H. R. 3619—34 
‘‘(3) the temporary assignment or exchange of personnel 
between the Coast Guard and the Office of the Assistant Sec-
retary of the Navy for Research, Development, and Acquisition, 
including Naval Systems Command, to facilitate the develop-
ment of organic capabilities in the Coast Guard. 
‘‘(c) TECHNICAL REQUIREMENT APPROVAL PROCEDURES.—The 
Chief Acquisition Officer shall adopt, to the extent practicable, 
procedures modeled after those used by the Navy Senior Acquisition 
Official to approve all technical requirements. 
‘‘(d) ASSESSMENT.—Within 180 days after the date of enactment 
of the Coast Guard Authorization Act for fiscal years 2010 and 
2011, the Comptroller General of the United States shall transmit 
a report to the appropriate congressional committees that— 
‘‘(1) contains an assessment of current Coast Guard acquisi-
tion and management capabilities to manage Level 1 and Level 
2 acquisitions; 
‘‘(2) includes recommendations as to how the Coast Guard 
can improve its acquisition management, either through 
internal reforms or by seeking acquisition expertise from the 
Department of Defense; and 
‘‘(3) addresses specifically the question of whether the Coast 
Guard can better leverage Department of Defense or other 
agencies’ contracts that would meet the needs of Level 1 or 
Level 2 acquisitions in order to obtain the best possible price. 
‘‘§ 567. Undefinitized contractual actions 
‘‘(a) IN GENERAL.—The Coast Guard may not enter into an 
undefinitized contractual action unless such action is directly 
approved by the Head of Contracting Activity of the Coast Guard. 
‘‘(b) REQUESTS FOR UNDEFINITIZED CONTRACTUAL ACTIONS.— 
Any request to the Head of Contracting Activity for approval of 
an undefinitized contractual action shall include a description of 
the anticipated effect on requirements of the Coast Guard if a 
delay is incurred for the purposes of determining contractual terms, 
specifications, and price before performance is begun under the 
contractual action. 
‘‘(c) 
REQUIREMENTS
FOR
UNDEFINITIZED
CONTRACTUAL 
ACTIONS.— 
‘‘(1) DEADLINE FOR AGREEMENT ON TERMS, SPECIFICATIONS, 
AND PRICE.—A contracting officer of the Coast Guard may not 
enter into an undefinitized contractual action unless the 
contractual action provides for agreement upon contractual 
terms, specification, and price by the earlier of— 
‘‘(A) the end of the 180-day period beginning on the 
date on which the contractor submits a qualifying proposal 
to definitize the contractual terms, specifications, and price; 
or 
‘‘(B) the date on which the amount of funds obligated 
under the contractual action is equal to more than 50 
percent of the negotiated overall ceiling price for the 
contractual action. 
‘‘(2) LIMITATION ON OBLIGATIONS.— 
‘‘(A) IN GENERAL.—Except as provided in subparagraph 
(B), the contracting officer for an undefinitized contractual 
action may not obligate under such contractual action an 
amount that exceeds 50 percent of the negotiated overall
H. R. 3619—35 
ceiling price until the contractual terms, specifications, and 
price are definitized for such contractual action. 
‘‘(B) EXCEPTION.—Notwithstanding subparagraph (A), 
if a contractor submits a qualifying proposal to definitize 
an undefinitized contractual action before an amount that 
exceeds 50 percent of the negotiated overall ceiling price 
is obligated on such action, the contracting officer for such 
action may not obligate with respect to such contractual 
action an amount that exceeds 75 percent of the negotiated 
overall ceiling price until the contractual terms, specifica-
tions, and price are definitized for such contractual action. 
‘‘(3) WAIVER.—The Commandant may waive the application 
of this subsection with respect to a contract if the Commandant 
determines that the waiver is necessary to support— 
‘‘(A) a contingency operation (as that term is defined 
in section 101(a)(13) of title 10); 
‘‘(B) operations to prevent or respond to a transpor-
tation security incident (as defined in section 70101(6) of 
title 46); 
‘‘(C) an operation in response to an emergency that 
poses an unacceptable threat to human health or safety 
or to the marine environment; or 
‘‘(D) an operation in response to a natural disaster 
or major disaster or emergency designated by the President 
under the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (42 U.S.C. 5121 et seq.). 
‘‘(4) LIMITATION ON APPLICATION.—This subsection does not 
apply to an undefinitized contractual action for the purchase 
of initial spares. 
‘‘(d) INCLUSION OF NONURGENT REQUIREMENTS.—Requirements 
for spare parts and support equipment that are not needed on 
an urgent basis may not be included in an undefinitized contractual 
action by the Coast Guard for spare parts and support equipment 
that are needed on an urgent basis unless the Commandant 
approves such inclusion as being— 
‘‘(1) good business practice; and 
‘‘(2) in the best interests of the United States. 
‘‘(e) MODIFICATION OF SCOPE.—The scope of an undefinitized 
contractual action under which performance has begun may not 
be modified unless the Commandant approves such modification 
as being— 
‘‘(1) good business practice; and 
‘‘(2) in the best interests of the United States. 
‘‘(f) ALLOWABLE PROFIT.—The Commandant shall ensure that 
the profit allowed on an undefinitized contractual action for which 
the final price is negotiated after a substantial portion of the 
performance required is completed reflects— 
‘‘(1) the possible reduced cost risk of the contractor with 
respect to costs incurred during performance of the contract 
before the final price is negotiated; and 
‘‘(2) the reduced cost risk of the contractor with respect 
to costs incurred during performance of the remaining portion 
of the contract. 
‘‘(g) DEFINITIONS.—In this section: 
‘‘(1) UNDEFINITIZED CONTRACTUAL ACTION.— 
‘‘(A) IN GENERAL.—Except as provided in subparagraph 
(B), the term ‘undefinitized contractual action’ means a
H. R. 3619—36 
new procurement action entered into by the Coast Guard 
for which the contractual terms, specifications, or price 
are not agreed upon before performance is begun under 
the action. 
‘‘(B) EXCLUSION.—The term ‘undefinitized contractual 
action’ does not include contractual actions with respect 
to— 
‘‘(i) foreign military sales; 
‘‘(ii) purchases in an amount not in excess of the 
amount of the simplified acquisition threshold; or 
‘‘(iii) special access programs. 
‘‘(2) QUALIFYING PROPOSAL.—The term ‘‘qualifying proposal’ 
means a proposal that contains sufficient information to enable 
complete and meaningful audits of the information contained 
in the proposal as determined by the contracting officer. 
‘‘§ 568. Guidance on excessive pass-through charges 
‘‘(a) IN GENERAL.—Not later than 180 days after the date of 
enactment of the Coast Guard Authorization Act for Fiscal Years 
2010 and 2011, the Commandant shall issue guidance to ensure 
that pass-through charges on contracts, subcontracts, delivery 
orders, and task orders that are entered into with a private entity 
acting as a lead systems integrator by or on behalf of the Coast 
Guard are not excessive in relation to the cost of work performed 
by the relevant contractor or subcontractor. The guidance shall, 
at a minimum— 
‘‘(1) set forth clear standards for determining when no, 
or negligible, value has been added to a contract by a contractor 
or subcontractor; 
‘‘(2) set forth procedures for preventing the payment by 
the Government of excessive pass-through charges; and 
‘‘(3) identify any exceptions determined by the Com-
mandant to be in the best interest of the Government. 
‘‘(b) EXCESSIVE PASS-THROUGH CHARGE DEFINED.—In this sec-
tion the term ‘excessive pass-through charge’, with respect to a 
contractor or subcontractor that adds no, or negligible, value to 
a contract or subcontract, means a charge to the Government by 
the contractor or subcontractor that is for overhead or profit on 
work performed by a lower tier contractor or subcontractor, other 
than reasonable charges for the direct costs of managing lower 
tier contractors and subcontracts and overhead and profit based 
on such direct costs. 
‘‘(c) APPLICATION OF GUIDANCE.—The guidance under this sub-
section shall apply to contracts awarded to a private entity acting 
as a lead systems integrator by or on behalf of the Coast Guard 
on or after the date that is 360 days after the date of enactment 
of the Coast Guard Authorization Act for Fiscal Years 2010 and 
2011. 
‘‘§ 569. Report on former Coast Guard officials employed by 
contractors to the agency 
‘‘(a) REPORT REQUIRED.—Not later than December 31, 2011, 
and annually thereafter, the Comptroller General of the United 
States shall submit a report to the appropriate congressional 
committees on the employment during the preceding year by Coast 
Guard contractors of individuals who were Coast Guard officials 
in the previous 5-year period. The report shall assess the extent
H. R. 3619—37 
to which former Coast Guard officials were provided compensation 
by Coast Guard contractors in the preceding calendar year. 
‘‘(b) OBJECTIVES
OF
REPORT.—At a minimum, the report 
required by this section shall assess the extent to which former 
Coast Guard officials who receive compensation from Coast Guard 
contractors have been assigned by those contractors to work on 
contracts or programs between the contractor and the Coast Guard, 
including contracts or programs for which the former official person-
ally had oversight responsibility or decisionmaking authority when 
they served in or worked for the Coast Guard. 
‘‘(c) CONFIDENTIALITY REQUIREMENT.—The report required by 
this subsection shall not include the names of the former Coast 
Guard officials who receive compensation from Coast Guard contrac-
tors. 
‘‘(d) ACCESS TO INFORMATION.—A Coast Guard contractor shall 
provide the Comptroller General access to information requested 
by the Comptroller General for the purpose of conducting the study 
required by this section. 
‘‘(e) DEFINITIONS.—In this section: 
‘‘(1) COAST GUARD CONTRACTOR.—The term ‘Coast Guard 
contractor’ includes any person that received at least 
$10,000,000 in contractor awards from the Coast Guard in 
the calendar year covered by the annual report. 
‘‘(2) COAST GUARD OFFICIAL.—The term ‘Coast Guard offi-
cial’ includes former officers of the Coast Guard who were 
compensated at a rate of pay for grade O–7 or above during 
the calendar year prior to the date on which they separated 
from the Coast Guard, and former civilian employees of the 
Coast Guard who served at any Level of the Senior Executive 
Service under subchapter VIII of chapter 53 of title 5, United 
States Code, during the calendar year prior to the date on 
which they separated from the Coast Guard. 
‘‘SUBCHAPTER II—IMPROVED ACQUISITION PROCESS AND 
PROCEDURES 
‘‘§ 571. Identification of major system acquisitions 
‘‘(a) IN GENERAL.— 
‘‘(1) 
SUPPORT
MECHANISMS.—The 
Commandant 
shall 
develop and implement mechanisms to support the establish-
ment of mature and stable operational requirements for all 
acquisitions. 
‘‘(2) MISSION ANALYSIS; AFFORDABILITY ASSESSMENT.—The 
Commandant may not initiate a Level 1 or Level 2 acquisition 
project or program until the Commandant— 
‘‘(A) completes a mission analysis that— 
‘‘(i) identifies the specific capability gaps to be 
addressed by the project or program; and 
‘‘(ii) develops a clear mission need to be addressed 
by the project or program; and 
‘‘(B) prepares a preliminary affordability assessment 
for the project or program. 
‘‘(b) ELEMENTS.— 
‘‘(1) REQUIREMENTS.—The mechanisms required by sub-
section (a) shall ensure the implementation of a formal process 
for the development of a mission-needs statement, concept- 
of-operations document, capability development plan, and