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‘‘(iv) Amounts collected as premiums under this sub-
paragraph shall be credited to the appropriation available
for the Defense Health Program Account under section 1100
of this title, shall be merged with sums in such Account
that are available for the fiscal year in which collected, and
shall be available under subparagraph (B) of such section
for such fiscal year.
‘‘(G) A person who receives health care pursuant to
an enrollment in a TRICARE program option under this
paragraph, including a member who receives such health
care, shall be subject to the same deductibles, copayments,
and other nonpremium charges for health care as apply
under this chapter for health care provided under the same
TRICARE program option to dependents described in sub-
paragraph (A), (D), or (I) of section 1072(2) of this title.
‘‘(H) A member enrolled in the TRICARE program
under this paragraph may terminate the enrollment only
during an open enrollment period provided under subpara-
graph (D), except as provided in subparagraph (I). An en-
rollment of a member for self alone or for self and family
under this paragraph shall terminate on the first day of
the first month beginning after the date on which the mem-
ber ceases to be eligible under subparagraph (A). The enroll-
ment of a member under this paragraph may be terminated
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on the basis of failure to pay the premium charged the
member under this paragraph.
‘‘(I) A member may not enroll in the TRICARE pro-
gram under this paragraph while entitled to transitional
health care under subsection (a) of section 1145 of this title
or while authorized to receive health care under subsection
(c) of such section. A member who enrolls in the TRICARE
program under this paragraph within 90 days after the
date of the termination of the member’s entitlement or eligi-
bility to receive health care under subsection (a) or (c) of
section 1145 of this title may terminate the enrollment at
any time within one year after the date of the enrollment.
‘‘(J) The Secretary of Defense, in consultation with the
other administering Secretaries, shall prescribe regulations
for the administration of this paragraph.
‘‘(4)(A) The Secretary concerned shall pay the applica-
ble premium to continue in force any qualified health bene-
fits plan coverage for an eligible reserve component member
for the benefits coverage continuation period if timely elect-
ed by the member in accordance with regulations prescribed
under subparagraph (J).
‘‘(B) A member of a reserve component is eligible for
payment of the applicable premium for continuation of
qualified health benefits plan coverage under subparagraph
(A) while serving on active duty pursuant to a call or order
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issued under a provision of law referred to in section
101(a)(13)(B) of this title during a war or national emer-
gency declared by the President or Congress.
‘‘(C) For the purposes of this paragraph, health bene-
fits plan coverage for a member called or ordered to active
duty is qualified health benefits plan coverage if—
‘‘(i) the coverage was in force on the date on
which the Secretary notified the member that issuance
of the call or order was pending or, if no such notifi-
cation was provided, the date of the call or order;
‘‘(ii) on such date, the coverage applied to the
member and dependents of the member described in
subparagraph (A), (D), or (I) of section 1072(2) of
this title; and
‘‘(iii) the coverage has not lapsed.
‘‘(D) The applicable premium payable under this
paragraph for continuation of health benefits plan coverage
in the case of a member is the amount of the premium pay-
able by the member for the coverage of the member and de-
pendents.
‘‘(E) The total amount that the Department of Defense
may pay for the applicable premium of a health benefits
plan for a member under this paragraph in a fiscal year
may not exceed the amount determined by multiplying—
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‘‘(i) the sum of one plus the number of the mem-
ber’s dependents covered by the health benefits plan,
by
‘‘(ii) the per capita cost of providing TRICARE
coverage and benefits for dependents under this chap-
ter for such fiscal year, as determined by the Sec-
retary of Defense.
‘‘(F) The benefits coverage continuation period under
this paragraph for qualified health benefits plan coverage
in the case of a member called or ordered to active duty
is the period that—
‘‘(i) begins on the date of the call or order; and
‘‘(ii) ends on the earlier of the date on which the
member’s eligibility for transitional health care under
section 1145(a) of this title terminates under para-
graph (3) of such section, or the date on which the
member elects to terminate the continued qualified
health benefits plan coverage of the dependents of the
member.
‘‘(G) Notwithstanding any other provision of law—
‘‘(i) any period of coverage under a COBRA con-
tinuation provision (as defined in section 9832(d)(1)
of the Internal Revenue Code of 1986) for a member
under this paragraph shall be deemed to be equal to
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the benefits coverage continuation period for such
member under this paragraph; and
‘‘(ii) with respect to the election of any period of
coverage under a COBRA continuation provision (as
so defined), rules similar to the rules under section
4980B(f)(5)(C) of such Code shall apply.
‘‘(H) A dependent of a member who is eligible for bene-
fits under qualified health benefits plan coverage paid on
behalf of a member by the Secretary concerned under this
paragraph is not eligible for benefits under the TRICARE
program during a period of the coverage for which so paid.
‘‘(I) A member who makes an election under subpara-
graph (A) may revoke the election. Upon such a revocation,
the member’s dependents shall become eligible for benefits
under the TRICARE program as provided for under this
chapter.
‘‘(J) The Secretary of Defense shall prescribe regula-
tions for carrying out this paragraph. The regulations shall
include such requirements for making an election of pay-
ment of applicable premiums as the Secretary considers ap-
propriate.
‘‘(5) For the purposes of this section, all members of
the Ready Reserve who are to be called or ordered to active
duty include all members of the Ready Reserve.
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‘‘(6) The Secretary concerned shall promptly notify all
members of the Ready Reserve that they are eligible for
screening and care under this section.
‘‘(7) A member provided medical or dental screening
or care under paragraph (1) may not be charged for the
screening or care.’’.
SEC. 702. TRICARE BENEFICIARY COUNSELING AND AS-
SISTANCE 
COORDINATORS 
FOR 
RESERVE
COMPONENT BENEFICIARIES.
Section 1095e(a)(1) of title 10, United States Code, is
amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (A);
(2) by redesignating subparagraph (B) as sub-
paragraph (C); and
(3) by inserting after subparagraph (A) the fol-
lowing new subparagraph (B):
‘‘(B) designate for each of the TRICARE
program regions at least one person (other than
a person designated under subparagraph (A)) to
serve full-time as a beneficiary counseling and
assistance coordinator solely for members of the
reserve components and their dependents who are
beneficiaries under the TRICARE program;
and’’.
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SEC. 703. EXTENSION OF AUTHORITY TO ENTER INTO PER-
SONAL SERVICES CONTRACTS FOR HEALTH
CARE SERVICES TO BE PERFORMED AT LOCA-
TIONS OUTSIDE MEDICAL TREATMENT FA-
CILITIES.
Section 1091(a)(2) of title 10, United States Code, is
amended by striking ‘‘December 31, 2003’’ and inserting
‘‘December 31, 2008’’.
SEC. 704. DEPARTMENT OF DEFENSE MEDICARE-ELIGIBLE
RETIREE HEALTH CARE FUND VALUATIONS
AND CONTRIBUTIONS.
(a) SEPARATE PERIODIC ACTUARIAL VALUATION FOR
SINGLE UNIFORMED SERVICE.—Section 1115(c) of title 10,
United States Code, is amended by adding at the end the
following new paragraph:
‘‘(6) The Secretary of Defense may determine a single
level dollar amount under subparagraph (A) or (B) of para-
graph (1) for each or any of the participating uniformed
services separately from the other participating uniformed
services if the Secretary determines that a more accurate
and appropriate actuarial valuation under such subpara-
graph would be achieved by doing so.’’.
(b) ASSOCIATED CALCULATIONS OF PAYMENTS INTO
THE FUND.—Section 1116 of such title is amended—
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(1) in subsection (a), by striking ‘‘the amount
that’’ in the matter preceding paragraph (1) and in-
serting ‘‘the amount that, subject to subsection (b),’’;
(2) by redesignating subsections (b) and (c) as
subsections (c) and (d), respectively; and
(3) by inserting after subsection (a) the following
new subsection (b):
‘‘(b) If an actuarial valuation referred to in paragraph
(1) or (2) of subsection (a) has been calculated in a single
level dollar amount for a participating uniformed service
separately from the other participating uniformed services
under section 1115(c)(6) of this title, the administering Sec-
retary for the department in which such uniformed service
is operating shall calculate the amount under such para-
graph separately for such uniformed service. If the admin-
istering Secretary is not the Secretary of Defense, the ad-
ministering Secretary shall notify the Secretary of Defense
of the amount so calculated. To determine a single amount
for the purpose of paragraph (1) or (2) of subsection (a),
as the case may be, the Secretary of Defense shall aggregate
the amount calculated under this subsection for a uniformed
service for the purpose of such paragraph with the amount
or amounts calculated (whether separately or otherwise) for
the other uniformed services for the purpose of such para-
graph.’’.
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(c) TECHNICAL CORRECTION.—Section 1115(c)(1)(B)
of such title is amended by striking ‘‘and other than mem-
bers’’ and inserting ‘‘(other than members’’
(d) CONFORMING AMENDMENT.—Subsections (a) and
(c)(5) of section 1115 of such title are amended by striking
‘‘section 1116(b) of this title’’ and inserting section ‘‘1116(c)
of this title’’.
SEC. 705. SURVEYS ON CONTINUED VIABILITY OF TRICARE
STANDARD.
(a) REQUIREMENT FOR SURVEYS.—(1) The Secretary
of Defense shall conduct surveys in the TRICARE Standard
market areas in the continental United States to determine
how many health care providers are accepting new patients
under TRICARE Standard in each such market area.
(2) The Secretary shall carry out the surveys in at
least 20 TRICARE market areas in the continental United
States each fiscal year after fiscal year 2003 until all such
market areas in the continental United States have been
surveyed. The Secretary shall complete six of the fiscal year
2004 surveys not later than March 31, 2004.
(3) In prioritizing the market areas for the sequence
in which market areas are to be surveyed under this sub-
section, the Secretary shall consult with representatives of
TRICARE beneficiaries and health care providers to iden-
tify locations where TRICARE Standard beneficiaries are
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experiencing significant levels of access-to-care problems
under TRICARE Standard and shall give a high priority
to surveying health care providers in such areas.
(b) SUPERVISION.—(1) The Secretary shall designate
a senior official of the Department of Defense to take the
actions necessary for achieving and maintaining participa-
tion of health care providers in TRICARE Standard in
each TRICARE market area in a number that is adequate
to ensure the viability of TRICARE Standard for
TRICARE beneficiaries in that market area.
(2) The official designated under paragraph (1) shall
have the following duties:
(A) To educate health care providers about
TRICARE Standard.
(B) To encourage health care providers to accept
patients under TRICARE Standard.
(C) To ensure that TRICARE beneficiaries have
the information necessary to locate TRICARE Stand-
ard providers readily.
(D) To recommend adjustments in TRICARE
Standard provider payment rates that the official
considers necessary to ensure adequate availability of
TRICARE Standard providers for TRICARE Stand-
ard beneficiaries.
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(c) GAO REVIEW.—(1) The Comptroller General shall,
on an ongoing basis, review—
(A) the processes, procedures, and analysis used
by the Department of Defense to determine the ade-
quacy of the number of health care providers accept-
ing TRICARE Standard beneficiaries as patients
under TRICARE Standard in each TRICARE mar-
ket area; and
(B) the actions taken by the Department of De-
fense to ensure ready access of TRICARE Standard
beneficiaries to health care under TRICARE Stand-
ard in each TRICARE market area.
(2)(A) The Comptroller General shall submit to the
Committees on Armed Services of the Senate and the House
of Representatives a semiannual report on the results of the
review under paragraph (1). The first semiannual report
shall be submitted not later than June 30, 2004.
(B) The semiannual report under subparagraph (A)
shall include the following:
(i) An analysis of the adequacy of the surveys
under subsection (a).
(ii) The adequacy of existing statutory authority
to address inadequate levels of participation by health
care providers in TRICARE Standard.
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(iii) Identification of policy-based obstacles to
achieving adequacy of availability of TRICARE
Standard health care in the TRICARE Standard
market areas.
(iv) An assessment of the adequacy of Depart-
ment of Defense education programs to inform health
care providers about TRICARE Standard.
(v) An assessment of the adequacy of Department
of Defense initiatives to encourage health care pro-
viders to accept patients under TRICARE Standard.
(vi) An assessment of the adequacy of informa-
tion to TRICARE Standard beneficiaries to facilitate
access by such beneficiaries to health care under
TRICARE Standard.
(vii) Any need for adjustment of health care pro-
vider payment rates to attract participation in
TRICARE Standard by appropriate numbers of
health care providers.
(d) 
DEFINITION.—In 
this 
section, 
the 
term
‘‘TRICARE Standard’’ means the option of the TRICARE
program that is also known as the Civilian Health and
Medical Program of the Uniformed Services, as defined in
section 1072(4) of title 10, United States Code.
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SEC. 706. ELIMINATION 
OF 
LIMITATION 
ON 
COVERED
BENEFICIARIES’ 
ELIGIBILITY 
TO 
RECEIVE
HEALTH CARE SERVICES FROM FORMER PUB-
LIC HEALTH SERVICE TREATMENT FACILI-
TIES.
Section 724(d) of the National Defense Authorization
Act for Fiscal Year 1997 (Public Law 104–201; 10 U.S.C.
1073 note) is amended by striking ‘‘who—’’ and all that
follows through ‘‘(2) are enrolled’’ and inserting ‘‘who are
enrolled’’.
SEC. 707. MODIFICATION OF STRUCTURE AND DUTIES OF
DEPARTMENT 
OF 
VETERANS 
AFFAIRS-DE-
PARTMENT OF DEFENSE HEALTH EXECUTIVE
COMMITTEE.
(a) IN GENERAL.—Subsection (c) of section 8111 of
title 38, United States Code, is amended to read as follows:
‘‘(c) DOD–VA JOINT EXECUTIVE COMMITTEE.—(1)
There is established an interagency committee to be known
as the Department of Veterans Affairs-Department of De-
fense Joint Executive Committee (hereinafter in this section
referred to as the ‘Committee’).
‘‘(2) The Committee shall be composed of—
‘‘(A) the Deputy Secretary of Veterans Affairs
and such other officers and employees of the Depart-
ment as the Secretary may designate; and
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‘‘(B) the Under Secretary of Defense for Per-
sonnel and Readiness and such other officers and em-
ployees of the Department of Defense as the Secretary
of Defense may designate.
‘‘(3)(A) The Deputy Secretary and the Under Sec-
retary shall determine the size and structure of the Com-
mittee, except that the Committee shall have subordinate
committees as follows:
‘‘(i) A Health Executive Committee.
‘‘(ii) A Benefits Executive Committee.
‘‘(iii) Such other subordinate committees as the
Deputy Secretary and the Under Secretary consider
appropriate.
‘‘(B) The Deputy Secretary and the Under Secretary
shall establish the administrative and procedural guidelines
for the operation of the Committee.
‘‘(C) The two Departments shall supply staff and re-
sources to the Committee in order to provide such adminis-
trative support and services for the Committee as are nec-
essary for the efficient operation of the Committee.
‘‘(4) The Committee shall recommend to the Secretaries
strategic direction for the joint coordination and sharing
of efforts between and within the two Departments under
this section, and shall oversee implementation of such co-
ordination and efforts.
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‘‘(5) In order to enable the Committee to make rec-
ommendations under paragraph (4) in its annual report
under paragraph (6), the Committee shall—
‘‘(A) review existing policies, procedures, and
practices relating to the coordination and sharing of
health care resources and other resources between the
two Departments;
‘‘(B) identify changes in policies, procedures,
and practices that, in the judgment of the Committee,
would promote mutually beneficial coordination, use,
or exchange of use of services and health care re-
sources and other resources of the two Departments in
order to achieve the goal of improving the quality, ef-
ficiency, and effectiveness of the delivery of benefits
and services to veterans, members of the Armed
Forces, military retirees, and their families through
an enhanced partnership between the two Depart-
ments;
‘‘(C) identify and assess further opportunities for
coordination and collaboration between the two De-
partments that, in the judgment of the Committee,
would not adversely affect the range of services, the
quality of care, or the established priorities for bene-
fits provided by either Department;
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‘‘(D) review the plans of both agencies for the ac-
quisition of additional health care resources and other
resources, especially new facilities and major equip-
ment and technology, in order to assess the potential
effect of such plans on further opportunities for the
coordination and sharing of such resources; and
‘‘(E) review the implementation of activities de-
signed to promote the coordination and sharing of
health care resources and other resources between the
two Departments.
‘‘(6) The Committee shall submit to the Secretaries,
and to Congress, each year a report containing such rec-
ommendations as the Committee considers appropriate, in-
cluding recommendations in light of activities under para-
graph (5).’’.
(b) CONFORMING AMENDMENT.—Subsection (e)(1) of
such section is amended by striking ‘‘subsection (c)(2)’’ and
inserting ‘‘subsection (c)(4)’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall take effect on October 1, 2003, as if included
in the amendments to section 8111 of title 38, United States
Code, made by section 721 of the Bob Stump National De-
fense Authorization Act for Fiscal Year 2003 (Public Law
107–314; 116 Stat. 2589), to which the amendments made
by this section relate.
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(d) INTEGRATED HEALING CARE PRACTICES.—(1)
The Secretary of Defense and the Secretary of Veterans Af-
fairs may, acting through the Department of Veterans Af-
fairs-Department of Defense Joint Executive Committee,
conduct a program to develop and evaluate integrated heal-
ing care practices for members of the Armed Forces and
veterans.
(2) Amounts authorized to be appropriated by section
301(21) for the Defense Health Program may be available
for the program under paragraph (1).
SEC. 708. ELIGIBILITY 
OF 
RESERVE 
OFFICERS 
FOR
HEALTH CARE PENDING ORDERS TO ACTIVE
DUTY FOLLOWING COMMISSIONING.
Section 1074(a) of title 10, United States Code, is
amended—
(1) by inserting ‘‘(1)’’ after ‘‘(a)’’;
(2) by striking ‘‘who is on active duty’’ and in-
serting ‘‘described in paragraph (2)’’; and
(3) by adding at the end the following new para-
graph:
‘‘(2) Members of the uniformed services referred to in
paragraph (1) are as follows:
‘‘(A) A member of a uniformed service on active
duty.
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‘‘(B) A member of a reserve component of a uni-
formed service who has been commissioned as an offi-
cer if—
‘‘(i) the member has requested orders to ac-
tive duty for the member’s initial period of ac-
tive duty following the commissioning of the
member as an officer;
‘‘(ii) the request for orders has been ap-
proved;
‘‘(iii) the orders are to be issued but have
not been issued; and
‘‘(iv) the member does not have health care
insurance and is not covered by any other health
benefits plan.’’.
SEC. 709. REIMBURSEMENT OF COVERED BENEFICIARIES
FOR CERTAIN TRAVEL EXPENSES RELATING
TO SPECIALIZED DENTAL CARE.
Section 1074i of title 10, United States Code, is
amended—
(1) by inserting ‘‘(a) IN GENERAL.—’’ before ‘‘In
any case’’; and
(2) by adding at the end the following new sub-
section:
‘‘(b) SPECIALTY CARE PROVIDERS.—For purposes of
subsection (a), the term ‘specialty care provider’ includes
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a dental specialist (including an oral surgeon, orthodontist,
prosthodontist, periodontist, endodontist, or pediatric den-
tist).’’.
TITLE VIII—ACQUISITION POL-
ICY, ACQUISITION MANAGE-
MENT, AND RELATED MAT-
TERS
Subtitle A—Acquisition Policy and
Management
SEC. 801. TEMPORARY EMERGENCY PROCUREMENT AU-
THORITY TO FACILITATE DEFENSE AGAINST
OR RECOVERY FROM TERRORISM OR NU-
CLEAR, BIOLOGICAL, CHEMICAL, OR RADIO-
LOGICAL ATTACK.
(a) EXTENSION OF AUTHORITY.—Section 836(a) of the
National Defense Authorization Act for Fiscal Year 2002
(Public Law 107–107; 115 Stat. 1192; 10 U.S.C. 2302 note)
is amended by striking ‘‘fiscal year 2002 and 2003’’ and
inserting ‘‘fiscal years 2002, 2003, 2004, and 2005’’.
(b) EXPANDED SCOPE.—Such section 836(a) is further
amended—
(1) in paragraph (1), by striking ‘‘the defense
against terrorism or biological or chemical attack’’
and inserting ‘‘defense against or recovery from ter-
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rorism or nuclear, biological, chemical, or radiological
attack’’; and
(2) in paragraph (2), by striking ‘‘the defense
against terrorism or biological attack’’ and inserting
‘‘defense against or recovery from terrorism or nu-
clear, biological, chemical, or radiological attack’’.
(c) CONFORMING AMENDMENT.—The heading for such
section is amended to read as follows:
‘‘SEC. 836. TEMPORARY EMERGENCY PROCUREMENT AU-
THORITY TO FACILITATE DEFENSE AGAINST
OR RECOVERY FROM TERRORISM OR NU-
CLEAR, BIOLOGICAL, CHEMICAL, OR RADIO-
LOGICAL ATTACK.’’
SEC. 802. SPECIAL TEMPORARY CONTRACT CLOSEOUT AU-
THORITY.
(a) AUTHORITY.—The Secretary of Defense may settle
any financial account for a contract entered into by the
Secretary or the Secretary of a military department before
October 1, 1996, that is administratively complete if the
financial account has an unreconciled balance, either posi-
tive or negative, that is less than $100,000.
(b) FINALITY OF DECISION.—A settlement under this
section shall be final and conclusive upon the accounting
officers of the United States.
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(c) REGULATIONS.—The Secretary of Defense shall
prescribe regulations for the administration of the authority
under this section.
(d) TERMINATION OF AUTHORITY.—A financial ac-
count may not be settled under this section after September
30, 2006.
SEC. 803. DEFENSE ACQUISITION PROGRAM MANAGEMENT
FOR USE OF RADIO FREQUENCY SPECTRUM.
(a) REVISION OF DEPARTMENT OF DEFENSE DIREC-
TIVE.—Not later than one year after the date of the enact-
ment of this Act, the Secretary of Defense shall revise and
reissue Department of Defense Directive 4650.1, relating to
management and use of the radio frequency spectrum, last
issued on June 24, 1987, to update the procedures applica-
ble to Department of Defense management and use of the
radio frequency spectrum.
(b) ACQUISITION
PROGRAM
REQUIREMENTS.—The
Secretary of Defense shall—
(1) require that each military department or De-
fense Agency carrying out a program for the acquisi-
tion of a system that is to use the radio frequency
spectrum consult with the official or board designated
under subsection (c) on the usage of the spectrum by
the system as early as practicable during the concept
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exploration and technology development phases of the
acquisition program;
(2) prohibit the program from proceeding into
system development and demonstration, or otherwise
obtaining production or procuring any unit of the
system, until—
(A) an evaluation of the proposed radio fre-
quency spectrum usage by the system is com-
pleted in accordance with requirements pre-
scribed by the Secretary; and
(B) the designated official or board reviews
and approves the proposed usage of the spectrum
by the system; and
(3) prescribe a procedure for waiving the prohi-
bition imposed under paragraph (2) in any case in
which it is determined necessary to do so in the na-
tional security interests of the United States.
(c) DESIGNATION OF OFFICIAL OR BOARD.—The Sec-
retary of Defense shall designate an appropriate official or
board of the Department of Defense to perform the functions
described for the official or board in subsection (b).
SEC. 804. NATIONAL SECURITY AGENCY MODERNIZATION
PROGRAM.
(a) RESPONSIBILITIES OF UNDER SECRETARY OF DE-
FENSE FOR ACQUISITION, TECHNOLOGY, AND LOGISTICS.—
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The Secretary of Defense, acting through the Under Sec-
retary of Defense for Acquisition, Technology, and Logistics,
shall—
(1) direct and manage the acquisitions under the
National Security Agency Modernization Program;
and
(2) designate the projects under such program as
major defense acquisition programs.
(b) PROJECTS COMPRISING PROGRAM.—The National
Security Agency Modernization Program includes the fol-
lowing projects of the National Security Agency:
(1) The Trailblazer project.
(2) The Groundbreaker project.
(3) Each cryptological mission management
project.
(4) Each other project that—
(A) meets either of the dollar threshold re-
quirements set forth in subsection (a)(2) of sec-
tion 2430 of title 10, United States Code (as ad-
justed under subsection (b) of such section); and
(B) is determined by the Under Secretary of
Defense for Acquisition, Technology, and Logis-
tics as being a modernization project of the Na-
tional Security Agency.
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(c) MILESTONE DECISION AUTHORITY.—(1) In the ad-
ministration of subsection (a), the Under Secretary of De-
fense for Acquisition, Technology, and Logistics shall exer-
cise the milestone decision authority for—
(A) each major defense acquisition program
under the National Security Agency Modernization
Program, as designated under subsection (a)(2); and
(B) the acquisition of each major system under
the National Security Agency Modernization Pro-
gram, as described in subsection (d).
(2) The Under Secretary may not delegate the mile-
stone decision authority to any other official before October
1, 2006.
(3) The Under Secretary may delegate the milestone
decision authority to the Director of the National Security
Agency at any time after the later of September 30, 2006,
or the date on which the following conditions are satisfied:
(A) The Under Secretary has determined that the
Director has implemented acquisition management
policies, procedures, and practices that are suffi-
ciently mature to ensure that National Security
Agency acquisitions are conducted in a manner con-
sistent with a sound, efficient acquisition enterprise.
(B) The Under Secretary has consulted with the
Under Secretary of Defense for Intelligence and the
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Deputy Director of Central Intelligence for Commu-
nity Management on the delegation.
(C) The Secretary of Defense has approved the
delegation.
(D) The Under Secretary has transmitted to the
Committees on Armed Services of the Senate and the
House of Representatives, the Select Committee on In-
telligence of the Senate, and the Permanent Select
Committee on Intelligence of the House of Representa-
tives a notification of the intention to delegate the au-
thority, together with a detailed discussion of the jus-
tification for the delegation of authority.
(d) MAJOR SYSTEM DEFINED.—In this section, the
term ‘‘major system’’ means a system that meets either of
the dollar threshold requirements set forth in paragraph (1)
or (2) of subsection (a) of section 2302d of title 10, United
States Code (as adjusted under subsection (c) of such sec-
tion).
SEC. 805. QUALITY CONTROL IN PROCUREMENT OF AVIA-
TION CRITICAL SAFETY ITEMS AND RELATED
SERVICES.
(a) QUALITY CONTROL POLICY.—The Secretary of De-
fense shall prescribe a quality control policy for the procure-
ment of aviation critical safety items and the procurement
of modifications, repair, and overhaul of such items.
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(b) CONTENT OF POLICY.—The policy shall include the
following requirements:
(1) That the head of the design control activity
for aviation critical safety items establish processes to
identify and manage aviation critical safety items
and modifications, repair, and overhaul of such items.
(2) That the head of the contracting activity for
an aviation critical safety item enter into a contract
for such item only with a source approved by the de-
sign control activity in accordance with section 2319
of title 10, United States Code.
(3) That the aviation critical safety items deliv-
ered, and the services performed with respect to avia-
tion critical safety items, meet all technical and qual-
ity requirements specified by the design control activ-
ity, except for any requirement determined unneces-
sary by the Secretary of Defense in writing.
(c) DEFINITIONS.—In this section, the terms ‘‘aviation
critical safety item’’ and ‘‘design control activity’’ have the
meanings given such terms in section 2319(g) of title 10,
United States Code, as amended by subsection (d).
(d) CONFORMING AMENDMENT TO TITLE 10.—Section
2319 of title 10, United States Code, is amended—
(1) in subsection (c)(3), by inserting after ‘‘the
contracting officer’’ the following: ‘‘(or, in the case of
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a contract for the procurement of an aviation critical
item, the head of the design control activity for such
item)’’; and
(2) by adding at the end the following new sub-
section:
‘‘(g) DEFINITIONS.—In this section:
‘‘(1) The term ‘aviation critical safety item’
means a part, an assembly, installation equipment,
launch equipment, recovery equipment, or support
equipment for an aircraft or aviation weapon system
if the part, assembly, or equipment contains a char-
acteristic any failure, malfunction, or absence of
which could cause a catastrophic or critical failure
resulting in the loss of or serious damage to the air-
craft or weapon system, an unacceptable risk of per-
sonal injury or loss of life, an uncommanded engine
shutdown that jeopardizes safety, or the failure of a
military mission.
‘‘(2) The term ‘design control activity’, with re-
spect to an aviation critical safety item, means the
systems command of a military department that is
specifically responsible for ensuring the airworthiness
of an aviation system or equipment in which the item
is to be used.’’.
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Subtitle B—Procurement of Services
SEC. 811. EXPANSION AND EXTENSION OF INCENTIVE FOR
USE OF PERFORMANCE-BASED CONTRACTS
IN PROCUREMENTS OF SERVICES.
(a) INCREASED MAXIMUM AMOUNT OF PROCUREMENT
ELIGIBLE FOR COMMERCIAL ITEMS TREATMENT.—Para-
graph (1)(A) of section 821(b) of the Floyd D. Spence Na-
tional Defense Authorization Act for Fiscal Year 2001 (as
enacted into law by Public Law 106–398; 114 Stat. 1654A–
218; 10 U.S.C. 2302 note) is amended by striking
‘‘$5,000,000’’ and inserting ‘$10,000,000’’.
(b) EXTENSION OF AUTHORITY.—Paragraph (4) of
such section 821(b) is amended by striking ‘‘more than 3
years after the date of the enactment of this Act’’ and insert-
ing ‘‘after October 30, 2006’’.
SEC. 812. PUBLIC-PRIVATE COMPETITIONS FOR THE PER-
FORMANCE OF DEPARTMENT OF DEFENSE
FUNCTIONS.
(a) PILOT PROGRAM FOR BEST VALUE SOURCE SE-
LECTION FOR THE PERFORMANCE OF INFORMATION TECH-
NOLOGY SERVICES.—
(1) AUTHORITY.—The Secretary of Defense may
carry out a pilot program for use of a best value cri-
terion in the selection of sources for performance of
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information technology services for the Department of
Defense.
(2) CONVERSION TO PRIVATE SECTOR PERFORM-
ANCE.—(A) Under the pilot program, an analysis of
the performance of an information technology services
function for the Department of Defense under section
2461(b)(3) of title 10, United States Code, shall in-
clude an examination of the performance of the func-
tion by Department of Defense civilian employees and
by one or more private contractors to demonstrate
whether change to performance by the private sector
will result in the best value to the Government over
the life of the contract, including in the examination
the following:
(i) The cost to the Government, estimated by
the Secretary of Defense (based on offers re-
ceived), for performance of the function by the
private sector.
(ii) The estimated cost to the Government of
Department of Defense civilian employees per-
forming the function.
(iii) Benefits in addition to price that war-
rant performance of the function by a particular
source at a cost higher than that of performance
by Department of Defense civilian employees.
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(iv) In addition to the cost referred to in
clause (i), an estimate of all other costs and ex-
penditures that the Government would incur be-
cause of the award of such a contract.
(B) Under the pilot program, subparagraph (A)
of such section 2461(b)(3) shall not apply to an anal-
ysis of the performance of an information technology
services function for the Department of Defense.
(3) CONTRACTING
FOR
INFORMATION
TECH-
NOLOGY SERVICES.—(A) Under the pilot program, ex-
cept as otherwise provided by law, the Secretary shall
procure information technology services necessary for
or beneficial to the accomplishment of the authorized
functions of the Department of Defense (other than
functions which the Secretary of Defense determines
must be performed by military or Government per-
sonnel) from a source in the private sector if perform-
ance by that source represents the best value to the
United States, determined in accordance with the
competition requirements of Office of Management
and Budget Circular A–76.
(B) Under the pilot program, section 2462(a) of
title 10, United States Code, shall not apply to a pro-
curement described in paragraph (1).
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(4) DURATION OF PILOT PROGRAM.—(A) The pe-
riod for which the pilot program may be carried out
under this subsection shall be fiscal years 2004
through 2008.
(B) An analysis commenced under the pilot pro-
gram in accordance with paragraph (2), and a pro-
curement for which a solicitation has been issued in
accordance with paragraph (3), before the end of the
pilot program period may be continued in accordance
with paragraph (2) or (3), respectively, after the end
of such period.
(5) GAO REVIEW.—(A) The Comptroller General
shall review the administration of any pilot program
carried out under this subsection to assess the extent
to which the program is effective and is equitable for
the potential public sources and the potential private
sources of information technology services for the De-
partment of Defense.
(B) Not later than February 1, 2008, the Comp-
troller General shall submit to the congressional de-
fense committees a report on the review of the pro-
gram under subparagraph (A). The report shall in-
clude the Comptroller General’s assessment of the
matters required under that subparagraph and any
other conclusions resulting from the review.
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(6) INFORMATION
TECHNOLOGY
SERVICES
DE-
FINED.—In this subsection, the term ‘‘information
technology service’’ means any service performed in
the operation or maintenance of information tech-
nology (as defined in section 11101 of title 40, United
States Code).
(b) RESOURCES-BASED SCHEDULES FOR COMPLETION
OF PUBLIC-PRIVATE COMPETITIONS.—
(1) APPLICATION OF TIMEFRAMES.—Any interim
or final deadline or other schedule-related milestone
for the completion of a Department of Defense public-
private competition shall be established solely on the
basis of considered research and sound analysis re-
garding the availability of sufficient personnel, train-
ing, and technical resources to the Department of De-
fense to carry out such competition in a timely man-
ner.
(2) EXTENSION OF TIMEFRAMES.—Any interim
or final deadline or other schedule-related milestone
established (consistent with paragraph (1)) for the
completion of a Department of Defense public-private
competition shall be extended if the Department of
Defense official responsible for managing the competi-
tion determines under procedures prescribed by the
Secretary of Defense that the personnel, training, or
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technical resources available to the Department of De-
fense to carry out such competition timely are insuffi-
cient.
SEC. 813. AUTHORITY TO ENTER INTO PERSONAL SERV-
ICES CONTRACTS.
(a) AUTHORITY.—Chapter 141 of title 10, United
States Code, is amended by inserting after section 2396 the
following new section:
‘‘§ 2397. Personal services: procurement by certain
elements of the Department of Defense
‘‘(a) AUTHORITY.—The head of an element of the De-
partment of Defense referred to in subsection (b) may enter
into a contract for the procurement of services described in
section 3109 of title 5 that are necessary to carry out a
mission of that element without regard to the limitations
in such section if the head of that element determines in
writing that the services to be procured are unique and that
it would not be practicable to obtain such services by other
means.
‘‘(b) APPLICABILITY.—Subsection (a) applies to—
‘‘(1) any element of the Department of Defense
within the intelligence community, as defined in sec-
tion 3(4) of the National Security Act of 1947 (50
U.S.C. 401a(4)); and
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‘‘(2) the United States Special Operations Com-
mand, with respect to special operations activities de-
scribed in paragraphs (1), (2), (3), and (4) of section
167(j) of this title.’’.
(b) CLERICAL AMENDMENT.—The table of sections at
the beginning of such chapter is amended by inserting after
the item relating to section 2396 the following new item:
‘‘2397. Personal services: procurement by certain elements of the Department of
Defense.’’.
Subtitle C—Major Defense
Acquisition Programs
SEC. 821. CERTAIN 
WEAPONS-RELATED 
PROTOTYPE
PROJECTS.
(a) EXTENSION OF AUTHORITY.—Subsection (g) of sec-
tion 845 of the National Defense Authorization Act for Fis-
cal Year 1994 (10 U.S.C. 2371 note) is amended by striking
‘‘September 30, 2004’’ and inserting ‘‘September 30, 2007’’.
(b) INCREASED SCOPE OF AUTHORITY.—Subsection
(a) of such section is amended by inserting before the period
at the end the following: ‘‘, or to improvement of weapons
or weapon systems in use by the Armed Forces’’.
(c) PILOT PROGRAM FOR TRANSITION TO FOLLOW-ON
CONTRACTS.—Such section, as amended by subsection (a),
is further amended—
(1) by redesignating subsections (e), (f), and (g)
as subsections (f), (g), and (h), respectively; and
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(2) by inserting after subsection (d) the following
new subsection (e):
‘‘(e) PILOT PROGRAM FOR TRANSITION TO FOLLOW-
ON CONTRACTS.—(1) The Secretary of Defense is authorized
to carry out a pilot program for follow-on contracting for
the production of items or processes that are developed by
nontraditional defense contractors under prototype projects
carried out under this section.
‘‘(2) Under the pilot program—
‘‘(A) a qualifying contract for the procurement of
such an item or process, or a qualifying subcontract
under a contract for the procurement of such an item
or process, may be treated as a contract or sub-
contract, respectively, for the procurement of commer-
cial items, as defined in section 4(12) of the Office of
Federal Procurement Policy Act (41 U.S.C. 403(12));
and
‘‘(B) the item or process may be treated as an
item or process, respectively, that is developed in part
with Federal funds and in part at private expense for
the purposes of section 2320 of title 10, United States
Code.
‘‘(3) For the purposes of the pilot program, a quali-
fying contract or subcontract is a contract or subcontract,
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respectively, with a nontraditional defense contractor
that—
‘‘(A) does not exceed $50,000,000; and
‘‘(B) is either—
‘‘(i) a firm, fixed-price contract or sub-
contract; or
‘‘(ii) a fixed-price contract or subcontract
with economic price adjustment.
‘‘(4) The authority to conduct a pilot program under
this subsection shall terminate on September 30, 2007. The
termination of the authority shall not affect the validity
of contracts or subcontracts that are awarded or modified
during the period of the pilot program, without regard to
whether the contracts or subcontracts are performed during
the period.’’.
SEC. 822. APPLICABILITY OF CLINGER-COHEN ACT POLI-
CIES AND REQUIREMENTS TO EQUIPMENT IN-
TEGRAL TO A WEAPON OR WEAPON SYSTEM.
(a) IN GENERAL.—(1) Chapter 131 of title 10, United
States Code, is amended by inserting after section 2223 the
following:
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‘‘§ 2223a. Acquisition of equipment integral to a
weapon or a weapon system: applicability
of certain acquisition reform authorities
and information technology-related re-
quirements
‘‘(a) BOARD OF SENIOR ACQUISITION OFFICIALS.—(1)
The Secretary of Defense shall establish a board of senior
acquisition officials to administer the implementation of the
policies and requirements of chapter 113 of title 40 in pro-
curements of information technology equipment determined
by the Secretary as being an integral part of a weapon or
a weapon system.
‘‘(2) The Board shall be composed of the following offi-
cials:
‘‘(A) Under Secretary of Defense for Acquisition,
Technology, and Logistics, who shall be the Chair-
man.
‘‘(B) The acquisition executive of each of the
military departments.
‘‘(C) The Chief Information Officer of the De-
partment of Defense.
‘‘(c) RESPONSIBILITIES OF BOARD.—The Board shall
be responsible for ensuring that—
‘‘(1) the acquisition of information technology
equipment determined by the Secretary of Defense as
being an integral part of a weapon or a weapon sys-
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tem is conducted in a manner that is consistent with
the capital planning, investment control, and per-
formance and results-based management processes and
requirements provided under sections 11302, 11303,
11312, and 11313 of title 40, to the extent that such
processes requirements are applicable to the acquisi-
tion of such equipment;
‘‘(2) issues of spectrum availability, interoper-
ability, and information security are appropriately
addressed in the development of weapons and weapon
systems; and
‘‘(3) in the case of information technology equip-
ment that is to be incorporated into a weapon or a
weapon system under a major defense acquisition
program, the information technology equipment is in-
corporated in a manner that is consistent with—
‘‘(A) the planned approach to applying cer-
tain provisions of law to major defense acquisi-
tion programs following the evolutionary acqui-
sition process that the Secretary of Defense re-
ported to Congress under section 802 of the Bob
Stump National Defense Authorization Act for
Fiscal Year 2003 (Public Law 107–314; 116
Stat. 2602);
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‘‘(B) the acquisition policies that apply to
spiral development programs under section 803
of such Act (116 Stat. 2603; 10 U.S.C. 2430
note); and
‘‘(C) the software acquisition processes of
the military department or Defense Agency con-
cerned under section 804 of such Act (116 Stat.
2604; 10 U.S.C. 2430 note).
‘‘(d) INAPPLICABILITY
OF OTHER LAWS.—The fol-
lowing provisions of law do not apply to information tech-
nology equipment that is determined by the Secretary of
Defense as being an integral part of a weapon or a weapon
system:
‘‘(1) Section 11315 of title 40.
‘‘(2) The policies and procedures established
under section 11316 of title 40.
‘‘(3) Subsections (d) and (e) of section 811 of the
Floyd D. Spence National Defense Authorization Act
for Fiscal Year 2001 (as enacted into law by Public
Law 106–398; 114 Stat. 1654A–211), and the re-
quirements and prohibitions that are imposed by De-
partment of Defense Directive 5000.1 pursuant to
subsections (b) and (c) of such section.
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‘‘(4) Section 351 of the Bob Stump National De-
fense Authorization Act for Fiscal Year 2003 (Public
Law 107–314; 116 Stat. 2516; 10 U.S.C. 221 note).
‘‘(e) DEFINITIONS.—In this section:
‘‘(1) The term ‘acquisition executive’, with re-
spect to a military department, means the official
who is designated as the senior procurement executive
of the military department under section 16(3) of the
Office of Federal Procurement Policy Act (41 U.S.C.
414(3)).
‘‘(2) The term ‘information technology’ has the
meaning given such term in section 11101 of title 40.
‘‘(3) The term ‘major defense acquisition pro-
gram’ has the meaning given such term in section
2430 of this title.’’.
(2) The table of sections at the beginning of such chap-
ter is amended by inserting after the item relating to section
2223 the following new item:
‘‘2223a. Acquisition of equipment integral to a weapon or a weapon system: ap-
plicability of certain acquisition reform authorities and infor-
mation technology-related requirements.’’.
(b) CONFORMING AMENDMENT.—Section 2223 of such
title is amended by adding at the end the following new
subsection:
‘‘(c) EQUIPMENT INTEGRAL TO A WEAPON OR WEAPON
SYSTEM.—(1) In the case of information technology equip-
ment determined by the Secretary of Defense as being an
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integral part of a weapon or a weapon system, the respon-
sibilities under this section shall be performed by the board
of senior acquisition officials established pursuant to section
2223a of this title.
‘‘(2) In this subsection, the term ‘information tech-
nology’ has the meaning given such term in section 11101
of title 40.’’.
SEC. 823. APPLICABILITY OF REQUIREMENT FOR REPORTS
ON MATURITY OF TECHNOLOGY AT INITI-
ATION OF MAJOR DEFENSE ACQUISITION
PROGRAMS.
Section 804(a) of the National Defense Authorization
Act for Fiscal Year 2003 (Public Law 107–107; 115 Stat.
1180) is amended by striking ‘‘, as in effect on the date
of enactment of this Act,’’ and inserting ‘‘(as in effect on
the date of the enactment of this Act), and the corresponding
provision of any successor to such Instruction,’’.
Subtitle D—Domestic Source
Requirements
SEC. 831. EXCEPTIONS TO BERRY AMENDMENT FOR CON-
TINGENCY OPERATIONS AND OTHER URGENT
SITUATIONS.
Section 2533a(d) of title 10, United States Code, is
amended—
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(1) in paragraph (1), by inserting ‘‘or contin-
gency operations’’ after ‘‘in support of combat oper-
ations’’; and
(2) by adding at the end the following new para-
graph:
‘‘(4) Procurements for which the use of proce-
dures other than competitive procedures has been ap-
proved on the basis of section 2304(c)(2) of this title,
relating to unusual and compelling urgency of need.’’.
SEC. 832. INAPPLICABILITY OF BERRY AMENDMENT TO
PROCUREMENTS OF WASTE AND BYPROD-
UCTS OF COTTON AND WOOL FIBER FOR USE
IN THE PRODUCTION OF PROPELLANTS AND
EXPLOSIVES.
Section 2533a(f) of title 10, United States Code, is
amended—
(1) by striking ‘‘(f) EXCEPTION’’ and all that fol-
lows through ‘‘the procurement of’’ and inserting the
following:
‘‘(f) EXCEPTIONS FOR CERTAIN OTHER COMMODITIES
AND ITEMS.—Subsection (a) does not preclude the procure-
ment of the following:
‘‘(1)’’;
(2) by capitalizing the initial letter of the word
following ‘‘(1)’’, as added by paragraph (1); and
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(3) by adding at the end the following new para-
graph:
‘‘(2) Waste and byproducts of cotton and wool
fiber for use in the production of propellants and ex-
plosives.’’.
SEC. 833. WAIVER AUTHORITY FOR DOMESTIC SOURCE OR
CONTENT REQUIREMENTS.
(a) AUTHORITY.—Subchapter V of chapter 148 of title
10, United States Code, is amended by adding at the end
the following new section:
‘‘§ 2539c. Waiver of domestic source or content re-
quirements
‘‘(a) AUTHORITY.—Except as provided in subsection
(f), the Secretary of Defense may waive the application of
any domestic source requirement or domestic content re-
quirement referred to in subsection (b) and thereby author-
ize the procurement of items that are grown, reprocessed,
reused, produced, or manufactured—
‘‘(1) in a foreign country that has a Declaration
of Principles with the United States;
‘‘(2) in a foreign country that has a Declaration
of Principles with the United States substantially
from components and materials grown, reprocessed,
reused, produced, or manufactured in the United
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States or any foreign country that has a Declaration
of Principles with the United States; or
‘‘(3) in the United States substantially from
components and materials grown, reprocessed, reused,
produced, or manufactured in the United States or
any foreign country that has a Declaration of Prin-
ciples with the United States.
‘‘(b) COVERED REQUIREMENTS.—For purposes of this
section:
‘‘(1) A domestic source requirement is any re-
quirement under law that the Department of Defense
satisfy its requirements for an item by procuring an
item that is grown, reprocessed, reused, produced, or
manufactured in the United States or by a manufac-
turer that is a part of the national technology and in-
dustrial base (as defined in section 2500(1) of this
title).
‘‘(2) A domestic content requirement is any re-
quirement under law that the Department of Defense
satisfy its requirements for an item by procuring an
item produced or manufactured partly or wholly from
components and materials grown, reprocessed, reused,
produced, or manufactured in the United States.
‘‘(c) APPLICABILITY.—The authority of the Secretary
to waive the application of a domestic source or content
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requirements under subsection (a) applies to the procure-
ment of items for which the Secretary of Defense determines
that—
‘‘(1) application of the requirement would im-
pede the reciprocal procurement of defense items
under a Declaration of Principles with the United
States; and
‘‘(2) such country does not discriminate against
defense items produced in the United States to a
greater degree than the United States discriminates
against defense items produced in that country.
‘‘(d) LIMITATION ON DELEGATION.—The authority of
the Secretary to waive the application of domestic source
or content requirements under subsection (a) may not be
delegated to any officer or employee other than the Under
Secretary of Defense for Acquisition, Technology and Logis-
tics.
‘‘(e) CONSULTATIONS.—The Secretary may grant a
waiver of the application of a domestic source or content
requirement under subsection (a) only after consultation
with the United States Trade Representative, the Secretary
of Commerce, and the Secretary of State.
‘‘(f) LAWS NOT WAIVABLE.—The Secretary of Defense
may not exercise the authority under subsection (a) to
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(3) $87,000,000 (the balance of the amount au-
thorized under section 2101(a) for construction of a
Lewis and Clark instructional facility, Fort Leaven-
worth, Kansas);
(4) $43,000,000 (the balance of the amount au-
thorized under section 2101(a) for the construction of
a barracks complex, Wheeler-Sack Army Airfield, Fort
Drum, New York); and
(5) $50,000,000 (the balance of the amount au-
thorized under section 2101(a) for construction of a
barracks complex, Bastogne Drive, Fort Bragg, North
Carolina).
SEC. 2105. TERMINATION OF AUTHORITY TO CARRY OUT
CERTAIN FISCAL YEAR 2003 PROJECTS.
(a) MILITARY CONSTRUCTION PROJECTS OUTSIDE
THE UNITED STATES.—The table in section 2101(b) of the
Military Construction Authorization Act for Fiscal Year
2003 (division B of Public Law 107–314; 116 Stat. 2682)
is amended—
(1) by striking the item relating to Area Support
Group, Bamberg, Germany;
(2) by striking the item relating to Coleman
Barracks, Germany;
(3) by striking the item relating to Darmstadt,
Germany;