H. R. 1735—184 
(1) bringing technologies to maturity and identifying the 
manufacturing processes that will be needed to carry out the 
program; 
(2) ensuring continuing focus during program development 
on meeting stated mission requirements and other require-
ments of the Department of Defense; 
(3) 
recommending 
trade-offs 
between 
program 
cost, 
schedule, and performance for the life-cycle of the program; 
(4) developing a business case for the program; and 
(5) ensuring that appropriate information is available to 
the milestone decision authority to make a decision on Mile-
stone B approval (or Key Decision Point B approval in the 
case of a space program), including information necessary to 
make the certification required by section 2366a of title 10, 
United States Code. 
(d) QUALIFICATIONS, RESOURCES, AND TENURE.—The Secretary 
of Defense shall ensure that each program manager for the program 
definition period of a major defense acquisition program— 
(1) has the appropriate management, engineering, tech-
nical, and financial expertise needed to meet the responsibilities 
assigned pursuant to subsection (c); 
(2) is provided the resources and support (including systems 
engineering expertise, cost-estimating expertise, and software 
development expertise) needed to meet such responsibilities; 
and 
(3) is assigned to the program manager position for such 
program until such time as such program receives Milestone 
B approval (or Key Decision Point B approval in the case 
of a space program), unless removed for cause or due to excep-
tional circumstances. 
(e) WAIVER AUTHORITY.—The Secretary may waive the require-
ment in paragraph (3) of subsection (d) upon a determination that 
the program definition period will take so long that it would not 
be appropriate for a single individual to serve as program manager 
for the entire period covered by such paragraph. 
SEC. 827. TENURE AND ACCOUNTABILITY OF PROGRAM MANAGERS 
FOR PROGRAM EXECUTION PERIODS. 
(a) REVISED GUIDANCE REQUIRED.—Not later than 180 days 
after the date of the enactment of this Act, the Secretary of Defense 
shall revise Department of Defense guidance for major defense 
acquisition programs to address the tenure and accountability of 
program managers for the program execution period of major 
defense acquisition programs. 
(b) PROGRAM EXECUTION PERIOD.—For purposes of this section, 
the term ‘‘program execution period’’, with respect to a major 
defense acquisition program, means the period beginning with Mile-
stone B approval (or Key Decision Point B approval in the case 
of a space program) and ending with declaration of initial oper-
ational capability. 
(c) RESPONSIBILITIES.—The revised guidance required by sub-
section (a) shall— 
(1) require the program manager for the program execution 
period of a major defense acquisition program to enter into 
a performance agreement with the manager’s immediate super-
visor for such program within six months of assignment, that—
H. R. 1735—185 
(A) establishes expected parameters for the cost, 
schedule, and performance of the program consistent with 
the business case for the program; 
(B) provides the commitment of the supervisor to pro-
vide the level of funding and resources required to meet 
such parameters; and 
(C) provides the assurance of the program manager 
that such parameters are achievable and that the program 
manager will be accountable for meeting such parameters; 
and 
(2) provide the program manager with the authority to— 
(A) consult on the addition of new program require-
ments that would be inconsistent with the parameters 
established in the performance agreement entered into 
pursuant to paragraph (1); 
(B) recommend trade-offs between cost, schedule, and 
performance, provided that such trade-offs are consistent 
with the parameters established in the performance agree-
ment entered into pursuant to paragraph (1); and 
(C) develop such interim goals and milestones as may 
be required to achieve the parameters established in the 
performance agreement entered into pursuant to paragraph 
(1). 
(d) QUALIFICATIONS, RESOURCES, AND TENURE.—The Secretary 
shall ensure that each program manager for the program execution 
period of a defense acquisition program— 
(1) has the appropriate management, engineering, tech-
nical, and financial expertise needed to meet the responsibilities 
assigned pursuant to subsection (c); 
(2) is provided the resources and support (including systems 
engineering expertise, cost estimating expertise, and software 
development expertise) needed to meet such responsibilities; 
and 
(3) is assigned to the program manager position for such 
program during the program execution period, unless removed 
for cause or due to exceptional circumstances. 
(e) WAIVER AUTHORITY.—The immediate supervisor of a pro-
gram manager for a major defense acquisition program may waive 
the requirement in paragraph (3) of subsection (d) upon a deter-
mination that the program execution period will take so long that 
it would not be appropriate for a single individual to serve as 
program manager for the entire program execution period. 
SEC. 828. PENALTY FOR COST OVERRUNS. 
(a) IN GENERAL.—For each fiscal year beginning with fiscal 
year 2015, the Secretary of each military department shall pay 
a penalty for cost overruns on the covered major defense acquisition 
programs of the military department. 
(b) CALCULATION OF PENALTY.—For the purposes of this section: 
(1) The amount of the cost overrun or underrun on any 
major defense acquisition program or subprogram in a fiscal 
year is the difference between the current program acquisition 
unit cost for the program or subprogram and the program 
acquisition unit cost for the program as shown in the original 
Baseline Estimate for the program or subprogram, multiplied 
by the quantity of items to be purchased under the program 
or subprogram, as reported in the final Selected Acquisition
H. R. 1735—186 
Report for the fiscal year in accordance with section 2432 
of title 10, United States Code. 
(2) Cost overruns or underruns for covered major defense 
acquisition programs that are joint programs of more than 
one military department shall be allocated among the military 
departments in percentages determined by the Under Secretary 
of Defense for Acquisition, Technology, and Logistics. 
(3) The cumulative amount of cost overruns for a military 
department in a fiscal year is the sum of the cost overruns 
and cost underruns for all covered major defense acquisition 
programs of the department in the fiscal year (including cost 
overruns or underruns allocated to the military department 
in accordance with paragraph (2)). 
(4) The cost overrun penalty for a military department 
in a fiscal year is three percent of the cumulative amount 
of cost overruns of the military department in the fiscal year, 
as determined pursuant to paragraph (3), except that the cost 
overrun penalty may not be a negative amount. 
(c) TRANSFER OF FUNDS.— 
(1) REDUCTION
OF
RESEARCH, DEVELOPMENT, TEST, AND 
EVALUATION ACCOUNTS.—Not later than 60 days after the end 
of each fiscal year beginning with fiscal year 2015, the Secretary 
of each military department shall reduce each research, 
development, test, and evaluation account of the military 
department by the percentage determined under paragraph 
(2), and remit such amount to the Secretary of Defense. 
(2) DETERMINATION OF AMOUNT.—The percentage reduction 
to research, development, test, and evaluation accounts of a 
military department referred to in paragraph (1) is the percent-
age reduction to such accounts necessary to equal the cost 
overrun penalty for the fiscal year for such department deter-
mined pursuant to subsection (b)(4). 
(3) CREDITING
OF
FUNDS.—Any amount remitted under 
paragraph (1) shall be credited to the Rapid Prototyping Fund 
established pursuant to section 804 of this Act. 
(d) COVERED PROGRAMS.—A major defense acquisition program 
is covered under this section if the original Baseline Estimate 
was established for such program under paragraph (1) or (2) of 
section 2435(d) of title 10, United States Code, on or after May 
22, 2009 (which is the date of the enactment of the Weapon Systems 
Acquisition Reform Act of 2009 (Public Law 111–23)). 
SEC. 
829. 
STREAMLINING 
OF 
REPORTING 
REQUIREMENTS 
APPLICABLE TO ASSISTANT SECRETARY OF DEFENSE FOR 
RESEARCH 
AND 
ENGINEERING 
REGARDING 
MAJOR 
DEFENSE ACQUISITION PROGRAMS. 
(a) REPORTING TO UNDER SECRETARY OF DEFENSE FOR ACQUISI-
TION, 
TECHNOLOGY, 
AND
LOGISTICS
BEFORE
MILESTONE
B 
APPROVAL.—Subparagraph (A) of paragraph (8) of section 138(b) 
of title 10, United States Code, as amended by section 901(h)(2) 
of the Carl Levin and Howard P. ‘‘Buck’’ McKeon National Defense 
Authorization Act for Fiscal Year 2015 (Public Law 113–291; 128 
Stat. 3466), is further amended— 
(1) by striking ‘‘periodically’’; 
(2) by striking ‘‘the major defense acquisition programs’’ 
and inserting ‘‘each major defense acquisition program’’;
H. R. 1735—187 
(3) by inserting ‘‘before the Milestone B approval for that 
program’’ after ‘‘Department of Defense’’; and 
(4) by striking ‘‘such reviews and assessments’’ and 
inserting ‘‘such review and assessment’’. 
(b) ANNUAL REPORT TO SECRETARY OF DEFENSE AND CONGRES-
SIONAL DEFENSE COMMITTEES.—Subparagraph (B) of such para-
graph is amended by inserting ‘‘for which a Milestone B approval 
occurred during the preceding fiscal year’’ after ‘‘Department of 
Defense’’. 
SEC. 830. CONFIGURATION STEERING BOARDS FOR COST CONTROL 
UNDER MAJOR DEFENSE ACQUISITION PROGRAMS. 
Section 814(c)(1) of the Duncan Hunter National Defense 
Authorization Act for Fiscal Year 2009 (Public Law 110–417; 122 
Stat. 4529; 10 U.S.C. 2430 note) is amended— 
(1) by redesignating subparagraphs (A), (B), and (C) as 
subparagraphs (B), (C), and (D), respectively; and 
(2) by inserting after ‘‘for the following:’’ the following new 
subparagraph: 
‘‘(A) Monitoring changes in program requirements and 
ensuring the Chief of Staff of the Armed Force concerned, 
in consultation with the Secretary of the military depart-
ment concerned, approves of any proposed changes that 
could have an adverse effect on program cost or schedule.’’. 
SEC. 831. REPEAL OF REQUIREMENT FOR STAND-ALONE MANPOWER 
ESTIMATES FOR MAJOR DEFENSE ACQUISITION PRO-
GRAMS. 
(a) REPEAL OF REQUIREMENT.—Subsection (a)(1) of section 2434 
of title 10, United States Code, is amended by striking ‘‘and a 
manpower estimate for the program have’’ and inserting ‘‘has’’. 
(b) CONFORMING AMENDMENTS RELATING TO REGULATIONS.— 
Subsection (b) of such section is amended— 
(1) by striking paragraph (2); 
(2) by striking ‘‘shall require—’’ and all that follows through 
‘‘that the independent’’ and inserting ‘‘shall require that the 
independent’’; 
(3) by redesignating subparagraphs (A) and (B) as para-
graphs (1) and (2), respectively, and moving those paragraphs, 
as so redesignated, two ems to the left; and 
(4) in paragraph (2), as so redesignated— 
(A) by striking ‘‘and operations and support,’’ and 
inserting ‘‘operations and support, and trained manpower 
to operate, maintain, and support the program upon full 
operational deployment,’’; and 
(B) by striking ‘‘; and’’ and inserting a period. 
(c) CLERICAL AMENDMENTS.— 
(1) SECTION
HEADING.—The heading of such section is 
amended to read as follows: 
‘‘§ 2434. Independent cost estimates’’. 
(2) TABLE OF SECTIONS.—The table of sections at the begin-
ning of chapter 144 of such title is amended by striking the 
item relating to section 2434 and inserting the following: 
‘‘2434. Independent cost estimates.’’.
H. R. 1735—188 
SEC. 832. REVISION TO DUTIES OF THE DEPUTY ASSISTANT SEC-
RETARY OF DEFENSE FOR DEVELOPMENTAL TEST AND 
EVALUATION AND THE DEPUTY ASSISTANT SECRETARY OF 
DEFENSE FOR SYSTEMS ENGINEERING. 
Section 139b of title 10, United States Code, is amended— 
(1) in subsection (a)(5)— 
(A) in subparagraph (B), by striking ‘‘and approve or 
disapprove’’; and 
(B) in subparagraph (C), by inserting ‘‘in order to 
advise relevant technical authorities for such programs 
on the incorporation of best practices for developmental 
test from across the Department’’ after ‘‘in accordance with 
subsection (c))’’; and 
(2) in subsection (b)(5)— 
(A) in subparagraph (B), by striking ‘‘and approve’’; 
and 
(B) in subparagraph (C), by inserting ‘‘in order to 
advise relevant technical authorities for such programs 
on the incorporation of best practices for systems 
engineering from across the Department’’ after ‘‘programs’’. 
Subtitle D—Provisions Relating to 
Acquisition Workforce 
SEC. 841. AMENDMENTS TO DEPARTMENT OF DEFENSE ACQUISITION 
WORKFORCE DEVELOPMENT FUND. 
(a) MODIFICATIONS TO DEPARTMENT OF DEFENSE ACQUISITION 
WORKFORCE DEVELOPMENT FUND.—Section 1705 of title 10, United 
States Code, is amended— 
(1) in subsection (d)— 
(A) in paragraph (2), by amending subparagraph (C) 
to read as follows: 
‘‘(C) For purposes of this paragraph, the applicable 
percentage for a fiscal year is the percentage that results 
in the credit to the Fund of $500,000,000 in each fiscal 
year.’’; 
(B) in paragraph (2), in subparagraph (D)— 
(i) by striking ‘‘an amount specified in subpara-
graph (C)’’ and inserting ‘‘the amount specified in 
subparagraph (C)’’; and 
(ii) by striking ‘‘an amount that is less than’’ and 
all that follows through the end and inserting ‘‘an 
amount that is less than $400,000,000.’’; and 
(C) in paragraph (3), by striking ‘‘24-month period’’ 
and inserting ‘‘36-month period’’; 
(2) in subsection (f), by striking ‘‘60 days’’ and inserting 
‘‘120 days’’; and 
(3) in subsection (g)— 
(A) by striking paragraph (2); 
(B) by striking ‘‘acquisition workforce positions’’ and 
inserting ‘‘of positions in the acquisition workforce, as 
defined in subsection (h),’’; 
(C) by striking ‘‘AUTHORITY.—’’ and all that follows 
through ‘‘For purposes of’’ in paragraph (1) and inserting 
‘‘AUTHORITY.—For purposes of’’;
H. R. 1735—189 
(D) by striking ‘‘(A)’’ and inserting ‘‘(1)’’; 
(E) by striking ‘‘(B)’’ and inserting ‘‘(2)’’; and 
(F) by aligning paragraphs (1) and (2), as designated 
by subparagraphs (D) and (E), so as to be two ems from 
the left margin. 
(b) MODIFICATIONS
TO
BIENNIAL
STRATEGIC
WORKFORCE 
PLAN.—Section 115b(d) of title 10, United States Code, is 
amended— 
(1) in paragraph (1), by striking ‘‘the defense acquisition 
workforce, including both military and civilian personnel’’ and 
inserting ‘‘the military, civilian, and contractor personnel that 
directly support the acquisition processes of the Department 
of Defense, including persons serving in acquisition-related posi-
tions designated by the Secretary of Defense under section 
1721 of this title’’; 
(2) in paragraph (2)(D)— 
(A) in clause (i), by striking ‘‘; and’’ and inserting 
a semicolon; 
(B) by redesignating clause (ii) as clause (iii); and 
(C) by inserting after clause (i) the following new 
clause: 
‘‘(ii) a description of steps that will be taken to address 
any new or expanded critical skills and competencies the 
civilian employee workforce will need to address recent 
trends in defense acquisition, emerging best practices, 
changes in the Government and commercial marketplace, 
and new requirements established in law or regulation; 
and’’; and 
(3) by adding at the end the following new paragraph: 
‘‘(3) For the purposes of paragraph (1), contractor personnel 
shall be treated as directly supporting the acquisition processes 
of the Department if, and to the extent that, such contractor per-
sonnel perform functions in support of personnel in Department 
of Defense positions designated by the Secretary of Defense under 
section 1721 of this title.’’. 
SEC. 842. DUAL-TRACK MILITARY PROFESSIONALS IN OPERATIONAL 
AND ACQUISITION SPECIALITIES. 
(a) REQUIREMENT FOR CHIEF OF STAFF INVOLVEMENT.—Section 
1722a(a) of title 10, United States Code, is amended by inserting 
after ‘‘military department)’’ the following: ‘‘, in collaboration with 
the Chief of Staff of the Army, the Chief of Naval Operations, 
the Chief of Staff of the Air Force, and the Commandant of the 
Marine Corps (with respect to the Army, Navy, Air Force, and 
Marine Corps, respectively),’’. 
(b) DUAL-TRACK CAREER PATH.—Section 1722a(b) of such title 
is amended— 
(1) by redesignating paragraphs (2) and (3) as paragraphs 
(3) and (4), respectively; 
(2) in paragraph (1), by inserting ‘‘single-track’’ before 
‘‘career path’’; and 
(3) by inserting after paragraph (1) the following new para-
graph (2): 
‘‘(2) A dual-track career path that attracts the highest 
quality officers and enlisted personnel and allows them to gain 
experience in and receive credit for a primary career in combat 
arms and a functional secondary career in the acquisition field
H. R. 1735—190 
in order to more closely align the military operational, require-
ments, and acquisition workforces of each armed force.’’. 
SEC. 843. PROVISION OF JOINT DUTY ASSIGNMENT CREDIT FOR 
ACQUISITION DUTY. 
Section 668(a)(1) of title 10, United States Code, is amended— 
(1) by striking ‘‘or’’ at the end of subparagraph (D); 
(2) by striking the period at the end of subparagraph (E) 
and inserting ‘‘; or’’; and 
(3) by adding at the end the following new subparagraph: 
‘‘(F) acquisition matters addressed by military personnel 
and covered under chapter 87 of this title.’’. 
SEC. 844. MANDATORY REQUIREMENT FOR TRAINING RELATED TO 
THE CONDUCT OF MARKET RESEARCH. 
(a) MANDATORY MARKET RESEARCH TRAINING.—Section 2377 
of title 10, United States Code, is amended by adding at the end 
the following new subsection: 
‘‘(d) MARKET RESEARCH TRAINING REQUIRED.—The Secretary 
of Defense shall provide mandatory training for members of the 
armed forces and employees of the Department of Defense respon-
sible for the conduct of market research required under subsection 
(c). Such mandatory training shall, at a minimum— 
‘‘(1) provide comprehensive information on the subject of 
market research and the function of market research in the 
acquisition of commercial items; 
‘‘(2) teach best practices for conducting and documenting 
market research; and 
‘‘(3) provide methodologies for establishing standard proc-
esses and reports for collecting and sharing market research 
across the Department.’’. 
(b) 
INCORPORATION
INTO
MANAGEMENT
CERTIFICATION 
TRAINING MANDATE.—The Chairman of the Joint Chiefs of Staff 
shall ensure that the requirements of section 2377(d) of title 10, 
United States Code, as added by subsection (a), are incorporated 
into the requirements management certification training mandate 
of the Joint Capabilities Integration Development System. 
SEC. 845. INDEPENDENT STUDY OF IMPLEMENTATION OF DEFENSE 
ACQUISITION WORKFORCE IMPROVEMENT EFFORTS. 
(a) REQUIREMENT FOR STUDY.—Not later than 30 days after 
the date of the enactment of this Act, the Secretary of Defense 
shall enter into a contract with an independent research entity 
described in subsection (b) to carry out a comprehensive study 
of the strategic planning of the Department of Defense related 
to the defense acquisition workforce. The study shall provide a 
comprehensive examination of the Department’s efforts to recruit, 
develop, and retain the acquisition workforce with a specific review 
of the following: 
(1) The implementation of the Defense Acquisition 
Workforce Improvement Act (including chapter 87 of title 10, 
United States Code). 
(2) The application of the Department of Defense Acquisi-
tion Workforce Development Fund (as established under section 
1705 of title 10, United States Code). 
(3) The effectiveness of professional military education pro-
grams, including fellowships and exchanges with industry.
H. R. 1735—191 
(b) INDEPENDENT RESEARCH ENTITY.—The entity described in 
this subsection is an independent research entity that is a not- 
for-profit entity or a federally funded research and development 
center with appropriate expertise and analytical capability. 
(c) REPORTS.— 
(1) TO SECRETARY.—Not later than one year after the date 
of the enactment of this Act, the independent research entity 
shall provide to the Secretary a report containing— 
(A) the results of the study required by subsection 
(a); and 
(B) such recommendations to improve the acquisition 
workforce as the independent research entity considers to 
be appropriate. 
(2) TO CONGRESS.—Not later than 30 days after receipt 
of the report under paragraph (1), the Secretary of Defense 
shall submit such report, together with any additional views 
or recommendations of the Secretary, to the congressional 
defense committees. 
SEC. 846. EXTENSION OF AUTHORITY FOR THE CIVILIAN ACQUISITION 
WORKFORCE PERSONNEL DEMONSTRATION PROJECT. 
(a) EXTENSION.—Section 1762(g) of title 10, United States Code, 
is amended by striking ‘‘September 30, 2017’’ and inserting 
‘‘December 31, 2020’’. 
(b) TECHNICAL AMENDMENT.—Such section is further amended 
by striking ‘‘demonstration program’’ and inserting ‘‘demonstration 
project’’. 
Subtitle E—Provisions Relating to 
Commercial Items 
SEC. 851. PROCUREMENT OF COMMERCIAL ITEMS. 
(a) COMMERCIAL ITEM DETERMINATIONS
BY DEPARTMENT
OF 
DEFENSE.— 
(1) IN GENERAL.—Chapter 140 of title 10, United States 
Code, is amended by adding at the end the following new 
section: 
‘‘§ 2380. Commercial item determinations by Department of 
Defense 
‘‘The Secretary of Defense shall— 
‘‘(1) establish and maintain a centralized capability with 
necessary expertise and resources to oversee the making of 
commercial item determinations for the purposes of procure-
ments by the Department of Defense; and 
‘‘(2) provide public access to Department of Defense 
commercial item determinations for the purposes of procure-
ments by the Department of Defense.’’. 
(2) CLERICAL AMENDMENT.—The table of sections at the 
beginning of such chapter is amended by adding at the end 
the following new item: 
‘‘2380. Commercial item determinations by Department of Defense.’’. 
(b) COMMERCIAL ITEM EXCEPTION TO SUBMISSION OF COST AND 
PRICING DATA.—Section 2306a(b) of title 10, United States Code, 
is amended by adding at the end the following new paragraph:
H. R. 1735—192 
‘‘(4) COMMERCIAL ITEM DETERMINATION.—(A) For purposes 
of applying the commercial item exception under paragraph 
(1)(B) to the required submission of certified cost or pricing 
data, the contracting officer may presume that a prior commer-
cial item determination made by a military department, a 
Defense Agency, or another component of the Department of 
Defense shall serve as a determination for subsequent procure-
ments of such item. 
‘‘(B) If the contracting officer does not make the presump-
tion described in subparagraph (A) and instead chooses to pro-
ceed with a procurement of an item previously determined 
to be a commercial item using procedures other than the proce-
dures authorized for the procurement of a commercial item, 
the contracting officer shall request a review of the commercial 
item determination by the head of the contracting activity. 
‘‘(C) Not later than 30 days after receiving a request for 
review of a commercial item determination under subparagraph 
(B), the head of a contracting activity shall— 
‘‘(i) confirm that the prior determination was appro-
priate and still applicable; or 
‘‘(ii) issue a revised determination with a written expla-
nation of the basis for the revision.’’. 
(c) DEFINITION OF COMMERCIAL ITEM.—Nothing in this section 
or the amendments made by this section shall affect the meaning 
of the term ‘‘commercial item’’ under subsection (a)(5) of section 
2464 of title 10, United States Code, or any requirement under 
subsection (a)(3) or subsection (c) of such section. 
(d) REGULATIONS UPDATE.—Not later than 180 days after the 
date of the enactment of this Act, the Defense Federal Acquisition 
Regulation Supplement shall be updated to reflect the requirements 
of this section and the amendments made by this section. 
(e) RULE OF CONSTRUCTION.—Nothing in this section or the 
amendments made by this section shall be construed to preclude 
the contracting officer for the procurement of a commercial item 
from requiring the contractor to supply information that is sufficient 
to determine the reasonableness of price, regardless of whether 
or not the contractor was required to provide such information 
in connection with any earlier procurement. 
SEC. 852. MODIFICATION TO INFORMATION REQUIRED TO BE SUB-
MITTED BY OFFEROR IN PROCUREMENT OF MAJOR 
WEAPON SYSTEMS AS COMMERCIAL ITEMS. 
(a) REQUIREMENT FOR DETERMINATION.—Subsection (a) of sec-
tion 2379 of title 10, United States Code, is amended— 
(1) in paragraph (1)(B), by inserting ‘‘and’’ after the semi-
colon; 
(2) by striking paragraph (2); and 
(3) by redesignating paragraph (3) as paragraph (2). 
(b) TREATMENT OF SUBSYSTEMS AS COMMERCIAL ITEMS.—Sub-
section (b) of such section is amended— 
(1) in the matter preceding paragraph (1), by striking ‘‘only 
if’’ and inserting ‘‘if either’’; 
(2) in paragraph (2)— 
(A) by striking ‘‘that—’’ and all that follows through 
‘‘the subsystem is a’’ and inserting ‘‘that the subsystem 
is a’’; 
(B) by striking ‘‘; and’’ and inserting a period; and
H. R. 1735—193 
(C) by striking subparagraph (B). 
(c) TREATMENT OF COMPONENTS AS COMMERCIAL ITEMS.—Sub-
section (c)(1) of such section is amended— 
(1) by striking ‘‘title only if’’ and inserting ‘‘title if either’’; 
and 
(2) in subparagraph (B)— 
(A) by striking ‘‘that—’’ and all that follows through 
‘‘the component or’’ and inserting ‘‘that the component or’’; 
(B) by striking ‘‘; and’’ and inserting a period; and 
(C) by striking clause (ii). 
(d) INFORMATION SUBMITTED.—Subsection (d) of such section 
is amended to read as follows: 
‘‘(d) INFORMATION SUBMITTED.—(1) To the extent necessary to 
determine the reasonableness of the price for items acquired under 
this section, the contracting officer shall require the offeror to 
submit— 
‘‘(A) prices paid for the same or similar commercial items 
under comparable terms and conditions by both Government 
and commercial customers; 
‘‘(B) if the contracting officer determines that the offeror 
does not have access to and cannot provide sufficient informa-
tion described in subparagraph (A) to determine the reasonable-
ness of price, information on— 
‘‘(i) prices for the same or similar items sold under 
different terms and conditions; 
‘‘(ii) prices for similar levels of work or effort on related 
products or services; 
‘‘(iii) prices for alternative solutions or approaches; and 
‘‘(iv) other relevant information that can serve as the 
basis for a price assessment; and 
‘‘(C) if the contracting officer determines that the informa-
tion submitted pursuant to subparagraphs (A) and (B) is not 
sufficient to determine the reasonableness of price, other rel-
evant information regarding the basis for price or cost, including 
information on labor costs, material costs, and overhead rates. 
‘‘(2) An offeror may not be required to submit information 
described in paragraph (1)(C) with regard to a commercially avail-
able off-the-shelf item and may be required to submit such informa-
tion with regard to any other item that was developed exclusively 
at private expense only after the head of the contracting activity 
determines in writing that the information submitted pursuant 
to paragraphs (1)(A) and (1)(B) is not sufficient to determine the 
reasonableness of price.’’. 
(e) CONFORMING AMENDMENT
TO TRUTH
IN NEGOTIATIONS 
ACT.—Section 2306a(d)(1) of title 10, United States Code, is 
amended by adding at the end the following new sentence: ‘‘If 
the contracting officer determines that the offeror does not have 
access to and cannot provide sufficient information on prices for 
the same or similar items to determine the reasonableness of price, 
the contracting officer shall require the submission of information 
on prices for similar levels of work or effort on related products 
or services, prices for alternative solutions or approaches, and other 
information that is relevant to the determination of a fair and 
reasonable price.’’.
H. R. 1735—194 
SEC. 853. USE OF RECENT PRICES PAID BY THE GOVERNMENT IN 
THE DETERMINATION OF PRICE REASONABLENESS. 
Section 2306a(b) of title 10, United States Code, as amended 
by section 851, is further amended by adding at the end the fol-
lowing new paragraph: 
‘‘(5) A contracting officer shall consider evidence provided 
by an offeror of recent purchase prices paid by the Government 
for the same or similar commercial items in establishing price 
reasonableness on a subsequent purchase if the contracting 
officer is satisfied that the prices previously paid remain a 
valid reference for comparison after considering the totality 
of other relevant factors such as the time elapsed since the 
prior purchase and any differences in the quantities purchased 
or applicable terms and conditions.’’. 
SEC. 854. REPORT ON DEFENSE-UNIQUE LAWS APPLICABLE TO THE 
PROCUREMENT OF COMMERCIAL ITEMS AND COMMER-
CIALLY AVAILABLE OFF-THE-SHELF ITEMS. 
(a) REPORT REQUIRED.—The Secretary of Defense shall submit 
to the congressional defense committees a report identifying the 
defense-unique provisions of law that are applicable for procurement 
of commercial items or commercial off-the-shelf items, both at the 
prime contract and subcontract level. The report— 
(1) shall discuss the impact— 
(A) of limiting the inclusion of clauses in contracts 
for commercial items or commercial off-the-shelf items to 
those that are required to implement law or Executive 
orders or are determined to be consistent with standard 
commercial practice; and 
(B) of limiting flow down of clauses in subcontracts 
for commercial items or commercial off the shelf-items to 
those that are required to implement law or Executive 
order; and 
(2) shall provide a listing of all standard clauses used 
in Federal Acquisition Regulation Part 12 contracts, including 
a justification for the inclusion of each. 
(b) DEADLINE FOR SUBMISSION.—The report under subsection 
(a) shall be submitted not later than 180 days after the date 
of the enactment of this Act. 
SEC. 855. MARKET RESEARCH AND PREFERENCE FOR COMMERCIAL 
ITEMS. 
(a) GUIDANCE REQUIRED.—Not later than 90 days after the 
date of the enactment of this Act, the Under Secretary of Defense 
for Acquisition, Technology, and Logistics shall issue guidance to 
ensure that acquisition officials of the Department of Defense fully 
comply with the requirements of section 2377 of title 10, United 
States Code, regarding market research and commercial items. 
The guidance issued pursuant to this subsection shall, at a min-
imum— 
(1) provide that the head of an agency may not enter 
into a contract in excess of the simplified acquisition threshold 
for information technology products or services that are not 
commercial items unless the head of the agency determines 
in writing that no commercial items are suitable to meet the 
agency’s needs as provided in subsection (c)(2) of such section; 
and
H. R. 1735—195 
(2) ensure that market research conducted in accordance 
with subsection (c) of such section is used, where appropriate, 
to inform price reasonableness determinations. 
(b) REVIEW REQUIRED.—Not later than 180 days after the date 
of the enactment of this Act, the Chairman and the Vice Chairman 
of the Joint Chiefs of Staff, in consultation with the Under Secretary 
of Defense for Acquisition, Technology, and Logistics, shall review 
Chairman of the Joint Chiefs of Staff Instruction 3170.01, the 
Manual for the Operation of the Joint Capabilities Integration 
and Development System, and other documents governing the 
requirements development process and revise these documents as 
necessary to ensure that the Department of Defense fully complies 
with the requirement in section 2377(c) of title 10, United States 
Code, and section 10.001 of the Federal Acquisition Regulation 
for Federal agencies to conduct appropriate market research before 
developing new requirements. 
(c) MARKET RESEARCH DEFINED.—For the purposes of this sec-
tion, the term ‘‘market research’’ means a review of existing sys-
tems, subsystems, capabilities, and technologies that are available 
or could be made available to meet the needs of the Department 
of Defense in whole or in part. The review may include any of 
the techniques for conducting market research provided in section 
10.002(b)(2) of the Federal Acquisition Regulation and shall include, 
at a minimum, contacting knowledgeable individuals in Government 
and industry regarding existing market capabilities. 
SEC. 856. LIMITATION ON CONVERSION OF PROCUREMENTS FROM 
COMMERCIAL ACQUISITION PROCEDURES. 
(a) LIMITATION.— 
(1) IN GENERAL.—Except as provided in paragraph (2), prior 
to converting the procurement of commercial items or services 
valued at more than $1,000,000 from commercial acquisition 
procedures under part 12 of the Federal Acquisition Regulation 
to noncommercial acquisition procedures under part 15 of the 
Federal Acquisition Regulation, the contracting officer for the 
procurement shall determine in writing that— 
(A) the earlier use of commercial acquisition procedures 
under part 12 of the Federal Acquisition Regulation was 
in error or based on inadequate information; and 
(B) the Department of Defense will realize a cost 
savings compared to the cost of procuring a similar quantity 
or level of such item or service using commercial acquisition 
procedures. 
(2) REQUIREMENT
FOR
APPROVAL
OF
DETERMINATION
BY 
HEAD OF CONTRACTING ACTIVITY.—In the case of a procurement 
valued at more than $100,000,000, a contract may not be 
awarded pursuant to a conversion of the procurement described 
in paragraph (1) until— 
(A) the head of the contracting activity approves the 
determination made under paragraph (1); and 
(B) a copy of the determination so approved is provided 
to the Office of the Under Secretary of Defense for Acquisi-
tion, Technology, and Logistics. 
(b) FACTORS TO BE CONSIDERED.—In making a determination 
under paragraph (1), the determining official shall, at a minimum, 
consider the following factors:
H. R. 1735—196 
(1) The estimated cost of research and development to 
be performed by the existing contractor to improve future prod-
ucts or services. 
(2) The transaction costs for the Department of Defense 
and the contractor in assessing and responding to data requests 
to support a conversion to noncommercial acquisition proce-
dures. 
(3) Changes in purchase quantities. 
(4) Costs associated with potential procurement delays 
resulting from the conversion. 
(c) PROCEDURES.—Not later than 180 days after the date of 
the enactment of this Act, the Secretary of Defense shall develop 
procedures to track conversions of future contracts and subcontracts 
for improved analysis and reporting and shall revise the Defense 
Federal Acquisition Regulation Supplement to reflect the require-
ment in subsection (a). 
(d) REPORTING REQUIREMENT.—Not later than one year after 
the date of the enactment of this Act, the Secretary of Defense 
shall submit to the congressional defense committees a report on 
the implementation of subsection (a), including any procurements 
converted as described in that subsection. 
(e) SUNSET.—The requirements of this section shall terminate 
5 years after the date of the enactment of this Act. 
SEC. 857. TREATMENT OF GOODS AND SERVICES PROVIDED BY NON-
TRADITIONAL DEFENSE CONTRACTORS AS COMMERCIAL 
ITEMS. 
(a) IN GENERAL.—Chapter 140 of title 10, United States Code, 
as amended by section 851, is further amended by adding at the 
end the following new section: 
‘‘§ 2380A. Treatment of goods and services provided by non-
traditional defense contractors as commercial 
items 
‘‘Notwithstanding section 2376(1) of this title, items and serv-
ices provided by nontraditional defense contractors (as that term 
is defined in section 2302(9) of this title) may be treated by the 
head of an agency as commercial items for purposes of this 
chapter.’’. 
(b) CLERICAL AMENDMENT.—The table of sections at the begin-
ning of chapter 140 of such title is amended by inserting after 
the item relating to section 2380, as added by section 851, the 
following new item: 
‘‘2380A. Treatment of goods and services provided by nontraditional defense contrac-
tors as commercial items.’’. 
Subtitle F—Industrial Base Matters 
SEC. 861. AMENDMENT TO MENTOR-PROTEGE PROGRAM. 
(a) IN
GENERAL.—Section 831 of the National Defense 
Authorization Act for Fiscal Year 1991 (Public Law 101–510; 104 
Stat. 1607; 10 U.S.C. 2302 note) is amended— 
(1) in subsection (b), by striking ‘‘designed to enhance’’ 
and all that follows through the period at the end and inserting 
the following: ‘‘designed to—
H. R. 1735—197 
‘‘(1) enhance the capabilities of disadvantaged small business 
concerns to perform as subcontractors and suppliers under Depart-
ment of Defense contracts and other contracts and subcontracts; 
and 
‘‘(2) increase the participation of such business concerns as 
subcontractors and suppliers under Department of Defense con-
tracts, other Federal Government contracts, and commercial con-
tracts.’’; 
(2) in subsection (c)(2), by striking ‘‘to receive such assist-
ance at any time’’ and inserting ‘‘concurrently, and the authority 
to enter into agreements under subsection (e) shall only be 
available to such concern during the 5-year period beginning 
on the date such concern enters into the first such agreement’’; 
(3) in subsection (d)— 
(A) by redesignating paragraphs (1) and (2) as clauses 
(i) and (ii), respectively (and conforming the margins 
accordingly); and 
(B) by inserting before clause (i) (as so redesignated) 
the following: 
‘‘(1) the mentor firm is not affiliated with the protege 
firm prior to the approval of that agreement; and 
‘‘(2) the mentor firm demonstrates that it— 
‘‘(A) is qualified to provide assistance that will con-
tribute to the purpose of the program; 
‘‘(B) is of good financial health and character and does 
not appear on a Federal list of debarred or suspended 
contractors; and 
‘‘(C) can impart value to a protege firm because of 
experience gained as a Department of Defense contractor 
or through knowledge of general business operations and 
government contracting, as demonstrated by evidence 
that—’’; 
(4) by amending subsection (e)(1) to read as follows: 
‘‘(1) A developmental program for the protege firm, in such 
detail as may be reasonable, including— 
‘‘(A) factors to assess the protege firm’s developmental 
progress under the program; 
‘‘(B) a description of the quantitative and qualitative 
benefits to the Department of Defense from the agreement, 
if applicable; and 
‘‘(C) goals for additional awards that protege firm can 
compete for outside the Mentor-Protege Program.’’; 
(5) in subsection (f)— 
(A) in paragraph (1)(A), by striking ‘‘business develop-
ment,’’; 
(B) by striking paragraph (6); and 
(C) by redesignating paragraph (7) as paragraph (6); 
(6) in subsection (g)— 
(A) in paragraph (2)— 
(i) in subparagraph (A), by striking ‘‘paragraphs 
(1) and (7) of subsection (f)’’ and inserting ‘‘paragraphs 
(1) and (6) of subsection (f) (except as provided in 
subparagraph (D))’’; 
(ii) in subparagraph (B), by striking ‘‘under sub-
section (l)(2)’’; and 
(iii) by adding at the end the following new 
subparagraph:
H. R. 1735—198 
‘‘(D) The Secretary may not reimburse any fee assessed 
by the mentor firm for services provided to the protege firm 
pursuant to subsection (f)(6) or for business development 
expenses incurred by the mentor firm under a contract awarded 
to the mentor firm while participating in a joint venture with 
the protege firm.’’; and 
(B) in paragraph (3)(B)(i), by striking ‘‘subsection (f)(7)’’ 
and inserting ‘‘subsection (f)(6)’’; 
(7) in subsection (h)(1), by inserting ‘‘(15 U.S.C. 631 et 
seq.)’’ after ‘‘Small Business Act’’; 
(8) in subsection (j)— 
(A) in paragraph (1), by striking ‘‘September 30, 2015’’ 
and inserting ‘‘September 30, 2018’’; and 
(B) in paragraph (2), by striking ‘‘September 30, 2018’’ 
and inserting ‘‘September 30, 2021’’; 
(9) by redesignating subsection (l) as subsection (n); 
(10) by inserting after subsection (k) the following new 
subsections: 
‘‘(l) REPORT BY MENTOR FIRMS.—To comply with section 8(d)(7) 
of the Small Business Act (15 U.S.C. 637(d)(7)), each mentor firm 
shall submit a report to the Secretary not less than once each 
fiscal year that includes, for the preceding fiscal year— 
‘‘(1) all technical or management assistance provided by 
mentor firm personnel for the purposes described in subsection 
(f)(1); 
‘‘(2) any new awards of subcontracts on a competitive or 
noncompetitive basis to the protege firm under Department 
of Defense contracts or other contracts, including the value 
of such subcontracts; 
‘‘(3) any extensions, increases in the scope of work, or 
additional payments not previously reported for prior awards 
of subcontracts on a competitive or noncompetitive basis to 
the protege firm under Department of Defense contracts or 
other contracts, including the value of such subcontracts; 
‘‘(4) the amount of any payment of progress payments 
or advance payments made to the protege firm for performance 
under any subcontract made under the Mentor-Protege Pro-
gram; 
‘‘(5) any loans made by mentor firm to the protege firm; 
‘‘(6) all Federal contracts awarded to the mentor firm and 
the protege firm as a joint venture, designating whether the 
award was a restricted competition or a full and open competi-
tion; 
‘‘(7) any assistance obtained by the mentor firm for the 
protege firm from one or more— 
‘‘(A) small business development centers established 
pursuant to section 21 of the Small Business Act (15 U.S.C. 
648); 
‘‘(B) entities providing procurement technical assist-
ance pursuant to chapter 142 of title 10, United States 
Code; or 
‘‘(C) historically Black colleges or universities or 
minority institutions of higher education; 
‘‘(8) whether there have been any changes to the terms 
of the mentor-protege agreement; and 
‘‘(9) a narrative describing the success assistance provided 
under subsection (f) has had in addressing the developmental
H. R. 1735—199 
needs of the protege firm, the impact on Department of Defense 
contracts, and addressing any problems encountered. 
‘‘(m) REVIEW OF REPORT BY THE OFFICE OF SMALL BUSINESS 
PROGRAMS.—The Office of Small Business Programs of the Depart-
ment of Defense shall review the report required by subsection 
(l) and, if the Office finds that the mentor-protege agreement is 
not furthering the purpose of the Mentor-Protege Program, decide 
not to approve any continuation of the agreement.’’; and 
(11) in subsection (n) (as so redesignated)— 
(A) in paragraph (1), by striking ‘‘means a business 
concern that meets the requirements of section 3(a) of 
the Small Business Act (15 U.S.C. 632(a)) and the regula-
tions promulgated pursuant thereto’’ and inserting ‘‘has 
the meaning given such term under section 3 of the Small 
Business Act (15 U.S.C. 632)’’; 
(B) in paragraph (2)— 
(i) by striking ‘‘means:’’ and inserting ‘‘means a 
firm that has less than half the size standard cor-
responding to its primary North American Industry 
Classification System code, is not owned or managed 
by individuals or entities that directly or indirectly 
have stock options or convertible securities in the 
mentor firm, and is—’’; 
(ii) in subparagraph (D), by striking ‘‘the severely 
disabled’’ and inserting ‘‘severely disabled individuals’’; 
(iii) in subparagraph (G), by striking ‘‘Small Busi-
ness Act.’’ and inserting ‘‘Small Business Act (15 U.S.C. 
632(p)); or’’; and 
(iv) by adding at the end the following new 
subparagraph: 
‘‘(H) a small business concern that— 
‘‘(i) is a nontraditional defense contractor, as such 
term is defined in section 2302 of title 10, United 
States Code; or 
‘‘(ii) currently provides goods or services in the 
private sector that are critical to enhancing the 
capabilities of the defense supplier base and fulfilling 
key Department of Defense needs.’’; 
(C) by amending paragraph (8) to read as follows: 
‘‘(8) The term ‘severely disabled individual’ means an indi-
vidual who is blind (as defined in section 8501 of title 41, 
United States Code) or a severely disabled individual (as 
defined in such section).’’; and 
(D) by adding at the end the following new paragraph: 
‘‘(9) The term ‘affiliated’, with respect to the relationship 
between a mentor firm and a protege firm, means— 
‘‘(A) the mentor firm shares, directly or indirectly, with 
the protege firm ownership or management of the protege 
firm; 
‘‘(B) the mentor firm has an agreement, at the time 
the mentor firm enters into a mentor-protege agreement 
under subsection (e), to merge with the protege firm; 
‘‘(C) the owners and managers of the mentor firm 
are the parent, child, spouse, sibling, aunt, uncle, niece, 
nephew, grandparent, grandchild, or first cousin of an 
owner or manager of the protege firm;
H. R. 1735—200 
‘‘(D) the mentor firm has, during the 2-year period 
before entering into a mentor-protege agreement, employed 
any officer, director, principal stock holder, managing 
member, or key employee of the protege firm; 
‘‘(E) the mentor firm has engaged in a joint venture 
with the protege firm during the 2-year period before 
entering into a mentor-protege agreement, unless such joint 
venture was approved by the Small Business Administra-
tion prior to making any offer on a contract; 
‘‘(F) the mentor firm is, directly or indirectly, the pri-
mary party providing contracts to the protege firm, as 
measured by the dollar value of the contracts; and 
‘‘(G) the Small Business Administration has made a 
determination of affiliation or control under subsection 
(h).’’. 
(b) APPLICATION.— 
(1) IN
GENERAL.—The amendments made by subsection 
(a) shall apply to a mentor-protege agreement made pursuant 
to section 831 of the National Defense Authorization Act for 
Fiscal Year 1991 (Public Law 101–510; 104 Stat. 1607; 10 
U.S.C. 2302 note) entered into after the date of the enactment 
of the National Defense Authorization Act for Fiscal Year 2016. 
(2) RETROACTIVITY
OF
REPORT
AND
REVIEW
REQUIRE-
MENTS.—The amendments made by subsection (a)(10) shall 
apply to a mentor-protege agreement made pursuant to section 
831 of the National Defense Authorization Act for Fiscal Year 
1991 (Public Law 101–510; 104 Stat. 1607; 10 U.S.C. 2302 
note) entered into before, on, or after the date of the enactment 
of the National Defense Authorization Act for Fiscal Year 2016. 
SEC. 862. AMENDMENTS TO DATA QUALITY IMPROVEMENT PLAN. 
(a) IN GENERAL.—Section 15(s) of the Small Business Act (15 
U.S.C. 644(s)) is amended— 
(1) by redesignating paragraph (4) as paragraph (6); and 
(2) by inserting after paragraph (3) the following new para-
graphs: 
‘‘(4) IMPLEMENTATION.—Not later than October 1, 2016, 
the Administrator of the Small Business Administration shall 
implement the plan described in this subsection. 
‘‘(5) CERTIFICATION.—The Administrator shall annually pro-
vide to the Committee on Small Business of the House of 
Representatives and the Committee on Small Business and 
Entrepreneurship of the Senate a certification of the accuracy 
and completeness of data reported on bundled and consolidated 
contracts.’’. 
(b) GAO STUDY.— 
(1) STUDY.—Not later than October 1, 2017, the Comp-
troller General of the United States shall initiate a study on 
the effectiveness of the plan described in section 15(s) of the 
Small Business Act (15 U.S.C. 644(s)) that shall assess whether 
contracts were accurately labeled as bundled or consolidated. 
(2) CONTRACTS EVALUATED.—For the purposes of conducting 
the study described in paragraph (1), the Comptroller General 
of the United States— 
(A) shall evaluate, for work in each of sectors 23, 
33, 54, and 56 (as defined by the North American Industry
H. R. 1735—201 
Classification System), not fewer than 100 contracts in 
each sector; 
(B) shall evaluate only those contracts— 
(i) awarded by an agency listed in section 901(b) 
of title 31, United States Code; and 
(ii) that have a Base and Exercised Options Value, 
an Action Obligation, or a Base and All Options Value 
(as such terms are defined in the Federal Procurement 
Data System described in section 1122(a)(4)(A) of title 
41, United States Code, or any successor system); and 
(C) shall not evaluate contracts that have used any 
set-aside authority. 
(3) REPORT.—Not later than 12 months after initiating 
the study required by paragraph (1), the Comptroller General 
of the United States shall report to the Committee on Small 
Business of the House of Representatives and the Committee 
on Small Business and Entrepreneurship of the Senate on 
the results from such study and, if warranted, any recommenda-
tions on how to improve the quality of data reported on bundled 
and consolidated contracts. 
SEC. 863. NOTICE OF CONTRACT CONSOLIDATION FOR ACQUISITION 
STRATEGIES. 
(a) NOTICE REQUIREMENT FOR THE HEAD OF A CONTRACTING 
AGENCY.—Section 15(e)(3) of the Small Business Act (15 U.S.C. 
644(e)(3)) is amended to read as follows: 
‘‘(3) STRATEGY SPECIFICATIONS.—If the head of a contracting 
agency determines that an acquisition plan for a procurement 
involves a substantial bundling of contract requirements, the 
head of a contracting agency shall publish a notice on a public 
website that such determination has been made not later than 
7 days after making such determination. Any solicitation for 
a procurement related to the acquisition plan may not be pub-
lished earlier than 7 days after such notice is published. Along 
with the publication of the solicitation, the head of a contracting 
agency shall publish a justification for the determination, which 
shall include the following information: 
‘‘(A) The specific benefits anticipated to be derived 
from the bundling of contract requirements and a deter-
mination that such benefits justify the bundling. 
‘‘(B) An identification of any alternative contracting 
approaches that would involve a lesser degree of bundling 
of contract requirements. 
‘‘(C) An assessment of— 
‘‘(i) the specific impediments to participation by 
small business concerns as prime contractors that 
result from the bundling of contract requirements; and 
‘‘(ii) the specific actions designed to maximize 
participation of small business concerns as subcontrac-
tors (including suppliers) at various tiers under the 
contract or contracts that are awarded to meet the 
requirements.’’. 
(b) NOTICE
REQUIREMENT
FOR
THE
SENIOR
PROCUREMENT 
EXECUTIVE
OR CHIEF ACQUISITION OFFICER.—Section 44(c)(2) of 
the Small Business Act (15 U.S.C. 657q(c)(2)) is amended by adding 
at the end the following:
H. R. 1735—202 
‘‘(C) NOTICE.—Not later than 7 days after making a 
determination that an acquisition strategy involving a 
consolidation of contract requirements is necessary and 
justified under subparagraph (A), the senior procurement 
executive or Chief Acquisition Officer shall publish a notice 
on a public website that such determination has been made. 
Any solicitation for a procurement related to the acquisition 
strategy may not be published earlier than 7 days after 
such notice is published. Along with the publication of 
the solicitation, the senior procurement executive or Chief 
Acquisition Officer shall publish a justification for the 
determination, which shall include the information in sub-
paragraphs (A) through (E) of paragraph (1).’’. 
(c) TECHNICAL AMENDMENT.—Section 44(c)(1) of the Small Busi-
ness Act (15 U.S.C. 657q(c)(1)) is amended by striking ‘‘Subject 
to paragraph (4), the head’’ and inserting ‘‘The head’’. 
SEC. 864. CLARIFICATION OF REQUIREMENTS RELATED TO SMALL 
BUSINESS CONTRACTS FOR SERVICES. 
(a) PROCUREMENT CONTRACTS.—Section 8(a)(17) of the Small 
Business Act (15 U.S.C. 637(a)(17)) is amended— 
(1) in subparagraph (A), by striking ‘‘any procurement con-
tract’’ and all that follows through ‘‘section 15’’ and inserting 
‘‘any procurement contract, which contract has as its principal 
purpose the supply of a product to be let pursuant to this 
subsection, subsection (m), section 15(a), section 31, or section 
36,’’; and 
(2) by adding at the end the following new subparagraph: 
‘‘(C) LIMITATION.—This paragraph shall not apply to a con-
tract that has as its principal purpose the acquisition of services 
or construction.’’. 
(b) SUBCONTRACTOR CONTRACTS.—Section 46(a)(4) of the Small 
Business Act (15 U.S.C. 657s(a)(4)) is amended by striking ‘‘for 
supplies from a regular dealer in such supplies’’ and inserting 
‘‘which is principally for supplies from a regular dealer in such 
supplies, and which is not a contract principally for services or 
construction’’. 
SEC. 865. CERTIFICATION REQUIREMENTS FOR BUSINESS OPPOR-
TUNITY SPECIALISTS, COMMERCIAL MARKET REPRESENT-
ATIVES, AND PROCUREMENT CENTER REPRESENTATIVES. 
(a) BUSINESS OPPORTUNITY SPECIALIST REQUIREMENTS.— 
(1) IN GENERAL.—Section 4 of the Small Business Act (15 
U.S.C. 633) is amended by adding at the end the following 
new subsection: 
‘‘(g) CERTIFICATION REQUIREMENTS FOR BUSINESS OPPORTUNITY 
SPECIALISTS.— 
‘‘(1) IN
GENERAL.—Consistent with the requirements of 
paragraph (2), a Business Opportunity Specialist described 
under section 7(j)(10)(D) shall have a Level I Federal Acquisi-
tion Certification in Contracting (or any successor certification) 
or the equivalent Department of Defense certification, except 
that a Business Opportunity Specialist who was serving on 
or before January 3, 2013, may continue to serve as a Business 
Opportunity Specialist for a period of 5 years beginning on 
such date without such a certification. 
‘‘(2) DELAY OF CERTIFICATION REQUIREMENT.—
H. R. 1735—203 
‘‘(A) TIMING.—The certification described in paragraph 
(1) is not required for any person serving as a Business 
Opportunity Specialist until the date that is one calendar 
year after the date such person is appointed as a Business 
Opportunity Specialist. 
‘‘(B) APPLICATION.—The requirements of subparagraph 
(A) shall— 
‘‘(i) be included in any initial job posting for the 
position of a Business Opportunity Specialist; and 
‘‘(ii) apply to any person appointed as a Business 
Opportunity Specialist after January 3, 2013.’’. 
(2) CONFORMING AMENDMENT.—Section 7(j)(10)(D)(i) of such 
Act (15 U.S.C. 636(j)(10)(D)(i)) is amended by striking the 
second sentence. 
(b) COMMERCIAL MARKET REPRESENTATIVE REQUIREMENTS.— 
Section 4 of the Small Business Act (15 U.S.C. 633), as amended 
by subsection (a)(1), is further amended by adding at the end 
the following new subsection: 
‘‘(h) CERTIFICATION REQUIREMENTS FOR COMMERCIAL MARKET 
REPRESENTATIVES.— 
‘‘(1) IN
GENERAL.—Consistent with the requirements of 
paragraph (2), a commercial market representative referred 
to in section 15(q)(3) shall have a Level I Federal Acquisition 
Certification in Contracting (or any successor certification) or 
the equivalent Department of Defense certification, except that 
a commercial market representative who was serving on or 
before the date of the enactment of the National Defense 
Authorization Act for Fiscal Year 2016 may continue to serve 
as a commercial market representative for a period of 5 years 
beginning on such date without such a certification. 
‘‘(2) DELAY OF CERTIFICATION REQUIREMENT.— 
‘‘(A) TIMING.—The certification described in paragraph 
(1) is not required for any person serving as a commercial 
market representative until the date that is one calendar 
year after the date such person is appointed as a commer-
cial market representative. 
‘‘(B) APPLICATION.—The requirements of subparagraph 
(A) shall— 
‘‘(i) be included in any initial job posting for the 
position of a commercial market representative; and 
‘‘(ii) apply to any person appointed as a commercial 
market representative after the date of the enactment 
of the National Defense Authorization Act for Fiscal 
Year 2016.’’. 
(c) PROCUREMENT CENTER REPRESENTATIVE REQUIREMENTS.— 
Section 15(l)(5) of the Small Business Act (15 U.S.C. 644(l)(5)) 
is amended— 
(1) in subparagraph (A), by amending clause (iii) to read 
as follows: 
‘‘(iii) have the certification described in subpara-
graph (C).’’; and 
(2) by adding at the end the following new subparagraph: 
‘‘(C) CERTIFICATION REQUIREMENTS.— 
‘‘(i) IN
GENERAL.—Consistent with the require-
ments of clause (ii), a procurement center representa-
tive shall have a Level III Federal Acquisition Certifi-
cation in Contracting (or any successor certification)
H. R. 1735—207 
Emergency Assistance Act (42 U.S.C. 5170) or a catastrophic 
incident that occurs on or after the date of enactment of such 
subsection. 
(c) INCLUDING FEMA IN AGENCIES THAT MAY PROVIDE DATA 
FOR HUBZONE PROGRAM.—Section 31(c)(3) of the Small Business 
Act (15 U.S.C. 657a(c)(3)) is amended by inserting ‘‘the Adminis-
trator of the Federal Emergency Management Agency,’’ after ‘‘the 
Secretary of Labor,’’. 
(d) GAO STUDY
OF IMPROVEMENT
TO OVERSIGHT
OF
THE 
HUBZONE PROGRAM.—Not later than 120 days after the date of 
enactment of this Act, the Comptroller General of the United States 
shall complete a study on and submit a report to the Committee 
on Small Business of the House of Representatives and the Com-
mittee on Small Business and Entrepreneurship of the Senate that 
includes— 
(1) an assessment of the evaluation process, including any 
weaknesses in the process, used by the Small Business Adminis-
tration to approve or deny participation in the HUBZone pro-
gram established under section 31 of the Small Business Act 
(15 U.S.C. 657a); 
(2) an assessment of the oversight of HUBZone program 
participants by the Small Business Administration, including 
Administration actions taken to prevent fraud, waste, and 
abuse; and 
(3) recommendations on how to improve the evaluation 
process and oversight mechanisms to further reduce fraud, 
waste, and abuse. 
SEC. 867. JOINT VENTURING AND TEAMING. 
(a) JOINT VENTURE OFFERS FOR BUNDLED OR CONSOLIDATED 
CONTRACTS.—Section 15(e)(4) of the Small Business Act (15 U.S.C. 
644(e)(4)) is amended to read as follows: 
‘‘(4) CONTRACT TEAMING.— 
‘‘(A) IN GENERAL.—In the case of a solicitation of offers 
for a bundled or consolidated contract that is issued by 
the head of an agency, a small business concern that pro-
vides for use of a particular team of subcontractors or 
a joint venture of small business concerns may submit 
an offer for the performance of the contract. 
‘‘(B) EVALUATION OF OFFERS.—The head of the agency 
shall evaluate an offer described in subparagraph (A) in 
the same manner as other offers, with due consideration 
to the capabilities of all of the proposed subcontractors 
or members of the joint venture as follows: 
‘‘(i) TEAMS.—When evaluating an offer of a small 
business prime contractor that includes a proposed 
team of small business subcontractors, the head of 
the agency shall consider the capabilities and past 
performance of each first tier subcontractor that is 
part of the team as the capabilities and past perform-
ance of the small business prime contractor. 
‘‘(ii) JOINT VENTURES.—When evaluating an offer 
of a joint venture of small business concerns, if the 
joint venture does not demonstrate sufficient capabili-
ties or past performance to be considered for award 
of a contract opportunity, the head of the agency shall 
consider the capabilities and past performance of each
H. R. 1735—208 
member of the joint venture as the capabilities and 
past performance of the joint venture. 
‘‘(C) STATUS AS A SMALL BUSINESS CONCERN.—Partici-
pation of a small business concern in a team or a joint 
venture under this paragraph shall not affect the status 
of that concern as a small business concern for any other 
purpose.’’. 
(b) TEAM AND JOINT VENTURES OFFERS FOR MULTIPLE AWARD 
CONTRACTS.—Section 15(q)(1) of such Act (15 U.S.C. 644(q)(1)) is 
amended— 
(1) in the heading, by inserting ‘‘AND JOINT VENTURE’’ before 
‘‘REQUIREMENTS’’; 
(2) by striking ‘‘Each Federal agency’’ and inserting the 
following: 
‘‘(A) IN GENERAL.—Each Federal agency’’; and 
(3) by adding at the end the following new subparagraphs: 
‘‘(B) TEAMS.—When evaluating an offer of a small busi-
ness prime contractor that includes a proposed team of 
small business subcontractors for any multiple award con-
tract above the substantial bundling threshold of the Fed-
eral agency, the head of the agency shall consider the 
capabilities and past performance of each first tier subcon-
tractor that is part of the team as the capabilities and 
past performance of the small business prime contractor. 
‘‘(C) JOINT VENTURES.—When evaluating an offer of 
a joint venture of small business concerns for any multiple 
award contract above the substantial bundling threshold 
of the Federal agency, if the joint venture does not dem-
onstrate sufficient capabilities or past performance to be 
considered for award of a contract opportunity, the head 
of the agency shall consider the capabilities and past 
performance of each member of the joint venture as the 
capabilities and past performance of the joint venture.’’. 
SEC. 868. MODIFICATION TO AND SCORECARD PROGRAM FOR SMALL 
BUSINESS CONTRACTING GOALS. 
(a) AMENDMENT TO GOVERNMENTWIDE GOAL FOR SMALL BUSI-
NESS
PARTICIPATION
IN
PROCUREMENT
CONTRACTS.—Section 
15(g)(1)(A)(i) of the Small Business Act (15 U.S.C. 644(g)(1)(A)(i)) 
is amended by adding at the end the following: ‘‘In meeting this 
goal, the Government shall ensure the participation of small busi-
ness concerns from a wide variety of industries and from a broad 
spectrum of small business concerns within each industry.’’. 
(b) SCORECARD PROGRAM FOR EVALUATING FEDERAL AGENCY 
COMPLIANCE WITH SMALL BUSINESS CONTRACTING GOALS.— 
(1) IN GENERAL.—Not later than September 30, 2016, the 
Administrator of the Small Business Administration, in con-
sultation with the Federal agencies, shall— 
(A) develop a methodology for calculating a score to 
be used to evaluate the compliance of each Federal agency 
with meeting the goals established pursuant to section 
15(g)(1)(B) 
of 
the 
Small 
Business 
Act 
(15 
U.S.C. 
644(g)(1)(B)) based on each such goal; and 
(B) develop a scorecard based on such methodology. 
(2) USE
OF
SCORECARD.—Beginning in fiscal year 2017, 
the Administrator shall establish and carry out a program 
to use the scorecard developed under paragraph (1) to evaluate
H. R. 1735—209 
whether each Federal agency is creating the maximum prac-
ticable opportunities for the award of prime contracts and sub-
contracts to small business concerns, small business concerns 
owned and controlled by service-disabled veterans, qualified 
HUBZone small business concerns, small business concerns 
owned and controlled by socially and economically disadvan-
taged individuals, and small business concerns owned and con-
trolled by women, by assigning a score to each Federal agency 
for the previous fiscal year. 
(3) CONTENTS
OF
SCORECARD.—The scorecard developed 
under paragraph (1) shall include, for each Federal agency, 
the following information: 
(A) A determination of whether the Federal agency 
met each of the prime contract goals established pursuant 
to section 15(g)(1)(B) of the Small Business Act (15 U.S.C. 
644(g)(1)(B)) with respect to small business concerns, small 
business concerns owned and controlled by service-disabled 
veterans, qualified HUBZone small business concerns, 
small business concerns owned and controlled by socially 
and economically disadvantaged individuals, and small 
business concerns owned and controlled by women. 
(B) A determination of whether the Federal agency 
met each of the subcontract goals established pursuant 
to such section with respect to small business concerns, 
small business concerns owned and controlled by service- 
disabled veterans, qualified HUBZone small business con-
cerns, small business concerns owned and controlled by 
socially and economically disadvantaged individuals, and 
small business concerns owned and controlled by women. 
(C) The number of small business concerns, small busi-
ness concerns owned and controlled by service-disabled vet-
erans, qualified HUBZone small business concerns, small 
business concerns owned and controlled by socially and 
economically disadvantaged individuals, and small business 
concerns owned and controlled by women awarded prime 
contracts in each North American Industry Classification 
System code during the fiscal year and a comparison to 
the number of awarded contracts during the prior fiscal 
year, if available. 
(D) The number of small business concerns, small busi-
ness concerns owned and controlled by service-disabled vet-
erans, qualified HUBZone small business concerns, small 
business concerns owned and controlled by socially and 
economically disadvantaged individuals, and small business 
concerns owned and controlled by women awarded sub-
contracts in each North American Industry Classification 
System code during the fiscal year and a comparison to 
the number of awarded subcontracts during the prior fiscal 
year, if available. 
(E) Any other factors that the Administrator deems 
important to achieve the maximum practicable utilization 
of small business concerns, small business concerns owned 
and controlled by service-disabled veterans, qualified 
HUBZone small business concerns, small business concerns 
owned and controlled by socially and economically dis-
advantaged individuals, and small business concerns owned 
and controlled by women.
H. R. 1735—210 
(4) WEIGHTED FACTORS.—In using the scorecard to evaluate 
and assign a score to a Federal agency, the Administrator 
shall base— 
(A) fifty percent of the score on the dollar value of 
prime contracts described in paragraph (3)(A); and 
(B) fifty percent of the score on the information pro-
vided in subparagraphs (B) through (E) of paragraph (3), 
weighted in a manner determined by the Administrator 
to encourage the maximum practicable opportunity for the 
award of prime contracts and subcontracts to small busi-
ness concerns, small business concerns owned and con-
trolled by service-disabled veterans, qualified HUBZone 
small business concerns, small business concerns owned 
and controlled by socially and economically disadvantaged 
individuals, and small business concerns owned and con-
trolled by women. 
(5) PUBLICATION.—The scorecard used by the Administrator 
under this subsection shall be submitted to the President and 
Congress along with the report submitted under section 15(h)(2) 
of the Small Business Act (15 U.S.C. 644(h)(2)). 
(6) REPORT.—After the Administrator uses the scorecard 
for fiscal year 2018 to assign scores to Federal agencies, but 
not later than March 31, 2019, the Administrator shall submit 
a report to the Committee on Small Business of the House 
of Representatives and the Committee on Small Business and 
Entrepreneurship of the Senate. Such report shall include the 
following: 
(A) A description of any increase in the dollar amount 
of prime contracts and subcontracts awarded to small busi-
ness concerns, small business concerns owned and con-
trolled by service-disabled veterans, qualified HUBZone 
small business concerns, small business concerns owned 
and controlled by socially and economically disadvantaged 
individuals, and small business concerns owned and con-
trolled by women. 
(B) A description of any increase in the dollar amount 
of prime contracts and subcontracts, and the total number 
of contracts, awarded to small business concerns, small 
business concerns owned and controlled by service-disabled 
veterans, qualified HUBZone small business concerns, 
small business concerns owned and controlled by socially 
and economically disadvantaged individuals, and small 
business concerns owned and controlled by women in each 
North American Industry Classification System code. 
(C) The recommendation of the Administrator on con-
tinuing, modifying, expanding, or terminating the program 
established under this subsection. 
(7) GAO REPORT ON SCORECARD METHODOLOGY.—Not later 
than September 30, 2018, the Comptroller General of the 
United States shall submit to the Committee on Small Business 
of the House of Representatives and the Committee on Small 
Business and Entrepreneurship of the Senate a report that— 
(A) evaluates whether the methodology used to cal-
culate a score under this subsection accurately and effec-
tively— 
(i) measures the compliance of each Federal agency 
with meeting the goals established pursuant to section
H. R. 1735—211 
15(g)(1)(B) of the Small Business Act (15 U.S.C. 
644(g)(1)(B)); and 
(ii) 
encourages 
Federal 
agencies 
to 
expand 
opportunities for small business concerns, small busi-
ness concerns owned and controlled by service-disabled 
veterans, qualified HUBZone small business concerns, 
small business concerns owned and controlled by 
socially and economically disadvantaged individuals, 
and small business concerns owned and controlled by 
women to compete for and be awarded Federal procure-
ment contracts across North American Industry Classi-
fication System codes; and 
(B) if warranted, makes recommendations on how to 
improve such methodology to improve its accuracy and 
effectiveness. 
(8) DEFINITIONS.—In this subsection: 
(A) ADMINISTRATOR.—The term ‘‘Administrator’’ means 
the Administrator of the Small Business Administration. 
(B) FEDERAL AGENCY.—The term ‘‘Federal agency’’ has 
the meaning given the term ‘‘agency’’ by section 551(1) 
of title 5, United States Code, but does not include the 
United States Postal Service or the Government Account-
ability Office. 
(C) SCORECARD.—The term ‘‘scorecard’’ shall mean any 
summary using a rating system to evaluate a Federal 
agency’s efforts to meet goals established under section 
15(g)(1)(B) 
of 
the 
Small 
Business 
Act 
(15 
U.S.C. 
644(g)(1)(B)) that— 
(i) includes the measures described in paragraph 
(3); and 
(ii) assigns a score to each Federal agency evalu-
ated. 
(D) SMALL BUSINESS ACT DEFINITIONS.— 
(i) IN GENERAL.—The terms ‘‘small business con-
cern’’, ‘‘small business concern owned and controlled 
by service-disabled veterans’’, ‘‘qualified HUBZone 
small business concern’’, and ‘‘small business concern 
owned and controlled by women’’ have the meanings 
given such terms under section 3 of the Small Business 
Act (15 U.S.C. 632). 
(ii) SMALL BUSINESS CONCERNS OWNED AND CON-
TROLLED BY SOCIALLY AND ECONOMICALLY DISADVAN-
TAGED INDIVIDUALS.—The term ‘‘small business concern 
owned and controlled by socially and economically dis-
advantaged individuals’’ has the meaning given that 
term under section 8(d)(3)(C) of the Small Business 
Act (15 U.S.C. 637(d)(3)(C)). 
SEC. 869. ESTABLISHMENT OF AN OFFICE OF HEARINGS AND APPEALS 
IN THE SMALL BUSINESS ADMINISTRATION; PETITIONS 
FOR RECONSIDERATION OF SIZE STANDARDS. 
(a) ESTABLISHMENT OF AN OFFICE OF HEARINGS AND APPEALS 
IN THE SMALL BUSINESS ADMINISTRATION.— 
(1) IN GENERAL.—Section 5 of the Small Business Act (15 
U.S.C. 634) is amended by adding at the end the following 
new subsection: 
‘‘(i) OFFICE OF HEARINGS AND APPEALS.—
H. R. 1735—212 
‘‘(1) ESTABLISHMENT.— 
‘‘(A) OFFICE.—There is established in the Administra-
tion an Office of Hearings and Appeals— 
‘‘(i) to impartially decide matters relating to pro-
gram decisions of the Administrator— 
‘‘(I) for which Congress requires a hearing on 
the record; or 
‘‘(II) that the Administrator designates for 
hearing by regulation; and 
‘‘(ii) which shall contain the office of the Adminis-
tration that handles requests submitted pursuant to 
sections 552 of title 5, United States Code (commonly 
referred to as the ‘Freedom of Information Act’) and 
maintains records pursuant to section 552a of title 
5, United States Code (commonly referred to as the 
‘Privacy Act of 1974’). 
‘‘(B) JURISDICTION.—The Office of Hearings and 
Appeals shall only hear appeals of matters as described 
in this Act, the Small Business Investment Act of 1958 
(15 U.S.C. 661 et seq.), and title 13 of the Code of Federal 
Regulations. 
‘‘(C) ASSOCIATE
ADMINISTRATOR.—The head of the 
Office of Hearings and Appeals shall be the Chief Hearing 
Officer appointed under section 4(b)(1), who shall be respon-
sible to the Administrator. 
‘‘(2) CHIEF HEARING OFFICER DUTIES.— 
‘‘(A) IN GENERAL.—The Chief Hearing Officer shall— 
‘‘(i) be a career appointee in the Senior Executive 
Service and an attorney licensed by a State, common-
wealth, territory or possession of the United States, 
or the District of Columbia; and 
‘‘(ii) be responsible for the operation and manage-
ment of the Office of Hearings and Appeals. 
‘‘(B) ALTERNATIVE
DISPUTE
RESOLUTION.—The Chief 
Hearing Officer may assign a matter for mediation or other 
means of alternative dispute resolution. 
‘‘(3) HEARING OFFICERS.— 
‘‘(A) IN GENERAL.—The Office of Hearings and Appeals 
shall appoint Hearing Officers to carry out the duties 
described in paragraph (1)(A)(i). 
‘‘(B) CONDITIONS OF EMPLOYMENT.—A Hearing Officer 
appointed under this paragraph— 
‘‘(i) shall serve in the excepted service as an 
employee of the Administration under section 2103 
of title 5, United States Code, and under the super-
vision of the Chief Hearing Officer; 
‘‘(ii) shall be classified at a position to which section 
5376 of title 5, United States Code, applies; and 
‘‘(iii) shall be compensated at a rate not exceeding 
the maximum rate payable under such section. 
‘‘(C) AUTHORITY; POWERS.—Notwithstanding section 
556(b) of title 5, United States Code— 
‘‘(i) a Hearing Officer may hear cases arising under 
section 554 of such title; 
‘‘(ii) a Hearing Officer shall have the powers 
described in section 556(c) of such title; and
H. R. 1735—213 
‘‘(iii) the relevant provisions of subchapter II of 
chapter 5 of such title (except for section 556(b) of 
such title) shall apply to such Hearing Officer. 
‘‘(D) TREATMENT
OF
CURRENT
PERSONNEL.—An indi-
vidual serving as a Judge in the Office of Hearings and 
Appeals (as that position and office are designated in sec-
tion 134.101 of title 13, Code of Federal Regulations) on 
the effective date of this subsection shall be considered 
as qualified to be, and redesignated as, a Hearing Officer. 
‘‘(4) HEARING OFFICER DEFINED.—In this subsection, the 
term ‘Hearing Officer’ means an individual appointed or 
redesignated under this subsection who is an attorney licensed 
by a State, commonwealth, territory or possession of the United 
States, or the District of Columbia.’’. 
(2) ASSOCIATE ADMINISTRATOR AS CHIEF HEARING OFFICER.— 
Section 4(b)(1) of such Act (15 U.S.C. 633(b)) is amended by 
adding at the end the following: ‘‘One such Associate Adminis-
trator shall be the Chief Hearing Officer, who shall administer 
the Office of Hearings and Appeals established under section 
5(i).’’. 
(3) REPEAL OF REGULATION.—Section 134.102(t) of title 13, 
Code of Federal Regulations, as in effect on January 1, 2015 
(relating to types of hearings within the jurisdiction of the 
Office of Hearings and Appeals), shall have no force or effect. 
(b) PETITIONS FOR RECONSIDERATION OF SIZE STANDARDS FOR 
SMALL BUSINESS CONCERNS.—Section 3(a) of the Small Business 
Act (15 U.S.C. 632(a)) is amended by adding at the end the fol-
lowing: 
‘‘(9) PETITIONS FOR RECONSIDERATION OF SIZE STANDARDS.— 
‘‘(A) IN GENERAL.—A person may file a petition for 
reconsideration with the Office of Hearings and Appeals 
(as established under section 5(i)) of a size standard 
revised, modified, or established by the Administrator 
pursuant to this subsection. 
‘‘(B) TIME
LIMIT.—A person filing a petition for 
reconsideration described in subparagraph (A) shall file 
such petition not later than 30 days after the publication 
in the Federal Register of the notice of final rule to revise, 
modify, or establish size standards described in paragraph 
(6). 
‘‘(C) PROCESS
FOR
AGENCY
REVIEW.—The Office of 
Hearings and Appeals shall use the same process it uses 
to decide challenges to the size of a small business concern 
to decide a petition for review pursuant to this paragraph. 
‘‘(D) JUDICIAL REVIEW.—The publication of a final rule 
in the Federal Register described in subparagraph (B) shall 
be considered final agency action for purposes of seeking 
judicial review. Filing a petition for reconsideration under 
subparagraph (A) shall not be a condition precedent to 
judicial review of any such size standard.’’. 
SEC. 870. ADDITIONAL DUTIES OF THE DIRECTOR OF SMALL AND DIS-
ADVANTAGED BUSINESS UTILIZATION. 
Section 15(k) of the Small Business Act (15 U.S.C. 644(k)) 
is amended— 
(1) in paragraph (15), by striking ‘‘; and’’ and inserting 
a semicolon;
H. R. 1735—214 
(2) in paragraph (16)(C), by striking the period at the 
end and inserting ‘‘; and’’; and 
(3) by inserting after paragraph (16) the following new 
paragraph: 
‘‘(17) shall, when notified by a small business concern prior 
to the award of a contract that the small business concern 
believes that a solicitation, request for proposal, or request 
for quotation unduly restricts the ability of the small business 
concern to compete for the award— 
‘‘(A) submit the notice of the small business concern 
to the contracting officer and, if necessary, recommend 
ways in which the solicitation, request for proposal, or 
request for quotation may be altered to increase the oppor-
tunity for competition; 
‘‘(B) inform the advocate for competition of such agency 
(as established under section 1705 of title 41, United States 
Code, or section 2318 of title 10, United States Code) of 
such notice; and 
‘‘(C) ensure that the small business concern is aware 
of other resources and processes available to address 
unduly restrictive provisions in a solicitation, request for 
proposal, or request for quotation, even if such resources 
and processes are provided by such agency, the Administra-
tion, the Comptroller General, or a procurement technical 
assistance program established under chapter 142 of title 
10, United States Code.’’. 
SEC. 871. INCLUDING SUBCONTRACTING GOALS IN AGENCY RESPON-
SIBILITIES. 
Section 1633(b) of the National Defense Authorization Act for 
Fiscal Year 2013 (Public Law 112–239; 126 Stat. 2076; 15 U.S.C. 
631 note) is amended by striking ‘‘assume responsibility for of 
the agency’s success in achieving small business contracting goals 
and percentages’’ and inserting ‘‘assume responsibility for the 
agency’s success in achieving each of the small business prime 
contracting and subcontracting goals and percentages’’. 
SEC. 872. REPORTING RELATED TO FAILURE OF CONTRACTORS TO 
MEET 
GOALS 
UNDER 
NEGOTIATED 
COMPREHENSIVE 
SMALL BUSINESS SUBCONTRACTING PLANS. 
Paragraph (2) of section 834(d) of the National Defense 
Authorization Act for Fiscal Years 1990 and 1991 (15 U.S.C. 637 
note), as added by section 821(d)(2) of the Carl Levin and Howard 
P. ‘‘Buck’’ McKeon National Defense Authorization Act for Fiscal 
Year 2015 (Public Law 113–291; 128 Stat. 3434), is amended by 
striking ‘‘may not negotiate’’ and all that follows through the period 
at the end and inserting ‘‘shall report to Congress on any negotiated 
comprehensive subcontracting plan that the Secretary determines 
did not meet the subcontracting goals negotiated in the plan for 
the prior fiscal year.’’. 
SEC. 873. PILOT PROGRAM FOR STREAMLINING AWARDS FOR INNOVA-
TIVE TECHNOLOGY PROJECTS. 
(a) EXCEPTION FROM CERTIFIED COST
AND PRICING DATA 
REQUIREMENTS.—The requirements under section 2306a(a) of title 
10, United States Code, shall not apply to a contract, subcontract, 
or modification of a contract or subcontract valued at less than
H. R. 1735—215 
$7,500,000 awarded to a small business or nontraditional defense 
contractor pursuant to— 
(1) a technical, merit-based selection procedure, such as 
a broad agency announcement, or 
(2) the Small Business Innovation Research Program, 
unless the head of the agency determines that submission of cost 
and pricing data should be required based on past performance 
of the specific small business or nontraditional defense contractor, 
or based on analysis of other information specific to the award. 
(b) EXCEPTION FROM RECORDS EXAMINATION REQUIREMENT.— 
The requirements under subsection (b) of section 2313 of title 10, 
United States Code, shall not apply to a contract valued at less 
than $7,500,000 awarded to a small business or nontraditional 
defense contractor pursuant to— 
(1) a technical, merit-based selection procedure, such as 
a broad agency announcement, or 
(2) the Small Business Innovation Research Program, 
unless the head of the agency determines that auditing of records 
should be required based on past performance of the specific small 
business or nontraditional defense contractor, or based on analysis 
of other information specific to the award. 
(c) SUNSET.—The exceptions under subsections (a) and (b) shall 
terminate on October 1, 2020. 
(d) DEFINITIONS.—In this section: 
(1) SMALL BUSINESS.—The term ‘‘small business’’ has the 
meaning given the term ‘‘small business concern’’ under section 
3 of the Small Business Act (15 U.S.C. 632). 
(2) NONTRADITIONAL
DEFENSE
CONTRACTOR.—The term 
‘‘nontraditional defense contractor’’ has the meaning given that 
term in section 2302(9) of title 10, United States Code. 
(e) SMALL BUSINESS INNOVATION RESEARCH PROGRAM ADMINIS-
TRATIVE FEE EXTENSION.—Section 9(mm)(1) of the Small Business 
Act (15 U.S.C. 638(mm)(1)) is amended by striking ‘‘, for the 3 
fiscal years beginning after the date of enactment of this sub-
section,’’ and inserting ‘‘and until September 30, 2017,’’. 
SEC. 874. SURETY BOND REQUIREMENTS AND AMOUNT OF GUAR-
ANTEE. 
(a) SURETY BOND REQUIREMENTS.—Chapter 93 of subtitle VI 
of title 31, United States Code, is amended— 
(1) by adding at the end the following: 
‘‘§ 9310. Individual sureties 
‘‘If another applicable Federal law or regulation permits the 
acceptance of a bond from a surety that is not subject to sections 
9305 and 9306 and is based on a pledge of assets by the surety, 
the assets pledged by such surety shall— 
‘‘(1) consist of eligible obligations described under section 
9303(a); and 
‘‘(2) be submitted to the official of the Government required 
to approve or accept the bond, who shall deposit the obligations 
as described under section 9303(b).’’; and 
(2) in the table of contents for such chapter, by adding 
at the end the following: 
‘‘9310. Individual sureties.’’.