A bill to amend title 10, United States Code, to codify in that title certain defense-related permanent free-standing provisions of law.
PL 100-370 (H.R.4229), enacted 07/19/1988

102 STAT. 840 
PUBLIC LAW 100-370—JULY 19, 1988 
Public Law 100-370 
100th Congress 
An Act 
July 19, 1988 
To amend title 10, United States Code, to codify in that title certain defense-related 
[H.R. 4229] 
permanent free-standing provisions of law. 
Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled. 
Armed 
SECTION 1. CODIFICATION OF CERTAIN PERMANENT PROVISIONS OF 
Forces. 
LAW IN TITLE 10, UNITED STATES CODE. 
(a) ENUSTMENT QUAUFICATIONS.—(1) Section 5200>) of title 10, 
United States Code, is amended by striking out the period at the end 
and inserting in lieu thereof the following: "; however, a person may 
not be denied enlistment in the armed forces solely because of his 
not having a high school diploma if his enlistment is needed to meet 
established strength requirements.". 
(2) Section 3262 of title 10, United States Code, is amended by 
striking out "Of' and inserting in lieu thereof "Notwithstanding 
section 520(b) of this title, of. 
(3) Section 401 of the Department of Defense Supplemental Appro-
10 use 520 note, priation Authorization Act, 1974 (Public Law 93-307; 88 Stat. 234), is 
repealed. 
(b) CAP ON NUMBER OF GENERAL AND FLAG OFFICERS ON ACTIVE 
DUTY.—(1) Chapter 32 of title 10, United States Ckxie, is amended— 
(A) by redesignating section 526 as section 527; and 
(B) by inserting after section 525 the following new section 
526: 
10 use 526. 
"§526. Authorized strength: general and flag ofHcers on active 
duty 
"The total number of general ofRcers on active duty in the Army, 
Air Force, and Marine (>)rps and flag officers on active duty in the 
Navy may not exceed 1,073.". 
(2XA) Section 527 (as redesignated by paragraph (IXA)) is amended 
by striking out "or 525" and inserting in lieu thereof "525, or 526". 
(B) The heading of such section is amended to read as follows: 
"§527. Authority to suspend sections 523, 524, 525, and 526". 
(3) The table of sections at the beginning of such chapter is 
amended by striking out the item relating to section 526 and 
inserting in lieu thereof the following: 
"526. Authorized strength: general and flag officers on active duty. 
"527. Authority to suspend sections 523, 524, 525, and 526.". 
(4) Section 811(a) of the Department of Defense Appropriation 
Authorization Act, 1978 (10 U.S.C. 523 note), is repealed. 
(c) COMMISSARY AND EXCHANGE EUGIBILITY.—(1) Part II of subtitle 
A of title 10, United States C!ode, is amended by inserting after 
chapter 53 the following new chapter: 
PUBLIC LAW 100-370—JULY 19, 1988 
102 STAT. 841 
•CHAPTER 54—COMMISSARY AND EXCHANGE BENEFITS 
"Sec. 
"1061. Survivors of certain Reserve and Guard members. 
"1062. Certain former spouses. 
"1063. Period for use of commissary stores: eligibility attributable to active duty for 
training. 
"§ 1061. Survivors of certain Reserve and Guard members 
10 use 1061. 
"(a) BENEFITS.—The Secretary of Defense shall prescribe regula- Regulations. 
tions to allow dependents of members of the uniformed services 
described in subsection (b) to use commissary and exchange stores 
on the same basis as dependents of members of the uniformed 
services who die while on active duty for a period of more than 30 
days. 
"(b) COVERED DEPENDENTS.—A dependent referred to in subsection 
(a) is a dependent of a member of a uniformed service who died— 
"(1) while on active duty, active duty for training, or inactive-
duty training (regardless of the period of such duty); or 
"(2) while traveling to or from the place at which the member 
was to perform, or has performed, active duty, active duty for 
training, or inactive-duty training (regardless of the period of 
such duty). 
"§ 1062. Certain former spouses 
10 use 1062. 
"The Secretary of Defense shall prescribe such regulations as may Regulations. 
be necessary to provide that an unremarried former spouse de-
scribed in subparagraph (FXi) of section 1072(2) of this title is 
entitled to commissary and exchange privileges to the same extent 
and on the same basis as the surviving spouse of a retired member of 
the uniformed services.". 
(2XA) Section 1052 of such title is transferred to the end of chapter 
54 of such title (as added by paragraph (1)) and redesignated as 
section 1063. 
(B) The table of sections at the beginning of chapter 53 of such 
title is amended by striking out the item relating to such section 
1052. 
(3) The tables of chapters at the banning of subtitle A, and at the 
beginning of part II of subtitle A, of such title are each amended by 
inserting after the item relating to chapter 53 the following new 
item: 
"54. Commissary and Exchange Benefits 
1061". 
(4) Section 308 of the Department of Defense Authorization Act, 
1986 (Public Law 99-145; 99 Stat. 618), is repealed. 
10 use 1052 
(5) Section 1005 of the Uniformed Services Former Spouses' note. 
Protection Act (10 U.S.C. 1408 note) is repealed. 
(d) FINANCIAL MANAGEMENT.—-(IXA) Chapter 131 of title 10, 
United States Code, is amended by inserting before section 2202 the 
following new section: 
**§2201. Apportionment of funds: authority for exemption; ex- 10 use 2201. 
cepted expenses 
"(a) EXEMPTION FROM APPORTIONMENT REQUIREMENT.—If the Contracts. 
President determines such action to be necessary in the interest of 
national defense, the President may exempt from the provisions of 
section 1512 of title 31 appropriations, funds, and contract 
102 STAT. 842 
PUBLIC LAW 100-370—JULY 19, 1988 
authorizations available for military functions of the Department of 
Defense. 
"(b) AIRBORNE ALERTS.—Upon a determination by the President 
that such action is necessary, the Secretary of Defense may provide 
for the cost of an airborne alert as an excepted expense under 
section 3732(a) of the Revised Statutes (41 U.S.C. 11(a)). 
"(c) MEMBERS ON ACTIVE DUTY.—Upon a determination by the 
President that it is necessary to increase (subject to limits imposed 
by law) the number of members of the armed forces on active duty 
beyond the number for which funds are provided in appropriation 
Acts for the Department of Defense, the Secretary of Defense may 
provide for the cost of such additional members as an excepted 
expense under section 3732(a) of the Revised Statutes (41 U.S.C. 
11(a)). 
"(d) NOTIFICATION TO CONGRESS.—The Secretary of Defense— 
"(1) shall immediately notify Congress of the use of any 
authority under this section; and 
Reports. 
"(2) shall Submit monthly reports to Congress on the esti-
mated obligations incurred pursuant to subsections (b) and (c).". 
(B) Section 8009 of the Department of Defense Appropriations Act, 
1986 (as contained in section 101(b) of Public Law 99-190 (99 Stat. 
10 use 114 note. 1204)), is repealed. 
(2XA) Chapter 131 of title 10, United States Code, is further 
amended by inserting after section 2211 the following new section: 
10 use 2212. 
"§2212. Contracted advisory and assistance services: accounting 
procedures 
"(a) ACCOUNTING PROCEDURE.—The Secretary of Defense shall 
require that there be maintained within each military department 
an accounting procedure to aid in the identification and control of 
expenditures for services identified as contracted advisory and 
assistance services. 
"(h) REGULATIONS TO IDENTIFY CONTRACTED ADVISORY AND ASSIST-
ANCE SERVICES.—(1) The Secretary shall prescribe regulations which 
specifically describe— 
"(A) those services which the Department of Defense consid-
ers to be contracted advisory and assistance services; and 
"(B) of those services, which services are carried out in direct 
support of a weapons system and are essential to the develop-
ment, production, or maintenance of the system. 
"(2) In prescribing regulations under paragraph (1), the Secretary 
shall consider the following areas: 
"(A) Maneigement and professional services. 
"(B) Special studies and analyses. 
"(C) Management and support services for research and devel-
opment activities. 
"(D) Training. 
"(E) Management review of program funded organizations. 
"(F) Public relations. 
"(G) Other consulting services. 
"(H) Engineering development and operational systems devel-
opment related to research and development activities and 
production activities. 
"(I) Technical assistance. 
"(J) Technical representation. 
"(K) Quality control, testing, and inspection services. 
"(L) Specialized medical services. 
PUBLIC LAW 100-370—JULY 19, 1988 
102 STAT. 843 
"(M) Architectural and engineering services, other than in 
connection with construction. 
"(N) Technical and management assistance for weapons sys-
tems management and review. 
"(c) CONGRESSIONAL BUDGET DOCUMENTS.—Budget documents pre-
sented to Congress in support of the budget for the Department of 
Defense for any fiscal year— 
"(1) shall identify the total amount requested for contracted 
advisory and sissistance services (as defined under regulations 
prescribed under subsection (b)); 
"(2) shall identify the amount requested for each category of 
such services established by regulations prescribed under 
subsection (b); and 
"(3) within each such category, shall separately set forth 
amounts for such services described in subsection (bXlXB).". 
(B) Section 918 of the Defense Procurement Improvement Act of 
1985 (title IX of Public Law 99-145) is repealed. 
lO use 2304 
(3XA) Chapter 131 of title 10, United States Code, is further 
note. 
amended by adding at the end the following new section: 
"§ 2217. Comparable budgeting for common procurement weapon 
10 use 2217. 
systems 
"(a) MATTERS TO BE INCLUDED IN ANNUAL DEFENSE BUDGETS.—In 
preparing the defense budget for any fiscal year, the Secretary of 
Defense shall— 
"(1) specifically identify each common procurement weapon 
system included in the budget; 
"(2) take all feasible steps to minimize variations in procure-
ment unit costs for any such system as shown in the budget 
requests of the different armed forces requesting procurement 
funds for the system; and 
"(3) identify and justify in the budget all such variations in 
procurement unit costs for common procurement weapon 
systems. 
"(b) (COMPTROLLER.—The Secretary shall carry out this section 
through the (DomptroUer of the Department of Defense. 
"(c) DEFINITIONS.—In this section: 
"(1) The term 'defense budget' means the budget of the 
Department of Defense included in the President's budget 
submitted to Congress under section 1105 of title 31 for a fiscal 
year. 
"(2) The term 'common procurement weapon system' means a 
weapon system for which two or more of the Army, Navy, Air 
Force, and Marine CJorps request procurement funds in a 
defense budget.". 
(B) Section 955 of the Defense Acquisition Improvement Act of 
1986 is repealed. 
10 use 113 note. 
(4) The table of sections at the beginning of chapter 131 of title 10 
United States Ck)de, is amended— 
(A) by inserting before the item relating to section 2202 the 
following new item: 
"2201. Apportionment of funds: authority for exemption; excepted expenses."; 
(B) by inserting after the item relating to section 2211 the 
following new item: 
"2212. Contracted advisory and assistance services: accounting procedures."; 
and 
102 STAT. 844 
PUBLIC LAW 100-370—JULY 19, 1988 
(C) by adding at the end the following new item: 
"2217. Comparable budgeting for common procurement weapon systems.". 
(e) MISCELLANEOUS ADMINISTRATIVE PROVISIONS.—(1) Subtitle A of 
title 10, United States Code, is amended by inserting after chapter 
133 the following new chapter: 
"CHAPTER 134—MISCELLANEOUS ADMINISTRATIVE 
PROVISIONS 
"Subchapter 
Sec. 
"I. Miscellaneous Authorities, Prohibitions, and Limitations on the Use 2241 
of Appropriated Funds. 
"II. Miscellaneous Administrative Authority 
2251 
"SUBCHAPTER I—MISCELLANEOUS AUTHORITIES, PROHIBI-
TIONS, AND LIMITATIONS ON THE USE OF APPROPRI-
ATED FUNDS 
"Sec. 
"2241. Availability of appropriations for certain purposes. 
"2242. Authority to use appropriated funds for certain investigations and security 
services. 
10 use 2241. 
"§ 2241. Availability of appropriations for certain purposes 
"(a) OPERATION AND MAINTENANCE APPROPRIATIONS.—Amounts 
appropriated to the Department of Defense for operation and 
maintenance of the active forces may be used for the following 
purposes: 
"(1) Morale, welfare, and recreation. 
"(2) Modification of personal property. 
"(3) Design of vessels. 
"(4) Industrial mobilization. 
"(5) Military communications facilities on merchant vessels. 
"(6) Acquisition of services, special clothing, supplies, and 
equipment. 
"(7) Expenses for the Reserve Officers' Training Corps and 
other units at educational institutions. 
"(b) NECESSARY EXPENSES.—Amounts appropriated to the Depart-
ment of Defense may be used for all necessary expenses, at the seat 
of the Government or elsewhere, in connection with communication 
and other services and supplies that may be necessary for the 
national defense. 
10 use 2242. 
"§ 2242. Authority to use appropriated funds for certain investiga-
tions and security services 
"The Secretary of Defense and the Secretary of each military 
department may— 
"(1) pay in advance for the expenses of conducting investiga-
tions in foreign countries incident to matters relating to the 
Department of Defense, to the extent such expenses are deter-
mined by the investigating officer to be necessary and in accord 
with local custom; 
"(2) pay expenses incurred in connection with the administra-
tion of occupied areas; 
"(3) pay expenses of military courts, boards, and commissions; 
and 
PUBLIC LAW 100-370—JULY 19, 1988 
102 STAT. 845 
"(4) reimburse the Administrator of General Services for Classified 
security guard services furnished by the Administrator to the information. 
Department of Defense for the protection of confidential files. 
"SUBCHAPTER II—MISCELLANEOUS ADMINISTRATIVE 
AUTHORITY 
"Sec. 
"2251. Household furnishings and other property: personnel outside the United 
States or in Alaska or Hawaii. 
"2252. Rewards: missing property. 
"2253. Motor vehicles. 
"§ 2251. Household furnishings and other property: personnel out- 10 use 2251. 
side the United States or in Alaska or Hawaii 
"(a) IN GENERAL.—Subject to subsection (b), the Secretary of the 
military department concerned may— 
"(1) purchase household furnishings and automobiles from 
members of the armed forces and civilian employees of the 
Department of Defense on duty outside the United States or in 
Hawaii for resale at cost to incoming personnel; and 
"(2) provide household furnishings, without charge, in other 
than public quarters occupied by members of the armed forces 
or civilian employees of the Department of Defense who are on 
duty outside the United States or in Alaska or Hawaii. 
"(b) 
REQUIRED 
DETERMINATION.—The authority 
provided 
in 
subsection (a) may be used only when it is determined, under 
regulations approved by the Secretary of Defense, that the use of 
that authority would be advantageous to the United States. 
"§ 2252. Rewards: missing property 
"The Secretary of Defense and the Secretary of each military 
department may pay a reward of not more than $500 in any case for 
information leading to the discovery of missing property under the 
jurisdiction of that Secretary or leading to the recovery of such 
property. 
"§ 2253. Motor vehicles 
"(a) GENERAL AUTHORITIES.—The Secretary of Defense and the 
Secretary of each military department may— 
"(1) provide for insurance of official motor vehicles in a 
foreign country when the laws of such country require such 
insurance; and 
"(2) purchase right-hand drive vehicles at a cost of not more 
than $12,000 each. 
"(b) HIRE OF PASSENGER VEHICLES,—Amounts appropriated to the 
Department of Defense for operation and maintenance of the active 
forces may be used for the hire of passenger motor vehicles.". 
(2) The tables of chapters at the beginning of subtitle A, and at the 
beginning of part IV of subtitle A, of such title are each amended by 
inserting after the item relating to chapter 133 the following new 
item: 
"134. Miscellaneous Administrative Provisions 
2241". 
(3XA) Section 7209 of such title is repealed. 
(B) The table of sections at the beginning of chapter 631 of such 
title is amended by striking out the item relating to section 7209. 
10 use 2252. 
10 use 2253. 
Insurance. 
102 STAT. 846 
PUBLIC LAW 100-370—JULY 19, 1988 
(f) PROCUREMENT GENERALLY.—(IXA) Section 2307 of title 10, 
United States Code, is amended by adding at the end the following 
new subsection: 
"(eXD The Secretary of Defense shall ensure that any payment for 
work in progress (including materials, labor, and other items) under 
a defense contract that provides for such payments is commensurate 
with the work, which meets standards of quality established under 
the contract, that has been accomplished. 
"(2) The Secretary shall ensure that progress payments referred to 
in paragraph (1) are not made for more than 80 percent of the work 
accomplished under a defense contract so long as the Secretary has 
not made the contractual terms, specifications, and price definite. 
"(3) This subsection does not apply to contracts for amounts less 
than the maximum amount for small purchases specified in section 
2304(gX2) of this title.". 
(B) Section 916 of the Defense Procurement Improvement Act of 
10 use 2307 
1985 (title IX of Public Law 99-145; 99 Stat. 688) is repealed. 
note. 
(2XA) Section 2324(eXl) of such title (as amended by section 805 of 
Public Law 100-180) is amended by adding at the end the following 
new subparagraph: 
Insurance. 
"(L) CJosts of commercial insurance that protects against the 
costs of the contractor for correction of the contractor's own 
defects in materials or workmanship.". 
(B) Section 2399 of such title is repealed. 
(3XA) Section 2324 of such title is further amended— 
(i) by redesignating subsections (j) ^nd (k) as subsections (k) 
and (1), respectively; and 
(ii) by inserting after subsection (i) the following new subsec-
tion (j): 
"(j) In a proceeding before the Armed Services Board of Contract 
Appeals, the United States Claims Court, or any other Federal court 
in which the reasonableness of indirect costs for which a contractor 
seeks reimbursement from the Department of Defense is in issue, 
the burden of proof shall be upon the contractor to establish that 
those costs are resisonable.". 
(B) Section 933 of the Defense Procurement Improvement Act of 
10 use 2324 
1985 (title IX of Public Law 99-145; 99 Stat. 700) is repealed. 
note. 
(g) RESEARCH AND DEVELOPMENT.—(1) Section 2361 of title 10, 
United States Code, is transferred within chapter 139 to appear 
immediately before section 2352, redesignated as section 2351, and 
amended— 
(A) by inserting "(a)" before "Funds"; and 
(B) by adding at the end the following new subsection: 
"(b) Funds appropriated to the Department of Defense for re-
search and development may be used— 
"(1) for the purposes of section 2353 of this title; and 
"(2) for purposes related to research and development for 
which expenditures are specifically authorized in other appro-
priations of the Department of Defense.". 
(2) Section 8015 of the Department of Defense Appropriations Act, 
1986 (as contained in section 101(b) of Public Law 99-190 (99 Stat. 
10 use 2353 
1205)), is repealed, 
note. 
(3) Section 2358 of title 10, United States Code, is amended— 
(A) by inserting "(a) IN GENERAL.—" before "Subject to ap-
proval" in the first sentence; 
(B) by striking out "or his designee" both places it appears; 
and 
PUBLIC LAW 100-370—JULY 19, 1988 
102 STAT. 847 
(C) by adding at the end the following new subsection: 
"(b) REQUIREMENT OF POTENTIAL MIUTARY RELATIONSHIP.—Funds 
appropriated to the Department of Defense may not be used to 
finance any research project or study unless the project or study 
has, in the opinion of the Secretary of Defense, a potential relation-
ship to a military function or operation.". 
(4) The table of sections at the beginning of chapter 139 of title 10, 
United States Code, is amended— 
(A) by inserting before the item relating to section 2352 the 
following new item: 
"2351. Availability of appropriations."; 
^ 
and 
(B) by striking out the item relating to section 2361. 
(5) Section 204 of Public Law 91-441 (10 U.S.C. 2358 note) is 
repealed. 
(h) 
MISCELLANEOUS PROCUREMENT PROVISIONS.—(IXA) Section 
2389 of title 10, United States Code, is amended— 
(i) by inserting "(a)" before "Under regulations"; and 
(ii) by adding at the end the following new subsection: 
"(bXl) Funds appropriated to the Department of Defense may be Dairy products, 
used to purchase for enlisted members milk made available to the 
Department of Defense under section 202 of the Agricultural Act of 
1949 (7 U.S.C. 1446a). 
"(2) The cost of milk so purchased (as determined by the Secretary 
of E)efense) shall be included in the value of the commuted ration of 
enlisted members.". 
(B) The heading of such section is amended to read, as follows: 
"§ 2389. Contracts for the procurement of milk: price adjustments; 
purchases from the Commodity Credit Corporation". 
(2) Chapter 141 of such title is amended by adding at the end the 
following new sections: 
"§ 2410. Contract claims: certincation 
10 USC 2410. 
"A contract claim, request for equitable adjustment to contract 
terms, request for relief under Public Law 85-804 (50 U.S.C. 1431 et 
seq.), or other similar request by a contractor that exceeds $100,000 
may not be paid unless a senior official of the contractor in charge 
at the plant or location involved certifies at the time the claim or 
request is submitted that— 
"(1) the claim or request is made in good faith; and 
"(2) all supporting data submitted in connection with the 
claim or request are accurate and complete to the best of such 
official's knowledge and belief. 
"§ 2410a. Appropriated funds: availability for certain contracts for 10 USC 2410a. 
12 months 
"Funds appropriated to the Department of Defense for a fiscal 
year shall be available for payments under contracts for any of the 
following purposes for 12 months beginning at any time during the 
fiscal year: 
"(1) The maintenance of tools and facilities. 
"(2) The lease of real or personal property, including the Real property. 
maintenance of such property when contracted for as part of 
the lease agreement. 
"(3) Depot maintenance.". 
102 STAT. 848 
PUBLIC LAW 100-370—JULY 19, 1988 
(3) The table of sections at the beginning of such chapter is 
amended— 
(A) by striking out the item relating to section 2389 and 
inserting in lieu thereof the following: 
"2389. Contracts for the procurement of milk: price adjustments; purchases from the 
Commodity Credit Corporation."; 
(B) by striking out the item relating to section 2399; and 
(C) by adding at the end the following new items: 
"2410. Contract claims: certification. 
"2410a. Appropriated funds: availability for certain contracts for 12 months.". 
(i) OVERSIGHT OF MAJOR PROGRAMS.—(1) Section 2435 of title 10, 
United States Code, is amended by adding at the end the following 
new subsection: 
"(c) STABILITY OF PROGRAM MANAGERS.—(1) The tour of duty of an 
officer of the armed forces as a program manager of a major defense 
acquisition program shall be (A) not less than four years, or (B) until 
completion of a major program milestone (as defined in regulations 
prescribed by the Secretary of Defense). 
"(2) The Secretary of the military department concerned may 
waive the length of the tour of duty prescribed in paragraph (1). The 
authority under the preceding sentence may not be delegated.". 
(2) Section 1243 of the Defense Procurement Reform Act of 1984 
10 use 2432 
(title XII of Public Law 98-525; 98 Stat. 2609) is repealed, 
note. 
(j) UTIUTIES AND SERVICES.—(1) Chapter 147 of title 10, United 
States Code, is amended by adding at the end the following new 
section: 
10 use 2490. 
"§ 2490. Utility services: furnishing for certain buildings 
"Appropriations for the Department of Defense may be used for 
utility services for— 
"(1) buildings constructed at private cost, as authorized by 
law; and 
"(2) buildings on military reservations authorized by regula-
tion to be used for morale, welfare, and recreational purposes.". 
(2) The table of sections at the beginning of such chapter is 
amended by adding at the end the following new item: 
"2490. Utility services: furnishing for certain buildings.". 
(k) INTERDEPARTMENTAL TRANSFER OF VESSELS.—(1) Chapter 153 of 
title 10, United States Code, is amended by adding at the end the 
following new section: 
10 use 2578. 
"§ 2578. Vessels: transfer between departments 
"A vessel under the jurisdiction of a military department may be 
transferred or otherwise made available without reimbursement to 
another military department or to the Department of Transpor-
tation, and a vessel under the jurisdiction of the Department of 
Transportation may be transferred or otherwise made available 
without reimbursement to a military department. Any such transfer 
may be made only upon the request of the Secretary of the military 
department concerned or the Secretary of Transportation, as the 
case may be, and with the approval of the Secretary of the depart-
ment having jurisdiction of the vessel.". 
(2) The table of sections at the beginning of such chapter is 
amended by adding at the end the following new item: 
PUBLIC LAW 100-370—JULY 19, 1988 
102 STAT. 849 
"2578. Vessels: transfer between departments.". 
(3) Section 8012 of the Department of Defense Appropriations Act, 
1986 (as contained in section 101(b) of Public Law 99-190 (40 U.S.C 
483a)), is repealed. 
(1) REAL PROPERTY.—(1) Chapter 159 of title 10, United States 
Code, is amended by inserting after section 2672a the following new 
section: 
"§ 2673. Acquisition of certain interests in land: availability of 10 USC 2673. 
funds 
"Appropriations available to the Department of Defense for 
maintenance or construction may be used for the acquisition of land 
or interests in land under section 2672 of this title and for the 
acquisition of interests in land under section 2675 of this title.". 
(2) Section 2828 of such title is amended by adding at the end the 
following new subsection: 
"(h) Appropriations available to the Department of Defense for 
maintenance or construction may be used for the acquisition of 
interests in land under this section.". 
(3) Chapter 159 of such title is further amended by inserting after 
the table of sections the following new section: 
"§2661. Miscellaneous administrative provisions relating to real lo use 2661. 
property 
"(a) Appropriations for operation and maintenance of the active 
forces shall be available for the following: 
"(1) The repair of facilities. 
"(2) The installation of equipment in public and private 
plants. 
"(b) The Secretary of Defense and the Secretary of each military 
department may provide for the following: 
"(1) The leasing of buildings and facilities (including the Contracts. 
payment of rentals for special purpose space at the seat of 
Government). Rental for such leases may be paid in advance in 
connection with— 
"(A) the conduct of field exercises and maneuvers; and 
"(B) the administration of the Act of July 9, 1942 (43 
U.S.C. 315q). 
"(2) The maintenance of defense access roads which are cer- Highways. 
tified to the Secretary of Transportation as important to the 
national defense under the provisions of section 210 of title 23.". 
(4) The table of sections at the beginning of such chapter is 
amended— 
(A) by inserting before the item relating to section 2662 the 
following new item: 
"2661. Miscellaneous administrative provisions relating to real property."; 
and 
(B) by inserting after the item relating to section 2672a the 
following new item: 
"2673. Acquisition of certain interests in land: availability of funds.". 
(m) AccouNTABiUTY AND RESPONSIBILITY.—(1) Chapter 165 of title 
10, United States Code, is amended by adding at the end the 
following new section: 
102 STAT. 850 
PUBLIC LAW 100-370—JULY 19, 1988 
10 use 2781. 
"§ 2781. Availability of appropriations: exchange fees; losses in 
accounts 
"Amounts appropriated to the Department of Defense may be 
used for— 
"(1) exchange fees; and 
"(2) losses in the accounts of disbursing officials and agents in 
accordance with law.". 
(2) The table of sections at the beginning of such chapter is 
amended by adding at the end the following new item: 
"2781. Availability of appropriations: exchange fees; losses in accounts.". 
(n) SHIP OVERHAUL WORK.—(1) Chapter 633 of title 10, United 
States Code, is amended by adding at the end the following new 
section: 
Contracts. 
"§7313. Ship Overhaul work: availability of appropriations for 
10 use 7313. 
unusual cost overruns and for changes in scope of work 
"(a) UNUSUAL COST OVERRUNS.—(1) Appropriations available to 
the Department of Defense for a fiscal year may be used for pay-
ment of unusual cost overruns incident to ship overhaul, mainte-
nance, and repair for a vessel inducted into an industrial-fund 
activity or contracted for during a prior fiscal year. 
"(2) The Secretary of Defense shall notify Congress promptly 
before an obligation is incurred for any payment under paragraph 
"0)) CHANGES IN SCOPE OF WORK.—An appropriation available to 
the Department of Defense for a fiscal year may be used after the 
otherwise-applicable expiration of the availability for obligation of 
that appropriation— 
' (1) for payments to an industrial-fund activity for amounts 
required because of changes in the scope of work for ship 
overhaul, maintenance, and repair, in the case of work inducted 
into the industrial-fund activity during the fiscal year; and 
"(2) for payments under a contract for amounts required 
because of changes in the scope of work, in the case of a contract 
entered into during the fiscal year for ship overhaul, mainte-
nance, and repair.". 
(2) The table of sections at the beginning of such chapter is 
amended by adding at the end the following new item: 
"7313. Ship overhaul work: availability of appropriations for unusual cost overruns 
and for changes in scope of work.". 
(o) ANNUAL REPORT ON STATIONING FORCES OVERSEAS.—(1) Section 
113 of title 10, United States Code (as amended by section 1214 of 
Public Law 100-180), is amended by adding at the end the following 
new subsection: 
"(kXD Not later than April 8 of each year, the Secretary of 
Defense shall submit to the Committees on Armed Services and 
Committees on Appropriations of the Senate and House of Rep-
resentatives a report on the cost of stationing United States forces 
outside of the United States. Each such report shall include a 
detlailed statement of the following: 
"(A) Costs incurred in the United States and costs incurred 
outside the United States in connection with the stationing of 
United States forces outside the United States. 
"(B) The costs incurred outside the United States in connec-
tion with operating, maintaining, and supporting United States 
PUBLIC LAW 100-370—JULY 19, 1988 
102 STAT. 851 
forces outside the United States, including all direct and in-
direct expenditures of United States funds in connection with 
such stationing. 
"(C) The effect of such expenditures outside the United States 
on the balance of payments of the United States. 
"(2) Each report under this subsection shall be prepared in con-
sultation with the Secretary of Commerce. 
"(3) In this subsection, the term 'United States', when used in a 
geographic sense, includes the territories and possessions of the 
United States.". 
(2) Section 8042 of the Department of Defense Appropriations Act, 
1988 (as contained in section 101(b) of Public Law 100-202 (101 Stat. 
1329-69)), is repealed. 
10 USC113 note, 
(p) GENERAL REPEALS.—The following provisions of law are 
(1) Sections 705, 707, 723, 728, and 735 of the Department of 
Defense Appropriation Act, 1984 (Public Law 98-212; 97 Stat. 
1437 et seq.). 
lO USC 114 note. 
(2) Section 8078 of the Department of Defense Appropriations 
Act, 1985 (as contained in section 101(h) of Public Law 98-473 
(98 Stat. 1938)). 
lo use 2304 
(3) Sections 8005 and 8006 of the Department of Defense note. 
Appropriations Act, 1986 (as contained in section 101(b) of 
Public Law 99-190 (99 Stat. 1185)). 
10 USC 114 note. 
(4) Section 813 of the Department of Defense Appropriation 
Authorization Act, 1979 (Public Law 95-485; 92 Stat. 1624). lo USC 2304 
SEC. 2. CODIFICATION OF LAWS RELATING TO CONTRACTING FOR "°^ 
PERFORMANCE OF CIVILIAN FUNCTIONS. 
(a) CoNSOUDATioN AND CODIFICATION.—(1) Part IV of subtitle A of 
title 10, United States CJode, is amended by inserting after chapter 
145 the following new chapter: 
"CHAPTER 146—CONTRACTING FOR PERFORMANCE 
OF 
CIVILIAN 
COMMERCIAL 
OR 
INDUSTRIAL 
TYPE 
FUNCTIONS 
"Sec. 
"2461. Commercial or industrial type functions: required studies and reports before 
conversion to contractor performance. 
"2462. Contracting for certain supplies and services required when cost is lower. 
"2463. Reports on savings or costs from increased use of DOD civilian personnel. 
"2464. Core logistics functions. 
"2465. Prohibition on contracts for performance of flrefighting or security-guard 
functions. 
'*§ 2461. Commercial or industrial type functions: required studies lo use 2461. 
and reports before conversion to contractor perform-
ance 
"(a) REQUIRED NOTICE TO (I!ONGRESS.—A commercial or industrial 
t3T)e function of the Department of Defense that on October 1,1980, 
was being performed by Department of Defense civilian employees 
may not be converted to performance by a private contractor unless 
the Secretary of Defense provides to (Dongress in a timely manner— 
"(1) notification of any decision to study such function for 
possible performance by a private contractor; 
''(2) a detailed summary of a comparison of the cost of 
performance of such function by Department of Defense civilian 
employees and by private contractor which demonstrates that 
102 STAT. 852 
PUBLIC LAW 100-370—JULY 19, 1988 
the performance of such function by a private contractor will 
result in a cost savings to the Government over the life of the 
contract and a certification that the entire cost comparison is 
available; 
"(3) a certification that the Government calculation for the 
cost of performance of such function by Department of Defense 
civilian employees is based on an estimate of the most efficient 
and cost effective organization for performance of such function 
by Department of Defense civilian employees; and 
"(4) a report, to be submitted with the certification required 
by paragraph (3), showing— 
"(A) the potential economic effect on employees affected, 
and the potential economic effect on the local community 
and Federal Government if more than 75 employees are 
involved, of contracting for performance of such function; 
"(B) the effect of contracting for performance of such 
function on the military mission of such function; and 
"(C) the amount of the bid accepted for the performance 
of such function by the private contractor whose bid is 
accepted and the cost of performance of such function by 
Department of Defense civilian employees, together with 
costs and expenditures which the Government will incur 
because of the contract. 
"(b) CONGRESSIONAL NOTIFICATION OF DECISION TO CONVERT.—If, 
after completion of the studies required for completion of the certifi-
cation and report required by paragraphs (3) and (4) of subsection 
(a), a decision is made to convert the function to contractor perform-
ance, the Secretary of Defense shall notify Congress of such decision. 
"(c) ANNUAL REPORTS.—Not later than February 1 of each fiscal 
year, the Secretary of Defense shall submit to Congress a written 
report describing the extent to which commercial and industrial 
type functions were performed by Department of Defense contrac-
tors during the preceding fiscal year. The Secretary shall include in 
each such report an estimate of the percentage of commercial and 
industrial type functions of the Department of Defense that will be 
performed by Department of Defense civilian employees, and the 
percentage of such functions that will be performed by private 
contractors, during the fiscal year during which the report is 
submitted. 
"(d) WAIVER FOR SMALL FUNCTIONS.—Subsections (a) through (c) 
shall not apply to a commercial or industrial type function of the 
Department of Defense that is being performed by 45 or fewer 
Department of Defense civilian employees. 
"(e) ADDITIONAL LIMITATIONS.—(1) A commercial or industrial type 
function of the Department of Defense that on October 1, 1980, w£is 
being performed by Department of Defense civilian employees may 
not be converted to performance by a private contractor to cir-
cumvent a civilian personnel ceiling. 
"(2) In no case may a commercial or industrial tjrpe function being 
performed by Department of Defense personnel be modified, reorga-
nized, divided, or in any way changed for the purpose of exempting 
from the requirements of subsection (a) the conversion of all or any 
part of such function to performance by a private contractor. 
"(f) INAPPUCABIUTY DURING WAR OR EMERGENCY.—The provisions 
of this section shall not apply during war or during a period of 
national emergency declared by the President or Congress. 
PUBLIC LAW 100-370—JULY 19, 1988 
102 STAT. 853 
"§2462. Contracting for certain supplies and services required 
10USC2462. 
when cost is lower 
"(a) IN GENERAL.—Except as otherwise provided by law, the Sec-
retary of Defense shall procure each supply or service necessary for 
or beneficial to the accomplishment of the authorized functions of 
the Department of Defense (other than functions which the Sec-
retary of Defense determines must be performed by military or 
Government personnel) from a source in the private sector if such a 
source can provide such supply or service to the Department at a 
cost that is lower (after including any cost differential required by 
law, Executive order, or regulation) than the cost at which the 
Department can provide the same supply or service. 
"(b) REAUSTIC AND FAIR COST COMPARISONS.—For the purpose of 
determining whether to contract with a source in the private sector 
for the performance of a Department of Defense function on the 
basis of a comparison of the costs of procuring supplies or services 
from such a source with the costs of providing the same supplies or 
services by the Department of Defense, the Secretary of Defense 
i 
shall ensure that all costs considered (including the costs of quality 
assurance, technical monitoring of the performance of such func-
tion, liability insurance, employee retirement and disability bene-
fits, and all other overhead costs) are realistic and fair. 
"§ 2463. Reports on savings or costs from increased use of DOD lo use 2463. 
civilian personnel 
"(a) IN GENERAL.—Whenever during a fiscal year to which this Records. 
section applies the performance of a commercial or industrial type 
activity of the Department of Defense that is being performed by 50 
or more employees of a private contractor is changed to performance 
by civilian employees of the Department of Defense, the Secretary of 
Defense shall maintain data in which a comparison is made of the 
estimated costs of (1) continued performance of such activity by 
private contractor employees, and (2) performance of such activity 
by civilian employees of the Department of Defense. 
"(b) SEMIANNUAL REPORT ON COSTS AND SAVINGS.—As soon as 
practicable after the end of the first six months, and after the end of 
the second six months, of a fiscal year to which this section applies, 
the Secretary of Defense shall submit to the Committees on Armed 
Services and the Committee on Appropriations of the Senate and 
House of Representatives a report showing the estimated savings or 
loss to the United States, during the preceding six-month period, 
that is reflected in the data maintained under subsection (a). 
"(c) APPUCABIUTY OF SECTION.—This section applies only with 
respect to a fiscal year during which there is no statutory limit 
(commonly known as an 'end strength') on the number of civilian 
employees that may be employed by the Department of Defense as 
of the last day of that fiscal year. 
"§ 2464. Core logistics functions 
10 USC 2464. 
"(a) NECESSITY FOR CORE LOGISTICS CAPABILITY.—(1) It is essential 
for the national defense that Department of Defense activities main-
tain a logistics capability (including personnel, equipment, and 
facilities) to ensure a ready and controlled source of technical 
competence and resources necessary to ensure effective and timely 
response to a mobilization, national defense contingency situations, 
and other emergency requirements. 
102 STAT. 854 
PUBLIC LAW 100-370—JULY 19, 1988 
"(2) The Secretary of Defense shall identify those logistics activi-
ties that are necessary to maintain the logistics capability described 
in paragraph (1). 
"(b) LIMITATION ON CONTRACTING.—(1) Except as provided in para-
graph (2), performance of a logistics activity identified by the Sec-
retary under subsection (aX2), and performance of a function of the 
Department of Defense described in section 1231(b) of the Depart-
ment of Defense Authorization Act, 1986 (Public Law 99-145; 99 
Stat. 731), may not be contracted for performance by non-Govern-
ment personnel under the procedures and requirements of Office of 
Management and Budget Circular A-76 or any successor adminis-
trative regulation or policy (hereinafter in this section referred to as 
OMB Circular A-76). 
"(2) The Secretary of Defense may waive paragraph (1) in the case 
of any such logistics activity or function and provide that perform-
ance of such activity or function shall be considered for conversion 
to contractor performance in accordance with OMB Circular A-76. 
Regulations. 
Any such waiver shall be made under regulations prescribed by the 
Secretary and shall be based on a determination by the Secretary 
that Government performance of the activity or function is no 
longer required for national defense reasons. Such regulations shall 
include criteria for determining whether Government performance 
of any such activity or function is no longer required for national 
defense reasons. 
"(3) A waiver under paragraph (2) may not take effect until— 
Reports- 
"(A) the Secretary submits a report on the waiver to the 
Committees on Armed Services and the Committee on Appro-
priations of the Senate and House of Representatives; and 
"(B) a period of 20 days of continuous session of Congress or 40 
calendar days has passed after the receipt of the report by those 
committees. 
"(4) For purposes of paragraph (3XB), the continuity of a session of 
Congress is broken only by an adjournment sine die, and the days on 
which either House is not in session because of an adjournment of 
more than three days to a day certain are excluded in the computa-
tion of such 20-day period.". 
(2) The tables of chapters at the beginning of subtitle A, and at the 
beginning of part IV of subtitle A, of such title are amended by 
inserting after the item relating to chapter 145 the following new 
item: 
"146. Contracting for Performance of Civilian Commercial or Industrial 
Type Functions 
2461". 
(b) TRANSFER OF SECTION.—(1) Section 2693 of title 10, United 
States Code, is transferred to the end of chapter 146 of such title (as 
added by subsection (a)) and is redesignated as section 2465. 
(2) The table of sections at the beginning of chapter 159 of such 
title is amended by striking out the item relating to section 2693. 
(c) CONFORMING REPEALS.—The following provisions of laws are 
repealed: 
(1) Section 502 of the Department of Defense Authorization 
Act, 1981 (10 U.S.C. 2304 note). 
(2) Section 307 of the Department of Defense Authorization 
Act, 1985 (10 U.S.C. 2304 note). 
(3) Sections 1223 and 1224 of the Department of Defense 
Authorization Act, 1987 (10 U.S.C. 2304 note). 
PUBLIC LAW 100-370—JULY 19, 1988 
102 STAT. 855 
SEC. 3. CODIFICATION OF DEFENSE-RELATED BUY AMERICAN LAWS. 
(a) CoNSOUDATiON AND CODIFICATION.—(1) Part IV of Subtitle A of 
title 10, United States Code, is amended by inserting after chapter 
147 the following new chapter: 
"CHAPTER 148—BUY AMERICAN REQUIREMENTS 
"Sec. 
"2501. Limitation on use of funds: procurement of goods which are other than 
American goods. 
"2502. Miscellaneous procurement limitations. 
v: 
"§ 2501. Limitation on use of funds: procurement of goods which 10 USC 2501. 
are other than American goods 
"(a) Funds appropriated to the Department of Defense may not be 
obligated under a contract for procurement of goods which are other 
than American goods (as defined in subsection (c)) unless adequate 
consideration is given to the following: 
"(1) The bids or proposals of firms located in labor surplus 
areas in the United States (as designated by the Department of 
Labor) which have offered to furnish American goods. 
"(2) The bids or proposals of small business firms in the 
United States which have offered to furnish American goods. 
"(3) The bids or proposals of all other firms in the United 
States which have offered to furnish American goods. 
"(4) The United States balance of payments. 
"(5) The cost of shipping goods which are other than Amer-
ican goods. 
"(6) Any duty, tariff, or surcharge which may enter into the 
cost of using goods which are other than American goods. 
"(h) Consideration of the matters referred to in paragraphs (1) 
through (6) of subsection (a) shall be given under regulations of the 
Secretary of Defense and subject to the determinations and excep-
tions contained in title III of the Act of March 3, 1933 (41 U.S.C. 10a, 
10b), popularly known as the 'Buy American Act'. 
"(c) In this section, the term goods which are other than Amer-
ican goods' means— 
"(1) an end product that is not mined, produced, or manufac-
tured in the United States; or 
"(2) an end product that is manufactured in the United States 
but which includes components mined, produced, or manufac-
tured outside the United States the aggregate cost of which 
exceeds the aggregate cost of the components of such end 
product that are mined, produced, or manufactured in the 
United States.". 
(2) The tables of chapters at the beginning of subtitle A, and at the 
beginning of part IV of subtitle A, of such title are amended by 
inserting after the item relating to chapter 147 the following new 
item: 
"148. Buy American Requirements 
2501". 
(b) TRANSFER OF SECTION.—(1) Section 2400 of such title is trans-
ferred to the end of chapter 148 of such title (as added by subsection 
(a)), redesignated as section 2502, and amended in the second sen-
tence of subsection (a) by striking out "this section" and inserting in 
lieu thereof "this subsection". 
(2) The table of sections at the beginning of chapter 141 of such 
title is amended by striking out the item relating to section 2400. 
102 STAT. 856 
PUBLIC LAW 100-370—JULY 19, 1988 
(c) CONFORMING REPEAL.—Section 707 of the Department of De-
fense Appropriation Authorization Act, 1975 (Public Law 93-365; 10 
U.S.C. 2301 note), is repealed. 
10 u s e 101 note. 
SEC. 4. LEGISLATIVE CONSTRUCTION. 
(a) REFERENCES TO REPLACED LAWS.—A reference to a law replaced 
by the provisions of title 10, United States Code, enacted by this Act 
(including a reference in a regulation, order, or other law) shall be 
treated as referring to the corresponding provision enacted by this 
Act. 
(b) SAVINGS PROVISION FOR REGULATIONS.—A regulation, rule, or 
order in effect under a law replaced by the provisions of title 10, 
United States CJode, enacted by this Act shall continue in effect 
under the corresponding provision enacted by this Act until re-
pealed, amended, or superseded. 
(c) GENERAL SAVINGS PROVISION.—An action taken or an offense 
committed under a law replaced by the provisions of title 10, United 
States Code, enacted by this Act shall be treated as having been 
taken or committed under the corresponding provision enacted by 
this Act. 
Approved July 19, 1988. 
LEGISLATIVE HISTORY—H.R. 4229: 
HOUSE REPORTS: No. 100-696 (Comm. on Armed Services). 
CONGRESSIONAL RECORD, Vol. 134 (1988): 
June 20, considered and passed House. 
July 6, considered and passed Senate.