H. R. 3616—173
(1) The post-Cold War era is marked by geopolitical
uncertainty and by accelerating technological change, particu-
larly with regard to information technologies.
(2) The combination of that geopolitical uncertainty and
accelerating technological change portends a transformation
in the conduct of war, particularly in ways that are likely
to increase the effectiveness of joint operations.
(3) The Department of Defense must be organized appro-
priately in order to fully exploit the opportunities offered by,
and to meet the challenges posed by, this anticipated trans-
formation in the conduct of war.
(4) The basic organization of the Department of Defense
was established by the National Security Act of 1947 and
the 1949 amendments to that Act.
(5) The Goldwater-Nichols Department of Defense Reorga-
nization Act of 1986 (Public Law 99–433) dramatically improved
the capability of the Department of Defense to carry out oper-
ations involving joint forces, but did not specifically address
issues pertaining to the development of joint operations.
(6) In the future, the ability to achieve improved operations
of joint forces, particularly under rapidly changing technological
conditions, will depend on improved force development for joint
operations.
(b) INDEPENDENT
TASK
FORCE
ON
TRANSFORMATION
AND
DEPARTMENT
OF
DEFENSE
ORGANIZATION.—The Secretary of
Defense shall establish a task force of the Defense Science Board
to examine the current organization of the Department of Defense
with regard to the appropriateness of that organization for prepar-
ing for a transformation in the conduct of war. The task force
shall be established not later than November 1, 1998.
(c) DUTIES OF THE TASK FORCE.—The task force shall assess,
and shall make recommendations for the appropriate organization
of, the Office of the Secretary of Defense, the Joint Chiefs of Staff,
the individual Armed Forces, and the executive parts of the military
departments for the purpose of preparing the Department of
Defense for a transformation in the conduct of war. In making
those assessments and developing those recommendations, the task
force shall review the following:
(1) The general organization of the Department of Defense,
including whether responsibility and authority for issues relat-
ing to a transformation in the conduct of war are appropriately
allocated, especially among the Office of the Secretary of
Defense, the Joint Chiefs of Staff, and the individual Armed
Forces.
(2) The joint requirements process and the requirements
processes for each of the Armed Forces, including the establish-
ment of measures of effectiveness and methods for resource
allocation.
(3) The process and organizations responsible for doctrinal
development, including the appropriate relationship between
joint force and service doctrine and doctrinal development
organizations.
(4) The current programs and organizations under the
Office of the Secretary of Defense, the Joint Chiefs of Staff,
and the Armed Forces devoted to innovation and experimen-
tation related to a transformation in the conduct of war, includ-
ing the appropriateness of—
H. R. 3616—174
(A) conducting joint field tests;
(B) establishing a separate unified command as a joint
forces command to serve, as its sole function, as the trainer,
provider, and developer of forces for joint operations and
for conducting joint warfighting experimentation;
(C) establishing a separate Joint Concept Development
Center to monitor exercises and develop measures of
effectiveness, analytical concepts, models, and simulations
appropriate for understanding the transformation in the
conduct of war;
(D) establishing a Joint Battle Laboratory to conduct
joint experimentation and to integrate the similar efforts
of the Armed Forces; and
(E) establishing an Assistant Secretary of Defense
responsible for transformation in the conduct of war.
(5) Joint training establishments and training establish-
ments of the Armed Forces, including those devoted to profes-
sional military education, and the appropriateness of establish-
ing national training centers.
(6) Other issues relating to a transformation in the conduct
of war that the Secretary considers appropriate.
(d) REPORT.—The task force shall submit to the Secretary of
Defense a report containing its assessments and recommendations
not later than February 1, 1999. The Secretary shall submit the
report to the Committee on National Security of the House of
Representatives and the Committee on Armed Services of the Sen-
ate not later than March 1, 1999, together with the recommenda-
tions and comments of the Secretary of Defense.
SEC. 904. AUTHORITY TO EXPAND THE NATIONAL DEFENSE UNIVER-
SITY.
Section 2165(b) of title 10, United States Code, is amended
by adding at the end the following:
‘‘(7) Any other educational institution of the Department
of Defense that the Secretary considers appropriate and des-
ignates as an institution of the university.’’.
SEC. 905. CENTER FOR HEMISPHERIC DEFENSE STUDIES.
(a) FUNDING FOR CENTER.—Section 2165 of title 10, United
States Code, is amended by adding at the end the following new
subsection:
‘‘(c) SOURCE OF FUNDS FOR CENTER FOR HEMISPHERIC DEFENSE
STUDIES.—Funds available for the payment of personnel expenses
under the Latin American cooperation authority set forth in section
1050 of this title are also available for the costs of the operation
of the Center for Hemispheric Defense Studies.’’.
(b) CONFORMING AMENDMENT.—Section 1050 of such title is
amended by inserting ‘‘Secretary of Defense or the’’ before ‘‘Sec-
retary of a military department’’.
SEC. 906. RESTRUCTURING OF ADMINISTRATION OF FISHER HOUSES.
(a) ADMINISTRATION AS NONAPPROPRIATED FUND INSTRUMEN-
TALITY.—(1) Chapter 147 of title 10, United States Code, is amended
by inserting after section 2492 (as added by section 365) the follow-
ing new section:
H. R. 3616—175
‘‘§ 2493. Fisher Houses: administration as nonappropriated
fund instrumentality
‘‘(a) FISHER HOUSES
AND SUITES DEFINED.—In this section:
‘‘(1) The term ‘Fisher House’ means a housing facility that—
‘‘(A) is located in proximity to a health care facility
of the Army, the Air Force, or the Navy;
‘‘(B) is available for residential use on a temporary
basis by patients of that health care facility, members
of the families of such patients, and others providing the
equivalent of familial support for such patients; and
‘‘(C) is constructed and donated by—
‘‘(i) the Zachary and Elizabeth M. Fisher Armed
Services Foundation; or
‘‘(ii) another source, if the Secretary of the military
department concerned designates the housing facility
as a Fisher House.
‘‘(2) The term ‘Fisher Suite’ means one or more rooms
that—
‘‘(A) meet the requirements of subparagraphs (A) and
(B) of paragraph (1);
‘‘(B) are constructed, altered, or repaired and donated
by a source described in subparagraph (C) of that para-
graph; and
‘‘(C) are designated by the Secretary of the military
department concerned as a Fisher Suite.
‘‘(b) NONAPPROPRIATED
FUND
INSTRUMENTALITY.—The Sec-
retary of each military department shall administer all Fisher
Houses and Fisher Suites associated with health care facilities
of that military department as a nonappropriated fund instrumen-
tality of the United States.
‘‘(c) GOVERNANCE.—The Secretary of each military department
shall establish a system for the governance of the nonappropriated
fund instrumentality required by subsection (b) for that military
department.
‘‘(d) CENTRAL FUND.—The Secretary of each military depart-
ment shall establish a single fund as the source of funding for
the operation, maintenance, and improvement of all Fisher Houses
and Fisher Suites of the nonappropriated fund instrumentality
required by subsection (b) for that military department.
‘‘(e) ACCEPTANCE OF CONTRIBUTIONS; IMPOSITION OF FEES.—
(1) The Secretary of a military department may—
‘‘(A) accept money, property, and services donated for the
support of a Fisher House or Fisher Suite associated with
health care facilities of that military department; and
‘‘(B) may impose fees relating to the use of such Fisher
Houses and Fisher Suites.
‘‘(2) All monetary donations, and the proceeds of the disposal
of any other donated property, accepted by the Secretary of a
military department under this subsection shall be credited to the
fund established under subsection (d) for the Fisher Houses and
Fisher Suites associated with health care facilities of that military
department and shall be available to that Secretary to support
all such Fisher Houses and Fisher Suites.
‘‘(f ) ANNUAL REPORT.—Not later than January 15 of each year,
the Secretary of each military department shall submit to Congress
a report describing the operation of Fisher Houses and Fisher
H. R. 3616—176
Suites associated with health care facilities of that military depart-
ment. The report shall include, at a minimum, the following:
‘‘(1) The amount in the fund established by that Secretary
under subsection (d) as of October 1 of the previous year.
‘‘(2) The operation of the fund during the preceding fiscal
year, including—
‘‘(A) all gifts, fees, and interest credited to the fund;
and
‘‘(B) all disbursements from the fund.
‘‘(3) The budget for the operation of the Fisher Houses
and Fisher Suites for the fiscal year in which the report is
submitted.’’.
(2) The table of sections at the beginning of such chapter
is amended by inserting after the item relating to section 2492
(as added by section 365) the following new item:
‘‘2493. Fisher Houses: administration as nonappropriated fund instrumentality.’’.
(b) ESTABLISHMENT OF FUNDS.—Not later than 90 days after
the date of the enactment of this Act, the Secretary of each military
department shall—
(1) establish the fund required under section 2493(d) of
title 10, United States Code (as added by subsection (a)); and
(2) close the Fisher House Trust Fund established for that
department under section 2221 of such title and transfer the
amounts in the closed fund to the newly established fund.
(c) FUNDING TRANSITION.—(1) Of the amount authorized to
be appropriated pursuant to section 301(2) for operation and mainte-
nance for the Navy, the Secretary of the Navy shall transfer to
the fund established by that Secretary under section 2493(d) of
title 10, United States Code (as added by subsection (a)), such
amount as that Secretary considers appropriate for establishing
in the fund a corpus sufficient for operating Fisher Houses and
Fisher Suites associated with health care facilities of the Depart-
ment of the Navy.
(2) Of the amount authorized to be appropriated pursuant
to section 301(4) for operation and maintenance for the Air Force,
the Secretary of the Air Force shall transfer to the fund established
by that Secretary under section 2493(d) of title 10, United States
Code (as added by subsection (a)), such amount as that Secretary
considers appropriate for establishing in the fund a corpus sufficient
for operating Fisher Houses and Fisher Suites associated with
health care facilities of the Department of the Air Force.
(d) REPORTING REQUIREMENTS.—The Secretary of each military
department, upon completing the actions required of the Secretary
under subsections (b) and (c), shall submit to Congress a report
containing—
(1) the certification of that Secretary that those actions
have been completed; and
(2) a statement of the amount deposited in the fund estab-
lished by that Secretary under section 2493(d) of title 10, United
States Code (as added by subsection (a)).
(e) AVAILABILITY OF TRANSFERRED AMOUNTS.—Amounts trans-
ferred under subsection (b) or (c) to a fund established under
section 2493(d) of title 10, United States Code (as added by sub-
section (a)), shall be available without fiscal year limitation for
the purposes for which the fund is established and shall be adminis-
tered as nonappropriated funds.
H. R. 3616—177
(f ) CONFORMING REPEALS.—(1) Section 2221 of title 10, United
States Code, and the item relating to that section in the table
of sections at the beginning of chapter 131 of such title, are repealed.
(2) Section 1321(a) of title 31, United States Code, is amended
by striking out paragraphs (92), (93), and (94).
(3) The amendments made by this subsection shall take effect
90 days after the date of the enactment of this Act.
SEC. 907. MANAGEMENT REFORM FOR RESEARCH, DEVELOPMENT,
TEST, AND EVALUATION ACTIVITIES.
(a) ANALYSIS AND PLAN FOR REFORM OF MANAGEMENT OF RDTE
ACTIVITIES.—(1) The Secretary of Defense, acting through the Under
Secretary of Defense for Acquisition and Technology, shall analyze
the structures and processes of the Department of Defense for
management of its laboratories and test and evaluation centers.
Taking into consideration the results of that analysis, the Secretary
shall develop a plan for improving the management of those labora-
tories and centers. The plan shall include such reorganizations
and reforms as the Secretary considers appropriate.
(2) The analysis under paragraph (1) shall include an analysis
of each of the following with respect to Department of Defense
laboratories and test and evaluation centers:
(A) Opportunities to improve efficiency and reduce duplica-
tion of efforts by those laboratories and centers by designating
a lead agency or executive agent by area or function or other
methods of streamlining management.
(B) Reform of the management processes of those labora-
tories and centers that would reduce costs and increase effi-
ciency in the conduct of research, development, test, and evalua-
tion activities.
(C) Opportunities for those laboratories and centers to enter
into partnership arrangements with laboratories in industry,
academia, and other Federal agencies that demonstrate leader-
ship, initiative, and innovation in research, development, test,
and evaluation activities.
(D) The extent to which there is disseminated within those
laboratories and centers information regarding initiatives that
have successfully improved efficiency through reform of
management processes and other means.
(E) Any cost savings that can be derived directly from
reorganization of management structures of those laboratories
and centers.
(F) Options for reinvesting any such cost savings in those
laboratories and centers.
(3) The Secretary shall submit the plan required under para-
graph (1) to the congressional defense committees not later than
180 days after the date of the enactment of this Act.
(b) COST-BASED MANAGEMENT INFORMATION SYSTEM.—(1) The
Secretary of Defense shall develop a plan, including a schedule,
for establishing a cost-based management information system for
Department of Defense laboratories and test and evaluation centers.
The system shall provide for accurately identifying and comparing
the costs of operating each laboratory and each center.
(2) In preparing the plan, the Secretary shall assess the feasibil-
ity and desirability of establishing a common methodology for
assessing costs. The Secretary shall consider the use of a revolving
fund as one potential methodology.
H. R. 3616—178
(3) The Secretary shall submit the plan required under para-
graph (1) to the congressional defense committees not later than
90 days after the date of the enactment of this Act.
Subtitle B—Department of Defense
Financial Management
SEC. 911. IMPROVED ACCOUNTING FOR DEFENSE CONTRACT SERV-
ICES.
(a) IN GENERAL.—(1) Chapter 131 of title 10, United States
Code, is amended by inserting after section 2211 the following
new section:
‘‘§ 2212. Obligations for contract services: reporting in budget
object classes
‘‘(a) LIMITATION ON REPORTING IN MISCELLANEOUS SERVICES
OBJECT CLASS.—The Secretary of Defense shall ensure that, in
reporting to the Office of Management and Budget (pursuant to
OMB Circular A–11 (relating to preparation and submission of
budget estimates)) obligations of the Department of Defense for
any period of time for contract services, no more than 15 percent
of the total amount of obligations so reported is reported in the
miscellaneous services object class.
‘‘(b) DEFINITION OF REPORTING CATEGORIES FOR ADVISORY AND
ASSISTANCE SERVICES.—In carrying out section 1105(g) of title 31
for the Department of Defense (and in determining what services
are to be reported to the Office of Management and Budget in
the advisory and assistance services object class), the Secretary
of Defense shall apply to the terms used for the definition of
‘advisory and assistance services’ in paragraph (2)(A) of that section
the following meanings (subject to the authorized exemptions):
‘‘(1) MANAGEMENT AND PROFESSIONAL SUPPORT SERVICES.—
The term ‘management and professional support services’ (used
in clause (i) of section 1105(g)(2)(A) of title 31) means services
that provide engineering or technical support, assistance,
advice, or training for the efficient and effective management
and operation of organizations, activities, or systems. Those
services—
‘‘(A) are closely related to the basic responsibilities
and mission of the using organization; and
‘‘(B) include efforts that support or contribute to
improved organization or program management, logistics
management, project monitoring and reporting, data collec-
tion, budgeting, accounting, auditing, and administrative
or technical support for conferences and training programs.
‘‘(2) STUDIES, ANALYSES, AND
EVALUATIONS.—The term
‘studies, analyses, and evaluations’ (used in clause (ii) of section
1105(g)(2)(A) of title 31) means services that provide organized,
analytic assessments to understand or evaluate complex issues
to improve policy development, decisionmaking, management,
or administration and that result in documents containing data
or leading to conclusions or recommendations. Those services
may include databases, models, methodologies, and related soft-
ware created in support of a study, analysis, or evaluation.
H. R. 3616—179
‘‘(3) ENGINEERING
AND
TECHNICAL
SERVICES.—The term
‘engineering and technical services’ (used in clause (iii) of sec-
tion 1105(g)(2)(A) of title 31) means services that take the
form of advice, assistance, training, or hands-on training nec-
essary to maintain and operate fielded weapon systems, equip-
ment, and components (including software when applicable)
at design or required levels of effectiveness.
‘‘(c) PROPER CLASSIFICATION
OF ADVISORY
AND ASSISTANCE
SERVICES.—Before the submission to the Office of Management
and Budget of the proposed Department of Defense budget for
inclusion in the President’s budget for a fiscal year pursuant to
section 1105 of title 31, the Secretary of Defense, acting through
the Under Secretary of Defense (Comptroller), shall conduct a
review of Department of Defense services expected to be performed
as contract services during the fiscal year for which that budget
is to be submitted in order to ensure that those services that
are advisory and assistance services (as defined in accordance with
subsection (b)) are in fact properly classified, in accordance with
that subsection, in the advisory and assistance services object class.
‘‘(d) REPORT TO CONGRESS.—The Secretary shall submit to Con-
gress each year, not later than 30 days after the date on which
the budget for the next fiscal year is submitted pursuant to section
1105 of title 31, a report containing the information derived from
the review under subsection (c).
‘‘(e) 
ASSESSMENT
BY
COMPTROLLER
GENERAL.—(1) 
The
Comptroller General shall conduct a review of the report of the
Secretary of Defense under subsection (d) each year and shall—
‘‘(A) assess the methodology used by the Secretary in
obtaining the information submitted to Congress in that report;
and
‘‘(B) assess the information submitted to Congress in that
report.
‘‘(2) Not later than 120 days after the date on which the
Secretary submits to Congress the report required under subsection
(d) for any year, the Comptroller General shall submit to Congress
the Comptroller General’s report containing the results of the review
for that year under paragraph (1).
‘‘(f ) DEFINITIONS.—In this section:
‘‘(1) The term ‘contract services’ means all services that
are reported to the Office of Management and Budget pursuant
to OMB Circular A–11 (relating to preparation and submission
of budget estimates) in budget object classes that are designated
in the Object Class 25 series.
‘‘(2) The term ‘advisory and assistance services object class’
means those contract services constituting the budget object
class that is denominated ‘Advisory and Assistance Service’
and designated (as of the date of the enactment of this section)
as Object Class 25.1 (or any similar object class established
after the date of the enactment of this section for the reporting
of obligations for advisory and assistance contract services).
‘‘(3) The term ‘miscellaneous services object class’ means
those contract services constituting the budget object class that
is denominated ‘Other Services (services not otherwise specified
in the 25 series)’ and designated (as of the date of the enactment
of this section) as Object Class 25.2 (or any similar object
class established after the date of the enactment of this section
H. R. 3616—180
for the reporting of obligations for miscellaneous or unspecified
contract services).
‘‘(4) The term ‘authorized exemptions’ means those exemp-
tions authorized (as of the date of the enactment of this section)
under Department of Defense Directive 4205.2, captioned
‘Acquiring and Managing Contracted Advisory and Assistance
Services (CAAS)’ and issued by the Under Secretary of Defense
for Acquisition and Technology on February 10, 1992, such
exemptions being set forth in Enclosure 3 to that directive
(captioned ‘CAAS Exemptions’).’’.
(2) The table of sections at the beginning of such chapter
is amended by inserting after the item relating to section 2211
the following new item:
‘‘2212. Obligations for contract services: reporting in budget object classes.’’.
(b) TRANSITION.—For the budget for fiscal year 2000, and the
reporting of information to the Office of Management and Budget
in connection with the preparation of that budget, section 2212
of title 10, United States Code, as added by subsection (a), shall
be applied by substituting ‘‘30 percent’’ in subsection (a) for ‘‘15
percent’’.
(c) INITIAL CLASSIFICATION OF ADVISORY AND ASSISTANCE SERV-
ICES.—Not later than February 1, 1999, the Secretary of Defense,
acting through the Under Secretary of Defense (Comptroller), shall
conduct a review of Department of Defense services performed
or expected to be performed as contract services during fiscal year
1999 in order to ensure that those services that are advisory and
assistance services (as defined in accordance with subsection (b)
of section 2212 of title 10, United States Code, as added by sub-
section (a)) are in fact properly classified, in accordance with that
subsection, in the advisory and assistance services object class
(as defined in subsection (f )(2) of that section).
(d) FISCAL YEAR 1999 REDUCTION.—The total amount that may
be obligated by the Secretary of Defense for contracted advisory
and assistance services from amounts appropriated for fiscal year
1999 is the amount programmed for those services resulting from
the review referred to in subsection (c) reduced by $240,000,000.
SEC. 912. REPORT ON DEPARTMENT OF DEFENSE FINANCIAL MANAGE-
MENT IMPROVEMENT PLAN.
Not later than 60 days after the date on which the Secretary
of Defense submits the first biennial financial management
improvement plan required by section 2222 of title 10, United
States Code, the Comptroller General shall submit to Congress
an analysis of the plan. The analysis shall include a discussion
of the content of the plan and the extent to which the plan—
(1) complies with the requirements of such section 2222;
and
(2) is a workable plan for addressing the financial manage-
ment problems of the Department of Defense.
SEC. 913. STUDY OF FEASIBILITY OF PERFORMANCE OF DEPARTMENT
OF DEFENSE FINANCE AND ACCOUNTING FUNCTIONS BY
PRIVATE 
SECTOR 
SOURCES 
OR 
OTHER 
FEDERAL
SOURCES.
(a) STUDY REQUIRED.—(1) The Secretary of Defense shall carry
out a study of the feasibility and advisability of selecting on a
competitive basis the source or sources for performing the finance
H. R. 3616—181
and accounting functions of the Department of Defense from among
the Defense Finance and Accounting Service of the Department
of Defense and non-DFAS sources.
(2) For the purposes of this section, the term ‘‘non-DFAS
sources’’ means—
(A) the military departments;
(B) Federal agencies outside the Department of Defense;
and
(C) private sector sources.
(b) REPORT.—Not later than October 1, 1999, the Secretary
shall submit to Congress a report in writing on the results of
the study. The report shall include the following:
(1) A discussion of how the finance and accounting functions
of the Department of Defense are performed, including the
necessary operations, the operations actually performed, the
personnel required for the operations, and the core com-
petencies that are necessary for the performance of those func-
tions.
(2) A comparison of the performance of the finance and
accounting functions by the Defense Finance and Accounting
Service with the performance of finance and accounting func-
tions by non-DFAS sources that exemplify the best finance
and accounting practices and results, together with a compari-
son of the costs of the performance of those functions by the
Defense Finance and Accounting Service and the estimated
costs of the performance of those functions by non-DFAS
sources.
(3) The finance and accounting functions, if any, that are
appropriate for performance by non-DFAS sources, together
with a concept of operations that—
(A) specifies the mission;
(B) identifies the finance and accounting operations
to be performed;
(C) describes the work force that is necessary to per-
form those operations;
(D) discusses where the operations are to be performed;
(E) describes how the operations are to be performed;
and
(F) discusses the relationship between how the oper-
ations are to be performed and the mission.
(4) An analysis of how Department of Defense programs
or processes would be affected by the performance of the finance
and accounting functions of the Department of Defense by
one or more non-DFAS source.
(5) The status of the efforts within the Department of
Defense to consolidate and eliminate redundant finance and
accounting systems and to better integrate the automated and
manual systems of the department that provide input to finan-
cial management or accounting systems of the department.
(6) A description of a feasible and effective process for
selecting, on a competitive basis, sources to perform the finance
and accounting functions of the Department of Defense from
among the Defense Finance and Accounting Service and non-
DFAS sources, including a discussion of the selection criteria
the Secretary considers appropriate.
(7) An analysis of the costs and benefits of the various
policies and actions recommended.
H. R. 3616—182
(8) A discussion of any findings, analyses, and recommenda-
tions on the performance of the finance and accounting func-
tions of the Department of Defense that have been made by
the Task Force on Defense Reform appointed by the Secretary
of Defense on May 14, 1997.
(9) Any additional information and recommendations the
Secretary considers appropriate.
(c) MARKET RESEARCH.—In carrying out the study, the Sec-
retary shall conduct market research to determine whether or not
an efficient and competitive domestic market for finance and
accounting services exists. In conducting that research, the Sec-
retary shall consider whether the domestic market for finance and
accounting services could be reasonably expected to generate respon-
sive private sector competitors for the provision of the finance
and accounting services, or a portion of such services, of the Depart-
ment of Defense and whether there are any substantial barriers
to entry or expansion in that market. In conducting such research,
the Secretary shall consider not only the current state of the domes-
tic market for finance and accounting services, but also the potential
effects that the entry of the Department of Defense as a large,
long-term consumer of such services might have on that market.
SEC. 914. LIMITATION ON REORGANIZATION AND CONSOLIDATION OF
OPERATING LOCATIONS OF THE DEFENSE FINANCE AND
ACCOUNTING SERVICE.
(a) LIMITATION.—The Secretary of Defense may not close any
operating location of the Defense Finance and Accounting Service
before the date that is 90 days after the date on which the Secretary
submits to the Committee on Armed Services of the Senate and
the Committee on National Security of the House of Representatives
the plan required by subsection (b).
(b) PLAN REQUIRED.—The Secretary of Defense shall submit
to the Committee on Armed Services of the Senate and the Commit-
tee on National Security of the House of Representatives a strategic
plan for improving the financial management operations at each
of the operating locations of the Defense Finance and Accounting
Service.
(c) CONTENT OF PLAN.—The plan shall include the following:
(1) The workloads that it is necessary to perform at those
operating locations each fiscal year.
(2) The capacity and number of operating locations that
are necessary for performing those workloads.
(3) A discussion of the costs and benefits that could result
from reorganizing the operating locations of the Defense
Finance and Accounting Service on the basis of function per-
formed, together with the Secretary’s assessment of the feasibil-
ity of carrying out such a reorganization.
(d) SUBMITTAL OF PLAN.—The plan shall be submitted to the
Committee on Armed Services of the Senate and the Committee
on National Security of the House of Representatives not later
than January 15, 1999.
SEC. 915. ANNUAL REPORT ON RESOURCES ALLOCATED TO SUPPORT
AND MISSION ACTIVITIES.
(a) REQUIREMENT.—Section 113 of title 10, United States Code,
is amended by adding at the end the following new subsection:
‘‘(l) The Secretary shall include in the annual report to Congress
under subsection (c) the following:
H. R. 3616—183
‘‘(1) A comparison of the amounts provided in the defense
budget for support and for mission activities for each of the
preceding five fiscal years.
‘‘(2) A comparison of the number of military and civilian
personnel, shown by major occupational category, assigned to
support positions and to mission positions for each of the
preceding five fiscal years.
‘‘(3) An accounting, shown by service and by major occupa-
tional category, of the number of military and civilian personnel
assigned to support positions during each of the preceding
five fiscal years.
‘‘(4) A listing of the number of military and civilian person-
nel assigned to management headquarters and headquarters
support activities as a percentage of military end-strength for
each of the preceding five fiscal years.’’.
(b) REPORT ON TERMINOLOGY.—Not later than 90 days after
the date of the enactment of this Act, the Secretary of Defense
shall submit to the Committee on Armed Services of the Senate
and the Committee on National Security of the House of Representa-
tives a report setting forth the definitions of the terms ‘‘support’’
and ‘‘mission’’ that the Secretary proposes to use for purposes
of the report requirement under section 113(l) of title 10, United
States Code, as added by subsection (a).
Subtitle C—Joint Warfighting
Experimentation
SEC. 921. FINDINGS CONCERNING JOINT WARFIGHTING EXPERIMEN-
TATION.
Congress makes the following findings:
(1) The assessments of the Quadrennial Defense Review
and the National Defense Panel provide a compelling argu-
ment—
(A) that the security environment in the early 21st
century will include fundamentally different military chal-
lenges than the security environment in the late 20th cen-
tury; and
(B) reinforce the premise of the Goldwater-Nichols
Department of Defense Reorganization Act of 1986 that
future warfare will require more effective joint operational
concepts.
(2) Joint experimentation is necessary for—
(A) integrating advances in technology with changes
in organizational structure and joint operational concepts;
and
(B) determining the interdependent aspects of joint
warfare that are key for transforming the conduct of mili-
tary operations to meet future challenges successfully.
(3) It is essential that an energetic and innovative organiza-
tion be established in the Department of Defense with the
authority (subject to the authority and guidance of the Sec-
retary of Defense and Chairman of the Joint Chiefs of Staff)
to design and implement a process of joint experimentation
to investigate and test technologies and alternative forces and
concepts in field environments under realistic conditions
H. R. 3616—184
against the full range of future challenges to assist in develop-
ing and validating new joint warfighting concepts and
transforming the Armed Forces to meet the threats to national
security anticipated for the early 21st century.
SEC. 922. SENSE OF CONGRESS CONCERNING JOINT WARFIGHTING
EXPERIMENTATION.
(a) DESIGNATION OF COMMANDER TO HAVE JOINT WARFIGHTING
EXPERIMENTATION MISSION.—It is the sense of Congress that the
initiative of the Secretary of Defense to designate the commander
of a combatant command to have the mission of joint warfighting
experimentation is a key step in exploiting the potential of advanced
technologies, new organizational structures, and new joint oper-
ational concepts to transform the conduct of military operations
by the Armed Forces.
(b) RESOURCES AND AUTHORITY OF COMMANDER.—It is, further,
the sense of Congress that the commander of the combatant com-
mand referred to in subsection (a) should be provided with appro-
priate and sufficient resources for joint warfighting experimentation
and with the appropriate authority to execute the commander’s
assigned responsibilities and that such authority should include
the following:
(1) Planning, preparing, and conducting the program of
joint warfighting experimentation, which program should
include 
analyses, 
simulations, 
wargames, 
experiments,
advanced concept technology demonstrations, joint exercises
conducted in virtual and field environments, and, as a particu-
larly critical aspect, assessments of ‘‘red team’’ vulnerability.
(2) Developing scenarios and measures of effectiveness to
meet the operational challenges expected to be encountered
in the early 21st century and assessing the effectiveness of
current and new organizational structures, operational con-
cepts, and technologies in addressing those challenges.
(3) Integrating and testing in joint experimentation the
systems and concepts that result from warfighting experimen-
tation conducted by the Armed Forces and the Defense Agen-
cies.
(4) Coordinating with each of the Armed Forces and
Defense Agencies regarding the development and acquisition
of equipment (including surrogate or real technologies, plat-
forms, and systems), supplies, and services necessary for joint
experimentation.
(5) Providing the Secretary of Defense and the Chairman
of the Joint Chiefs of Staff with recommendations, based on
the conduct of joint warfighting experimentation, for—
(A) improving interoperability;
(B) reducing unnecessary redundancy;
(C) synchronizing technology fielding;
(D) developing joint operational concepts;
(E) prioritizing the most promising joint capabilities
for future experimentation; and
(F) prioritizing joint requirements and acquisition pro-
grams.
(6) Making recommendations to the Chairman of the Joint
Chiefs of Staff on mission needs statements and operational
requirements documents.
H. R. 3616—185
(c) CONGRESSIONAL REVIEW.—It is, further, the sense of Con-
gress that Congress—
(1) should review the adequacy of the process of trans-
formation to meet future challenges to the national security;
and
(2) if progress is determined inadequate, should consider
legislation to—
(A) establish an appropriate organization to conduct
the mission described in subsection (a); and
(B) provide to the commander given the responsibility
for that mission appropriate and sufficient resources for
joint warfighting experimentation and the appropriate
authority to execute that commander’s assigned responsibil-
ities for that mission, including the authorities specified
in subsection (b).
SEC. 923. REPORTS ON JOINT WARFIGHTING EXPERIMENTATION.
(a) INITIAL REPORT.—(1) The commander of the combatant com-
mand assigned by the Secretary of Defense to have the mission
for joint warfighting experimentation shall submit to the Secretary
an initial report on the implementation of joint experimentation.
Not later than April 1, 1999, the Secretary shall submit that report,
together with any comments that the Secretary considers appro-
priate and any comments that the Chairman of the Joint Chiefs
of Staff considers appropriate, to the Committee on Armed Services
of the Senate and the Committee on National Security of the
House of Representatives.
(2) The report of the commander under paragraph (1) shall
include the commander’s assessment of the following:
(A) The authority and responsibilities of the commander
as described in section 922(b).
(B) The organization of the commander’s combatant com-
mand, and of its staff, for carrying out the joint warfighting
experimentation mission.
(C) The process established for tasking forces to participate
in experimentation and the commander’s specific authority over
those forces, including forces designated as joint experimen-
tation forces.
(D) The resources provided for initial implementation of
joint warfighting experimentation, the process for providing
those resources to the commander, the categories of the funding,
and the authority of the commander for budget execution.
(E) The process established for the development and
acquisition of the materiel, supplies, services, and equipment
necessary for the conduct of joint warfighting experimentation.
(F) The process established for designing, preparing, and
conducting joint experiments.
(G) The role assigned the commander for—
(i) integrating and testing in joint warfighting
experimentation the systems that emerge from warfighting
experimentation by the Armed Forces or the Defense Agen-
cies;
(ii) assessing the effectiveness of organizational struc-
tures, operational concepts, and technologies; and
(iii) assisting the Secretary of Defense and Chairman
of the Joint Chiefs of Staff to prioritize requirements or
acquisition programs.
H. R. 3616—186
(b) ANNUAL REPORT.—(1) Chapter 23 of title 10, United States
Code, is amended by adding at the end the following new section:
‘‘§ 485. Joint warfighting experimentation
‘‘(a) ANNUAL REPORT.—The commander of the combatant com-
mand assigned by the Secretary of Defense to have the mission
for joint warfighting experimentation shall submit to the Secretary
an annual report on the conduct of joint experimentation activities
for the fiscal year ending in the year of the report. Not later
than December 1 of each year, the Secretary shall submit that
report, together with any comments that the Secretary considers
appropriate and any comments that the Chairman of the Joint
Chiefs of Staff considers appropriate, to the Committee on Armed
Services of the Senate and the Committee on National Security
of the House of Representatives.
‘‘(b) MATTERS TO BE INCLUDED.—Each report under this section
shall include, for the fiscal year covered by the report, the following:
‘‘(1) Any changes in the assessments of the matters
described in section 923(a)(2) of the Strom Thurmond National
Defense Authorization Act for Fiscal Year 1999 since the
preparation of the assessments of those matters set forth in
the latest report submitted under this section.
‘‘(2) A description of the conduct of joint experimentation
activities, including the number of activities, the forces
involved, the national security challenges addressed, the oper-
ational concepts assessed, and the scenarios and measures of
effectiveness used.
‘‘(3) An assessment of the results of joint warfighting
experimentation within the Department of Defense.
‘‘(4) With respect to joint warfighting experimentation, any
recommendations that the commander considers appropriate
regarding—
‘‘(A) the development or acquisition of advanced tech-
nologies;
‘‘(B) changes in organizational structure, operational
concepts, or joint doctrine;
‘‘(C) the conduct of experiments;
‘‘(D) the adequacy of resources; or
‘‘(E) changes in authority of the commander to develop
or acquire materiel, supplies, services, or equipment
directly for the conduct of joint warfighting experimen-
tation.’’.
(2) The table of sections at the beginning of such chapter
is amended by adding at the end the following new item:
‘‘485. Joint warfighting experimentation.’’.
(c) FIRST ANNUAL REPORT.—The first report under section 485
of title 10, United States Code, as added by subsection (b), shall
be made with respect to fiscal year 1999. In the case of the report
under that section for fiscal year 1999, the reference in subsection
(b)(1) of that section to the most recent report under that section
shall be treated as referring to the report under subsection (a)
of this section.
H. R. 3616—187
Subtitle D—Other Matters
SEC. 931. FURTHER REDUCTIONS IN DEFENSE ACQUISITION AND SUP-
PORT WORKFORCE.
(a) REDUCTION
OF
DEFENSE
ACQUISITION
AND
SUPPORT
WORKFORCE.—The Secretary of Defense shall accomplish reductions
in defense acquisition and support personnel positions during fiscal
year 1999 so that the total number of such personnel as of October
1, 1999, is less than the total number of such personnel as of
October 1, 1998, by at least the applicable number determined
under subsection (b).
(b) REQUIRED REDUCTION.—(1) The applicable number for pur-
poses of subsection (a) is 25,000. However, the Secretary of Defense
may specify a lower number, which may not be less than 12,500,
as the applicable number for purposes of subsection (a) if the
Secretary determines, and certifies to Congress not later than May
1, 1999, that an applicable number greater than the number speci-
fied by the Secretary would be inconsistent with the cost-effective
management of the defense acquisition system to obtain best value
equipment and with ensuring military readiness.
(2) The Secretary shall include with such a certification a
report setting forth a detailed explanation of each of the matters
certified. The report shall include—
(A) a detailed explanation of all matters incorporated in
the Secretary’s determination;
(B) a definition of the components of the defense acquisition
and support positions; and
(C) the allocation of the reductions under this section
among the occupational elements of those positions.
(3) The authority of the Secretary under paragraph (1) may
only be delegated to the Deputy Secretary of Defense.
(c) 
LIMITATION
ON
REDUCTION
OF
CORE
ACQUISITION
WORKFORCE.—The Secretary shall implement this section so that
the core defense acquisition workforce identified by the Secretary
in the report submitted pursuant to section 912(b) of the National
Defense Authorization Act for Fiscal Year 1998 (Public Law 105–
85; 111 Stat. 1860) is reduced proportionally no more than the
other occupational elements included as defense acquisition and
support positions in that report.
(d) DEFENSE ACQUISITION AND SUPPORT PERSONNEL DEFINED.—
For purposes of this section, the term ‘‘defense acquisition and
support personnel’’ means military and civilian personnel (other
than civilian personnel who are employed at a maintenance depot)
who are assigned to, or employed in, acquisition organizations of
the Department of Defense (as specified in Department of Defense
Instruction numbered 5000.58 dated January 14, 1992), and any
other organizations which the Secretary may determine to have
a predominantly acquisition mission.
SEC. 932. LIMITATION ON OPERATION AND SUPPORT FUNDS FOR THE
OFFICE OF THE SECRETARY OF DEFENSE.
Of the amount available for fiscal year 1999 for operation
and support activities of the Office of the Secretary of Defense,
not more than 90 percent may be obligated until each of the follow-
ing reports has been submitted:
H. R. 3616—188
(1) The report required to be submitted to the congressional
defense committees by section 904(b) of the National Defense
Authorization Act for Fiscal Year 1997 (Public Law 104–201;
110 Stat. 2619).
(2) The reports required to be submitted to Congress by
sections 911(b) and 911(c) of the National Defense Authorization
Act for Fiscal Year 1998 (Public Law 105–85; 111 Stat. 1858,
1859).
SEC. 933. CLARIFICATION AND SIMPLIFICATION OF RESPONSIBILITIES
OF 
INSPECTORS 
GENERAL 
REGARDING 
WHISTLE-
BLOWER PROTECTIONS.
(a) ROLES OF INSPECTORS GENERAL OF THE ARMED FORCES.—
(1) Subsection (c) of section 1034 of title 10, United States Code,
is amended—
(A) by striking out paragraph (1) and inserting in lieu
thereof the following:
‘‘(1) If a member of the armed forces submits to an Inspector
General an allegation that a personnel action prohibited by sub-
section (b) has been taken (or threatened) against the member
with respect to a communication described in paragraph (2), the
Inspector General shall take the action required under paragraph
(3).’’; and
(B) by striking out paragraph (3) and inserting in lieu
thereof the following:
‘‘(3)(A) An Inspector General receiving an allegation as
described in paragraph (1) shall expeditiously determine whether
there is sufficient evidence to warrant an investigation of the allega-
tion.
‘‘(B) If the Inspector General receiving such an allegation is
an Inspector General within a military department, that Inspector
General shall promptly notify the Inspector General of the Depart-
ment of Defense of the allegation. Such notification shall be made
in accordance with regulations prescribed under subsection (h).
‘‘(C) If an allegation under paragraph (1) is submitted to an
Inspector General within a military department and if the deter-
mination of that Inspector General under subparagraph (A) is that
there is not sufficient evidence to warrant an investigation of the
allegation, that Inspector General shall forward the matter to the
Inspector General of the Department of Defense for review.
‘‘(D) Upon determining that an investigation of an allegation
under paragraph (1) is warranted, the Inspector General making
the determination shall expeditiously investigate the allegation.
In the case of a determination made by the Inspector General
of the Department of Defense, that Inspector General may delegate
responsibility for the investigation to an appropriate Inspector Gen-
eral within a military department.
‘‘(E) In the case of an investigation under subparagraph (D)
within the Department of Defense, the results of the investigation
shall be determined by, or approved by, the Inspector General
of the Department of Defense (regardless of whether the investiga-
tion itself is conducted by the Inspector General of the Department
of Defense or by an Inspector General within a military depart-
ment).
‘‘(4) Neither an initial determination under paragraph (3)(A)
nor an investigation under paragraph (3)(D) is required in the
case of an allegation made more than 60 days after the date
H. R. 3616—189
on which the member becomes aware of the personnel action that
is the subject of the allegation.
‘‘(5) The Inspector General of the Department of Defense, or
the Inspector General of the Department of Transportation (in
the case of a member of the Coast Guard when the Coast Guard
is not operating as a service in the Navy), shall ensure that the
Inspector General conducting the investigation of an allegation
under this subsection is outside the immediate chain of command
of both the member submitting the allegation and the individual
or individuals alleged to have taken the retaliatory action.’’.
(2) Subsection (d) of such section is amended—
(A) by inserting ‘‘receiving the allegation’’ after ‘‘the Inspec-
tor General’’ the first place it appears; and
(B) by adding at the end the following: ‘‘In the case of
an allegation received by the Inspector General of the Depart-
ment of Defense, the Inspector General may delegate that
responsibility to the Inspector General of the armed force con-
cerned.’’.
(b) MISMANAGEMENT COVERED
BY PROTECTED COMMUNICA-
TIONS.—Subsection (c)(2)(B) of such section is amended by striking
out ‘‘Mismanagement’’ and inserting in lieu thereof ‘‘Gross mis-
management’’.
(c) SIMPLIFIED REPORTING
AND NOTICE REQUIREMENTS.—(1)
Paragraph (1) of subsection (e) of such section is amended—
(A) by striking out ‘‘Not later than 30 days after completion
of an investigation under subsection (c) or (d),’’ and inserting
in lieu thereof ‘‘After completion of an investigation under
subsection (c) or (d) or, in the case of an investigation under
subsection (c) by an Inspector General within a military depart-
ment, after approval of the report of that investigation under
subsection (c)(3)(E),’’
(B) by striking out ‘‘the Inspector General shall submit
a report on’’ and inserting in lieu thereof ‘‘the Inspector General
conducting the investigation shall submit a report on’’;
(C) by inserting ‘‘shall transmit a copy of the report on
the results of the investigation to’’ before ‘‘the member of the
armed forces’’; and
(D) by adding at the end the following new sentence: ‘‘The
report shall be transmitted to the Secretary, and the copy
of the report shall be transmitted to the member, not later
than 30 days after the completion of the investigation or, in
the case of an investigation under subsection (c) by an Inspector
General within a military department, after approval of the
report of that investigation under subsection (c)(3)(E).’’.
(2) Paragraph (2) of such subsection is amended—
(A) by striking out ‘‘submitted’’ after ‘‘In the copy of the
report’’ and inserting in lieu thereof ‘‘transmitted’’; and
(B) by adding at the end the following new sentence: ‘‘How-
ever, the copy need not include summaries of interviews con-
ducted, nor any document acquired, during the course of the
investigation. Such items shall be transmitted to the member,
if the member requests the items, with the copy of the report
or after the transmittal to the member of the copy of the
report, regardless of whether the request for those items is
made before or after the copy of the report is transmitted
to the member.’’.
H. R. 3616—190
(3) Paragraph (3) of such subsection is amended by striking
out ‘‘90 days’’ and inserting in lieu thereof ‘‘180 days’’.
(d) REPEAL OF POST-INVESTIGATION INTERVIEW REQUIREMENT.—
Subsection (h) of such section is repealed.
(e) DEFINITION OF INSPECTOR GENERAL DEFINED.—Subsection
( j)(2) of such section is amended—
(1) by redesignating subparagraph (B) as subparagraph
(G) and, in that subparagraph, by striking out ‘‘an officer’’
and inserting in lieu thereof ‘‘An officer’’;
(2) by striking out subparagraph (A) and inserting in lieu
thereof the following:
‘‘(A) The Inspector General of the Department of
Defense.
‘‘(B) The Inspector General of the Department of
Transportation, in the case of a member of the Coast Guard
when the Coast Guard is not operating as a service in
the Navy.
‘‘(C) The Inspector General of the Army, in the case
of a member of the Army.
‘‘(D) The Naval Inspector General, in the case of a
member of the Navy.
‘‘(E) The Inspector General of the Air Force, in the
case of a member of the Air Force.
‘‘(F) The Deputy Naval Inspector General for Marine
Corps Matters, in the case of a member of the Marine
Corps.’’; and
(3) in the matter preceding subparagraph (A), by striking
out ‘‘means—’’ and inserting in lieu thereof ‘‘means the follow-
ing:’’.
(f ) TECHNICAL
AND
CONFORMING
AMENDMENTS.—(1) Sub-
sections (i) and ( j) of such section are redesignated as subsections
(h) and (i), respectively.
(2) Subsection (b)(1)(B)(ii) of such section is amended by striking
out ‘‘subsection ( j))’’ and inserting in lieu thereof ‘‘subsection (i))
or any other Inspector General appointed under the Inspector Gen-
eral Act of 1978’’.
SEC. 934. REPEAL OF REQUIREMENT RELATING TO ASSIGNMENT OF
TACTICAL AIRLIFT MISSION TO RESERVE COMPONENTS.
Section 1438 of the National Defense Authorization Act for
Fiscal Year 1991 (Public Law 101–510; 104 Stat. 1689), as amended
by section 1023 of the National Defense Authorization Act for
Fiscal Years 1992 and 1993 (Public Law 102–190; 105 Stat. 1460),
is repealed.
SEC. 935. CONSULTATION WITH MARINE CORPS ON MAJOR DECISIONS
DIRECTLY CONCERNING MARINE CORPS AVIATION.
(a) IN GENERAL.—Chapter 503 of title 10, United States Code,
is amended by adding at the end the following new section:
‘‘§ 5026. Consultation with Commandant of the Marine Corps
on major decisions directly concerning Marine
Corps aviation
‘‘The Secretary of the Navy shall ensure that the views of
the Commandant of the Marine Corps are given appropriate consid-
eration before a major decision is made by an element of the
Department of the Navy outside the Marine Corps on a matter
that directly concerns Marine Corps aviation.’’.
H. R. 3616—191
(b) CLERICAL AMENDMENT.—The table of sections at the begin-
ning of such chapter is amended by adding at the end the following
new item:
‘‘5026. 
Consultation 
with 
Commandant 
of 
the 
Marine 
Corps 
on 
major
decisions directly concerning Marine Corps aviation.’’.
TITLE X—GENERAL PROVISIONS
Subtitle A—Financial Matters
Sec. 1001. Transfer authority.
Sec. 1002. Incorporation of classified annex.
Sec. 1003. Authorization of prior emergency supplemental appropriations for fiscal
year 1998.
Sec. 1004. Authorization of appropriations for Bosnia peacekeeping operations for
fiscal year 1999.
Sec. 1005. Partnership for Peace Information Management System.
Sec. 1006. United States contribution to NATO common-funded budgets in fiscal
year 1999.
Sec. 1007. Liquidity of working-capital funds.
Sec. 1008. Termination of authority to manage working-capital funds and certain
activities through the Defense Business Operations Fund.
Sec. 1009. Clarification of authority to retain recovered costs of disposals in work-
ing-capital funds.
Sec. 1010. Crediting of amounts recovered from third parties for loss or damage to
personal property shipped or stored at Government expense.
Subtitle B—Naval Vessels and Shipyards
Sec. 1011. Revision to requirement for continued listing of two Iowa-class battle-
ships on the Naval Vessel Register.
Sec. 1012. Transfer of U.S.S. NEW JERSEY.
Sec. 1013. Homeporting of the U.S.S. IOWA in San Francisco, California.
Sec. 1014. Sense of Congress concerning the naming of an LPD–17 vessel.
Sec. 1015. Reports on naval surface fire-support capabilities.
Sec. 1016. Long-term charter of three vessels in support of submarine rescue, escort,
and towing.
Sec. 1017. Transfer of obsolete Army tugboat.
Subtitle C—Counter-Drug Activities and Other Assistance for Civilian Law
Enforcement
Sec. 1021. Department of Defense support to other agencies for counter-drug activi-
ties.
Sec. 1022. Department of Defense support of National Guard drug interdiction and
counter-drug activities.
Sec. 1023. Department of Defense counter-drug activities in transit zone.
Subtitle D—Miscellaneous Report Requirements and Repeals
Sec. 1031. Repeal of unnecessary and obsolete reporting provisions.
Sec. 1032. Report regarding use of tagging system to identify hydrocarbon fuels used
by Department of Defense.
Subtitle E—Armed Forces Retirement Home
Sec. 1041. Appointment of Director and Deputy Director of the Naval Home.
Sec. 1042. Revision of inspection requirements relating to Armed Forces Retirement
Home.
Sec. 1043. Clarification of land conveyance authority, Armed Forces Retirement
Home.
Subtitle F—Matters Relating to Defense Property
Sec. 1051. Plan for improved demilitarization of excess and surplus defense prop-
erty.
Sec. 1052. Transfer of F–4 Phantom II aircraft to foundation.
Subtitle G—Other Department of Defense Matters
Sec. 1061. Pilot program on alternative notice of receipt of legal process for garnish-
ment of Federal pay for child support and alimony.
Sec. 1062. Training of special operations forces with friendly foreign forces.
H. R. 3616—192
Sec. 1063. Research grants competitively awarded to service academies.
Sec. 1064. Department of Defense use of frequency spectrum.
Sec. 1065. Department of Defense aviation accident investigations.
Sec. 1066. Investigation of actions relating to 174th Fighter Wing of New York Air
National Guard.
Sec. 1067. Program to commemorate 50th anniversary of the Korean War.
Sec. 1068. Designation of America’s National Maritime Museum.
Sec. 1069. Technical and clerical amendments.
Subtitle H—Other Matters
Sec. 1071. Act constituting presidential approval of vessel war risk insurance
requested by the Secretary of Defense.
Sec. 1072. Extension and reauthorization of Defense Production Act of 1950.
Sec. 1073. Requirement that burial flags furnished by the Secretary of Veterans Af-
fairs be wholly produced in the United States.
Sec. 1074. Sense of Congress concerning tax treatment of principal residence of
members of Armed Forces while away from home on active duty.
Sec. 1075. Clarification of State authority to tax compensation paid to certain em-
ployees.
Subtitle A—Financial Matters
SEC. 1001. TRANSFER AUTHORITY.
(a) AUTHORITY TO TRANSFER AUTHORIZATIONS.—(1) Upon deter-
mination by the Secretary of Defense that such action is necessary
in the national interest, the Secretary may transfer amounts of
authorizations made available to the Department of Defense in
this division for fiscal year 1999 between any such authorizations
for that fiscal year (or any subdivisions thereof). Amounts of
authorizations so transferred shall be merged with and be available
for the same purposes as the authorization to which transferred.
(2) The total amount of authorizations that the Secretary may
transfer under the authority of this section may not exceed
$2,000,000,000.
(b) LIMITATIONS.—The authority provided by this section to
transfer authorizations—
(1) may only be used to provide authority for items that
have a higher priority than the items from which authority
is transferred; and
(2) may not be used to provide authority for an item that
has been denied authorization by Congress.
(c) EFFECT
ON AUTHORIZATION AMOUNTS.—A transfer made
from one account to another under the authority of this section
shall be deemed to increase the amount authorized for the account
to which the amount is transferred by an amount equal to the
amount transferred.
(d) NOTICE TO CONGRESS.—The Secretary shall promptly notify
Congress of each transfer made under subsection (a).
SEC. 1002. INCORPORATION OF CLASSIFIED ANNEX.
(a) STATUS OF CLASSIFIED ANNEX.—The Classified Annex pre-
pared by the committee of conference to accompany the conference
report on the bill H.R. 3616 of the One Hundred Fifth Congress
and transmitted to the President is hereby incorporated into this
Act.
(b) CONSTRUCTION WITH OTHER PROVISIONS
OF ACT.—The
amounts specified in the Classified Annex are not in addition to
amounts authorized to be appropriated by other provisions of this
Act.
H. R. 3616—193
(c) LIMITATION ON USE OF FUNDS.—Funds appropriated pursu-
ant to an authorization contained in this Act that are made avail-
able for a program, project, or activity referred to in the Classified
Annex may only be expended for such program, project, or activity
in accordance with such terms, conditions, limitations, restrictions,
and requirements as are set out for that program, project, or activity
in the Classified Annex.
(d) DISTRIBUTION OF CLASSIFIED ANNEX.—The President shall
provide for appropriate distribution of the Classified Annex, or
of appropriate portions of the annex, within the executive branch
of the Government.
SEC. 1003. AUTHORIZATION OF PRIOR EMERGENCY SUPPLEMENTAL
APPROPRIATIONS FOR FISCAL YEAR 1998.
Amounts authorized to be appropriated to the Department of
Defense for fiscal year 1998 in the National Defense Authorization
Act for Fiscal Year 1998 (Public Law 105–85) are hereby adjusted,
with respect to any such authorized amount, by the amount by
which appropriations pursuant to such authorization were increased
(by a supplemental appropriation) or decreased (by a rescission),
or both, in the 1998 Supplemental Appropriations and Rescissions
Act (Public Law 105–174).
SEC. 1004. AUTHORIZATION OF APPROPRIATIONS FOR BOSNIA PEACE-
KEEPING OPERATIONS FOR FISCAL YEAR 1999.
(a) AUTHORIZATION
OF APPROPRIATIONS.—Funds are hereby
authorized to be appropriated for the Department of Defense for
fiscal year 1999 for incremental costs of the Armed Forces for
Bosnia 
peacekeeping 
operations 
in 
the 
total 
amount 
of
$1,858,600,000, as follows:
(1) For military personnel, in addition to the amounts
authorized to be appropriated in title IV of this Act:
(A) For the Army, $297,700,000.
(B) For the Navy, $9,700,000.
(C) For the Marine Corps, $2,700,000.
(D) For the Air Force, $33,900,000.
(E) For the Naval Reserve, $2,200,000.
(2) For operation and maintenance for the Overseas Contin-
gency Operations Transfer Fund, in addition to the total
amount authorized to be appropriated for that fund in section
301(24) of this Act, $1,512,400,000.
(b) DESIGNATION
AS EMERGENCY.—Funds authorized to be
appropriated in accordance with subsection (a) are designated as
emergency requirements pursuant to section 251(b)(2)(A) of the
Balanced Budget and Emergency Deficit Control Act of 1985 (2
U.S.C. 901(b)(2)(A)).
(c) LIMITATION.—(1) Funds available for the Department of
Defense for fiscal year 1999 for military personnel for the Army,
Navy, Marine Corps, Air Force, or Naval Reserve or for operation
and maintenance for the Overseas Contingency Operations Transfer
Fund may not be obligated or expended for Bosnia peacekeeping
operations in excess of the amount authorized to be appropriated
for that purpose under subsection (a).
(2) The President may waive the limitation in paragraph (1)
after submitting to Congress the following:
(A) The President’s written certification that the waiver
is necessary in the national security interests of the United
States.
H. R. 3616—194
(B) The President’s written certification that exercising
the waiver will not adversely affect the readiness of United
States military forces.
(C) A report setting forth the following:
(i) The reasons that the waiver is necessary in the
national security interests of the United States.
(ii) The specific reasons that additional funding is
required for the continued presence of United States mili-
tary forces participating in, or supporting, Bosnia peace-
keeping operations for fiscal year 1999.
(iii) A discussion of the impact on the military readi-
ness of United States Armed Forces of the continuing
deployment of United States military forces participating
in, or supporting, Bosnia peacekeeping operations.
(D) A supplemental appropriations request for the Depart-
ment of Defense for such amounts as are necessary for the
additional fiscal year 1999 costs associated with United States
military forces participating in, or supporting, Bosnia peace-
keeping operations.
(d) TRANSFER AUTHORITY.—The Secretary of Defense may
transfer amounts of authorizations made available to the Depart-
ment of Defense in subsection (a)(2) for fiscal year 1999 to any
of the authorizations for that fiscal year in section 301. Amounts
of authorizations so transferred shall be merged with and be avail-
able for the same purposes as the authorization to which trans-
ferred. The transfer authority under this subsection is in addition
to any other transfer authority provided in this Act.
(e) BOSNIA PEACEKEEPING OPERATIONS DEFINED.—For the pur-
poses of this section, the term ‘‘Bosnia peacekeeping operations’’—
(1) means the operation designated as Operation Joint
Forge and any other operation involving the participation of
any of the Armed Forces in peacekeeping or peace enforcement
activities in and around the Republic of Bosnia and
Herzegovina; and
(2) includes, with respect to Operation Joint Forge or any
such other operation, each activity that is directly related to
the support of the operation.
SEC. 1005. PARTNERSHIP FOR PEACE INFORMATION SYSTEM MANAGE-
MENT.
Funds authorized to be appropriated under titles II and III
of this Act shall be available for the Partnership for Peace Informa-
tion Management System as follows:
(1) Of the amount authorized to be appropriated under
section 201(4) for Defense-wide activities, $2,000,000.
(2) Of the amount authorized to be appropriated under
section 301(5) for Defense-wide activities, $3,000,000.
SEC. 1006. UNITED STATES CONTRIBUTION TO NATO COMMON-FUNDED
BUDGETS IN FISCAL YEAR 1999.
(a) FISCAL YEAR 1999 LIMITATION.—The total amount contrib-
uted by the Secretary of Defense in fiscal year 1999 for the common-
funded budgets of NATO may be any amount up to, but not in
excess of, the amount specified in subsection (b) (rather than the
maximum amount that would otherwise be applicable to those
contributions under the fiscal year 1998 baseline limitation).
(b) TOTAL AMOUNT.—The amount of the limitation applicable
under subsection (a) is the sum of the following:
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(1) The amounts of unexpended balances, as of the end
of fiscal year 1998, of funds appropriated for fiscal years before
fiscal year 1999 for payments for those budgets.
(2) The amount authorized to be appropriated under section
301(1) that is available for contributions for the NATO common-
funded military budget under section 314.
(3) The amount authorized to be appropriated under section
201 that is available for contribution for the NATO common-
funded civil budget under section 243.
(4) The total amount of the contributions authorized to
be made under section 2501.
(c) DEFINITIONS.—For purposes of this section:
(1) COMMON-FUNDED BUDGETS OF NATO.—The term ‘‘com-
mon-funded budgets of NATO’’ means the Military Budget,
the Security Investment Program, and the Civil Budget of
the North Atlantic Treaty Organization (and any successor
or additional account or program of NATO).
(2) FISCAL YEAR 1998 BASELINE LIMITATION.—The term ‘‘fis-
cal year 1998 baseline limitation’’ means the maximum annual
amount of Department of Defense contributions for common-
funded budgets of NATO that is set forth as the annual limita-
tion in section 3(2)(C)(ii) of the resolution of the Senate giving
the advice and consent of the Senate to the ratification of
the Protocols to the North Atlantic Treaty of 1949 on the
Accession of Poland, Hungary, and the Czech Republic (as
defined in section 4(7) of that resolution), approved by the
Senate on April 30, 1998.
SEC. 1007. LIQUIDITY OF WORKING-CAPITAL FUNDS.
(a) INCREASED CASH BALANCES.—The Secretary of Defense shall
administer the working-capital funds of the Department of Defense
during fiscal year 1999 so as to ensure that the total amount
of the cash balances in such funds on September 30, 1999, exceeds
the total amount of the cash balances in such funds on September
30, 1998, by $1,300,000,000.
(b) ACTIONS REGARDING UNBUDGETED LOSSES.—The Under Sec-
retary of Defense (Comptroller) shall take such actions regarding
unbudgeted losses for the working-capital funds as may be nec-
essary in order to ensure that such unbudgeted losses do not pre-
clude the Secretary of Defense from achieving the increase in cash
balances in working-capital funds required under subsection (a).
(c) WAIVER.—(1) The Secretary of Defense may waive the
requirements of this section upon certifying to Congress, in writing,
that the waiver is necessary to meet requirements associated with—
(A) a contingency operation (as defined in section 101(a)(13)
of title 10, United States Code); or
(B) an operation of the Armed Forces that commenced
before October 1, 1998, and continues during fiscal year 1999.
(2) The waiver authority under paragraph (1) may not be dele-
gated to any official other than the Deputy Secretary of Defense.
(3) The waiver authority under paragraph (1) does not apply
to the limitation in subsection (d) or the limitation in section
2208(l)(3) of title 10, United States Code (as added by subsection
(e)).
(d) FISCAL YEAR 1999 LIMITATION ON ADVANCE BILLINGS.—
(1) The total amount of the advance billings rendered or imposed
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for the working-capital funds of the Department of Defense and
the Defense Business Operations Fund in fiscal year 1999—
(A) for the Department of the Navy, may not exceed
$400,000,000; and
(B) for the Department of the Air Force, may not exceed
$400,000,000.
(2) In paragraph (1), the term ‘‘advance billing’’ has the meaning
given such term in section 2208(l) of title 10, United States Code.
(e) PERMANENT LIMITATION ON ADVANCE BILLINGS.—(1) Section
2208(l) 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) The total amount of the advance billings rendered or
imposed for all working-capital funds of the Department of Defense
in a fiscal year may not exceed $1,000,000,000.’’.
(2) Section 2208(l)(3) of such title, as added by paragraph
(1), applies to fiscal years after fiscal year 1999.
(f ) SEMIANNUAL REPORT.—(1) The Under Secretary shall submit
to the Committee on Armed Services of the Senate and the Commit-
tee on National Security of the House of Representatives—
(A) not later than May 1, 1999, a report on the administra-
tion of this section for the six-month period ending on March
31, 1999; and
(B) not later than November 1, 1999, a report on the
administration of this section for the six-month period ending
on September 30, 1999.
(2) Each report shall include, for the period covered by the
report, the following:
(A) The profit and loss status of each working-capital fund
activity.
(B) The actions taken by the Secretary of each military
department to use assessments of surcharges to correct for
unbudgeted losses.
SEC. 1008. TERMINATION OF AUTHORITY TO MANAGE WORKING-CAP-
ITAL FUNDS AND CERTAIN ACTIVITIES THROUGH THE
DEFENSE BUSINESS OPERATIONS FUND.
(a) REVISION OF CERTAIN DBOF PROVISIONS AND REENACTMENT
TO APPLY TO WORKING-CAPITAL FUNDS GENERALLY.—Section 2208
of title 10, United States Code, is amended by adding at the end
the following:
‘‘(m) CAPITAL
ASSET
SUBACCOUNTS.—Amounts charged for
depreciation of capital assets shall be credited to a separate capital
asset subaccount established within a working-capital fund.
‘‘(n) SEPARATE ACCOUNTING, REPORTING, AND AUDITING
OF
FUNDS AND ACTIVITIES.—The Secretary of Defense, with respect
to the working-capital funds of each Defense Agency, and the Sec-
retary of each military department, with respect to the working-
capital funds of the military department, shall provide for separate
accounting, reporting, and auditing of funds and activities managed
through the working-capital funds.
‘‘(o) CHARGES FOR GOODS AND SERVICES PROVIDED THROUGH
THE FUND.—(1) Charges for goods and services provided for an
activity through a working-capital fund shall include the following:
‘‘(A) Amounts necessary to recover the full costs of the
goods and services provided for that activity.