H. R. 4986—220 
SEC. 814. CLARIFICATION OF SUBMISSION OF COST OR PRICING DATA 
ON NONCOMMERCIAL MODIFICATIONS OF COMMERCIAL 
ITEMS. 
(a) MEASUREMENT OF PERCENTAGE AT CONTRACT AWARD.—Sec-
tion 2306a(b)(3)(A) of title 10, United States Code, is amended 
by inserting after ‘‘total price of the contract’’ the following: ‘‘(at 
the time of contract award)’’. 
(b) HARMONIZATION
OF THRESHOLDS
FOR COST
OR PRICING 
DATA.—Section 2306a(b)(3)(A) of title 10, United States Code, is 
amended by striking ‘‘$500,000’’ and inserting ‘‘the amount specified 
in subsection (a)(1)(A)(i), as adjusted from time to time under sub-
section (a)(7),’’. 
SEC. 815. CLARIFICATION OF RULES REGARDING THE PROCUREMENT 
OF COMMERCIAL ITEMS. 
(a) TREATMENT
OF SUBSYSTEMS, COMPONENTS, AND SPARE 
PARTS AS COMMERCIAL ITEMS.— 
(1) IN GENERAL.—Section 2379 of title 10, United States 
Code, is amended— 
(A) in subsection (a)— 
(i) by redesignating paragraph (2) as paragraph 
(3); 
(ii) in paragraph (1)(B), by striking ‘‘and’’ at the 
end; and 
(iii) by inserting after paragraph (1), the following: 
‘‘(2) the offeror has submitted sufficient information to 
evaluate, through price analysis, the reasonableness of the 
price for such system; and’’; 
(B) by striking subsection (b) and inserting the fol-
lowing new subsection (b): 
‘‘(b) TREATMENT
OF SUBSYSTEMS
AS COMMERCIAL ITEMS.—A 
subsystem of a major weapon system (other than a commercially 
available off-the-shelf item as defined in section 35(c) of the Office 
of Federal Procurement Policy Act (41 U.S.C. 431(c))) shall be 
treated as a commercial item and purchased under procedures 
established for the procurement of commercial items only if— 
‘‘(1) the subsystem is intended for a major weapon system 
that is being purchased, or has been purchased, under proce-
dures established for the procurement of commercial items 
in accordance with the requirements of subsection (a); or 
‘‘(2) the contracting officer determines in writing that— 
‘‘(A) the subsystem is a commercial item, as defined 
in section 4(12) of the Office of Federal Procurement Policy 
Act (41 U.S.C. 403(12)); and 
‘‘(B) the offeror has submitted sufficient information 
to evaluate, through price analysis, the reasonableness of 
the price for such subsystem.’’; 
(C) by redesignating subsections (c) and (d) as sub-
sections (e) and (f), respectively; and 
(D) by inserting after subsection (b) the following new 
subsections (c) and (d): 
‘‘(c) TREATMENT OF COMPONENTS AND SPARE PARTS AS COMMER-
CIAL ITEMS.—(1) A component or spare part for a major weapon 
system (other than a commercially available off-the-shelf item as 
defined in section 35(c) of the Office of Federal Procurement Policy 
Act (41 U.S.C. 431(c))) may be treated as a commercial item for 
the purposes of section 2306a of this title only if—
H. R. 4986—221 
‘‘(A) the component or spare part is intended for— 
‘‘(i) a major weapon system that is being purchased, 
or has been purchased, under procedures established for 
the procurement of commercial items in accordance with 
the requirements of subsection (a); or 
‘‘(ii) a subsystem of a major weapon system that is 
being purchased, or has been purchased, under procedures 
established for the procurement of commercial items in 
accordance with the requirements of subsection (b); or 
‘‘(B) the contracting officer determines in writing that— 
‘‘(i) the component or spare part is a commercial item, 
as defined in section 4(12) of the Office of Federal Procure-
ment Policy Act (41 U.S.C. 403(12)); and 
‘‘(ii) the offeror has submitted sufficient information 
to evaluate, through price analysis, the reasonableness of 
the price for such component or spare part. 
‘‘(2) This subsection shall apply only to components and spare 
parts that are acquired by the Department of Defense through 
a prime contract or a modification to a prime contract (or through 
a subcontract under a prime contract or modification to a prime 
contract on which the prime contractor adds no, or negligible, 
value). 
‘‘(d) INFORMATION SUBMITTED.—To the extent necessary to 
make a determination under subsection (a)(2), (b)(2), or (c)(1)(B), 
the contracting officer may request the offeror to submit— 
‘‘(1) prices paid for the same or similar commercial items 
under comparable terms and conditions by both government 
and commercial customers; and 
‘‘(2) if the contracting officer determines that the informa-
tion described in paragraph (1) is not sufficient to determine 
the reasonableness of price, other relevant information 
regarding the basis for price or cost, including information 
on labor costs, material costs, and overhead rates.’’. 
(2) CONFORMING AMENDMENT TO TECHNICAL DATA PROVI-
SION.—Section 2321(f)(2) of such title is amended by striking 
‘‘(whether or not under a contract for commercial items)’’ and 
inserting ‘‘(other than technical data for a commercially avail-
able off-the-shelf item as defined in section 35(c) of the Office 
of Federal Procurement Policy Act (41 U.S.C. 431(c)))’’. 
(b) SALES OF COMMERCIAL ITEMS TO NONGOVERNMENTAL ENTI-
TIES.—Not later than 180 days after the date of the enactment 
of this Act, the Secretary of Defense shall modify the regulations 
of the Department of Defense on the procurement of commercial 
items in order to clarify that the terms ‘‘general public’’ and ‘‘non-
governmental entities’’ in such regulations do not include the Fed-
eral Government or a State, local, or foreign government. 
SEC. 816. REVIEW OF SYSTEMIC DEFICIENCIES ON MAJOR DEFENSE 
ACQUISITION PROGRAMS. 
(a) ANNUAL REVIEW.—The Under Secretary of Defense for 
Acquisition, Technology, and Logistics shall conduct an annual 
review of systemic deficiencies in the major defense acquisition 
programs of the Department of Defense for each fiscal year in 
which three or more major defense acquisition programs— 
(1) experience a critical cost growth threshold breach; 
(2) have a section 2366a certification withdrawn; or
H. R. 4986—222 
(3) have a Milestone A approval or Key Decision Point 
A approval rescinded, by the milestone decision authority under 
subsection (b) of section 2366b of title 10, United States Code, 
as added by section 943 of this Act. 
(b) CONTENT OF REVIEW.—The review conducted under sub-
section (a) shall— 
(1) identify common factors, including any systemic defi-
ciencies in the budget, requirements, and acquisition policies 
and practices, that may have contributed to problems with 
major defense acquisition programs covered by the criteria in 
subsection (a); 
(2) assess the adequacy of corrective actions taken or to 
be taken to address cost growth or other performance defi-
ciencies in programs covered by the criteria in subsection (a); 
and 
(3) make recommendations for any changes in budget, 
requirements, and acquisition policies and practices that may 
be appropriate to avoid similar problems with major defense 
acquisition programs in the future. 
(c) DEFINITIONS.—In this section: 
(1) CRITICAL COST GROWTH THRESHOLD BREACH.—The term 
‘‘critical cost growth threshold breach’’ means a determination 
under section 2433(d) of title 10, United States Code, by the 
Secretary of a military department with respect to a major 
defense acquisition program that the program acquisition unit 
cost has increased by a percentage equal to or greater than 
the critical cost growth threshold or that the procurement unit 
cost has increased by a percentage equal to or greater than 
the critical cost growth threshold. 
(2) SECTION 2366a CERTIFICATION.—The term ‘‘section 2366a 
certification’’ means a certification with respect to a major 
defense acquisition program under section 2366a(a) of title 
10, United States Code, by the milestone decision authority. 
(d) REPORT.—Not later than July 15, 2008, and not later than 
August 15 of each year from 2009 through 2012, the Secretary 
of Defense shall submit to the congressional defense committees 
a report on the results of the annual review conducted (if any) 
for the preceding fiscal year under subsection (a). 
(e) SUNSET.—The requirement to conduct an annual review 
under subsection (a) shall terminate on September 30, 2012. 
SEC. 817. INVESTMENT STRATEGY FOR MAJOR DEFENSE ACQUISITION 
PROGRAMS. 
(a) REPORT REQUIRED.—Not later than May 1, 2008, the Sec-
retary of Defense shall submit to the congressional defense commit-
tees a report on the strategies of the Department of Defense for 
balancing the allocation of funds and other resources among major 
defense acquisition programs. 
(b) ELEMENTS.—The report required by subsection (a) shall 
address, at a minimum, the ability of the organizations, policies, 
and procedures of the Department of Defense to provide for— 
(1) establishing priorities among needed capabilities under 
major defense acquisition programs, and assessing the 
resources (including funds, technologies, time, and personnel) 
needed to achieve such capabilities; 
(2) balancing the cost, schedule, and requirements of major 
defense acquisition programs, including those within the same
H. R. 4986—223 
functional or mission area, to ensure the most efficient use 
of resources; and 
(3) ensuring that the budget, requirements, and acquisition 
processes of the Department of Defense work in a complemen-
tary manner to achieve desired results. 
(c) ROLE OF TRI-CHAIR COMMITTEE IN RESOURCE ALLOCATION.— 
(1) IN
GENERAL.—The report required by subsection (a) 
shall also address the role of the committee described in para-
graph (2) in the resource allocation process for major defense 
acquisition programs. 
(2) COMMITTEE.—The committee described in this para-
graph is a committee (to be known as the ‘‘Tri-Chair Com-
mittee’’) composed of the following: 
(A) The Under Secretary of Defense for Acquisition, 
Technology, and Logistics, who is one of the chairs of 
the committee. 
(B) The Vice Chairman of the Joint Chiefs of Staff, 
who is one of the chairs of the committee. 
(C) The Director of Program Analysis and Evaluation, 
who is one of the chairs of the committee. 
(D) Any other appropriate officials of the Department 
of Defense, as jointly agreed upon by the Under Secretary 
and the Vice Chairman. 
(d) CHANGES IN LAW.—The report required by subsection (a) 
shall, to the maximum extent practicable, include a discussion 
of any changes in the budget, acquisition, and requirements proc-
esses of the Department of Defense undertaken as a result of 
changes in law pursuant to any section in this Act. 
(e) RECOMMENDATIONS.—The report required by subsection (a) 
shall include any recommendations, including recommendations for 
legislative action, that the Secretary considers appropriate to 
improve the organizations, policies, and procedures described in 
the report. 
SEC. 818. REPORT ON IMPLEMENTATION OF RECOMMENDATIONS ON 
TOTAL OWNERSHIP COST FOR MAJOR WEAPON SYSTEMS. 
(a) REPORT REQUIRED.—Not later than 180 days after the date 
of the enactment of this Act, the Secretary of Defense shall submit 
to the congressional defense committees a report on the extent 
of the implementation of the recommendations set forth in the 
February 2003 report of the Government Accountability Office enti-
tled ‘‘Setting Requirements Differently Could Reduce Weapon Sys-
tems’ Total Ownership Costs’’. 
(b) ELEMENTS.—The report required by subsection (a) shall 
include the following: 
(1) For each recommendation described in subsection (a) 
that has been implemented, or that the Secretary plans to 
implement— 
(A) a summary of all actions that have been taken 
to implement such recommendation; and 
(B) a schedule, with specific milestones, for completing 
the implementation of such recommendation. 
(2) For each recommendation that the Secretary has not 
implemented and does not plan to implement— 
(A) the reasons for the decision not to implement such 
recommendation; and
H. R. 4986—224 
(B) a summary of any alternative actions the Secretary 
plans to take to address the purposes underlying such 
recommendation. 
(3) A summary of any additional actions the Secretary 
has taken or plans to take to ensure that total ownership 
cost is appropriately considered in the requirements process 
for major weapon systems. 
Subtitle C—Amendments to General Con-
tracting Authorities, Procedures, and 
Limitations 
SEC. 821. PLAN FOR RESTRICTING GOVERNMENT-UNIQUE CONTRACT 
CLAUSES ON COMMERCIAL CONTRACTS. 
(a) PLAN.—The Under Secretary of Defense for Acquisition, 
Technology, and Logistics shall develop and implement a plan to 
minimize the number of government-unique contract clauses used 
in commercial contracts by restricting the clauses to the following: 
(1) Government-unique clauses authorized by law or regula-
tion. 
(2) Any additional clauses that are relevant and necessary 
to a specific contract. 
(b) COMMERCIAL CONTRACT.—In this section: 
(1) The term ‘‘commercial contract’’ means a contract 
awarded by the Federal Government for the procurement of 
a commercial item. 
(2) The term ‘‘commercial item’’ has the meaning provided 
by section 4(12) of the Office of Federal Procurement Policy 
Act (41 U.S.C. 403(12)). 
SEC. 822. EXTENSION OF AUTHORITY FOR USE OF SIMPLIFIED 
ACQUISITION PROCEDURES FOR CERTAIN COMMERCIAL 
ITEMS. 
(a) EXTENSION.—Section 4202(e) of the Clinger-Cohen Act of 
1996 (division D of Public Law 104–106; 110 Stat. 652; 10 U.S.C. 
2304 note) is amended by striking ‘‘January 1, 2008’’ and inserting 
‘‘January 1, 2010’’. 
(b) REPORT.—Not later than March 1, 2008, the Under Sec-
retary of Defense for Acquisition, Technology, and Logistics shall 
submit to the Committees on Armed Services of the Senate and 
the House of Representatives a report on the use by the Department 
of Defense of the authority provided by section 4202(e) of the 
Clinger-Cohen Act of 1996 (10 U.S.C. 2304 note). The report shall 
include, at a minimum, the following: 
(1) Summary data on the use of the authority. 
(2) Specific examples of the use of the authority. 
(3) An evaluation of potential benefits and costs of 
extending the authority after January 1, 2010. 
SEC. 823. FIVE-YEAR EXTENSION OF AUTHORITY TO CARRY OUT CER-
TAIN PROTOTYPE PROJECTS. 
Section 845(i) of the National Defense Authorization Act for 
Fiscal Year 1994 (10 U.S.C. 2371 note) is amended by striking 
‘‘September 30, 2008’’ and inserting ‘‘September 30, 2013’’.
H. R. 4986—225 
SEC. 824. EXEMPTION OF SPECIAL OPERATIONS COMMAND FROM CER-
TAIN 
REQUIREMENTS 
FOR 
CERTAIN 
CONTRACTS 
RELATING 
TO 
VESSELS, 
AIRCRAFT, 
AND 
COMBAT 
VEHICLES. 
Section 2401(b) of title 10, United States Code, is amended 
by adding at the end the following new paragraph: 
‘‘(5) In the case of a contract described in subsection (a)(1)(B), 
the commander of the special operations command may make a 
contract without regard to this subsection if— 
‘‘(A) funds are available and obligated for the full cost 
of the contract (including termination costs) on or before the 
date the contract is awarded; 
‘‘(B) the Secretary of Defense submits to the congressional 
defense committees a certification that there is no alternative 
for meeting urgent operational requirements other than making 
the contract; and 
‘‘(C) a period of 30 days of continuous session of Congress 
has expired following the date on which the certification was 
received by such committees.’’. 
SEC. 825. PROVISION OF AUTHORITY TO MAINTAIN EQUIPMENT TO 
UNIFIED 
COMBATANT 
COMMAND 
FOR 
JOINT 
WARFIGHTING. 
(a) AUTHORITY.—Section 167a of title 10, United States Code, 
is amended— 
(1) in subsection (a), by striking ‘‘and acquire’’ and inserting 
‘‘, acquire, and maintain’’; 
(2) by redesignating subsection (f) as subsection (g); and 
(3) by inserting after subsection (e) the following new sub-
section: 
‘‘(f) LIMITATION ON AUTHORITY TO MAINTAIN EQUIPMENT.—The 
authority delegated under subsection (a) to maintain equipment 
is subject to the availability of funds authorized and appropriated 
specifically for that purpose.’’. 
(b) TWO-YEAR EXTENSION.—Subsection (g) of such section, as 
so redesignated, is amended— 
(1) by striking ‘‘through 2008’’ and inserting ‘‘through 
2010’’; and 
(2) by striking ‘‘September 30, 2008’’ and inserting ‘‘Sep-
tember 30, 2010’’. 
SEC. 826. MARKET RESEARCH. 
(a) ADDITIONAL REQUIREMENTS.—Subsection (c) of section 2377 
of title 10, United States Code, is amended— 
(1) in paragraph (1)— 
(A) by striking ‘‘and’’ at the end of subparagraph (A); 
(B) by striking the period at the end of subparagraph 
(B) and inserting ‘‘; and’’; and 
(C) by adding at the end the following: 
‘‘(C) before awarding a task order or delivery order 
in excess of the simplified acquisition threshold.’’; and 
(2) by adding at the end the following: 
‘‘(4) The head of an agency shall take appropriate steps to 
ensure that any prime contractor of a contract (or task order or 
delivery order) in an amount in excess of $5,000,000 for the procure-
ment of items other than commercial items engages in such market 
research as may be necessary to carry out the requirements of
H. R. 4986—226 
subsection (b)(2) before making purchases for or on behalf of the 
Department of Defense.’’. 
(b) REQUIREMENT TO DEVELOP TRAINING AND TOOLS.—The Sec-
retary of Defense shall develop training to assist contracting officers, 
and market research tools to assist such officers and prime contrac-
tors, in performing appropriate market research as required by 
subsection (c) of section 2377 of title 10, United States Code, as 
amended by this section. 
SEC. 827. MODIFICATION OF COMPETITION REQUIREMENTS FOR PUR-
CHASES FROM FEDERAL PRISON INDUSTRIES. 
(a) MODIFICATION OF COMPETITION REQUIREMENTS.— 
(1) IN GENERAL.—Section 2410n of title 10, United States 
Code, is amended by striking subsections (a) and (b) and 
inserting the following new subsections (a) and (b): 
‘‘(a) PRODUCTS FOR WHICH FEDERAL PRISON INDUSTRIES DOES 
NOT HAVE SIGNIFICANT MARKET SHARE.—(1) Before purchasing a 
product listed in the latest edition of the Federal Prison Industries 
catalog under section 4124(d) of title 18 for which Federal Prison 
Industries does not have a significant market share, the Secretary 
of Defense shall conduct market research to determine whether 
the product is comparable to products available from the private 
sector that best meet the needs of the Department in terms of 
price, quality, and time of delivery. 
‘‘(2) If the Secretary determines that a Federal Prison Industries 
product described in paragraph (1) is not comparable in price, 
quality, or time of delivery to products of the private sector that 
best meets the needs of the Department in terms of price, quality, 
and time of delivery, the Secretary shall use competitive procedures 
for the procurement of the product, or shall make an individual 
purchase under a multiple award contract in accordance with the 
competition requirements applicable to such contract. In conducting 
such a competition, the Secretary shall consider a timely offer 
from Federal Prison Industries. 
‘‘(b) PRODUCTS FOR WHICH FEDERAL PRISON INDUSTRIES HAS 
SIGNIFICANT MARKET SHARE.—(1) The Secretary of Defense may 
purchase a product listed in the latest edition of the Federal Prison 
Industries catalog for which Federal Prison Industries has a signifi-
cant market share only if the Secretary uses competitive procedures 
for the procurement of the product or makes an individual purchase 
under a multiple award contract in accordance with the competition 
requirements applicable to such contract. In conducting such a 
competition, the Secretary shall consider a timely offer from Federal 
Prison Industries. 
‘‘(2) For purposes of this subsection, Federal Prison Industries 
shall be treated as having a significant share of the market for 
a product if the Secretary, in consultation with the Administrator 
of Federal Procurement Policy, determines that the Federal Prison 
Industries share of the Department of Defense market for the 
category of products including such product is greater than 5 per-
cent.’’. 
(2) EFFECTIVE DATE.—The amendment made by subsection 
(a) shall take effect 60 days after the date of the enactment 
of this Act. 
(b) LIST OF PRODUCTS FOR WHICH FEDERAL PRISON INDUSTRIES 
HAS SIGNIFICANT MARKET SHARE.—
H. R. 4986—227 
(1) INITIAL LIST.—Not later than 60 days after the date 
of the enactment of this Act, the Secretary of Defense shall 
publish a list of product categories for which Federal Prison 
Industries’ share of the Department of Defense market is 
greater than 5 percent, based on the most recent fiscal year 
for which data is available. 
(2) MODIFICATION.—The Secretary may modify the list pub-
lished under paragraph (1) at any time if the Secretary deter-
mines that new data require adding a product category to 
the list or omitting a product category from the list. 
(3) CONSULTATION.—The Secretary shall carry out this sub-
section in consultation with the Administrator for Federal 
Procurement Policy. 
SEC. 828. MULTIYEAR CONTRACT AUTHORITY FOR ELECTRICITY FROM 
RENEWABLE ENERGY SOURCES. 
(a) MULTIYEAR CONTRACT AUTHORITY.—Chapter 141 of title 
10, United States Code, is amended by adding at the end the 
following new section: 
‘‘§ 2410q. Multiyear contracts: purchase of electricity from 
renewable energy sources 
‘‘(a) MULTIYEAR
CONTRACTS
AUTHORIZED.—Subject to sub-
section (b), the Secretary of Defense may enter into a contract 
for a period not to exceed 10 years for the purchase of electricity 
from sources of renewable energy, as that term is defined in section 
203(b)(2) of the Energy Policy Act of 2005 (42 U.S.C. 15852(b)(2)). 
‘‘(b) LIMITATIONS ON CONTRACTS FOR PERIODS IN EXCESS OF 
FIVE YEARS.—The Secretary may exercise the authority in sub-
section (a) to enter into a contract for a period in excess of five 
years only if the Secretary determines, on the basis of a business 
case analysis prepared by the Department of Defense, that— 
‘‘(1) the proposed purchase of electricity under such contract 
is cost effective for the Department of Defense; and 
‘‘(2) it would not be possible to purchase electricity from 
the source in an economical manner without the use of a 
contract for a period in excess of five years. 
‘‘(c) 
RELATIONSHIP
TO
OTHER
MULTIYEAR
CONTRACTING 
AUTHORITY.—Nothing in this section shall be construed to preclude 
the Department of Defense from using other multiyear contracting 
authority of the Department to purchase renewable energy.’’. 
(b) CLERICAL AMENDMENT.—The table of sections at the begin-
ning of chapter 141 of such title is amended by adding at the 
end the following new item: 
‘‘2410q. Multiyear contracts: purchase of electricity from renewable energy sources.’’. 
SEC. 829. PROCUREMENT OF FIRE RESISTANT RAYON FIBER FOR THE 
PRODUCTION OF UNIFORMS FROM FOREIGN SOURCES. 
(a) AUTHORITY TO PROCURE.—The Secretary of Defense may 
procure fire resistant rayon fiber for the production of uniforms 
that is manufactured in a foreign country referred to in subsection 
(d) if the Secretary determines either of the following: 
(1) That fire resistant rayon fiber for the production of 
uniforms is not available from sources within the national 
technology and industrial base. 
(2) That—
H. R. 4986—228 
(A) procuring fire resistant rayon fiber manufactured 
from suppliers within the national technology and indus-
trial base would result in sole-source contracts or sub-
contracts for the supply of fire resistant rayon fiber; and 
(B) such sole-source contracts or subcontracts would 
not be in the best interests of the Government or consistent 
with the objectives of section 2304 of title 10, United States 
Code. 
(b) SUBMISSION TO CONGRESS.—Not later than 30 days after 
making a determination under subsection (a), the Secretary shall 
submit to Congress a copy of the determination. 
(c) APPLICABILITY TO SUBCONTRACTS.—The authority under sub-
section (a) applies with respect to subcontracts under Department 
of Defense contracts as well as to such contracts. 
(d) FOREIGN COUNTRIES COVERED.—The authority under sub-
section (a) applies with respect to a foreign country that— 
(1) is a party to a defense memorandum of understanding 
entered into under section 2531 of title 10, United States Code; 
and 
(2) does not discriminate against defense items produced 
in the United States to a greater degree than the United 
States discriminates against defense items produced in that 
country. 
(e) NATIONAL TECHNOLOGY AND INDUSTRIAL BASE DEFINED.— 
In this section, the term ‘‘national technology and industrial base’’ 
has the meaning given that term in section 2500 of title 10, United 
States Code. 
(f) SUNSET.—The authority under subsection (a) shall expire 
on the date that is five years after the date of the enactment 
of this Act. 
SEC. 830. COMPTROLLER GENERAL REVIEW OF NONCOMPETITIVE 
AWARDS OF CONGRESSIONAL AND EXECUTIVE BRANCH 
INTEREST ITEMS. 
Not later than one year after the date of the enactment of 
this Act, the Comptroller General of the United States shall submit 
to the congressional defense committees a report on the use of 
procedures other than competitive procedures in the award of con-
tracts by the Department of Defense. The report shall compare 
the procedures used by the Department of Defense for the award 
of funds for new projects pursuant to congressionally directed 
spending items, as defined in rule XLIV of the Standing Rules 
of the Senate, or congressional earmarks, as defined in rule XXI 
of the Rules of the House of Representatives, with the procedures 
used by the Department of Defense for the award of funds for 
new projects of special interest to senior executive branch officials. 
Subtitle D—Accountability in Contracting 
SEC. 841. COMMISSION ON WARTIME CONTRACTING IN IRAQ AND 
AFGHANISTAN. 
(a) ESTABLISHMENT.—There is hereby established a commission 
to be known as the ‘‘Commission on Wartime Contracting’’ (in 
this section referred to as the ‘‘Commission’’). 
(b) MEMBERSHIP MATTERS.—
H. R. 4986—229 
(1) MEMBERSHIP.—The Commission shall be composed of 
8 members, as follows: 
(A) 2 members shall be appointed by the majority 
leader of the Senate, in consultation with the Chairmen 
of the Committee on Armed Services, the Committee on 
Homeland Security and Governmental Affairs, and the 
Committee on Foreign Relations of the Senate. 
(B) 2 members shall be appointed by the Speaker of 
the House of Representatives, in consultation with the 
Chairmen of the Committee on Armed Services, the Com-
mittee on Oversight and Government Reform, and the Com-
mittee on Foreign Affairs of the House of Representatives. 
(C) 1 member shall be appointed by the minority leader 
of the Senate, in consultation with the Ranking Minority 
Members of the Committee on Armed Services, the Com-
mittee on Homeland Security and Governmental Affairs, 
and the Committee on Foreign Relations of the Senate. 
(D) 1 member shall be appointed by the minority leader 
of the House of Representatives, in consultation with the 
Ranking Minority Member of the Committee on Armed 
Services, the Committee on Oversight and Government 
Reform, and the Committee on Foreign Affairs of the House 
of Representatives. 
(E) 2 members shall be appointed by the President, 
in consultation with the Secretary of Defense and the Sec-
retary of State. 
(2) DEADLINE FOR APPOINTMENTS.—All appointments to the 
Commission shall be made not later than 120 days after the 
date of the enactment of this Act. 
(3) CO-CHAIRMEN.—The Commission shall have two co- 
chairmen, including— 
(A) a co-chairman who shall be a member of the 
Commission jointly designated by the Speaker of the House 
of Representatives and the majority leader of the Senate; 
and 
(B) a co-chairman who shall be a member of the 
Commission jointly designated by the minority leader of 
the House of Representatives and the minority leader of 
the Senate. 
(4) VACANCY.—In the event of a vacancy in a seat on 
the Commission, the individual appointed to fill the vacant 
seat shall be— 
(A) appointed by the same officer (or the officer’s suc-
cessor) who made the appointment to the seat when the 
Commission was first established; and 
(B) if the officer in subparagraph (A) is of a party 
other than the party of the officer who made the appoint-
ment to the seat when the Commission was first estab-
lished, chosen in consultation with the senior officers in 
the Senate and the House of Representatives of the party 
which is the party of the officer who made the appointment 
to the seat when the Commission was first established. 
(c) DUTIES.— 
(1) GENERAL DUTIES.—The Commission shall study the fol-
lowing matters: 
(A) Federal agency contracting for the reconstruction 
of Iraq and Afghanistan.
H. R. 4986—230 
(B) Federal agency contracting for the logistical support 
of coalition forces operating in Iraq and Afghanistan. 
(C) Federal agency contracting for the performance 
of security functions in Iraq and Afghanistan. 
(2) SCOPE OF CONTRACTING COVERED.—The Federal agency 
contracting covered by this subsection includes contracts 
entered into both in the United States and abroad for the 
performance of activities described in paragraph (1). 
(3) PARTICULAR DUTIES.—In carrying out the study under 
this subsection, the Commission shall assess— 
(A) the extent of the reliance of the Federal Govern-
ment on contractors to perform functions (including secu-
rity functions) in Iraq and Afghanistan and the impact 
of this reliance on the achievement of the objectives of 
the United States; 
(B) the performance exhibited by Federal contractors 
for the contracts under review pursuant to paragraph (1), 
and the mechanisms used to evaluate contractor perform-
ance; 
(C) the extent of waste, fraud, and abuse under such 
contracts; 
(D) the extent to which those responsible for such 
waste, fraud, and abuse have been held financially or 
legally accountable; 
(E) the appropriateness of the organizational structure, 
policies, practices, and resources of the Department of 
Defense and the Department of State for handling program 
management and contracting for the programs and con-
tracts under review pursuant to paragraph (1); 
(F) the extent to which contractors under such con-
tracts have engaged in the misuse of force or have used 
force in a manner inconsistent with the objectives of the 
operational field commander; and 
(G) the extent of potential violations of the laws of 
war, Federal law, or other applicable legal standards by 
contractors under such contracts. 
(d) REPORTS.— 
(1) INTERIM REPORT.—On March 1, 2009, the Commission 
shall submit to Congress an interim report on the study carried 
out under subsection (c), including the results and findings 
of the study as of that date. 
(2) OTHER REPORTS.—The Commission may from time to 
time submit to Congress such other reports on the study carried 
out under subsection (c) as the Commission considers appro-
priate. 
(3) FINAL
REPORT.—Not later than two years after the 
date of the appointment of all of the members of the Commis-
sion under subsection (b), the Commission shall submit to Con-
gress a final report on the study carried out under subsection 
(c). The report shall— 
(A) include the findings of the Commission; 
(B) identify lessons learned relating to contingency pro-
gram management and contingency contracting covered by 
the study; and 
(C) include specific recommendations for improvements 
to be made in—
H. R. 4986—231 
(i) the process for defining requirements and devel-
oping statements of work for contracts in contingency 
contracting; 
(ii) the process for awarding contracts and task 
or delivery orders in contingency contracting; 
(iii) the process for contingency program manage-
ment; 
(iv) the process for identifying, addressing, and 
providing accountability for waste, fraud, and abuse 
in contingency contracting; 
(v) the process for determining which functions 
are inherently governmental and which functions are 
appropriate for performance by contractors in a contin-
gency operation (including during combat operations), 
especially whether providing security in an area of 
combat operations is inherently governmental; 
(vi) the organizational structure, resources, poli-
cies, and practices of the Department of Defense and 
the Department of State for performing contingency 
program management; and 
(vii) the process by which roles and responsibilities 
with respect to management and oversight of contracts 
in contingency contracting are distributed among the 
various departments and agencies of the Federal 
Government, and interagency coordination and commu-
nication mechanisms associated with contingency con-
tracting. 
(e) OTHER POWERS AND AUTHORITIES.— 
(1) HEARINGS AND EVIDENCE.—The Commission or, on the 
authority of the Commission, any portion thereof, may, for 
the purpose of carrying out this section— 
(A) hold such hearings and sit and act at such times 
and places, take such testimony, receive such evidence, 
administer such oaths (provided that the quorum for a 
hearing shall be three members of the Commission); and 
(B) provide for the attendance and testimony of such 
witnesses and the production of such books, records, cor-
respondence, memoranda, papers, and documents; 
as the Commission, or such portion thereof, may determine 
advisable. 
(2) INABILITY TO OBTAIN DOCUMENTS OR TESTIMONY.—In 
the event the Commission is unable to obtain testimony or 
documents needed to conduct its work, the Commission shall 
notify the committees of Congress of jurisdiction and appro-
priate investigative authorities. 
(3) ACCESS TO INFORMATION.—The Commission may secure 
directly from the Department of Defense and any other depart-
ment or agency of the Federal Government any information 
or assistance that the Commission considers necessary to enable 
the Commission to carry out the requirements of this section. 
Upon request of the Commission, the head of such department 
or agency shall furnish such information expeditiously to the 
Commission. Whenever information or assistance requested by 
the Commission is unreasonably refused or not provided, the 
Commission shall report the circumstances to Congress without 
delay.
H. R. 4986—232 
(4) PERSONNEL.—The Commission shall have the authori-
ties provided in section 3161 of title 5, United States Code, 
and shall be subject to the conditions set forth in such section, 
except to the extent that such conditions would be inconsistent 
with the requirements of this section. 
(5) DETAILEES.—Any employee of the Federal Government 
may be detailed to the Commission without reimbursement 
from the Commission, and such detailee shall retain the rights, 
status, and privileges of his or her regular employment without 
interruption. 
(6) SECURITY CLEARANCES.—The appropriate departments 
or agencies of the Federal Government shall cooperate with 
the Commission in expeditiously providing to the Commission 
members and staff appropriate security clearances to the extent 
possible pursuant to existing procedures and requirements, 
except that no person shall be provided with access to classified 
information under this section without the appropriate security 
clearances. 
(7) VIOLATIONS OF LAW.— 
(A) REFERRAL TO ATTORNEY GENERAL.—The Commis-
sion may refer to the Attorney General any violation or 
potential violation of law identified by the Commission 
in carrying out its duties under this section. 
(B) REPORTS ON RESULTS OF REFERRAL.—The Attorney 
General shall submit to Congress a report on each prosecu-
tion, conviction, resolution, or other disposition that results 
from a referral made under this subparagraph. 
(f) TERMINATION.—The Commission shall terminate on the date 
that is 60 days after the date of the submittal of its final report 
under subsection (d)(3). 
(g) DEFINITIONS.—In this section: 
(1) CONTINGENCY
CONTRACTING.—The term ‘‘contingency 
contracting’’ means all stages of the process of acquiring prop-
erty or services during a contingency operation. 
(2) CONTINGENCY OPERATION.—The term ‘‘contingency oper-
ation’’ has the meaning given that term in section 101 of 
title 10, United States Code. 
(3) CONTINGENCY
PROGRAM
MANAGEMENT.—The term 
‘‘contingency program management’’ means the process of plan-
ning, organizing, staffing, controlling, and leading the combined 
efforts of participating personnel for the management of a 
specific acquisition program or programs during contingency 
operations. 
SEC. 842. INVESTIGATION OF WASTE, FRAUD, AND ABUSE IN WARTIME 
CONTRACTS AND CONTRACTING PROCESSES IN IRAQ 
AND AFGHANISTAN. 
(a) AUDITS REQUIRED.—Thorough audits shall be performed 
in accordance with this section to identify potential waste, fraud, 
and abuse in the performance of— 
(1) Department of Defense contracts, subcontracts, and task 
and delivery orders for the logistical support of coalition forces 
in Iraq and Afghanistan; and 
(2) Federal agency contracts, subcontracts, and task and 
delivery orders for the performance of security and reconstruc-
tion functions in Iraq and Afghanistan. 
(b) AUDIT PLANS.—
H. R. 4986—233 
(1) The Department of Defense Inspector General shall 
develop a comprehensive plan for a series of audits of contracts, 
subcontracts, and task and delivery orders covered by sub-
section (a)(1), consistent with the requirements of subsection 
(g), in consultation with other Inspectors General specified in 
subsection (c) with regard to any contracts, subcontracts, or 
task or delivery orders over which such Inspectors General 
have jurisdiction. 
(2) The Special Inspector General for Iraq Reconstruction 
shall develop a comprehensive plan for a series of audits of 
contracts, subcontracts, and task and delivery orders covered 
by subsection (a)(2) relating to Iraq, consistent with the require-
ments of subsection (h), in consultation with other Inspectors 
General specified in subsection (c) with regard to any contracts, 
subcontracts, or task or delivery orders over which such Inspec-
tors General have jurisdiction. 
(3) The Special Inspector General for Afghanistan 
Reconstruction shall develop a comprehensive plan for a series 
of audits of contracts, subcontracts, and task and delivery 
orders covered by subsection (a)(2) relating to Afghanistan, 
consistent with the requirements of subsection (h), in consulta-
tion with other Inspectors General specified in subsection (c) 
with regard to any contracts, subcontracts, or task or delivery 
orders over which such Inspectors General have jurisdiction. 
(c) PERFORMANCE
OF AUDITS
BY CERTAIN INSPECTORS GEN-
ERAL.—The Special Inspector General for Iraq Reconstruction, 
during such period as such office exists, the Special Inspector Gen-
eral for Afghanistan Reconstruction, during such period as such 
office exists, the Inspector General of the Department of Defense, 
the Inspector General of the Department of State, and the Inspector 
General of the United States Agency for International Development 
shall perform such audits as required by subsection (a) and identi-
fied in the audit plans developed pursuant to subsection (b) as 
fall within the respective scope of their duties as specified in law. 
(d) COORDINATION OF AUDITS.—The Inspectors General speci-
fied in subsection (c) shall work to coordinate the performance 
of the audits required by subsection (a) and identified in the audit 
plans developed under subsection (b) including through councils 
and working groups composed of such Inspectors General. 
(e) JOINT AUDITS.—If one or more audits required by subsection 
(a) and identified in an audit plan developed under subsection 
(b) falls within the scope of the duties of more than one of the 
Inspectors General specified in subsection (c), and such Inspectors 
General agree that such audit or audits are best pursued jointly, 
such Inspectors General shall enter into a memorandum of under-
standing relating to the performance of such audit or audits. 
(f) SEPARATE AUDITS.—If one or more audits required by sub-
section (a) and identified in an audit plan developed under sub-
section (b) falls within the scope of the duties of more than one 
of the Inspectors General specified in subsection (c), and such 
Inspectors General do not agree that such audit or audits are 
best pursued jointly, such audit or audits shall be separately per-
formed by one or more of the Inspectors General concerned. 
(g) SCOPE OF AUDITS OF CONTRACTS.—Audits conducted pursu-
ant to subsection (a)(1) shall examine, at a minimum, one or more 
of the following issues:
H. R. 4986—234 
(1) The manner in which contract requirements were devel-
oped. 
(2) The procedures under which contracts or task or 
delivery orders were awarded. 
(3) The terms and conditions of contracts or task or delivery 
orders. 
(4) The staffing and method of performance of contractors, 
including cost controls. 
(5) The efficacy of Department of Defense management 
and oversight, including the adequacy of staffing and training 
of officials responsible for such management and oversight. 
(6) The flow of information from contractors to officials 
responsible for contract management and oversight. 
(h) SCOPE OF AUDITS OF OTHER CONTRACTS.—Audits conducted 
pursuant to subsection (a)(2) shall examine, at a minimum, one 
or more of the following issues: 
(1) The manner in which contract requirements were devel-
oped and contracts or task and delivery orders were awarded. 
(2) The manner in which the Federal agency exercised 
control over the performance of contractors. 
(3) The extent to which operational field commanders were 
able to coordinate or direct the performance of contractors 
in an area of combat operations. 
(4) The degree to which contractor employees were properly 
screened, selected, trained, and equipped for the functions to 
be performed. 
(5) The nature and extent of any incidents of misconduct 
or unlawful activity by contractor employees. 
(6) The nature and extent of any activity by contractor 
employees that was inconsistent with the objectives of oper-
ational field commanders. 
(7) The extent to which any incidents of misconduct or 
unlawful activity were reported, documented, investigated, and 
(where appropriate) prosecuted. 
(i) INDEPENDENT CONDUCT
OF AUDIT FUNCTIONS.—All audit 
functions under this section, including audit planning and coordina-
tion, shall be performed by the relevant Inspectors General in 
an independent manner, without consultation with the Commission 
established pursuant to section 841 of this Act. All audit reports 
resulting from such audits shall be available to the Commission. 
SEC. 843. ENHANCED COMPETITION REQUIREMENTS FOR TASK AND 
DELIVERY ORDER CONTRACTS. 
(a) DEFENSE CONTRACTS.— 
(1) LIMITATION
ON
SINGLE
AWARD
CONTRACTS.—Section 
2304a(d) of title 10, United States Code, is amended— 
(A) by redesignating paragraph (3) as paragraph (4); 
and 
(B) by inserting after paragraph (2) the following new 
paragraph (3): 
‘‘(3)(A) No task or delivery order contract in an amount esti-
mated to exceed $100,000,000 (including all options) may be 
awarded to a single source unless the head of the agency determines 
in writing that— 
‘‘(i) the task or delivery orders expected under the contract 
are so integrally related that only a single source can reason-
ably perform the work;
H. R. 4986—235 
‘‘(ii) the contract provides only for firm, fixed price task 
orders or delivery orders for— 
‘‘(I) products for which unit prices are established in 
the contract; or 
‘‘(II) services for which prices are established in the 
contract for the specific tasks to be performed; 
‘‘(iii) only one source is qualified and capable of performing 
the work at a reasonable price to the government; or 
‘‘(iv) because of exceptional circumstances, it is necessary 
in the public interest to award the contract to a single source. 
‘‘(B) The head of the agency shall notify Congress within 30 
days after any determination under subparagraph (A)(iv).’’. 
(2) ENHANCED
COMPETITION
FOR
ORDERS
IN
EXCESS
OF 
$5,000,000.—Section 2304c of such title is amended— 
(A) by redesignating subsections (d), (e), and (f) as 
subsections (e), (f), and (g), respectively; 
(B) by inserting after subsection (c) the following new 
subsection (d): 
‘‘(d) ENHANCED
COMPETITION
FOR
ORDERS
IN
EXCESS
OF 
$5,000,000.—In the case of a task or delivery order in excess of 
$5,000,000, the requirement to provide all contractors a fair oppor-
tunity to be considered under subsection (b) is not met unless 
all such contractors are provided, at a minimum— 
‘‘(1) a notice of the task or delivery order that includes 
a clear statement of the agency’s requirements; 
‘‘(2) a reasonable period of time to provide a proposal in 
response to the notice; 
‘‘(3) disclosure of the significant factors and subfactors, 
including cost or price, that the agency expects to consider 
in evaluating such proposals, and their relative importance; 
‘‘(4) in the case of an award that is to be made on a 
best value basis, a written statement documenting the basis 
for the award and the relative importance of quality and price 
or cost factors; and 
‘‘(5) an opportunity for a post-award debriefing consistent 
with the requirements of section 2305(b)(5) of this title.’’; and 
(C) by striking subsection (e), as redesignated by para-
graph (1), and inserting the following new subsection (e): 
‘‘(e) PROTESTS.—(1) A protest is not authorized in connection 
with the issuance or proposed issuance of a task or delivery order 
except for— 
‘‘(A) a protest on the ground that the order increases the 
scope, period, or maximum value of the contract under which 
the order is issued; or 
‘‘(B) a protest of an order valued in excess of $10,000,000. 
‘‘(2) Notwithstanding section 3556 of title 31, the Comptroller 
General of the United States shall have exclusive jurisdiction of 
a protest authorized under paragraph (1)(B). 
‘‘(3) This subsection shall be in effect for three years, beginning 
on the date that is 120 days after the date of the enactment 
of the National Defense Authorization Act for Fiscal Year 2008.’’. 
(3) EFFECTIVE DATES.— 
(A) SINGLE
AWARD
CONTRACTS.—The amendments 
made by paragraph (1) shall take effect on the date that 
is 120 days after the date of the enactment of this Act, 
and shall apply with respect to any contract awarded on 
or after such date.
H. R. 4986—236 
(B) ORDERS IN EXCESS OF $5,000,000.—The amendments 
made by paragraph (2) shall take effect on the date that 
is 120 days after the date of the enactment of this Act, 
and shall apply with respect to any task or delivery order 
awarded on or after such date. 
(b) CIVILIAN AGENCY CONTRACTS.— 
(1) LIMITATION
ON
SINGLE
AWARD
CONTRACTS.—Section 
303H(d) of the Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 253h(d)) is amended— 
(A) by redesignating paragraph (3) as paragraph (4); 
and 
(B) by inserting after paragraph (2) the following new 
paragraph (3): 
‘‘(3)(A) No task or delivery order contract in an amount esti-
mated to exceed $100,000,000 (including all options) may be 
awarded to a single source unless the head of the executive agency 
determines in writing that— 
‘‘(i) the task or delivery orders expected under the contract 
are so integrally related that only a single source can reason-
ably perform the work; 
‘‘(ii) the contract provides only for firm, fixed price task 
orders or delivery orders for— 
‘‘(I) products for which unit prices are established in 
the contract; or 
‘‘(II) services for which prices are established in the 
contract for the specific tasks to be performed; 
‘‘(iii) only one source is qualified and capable of performing 
the work at a reasonable price to the government; or 
‘‘(iv) because of exceptional circumstances, it is necessary 
in the public interest to award the contract to a single source. 
‘‘(B) The head of the executive agency shall notify Congress 
within 30 days after any determination under subparagraph 
(A)(iv).’’. 
(2) ENHANCED
COMPETITION
FOR
ORDERS
IN
EXCESS
OF 
$5,000,000.—Section 303J of such Act (41 U.S.C. 253j) is 
amended— 
(A) by redesignating subsections (d), (e), and (f) as 
subsections (e), (f), and (g), respectively; 
(B) by inserting after subsection (c) the following new 
subsection (d): 
‘‘(d) ENHANCED
COMPETITION
FOR
ORDERS
IN
EXCESS
OF 
$5,000,000.—In the case of a task or delivery order in excess of 
$5,000,000, the requirement to provide all contractors a fair oppor-
tunity to be considered under subsection (b) is not met unless 
all such contractors are provided, at a minimum— 
‘‘(1) a notice of the task or delivery order that includes 
a clear statement of the executive agency’s requirements; 
‘‘(2) a reasonable period of time to provide a proposal in 
response to the notice; 
‘‘(3) disclosure of the significant factors and subfactors, 
including cost or price, that the executive agency expects to 
consider in evaluating such proposals, and their relative impor-
tance; 
‘‘(4) in the case of an award that is to be made on a 
best value basis, a written statement documenting the basis 
for the award and the relative importance of quality and price 
or cost factors; and
H. R. 4986—237 
‘‘(5) an opportunity for a post-award debriefing consistent 
with the requirements of section 303B(e).’’; and 
(C) by striking subsection (e), as redesignated by para-
graph (1), and inserting the following new subsection (e): 
‘‘(e) PROTESTS.—(1) A protest is not authorized in connection 
with the issuance or proposed issuance of a task or delivery order 
except for— 
‘‘(A) a protest on the ground that the order increases the 
scope, period, or maximum value of the contract under which 
the order is issued; or 
‘‘(B) a protest of an order valued in excess of $10,000,000. 
‘‘(2) Notwithstanding section 3556 of title 31, United States 
Code, the Comptroller General of the United States shall have 
exclusive jurisdiction of a protest authorized under paragraph (1)(B). 
‘‘(3) This subsection shall be in effect for three years, beginning 
on the date that is 120 days after the date of the enactment 
of the National Defense Authorization Act for Fiscal Year 2008.’’. 
(3) EFFECTIVE DATES.— 
(A) SINGLE
AWARD
CONTRACTS.—The amendments 
made by paragraph (1) shall take effect on the date that 
is 120 days after the date of the enactment of this Act, 
and shall apply with respect to any contract awarded on 
or after such date. 
(B) ORDERS IN EXCESS OF $5,000,000.—The amendments 
made by paragraph (2) shall take effect on the date that 
is 120 days after the date of the enactment of this Act, 
and shall apply with respect to any task or delivery order 
awarded on or after such date. 
SEC. 844. PUBLIC DISCLOSURE OF JUSTIFICATION AND APPROVAL 
DOCUMENTS FOR NONCOMPETITIVE CONTRACTS. 
(a) CIVILIAN AGENCY CONTRACTS.— 
(1) IN GENERAL.—Section 303 of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 253) is amended 
by adding at the end the following new subsection: 
‘‘(j)(1)(A) Except as provided in subparagraph (B), in the case 
of a procurement permitted by subsection (c), the head of an execu-
tive agency shall make publicly available, within 14 days after 
the award of the contract, the documents containing the justification 
and approval required by subsection (f)(1) with respect to the 
procurement. 
‘‘(B) In the case of a procurement permitted by subsection 
(c)(2), subparagraph (A) shall be applied by substituting ‘30 days’ 
for ‘14 days’. 
‘‘(2) The documents shall be made available on the website 
of the agency and through a government-wide website selected 
by the Administrator for Federal Procurement Policy. 
‘‘(3) This subsection does not require the public availability 
of information that is exempt from public disclosure under section 
552(b) of title 5, United States Code.’’. 
(2) CONFORMING AMENDMENT.—Section 303(f) of such Act 
is amended— 
(A) by striking paragraph (4); and 
(B) by redesignating paragraph (5) as paragraph (4). 
(b) DEFENSE AGENCY CONTRACTS.—
H. R. 4986—238 
(1) IN GENERAL.—Section 2304 of title 10, United States 
Code, is amended by adding at the end the following new 
subsection: 
‘‘(l)(1)(A) Except as provided in subparagraph (B), in the case 
of a procurement permitted by subsection (c), the head of an agency 
shall make publicly available, within 14 days after the award of 
the contract, the documents containing the justification and 
approval required by subsection (f)(1) with respect to the procure-
ment. 
‘‘(B) In the case of a procurement permitted by subsection 
(c)(2), subparagraph (A) shall be applied by substituting ‘30 days’ 
for ‘14 days’. 
‘‘(2) The documents shall be made available on the website 
of the agency and through a government-wide website selected 
by the Administrator for Federal Procurement Policy. 
‘‘(3) This subsection does not require the public availability 
of information that is exempt from public disclosure under section 
552(b) of title 5.’’. 
(2) CONFORMING AMENDMENT.—Section 2304(f) of such title 
is amended— 
(A) by striking paragraph (4); and 
(B) by redesignating paragraphs (5) and (6) as para-
graphs (4) and (5), respectively. 
SEC. 
845. 
DISCLOSURE 
OF 
GOVERNMENT 
CONTRACTOR 
AUDIT 
FINDINGS. 
(a) REQUIRED ANNEX ON SIGNIFICANT AUDIT FINDINGS.— 
(1) IN GENERAL.—Each Inspector General appointed under 
the Inspector General Act of 1978 shall submit, as part of 
the semiannual report submitted to Congress pursuant to sec-
tion 5 of such Act, an annex on final, completed contract audit 
reports issued to the contracting activity containing significant 
audit findings issued during the period covered by the semi-
annual report concerned. 
(2) ELEMENTS.—Such annex shall include— 
(A) a list of such contract audit reports; 
(B) for each audit report, a brief description of the 
nature of the significant audit findings in the report; and 
(C) for each audit report, the specific amounts of costs 
identified as unsupported, questioned, or disallowed. 
(3) INFORMATION EXEMPT FROM PUBLIC DISCLOSURE.—(A) 
Nothing in this subsection shall be construed to require the 
release of information to the public that is exempt from public 
disclosure under section 552(b) of title 5, United States Code. 
(B) For each element required by paragraph (2), the 
Inspector General concerned shall note each instance where 
information has been redacted in accordance with the require-
ments of section 552(b) of title 5, United States Code, and 
submit an unredacted annex to the committees listed in sub-
section (d)(2) within 7 days after the issuance of the semiannual 
report. 
(b) DEFENSE CONTRACT AUDIT AGENCY INCLUDED.—For pur-
poses of subsection (a), audits of the Defense Contract Audit Agency 
shall be included in the annex provided by the Inspector General 
of the Department of Defense if they include significant audit 
findings.
H. R. 4986—239 
(c) EXCEPTION.—Subsection (a) shall not apply to an Inspector 
General if no audits described in such subsection were issued during 
the covered period. 
(d) SUBMISSION OF INDIVIDUAL AUDITS.— 
(1) REQUIREMENT.—The head of each Federal department 
or agency shall provide, within 14 days after a request in 
writing by the chairman or ranking member of any committee 
listed in paragraph (2), a full and unredacted copy of any 
audit described in subsection (a). Such copy shall include an 
identification of information in the audit exempt from public 
disclosure under section 552(b) of title 5, United States Code. 
(2) COMMITTEES.—The committees listed in this paragraph 
are the following: 
(A) The Committee on Oversight and Government 
Reform of the House of Representatives. 
(B) The Committee on Homeland Security and Govern-
mental Affairs of the Senate. 
(C) The Committees on Appropriations of the House 
of Representatives and the Senate. 
(D) With respect to the Department of Defense and 
the Department of Energy, the Committees on Armed Serv-
ices of the Senate and House of Representatives. 
(E) The Committees of primary jurisdiction over the 
agency or department to which the request is made. 
(e) CLASSIFIED INFORMATION.—Nothing in this section shall 
be interpreted to require the handling of classified information 
or information relating to intelligence sources and methods in a 
manner inconsistent with any law, regulation, executive order, or 
rule of the House of Representatives or of the Senate relating 
to the handling or protection of such information. 
(f) DEFINITIONS.—In this section: 
(1) SIGNIFICANT
AUDIT
FINDINGS.—The term ‘‘significant 
audit findings’’ includes— 
(A) unsupported, questioned, or disallowed costs in an 
amount in excess of $10,000,000; or 
(B) other findings that the Inspector General of the 
agency or department concerned determines to be signifi-
cant. 
(2) CONTRACT.—The term ‘‘contract’’ includes a contract, 
an order placed under a task or delivery order contract, or 
a subcontract. 
SEC. 
846. 
PROTECTION 
FOR 
CONTRACTOR 
EMPLOYEES 
FROM 
REPRISAL FOR DISCLOSURE OF CERTAIN INFORMATION. 
(a) INCREASED PROTECTION FROM REPRISAL.—Subsection (a) of 
section 2409 of title 10, United States Code, is amended— 
(1) by striking ‘‘disclosing to a Member of Congress’’ and 
inserting ‘‘disclosing to a Member of Congress, a representative 
of a committee of Congress, an Inspector General, the Govern-
ment Accountability Office, a Department of Defense employee 
responsible for contract oversight or management,’’; and 
(2) by striking ‘‘information relating to a substantial viola-
tion of law related to a contract (including the competition 
for or negotiation of a contract)’’ and inserting ‘‘information 
that the employee reasonably believes is evidence of gross mis-
management of a Department of Defense contract or grant, 
a gross waste of Department of Defense funds, a substantial
H. R. 4986—240 
and specific danger to public health or safety, or a violation 
of law related to a Department of Defense contract (including 
the competition for or negotiation of a contract) or grant’’. 
(b) CLARIFICATION OF INSPECTOR GENERAL DETERMINATION.— 
Subsection (b) of such section is amended— 
(1) by inserting ‘‘(1)’’ after ‘‘INVESTIGATION
OF
COM-
PLAINTS.—’’; 
(2) by striking ‘‘an agency’’ and inserting ‘‘the Department 
of Defense, or the Inspector General of the National Aeronautics 
and Space Administration in the case of a complaint regarding 
the National Aeronautics and Space Administration’’; and 
(3) by adding at the end the following new paragraph: 
‘‘(2)(A) Except as provided under subparagraph (B), the 
Inspector General shall make a determination that a complaint 
is frivolous or submit a report under paragraph (1) within 180 
days after receiving the complaint. 
‘‘(B) If the Inspector General is unable to complete an investiga-
tion in time to submit a report within the 180-day period specified 
in subparagraph (A) and the person submitting the complaint agrees 
to an extension of time, the Inspector General shall submit a 
report under paragraph (1) within such additional period of time 
as shall be agreed upon between the Inspector General and the 
person submitting the complaint.’’. 
(c) ACCELERATION OF SCHEDULE FOR DENYING RELIEF OR PRO-
VIDING REMEDY.—Subsection (c) of such section is amended— 
(1) in paragraph (1), by striking ‘‘If the head of the agency 
determines that a contractor has subjected a person to a 
reprisal prohibited by subsection (a), the head of the agency 
may’’ and inserting after ‘‘(1)’’ the following: ‘‘Not later than 
30 days after receiving an Inspector General report pursuant 
to subsection (b), the head of the agency concerned shall deter-
mine whether there is sufficient basis to conclude that the 
contractor concerned has subjected the complainant to a 
reprisal prohibited by subsection (a) and shall either issue 
an order denying relief or shall’’; 
(2) by redesignating paragraphs (2) and (3) as paragraphs 
(4) and (5), respectively; and 
(3) by inserting after paragraph (1) the following new para-
graphs: 
‘‘(2) If the head of an executive agency issues an order denying 
relief under paragraph (1) or has not issued an order within 210 
days after the submission of a complaint under subsection (b), 
or in the case of an extension of time under paragraph (b)(2)(B), 
not later than 30 days after the expiration of the extension of 
time, and there is no showing that such delay is due to the bad 
faith of the complainant, the complainant shall be deemed to have 
exhausted all administrative remedies with respect to the com-
plaint, and the complainant may bring a de novo action at law 
or equity against the contractor to seek compensatory damages 
and other relief available under this section in the appropriate 
district court of the United States, which shall have jurisdiction 
over such an action without regard to the amount in controversy. 
Such an action shall, at the request of either party to the action, 
be tried by the court with a jury. 
‘‘(3) An Inspector General determination and an agency head 
order denying relief under paragraph (2) shall be admissible in
H. R. 4986—241 
evidence in any de novo action at law or equity brought pursuant 
to this subsection.’’. 
(d) DEFINITIONS.—Subsection (e) of such section is amended— 
(1) in paragraph (4), by inserting ‘‘or a grant’’ after ‘‘a 
contract’’; and 
(2) by inserting before the period at the end the following: 
‘‘and any Inspector General that receives funding from, or has 
oversight over contracts awarded for or on behalf of, the Sec-
retary of Defense’’. 
SEC. 847. REQUIREMENTS FOR SENIOR DEPARTMENT OF DEFENSE 
OFFICIALS SEEKING EMPLOYMENT WITH DEFENSE CON-
TRACTORS. 
(a) REQUIREMENT TO SEEK AND OBTAIN WRITTEN OPINION.— 
(1) REQUEST.—An official or former official of the Depart-
ment of Defense described in subsection (c) who, within two 
years after leaving service in the Department of Defense, 
expects to receive compensation from a Department of Defense 
contractor, shall, prior to accepting such compensation, request 
a written opinion regarding the applicability of post-employ-
ment restrictions to activities that the official or former official 
may undertake on behalf of a contractor. 
(2) SUBMISSION
OF
REQUEST.—A request for a written 
opinion under paragraph (1) shall be submitted in writing 
to an ethics official of the Department of Defense having respon-
sibility for the organization in which the official or former 
official serves or served and shall set forth all information 
relevant to the request, including information relating to 
government positions held and major duties in those positions, 
actions taken concerning future employment, positions sought, 
and future job descriptions, if applicable. 
(3) WRITTEN
OPINION.—Not later than 30 days after 
receiving a request by an official or former official of the Depart-
ment of Defense described in subsection (c), the appropriate 
ethics counselor shall provide such official or former official 
a written opinion regarding the applicability or inapplicability 
of post-employment restrictions to activities that the official 
or former official may undertake on behalf of a contractor. 
(4) CONTRACTOR REQUIREMENT.—A Department of Defense 
contractor may not knowingly provide compensation to a former 
Department of Defense official described in subsection (c) within 
two years after such former official leaves service in the Depart-
ment of Defense, without first determining that the former 
official has sought and received (or has not received after 30 
days of seeking) a written opinion from the appropriate ethics 
counselor regarding the applicability of post-employment 
restrictions to the activities that the former official is expected 
to undertake on behalf of the contractor. 
(5) ADMINISTRATIVE ACTIONS.—In the event that an official 
or former official of the Department of Defense described in 
subsection (c), or a Department of Defense contractor, know-
ingly fails to comply with the requirements of this subsection, 
the Secretary of Defense may take any of the administrative 
actions set forth in section 27(e) of the Office of Federal Procure-
ment Policy Act (41 U.S.C. 423(e)) that the Secretary of Defense 
determines to be appropriate. 
(b) RECORDKEEPING REQUIREMENT.—
H. R. 4986—242 
(1) DATABASE.—Each request for a written opinion made 
pursuant to this section, and each written opinion provided 
pursuant to such a request, shall be retained by the Department 
of Defense in a central database or repository for not less 
than five years beginning on the date on which the written 
opinion was provided. 
(2) INSPECTOR GENERAL REVIEW.—The Inspector General 
of the Department of Defense shall conduct periodic reviews 
to ensure that written opinions are being provided and retained 
in accordance with the requirements of this section. The first 
such review shall be conducted no later than two years after 
the date of the enactment of this Act. 
(c) COVERED DEPARTMENT OF DEFENSE OFFICIALS.—An official 
or former official of the Department of Defense is covered by the 
requirements of this section if such official or former official— 
(1) participated personally and substantially in an acquisi-
tion as defined in section 4(16) of the Office of Federal Procure-
ment Policy Act with a value in excess of $10,000,000 and 
serves or served— 
(A) in an Executive Schedule position under subchapter 
II of chapter 53 of title 5, United States Code; 
(B) in a position in the Senior Executive Service under 
subchapter VIII of chapter 53 of title 5, United States 
Code; or 
(C) in a general or flag officer position compensated 
at a rate of pay for grade O–7 or above under section 
201 of title 37, United States Code; or 
(2) serves or served as a program manager, deputy program 
manager, procuring contracting officer, administrative con-
tracting officer, source selection authority, member of the source 
selection evaluation board, or chief of a financial or technical 
evaluation team for a contract in an amount in excess of 
$10,000,000. 
(d) DEFINITION.—In this section, the term ‘‘post-employment 
restrictions’’ includes— 
(1) section 27 of the Office of Federal Procurement Policy 
Act (41 U.S.C. 423); 
(2) section 207 of title 18, United States Code; and 
(3) any other statute or regulation restricting the employ-
ment or activities of individuals who leave government service 
in the Department of Defense. 
SEC. 848. REPORT ON CONTRACTOR ETHICS PROGRAMS OF MAJOR 
DEFENSE CONTRACTORS. 
(a) REPORT REQUIRED.—Not later than one year after the date 
of the enactment of this Act, the Comptroller General of the United 
States shall submit to the Committees on Armed Services of the 
Senate and the House of Representatives a report on the internal 
ethics programs of major defense contractors. 
(b) ELEMENTS.—The report required by subsection (a) shall 
address, at a minimum— 
(1) the extent to which major defense contractors have 
internal ethics programs in place; 
(2) the extent to which the ethics programs described in 
paragraph (1) include—
H. R. 4986—243 
(A) the availability of internal mechanisms, such as 
hotlines, for contractor employees to report conduct that 
may violate applicable requirements of law or regulation; 
(B) notification to contractor employees of the avail-
ability of external mechanisms, such as the hotline of the 
Inspector General of the Department of Defense, for the 
reporting of conduct that may violate applicable require-
ments of law or regulation; 
(C) notification to contractor employees of their right 
to be free from reprisal for disclosing a substantial violation 
of law related to a contract, in accordance with section 
2409 of title 10, United States Code; 
(D) ethics training programs for contractor officers and 
employees; 
(E) internal audit or review programs to identify and 
address conduct that may violate applicable requirements 
of law or regulation; 
(F) self-reporting requirements, under which contrac-
tors report conduct that may violate applicable require-
ments of law or regulation to appropriate government offi-
cials; 
(G) disciplinary action for contractor employees whose 
conduct is determined to have violated applicable require-
ments of law or regulation; and 
(H) appropriate management oversight to ensure the 
successful implementation of such ethics programs; 
(3) the extent to which the Department of Defense monitors 
or approves the ethics programs of major defense contractors; 
and 
(4) the advantages and disadvantages of legislation 
requiring that defense contractors develop internal ethics pro-
grams and requiring that specific elements be included in such 
ethics programs. 
(c) ACCESS TO INFORMATION.—In accordance with the contract 
clause required pursuant to section 2313(c) of title 10, United 
States Code, each major defense contractor shall provide the Comp-
troller General access to information requested by the Comptroller 
General that is within the scope of the report required by this 
section. 
(d) MAJOR DEFENSE CONTRACTOR DEFINED.—In this section, 
the term ‘‘major defense contractor’’ means any company that was 
awarded contracts by the Department of Defense during fiscal year 
2006 in amounts totaling more than $500,000,000. 
SEC. 849. CONTINGENCY CONTRACTING TRAINING FOR PERSONNEL 
OUTSIDE THE ACQUISITION WORKFORCE AND EVALUA-
TIONS OF ARMY COMMISSION RECOMMENDATIONS. 
(a) TRAINING REQUIREMENT.—Section 2333 of title 10, United 
States Code is amended— 
(1) by redesignating subsection (e) as subsection (f); and 
(2) by inserting after subsection (d) the following new sub-
section (e): 
‘‘(e) 
TRAINING
FOR
PERSONNEL
OUTSIDE
ACQUISITION 
WORKFORCE.—(1) The joint policy for requirements definition, 
contingency program management, and contingency contracting 
required by subsection (a) shall provide for training of military 
personnel outside the acquisition workforce (including operational
H. R. 4986—244 
field commanders and officers performing key staff functions for 
operational field commanders) who are expected to have acquisition 
responsibility, including oversight duties associated with contracts 
or contractors, during combat operations, post-conflict operations, 
and contingency operations. 
‘‘(2) Training under paragraph (1) shall be sufficient to ensure 
that the military personnel referred to in that paragraph under-
stand the scope and scale of contractor support they will experience 
in contingency operations and are prepared for their roles and 
responsibilities with regard to requirements definition, program 
management (including contractor oversight), and contingency con-
tracting. 
‘‘(3) The joint policy shall also provide for the incorporation 
of contractors and contract operations in mission readiness exercises 
for operations that will include contracting and contractor support.’’. 
(b) ORGANIZATIONAL REQUIREMENTS.— 
(1) EVALUATION BY THE SECRETARY OF DEFENSE.—The Sec-
retary of Defense, in consultation with the Chairman of the 
Joint Chiefs of Staff, shall evaluate the recommendations 
included in the report of the Commission on Army Acquisition 
and Program Management in Expeditionary Operations and 
shall determine the extent to which such recommendations 
are applicable to the other Armed Forces. Not later than 120 
days after the date of the enactment of this Act, the Secretary 
of Defense shall submit a report to the congressional defense 
committees with the conclusions of this evaluation and a 
description of the Secretary’s plans for implementing the 
Commission’s recommendations for Armed Forces other than 
the Army. 
(2) EVALUATION BY THE SECRETARY OF THE ARMY.—The 
Secretary of the Army, in consultation with the Chief of Staff 
of the Army, shall evaluate the recommendations included in 
the report of the Commission on Army Acquisition and Program 
Management in Expeditionary Operations. Not later than 120 
days after the date of the enactment of this Act, the Secretary 
of the Army shall submit to the congressional defense commit-
tees a report detailing the Secretary’s plans for implementation 
of the recommendations of the Commission. The report shall 
include the following: 
(A) For each recommendation that has been imple-
mented, or that the Secretary plans to implement— 
(i) a summary of all actions that have been taken 
to implement such recommendation; and 
(ii) a schedule, with specific milestones, for com-
pleting the implementation of such recommendation. 
(B) For each recommendation that the Secretary has 
not implemented and does not plan to implement— 
(i) the reasons for the decision not to implement 
such recommendation; and 
(ii) a summary of any alternative actions the Sec-
retary plans to take to address the purposes underlying 
such recommendation. 
(C) For each recommendation that would require legis-
lation to implement, the Secretary’s recommendations 
regarding such legislation. 
(c) COMPTROLLER GENERAL REPORT.—Section 854(c) of the John 
Warner National Defense Authorization Act for Fiscal Year 2007
H. R. 4986—245 
(Public Law 109–364; 120 Stat. 2346) is amended by adding at 
the end the following new paragraph: 
‘‘(3) COMPTROLLER GENERAL REPORT.—Not later than 180 
days after the date on which the Secretary of Defense submits 
the final report required by paragraph (2), the Comptroller 
General of the United States shall— 
‘‘(A) review the joint policies developed by the Sec-
retary, including the implementation of such policies; and 
‘‘(B) submit to the Committees on Armed Services of 
the Senate and the House of Representatives a report 
on the extent to which such policies, and the implementa-
tion of such policies, comply with the requirements of sec-
tion 2333 of title 10, United States Code (as so amended).’’. 
Subtitle E—Acquisition Workforce 
Provisions 
SEC. 851. REQUIREMENT FOR SECTION ON DEFENSE ACQUISITION 
WORKFORCE IN STRATEGIC HUMAN CAPITAL PLAN. 
(a) IN GENERAL.—In the update of the strategic human capital 
plan for 2008, and in each subsequent update, the Secretary of 
Defense shall include a separate section focused on the defense 
acquisition workforce, including both military and civilian per-
sonnel. 
(b) FUNDING.—The section shall contain— 
(1) an identification of the funding programmed for defense 
acquisition workforce improvements, including a specific identi-
fication of funding provided in the Department of Defense 
Acquisition Workforce Fund established under section 1705 
of title 10, United States Code (as added by section 852 of 
this Act); 
(2) an identification of the funding programmed for defense 
acquisition workforce training in the future-years defense pro-
gram, including a specific identification of funding provided 
by the acquisition workforce training fund established under 
section 37(h)(3) of the Office of Federal Procurement Policy 
Act (41 U.S.C. 433(h)(3)); 
(3) a description of how the funding identified pursuant 
to paragraphs (1) and (2) will be implemented during the fiscal 
year concerned to address the areas of need identified in accord-
ance with subsection (c); 
(4) a statement of whether the funding identified under 
paragraphs (1) and (2) is being fully used; and 
(5) a description of any continuing shortfall in funding 
available for the defense acquisition workforce. 
(c) AREAS OF NEED.—The section also shall identify any areas 
of need in the defense acquisition workforce, including— 
(1) gaps in the skills and competencies of the current 
or projected defense acquisition workforce; 
(2) changes to the types of skills needed in the current 
or projected defense acquisition workforce; 
(3) incentives to retain in the defense acquisition workforce 
qualified, experienced defense acquisition workforce personnel; 
and 
(4) incentives for attracting new, high-quality personnel 
to the defense acquisition workforce.
H. R. 4986—246 
(d) STRATEGIC HUMAN CAPITAL PLAN DEFINED.—In this section, 
the term ‘‘strategic human capital plan’’ means the strategic human 
capital plan required under section 1122 of the National Defense 
Authorization Act for Fiscal Year 2006 (Public Law 109–163; 119 
Stat. 3452; 10 U.S.C. prec. 1580 note). 
SEC. 852. DEPARTMENT OF DEFENSE ACQUISITION WORKFORCE 
DEVELOPMENT FUND. 
(a) IN GENERAL.— 
(1) ESTABLISHMENT
OF
FUND.—Chapter 87 of title 10, 
United States Code, is amended by inserting after section 1704 
the following new section: 
‘‘§ 1705. Department of Defense Acquisition Workforce 
Development Fund 
‘‘(a) ESTABLISHMENT.—The Secretary of Defense shall establish 
a fund to be known as the ‘Department of Defense Acquisition 
Workforce Fund’ (in this section referred to as the ‘Fund’) to provide 
funds, in addition to other funds that may be available, for the 
recruitment, training, and retention of acquisition personnel of the 
Department of Defense. 
‘‘(b) PURPOSE.—The purpose of the Fund is to ensure that 
the Department of Defense acquisition workforce has the capacity, 
in both personnel and skills, needed to properly perform its mission, 
provide appropriate oversight of contractor performance, and ensure 
that the Department receives the best value for the expenditure 
of public resources. 
‘‘(c) MANAGEMENT.—The Fund shall be managed by a senior 
official of the Department of Defense designated by the Under 
Secretary of Defense for Acquisition, Technology, and Logistics for 
that purpose, from among persons with an extensive background 
in management relating to acquisition and personnel. 
‘‘(d) ELEMENTS.— 
‘‘(1) IN GENERAL.—The Fund shall consist of amounts as 
follows: 
‘‘(A) Amounts credited to the Fund under paragraph 
(2). 
‘‘(B) Any other amounts appropriated to, credited to, 
or deposited into the Fund by law. 
‘‘(2) CREDITS TO THE FUND.—(A) There shall be credited 
to the Fund an amount equal to the applicable percentage 
for a fiscal year of all amounts expended by the Department 
of Defense in such fiscal year for contract services, other than 
services relating to research and development and services 
relating to military construction. 
‘‘(B) Not later than 30 days after the end of the third 
fiscal year quarter of fiscal year 2008, and 30 days after the 
end of each fiscal year quarter thereafter, the head of each 
military department and Defense Agency shall remit to the 
Secretary of Defense an amount equal to the applicable percent-
age for such fiscal year of the amount expended by such military 
department or Defense Agency, as the case may be, during 
such fiscal year quarter for services covered by subparagraph 
(A). Any amount so remitted shall be credited to the Fund 
under subparagraph (A). 
‘‘(C) For purposes of this paragraph, the applicable percent-
age for a fiscal year is a percentage as follows:
H. R. 4986—247 
‘‘(i) For fiscal year 2008, 0.5 percent. 
‘‘(ii) For fiscal year 2009, 1 percent. 
‘‘(iii) For fiscal year 2010, 1.5 percent. 
‘‘(iv) For any fiscal year after fiscal year 2010, 2 per-
cent. 
‘‘(D) The Secretary of Defense may reduce a percentage 
established in subparagraph (C) for any fiscal year, if he deter-
mines that the application of such percentage would result 
in the crediting of an amount greater than is reasonably needed 
for the purpose of the Fund. In no event may the Secretary 
reduce a percentage for any fiscal year below a percentage 
that results in the deposit in a fiscal year of an amount equal 
to the following: 
‘‘(i) For fiscal year 2008, $300,000,000. 
‘‘(ii) For fiscal year 2009, $400,000,000. 
‘‘(iii) For fiscal year 2010, $500,000,000. 
‘‘(iv) For any fiscal year after fiscal year 2010, 
$600,000,000. 
‘‘(e) AVAILABILITY OF FUNDS.— 
‘‘(1) IN GENERAL.—Subject to the provisions of this sub-
section, amounts in the Fund shall be available to the Secretary 
of Defense for expenditure, or for transfer to a military depart-
ment or Defense Agency, for the recruitment, training, and 
retention of acquisition personnel of the Department of Defense 
for the purpose of the Fund, including for the provision of 
training and retention incentives to the acquisition workforce 
of the Department. 
‘‘(2) PROHIBITION.—Amounts in the Fund may not be obli-
gated for any purpose other than purposes described in para-
graph (1) or otherwise in accordance with this subsection. 
‘‘(3) GUIDANCE.—The Under Secretary of Defense for 
Acquisition, Technology, and Logistics, acting through the 
senior official designated to manage the Fund, shall issue guid-
ance for the administration of the Fund. Such guidance shall 
include provisions— 
‘‘(A) identifying areas of need in the acquisition 
workforce for which amounts in the Fund may be used, 
including— 
‘‘(i) changes to the types of skills needed in the 
acquisition workforce; 
‘‘(ii) incentives to retain in the acquisition 
workforce qualified, experienced acquisition workforce 
personnel; and 
‘‘(iii) incentives for attracting new, high-quality 
personnel to the acquisition workforce; 
‘‘(B) describing the manner and timing for applications 
for amounts in the Fund to be submitted; 
‘‘(C) describing the evaluation criteria to be used for 
approving or prioritizing applications for amounts in the 
Fund in any fiscal year; and 
‘‘(D) describing measurable objectives of performance 
for determining whether amounts in the Fund are being 
used in compliance with this section. 
‘‘(4) LIMITATION ON PAYMENTS TO OR FOR CONTRACTORS.— 
Amounts in the Fund shall not be available for payments
H. R. 4986—248 
to contractors or contractor employees, other than for the pur-
pose of providing advanced training to Department of Defense 
employees. 
‘‘(5) PROHIBITION ON PAYMENT OF BASE SALARY OF CURRENT 
EMPLOYEES.—Amounts in the Fund may not be used to pay 
the base salary of any person who was an employee of the 
Department as of the date of the enactment of the National 
Defense Authorization Act for Fiscal Year 2008. 
‘‘(6) DURATION OF AVAILABILITY.—Amounts credited to the 
Fund under subsection (d)(2) shall remain available for expendi-
ture in the fiscal year for which credited and the two succeeding 
fiscal years. 
‘‘(f) ANNUAL REPORT.—Not later than 60 days after the end 
of each fiscal year beginning with fiscal year 2008, the Secretary 
of Defense shall submit to the congressional defense committees 
a report on the operation of the Fund during such fiscal year. 
Each report shall include, for the fiscal year covered by such report, 
the following: 
‘‘(1) A statement of the amounts remitted to the Secretary 
for crediting to the Fund for such fiscal year by each military 
department and Defense Agency, and a statement of the 
amounts credited to the Fund for such fiscal year. 
‘‘(2) A description of the expenditures made from the Fund 
(including expenditures following a transfer of amounts in the 
Fund to a military department or Defense Agency) in such 
fiscal year, including the purpose of such expenditures. 
‘‘(3) A description and assessment of improvements in the 
Department of Defense acquisition workforce resulting from 
such expenditures. 
‘‘(4) Recommendations for additional authorities to fulfill 
the purpose of the Fund. 
‘‘(5) A statement of the balance remaining in the Fund 
at the end of such fiscal year. 
‘‘(g) ACQUISITION WORKFORCE DEFINED.—In this section, the 
term ‘acquisition workforce’ means personnel in positions designated 
under section 1721 of this title as acquisition positions for purposes 
of this chapter.’’. 
(2) CLERICAL AMENDMENT.—The table of sections at the 
beginning of subchapter I of such chapter is amended by 
inserting after the item relating to section 1704 the following 
new item: 
‘‘1705. Department of Defense Acquisition Workforce Development Fund.’’. 
(b) EFFECTIVE DATE.—Section 1705 of title 10, United States 
Code, as added by subsection (a), shall take effect on the date 
of the enactment of this Act. 
SEC. 853. EXTENSION OF AUTHORITY TO FILL SHORTAGE CATEGORY 
POSITIONS FOR CERTAIN FEDERAL ACQUISITION POSI-
TIONS. 
Section 1413(b) of the National Defense Authorization Act for 
Fiscal Year 2004 (Public Law 108–136; 117 Stat. 1665) is amended 
by striking ‘‘September 30, 2007’’ and inserting ‘‘September 30, 
2012’’.
H. R. 4986—249 
SEC. 854. REPEAL OF SUNSET OF ACQUISITION WORKFORCE TRAINING 
FUND. 
Section 37(h)(3) of the Office of Federal Procurement Policy 
Act (41 U.S.C. 433(h)(3)) is amended by striking subparagraph 
(H). 
SEC. 855. FEDERAL ACQUISITION WORKFORCE IMPROVEMENTS. 
(a) ASSOCIATE ADMINISTRATOR FOR ACQUISITION WORKFORCE 
PROGRAMS.—The Administrator for Federal Procurement Policy 
shall designate a member of the Senior Executive Service as the 
Associate Administrator for Acquisition Workforce Programs. The 
Associate Administrator for Acquisition Workforce Programs shall 
be located in the Federal Acquisition Institute (or its successor). 
The Associate Administrator shall be responsible for— 
(1) supervising the acquisition workforce training fund 
established under section 37(h)(3) of the Office of Federal 
Procurement Policy Act (41 U. S. C. 433(h)(3)); 
(2) developing, in coordination with Chief Acquisition Offi-
cers and Chief Human Capital Officers, a strategic human 
capital plan for the acquisition workforce of the Federal Govern-
ment; 
(3) reviewing and providing input to individual agency 
acquisition workforce succession plans; 
(4) recommending to the Administrator and other senior 
government officials appropriate programs, policies, and prac-
tices to increase the quantity and quality of the Federal acquisi-
tion workforce; and 
(5) carrying out such other functions as the Administrator 
may assign. 
(b) ACQUISITION AND CONTRACTING TRAINING PROGRAMS WITHIN 
EXECUTIVE AGENCIES.— 
(1) REQUIREMENT.—The head of each executive agency, 
after consultation with the Associate Administrator for Acquisi-
tion Workforce Programs, shall establish and operate acquisi-
tion and contracting training programs. Such programs shall— 
(A) have curricula covering a broad range of acquisition 
and contracting disciplines corresponding to the specific 
acquisition and contracting needs of the agency involved; 
(B) be developed and applied according to rigorous 
standards; and 
(C) be designed to maximize efficiency, through the 
use of self-paced courses, online courses, on-the-job 
training, and the use of remote instructors, wherever such 
features can be applied without reducing the effectiveness 
of the training or negatively affecting academic standards. 
(2) CHIEF ACQUISITION OFFICER AUTHORITIES AND RESPON-
SIBILITIES.—Subject to the authority, direction, and control of 
the head of an executive agency, the Chief Acquisition Officer 
for such agency shall carry out all powers, functions, and duties 
of the head of the agency with respect to implementation of 
this subsection. The Chief Acquisition Officer shall ensure that 
the policies established by the head of the agency in accordance 
with this subsection are implemented throughout the agency. 
(c) 
GOVERNMENT-WIDE
POLICIES
AND
EVALUATION.—The 
Administrator for Federal Procurement Policy shall issue policies 
to promote the development of performance standards for training 
and uniform implementation of this section by executive agencies,
H. R. 4986—250 
with due regard for differences in program requirements among 
agencies that may be appropriate and warranted in view of the 
agency mission. The Administrator shall evaluate the implementa-
tion of the provisions of subsection (b) by executive agencies. 
(d) ACQUISITION AND CONTRACTING TRAINING REPORTING.—The 
Administrator for Federal Procurement Policy shall ensure that 
the heads of executive agencies collect and maintain standardized 
information on the acquisition and contracting workforce related 
to the implementation of subsection (b). 
(e) ACQUISITION
WORKFORCE
HUMAN
CAPITAL
SUCCESSION 
PLAN.— 
(1) IN
GENERAL.—Not later than 1 year after the date 
of the enactment of this Act, each Chief Acquisition Officer 
for an executive agency shall develop, in consultation with 
the Chief Human Capital Officer for the agency and the Asso-
ciate Administrator for Acquisition Workforce Programs, a 
succession plan consistent with the agency’s strategic human 
capital plan for the recruitment, development, and retention 
of the agency’s acquisition workforce, with a particular focus 
on warranted contracting officers and program managers of 
the agency. 
(2) CONTENT OF PLAN.—The acquisition workforce succes-
sion plan shall address— 
(A) recruitment goals for personnel from procurement 
intern programs; 
(B) the agency’s acquisition workforce training needs; 
(C) actions to retain high performing acquisition profes-
sionals who possess critical relevant skills; 
(D) recruitment goals for personnel from the Federal 
Career Intern Program; and 
(E) recruitment goals for personnel from the Presi-
dential Management Fellows Program. 
(f) 
TRAINING
IN
THE
ACQUISITION
OF
ARCHITECT
AND 
ENGINEERING SERVICES.—The Administrator for Federal Procure-
ment Policy shall ensure that a sufficient number of Federal 
employees are trained in the acquisition of architect and engineering 
services. 
(g) UTILIZATION OF RECRUITMENT AND RETENTION AUTHORI-
TIES.—The Administrator for Federal Procurement Policy, in 
coordination with the Director of the Office of Personnel Manage-
ment, shall encourage executive agencies to utilize existing authori-
ties, including direct hire authority and tuition assistance programs, 
to recruit and retain acquisition personnel and consider recruiting 
acquisition personnel who may be retiring from the private sector, 
consistent with existing laws and regulations. 
(h) DEFINITIONS.—In this section: 
(1) EXECUTIVE AGENCY.—The term ‘‘executive agency’’ has 
the meaning provided in section 4(1) of the Office of Federal 
Procurement Policy Act (41 U.S.C. 403(1)). 
(2) CHIEF ACQUISITION OFFICER.—The term ‘‘Chief Acquisi-
tion Officer’’ means a Chief Acquisition Officer for an executive 
agency appointed pursuant to section 16 of the Office of Federal 
Procurement Policy Act (41 U.S.C. 414).
H. R. 4986—251 
Subtitle F—Contracts in Iraq and 
Afghanistan 
SEC. 861. MEMORANDUM OF UNDERSTANDING ON MATTERS RELATING 
TO CONTRACTING. 
(a) MEMORANDUM
OF UNDERSTANDING REQUIRED.—The Sec-
retary of Defense, the Secretary of State, and the Administrator 
of the United States Agency for International Development shall, 
not later than July 1, 2008, enter into a memorandum of under-
standing regarding matters relating to contracting for contracts 
in Iraq or Afghanistan. 
(b) MATTERS COVERED.—The memorandum of understanding 
required by subsection (a) shall address, at a minimum, the fol-
lowing: 
(1) Identification of the major categories of contracts in 
Iraq or Afghanistan being awarded by the Department of 
Defense, the Department of State, or the United States Agency 
for International Development. 
(2) Identification of the roles and responsibilities of each 
department or agency for matters relating to contracting for 
contracts in Iraq or Afghanistan. 
(3) Responsibility for establishing procedures for, and the 
coordination of, movement of contractor personnel in Iraq or 
Afghanistan. 
(4) Identification of common databases that will serve as 
repositories of information on contracts in Iraq or Afghanistan 
and contractor personnel in Iraq or Afghanistan, including 
agreement on the elements to be included in the databases, 
including, at a minimum— 
(A) with respect to each contract— 
(i) a brief description of the contract (to the extent 
consistent with security considerations); 
(ii) the total value of the contract; and 
(iii) whether the contract was awarded competi-
tively; and 
(B) with respect to contractor personnel— 
(i) the total number of personnel employed on con-
tracts in Iraq or Afghanistan; 
(ii) the total number of personnel performing secu-
rity functions under contracts in Iraq or Afghanistan; 
and 
(iii) the total number of personnel working under 
contracts in Iraq or Afghanistan who have been killed 
or wounded. 
(5) Responsibility for maintaining and updating information 
in the common databases identified under paragraph (4). 
(6) Responsibility for the collection and referral to the 
appropriate Government agency of any information relating 
to offenses under chapter 47 of title 10, United States Code 
(the Uniform Code of Military Justice) or chapter 212 of title 
18, United States Code (commonly referred to as the Military 
Extraterritorial Jurisdiction Act), including a clarification of 
responsibilities under section 802(a)(10) of title 10, United 
States Code (article 2(a) of the Uniform Code of Military Jus-
tice), as amended by section 552 of the John Warner National
H. R. 4986—252 
Defense Authorization Act for Fiscal Year 2007 (Public Law 
109–364). 
(c) IMPLEMENTATION OF MEMORANDUM OF UNDERSTANDING.— 
Not later than 120 days after the memorandum of understanding 
required by subsection (a) is signed, the Secretary of Defense, 
the Secretary of State, and the Administrator of the United States 
Agency for International Development shall issue such policies or 
guidance and prescribe such regulations as are necessary to imple-
ment the memorandum of understanding for the relevant matters 
pertaining to their respective agencies. 
(d) COPIES PROVIDED TO CONGRESS.— 
(1) MEMORANDUM
OF
UNDERSTANDING.—Copies of the 
memorandum of understanding required by subsection (a) shall 
be provided to the relevant committees of Congress within 
30 days after the memorandum is signed. 
(2) REPORT ON IMPLEMENTATION.—Not later than 180 days 
after the memorandum of understanding required by subsection 
(a) is signed, the Secretary of Defense, the Secretary of State, 
and the Administrator of the United States Agency for Inter-
national Development shall each provide a report to the rel-
evant committees of Congress on the implementation of the 
memorandum of understanding. 
(3) DATABASES.—The Secretary of Defense, the Secretary 
of State, or the Administrator of the United States Agency 
for International Development shall provide access to the 
common databases identified under subsection (b)(4) to the 
relevant committees of Congress. 
(4) CONTRACTS.—Effective on the date of the enactment 
of this Act, copies of any contracts in Iraq or Afghanistan 
awarded after December 1, 2007, shall be provided to any 
of the relevant committees of Congress within 15 days after 
the submission of a request for such contract or contracts 
from such committee to the department or agency managing 
the contract. 
SEC. 862. CONTRACTORS PERFORMING PRIVATE SECURITY FUNC-
TIONS IN AREAS OF COMBAT OPERATIONS. 
(a) REGULATIONS ON CONTRACTORS PERFORMING PRIVATE SECU-
RITY FUNCTIONS.— 
(1) IN GENERAL.—Not later than 120 days after the date 
of the enactment of this Act, the Secretary of Defense, in 
coordination with the Secretary of State, shall prescribe regula-
tions on the selection, training, equipping, and conduct of per-
sonnel performing private security functions under a covered 
contract in an area of combat operations. 
(2) ELEMENTS.—The regulations prescribed under sub-
section (a) shall, at a minimum, establish— 
(A) a process for registering, processing, accounting 
for, and keeping appropriate records of personnel per-
forming private security functions in an area of combat 
operations; 
(B) a process for authorizing and accounting for 
weapons to be carried by, or available to be used by, per-
sonnel performing private security functions in an area 
of combat operations; 
(C) a process for the registration and identification 
of armored vehicles, helicopters, and other military vehicles
H. R. 4986—253 
operated by contractors performing private security func-
tions in an area of combat operations; 
(D) a process under which contractors are required 
to report all incidents, and persons other than contractors 
are permitted to report incidents, in which— 
(i) a weapon is discharged by personnel performing 
private security functions in an area of combat oper-
ations; 
(ii) personnel performing private security functions 
in an area of combat operations are killed or injured; 
or 
(iii) persons are killed or injured, or property is 
destroyed, as a result of conduct by contractor per-
sonnel; 
(E) a process for the independent review and, if prac-
ticable, investigation of— 
(i) incidents reported pursuant to subparagraph 
(D); and 
(ii) incidents of alleged misconduct by personnel 
performing private security functions in an area of 
combat operations; 
(F) requirements for qualification, training, screening 
(including, if practicable, through background checks), and 
security for personnel performing private security functions 
in an area of combat operations; 
(G) guidance to the commanders of the combatant com-
mands on the issuance of— 
(i) orders, directives, and instructions to contrac-
tors performing private security functions relating to 
equipment, force protection, security, health, safety, 
or relations and interaction with locals; 
(ii) predeployment training requirements for per-
sonnel performing private security functions in an area 
of combat operations, addressing the requirements of 
this section, resources and assistance available to con-
tractor personnel, country information and cultural 
training, and guidance on working with host country 
nationals and military; and 
(iii) rules on the use of force for personnel per-
forming private security functions in an area of combat 
operations; 
(H) a process by which a commander of a combatant 
command may request an action described in subsection 
(b)(3); and 
(I) a process by which the training requirements 
referred to in subparagraph (G)(ii) shall be implemented. 
(3) AVAILABILITY
OF
ORDERS, DIRECTIVES, AND
INSTRUC-
TIONS.—The regulations prescribed under subsection (a) shall 
include mechanisms to ensure the provision and availability 
of the orders, directives, and instructions referred to in para-
graph (2)(G)(i) to contractors referred to in that paragraph, 
including through the maintenance of a single location 
(including an Internet website, to the extent consistent with 
security considerations) at or through which such contractors 
may access such orders, directives, and instructions. 
(b) CONTRACT CLAUSE ON CONTRACTORS PERFORMING PRIVATE 
SECURITY FUNCTIONS.—
H. R. 4986—255 
(iv) rules on the use of force issued by the 
applicable commander of a combatant command for 
personnel performing private security functions in an 
area of combat operations; and 
(C) cooperate with any investigation conducted by the 
Department of Defense pursuant to subsection (a)(2)(E) 
by providing access to employees of the contractor and 
relevant information in the possession of the contractor 
regarding the incident concerned. 
(3) NONCOMPLIANCE OF PERSONNEL WITH CLAUSE.—The con-
tracting officer for a covered contract may direct the contractor, 
at its own expense, to remove or replace any personnel per-
forming private security functions in an area of combat oper-
ations who violate or fail to comply with applicable require-
ments of the clause required by this subsection. If the violation 
or failure to comply is a gross violation or failure or is repeated, 
the contract may be terminated for default. 
(4) APPLICABILITY.—The contract clause required by this 
subsection shall be included in all covered contracts awarded 
on or after the date that is 180 days after the date of the 
enactment of this Act. Federal agencies shall make best efforts 
to provide for the inclusion of the contract clause required 
by this subsection in covered contracts awarded before such 
date. 
(5) INSPECTOR
GENERAL
REPORT
ON
PILOT
PROGRAM
ON 
IMPOSITION OF FINES FOR NONCOMPLIANCE OF PERSONNEL WITH 
CLAUSE.—Not later than March 30, 2008, the Inspector General 
of the Department of Defense shall submit to Congress a report 
assessing the feasibility and advisability of carrying out a pilot 
program for the imposition of fines on contractors for personnel 
who violate or fail to comply with applicable requirements 
of the clause required by this section as a mechanism for 
enhancing the compliance of such personnel with the clause. 
The report shall include— 
(A) an assessment of the feasibility and advisability 
of carrying out the pilot program; and 
(B) if the Inspector General determines that carrying 
out the pilot program is feasible and advisable— 
(i) recommendations on the range of contracts and 
subcontracts to which the pilot program should apply; 
and 
(ii) a schedule of fines to be imposed under the 
pilot program for various types of personnel actions 
or failures. 
(c) AREAS OF COMBAT OPERATIONS.— 
(1) DESIGNATION.—The Secretary of Defense shall designate 
the areas constituting an area of combat operations for purposes 
of this section by not later than 120 days after the date of 
the enactment of this Act. 
(2) PARTICULAR
AREAS.—Iraq and Afghanistan shall be 
included in the areas designated as an area of combat oper-
ations under paragraph (1). 
(3) ADDITIONAL AREAS.—The Secretary may designate any 
additional area as an area constituting an area of combat 
operations for purposes of this section if the Secretary deter-
mines that the presence or potential of combat operations in
H. R. 4986—256 
such area warrants designation of such area as an area of 
combat operations for purposes of this section. 
(4) MODIFICATION OR ELIMINATION OF DESIGNATION.—The 
Secretary may modify or cease the designation of an area 
under this subsection as an area of combat operations if the 
Secretary determines that combat operations are no longer 
ongoing in such area. 
(d) EXCEPTION.—The requirements of this section shall not 
apply to contracts entered into by elements of the intelligence 
community in support of intelligence activities. 
SEC. 863. COMPTROLLER GENERAL REVIEWS AND REPORTS ON CON-
TRACTING IN IRAQ AND AFGHANISTAN. 
(a) REVIEWS AND REPORTS REQUIRED.— 
(1) IN GENERAL.—Every 12 months, the Comptroller Gen-
eral shall review contracts in Iraq or Afghanistan and submit 
to the relevant committees of Congress a report on such review. 
(2) MATTERS
COVERED.—A report under this subsection 
shall cover the following with respect to the contracts in Iraq 
or Afghanistan reviewed for the report: 
(A) Total number of contracts and task orders awarded 
during the period covered by the report. 
(B) Total number of active contracts and task orders. 
(C) Total value of all contracts and task orders awarded 
during the reporting period. 
(D) Total value of active contracts and task orders. 
(E) The extent to which such contracts have used 
competitive procedures. 
(F) Total number of contractor personnel working on 
contracts during the reporting period. 
(G) Total number of contractor personnel, on average, 
who are performing security functions during the reporting 
period. 
(H) The number of contractor personnel killed or 
wounded during the reporting period. 
(I) Information on any specific contract or class of 
contracts that the Comptroller General determines raises 
issues of significant concern. 
(3) SUBMISSION
OF
REPORTS.—The Comptroller General 
shall submit an initial report under this subsection not later 
than October 1, 2008, and shall submit an updated report 
every year thereafter until October 1, 2010. 
(b) ACCESS TO DATABASES ON CONTRACTS.—The Secretary of 
Defense and the Secretary of State shall provide full access to 
the databases described in section 861(b)(4) to the Comptroller 
General for purposes of the reviews carried out under this section. 
SEC. 864. DEFINITIONS AND OTHER GENERAL PROVISIONS. 
(a) DEFINITIONS.—In this subtitle: 
(1) MATTERS RELATING TO CONTRACTING.—The term ‘‘mat-
ters relating to contracting’’, with respect to contracts in Iraq 
and Afghanistan, means all matters relating to awarding, 
funding, managing, tracking, monitoring, and providing over-
sight to contracts and contractor personnel. 
(2) CONTRACT IN IRAQ OR AFGHANISTAN.—The term ‘‘con-
tract in Iraq or Afghanistan’’ means a contract with the Depart-
ment of Defense, the Department of State, or the United States 
Agency for International Development, a subcontract at any
H. R. 4986—257 
tier issued under such a contract, or a task order or delivery 
order at any tier issued under such a contract (including a 
contract, subcontract, or task order or delivery order issued 
by another Government agency for the Department of Defense, 
the Department of State, or the United States Agency for 
International Development), if the contract, subcontract, or task 
order or delivery order involves worked performed in Iraq or 
Afghanistan for a period longer than 14 days. 
(3) COVERED
CONTRACT.—The term ‘‘covered contract’’ 
means— 
(A) a contract of a Federal agency for the performance 
of services in an area of combat operations, as designated 
by the Secretary of Defense under subsection (c) of section 
862; 
(B) a subcontract at any tier under such a contract; 
or 
(C) a task order or delivery order issued under such 
a contract or subcontract. 
(4) CONTRACTOR.—The term ‘‘contractor’’, with respect to 
a covered contract, means the contractor or subcontractor car-
rying out the covered contract. 
(5) PRIVATE SECURITY FUNCTIONS.—The term ‘‘private secu-
rity functions’’ means activities engaged in by a contractor 
under a covered contract as follows: 
(A) Guarding of personnel, facilities, or property of 
a Federal agency, the contractor or subcontractor, or a 
third party. 
(B) Any other activity for which personnel are required 
to carry weapons in the performance of their duties. 
(6) RELEVANT COMMITTEES OF CONGRESS.—The term ‘‘rel-
evant committees of Congress’’ means each of the following 
committees: 
(A) The Committees on Armed Services of the Senate 
and the House of Representatives. 
(B) The Committee on Homeland Security and Govern-
mental Affairs of the Senate and the Committee on Over-
sight and Government Reform of the House of Representa-
tives. 
(C) The Committee on Foreign Relations of the Senate 
and the Committee on Foreign Affairs of the House of 
Representatives. 
(D) For purposes of contracts relating to the National 
Foreign Intelligence Program, the Select Committee on 
Intelligence of the Senate and the Permanent Select Com-
mittee on Intelligence of the House of Representatives. 
(b) CLASSIFIED INFORMATION.—Nothing in this subtitle shall 
be interpreted to require the handling of classified information 
or information relating to intelligence sources and methods in a 
manner inconsistent with any law, regulation, executive order, or 
rule of the House of Representatives or of the Senate relating 
to the handling or protection of such information.
H. R. 4986—258 
Subtitle G—Defense Materiel Readiness 
Board 
SEC. 871. ESTABLISHMENT OF DEFENSE MATERIEL READINESS 
BOARD. 
(a) ESTABLISHMENT.—Not later than 6 months after the date 
of the enactment of this Act, the Secretary of Defense shall establish 
a Defense Materiel Readiness Board (in this subtitle referred to 
as the ‘‘Board’’) within the Office of the Secretary of Defense. 
(b) MEMBERSHIP.—The Secretary shall appoint the chairman 
and the members of the Board from among officers of the Armed 
Forces with expertise in matters relevant to the function of the 
Board to assess materiel readiness and evaluate plans and policies 
relating to materiel readiness. At a minimum, the Board shall 
include representatives of the Joint Chiefs of Staff, each of the 
Armed Forces, and each of the reserve components of the Armed 
Forces. 
(c) STAFF.—The Secretary of Defense shall assign staff, and 
request the Secretaries of the military departments to assign staff, 
as necessary to assist the Board in carrying out its duties. 
(d) FUNCTIONS.—The Board shall provide independent assess-
ments of materiel readiness, materiel readiness shortfalls, and 
materiel readiness plans to the Secretary of Defense and the Con-
gress. To carry out such functions, the Board shall— 
(1) monitor and assess the materiel readiness of the Armed 
Forces; 
(2) assist the Secretary of Defense in the identification 
of deficiencies in the materiel readiness of the Armed Forces 
caused by shortfalls in weapons systems, equipment, and sup-
plies; 
(3) identify shortfalls in materiel readiness, including crit-
ical materiel readiness shortfalls, for purposes of the Secretary’s 
designations under section 872 and the funding needed to 
address such shortfalls; 
(4) assess the adequacy of current Department of Defense 
plans, policies, and programs to address shortfalls in materiel 
readiness, including critical materiel readiness shortfalls (as 
designated by the Secretary under section 872), and to sustain 
and improve materiel readiness; 
(5) assist the Secretary of Defense in determining whether 
the industrial capacity of the Department of Defense and of 
the defense industrial base is being best utilized to support 
the materiel readiness needs of the Armed Forces; 
(6) review and assess Department of Defense systems for 
measuring the status of current materiel readiness of the 
Armed Forces; and 
(7) make recommendations with respect to materiel readi-
ness funding, measurement techniques, plans, policies, and pro-
grams. 
(e) REPORTS.—The Board shall submit to the Secretary of 
Defense a report summarizing its findings and recommendations 
not less than once every six months. Within 30 days after receiving 
a report from the Board, the Secretary shall forward the report 
in its entirety, together with his comments, to the congressional 
defense committees. The report shall be submitted in unclassified
H. R. 4986—259 
form. To the extent necessary, the report may be accompanied 
by a classified annex. 
SEC. 872. CRITICAL MATERIEL READINESS SHORTFALLS. 
(a) DESIGNATION
OF CRITICAL MATERIEL READINESS SHORT-
FALLS.— 
(1) DESIGNATION.—The Secretary of Defense may designate 
any requirement of the Armed Forces for equipment or supplies 
as a critical materiel readiness shortfall if there is a shortfall 
in the required equipment or supplies that materially reduces 
readiness of the Armed Forces and that— 
(A) cannot be adequately addressed by identifying 
acceptable substitute capabilities or cross leveling of equip-
ment that does not unacceptably reduce the readiness of 
other Armed Forces; and 
(B) that is likely to persist for more than two years 
based on currently projected budgets and schedules for 
deliveries of equipment and supplies. 
(2) CONSIDERATION OF BOARD FINDINGS AND RECOMMENDA-
TIONS.—In making any such designation, the Secretary shall 
take into consideration the findings and recommendations of 
the Defense Materiel Readiness Board. 
(b) MEASURES
TO ADDRESS CRITICAL MATERIEL READINESS 
SHORTFALLS.—The Secretary of Defense shall ensure that critical 
materiel readiness shortfalls designated pursuant to subsection 
(a)(1) are transmitted to the relevant officials of the Department 
of Defense responsible for requirements, budgets, and acquisition, 
and that such officials prioritize and address such shortfalls in 
the shortest time frame practicable. 
(c) TRANSFER AUTHORITY.— 
(1) IN GENERAL.—The amounts of authorizations that the 
Secretary may transfer under the authority of section 1001 
of this Act is hereby increased by $2,000,000,000. 
(2) LIMITATIONS.—The additional transfer authority pro-
vided by this section— 
(A) may be made only from authorizations to the 
Department of Defense for fiscal year 2008; 
(B) may be exercised solely for the purpose of 
addressing critical materiel readiness shortfalls as des-
ignated by the Secretary of Defense under subsection (a); 
and 
(C) is subject to the same terms, conditions, and proce-
dures as other transfer authority under section 1001 of 
this Act. 
(d) STRATEGIC READINESS FUND.— 
(1) ESTABLISHMENT.—There is established on the books 
of the Treasury a fund to be known as the Department of 
Defense Strategic Readiness Fund (in this subsection referred 
to as the ‘‘Fund’’), which shall be administered by the Secretary 
of the Treasury. 
(2) PURPOSES.—The Fund shall be used to address critical 
materiel readiness shortfalls as designated by the Secretary 
of Defense under subsection (a). 
(3) ASSETS OF FUND.—There shall be deposited into the 
Fund any amount appropriated to the Fund, which shall con-
stitute the assets of the Fund.
H. R. 4986—260 
(4) LIMITATION.—The procurement unit cost (as defined 
in section 2432(a) of title 10, United States Code) of any item 
purchased using assets of the Fund, whether such assets are 
in the Fund or after such assets have been transferred from 
the Fund using the authority provided in subsection (c), shall 
not exceed $30,000,000. 
(e) MULTIYEAR CONTRACT NOTIFICATION.— 
(1) NOTIFICATION.—If the Secretary of a military depart-
ment makes the determination described in paragraph (2) with 
respect to the use of a multiyear contract, the Secretary shall 
notify the congressional defense committees within 30 days 
of the determination and provide a detailed description of the 
proposed multiyear contract. 
(2) DETERMINATION.—The determination referred to in 
paragraph (1) is a determination by the Secretary of a military 
department that the use of a multiyear contract to procure 
an item to address a critical materiel readiness shortfall— 
(A) will significantly accelerate efforts to address a 
critical materiel readiness shortfall; 
(B) will provide savings compared to the total antici-
pated costs of carrying out the contract through annual 
contracts; and 
(C) will serve the interest of national security. 
(f) DEFINITION.—In this section, the term ‘‘critical materiel 
readiness shortfall’’ means a critical materiel readiness shortfall 
designated by the Secretary of Defense under this section. 
Subtitle H—Other Matters 
SEC. 881. CLEARINGHOUSE FOR RAPID IDENTIFICATION AND DISSEMI-
NATION 
OF 
COMMERCIAL 
INFORMATION 
TECH-
NOLOGIES. 
(a) REQUIREMENT TO ESTABLISH CLEARINGHOUSE.—Not later 
than 180 days after the date of the enactment of this Act, the 
Secretary of Defense, acting through the Assistant Secretary of 
Defense for Networks and Information Integration, shall establish 
a clearinghouse for identifying, assessing, and disseminating knowl-
edge about readily available information technologies (with an 
emphasis on commercial off-the-shelf information technologies) that 
could support the warfighting mission of the Department of Defense. 
(b) RESPONSIBILITIES.—The clearinghouse established pursuant 
to subsection (a) shall be responsible for the following: 
(1) Developing a process to rapidly assess and set priorities 
and needs for significant information technology needs of the 
Department of Defense that could be met by commercial tech-
nologies, including a process for— 
(A) aligning priorities and needs with the requirements 
of the commanders of the combatant command; and 
(B) proposing recommendations to the commanders of 
the combatant command of feasible technical solutions for 
further evaluation. 
(2) Identifying and assessing emerging commercial tech-
nologies (including commercial off-the-shelf technologies) that 
could support the warfighting mission of the Department of 
Defense, including the priorities and needs identified pursuant 
to paragraph (1).
H. R. 4986—261 
(3) Disseminating information about commercial tech-
nologies identified pursuant to paragraph (2) to commanders 
of combatant commands and other potential users of such tech-
nologies. 
(4) Identifying gaps in commercial technologies and 
working to stimulate investment in research and development 
in the public and private sectors to address those gaps. 
(5) Enhancing internal data and communications systems 
of the Department of Defense for sharing and retaining informa-
tion regarding commercial technology priorities and needs, tech-
nologies available to meet such priorities and needs, and 
ongoing research and development directed toward gaps in 
such technologies. 
(6) Developing mechanisms, including web-based mecha-
nisms, to facilitate communications with industry regarding 
the priorities and needs of the Department of Defense identified 
pursuant to paragraph (1) and commercial technologies avail-
able to address such priorities and needs. 
(7) Assisting in the development of guides to help small 
information technology companies with promising technologies 
to understand and navigate the funding and acquisition proc-
esses of the Department of Defense. 
(8) Developing methods to measure how well processes 
developed by the clearinghouse are being utilized and to collect 
data on an ongoing basis to assess the benefits of commercial 
technologies that are procured on the recommendation of the 
clearinghouse. 
(c) PERSONNEL.—The Secretary of Defense, acting through the 
Assistant Secretary of Defense for Networks and Information 
Integration, shall provide for the hiring and support of employees 
(including detailees from other components of the Department of 
Defense and from other Federal departments or agencies) to assist 
in identifying, assessing, and disseminating information regarding 
commercial technologies under this section. 
(d) REPORT TO CONGRESS.—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 this section. 
SEC. 882. AUTHORITY TO LICENSE CERTAIN MILITARY DESIGNATIONS 
AND LIKENESSES OF WEAPONS SYSTEMS TO TOY AND 
HOBBY MANUFACTURERS. 
(a) AUTHORITY TO LICENSE CERTAIN ITEMS.—Section 2260 of 
title 10, United States Code, is amended— 
(1) by redesignating subsections (c), (d), and (e) as sub-
sections (d), (e), and (f), respectively; and 
(2) by inserting after subsection (b) the following new sub-
section: 
‘‘(c) LICENSES FOR QUALIFYING COMPANIES.—(1) The Secretary 
concerned may license trademarks, service marks, certification 
marks, and collective marks owned or controlled by the Secretary 
relating to military designations and likenesses of military weapons 
systems to any qualifying company upon receipt of a request from 
the company. 
‘‘(2) For purposes of paragraph (1), a qualifying company is 
any United States company that— 
‘‘(A) is a toy or hobby manufacturer; and
H. R. 4986—262 
‘‘(B) is determined by the Secretary concerned to be quali-
fied in accordance with such criteria as determined appropriate 
by the Secretary of Defense. 
‘‘(3) The fee for a license under this subsection shall not exceed 
by more than a nominal amount the amount needed to recover 
all costs of the Department of Defense in processing the request 
for the license and supplying the license. 
‘‘(4) A license to a qualifying company under this subsection 
shall provide that the license may not be transferred, sold, or 
relicensed by the qualifying company. 
‘‘(5) A license under this subsection shall not be an exclusive 
license.’’. 
(b) EFFECTIVE DATE.—The Secretary of Defense shall prescribe 
regulations to implement the amendment made by this section 
not later than 180 days after the date of the enactment of this 
Act. 
SEC. 883. MODIFICATIONS TO LIMITATION ON CONTRACTS TO 
ACQUIRE MILITARY FLIGHT SIMULATOR. 
(a) EFFECT ON EXISTING CONTRACTS.—Section 832 of the John 
Warner National Defense Authorization Act for Fiscal Year 2007 
(Public Law 109–364; 120 Stat. 2331) is amended by adding at 
the end the following new subsection: 
‘‘(e) EFFECT ON EXISTING CONTRACTS.—The limitation in sub-
section (a) does not apply to any service contract of a military 
department to acquire a military flight simulator, or to any renewal 
or extension of, or follow-on contract to, such a contract, if— 
‘‘(1) the contract was in effect as of October 17, 2006; 
‘‘(2) the number of flight simulators to be acquired under 
the contract (or renewal, extension, or follow-on) will not result 
in the total number of flight simulators acquired by the military 
department concerned through service contracts to exceed the 
total number of flight simulators to be acquired under all 
service contracts of such department for such simulators in 
effect as of October 17, 2006; and 
‘‘(3) in the case of a renewal or extension of, or follow- 
on contract to, the contract, the Secretary of the military depart-
ment concerned provides to the congressional defense commit-
tees a written notice of the decision to exercise an option 
to renew or extend the contract, or to issue a solicitation for 
bids or proposals using competitive procedures for a follow- 
on contract, and an economic analysis as described in subsection 
(c) supporting the decision, at least 30 days before carrying 
out such decision.’’. 
(b) CHANGE
IN GROUNDS
FOR WAIVER.—Section 832(c)(1) of 
such Act, as redesignated by subsection (a), is amend by striking 
‘‘necessary for national security purposes’’ and inserting ‘‘in the 
national interest’’. 
SEC. 884. REQUIREMENTS RELATING TO WAIVERS OF CERTAIN 
DOMESTIC SOURCE LIMITATIONS RELATING TO SPE-
CIALTY METALS. 
(a) NOTICE REQUIREMENT.—At least 30 days prior to making 
a domestic nonavailability determination pursuant to section 
2533b(b) of title 10, United States Code, that would apply to more 
than one contract of the Department of Defense, the Secretary 
of Defense shall, to the maximum extent practicable and in a
H. R. 4986—263 
manner consistent with the protection of national security informa-
tion and confidential business information— 
(1) publish a notice on the website maintained by the 
General Services Administration known as FedBizOpps.gov (or 
any successor site) of the Secretary’s intent to make the 
domestic nonavailability determination; and 
(2) solicit information relevant to such notice from 
interested parties, including producers of specialty metal mill 
products. 
(b) DETERMINATION.—(1) The Secretary shall take into consider-
ation all information submitted pursuant to subsection (a) in 
making a domestic nonavailability determination pursuant to sec-
tion 2533b(b) of title 10, United States Code, that would apply 
to more than one contract of the Department of Defense, and 
may also consider other relevant information that cannot be made 
part of the public record consistent with the protection of national 
security information and confidential business information. 
(2) The Secretary shall ensure that any such determination 
and the rationale for such determination is made publicly available 
to the maximum extent consistent with the protection of national 
security information and confidential business information. 
SEC. 885. TELEPHONE SERVICES FOR MILITARY PERSONNEL SERVING 
IN COMBAT ZONES. 
(a) COMPETITIVE PROCEDURES REQUIRED.— 
(1) REQUIREMENT.—When the Secretary of Defense con-
siders it necessary to provide morale, welfare, and recreation 
telephone services for military personnel serving in combat 
zones, the Secretary shall use competitive procedures when 
entering into a contract to provide those services. 
(2) REVIEW AND DETERMINATION.—Before soliciting bids or 
proposals for new contracts, or considering extensions to 
existing contracts, to provide morale, welfare, and recreation 
telephone services for military personnel serving in combat 
zones, the Secretary shall review and determine whether it 
is in the best interest of the Department to require bids or 
proposals, or adjustments for the purpose of extending a con-
tract, to include options that minimize the cost of the telephone 
services to individual users while providing individual users 
the flexibility of using phone cards from other than the prospec-
tive contractor. The Secretary shall submit the results of this 
review and determination to the Committees on Armed Services 
of the Senate and the House of Representatives. 
(b) EFFECTIVE DATE.— 
(1) REQUIREMENT.—Subsection (a)(1) shall apply to any 
new contract to provide morale, welfare, and recreation tele-
phone services for military personnel serving in combat zones 
that is entered into after the date of the enactment of this 
Act. 
(2) REVIEW AND DETERMINATION.—Subsection (a)(2) shall 
apply to any new contract or extension to an existing contract 
to provide morale, welfare, and recreation telephone services 
for military personnel serving in combat zones that is entered 
into or agreed upon after the date of the enactment of this 
Act.
H. R. 4986—597 
(1) Chapters 513 and 515 are amended by striking ‘‘Naval 
Reserve’’ each place it appears in analyses, headings, and text 
and inserting ‘‘Navy Reserve’’. 
(2) Section 51504(f) is amended to read as follows: 
‘‘(f) FUEL COSTS.— 
‘‘(1) IN GENERAL.—Subject to the availability of appropria-
tions, the Secretary shall pay to each State maritime academy 
the costs of fuel used by a vessel provided under this section 
while used for training. 
‘‘(2) MAXIMUM AMOUNTS.—The amount of the payment to 
a State maritime academy under paragraph (1) may not 
exceed— 
‘‘(A) $100,000 for fiscal year 2006; 
‘‘(B) $200,000 for fiscal year 2007; and 
‘‘(C) $300,000 for fiscal year 2008 and each fiscal year 
thereafter.’’. 
(3) 
Section 
51505(b)(2)(B) 
is 
amended 
by 
striking 
‘‘$200,000’’ and inserting ‘‘$300,000 for fiscal year 2006, 
$400,000 for fiscal year 2007, and $500,000 for fiscal year 
2008 and each fiscal year thereafter’’. 
(4) Section 51701(a) is amended by striking ‘‘of the United 
States.’’ and inserting ‘‘of the United States and to perform 
functions to assist the United States merchant marine, as deter-
mined necessary by the Secretary.’’. 
(5)(A) Section 51907 is amended to read as follows: 
‘‘§ 51907. Provision of decorations, medals, and replacements 
‘‘The Secretary of Transportation may provide— 
‘‘(1) the decorations and medals authorized by this chapter 
and replacements for those decorations and medals; and 
‘‘(2) replacements for decorations and medals issued under 
a prior law.’’. 
(B) The item relating to section 51907 in the chapter anal-
ysis for chapter 519 is amended to read as follows: 
‘‘51907. Provision of decorations, medals, and replacements’’. 
(6)(A) The following new chapter is inserted after chapter 
539: 
‘‘CHAPTER 541—MISCELLANEOUS 
‘‘Sec 
‘‘54101. Assistance for small shipyards and maritime communities’’. 
(B) Section 3506 of the National Defense Authorization 
Act for Fiscal Year 2006 (46 U.S.C. 53101 note) is transferred 
to and redesignated as section 54101 of title 46, United States 
Code, to appear at the end of chapter 541 of title 46, as 
inserted by subparagraph (A). 
(C) The heading of such section, as transferred by subpara-
graph (B), is amended to read as follows: 
‘‘§ 54101. Assistance for small shipyards and maritime 
communities’’. 
(D) Paragraph (1) of subsection (h) of such section, as 
transferred by subparagraph (B), is amended by striking ‘‘(15 
U.S.C. 632);’’ and inserting ‘‘(15 U.S.C. 632));’’.