I
103D CONGRESS
1ST SESSION
H. R. 1880
To mitigate the adverse effects on defense contractors and defense workers
of reductions in defense spending.
IN THE HOUSE OF REPRESENTATIVES
APRIL 28, 1993
Mr. BACCHUS of Florida introduced the following bill; which was referred
jointly to the Committees on Armed Services, Small Business, Education
and Labor, Energy and Commerce, Science, Space, and Technology, and
Banking, Finance and Urban Affairs
A BILL
To mitigate the adverse effects on defense contractors and
defense workers of reductions in defense spending.
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 Workers Eco-
nomic Reinvestment Act of 1993’’.
SEC. 2. TABLE OF CONTENTS.
The table of contents for this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Definitions.
TITLE 
I—DEFENSE 
PROCURE-
MENT SPECIFICATIONS
SEC. 101. EXAMINATION OF DEPARTMENT OF DEFENSE
PROCUREMENT SPECIFICATIONS.
(a) EXAMINATION.—Not later than one year after the
date of the enactment of this Act, the Secretary of Defense
shall complete an examination of all existing procurement
contracts of the Department of Defense to determine
whether those contracts which apply to dual-use tech-
nologies contain overly restrictive specifications on sys-
tems, supplies, and services that are also available com-
mercially.
(b) REPORT.—Upon completing the examination re-
quired by subsection (a), the Secretary of Defense shall
submit a report to the Congress detailing the results of
the examination. In the case of each contract examined
under subsection (a) which exceeds $100,000 and contains
Department of Defense specifications precluding the pur-
chase of commercial sector products, the report shall in-
clude the justification for developing a different specifica-
tion and the reasons for the unsuitability of commercial
specifications.
(c) CONSULTATION.—The Secretary of Defense shall
consult with the Military-Civilian Integration and Tech-
nology Transfer Advisory Board in conducting the exam-
ination required by subsection (a) and the report required
by subsection (b).
SEC. 102. GREATER DEFENSE USE OF COMMERCIALLY
AVAILABLE SYSTEMS, SUPPLIES, AND SERV-
ICES.
Section 2305(a)(1)(B) of title 10, United States
Code, is amended—
(1) by striking out ‘‘and’’ at the end of clause
(i);
(2) by striking out the period at the end of
clause (ii); and
(3) by adding at the end the following new
clause:
‘‘(iii) encourage the use of commercially avail-
able systems, supplies, and services.’’.
TITLE II—RETRAINING DEFENSE
WORKERS FOR NEW EMPLOY-
MENT
SEC. 201. TRAINING OVERSIGHT AND ADMINISTRATION
OFFICE.
(a) ESTABLISHMENT OF OFFICE.—The Secretary of
Defense shall establish an Office of Training Oversight
and Administration to coordinate and oversee retraining,
placement, and other transition assistance activities for el-
igible defense workers. The Office shall be under the su-
pervision of the Assistant Secretary of Defense for Force
Management and Personnel and shall be consolidated with
existing transition assistance programs for eligible defense
workers that are currently the responsibility of the Assist-
ant Secretary.
(b) INFORMATION
ON
RETRAINING
OPPORTUNI-
TIES.—The Office shall disseminate information to quali-
fied defense contractors and to civilian employees of the
Department of Defense concerning the availability, scope,
and rules governing the retraining and other transition as-
sistance programs for eligible defense workers established
under—
(1) section 202;
(2) section 1598 or 2410c of title 10, United
States Code; or
(3) section 325 or 325A of the Job Training
Partnership Act (29 U.S.C. 1662d, 1662d–1).
(c) PLACEMENT ASSISTANCE.—The Office should en-
sure that each qualified defense contractor informs all em-
ployees of the contractor regarding the programs referred
to in subsection (b). The Office shall facilitate placement
of eligible defense workers by acting as a repository for
employment opportunity information and publicizing the
availability of qualified employees.
(d) INFORMATION COLLECTION.—The Office shall
maintain statistics to analyze the effectiveness of the re-
training and placement programs in order to assist the
Assistant Secretary and provide any other information
that the Assistant Secretary may request.
SEC. 202. RETRAINING AND OTHER TRANSITION ASSIST-
ANCE PROGRAMS.
(a) SKILLS DEVELOPMENT PROGRAMS.—The Office,
in cooperation with other Federal agencies, may enter into
agreements to carry out skills development programs for
the provision of retraining assistance to eligible defense
workers in skills identified by the Office as being, or pro-
jected to be, in short supply in the area in which the pro-
gram operates. A skills development program may be de-
veloped and taught pursuant to the agreement by any
Federal agency, State and local governments, institutions
of higher learning (especially associate-degree granting
colleges), educational consultants, or qualified defense
contractors. The Office shall have principal responsibility
for transition assistance to eligible defense workers se-
lected to participate in such a skills development program
and should consult with the Secretary of Labor to avoid
duplication with services provided by the Department of
Labor under section 325 or 325A of the Job Training
Partnership Act (29 U.S.C. 1662d, 1662d–1).
(b) SCHOLARSHIP
PROGRAMS.—The Office may
award one-year and two-year scholarships to eligible de-
fense workers to assist the recipients of the scholarships
to attend educational institutions. The scholarships shall
be awarded on the basis of a competitive selection process,
except that the Office may give a priority—
(1) for scholarships in certain critical occupa-
tions, as determined by the Office; and
(2) to eligible defense workers who seek voca-
tional training offered by associate-degree granting
colleges.
(c) FEDERAL SHARE.—The Federal contribution to
a skills development program conducted under subsection
(a) may not exceed 50 percent of the costs of the program.
(d) ALLOWED EXPENSES.—Funds provided under
this section for a skills development program may be used
to pay employee certification, apprenticeship, or profes-
sional registration costs incurred by an eligible defense
worker receiving retraining to enter a new profession. The
Secretary may also share any other subsistence costs asso-
ciated with employee transition so long as the Federal
funding share does not exceed 50 percent of such costs.
Extended income support requirements can be reduced by
the employer through early retraining prior to employee
termination.
(e) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated to the Secretary of De-
fense for each of the fiscal years 1994 through 1996—
(1) $50,000,000 for skills development pro-
grams under subsection (a); and
(2) $25,000,000 for scholarships under sub-
section (b).
SEC. 203. ELIGIBLE DEFENSE WORKERS.
(a) ELIGIBILITY REQUIREMENTS.—To be eligible for
selection to participate in a skills development program
under section 202(a) or receive a scholarship under section
202(b), an individual must be—
(1) a full-time employee of a qualified defense
contractor for at least three years who—
(A) is directly involved with a Department
of Defense funded project which is canceled or
experiences a reduction in Federal funds equal
to at least 25 percent of the Federal funds re-
ceived for the project the previous year; and
(B) as a result of the cancellation or re-
duction, is terminated or identified by the em-
ployer as likely to be terminated within one
year; or
(2) a civilian employee of the Department of
Defense who is eligible for transition assistance
under rules established by the Secretary of Defense.
(b) NOTIFICATION.—A qualified defense contractor
shall make a good faith effort to identify as early as pos-
sible employees who meet the eligibility requirements of
subsection (a)(1), advise such employees on retraining op-
tions, and allow such employees to participate in skills de-
velopment programs and other transition assistance pro-
grams.
(c) CERTAIN PREVIOUSLY TERMINATED EMPLOY-
EES.—An employee of a qualified defense contractor who
was terminated during the one-year period ending on the
date of the enactment of this Act shall be eligible for as-
sistance under section 202 if the Office determines that
the employee—
(1) was a full-time employee of a qualified de-
fense contractor for at least three years;
(2) was directly involved with a Department of
Defense funded project; and
(3) was terminated as a result of the cancella-
tion or a funding reduction of that project.
TITLE III—COMMERCIALIZATION
AND 
DUAL-USE 
RESEARCH
OPPORTUNITIES 
FOR 
DE-
FENSE 
CONTRACTORS 
AND
SMALL BUSINESS
SEC. 301. PROMOTION OF COMMERCIALIZATION OPPORTU-
NITIES FOR QUALIFIED DEFENSE CONTRAC-
TORS.
(a) PROMOTION PROGRAMS.—The Secretary of Com-
merce shall establish a program to assist qualified defense
contractors to participate in the Advanced Technology
Program of the National Institute of Standards and Tech-
nology established under section 28 of the National Insti-
tute of Standards and Technology Act (15 U.S.C. 278n)
and other appropriate programs of the Department of
Commerce to commercialize significant new scientific dis-
coveries and technologies. The Secretary shall include lan-
guage in the solicitations and announcements of such pro-
grams to encourage proposals concerning critical tech-
nology and technology transfers from military to civilian
applications.
(b) NOTIFICATION OF ADVISORY BOARD.—The Sec-
retary of Commerce shall inform the Military-Civilian In-
tegration and Technology Transfer Advisory Board of the
status of projects involving qualified defense contractors.
SEC. 302. DEFENSE AND ENERGY DUAL-USE RESEARCH
UNDER THE SMALL BUSINESS INNOVATION
RESEARCH PROGRAM.
(a) ENCOURAGEMENT OF PROPOSALS WITH DUAL-
USE APPLICATION.—The Secretary of Defense and the
Secretary of Energy, in consultation with the Adminis-
trator of the Small Business Administration, shall include
language in solicitations of the Small Business Innovation
Research Program conducted by the Department of De-
fense and the Department of Energy encouraging research
proposals involving dual-use applications and proposals in-
volving military to civilian conversion. This subsection
shall apply with respect to solicitations for projects to be
funded in fiscal year 1994 and subsequent fiscal years.
(b) SPECIAL SET ASIDE.—Of the amount of the re-
search and development budget of the Department of De-
fense and the Department of Energy required under sec-
tion 9(f)(1) of the Small Business Act (15 U.S.C.
638(f)(1)) to be expended with small business concerns in
connection with the Small Business Innovation Research
Program—
(1) 10 percent of the amount set aside for fiscal
year 1994;
(2) 15 percent of the amount set aside for each
of the fiscal years 1995 and 1996; and
(3) 20 percent of the amount set aside for fiscal
year 1997,
shall be reserved for projects involving dual-use applica-
tions and projects involving military to civilian conversion.
SEC. 303. COMMERCIALIZATION LOANS.
(a) LOANS AUTHORIZED.—The Secretary of Com-
merce may make loans to qualified defense contractors to
carry out commercialization projects. The potential for the
development of a product that has military applications
and nonmilitary commercial applications shall be a cri-
terion in the selection of projects for funding, although
not an absolute requirement. Other criteria should include
the risk of the project compared to the utility to consum-
ers and the United States.
(b) AMOUNT
AND NUMBER
OF LOANS.—A loan
under this section may not exceed $2,000,000 for any one
commercialization project. No more than three loans may
be made to any single company or joint venture.
(c) TERMS.—A loan under this section shall be made
under such terms and conditions as the Secretary of Com-
merce may require, including the payment of fair market
interest, except that repayment of the loan shall be com-
pleted within seven years after the loan is made.
(d) MATCHING REQUIREMENT.—The recipient of a
loan under this section shall be required to match the
amount of the loan with an equal amount of non-Federal
funds specifically guaranteed for use in the project.
(e) AUTHORIZATION OF APPROPRIATIONS.—There is
authorized to be appropriated to the Secretary of Com-
merce for fiscal year 1994 $150,000,000 to carry out this
section. Funds appropriated pursuant to this subsection
shall be available until expended.
SEC. 304. PROMOTION OF INDUSTRIAL PARKS.
(a) PROMOTION.—The Secretary of Defense shall en-
courage the creation of industrial parks or technology in-
cubator centers, including prototyping facilities, to trans-
fer and spinoff technology from qualified defense contrac-
tors, including those operating national laboratories, to
small businesses.
(b) USES OF PATENT ROYALTIES.—The Secretary of
Defense may use up to 50 percent of the royalties from
the licensing of relevant Department of Defense and De-
partment of Energy owned patents to assist local tech-
nology transfer activities conducted in close proximity to
qualified defense contractor facilities and up to 25 percent
of such royalties to assist technology transfer activities
that are unrelated to the proximity of a qualified defense
contractor facility.
SEC. 305. DEFENSE COMMERCIALIZATION AWARD.
(a) AWARD.—The Secretary of Defense, in consulta-
tion with the Secretary of Commerce, shall create and ad-
minister an awards program to foster and encourage inno-
vation and redirection efforts by qualified defense contrac-
tors in the area of commercialization. Criteria for selection
of award recipients shall include job creation, leverage of
Federal funding, and product quality.
(b) MODEL.—The Secretary shall model the awards
program after the Malcolm Baldrige Quality Awards pro-
vided under section 17 of the Stevenson-Wydler Tech-
nology Innovation Act of 1980 (15 U.S.C. 3711a).
TITLE 
IV—FAST 
RESPONSE
STATE TECHNOLOGICAL COM-
PETITIVENESS GRANTS
SEC. 401. PURPOSE.
The purpose of this title is to provide Federal assist-
ance directly to States for defense reinvestment programs
to improve existing programs and to create new initiatives.
SEC. 402. USES OF FUNDS.
(a) IN GENERAL.—Funds made available under this
title shall be used by States to assist industries, workers,
and communities that have been adversely affected by the
overall reduction of defense spending in the State. States
may use such funds in conjunction with other Federal or
State assistance for programs within the public and pri-
vate sectors, involving industry, communities, and edu-
cational institutions. Qualifying projects should stress eco-
nomic development, quality job growth, education and re-
training, technology transfer, technology infrastructure,
and enhanced competitiveness. Preference in the funding
of projects should be given to projects concerning the de-
velopment or improvement of transportation infrastruc-
ture or environmentally sustaining technologies.
SEC. 403. FUNDING FORMULA.
(a) ALLOCATION.—From the amount appropriated
under section 405 for a fiscal year, the Secretary of De-
fense shall allocate such amounts for distribution consist-
ent with the formula specified in subsection (b) for such
fiscal years. The Secretary shall make such allocation in
consultation with the Military-Civilian Integration and
Technology Transfer Advisory Board.
(b) FORMULA.—From the amount allocated for a fis-
cal year under subsection (a), the Secretary of Defense
shall distribute during such fiscal year fast response State
technological competitiveness grants to States whose rein-
vestment programs meet the requirements of section 404
as follows:
(1) 50 percent of the total allocation for that
year shall be distributed among the States pro rata
based on the ratio of the population of the State to
the total population of all States, as determined by
the latest available Federal census.
(2) 50 percent of the total allocation for that
year to be distributed among the States pro rata
based on the ratio of the cumulative dollar amount
of Department of Defense purchases in the State for
fiscal year 1992 (including research and develop-
ment, procurement, operations and maintenance,
and construction) to the total dollar amount of such
Department of Defense purchases in all the States
as determined by the Department of Defense using
its most recent official data collected after fiscal
year 1990.
SEC. 404. STATE ELIGIBILITY.
(a) APPLICATION GUIDELINES.—The Secretary of
Defense, in consultation with the Advisory Board shall de-
velop and disseminate guidelines on State eligibility for
fast response State technological competitiveness grants.
The guidelines shall require the following:
(1) The State shall agree to contribute to the
defense reinvestment program of the State an
amount equal to at least 10 percent of the amount
of the technological competitiveness grant made to
the State.
(2) Any program using funds provided under a
technological competitiveness grant that is assisting
a defense contractor shall require the contractor to
provide at least a $1 funding match for every $2 ex-
pended in grant funds to assist the contractor.
(3) In addition to the matching contribution re-
quired by paragraph (1), the State shall guarantee
to maintain its aggregate expenditures from all other
sources for programs which provide technical and fi-
nancial assistance to defense contractors at or above
the average level of such expenditures in the two fis-
cal years preceding the date of the enactment of this
Act.
(b) STATE RESPONSIBILITY.—Prior to receiving a
fast response State technological competitiveness grant,
the Governor of the State shall provide to the Secretary
of Defense information about the defense reinvestment
program conducted by the State. The State shall appoint
a single agency or entity within the State to be the recipi-
ent of the Federal funding and to administer and oversee
the State’s reinvestment program. Each State must annu-
ally report on the progress of its defense reinvestment pro-
grams back to the Secretary and supply any analysis data
that the Secretary may require for program evaluation.
(c) WITHHOLDING
OF GRANT FUNDS.—The Sec-
retary of Defense shall withhold a fast response State
technological competitiveness grant from any State if the
Secretary concludes that the State’s defense reinvestment
program or the progress of such program is unsatisfactory
relative to the published guidelines. In such a case, the
Secretary shall provide to the State the reasons for its dis-
qualification and provide a 90-day appeal period during
which the State shall be allowed to submit a revised pro-
posal for review by the Secretary.
SEC. 405. AUTHORIZATION OF APPROPRIATIONS.
(a) IN GENERAL.—There is authorized to be appro-
priated to the Secretary of Defense for the fiscal years
1994 through 1996 $1,000,000,000 for fast response
State technological competitiveness grants under this title.
(b) AVAILABILITY.—Amounts appropriated under
subsection (a) shall remain available until expended.
Æ
HR 1880 IH——2