’, with respect to an executive agency, means
the person or entity in that executive agency who coordi-
nates within that executive agency the administration of
criminal, civil, administrative, and contractual remedies
resulting from investigations of fraud or corruption related
to procurement activities.’’.
(b) RELATIONSHIP TO PROMPT PAYMENT REQUIRE-
MENTS.—Section 36 of the Office of Federal Procurement
Policy Act, as added by subsection (a) is not intended to
impair or modify procedures required by the provisions of
chapter 39 of title 31, United States Code, and the regula-
tions issued pursuant to such provisions of law, that relate
to progress payment requests, as such procedures are in
effect on the date of the enactment of this Act.
Subtitle B—Cost Principles
SEC. 2151. ALLOWABLE CONTRACT COSTS.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 2051, is fur-
ther amended by inserting after section 36 the following
new section:
‘‘SEC. 37. ALLOWABLE COSTS.
‘‘(a) INDIRECT COST THAT VIOLATES A FAR COST
PRINCIPLE.—The head of an executive agency shall re-
quire that a covered contract provide that if the contractor
submits to the executive agency a proposal for settlement
of indirect costs incurred by the contractor for any period
after such costs have been accrued and if that proposal
includes the submission of a cost which is unallowable be-
cause the cost violates a cost principle in the Federal Ac-
quisition Regulation or an executive agency’s supplement
to the Federal Acquisition Regulation, the cost shall be
disallowed.
‘‘(b) PENALTY
FOR VIOLATION
OF COST PRIN-
CIPLE.—(1) If the agency head determines that a cost
submitted by a contractor in its proposal for settlement
is expressly unallowable under a cost principle referred to
in subsection (a) that defines the allowability of specific
selected costs, the agency head shall assess a penalty
against the contractor in an amount equal to—
‘‘(A) the amount of the disallowed cost allo-
cated to covered contracts for which a proposal for
settlement of indirect costs has been submitted; plus
‘‘(B) interest (to be computed based on provi-
sions in the Federal Acquisition Regulation) to com-
pensate the United States for the use of any funds
which a contractor has been paid in excess of the
amount to which the contractor was entitled.
‘‘(2) If the agency head determines that a proposal
for settlement of indirect costs submitted by a contractor
includes a cost determined to be unallowable in the case
of such contractor before the submission of such proposal,
the agency head shall assess a penalty against the contrac-
tor in an amount equal to two times the amount of the
disallowed cost allocated to covered contracts for which a
proposal for settlement of indirect costs has been
submitted.
‘‘(c) WAIVER OF PENALTY.—In accordance with the
Federal Acquisition Regulation, the agency head may
waive a penalty under subsection (b) in the case of a con-
tractor’s proposal for settlement of indirect costs when—
‘‘(1) the contractor withdraws the proposal be-
fore the formal initiation of an audit of the proposal
by the Federal Government and resubmits a revised
proposal;
‘‘(2) the amount of unallowable costs subject to
the penalty is insignificant; or
‘‘(3) the contractor demonstrates, to the con-
tracting officer’s satisfaction, that—
‘‘(A) it has established appropriate policies
and personnel training and an internal control
and review system that provide assurances that
unallowable costs subject to penalties are pre-
cluded from being included in the contractor’s
proposal for settlement of indirect costs; and
‘‘(B) the unallowable costs subject to the
penalty were inadvertently incorporated into the
proposal.
‘‘(d) APPLICABILITY OF CONTRACT DISPUTES PRO-
CEDURE TO DISALLOWANCE OF COST AND ASSESSMENT
OF PENALTY.—An action of an agency head under sub-
section (a) or (b)—
‘‘(1) shall be considered a final decision for the
purposes of section 6 of the Contract Disputes Act
of 1978 (41 U.S.C. 605); and
‘‘(2) is appealable in the manner provided in
section 7 of such Act.
‘‘(e) SPECIFIC COSTS NOT ALLOWABLE.—(1) The
following costs are not allowable under a covered contract:
‘‘(A) Costs of entertainment, including amuse-
ment, diversion, and social activities, and any costs
directly associated with such costs (such as tickets
to shows or sports events, meals, lodging, rentals,
transportation, and gratuities).
‘‘(B) Costs incurred to influence (directly or in-
directly) legislative action on any matter pending be-
fore Congress or a State legislature.
‘‘(C) Costs incurred in defense of any civil or
criminal fraud proceeding or similar proceeding (in-
cluding filing of any false certification) brought by
the United States where the contractor is found lia-
ble or had pleaded nolo contendere to a charge of
fraud or similar proceeding (including filing of a
false certification).
‘‘(D) Payments of fines and penalties resulting
from violations of, or failure to comply with, Fed-
eral, State, local, or foreign laws and regulations, ex-
cept when incurred as a result of compliance with
specific terms and conditions of the contract or spe-
cific written instructions from the contracting officer
authorizing in advance such payments in accordance
with applicable provisions of the Federal Acquisition
Regulation.
‘‘(E) Costs of membership in any social, dining,
or country club or organization.
‘‘(F) Costs of alcoholic beverages.
‘‘(G) Contributions or donations, regardless of
the recipient.
‘‘(H) Costs of advertising designed to promote
the contractor or its products.
‘‘(I) Costs of promotional items and memora-
bilia, including models, gifts, and souvenirs.
‘‘(J) Costs for travel by commercial aircraft
which exceed the amount of the standard commercial
fare.
‘‘(K) Costs incurred in making any payment
(commonly known as a ‘golden parachute payment’)
which is—
‘‘(i) in an amount in excess of the normal
severance pay paid by the contractor to an em-
ployee upon termination of employment; and
‘‘(ii) is paid to the employee contingent
upon, and following, a change in management
control over, or ownership of, the contractor or
a substantial portion of the contractor’s assets.
‘‘(L) Costs of commercial insurance that pro-
tects against the costs of the contractor for correc-
tion of the contractor’s own defects in materials or
workmanship.
‘‘(M) Costs of severance pay paid by the con-
tractor to foreign nationals employed by the contrac-
tor under a service contract performed outside the
United States, to the extent that the amount of sev-
erance pay paid in any case exceeds the amount paid
in the industry involved under the customary or pre-
vailing practice for firms in that industry providing
similar services in the United States, as determined
under the Federal Acquisition Regulation.
‘‘(N) Costs of severance pay paid by the con-
tractor to a foreign national employed by the con-
tractor under a service contract performed in a for-
eign country if the termination of the employment of
the foreign national is the result of the closing of,
or the curtailment of activities at, a United States
facility in that country at the request of the govern-
ment of that country.
‘‘(O) Costs incurred by a contractor in connec-
tion with any criminal, civil, or administrative pro-
ceeding commenced by the United States or a State,
to the extent provided in subsection (k).
‘‘(2)(A) Pursuant to the Federal Acquisition Regula-
tion and subject to the availability of appropriations, the
agency head, in awarding a covered contract, may waive
the application of the provisions of paragraphs (1)(M) and
(1)(N) to that contract if the agency head determines
that—
‘‘(i) the application of such provisions to the
contract would adversely affect the continuation of a
program, project, or activity that provides significant
support services for employees of the executive agen-
cy posted outside the United States;
‘‘(ii) the contractor has taken (or has estab-
lished plans to take) appropriate actions within the
contractor’s control to minimize the amount and
number of incidents of the payment of severance pay
by the contractor to employees under the contract
who are foreign nationals; and
‘‘(iii) the payment of severance pay is necessary
in order to comply with a law that is generally appli-
cable to a significant number of businesses in the
country in which the foreign national receiving the
payment performed services under the contract or is
necessary to comply with a collective bargaining
agreement.
‘‘(B) The head of the executive agency concerned
shall include in the solicitation for a covered contract a
statement indicating—
‘‘(i) that a waiver has been granted under sub-
paragraph (A) for the contract; or
‘‘(ii) whether the agency head will consider
granting such a waiver, and, if the agency head will
consider granting a waiver, the criteria to be used in
granting the waiver.
‘‘(C) The agency head shall make the final determina-
tion regarding whether to grant a waiver under subpara-
graph (A) with respect to a covered contract before award
of the contract.
‘‘(3) The provisions of the Federal Acquisition Regu-
lation implementing this section may establish appropriate
definitions, exclusions, limitations, and qualifications.
‘‘(f) REQUIRED REGULATIONS.—(1) The Federal Ac-
quisition Regulation shall contain provisions on the allow-
ability of contractor costs. Such provisions shall define in
detail and in specific terms those costs which are unallow-
able, in whole or in part, under covered contracts. The
regulations shall, at a minimum, clarify the cost principles
applicable to contractor costs of the following:
‘‘(A) Air shows.
‘‘(B) Membership in civic, community, and pro-
fessional organizations.
‘‘(C) Recruitment.
‘‘(D) Employee morale and welfare.
‘‘(E) Actions to influence (directly or indirectly)
executive branch action on regulatory and contract
matters (other than costs incurred in regard to con-
tract proposals pursuant to solicited or unsolicited
bids).
‘‘(F) Community relations.
‘‘(G) Dining facilities.
‘‘(H) Professional and consulting services, in-
cluding legal services.
‘‘(I) Compensation.
‘‘(J) Selling and marketing.
‘‘(K) Travel.
‘‘(L) Public relations.
‘‘(M) Hotel and meal expenses.
‘‘(N) Expense of corporate aircraft.
‘‘(O) Company-furnished automobiles.
‘‘(P) Advertising.
‘‘(2) The Federal Acquisition Regulation shall require
that a contracting officer not resolve any questioned costs
until the contracting officer has obtained—
‘‘(A) adequate documentation with respect to
such costs; and
‘‘(B) the opinion of the executive agency’s con-
tract auditor on the allowability of such costs.
‘‘(3) The Federal Acquisition Regulation shall pro-
vide that, to the maximum extent practicable, an executive
agency’s contract auditor be present at any negotiation or
meeting with the contractor regarding a determination of
the allowability of indirect costs of the contractor.
‘‘(4) The Federal Acquisition Regulation shall require
that all categories of costs designated in the report of an
executive agency’s contract auditor as questioned with re-
spect to a proposal for settlement be resolved in such a
manner that the amount of the individual questioned costs
that are paid will be reflected in the settlement.
‘‘(g) APPLICABILITY
OF REGULATIONS
TO SUB-
CONTRACTORS.—The regulations referred to in sub-
sections (e) and (f)(1) shall require, to the maximum ex-
tent practicable, that such regulations apply to all sub-
contractors of a covered contract.
‘‘(h) CONTRACTOR CERTIFICATION REQUIRED.—(1)
A proposal for settlement of indirect costs applicable to
a covered contract shall include a certification by an offi-
cial of the contractor that, to the best of the certifying
official’s knowledge and belief, all indirect costs included
in the proposal are allowable. Any such certification shall
be in a form prescribed in the Federal Acquisition Regula-
tion.
‘‘(2) The agency head concerned may, in an excep-
tional case, waive the requirement for certification under
paragraph (1) in the case of any contract if the agency
head—
‘‘(A) determines in such case that it would be
in the interest of the United States to waive such
certification; and
‘‘(B) states in writing the reasons for that de-
termination and makes such determination available
to the public.
‘‘(i) PENALTIES FOR SUBMISSION OF COST KNOWN
AS NOT ALLOWABLE.—The submission to an executive
agency of a proposal for settlement of costs for any period
after such costs have been accrued that includes a cost
that is expressly specified by statute or regulation as being
unallowable, with the knowledge that such cost is unallow-
able, shall be subject to the provisions of section 287 of
title 18, United States Code, and section 3729 of title 31,
United States Code.
‘‘(j) CONTRACTOR TO HAVE BURDEN OF PROOF.—
In a proceeding before a board of contract appeals, the
United States Court of Federal Claims, or any other Fed-
eral court in which the reasonableness of indirect costs for
which a contractor seeks reimbursement from the United
States is in issue, the burden of proof shall be upon the
contractor to establish that those costs are reasonable.
‘‘(k) PROCEEDING COSTS NOT ALLOWABLE.—(1)
Except as otherwise provided in this subsection, costs in-
curred by a contractor in connection with any criminal,
civil, or administrative proceeding commenced by the
United States or a State are not allowable as reimbursable
costs under a covered contract if the proceeding (A) re-
lates to a violation of, or failure to comply with, a Federal
or State statute or regulation, and (B) results in a disposi-
tion described in paragraph (2).
‘‘(2) A disposition referred to in paragraph (1)(B) is
any of the following:
‘‘(A) In the case of a criminal proceeding, a
conviction (including a conviction pursuant to a plea
of nolo contendere) by reason of the violation or fail-
ure referred to in paragraph (1).
‘‘(B) In the case of a civil or administrative
proceeding involving an allegation of fraud or similar
misconduct, a determination of contractor liability
on the basis of the violation or failure referred to in
paragraph (1).
‘‘(C) In the case of any civil or administrative
proceeding, the imposition of a monetary penalty by
reason of the violation or failure referred to in para-
graph (1).
‘‘(D) A final decision—
‘‘(i) to debar or suspend the contractor,
‘‘(ii) to rescind or void the contract, or
‘‘(iii) to terminate the contract for default,
by reason of the violation or failure referred to in
paragraph (1).
‘‘(E) A disposition of the proceeding by consent
or compromise if such action could have resulted in
a disposition described in subparagraph (A), (B),
(C), or (D).
‘‘(3) In the case of a proceeding referred to in para-
graph (1) that is commenced by the United States and
is resolved by consent or compromise pursuant to an
agreement entered into by a contractor and the United
States, the costs incurred by the contractor in connection
with such proceeding that are otherwise not allowable as
reimbursable costs under such paragraph may be allowed
to the extent specifically provided in such agreement.
‘‘(4) In the case of a proceeding referred to in para-
graph (1) that is commenced by a State, the agency head
that awarded the covered contract involved in the proceed-
ing may allow the costs incurred by the contractor in con-
nection with such proceeding as reimbursable costs if the
agency head determines, in accordance with the Federal
Acquisition Regulation, that the costs were incurred as a
result of (A) a specific term or condition of the contract,
or (B) specific written instructions of the agency.
‘‘(5)(A) Except as provided in subparagraph (C),
costs incurred by a contractor in connection with a crimi-
nal, civil, or administrative proceeding commenced by the
United States or a State in connection with a covered con-
tract may be allowed as reimbursable costs under the con-
tract if such costs are not disallowable under paragraph
(1), but only to the extent provided in subparagraph (B).
‘‘(B)(i) The amount of the costs allowable under sub-
paragraph (A) in any case may not exceed the amount
equal to 80 percent of the amount of the costs incurred,
to the extent that such costs are determined to be other-
wise allowable and allocable under the Federal Acquisition
Regulation.
‘‘(ii) Regulations issued for the purpose of clause (i)
shall provide for appropriate consideration of the complex-
ity of procurement litigation, generally accepted principles
governing the award of legal fees in civil actions involving
the United States as a party, and such other factors as
may be appropriate.
‘‘(C) In the case of a proceeding referred to in sub-
paragraph (A), contractor costs otherwise allowable as re-
100
imbursable costs under this paragraph are not allowable
if (i) such proceeding involves the same contractor mis-
conduct alleged as the basis of another criminal, civil, or
administrative proceeding, and (ii) the costs of such other
proceeding are not allowable under paragraph (1).
‘‘(6) In this subsection:
‘‘(A) The term ‘proceeding’ includes an inves-
tigation.
‘‘(B) The term ‘costs’, with respect to a pro-
ceeding—
‘‘(i) means all costs incurred by a contrac-
tor, whether before or after the commencement
of any such proceeding; and
‘‘(ii) includes—
‘‘(I) administrative and clerical ex-
penses;
‘‘(II) the cost of legal services, includ-
ing legal services performed by an em-
ployee of the contractor;
‘‘(III) the cost of the services of ac-
countants and consultants retained by the
contractor; and
‘‘(IV) the pay of directors, officers,
and employees of the contractor for time
101
devoted by such directors, officers, and em-
ployees to such proceeding.
‘‘(C) The term ‘penalty’ does not include res-
titution, reimbursement, or compensatory damages.
‘‘(l) COVERED CONTRACT DEFINED.—(1) In this sec-
tion, the term ‘covered contract’ means a contract for an
amount in excess of $500,000 that is entered into by an
executive agency, except that such term does not include
a fixed-price contract without cost incentives or any con-
tract for the purchase of commercial items (as defined in
section 4(12).
‘‘(2) Effective on October 1 of each year that is divis-
ible by 5, the amount set forth in paragraph (1) shall be
adjusted to the amount that is equal to the fiscal year
1994 constant dollar value of the amount set forth. An
amount, as so adjusted, that is not evenly divisible by
$50,000 shall be rounded to the nearest multiple of
$50,000. In the case of an amount that is evenly divisible
by $25,000 but is not evenly divisible by $50,000, the
amount shall be rounded to the next higher multiple of
$50,000.’’.
SEC. 2152. TRAVEL EXPENSES OF GOVERNMENT CONTRAC-
TORS.
Section 24(a) of the Office of Federal Procurement
Policy Act (41 U.S.C. 420) is amended by inserting after
102
‘‘Under any contract’’ the following: ‘‘requiring submis-
sion of cost or pricing data or the negotiation of final indi-
rect costs’’.
Subtitle C—Audit and Access to
Records
SEC. 2251. AUTHORITY TO EXAMINE RECORDS OF CON-
TRACTORS.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 2151, is fur-
ther amended by inserting after section 37 the following
new section:
‘‘SEC. 38. EXAMINATION OF RECORDS OF CONTRACTOR.
‘‘(a) AGENCY AUTHORITY.—The head of an executive
agency, acting through an authorized representative—
‘‘(1) is entitled to inspect the plant and audit
the records of—
‘‘(A) a contractor performing a cost-reim-
bursement, incentive, time-and-materials, labor-
hour, or price-redeterminable contract, or any
combination of such contracts, made by that ex-
ecutive agency under this title; and
‘‘(B) a subcontractor performing any cost-
reimbursement, incentive, time-and-materials,
labor-hour, or price-redeterminable subcontract
under a contract referred to in subparagraph
103
(A) or under any combination of such contracts;
and
‘‘(2) shall, for the purpose of evaluating the ac-
curacy, completeness, and currency of cost or pricing
data required to be submitted pursuant to section 32
with respect to a contract or subcontract, have the
right to examine all records of the contractor or sub-
contractor related to—
‘‘(A) the proposal for the contract or sub-
contract;
‘‘(B) the discussions conducted on the pro-
posal;
‘‘(C) pricing of the contract or subcontract;
or
‘‘(D) performance of the contract or sub-
contract.
‘‘(b) LIMITATION ON PREAWARD AUDITS RELATING
TO INDIRECT COSTS.—The head of an agency may not
perform a preaward audit to evaluate proposed indirect
costs under any contract, subcontract, or modification to
be entered into in accordance with this chapter in any case
in which the contracting officer determines that the objec-
tives of the audit can reasonably be met by accepting the
results of an audit conducted by any other department or
104
agency of the Federal Government within one year preced-
ing the date of the contracting officer’s determination.
‘‘(c) COMPTROLLER GENERAL AUTHORITY.—(1) Ex-
cept as provided in paragraph (2), each contract awarded
after using procedures other than sealed bid procedures
shall provide that the Comptroller General and his rep-
resentatives are entitled to examine any records of the
contractor, or any of its subcontractors, that directly per-
tain to, and involve transactions relating to, the contract
or subcontract.
‘‘(2) Paragraph (1) does not apply to a contract or
subcontract with a foreign contractor or foreign sub-
contractor if the agency head concerned determines, with
the concurrence of the Comptroller General or his des-
ignee, that the application of that paragraph to the con-
tract or subcontract would not be in the public interest.
However, the concurrence of the Comptroller General or
his designee is not required—
‘‘(A) where the contractor or subcontractor is a
foreign government or agency thereof or is precluded
by the laws of the country involved from making its
records available for examination; and
‘‘(B) where the agency head determines, after
taking into account the price and availability of the
property and services from United States sources,
105
that the public interest would be best served by not
applying paragraph (1).
‘‘(3) Paragraph (1) may not be construed to require
a contractor or subcontractor to create or maintain any
record that the contractor or subcontractor does not main-
tain in the ordinary course of business or pursuant to an-
other provision of law.
‘‘(d) LIMITATION.—The right of an agency head
under subsection (a), and the right of the Comptroller
General under subsection (c), with respect to a contract
or subcontract shall expire three years after final payment
under such contract or subcontract.
‘‘(e) INAPPLICABILITY TO CERTAIN CONTRACTS.—
This section is inapplicable to contracts for utility services
at rates not exceeding those established to apply uniformly
to the public, plus any applicable reasonable connection
charge.
‘‘(f) FORMS OF ORIGINAL RECORD STORAGE.—Noth-
ing in this section shall be construed to preclude a contrac-
tor from duplicating or storing original records in elec-
tronic form.
‘‘(g) USE OF IMAGES OF ORIGINAL RECORDS.—The
head of an agency shall not require a contractor or sub-
contractor to provide original records in an audit carried
out pursuant to this section if the contractor or sub-
106
contractor provides photographic or electronic images of
the original records and meets the following requirements:
‘‘(1) The contractor or subcontractor has estab-
lished procedures to ensure that the imaging process
preserves the integrity, reliability, and security of
the original records.
‘‘(2) The contractor or subcontractor maintains
an effective indexing system to permit timely and
convenient access to the imaged records.
‘‘(3) The contractor or subcontractor retains
the original records for a minimum of one year after
imaging to permit periodic validation of the imaging
systems.
‘‘(h) RECORDS DEFINED.—In this section, the term
‘records’ includes books, documents, accounting proce-
dures and practices, and other data, regardless of type and
regardless of whether such items are in written form, in
the form of computer data, or in any other form.’’.
Subtitle D—Cost Accounting
Standards
SEC. 2301. REPEAL OF OBSOLETE DEADLINE REGARDING
PROCEDURAL REGULATIONS FOR THE COST
ACCOUNTING STANDARDS BOARD.
Section 26(f)(3) of the Office of Federal Procurement
Policy Act (41 U.S.C. 422(f)(3)) is amended in the first
107
sentence by striking out ‘‘Not later than 180 days after
the date of the enactment of this section, the Adminis-
trator’’ and inserting in lieu thereof ‘‘The Administrator’’.
TITLE III—SIMPLIFIED ACQUISI-
TION THRESHOLD AND SO-
CIOECONOMIC, SMALL BUSI-
NESS, AND MISCELLANEOUS
LAWS
Subtitle A—Simplified Acquisition
Threshold
PART I—ESTABLISHMENT OF THRESHOLD
SEC. 3001. ESTABLISHMENT OF SIMPLIFIED ACQUISITION
THRESHOLD.
(a) ESTABLISHMENT.—The Office of Federal Pro-
curement Policy Act (41 U.S.C. 401 et seq.) is amended
by inserting after section 4 the following new section:
‘‘SEC. 4A. SIMPLIFIED ACQUISITION THRESHOLD.
‘‘(a) IN
GENERAL.—The simplified acquisition
threshold for purposes of Federal acquisitions is (except
as provided in subsection (b)) the amount of $25,000, as
adjusted pursuant to subsection (c).
‘‘(b) AGENCIES WITH FACNET SYSTEM.—In the
case of an agency for which there is in effect a certification
under section 39A of the Office of Federal Procurement
Policy Act with respect to implementation of a FACNET
108
system, the simplified acquisition threshold is the amount
of $100,000, as adjusted pursuant to subsection (c).
‘‘(c) PERIODIC ADJUSTMENT FOR INFLATION.—The
dollar amount in effect under subsection (a) shall be ad-
justed on October 1 of each year divisible by 5 to the
equivalent amount in constant fiscal year 1990 dollars
(rounded to the nearest $1,000). The dollar amount in ef-
fect under subsection (b) shall be adjusted on October 1
of each year divisible by 5 to the equivalent amount in
constant fiscal year 1993 dollars (rounded to the nearest
$1,000).
‘‘(d) SPECIAL
RULE
FOR
CONTINGENCY
OPER-
ATIONS.—In the case of a contract to be awarded and per-
formed, or a purchase to be made, outside the United
States in support of a contingency operation (as defined
in section 101(a)(13) of title 10, United States Code), the
amounts in effect under subsections (a) and (b) shall be
two times the amounts otherwise applicable.’’.
(b) CONFORMING AMENDMENT TO DEFINITION.—
Section 4(11) of such Act is amended to read as follows:
‘‘(11) The term ‘small purchase threshold’
means the simplified acquisition threshold estab-
lished by section 4A.’’.
109
SEC. 3002. FEDERAL ACQUISITION COMPUTER NETWORK.
(a) FEDERAL ACQUISITION COMPUTER NETWORK.—
The Office of Federal Procurement Policy Act (41 U.S.C.
401 et seq.), as amended by section 2251, is further
amended by adding after section 38 the following new sec-
tion:
‘‘SEC. 39. FEDERAL ACQUISITION COMPUTER NETWORK
(FACNET).
‘‘(a) IN GENERAL.—(1) The Administrator shall es-
tablish a program for the development and implementation
of a Federal acquisition computer network system archi-
tecture. Any system developed in accordance with this ar-
chitecture shall be known as a ‘FACNET system’. The
Administrator shall assign a program manager for the
FACNET system and shall provide for overall direction
of policy and leadership in the development, coordination,
installation, operation, and completion of implementation
of the FACNET system by executive agencies.
‘‘(2) The FACNET system architecture shall involve
enabling technology and procurement electronic data
interchange transaction sets. The enabling technology
shall consist of computer network capabilities, supporting
data bases, and standard interfaces that interconnect Fed-
eral Government automated systems to the network. The
procurement electronic data interchange transaction sets
shall facilitate the electronic interchange of standard pro-
110
curement information between Federal Government and
industry automated acquisition systems.
‘‘(3) In carrying out paragraph (1), the Adminis-
trator shall consult with the Office of Information and
Regulatory Affairs.
‘‘(4) The Administrator shall carry out paragraph (1)
not later than the date that is 3 years after the date of
enactment of the Federal Acquisition Reform Act of 1994.
‘‘(b) FUNCTIONS OF FACNET.—The FACNET sys-
tem architecture shall have the capacity to carry out the
following functions:
‘‘(1) GOVERNMENT FUNCTIONS.—
‘‘(A) Provide widespread public notice of
solicitations for contract opportunities issued by
an executive agency and of orders to be made
by the agency.
‘‘(B) Allow responses to solicitations and
requests for information to be submitted to the
procuring activity through such system.
‘‘(C) Allow public notice of contract
awards to be provided through such system.
‘‘(D) In cases in which it is practicable,
allow questions regarding solicitations to be an-
swered through such system.
111
‘‘(E) Allow orders to be made through
such system.
‘‘(F) In cases in which it is practicable,
make payments to contractors by bank card,
electronic funds transfer, or other automated
methods.
‘‘(G) Archive data relating to each pro-
curement action made using such system.
‘‘(2) USER FUNCTIONS.—Allow private users to
electronically—
‘‘(A) access notice of solicitations for con-
tract opportunities issued by an agency and of
orders to be made by the agency;
‘‘(B) selectively access and review solicita-
tions and orders issued by the agency;
‘‘(C) respond to solicitations and notices of
orders issued by the agency;
‘‘(D) receive orders from the agency;
‘‘(E) 
access 
information 
on 
contract
awards made by the agency; and
‘‘(F) in cases in which it is practicable, re-
ceive payment by bank card, electronic funds
transfer, or other automated means.
‘‘(3) GENERAL FUNCTIONS.—
112
‘‘(A) Allow the electronic exchange of pro-
curement information between the private sec-
tor and the Federal Government.
‘‘(B) Employ nationally and internationally
recognized data formats that serve to broaden
and ease the electronic interchange of data.
‘‘(C) Allow convenient and universal user
access through a single point of entry.
‘‘(c) FUNCTIONS OF ADMINISTRATOR OF GENERAL
SERVICES.—The Administrator of General Services shall
do the following:
‘‘(1) Provide technical support for FACNET
systems by doing the following:
‘‘(A) Coordinate with the Administrator to
facilitate the efficient and widespread imple-
mentation of various FACNET systems by ex-
ecutive agencies. This shall include interfacing
FACNET systems to other systems, such as the
Federal Government bank card and Electronic
Funds Transfer payment systems.
‘‘(B) Assist the Director of the National
Institute of Standards and Technology in the
development and application of appropriate
Federal Information Processing Standards.
113
‘‘(C) Prepare a technical plan for coordi-
nating the design, development, implementation,
operation, and maintenance of the FACNET
system architecture. The plan shall include
roles and responsibilities, major milestones, cost
estimates, and performance requirements.
‘‘(2) Ensure compliance with section 111 of the
Federal Property and Administrative Services Act of
1949 in the implementation of FACNET systems by
executive agencies, including by limiting the scope of
delegations under subsection (a) of that section.
‘‘(3) Evaluate progress by executive agencies in
implementing FACNET systems, and recommend
changes in that implementation to the program
manager assigned by the Administrator under sub-
section (a).
‘‘(4) Submit to the Congress, on the date that
is one year after the date of the enactment of the
Federal Acquisition Reform Act of 1994 and on that
date in each of the 3 years thereafter, a report on
the overall progress by the executive branch of the
Federal Government and by each executive agency in
implementing the FACNET system architecture.
114
‘‘(d) FUNCTIONS
OF
NATIONAL
INSTITUTE
OF
STANDARDS AND TECHNOLOGY.—The Director of the Na-
tional Institute of Standards and Technology shall—
‘‘(1) ensure that the FACNET system architec-
ture complies with Federal Information Processing
Standards;
‘‘(2) 
issue 
additional 
standards 
for 
the
FACNET system architecture as necessary; and
‘‘(3) establish tests to facilitate the aims of this
section and support policies established by the Ad-
ministrator under this section.’’.
(b) TECHNICAL AMENDMENTS.—Section 18 of the
Office of Federal Procurement Policy Act (41 U.S.C. 416)
is amended—
(1) in subsection (a)(1)(A), by striking out ‘‘no-
tice’’ in the matter following clause (ii) and inserting
in lieu thereof ‘‘notice of solicitation’’; and
(2) in subsection (d), by striking out ‘‘a notice
under subsection (e)’’ in the first sentence and in-
serting in lieu thereof ‘‘a notice of solicitation under
subsection (a)’’.
SEC. 3003. IMPLEMENTATION IN EXECUTIVE AGENCIES.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 3002, is fur-
115
ther amended by adding after section 39 the following new
section:
‘‘SEC. 39A. IMPLEMENTATION OF FACNET SYSTEMS.
‘‘(a) IMPLEMENTATION OF FACNET SYSTEMS.—(1)
The head of each executive agency shall implement the
Federal acquisition computer network (‘FACNET’) sys-
tems required by section 39.
‘‘(2) In implementing the FACNET systems pursu-
ant to paragraph (1), the head of an executive agency shall
consult with the Administrator for Federal Procurement
Policy and the Administrator for General Services.
‘‘(b) DESIGNATION
OF AGENCY PROGRAM MAN-
AGER.—(1) The head of each executive agency shall des-
ignate a program manager to have responsibility for imple-
mentation of FACNET systems for that agency and other-
wise to implement this section.
‘‘(2) A program manager designated under this sub-
section for an executive agency shall—
‘‘(A) report directly to the senior procurement
executive designated for the agency under section
16(4);
‘‘(B) be responsible for the timely and cost-ef-
fective implementation of the FACNET system ar-
chitecture for the agency in a manner that is respon-
sive to the procurement needs of the agency, na-
116
tional business needs, and the public’s interest in
open government;
‘‘(C) develop plans for phasing-in the implemen-
tation of FACNET systems for the procuring activi-
ties of the executive agency and phasing-out local
network systems that perform comparable procure-
ment functions;
‘‘(D) participate in the interagency development
of standard procurement electronic data interchange
transaction sets; and
‘‘(E) in carrying out this section, comply with
guidelines issued by the Administrator under this
section and program directives issued by the Admin-
istrator of General Services under section 111 of the
Federal Property and Administrative Services Act of
1949.
‘‘(c) CERTIFICATION
OF FACNET SYSTEM.—(1)
When the senior procurement official of an executive agen-
cy determines that a procuring activity of the agency has
implemented an interim FACNET system (as defined in
subsection (f)), the senior procurement official shall certify
to the Administrator for Federal Procurement Policy that
the agency has implemented an interim FACNET system.
‘‘(2) When the head of an executive agency, with the
concurrence of the Administrator for Federal Procurement
117
Policy, determines that the agency has implemented a full
FACNET system (as defined in subsection (g)), the head
of the agency shall certify to Congress that the agency
has implemented a full FACNET system.
‘‘(3) The head of each executive agency shall provide
for implementation of both interim FACNET system and
full FACNET system, with priority on providing conven-
ient and universal user access as required by section
39(b)(3)(C), in that agency as soon as practicable after
the date of the enactment of the Federal Acquisition Re-
form Act of 1994.
‘‘(d) HIGHER SIMPLIFIED ACQUISITION THRESHOLD
WHEN FACNET SYSTEM CERTIFIED.—A certification to
the Administrator or Congress under subsection (c) shall
be considered to be a certification for purposes of the high-
er simplified acquisition threshold under section 4A(b), ex-
cept that a certification under paragraph (1) of subsection
(c) shall not constitute such a certification in the case of
solicitations issued after the end of the three-year period
beginning on the date of the enactment of the Federal Ac-
quisition Reform Act of 1994.
‘‘(e) EXEMPTION FROM NOTICE PROVISIONS.—An
executive agency is exempt from the requirements of sec-
tion 18(a)(1) of the Office of Federal Procurement Policy
Act (41 U.S.C. 416(a)(1)) if the senior procurement offi-
118
cial of the agency makes the certification described in sub-
section (c)(1).
‘‘(f) IMPLEMENTATION OF INTERIM FACNET SYS-
TEM.—A procuring activity shall be considered to have im-
plemented an interim FACNET system if—
‘‘(1) with respect to each procurement expected
to be in an amount less than the simplified acquisi-
tion threshold, the procuring activity has imple-
mented the FACNET functions described in para-
graphs (1)(A) and (2)(A) of section 39(b), as in ef-
fect on the effective date of section 3002 of the Fed-
eral Acquisition Reform Act of 1994; and
‘‘(2) with respect to each procurement expected
to be in an amount less than the simplified acquisi-
tion threshold, the procuring activity issues notices
of solicitations through a system with those func-
tions for all contracting opportunities other than in
cases covered by section 18(c).
‘‘(g) IMPLEMENTATION
OF FULL FACNET SYS-
TEM.—(1) An executive agency shall be considered to have
implemented a full FACNET system if (except in the case
of procuring activities (or portions thereof) of the agency
for which the head of the agency determines that imple-
mentation is not cost effective or practicable) the executive
agency has implemented all of the FACNET functions de-
119
scribed in section 39(b), as in effect on the effective date
of section 3002 of the Federal Acquisition Reform Act of
1994.
‘‘(2) For purposes of paragraph (1), an executive
agency may not be considered to have implemented a full
FACNET system if—
‘‘(A) the head of the agency has determined
that implementation of FACNET system is not cost
effective or practicable in the case of certain procur-
ing activities (or portions thereof) of the agency; and
‘‘(B) the percentage of the procurement actions
executed by those procuring activities (or portions
thereof) for the preceding fiscal year is greater than
25 percent of the total number of procurement ac-
tions executed by the agency for that year.
‘‘(h) PROCURING
ACTIVITIES
ORIGINALLY
EX-
CLUDED IN CERTIFICATION.—(1) If the head of an execu-
tive agency, in certifying under subsection (c) that the
agency has implemented a full FACNET system, deter-
mines that such implementation is not cost effective or
practicable in the case of any procuring activity (or por-
tion thereof) of that agency, then that certification shall
not apply under section 4A(b) to any procurement action
by that procuring activity (or portion thereof).
120
‘‘(2) If the head of an executive agency determines
that a full FACNET system has subsequently been imple-
mented for that procuring activity (or portion thereof), the
head of the agency shall make a certification to Adminis-
trator for Federal Procurement Policy in the same manner
as a certification under paragraph (2) of subsection (c),
and such certification shall have the same effect with re-
spect to that procuring activity (or portion thereof) as if
made under such paragraph of subsection (c).’’.
PART II—SIMPLIFICATION OF PROCEDURES
SEC. 3011. SIMPLIFIED ACQUISITION PROCEDURES.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 3001, is fur-
ther amended by inserting after section 4A the following
new section:
‘‘SEC. 4B. SIMPLIFIED ACQUISITION PROCEDURES.
‘‘(a) 
SIMPLIFIED
PROCEDURES
REQUIRED.—In
order to promote efficiency and economy in contracting
and to avoid unnecessary burdens for agencies and con-
tractors, the Federal Acquisition Regulation shall provide
for special simplified procedures for contracts for acquisi-
tion of property and services that are not in excess of the
simplified acquisition threshold.
‘‘(b) DIVISION OF CONTRACTS PROHIBITED.—A pro-
posed purchase or contract for an amount above the sim-
121
plified acquisition threshold may not be divided into
several purchases or contracts for lesser amounts in order
to use the simplified acquisition procedures required by
subsection (a).
‘‘(c) PROMOTION OF COMPETITION.—In using sim-
plified acquisition procedures, the head of an executive
agency shall promote competition to the maximum extent
practicable.’’.
SEC. 3012. SMALL BUSINESS PROVISIONS.
(a) INTERIM REPORTING RULE.—Notwithstanding
section 4A of the Office of Federal Procurement Policy
Act, as added by section 3001, during the 3-year period
beginning on the date of the issuance in final form of revi-
sions to the Federal Acquisition Regulation under section
4C of the Office of Federal Procurement Policy Act, as
added by section 3013, procuring activities shall continue
to report, pursuant to section 19(d) of the Office of Fed-
eral Procurement Policy Act (41 U.S.C. 417(d)), procure-
ment awards with a dollar value of at least $25,000, but
less than $100,000, in conformity with the procedures for
the reporting of a contract award in excess of $25,000
in effect on November 18, 1993.
(b) FUNCTIONS OF ADMINISTRATOR FOR FEDERAL
PROCUREMENT POLICY.—Section 6(d) of the Office of
122
Federal Procurement Policy Act (41 U.S.C. 405(d)) is
amended—
(1) in paragraph (7), by striking out ‘‘and’’
after the semicolon at the end; and
(2) by redesignating paragraph (8) as para-
graph (10) and inserting after paragraph (7) the fol-
lowing:
‘‘(8) developing policies, in consultation with
the Administrator of the Small Business Administra-
tion, that ensure that small businesses and small
businesses owned and controlled by socially and eco-
nomically disadvantaged persons are provided with
the maximum practicable opportunities to partici-
pate in procurements that are conducted for
amounts below the simplified acquisition threshold;
‘‘(9) developing policies that will promote
achievement of goals for participation by small busi-
nesses and small businesses owned and controlled by
socially and economically disadvantaged individuals;
and’’.
SEC. 3013. PROCEDURES FOR PURCHASES BELOW MICRO-
PURCHASE THRESHOLD.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 3011, is fur-
123
ther amended by inserting after section 4B the following
new section:
‘‘SEC. 
4C. 
PROCEDURES 
APPLICABLE 
TO 
PURCHASES
BELOW MICRO-PURCHASE THRESHOLD.
‘‘(a) REQUIREMENTS.—(1) The head of each execu-
tive agency shall ensure that procuring activities of that
agency, in awarding a contract with a price exceeding the
micro-purchase threshold, comply with the requirements
of section 8(a) of the Small Business Act (15 U.S.C.
637(a)) and section 45 of this Act.
‘‘(2) The authority under part 13.106(a)(1) of the
Federal Acquisition Regulation (48 C.F.R. 13.106(a)(1)),
as in effect on November 18, 1993, to make purchases
without securing competitive quotations does not apply to
any purchases with a price exceeding the micro-purchase
threshold.
‘‘(3) The head of each executive agency shall ensure
that procuring activities of that agency comply with the
requirements of section 40, relating to the small business
reserve.
‘‘(b) CERTAIN CONTRACTING OFFICIALS NOT TO BE
CONSIDERED PROCUREMENT OFFICIALS.—Any civilian
officer or employee, and any member of the Armed Forces,
who has authority to enter into contracts but whose con-
tracting authority is limited to the amount of the micro-
124
purchase threshold or less is not a procurement official
as defined in paragraph (3)(A) of section 27(p).
‘‘(c) IMPLEMENTATION THROUGH FAR.—The provi-
sions of subsections (a) and (b) shall be implemented
through the Federal Acquisition Regulation.
‘‘(d) MICRO-PURCHASE THRESHOLD DEFINED.—For
purposes of this subsection, the micro-purchase threshold
is the amount of $2,500, adjusted on October 1 of each
year divisible by 5 to the equivalent amount in constant
fiscal year 1993 dollars (rounded to the nearest $100).’’.
SEC. 3014. PROCUREMENT NOTICE.
(a) CONTINUATION OF EXISTING NOTICE THRESH-
OLDS.—Subsection (a) of section 18 of the Office of Fed-
eral Procurement Policy Act (41 U.S.C. 416) is amended
as follows:
(1) Paragraph (1) is amended—
(A) by striking out ‘‘the small purchase
threshold’’ each place it appears and inserting
in lieu thereof ‘‘the simplified acquisition
threshold’’;
(B) by striking out ‘‘(c)—’’ in the matter
preceding subparagraph (A) and inserting in
lieu thereof ‘‘(c):’’;
125
(C) by striking out ‘‘an executive’’ at the
beginning of subparagraphs (A) and (C) and in-
serting in lieu thereof ‘‘An executive’’;
(D) by striking out the semicolon at the
end of subparagraph (A) and inserting in lieu
thereof a period; and
(E) by amending subparagraph (B) to read
as follows:
‘‘(B) An executive agency intending to solicit
(including orally or by any other means) bids or pro-
posals for a contract for property or services for a
price expected to exceed $10,000 but not to exceed
the simplified acquisition threshold shall post a no-
tice of solicitation described in subsection (b). The
notice shall be posted at the contracting office issu-
ing the solicitation or shall be made available
through an electronic system with a FACNET sys-
tem that at least meets the requirements of para-
graphs (1)(A) and (2)(A) of section 39(b). The no-
tice shall be posted for a period of not less than 10
days, except that in the case of a posting made
through an electronic system with such a FACNET
system, the posting may be for a period of less than
10 days as prescribed in the Federal Acquisition
Regulation.’’.
126
(2) Paragraph (3)(B) is amended by inserting
after ‘‘(B)’’ the following: ‘‘in the case of a contract
or order for an amount expected to exceed the sim-
plified acquisition threshold,’’.
(b) OPPORTUNITY FOR ALL RESPONSIBLE POTEN-
TIAL OFFERORS.—Such subsection is further amended by
adding at the end the following:
‘‘(4) An executive agency intending to solicit offers
for a contract for which a notice of solicitation is required
to be posted under paragraph (1)(B) shall ensure that all
potential offerors are permitted to respond to the solicita-
tion for the contract within the period of time specified
in the solicitation for the submission of offers.’’.
(c) ESTABLISHMENT OF DEADLINE FOR SUBMISSION
OF OFFERS.—Such subsection is further amended by in-
serting after paragraph (4), as added by subsection (b),
the following new paragraph:
‘‘(5) An executive agency shall establish a deadline
for the submission of all bids or proposals in response to
a notice of solicitation with respect to which no such dead-
line is provided by statute.’’.
(d) EXCEPTIONS.—Subsection (c) of such section is
amended by adding at the end the following new para-
graph:
127
‘‘(4)(A) The requirements of subsection (a)(1) shall
not apply in the case of an acquisition accomplished
through the use of an electronic system within a FACNET
system, as described in section 39 and certified under sec-
tion 39A.
‘‘(B) The Federal Acquisition Regulation shall pro-
vide for minimum periods of time for submission of offers
for acquisitions described in subparagraph (A). Such peri-
ods shall provide offerors a reasonable opportunity to re-
spond.
‘‘(C) A notice of solicitation of bids or proposals for
an acquisition described in subparagraph (A) shall include
the matter described in under subsection (b).’’.
SEC. 3015. SMALL BUSINESS RESERVATION.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 3003, is fur-
ther amended by adding after section 39A the following
new section:
‘‘SEC. 40. CONTRACTS: SMALL BUSINESS RESERVATION.
‘‘(a) REQUIREMENT.—Each contract for the procure-
ment of property and services that has an anticipated
value not in excess of $100,000 shall be reserved exclu-
sively for small business concerns unless the contracting
officer is unable to obtain offers from two or more small
business concerns that (1) are competitive with market
128
prices, and (2) are competitive with regard to the quality
and delivery of the goods or services being procured.
‘‘(b) OFFERS TO BE CONSIDERED.—In carrying out
subsection (a), a contracting officer shall consider any
offer that is responsive and that is received in a timely
manner from an eligible small business offeror.
‘‘(c) RELATIONSHIP TO OTHER LAWS.—Nothing in
subsection (a) shall be construed as precluding an award
of a contract with a value not in excess of $100,000 under
the authority of section 45 of this Act and section 12 of
the Business Opportunity Development Reform Act of
1988 (Public Law 100–656; 15 U.S.C. 644 note).
‘‘(d) PAYMENT TERMS AND DISBURSEMENT.—In the
case of contracts referred to in subsection (a) that are en-
tered into with small business concerns, contracting offi-
cers shall, wherever circumstances permit, provide for the
use of fast payment terms and the disbursement of pay-
ment through electronic fund transfer.’’.
SEC. 3016. GAO TEST AND REPORT ON PERFORMANCE OF
SIMPLIFIED ACQUISITION THRESHOLD.
(a) PERFORMANCE TEST.—The Comptroller General
of the United States shall collect data and assess the ef-
fects of the simplified acquisition threshold, as established
in section 4A of the Office of Federal Procurement Policy
Act, on the participation of small business concerns (in-
129
cluding small business concerns owned and controlled by
socially and economically disadvantaged individuals) in
procurement awards of less than $100,000 and the bene-
fits and detriments, if any, to the procuring activities of
the various Executive agencies.
(b) DATA TO BE COLLECTED.—Data collected under
subsection (a) shall include data regarding whether the es-
tablishment of the simplified acquisition threshold has im-
proved the acquisition process in terms of reduced paper-
work, financial or other savings to the Federal Govern-
ment, and any increase in the number of contractors par-
ticipating in the contracting process.
(c) PERIOD.—Data shall be collected for purposes of
subsection (a) during the period beginning with the first
full fiscal year quarter after the effective date of the
amendments made by section 3001 and ending on Septem-
ber 30, 1997.
(d) REPORT.—By March 1, 1998, the Comptroller
General shall submit to the Committee on Government
Operations of the House of Representatives, the Commit-
tee on Governmental Affairs of the Senate, and the Com-
mittees on Small Business of the House of Representatives
and the Senate a report on the effects of the establishment
of the simplified acquisition threshold by the amendments
made by section 3001.
130
PART III—INAPPLICABILITY OF LAWS TO, AND
WAIVER OF LAWS FOR, ACQUISITIONS NOT
IN EXCESS OF SIMPLIFIED ACQUISITION
THRESHOLD
SEC. 3021. INAPPLICABILITY OF FUTURE ENACTED PRO-
CUREMENT LAWS TO CONTRACTS NOT EX-
CEEDING 
THE 
SIMPLIFIED 
ACQUISITION
THRESHOLD.
Section 4A of the Office of Federal Procurement Pol-
icy Act, as added by section 3001, is amended by adding
at the end the following new subsection:
‘‘(e) CONSTRUCTION WITH FUTURE ENACTMENTS.—
A provision of law enacted after the date of the enactment
of the Federal Acquisition Reform Act of 1994 shall not
be construed as applicable to purchases of property or
services by an executive agency for an amount not in ex-
cess of the simplified acquisition threshold unless that pro-
vision of law specifically refers to this section and specifi-
cally states that such provision of law modifies or super-
sedes this section.’’.
SEC. 3022. AUTHORITY TO WAIVE CERTAIN PROCUREMENT
LAWS FOR CONTRACTS NOT EXCEEDING THE
SIMPLIFIED ACQUISITION THRESHOLD.
Section 4A of the Office of Federal Procurement Pol-
icy Act, as amended by section 3021, is further amended
by adding at the end the following new subsection:
131
‘‘(f) AUTHORITY TO WAIVE CERTAIN PROCUREMENT
LAWS.—
‘‘(1) IN GENERAL.—Subject to paragraphs (2)
and (3), the Federal Acquisition Regulatory Council
may waive any provision of law subject to implemen-
tation by the Council or by an executive agency
under section 25 of this Act that sets forth policies,
procedures, requirements, restrictions, or contract
clauses that are not necessary to implement any of
the Governmental policies set forth in paragraph (2)
under a contract in an amount not greater than the
simplified acquisition threshold. Any waiver under
this subsection shall apply to the procurement by ex-
ecutive agencies of property and services not in ex-
cess of the simplified acquisition threshold.
‘‘(2) DETERMINATION
REQUIRED.—The Fed-
eral Acquisition Regulatory Council may waive a
provision of law under this section only if the Coun-
cil determines that the waiver will not adversely af-
fect—
‘‘(A) national security interests;
‘‘(B) the economy, efficiency, and effective-
ness of Federal procurement;
‘‘(C) full and open competition;
132
‘‘(D) the Federal Government’s ability to
obtain property and services of the requisite
quality, at a reasonable price, and within the
time needed;
‘‘(E) small and small disadvantaged busi-
ness concerns; or
‘‘(F) fair dealings and equitable relation-
ships with the private sector.
‘‘(3) LIMITATIONS.—The Federal Acquisition
Regulatory Council may not under this section waive
a requirement that is established by statute or regu-
lation under any of the following provisions:
‘‘(A) Section 2533 of title 10, United
States Code (relating to limitation on procure-
ment of goods which are other than American
goods).
‘‘(B) Section 2631 of title 10, United
States Code (relating to preference to United
States vessels for transportation of supplies).
‘‘(C) The Small Business Act (15 U.S.C.
631 et seq.).
‘‘(D) Section 4124 of title 18, United
States Code (relating to purchase of prison-
made products by Federal departments).
133
‘‘(E) Title 18, United States Code, and
any other law imposing a criminal penalty.
‘‘(F) Section 503 of the Rehabilitation Act
of 1973 (29 U.S.C. 793) (relating to employ-
ment under Federal contracts for individuals
with disabilities).
‘‘(G) Section 4212 of title 38, United
States Code (relating to veterans’ employment
emphasis under Federal contracts).
‘‘(H) The Act of August 24, 1935 (40
U.S.C. 270a et seq.), commonly referred to as
the ‘Miller Act’.
‘‘(I) The Act of March 3, 1931 (40 U.S.C.
276a et seq.), commonly referred to as the
‘Davis-Bacon Act’.
‘‘(J) Title IX of the Federal Property and
Administrative Services Act of 1949 (40 U.S.C.
541 et seq.), popularly referred to as the
‘Brooks Architect-Engineers Act’.
‘‘(K) Section 111 of the Federal Property
and Administrative Services Act of 1949 (40
U.S.C. 759), popularly referred to as the
‘Brooks Automatic Data Processing Act’.
134
‘‘(L) Section 901(b) of the Merchant Ma-
rine Act, 1936 (46 U.S.C. app. 1241(b)) (relat-
ing to cargo preference for American vessels).
‘‘(M) Title III of the Act of March 3, 1933
(41 U.S.C. 10a et seq.), commonly referred to
as the ‘Buy American Act’.
‘‘(N) The Act of June 25, 1938 (41 U.S.C.
46 et seq.), commonly referred to as the Wag-
ner-O’Day Act, that was revised and reenacted
in the Act of June 23, 1971 (85 Stat. 77), com-
monly referred to as the ‘Javits-Wagner-O’Day
Act’.
‘‘(O) The Service Contract Act of 1965
(41 U.S.C. 351–358).
‘‘(P) Section 27 of this Act (41 U.S.C.
423), other than subsection (e) of that section
(relating to procurement integrity).
‘‘(Q) Executive Order No. 11246 (or any
successor to that order), dated September 24,
1965.’’.
PART IV—REVISION OF REGULATIONS
SEC. 3081. REVISION REQUIRED.
(a) FEDERAL ACQUISITION REGULATION.—(1) Not
later than one year after the date of the enactment of this
Act, the Federal Acquisition Regulatory Council estab-
135
lished by section 25(a) of the Office of Federal Procure-
ment Policy Act (41 U.S.C. 421(a)) shall—
(A) review the Federal Acquisition Regulation
to identify regulations that are applicable to acquisi-
tions in excess of a specified amount that is less
than $100,000; and
(B) amend the regulations so identified as nec-
essary to provide that such regulations do not apply
to acquisitions that are not in excess of the sim-
plified acquisition threshold.
(2) Paragraph (1) does not apply in the case of a
regulation for which such an amendment would not be in
the national interest, as determined by the Council.
(b) SUPPLEMENTAL REGULATIONS.—Not later than
90 days after the date on which the review required by
subsection (a) is completed, the head of each executive
agency that has issued regulations, policies, or procedures
referred to in section 25(c)(2) of the Office of Federal
Procurement Policy Act (41 U.S.C. 421(c)(2)) shall—
(1) identify any such regulation, policy, or pro-
cedure that is applicable to acquisitions in excess of
a specified amount that is less than $100,000; and
(2) pursuant to section 22 of such Act (41
U.S.C. 418b), publish amendments to the regula-
tions so identified as necessary to provide that such
136
regulations, policies, and procedures do not apply to
acquisitions that are not in excess of the simplified
acquisition threshold.
(c) DEFINITIONS.—In this section:
(1) The term ‘‘simplified acquisition threshold’’
has the meaning given such term in section 4A of
the Office of Federal Procurement Policy Act, as
added by section 3001.
(2) The term ‘‘executive agency’’ has the mean-
ing given such term in section 3(a) of the Federal
Property and Administrative Services Act of 1949
(41 U.S.C. 472(b)).
Subtitle B—Socioeconomic and
Small Business Laws
SEC. 3101. PAYMENT PROTECTIONS FOR SUBCONTRAC-
TORS AND SUPPLIERS.
(a) REGULATIONS.—
(1) IN GENERAL.—The Administrator for Fed-
eral Procurement Policy shall prescribe in regula-
tions the requirements described in paragraph (2).
(2) PROCEDURES
RELATING
TO
COMPLIANCE
WITH PAYMENT TERMS.—(A) Under procedures es-
tablished in the regulations, upon the assertion by a
subcontractor or supplier of a contractor performing
a Government contract that the subcontractor or
137
supplier has not been paid by the prime contractor
in accordance with the payment terms of the sub-
contract, purchase order, or other agreement with
the prime contractor, the contracting officer may de-
termine the following:
(i) With respect to a construction contract,
whether the contractor has made progress pay-
ments to the subcontractor or supplier in com-
pliance with chapter 39 of title 31, United
States Code.
(ii) With respect to a contract other than
a construction contract, whether the contractor
has made progress or other payments to the
subcontractor or supplier in compliance with
the terms of the subcontract, purchase order, or
other agreement with the prime contractor.
(iii) With respect to either a construction
contract or a contract other than a construction
contract, whether the contractor has made final
payment to the subcontractor or supplier in
compliance with the terms of the subcontract,
purchase order, or other agreement with the
prime contractor.
(iv) With respect to either a construction
contract or a contract other than a construction
138
contract, whether any certification of payment
of the subcontractor or supplier accompanying
the contractor’s payment request to the Govern-
ment is accurate.
(B) If the contracting officer determines that
the prime contractor is not in compliance with any
matter referred to in clause (i), (ii), or (iii) of sub-
paragraph (A), the contracting officer may, under
procedures established in the regulations—
(i) encourage the prime contractor to make
timely payment to the subcontractor or sup-
plier; or
(ii) reduce or suspend progress payments
with respect to amounts due to the prime con-
tractor.
(C) If the contracting officer determines that a
certification referred to in clause (iv) of subpara-
graph (A) is inaccurate in any material respect, the
contracting officer shall, under procedures estab-
lished in the regulations, initiate appropriate admin-
istrative or other remedial action.
(D) This paragraph shall apply with respect to
any Government contract that is in effect on the
date of promulgation of the regulations under this
subsection or that is awarded after such date.
139
(b) INAPPLICABILITY
TO CERTAIN CONTRACTS.—
The regulations prescribed under this section shall not
apply to the following contracts:
(1) A contract that is for an amount not in ex-
cess of the simplified acquisition threshold (within
the meaning of section 4A of the Office of Federal
Procurement Policy Act).
(2) A contract for the acquisition of commercial
items (as that term is defined in section 4(12) of the
Office of Federal Procurement Policy Act.
(c) REGULATIONS DEADLINES.—(1) The Adminis-
trator for Federal Procurement Policy shall publish pro-
posed regulations under subsection (a) not later than 180
days after the date of the enactment of this Act.
(2) The Administrator shall publish final regulations
under subsection (a) not later than 270 days after the date
of the enactment of this Act.
SEC. 3102. SMALL BUSINESS PROCUREMENT ADVISORY
COUNCIL.
(a) ESTABLISHMENT.—There is hereby established
an interagency council to be known as the ‘‘Small Busi-
ness Procurement Advisory Council’’ (hereinafter in this
section referred to as the ‘‘Council’’).
(b) DUTIES.—The duties of the Council are—
140
(1) to serve as a forum for discussion of issues
and problems relating to, and ideas for improvement
of, small business procurement matters within the
Federal Government;
(2) to provide information to other departments
and agencies of the Federal Government about small
business procurement; and
(3) to issue advisory reports to the Small Busi-
ness Administration and the Office of Federal Pro-
curement Policy on small business procurement mat-
ters.
(c) MEMBERSHIP.—The Council shall be composed of
the following members:
(1) The Administrator of the Small Business
Administration (or the designee of the Adminis-
trator).
(2) The Administrator for Federal Procurement
Policy (or the designee of the Administrator).
(3) The Director of the Minority Business De-
velopment Agency.
(4) The head of each Office of Small and Dis-
advantaged Business Utilization in each Federal
agency having procurement powers.
(d) CO-CHAIRMEN.—The Council shall be co-chaired
by the Administrator of the Small Business Administra-
141
tion and the Administrator for Federal Procurement Pol-
icy.
(e) MEETINGS.—The Council shall meet at the call
of the chairmen, but not less often than four times a year
and once each quarter.
(f) DIRECTOR.—The Chief Counsel for Advocacy of
the Small Business shall serve as the director of the Coun-
cil. The director may not vote on matters before the coun-
cil except in the case of a tie vote among the members.
The duties of the director shall be determined by the
chairmen of the Council. The Chief Counsel for Advocacy
shall receive no additional pay by reason of the counsel’s
service as director of the Council.
(g) ANNUAL REPORT.—Not later than 30 days after
the end of each fiscal year, the Council shall submit to
Congress a report detailing the activities of the Council
in the preceding fiscal year in carrying out this section.
Subtitle C—Miscellaneous
Acquisition Laws
SEC. 3151. RESTRICTION ON USE OF NONCOMPETITIVE
PROCEDURES FOR PROCUREMENT FROM A
SPECIFIED SOURCE.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 3015, is fur-
142
ther amended by adding at the end the following new sec-
tion:
‘‘SEC. 41. RESTRICTION ON USE OF NONCOMPETITIVE PRO-
CEDURES FOR PROCUREMENT FROM A SPEC-
IFIED SOURCE.
‘‘(a) POLICY.—It is the policy of Congress that no
legislation should be enacted that requires a procurement
by an executive agency to be made from a specified non-
Federal Government source.
‘‘(b) CONDITIONS.—A provision of law may not be
construed as requiring a procurement by an executive
agency to be made from a specified non-Federal Govern-
ment source unless that provision of law—
‘‘(1) specifically refers to this subsection;
‘‘(2) specifically identifies the particular non-
Federal Government source involved; and
‘‘(3) specifically states that the procurement
from that source is required by such provision of law
in contravention of the policy set forth in subsection
(a).’’.
SEC. 3152. REPEAL OF OBSOLETE PROVISION.
Section 308 of the Federal Property and Administra-
tive Services Act of 1949 (41 U.S.C. 258) is repealed.
143
TITLE IV—STANDARDS OF
CONDUCT
SEC. 4001. CONTRACTING FUNCTIONS PERFORMED BY FED-
ERAL PERSONNEL.
(a) AMENDMENT OF OFPP ACT.—The Office of Fed-
eral Procurement Policy Act, as amended by section 1092,
is further amended by inserting after section 22 the fol-
lowing new section 23:
‘‘SEC. 23. CONTRACTING FUNCTIONS PERFORMED BY FED-
ERAL PERSONNEL.
‘‘(a) LIMITATION ON PAYMENT FOR ADVISORY AND
ASSISTANCE SERVICES.—(1) No person who is not an em-
ployee may be paid by an agency for services to conduct
evaluations or analyses of any aspect of a proposal submit-
ted for an acquisition unless employees with adequate
training and capabilities to perform such evaluations and
analyses are not readily available within the agency or an-
other Federal agency, as determined in accordance with
standards and procedures prescribed in the Federal Acqui-
sition Regulation.
‘‘(2) In the administration of this subsection, the
head of each agency shall determine in accordance with
the standards and procedures set forth in the Federal Ac-
quisition Regulation whether—
144
‘‘(A) a sufficient number of employees within
the agency or another Federal agency are readily
available to perform a particular evaluation or analy-
sis for the agency head making the determination;
and
‘‘(B) the readily available employees have the
training and capabilities necessary to perform the
evaluation or analysis.
‘‘(b) DEFINITION.—For purposes of this section, the
term ‘employee’ has the meaning given such term in sec-
tion 2105 of title 5, United States Code.’’.
(b) REQUIREMENT
FOR GUIDANCE
AND REGULA-
TIONS.—
(1) GUIDANCE AND REGULATIONS REQUIRED.—
The Federal Acquisition Regulatory Council estab-
lished by section 25(a) of the Office of Federal Pro-
curement Policy Act (41 U.S.C. 421(a)) shall—
(A) review part 37 of title 48 of the Code
of Federal Regulations as it relates to the use
of advisory and assistance services; and
(B) provide guidance and promulgate regu-
lations regarding—
(i) what actions Federal agencies are
required to take to determine whether ex-
pertise is readily available within the Fed-
145
eral Government before contracting for ad-
visory and technical services to conduct ac-
quisitions; and
(ii) the manner in which Federal em-
ployees with expertise may be shared with
agencies needing expertise for such acquisi-
tions.
(2) DEFINITION.—In paragraph (1), the term
‘‘employee’’ has the meaning given such term in sec-
tion 2105 of title 5, United States Code.
SEC. 4002. REPEAL OF EXECUTED REQUIREMENT FOR
STUDY AND REPORT.
Section 17 of the Office of Federal Procurement Pol-
icy Act (41 U.S.C. 415) is repealed.
SEC. 4003. INTERESTS OF MEMBERS OF CONGRESS.
Section 3741 of the Revised Statutes (41 U.S.C. 22)
is amended to read as follows:
‘‘No member of Congress shall be admitted to any
share or part of any contract or agreement made, entered
into, or accepted by or on behalf of the United States,
or to any benefit to arise thereupon.’’.
SEC. 4004. WAITING PERIOD FOR SIGNIFICANT CHANGES
PROPOSED FOR ACQUISITION REGULATIONS.
Section 22(a) of the Office of Federal Procurement
Policy Act (41 U.S.C. 418b) is amended—
146
(1) by striking out ‘‘30 days’’ and inserting in
lieu thereof ‘‘60 days’’; and
(2) by adding at the end the following: ‘‘Not-
withstanding the preceding sentence, such a policy,
regulation, procedure, or form may take effect ear-
lier than 60 days after the publication date when
there are compelling circumstances for the earlier ef-
fective date, but in no event may that effective date
be less than 30 days after the publication date.’’.
TITLE V—COMMERCIAL ITEMS
SEC. 5001. DEFINITIONS.
(a) DEFINITIONS.—Section 4 of the Office of Federal
Procurement Policy Act (41 U.S.C. 403) is amended by
adding at the end the following new paragraphs:
‘‘(12) The term ‘commercial item’ means any of
the following:
‘‘(A) Any item of a type customarily used
in the course of normal business operations for
other than Federal Government purposes,
that—
‘‘(i) has been sold, leased, or licensed
to the general public or to domestic State,
or local government entities; or
147
‘‘(ii) has been offered for sale, lease,
or license to the general public or to do-
mestic State, or local government entities.
‘‘(B) An item intended to be used in the
course of normal business operations for other
than Federal Government purposes that is not
yet available in the commercial marketplace,
but will be available in time to satisfy the deliv-
ery requirements under a Federal Government
solicitation.
‘‘(C) Any item that, but for—
‘‘(i) modifications of a type customar-
ily available in the commercial market-
place, or
‘‘(ii) minor modifications made to
meet Federal Government requirements,
would satisfy the criteria in subparagraph (A)
or (B).
‘‘(D) Any combination of items meeting
the requirements of subparagraph (A), (B), or
(C) that are of a type customarily combined
and sold in combination to the general public.
‘‘(E) Installation services, maintenance
services, repair services, training services, and
other services if such services are procured for
148
support of an item referred to in subparagraph
(A), (B), (C), or (D) and if the source of such
services—
‘‘(i) offers such services to the general
public and the Federal Government con-
temporaneously and under similar terms
and conditions; and
‘‘(ii) offers to use the same work force
for providing the Federal Government with
such services as the source uses for provid-
ing such services to the general public.
‘‘(F) Services offered and sold competi-
tively, in significant quantities, in the commer-
cial marketplace at established catalog prices or
standard rates and under standard commercial
terms and conditions.
‘‘(G) Any item, combination of items, or
service referred to in subparagraphs (A)
through (F) notwithstanding the fact that the
item, combination of items, or service is trans-
ferred between or among separate divisions,
subsidiaries, or affiliates of a contractor.
‘‘(13) The term ‘nondevelopmental item’ means
any of the following:
‘‘(A) Any commercial item.
149
‘‘(B) Any previously developed item of sup-
ply that is in use by a department or agency of
the United States, a State or local government,
or a foreign government with which the United
States has a mutual defense cooperation agree-
ment.
‘‘(C) Any item of supply described in sub-
paragraph (B) that requires only minor modi-
fication of the type normally available in the
commercial marketplace in order to meet the
requirements of the procuring department or
agency.
‘‘(D) Any item of supply currently being
produced that does not meet the requirements
of subparagraph (A), (B), or (C) solely because
the item—
‘‘(i) is not yet in use; or
‘‘(ii) is not yet available in the com-
mercial marketplace.
‘‘(14) The term ‘component’ means any item
supplied to the Federal Government as part of an
end item or of another component.
‘‘(15) The term ‘commercial component’ means
any component that is a commercial item.’’.
150
(b) CONFORMING AMENDMENTS.—Such section is
further amended—
(1) by striking out ‘‘Act—’’ and inserting in
lieu thereof ‘‘Act:’’;
(2) by capitalizing the initial letter in the first
word of each paragraph;
(3) by striking out the semicolon at the end of
each of paragraphs (1), (2), (3), (5), (6), (7), (8),
and (9) and inserting in lieu thereof a period; and
(4) in paragraphs (4) and (10), by striking out
‘‘; and’’ at the end and inserting in lieu thereof a
period.
SEC. 5002. PREFERENCE FOR ACQUISITION OF COMMER-
CIAL ITEMS.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 3151, is fur-
ther amended by adding at the end the following new sec-
tion:
‘‘SEC. 42. PREFERENCE FOR ACQUISITION OF COMMERCIAL
ITEMS.
‘‘(a) PREFERENCE.—The head of each executive
agency shall ensure that, to the maximum extent prac-
ticable—
151
‘‘(1) requirements of the executive agency with
respect to a procurement of supplies or services are
stated in terms of—
‘‘(A) functions to be performed;
‘‘(B) performance required; or
‘‘(C) essential physical characteristics;
‘‘(2) such requirements are defined so that
commercial items or, to the extent that commercial
items suitable to meet the agency’s needs are not
available, other nondevelopmental items may be pro-
cured to fulfill such requirements; and
‘‘(3) offerors of commercial items and other
nondevelopmental items are provided an opportunity
to compete in any procurement to fill such require-
ments.
‘‘(b) IMPLEMENTATION.—The head of each executive
agency shall ensure that procurement officials in that ex-
ecutive agency, to the maximum extent practicable—
‘‘(1) 
acquire 
commercial 
items 
or 
other
nondevelopmental items to meet the needs of the ex-
ecutive agency;
‘‘(2) require prime contractors and subcontrac-
tors at all levels under the executive agency con-
tracts to incorporate commercial items or other
152
nondevelopmental items as components of items sup-
plied to the executive agency;
‘‘(3) modify requirements in appropriate cases
to ensure that the requirements can be met by com-
mercial items or, to the extent that commercial
items suitable to meet the agency’s needs are not
available, other nondevelopmental items;
‘‘(4) state specifications in terms that enable
and encourage bidders and offerors to supply com-
mercial items or, to the extent that commercial
items suitable to meet the agency’s needs are not
available, other nondevelopmental items in response
to the executive agency solicitations;
‘‘(5) revise the executive agency’s procurement
policies, practices, and procedures not required by
law to reduce any impediments in those policies,
practices, and procedures to the acquisition of com-
mercial items; and
‘‘(6) require training of appropriate personnel
in the acquisition of commercial items.
‘‘(c) PRELIMINARY MARKET RESEARCH.—(1) The
head of an executive agency shall conduct market research
appropriate to the circumstances—
‘‘(A) before developing new specifications for a
procurement by that executive agency; and
153
‘‘(B) before soliciting bids or proposals for a
contract in excess of the simplified acquisition
threshold.
‘‘(2) The head of an executive agency shall use the
results of market research to determine whether there are
commercial items available that—
‘‘(A) meet the executive agency’s requirements;
‘‘(B) could be modified to meet the executive
agency’s requirements; or
‘‘(C) could meet the executive agency’s require-
ments if those requirements were modified to a rea-
sonable extent.’’.
SEC. 5003. ACQUISITION OF COMMERCIAL ITEMS.
(a) REQUIRED FAR PROVISIONS.—The Office of
Federal Procurement Policy Act (41 U.S.C. 401 et seq.),
as amended by section 5002, is further amended by adding
at the end the following new section:
‘‘SEC. 43. REGULATIONS ON ACQUISITION OF COMMERCIAL
ITEMS.
‘‘(a) IN GENERAL.—The Federal Acquisition Regula-
tion shall provide regulations to implement section 42 and
paragraphs (12) through (15) of section 4.
‘‘(b) TERMS AND CONDITIONS.—The regulations pre-
scribed under subsection (a) shall contain a set or sets
of terms and conditions to be included in contracts for
154
the acquisition of commercial end items. Such terms and
conditions shall, to the maximum extent practicable, in-
clude only those contract clauses that are determined by
the agency head to be—
‘‘(1) required to implement provisions of law
applicable to commercial item acquisitions; or
‘‘(2) consistent with standard commercial prac-
tice.
‘‘(c) TERMS AND CONDITIONS FOR COMPONENTS.—
Such regulations shall provide that a prime contractor fur-
nishing commercial items or items other than commercial
items as items or components shall not be required to
apply to any of its divisions, subsidiaries, or affiliates or
any of its subcontractors or suppliers that are furnishing
commercial items as components any clause, term, or con-
dition except those determined by the head of the agency
to be—
‘‘(1) required to implement provisions of law
applicable to subcontractors furnishing commercial
items; or
‘‘(2) determined to be consistent with standard
commercial practice.
‘‘(d) MARKET ACCEPTANCE.—The regulations pre-
scribed under subsection (a) shall provide that, under ap-
propriate conditions, the agency head may require an
155
offeror to demonstrate, as a condition for being considered
responsive, that the items offered meet, among other cri-
teria, market acceptance criteria, unless such item has
been satisfactorily supplied to an executive agency under
current or recent contracts for the same or similar require-
ments.
‘‘(e) USE OF FIXED PRICE CONTRACTS.—The regu-
lations prescribed under subsection (a) shall include a re-
quirement that firm, fixed price contracts, or fixed price
contracts with economic price adjustment provisions, be
used for the acquisition of commercial items and compo-
nents.
‘‘(f) TERM OF CONTRACTS.—The regulations pre-
scribed under subsection (a) shall provide that, to the ex-
tent practicable, contracts for acquisition of commercial
items shall not require contract performance for a term
longer than customary industry practice for the item being
acquired. A contracting officer may include in a contract
provisions for economic price adjustment if an extended
period of performance under the contract cannot be avoid-
ed.
‘‘(g) CONTRACT
QUALITY
REQUIREMENTS.—The
regulations prescribed under subsection (a) shall include
provisions that—
156
‘‘(1) permit, to the maximum extent prac-
ticable, a contractor under a commercial items ac-
quisition to use the existing quality assurance sys-
tem of the contractor as a substitute for compliance
with an otherwise applicable requirement for the
Government to inspect or test the commercial items
before the contractor’s tender of those items for ac-
ceptance by the Government;
‘‘(2) require that, to the maximum extent prac-
ticable, the executive agency take advantage of war-
ranties (including extended warranties) offered by
offerors of commercial items and use such warran-
ties for the repair and replacement of commercial
items; and
‘‘(3) set forth guidance regarding the use of
past performance of commercial items and sources
as a factor in contract award decisions.’’.
SEC. 5004. PRINCIPLE OF CONSTRUCTION WITH FUTURE
LAWS.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 5003, is fur-
ther amended by adding at the end the following new sec-
tion:
157
‘‘SEC. 44. PRINCIPLE OF CONSTRUCTION WITH FUTURE
LAWS.
‘‘A provision of law enacted after the date of the en-
actment of the Federal Acquisition Reform Act of 1994
shall not be construed as applicable to purchases of com-
mercial items by an executive agency unless that provision
of law specifically refers to this section and specifically
states that such provision of law modifies or supersedes
section 42, section 43, section 44, or paragraphs (12)
through (15) of section 4.’’.
SEC. 5005. AUTHORITY TO WAIVE CERTAIN PROCUREMENT
LAWS FOR CONTRACTS FOR COMMERCIAL
ITEMS.
The Office of Federal Procurement Policy Act (41
U.S.C. 401 et seq.), as amended by section 5004, is fur-
ther amended by adding at the end the following new sec-
tion:
‘‘SEC. 45. AUTHORITY TO WAIVE CERTAIN PROCUREMENT
LAWS FOR CONTRACTS FOR COMMERCIAL
ITEMS.
‘‘(a) IN GENERAL.—Subject to subsections (b) and
(c), the Federal Acquisition Regulatory Council may waive
any provision of law subject to implementation by the
Council or by an executive agency under section 25 of this
Act that sets forth policies, procedures, requirements, re-
strictions, or contract clauses that are not necessary to
158
implement any of the Governmental policies set forth in
subsection (b) under a contract for commercial items. Any
waiver under this subsection shall apply to the procure-
ment by executive agencies of commercial items.
‘‘(b) DETERMINATION REQUIRED.—The Federal Ac-
quisition Regulatory Council may waive a provision of law
under this section only if the Council determines that the
waiver will not adversely affect—
‘‘(1) national security interests;
‘‘(2) the economy, efficiency, and effectiveness
of Federal procurement;
‘‘(3) full and open competition;
‘‘(4) the Federal Government’s ability to obtain
property and services of the requisite quality, at a
reasonable price, and within the time needed;
‘‘(5) small and small disadvantaged business
concerns; or
‘‘(6) fair dealings and equitable relationships
with the private sector.
‘‘(c) LIMITATIONS.—The Federal Acquisition Regu-
latory Council may not under this section waive a require-
ment that is established by statute or regulation under
any of the following provisions:
159
‘‘(1) Section 2533 of title 10, United States
Code (relating to limitation on procurement of goods
which are other than American goods).
‘‘(2) Section 2631 of title 10, United States
Code (relating to preference to United States vessels
for transportation of supplies).
‘‘(3) The Small Business Act (15 U.S.C. 631 et
seq.).
‘‘(4) Section 4124 of title 18, United States
Code (relating to purchase of prison-made products
by Federal departments).
‘‘(5) Title 18, United States Code, and any
other law imposing a criminal penalty.
‘‘(6) Section 503 of the Rehabilitation Act of
1973 (29 U.S.C. 793) (relating to employment
under Federal contracts for individuals with disabil-
ities).
‘‘(7) Section 1352 of title 31, United States
Code, popularly referred to as the ‘Byrd Amend-
ment’.
‘‘(8) Section 4212 of title 38, United States
Code (relating to veterans’ employment emphasis
under Federal contracts).
160
‘‘(9) The Act of August 24, 1935 (40 U.S.C.
270a et seq.), commonly referred to as the ‘Miller
Act’.
‘‘(10) The Act of March 3, 1931 (40 U.S.C.
276a et seq.), commonly referred to as the ‘Davis-
Bacon Act’.
‘‘(11) Title IX of the Federal Property and Ad-
ministrative Services Act of 1949 (40 U.S.C. 541 et
seq.), popularly referred to as the ‘Brooks Architect-
Engineers Act’.
‘‘(12) Section 111 of the Federal Property and
Administrative Services Act of 1949 (40 U.S.C.
759), popularly referred to as the ‘Brooks Automatic
Data Processing Act’.
‘‘(13) Section 901(b) of the Merchant Marine
Act, 1936 (46 U.S.C. app. 1241(b)) (relating to
cargo preference for American vessels).
‘‘(14) Title III of the Act of March 3, 1933 (41
U.S.C. 10a et seq.), commonly referred to as the
‘Buy American Act’.
‘‘(15) The Act of June 25, 1938 (41 U.S.C. 46
et seq.), commonly referred to as the Wagner-O‘Day
Act, that was revised and reenacted in the Act of
June 23, 1971 (85 Stat. 77), commonly referred to
as the ‘Javits-Wagner-O’Day Act’.
161
‘‘(16) The Service Contract Act of 1965 (41
U.S.C. 351–358).
‘‘(17) Section 27 of this Act (41 U.S.C. 423),
other than subsection (e) of that section (relating to
procurement integrity).
‘‘(18) Executive Order No. 11246 (or any suc-
cessor to that order), dated September 24, 1965.’’.
SEC. 5006. FLEXIBLE DEADLINES FOR SUBMISSION OF OF-
FERS OF COMMERCIAL ITEMS.
Section 18(a) of the Office of Federal Procurement
Policy Act (41 U.S.C. 416(a)) is amended by adding at
the end the following new paragraph:
‘‘(4) The requirements of paragraph (3)(B) do not
apply to contracts for the purchase of commercial items.
The Administrator shall prescribe for such contracts ap-
propriate limits on the applicability of a deadline for sub-
mission of bids or proposals that is required by subsection
(a)(1). Such limits shall be incorporated in the Federal
Acquisition Regulation.’’.
SEC. 5007. ADDITIONAL RESPONSIBILITIES FOR ADVO-
CATES FOR COMPETITION.
(a) RESPONSIBILITIES OF THE ADVOCATE FOR COM-
PETITION.—Section 20(c) of the Office of Federal Pro-
curement Policy Act (41 U.S.C. 418(c)) is amended to
read as follows:
162
‘‘(c) The advocate for competition for each procuring
activity shall be responsible for promoting full and open
competition, promoting the acquisition of commercial
items and other nondevelopmental items, and challenging
barriers to such acquisition, including such barriers as un-
necessarily restrictive statements of need, unnecessarily
detailed specifications, and unnecessarily burdensome con-
tract clauses.’’.
(b) REPEAL OF SUPERSEDED PROVISION.—Section
28 of such Act (41 U.S.C. 424) is repealed.
SEC. 5008. PROVISIONS NOT AFFECTED.
Nothing in this title shall be construed as amending,
modifying, or superseding, or as intended to impair or re-
strict authorities or responsibilities under—
(1) section 46 of the Office of Federal Procure-
ment Policy Act, as added by section 6003 of this
Act;
(2) section 111 of the Federal Property and
Administrative Services Act of 1949 (40 U.S.C.
759), popularly referred to as the ‘‘Brooks Auto-
matic Data Processing Act’’;
(3) title IX of the Federal Property and Admin-
istrative Services Act of 1949 (40 U.S.C. 541 et
seq.), popularly referred to as the ‘‘Brooks Archi-
tect-Engineers Act’’;
163
(4) section 8(a) of the Small Business Act (15
U.S.C. 637(a)) or any other provision of that Act;
or
(5) the Act of June 25, 1938 (41 U.S.C. 46–
48c), that was revised and reenacted in the Act of
June 23, 1971 (85 Stat. 77), popularly referred to
as the ‘‘Javits-Wagner-O’Day Act’’.
SEC. 5009. COMPTROLLER GENERAL REVIEW OF FEDERAL
GOVERNMENT USE OF MARKET RESEARCH.
(a) REPORT REQUIRED.—Not later than 2 years
after the date of the enactment of this Act, the Comptrol-
ler General of the United States shall submit to the Con-
gress a report on the use of market research by the Fed-
eral Government in support of the procurement of com-
mercial items and nondevelopmental items.
(b) CONTENT OF REPORT.—The report shall include
the following:
(1) A review of existing Federal Government
market research efforts to gather data concerning
commercial and other nondevelopmental items.
(2) A review of the feasibility of creating a Gov-
ernment-wide data base for storing, retrieving, and
analyzing market data, including use of existing
Federal Government resources.
164
(3) Any recommendations for changes in law or
regulations that the Comptroller General considers
appropriate.
TITLE VI—MISCELLANEOUS
PROVISIONS
SEC. 6001. TEST PROGRAM.
(a) IN GENERAL.—The Administrator for Federal
Procurement Policy (in this section referred to as the ‘‘Ad-
ministrator’’) may conduct a program of tests of alter-
native and innovative procurement procedures. To the ex-
tent consistent with this section, such program shall be
conducted consistent with section 15 of the Office of Fed-
eral Procurement Policy Act (41 U.S.C. 413). No more
than 6 such tests shall be conducted under this authority.
(b) DESIGNATION
OF AGENCIES.—Each test con-
ducted pursuant to subsection (a) shall be limited to not
more than 2 specific contracting activities in an agency
designated by the Administrator. Each agency so des-
ignated shall select the contracting activities participating
in the test with the approval of the Administrator and
shall designate a procurement testing official who shall be
responsible for the conduct and evaluation of tests within
that agency.
(c) TEST REQUIREMENTS.—Tests conducted under
subsection (a)—
165
(1) shall be developed and structured by the
Administrator or by the agency senior procurement
executives designated pursuant to section 16(3) of
the Office of Federal Procurement Policy Act in
close coordination with the Administrator;
(2) shall be for a period of not greater than 4
years;
(3) shall be limited to specific programs of
agencies or specific acquisitions;
(4) may not include any test with a total esti-
mated life-cycle cost to the Federal Government
greater than $100,000,000;
(5) shall include—
(A) a test by the National Aeronautics and
Space Administration of simplified procurement
procedures for acquisitions with an estimated
annual total obligation of funds of $500,000 or
less;
(B) a test by the General Services Admin-
istration of expedited methods for procuring
automatic data processing equipment commod-
ities; and
(C) a test by at least one agency of
streamlined procedures for competition among
interested sources participating in the tailoring
166
of a solicitation for the purchase of commercial
products; and
(6) shall not include any procurement the cost
of which is expected to exceed $5,000,000 (including
options).
(d) LIMITATION ON TOTAL VALUE OF CONTRACTS
UNDER PROGRAM.—
(1) LIMITATION.—The Administrator shall en-
sure that the total amount obligated under contracts
awarded pursuant to the program under this section
does not exceed $600,000,000.
(2) MONITORING.—The Administrator shall
monitor the value of contracts awarded pursuant to
the program under this section.
(3) PROHIBITION ON AWARDS IN EXCESS OF
LIMIT.—No contract may be awarded under the pro-
gram under this section if the award of the contract
would 
result 
in 
obligation 
of 
more 
than
$600,000,000 under contracts under this section.
(e) PROCEDURES AUTHORIZED.—Tests conducted
under this section may include tests of any of the following
procedures:
(1) Publication of agency needs prior to draft-
ing of a solicitation.
167
(2) Screening of sources and competition
among capable vendors.
(3) Issuance of draft solicitations for comment.
(4) Streamlined solicitations, with a minimized
number of evaluation factors and information re-
quired from vendors, abbreviated periods for submis-
sion of offers, and page limitations on offers.
(5) Limitation of source selection factors to—
(A) cost to the Federal Government;
(B) past experience; and
(C) quality of the contents of the offer.
(6) Evaluation of proposals by small teams of
highly qualified people, limited to 30 days.
(7) Competition among sources of preevaluated
products.
(8) Alternative notice and publication require-
ments.
(9) A process in which—
(A) the competitive process is initiated by
a notice in the Commerce Business Daily syn-
opsizing the needs of the executive agency con-
ducting the test, in functional and performance
terms, with other specifications provided for
guidance only;
168
(B) the notice invites interested sources to
submit information or samples showing their
product’s suitability for those needs (with price
quotations) or, if appropriate, showing the
sources’ technical capability, past performance,
product supportability, or other qualifications
(with appropriate consideration to rates and
other cost-related factors);
(C) contracting officials develop a request
for proposals (including appropriate specifica-
tions and evaluation criteria) after reviewing
the submittals made by interested sources and,
if the officials determine necessary, after con-
sultation with those sources; and
(D) the contract is awarded after a
streamlined competition limited to all sources
that timely provided product information in re-
sponse to the notice or, if appropriate, to those
sources determined most capable based on those
qualification-based factors included in an invita-
tion to submit information pursuant to sub-
paragraph (B).
(f) TEST PLAN.—Not later than 60 days before im-
plementing any test program under this section, the Ad-
ministrator shall—
169
(1) provide a detailed test plan, including lists
of any regulations that are to be waived, and any
written determination under subsection (g)(1)(B) to
the Committee on Government Operations of the
House of Representatives and the Committee on
Governmental Affairs of the Senate;
(2) provide a copy of the plan to the appro-
priate authorizing committees of the House of Rep-
resentatives and the Senate; and
(3) publish the plan in the Federal Register
and provide an opportunity for public comment.
(g) WAIVER OF PROCUREMENT REGULATIONS.—
(1) IN GENERAL.—For purposes of a test con-
ducted under subsection (a), the Administrator may
waive—
(A) any provision of the Federal Acquisi-
tion Regulation that is not required by statute;
and
(B) any provision of the Federal Acquisi-
tion Regulation that is required by a provision
of law described in paragraph (2), the waiver of
which the Administrator determines in writing
to be necessary to conduct any test of any of
the 9 procedures described in subsection (e).
170
(2) PROVISIONS OF LAW DESCRIBED.—The pro-
visions of law referred to in paragraph (1) are the
following:
(A) Section 3709 of the Revised Statutes
(41 U.S.C. 5).
(B) Section 3710 of the Revised Statutes
(41 U.S.C. 8).
(C) Section 3735 of the Revised Statutes
(41 U.S.C. 13).
(D) Section 310 of the Federal Property
and Administrative Services Act of 1949 (41
U.S.C. 260).
(E) Section 303 of the Federal Property
and Administrative Services Act of 1949 (41
U.S.C. 253).
(F) Section 303A of the Federal Property
and Administrative Services Act of 1949 (41
U.S.C. 253a).
(G) Section 303B of the Federal Property
and Administrative Services Act of 1949 (41
U.S.C. 253b).
(H) Section 303C of the Federal Property
and Administrative Services Act of 1949 (41
U.S.C. 253c).
171
(I) Section 4(6) of the Office of Federal
Procurement Policy Act (41 U.S.C. 403(6)).
(J) Section 18 of the Office of Federal
Procurement Policy Act (41 U.S.C. 416).
(3) PROPOSAL
FOR
ADDITIONAL
WAIVER.—If
the Administrator determines that the conduct of a
test requires the waiver of a law not listed in para-
graph (2) or requires approval of an estimated dollar
amount not permitted under subsection (c)(4), the
Administrator may propose legislation to authorize
the waiver or grant the approval. Before proposing
such legislation, the Administrator may provide and
publish a test plan as described in subsection (f). If
Congress does not authorize the waiver or grant the
approval within 120 days after the date of receipt of
the proposal, the proposal shall be deemed to be
withdrawn. A proposal not approved within such 120
days may be resubmitted to Congress under this
paragraph at any time.
(h) REPORTS AND REVIEWS.—
(1) ADMINISTRATOR.—The Administrator shall
report to the Congress on the results of each test
conducted under subsection (a).
(2) COMPTROLLER GENERAL.—The Comptrol-
ler General of the United States shall review each
172
test conducted under subsection (a) and report to
the Congress on each test and shall report annually
to the Congress on the conduct of and results of all
tests conducted under subsection (a).
(i) EXPIRATION OF AUTHORITY.—The authority to
conduct tests under this section and to award contracts
under such tests shall expire on October 1, 1998. Con-
tracts entered prior to October 1, 1998, pursuant to a test
shall remain in effect, notwithstanding the expiration of
the authority to conduct the test under this section.
(j) PILOT PROGRAMS.—(1) The Administrator may
delegate to the Secretary of Defense authority to conduct
7 pilot programs of alternative and innovative procure-
ment procedures, including the waiver authority described
in paragraph (2).
(2) The authority delegated under paragraph (1) may
include authority for the Secretary of Defense—
(A) to apply any amendment or repeal of a pro-
vision of law made in the Federal Acquisition Re-
form Act of 1994 to the pilot programs before the
effective date of such amendment or repeal; and
(B) to apply to a procurement of noncommer-
cial items under such programs—
(i) any authority provided in such Act (or
in an amendment made by a provision of such
173
Act) to waive a provision of law in the case of
commercial items, and
(ii) any exception applicable under such
Act (or an amendment made by a provision of
such Act) in the case of commercial items,
before the effective date of such provision (or amendment)
to the extent that the Secretary determines necessary to
test the application of such waiver or exception to procure-
ments of noncommercial items.
(3)(A) Paragraph (2) applies with respect to—
(i) a contract that is awarded or modified dur-
ing the period described in subparagraph (B); and
(ii) a contract that is awarded before the begin-
ning of such period and is to be performed (or may
be performed), in whole or in part, during such pe-
riod.
(B) The period referred to in subparagraph (A) is
the period that begins 45 days after the date of the enact-
ment of the Federal Acquisition Reform Act of 1994 and
ends on September 30, 1998.
SEC. 6002. STUDY OF PARTICIPATION BY CERTAIN SMALL
BUSINESSES IN FEDERAL PROCUREMENT.
(a) STUDY.—The Administrator for Federal Procure-
ment Policy shall conduct a study of—
174
(1) the degree of participation by small busi-
nesses owned and controlled by socially and economi-
cally disadvantaged individuals in procurements con-
ducted by executive agencies, other than agencies in
the Department of Defense; and
(2) the extent of compliance by those executive
agencies with the goals for participation by such
businesses required by Office of Federal Procure-
ment Policy policy letter 91–1, relating to Govern-
ment-wide small business and small disadvantaged
business goals for procurement contracts.
(b) REPORT.—Not later than 6 months after the date
of the enactment of this Act, the Administrator for Fed-
eral Procurement Policy shall submit a report on the study
required under subsection (a) to the Committee on Gov-
ernment Operations and the Committee on Small Business
of the House of Representatives, and to the Committee
on Governmental Affairs and the Committee on Small
Business of the Senate. The report shall include rec-
ommendations to facilitate the provision of authority to
executive agencies, other than agencies in the Department
of Defense, to conduct procurement set asides for small
businesses owned and controlled by socially and economi-
cally disadvantaged individuals, and on improved outreach
175
programs to increase the participation by such businesses
in procurements conducted by those executive agencies.
SEC. 6003. FURTHERANCE OF GOVERNMENT-WIDE CON-
TRACT GOAL FOR SMALL DISADVANTAGED
BUSINESSES AND CERTAIN INSTITUTIONS OF
HIGHER EDUCATION.
The Office of Federal Procurement Policy Act (41
U.S.C. 41 et seq.), as amended by section 5005, is further
amended by adding at the end the following new section:
‘‘SEC. 46. FURTHERANCE OF GOVERNMENT-WIDE CON-
TRACT GOAL FOR SMALL DISADVANTAGED
BUSINESSES AND CERTAIN INSTITUTIONS OF
HIGHER EDUCATION.
‘‘(a) GOAL.—(1) A goal of 5 percent of the amount
described in subsection (b) shall be the objective of an ex-
ecutive agency in each of fiscal years 1994 through 2000
for the total combined amount obligated for contracts and
subcontracts entered into with—
‘‘(A) small business concerns, including mass
media and advertising firms, owned and controlled
by socially and economically disadvantaged individ-
uals (as such term is used in section 8(d) of the
Small Business Act (15 U.S.C. 637(d)) and regula-
tions issued under that section), the majority of the
earnings of which directly accrue to such individuals;
176
‘‘(B) historically Black colleges and universities,
including any nonprofit research institution that was
an integral part of such a college or university be-
fore November 14, 1986; and
‘‘(C) minority institutions (as defined in section
1046(3) of the Higher Education Act of 1965 (20
U.S.C. 1135d–5(3)), which, for the purposes of this
section, shall include Hispanic-serving institutions
(as defined in section 316(b)(1) of such Act (20
U.S.C. 1059c(b)(1)).
‘‘(2) The head of the agency shall establish a specific
goal within the overall 5 percent goal for the award of
prime contracts and subcontracts to historically Black col-
leges and universities and minority institutions in order
to increase the participation of such colleges and univer-
sities in the program provided for by this section.
‘‘(3)(i) The Federal Acquisition Regulation (issued
under section 25(c)) shall provide procedures or guidelines
for contracting officers to set goals which executive agency
prime contractors that are required to submit subcontract-
ing plans under section 8(d)(4)(B) of the Small Business
Act (15 U.S.C. 637(d)(4)(B)) in furtherance of the agen-
cy’s program to meet the 5 percent goal specified in para-
graph (1) should meet in awarding subcontracts, including
177
subcontracts to minority-owned media, to entities de-
scribed in that paragraph.
‘‘(ii) The regulations required by clause (i) shall pro-
vide that when a contract for a major system is to be per-
formed pursuant to a teaming arrangement between two
or more contractors, the contracting officer shall set each
team member’s goal by excluding the price of the work
to be performed by the other team members from the cal-
culation of total planned subcontract awards.
‘‘(b) AMOUNT.—The requirements of subsection (a)
for any fiscal year apply to the total value of all prime
contract and subcontract awards entered into by the exec-
utive agency for such fiscal year.
‘‘(c) TYPES OF ASSISTANCE.—(1) To attain the goal
specified in subsection (a)(1), the head of the agency shall
provide technical assistance to the entities referred to in
that subsection and, in the case of historically Black col-
leges and universities and minority institutions, shall also
provide infrastructure assistance.
‘‘(2) Technical assistance provided under this section
shall include information about the program, advice about
the agency’s procurement procedures, instruction in prep-
aration of proposals, and other such assistance as the
agency head considers appropriate. If the resources of the
executive agency are inadequate to provide such assist-
178
ance, the agency head may enter into contracts with mi-
nority private sector entities with experience and expertise
in the design, development, and delivery of technical as-
sistance services to eligible individuals, business firms and
institutions, acquisition agencies, and prime contractors.
Agency contracts with such entities shall be awarded an-
nually, based upon, among other things, the number of
minority small business concerns, historically Black col-
leges and universities, and minority institutions that each
such entity brings into the program.
‘‘(3) The agency head shall, to the maximum extent
practical, carry out programs under this section at col-
leges, universities, and institutions that agree to bear a
substantial portion of the cost associated with the pro-
grams.
‘‘(d) COMPETITIVE
PROCEDURES
AND
ADVANCE
PAYMENTS.—To attain the goal of subsection (a):
‘‘(1)(A) The head of the agency shall—
‘‘(i) ensure that substantial progress is
made in increasing awards of agency contracts
to entities described in subsection (a)(1);
‘‘(ii) exercise his utmost authority, re-
sourcefulness, and diligence; and
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10 percent in payment per contract to contractors or
subcontractors described in subsection (a). The
agency head shall adjust the percentage specified in
the preceding sentence for any industry category if
available 
information 
clearly 
indicates 
that
nondisadvantaged small business concerns in such
industry category are generally being denied a rea-
sonable opportunity to compete for contracts because
of the use of that percentage in the application of
this paragraph.
‘‘(4) To the extent practicable, the agency head
shall maximize the number of minority small busi-
ness concerns, historically Black colleges and univer-
sities, and minority institutions participating in the
program.
‘‘(5) The Federal Acquisition Regulation shall
provide for the following:
‘‘(A) Procedures or guidance for contract-
ing officers to provide incentives for prime con-
tractors referred to in subsection (a)(3) to in-
crease subcontractor awards to entities de-
scribed in subsection (a)(1).
‘‘(B) A requirement that contracting offi-
cers emphasize the award of contracts to enti-
ties described in subsection (a)(1) in all indus-
181
try categories, including those categories in
which such entities have not traditionally domi-
nated.
‘‘(C) Guidance to executive agency person-
nel on the relationship among the following pro-
grams:
‘‘(i) The program implementing this
section.
‘‘(ii) The program established under
section 8(a) of the Small Business Act (15
U.S.C. 637(a)).
‘‘(iii) The small business set-aside
program established under section 15(a) of
the Small Business Act (15 U.S.C.
644(a)).
‘‘(D) With respect to an agency procure-
ment which is reasonably likely to be set aside
for entities described in subsection (a)(1), a re-
quirement that (to the maximum extent prac-
ticable) the procurement be designated as such
a set-aside before the solicitation for the pro-
curement is issued.
‘‘(E) Policies and procedures which, to the
maximum extent practicable, will ensure that
current levels in the number or dollar value of
182
contracts awarded under the program estab-
lished under section 8(a) of the Small Business
Act (15 U.S.C. 637(a)) and under the small
business set-aside program established under
section 15(a) of the Small Business Act (15
U.S.C. 644(a)) are maintained and that every
effort is made to provide new opportunities for
contract awards to eligible entities, in order to
meet the goal of subsection (a).
‘‘(F) Implementation of this section in a
manner which will not alter the procurement
process under the program established under
section 8(a) of the Small Business Act (15
U.S.C. 637(a)).
‘‘(G) A requirement that one factor used in
evaluating the performance of a contracting of-
ficer be the ability of the officer to increase con-
tract awards to entities described in subsection
(a)(1).
‘‘(H) Increased technical assistance to en-
tities described in subsection (a)(1).
‘‘(e) PENALTIES AND REGULATIONS RELATING TO
STATUS.—(1) Whoever for the purpose of securing a con-
tract or subcontract under subsection (a) misrepresents
the status of any concern or person as a small business
183
concern owned and controlled by a minority (as described
in subsection (a)), shall be punished by a fine of not less
than $10,000, or by imprisonment for not more than one
year, or both.
‘‘(2) The Federal Acquisition Regulation shall pro-
hibit awarding a contract under this section to an entity
described in subsection (a)(1) unless the entity agrees to
comply with the requirements of section 15(o)(1) of the
Small Business Act (15 U.S.C. 644(o)(1)).
‘‘(f) DETERMINATION
BY AGENCY HEAD.—Under
procedures prescribed in the Federal Acquisition Regula-
tion, a person may request the agency head to determine
whether the use of small disadvantaged business set asides
by a contracting activity of the agency has caused a par-
ticular industry category to bear a disproportionate share
of the contracts awarded to attain the goal established for
that contracting activity for the purposes of this section.
Upon making a determination that a particular industry
category is bearing a disproportionate share, the agency
head shall take appropriate actions to limit the contracting
activity’s use of set asides in awarding contracts in that
particular industry category.
‘‘(g) COMPLIANCE WITH SUBCONTRACTING PLAN
REQUIREMENTS.—(1) The Federal Acquisition Regulation
shall contain regulations to ensure that potential contrac-
184
tors submitting sealed bids or competitive proposals to the
executive agency for procurement contracts to be awarded
under the program provided for by this section are comply-
ing with applicable subcontracting plan requirements of
section 8(d) of the Small Business Act (15 U.S.C. 637(d)).
‘‘(2) The regulations required by paragraph (1) shall
ensure that, with respect to a sealed bid or competitive
proposal for which the bidder or offeror is required to ne-
gotiate or submit a subcontracting plan under section 8(d)
of the Small Business Act (15 U.S.C. 637(d)), the sub-
contracting plan shall be a factor in evaluating the bid
or proposal.
‘‘(h) ANNUAL REPORT.—(1) Not later than Decem-
ber 15 of each year, the Administrator shall submit to
Congress a report on the progress of executive agencies
toward attaining the goal of subsection (a) during the pre-
ceding fiscal year.
‘‘(2) The report required under paragraph (1) shall
include the following:
‘‘(A) A full explanation of any progress toward
attaining the goal of subsection (a).
‘‘(B) A plan to achieve the goal, if necessary.
‘‘(3) The report required under paragraph (1) shall
also include the following:
185
‘‘(A) The aggregate differential between the fair
market price of all contracts awarded pursuant to
subsection (d)(3) and the estimated fair market
price of all such contracts had such contracts been
entered into using full and open competitive proce-
dures.
‘‘(B) An analysis of the impact that subsection
(a) shall have on the ability of small business con-
cerns not owned and controlled by socially and eco-
nomically disadvantaged individuals to compete for
contracts with the executive agency.
‘‘(C) A description of the percentage of con-
tracts (actions), the total dollar amount (size of ac-
tion), and the number of different entities relative to
the attainment of the goal of subsection (a), sepa-
rately for Black Americans, Native Americans, His-
panic Americans, Asian Pacific Americans, and
other minorities.
‘‘(D) A detailed description of the infrastruc-
ture assistance provided under subsection (c) during
the preceding fiscal year and of the plans for provid-
ing such assistance during the fiscal year in which
the report is submitted.
‘‘(i) RELATIONSHIP TO OTHER GOALS.—This section
shall not be construed as amending, modifying, or super-
186
seding any other provision of law establishing a goal or
requirement for an agency to obligate 5 percent or more
of the total value of all prime contract and subcontract
awards entered into by the agency for a fiscal year with
any entity described in subsection (a)(1).
‘‘(j) EFFECTIVE DATE.—This section applies to each
of fiscal years 1994 through 2000.’’.
SEC. 6004. EDUCATION AND TRAINING.
Section 6(d)(5) of the Office of Federal Procurement
Policy Act (41 U.S.C. 405(d)(4)) is amended—
(1) by striking out ‘‘and’’ at the end of sub-
paragraph (A);
(2) by striking out the period at the end of sub-
paragraph (B) and inserting in lieu thereof ‘‘; and’’;
and
(3) by adding at the end the following new sub-
paragraph:
‘‘(C) establish policies and procedures for
the establishment and implementation of edu-
cation and training programs authorized by this
Act, including the establishment and implemen-
tation of a sensitivity training course, in con-
junction with the General Services Administra-
tion, for critical procurement personnel de-
signed to increase the participation of small
187
business concerns owned and controlled by so-
cially and economically disadvantaged individ-
uals, women, and other minorities in procure-
ment activities conducted by an executive agen-
cy.’’.
SEC. 6005. SENSE OF CONGRESS ON NEGOTIATED RULE-
MAKING.
(a) FINDINGS.—The Congress finds the following:
(1) The use of negotiated rulemaking or similar
policy discussion group techniques is an appropriate
tool for—
(A) fostering effective implementation of,
and compliance with, laws and regulations;
(B) avoiding litigation; and
(C) achieving more productive and equi-
table relationships between the Federal Govern-
ment and the regulated segments of the private
sector.
(2) The use of negotiated rulemaking or similar
techniques in Federal procurement regulations could
be appropriate given the extreme complexity and in-
tricate interactions between buyer and seller in Fed-
eral procurements.
(b) SENSE OF CONGRESS.—It is the sense of Con-
gress that, in prescribing acquisition regulations, the Fed-
188
eral Acquisition Regulatory Council should consider using
negotiated rulemaking procedures in accordance with sec-
tions 561 through 570 of title 5, United States Code, or
similar techniques intended to achieve the benefits de-
scribed in subsection (a)(1).
SEC. 6006. VENDOR AND EMPLOYEE EXCELLENCE AWARDS.
Section 6(d) of the Office of Federal Procurement
Policy Act (41 U.S.C. 405(d)), as amended by section
3012(b), is further amended—
(1) by striking out the period at the end of
paragraph 
(10) 
(as 
redesignated 
by 
section
3012(b)(2)) and inserting in lieu thereof a semi-
colon; and
(2) by adding at the end the following new
paragraphs:
‘‘(11) providing for a Government-wide award
to recognize and promote vendor excellence; and
‘‘(12) providing for a Government-wide award
to recognize and promote excellence in officers and
employees of the Federal Government serving in pro-
curement-related positions.’’.
SEC. 6007. TECHNICAL AND CLERICAL AMENDMENTS.
(a) TABLE OF CONTENTS AMENDMENT.—Section 1
of the Office of Federal Procurement Policy Act (41
U.S.C. 401 note) is amended to read as follows:
189
‘‘SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
‘‘(a) SHORT TITLE.—This Act may be cited as the
‘Office of Federal Procurement Policy Act’.
‘‘(b) TABLE OF CONTENTS.—The table of contents
for this Act is as follows:
‘‘Sec. 1.
Short title; table of contents.
‘‘Sec. 2.
Declaration of policy.
‘‘Sec. 3.
Findings and purpose.
‘‘Sec. 4.
Definitions.
‘‘Sec. 4A.
Simplified acquisition threshold.
‘‘Sec. 4B.
Simplified acquisition procedures.
‘‘Sec. 4C.
Procedures applicable to purchases below micro-purchase threshold.
‘‘Sec. 5.
Office of Federal Procurement Policy.
‘‘Sec. 6.
Authority and functions of the Administrator.
‘‘Sec. 7.
Administrative powers.
‘‘Sec. 8.
Responsiveness to Congress.
‘‘Sec. 9.
Effect on existing laws.
‘‘Sec. 10.
Effect on existing regulations.
‘‘Sec. 11.
Authorization of appropriations.
‘‘Sec. 12.
Delegation.
‘‘Sec. 14.
Access to information.
‘‘Sec. 15.
Tests of innovative procurement methods and procedures.
‘‘Sec. 16.
Executive agency responsibilities.
‘‘Sec. 18.
Procurement notice.
‘‘Sec. 19.
Record requirements.
‘‘Sec. 20.
Advocates for competition.
‘‘Sec. 21.
Rights in technical data.
‘‘Sec. 22.
Publication of proposed regulations.
‘‘Sec. 23.
Contracting functions performed by Federal personnel.
‘‘Sec. 24.
Travel expenses of Government contractors.
‘‘Sec. 25.
Federal Acquisition Regulatory Council.
‘‘Sec. 26.
Cost Accounting Standards Board.
‘‘Sec. 27.
Procurement integrity.
‘‘Sec. 29.
Competition requirements.
‘‘Sec. 30.
Planning and solicitation requirements.
‘‘Sec. 31.
Evaluation and award.
‘‘Sec. 32.
Cost or pricing data: truth in negotiations.
‘‘Sec. 33.
Delegation of procurement functions.
‘‘Sec. 34.
Determinations and decisions.
‘‘Sec. 35.
Research, development, and production costs.
‘‘Sec. 36.
Contract financing.
‘‘Sec. 37.
Allowable costs.
‘‘Sec. 38.
Examination of records of contractor.
‘‘Sec. 39.
Federal acquisition computer network (FACNET).
‘‘Sec. 39A.
Implementation of FACNET systems.
‘‘Sec. 40.
Contracts: small business reservation.
‘‘Sec. 41.
Restriction on use of noncompetitive procedures for procurement
from a specified source.
‘‘Sec. 42.
Preference for acquisition of commercial items.
190
‘‘Sec. 43.
Regulations on acquisition of commercial items.
‘‘Sec. 44.
Principle of construction with future laws.
‘‘Sec. 45.
Authority to waive certain procurement laws for contracts for com-
mercial items.
‘‘Sec. 46.
Furtherance of Government-wide contract goal for small disadvan-
taged businesses and certain institutions of higher education.’’.
(b) AMENDMENTS FOR STYLISTIC CONSISTENCY.—
(1) OFFICE OF FEDERAL PROCUREMENT POL-
ICY ACT.—The Office of Federal Procurement Policy
Act (41 U.S.C. 401 et seq.) is amended so that the
section designation and section heading of each sec-
tion of such Act is in the same form and typeface
as the section designation and heading of this sec-
tion.
(2) FEDERAL PROPERTY AND ADMINISTRATIVE
SERVICES ACT OF 1949.—The Federal Property and
Administrative Services Act of 1949 (41 U.S.C. 471
et seq.) is amended so that the section designation
and section heading of each section of such Act is
in the same form and typeface as the section des-
ignation and heading of this section.
TITLE VII—EFFECTIVE DATES
AND REGULATIONS
SEC. 7001. EFFECTIVE DATES.
(a) IN GENERAL.—Except as provided in subsection
(b), this Act and the amendments made by this Act shall
apply with respect to any contract for which a solicitation
for bid or proposal is issued after—
191
(1) 30 days have expired after the issuance in
final form of revisions to the Federal Acquisition
Regulation pursuant to section 7002; or
(2) 180 days have expired after the date of the
enactment of this Act;
whichever is earlier.
(b) SPECIFIC EFFECTIVE DATE.—Subtitle C of title
I of this Act, and the amendments made by such subtitle
(relating to procurement protests), shall apply with re-
spect to any protest filed after the expiration of the 90-
day period beginning on the date of the enactment of this
Act.
SEC. 7002. REGULATIONS.
Not later than 150 days after the date of the enact-
ment of this Act, the Federal Acquisition Regulation (re-
ferred to in section 25(c) of the Office of Federal Procure-
ment Policy Act (41 U.S.C. 421(c))) shall be revised, in
final form, to implement this Act and the amendments
made by this Act.
SEC. 7003. EVALUATION BY THE COMPTROLLER GENERAL.
(a) EVALUATION RELATING TO ISSUANCE OF REGU-
LATIONS.—Not later than December 1, 1995, the Comp-
troller General shall submit to the committees referred to
in subsection (c) a report evaluating compliance with the
192
requirements in section 7002, relating to the issuance of
implementing regulations.
(b) EVALUATION OF IMPLEMENTATION OF REGULA-
TIONS.—Not later than December 1, 1996, the Comptrol-
ler General shall submit to the committees referred to in
subsection (c) a report evaluating the effectiveness of the
regulations implementing this Act in streamlining the ac-
quisition system and fulfilling the other purposes of this
Act.
(c) COMMITTEES DESIGNATED TO RECEIVE THE RE-
PORTS.—The Comptroller General shall submit the re-
ports required by this section to the Committees on Armed
Services and on Governmental Affairs of the Senate and
the Committees on Small Business on Government Oper-
ations of the House of Representatives.
SEC. 7004. DATA COLLECTION THROUGH THE FEDERAL
PROCUREMENT DATA SYSTEM.
(a) DATA COLLECTION REQUIRED.—The Federal
Procurement Data System described in section 6(d)(4)(A)
of the Office of Federal Procurement Policy Act (41
U.S.C. 405(d)(4)(A)) shall be modified to collect from con-
tracts in excess of the simplified acquisition threshold data
pertaining to the following matters:
(1) Contract awards made pursuant to competi-
tions conducted pursuant to section 46 of the Office
193
of Federal Procurement Policy Act, as added by sec-
tion 6003.
(2) Awards to business concerns owned and
controlled by women.
(3) Number of offers received in response to a
solicitation.
(4) Task order contracts.
(5) Contracts for the acquisition of commercial
items.
(b) DEFINITION.—In this section, the term ‘‘sim-
plified acquisition threshold’’ has the meaning given such
term in section 4A of the Office of Federal Procurement
Policy Act (41 U.S.C. 403).
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