I
103D CONGRESS
1ST SESSION
H. R. 2498
To assist community, business, and worker readjustment required as a result
of the closure of military installations and reductions in defense spending,
and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JUNE 23, 1993
Mr. GOODLING introduced the following bill; which was referred jointly to the
Committees on Armed Services, Education and Labor, Banking, Finance
and Urban Affairs, Public Works and Transportation, and Small Busi-
ness
A BILL
To assist community, business, and worker readjustment re-
quired as a result of the closure of military installations
and reductions in defense spending, and for other pur-
poses.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Defense Diversification
and Community Adjustment Act of 1993’’.
SEC. 2. TABLE OF CONTENTS.
The table of contents is as follows:
Sec. 1. Short title.
fense contractor to provide material or defense-relat-
ed operations.
(7) The term ‘‘defense subcontractor’’ means
any facility engaged in the furnishing of defense ma-
terial pursuant to the terms of a defense sub-
contract.
(8) The term ‘‘military installation’’ means a
base, camp, post, station, yard, center, or homeport
facility for any ship in the United States, or any
other facility under the jurisdiction of a military de-
partment located in the United States.
(9) The term ‘‘qualified small business’’ means
a small business concern that—
(A) employs less than 500 workers;
(B) is independently owned and operated;
(C) derives at least 25 percent of its gross
revenues from defense contracts or sub-
contracts; and
(D) can demonstrate that—
(i) it has either experienced or will ex-
perience the loss of a defense contract or
subcontract causing significant reductions
in the volume of defense-related work in
relation to the total defense work in such
facility; or
(ii) the loss of a defense facility, con-
tractor, subcontractor will substantially
and seriously affect its business.
(10) The term ‘‘substantially and seriously af-
fected community’’ means a community—
(A) which has within its administrative
and political jurisdiction 1 or more military in-
stallations or defense facilities or which is eco-
nomically affected by proximity to a military in-
stallation or defense facility;
(B) in which the actual or threatened cur-
tailment, completion, elimination, or realign-
ment of a defense contract results in a
workforce reduction of—
(i) 2,500 or more employee positions,
in the case of a Primary Metropolitan Sta-
tistical Area or similar area (as defined by
the Director of the Office of Management
and Budget);
(ii) 500 or more employee positions,
in the case of a Metropolitan Statistical
Area or similar area (as defined by the Di-
rector of the Office of Management and
Budget);
(iii) 250 or more employee positions,
in the case of a labor market area outside
of a Metropolitan Statistical Area; or
(iv) one percent of the total number of
civilian jobs in that area; and
(C) which establishes, by evidence, that
any workforce reduction referred to in subpara-
graph (B) occurred as a direct result of changes
in Department of Defense requirements or pro-
grams.
(11) The term ‘‘substantially and seriously af-
fected business’’ means a defense contractor or de-
fense subcontractor which—
(A) experiences a reduction, or the threat
of a reduction, of—
(i) 25 percent or more in sales or pro-
duction; or
(ii) 80 percent or more of the
workforce of such business in any division
of such business or at any plant or other
facility of such business; and
(B) establishes, by evidence, that the re-
ductions referred to in subparagraph (A) oc-
curred as a direct result of a reduction in the
defense budget.
SEC. 102. ASSISTANT SECRETARY OF DEFENSE FOR ECO-
NOMIC ADJUSTMENT.
(a) DESIGNATION OF ASSISTANT SECRETARY.—Sub-
section (b) of section 136 of title 10, United States Code,
is amended by adding at the end the following new
paragraph:
‘‘(5)(A) One of the Assistant Secretaries shall be the
Assistant Secretary of Defense for Economic Adjustment
who shall be responsible to the Secretary of Defense for
the economic conversion program of the United States, in-
cluding—
‘‘(i) assessment of defense economic adjustment
problems;
‘‘(ii) consultation with States and communities
adversely affected by reductions in defense spending,
the completion or termination of a defense contract
or subcontract, or the closure or realignment of a
military installation;
‘‘(iii) development of measures to relieve such
adverse effects; and
‘‘(iv) provision of assistance to such States and
communities for conversion and adjustment pur-
poses.
‘‘(B) The Assistant Secretary shall serve as the head
of the Office of Economic Adjustment of the Department
of Defense and shall supervise the activities of four direc-
tors, to be appointed by the Secretary of Defense, in the
following areas:
‘‘(i) Community assistance.
‘‘(ii) Economic diversification and adjustment.
‘‘(iii) Assistance for dislocated workers.
‘‘(iv) Coordination and informational activi-
ties.’’.
(b) INCREASE IN NUMBER OF ASSISTANT SECRETAR-
IES.—(1) Subsection (a) of such section is amended by
striking out ‘‘eleven’’ and inserting in lieu thereof
‘‘twelve’’.
(2) Section 5315 of title 5, United States Code, is
amended by striking out ‘‘Assistant Secretaries of Defense
(11).’’ and inserting in lieu thereof ‘‘Assistant Secretaries
of Defense (12).’’
SEC. 103. COMMUNITY ASSISTANCE GRANTS THROUGH THE
DEPARTMENT OF DEFENSE.
(a) COMMUNITY ADJUSTMENT PLAN.—The Assistant
Secretary of Defense for Economic Adjustment shall facili-
tate the development of a community adjustment plan for
each substantially and seriously affected community by
members of that community to reduce the adverse effects
of defense downsizing. The Assistant Secretary shall carry
out this section through the Director of Community As-
sistance appointed under section 136(b)(5) of title 10,
United States Code.
(b) COMMUNITY ADJUSTMENT COMMITTEES.—
(1) IN GENERAL.—The Director shall facilitate
and aid in the formation of a community adjustment
committee for each substantially and seriously af-
fected community. Except as provided in paragraph
(2), to receive assistance under this subsection, a
community adjustment committee must contain the
following members:
(A) At least 3 representatives from the
management of defense facilities in the commu-
nity.
(B) At least 3 representatives of employees
of defense facilities in the community.
(C) At least 3 representatives of the local
government of the community.
(D) At least 3 representatives of non-
governmental leaders in the community.
(2) EXISTING COMMUNITY ADJUSTMENT COM-
MITTEE.—The requirement described in the second
sentence of paragraph (1) shall not apply in the case
of a community adjustment committee which is in
existence as of the date of the enactment of this sub-
section.
(c) TECHNICAL ASSISTANCE FOR COMMITTEES.—(1)
Grants and assistance may be made available following the
formation of a community adjustment committee for the
purpose of providing the committee with technical assist-
ance. A grant may be made—
(A) to provide for a business expert to examine
the potential market needs of the region in which
the community is located to identify economic ad-
justment and conversion opportunities for defense
facilities in the community; and
(B) to provide for a technological expert to de-
termine the feasibility of various adjustment and
conversion alternatives for defense facilities in the
community.
(2) Grants and other assistance under this subsection
may not exceed $100,000 per community adjustment com-
mittee.
(d) ECONOMIC DEVELOPMENT GRANTS.—(1) A sub-
stantially and seriously affected community that has a
community adjustment committee and has developed and
is ready to implement a community adjustment plan ap-
proved by the Director shall be eligible for grants under
this subsection.
(2) A grant under this subsection may be used to im-
plement a community adjustment plan to relieve the stress
caused upon a community as a result of defense
downsizing. The grants may be used to—
(A) implement the ideas of the community ad-
justment committee findings for the community;
(B) hire an economic development consultant to
aid in the management and facilitation efforts of
conversion;
(C) develop specific action plans for conversion;
and
(D) apply to the Economic Development Ad-
ministration of the Department of Commerce for
conversion assistance.
SEC. 104. COMMUNITY ECONOMIC ADJUSTMENT ASSIST-
ANCE THROUGH THE ECONOMIC DEVELOP-
MENT ADMINISTRATION OF THE DEPART-
MENT OF COMMERCE.
(a) ASSISTANCE AUTHORIZED.—A community that
has been determined by the Economic Development Ad-
ministration of the Department of Commerce, in consulta-
tion with the Office of Economic Adjustment of the De-
partment of Defense, to be a substantially and seriously
affected community shall be eligible for economic adjust-
ment assistance authorized under title IX of the Public
Works and Economic Development Act of 1965, subject
to the availability of appropriations for such purpose and
subject to meeting the eligibility requirements of such
title.
(b) PROCESS.—Any determination made under sub-
section (a) shall be made in accordance with the standards
and procedures established by the Economic Adjustment
Committee established in Executive Order 12049 (10
U.S.C. 111 note).
SEC. 105. IMPROVED NOTIFICATION FOR DISLOCATED
WORKERS OF AVAILABLE ASSISTANCE.
Section 4201 of the Defense Economic Adjustment,
Diversification, Conversion, and Stabilization Act of 1990
(Public Law 101–510; 104 Stat. 1851) is amended by
adding at the end the following new subsection:
‘‘(c) ROLE OF DIRECTOR OF DISLOCATED WORK-
ERS.—The Assistant Secretary of Defense for Economic
Adjustment shall be responsible for the notification re-
quirements imposed by this section. The Assistant Sec-
retary shall carry out this subsection through the Director
for Dislocated Workers appointed under section 136(b)(5)
of title 10, United States Code. The Director shall develop
a method of rapidly identifying substantially and seriously
affected businesses and qualified small businesses in order
to provide for sufficient time to allow workers with such
businesses to enroll in adjustment programs, such as the
defense conversion adjustment program under sections
325 and 325A of the Job Training Partnership Act (29
U.S.C. 1662d, 1662d-1).’’.
SEC. 106. ECONOMIC DIVERSIFICATION AND ADJUSTMENT
ASSISTANCE THROUGH THE DEPARTMENT OF
DEFENSE.
(a) IN GENERAL.—The Assistant Secretary of De-
fense for Economic Adjustment shall be responsible for as-
sessment and conversion possibilities for defense contrac-
tors, subcontractors, and qualified small businesses in a
substantially and seriously affected community. The As-
sistant Secretary shall carry out this section through the
Director of Diversification and Adjustment appointed
under section 136(b)(5) of title 10, United States Code.
The Director shall use technical assistance of the Depart-
ment of Defense to assist in the conversion and retention
of defense capabilities, the retooling of defense-related in-
frastructure to commercial use, and research and develop-
ment related to conversion.
(b) RETENTION OF CRITICAL TECHNOLOGIES.—The
Director, in conjunction with the Director of the Defense
Logistics Agency, will develop a listing of Department of
Defense classified and nonclassified critical technologies to
target those businesses involved in the production of criti-
cal technologies that could be lost due to a defense
downsizing or reduction. The Director will work with the
Secretary of Defense to provide grants and technical as-
sistance to aid in the retention of critical technologies that
have a chance to be lost due to downsizing.
SEC. 107. SMALL BUSINESS ASSISTANCE THROUGH THE DE-
PARTMENT OF DEFENSE.
(a) BUSINESS GRANTS AND LOANS.—
(1) ASSISTANCE FOR QUALIFIED SMALL BUSI-
NESSES.—A qualified small business may apply to
the Assistant Secretary of Defense for Economic Ad-
justment for grants and other assistance to aid in
conversion to nondefense activities. The Assistant
Secretary shall carry out this section through the
Director of Community Assistance Grants appointed
under section 136(b)(5) of title 10, United States
Code.
(2) ASSISTANCE FOR EMPLOYEES.—The Direc-
tor may also assist employees or former employees
of a defense contractor or defense subcontractor to
establish a small business concern.
(3) USE OF GRANTS.—A grant made under this
subsection may be used—
(A) to facilitate the conversion of a de-
fense-related business to a nondefense-related
business;
(B) to develop new business opportunities
and markets for a qualified small business; and
(C) for the purpose of retooling or machin-
ery purchases for the purpose of commercial
manufacturing.
(b) IMPROVED COOPERATION BETWEEN DOD AND
SBA.—The Assistant Secretary of Defense for Economic
Adjustment shall work with the Administrator of the
Small Business Administration—
(1) to coordinate their activities on behalf of
qualified small businesses;
(2) to target substantially and seriously affected
communities to provide assistance from the Small
Business Administration to aid in the conversion of
qualified small businesses to nondefense activities;
(3) to provide a listing of lenders, that are ap-
proved by the Administrator, to qualified small busi-
nesses to assist such businesses to receive financing
for defense conversion activities; and
(4) to provide information to former employees
of defense facilities, defense contractors, and defense
subcontractors, and qualified small businesses to as-
sist in the possible formation of new small busi-
nesses.
SEC. 108. INFORMATION AND COORDINATION SERVICES.
(a) LISTING OF CONVERSION, REINVESTMENT, AND
TRANSITION PROGRAMS.—The Assistant Secretary of De-
fense for Economic Adjustment shall develop and maintain
a list of all Federal programs concerned with the assess-
ment and relief of defense economic adjustment problems
resulting from reductions in defense spending, the comple-
tion or termination of defense contracts and subcontracts,
the displacement of defense workers and members of the
Armed Forces, and the closure or realignment of military
installations.
(b) INFORMATIONAL RESPONSIBILITIES.—The As-
sistant Secretary of Defense for Economic Adjustment
shall provide informational services to defense contractors
and defense subcontractors that desire to enter into part-
nerships under subchapter III of chapter 148 of title 10,
United States Code, for the purpose of developing, apply-
ing, or marketing dual-use technologies or for other busi-
ness purposes. In carrying out this subsection, the Assist-
ant Secretary shall consult with the Federal Trade Com-
mission to ensure that any such partnership formed is con-
sistent with the provisions of all applicable Antitrust Acts,
as defined in section 4 of the Federal Trade Commission
Act (15 U.S.C. 44).
(c) USE OF DIRECTOR OF COORDINATION AND IN-
FORMATIONAL
ACTIVITIES.—The Assistant Secretary
shall carry out this section through the Director of Coordi-
nation and Informational Activities appointed under sec-
tion 136(b)(5) of title 10, United States Code. The Direc-
tor shall develop the list required by subsection (a) in con-
sultation with appropriate officers of the Department of
Commerce, the Department of Labor, and the Small Busi-
ness Administration.
SEC. 109. AUTHORITY TO ALLOW ONE-YEAR MORATORIUM
ON PAYMENT OF RENT FOR USE OF CERTAIN
PROPERTY BY CERTAIN DEFENSE CONTRAC-
TORS FOR NON-GOVERNMENT PURPOSES.
(a) AUTHORITY.—(1) With respect to production and
research property owned by the Government, the Sec-
retary of Defense is authorized to provide a one-year mor-
atorium on the payment of rent for non-Government use
of that property by any defense contractor described in
subsection (b). After the expiration of the moratorium, the
Secretary shall collect the rent from the defense contractor
for the use of the property during that year over such pe-
riod of time as the Secretary considers appropriate.
(2) The authority provided in this subsection applies
whether or not the property is required by the Department
of Defense for performance of defense contracts or sub-
contracts.
(b) CONTRACTORS COVERED.—Subsection (a) applies
to any person under contract with the Department of De-
fense which is affected by a termination or significant re-
duction of major research and development programs and
procurement programs of the Department of Defense.
(c) DEFINITIONS.—For purposes of this section:
(1) The term ‘‘non-Government use’’ means use
other than for purposes in support of a contract
with the Department of Defense, including direct
commercial sales to domestic and foreign customers.
(2) The term ‘‘production and research prop-
erty’’ has the meaning provided under the provisions
of the Federal Acquisition Regulation relating to
contractor use and rental of Government property.
(d) EFFECTIVE DATE.—The authority provided by
this subsection shall take effect on October 1, 1993.
SEC. 110. AUTHORIZATION OF APPROPRIATIONS.
(a) IN GENERAL.—There are authorized to be appro-
priated to the Secretary of Defense $300,000,000 for fis-
cal year 1994 to carry out activities under sections 103,
106, 107, and 108 of this Act and section 4201(c) of the
Defense Economic Adjustment, Diversification, Conver-
sion, and Stabilization Act of 1990 (as added by section
105 of this Act).
(b) PROCUREMENT TECHNICAL ASSISTANCE.—There
are authorized to be appropriated to the Secretary of De-
fense $25,000,000 for fiscal year 1994 for the purpose
of providing procurement technical assistance under sec-
tion 2418 of title 10, United States Code, through the pro-
curement technical assistance centers.
(c) DEFENSE DUAL-USE ASSISTANCE EXTENSION
PROGRAM.—There are authorized to be appropriated to
the Secretary of Defense $75,000,000 for fiscal year 1994
to carry out the defense dual-use assistance extension pro-
gram under section 2524 of title 10, United States Code,
of which—
(1) $50,000,000 shall be available to support
the conversion technology research programs of the
National Institute of Standards and Technology; and
(2) $25,000,000 shall be available to support
the manufacturing extension program.
(d) AVAILABILITY OF APPROPRIATIONS.—Amounts
appropriated pursuant to this section shall remain avail-
able until expended.
TITLE 
II—IMPROVEMENTS 
TO
THE DEFENSE DIVERSIFICA-
TION PROGRAM UNDER THE
JOB TRAINING PARTNERSHIP
ACT
SEC. 201. TRANSFER OF AUTHORITY TO CARRY OUT PRO-
GRAM FROM SECRETARY OF DEFENSE TO
SECRETARY OF LABOR.
Section 325A of the Job Training Partnership Act
(29 U.S.C. 1662d-1) is amended—
(1) in subsection (a), by striking ‘‘From the
amount made available’’ and all that follows through
‘‘Secretary of Labor,’’ and inserting ‘‘The Sec-
retary’’;
(2) in subsection (c), by striking ‘‘Secretary of
Defense’’ each place it appears and inserting ‘‘Sec-
retary’’;
(3) in subsection (d)—
(A) in the introductory sentence of para-
graph (1), by striking ‘‘of Defense’’;
(B) in paragraph (1)(A), by striking ‘‘in
consultation with the Secretary of Labor,’’; and
(C) in the introductory sentence of para-
graph (2), by striking ‘‘of Defense’’;
(4) in subsection (e)—
(A) in the heading of such subsection, by
striking ‘‘OF DEFENSE’’; and
(B) by striking ‘‘Secretary of Defense’’
each place it appears and inserting ‘‘Secretary’’;
(5) in subsection (i), by striking ‘‘of Defense’’;
and
(6) in subsection (k)—
(A) in the introductory sentence of para-
graph (1), by striking ‘‘the Secretary of De-
fense, in consultation with the Secretary of
Labor’’ and inserting ‘‘the Secretary, in con-
sultation with the Secretary of Defense’’; and
(B) in paragraph (2), by striking ‘‘of De-
fense’’.
SEC. 202. AUTHORIZATION OF APPROPRIATIONS.
Section 3 of the such Act is amended by adding at
the end the following new subsection:
‘‘(g)(1) There are authorized to be appropriated to
carry out section 325A $50,000,000 for fiscal year 1994.
‘‘(2) Amounts authorized to be appropriated under
paragraph (1) are in addition to amounts authorized to
be appropriated and made available to carry out such sec-
tion pursuant to—
‘‘(A) subsection (b); and
‘‘(B) section 4465(c) of the Defense Conver-
sion, Reinvestment, and Transition Assistance Act of
1992.
‘‘(3) Amounts appropriated pursuant to paragraph
(1) are authorized to remain available until expended.’’.
SEC. 203. EFFECTIVE DATE.
The amendments made by this title shall take effect
on the date of the enactment of this Act or October 1,
1993, whichever occurs later.
Æ
HR 2498 IH——2