H. R. 2401—174
SEC. 843. REPORTS BY DEFENSE CONTRACTORS OF DEALINGS WITH
TERRORIST COUNTRIES.
(a) REPORT REQUIREMENT.—(1) Whenever the Secretary of
Defense proposes to enter into a contract with any person for
an amount in excess of $5,000,000 for the provision of goods or
services to the Department of Defense, the Secretary shall require
that person—
(A) before entering into the contract, to report to the Sec-
retary each commercial transaction which that person has con-
ducted with the government of any terrorist country during
the preceding three years or the period since the effective
date of this section, whichever is shorter; and
(B) to report to the Secretary each such commercial trans-
action which that person conducts during the course of the
contract (but not after the date specified in subsection (h))
with the government of any terrorist country.
(2) The requirement contained in paragraph (1)(B) shall be
included in the contract with the Department of Defense.
(b) REGULATIONS.—The Secretary of Defense shall prescribe
such regulations as may be necessary to carry out this section.
(c) ANNUAL REPORT TO CONGRESS.—The Secretary of Defense
shall submit to the Congress each year by December 1 a report
setting forth those persons conducting commercial transactions with
terrorist countries that are included in the reports made pursuant
to subsection (a) during the preceding fiscal year, the terrorist
countries with which those transactions were conducted, and the
nature of those transactions. The version of the report made avail-
able for public release shall exclude information exempt from public
disclosure under section 552 of title 5, United States Code (com-
monly known as the Freedom of Information Act).
(d) LIABILITY.—This section shall not be interpreted as imposing
any liability on a person for failure to comply with the reporting
requirement of subsection (a) if the failure to comply is caused
solely by an act or omission of a third party.
(e) PERSON DEFINED.—For purposes of this section, the term
‘‘person’’ means a corporate or other business entity proposing to
enter or entering into a contract covered by this section. The term
does not include an affiliate or subsidiary of the entity.
(f) TERRORIST COUNTRY DEFINED.—A country shall be consid-
ered to be a terrorist country for purposes of a contract covered
by this section if the Secretary of State has determined pursuant
to law, as of the date that is 60 days before the date on which
the contract is signed, that the government of that country is
a government that has repeatedly provided support for acts of
international terrorism.
(g) EFFECTIVE DATE.—This section shall apply with respect
to contracts entered into after the expiration of the 90-day period
beginning on the date of the enactment of this Act, or after the
expiration of the 30-day period beginning on the date of publication
in the Federal Register of the final regulations referred to in sub-
section (b), whichever is earlier.
(h) TERMINATION.—This section expires on September 30, 1996.
SEC. 844. DEPARTMENT OF DEFENSE PURCHASES THROUGH OTHER
AGENCIES.
(a) REGULATIONS REQUIRED.—Not later than six months after
the date of the enactment of this Act, the Secretary of Defense
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H. R. 2401—175
shall prescribe regulations governing the exercise by the Depart-
ment of Defense of the authority under section 1535 of title 31,
United States Code, to purchase goods and services under contracts
entered into or administered by another agency.
(b) CONTENT
OF REGULATIONS.—The regulations prescribed
pursuant to subsection (a) shall—
(1) require that each purchase described in subsection (a)
be approved in advance by a contracting officer of the Depart-
ment of Defense with authority to contract for the goods or
services to be purchased or by another official in a position
specifically designated by regulation to approve such purchase;
(2) provide that such a purchase of goods or services may
be made only if—
(A) the purchase is appropriately made under a con-
tract that the agency filling the purchase order entered
into, before the purchase order, in order to meet the
requirements of such agency for the same or similar goods
or services;
(B) the agency filling the purchase order is better
qualified to enter into or administer the contract for such
goods or services by reason of capabilities or expertise
that is not available within the Department;
(C) the agency or unit filling the order is specifically
authorized by law or regulations to purchase such goods
or services on behalf of other agencies; or
(D) the purchase is authorized by an Executive order
or a revision to the Federal Acquisition Regulation setting
forth specific additional circumstances in which purchases
referred to in subsection (a) are authorized;
(3) prohibit any such purchase under a contract or other
agreement entered into or administered by an agency not cov-
ered by the provisions of chapter 137 of title 10, United States
Code, or title III of the Federal Property and Administrative
Services Act of 1949 and not covered by the Federal Acquisition
Regulation unless the purchase is approved in advance by
the Senior Acquisition Executive responsible for purchasing
by the ordering agency or unit; and
(4) prohibit any payment to the agency filling a purchase
order of any fee that exceeds the actual cost or, if the actual
cost is not known, the estimated cost of entering into and
administering the contract or other agreement under which
the order is filled.
(c) MONITORING SYSTEM REQUIRED.—The Secretary of Defense
shall ensure that, not later than one year after the date of the
enactment of this Act, systems of the Department of Defense for
collecting and evaluating procurement data are capable of collecting
and evaluating appropriate data on procurements conducted under
the regulations prescribed pursuant to subsection (a).
(d) TERMINATION.—This section shall cease to be effective one
year after the date on which final regulations prescribed pursuant
to subsection (a) take effect.
SEC. 845. AUTHORITY OF THE ADVANCED RESEARCH PROJECTS
AGENCY TO CARRY OUT CERTAIN PROTOTYPE PROJECTS.
(a) AUTHORITY.—The Director of the Advanced Research
Projects Agency may, under the authority of section 2371 of title
10, United States Code, carry out prototype projects that are directly
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H. R. 2401—176
relevant to weapons or weapon systems proposed to be acquired
or developed by the Department of Defense.
(b) EXERCISE OF AUTHORITY.—(1) Subsections (c)(2) and (c)(3)
of such section 2371, as redesignated by section 827(b)(1)(B), shall
not apply to projects carried out under subsection (a).
(2) The Director shall, to the maximum extent practicable,
use competitive procedures when entering into agreements to carry
out projects under subsection (a).
(c) PERIOD OF AUTHORITY.—The authority of the Director to
carry out projects under subsection (a) shall terminate 3 years
after the date of the enactment of this Act.
SEC. 846. IMPROVEMENT OF PRICING POLICIES FOR USE OF MAJOR
RANGE AND TEST FACILITY INSTALLATIONS OF THE MILI-
TARY DEPARTMENTS.
(a) IN GENERAL.—Chapter 159 of title 10, United States Code,
is amended by inserting after section 2680 the following new section:
‘‘§ 2681. Use of test and evaluation installations by commer-
cial entities
‘‘(a) CONTRACT AUTHORITY.—The Secretary of Defense may
enter into contracts with commercial entities that desire to conduct
commercial test and evaluation activities at a Major Range and
Test Facility Installation.
‘‘(b) TERMINATION OR LIMITATION OF CONTRACT UNDER CERTAIN
CIRCUMSTANCES.—A contract entered into under subsection (a) shall
contain a provision that the Secretary of Defense may terminate,
prohibit, or suspend immediately any commercial test or evaluation
activity to be conducted at the Major Range and Test Facility
Installation under the contract if the Secretary of Defense certifies
in writing that the test or evaluation activity is or would be
detrimental—
‘‘(1) to the public health and safety;
‘‘(2) to property (either public or private); or
‘‘(3) to any national security interest or foreign policy
interest of the United States.
‘‘(c) CONTRACT PRICE.—A contract entered into under subsection
(a) shall include a provision that requires a commercial entity
using a Major Range and Test Facility Installation under the con-
tract to reimburse the Department of Defense for all direct costs
to the United States that are associated with the test and evaluation
activities conducted by the commercial entity under the contract.
In addition, the contract may include a provision that requires
the commercial entity to reimburse the Department of Defense
for such indirect costs related to the use of the installation as
the Secretary of Defense considers to be appropriate. The Secretary
may delegate to the commander of the Major Range and Test
Facility Installation the authority to determine the appropriateness
of the amount of indirect costs included in such a contract provision.
‘‘(d) RETENTION
OF FUNDS COLLECTED FROM COMMERCIAL
USERS.—Amounts collected under subsection (c) from a commercial
entity conducting test and evaluation activities at a Major Range
and Test Facility Installation shall be credited to the appropriation
accounts under which the costs associated with the test and evalua-
tion activities of the commercial entity were incurred.
‘‘(e) REGULATIONS AND LIMITATIONS.—The Secretary of Defense
shall prescribe regulations to carry out this section.
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H. R. 2401—177
‘‘(f) DEFINITIONS.—In this section:
‘‘(1) The term ‘Major Range and Test Facility Installation’
means a test and evaluation installation under the jurisdiction
of the Department of Defense and designated as a Major Range
and Test Facility Installation by the Secretary.
‘‘(2) The term ‘direct costs’ includes the cost of—
‘‘(A) labor, material, facilities, utilities, equipment, sup-
plies, and any other resources damaged or consumed during
test or evaluation activities or maintained for a particular
commercial entity; and
‘‘(B) construction specifically performed for a commer-
cial entity to conduct test and evaluation activities.
‘‘(g) TERMINATION OF AUTHORITY.—The authority provided to
the Secretary of Defense by subsection (a) shall terminate on
September 30, 1998.
‘‘(h) REPORT.—Not later than January 1, 1998, the Secretary
of Defense shall submit to Congress a report describing the number
and purposes of contracts entered into under subsection (a) and
evaluating the extent to which the authority under this section
is exercised to open Major Range and Test Facility Installations
to commercial test and evaluation activities.’’.
(b) CLERICAL AMENDMENT.—The table of sections at the begin-
ning of such chapter is amended by inserting after the item related
to section 2680 the following new item:
‘‘2681. Use of test and evaluation installations by commercial entities.’’.
SEC. 847. CONTRACT BUNDLING.
(a) STUDY REQUIRED.—The Comptroller General shall conduct
a study regarding the impact of contract bundling on the participa-
tion of small business concerns (including small business concerns
owned and controlled by socially and economically disadvantaged
individuals) in procurement by the Department of Defense.
(b) PURPOSES OF STUDY.—In addition to such other matters
as the Comptroller General considers appropriate, the study
required by subsection (a) shall—
(1) catalog the benefits and adverse effects of contract
bundling on Department of Defense contracting activities;
(2) catalog the benefits and adverse effects of contract
bundling on small business concerns seeking to sell goods or
services to the Department of Defense;
(3) catalog and assess the adequacy of the policy guidance
applicable to procurement personnel of the Department of
Defense regarding the bundling of contract requirements;
(4) review and analyze the data compiled pursuant to sub-
section (c) regarding the extent to which procuring activities
of the Department of Defense have been bundling their require-
ments for the procurement of goods and services (including
construction);
(5) review and assess the adequacy of the statements
submitted by procuring activities of the Department of Defense
pursuant to section 15(a) of the Small Business Act (15 U.S.C.
644(a)) regarding bundling of contract requirements; and
(6) assess whether small business specialists of the Depart-
ment of Defense or procurement center representatives of the
Small Business Administration have adequate policy guidance
and effective authority to make an independent assessment
regarding proposed bundling of contract requirements.
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