H. R. 5122—256
metals were incorporated into items produced, manufactured, 
or assembled in the United States before the date of the enact-
ment of this Act with respect to which the contracting officer 
for the contract determines that the contractor is not in compli-
ance with section 2533b of title 10, United States Code (as 
added by subsection (a)(1)), if—
(A) the contracting officer for the contract determines 
in writing that—
(i) it would not be practical or economical to remove 
or replace the specialty metals incorporated in such 
items or to substitute items containing compliant mate-
rials; 
(ii) the prime contractor and subcontractor respon-
sible for providing items containing non-compliant 
materials have in place an effective plan to ensure 
compliance with section 2533b of title 10, United States 
Code (as so added), with regard to items containing 
specialty metals if such metals were incorporated into 
items produced, manufactured, or assembled in the 
United States after the date of the enactment of this 
Act; and 
(iii) the non-compliance is not knowing or willful; 
and 
(B) the Under Secretary of Defense for Acquisition, 
Technology, and Logistics or the service acquisition execu-
tive of the military department concerned approves the 
determination. 
(2) NOTICE.—Not later than 15 days after a contracting 
officer makes a determination under paragraph (1)(A) with 
respect to a contract, the contracting officer shall post a notice 
on FedBizOpps.gov that a waiver has been granted for the 
contract under this subsection. 
(3) 
DEFINITION.—In 
this 
subsection, 
the 
term 
‘‘FedBizOpps.gov’’ means the website maintained by the Gen-
eral Services Administration known as FedBizOpps.gov (or any 
successor site). 
(4) TERMINATION OF AUTHORITY.—A contracting officer may 
exercise the authority under this subsection only with respect 
to the delivery of items the final acceptance of which takes 
place after the date of the enactment of this Act and before 
September 30, 2010. 
SEC. 843. STRATEGIC MATERIALS PROTECTION BOARD. 
(a) IN GENERAL.—Chapter 7 of title 10, United States Code, 
is amended by adding at the end the following new section: 
‘‘§ 187. Strategic Materials Protection Board 
‘‘(a) ESTABLISHMENT.—(1) The Secretary of Defense shall estab-
lish a Strategic Materials Protection Board. 
‘‘(2) The Board shall be composed of representatives of the 
following: 
‘‘(A) The Secretary of Defense, who shall be the chairman 
of the Board. 
‘‘(B) The Under Secretary of Defense for Acquisition, Tech-
nology, and Logistics. 
‘‘(C) The Under Secretary of Defense for Intelligence. 
‘‘(D) The Secretary of the Army.
H. R. 5122—257
‘‘(E) The Secretary of the Navy. 
‘‘(F) The Secretary of the Air Force. 
‘‘(b) DUTIES.—In addition to other matters assigned to it by 
the Secretary of Defense, the Board shall—
‘‘(1) determine the need to provide a long term domestic 
supply of materials designated as critical to national security 
to ensure that national defense needs are met; 
‘‘(2) analyze the risk associated with each material des-
ignated as critical to national security and the effect on national 
defense that the nonavailability of such material from a 
domestic source would have; 
‘‘(3) recommend a strategy to the President to ensure the 
domestic availability of materials designated as critical to 
national security; 
‘‘(4) recommend such other strategies to the President as 
the Board considers appropriate to strengthen the industrial 
base with respect to materials critical to national security; 
and 
‘‘(5) publish not less frequently than once every two years 
in the Federal Register recommendations regarding materials 
critical to national security, including a list of specialty metals, 
if any, recommended for addition to, or removal from, the 
definition of ‘specialty metal’ for purposes of section 2533b 
of this title. 
‘‘(c) MEETINGS.—The Board shall meet as determined necessary 
by the Secretary of Defense but not less frequently than once 
every two years to make recommendations regarding materials 
critical to national security as described in subsection (b)(5). 
‘‘(d) REPORTS.—After each meeting of the Board, the Board 
shall prepare and submit to Congress a report containing the results 
of the meeting and such recommendations as the Board determines 
appropriate.’’. 
(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:
‘‘187. Strategic Materials Protection Board.’’.
(c) FIRST MEETING OF BOARD.—The first meeting of the Stra-
tegic Materials Protection Board, established by section 187 of 
title 10, United States Code (as added by subsection (a)) shall 
be not later than 180 days after the date of the enactment of 
this Act. 
Subtitle E—Other Matters 
SEC. 851. REPORT ON FORMER DEPARTMENT OF DEFENSE OFFICIALS 
EMPLOYED BY CONTRACTORS OF THE DEPARTMENT OF 
DEFENSE. 
(a) REPORT REQUIRED.—Not later than December 1, 2007, the 
Comptroller General shall submit to the Committees on Armed 
Services of the Senate and House of Representatives a report on 
the employment of former officials of the Department of Defense 
by major defense contractors during the most recent calendar year 
for which, in the judgment of the Comptroller General, data are 
reasonably available. The report shall assess the extent to which
H. R. 5122—258
former officials of the Department of Defense who served in acquisi-
tion-related positions were provided compensation by major defense 
contractors during such calendar year. 
(b) OBJECTIVES
OF
REPORT.—The objectives of the report 
required by subsection (a) shall be to determine the effectiveness 
of existing statutes and regulations governing the employment of 
former Department of Defense officials by defense contractors, 
including section 207 of title 18, United States Code, and section 
27 of the Office of Federal Procurement Policy Act (41 U.S.C. 
423). At a minimum, the report shall assess the extent to which 
such former officials who receive compensation from defense con-
tractors have been assigned by those contractors to work on—
(1) Department of Defense contracts or programs for which 
such former officials personally had program oversight responsi-
bility or decision-making authority when they served in the 
Department of Defense; or 
(2) Department of Defense contracts or programs which 
are the responsibility of the agency, office, or command in 
which such former officials served in the Department of 
Defense. 
(c) CONFIDENTIALITY REQUIREMENT.—The report required by 
subsection (a) shall not include the names of specific former Depart-
ment of Defense officials who receive compensation from defense 
contractors or information from which such individuals could be 
identified. 
(d) ACCESS TO INFORMATION.—In accordance with the contract 
clause required pursuant to section 2313(c) of title 10, United 
States Code, a major defense contractor shall provide the Comp-
troller General access to information requested by the Comptroller 
General for the purpose of this review regarding former officials 
of the Department of Defense who have received compensation 
from the contractor during the relevant calendar year. 
(e) DEFINITIONS.—In this section: 
(1) MAJOR DEFENSE CONTRACTOR.—The term ‘‘major defense 
contractor’’ includes any company that received more than 
$500,000,000 in contract awards from the Department of 
Defense in fiscal year 2005. 
(2) FORMER DEPARTMENT OF DEFENSE OFFICIAL.—The term 
‘‘former Department of Defense official’’ means either of the 
following: 
(A) A former Department of Defense employee. 
(B) A former or retired member of the Armed Forces. 
SEC. 852. REPORT AND REGULATIONS ON EXCESSIVE PASS-THROUGH 
CHARGES. 
(a) COMPTROLLER
GENERAL
REPORT
ON
EXCESSIVE
PASS-
THROUGH CHARGES.—
(1) IN GENERAL.—Not later than 180 days after the date 
of the enactment of this Act, the Comptroller General shall 
issue a report on pass-through charges on contracts or sub-
contracts (or task or delivery orders) that are entered into 
for or on behalf of the Department of Defense. 
(2) MATTERS COVERED.—The report issued under this sub-
section—
H. R. 5122—259
(A) shall assess the extent to which the Department 
of Defense has paid excessive pass-through charges to con-
tractors who provided little or no value to the performance 
of the contract; 
(B) shall assess the extent to which the Department 
has been particularly vulnerable to excessive pass-through 
charges on any specific category of contracts or by any 
specific category of contractors (including any category of 
small business); and 
(C) shall determine the extent to which any prohibition 
on excessive pass-through charges would be inconsistent 
with existing commercial practices for any specific category 
of contracts or have an unjustified adverse effect on any 
specific category of contractors (including any category of 
small business). 
(b) REGULATIONS REQUIRED.—
(1) IN GENERAL.—Not later than May 1, 2007, the Secretary 
of Defense shall prescribe regulations to ensure that pass-
through charges on contracts or subcontracts (or task or 
delivery orders) that are entered into for or on behalf of the 
Department of Defense are not excessive in relation to the 
cost of work performed by the relevant contractor or subcon-
tractor. 
(2) SCOPE
OF
REGULATIONS.—The regulations prescribed 
under this subsection—
(A) shall not apply to any firm, fixed-price contract 
or subcontract (or task or delivery order) that is—
(i) awarded on the basis of adequate price competi-
tion; or 
(ii) for the acquisition of a commercial item, as 
defined in section 4(12) of the Office of Federal Procure-
ment Policy Act (41 U.S.C. 403(12)); and 
(B) may include such additional exceptions as the Sec-
retary determines to be necessary in the interest of the 
national defense. 
(3) DEFINITION.—In this section, 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 subcon-
tractor that is for overhead or profit on work performed by 
a lower-tier contractor or subcontractor (other than charges 
for the direct costs of managing lower-tier contracts and sub-
contracts and overhead and profit based on such direct costs). 
(4) REPORT.—Not later than one year after the date of 
the enactment of this Act, the Secretary of Defense shall submit 
to the congressional defense committees a report on the steps 
taken to implement the requirements of this subsection, 
including—
(A) any standards for determining when no, or neg-
ligible, value has been added to a contract by a contractor 
or subcontractor; 
(B) any procedures established for preventing excessive 
pass-through charges; and 
(C) any exceptions determined by the Secretary to be 
necessary in the interest of the national defense.