[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[S. 1587 Engrossed Amendment House (EAH)]

103d CONGRESS

  2d Session

                                S. 1587

_______________________________________________________________________

                               AMENDMENT
                In the House of Representatives, U. S.,

                                                         June 27, 1994.
      Resolved, That the bill from the Senate (S. 1587) entitled ``An 
Act to revise and streamline the acquisition laws of the Federal 
Government, and for other purposes'', do pass with the following

                               AMENDMENT:

        Strike out all after the enacting clause, and insert:

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Federal Acquisition Improvement Act 
of 1994''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.

                      TITLE I--CONTRACT FORMATION

                    Subtitle A--Competition Statutes

                  Part I--Armed Services Acquisitions

                  subpart a--competition requirements
Sec. 1001. References to Federal Acquisition Regulation.
Sec. 1002. Establishment or maintenance of alternative sources of 
                            supply.
Sec. 1003. Clarification of approval authority for use of procedures 
        subpart b--planning, solicitation, evaluation, and award.
Sec. 1011. Source selection factors.
Sec. 1012. Solicitation provision regarding evaluation of purchase 
                            options.
Sec. 1013. Prompt notice of award.
Sec. 1014. Post-award debriefings.
Sec. 1015. Protest file.
Sec. 1016. Agency decisions on protests.
Sec. 1017. Award of msubpart c--kinds of contracts
Sec. 1021. Repeal of requirement for secretarial determination 
                            regarding use of cost type or incentive 
     subpart d--miscellaneous provisions for the encouragement of 
                              competition
Sec. 1031. Repeal of requirement for annual report by advocates for 
                            competition.

                 Part II--Civilian Agency Acquisitions

                  subpart a--competition requirements
Sec. 1051. References to Federal Acquisition Regulation.
Sec. 1052. Establishment or maintenance of alternative sources of 
                            supply.
Sec. 1053. Clarification of approval authority for use of procedures 
        subpart b--planning, solicitation, evaluation, and award.
Sec. 1061. Solicitation, evaluation, and award.
Sec. 1062. Solicitation provision regarding evaluation of purchase 
                            options.
Sec. 1063. Prompt notice of award.
Sec. 1064. Post-award debriefings.
Sec. 1065. Protest file.
Sec. 1066. Agency decisions on protests.
Sec. 1067. Award of msubpart c--kinds of contracts
Sec. 1071. Repeal of agency head determination regarding use of cost 
                            type or incentive contract.
Sec. 1072. Multiyear contracting authority.
Sec. 1073. Severable services contracts crossing fiscal years.

                    Part III--Acquisitions Generally

Sec. 1091. Policy regarding consideration of contractor past 
                            performance.
Sec. 1092. Repeal of requirement for annual report on competition.
Sec. 1093. Discouragement of nonstandard contract clauses.

                   Subtitle B--Truth in Negotiations

                  Part I--Armed Services Acquisitions

Sec. 1201. Stabilization of dollar threshold of applicability.
Sec. 1202. Exceptions to cost or pricing data requirements.
Sec. 1203. Right of United States to examine contractor records.
Sec. 1204. Consistency of time references.
Sec. 1205. Repeal of superseded provision.

                 Part II--Civilian Agency Acquisitions

Sec. 1251. Revision of civilian agency provisions to ensure uniform 
                            treatment of cost or pricing data.
Sec. 1252. Repeal of obsolete provision.

                  Subtitle C--Research and Development

Sec. 1301. Competition requirement for awards of grants and contracts 
                            to nonprofit organizations.

                    Subtitle D--Procurement Protests

              Part I--Protests to the Comptroller General

Sec. 1401. Protest defined.
Sec. 1402. Review of protests and effect on contracts pending decision.
Sec. 1403. Decisions on protests.
Sec. 1404. Regulations.

     Part II--Protests in Procurements of Automatic Data Processing

Sec. 1431. Revocation of delegations of procurement authority.
Sec. 1432. Authority of the General Services Administration Board of 
                            Contract Appeals.
Sec. 1433. Periods for certain actions.
Sec. 1434. Dismissals of protests.
Sec. 1435. Award of costs.
Sec. 1436. Dismissal agreements.
Sec. 1437. Matters to be covered in regulations.
Sec. 1438. Definition of protest.
Sec. 1439. Oversight of acquisition of automatic data processing 
                            equipment by Federal agencies.

           Subtitle E--Policy, Definitions, and Other Matters

                  Part I--Armed Services Acquisitions

Sec. 1501. Congressional defense procurement policy.
Sec. 1502. Definitions.
Sec. 1503. Delegation of procurement functions.
Sec. 1504. Determinations and decisions.
Sec. 1505. Restrictions on undefinitized contractual actions.
Sec. 1506. Repeal of requirement relating to production special tooling 
                            and production special test equipment.
Sec. 1507. Regulations for bids.

                 Part II--Civilian Agency Acquisitions

Sec. 1551. Definitions.
Sec. 1552. Delegation of procurement functions.
Sec. 1553. Determinations and decisions.
Sec. 1554. Repeals.
Sec. 1555. Cooperative purchasing.

                   TITLE II--CONTRACT ADMINISTRATION

                      Subtitle A--Contract Payment

                  Part I--Armed Services Acquisitions

Sec. 2001. Contract financing.
Sec. 2002. Repeal of vouchering procedures section.

                 Part II--Civilian Agency Acquisitions

Sec. 2051. Contract financing.

                    Part III--Acquisitions Generally

Sec. 2061. Interest penalty on contract close-out lag-time.

                      Subtitle B--Cost Principles

                  Part I--Armed Services Acquisitions

Sec. 2101. Allowable contract costs.
Sec. 2102. Repeal of authority for contract profit controls during 
                            emergency periods.

                 Part II--Civilian Agency Acquisitions

Sec. 2151. Allowable contract costs.
Sec. 2152. Revision of cost principle relating to entertainment, gift, 
                            and recreation costs for contractor 
                            employees.

                    Part III--Acquisitions Generally

Sec. 2161. Travel expenses of government contractors.

                Subtitle C--Audit and Access to Records

                  Part I--Armed Services Acquisitions

Sec. 2201. Consolidation and revision of authority to examine records 
                            of contractors.

                 Part II--Civilian Agency Acquisitions

Sec. 2251. Authority to examine records of contractors.

                 Subtitle D--Cost Accounting Standards

Sec. 2301. Repeal of obsolete deadline regarding procedural regulations 
                            for the Cost Accounting Standards Board.

 Subtitle E--Administration of Contract Provisions Relating to Price, 
                     Delivery, and Product Quality

Sec. 2401. Clarification of provision relating to quality control of 
                            certain spare parts.
Sec. 2402. Contractor guarantees regarding weapon systems.

                    Subtitle F--Claims and Disputes

Sec. 2501. Certification of contract claims.
Sec. 2502. Shipbuilding claims.

         TITLE III--MAJOR SYSTEMS AND SERVICE SPECIFIC STATUTES

                   Subtitle A--Major Systems Statutes

Sec. 3001. Weapon development and procurement schedules.
Sec. 3002. Selected Acquisition Report requirement.
Sec. 3003. Unit cost report requirement.
Sec. 3004. Requirement for independent cost estimate and manpower 
                            estimate before development or production.
Sec. 3005. Baseline description.
Sec. 3006. Repeal of requirement for competitive prototyping for major 
                            programs.
Sec. 3007. Repeal of requirement for competitive alternative sources 
                            for major programs.

                      Subtitle B--Testing Statutes

Sec. 3011. Authorization of less than full-up testing.
Sec. 3012. Limitation on quantities to be procured for low-rate initial 
                            production.
Sec. 3013. Operational test and evaluation of defense acquisition 
                            programs.

                  Subtitle C--Civil Reserve Air Fleet

Sec. 3021. Definition of contractor.
Sec. 3022. Consolidation of provisions relating to contractual 
                            commitment of aircraft.
Sec. 3023. Use of military installations by contractors.

                       Subtitle D--Miscellaneous

Sec. 3051. Regulations on procurement, production, warehousing, and 
                            supply distribution functions.
Sec. 3052. Repeal of requirements regarding product evaluation 
                            activities.
Sec. 3053. Codification and revision of limitation on lease of vessels, 
                            aircraft, and vehicles.
Sec. 3054. Repeal of application of Public Contracts Act to certain 
                            naval vessel contracts.

  TITLE IV--SIMPLIFIED ACQUISITION THRESHOLD AND SOCIOECONOMIC, SMALL 
                    BUSINESS, AND MISCELLANEOUS LAWS

              Subtitle A--Simplified Acquisition Threshold

                   Part I--Establishment of Threshold

Sec. 4001. Establishment of simplified acquisition threshold.
Sec. 4002. Federal acquisition computer network architecture.
Sec. 4003. Implementation in Armed Services.
Sec. 4004. Implementation in civilian agencies.

                 Part II--Simplification of Procedures

Sec. 4011. Procedures for purchases below micro-purchase threshold.
Sec. 4012. Procurement notice.
Sec. 4013. GAO test and report on performance of simplified acquisition 
                            threshold.

  Part III--Inapplicability of Laws to Acquisitions Not in Excess of 
                    Simplified Acquisition Threshold

                          subpart a--generally
Sec. 4021. Inapplicability of future enacted procurement laws to 
                            contracts not exceeding the simplified 
                 subpart b--armed services acquisitions
Sec. 4031. Inapplicability of certain provisions of law.
Sec. 4032. Conforming amendments relating to inapplicability of certain 
                subpart c--civilian agency acquisitions
Sec. 4041. Inapplicability of certain provisions of law.
Sec. 4042. Conforming amendments relating to inapplicability of certain 
                   subpart d--acquisitions generally
Sec. 4051. Conformance of certain procurement integrity requirements.
Sec. 4052. Inapplicability of the Drug-Free Workplace Act of 1988.

                     Part IV--Conforming Amendments

Sec. 4071. Armed Services acquisitions.
Sec. 4072. Civilian agency acquisitions.
Sec. 4073. Office of Federal Procurement Policy Act.

                    Part V--Revision of Regulations

Sec. 4081. Revision required.

           Subtitle B--Socioeconomic and Small Business Laws

Sec. 4101. Small business provisions.
Sec. 4102. Payment protections for subcontractors and suppliers.
Sec. 4103. Extension of test program for negotiation of comprehensive 
                            small business subcontracting plans.
Sec. 4104. Small Business Procurement Advisory Council.
Sec. 4105. Maximum practicable opportunities for apprentices on Federal 
                            construction projects.

               Subtitle C--Miscellaneous Acquisition Laws

Sec. 4151. Restriction on use of noncompetitive procedures for 
                            procurement from a specified source.
Sec. 4152. Repeal of obsolete provision.

                     TITLE V--STANDARDS OF CONDUCT

Sec. 5001. Contracting functions performed by Federal personnel.
Sec. 5002. Repeal of executed requirement for study and report.
Sec. 5003. Interests of Members of Congress.
Sec. 5004. Waiting period for significant changes proposed for 
                            acquisition regulations.
Sec. 5005. Repeal of superseded and obsolete laws.

                TITLE VI--DEFENSE TRADE AND COOPERATION

Sec. 6001. Exception to Buy American Act for micro-purchases.
Sec. 6002. Policy on purchase of foreign goods.
Sec. 6003. Consolidation of miscellaneous procurement limitations.
Sec. 6004. Repeal of obsolete and redundant provisions.

                      TITLE VII--COMMERCIAL ITEMS

                Subtitle A--Definitions and Regulations

Sec. 7001. Definitions.
Sec. 7002. Regulations on acquisition of commercial items.

                Subtitle B--Armed Services Acquisitions

Sec. 7101. Establishment of new chapter in title 10.
Sec. 7102. Definitions.
Sec. 7103. Preference for acquisition of commercial items.
Sec. 7104. Exception to cost or pricing data requirements for 
                            commercial items.
Sec. 7105. Principle of construction with future laws.
Sec. 7106. Inapplicability of certain provisions of law.
Sec. 7107. Conforming amendments relating to inapplicability of certain 
                            provisions of law.

                Subtitle C--Civilian Agency Acquisitions

Sec. 7201. Definitions.
Sec. 7202. Preference for acquisition of commercial items.
Sec. 7203. Exception to cost or pricing data requirements for 
                            commercial items.
Sec. 7204. Principle of construction with future laws.
Sec. 7205. Inapplicability of certain provisions of law.
Sec. 7206. Conforming amendments relating to inapplicability of certain 
                            provisions of law.

                   Subtitle D--Acquisitions Generally

Sec. 7301. Conforming amendment relating to inapplicability of certain 
                            provisions of law.
Sec. 7302. Flexible deadlines for submission of offers of commercial 
                            items.
Sec. 7303. Additional responsibilities for advocates for competition.
Sec. 7304. Provisions not affected.
Sec. 7305. Comptroller General review of Federal Government use of 
                            market research.

                  TITLE VIII--MISCELLANEOUS PROVISIONS

Sec. 8001. Test program.
Sec. 8002. Study of participation by certain small businesses in 
                            Federal procurement.
Sec. 8003. Furtherance of contract goal for small disadvantaged 
                            businesses and certain institutions of 
                            higher education.
Sec. 8004. Education and training.
Sec. 8005. Department of Defense acquisition of intellectual property 
                            rights.
Sec. 8006. Sense of Congress on negotiated rulemaking.
Sec. 8007. Vendor and employee excellence awards.
Sec. 8008. Codification of accounting requirement for contracted 
                            advisory and assistance services.
Sec. 8009. Technical and clerical amendments.

               TITLE IX--EFFECTIVE DATES AND REGULATIONS

Sec. 9001. Effective dates.
Sec. 9002. Regulations.
Sec. 9003. Evaluation by the Comptroller General.

                      TITLE I--CONTRACT FORMATION

                    Subtitle A--Competition Statutes

                  PART I--ARMED SERVICES ACQUISITIONS

                  Subpart A--Competition Requirements

SEC. 1001. REFERENCES TO FEDERAL ACQUISITION REGULATION.

    Section 2304 of title 10, United States Code, is amended--
            (1) in subsection (a)(1)(A), by striking out 
        ``modifications'' and all that follows through ``note)'' and 
        inserting in lieu thereof ``Federal Acquisition Regulation''; 
        and
            (2) in subsection (g)(1), by striking out ``regulations 
        modified'' and all that follows through ``note)'' and inserting 
        in lieu thereof ``Federal Acquisition Regulation''.

SEC. 1002. ESTABLISHMENT OR MAINTENANCE OF ALTERNATIVE SOURCES OF 
              SUPPLY.

    (a) Prohibition on Use of Classes of Purchases or Contracts.--
Section 2304(b) of title 10, United States Code, is amended--
            (1) by redesignating paragraphs (2) and (3) as paragraphs 
        (3) and (4), respectively;
            (2) by inserting after paragraph (1) the following new 
        paragraph (2):
    ``(2) A determination under paragraph (1) may not be made for a 
class of purchases or contracts.''; and
            (3) in paragraph (4), as redesignated by paragraph (1), by 
        striking out ``paragraphs (1) and (2)'' and inserting in lieu 
        thereof ``paragraphs (1) and (3)''.
    (b) Additional Justification for Establishing or Maintaining 
Alternative Sources.--Section 2304(b)(1) of such title is amended--
            (1) by striking out ``or'' at the end of subparagraph (B);
            (2) by striking out the period at the end of subparagraph 
        (C) and inserting in lieu thereof a semicolon; and
            (3) by adding at the end the following new subparagraphs:
            ``(D) would ensure the continuous availability of a 
        reliable source of supply of such property or service;
            ``(E) would satisfy projected needs for such property or 
        service determined on the basis of a history of high demand for 
        the property or service; or
            ``(F) in the case of medical supplies, safety supplies, or 
        emergency supplies, would satisfy a critical need for such 
        supplies.''.

SEC. 1003. CLARIFICATION OF APPROVAL AUTHORITY FOR USE OF PROCEDURES 
              OTHER THAN FULL AND OPEN COMPETITION.

    Section 2304(f)(1)(B)(i) of title 10, United States Code, is 
amended by inserting before the semicolon at the end the following: 
``or by an official referred to in clause (ii), (iii), or (iv)''.

        Subpart B--Planning, Solicitation, Evaluation, and Award

SEC. 1011. SOURCE SELECTION FACTORS.

    (a) Content of Solicitation.--Section 2305(a) of title 10, United 
States Code, is amended--
            (1) in paragraph (2)--
                    (A) in subparagraph (A)(i)--
                            (i) by striking out ``(and significant 
                        subfactors)'' and inserting in lieu thereof 
                        ``and significant subfactors'',
                            (ii) by inserting after ``price-related 
                        factors'' the following: ``and subfactors'', 
                        and
                            (iii) by inserting after ``nonprice-related 
                        factors'' the following: ``and subfactors''; 
                        and
                    (B) in subparagraph (B)(ii), by striking out 
                subclause (I) and inserting in lieu thereof the 
                following:
                    ``(I) either a statement that the proposals are 
                intended to be evaluated with, and award made after, 
                discussions with the offerors, or a statement that the 
                proposals are intended to be evaluated, and award made, 
                without discussions with the offerors (other than 
                discussions conducted for the purpose of minor 
                clarification) unless discussions are determined to be 
                necessary; and''; and
            (2) by striking out paragraph (3) and inserting in lieu 
        thereof the following:
    ``(3)(A) In prescribing the evaluation factors to be included in 
each solicitation for competitive proposals, an agency head--
            ``(i) shall clearly establish the relative importance 
        assigned to the evaluation factors and subfactors, including 
        the quality of the product or services to be provided 
        (including technical capability, management capability, prior 
        experience, and past performance of the offeror);
            ``(ii) shall include cost or price to the Federal 
        Government as an evaluation factor that must be considered in 
        the evaluation of proposals; and
            ``(iii) shall disclose to offerors whether all evaluation 
        factors other than cost or price, when combined, are--
                    ``(I) significantly more important than cost or 
                price;
                    ``(II) approximately equal in importance to cost or 
                price; or
                    ``(III) significantly less important than cost or 
                price.
    ``(B) The regulations implementing clause (iii) of subparagraph (A) 
may not define the terms `significantly more important' and 
`significantly less important' as specific numeric weights that would 
be applied uniformly to all solicitations.
    ``(4) Nothing in this subsection prohibits an agency from--
            ``(A) providing additional information in a solicitation, 
        including numeric weights for all evaluation factors and 
        subfactors; or
            ``(B) stating in a solicitation that award will be made to 
        the offeror that meets the solicitation's mandatory 
        requirements at the lowest cost or price.''.
    (b) Authority To Apply Amendments Early.--The head of an agency may 
apply the amendments made by this section to solicitations issued 
before the effective date specified in section 9001(a) and to contracts 
awarded pursuant to those solicitations. The head of the agency shall 
publish in the Federal Register notice of any such earlier date of 
application at least 10 days before that date.

SEC. 1012. SOLICITATION PROVISION REGARDING EVALUATION OF PURCHASE 
              OPTIONS.

    Section 2305(a) of title 10, United States Code, as amended by 
section 1011, is further amended by adding at the end the following new 
paragraph:
    ``(4) The head of an agency, in issuing a solicitation for a 
contract to be awarded using sealed bid procedures, may not include in 
such solicitation a clause providing for the evaluation of prices under 
the contract for options to purchase additional supplies or services 
under the contract unless the head of the agency has determined that 
there is a reasonable likelihood that the options will be exercised.''.

SEC. 1013. PROMPT NOTICE OF AWARD.

    (a) Sealed Bid Procedures.--Paragraph (3) of section 2305(b) of 
title 10, United States Code, is amended--
            (1) in the last sentence, by striking out ``transmitting 
        written notice'' and inserting in lieu thereof ``transmitting, 
        in writing or by electronic means, notice''; and
            (2) by adding at the end the following: ``Within three days 
        after the date of contract award, the head of the agency shall 
        notify, in writing or by electronic means, each bidder not 
        awarded the contract that the contract has been awarded.''.
    (b) Competitive Proposals Procedures.--Paragraph (4)(B) of such 
section is amended in the second sentence--
            (1) by striking out ``transmitting written notice'' and 
        inserting in lieu thereof ``transmitting, in writing or by 
        electronic means, notice''; and
            (2) by striking out ``shall promptly notify'' and inserting 
        in lieu thereof ``, within three days after the date of 
        contract award, shall notify, in writing or by electronic 
        means,''.

SEC. 1014. POST-AWARD DEBRIEFINGS.

    Section 2305(b) of title 10, United States Code, is amended--
            (1) by redesignating paragraph (5) as paragraph (6); and
            (2) by inserting after paragraph (4) the following new 
        paragraph (5):
    ``(5)(A) When a contract is awarded by an agency on the basis of 
competitive proposals, an unsuccessful offeror, upon written request 
received by the agency within five days after the date of receipt of 
notification of the contract award, shall be debriefed and furnished 
the basis for the selection decision and contract award. The head of 
the agency shall debrief the offeror within, to the maximum extent 
practicable, five days after receipt of the request by the agency.
    ``(B) Such debriefing shall include, at a minimum, the following:
            ``(i) The agency's evaluation of the significant weak or 
        deficient factors in the offeror's offer.
            ``(ii) The overall evaluated cost of the offer of the 
        offeror awarded the contract and the overall evaluated cost of 
        the offer of the debriefed offeror.
            ``(iii) The overall ranking of all offers and the total 
        technical and cost scores of all offers.
            ``(iv) A summary of the rationale for the award.
            ``(v) In the case of an offer by the debriefed offeror that 
        includes a commercial item that is an end item under the 
        contract, the makes and models of similar commercial items 
        included in the offer of the offeror awarded the contract.
            ``(vi) Reasonable responses to questions posed by the 
        debriefed offeror as to whether source selection procedures set 
        forth in the solicitation, applicable regulations, and other 
        applicable authorities were followed by the agency.
    ``(C) The debriefing shall not include point-by-point comparisons 
of the debriefed offeror's offer with other offers and shall not 
disclose any information that is exempt from disclosure under section 
552 of title 5.
    ``(D) Each solicitation for competitive proposals shall include a 
statement that information described in subparagraph (B) may be 
disclosed in post-award debriefings.

    ``(E) The contracting officer shall include a summary of the 
debriefing in the contract file.''.

SEC. 1015. PROTEST FILE.

    Section 2305 of title 10, United States Code, is amended by adding 
at the end the following new subsection:
    ``(e) Protest File.--(1) If, in the case of a solicitation for a 
contract issued by, or an award or proposed award of a contract by, the 
head of an agency, a protest is filed pursuant to the procedures in 
subchapter V of chapter 35 of title 31 and an actual or prospective 
offeror so requests, a file of the protest shall be established by the 
procuring activity and reasonable access shall be provided to actual or 
prospective offerors.
    ``(2) Information exempt from disclosure under section 552 of title 
5 may be redacted in a file established pursuant to paragraph (1) 
unless an applicable protective order provides otherwise.
    ``(3) Regulations implementing this subsection shall be consistent 
with the regulations regarding the preparation and submission of an 
agency's protest file (the so-called `rule 4 file') for protests to the 
General Services Board of Contract Appeals under section 111 of the 
Federal Property and Administrative Services Act of 1949 (41 U.S.C. 
759).''.

SEC. 1016. AGENCY DECISIONS ON PROTESTS.

    Section 2305 of title 10, United States Code, as amended by section 
1015, is further amended by adding at the end the following new 
subsection:
    ``(f) Decisions on Protests.--If, in connection with a protest, the 
head of an agency determines that a solicitation, proposed award, or 
award does not comply with the requirements of law or regulation, the 
head of the agency--
            ``(1) may take any action set out in subparagraphs (A) 
        through (F) of subsection (b)(1) of section 3554 of title 31; 
        and
            ``(2) may pay costs described in paragraph (1) of section 
        3554(c) of title 31 within the limits referred to in paragraph 
        (2) of such section.''.

SEC. 1017. AWARD OF MULTIPLE CONTRACTS.

    Section 2305 of title 10, United States Code, as amended by section 
1016, is further amended by adding at the end the following new 
subsection:
    ``(g) Award of Multiple Contracts.--In procuring any supply or 
service using competitive procedures, the head of an agency may award 
more than one contract for the same supply or service in any case in 
which the head of the agency determines that it is in the best 
interests of the Federal Government to award those contracts for the 
purpose of maintaining a continuous source for the supply or 
service.''.

                     Subpart C--Kinds of Contracts

SEC. 1021. REPEAL OF REQUIREMENT FOR SECRETARIAL DETERMINATION 
              REGARDING USE OF COST TYPE OR INCENTIVE CONTRACT.

    Subsection (c) of section 2306 of title 10, United States Code, is 
repealed.

     Subpart D--Miscellaneous Provisions for the Encouragement of 
                              Competition

SEC. 1031. REPEAL OF REQUIREMENT FOR ANNUAL REPORT BY ADVOCATES FOR 
              COMPETITION.

    Subsection (c) of section 2318 of title 10, United States Code, is 
repealed.

                 PART II--CIVILIAN AGENCY ACQUISITIONS

                  Subpart A--Competition Requirements

SEC. 1051. REFERENCES TO FEDERAL ACQUISITION REGULATION.

    Section 303 of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 253) is amended--
            (1) in subsection (a)(1)(A), by striking out 
        ``modifications'' and all that follows through ``of 1984'' and 
        inserting in lieu thereof ``Federal Acquisition Regulation''; 
        and
            (2) in subsection (g)(1), by striking out ``regulations 
        modified'' and all that follows through ``of 1984,'' and 
        inserting in lieu thereof ``Federal Acquisition Regulation''.

SEC. 1052. ESTABLISHMENT OR MAINTENANCE OF ALTERNATIVE SOURCES OF 
              SUPPLY.

    (a) Prohibition on Use of Classes of Purchases or Contracts.--
Section 303(b) of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 253(b)) is amended--
            (1) by redesignating paragraphs (2) and (3) as paragraphs 
        (3) and (4), respectively;
            (2) by inserting after paragraph (1) the following new 
        paragraph (2):
    ``(2) A determination under paragraph (1) may not be made for a 
class of purchases or contracts.''; and
            (3) in paragraph (4), as redesignated by paragraph (1), by 
        striking out ``paragraphs (1) and (2)'' and inserting in lieu 
        thereof ``paragraphs (1) and (3)''.
    (b) Additional Justification for Establishing or Maintaining 
Alternative Sources.--Section 303(b)(1) of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 253(b)(1)) is amended--
            (1) by striking out ``or'' at the end of subparagraph (B);
            (2) by striking out the period at the end of subparagraph 
        (C) and inserting in lieu thereof a semicolon; and
            (3) by adding at the end the following new subparagraphs:
            ``(D) would ensure the continuous availability of a 
        reliable source of supply of such property or service;
            ``(E) would satisfy projected needs for such property or 
        service determined on the basis of a history of high demand for 
        the property or service; or
            ``(F) in the case of medical supplies, safety supplies, or 
        emergency supplies, would satisfy a critical need for such 
        supplies.''.

SEC. 1053. CLARIFICATION OF APPROVAL AUTHORITY FOR USE OF PROCEDURES 
              OTHER THAN FULL AND OPEN COMPETITION.

    Section 303(f)(1)(B)(i) of the Federal Property and Administrative 
Services Act of 1949 (41 U.S.C. 253(f)(1)(B)(i)) is amended by 
inserting before the semicolon at the end the following: ``or by an 
official referred to in clause (ii), (iii), or (iv)''.

        Subpart B--Planning, Solicitation, Evaluation, and Award

SEC. 1061. SOLICITATION, EVALUATION, AND AWARD.

    (a) Content of Solicitation.--Section 303A of the Federal Property 
and Administrative Services Act of 1949 (41 U.S.C. 253a) is amended--
            (1) in subsection (b)(1), by amending subparagraph (A) to 
        read as follows:
                    ``(A) all significant factors and significant 
                subfactors which the executive agency reasonably 
                expects to consider in evaluating sealed bids 
                (including price) or competitive proposals (including 
                cost or price, cost- or price-related factors and 
                subfactors, and noncost- or nonprice-related factors 
                and subfactors); and'';
            (2) in subsection (b)(1)(B), by inserting ``and 
        subfactors'' after ``factors'';
            (3) in subsection (b)(2)(B), by striking out clause (i) and 
        inserting in lieu thereof the following:
                    ``(i) either a statement that the proposals are 
                intended to be evaluated with, and award made after, 
                discussions with the offerors, or a statement that the 
                proposals are intended to be evaluated, and award made, 
                without discussions with the offerors (other than 
                discussions conducted for the purpose of minor 
                clarification) unless discussions are determined to be 
                necessary; and''; and
            (4) by adding at the end the following new subsection:
    ``(c)(1) In prescribing the evaluation factors to be included in 
each solicitation for competitive proposals, an executive agency--
            ``(A) shall clearly establish the relative importance 
        assigned to the evaluation factors and subfactors, including 
        the quality of the product or services to be provided 
        (including technical capability, management capability, prior 
        experience, and past performance of the offeror);
            ``(B) shall include cost or price to the Federal Government 
        as an evaluation factor that must be considered in the 
        evaluation of proposals; and
            ``(C) shall disclose to offerors whether all evaluation 
        factors other than cost or price, when combined, are--
                    ``(i) significantly more important than cost or 
                price;
                    ``(ii) approximately equal in importance to cost or 
                price; or
                    ``(iii) significantly less important than cost or 
                price.
    ``(2) The regulations implementing subparagraph (C) of paragraph 
(1) may not define the terms `significantly more important' and 
`significantly less important' as specific numeric weights that would 
be applied uniformly to all solicitations.
    ``(3) Nothing in this subsection prohibits an executive agency 
from--
            ``(A) providing additional information in a solicitation, 
        including numeric weights for all evaluation factors and 
        subfactors; or
            ``(B) stating in a solicitation that award will be made to 
        the offeror that meets the solicitation's mandatory 
        requirements at the lowest cost or price.''.
    (b) Evaluation and Award.--Section 303B of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 253b) is amended--
            (1) in subsection (a), by inserting ``, and award a 
        contract,'' after ``competitive proposals'';
            (2) in subsection (c), by inserting ``in accordance with 
        subsection (a)'' in the second sentence after ``shall evaluate 
        the bids''; and
            (3) in subsection (d)--
                    (A) by striking out paragraph (1) and inserting in 
                lieu thereof the following:
    ``(1) An executive agency shall evaluate competitive proposals in 
accordance with subsection (a) and may award a contract--
            ``(A) after discussions with the offerors, provided that 
        written or oral discussions have been conducted with all 
        responsible offerors who submit proposals within the 
        competitive range; or
            ``(B) based on the proposals received and without 
        discussions with the offerors (other than discussions conducted 
        for the purpose of minor clarification), provided that, as 
        required by section 303A(b)(2)(B)(i), the solicitation included 
        a statement that proposals are intended to be evaluated, and 
        award made, without discussions, unless discussions are 
        determined to be necessary.''; and
                    (B) by striking out paragraphs (2) and (3) and by 
                redesignating paragraph (4) as paragraph (2).
    (c) Authority To Apply Amendments Early.--The head of an executive 
agency may apply the amendments made by this section to solicitations 
issued before the effective date specified in section 9001(a) and to 
contracts awarded pursuant to those solicitations. The head of the 
executive agency shall publish in the Federal Register notice of any 
such earlier date of application at least 10 days before that date.

SEC. 1062. SOLICITATION PROVISION REGARDING EVALUATION OF PURCHASE 
              OPTIONS.

    Section 303A of the Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 253a), as amended by section 1061(a)(4), is 
further amended by adding at the end the following new subsection:
    ``(d) An executive agency, in issuing a solicitation for a contract 
to be awarded using sealed bid procedures, may not include in such 
solicitation a clause providing for the evaluation of prices under the 
contract for options to purchase additional supplies or services under 
the contract unless the executive agency has determined that there is a 
reasonable likelihood that the options will be exercised.''.

SEC. 1063. PROMPT NOTICE OF AWARD.

    (a) Sealed Bid Procedures.--Subsection (c) of section 303B of the 
Federal Property and Administrative Services Act of 1949 (41 U.S.C. 
253b) is amended--
            (1) in the last sentence, by striking out ``transmitting 
        written notice'' and inserting in lieu thereof ``transmitting, 
        in writing or by electronic means, notice''; and
            (2) by adding at the end the following: ``Within 3 days 
        after the date of contract award, the executive agency shall 
        notify, in writing or by electronic means, each bidder not 
        awarded the contract that the contract has been awarded.''.
    (b) Competitive Proposals Procedures.--Paragraph (2) of such 
section, as redesignated by section 1061(b)(3)(B), is amended in the 
second sentence--
            (1) by striking out ``transmitting written notice'' and 
        inserting in lieu thereof ``transmitting, in writing or by 
        electronic means, notice''; and
            (2) by striking out ``shall promptly notify'' and inserting 
        in lieu thereof ``, within 3 days after the date of contract 
        award, shall notify, in writing or by electronic means,''.

SEC. 1064. POST-AWARD DEBRIEFINGS.

    Section 303B of the Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 253b) is amended--
            (1) by redesignating subsections (e) and (f) as subsections 
        (f) and (g), respectively; and
            (2) by inserting after subsection (d) the following new 
        subsection (e):
    ``(e)(1) When a contract is awarded by an executive agency on the 
basis of competitive proposals, an unsuccessful offeror, upon written 
request received by the executive agency within 5 days after the date 
of receipt of notification of the contract award, shall be debriefed 
and furnished the basis for the selection decision and contract award. 
The executive agency shall debrief the offeror within, to the maximum 
extent practicable, 5 days after receipt of the request by the 
executive agency.
    ``(2) Such debriefing shall include, at a minimum, the following:
            ``(A) The executive agency's evaluation of the significant 
        weak or deficient factors in the offeror's offer.
            ``(B) The overall evaluated cost of the offer of the 
        offeror awarded the contract and the overall evaluated cost of 
        the offer of the debriefed offeror.
            ``(C) The overall ranking of all offers and the total 
        technical and cost scores of all offers.
            ``(D) A summary of the rationale for the award.
            ``(E) In the case of an offer by the debriefed offeror that 
        includes a commercial item that is an end item under the 
        contract, the makes and models of similar commercial items 
        included in the offer of the offeror awarded the contract.
            ``(F) Reasonable responses to questions posed by the 
        debriefed offeror as to whether source selection procedures set 
        forth in the solicitation, applicable regulations, and other 
        applicable authorities were followed by the executive agency.
    ``(3) The debriefing shall not include point-by-point comparisons 
of the debriefed offeror's offer with other offers and shall not 
disclose any information that is exempt from disclosure under section 
552 of title 5, United States Code.
    ``(4) Each solicitation for competitive proposals shall include a 
statement that information described in paragraph (2) may be disclosed 
in post-award debriefings.
    ``(5) The contracting officer shall include a summary of the 
debriefing in the contract file.''.

SEC. 1065. PROTEST FILE.

    Section 303B of the Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 253b) is amended by adding at the end the 
following new subsection:
    ``(h) Protest File.--(1) If, in the case of a solicitation for a 
contract issued by, or an award or proposed award of a contract by, an 
agency head, a protest is filed pursuant to the procedures in 
subchapter V of chapter 35 of title 31, United States Code, and an 
actual or prospective offeror so requests, a file of the protest shall 
be established by the procuring activity and reasonable access shall be 
provided to actual or prospective offerors.
    ``(2) Information exempt from disclosure under section 552 of title 
5, United States Code, may be redacted in a file established pursuant 
to paragraph (1) unless an applicable protective order provides 
otherwise.
    ``(3) Regulations implementing this subsection shall be consistent 
with the regulations regarding the preparation and submission of an 
agency's protest file (the so-called `rule 4 file') for protests to the 
General Services Board of Contract Appeals under section 111 of the 
Federal Property and Administrative Services Act of 1949 (41 U.S.C. 
759).''.

SEC. 1066. AGENCY DECISIONS ON PROTESTS.

    Section 303B of the Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 253b), as amended by section 1065, is further 
amended by adding at the end the following new subsection:
    ``(i) Decisions on Protests.--If, in connection with a protest, an 
executive agency determines that a solicitation, proposed award, or 
award does not comply with the requirements of law or regulation, the 
executive agency--
            ``(1) may take any action set out in subparagraphs (A) 
        through (F) of subsection (b)(1) of section 3554 of title 31, 
        United States Code; and
            ``(2) may pay costs described in paragraph (1) of section 
        3554(c) of such title within the limits referred to in 
        paragraph (2) of such section.''.

SEC. 1067. AWARD OF MULTIPLE CONTRACTS.

    Section 303B of the Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 253b), as amended by section 1066, is further 
amended by adding at the end the following new subsection:
    ``(j) Award of Multiple Contracts.--In procuring any supply or 
service using competitive procedures, an executive agency may award 
more than one contract for the same supply or service in any case in 
which the executive agency determines that it is in the best interests 
of the Federal Government to award those contracts for the purpose of 
maintaining a continuous source for the supply or service.''.

                     Subpart C--Kinds of Contracts

SEC. 1071. REPEAL OF AGENCY HEAD DETERMINATION REGARDING USE OF COST 
              TYPE OR INCENTIVE CONTRACT.

    Section 304(b) of the Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 254(b)) is amended by striking out the second 
sentence.

SEC. 1072. MULTIYEAR CONTRACTING AUTHORITY.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.) is amended by inserting after section 
304 the following new section:

``SEC. 304A. MULTIYEAR CONTRACTS.

    ``(a) Authority.--An executive agency may enter into a multiyear 
contract for the acquisition of property or services if--
            ``(1) funds are available and obligated for such contract, 
        for the full period of the contract or for the first fiscal 
        year in which the contract is in effect, and for the estimated 
        costs associated with any necessary termination of such 
        contract;
            ``(2) the executive agency determines that--
                    ``(A) the need for the property or services is 
                reasonably firm and continuing over the period of the 
                contract; and
                    ``(B) a multiyear contract will serve the best 
                interests of the United States by encouraging full and 
                open competition or promoting economy in 
                administration, performance, and operation of the 
                agency's programs; and
            ``(3) such contract is awarded on a fully competitive 
        basis.
    ``(b) Termination Clause.--A multiyear contract entered into under 
the authority of this section shall include a clause that provides that 
the contract shall be terminated if funds are not made available for 
the continuation of such contract in any fiscal year covered by the 
contract. Amounts available for paying termination costs shall remain 
available for such purpose until the costs associated with termination 
of the contract are paid.
    ``(c) Cancellation Ceiling Notice.--Before any contract described 
in subsection (a) that contains a clause setting forth a cancellation 
ceiling in excess of $10,000,000 may be awarded, the executive agency 
shall give written notification of the proposed contract and of the 
proposed cancellation ceiling for that contract to the Congress, and 
such contract may not then be awarded until the end of a period of 30 
days beginning on the date of such notification.
    ``(d) Multiyear Contract Defined.--For the purposes of this 
section, a multiyear contract is a contract for the purchase of 
property or services for more than one, but not more than five, program 
years. Such a contract may provide that performance under the contract 
during the second and subsequent years of the contract is contingent 
upon the appropriation of funds and (if it does so provide) may provide 
for a cancellation payment to be made to the contractor if such 
appropriations are not made.
    ``(e) Rule of Construction.--Nothing in this section is intended to 
modify or affect any other provision of law that authorizes multiyear 
contracts.''.

SEC. 1073. SEVERABLE SERVICES CONTRACTS CROSSING FISCAL YEARS.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.) is amended by inserting after section 
303G the following new section:

``SEC. 303H. SEVERABLE SERVICES CONTRACTS FOR PERIODS CROSSING FISCAL 
              YEARS.

    ``(a) Authority.--An executive agency may enter into a severable 
contract for procurement of services for a period that begins in one 
fiscal year and ends in the next fiscal year if (without regard to any 
option to extend the period of the contract) the contract period does 
not exceed one year.
    ``(b) Availability of Funds.--To the extent provided in 
appropriations Acts, funds obligated for a contract entered into under 
the authority of subsection (a) shall remain available until no longer 
needed to pay for such contract.
    ``(c) Severable Contract Defined.--In this section, the term 
`severable contract' means a contract that contains a clause that makes 
the effectiveness of the contract for periods after the end of the 
fiscal year in which the performance of the contract begins subject to 
the availability of appropriations.''.

                    PART III--ACQUISITIONS GENERALLY

SEC. 1091. POLICY REGARDING CONSIDERATION OF CONTRACTOR PAST 
              PERFORMANCE.

    (a) Policy.--Section 2 of the Office of Federal Procurement Policy 
Act (41 U.S.C. 401) is amended--
            (1) by striking out ``and'' at the end of paragraph (12);
            (2) by striking out the period at the end of paragraph (13) 
        and inserting in lieu thereof ``; and''; and
            (3) by adding at the end the following new paragraph:
            ``(14) establishing policies and procedures that encourage 
        the consideration of contractors' past performance in the 
        selection of contractors.''.
    (b) Guidance Required.--Section 6 of the Office of Federal 
Procurement Policy Act (41 U.S.C. 405) is amended by adding at the end 
the following:
    ``(j)(1) Congress makes the following findings:
            ``(A) Past contract performance of an offeror is one of the 
        relevant factors that a contracting official of an executive 
        agency should consider in awarding a contract.
            ``(B) It is appropriate for a contracting official to 
        consider past contract performance of an offeror as an 
        indicator of the likelihood that the offeror will successfully 
        perform a contract to be awarded by that official.
    ``(2) The Administrator shall prescribe for executive agencies 
guidance regarding consideration of the past contract performance of 
offerors in awarding contracts. The guidance shall include--
            ``(A) standards for evaluating past performance with 
        respect to cost (when appropriate), schedule, compliance with 
        technical or functional specifications, and other relevant 
        performance factors that facilitate consistent and fair 
        evaluation by all executive agencies;
            ``(B) policies for the collection and maintenance of 
        information on past contract performance that, to the maximum 
        extent practicable, facilitate automated collection, 
        maintenance, and dissemination of information and provide for 
        ease of collection, maintenance, and dissemination of 
        information by other methods, as necessary; and
            ``(C) policies for ensuring that offerors are afforded an 
        opportunity to submit information on past contract performance 
        and that such information submitted by offerors is considered.
    ``(3) The Administrator shall prescribe for all executive agencies 
the policy regarding the period for which information on past 
performance of offerors may be maintained and considered.
    ``(4) In the case of an offeror with respect to which there is no 
information on past contract performance or with respect to which 
information on past contract performance is not available, the offeror 
may not be evaluated favorably or unfavorably on the factor of past 
contract performance.''.

SEC. 1092. REPEAL OF REQUIREMENT FOR ANNUAL REPORT ON COMPETITION.

    Section 23 of the Office of Federal Procurement Policy Act (41 
U.S.C. 419) is repealed.

SEC. 1093. DISCOURAGEMENT OF NONSTANDARD CONTRACT CLAUSES.

    The Office of Federal Procurement Policy Act (41 U.S.C. 401 et 
seq.) is amended by adding at the end the following new section:

``SEC. 29. NONSTANDARD CONTRACT CLAUSES.

    ``The Federal Acquisition Regulatory Council shall promulgate 
regulations to discourage the use of a nonstandard contract clause on a 
repetitive basis. The regulations shall include provisions that--
            ``(1) clearly define nonstandard clauses; and
            ``(2) require prior approval for the use of a nonstandard 
        clause on a repetitive basis by an official at a level of 
        responsibility above the contracting officer.''.

                   Subtitle B--Truth in Negotiations

                  PART I--ARMED SERVICES ACQUISITIONS

SEC. 1201. STABILIZATION OF DOLLAR THRESHOLD OF APPLICABILITY.

    (a) Dollar Threshold Stabilization for Offerors for Prime 
Contracts.--Paragraph (1)(A) of section 2306a(a) of title 10, United 
States Code, is amended--
            (1) in clause (i), by striking out ``and before January 1, 
        1996,''; and
            (2) in clause (ii), by striking out ``or after December 31, 
        1995,''.
    (b) Adjustment of Dollar Threshold.--Such section is further 
amended by adding at the end the following new paragraph:
    ``(7) The dollar amount in each of subparagraphs (A), (B), (C), and 
(D) of paragraph (1) shall be adjusted on October 1 of each year 
divisible by 5 to the equivalent amount in constant fiscal year 1993 
dollars (rounded to the nearest $10,000).''.

SEC. 1202. EXCEPTIONS TO COST OR PRICING DATA REQUIREMENTS.

    (a) Exceptions.--Subsection (b) of section 2306a of title 10, 
United States Code, is amended to read as follows:
    ``(b) Exceptions.--(1) This section shall not be applied to a 
contract or subcontract, or a modification to a contract or 
subcontract--
            ``(A) for which the price agreed upon is based on--
                    ``(i) adequate price competition;
                    ``(ii) established catalog or market prices of 
                commercial items or of services regularly used for 
                other than Federal Government purposes, as the case may 
                be, that are sold in sufficient quantities to the 
                general public; or
                    ``(iii) prices set by law or regulation; or
            ``(B) in an exceptional case when the head of the procuring 
        activity, without delegation, determines that the requirements 
        of this section may be waived and justifies in writing the 
        reasons for such determination.
    ``(2) The Federal Acquisition Regulation (issued under section 
25(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 
421(c)) shall provide clear standards for determining whether the 
exceptions provided in paragraph (1)(A) apply. In the case of the 
exception provided in paragraph (1)(A)(i), the regulations shall 
specify the criteria to be used to determine whether adequate price 
competition exists. In the case of the exception provided in paragraph 
(1)(A)(ii), the regulations shall preclude the consideration of sales 
to the Federal Government, including the percentage of an item's 
overall sales that are made to the Federal Government, when determining 
whether the item has been sold in sufficient quantities to the 
public.''.
    (b) Limitation on Authority.--Subsection (c) of such section is 
amended to read as follows:
    ``(c) Authority To Require Cost or Pricing Data on Below-Threshold 
Contracts.--When cost or pricing data are not required to be submitted 
by subsection (a), such data may nevertheless be required to be 
submitted by the head of the procuring activity, but only if the head 
of the procuring activity determines that such data are necessary for 
the evaluation by the agency of the reasonableness of the price of the 
contract or subcontract. In any case in which the head of the procuring 
activity requires such data to be submitted under this subsection, the 
head of the procuring activity shall justify in writing the reason for 
such requirement. The head of the procuring activity may not require 
such data to be submitted under this subsection for any contract or 
subcontract, or modification to a contract or subcontract, covered by 
the exceptions in subsection (b). The head of the procuring activity 
may not delegate the functions under this subsection.''.

SEC. 1203. RIGHT OF UNITED STATES TO EXAMINE CONTRACTOR RECORDS.

    Subsection (f) of section 2306a of title 10, United States Code, is 
amended to read as follows:
    ``(f) Right of United States To Examine Contractor Records.--For 
the purpose of evaluating the accuracy, completeness, and currency of 
cost or pricing data required to be submitted by this section, the head 
of an agency shall have the authority provided by section 2313(a)(2) of 
this title.''.

SEC. 1204. CONSISTENCY OF TIME REFERENCES.

    Section 2306a of title 10, United States Code, is amended--
            (1) in subparagraphs (A)(ii) and (B)(ii) of subsection 
        (d)(4), by inserting ``or, if applicable consistent with 
        paragraph (1)(B), another date agreed upon between the 
        parties'' after ``(or price of the modification)''; and
            (2) in subsection (g), by inserting ``or, if applicable 
        consistent with subsection (d)(1)(B), another date agreed upon 
        between the parties'' after ``(or the price of a contract 
        modification)''.

SEC. 1205. REPEAL OF SUPERSEDED PROVISION.

    Subsection (c) of section 803 of Public Law 101-510 (10 U.S.C. 
2306a note) is repealed.

                 PART II--CIVILIAN AGENCY ACQUISITIONS

SEC. 1251. REVISION OF CIVILIAN AGENCY PROVISIONS TO ENSURE UNIFORM 
              TREATMENT OF COST OR PRICING DATA.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.) is amended--
            (1) in section 304, by striking out subsection (d); and
            (2) by inserting after section 304A, as added by section 
        1072, the following new section:

``SEC. 304B. COST OR PRICING DATA: TRUTH IN NEGOTIATIONS.

    ``(a) Required Cost or Pricing Data and Certification.--(1) An 
executive agency shall require offerors, contractors, and 
subcontractors to make cost or pricing data available as follows:
            ``(A) An offeror for a prime contract under this title to 
        be entered into using procedures other than sealed-bid 
        procedures shall be required to submit cost or pricing data 
        before the award of a contract if--
                    ``(i) in the case of a prime contract entered into 
                after the date of the enactment of the Federal 
                Acquisition Improvement Act of 1994, the price of the 
                contract to the United States is expected to exceed 
                $500,000; and
                    ``(ii) in the case of a prime contract entered into 
                on or before the date of the enactment of the Federal 
                Acquisition Improvement Act of 1994, the price of the 
                contract to the United States is expected to exceed 
                $100,000.
            ``(B) The contractor for a prime contract under this 
        chapter shall be required to submit cost or pricing data before 
        the pricing of a change or modification to the contract if--
                    ``(i) in the case of a change or modification made 
                to a prime contract referred to in subparagraph (A)(i), 
                the price adjustment is expected to exceed $500,000;
                    ``(ii) in the case of a change or modification made 
                to a prime contract that was entered into on or before 
                the date of the enactment of the Federal Acquisition 
                Improvement Act of 1994, and that has been modified 
                pursuant to paragraph (6), the price adjustment is 
                expected to exceed $500,000; and
                    ``(iii) in the case of a change or modification not 
                covered by clause (i) or (ii), the price adjustment is 
                expected to exceed $100,000.
            ``(C) An offeror for a subcontract (at any tier) of a 
        contract under this title shall be required to submit cost or 
        pricing data before the award of the subcontract if the prime 
        contractor and each higher-tier subcontractor have been 
        required to make available cost or pricing data under this 
        section and--
                    ``(i) in the case of a subcontract under a prime 
                contract referred to in subparagraph (A)(i), the price 
                of the subcontract is expected to exceed $500,000;
                    ``(ii) in the case of a subcontract entered into 
                under a prime contract that was entered into on or 
                before the date of the enactment of the Federal 
                Acquisition Improvement Act of 1994, and that has been 
                modified pursuant to paragraph (6), the price of the 
                subcontract is expected to exceed $500,000; and
                    ``(iii) in the case of a subcontract not covered by 
                clause (i) or (ii), the price of the subcontract is 
                expected to exceed $100,000.
            ``(D) The subcontractor for a subcontract covered by 
        subparagraph (C) shall be required to submit cost or pricing 
        data before the pricing of a change or modification to the 
        subcontract if--
                    ``(i) in the case of a change or modification to a 
                subcontract referred to in subparagraph (C)(i) or 
                (C)(ii), the price adjustment is expected to exceed 
                $500,000; and
                    ``(ii) in the case of a change or modification to a 
                subcontract referred to in subparagraph (C)(iii), the 
                price adjustment is expected to exceed $100,000.
    ``(2) A person required, as an offeror, contractor, or 
subcontractor, to submit cost or pricing data under paragraph (1) (or 
required by the head of the procuring activity concerned to submit such 
data under subsection (c)) shall be required to certify that, to the 
best of the person's knowledge and belief, the cost or pricing data 
submitted are accurate, complete, and current.
    ``(3) Cost or pricing data required to be submitted under paragraph 
(1) (or under subsection (c)), and a certification required to be 
submitted under paragraph (2), shall be submitted--
            ``(A) in the case of a submission by a prime contractor (or 
        an offeror for a prime contract), to the contracting officer 
        for the contract (or to a designated representative of the 
        contracting officer); or
            ``(B) in the case of a submission by a subcontractor (or an 
        offeror for a subcontract), to the prime contractor.
    ``(4) Except as provided under subsection (b), this section applies 
to contracts entered into by an agency head on behalf of a foreign 
government.
    ``(5) For purposes of paragraph (1)(C), a contractor or 
subcontractor granted a waiver under subsection (b)(2) shall be 
considered as having been required to make available cost or pricing 
data under this section.
    ``(6) Upon the request of a contractor that was required to submit 
cost or pricing data under paragraph (1) in connection with a prime 
contract entered into on or before the date of the enactment of the 
Federal Acquisition Improvement Act of 1994, the agency head that 
entered into such contract shall modify the contract to reflect 
subparagraphs (B)(ii) and (C)(ii) of paragraph (1). All such 
modifications shall be made without requiring consideration.
    ``(7) The dollar amount in each of subparagraphs (A), (B), (C), and 
(D) of paragraph (1) shall be adjusted on October 1 of each year 
divisible by 5 to the equivalent amount in constant fiscal year 1993 
dollars (rounded to the nearest $10,000).
    ``(b) Exceptions.--(1) This section shall not be applied to a 
contract or subcontract, or a modification to a contract or 
subcontract--
            ``(A) for which the price agreed upon is based on--
                    ``(i) adequate price competition;
                    ``(ii) established catalog or market prices of 
                commercial items or of services regularly used for 
                other than Federal Government purposes, as the case may 
                be, that are sold in sufficient quantities to the 
                general public; or
                    ``(iii) prices set by law or regulation; or
            ``(B) in an exceptional case when the head of the procuring 
        activity, without delegation, determines that the requirements 
        of this section may be waived and justifies in writing the 
        reasons for such determination.
    ``(2) The Federal Acquisition Regulation (issued under section 
25(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 
421(c)) shall provide clear standards for determining whether the 
exceptions provided in paragraph (1)(A) apply. In the case of the 
exception provided in paragraph (1)(A)(i), the regulations shall 
specify the criteria to be used to determine whether adequate price 
competition exists. In the case of the exception provided in paragraph 
(1)(A)(ii), the regulations shall preclude the consideration of sales 
to the Federal Government, including the percentage of an item's 
overall sales that are made to the Federal Government, when determining 
whether the item has been sold in sufficient quantities to the public.
    ``(c) Authority To Require Cost or Pricing Data on Below-Threshold 
Contracts.--When cost or pricing data are not required to be submitted 
by subsection (a), such data may nevertheless be required to be 
submitted by the head of the procuring activity, but only if the head 
of the procuring activity determines that such data are necessary for 
the evaluation by the agency of the reasonableness of the price of the 
contract or subcontract. In any case in which the head of the procuring 
activity requires such data to be submitted under this subsection, the 
head of the procuring activity shall justify in writing the reason for 
such requirement. The head of the procuring activity may not require 
such data to be submitted under this subsection for any contract or 
subcontract, or modification to a contract or subcontract, covered by 
the exceptions in subsection (b). The head of the procuring activity 
may not delegate the functions under this subsection.
    ``(d) Price Reductions for Defective Cost or Pricing Data.--(1)(A) 
A prime contract (or change or modification to a prime contract) under 
which a certificate under subsection (a)(2) is required shall contain a 
provision that the price of the contract to the United States, 
including profit or fee, shall be adjusted to exclude any significant 
amount by which it may be determined by the agency head that such price 
was increased because the contractor (or any subcontractor required to 
make available such a certificate) submitted defective cost or pricing 
data.
    ``(B) For the purposes of this section, defective cost or pricing 
data are cost or pricing data which, as of the date of agreement on the 
price of the contract (or another date agreed upon between the 
parties), were inaccurate, incomplete, or noncurrent. If for purposes 
of the preceding sentence the parties agree upon a date other than the 
date of agreement on the price of the contract, the date agreed upon by 
the parties shall be as close to the date of agreement on the price of 
the contract as is practicable.
    ``(2) In determining for purposes of a contract price adjustment 
under a contract provision required by paragraph (1) whether, and to 
what extent, a contract price was increased because the contractor (or 
a subcontractor) submitted defective cost or pricing data, it shall be 
a defense that the United States did not rely on the defective data 
submitted by the contractor or subcontractor.
    ``(3) It is not a defense to an adjustment of the price of a 
contract under a contract provision required by paragraph (1) that--
            ``(A) the price of the contract would not have been 
        modified even if accurate, complete, and current cost or 
        pricing data had been submitted by the contractor or 
        subcontractor because the contractor or subcontractor--
                    ``(i) was the sole source of the property or 
                services procured; or
                    ``(ii) otherwise was in a superior bargaining 
                position with respect to the property or services 
                procured;
            ``(B) the contracting officer should have known that the 
        cost and pricing data in issue were defective even though the 
        contractor or subcontractor took no affirmative action to bring 
        the character of the data to the attention of the contracting 
        officer;
            ``(C) the contract was based on an agreement between the 
        contractor and the United States about the total cost of the 
        contract and there was no agreement about the cost of each item 
        procured under such contract; or
            ``(D) the prime contractor or subcontractor did not submit 
        a certification of cost and pricing data relating to the 
        contract as required under subsection (a)(2).
    ``(4)(A) A contractor shall be allowed to offset an amount against 
the amount of a contract price adjustment under a contract provision 
required by paragraph (1) if--
            ``(i) the contractor certifies to the contracting officer 
        (or to a designated representative of the contracting officer) 
        that, to the best of the contractor's knowledge and belief, the 
        contractor is entitled to the offset; and
            ``(ii) the contractor proves that the cost or pricing data 
        were available before the date of agreement on the price of the 
        contract (or price of the modification), or, if applicable 
        consistent with paragraph (1)(B), another date agreed upon 
        between the parties, and that the data were not submitted as 
        specified in subsection (a)(3) before such date.
    ``(B) A contractor shall not be allowed to offset an amount 
otherwise authorized to be offset under subparagraph (A) if--
            ``(i) the certification under subsection (a)(2) with 
        respect to the cost or pricing data involved was known to be 
        false when signed; or
            ``(ii) the United States proves that, had the cost or 
        pricing data referred to in subparagraph (A)(ii) been submitted 
        to the United States before the date of agreement on the price 
        of the contract (or price of the modification) or, if 
        applicable under paragraph (1)(B), another date agreed upon 
        between the parties, the submission of such cost or pricing 
        data would not have resulted in an increase in that price in 
        the amount to be offset.
    ``(e) Interest and Penalties for Certain Overpayments.--(1) If the 
United States makes an overpayment to a contractor under a contract 
with an executive agency subject to this section and the overpayment 
was due to the submission by the contractor of defective cost or 
pricing data, the contractor shall be liable to the United States--
            ``(A) for interest on the amount of such overpayment, to be 
        computed--
                    ``(i) for the period beginning on the date the 
                overpayment was made to the contractor and ending on 
                the date the contractor repays the amount of such 
                overpayment to the United States; and
                    ``(ii) at the current rate prescribed by the 
                Secretary of the Treasury under section 6621 of the 
                Internal Revenue Code of 1986; and
            ``(B) if the submission of such defective data was a 
        knowing submission, for an additional amount equal to the 
        amount of the overpayment.
    ``(2) Any liability under this subsection of a contractor that 
submits cost or pricing data but refuses to submit the certification 
required by subsection (a)(2) with respect to the cost or pricing data 
shall not be affected by the refusal to submit such certification.
    ``(f) Right of United States To Examine Contractor Records.--For 
the purpose of evaluating the accuracy, completeness, and currency of 
cost or pricing data required to be submitted by this section, an 
executive agency shall have the authority provided by section 
304C(a)(2).
    ``(g) Cost or Pricing Data Defined.--In this section, the term 
`cost or pricing data' means all facts that, as of the date of 
agreement on the price of a contract (or the price of a contract 
modification) or, if applicable consistent with subsection (d)(1)(B), 
another date agreed upon between the parties, a prudent buyer or seller 
would reasonably expect to affect price negotiations significantly. 
Such term does not include information that is judgmental, but does 
include the factual information from which a judgment was derived.''.

SEC. 1252. REPEAL OF OBSOLETE PROVISION.

    Section 303E of the Federal Property and Administrative Services 
Act of 1949 (41 U.S.C. 253e) is repealed.

                  Subtitle C--Research and Development

SEC. 1301. COMPETITION REQUIREMENT FOR AWARDS OF GRANTS AND CONTRACTS 
              TO NONPROFIT ORGANIZATIONS.

    Subsections (a) and (b) of section 2361 of title 10, United States 
Code, are amended by inserting ``or nonprofit organization other than a 
federally funded research and development center (FFRDC)'' after 
``college or university'' each place it appears.

                    Subtitle D--Procurement Protests

              PART I--PROTESTS TO THE COMPTROLLER GENERAL

SEC. 1401. PROTEST DEFINED.

    (a) In General.--Paragraph (1) of section 3551 of title 31, United 
States Code, is amended to read as follows:
            ``(1) The term `protest' means a written objection by an 
        interested party to any of the following:
                    ``(A) A solicitation or other request by a Federal 
                agency for offers for a contract for the procurement of 
                property or services.
                    ``(B) The cancellation of such a solicitation or 
                other request.
                    ``(C) An award or proposed award of such a 
                contract.
                    ``(D) A termination or cancellation of an award of 
                such a contract, if the written objection contains an 
                allegation that the termination or cancellation is 
                based in whole or in part on improprieties concerning 
                the award of the contract.''.
    (b) Technical Amendments.--Section 3551 of such title is further 
amended--
            (1) in paragraph (2)--
                    (A) by inserting ``The term'' after ``(2)''; and
                    (B) by striking out ``; and'' and inserting in lieu 
                thereof a period; and
            (2) in paragraph (3), by inserting ``The term'' after 
        ``(3)''.

SEC. 1402. REVIEW OF PROTESTS AND EFFECT ON CONTRACTS PENDING DECISION.

    (a) Periods for Certain Actions.--Section 3553 of title 31, United 
States Code, is amended--
            (1) in subsection (b)--
                    (A) in paragraph (1), by striking out ``one working 
                day of'' and inserting in lieu thereof ``one day 
                after''; and
                    (B) in paragraph (2)--
                            (i) in subparagraph (A), by striking out 
                        ``25 working days from'' and inserting in lieu 
                        thereof ``35 days after''; and
                            (ii) in subparagraph (C), by striking out 
                        ``10 working days from'' and inserting in lieu 
                        thereof ``15 days after''; and
            (2) in subsection (c)(3), by striking out ``thereafter'' 
        and inserting in lieu thereof ``after the making of such 
        finding''.
    (b) Suspension of Performance.--Subsection (d) of such section is 
amended to read as follows:
    ``(d)(1) A contractor awarded a Federal agency contract may, during 
the period described in paragraph (4), begin performance of the 
contract and engage in any related activities that result in 
obligations being incurred by the United States under the contract 
unless the contracting officer responsible for the award of the 
contract withholds authorization to proceed with performance of the 
contract.
    ``(2) The contracting officer may withhold an authorization to 
proceed with performance of the contract during the period described in 
paragraph (4) if the contracting officer determines in writing that--
            ``(A) a protest is likely to be filed; and
            ``(B) the immediate performance of the contract is not in 
        the best interests of the United States.
    ``(3)(A) If the Federal agency awarding the contract receives 
notice of a protest in accordance with this section during the period 
described in paragraph (4)--
            ``(i) the contracting officer may not authorize performance 
        of the contract to begin while the protest is pending; or
            ``(ii) if contract performance was authorized in accordance 
        with paragraph (2) before receipt of the notice, the 
        contracting officer shall immediately direct the contractor to 
        cease performance under the contract and to suspend any related 
        activities that may result in additional obligations being 
        incurred by the United States under that contract.
    ``(B) Performance and related activities suspended pursuant to 
subparagraph (A)(ii) by reason of a protest may not be resumed while 
the protest is pending.
    ``(C) The head of the procuring activity may authorize the 
performance of the contract (notwithstanding a protest of which the 
Federal agency has notice under this section)--
            ``(i) upon a written finding that--
                    ``(I) performance of the contract is in the best 
                interests of the United States; or
                    ``(II) urgent and compelling circumstances that 
                significantly affect interests of the United States 
                will not permit waiting for the decision of the 
                Comptroller General concerning the protest; and
            ``(ii) after the Comptroller General is notified of that 
        finding.
    ``(4) The period referred to in paragraphs (2) and (3)(A), with 
respect to a contract, is the period beginning on the date of the 
contract award and ending on the later of--
            ``(A) the date that is 10 days after the date of the 
        contract award; or
            ``(B) the date that is 5 days after the debriefing date 
        offered to an unsuccessful offeror for any debriefing that is 
        requested and, when requested, is required.''.

SEC. 1403. DECISIONS ON PROTESTS.

    (a) Periods for Certain Actions.--Section 3554(a) of title 31, 
United States Code, is amended--
            (1) in paragraph (1), by striking out ``90 working days 
        from'' and inserting in lieu thereof ``120 days after'';
            (2) in paragraph (2), by striking out ``45 calendar days 
        from'' and inserting ``60 days after'';
            (3) by redesignating paragraph (3) as paragraph (4); and
            (4) by inserting after paragraph (2) the following new 
        paragraph (3):
    ``(3) An amendment to a protest that adds a new ground of protest, 
if timely raised, should be resolved, to the maximum extent 
practicable, within the time limit established under paragraph (1) of 
this subsection for final decision of the initial protest. If an 
amended protest cannot be resolved within such time limit, the 
Comptroller General may resolve the amended protest through the express 
option under paragraph (2) of this subsection.''.
    (b) GAO Recommendations on Protests.--
            (1) Implementation of recommendations.--Section 3554 of 
        title 31, United States Code, is further amended in subsection 
        (b) by adding at the end the following new paragraph:
    ``(3) If the Federal agency fails to implement fully the 
recommendations of the Comptroller General under this subsection with 
respect to a solicitation for a contract or an award or proposed award 
of a contract within 60 days after receiving the recommendations, the 
head of the procuring activity responsible for that contract shall 
report such failure to the Comptroller General not later than 5 days 
after the end of such 60-day period.''.
            (2) Federal agency payment of costs.--Subsection (c) of 
        such section is amended to read as follows:
    ``(c)(1) If the Comptroller General determines that a solicitation 
for a contract or a proposed award or the award of a contract does not 
comply with a statute or regulation, the Comptroller General may 
recommend that the Federal agency conducting the procurement pay to an 
appropriate interested party the costs of--
            ``(A) filing and pursuing the protest, including reasonable 
        attorney's fees and consultant and expert witness fees; and
            ``(B) bid and proposal preparation.
    ``(2) If the Comptroller General recommends under paragraph (1) 
that a Federal agency pay costs to an interested party, the Federal 
agency shall--
            ``(A) pay the costs promptly out of funds available to or 
        for the use of the Federal agency; or
            ``(B) if the Federal agency does not make such payment, 
        promptly report to the Comptroller General the reasons for the 
        failure to follow the Comptroller General's recommendation.
    ``(3) If the Comptroller General recommends under paragraph (1) 
that a Federal agency pay costs to an interested party, the Federal 
agency and the interested party shall attempt to reach an agreement on 
the amount of the costs to be paid. If the Federal agency and the 
interested party are unable to agree on the amount to be paid, the 
Comptroller General may, upon the request of the interested party, 
recommend to the Federal agency the amount of the costs that the 
Federal agency should pay.''.
            (3) Report.--Subsection (e) of such section is amended to 
        read as follows:
    ``(e)(1) In any case in which a Federal agency fails to implement 
fully a recommendation of the Comptroller General under subsection (b) 
or (c), the Comptroller General shall promptly submit a report on the 
matter to the Committee on Governmental Affairs and the Committee on 
Appropriations of the Senate and to the Committee on Government 
Operations and the Committee on Appropriations of the House of 
Representatives. The report shall include--
            ``(A) a comprehensive review of the pertinent procurement, 
        including the circumstances of the failure of the Federal 
        agency to implement a recommendation of the Comptroller 
        General; and
            ``(B) a recommendation regarding whether, in order to 
        correct an inequity or to preserve the integrity of the 
        procurement process, the Congress should consider--
                    ``(i) private relief legislation;
                    ``(ii) legislative rescission or cancellation of 
                funds;
                    ``(iii) further investigation by the Congress; or
                    ``(iv) other action.
    ``(2) Not later than January 31 of each year, the Comptroller 
General shall transmit to the Congress a report containing a summary of 
each instance in which a Federal agency did not fully implement a 
recommendation of the Comptroller General under subsection (b) or (c) 
during the preceding year. The report shall also describe each instance 
in which a final decision in a protest was not rendered within 120 days 
after the date the protest is submitted to the Comptroller General.''.
            (4) Requirement for payment in accordance with prior gao 
        determinations.--Amounts to which the Comptroller General 
        declared an interested party to be entitled under section 3554 
        of title 31, United States Code, as in effect immediately 
        before the date of the enactment of this Act, shall, if not 
        paid or otherwise satisfied by the Federal agency concerned 
        before such date, be paid promptly out of funds available to or 
        for the use of the Federal agency.
    (c) Recovery of Costs for Frivolous Protests.--Section 3554 of 
title 31, United States Code, is further amended by adding at the end 
the following new subsection:
    ``(f) If the Comptroller General expressly finds that a protest or 
a portion of a protest is frivolous or has not been brought or pursued 
in good faith, the Comptroller may recommend that the protester or 
other interested party who joins the protest be liable to the United 
States for payment of all or that portion of the United States costs, 
for which such a finding is made, of reviewing the protest, including 
the fees and other expenses (as defined in section 2412(d)(2)(A) of 
title 28) incurred by the United States in defending the protest. The 
Federal Acquisition Regulation shall provide guidance under which the 
head of an agency may initiate action to obtain such costs, unless (A) 
special circumstances would make such payment unjust, or (B) the 
protester obtains documents or other information for the first time, 
after the protest is filed with the Comptroller General, which 
establishes that the protest or a portion is frivolous or has not been 
brought in good faith and the protester then promptly withdraws the 
protest or portion of the protest.''.
    (d) Restriction on Access to Certain Information.--Section 3553(f) 
of title 31, United States Code, is amended--
            (1) by inserting ``(1)'' after ``(f)''; and
            (2) by adding at the end the following:
    ``(2)(A) The Comptroller General may issue protective orders which 
establish terms, conditions, and restrictions for the provision of any 
document to a person under paragraph (1), that prohibit or restrict the 
disclosure by the person of information described in subparagraph (C) 
that is contained in such a document.
    ``(B) The penalties specified under section 27(i) of the Office of 
Federal Procurement Policy Act shall apply to the disclosure of 
information described in subparagraph (C) in violation of a term, 
condition, or restriction in a protective order under this paragraph by 
a person that is subject to the protective order.
    ``(C) Information referred to in subparagraphs (A) and (B) is 
procurement sensitive information, trade secrets, or other proprietary 
or confidential research, development, or commercial information.
    ``(D) A protective order under this paragraph shall not be 
considered to authorize the withholding of any document or information 
from the Congress or an executive agency.''.

SEC. 1404. REGULATIONS.

    (a) Computation of Periods.--Section 3555 of title 31, United 
States Code, is amended--
            (1) by redesignating subsection (b) as subsection (d); and
            (2) by inserting after subsection (a) the following new 
        subsection (b):
    ``(b) The procedures shall provide that, in the computation of any 
period described in this subchapter--
            ``(1) the day of the act, event, or default from which the 
        designated period of time begins to run not be included; and
            ``(2) the last day after such act, event, or default be 
        included, unless--
                    ``(A) such last day is a Saturday, a Sunday, or a 
                legal holiday; or
                    ``(B) in the case of a filing of a paper at the 
                General Accounting Office or a Federal agency, such 
                last day is a day on which weather or other conditions 
                cause the closing of the General Accounting Office or 
                Federal agency, in which event the next day that is not 
                a Saturday, Sunday, or legal holiday shall be 
                included.''.
    (b) Electronic Filings and Disseminations.--Such section, as 
amended by subsection (a), is further amended by inserting after 
subsection (b) the following new subsection:
    ``(c) The Comptroller General may prescribe procedures for the 
electronic filing and dissemination of documents and information 
required under this subchapter. In prescribing such procedures, the 
Comptroller General shall consider the ability of all parties to 
achieve electronic access to such documents and records.''.
    (c) Repeal of Obsolete Deadline.--Subsection (a) of such section is 
amended by striking out ``Not later than January 15, 1985, the'' and 
inserting in lieu thereof ``The''.

     PART II--PROTESTS IN PROCUREMENTS OF AUTOMATIC DATA PROCESSING

SEC. 1431. REVOCATION OF DELEGATIONS OF PROCUREMENT AUTHORITY.

    Section 111(b)(3) of the Federal Property and Administrative 
Services Act of 1949 (40 U.S.C. 759(b)(3)) is amended by inserting 
before the period at the end of the third sentence the following: ``, 
including the authority to revoke a delegation of authority with 
respect to a particular contract after award of the contract, except 
that the Administrator may revoke a delegation after the contract is 
awarded only when there is a finding of a violation of law or 
regulation in connection with the contract award.''.

SEC. 1432. AUTHORITY OF THE GENERAL SERVICES ADMINISTRATION BOARD OF 
              CONTRACT APPEALS.

    The first sentence of section 111(f)(1) of the Federal Property and 
Administrative Services Act of 1949 (40 U.S.C. 759(f)(1)) is amended to 
read as follows: ``Upon request of an interested party in connection 
with any procurement that is subject to this section (including any 
such procurement that is subject to delegation of procurement 
authority), the board of contract appeals of the General Services 
Administration (hereafter in this subsection referred to as the 
`board') shall review, as provided in this subsection, any decision by 
a contracting officer that is alleged to violate a statute, a 
regulation, or the conditions of a delegation of procurement 
authority.''.

SEC. 1433. PERIODS FOR CERTAIN ACTIONS.

    (a) Suspension of Procurement Authority.--(1) Section 111(f)(2)(B) 
of the Federal Property and Administrative Services Act of 1949 (40 
U.S.C. 759(f)(2)(B)) is amended--
            (A) by redesignating clauses (i) and (ii) as subclauses (I) 
        and (II), respectively;
            (B) by inserting ``(i)'' after ``(B)''; and
            (C) by adding at the end the following:
    ``(ii) A suspension under this subparagraph shall not preclude the 
Federal agency concerned from continuing the procurement process up to 
but not including award of the contract if the Board determines such 
action is in the best interests of the United States.''.
    (2) Section 111(f) of such Act (40 U.S.C. 759(f)) is amended in 
paragraph (3) by striking out subparagraph (A) and inserting in lieu 
thereof the following:
    ``(A)(i) If, with respect to an award of a contract, the board 
receives notice of a protest under this subsection within the period 
described in clause (ii), the board shall, at the request of an 
interested party, hold a hearing to determine whether the board should 
suspend the procurement authority of the Administrator or the 
Administrator's delegation of procurement authority for the protested 
procurement on an interim basis until the board can decide the protest.
    ``(ii) The period referred to in clause (i) is the period beginning 
on the date on which the contract is awarded and ending at the end of 
the later of--
            ``(I) the tenth day after the date of contract award; or
            ``(II) the fifth day after the debriefing date offered to 
        an unsuccessful offeror for any debriefing that is requested 
        and, when requested, is required.
    ``(iii) The board shall hold the requested hearing within 5 days 
after the date of the filing of the protest.''.
    (b) Final Decision.--Paragraph (4)(B) of such section 111(f) is 
amended--
            (1) by striking out ``45 working days'' and inserting in 
        lieu thereof ``65 days''; and
            (2) by adding at the end the following: ``An amendment 
        which adds a new ground of protest should be resolved, to the 
        maximum extent practicable, within the time limits established 
        for resolution of the initial protest.''.

SEC. 1434. DISMISSALS OF PROTESTS.

    Section 111(f)(4) of the Federal Property and Administrative 
Services Act of 1949 (40 U.S.C. 759(f)(4)) is amended by striking out 
subparagraph (C) and inserting in lieu thereof the following:
    ``(C) The board may dismiss a protest that the board determines--
            ``(i) is frivolous;
            ``(ii) has been brought in bad faith; or
            ``(iii) does not state on its face a valid basis for 
        protest.
    ``(D) The board may impose appropriate procedural sanctions, 
including dismissal of the protest, if the board determines that the 
board's process has been willfully abused during the course of a 
protest.
    ``(E) If the board makes a determination under subparagraph (C), 
the board may impose appropriate sanctions. Such sanctions may include 
imposition of liability on the protester, or other interested party who 
joins the protest, for payment to the United States of all or that 
portion of the United States costs, for which such a finding is made, 
of reviewing the protest, including the fees and other expenses (as 
defined in section 2412(d)(2)(A) of title 28, United States Code) 
incurred by the United States in defending the protest. The Federal 
Acquisition Regulation shall provide guidance under which the head of 
an agency may initiate action to obtain such costs, unless (i) special 
circumstances would make such payment unjust, or (ii) the protester 
obtains documents or other information for the first time, after the 
protest is filed with the board, which establishes that the protest or 
a portion is frivolous or has been brought in bad faith and the 
protester then promptly withdraws the protest or portion of the 
protest.''.

SEC. 1435. AWARD OF COSTS.

    (a) Award.--Section 111(f)(5) of the Federal Property and 
Administration Services Act of 1949 (40 U.S.C. 759(f)(5)) is amended by 
striking out subparagraph (C) and inserting in lieu thereof the 
following:
    ``(C) Whenever the board makes such a determination, it may, in 
accordance with section 1304 of title 31, United States Code, further 
declare an appropriate prevailing party to be entitled to the cost of 
filing and pursuing the protest (including reasonable attorney's fees 
and consultant and expert witness fees), and bid and proposal 
preparation.''.
    (b) Definition of Prevailing Party.--Section 111(f)(9) of such Act 
(40 U.S.C. 759(f)(9)) is amended by adding at the end the following:
            ``(C) The term `prevailing party', with respect to a 
        determination of the board under paragraph (5)(B) that a 
        challenged action of a Federal agency violates a statute or 
        regulation or the conditions of a delegation of procurement 
        authority issued pursuant to this section, means a party that 
        demonstrated such violation.''.

SEC. 1436. DISMISSAL AGREEMENTS.

    Section 111(f)(5) of the Federal Property and Administrative 
Services Act of 1949 (40 U.S.C. 759(f)(5)), as amended by section 1435, 
is further amended by adding at the end the following new 
subparagraphs:
    ``(D) Any agreement that provides for the dismissal of a protest 
and involves a direct or indirect expenditure of appropriated funds 
shall be submitted to the board and shall be made a part of the public 
record (subject to any protective order considered appropriate by the 
board) before dismissal of the protest. If a Federal agency is a party 
to a settlement agreement, the submission of the agreement submitted to 
the board shall include a memorandum, signed by the contracting officer 
concerned, that describes in detail the procurement, the grounds for 
protest, the Federal Government's position regarding the grounds for 
protest, the terms of the settlement, and the agency's position 
regarding the propriety of the award or proposed award of the contract 
at issue in the protest.
    ``(E) Payment of amounts due from an agency under subparagraph (C) 
or under the terms of a settlement agreement under subparagraph (D) 
shall be made from the appropriation made by section 1304 of title 31, 
United States Code, for the payment of judgments. The Federal agency 
concerned shall reimburse that appropriation account out of funds 
available for the procurement.''.

SEC. 1437. MATTERS TO BE COVERED IN REGULATIONS.

    Section 111(f) of the Federal Property and Administrative Services 
Act of 1949 (40 U.S.C. 759(f)) is further amended--
            (1) by inserting after paragraph (6) the following:
    ``(7)(A) The board shall adopt and issue such rules and procedures 
as may be necessary to the expeditious disposition of protests filed 
under the authority of this subsection.
    ``(B) The procedures shall provide that, in the computation of any 
period described in this subsection--
            ``(i) the day of the act, event, or default from which the 
        designated period of time begins to run not be included; and
            ``(ii) the last day after such act, event, or default be 
        included, unless--
                    ``(I) such last day is a Saturday, a Sunday, or a 
                legal holiday; or
                    ``(II) in the case of a filing of a paper at the 
                board, such last day is a day on which weather or other 
                conditions make the board or Federal agency 
                inaccessible, in which event the next day that is not a 
                Saturday, Sunday, or legal holiday shall be included.
    ``(C) The procedures may provide for electronic filing and 
dissemination of documents and information required under this 
subsection and in so providing shall consider the ability of all 
parties to achieve electronic access to such documents and records.''; 
and
            (2) by striking out paragraph (8).

SEC. 1438. DEFINITION OF PROTEST.

    Section 111(f)(9) of the Federal Property and Administrative 
Services Act of 1949 (40 U.S.C. 759(f)(9)) is amended--
            (1) by amending subparagraph (A) to read as follows:
            ``(A) The term `protest' means a written objection by an 
        interested party to any of the following:
                    ``(i) A solicitation or other request by a Federal 
                agency for offers for a contract for the procurement of 
                property or services.
                    ``(ii) The cancellation of such a solicitation or 
                other request.
                    ``(iii) An award or proposed award of such a 
                contract.
                    ``(iv) A termination or cancellation of an award of 
                such a contract, if the written objection contains an 
                allegation that the termination or cancellation is 
                based in whole or in part on improprieties concerning 
                the award of the contract.''; and
            (2) by capitalizing the first letter of the first word in 
        subparagraph (B).

SEC. 1439. OVERSIGHT OF ACQUISITION OF AUTOMATIC DATA PROCESSING 
              EQUIPMENT BY FEDERAL AGENCIES.

    Section 111 of the Federal Property and Administrative Services Act 
of 1949 (40 U.S.C. 759) is amended by adding at the end the following 
new subsection:
    ``(h) Data Collection.--(1) The Administrator shall collect and 
compile data regarding the procurement of automatic data processing 
equipment under this section. The data collected and compiled shall 
include, at a minimum, with regard to each procurement the following:
            ``(A) The procuring agency.
            ``(B) The contractor.
            ``(C) The automatic data processing equipment and services 
        procured.
            ``(D) The manufacturer of the equipment procured.
            ``(E) The amount of the contract, to the extent that the 
        amount is not proprietary information.
            ``(F) The type of contract used.
            ``(G) The extent of competition for award.
                    ``(H) Compatibility restrictions.
                    ``(I) Significant modifications of the contract.
                    ``(J) Contract price, to the extent that the price 
                is not proprietary information.
    ``(2) The head of each Federal agency shall report to the 
Administrator in accordance with regulations issued by the 
Administrator all information that the Administrator determines 
necessary in order to satisfy the requirements in paragraph (1).
    ``(3) The Administrator--
                    ``(A) shall carry out a systematic, periodic review 
                of information received under this subsection;
                    ``(B) shall use such information, as appropriate, 
                to determine the compliance of Federal agencies with 
                the requirements of this section; and
                    ``(C) may take appropriate corrective action 
                regarding an agency's authority to lease and purchase 
                automatic data processing equipment upon any 
                substantial failure by the head of the agency to report 
                to the Administrator in accordance with this 
                subsection.
    ``(4) The Administrator shall take appropriate corrective action 
upon failure of a Federal agency to comply with the terms of any 
delegation of authority to lease or purchase automatic data processing 
equipment or failure to comply with any applicable law or regulation.
    ``(5) The Administrator shall require in the regulations 
implementing this subsection that (A) data collected pursuant to this 
subsection be drawn from existing Federal agency information; and (B) 
no new or additional information reporting requirements may be imposed 
on offerors or contractors to collect such data.''.

           Subtitle E--Policy, Definitions, and Other Matters

                  PART I--ARMED SERVICES ACQUISITIONS

SEC. 1501. CONGRESSIONAL DEFENSE PROCUREMENT POLICY.

    Section 2301 of title 10, United States Code, is amended to read as 
follows:
``Sec. 2301. Congressional defense procurement policy
    ``(a) The Congress finds that in order to ensure national defense 
preparedness; conserve fiscal resources; enhance science and 
technology, research and development, and production capability; 
provide for continued development and preservation of an efficient and 
responsive defense industrial base; and ensure the financial and 
ethical integrity of defense procurement programs, it is in the 
interest of the United States that property and services be acquired 
for the Department of Defense in the most timely, economic, and 
efficient manner consistent with achieving an optimum balance among 
efficient processes, full and open access to the procurement system, 
and sound implementation of socioeconomic policies. It is therefore the 
policy of Congress that--
            ``(1) full and open competitive procedures shall be used by 
        the Department of Defense in accordance with the requirements 
        of this chapter;
            ``(2) to the maximum extent practicable, the Department of 
        Defense shall acquire commercial items to meet its needs and 
        shall require prime contractors and subcontractors, at all 
        levels, which furnish other than commercial items, to 
        incorporate to the maximum extent practicable commercial items 
        as components of items being supplied to the Department;
            ``(3) when commercial items and components are not 
        available, practicable, or cost effective, the Department of 
        Defense shall acquire, and shall require prime contractors and 
        subcontractors to incorporate, nondevelopmental items and 
        components to the maximum extent practicable;
            ``(4) property and services for the Department of Defense 
        may be acquired by any kind of contract, other than cost-plus-
        a-percentage-of-cost contracts, but including multiyear 
        contracts, that will promote the interest of the United States 
        and will provide for appropriate allocation of risk between the 
        Government and the contractor with due regard to the nature of 
        the property or services to be acquired;
            ``(5) contracts, when appropriate, shall provide incentives 
        to contractors to improve productivity through investment in 
        capital facilities, equipment, flexible manufacturing 
        processes, and advanced and dual-use technology;
            ``(6) contracts for advance procurement of components, 
        parts, and materials necessary for manufacture or for logistics 
        support of a weapon system should, if practicable, be entered 
        into in a manner to achieve economic-lot purchases and more 
        efficient production rates;
            ``(7) procurement protests and disputes shall be fairly and 
        expeditiously resolved through uniform interpretation of 
        relevant laws and regulations;
            ``(8) the head of an agency shall use advance procurement 
        planning and market research and develop contract requirements 
        in such a manner as is necessary to obtain full and open 
        competition with due regard to the nature of the property or 
        services to be acquired, but may restrict competitions to 
        suppliers of commercial items to foster accomplishment of this 
        objective; and
            ``(9) the head of an agency shall develop and maintain an 
        acquisition career management program to ensure a professional 
        acquisition work force in accordance with the requirements of 
        chapter 87 of this title.
    ``(b) Further, it is the policy of Congress that procurement 
policies and procedures for the agencies named in section 2303 of this 
title shall, in accordance with the requirements of this title--
            ``(1) be issued in accordance with and conform to the 
        requirements of sections 22 and 25 of the Office of Federal 
        Procurement Policy Act (41 U.S.C. 418b and 421);
            ``(2) promote and implement the Congressional policies in 
        subsection (a) and in section 2 of the Office of Federal 
        Procurement Policy Act (41 U.S.C. 401);
            ``(3) be implemented to support the requirements of such 
        agencies in time of war or national emergency as well as in 
        peacetime;
            ``(4) promote responsiveness of the procurement system to 
        agency needs by--
                    ``(A) simplifying and streamlining procurement 
                processes, and
                    ``(B) providing incentives to encourage contractors 
                to take actions and make recommendations that would 
                reduce the costs of property or services to be 
                acquired;
            ``(5) facilitate the acquisition of commercial items and 
        commercial components at or based on commercial market prices, 
        without requiring contractors to change their business 
        practices; and
            ``(6) promote the acquisition and use of commercial items, 
        commercial components, and nondevelopmental items by requiring 
        descriptions of agency requirements, whenever practicable, in 
        terms of functions to be performed or performance required.
    ``(c) Further, it is the policy of Congress that purchases and 
contracts entered into under this chapter should be placed with small 
business concerns and concerns that are small disadvantaged businesses 
in conformance with section 2323 of this title and subsection (g) of 
section 15 of the Small Business Act (15 U.S.C. 644).
    ``(d) It is also the policy of Congress that qualified nonprofit 
agencies for the blind or severely handicapped (as defined in section 
2410d(b) of this title) shall be afforded the maximum practicable 
opportunity to provide approved commodities and services (as defined in 
such section) as subcontractors and suppliers under contracts awarded 
by the Department of Defense.''.

SEC. 1502. DEFINITIONS.

    Section 2302 of title 10, United States Code, is amended--
            (1) by striking out paragraphs (3) and (7);
            (2) by redesignating paragraph (6) as paragraph (12);
            (3) by redesignating paragraphs (2), (4), and (5) as 
        paragraphs (5), (8), and (9), respectively;
            (4) by inserting after paragraph (1) the following new 
        paragraphs:
            ``(2) The term `procurement' has the same meaning provided 
        such term in section 4(2) of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 403(2)).
            ``(3) The term `procurement system' has the same meaning 
        provided such term in section 4(3) of the Office of Federal 
        Procurement Policy Act (41 U.S.C. 403(3)).
            ``(4) The term `standards' has the same meaning provided 
        such term in section 4(4) of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 403(4)). '';
            (5) by inserting after paragraph (5) (as so redesignated) 
        the following new paragraphs:
            ``(6) The term `full and open competition' has the same 
        meaning provided such term in section 4(6) of the Office of 
        Federal Procurement Policy Act (41 U.S.C. 403(6)).
            ``(7) The term `responsible source' has the same meaning 
        provided such term in section 4(7) of the Office of Federal 
        Procurement Policy Act (41 U.S.C. 403(7)). ''; and
            (6) by inserting after paragraph (9) (as so redesignated) 
        the following new paragraphs:
            ``(10) The terms `item', `item of supply', and `supplies' 
        have the meaning provided in section 4(10) of the Office of 
        Federal Procurement Policy Act (41 U.S.C. 403(10)).
            ``(11) The term `simplified acquisition threshold' has the 
        meaning provided that term in section 4A of the Office of 
        Federal Procurement Policy Act.
            ``(12) The terms `commercial item', `nondevelopmental 
        item', `component', and `commercial component' have the 
        meanings provided those terms in section 4 of the Office of 
        Federal Procurement Policy Act (41 U.S.C. 403).''.

SEC. 1503. DELEGATION OF PROCUREMENT FUNCTIONS.

    (a) Consolidation of Delegation Authority.--(1) Section 2311 of 
title 10, United States Code, is amended to read as follows:
``Sec. 2311. Assignment and delegation of procurement functions and 
              responsibilities
    ``(a) In General.--Except to the extent expressly prohibited by 
another provision of law, the head of an agency may delegate, subject 
to his direction, to any other officer or official of that agency, any 
power under this chapter.
    ``(b) Procurements For or With Other Agencies.--Subject to 
subsection (a), to facilitate the procurement of property and services 
covered by this chapter by each agency named in section 2303 of this 
title for any other agency, and to facilitate joint procurement by 
those agencies--
            ``(1) the head of an agency may, within his agency, 
        delegate functions and assign responsibilities relating to 
        procurement;
            ``(2) the heads of two or more agencies may by agreement 
        delegate procurement functions and assign procurement 
        responsibilities from one agency to another of those agencies 
        or to an officer or civilian employee of another of those 
        agencies; and
            ``(3) the heads of two or more agencies may create joint or 
        combined offices to exercise procurement functions and 
        responsibilities.
    ``(c) Approval of Terminations and Reductions of Joint Acquisition 
Programs.--(1) The Secretary of Defense shall prescribe regulations 
that prohibit each military department participating in a joint 
acquisition program approved by the Under Secretary of Defense for 
Acquisition and Technology from terminating or substantially reducing 
its participation in such program without the approval of the Under 
Secretary.
    ``(2) The regulations shall include the following provisions:
                    ``(A) A requirement that, before any such 
                termination or substantial reduction in participation 
                is approved, the proposed termination or reduction be 
                reviewed by the Joint Requirements Oversight Council of 
                the Department of Defense.
                    ``(B) A provision that authorizes the Under 
                Secretary of Defense for Acquisition and Technology to 
                require a military department whose participation in a 
                joint acquisition program has been approved for 
                termination or substantial reduction to continue to 
                provide some or all of the funding necessary for the 
                acquisition program to be continued in an efficient 
                manner.''.
    (2) The table of sections at the beginning of chapter 137 of such 
title is amended by striking out the item relating to section 2311 and 
inserting in lieu thereof the following:

``2311. Assignment and delegation of procurement functions and 
                            responsibilities.''.
    (b) Conforming Repeal.--(1) Section 2308 of title 10, United States 
Code, is repealed.
    (2) The table of sections at the beginning of chapter 137 of such 
title is amended by striking out the item related to section 2308.

SEC. 1504. DETERMINATIONS AND DECISIONS.

    Section 2310 of title 10, United States Code, is amended to read as 
follows:
``Sec. 2310. Determinations and decisions
    ``(a) Individual or Class Determinations and Decisions 
Authorized.--Determinations and decisions required to be made under 
this chapter by the head of an agency may be made for an individual 
purchase or contract or, except to the extent expressly prohibited by 
another provision of law, for a class of purchases or contracts. Such 
determinations and decisions are final.
    ``(b) Written Findings Required.--(1) Each determination or 
decision under section 2306(g)(1), 2307(c), or 2313(c) of this title 
shall be based on a written finding by the person making the 
determination or decision. The finding shall set out facts and 
circumstances that support the determination or decision.
    ``(2) Each finding referred to in paragraph (1) is final. The head 
of the agency making such finding shall maintain a copy of the finding 
for not less than 6 years after the date of the determination or 
decision.''.

SEC. 1505. RESTRICTIONS ON UNDEFINITIZED CONTRACTUAL ACTIONS.

    (a) Clarification of Limitation.--Subsection (b) of section 2326 of 
title 10, United States Code, is amended--
            (1) in the subsection heading, by striking out ``and 
        Expenditure'';
            (2) in paragraph (1)(B), by striking out ``or expended'';
            (3) in paragraph (2), by striking out ``expend'' and 
        inserting in lieu thereof ``obligate''; and
            (4) in paragraph (3)--
                    (A) by striking out ``expended'' and inserting in 
                lieu thereof ``obligated''; and
                    (B) by striking out ``expend'' and inserting in 
                lieu thereof ``obligate''.
    (b) Waiver Authority.--Such subsection is further amended--
            (1) by redesignating paragraph (4) as paragraph (5); and
            (2) by inserting after paragraph (3) the following new 
        paragraph (4):
    ``(4) The head of an agency may waive the provisions of this 
subsection with respect to a contract of that agency if such head of an 
agency determines that the waiver is necessary in order to support a 
contingency operation.''.
    (c) Inapplicability of Restrictions to Contracts Within the 
Simplified Acquisition Threshold.--Subsection (g)(1)(B) of such section 
is amended by striking out ``small purchase threshold'' and inserting 
in lieu thereof ``simplified acquisition threshold''.

SEC. 1506. REPEAL OF REQUIREMENT RELATING TO PRODUCTION SPECIAL TOOLING 
              AND PRODUCTION SPECIAL TEST EQUIPMENT.

    (a) Repeal.--Section 2329 of title 10, United States Code, is 
repealed.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 137 of such title is amended by striking out the item related 
to section 2329.

SEC. 1507. REGULATIONS FOR BIDS.

    Section 2381(a) of title 10, United States Code, is amended by 
striking out ``(a) The Secretary'' and all that follows through the end 
of paragraph (1) and inserting in lieu thereof the following:
    ``(a) The Secretary of Defense or the Secretary of a military 
department may--
            ``(1) prescribe regulations for the preparation, 
        submission, and opening of bids for contracts; and''.

                 PART II--CIVILIAN AGENCY ACQUISITIONS

SEC. 1551. DEFINITIONS.

    Section 309 of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 259) is amended by adding at the end the following 
new subsections:
    ``(d) The term `simplified acquisition threshold' has the meaning 
provided that term by section 4A of the Office of Federal Procurement 
Policy Act.
    ``(e) The terms `commercial item', `nondevelopmental item', 
`component', and `commercial component' have the meanings provided such 
terms by section 4 of the Office of Federal Procurement Policy Act (41 
U.S.C. 403).''.

SEC. 1552. DELEGATION OF PROCUREMENT FUNCTIONS.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.), as amended by section 1301, is further 
amended by adding at the end the following new section:

``SEC. 312. ASSIGNMENT AND DELEGATION OF PROCUREMENT FUNCTIONS AND 
              RESPONSIBILITIES.

    ``(a) In General.--Except to the extent expressly prohibited by 
another provision of law, the head of an executive agency may delegate, 
subject to his direction, to any other officer or official of that 
agency, any power under this title.
    ``(b) Procurements For or With Other Agencies.--Subject to 
subsection (a), to facilitate the procurement of property and services 
covered by this title by each executive agency for any other executive 
agency, and to facilitate joint procurement by those executive 
agencies--
            ``(1) the head of an executive agency may, within his 
        executive agency, delegate functions and assign 
        responsibilities relating to procurement;
            ``(2) the heads of two or more executive agencies may by 
        agreement delegate procurement functions and assign procurement 
        responsibilities from one executive agency to another of those 
        executive agencies or to an officer or civilian employee of 
        another of those executive agencies; and
            ``(3) the heads of two or more executive agencies may 
        create joint or combined offices to exercise procurement 
        functions and responsibilities.''.

SEC. 1553. DETERMINATIONS AND DECISIONS.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.), as amended by section 1552, is further 
amended by adding at the end the following new section:

``SEC. 313. DETERMINATIONS AND DECISIONS.

    ``(a) Individual or Class Determinations and Decisions 
Authorized.--Determinations and decisions required to be made under 
this title by an agency head may be made for an individual purchase or 
contract or, except to the extent expressly prohibited by another 
provision of law, for a class of purchases or contracts. Such 
determinations and decisions are final.
    ``(b) Written Findings Required.--(1) Each determination under 
section 305(c) shall be based on a written finding by the person making 
the determination or decision. The finding shall set out facts and 
circumstances that support the determination or decision.
    ``(2) Each finding referred to in paragraph (1) is final. The 
executive agency making such finding shall maintain a copy of the 
finding for not less than 6 years after the date of the determination 
or decision.''.

SEC. 1554. REPEALS.

    The laws of the United States are amended to read as if the 
following sections of law had not been enacted:
            (1) Section 630 of Public Law 102-393.
            (2) Section 401 of Public Law 103-123.

SEC. 1555. COOPERATIVE PURCHASING.

    Subsection (b) of section 201 of the Federal Property and 
Administrative Services Act of 1949 (40 U.S.C. 481), is amended to read 
as follows:
    ``(b)(1) The Administrator shall, as far as practicable, provide 
any of the services specified in subsection (a) of this section to any 
other Federal agency, mixed-ownership Government corporation (as 
defined in section 9101 of title 31, United States Code), or the 
District of Columbia, upon its request.
    ``(2)(A) The Administrator may provide for the use of Federal 
supply schedules of the General Services Administration by any of the 
following entities upon request:
            ``(i) A State, any department or agency of a State, and any 
        political subdivision of a State, including a local government.
            ``(ii) The District of Columbia.
            ``(iii) The Commonwealth of Puerto Rico.
            ``(iv) The government of an Indian tribe (as defined in 
        section 4(e) of the Indian Self-Determination and Education 
        Assistance Act (25 U.S.C. 450b(e))).
    ``(B) Subparagraph (A) may not be construed to authorize an entity 
referred to in that subparagraph to order existing stock or inventory 
from federally owned and operated, or federally owned and contractor 
operated, supply depots, warehouses, or similar facilities.
    ``(C) In any case in which an entity listed in subparagraph (A) 
uses a Federal supply schedule, the Administrator shall require the 
entity to reimburse the General Services Administration for any 
administrative costs of using the schedule.
    ``(3)(A) Upon the request of a qualified nonprofit agency for the 
blind or other severely handicapped that is to provide a commodity or 
service to the Federal Government under the Javits-Wagner-O'Day Act, 
the Administrator may provide any of the services specified in 
subsection (a) to such agency to the extent practicable.
    ``(B) A nonprofit agency receiving services under the authority of 
subparagraph (A) shall use the services directly in making or providing 
an approved commodity or approved service to the Federal Government.
    ``(C) In this paragraph:
            ``(i) The term `qualified nonprofit agency for the blind or 
        other severely handicapped' means--
                    ``(I) a qualified nonprofit agency for the blind, 
                as defined in section 5(3) of the Javits-Wagner-O'Day 
                Act (41 U.S.C. 48b(3)); and
                    ``(II) a qualified nonprofit agency for other 
                severely handicapped, as defined in section 5(4) of 
                such Act (41 U.S.C. 48b(4)).
            ``(ii) The terms `approved commodity' and `approved 
        service' mean a commodity and a service, respectively, that has 
        been determined by the Committee for Purchase from the Blind 
        and Other Severely Handicapped under section 2 of the Javits-
        Wagner-O'Day Act (41 U.S.C. 47) to be suitable for procurement 
        by the Federal Government.
            ``(iii) The term `Javits-Wagner-O'Day Act' means the Act 
        entitled `An Act to create a Committee on Purchases of Blind-
        made Products, and for other purposes', approved June 25, 1938 
        (41 U.S.C. 46-48c), that was revised and reenacted in the Act 
        of June 23, 1971 (85 Stat. 77).''.

                   TITLE II--CONTRACT ADMINISTRATION

                      Subtitle A--Contract Payment

                  PART I--ARMED SERVICES ACQUISITIONS

SEC. 2001. CONTRACT FINANCING.

    (a) Reorganization of Principal Authority Provision.--Section 2307 
of title 10, United States Code, is amended--
            (1) by striking out the section heading and inserting in 
        lieu thereof the following:
``Sec. 2307. Contract financing'';
            (2) by inserting ``Payment Authority.--'' after ``(a)'' in 
        subsection (a);
            (3) by inserting ``Payment Amount.--'' after ``(b)'' in 
        subsection (b);
            (4) by inserting ``Security for Advance Payments.--'' after 
        ``(c)'' in subsection (c);
            (5) by inserting ``Conditions for Progress Payments.--'' 
        after ``(d)'' in subsection (d); and
            (6) by striking out ``(e)(1) In any case'' and inserting in 
        lieu thereof ``(g) Action in Case of Fraud.--(1) In any case''.
    (b) Terminology Correction.--Such section is further amended in 
subsection (a)(2) by striking out ``bid''.
    (c) Effective Date of Lien Related to Advance Payments.--Such 
section is further amended in subsection (c) by inserting before the 
period at the end of the third sentence the following: ``and is 
effective immediately upon the first advancement of funds without 
filing, notice, or any other action by the United States''.
    (d) Conditions for Progress Payments.--Such section is further 
amended in subsection (d)--
            (1) in the first sentence of paragraph (1), by striking out 
        ``work, which'' and all that follows through ``accomplished'' 
        and inserting in lieu thereof ``work accomplished that meets 
        standards established under the contract''; and
            (2) by striking out paragraph (3) and inserting in lieu 
        thereof the following:
    ``(3) This subsection applies to a contract for an amount equal to 
or greater than the simplified acquisition threshold.''.
    (e) Conditions for Payments for Commercial Items.--Such section is 
further amended by inserting after subsection (d) the following new 
subsection (e):
    ``(e) Conditions for Payments for Commercial Items.--(1) Payments 
under subsection (a) for commercial items may be made under such terms 
and conditions as the head of the agency determines are appropriate or 
customary in the commercial marketplace. The head of the agency shall 
obtain adequate security for such payments. If the security is in the 
form of a lien in favor of the United States, such lien is paramount to 
all other liens and is effective immediately upon the first payment, 
without filing, notice, or other action by the United States.
    ``(2) Advance payments made under subsection (a) for commercial 
items may include payments, in a total amount of not more than 15 
percent of the contract price, in advance of any performance of work 
under the contract.
    ``(3) The conditions of subsections (c) and (d) do not apply to 
payments made for commercial items in accordance with this 
subsection.''.
    (f) Navy Contracts.--Such section is further amended by inserting 
after subsection (e), as added by subsection (e) of this section, the 
following new subsection (f):
    ``(f) Certain Navy Contracts.--(1) The Secretary of the Navy shall 
provide that the rate for progress payments on any contract awarded by 
the Secretary for repair, maintenance, or overhaul of a naval vessel 
shall be not less than--
            ``(A) 95 percent, in the case of a firm considered to be a 
        small business; and
            ``(B) 90 percent, in the case of any other firm.
    ``(2) The Secretary of the Navy may advance to private salvage 
companies such funds as the Secretary considers necessary to provide 
for the immediate financing of salvage operations. Advances under this 
paragraph shall be made on terms that the Secretary considers adequate 
for the protection of the United States.
    ``(3) The Secretary of the Navy shall ensure that, when partial, 
progress, or other payments are made under a contract for construction 
or conversion of a naval vessel, the United States is secured by a lien 
upon work in progress and on property acquired for performance of the 
contract on account of all payments so made. The lien is paramount to 
all other liens.''.
    (g) Clerical Amendment.--The table of sections at the beginning of 
chapter 137 of title 10, United States Code, is amended by striking out 
the item relating to section 2307 and inserting in lieu thereof the 
following:

``2307. Contract financing.''.
    (h) Repeal of Superseded Provisions.--
            (1) Progress payments under certain navy contracts.--
                    (A) Repeal.--Section 7312 of title 10, United 
                States Code, is repealed.
                    (B) Clerical amendment.--The table of sections at 
                the beginning of chapter 633 of such title is amended 
                by striking out the item relating to section 7312.
            (2) Advancement of payments for navy salvage operations.--
                    (A) Repeal.--Section 7364 of such title is 
                repealed.
                    (B) Clerical amendment.--The table of sections at 
                the beginning of chapter 637 of such title is amended 
                by striking out the item relating to section 7364.
            (3) Partial payments under navy contracts--
                    (A) Repeal.--Section 7521 of such title is 
                repealed.
                    (B) Clerical amendment.--The table of sections at 
                the beginning of chapter 645 of such title is amended 
                by striking out the item relating to section 7521.
            (4) Navy research contracts.--Section 7522 of such title is 
        amended--
                    (A) by striking out subsection (b); and
                    (B) by redesignating subsection (c) as subsection 
                (b).

SEC. 2002. REPEAL OF VOUCHERING PROCEDURES SECTION.

    (a) Repeal.--Section 2355 of title 10, United States Code, is 
repealed.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 139 of such title is amended by striking out the item relating 
to section 2355.

                 PART II--CIVILIAN AGENCY ACQUISITIONS

SEC. 2051. CONTRACT FINANCING.

    (a) Reorganization of Principal Authority Provision.--Section 305 
of the Federal Property and Administrative Services Act of 1949 (41 
U.S.C. 255) is amended--
            (1) by striking out the section heading and the section 
        designation and inserting in lieu thereof the following:

``SEC. 305. CONTRACT FINANCING.'';

            (2) by inserting ``Payment Authority.--'' after ``(a)'' in 
        subsection (a);
            (3) by inserting ``Payment Amount.--'' after ``(b)'' in 
        subsection (b); and
            (4) by inserting ``Security for Advance Payments.--'' after 
        ``(c)'' in subsection (c).
    (b) Terminology Correction.--Such section is further amended in 
subsection (a)(2) by striking out ``bid''.
    (c) Effective Date of Lien Related to Advance Payments.--Such 
section is further amended in subsection (c) by inserting before the 
period at the end of the third sentence the following: ``and is 
effective immediately upon the first advancement of funds without 
filing, notice, or any other action by the United States''.
    (d) Revision of Civilian Agency Provision To Ensure Uniform 
Requirements for Progress Payments.--
            (1) In general.--Such section is further amended by adding 
        at the end the following new subsections:
    ``(d) Conditions for Progress Payments.--(1) The executive agency 
shall ensure that any payment for work in progress (including 
materials, labor, and other items) under a contract of an executive 
agency that provides for such payments is commensurate with the work 
accomplished that meets standards established under the contract. The 
contractor shall provide such information and evidence as the executive 
agency determines necessary to permit the executive agency to carry out 
the preceding sentence.
    ``(2) The executive agency shall ensure that progress payments 
referred to in paragraph (1) are not made for more than 80 percent of 
the work accomplished under the contract so long as the executive 
agency has not made the contractual terms, specifications, and price 
definite.
    ``(3) This subsection applies to a contract for an amount equal to 
or greater than the simplified acquisition threshold.
    ``(e) Conditions for Payments for Commercial Items.--(1) Payments 
under subsection (a) for commercial items may be made under such terms 
and conditions as the executive agency determines are appropriate or 
customary in the commercial marketplace. The executive agency shall 
obtain adequate security for such payments. If the security is in the 
form of a lien in favor of the United States, such lien is paramount to 
all other liens and is effective immediately upon the first payment, 
without filing, notice, or other action by the United States.
    ``(2) Advance payments made under subsection (a) for commercial 
items may include payments, in a total amount of not more than 15 
percent of the contract price, in advance of any performance of work 
under the contract.
    ``(3) The conditions of subsections (c) and (d) do not apply to 
payments made for commercial items in accordance with this subsection.
    ``(f) Action in Case of Fraud.--(1) In any case in which the remedy 
coordination official of an executive agency finds that there is 
substantial evidence that the request of a contractor for advance, 
partial, or progress payment under a contract awarded by that executive 
agency is based on fraud, the remedy coordination official shall 
recommend that the executive agency reduce or suspend further payments 
to such contractor.
    ``(2) An executive agency receiving a recommendation under 
paragraph (1) in the case of a contractor's request for payment under a 
contract shall determine whether there is substantial evidence that the 
request is based on fraud. Upon making such a determination, the 
executive agency may reduce or suspend further payments to the 
contractor under such contract.
    ``(3) The extent of any reduction or suspension of payments by an 
executive agency under paragraph (2) on the basis of fraud shall be 
reasonably commensurate with the anticipated loss to the United States 
resulting from the fraud.
    ``(4) A written justification for each decision of the executive 
agency whether to reduce or suspend payments under paragraph (2), and 
for each recommendation received by the executive agency in connection 
with such decision, shall be prepared and be retained in the files of 
the executive agency.
    ``(5) Each executive agency shall prescribe procedures to ensure 
that, before the executive agency decides to reduce or suspend payments 
in the case of a contractor under paragraph (2), the contractor is 
afforded notice of the proposed reduction or suspension and an 
opportunity to submit matters to the executive agency in response to 
such proposed reduction or suspension.
    ``(6) Not later than 180 days after the date on which an executive 
agency reduces or suspends payments to a contractor under paragraph 
(2), the remedy coordination official of the executive agency shall--
            ``(A) review the determination of fraud on which the 
        reduction or suspension is based; and
            ``(B) transmit a recommendation to the executive agency 
        whether the suspension or reduction should continue.
    ``(7) Each executive agency who receives recommendations made by a 
remedy coordination official of the executive agency to reduce or 
suspend payments under paragraph (2) during a fiscal year shall prepare 
for such year a report that contains the recommendations, the actions 
taken on the recommendations and the reasons for such actions, and an 
assessment of the effects of such actions on the Federal Government. 
Any such report shall be available to any Member of Congress upon 
request.
    ``(8) An executive agency may not delegate responsibilities under 
this subsection to any person in a position below level IV of the 
Executive Schedule.
    ``(9) In this subsection, the term `remedy coordination official', 
with respect to an executive agency, means the person or entity in that 
executive agency who coordinates within that executive agency the 
administration of criminal, civil, administrative, and contractual 
remedies resulting from investigations of fraud or corruption related 
to procurement activities.''.
            (2) Relationship to prompt payment requirements.--The 
        amendment made by paragraph (1) is not intended to impair or 
        modify procedures required by the provisions of chapter 39 of 
        title 31, United States Code, and the regulations issued 
        pursuant to such provisions of law, that relate to progress 
        payment requests, as such procedures are in effect on the date 
        of the enactment of this Act.

                    PART III--ACQUISITIONS GENERALLY

SEC. 2061. INTEREST PENALTY ON CONTRACT CLOSE-OUT LAG-TIME.

    Section 3903(a)(1) of title 31, United States Code, is amended--
            (1) by striking out ``or'' at the end of subparagraph (A);
            (2) by inserting ``or'' after the semicolon at the end of 
        subparagraph (B); and
            (3) by adding at the end the following new subparagraph:
                    ``(C) in any case in which the Government delays 
                making final payment under the contract for more than 
                one year after the date on which the contractor 
                completes all obligations under the contract (including 
                submission to the Government of final incurred costs 
                for all years covered by the contract), the date on 
                which the contractor completes such obligations;''.

                      Subtitle B--Cost Principles

                  PART I--ARMED SERVICES ACQUISITIONS

SEC. 2101. ALLOWABLE CONTRACT COSTS.

    (a) Extension of Coverage to Coast Guard and NASA; Other 
Miscellaneous Amendments.--Section 2324 of title 10, United States 
Code, is amended as follows:
            (1) Subsection (a) is amended--
                    (A) by inserting after ``(a)'' the following: 
                ``Indirect Cost That Violates a FAR Cost Principle.--
                '';
                    (B) by striking out ``Secretary of Defense'' and 
                inserting in lieu thereof ``head of an agency'';
                    (C) by striking out ``Department of Defense'' and 
                inserting in lieu thereof ``agency''; and
                    (D) by striking out ``the Department of Defense 
                Supplement'' and inserting in lieu thereof ``applicable 
                agency supplement''.
            (2) Subsection (b) is amended--
                    (A) by inserting after ``(b)'' the following: 
                ``Penalty for Violation of Cost Principle.--'';
                    (B) in subparagraph (B) of paragraph (1) by 
                striking out ``regulations issued by the Secretary'' 
                and inserting in lieu thereof ``provisions in the 
                Federal Acquisition Regulation''; and
                      (C) by striking out ``Secretary'' each place it 
                appears and inserting in lieu thereof ``head of the 
                agency''.
            (3) Subsection (c) is amended--
                    (A) by inserting after ``(c)'' the following: 
                ``Waiver of Penalty.--''; and
                    (B) by striking out ``The Secretary shall prescribe 
                regulations providing'' in the first sentence and 
                inserting in lieu thereof ``The Federal Acquisition 
                Regulation shall provide''.
            (4) Subsection (d) is amended--
                    (A) by inserting after ``(d)'' the following: 
                ``Applicability of Contract Disputes Procedure to 
                Disallowance of Cost and Assessment of Penalty.--''; 
                and
                    (B) by striking out ``the Secretary'' and inserting 
                in lieu thereof ``the head of an agency''.
            (5) Subsection (e) is amended--
                    (A) by inserting after ``(e)'' the following: 
                ``Specific Costs Not Allowable.--'';
                    (B) in subparagraph (D) of paragraph (1), by 
                striking out ``regulations of the Secretary of 
                Defense'' and inserting in lieu thereof ``provisions of 
                the Federal Acquisition Regulation'';
                    (C) in subparagraph (M) of paragraph (1), by 
                striking out ``regulations prescribed by the Secretary 
                of Defense'' and inserting in lieu thereof ``the 
                Federal Acquisition Regulation'';
                    (D) in subparagraph (A) of paragraph (2), by 
                inserting ``of Defense'' after ``Secretary'' the first 
                place it occurs;
                    (E) in subparagraph (C) of paragraph (2), by 
                striking out ``head of the agency'' in the first 
                sentence and inserting in lieu thereof ``Secretary of 
                Defense'';
                    (F) in subparagraph (A) of paragraph (3), by 
                striking out ``regulations prescribed by the 
                Secretary'' and inserting in lieu thereof ``the Federal 
                Acquisition Regulation''; and
                    (G) by amending paragraph (4) to read as follows:
    ``(4) The provisions of the Federal Acquisition Regulation 
implementing this section may establish appropriate definitions, 
exclusions, limitations, and qualifications.''.
            (6) Subsection (f) is amended--
                    (A) in paragraph (1)--
                            (i) by striking out ``(1)'' and all that 
                        follows through ``The amendments'' and 
                        inserting in lieu thereof the following: 
                        ``Required Regulations.--The Federal 
                        Acquisition Regulation shall contain provisions 
                        on the allowability of contractor costs. Such 
                        provisions'', and
                            (ii) by striking out ``These regulations'' 
                        and inserting in lieu thereof ``The 
                        regulations''; and
                    (B) in paragraphs (2), (3), and (4)--
                            (i) by striking out ``defense'' before 
                        ``contract auditor'' each place it appears, and
                            (ii) by striking out ``regulation'' each 
                        place it appears and inserting in lieu thereof 
                        ``Federal Acquisition Regulation''.
            (7) Subsection (g) is amended to read as follows:
    ``(g) Applicability of Regulations to Subcontractors.--The 
regulations referred to in subsections (e) and (f)(1) shall require 
prime contractors of a covered contract, to the maximum extent 
practicable, to apply the provisions of such regulations to all 
subcontractors of the covered contract.''.
            (8) Subsection (h) is amended--
                    (A) by inserting after ``(h)'' the following: 
                ``Contractor Certification Required.--'';
                    (B) by striking out ``by the Secretary'' in 
                paragraph (1) and inserting in lieu thereof ``in the 
                Federal Acquisition Regulation''; and
                    (C) by striking out ``Secretary of Defense'' in 
                paragraph (2) and inserting in lieu thereof ``head of 
                the agency''.
            (9) Subsection (i) is amended by striking out ``The 
        submission to the Department of Defense'' and inserting in lieu 
        thereof ``Penalties for Submission of Cost Known as Not 
        Allowable.--The submission to an agency''.
            (10) Subsection (j) is amended--
                    (A) by inserting after ``(j)'' the following: 
                ``Contractor To Have Burden of Proof.--''; and
                    (B) by striking out ``United States Claims Court'' 
                and inserting in lieu thereof ``United States Court of 
                Federal Claims''.
            (11) Subsection (k) is amended--
                    (A) by inserting after ``(k)'' the following: 
                ``Proceeding Costs Not Allowable.--'';
                    (B) in paragraph (2), by striking out ``decision by 
                the Department of Defense--'' and inserting in lieu 
                thereof ``decision--''; and
                    (C) in paragraph (4)--
                            (i) by inserting after ``head of the 
                        agency'' the following: ``or Secretary of the 
                        military department concerned'',
                            (ii) by striking out ``under regulations 
                        prescribed by such agency head'' and inserting 
                        in lieu thereof ``in accordance with the 
                        Federal Acquisition Regulation'',
                            (iii) by inserting ``or Secretary'' after 
                        ``agency head'', and
                            (iv) by inserting before the period at the 
                        end the following: ``or military department''.
    (b) Covered Contract Defined.--Such section is further amended by 
striking out subsections (l) and (m) and inserting in lieu thereof the 
following:
    ``(l) Definitions.--In this section:
            ``(1)(A) The term `covered contract' means a contract for 
        an amount in excess of $500,000 that is entered into by the 
        head of an agency, except that such term does not include a 
        fixed-price contract without cost incentives or any contract 
        for the purchase of commercial items.
            ``(B) The dollar amount in subparagraph (A) shall be 
        adjusted on October 1 of each year divisible by 5 to the 
        equivalent amount in constant fiscal year 1993 dollars (rounded 
        to the nearest $10,000).
            ``(2) The term `head of the agency' or `agency head' does 
        not include the Secretary of a military department.
            ``(3) The term `agency' means the Department of Defense, 
        the Coast Guard, and the National Aeronautics and Space 
        Administration.''.
    (c) Regulations.--The regulations of the Secretary of Defense 
implementing section 2324 of title 10, United States Code, shall remain 
in effect until the Federal Acquisition Regulation is revised to 
implement the amendments made by this section.

SEC. 2102. REPEAL OF AUTHORITY FOR CONTRACT PROFIT CONTROLS DURING 
              EMERGENCY PERIODS.

    (a) Repeal.--Section 2382 of title 10, United States Code, is 
repealed.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 141 of such title is amended by striking out the item relating 
to section 2382.

                 PART II--CIVILIAN AGENCY ACQUISITIONS

SEC. 2151. ALLOWABLE CONTRACT COSTS.

    Section 306 of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 256) is amended to read as follows:

``SEC. 306. ALLOWABLE COSTS.

    ``(a) Indirect Cost That Violates a FAR Cost Principle.--An 
executive agency shall require that a covered contract provide that if 
the contractor submits to the executive agency a proposal for 
settlement of indirect costs incurred by the contractor for any period 
after such costs have been accrued and if that proposal includes the 
submission of a cost which is unallowable because the cost violates a 
cost principle in the Federal Acquisition Regulation (referred to in 
section 25(c)(1) of the Office of Federal Procurement Policy Act (41 
U.S.C. 421(c)(1)) or an executive agency supplement to the Federal 
Acquisition Regulation, the cost shall be disallowed.
    ``(b) Penalty for Violation of Cost Principle.--(1) If the 
executive agency determines that a cost submitted by a contractor in 
its proposal for settlement is expressly unallowable under a cost 
principle referred to in subsection (a) that defines the allowability 
of specific selected costs, the executive agency shall assess a penalty 
against the contractor in an amount equal to--
            ``(A) the amount of the disallowed cost allocated to 
        covered contracts for which a proposal for settlement of 
        indirect costs has been submitted; plus
            ``(B) interest (to be computed based on provisions in the 
        Federal Acquisition Regulation) to compensate the United States 
        for the use of any funds which a contractor has been paid in 
        excess of the amount to which the contractor was entitled.
    ``(2) If the executive agency determines that a proposal for 
settlement of indirect costs submitted by a contractor includes a cost 
determined to be unallowable in the case of such contractor before the 
submission of such proposal, the executive agency shall assess a 
penalty against the contractor in an amount equal to two times the 
amount of the disallowed cost allocated to covered contracts for which 
a proposal for settlement of indirect costs has been submitted.
    ``(c) Waiver of Penalty.--The Federal Acquisition Regulation shall 
provide for a penalty under subsection (b) to be waived in the case of 
a contractor's proposal for settlement of indirect costs when--
            ``(1) the contractor withdraws the proposal before the 
        formal initiation of an audit of the proposal by the Federal 
        Government and resubmits a revised proposal;
            ``(2) the amount of unallowable costs subject to the 
        penalty is insignificant; or
            ``(3) the contractor demonstrates, to the contracting 
        officer's satisfaction, that--
                    ``(A) it has established appropriate policies and 
                personnel training and an internal control and review 
                system that provide assurances that unallowable costs 
                subject to penalties are precluded from being included 
                in the contractor's proposal for settlement of indirect 
                costs; and
                    ``(B) the unallowable costs subject to the penalty 
                were inadvertently incorporated into the proposal.
    ``(d) Applicability of Contract Disputes Procedure to Disallowance 
of Cost and Assessment of Penalty.--An action of an executive agency 
under subsection (a) or (b)--
            ``(1) shall be considered a final decision for the purposes 
        of section 6 of the Contract Disputes Act of 1978 (41 U.S.C. 
        605); and
            ``(2) is appealable in the manner provided in section 7 of 
        such Act (41 U.S.C. 606).
    ``(e) Specific Costs Not Allowable.--(1) The following costs are 
not allowable under a covered contract:
            ``(A) Costs of entertainment, including amusement, 
        diversion, and social activities, and any costs directly 
        associated with such costs (such as tickets to shows or sports 
        events, meals, lodging, rentals, transportation, and 
        gratuities).
            ``(B) Costs incurred to influence (directly or indirectly) 
        legislative action on any matter pending before Congress or a 
        State legislature.
            ``(C) Costs incurred in defense of any civil or criminal 
        fraud proceeding or similar proceeding (including filing of any 
        false certification) brought by the United States where the 
        contractor is found liable or had pleaded nolo contendere to a 
        charge of fraud or similar proceeding (including filing of a 
        false certification).
            ``(D) Payments of fines and penalties resulting from 
        violations of, or failure to comply with, Federal, State, 
        local, or foreign laws and regulations, except when incurred as 
        a result of compliance with specific terms and conditions of 
        the contract or specific written instructions from the 
        contracting officer authorizing in advance such payments in 
        accordance with applicable provisions of the Federal 
        Acquisition Regulation.
            ``(E) Costs of membership in any social, dining, or country 
        club or organization.
            ``(F) Costs of alcoholic beverages.
            ``(G) Contributions or donations, regardless of the 
        recipient.
            ``(H) Costs of advertising designed to promote the 
        contractor or its products.
            ``(I) Costs of promotional items and memorabilia, including 
        models, gifts, and souvenirs.
            ``(J) Costs for travel by commercial aircraft which exceed 
        the amount of the standard commercial fare.
            ``(K) Costs incurred in making any payment (commonly known 
        as a `golden parachute payment') which is--
                    ``(i) in an amount in excess of the normal 
                severance pay paid by the contractor to an employee 
                upon termination of employment; and
                    ``(ii) is paid to the employee contingent upon, and 
                following, a change in management control over, or 
                ownership of, the contractor or a substantial portion 
                of the contractor's assets.
            ``(L) Costs of commercial insurance that protects against 
        the costs of the contractor for correction of the contractor's 
        own defects in materials or workmanship.
            ``(M) Costs of severance pay paid by the contractor to 
        foreign nationals employed by the contractor under a service 
        contract performed outside the United States, to the extent 
        that the amount of severance pay paid in any case exceeds the 
        amount paid in the industry involved under the customary or 
        prevailing practice for firms in that industry providing 
        similar services in the United States, as determined under the 
        Federal Acquisition Regulation.
            ``(N) Costs of severance pay paid by the contractor to a 
        foreign national employed by the contractor under a service 
        contract performed in a foreign country if the termination of 
        the employment of the foreign national is the result of the 
        closing of, or the curtailment of activities at, a United 
        States facility in that country at the request of the 
        government of that country.
            ``(O) Costs incurred by a contractor in connection with any 
        criminal, civil, or administrative proceeding commenced by the 
        United States or a State, to the extent provided in subsection 
        (k).
    ``(2)(A) Pursuant to the Federal Acquisition Regulation and subject 
to the availability of appropriations, an executive agency, in awarding 
a covered contract, may waive the application of the provisions of 
paragraphs (1)(M) and (1)(N) to that contract if the executive agency 
determines that--
            ``(i) the application of such provisions to the contract 
        would adversely affect the continuation of a program, project, 
        or activity that provides significant support services for 
        employees of the executive agency posted outside the United 
        States;
            ``(ii) the contractor has taken (or has established plans 
        to take) appropriate actions within the contractor's control to 
        minimize the amount and number of incidents of the payment of 
        severance pay by the contractor to employees under the contract 
        who are foreign nationals; and
            ``(iii) the payment of severance pay is necessary in order 
        to comply with a law that is generally applicable to a 
        significant number of businesses in the country in which the 
        foreign national receiving the payment performed services under 
        the contract or is necessary to comply with a collective 
        bargaining agreement.
    ``(B) An executive agency shall include in the solicitation for a 
covered contract a statement indicating--
            ``(i) that a waiver has been granted under subparagraph (A) 
        for the contract; or
            ``(ii) whether the executive agency will consider granting 
        such a waiver, and, if the executive agency will consider 
        granting a waiver, the criteria to be used in granting the 
        waiver.
    ``(C) An executive agency shall make the final determination 
regarding whether to grant a waiver under subparagraph (A) with respect 
to a covered contract before award of the contract.
    ``(3) The provisions of the Federal Acquisition Regulation 
implementing this section may establish appropriate definitions, 
exclusions, limitations, and qualifications. Any submission by a 
contractor of costs which are incurred by the contractor and which are 
claimed to be allowable under Department of Energy management and 
operating contracts shall be considered a `proposal for settlement of 
indirect costs incurred by the contractor for any period after such 
costs have been accrued', as used in this section.
    ``(f) Required Regulations.--(1) The Federal Acquisition Regulation 
shall contain provisions on the allowability of contractor costs. Such 
provisions shall define in detail and in specific terms those costs 
which are unallowable, in whole or in part, under covered contracts. 
The regulations shall, at a minimum, clarify the cost principles 
applicable to contractor costs of the following:
            ``(A) Air shows.
            ``(B) Membership in civic, community, and professional 
        organizations.
            ``(C) Recruitment.
            ``(D) Employee morale and welfare.
            ``(E) Actions to influence (directly or indirectly) 
        executive branch action on regulatory and contract matters 
        (other than costs incurred in regard to contract proposals 
        pursuant to solicited or unsolicited bids).
            ``(F) Community relations.
            ``(G) Dining facilities.
            ``(H) Professional and consulting services, including legal 
        services.
            ``(I) Compensation.
            ``(J) Selling and marketing.
            ``(K) Travel.
            ``(L) Public relations.
            ``(M) Hotel and meal expenses.
            ``(N) Expense of corporate aircraft.
            ``(O) Company-furnished automobiles.
            ``(P) Advertising.
    ``(2) The Federal Acquisition Regulation shall require that a 
contracting officer not resolve any questioned costs until the 
contracting officer has obtained--
            ``(A) adequate documentation with respect to such costs; 
        and
            ``(B) the opinion of the contract auditor on the 
        allowability of such costs.
    ``(3) The Federal Acquisition Regulation shall provide that, to the 
maximum extent practicable, a contract auditor be present at any 
negotiation or meeting with the contractor regarding a determination of 
the allowability of indirect costs of the contractor.
    ``(4) The Federal Acquisition Regulation shall require that all 
categories of costs designated in the report of a contract auditor as 
questioned with respect to a proposal for settlement be resolved in 
such a manner that the amount of the individual questioned costs that 
are paid will be reflected in the settlement.
    ``(g) Applicability of Regulations to Subcontractors.--The 
regulations referred to in subsections (e) and (f)(1) shall require 
prime contractors of a covered contract, to the maximum extent 
practicable, to apply the provisions of such regulations to all 
subcontractors of the covered contract.
    ``(h) Contractor Certification Required.--(1) A proposal for 
settlement of indirect costs applicable to a covered contract shall 
include a certification by an official of the contractor that, to the 
best of the certifying official's knowledge and belief, all indirect 
costs included in the proposal are allowable. Any such certification 
shall be in a form prescribed in the Federal Acquisition Regulation.
    ``(2) An executive agency may, in an exceptional case, waive the 
requirement for certification under paragraph (1) in the case of any 
contract if the agency--
            ``(A) determines in such case that it would be in the 
        interest of the United States to waive such certification; and
            ``(B) states in writing the reasons for that determination 
        and makes such determination available to the public.
    ``(i) Penalties for Submission of Cost Known as Not Allowable.--The 
submission to an executive agency of a proposal for settlement of costs 
for any period after such costs have been accrued that includes a cost 
that is expressly specified by statute or regulation as being 
unallowable, with the knowledge that such cost is unallowable, shall be 
subject to the provisions of section 287 of title 18, United States 
Code, and section 3729 of title 31, United States Code.
    ``(j) Contractor To Have Burden of Proof.--In a proceeding before a 
board of contract appeals, the United States Court of Federal Claims, 
or any other Federal court in which the reasonableness of indirect 
costs for which a contractor seeks reimbursement from the United States 
is in issue, the burden of proof shall be upon the contractor to 
establish that those costs are reasonable.
    ``(k) Proceeding Costs Not Allowable.--(1) Except as otherwise 
provided in this subsection, costs incurred by a contractor in 
connection with any criminal, civil, or administrative proceeding 
commenced by the United States or a State are not allowable as 
reimbursable costs under a covered contract if the proceeding (A) 
relates to a violation of, or failure to comply with, a Federal or 
State statute or regulation, and (B) results in a disposition described 
in paragraph (2).
    ``(2) A disposition referred to in paragraph (1)(B) is any of the 
following:
            ``(A) In the case of a criminal proceeding, a conviction 
        (including a conviction pursuant to a plea of nolo contendere) 
        by reason of the violation or failure referred to in paragraph 
        (1).
            ``(B) In the case of a civil or administrative proceeding 
        involving an allegation of fraud or similar misconduct, a 
        determination of contractor liability on the basis of the 
        violation or failure referred to in paragraph (1).
            ``(C) In the case of any civil or administrative 
        proceeding, the imposition of a monetary penalty by reason of 
        the violation or failure referred to in paragraph (1).
            ``(D) A final decision--
                    ``(i) to debar or suspend the contractor,
                    ``(ii) to rescind or void the contract, or
                    ``(iii) to terminate the contract for default,
        by reason of the violation or failure referred to in paragraph 
        (1).
            ``(E) A disposition of the proceeding by consent or 
        compromise if such action could have resulted in a disposition 
        described in subparagraph (A), (B), (C), or (D).
    ``(3) In the case of a proceeding referred to in paragraph (1) that 
is commenced by the United States and is resolved by consent or 
compromise pursuant to an agreement entered into by a contractor and 
the United States, the costs incurred by the contractor in connection 
with such proceeding that are otherwise not allowable as reimbursable 
costs under such paragraph may be allowed to the extent specifically 
provided in such agreement.
    ``(4) In the case of a proceeding referred to in paragraph (1) that 
is commenced by a State, the executive agency that awarded the covered 
contract involved in the proceeding may allow the costs incurred by the 
contractor in connection with such proceeding as reimbursable costs if 
the executive agency determines, in accordance with the Federal 
Acquisition Regulation, that the costs were incurred as a result of (A) 
a specific term or condition of the contract, or (B) specific written 
instructions of the executive agency.
    ``(5)(A) Except as provided in subparagraph (C), costs incurred by 
a contractor in connection with a criminal, civil, or administrative 
proceeding commenced by the United States or a State in connection with 
a covered contract may be allowed as reimbursable costs under the 
contract if such costs are not disallowable under paragraph (1), but 
only to the extent provided in subparagraph (B).
    ``(B)(i) The amount of the costs allowable under subparagraph (A) 
in any case may not exceed the amount equal to 80 percent of the amount 
of the costs incurred, to the extent that such costs are determined to 
be otherwise allowable and allocable under the Federal Acquisition 
Regulation.
    ``(ii) Regulations issued for the purpose of clause (i) shall 
provide for appropriate consideration of the complexity of procurement 
litigation, generally accepted principles governing the award of legal 
fees in civil actions involving the United States as a party, and such 
other factors as may be appropriate.
    ``(C) In the case of a proceeding referred to in subparagraph (A), 
contractor costs otherwise allowable as reimbursable costs under this 
paragraph are not allowable if (i) such proceeding involves the same 
contractor misconduct alleged as the basis of another criminal, civil, 
or administrative proceeding, and (ii) the costs of such other 
proceeding are not allowable under paragraph (1).
    ``(6) In this subsection:
            ``(A) The term `proceeding' includes an investigation.
            ``(B) The term `costs', with respect to a proceeding--
                    ``(i) means all costs incurred by a contractor, 
                whether before or after the commencement of any such 
                proceeding; and
                    ``(ii) includes--
                            ``(I) administrative and clerical expenses;
                            ``(II) the cost of legal services, 
                        including legal services performed by an 
                        employee of the contractor;
                            ``(III) the cost of the services of 
                        accountants and consultants retained by the 
                        contractor; and
                            ``(IV) the pay of directors, officers, and 
                        employees of the contractor for time devoted by 
                        such directors, officers, and employees to such 
                        proceeding.
            ``(C) The term `penalty' does not include restitution, 
        reimbursement, or compensatory damages.
    ``(l) Covered Contract Defined.--(1) In this section, the term 
`covered contract' means a contract for an amount in excess of $500,000 
that is entered into by an executive agency, except that such term does 
not include a fixed-price contract without cost incentives or any 
contract for the purchase of commercial items.
    ``(2) The dollar amount in paragraph (1) shall be adjusted on 
October 1 of each year divisible by 5 to the equivalent amount in 
constant fiscal year 1993 dollars (rounded to the nearest $10,000).''.

SEC. 2152. REVISION OF COST PRINCIPLE RELATING TO ENTERTAINMENT, GIFT, 
              AND RECREATION COSTS FOR CONTRACTOR EMPLOYEES.

    (a) Costs Not Allowable.--The costs of entertainment, gifts, or 
recreation for employees of a contractor or members of their families 
that are provided by the contractor to improve employee morale or 
performance or for any other purpose are not allowable under a covered 
contract unless, within 120 days of the date of the enactment of this 
Act, the Federal Acquisition Regulatory Council prescribes amendments 
to the Federal Acquisition Regulation specifying circumstances under 
which such costs are allowable under a covered contract. At a minimum, 
such amendments shall ensure that costs specifically not allowable 
under the entertainment cost principle (FAR 31.205-14) are not 
allowable under any other cost principle.
    (b) Definitions.--In this section:
            (1) The term ``employee'' includes officers and directors 
        of a contractor.
            (2) The term ``covered contract'' has the meaning given 
        such term in section 2324(l) of title 10, United States Code 
        (as amended by section 2101(b)), or section 306(l) of the 
        Federal Property and Administrative Services Act of 1949 (as 
        added by section 2151).
    (c) Effective Date.--The provisions of subsection (a), including 
any amendments to the Federal Acquisition Regulation prescribed under 
that subsection, shall take effect in accordance with section 9001.

                    PART III--ACQUISITIONS GENERALLY

SEC. 2161. TRAVEL EXPENSES OF GOVERNMENT CONTRACTORS.

    Section 24(a) of the Office of Federal Procurement Policy Act (41 
U.S.C. 420) is amended by inserting after ``Under any contract'' the 
following: ``requiring submission of cost or pricing data or the 
negotiation of final indirect costs''.

                Subtitle C--Audit and Access to Records

                  PART I--ARMED SERVICES ACQUISITIONS

SEC. 2201. CONSOLIDATION AND REVISION OF AUTHORITY TO EXAMINE RECORDS 
              OF CONTRACTORS.

    (a) Authority.--
            (1) In general.--Section 2313 of title 10, United States 
        Code, is amended to read as follows:
``Sec. 2313. Examination of records of contractor
    ``(a) Agency Authority.--(1) The head of an agency, acting through 
an authorized representative, is authorized to inspect the plant and 
audit the records of--
            ``(A) a contractor performing a cost-reimbursement, 
        incentive, time-and-materials, labor-hour, or price-
        redeterminable contract, or any combination of such contracts, 
        made by that agency under this chapter; and
            ``(B) a subcontractor performing any cost-reimbursement, 
        incentive, time-and-materials, labor-hour, or price-
        redeterminable subcontract or any combination of such 
        subcontracts under a contract referred to in subparagraph (A).
    ``(2) The head of an agency, acting through an authorized 
representative, is authorized, for the purpose of evaluating the 
accuracy, completeness, and currency of cost or pricing data required 
to be submitted pursuant to section 2306a of this title with respect to 
a contract or subcontract, to examine all records of the contractor or 
subcontractor related to--
            ``(A) the proposal for the contract or subcontract;
            ``(B) the discussions conducted on the proposal;
            ``(C) pricing of the contract or subcontract; or
            ``(D) performance of the contract or subcontract.
    ``(b) DCAA Subpoena Authority.--(1) The Director of the Defense 
Contract Audit Agency (or any successor agency) may require by subpoena 
the production of any records of a contractor that the Secretary of 
Defense is authorized to audit or examine under subsection (a).
    ``(2) Any such subpoena, in the case of contumacy or refusal to 
obey, shall be enforceable by order of an appropriate United States 
district court.
    ``(3) The authority provided by paragraph (1) may not be 
redelegated.
    ``(4) The Director (or any successor official) shall submit an 
annual report to the Secretary of Defense on the exercise of such 
authority during the preceding year and the reasons why such authority 
was exercised in any instance. The Secretary shall forward a copy of 
each such report to the Committees on Armed Services of the Senate and 
House of Representatives.
    ``(c) Comptroller General Authority.--(1) Except as provided in 
paragraph (2), each contract awarded after using procedures other than 
sealed bid procedures shall provide that the Comptroller General and 
his representatives are authorized to examine any records of the 
contractor, or any of its subcontractors, that directly pertain to, and 
involve transactions relating to, the contract or subcontract.
    ``(2) Paragraph (1) does not apply to a contract or subcontract 
with a foreign contractor or foreign subcontractor if the head of the 
agency concerned determines, with the concurrence of the Comptroller 
General or his designee, that the application of that paragraph to the 
contract or subcontract would not be in the public interest. However, 
the concurrence of the Comptroller General or his designee is not 
required--
            ``(A) where the contractor or subcontractor is a foreign 
        government or agency thereof or is precluded by the laws of the 
        country involved from making its records available for 
        examination; and
            ``(B) where the head of the agency determines, after taking 
        into account the price and availability of the property and 
        services from United States sources, that the public interest 
        would be best served by not applying paragraph (1).
    ``(3) Paragraph (1) may not be construed to require a contractor or 
subcontractor to create or maintain any record that the contractor or 
subcontractor does not maintain in the ordinary course of business or 
pursuant to another provision of law.
    ``(d) Limitation on Preaward Audits Relating to Indirect Costs.--
The head of an agency may not perform a preaward audit to evaluate 
proposed indirect costs under any contract, subcontract, or 
modification to be entered into in accordance with this chapter in any 
case in which the contracting officer determines that the objectives of 
the audit can reasonably be met by accepting the results of an audit 
conducted by any other department or agency of the Federal Government 
within one year preceding the date of the contracting officer's 
determination.
    ``(e) Limitation.--The authority of the head of an agency under 
subsection (a), and the authority of the Comptroller General under 
subsection (c), with respect to a contract or subcontract shall expire 
three years after final payment under such contract or subcontract.
    ``(f) Inapplicability to Certain Contracts.--This section does not 
apply to the following contracts:
            ``(1) Contracts for utility services at rates not exceeding 
        those established to apply uniformly to the public, plus any 
        applicable reasonable connection charge.
    ``(g) Forms of Original Record Storage.--Nothing in this section 
shall be construed to preclude a contractor from duplicating or storing 
original records in electronic form.
    ``(h) Use of Images of Original Records.--The head of an agency 
shall not require a contractor or subcontractor to provide original 
records in an audit carried out pursuant to this section if the 
contractor or subcontractor provides photographic or electronic images 
of the original records and meets the following requirements:
            ``(1) The contractor or subcontractor has established 
        procedures to ensure that the imaging process preserves the 
        integrity, reliability, and security of the original records.
            ``(2) The contractor or subcontractor maintains an 
        effective indexing system to permit timely and convenient 
        access to the imaged records.
            ``(3) The contractor or subcontractor retains the original 
        records for a minimum of one year after imaging to permit 
        periodic validation of the imaging systems.
    ``(i) Records Defined.--In this section, the term `records' 
includes books, documents, accounting procedures and practices, and 
other data, regardless of type and regardless of whether such items are 
in written form, in the form of computer data, or in any other form.''.
            (2) Clerical amendment.--The item relating to such section 
        in the table of sections at the beginning of chapter 137 of 
        title 10, United States Code, is amended to read as follows:

``2313. Examination of records of contractor.''.
    (b) Repeal of Superseded Provision.--
            (1) Repeal.--Section 2406 of title 10, United States Code, 
        is repealed.
            (2) Clerical amendment.--The table of sections at the 
        beginning of chapter 141 of such title is amended by striking 
        out the item relating to section 2406.

                 PART II--CIVILIAN AGENCY ACQUISITIONS

SEC. 2251. AUTHORITY TO EXAMINE RECORDS OF CONTRACTORS.

    (a) Authority.--Title III of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 251 et seq.), as amended 
by section 1251(2), is further amended by inserting after section 304B 
the following new section:

``SEC. 304C. EXAMINATION OF RECORDS OF CONTRACTOR.

    ``(a) Agency Authority.--(1) The head of an executive agency, 
acting through an authorized representative, is authorized to inspect 
the plant and audit the records of--
            ``(A) a contractor performing a cost-reimbursement, 
        incentive, time-and-materials, labor-hour, or price-
        redeterminable contract, or any combination of such contracts, 
        made by that executive agency under this title; and
            ``(B) a subcontractor performing any cost-reimbursement, 
        incentive, time-and-materials, labor-hour, or price-
        redeterminable subcontract or any combination of such 
        subcontracts under a contract referred to in subparagraph (A).
    ``(2) The head of an executive agency, acting through an authorized 
representative, is authorized, for the purpose of evaluating the 
accuracy, completeness, and currency of cost or pricing data required 
to be submitted pursuant to section 304B with respect to a contract or 
subcontract, to examine all records of the contractor or subcontractor 
related to--
            ``(A) the proposal for the contract or subcontract;
            ``(B) the discussions conducted on the proposal;
            ``(C) pricing of the contract or subcontract; or
            ``(D) performance of the contract or subcontract.
    ``(b) Comptroller General Authority.--(1) Except as provided in 
paragraph (2), each contract awarded after using procedures other than 
sealed bid procedures shall provide that the Comptroller General and 
his representatives are authorized to examine any records of the 
contractor, or any of its subcontractors, that directly pertain to, and 
involve transactions relating to, the contract or subcontract.
    ``(2) Paragraph (1) does not apply to a contract or subcontract 
with a foreign contractor or foreign subcontractor if the executive 
agency concerned determines, with the concurrence of the Comptroller 
General or his designee, that the application of that paragraph to the 
contract or subcontract would not be in the public interest. However, 
the concurrence of the Comptroller General or his designee is not 
required--
            ``(A) where the contractor or subcontractor is a foreign 
        government or agency thereof or is precluded by the laws of the 
        country involved from making its records available for 
        examination; and
            ``(B) where the executive agency determines, after taking 
        into account the price and availability of the property and 
        services from United States sources, that the public interest 
        would be best served by not applying paragraph (1).
    ``(3) Paragraph (1) may not be construed to require a contractor or 
subcontractor to create or maintain any record that the contractor or 
subcontractor does not maintain in the ordinary course of business or 
pursuant to another provision of law.
    ``(c) Limitation on Preaward Audits Relating to Indirect Costs.--An 
executive agency may not perform a preaward audit to evaluate proposed 
indirect costs under any contract, subcontract, or modification to be 
entered into in accordance with this title in any case in which the 
contracting officer determines that the objectives of the audit can 
reasonably be met by accepting the results of an audit conducted by any 
other department or agency of the Federal Government within one year 
preceding the date of the contracting officer's determination.
    ``(d) Limitation.--The authority of an executive agency under 
subsection (a), and the authority of the Comptroller General under 
subsection (b), with respect to a contract or subcontract shall expire 
three years after final payment under such contract or subcontract.
    ``(e) Inapplicability to Certain Contracts.--This section does not 
apply to the following contracts:
            ``(1) Contracts for utility services at rates not exceeding 
        those established to apply uniformly to the public, plus any 
        applicable reasonable connection charge.
    ``(f) Form of Original Record Storage.--Nothing in this section 
shall be construed to preclude a contractor from duplicating or storing 
original records in electronic form.
    ``(g) Use of Images of Original Records.--An executive agency shall 
not require a contractor or subcontractor to provide original records 
in an audit carried out pursuant to this section if the contractor or 
subcontractor provides photographic or electronic images of the 
original records and meets the following requirements:
            ``(1) The contractor or subcontractor has established 
        procedures to ensure that the imaging process preserves the 
        integrity, reliability, and security of the original records.
            ``(2) The contractor or subcontractor maintains an 
        effective indexing system to permit timely and convenient 
        access to the imaged records.
            ``(3) The contractor or subcontractor retains the original 
        records for a minimum of one year after imaging to permit 
        periodic validation of the imaging systems.
    ``(h) Records Defined.--In this section, the term `records' 
includes books, documents, accounting procedures and practices, and 
other data, regardless of type and regardless of whether such items are 
in written form, in the form of computer data, or in any other form.''.
    (b) Repeal of Superseded Provision.--Section 304 of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 254) is 
amended by striking out subsection (c).

                 Subtitle D--Cost Accounting Standards

SEC. 2301. REPEAL OF OBSOLETE DEADLINE REGARDING PROCEDURAL REGULATIONS 
              FOR THE COST ACCOUNTING STANDARDS BOARD.

    Section 26(f)(3) of the Office of Federal Procurement Policy Act 
(41 U.S.C. 422(f)(3)) is amended in the first sentence by striking out 
``Not later than 180 days after the date of enactment of this section, 
the Administrator'' and inserting in lieu thereof ``The 
Administrator''.

 Subtitle E--Administration of Contract Provisions Relating to Price, 
                     Delivery, and Product Quality

SEC. 2401. CLARIFICATION OF PROVISION RELATING TO QUALITY CONTROL OF 
              CERTAIN SPARE PARTS.

    The second sentence of subsection (a) of section 2383 of title 10, 
United States Code, is amended to read as follows: ``In establishing 
the appropriate qualification requirements, the Secretary of Defense 
shall use the Department of Defense qualification requirements that 
were used to qualify the original production part unless the Secretary 
determines in writing--
            ``(1) that there are other requirements sufficiently 
        similar to those requirements that should be used instead; or
            ``(2) that any or all such requirements are unnecessary.''.

SEC. 2402. CONTRACTOR GUARANTEES REGARDING WEAPON SYSTEMS.

    (a) Repeal of Requirement for Report on Waivers.--Subsection (e) of 
section 2403 of title 10, United States Code, is amended--
            (1) by striking out ``(1)''; and
            (2) by striking out paragraph (2).
    (b) Provisions To Be Addressed by Regulations.--Subsection (h) of 
such section is amended--
            (1) by redesignating paragraph (2) as paragraph (3); and
            (2) by inserting after paragraph (1) the following new 
        paragraph (2):
    ``(2) The regulations shall include the following:
            ``(A) Guidelines for negotiating contractor guarantees that 
        are reasonable and cost effective, as determined on the basis 
        of the likelihood of defects and the estimated cost of 
        correcting such defects.
            ``(B) Procedures for administering contractor guarantees.
            ``(C) Guidelines for determining the cases in which it may 
        be appropriate to waive the requirements of this section.''.

                    Subtitle F--Claims and Disputes

SEC. 2501. CERTIFICATION OF CONTRACT CLAIMS.

    (a) DOD Certification Requirement in Conflict With Government-Wide 
Requirement.--
            (1) Repeal.--Section 2410 of title 10, United States Code, 
        is repealed.
            (2) Clerical amendment.--The table of sections at the 
        beginning of chapter 141 of such title is amended by striking 
        out the item relating to section 2410.
    (b) Repeal of Superseded Provision.--Section 813(b) of the National 
Defense Authorization Act for Fiscal Year 1993 (Public Law 102-484; 106 
Stat. 2453), is repealed.
    (c) Restriction on Legislative Payment of Claims.--Section 2410e of 
title 10, United States Code, is amended by adding at the end the 
following new subsection:
    ``(d) Restriction on Legislative Payment of Claims.--In the case of 
a contract of an agency named in section 2303(a) of this title, no 
provision of a law enacted after the date of the enactment of the 
Federal Acquisition Improvement Act of 1994 that directs the payment of 
a particular claim under such contract, a particular request for 
equitable adjustment to any term of such contract, or a particular 
request for relief under Public Law 85-804 (50 U.S.C. 1431 et seq.) 
regarding such contract may be implemented unless such provision of 
law--
            ``(1) specifically refers to this subsection; and
            ``(2) specifically states that this subsection does not 
        apply with respect to the payment directed by that provision of 
        law.''.

SEC. 2502. SHIPBUILDING CLAIMS.

    (a) Increase in Time Period During Which Adjustments to 
Shipbuilding Claims May Be Made.--Section 2405 of title 10, United 
States Code, is amended--
            (1) in subsection (a)--
                    (A) by striking out ``entered into after December 
                7, 1983,''; and
                    (B) by striking out ``occurring more than 18 months 
                before the submission of the claim, request, or 
                demand.'' and inserting in lieu thereof the following: 
                ``occurring--
            ``(1) in the case of a contract entered into after December 
        7, 1983, and before the date of the enactment of the Federal 
        Acquisition Improvement Act of 1994, more than 18 months before 
        the submission of the claim, request, or demand; and
            ``(2) in the case of a contract entered into on or after 
        the date of the enactment of the Federal Acquisition 
        Improvement Act of 1994, more than 6 years before the 
        submission of the claim, request, or demand.''.
    (b) Resubmission With Corrected Certification.--Subsection (c) of 
such section is repealed.

         TITLE III--MAJOR SYSTEMS AND SERVICE SPECIFIC STATUTES

                   Subtitle A--Major Systems Statutes

SEC. 3001. WEAPON DEVELOPMENT AND PROCUREMENT SCHEDULES.

    (a) Deadline and Purpose.--Subsection (a) of section 2431 of title 
10, United States Code, is amended--
            (1) in the first sentence--
                    (A) by striking out ``at the same time'' and 
                inserting in lieu thereof ``not later than 45 days 
                after''; and
                    (B) by striking out ``a written report'' and 
                inserting in lieu thereof ``budget justification 
                documents''; and
            (2) in the second and third sentences, by striking out 
        ``report'' and inserting in lieu thereof ``documents''.
    (b) Additional Matters To Be Included.--Subsection (b) of such 
section is amended--
            (1) by striking out ``include--'' and inserting in lieu 
        thereof ``include each of the following:'';
            (2) by capitalizing the first letter of the first word in 
        each of paragraphs (1), (2), and (3);
            (3) by striking out the semicolon at the end of paragraphs 
        (1) and (2) and inserting in lieu thereof a period;
            (4) by striking out ``; and'' at the end of paragraph (3) 
        and inserting in lieu thereof a period; and
            (5) by amending paragraph (4) to read as follows:
            ``(4)(A) The most efficient production rate, the most 
        efficient acquisition rate, and the minimum sustaining rate, 
        consistent with the program priority established for such 
        weapon system by the Secretary concerned.
            ``(B) In this paragraph:
                    ``(i) The term `most efficient production rate' 
                means the maximum rate for each budget year at which 
                the weapon system can be produced with existing or 
                planned plant capacity and tooling, with one shift a 
                day running for eight hours a day and five days a week.
                    ``(ii) The term `minimum sustaining rate' means the 
                production rate for each budget year that is necessary 
                to keep production lines open while maintaining a base 
                of responsive vendors and suppliers.''.

SEC. 3002. SELECTED ACQUISITION REPORT REQUIREMENT.

    (a) Definition of Procurement Unit Cost.--
            (1) Definition.--Paragraph (2) of section 2432(a) of title 
        10, United States Code, is amended--
                    (A) in clause (A), by striking out ``for a fiscal 
                year'' and all that follows through ``such program in 
                such fiscal year'';
                    (B) in clause (B), by striking out ``with such 
                funds during such fiscal year.'' and inserting in lieu 
                thereof a period; and
                    (C) by striking out the last sentence.
            (2) Conforming amendments.--Section 2433 of such title is 
        amended--
                    (A) in subparagraph (B) of subsection (c)(1), by 
                striking out ``current'' before ``procurement unit 
                cost'';
                    (B) in subsection (d), by striking out ``current'' 
                before ``procurement unit cost'' each place it appears; 
                and
                    (C) in subsection (e), by striking out ``current'' 
                before ``procurement unit cost'' both places it 
                appears.
    (b) Exclusion of Firm, Fixed-Price Contracts.--Subsection (a) of 
section 2432 of such title is amended in paragraph (3) by inserting 
before the period at the end the following: ``and that is not a firm, 
fixed price contract''.
    (c) Definition of Full Life-Cycle Cost.--Such subsection is further 
amended in paragraph (4) by striking out ``has the meaning'' and all 
that follows through the end of the paragraph and inserting in lieu 
thereof the following: ``means all costs of development, procurement, 
military construction, and operations and support, without regard to 
funding source or management control.''.
    (d) Notice of Proposed Changes in SAR.--Subsection (c) of such 
section is amended in paragraph (2) by striking out the second sentence 
and inserting in lieu thereof the following: ``Whenever the Secretary 
of Defense proposes to make changes in the content of a Selected 
Acquisition Report, the Secretary shall submit a notice of the proposed 
changes to such committees. The changes shall be considered approved by 
the Secretary, and may be incorporated into the report, only after the 
end of the 60-day period beginning on the date on which the notice is 
received by those committees.''.
    (e) Elimination of Certain SAR Requirements.--Such subsection is 
further amended in paragraph (3) by striking out subparagraph (C).
    (f) Uniform Implementation of Life-Cycle Cost Analysis.--Such 
subsection is further amended--
            (1) by striking out paragraph (5); and
            (2) by adding at the end of subparagraph (A) of paragraph 
        (3) the following: ``The Secretary of Defense shall ensure that 
        this subparagraph is implemented in a uniform manner, to the 
        extent practicable, throughout the Department of Defense.''.
    (g) Deadline Revision.--Subsection (f) of such section is amended 
by striking out ``60 days'' in the first sentence and inserting in lieu 
thereof ``45 days''.
    (h) Elimination of Preliminary Report.--Such subsection is further 
amended by striking out the second sentence.
    (i) Terminology Corrections.--Such section is further amended as 
follows:
            (1) Subsection (b)(3)(A) is amended by striking out ``full 
        scale development or'' in clause (i).
            (2) Subsection (c)(3) is amended by striking out ``full-
        scale engineering'' in subparagraph (A) and inserting in lieu 
        thereof ``engineering and manufacturing''.
            (3) Subsection (h)(1) is amended by striking out ``full-
        scale engineering'' both places it appears and inserting in 
        lieu thereof ``engineering and manufacturing''.

SEC. 3003. UNIT COST REPORT REQUIREMENT.

    (a) Revision of Baseline Report Definitions.--
            (1) Revision.--Section 2433(a) of title 10, United States 
        Code, is amended--
                    (A) in paragraph (2)--
                            (i) by striking out ``Baseline Selected 
                        Acquisition Report'' and inserting in lieu 
                        thereof ``Baseline Estimate''; and
                            (ii) by striking out ``Selected Acquisition 
                        Report in which'' and all that follows through 
                        the end of the paragraph and inserting in lieu 
                        thereof ``cost estimate included in the 
                        baseline description for the program under 
                        section 2435 of this title.''; and
                    (B) by striking out paragraph (4).
            (2) Conforming amendments.--Section 2433 of such title is 
        further amended--
                    (A) in subsection (c)(1), by striking out 
                ``Baseline Report'' in subparagraphs (A) and (B) and 
                inserting in lieu thereof ``Baseline Estimate''; and
                    (B) in subsection (d), by striking out ``Baseline 
                Report'' in paragraphs (1) and (2) and inserting in 
                lieu thereof ``Baseline Estimate''.
    (b) Contents of Unit Cost Report.--Section 2433(b) of such title is 
amended in paragraph (3) by striking out ``Baseline Report was 
submitted.'' and inserting in lieu thereof ``contract was entered 
into.''.
    (c) Elimination of Certain Unit Cost Report Requirement.--Section 
2433(c) of such title, as amended by subsection (a), is further 
amended--
            (1) by striking out paragraph (2);
            (2) by striking out ``(1)'' after ``(c)''; and
            (3) by redesignating subparagraphs (A), (B), and (C) as 
        paragraphs (1), (2), and (3), respectively.
    (d) Constant Base Year Dollars.--Section 2433(f) of such title is 
amended by striking out ``include expected inflation'' and inserting in 
lieu thereof ``be stated in terms of constant base year dollars (as 
described in section 2430 of this title)''.
    (e) Contents of SAR.--Subparagraph (I) of section 2433(g)(1) of 
such title is amended to read as follows:
            ``(I) The type of the Baseline Estimate that was included 
        in the baseline description under section 2435 of this title 
        and the date of the Baseline Estimate.''.

SEC. 3004. REQUIREMENT FOR INDEPENDENT COST ESTIMATE AND MANPOWER 
              ESTIMATE BEFORE DEVELOPMENT OR PRODUCTION.

    (a) Content and Submission of Estimates.--Subsection (b) of section 
2434 of title 10, United States Code, is amended to read as follows:
    ``(b) Regulations.--The Secretary of Defense shall prescribe 
regulations governing the content and submission of the estimates 
required by subsection (a). The regulations shall require--
            ``(1) that the independent estimate of the full life-cycle 
        cost of a program--
                    ``(A) be prepared by an office or other entity that 
                is not directly responsible for carrying out the 
                development or acquisition of the program; and
                    ``(B) include all costs of development, 
                procurement, military construction, and operations and 
                support, without regard to funding source or management 
                control; and
            ``(2) that the manpower estimate include the total 
        personnel required--
                    ``(A) to operate, maintain, and support the program 
                upon full operational deployment; and
                    ``(B) to train personnel to carry out the 
                activities referred to in subparagraph (A).''.
    (b) Terminology Correction, Etc.--Subsection (a) of such section is 
amended--
            (1) by striking out ``full-scale engineering development'' 
        and inserting in lieu thereof ``engineering and manufacturing 
        development''; and
            (2) by striking out ``cost of the program, together with a 
        manpower estimate, has'' and inserting in lieu thereof ``full 
        life-cycle cost of the program and a manpower estimate have''.

SEC. 3005. BASELINE DESCRIPTION.

    (a) In General.--Section 2435 of title 10, United States Code, is 
amended to read as follows:
``Sec. 2435. Baseline description
    ``(a) Baseline Description Requirement.--(1) The Secretary of a 
military department shall establish a baseline description for each 
major defense acquisition program under the jurisdiction of such 
Secretary.
    ``(2) The baseline shall include sufficient parameters to describe 
the cost estimate (referred to as the `Baseline Estimate' in section 
2433 of this title), schedule, and performance of such major defense 
acquisition program.
    ``(3) No amount appropriated or otherwise made available to the 
Department of Defense for carrying out a major defense acquisition 
program may be obligated without an approved baseline description 
unless such obligation is specifically approved by the Under Secretary 
of Defense for Acquisition and Technology.
    ``(4) A baseline description for a major defense acquisition 
program shall be established--
            ``(A) before the program enters engineering and 
        manufacturing development; or
            ``(B) before the program enters production and deployment.
    ``(b) Regulations.--The Secretary of Defense shall prescribe 
regulations governing--
            ``(1) the content of baseline descriptions;
            ``(2) the submission of reports on deviations of a program 
        from the baseline description by the program manager to the 
        Secretary of the military department concerned and the Under 
        Secretary of Defense for Acquisition and Technology;
            ``(3) procedures for review of such deviation reports 
        within the Department of Defense; and
            ``(4) procedures for submission to, and approval by, the 
        Secretary of Defense of revised baseline descriptions.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 144 of such title is amended by amending the item relating to 
section 2435 to read as follows:

``2435. Baseline description.''.

SEC. 3006. REPEAL OF REQUIREMENT FOR COMPETITIVE PROTOTYPING FOR MAJOR 
              PROGRAMS.

    (a) Repeal.--Section 2438 of title 10, United States Code, is 
repealed.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 144 of such title is amended by striking out the item relating 
to section 2438.

SEC. 3007. REPEAL OF REQUIREMENT FOR COMPETITIVE ALTERNATIVE SOURCES 
              FOR MAJOR PROGRAMS.

    (a) Repeal.--Section 2439 of title 10, United States Code, is 
repealed.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 144 of such title is amended by striking out the item relating 
to section 2439.

                      Subtitle B--Testing Statutes

SEC. 3011. AUTHORIZATION OF LESS THAN FULL-UP TESTING.

    Section 2366(c) of title 10, United States Code, is amended--
            (1) by redesignating paragraph (2) as paragraph (4);
            (2) by designating the second sentence of paragraph (1) as 
        paragraph (3) and in that paragraph by striking out ``such 
        certification'' and inserting in lieu thereof ``certification 
        under paragraph (1) or (2)''; and
            (3) by inserting before paragraph (3) (as so designated) 
        the following new paragraph:
    ``(2) In the case of a covered system (or covered product 
improvement program for a covered system), the Secretary may waive the 
application of the survivability and lethality tests of this section to 
such system or program and instead allow testing of the system or 
program in combat by firing munitions likely to be encountered in 
combat at components, subsystems, and subassemblies, together with 
performing design analyses, modeling and simulation, and analysis of 
combat data, if the Secretary certifies to Congress that the 
survivability and lethality testing of such system or program otherwise 
required by this section would be unreasonably expensive and 
impracticable.''.

SEC. 3012. LIMITATION ON QUANTITIES TO BE PROCURED FOR LOW-RATE INITIAL 
              PRODUCTION.

    Section 2400(a) of title 10, United States Code, is amended--
            (1) in paragraph (2)--
                    (A) by striking out ``paragraph (1)'' and inserting 
                in lieu thereof ``this section''; and
                    (B) by striking out ``full-scale engineering 
                development'' and inserting in lieu thereof 
                ``engineering and manufacturing development'';
            (2) by redesignating paragraph (4) as paragraph (5) and in 
        that paragraph by inserting after the first sentence the 
        following: ``If the quantity exceeds 10 percent of the total 
        number of articles to be produced, as determined at the 
        milestone II decision with respect to that system, the 
        Secretary shall include in the statement the reasons for such 
        quantity.''; and
            (3) by inserting after paragraph (3) the following new 
        paragraph (4):
    ``(4) The quantity of articles of a major system that may be 
procured for low-rate initial production may not be less than one 
operationally configured production unit unless another quantity is 
established at the milestone II decision.''.

SEC. 3013. OPERATIONAL TEST AND EVALUATION OF DEFENSE ACQUISITION 
              PROGRAMS.

    (a) Authority To Use Different Procedures.--Section 2399(b) of 
title 10, United States Code, is amended--
            (1) by redesignating paragraph (5) as paragraph (6); and
            (2) by inserting after paragraph (4) the following new 
        paragraph (5):
    ``(5) The Secretary of Defense may, for a particular major defense 
acquisition program, prescribe and apply operational test and 
evaluation procedures other than those provided under subsection (a) 
and paragraphs (1) through (3) of this subsection if the Secretary 
transmits to Congress, before the Milestone II decision is made with 
respect to that program--
            ``(A) a certification that such testing would be 
        unreasonably expensive and impracticable; and
            ``(B) a description of the actions taken to ensure that the 
        system will be operationally effective and suitable when the 
        system meets initial operational capability requirements.''.
    (b) Cross Reference Corrections.--Section 2399 of such title is 
further amended--
            (1) in subsection (b)(6) (as redesignated by subsection 
        (a)(1)) and subsection (c)(1), by striking out ``section 
        138(a)(2)(B)'' and inserting in lieu thereof ``section 
        139(a)(2)(B)''; and
            (2) in subsection (h)(1), by striking out ``section 
        138(a)(2)(A)'' and inserting in lieu thereof ``section 
        139(a)(2)(A)''.

                  Subtitle C--Civil Reserve Air Fleet

SEC. 3021. DEFINITION OF CONTRACTOR.

    Section 9511(8) of title 10, United States Code, is amended--
            (1) by striking out ``or'' at the end of clause (A); and
            (2) by inserting before the period at the end the 
        following: ``, or (C) who owns or controls, or will own or 
        control, new or existing aircraft and who, by contract, commits 
        some or all of such aircraft to the Civil Reserve Air Fleet''.

SEC. 3022. CONSOLIDATION OF PROVISIONS RELATING TO CONTRACTUAL 
              COMMITMENT OF AIRCRAFT.

    Chapter 931 of title 10, United States Code, is amended--
            (1) in subsection (a) of section 9512, by inserting 
        ``Authority to Contract.--'' after ``(a)'';
            (2) in subsection (c) of section 9512, by striking out 
        ``(c)'' and inserting in lieu thereof ``(d) Authority To 
        Contract and Pay Directly.--'';
            (3) in subsection (b) of section 9512, by striking out 
        ``(b)'' and inserting in lieu thereof ``(c) Terms and Required 
        Repayment.--'';
            (4) by redesignating subsection (a) of section 9513 as 
        subsection (b) and transferring such subsection (as so 
        redesignated) to section 9512 and inserting such subsection 
        after subsection (a);
            (5) by redesignating subsection (b) of section 9513 as 
        subsection (e) and transferring such subsection (as so 
        redesignated) to the end of section 9512;
            (6) in subsection (b) of section 9512, as redesignated and 
        transferred to such section by paragraph (4)--
                    (A) by striking out ``under section 9512 of this 
                title'' and inserting in lieu thereof ``entered into 
                under this section'', and
                    (B) by inserting ``Contract Requirements.--'' after 
                ``(b)'';
            (7) in subsection (c) of section 9512, as redesignated by 
        paragraph (3), by striking out ``the terms required by section 
        9513 of this title and'';
            (8) in subsection (e) of section 9512, as redesignated and 
        transferred to such section by paragraph (5)--
                    (A) by striking out ``under section 9512 of this 
                title'' and inserting in lieu thereof ``entered into 
                under this section'', and
                    (B) by inserting ``Commitment to Civil Reserve Air 
                Fleet.--'' after ``(e)''; and
            (9) by striking out the heading of section 9513.

SEC. 3023. USE OF MILITARY INSTALLATIONS BY CONTRACTORS.

    (a) Authority.--Chapter 931 of title 10, United States Code, as 
amended by section 3022, is further amended by adding at the end the 
following new section 9513:
``Sec. 9513. Use of military installations by Civil Reserve Air Fleet 
              contractors
    ``(a) Contract Authority.--(1) The Secretary of the Air Force--
            ``(A) may, by contract entered into with any contractor, 
        authorize such contractor to use one or more Air Force 
        installations designated by the Secretary; and
            ``(B) with the consent of the Secretary of another military 
        department, may, by contract entered into with any contractor, 
        authorize the contractor to use one or more installations, 
        designated by the Secretary of the Air Force, that is under the 
        jurisdiction of the Secretary of such other military 
        department.
    ``(2) The Secretary of the Air Force may include in the contract 
such terms and conditions as the Secretary determines appropriate to 
promote the national defense or to protect the interests of the United 
States.
    ``(b) Purposes of Use.--A contract entered into under subsection 
(a) may authorize use of a designated installation as a weather 
alternate, as a technical stop not involving the enplaning or deplaning 
of passengers or cargo, or, in the case of an installation within the 
United States, for other commercial purposes. Notwithstanding any other 
provision of the law, the Secretary may establish different levels and 
types of uses for different installations and may provide in contracts 
under subsection (a) for different levels and types of uses by 
different contractors.
    ``(c) Hold Harmless Requirement.--A contract entered into under 
subsection (a) shall provide that the contractor agrees to indemnify 
and hold harmless the Air Force (and any other armed force having 
jurisdiction over any installation covered by the contract) from any 
action, suit, or claim of any sort resulting from, relating to, or 
arising out of any activities conducted, or services or supplies 
furnished, in connection with the contract.
    ``(d) Reservation of Right To Exclude Contractor.--A contract 
entered into under subsection (a) shall provide that the Secretary 
concerned may, without providing prior notice, deny access to an 
installation designated under the contract when the Secretary 
determines that it is necessary to do so in order to meet military 
exigencies.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by striking out the item relating to section 
9513 and inserting in lieu thereof the following:

``9513. Use of military installations by Civil Reserve Air Fleet 
                            contractors.''.

                       Subtitle D--Miscellaneous

SEC. 3051. REGULATIONS ON PROCUREMENT, PRODUCTION, WAREHOUSING, AND 
              SUPPLY DISTRIBUTION FUNCTIONS.

    (a) In General.--Section 2202 of title 10, United States Code, is 
amended to read as follows:
``Sec. 2202. Regulations on procurement, production, warehousing, and 
              supply distribution functions
    ``The Secretary of Defense shall prescribe regulations governing 
the performance within the Department of Defense of the procurement, 
production, warehousing, and supply distribution functions, and related 
functions, of the Department of Defense.''.
    (b) Clerical Amendment.--The item relating to section 2202 in the 
table of sections at the beginning of chapter 131 of such title is 
amended to read as follows:

``2202. Regulations on procurement, production, warehousing, and supply 
                            distribution functions.''.

SEC. 3052. REPEAL OF REQUIREMENTS REGARDING PRODUCT EVALUATION 
              ACTIVITIES.

    (a) Repeal.--Section 2369 of title 10, United States Code, is 
repealed.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 139 of such title is amended by striking out the item relating 
to section 2369.

SEC. 3053. CODIFICATION AND REVISION OF LIMITATION ON LEASE OF VESSELS, 
              AIRCRAFT, AND VEHICLES.

    (a) Limitation.--(1) Chapter 141 of title 10, United States Code, 
is amended by inserting after section 2401 the following new section:
``Sec. 2401a. Lease of vessels, aircraft, and vehicles
    ``The Secretary of Defense or the Secretary of a military 
department may not enter into any contract with a term of 18 months or 
more, or extend or renew any contract for a term of 18 months or more, 
for any vessel, aircraft, or vehicle, through a lease, charter, or 
similar agreement, unless the Secretary has considered all costs of 
such contract (including estimated termination liability) and has 
determined in writing that the contract is in the best interest of the 
Government.''.
    (2) The table of sections at the beginning of such chapter is 
amended by inserting after the item relating to section 2401 the 
following new item:

``2401a. Lease of vessels, aircraft, and vehicles.''.
    (b) Repeal of Superseded Provision.--Section 9081 of Public Law 
101-165 (103 Stat. 1147; 10 U.S.C. 2401 note) is repealed.

SEC. 3054. REPEAL OF APPLICATION OF PUBLIC CONTRACTS ACT TO CERTAIN 
              NAVAL VESSEL CONTRACTS.

    (a) Repeal.--Section 7299 of title 10, United States Code, is 
repealed.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 633 of such title is amended by striking out the item relating 
to section 7299.

  TITLE IV--SIMPLIFIED ACQUISITION THRESHOLD AND SOCIOECONOMIC, SMALL 
                    BUSINESS, AND MISCELLANEOUS LAWS

              Subtitle A--Simplified Acquisition Threshold

                   PART I--ESTABLISHMENT OF THRESHOLD

SEC. 4001. ESTABLISHMENT OF SIMPLIFIED ACQUISITION THRESHOLD.

    (a) Establishment.--The Office of Federal Procurement Policy Act 
(41 U.S.C. 401 et seq.) is amended by inserting after section 4 the 
following new section:

``SEC. 4A. SIMPLIFIED ACQUISITION THRESHOLD.

    ``(a) In General.--The simplified acquisition threshold for 
purposes of Federal acquisitions is (except as provided in subsection 
(b)) the amount of $25,000, as adjusted pursuant to subsection (c).
    ``(b) Agencies With FACNET Capability.--In the case of an executive 
agency, or a procuring activity of an executive agency, for which there 
is in effect a certification under 2302b(c) of title 10, United States 
Code, or section 302B(c) of the Federal Property and Administrative 
Services Act of 1949 with respect to implementation of a FACNET 
capability, the simplified acquisition threshold is the amount of 
$100,000, as adjusted pursuant to subsection (c).
    ``(c) Periodic Adjustment for Inflation.--The dollar amount in 
effect under subsection (a) shall be adjusted on October 1 of each year 
divisible by 5 to the equivalent amount in constant fiscal year 1990 
dollars (rounded to the nearest $1,000). The dollar amount in effect 
under subsection (b) shall be adjusted on October 1 of each year 
divisible by 5 to the equivalent amount in constant fiscal year 1993 
dollars (rounded to the nearest $1,000).
    ``(d) Special Rule for Contingency Operations.--In the case of a 
contract to be awarded and performed, or a purchase to be made, outside 
the United States in support of a contingency operation (as defined in 
section 101(a)(13) of title 10, United States Code), the amounts in 
effect under subsections (a) and (b) shall be two times the amounts 
otherwise applicable.''.
    (b) Conforming Amendment to Definition.--Section 4 of such Act is 
amended by striking out paragraph (11).

SEC. 4002. FEDERAL ACQUISITION COMPUTER NETWORK ARCHITECTURE.

    (a) Federal Acquisition Computer Network Architecture.--The Office 
of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), as amended 
by section 1092, is further amended by adding at the end the following 
new section:

``SEC. 30. FEDERAL ACQUISITION COMPUTER NETWORK (FACNET) ARCHITECTURE.

    ``(a) In General.--(1) The Administrator shall establish a program 
for the development and implementation of a Federal acquisition 
computer network architecture (hereinafter in this section referred to 
as `FACNET'). The Administrator shall assign a program manager for 
FACNET and shall provide for overall direction of policy and leadership 
in the development, coordination, installation, operation, and 
completion of implementation of FACNET by executive agencies.
    ``(2) In carrying out paragraph (1), the Administrator shall 
consult with appropriate Federal agencies with applicable technical and 
functional expertise, including the Office of Information and 
Regulatory Affairs, the National Institute of Standards and Technology, 
the General Services Administration, and the Department of Defense.
    ``(3) The Administrator shall carry out paragraph (1) not later 
than the date that is 5 years after the date of the enactment of the 
Federal Acquisition Improvement Act of 1994.
    ``(b) Functions of FACNET.--The FACNET architecture shall provide 
for the following functions:
            ``(1) Government functions.--Allow executive agencies to do 
        the following electronically:
                    ``(A) Provide widespread public notice of 
                solicitations for contract opportunities issued by an 
                executive agency and of orders to be made by the 
                agency.
                    ``(B) Allow responses to solicitations and requests 
                for information to be submitted to the procuring 
                activity through such system.
                    ``(C) Allow public notice of contract awards to be 
                provided through such system.
                    ``(D) In cases in which it is practicable, allow 
                questions regarding solicitations to be answered 
                through such system.
                    ``(E) Allow orders to be made through such system.
                    ``(F) In cases in which it is practicable, make 
                payments to contractors by bank card, electronic funds 
                transfer, or other automated methods.
                    ``(G) Archive data relating to each procurement 
                action made using such system.
            ``(2) User functions.--Allow private users to do the 
        following electronically:
                    ``(A) Access notice of solicitations for contract 
                opportunities issued by an executive agency and of 
                orders to be made by the executive agency.
                    ``(B) Selectively access and review solicitations 
                and orders issued by the executive agency.
                    ``(C) Respond to solicitations and notices of 
                orders issued by the executive agency.
                    ``(D) Receive orders from the executive agency.
                    ``(E) Access information on contract awards made by 
                the executive agency.
                    ``(F) In cases in which it is practicable, receive 
                payment by bank card, electronic funds transfer, or 
                other automated means.
            ``(3) General functions.--
                    ``(A) Allow the electronic exchange of procurement 
                information between the private sector and the Federal 
                Government.
                    ``(B) Employ nationally and internationally 
                recognized data formats that serve to broaden and ease 
                the electronic interchange of data.
                    ``(C) Allow convenient and universal user access 
                through a single point of entry.
    ``(c) Architecture Defined.--For purposes of this section, the term 
`architecture' means an evolving description of all functions to be 
performed to achieve the mission of streamlining procurement through 
electronic commerce, the system elements and interfaces needed to 
perform the functions, and the designation of performance levels of 
those system elements.
    ``(d) Annual Report to Congress.--The Administrator shall evaluate 
progress by executive agencies in implementing the FACNET under this 
section. The Administrator shall submit to the Congress, on the date 
that is one year after the date of the enactment of the Federal 
Acquisition Improvement Act of 1994 and on that date in each of the 5 
years thereafter, a report on the overall progress by the executive 
branch and by each executive agency in implementing this section.''.
    (b) Technical Amendments.--Section 18 of the Office of Federal 
Procurement Policy Act (41 U.S.C. 416) is amended--
            (1) in subsection (a)(1)(A), by striking out ``notice'' in 
        the matter following clause (ii) and inserting in lieu thereof 
        ``notice of solicitation''; and
            (2) in subsection (d), by striking out ``a notice under 
        subsection (e)'' in the first sentence and inserting in lieu 
        thereof ``a notice of solicitation under subsection (a)''.

SEC. 4003. IMPLEMENTATION IN ARMED SERVICES.

    (a) Establishment in Title 10.--Chapter 137 of title 10, United 
States Code, is amended by inserting after section 2302 the following 
new sections:
``Sec. 2302a. Simplified acquisition threshold
    ``(a) Simplified Acquisition Threshold.--For purposes of 
acquisitions by agencies named in section 2303 of this title, the 
simplified acquisition threshold is as specified in section 4A of the 
Office of Federal Procurement Policy Act.
``Sec. 2302b. Implementation of FACNET capability
    ``(a) Implementation of FACNET Capability.--(1) The head of each 
agency named in section 2303 of this title shall implement the Federal 
acquisition computer network (`FACNET') capability required by section 
30 of the Office of Federal Procurement Policy Act. In the case of the 
Department of Defense, the implementation shall be by the Secretary of 
Defense for the Department of Defense as a whole. For purposes of this 
section, the term `head of an agency' does not include the Secretaries 
of the military departments.
    ``(2) In implementing the FACNET capability pursuant to paragraph 
(1), the head of an agency shall consult with the Administrator for 
Federal Procurement Policy,
    ``(b) Designation of Agency Official.--(1) The Secretary of Defense 
shall designate the Under Secretary of Defense for Acquisition and 
Technology to have responsibility for implementation of FACNET 
capability throughout the Department of Defense.
    ``(2) The head of each agency named in paragraph (5) or (6) of 
section 2303 of this title shall designate a program manager to have 
responsibility for implementation of FACNET capability for that agency 
and otherwise to implement this section. Such program manager shall 
report directly to the senior procurement executive designated for the 
agency under section 16(3) of the Office of Federal Procurement Policy 
Act (41 U.S.C. 414(3)).
    ``(c) Certification of FACNET Capability.--(1) When the senior 
procurement executive of an agency or, in the case of the Department of 
Defense, the Under Secretary of Defense for Acquisition and Technology, 
determines that a procuring activity of the agency has implemented an 
interim FACNET capability (as defined in subsection (e)), the executive 
or the Under Secretary shall certify to the Administrator for Federal 
Procurement Policy that such activity has implemented an interim FACNET 
capability.
    ``(2) When the head of an agency, with the concurrence of the 
Administrator for Federal Procurement Policy, determines that the 
agency has implemented a full FACNET capability (as defined in 
subsection (f)), the head of the agency shall certify to Congress that 
the agency has implemented a full FACNET capability.
    ``(3) The head of each agency shall provide for implementation of 
both interim FACNET capability and full FACNET capability, with 
priority on providing convenient and universal user access as required 
by section 30(b)(3)(C) of the Office of Federal Procurement Policy Act, 
in that agency as soon as practicable after the date of the enactment 
of the Federal Acquisition Improvement Act of 1994.
    ``(d) Higher Simplified Acquisition Threshold When FACNET 
Capability Certified.--A certification to the Administrator for Federal 
Procurement Policy or Congress under subsection (c) shall be considered 
to be a certification for purposes of the higher simplified acquisition 
threshold under section 4A(b) of the Office of Federal Procurement 
Policy Act, except that a certification under paragraph (1) of 
subsection (c) shall not constitute such a certification in the case of 
solicitations issued after the end of the five-year period beginning on 
the date of the enactment of the Federal Acquisition Improvement Act of 
1994.
    ``(e) Implementation of Interim FACNET Capability.--A procuring 
activity shall be considered to have implemented an interim FACNET 
capability if--
            ``(1) with respect to each procurement expected to be in an 
        amount greater than the micro-purchase threshold and less than 
        the simplified acquisition threshold, the procuring activity 
        has implemented the FACNET functions described in paragraphs 
        (1)(A) and (2)(A) of section 30(b) of the Office of Federal 
        Procurement Policy Act; and
            ``(2) with respect to each procurement expected to be in an 
        amount greater than the micro-purchase threshold and less than 
        the simplified acquisition threshold, the procuring activity 
        issues notices of solicitations through a system with those 
        functions for all contracting opportunities other than in cases 
        covered by section 18(c) of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 416(c)).
    ``(f) Implementation of Full FACNET Capability.--(1) An agency 
shall be considered to have implemented a full FACNET capability if 
(except in the case of procuring activities (or portions thereof) of 
the agency for which the head of the agency determines that 
implementation is not cost effective or practicable) the agency has 
implemented all of the FACNET functions described in section 30(b) of 
the Office of Federal Procurement Policy Act.
    ``(2) For purposes of paragraph (1), an agency may not be 
considered to have implemented a full FACNET capability if--
            ``(A) the head of the agency has determined that 
        implementation of FACNET capability is not cost effective or 
        practicable in the case of certain procuring activities (or 
        portions thereof) of the agency; and
            ``(B) the percentage of the procurement actions in amounts 
        greater than the micro-purchase threshold executed by the 
        procuring activities (or portions thereof) referred to in 
        subparagraph (A) for the preceding fiscal year is greater than 
        25 percent of the total number of procurement actions in 
        amounts greater than the micro-purchase threshold executed by 
        the agency for that year.
    ``(g) Procuring Activities Originally Excluded in Certification.--
(1) If the head of an agency, in certifying under subsection (c) that 
the agency has implemented a full FACNET capability, determines that 
such implementation is not cost effective or practicable in the case of 
any procuring activity (or portion thereof) of that agency, then that 
certification shall not apply under section 4A(b) of the Office of 
Federal Procurement Policy Act to any procurement action by that 
procuring activity (or portion thereof).
    ``(2) If the head of an agency determines that an interim or a full 
FACNET capability has subsequently been implemented for that procuring 
activity (or portion thereof), the head of the agency shall make a 
certification to the Administrator for Federal Procurement Policy in 
the same manner as a certification under paragraph (1) or (2) of 
subsection (c), as applicable, and such certification shall have the 
same effect with respect to that procuring activity (or portion 
thereof) as if made under such paragraph of subsection (c).''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 137 of such title is amended by inserting after the item 
relating to section 2302 the following new items:

``2302a. Simplified acquisition threshold.
``2302b. Implementation of FACNET capability.''.

SEC. 4004. IMPLEMENTATION IN CIVILIAN AGENCIES.

    Title III of the Federal Property and Administrative Services Act 
of 1949 is amended by inserting after section 302 the following new 
sections:

``SEC. 302A. SIMPLIFIED ACQUISITION THRESHOLD.

    ``(a) Simplified Acquisition Threshold.--For purposes of 
acquisitions by executive agencies, the simplified acquisition 
threshold is as specified in section 4A of the Office of Federal 
Procurement Policy Act.

``SEC. 302B. IMPLEMENTATION OF FACNET CAPABILITY.

    ``(a) Implementation of FACNET Capability.--(1) The head of each 
executive agency shall implement the Federal acquisition computer 
network (`FACNET') capability required by section 30 of the Office of 
Federal Procurement Policy Act.
    ``(2) In implementing the FACNET capability pursuant to paragraph 
(1), the head of an executive agency shall consult with the 
Administrator for Federal Procurement Policy.
    ``(b) Designation of Agency Official.--The head of each executive 
agency shall designate a program manager to have responsibility for 
implementation of FACNET capability for that agency and otherwise to 
implement this section. Such program manager shall report directly to 
the senior procurement executive designated for the agency under 
section 16(3) of the Office of Federal Procurement Policy Act (41 
U.S.C. 414(3)).
    ``(c) Certification of FACNET Capability.--(1) When the senior 
procurement executive of an executive agency determines that a 
procuring activity of the agency has implemented an interim FACNET 
capability (as defined in subsection (e)), the executive shall certify 
to the Administrator for Federal Procurement Policy that such activity 
has implemented an interim FACNET capability.
    ``(2) When the head of an executive agency, with the concurrence of 
the Administrator for Federal Procurement Policy, determines that the 
executive agency has implemented a full FACNET capability (as defined 
in subsection (f)), the head of the executive agency shall certify to 
Congress that the agency has implemented a full FACNET capability.
    ``(3) The head of each executive agency shall provide for 
implementation of both interim FACNET capability and full FACNET 
capability, with priority on providing convenient and universal user 
access as required by section 30(b)(3)(C) of the Office of Federal 
Procurement Policy Act, in that executive agency as soon as practicable 
after the date of the enactment of the Federal Acquisition Improvement 
Act of 1994.
    ``(d) Higher Simplified Acquisition Threshold When FACNET 
Capability Certified.--A certification to the Administrator for Federal 
Procurement Policy or Congress under subsection (c) shall be considered 
to be a certification for purposes of the higher simplified acquisition 
threshold under section 4A(b) of the Office of Federal Procurement 
Policy Act, except that a certification under paragraph (1) of 
subsection (c) shall not constitute such a certification in the case of 
solicitations issued after the end of the five-year period beginning on 
the date of the enactment of the Federal Acquisition Improvement Act of 
1994.
    ``(e) Implementation of Interim FACNET Capability.--A procuring 
activity shall be considered to have implemented an interim FACNET 
capability if--
            ``(1) with respect to each procurement expected to be in an 
        amount greater than the micro-purchase threshold and less than 
        the simplified acquisition threshold, the procuring activity 
        has implemented the FACNET functions described in paragraphs 
        (1)(A) and (2)(A) of section 30(b) of the Office of Federal 
        Procurement Policy Act; and
            ``(2) with respect to each procurement expected to be in an 
        amount greater than the micro-purchase threshold and less than 
        the simplified acquisition threshold, the procuring activity 
        issues notices of solicitations through a system with those 
        functions for all contracting opportunities other than in cases 
        covered by section 18(c) of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 416(c)).
    ``(f) Implementation of Full FACNET Capability.--(1) An executive 
agency shall be considered to have implemented a full FACNET capability 
if (except in the case of procuring activities (or portions thereof) of 
the executive agency for which the head of the agency determines that 
implementation is not cost effective or practicable) the executive 
agency has implemented all of the FACNET functions described in section 
30(b) of the Office of Federal Procurement Policy Act.
    ``(2) For purposes of paragraph (1), an executive agency may not be 
considered to have implemented a full FACNET capability if--
            ``(A) the head of the executive agency has determined that 
        implementation of FACNET capability is not cost effective or 
        practicable in the case of certain procuring activities (or 
        portions thereof) of the executive agency; and
            ``(B) the percentage of the procurement actions in amounts 
        greater than the micro-purchase threshold executed by the 
        procuring activities (or portions thereof) referred to in 
        subparagraph (A) for the preceding fiscal year is greater than 
        25 percent of the total number of procurement actions in 
        amounts greater than the micro-purchase threshold executed by 
        the executive agency for that year.
    ``(g) Procuring Activities Originally Excluded in Certification.--
(1) If the head of an executive agency, in certifying under subsection 
(c) that the agency has implemented a full FACNET capability, 
determines that such implementation is not cost effective or 
practicable in the case of any procuring activity (or portion thereof) 
of that executive agency, then that certification shall not apply under 
section 4A(b) of the Office of Federal Procurement Policy Act to any 
procurement action by that procuring activity (or portion thereof).
    ``(2) If the head of an executive agency determines that an interim 
or a full FACNET capability has subsequently been implemented for that 
procuring activity (or portion thereof), the executive agency shall 
make a certification to the Administrator for Federal Procurement 
Policy in the same manner as a certification under paragraph (1) or (2) 
of subsection (c), as applicable, and such certification shall have the 
same effect with respect to that procuring activity (or portion 
thereof) as if made under such paragraph of subsection (c).''.

                 PART II--SIMPLIFICATION OF PROCEDURES

SEC. 4011. PROCEDURES FOR PURCHASES BELOW MICRO-PURCHASE THRESHOLD.

    The Office of Federal Procurement Policy Act (41 U.S.C. 401 et 
seq.), as amended by section 4001, is further amended by inserting 
after section 4A the following new section:

``SEC. 4B. PROCEDURES APPLICABLE TO PURCHASES BELOW MICRO-PURCHASE 
              THRESHOLD.

    ``(a) Requirements.--(1) The head of each executive agency shall 
ensure that procuring activities of that agency, in awarding a contract 
with a price exceeding the micro-purchase threshold, comply with the 
requirements of section 8(a) of the Small Business Act (15 U.S.C. 
637(a)) and section 2323 of title 10, United States Code, or section 
315 of the Federal Property and Administrative Services Act of 1949, as 
applicable to that agency.
    ``(2) The authority under part 13.106(a)(1) of the Federal 
Acquisition Regulation (48 C.F.R. 13.106(a)(1)), as in effect on 
November 18, 1993, to make purchases without securing competitive 
quotations does not apply to any purchases with a price exceeding the 
micro-purchase threshold.
    ``(b) Exclusion for Micro-Purchases.--A purchase by an executive 
agency with an anticipated value of the micro-purchase threshold or 
less is not subject to the Act of March 3, 1933, commonly referred to 
as the `Buy American Act' (41 U.S.C. 10a-10c).
    ``(c) Applicability of Certain Provisions.--For purposes of section 
27, only subsections (a) and (b) shall apply with respect to purchases 
below the micro-purchase threshold. In applying such subsection (a), a 
contractor that enters into a contract under the micro-purchase 
threshold shall be considered to be a competing contractor. In applying 
such subsection (b), a civil officer or employee, and any member of the 
Armed Forces, who has authority to enter into contracts but whose 
contracting authority is limited to the amount of the micro-purchase 
threshold or less shall be considered to be a procurement official.
    ``(d) Implementation Through FAR.--This section shall be 
implemented through the Federal Acquisition Regulation.
    ``(e) Micro-Purchase Threshold Defined.--For purposes of this 
section, the micro-purchase threshold is the amount of $2,500, adjusted 
on October 1 of each year divisible by 5 to the equivalent amount in 
constant fiscal year 1993 dollars (rounded to the nearest $100).''.

SEC. 4012. PROCUREMENT NOTICE.

    (a) Continuation of Existing Notice Thresholds.--Subsection (a) of 
section 18 of the Office of Federal Procurement Policy Act (41 U.S.C. 
416) is amended as follows:
            (1) Paragraph (1) is amended--
                    (A) by striking out ``the small purchase 
                threshold'' each place it appears and inserting in lieu 
                thereof ``the simplified acquisition threshold'';
                    (B) by striking out ``(c)--'' in the matter 
                preceding subparagraph (A) and inserting in lieu 
                thereof ``(c):'';
                    (C) by striking out ``an executive'' at the 
                beginning of subparagraphs (A) and (C) and inserting in 
                lieu thereof ``An executive'';
                    (D) by striking out the semicolon at the end of 
                subparagraph (A) and inserting in lieu thereof a 
                period; and
                    (E) by amending subparagraph (B) to read as 
                follows:
            ``(B) An executive agency intending to solicit bids or 
        proposals for a contract for property or services for a price 
        expected to exceed $10,000 but not to exceed the simplified 
        acquisition threshold shall post a notice of solicitation 
        described in subsection (b). The notice shall be posted at the 
        contracting office issuing the solicitation or shall be made 
        available through an electronic system with a FACNET capability 
        that at least meets the requirements of paragraphs (1)(A) and 
        (2)(A) of section 30(b). The notice shall be posted for a 
        period of not less than 10 days, except that in the case of a 
        posting made through an electronic system with such a FACNET 
        capability, the posting may be for a period of less than 10 
        days as prescribed in the Federal Acquisition Regulation.''.
            (2) Paragraph (3)(B) is amended by inserting after ``(B)'' 
        the following: ``in the case of a contract or order for an 
        amount expected to exceed the simplified acquisition 
        threshold,''.
    (b) Opportunity for All Responsible Potential Offerors.--Such 
subsection is further amended by adding at the end the following:
    ``(4) An executive agency intending to solicit offers for a 
contract for which a notice of solicitation is required to be posted 
under paragraph (1)(B) shall ensure that all potential offerors are 
permitted to respond to the solicitation for the contract within the 
period of time specified in the solicitation for the submission of 
offers.''.
    (c) Establishment of Deadline for Submission of Offers.--Such 
subsection is further amended by adding after paragraph (4), as added 
by subsection (b), the following new paragraph:
    ``(5) An executive agency shall establish a deadline for the 
submission of all bids or proposals in response to a notice of 
solicitation with respect to which no such deadline is provided by 
statute.''.
    (d) Exceptions.--Subsection (c) of such section is amended by 
adding at the end the following new paragraph:
    ``(4)(A) The requirements of subsection (a)(1) shall not apply in 
the case of an acquisition for which notice is accomplished through the 
use of FACNET, as described in section 30 and certified under section 
2302a of title 10, United States Code, or section 302A of the Federal 
Property and Administrative Services Act of 1949.
    ``(B) The Federal Acquisition Regulation shall provide for minimum 
periods of time for submission of offers for acquisitions described in 
subparagraph (A). Such periods shall provide offerors a reasonable 
opportunity to respond.
    ``(C) A notice of solicitation of bids or proposals for an 
acquisition described in subparagraph (A) shall include the matter 
described in subsection (b).''.

SEC. 4013. GAO TEST AND REPORT ON PERFORMANCE OF SIMPLIFIED ACQUISITION 
              THRESHOLD.

    (a) Performance Test.--The Comptroller General of the United States 
shall collect data and assess the effects of the simplified acquisition 
threshold, as established in section 4A of the Office of Federal 
Procurement Policy Act, on the participation of small business concerns 
(including small business concerns owned and controlled by socially and 
economically disadvantaged individuals) in procurement awards of less 
than $100,000 and the benefits and detriments, if any, to the procuring 
activities of the various Executive agencies.
    (b) Data To Be Collected.--Data collected under subsection (a) 
shall include data regarding whether the establishment of the 
simplified acquisition threshold has improved the acquisition process 
in terms of reduced paperwork, financial or other savings to the 
Federal Government, and any increase in the number of contractors 
participating in the contracting process.
    (c) Period.--Data shall be collected for purposes of subsection (a) 
during the period beginning with the first full fiscal year quarter 
after the effective date of the amendments made by section 3001 and 
ending on September 30, 1997.
    (d) Report.--By March 1, 1998, the Comptroller General shall submit 
to Congress a report on the effects of the establishment of the 
simplified acquisition threshold by the amendments made by section 
3001.

  PART III--INAPPLICABILITY OF LAWS TO ACQUISITIONS NOT IN EXCESS OF 
                    SIMPLIFIED ACQUISITION THRESHOLD

                          Subpart A--Generally

SEC. 4021. INAPPLICABILITY OF FUTURE ENACTED PROCUREMENT LAWS TO 
              CONTRACTS NOT EXCEEDING THE SIMPLIFIED ACQUISITION 
              THRESHOLD.

    (a) Armed Services.--Section 2302a of title 10, United States Code, 
as added by section 4003(a), is amended by adding at the end the 
following new subsection:
    ``(b) Construction With Future Enactments.--A provision of law 
enacted after the date of the enactment of the Federal Acquisition 
Improvement Act of 1994 shall not be construed as applicable to 
purchases of property or services by an agency named in section 2303 of 
this title for an amount not in excess of the simplified acquisition 
threshold unless that provision of law specifically refers to this 
section and specifically states that such provision of law modifies or 
supersedes this section.''.
    (b) Civilian Agencies.--Section 302A of the Federal Property and 
Administrative Services Act of 1949, as added by section 4004(a), is 
amended by adding at the end the following new subsection:
    ``(b) Construction With Future Enactments.--A provision of law 
enacted after the date of the enactment of the Federal Acquisition 
Improvement Act of 1994 shall not be construed as applicable to 
purchases of property or services by an executive agency for an amount 
not in excess of the simplified acquisition threshold unless that 
provision of law specifically refers to this section and specifically 
states that such provision of law modifies or supersedes this 
section.''.

                 Subpart B--Armed Services Acquisitions

SEC. 4031. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

    Section 2302a of title 10, United States Code, as amended by 
section 4021, is further amended by adding at the end the following new 
subsection:
    ``(c) Inapplicability of Certain Provisions of Law.--The following 
provisions of law (and regulations prescribed under such provisions) 
shall not apply to any contract in an amount not greater than the 
simplified acquisition threshold:
            ``(1) Section 2306(b) of this title (relating to 
        prohibition on contingent fees).
            ``(2) Section 2313 of this title (relating to examination 
        of books and records of contractor).
            ``(3) Section 2384(b) of this title (relating to 
        requirement to identify suppliers and sources of supplies).
            ``(4) Section 2393(d) of this title (relating to 
        prohibition against doing business with certain offerors of 
        contractors).
            ``(5) Section 2402 of this title (relating to prohibition 
        on limitation of subcontractor direct sales).
            ``(6) Section 2408(a) of this title (relating to 
        prohibition on persons convicted of defense-contract related 
        felonies).
            ``(7) Section 2410b of this title (relating to contractor 
        inventory accounting system standards).
            ``(8) Section 2534 of this title (relating to miscellaneous 
        limitations on procurement).
            ``(9) Section 27(e) of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 423(e)).
            ``(10) The Drug-Free Workplace Act of 1988 (subtitle D of 
        title V of Public Law 100-690; 41 U.S.C. 701 et seq.).''.

SEC. 4032. CONFORMING AMENDMENTS RELATING TO INAPPLICABILITY OF CERTAIN 
              PROVISIONS OF LAW.

    (a) Inapplicability of Requirement for Contract Clause Regarding 
Contingent Fees.--Section 2306(b) of title 10, United States Code, is 
amended by adding at the end the following: ``This subsection does not 
apply to a contract that is for an amount not in excess of the 
simplified acquisition threshold.''.
    (b) Inapplicability of Authority To Examine Books and Records of 
Contractors.--Section 2313 of title 10, United States Code, as amended 
by section 2201, is further amended by adding at the end of subsection 
(e) the following:
            ``(2) A contract that is for an amount not in excess of the 
        simplified acquisition threshold.''.
    (c) Inapplicability of Requirement To Identify Suppliers and 
Sources of Supplies.--Section 2384(b) of title 10, United States Code, 
is amended by adding at the end the following new paragraph:
    ``(3) The regulations prescribed pursuant to paragraph (1) do not 
apply to a contract for an amount that does not exceed the simplified 
acquisition threshold.''.
    (d) Inapplicability of Prohibition Against Doing Business with 
Certain Offerors or Contractors.--Section 2393(d) of title 10, United 
States Code, is amended in the second sentence by striking out 
``above'' and all that follows and inserting in lieu thereof ``in 
excess of the simplified acquisition threshold.''.
    (e) Inapplicability of Prohibition on Limiting Subcontractor Direct 
Sales to the United States.--Section 2402 of title 10, United States 
Code, is amended by adding at the end the following new subsection:
    ``(c) This section does not apply to a contract that is for an 
amount not in excess of the simplified acquisition threshold.''.
    (f) Inapplicability of Prohibition on Persons Convicted of Defense-
related Felonies.--Section 2408(a) of title 10, United States Code, is 
amended by adding at the end the following new paragraph:
    ``(4) In this subsection, the term `defense contract' means a 
contract in an amount in excess of the simplified acquisition 
threshold.''.
    (g) Inapplicability of Contractor Inventory Accounting System 
Standards.--Section 2410b of title 10, United States Code, is amended--
            (1) by inserting ``(a)'' before ``The Secretary''; and
            (2) by adding at the end the following:
    ``(b) The regulations prescribed pursuant to subsection (a) shall 
not apply to a contract that is for an amount not in excess of the 
simplified acquisition threshold.''.
    (h) Inapplicability of Miscellaneous Procurement Limitations.--
Section 2534 of title 10, United States Code, is amended by adding at 
the end the following:
    ``(g) Inapplicability to Contracts under Simplified Acquisition 
Threshold.--This section does not apply to a contract for an amount 
that does not exceed the simplified acquisition threshold.''.

                Subpart C--Civilian Agency Acquisitions

SEC. 4041. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

    Section 302A of the Federal Property and Administrative Services 
Act of 1949, as amended by section 4021(b), is further amended by 
adding at the end the following new subsection:
    ``(c) Inapplicability of Certain Provisions of Law.--The following 
provisions of law (and regulations prescribed under such provisions) 
shall not apply to any contract entered into by an executive agency in 
an amount not greater than the simplified acquisition threshold:
            ``(1) Sections 303G, 304(a), and 304C of this Act.
            ``(2) Section 27(e) of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 423(e)).
            ``(3) The Drug-Free Workplace Act of 1988 (subtitle D of 
        title V of Public Law 100-690; 41 U.S.C. 701 et seq.).''.

SEC. 4042. CONFORMING AMENDMENTS RELATING TO INAPPLICABILITY OF CERTAIN 
              PROVISIONS OF LAW.

    (a) Inapplicability of Prohibition on Limiting Subcontractor Direct 
Sales to the United States.--Section 303G of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 253g) is amended by 
adding at the end the following new subsection:
    ``(c) This section does not apply to a contract for an amount that 
is not in excess of the simplified acquisition threshold.''.
    (b) Inapplicability of Requirement for Contract Clause Regarding 
Contingent Fees.--Section 304(a) of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 254(a)) is amended by 
adding at the end the following: ``The preceding sentence does not 
apply to a contract for an amount that is not in excess of the 
simplified acquisition threshold.''.
    (c) Inapplicability of Authority To Examine Books and Records of 
Contractors.--Section 304C of the Federal Property and Administrative 
Services Act of 1949, as added by section 2251(a), is amended by adding 
at the end of subsection (e) the following:
            ``(2) A contract that is for an amount not in excess of the 
        simplified acquisition threshold.''.

                   Subpart D--Acquisitions Generally

SEC. 4051. CONFORMANCE OF CERTAIN PROCUREMENT INTEGRITY REQUIREMENTS.

    Subsection (e)(7)(A) of section 27 of the Office of Federal 
Procurement Policy Act (41 U.S.C. 423) is amended by inserting after 
``$100,000'' the following: ``or the simplified acquisition threshold, 
whichever is greater''.

SEC. 4052. INAPPLICABILITY OF THE DRUG-FREE WORKPLACE ACT OF 1988.

    Section 5152(a)(1) of the Drug-Free Workplace Act of 1988 (subtitle 
D of title V of the Anti-Drug Abuse Act of 1988; Public Law 100-690; 41 
U.S.C. 701(a)(1)) is amended by striking out ``of $25,000 or more from 
any Federal agency'' and inserting in lieu thereof ``in excess of the 
simplified acquisition threshold (as defined in section 4A of such Act) 
by any Federal agency''.

                     PART IV--CONFORMING AMENDMENTS

SEC. 4071. ARMED SERVICES ACQUISITIONS.

    (a) Simplified Acquisition Procedures.--Section 2304(g) of title 
10, United States Code, is amended--
            (1) in paragraph (1), by striking out ``small purchases of 
        property and services'' and inserting in lieu thereof 
        ``purchases of property and services for amounts not in excess 
        of the simplified acquisition threshold'';
            (2) by striking out paragraph (2);
            (3) by redesignating paragraphs (3) and (4) as paragraphs 
        (2) and (3), respectively;
            (4) in paragraph (2), as so redesignated--
                    (A) by striking out ``small purchase threshold'' 
                and inserting in lieu thereof ``simplified acquisition 
                threshold''; and
                    (B) by striking out ``small purchase procedures'' 
                and inserting in lieu thereof ``simplified 
                procedures''; and
            (5) in paragraph (3), as so redesignated, by striking out 
        ``small purchase procedures'' and inserting in lieu thereof 
        ``simplified procedures''.
    (b) Solicitation Content Requirement.--Section 2305(a)(2) of such 
title is amended by striking out ``small purchases)'' in the matter 
preceding subparagraph (A) and inserting in lieu thereof ``a purchase 
for an amount not in excess of the simplified acquisition threshold)''.
    (c) Cost Type Contracts.--Section 2306(e)(2)(A) of such title is 
amended by striking out ``small purchase threshold'' and inserting in 
lieu thereof ``simplified acquisition threshold''.
    (d) Cross Reference Amendment.--Section 9005 of Public Law 102-396 
(10 U.S.C. 2441 note) is amended in the first sentence by striking out 
``small purchases covered by section 2304(g)'' and inserting in lieu 
thereof ``purchases for amounts not in excess of the simplified 
acquisition threshold covered by section 2304(g)''.

SEC. 4072. CIVILIAN AGENCY ACQUISITIONS.

    (a) Simplified Acquisition Procedures.--Section 303(g) of the 
Federal Property and Administrative Services Act of 1949 (41 U.S.C. 
253(g)) is amended--
            (1) in paragraph (1)--
                    (A) by striking out ``small purchases of property 
                and services'' and inserting in lieu thereof 
                ``purchases of property and services for amounts not in 
                excess of the simplified acquisition threshold'', and
                    (B) by striking out ``regulations modified, in 
                accordance with section 2752 of the Competition in 
                Contracting Act of 1984,'' and inserting in lieu 
                thereof ``Federal Acquisition Regulation'';
            (2) by striking out paragraph (2);
            (3) by redesignating paragraphs (3) and (4) as paragraphs 
        (2) and (3), respectively;
            (4) in paragraph (2), as so redesignated--
                    (A) by striking out ``small purchase threshold'' 
                and inserting in lieu thereof ``simplified acquisition 
                threshold''; and
                    (B) by striking out ``small purchase procedures'' 
                and inserting in lieu thereof ``simplified 
                procedures'';
            (5) in paragraph (3), as so redesignated, by striking out 
        ``small purchase procedures'' and inserting in lieu thereof 
        ``the simplified procedures''; and
            (6) by striking out paragraph (5).
    (b) Solicitation Content Requirement.--Section 303A(b) of such Act 
(41 U.S.C. 253a(b)) is amended by striking out ``small purchases)'' in 
the matter preceding paragraph (1) and inserting in lieu thereof ``a 
purchase for an amount not in excess of the simplified acquisition 
threshold)''.
    (c) Cost Type Contracts.--Section 304(b) of such Act (41 U.S.C. 
254(b)) is amended in the third sentence by striking out ``either 
$25,000'' and inserting in lieu thereof ``either the simplified 
acquisition threshold''.

SEC. 4073. OFFICE OF FEDERAL PROCUREMENT POLICY ACT.

    Section 19(a) of the Office of Federal Procurement Policy Act (41 
U.S.C. 417(a)) is amended by striking out ``procurements, other than 
small purchases,'' and inserting in lieu thereof ``procurements for 
amounts in excess of the simplified acquisition threshold''.

                    PART V--REVISION OF REGULATIONS

SEC. 4081. REVISION REQUIRED.

    (a) Federal Acquisition Regulation.--(1) Not later than one year 
after the date of the enactment of this Act, the Federal Acquisition 
Regulatory Council established by section 25(a) of the Office of 
Federal Procurement Policy Act (41 U.S.C. 421(a)) shall--
            (A) review the Federal Acquisition Regulation to identify 
        regulations that are applicable to acquisitions in excess of a 
        specified amount that is less than $100,000 (other than such an 
        amount that is specified by law); and
            (B) amend the regulations so identified to provide that 
        such regulations do not apply to acquisitions that are not in 
        excess of the simplified acquisition threshold.
    (2) Paragraph (1)(B) does not apply in the case of a regulation for 
which such an amendment would not be in the national interest, as 
determined by the Council.
    (b) Supplemental Regulations.--Not later than 90 days after the 
date on which the review required by subsection (a)(1)(A) is completed, 
the head of each executive agency that has issued regulations, 
policies, or procedures referred to in section 25(c)(2) of the Office 
of Federal Procurement Policy Act (41 U.S.C. 421(c)(2)) shall--
            (1) identify any such regulation, policy, or procedure that 
        is applicable to acquisitions in excess of a specified amount 
        that is less than $100,000; and
            (2) pursuant to section 22 of such Act (41 U.S.C. 418b), 
        publish amendments to the regulations so identified to provide 
        that each such regulation, policy, or procedure does not apply 
        to acquisitions that are not in excess of the simplified 
        acquisition threshold.
    (c) Relationship to Other Authority.--None of the amendments to 
regulations made pursuant to subsections (a) and (b) apply to or in any 
way diminish the authority of the civil rights enforcement programs 
enforced by the Department of Labor.
    (d) Definitions.--In this section:
            (1) The term ``simplified acquisition threshold'' has the 
        meaning given such term in section 4A of the Office of Federal 
        Procurement Policy Act, as added by section 4001.
            (2) The term ``executive agency'' has the meaning given 
        such term in section 3(a) of the Federal Property and 
        Administrative Services Act of 1949 (41 U.S.C. 472(b)).

           Subtitle B--Socioeconomic and Small Business Laws

SEC. 4101. SMALL BUSINESS PROVISIONS.

    Section 6(d) of the Office of Federal Procurement Policy Act (41 
U.S.C. 405(d)) is amended--
            (1) by striking out ``and'' at the end of paragraph (7);
            (2) by redesignating paragraph (8) as paragraph (10); and
            (3) by inserting after paragraph (7) the following new 
        paragraphs:
            ``(8) developing policies, in consultation with the 
        Administrator of the Small Business Administration, that ensure 
        that small businesses and small businesses owned and controlled 
        by socially and economically disadvantaged persons are provided 
        with the maximum practicable opportunities to participate in 
        procurements that are conducted for amounts below the 
        simplified acquisition threshold;
            ``(9) developing policies that will promote achievement of 
        goals for participation by small businesses and small 
        businesses owned and controlled by socially and economically 
        disadvantaged individuals;''.

SEC. 4102. PAYMENT PROTECTIONS FOR SUBCONTRACTORS AND SUPPLIERS.

    (a) Regulations.--
            (1) In general.--The Administrator for Federal Procurement 
        Policy shall prescribe in regulations the requirements 
        described in paragraph (2).
            (2) Procedures relating to compliance with payment terms.--
        (A) Under procedures established in the regulations, upon the 
        assertion by a subcontractor or supplier of a contractor 
        performing a Government contract that the subcontractor or 
        supplier has not been paid by the prime contractor in 
        accordance with the payment terms of the subcontract, purchase 
        order, or other agreement with the prime contractor, the 
        contracting officer may determine the following:
                    (i) With respect to a construction contract, 
                whether the contractor has made progress payments to 
                the subcontractor or supplier in compliance with 
                chapter 39 of title 31, United States Code.
                    (ii) With respect to a contract other than a 
                construction contract, whether the contractor has made 
                progress or other payments to the subcontractor or 
                supplier in compliance with the terms of the 
                subcontract, purchase order, or other agreement with 
                the prime contractor.
                    (iii) With respect to either a construction 
                contract or a contract other than a construction 
                contract, whether the contractor has made final payment 
                to the subcontractor or supplier in compliance with the 
                terms of the subcontract, purchase order, or other 
                agreement with the prime contractor.
                    (iv) With respect to either a construction contract 
                or a contract other than a construction contract, 
                whether any certification of payment of the 
                subcontractor or supplier accompanying the contractor's 
                payment request to the Government is accurate.
            (B) If the contracting officer determines that the prime 
        contractor is not in compliance with any matter referred to in 
        clause (i), (ii), or (iii) of subparagraph (A), the contracting 
        officer may, under procedures established in the regulations--
                    (i) encourage the prime contractor to make timely 
                payment to the subcontractor or supplier; or
                    (ii) reduce or suspend progress payments with 
                respect to amounts due to the prime contractor.
            (C) If the contracting officer determines that a 
        certification referred to in clause (iv) of subparagraph (A) is 
        inaccurate in any material respect, the contracting officer 
        shall, under procedures established in the regulations, 
        initiate appropriate administrative or other remedial action.
            (D) This paragraph shall apply with respect to any 
        Government contract, other than a Department of Defense 
        contract, that is in effect on the date of promulgation of the 
        regulations under this subsection or that is awarded after such 
        date.
    (b) Inapplicability to Certain Contracts.--The regulations 
prescribed under this section shall not apply to the following 
contracts:
            (1) A contract that is for an amount not in excess of the 
        simplified acquisition threshold (within the meaning of section 
        4A of the Office of Federal Procurement Policy Act).
            (2) A contract for the acquisition of commercial items (as 
        that term is defined in section 4(12) of the Office of Federal 
        Procurement Policy Act).
    (c) Amendments to Armed Services Provision.--Section 806 of the 
National Defense Authorization Act for Fiscal Years 1992 and 1993 
(Public Law 102-190; 10 U.S.C. 2301 note) is amended by striking out 
subsection (c) and inserting in lieu thereof the following:
    ``(c) Inapplicability to Certain Contracts.--Regulations prescribed 
under this section shall not apply to the following contracts:
            ``(1) A contract that is for an amount not in excess of the 
        simplified acquisition threshold (within the meaning of section 
        4A of the Office of Federal Procurement Policy Act).
            ``(2) A contract for the acquisition of commercial items 
        (as that term is defined in section 2281 of title 10, United 
        States Code).''.

SEC. 4103. EXTENSION OF TEST PROGRAM FOR NEGOTIATION OF COMPREHENSIVE 
              SMALL BUSINESS SUBCONTRACTING PLANS.

    Section 834(e) of the National Defense Authorization Act for Fiscal 
Years 1990 and 1991 (Public Law 101-189; 15 U.S.C. 637 note) is amended 
by striking out ``September 30, 1994.'' in the second sentence and 
inserting in lieu thereof ``September 30, 1997.''.

SEC. 4104. SMALL BUSINESS PROCUREMENT ADVISORY COUNCIL.

    (a) Establishment.--There is hereby established an interagency 
council to be known as the ``Small Business Procurement Advisory 
Council'' (hereinafter in this section referred to as the ``Council'').
    (b) Duties.--The duties of the Council are--
            (1) to serve as a forum for discussion of issues and 
        problems relating to, and ideas for improvement of, small 
        business procurement matters within the Federal Government;
            (2) to provide information to other departments and 
        agencies of the Federal Government about small business 
        procurement; and
            (3) to issue advisory reports to the Office of Federal 
        Procurement Policy and the Small Business Administration on 
        small business procurement matters.
    (c) Membership.--The Council shall be composed of the following 
members:
            (1) The Administrator for Federal Procurement Policy (or 
        the designee of the Administrator).
            (2) The Administrator of the Small Business Administration 
        (or the designee of the Administrator).
            (3) The Director of the Minority Business Development 
        Agency.
            (4) The head of each Office of Small and Disadvantaged 
        Business Utilization in each Federal agency having procurement 
        powers.
    (d) Cochairmen.--The Council shall be cochaired by the 
Administrator for Federal Procurement Policy and the Administrator of 
the Small Business Administration.
    (e) Meetings.--The Council shall meet at the call of the chairmen, 
but not less often than four times a year and once each quarter.
    (f) Director.--The Chief Counsel for Advocacy of the Small Business 
shall serve as the director of the Council. The director may not vote 
on matters before the council except in the case of a tie vote among 
the members. The duties of the director shall be determined by the 
chairmen of the Council. The Chief Counsel for Advocacy shall receive 
no additional pay by reason of the counsel's service as director of the 
Council.
    (g) Annual Report.--(1) Not later than 30 days after the end of 
each fiscal year, the Council shall submit to Congress a report 
detailing the activities of the Council during the preceding fiscal 
year in carrying out this section.

SEC. 4105. MAXIMUM PRACTICABLE OPPORTUNITIES FOR APPRENTICES ON FEDERAL 
              CONSTRUCTION PROJECTS.

    (a) Sense of Congress.--It is the sense of the Congress that--
            (1) contractors performing Federal construction contracts 
        should, to the maximum extent practicable, give preference in 
        the selection of subcontractors to subcontractors participating 
        in apprenticeship programs registered with the Department of 
        Labor or with a State apprenticeship agency recognized by such 
        Department; and
            (2) contractors and subcontractors performing Federal 
        construction contracts should provide maximum practicable 
        opportunities for employment of apprentices who are 
        participating in or who have completed such apprenticeship 
        programs.
    (b) Report.--Not later than 2 years after the date of the enactment 
of this Act, the Comptroller General shall submit to the Congress a 
report on the extent to which contractors and subcontractors performing 
Federal construction contracts have increased subcontractor 
participation in registered apprenticeship programs.

               Subtitle C--Miscellaneous Acquisition Laws

SEC. 4151. RESTRICTION ON USE OF NONCOMPETITIVE PROCEDURES FOR 
              PROCUREMENT FROM A SPECIFIED SOURCE.

    (a) Armed Services Acquisitions.--Section 2304 of title 10, United 
States Code, as amended by section 1005, is further amended--
            (1) in subsection (c)(5), by inserting ``subject to 
        subsection (k),'' after ``(5)''; and
            (2) by adding at the end the following new subsection:
    ``(k)(1) It is the policy of Congress that no legislation should be 
enacted that requires a procurement by an agency to be made from a 
specified non-Federal Government source.
    ``(2) A provision of law may not be construed as requiring a 
procurement by an agency to be made from a specified non-Federal 
Government source unless that provision of law--
            ``(A) specifically refers to this subsection;
            ``(B) specifically identifies the particular non-Federal 
        Government source from which the procurement is to made; and
            ``(C) specifically states that the procurement from that 
        source is required by such provision of law in contravention of 
        the policy set forth in paragraph (1).''.
    (b) Civilian Agency Acquisitions.--Section 303 of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 253) is 
amended--
            (1) in subsection (c)(5), by inserting ``subject to 
        subsection (h),'' after ``(5)''; and
            (2) by adding at the end the following new subsection:
    ``(h)(1) It is the policy of Congress that no legislation should be 
enacted that requires a procurement by an executive agency to be made 
from a specified non-Federal Government source.
    ``(2) A provision of law may not be construed as requiring a 
procurement by an executive agency to be made from a specified non-
Federal Government source unless that provision of law--
            ``(A) specifically refers to this subsection;
            ``(B) specifically identifies the particular non-Federal 
        Government source involved; and
            ``(C) specifically states that the procurement from that 
        source is required by such provision of law in contravention of 
        the policy set forth in paragraph (1).''.

SEC. 4152. REPEAL OF OBSOLETE PROVISION.

    Section 308 of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 258) is repealed.

                     TITLE V--STANDARDS OF CONDUCT

SEC. 5001. CONTRACTING FUNCTIONS PERFORMED BY FEDERAL PERSONNEL.

    (a) Amendment of OFPP Act.--The Office of Federal Procurement 
Policy Act, as amended by section 1091, is further amended by inserting 
after section 22 the following new section 23:

``SEC. 23. CONTRACTING FUNCTIONS PERFORMED BY FEDERAL PERSONNEL.

    ``(a) Limitation on Use of Contract Advisory and Assistance 
Services.--(1) An executive agency may not provide for an evaluation or 
analysis of any aspect of a proposal submitted for an acquisition by 
that executive agency to be conducted by a person who is not an 
employee of an executive agency or a member of the Armed Forces unless 
the executive agency determines that employees or members with adequate 
training and capability to perform the evaluation or analysis are not 
readily available within the agency or another Federal agency, as 
determined in accordance with standards and procedures prescribed in 
the Federal Acquisition Regulation.
    ``(2) In the administration of this subsection, the executive 
agency shall determine in accordance with the standards and procedures 
set forth in the Federal Acquisition Regulation whether--
            ``(A) a sufficient number of employees within the executive 
        agency or another Federal agency are readily available to 
        perform a particular evaluation or analysis for the executive 
        agency making the determination; and
            ``(B) the readily available employees have the training and 
        capabilities necessary to perform the evaluation or analysis.
    ``(b) Definition.--For purposes of this section, the term 
`employee' has the meaning given such term in section 2105 of title 5, 
United States Code.''.
    (b) Requirement for Guidance and Regulations.--
            (1) In general.--The Federal Acquisition Regulatory Council 
        established by section 25(a) of the Office of Federal 
        Procurement Policy Act (41 U.S.C. 421(a)) shall--
                    (A) review part 37 of title 48 of the Code of 
                Federal Regulations as it relates to the use of 
                advisory and assistance services; and
                    (B) provide guidance and promulgate regulations 
                regarding--
                            (i) what actions Federal agencies are 
                        required to take to determine whether expertise 
                        is readily available within the Federal 
                        Government before contracting for advisory and 
                        technical services to conduct acquisitions; and
                            (ii) the manner in which Federal employees 
                        with expertise may be shared with agencies 
                        needing expertise for such acquisitions.
            (2) Definition.--In paragraph (1), the term ``employee'' 
        has the meaning given such term in section 2105 of title 5, 
        United States Code.

SEC. 5002. REPEAL OF EXECUTED REQUIREMENT FOR STUDY AND REPORT.

    Section 17 of the Office of Federal Procurement Policy Act (41 
U.S.C. 415) is repealed.

SEC. 5003. INTERESTS OF MEMBERS OF CONGRESS.

    Section 3741 of the Revised Statutes (41 U.S.C. 22) is amended to 
read as follows:
    ``Sec. 3741. No member of Congress shall be admitted to any share 
or part of any contract or agreement made, entered into, or accepted by 
or on behalf of the United States, or to any benefit to arise 
thereupon.''.

SEC. 5004. WAITING PERIOD FOR SIGNIFICANT CHANGES PROPOSED FOR 
              ACQUISITION REGULATIONS.

    Section 22 of the Office of Federal Procurement Policy Act (41 
U.S.C. 418b) is amended--
            (1) by striking out ``30 days'' in subsection (a) and 
        inserting in lieu thereof ``45 days''; and
            (2) by adding at the end of subsection (d) the following 
        new paragraph:
    ``(3) A policy, regulation, procedure, or form described in 
subsection (a) may (notwithstanding that subsection) take effect 
earlier than 45 days after the date of publication thereof in the 
Federal Register pursuant to subsection (b) if the officer authorized 
to issue the procurement policy, regulation, procedure, or form 
determines that compelling circumstances make compliance with the 45-
day requirement under subsection (a) impracticable. However, the 
policy, regulation, procedure, or form may not take effect earlier than 
30 days after the publication date except as provided in paragraph 
(1).''.

SEC. 5005. REPEAL OF SUPERSEDED AND OBSOLETE LAWS.

    (a) Repeal.--The following sections of title 10, United States 
Code, are repealed: sections 2207, 2397, 2397a, 2397b, and 2397c.
    (b) Clerical Amendments.--
            (1) The table of sections at the beginning of chapter 131 
        of such title is amended by striking out the item relating to 
        section 2207.
            (2) The table of sections at the beginning of chapter 141 
        of such title is amended by striking out the items relating to 
        sections 2397, 2397a, 2397b, and 2397c.

                TITLE VI--DEFENSE TRADE AND COOPERATION

SEC. 6001. EXCEPTION TO BUY AMERICAN ACT FOR MICRO-PURCHASES.

    Section 2 of title III of the Act of March 3, 1933 (41 U.S.C. 10a), 
commonly referred to as the ``Buy American Act'', is amended by adding 
at the end the following: ``This section shall not apply to 
manufactured articles, materials, or supplies procured under any 
contract the award value of which is less than or equal to the micro-
purchase threshold under section 4B of the Office of Federal 
Procurement Policy Act.''.

SEC. 6002. POLICY ON PURCHASE OF FOREIGN GOODS.

    (a) In General.--Section 2533 of title 10, United States Code, is 
amended to read as follows:
``Sec. 2533. Policy on the purchase of foreign goods
    ``(a) Determination under Buy American Act.-- In determining 
whether application of the Buy American Act is inconsistent with the 
public interest, the Secretary of Defense shall give adequate 
consideration to the following:
            ``(1) The bids or proposals of small business firms in the 
        United States which have offered to furnish American goods.
            ``(2) The bids or proposals of all other firms in the 
        United States which have offered to furnish American goods.
            ``(3) The balance of payments of the United States.
            ``(4) The cost of shipping goods which are other than 
        American goods.
            ``(5) Any duty, tariff, or surcharge which may enter into 
        the cost of using goods which are other than American goods.
            ``(6) The need to ensure that the Department of Defense has 
        access to advanced state-of-the-art commercial technology.
            ``(7) The need to protect the national technology and 
        industrial base, to preserve and enhance the national 
        technology employment base, and to provide for a defense 
        mobilization base.
            ``(8) The need to maintain the same source of supply for 
        spare and replacement parts either for an end item that 
        qualifies as an American good or to maintain or foster the 
        integration of the military and commercial industrial base.
            ``(9) National security interests of the United States.
    ``(b) In this section, the term `goods which are other than 
American goods' means--
            ``(1) an end product that is not mined, produced, or 
        manufactured in the United States; or
            ``(2) an end product that is manufactured in the United 
        States but which includes components mined, produced, or 
        manufactured 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.''.
    (b) Clerical Amendment.--The item relating to section 2533 in the 
table of sections at the beginning of subchapter V of chapter 148 of 
such title is amended to read as follows:

``2533. Policy on purchase of foreign goods.''.

SEC. 6003. CONSOLIDATION OF MISCELLANEOUS PROCUREMENT LIMITATIONS.

    Section 2534 of title 10, United States Code, is amended--
            (1) by striking out subsections (a) through (f);
            (2) by redesignating subsection (g), as added by section 
        4032, as subsection (d); and
            (3) by inserting after the section heading the following:
    ``(a) Limitation on Certain Procurements.--The Secretary of Defense 
may procure an item listed in subsection (b) only if the item is 
manufactured by an entity that is part of the national technology and 
industrial base (as defined in section 2491(1) of this title).
    ``(b) Covered Items.--Subsection (a) applies to the following:
            ``(1) Buses.--Multipassenger motor vehicles (buses).
            ``(2) Chemical weapons antidote.--Chemical weapons antidote 
        contained in automatic injectors (or components for such 
        injectors), but only if the company that manufactures the item 
        not only manufactures it in the United States but also meets 
        the following requirements:
                    ``(A) The company is an existing producer under the 
                industrial preparedness program at the time the 
                contract is awarded.
                    ``(B) The company has received all required 
                regulatory approvals.
                    ``(C) The company has the plant, equipment, and 
                personnel to perform the contract in existence in the 
                United States at the time the contract is awarded.
            ``(3) Valves and machine tools.--(A) Items in the following 
        categories:
                    ``(i) Powered and non-powered valves in Federal 
                Supply Classes 4810 and 4820 used in piping for naval 
                surface ships and submarines.
                    ``(ii) Machine tools in the Federal Supply Classes 
                for metal-working machinery numbered 3405, 3408, 3410 
                through 3419, 3426, 3433, 3438, 3441 through 3443, 
                3445, 3446, 3448, 3449, 3460, and 3461.
            ``(B) Contracts for the procurement of items described in 
        subparagraph (A) include contracts--
                    ``(i) for the use of such items in any property 
                under the control of the Department of Defense, 
                including Government-owned, contractor-operated 
                facilities; and
                    ``(ii) entered into by contractors on behalf of the 
                Department of Defense for the purposes of providing 
                such items to other contractors as Government-furnished 
                equipment.
            ``(C) In any case in which a contract for items described 
        in subparagraph (A) includes the procurement of more than one 
        Federal Supply Class of machine tools or machine tools and 
        accessories, each supply class shall be evaluated separately 
        for purposes of determining whether the limitation in this 
        subsection applies.
            ``(D) This paragraph is effective through fiscal year 1996.
            ``(4) Air circuit breakers.--Air circuit breakers for naval 
        vessels.
            ``(5) Sonobuoys.--Sonobuoys.
            ``(6) Ball bearings and roller bearings.--Ball bearings and 
        roller bearings, in accordance with subpart 225.71 of part 225 
        of the Defense Federal Acquisition Regulation Supplement, as in 
        effect on October 23, 1992. This paragraph is effective through 
        fiscal year 1995.
    ``(c) Exceptions.--The Secretary of Defense may waive the 
limitation in subsection (a) with respect to the procurement of an item 
listed in subsection (b) if the Secretary determines that any of the 
following apply:
            ``(1) Application of the limitation would cause 
        unreasonable costs or delays to be incurred.
            ``(2) United States producers of the item would not be 
        jeopardized by competition from a foreign country and that 
        country does not discriminate against defense items produced in 
        the United States to a greater degree than the United States 
        discriminates against defense items produced in that country.
            ``(3) Application of the limitation would impede 
        cooperative programs entered into between the Department of 
        Defense and a foreign country and that country does not 
        discriminate against defense items produced in the United 
        States to a greater degree than the United States discriminates 
        against defense items produced in that country.
            ``(4) Satisfactory quality items manufactured by an entity 
        that is part of the national technology and industrial base (as 
        defined in section 2491(1) of this title) are not available.
            ``(5) Application of the limitation would result in the 
        existence of only one source for the item that is an entity 
        that is part of the national technology and industrial base (as 
        defined in section 2491(1) of this title).
            ``(6) The procurement is for an amount less than the 
        simplified acquisition threshold and simplified purchase 
        procedures are being used.
            ``(7) Application of the limitation is not in the national 
        security interests of the United States.
            ``(8) Application of the limitation would adversely affect 
        a United States company.
    ``(d) Principle of Construction with Future Laws.--A provision of 
law may not be construed as modifying or superseding the provisions of 
this section, or as requiring funds to be limited, or made available, 
by the Secretary of Defense to a particular domestic source by 
contract, unless that provision of law--
            ``(1) specifically refers to this section;
            ``(2) specifically states that such provision of law 
        modifies or supersedes the provisions of this section; and
            ``(3) specifically identifies the particular domestic 
        source involved and states that the contract to be awarded 
        pursuant to such provision of law is being awarded in 
        contravention of this section.''.

SEC. 6004. REPEAL OF OBSOLETE AND REDUNDANT PROVISIONS.

    (a) Repeal of Requirement for Policy Guidance.--Title III of the 
Act of March 3, 1933 (41 U.S.C. 10a et seq.), commonly referred to as 
the ``Buy American Act'', is amended in section 4(g) (41 U.S.C. 10b-
1(g)) by striking out paragraphs (2)(C) and (3).
    (b) Repeal of Reporting Requirement.--Section 9096(b) of Public Law 
102-396 (106 Stat. 1924; 41 U.S.C. 10b-2(b)) is repealed.
    (c) Repeal of Studies of Waivers.--Section 306 of the Trade 
Agreements Act of 1979 (19 U.S.C. 2516), relating to studies of certain 
employment effects and procurement effects of a waiver of the Buy 
American Act, is repealed.

                      TITLE VII--COMMERCIAL ITEMS

                Subtitle A--Definitions and Regulations

SEC. 7001. DEFINITIONS.

    (a) Definitions.--Section 4 of the Office of Federal Procurement 
Policy Act (41 U.S.C. 403) is amended by adding at the end the 
following new paragraphs:
            ``(12) The term `commercial item' means any of the 
        following:
                    ``(A) Any item of a type customarily used in the 
                course of normal business operations for other than 
                Federal Government purposes, that--
                            ``(i) has been sold, leased, or licensed to 
                        the general public or to domestic State, or 
                        local government entities; or
                            ``(ii) has been offered for sale, lease, or 
                        license to the general public or to domestic 
                        State, or local government entities.
                    ``(B) An item intended to be used in the course of 
                normal business operations for other than Federal 
                Government purposes that is not yet available in the 
                commercial marketplace, but will be available in the 
                commercial marketplace in time to satisfy the delivery 
                requirements under a Federal Government solicitation.
                    ``(C) Any item that, but for--
                            ``(i) modifications of a type customarily 
                        available in the commercial marketplace, or
                            ``(ii) minor modifications made to meet 
                        Federal Government requirements,
                would satisfy the criteria in subparagraph (A) or (B).
                    ``(D) Any combination of items meeting the 
                requirements of subparagraph (A), (B), or (C) that are 
                of a type customarily combined and sold in combination 
                to the general public.
                    ``(E) Installation services, maintenance services, 
                repair services, training services, and other services 
                if such services are procured for support of an item 
                referred to in subparagraph (A), (B), (C), or (D) and 
                if the source of such services--
                            ``(i) offers such services to the general 
                        public and the Federal Government 
                        contemporaneously and under similar terms and 
                        conditions; and
                            ``(ii) offers to use the same work force 
                        for providing the Federal Government with such 
                        services as the source uses for providing such 
                        services to the general public.
                    ``(F) Services offered and sold competitively, in 
                significant quantities, in the commercial marketplace 
                at established catalog prices or standard rates and 
                under standard commercial terms and conditions.
                    ``(G) Any item, combination of items, or service 
                referred to in subparagraphs (A) through (F) 
                notwithstanding the fact that the item, combination of 
                items, or service is transferred between or among 
                separate divisions, subsidiaries, or affiliates of a 
                contractor.
            ``(13) The term `nondevelopmental item' means any of the 
        following:
                    ``(A) Any previously developed item of supply that 
                is in use by a department or agency of the United 
                States, a State or local government, or a foreign 
                government with which the United States has a mutual 
                defense cooperation agreement.
                    ``(B) Any item of supply described in subparagraph 
                (A) that requires only minor modification or 
                modification of the type customarily available in the 
                commercial marketplace in order to meet the 
                requirements of the procuring department or agency.
                    ``(C) Any item of supply currently being produced 
                that does not meet the requirements of subparagraph (A) 
                or (B) solely because the item is not yet in use.
            ``(14) The term `component' means any item supplied to the 
        Federal Government as part of an end item or of another 
        component.
            ``(15) The term `commercial component' means any component 
        that is a commercial item.''.
    (b) Stylistic Amendments.--Such section is further amended--
            (1) by striking out ``Act--'' in the matter preceding 
        paragraph (1) and inserting in lieu thereof ``Act:'';
            (2) by capitalizing the first letter of the first word in 
        each of paragraphs (1) through (11);
            (3) by striking out the semicolon at the end of each of 
        paragraphs (1), (2), (3), (5), (6), (7), (8), and (9) and 
        inserting in lieu thereof a period; and
            (4) by striking out ``; and'' at the end of paragraphs (4) 
        and (10) and inserting in lieu thereof a period.

SEC. 7002. REGULATIONS ON ACQUISITION OF COMMERCIAL ITEMS.

    (a) In General.--The Federal Acquisition Regulation shall provide 
regulations to implement paragraphs (12) through (15) of section 4 of 
the Office of Federal Procurement Policy Act, chapter 136 of title 10, 
United States Code, and sections 314 through 314D of the Federal 
Property and Administrative Services Act of 1949.
    (b) Terms and Conditions.--The regulations prescribed under 
subsection (a) shall contain a set or sets of terms and conditions to 
be included in contracts for the acquisition of commercial end items. 
Such terms and conditions shall, to the maximum extent practicable, 
include only those contract clauses that are--
            (1) required to implement provisions of law applicable to 
        commercial item acquisitions; or
            (2) consistent with standard commercial practice.
    (c) Terms and Conditions for Components.--Such regulations shall 
provide that a prime contractor furnishing commercial items or items 
other than commercial items as items or components shall not be 
required to apply to any of its divisions, subsidiaries, affiliates, 
subcontractors, or suppliers that are furnishing commercial items as 
components any clause, term, or condition except those that are--
            (1) required to implement provisions of law applicable to 
        subcontractors furnishing commercial items; or
            (2) determined to be consistent with standard commercial 
        practice.
    (d) Market Acceptance.--The regulations prescribed under subsection 
(a) shall provide that, under appropriate conditions, the agency head 
may require an offeror to demonstrate, as a condition for being 
considered responsive, that the items offered meet, among other 
criteria, market acceptance criteria, unless such item has been 
satisfactorily supplied to an executive agency under current or recent 
contracts for the same or similar requirements.
    (e) Use of Fixed Price Contracts.--The regulations prescribed under 
subsection (a) shall include a requirement that firm, fixed price 
contracts, or fixed price contracts with economic price adjustment 
provisions, be used for the acquisition of commercial items and 
components.
    (f) Term of Contracts.--The regulations prescribed under subsection 
(a) shall provide that, to the extent practicable, contracts for 
acquisition of commercial items shall not require contract performance 
for a term longer than customary industry practice for the item being 
acquired. A contracting officer may include in a contract provisions 
for economic price adjustment if an extended period of performance 
under the contract cannot be avoided.
    (g) Contract Quality Requirements.--The regulations prescribed 
under subsection (a) shall include provisions that--
            (1) permit, to the maximum extent practicable, a contractor 
        under a commercial items acquisition to use the existing 
        quality assurance system of the contractor as a substitute for 
        compliance with an otherwise applicable requirement for the 
        Government to inspect or test the commercial items before the 
        contractor's tender of those items for acceptance by the 
        Government;
            (2) require that, to the maximum extent practicable, the 
        executive agency take advantage of warranties (including 
        extended warranties) offered by offerors of commercial items 
        and use such warranties for the repair and replacement of 
        commercial items; and
            (3) set forth guidance regarding the use of past 
        performance of commercial items and sources as a factor in 
        contract award decisions.
    (h) Defense Contract Clauses.--
            (1) Repeal of dod authority.--Section 824(b) of the 
        National Defense Authorization Act for Fiscal Years 1990 and 
        1991 (Public Law 101-189; 10 U.S.C. 2325 note) is repealed.
            (2) Savings provision.--Notwithstanding subsections (b) and 
        (c), a contract of the Department of Defense entered into 
        before October 1, 1994, and a subcontract entered into before 
        such date under such a contract, may include clauses developed 
        pursuant to paragraphs (2) and (3) of section 824(b) of the 
        National Defense Authorization Act for Fiscal Years 1990 and 
        1991 (Public Law 101-189; 10 U.S.C. 2325 note).

                Subtitle B--Armed Services Acquisitions

SEC. 7101. ESTABLISHMENT OF NEW CHAPTER IN TITLE 10.

    (a) Establishment.--Part IV of subtitle A of title 10, United 
States Code, is amended by inserting before chapter 137 the following 
new chapter 136:

             ``CHAPTER 136--PROCUREMENT OF COMMERCIAL ITEMS

``Sec.
``2281. Definitions.
``2282. Preference for acquisition of commercial items.
``2283. Exception to cost or pricing data requirement for commercial 
                            items.
``2284. Principle of construction with future laws.
``2285. Inapplicability of certain provisions of law.''.
    (b) Clerical Amendment.--The tables of chapters at the beginning of 
subtitle A of title 10, United States Code, and the beginning of part 
IV of such subtitle are amended by inserting before the item relating 
to chapter 137 the following new item:

``136. Procurement of Commercial Items......................    2281''.

SEC. 7102. DEFINITIONS.

    Chapter 136 of title 10, United States Code, as added by section 
7001, is amended by adding after the table of sections the following:
``Sec. 2281. Definitions
    ``In this chapter:
            ``(1) The terms `commercial item', `nondevelopmental item', 
        `component', and `commercial component' have the meanings 
        provided in section 4 of the Office of Federal Procurement 
        Policy Act.
            ``(2) The term `head of an agency' means the Secretary of 
        Defense, the Secretary of Transportation, and the Administrator 
        of the National Aeronautics and Space Administration.
            ``(3) The term `agency' means the Department of Defense, 
        the Coast Guard, and the National Aeronautics and Space 
        Administration.''.

SEC. 7103. PREFERENCE FOR ACQUISITION OF COMMERCIAL ITEMS.

    (a) In General.--Chapter 136 of title 10, United States Code, as 
amended by section 7102, is further amended by adding after section 
2281 the following new section:
``Sec. 2282. Preference for acquisition of commercial items
    ``(a) Preference.--The head of an agency shall ensure that, to the 
maximum extent practicable--
            ``(1) requirements of the agency with respect to a 
        procurement of supplies or services are stated in terms of--
                    ``(A) functions to be performed;
                    ``(B) performance required; or
                    ``(C) essential physical characteristics;
            ``(2) such requirements are defined so that commercial 
        items may be procured to fulfill such requirements; and
            ``(3) such requirements are fulfilled through the 
        procurement of commercial items.
    ``(b) Implementation.--The head of an agency shall ensure that 
procurement officials in that agency, to the maximum extent 
practicable--
            ``(1) acquire commercial items to meet the needs of the 
        agency;
            ``(2) require prime contractors and subcontractors at all 
        levels under the agency contracts to incorporate commercial 
        items as components of items supplied to the agency;
            ``(3) modify requirements in appropriate cases to ensure 
        that the requirements can be met by commercial items;
            ``(4) state specifications in terms that enable and 
        encourage bidders and offerors to supply commercial items;
            ``(5) revise the agency's procurement policies, practices, 
        and procedures not required by law to reduce any impediments in 
        those policies, practices, and procedures to the acquisition of 
        commercial items; and
            ``(6) require training of appropriate personnel in the 
        acquisition of commercial items.
    ``(c) Existing or Prior Sources of Nondevelopmental Items.--(1) 
Notwithstanding subsection (a), an agency may, until five years after 
the date of the enactment of the Federal Acquisition Improvement Act of 
1994, determine that it is in the Government's interests to permit 
existing or prior sources of nondevelopmental items to participate in a 
competition for a commercial item in a case in which a nondevelopmental 
item will compete with a commercial item under the same terms, 
conditions, and evaluation and award criteria.
    ``(2) Nondevelopmental items furnished by an existing or prior 
source that must be modified to meet the requirements of a solicitation 
for commercial items may be offered under such a solicitation, but only 
in a case in which the modifications--
            ``(A) are necessary to comply with the Government's 
        solicitation requirements; and
            ``(B) do not significantly alter the function or essential 
        physical characteristics of the items to be supplied.
    ``(3) The policies, procedures, solicitation provisions, and 
contract clauses applicable to commercial items under this chapter also 
shall apply to nondevelopmental items furnished by an existing or prior 
source that is permitted to participate in a competition conducted 
under this title.
    ``(d) Preliminary Market Research.--(1) The head of an agency shall 
conduct market research appropriate to the circumstances--
            ``(A) before developing new specifications for a 
        procurement by that agency; and
            ``(B) before soliciting bids or proposals for a contract in 
        excess of the simplified acquisition threshold.
    ``(2) The head of an agency shall use the results of market 
research to determine whether there are commercial items available 
that--
            ``(A) meet the agency's requirements;
            ``(B) could be modified to meet the agency's requirements; 
        or
            ``(C) could meet the agency's requirements if those 
        requirements were modified to a reasonable extent.''.
    (b) Repeal of Superseded Provision.--Section 2325 of title 10, 
United States Code, is repealed. The table of sections at the beginning 
of chapter 137 of such title is amended by striking out the item 
relating to section 2325.

SEC. 7104. EXCEPTION TO COST OR PRICING DATA REQUIREMENTS FOR 
              COMMERCIAL ITEMS.

    (a) In General.--Chapter 136 of title 10, United States Code, as 
amended by section 7103, is further amended by adding after section 
2282 the following new section:
``Sec. 2283. Exception to cost or pricing data requirements for 
              commercial items
    ``(a) Exemption From Section 2306a If Price Based on Adequate Price 
Competition or Established Prices.--In any procurement of a commercial 
item, when the agreed-upon price of the commercial item is based on 
adequate price competition or on established catalog or market prices 
of items sold in sufficient quantities to the general public--
            ``(1) the procurement shall be exempt from section 2306a of 
        this title; and
            ``(2) to the maximum extent practicable, the head of the 
        agency conducting the procurement may not require any 
        additional information from the offeror to determine price 
        reasonableness.
    ``(b) Requirement To Determine Price Reasonableness For 
Noncompetitive Procurements.--In any case in which it is not 
practicable to conduct a procurement of a commercial item on a 
competitive basis and the procurement is not covered by subsection (a) 
or by an exception in subsection (b) of section 2306a of this title, 
the contracting officer shall use price analysis to determine whether 
the price of the contract is fair and reasonable. If the contracting 
officer is able to determine through price analysis that the price is 
reasonable, the procurement shall be exempt from section 2306a of this 
title. Price analysis under this subsection shall be conducted by 
developing or obtaining from the offeror or contractor, or from another 
source or sources, in accordance with standards and procedures set 
forth in Federal Acquisition Regulations, information on prices at 
which the same or similar items have been sold in the commercial market 
that is adequate for evaluating the reasonableness of the price of the 
contract.
    ``(c) Authority To Request Cost or Pricing Data When Price 
Reasonableness Cannot Be Determined.--In any case in which a 
contracting officer is unable to determine under subsection (b) that a 
price is reasonable, the contracting officer, with the prior approval 
of the head of the procuring activity, may require cost or pricing data 
under section 2306a of this title.
    ``(d) Right To Audit.--(1) The head of an agency is authorized to 
audit all documentation provided by an offeror under subsection (b) or 
(c) and all books and records of the offeror directly relating to such 
documentation, except that, if the offeror has made no representation 
as to the completeness of the documentation supplied, the head of the 
agency is not authorized to audit for completeness.
    ``(2) The authority under this subsection shall expire--
            ``(A) one year after the date of commencement of 
        performance of the contract, or one year after the date of 
        commencement of performance of the modification of the 
        contract, with respect to which the information was provided; 
        or
            ``(B) on such other date agreed upon by the parties at the 
        time of contract award or contract definitization.
    ``(e) Limitations on Requests for Data.--The Federal Acquisition 
Regulation shall establish reasonable limitations on requests under 
this section for sales data relating to commercial items.
    ``(f) Form of Information.--In conducting a price analysis, or in 
requiring any additional information from an offeror, a contracting 
officer may request only that information from an offeror that is in 
the form regularly maintained by the offeror in commercial operations, 
adequate to demonstrate the market price of the item or items, or 
otherwise needed to establish a fair and reasonable price.
    ``(g) Confidentiality.--All documentation received from an offeror, 
if not otherwise in the public domain and if requested by the offeror 
and marked as proprietary, shall be treated by the Government as 
confidential and exempt from disclosure to the extent permitted by 
section 552 of title 5.''.
    (b) Cross Reference.--Section 2306a of title 10, United States 
Code, is amended by adding at the end the following new subsection:
    ``(h) Exceptions Regarding Commercial Items.--For provisions 
relating to exceptions for procurements of commercial items, see 
section 2283 of this title.''.

SEC. 7105. PRINCIPLE OF CONSTRUCTION WITH FUTURE LAWS.

    Chapter 136 of title 10, United States Code, as amended by section 
7104, is further amended by adding after section 2283 the following new 
section:
``Sec. 2284. Principle of construction with future laws
    ``A provision of law enacted after the date of the enactment of the 
Federal Acquisition Improvement Act of 1994 may not be construed as 
applicable to purchases of commercial items by an agency unless that 
provision of law specifically refers to this section and specifically 
states that such provision of law modifies or supersedes a provision of 
this chapter.

SEC. 7106. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

    (a) Inapplicable Provisions.--Chapter 136 of title 10, United 
States Code, as amended by section 7105, is further amended by adding 
after section 2284 the following new section:
``Sec. 2285. Inapplicability of certain provisions of law
    ``(a) Provisions Inapplicable to Prime Contractors.--The following 
provisions of law (and regulations prescribed under such provisions) 
shall not apply to any contract entered into by an agency for the 
procurement of a commercial item:
            ``(1) Section 2306(b) of this title (relating to 
        prohibition on contingent fees).
            ``(2) Section 2320 of this title (relating to rights in 
        technical data).
            ``(3) Section 2321 of this title (relating to validation of 
        proprietary data restrictions).
            ``(4) Section 2324 of this title (relating to allowable 
        costs).
            ``(5) Section 2384(b) of this title (relating to 
        requirement to identify suppliers and sources of supplies).
            ``(6) Section 2393(d) of this title (relating to 
        prohibition against doing business with certain offerors or 
        contractors).
            ``(7) Section 2402 of this title (relating to prohibition 
        on limitation of subcontractor direct sales).
            ``(8) Section 2408(a) of this title (relating to 
        prohibition on persons convicted of defense contract-related 
        felonies).
            ``(9) Section 2410b of this title (relating to contractor 
        inventory accounting system standards).
            ``(10) Section 843 of Public Law 103-160 (107 Stat. 1720) 
        (relating to reports of defense contractors of dealings with 
        terrorist countries).
            ``(11) Section 26 of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 422) (relating to cost accounting 
        standards board).
            ``(12) Section 27(e) of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 423(e)) (relating to procurement 
        integrity).
            ``(13) The Drug-Free Workplace Act of 1988 (subtitle D of 
        title V of Public Law 100-690; 41 U.S.C. 701 et seq.).
    ``(b) Provisions Inapplicable to Subcontractors and Other 
Entities.--
            ``(1) Laws inapplicable.--The following provisions of law 
        (and regulations prescribed under such provisions) shall not 
        apply to any entity described in paragraph (2):
                    ``(A) Each provision of law listed under subsection 
                (a).
                    ``(B) Section 2534 of this title (relating to 
                miscellaneous limitations on procurement).
            ``(2) Covered entities.--Paragraph (1) applies to each of 
        the following:
                    ``(A) Any division, subsidiary, or affiliate of a 
                prime contractor (other than the division, subsidiary, 
                or affiliate that is contracting with the Government 
                under the prime contract) or of a subcontractor of a 
                prime contractor, if such division, subsidiary, or 
                affiliate is furnishing a commercial item to the prime 
                contractor or subcontractor for purposes of carrying 
                out the prime contract or subcontract.
                    ``(B) Any subcontractor or supplier of a prime 
                contractor, if the subcontractor or supplier is 
                furnishing a commercial item to the prime contractor 
                for purposes of carrying out the prime contract.''.

SEC. 7107. CONFORMING AMENDMENTS RELATING TO INAPPLICABILITY OF CERTAIN 
              PROVISIONS OF LAW.

    (a) Inapplicability of Requirement for Contract Clause Regarding 
Contingent Fees.--Section 2306(b) of title 10, United States Code, as 
amended by section 4032(a), is further amended by inserting before the 
period at the end of the sentence added by that section the following: 
``or to a contract for the acquisition of commercial items''.
    (b) Inapplicability of Regulations on Rights in Technical Data.--
Section 2320 of title 10, United States Code, is amended by adding at 
the end the following new subsection:
    ``(e) The regulations prescribed under subsection (a) shall not 
apply to contracts for the purchase of commercial items.''.
    (c) Inapplicability of Requirement for Validation of Proprietary 
Data Restrictions.--Section 2321(a) of title 10, United States Code, is 
amended by inserting before the period at the end the following: ``, 
other than a contract for supplies or services that are commercial 
items''.
    (d) Inapplicability of Requirement To Identify Suppliers and 
Sources of Supplies.--Paragraph (2) of section 2384(b) of title 10, 
United States Code, is amended to read as follows:
    ``(2) The regulations prescribed pursuant to paragraph (1) do not 
apply to a contract that requires the delivery of supplies that are 
commercial items.''.
    (e) Inapplicability of Prohibition Against Doing Business with 
Certain Offerors or Contractors.--Section 2393(d) of title 10, United 
States Code, as amended by section 4032(d), is further amended by 
adding at the end the following: ``The requirement shall not apply in 
the case of a subcontract for the acquisition of commercial items.''.
    (f) Inapplicability of Prohibition on Limitation of Subcontractor 
Direct Sales.--Section 2402 of title 10, United States Code, as amended 
by section 4032(e), is further amended by adding at the end the 
following new subsection:
    ``(d) An agreement between the contractor in a contract for the 
acquisition of commercial items and a subcontractor under such contract 
that restricts sales by such subcontractor directly to persons other 
than the contractor may not be considered to unreasonably restrict 
sales by that subcontractor to the United States in violation of the 
provision included in such contract pursuant to subsection (a) if the 
agreement does not result in the United States being treated 
differently with regard to the restriction than any other prospective 
purchaser of such commercial items from that subcontractor.''.
    (g) Inapplicability of Prohibition on Persons Convicted of Defense-
Related Felonies.--Section 2408(a) of title 10, United States Code, is 
amended by adding at the end of paragraph (4), as added by section 
4032(f), the following: ``The term does not include a contract for the 
purchase of commercial items.''.
    (h) Inapplicability of Contractor Inventory Accounting System 
Standards.--Section 2410b of title 10, United States Code, is amended 
by adding after subsection (b), as added by section 4032(g), the 
following:
    ``(c) The regulations prescribed pursuant to subsection (a) shall 
not apply to a contract for the purchase of commercial items.''.

                Subtitle C--Civilian Agency Acquisitions

SEC. 7201. DEFINITIONS.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.), as amended by section 1553, is further 
amended by adding after section 313 the following new section:

``SEC. 314. DEFINITIONS RELATING TO PROCUREMENT OF COMMERCIAL ITEMS.

    ``As used in this title, the terms `commercial item', 
`nondevelopmental item', `component', and `commercial component' have 
the meanings provided in section 4 of the Office of Federal Procurement 
Policy Act.''.

SEC. 7202. PREFERENCE FOR ACQUISITION OF COMMERCIAL ITEMS.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.), as amended by section 7201, is further 
amended by adding after section 314 the following new section:

``SEC. 314A. PREFERENCE FOR ACQUISITION OF COMMERCIAL ITEMS.

    ``(a) Preference.--The head of each executive agency shall ensure 
that, to the maximum extent practicable--
            ``(1) requirements of the agency with respect to a 
        procurement of supplies or services are stated in terms of--
                    ``(A) functions to be performed;
                    ``(B) performance required; or
                    ``(C) essential physical characteristics;
            ``(2) such requirements are defined so that commercial 
        items may be procured to fulfill such requirements; and
            ``(3) such requirements are fulfilled through the 
        procurement of commercial items.
    ``(b) Implementation.--The head of each executive agency shall 
ensure that procurement officials in that executive agency, to the 
maximum extent practicable--
            ``(1) acquire commercial items to meet the needs of the 
        executive agency;
            ``(2) require prime contractors and subcontractors at all 
        levels under the executive agency contracts to incorporate 
        commercial items as components of items supplied to the 
        executive agency;
            ``(3) modify requirements in appropriate cases to ensure 
        that the requirements can be met by commercial items;
            ``(4) state specifications in terms that enable and 
        encourage bidders and offerors to supply commercial items;
            ``(5) revise the executive agency's procurement policies, 
        practices, and procedures not required by law to reduce any 
        impediments in those policies, practices, and procedures to the 
        acquisition of commercial items; and
            ``(6) require training of appropriate personnel in the 
        acquisition of commercial items.
    ``(c) Existing or Prior Sources of Nondevelopmental Items.--(1) 
Notwithstanding subsection (a), the head of an executive agency may, 
until five years after the date of the enactment of the Federal 
Acquisition Improvement Act of 1994, determine that it is in the 
Government's interests to permit existing or prior sources of 
nondevelopmental items to participate in a competition for a commercial 
item in a case in which a nondevelopmental item will compete with a 
commercial item under the same terms, conditions, and evaluation and 
award criteria.
    ``(2) Nondevelopmental items furnished by an existing or prior 
source that must be modified to meet the requirements of a solicitation 
for commercial items may be offered under such a solicitation, but only 
in a case in which the modifications--
            ``(A) are necessary to comply with the Government's 
        solicitation requirements; and
            ``(B) do not significantly alter the function or essential 
        physical characteristics of the items to be supplied.
    ``(3) The policies, procedures, solicitation provisions, and 
contract clauses applicable to commercial items under this chapter also 
shall apply to nondevelopmental items furnished by an existing or prior 
source that is permitted to participate in a competition conducted 
under this title.
    ``(d) Preliminary Market Research.--(1) The head of an executive 
agency shall conduct market research appropriate to the circumstances--
            ``(A) before developing new specifications for a 
        procurement by that executive agency; and
            ``(B) before soliciting bids or proposals for a contract in 
        excess of the simplified acquisition threshold.
    ``(2) The head of an executive agency shall use the results of 
market research to determine whether there are commercial items 
available that--
            ``(A) meet the executive agency's requirements;
            ``(B) could be modified to meet the executive agency's 
        requirements; or
            ``(C) could meet the executive agency's requirements if 
        those requirements were modified to a reasonable extent.''.

SEC. 7203. EXCEPTION TO COST OR PRICING DATA REQUIREMENTS FOR 
              COMMERCIAL ITEMS.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.), as amended by section 7202, is further 
amended by adding after section 314A the following new section:

``SEC. 314B. EXCEPTION TO COST OR PRICING DATA REQUIREMENTS FOR 
              COMMERCIAL ITEMS.

    ``(a) Exemption From Section 304B if Price Based on Adequate Price 
Competition or Established Prices.--In any procurement of a commercial 
item, when the agreed-upon price of the commercial item is based on 
adequate price competition or on established catalog or market prices 
of items sold in sufficient quantities to the general public--
            ``(1) the procurement shall be exempt from section 304B of 
        this title; and
            ``(2) to the maximum extent practicable, the executive 
        agency may not require any additional information from the 
        offeror to determine price reasonableness.
    ``(b) Requirement To Determine Price Reasonableness For 
Noncompetitive Procurements.--In any case in which it is not 
practicable to conduct a procurement of a commercial item on a 
competitive basis and the procurement is not covered by subsection (a) 
or by an exception in subsection (b) of section 304B, the contracting 
officer shall use price analysis to determine whether the price is fair 
and reasonable. If the contracting officer is able to determine through 
price analysis that the price is reasonable, the procurement shall be 
exempt from section 304B of this title. Price analysis under this 
section shall be conducted by developing or obtaining from the offeror 
or contractor, or from another source or sources, in accordance with 
standards and procedures set forth in Federal Acquisition Regulations, 
information on prices at which the same or similar items have been sold 
in the commercial market that is adequate for evaluating the 
reasonableness of the price of the contract.
    ``(c) Authority To Request Cost or Pricing Data When Price 
Reasonableness Cannot Be Determined.--In any case in which a 
contracting officer is unable to determine under subsection (b) that a 
price is reasonable, the contracting officer, with the prior approval 
of the head of the procuring activity, may require cost or pricing data 
under section 304B.
    ``(d) Right To Audit.--(1) An executive agency is authorized to 
audit all documentation provided by an offeror under subsection (b) or 
(c) and all books and records of the offeror directly relating to such 
documentation, except that, if the offeror has made no representation 
as to the completeness of the documentation supplied, the executive 
agency is not authorized to audit for completeness.
    ``(2) The authority under this subsection shall expire--
            ``(A) one year after the date of commencement of 
        performance of the contract, or one year after the date of 
        commencement of performance of the modification of the 
        contract, with respect to which the information was provided; 
        or
            ``(B) on such other date agreed upon by the parties at the 
        time of contract award or contract definitization.
    ``(e) Limitations on Requests for Data.--The Federal Acquisition 
Regulation shall establish reasonable limitations on requests under 
this section for sales data relating to commercial items.
    ``(f) Form of Information.--In conducting a price analysis, or in 
requiring any additional information from an offeror, a contracting 
officer may request only that information from an offeror that is in 
the form regularly maintained by the offeror in commercial operations, 
adequate to demonstrate the market price of the item or items, or 
otherwise needed to establish a fair and reasonable price.
    ``(g) Confidentiality.--All documentation received from an offeror, 
if not otherwise in the public domain and if requested by the offeror 
and marked as proprietary, shall be treated by the Government as 
confidential and exempt from disclosure to the extent permitted by 
section 552 of title 5.''.
    (b) Cross Reference.--Section 304B of the Federal Property and 
Administrative Services Act of 1949, as added by section 1251, is 
amended by adding at the end the following new subsection:
    ``(h) Exceptions Regarding Commercial Items.--For provisions 
relating to exceptions for procurements of commercial items, see 
section 314B of this title.''.

SEC. 7204. PRINCIPLE OF CONSTRUCTION WITH FUTURE LAWS.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.), as amended by section 7203, is further 
amended by adding after section 314B the following new section:

``SEC. 314C. PRINCIPLE OF CONSTRUCTION WITH FUTURE LAWS.

    ``A provision of law enacted after the date of the enactment of the 
Federal Acquisition Improvement Act of 1994 may not be construed as 
applicable to purchases of commercial items by an executive agency 
unless that provision of law specifically refers to this section and 
specifically states that such provision of law modifies or supersedes 
sections 314 through 314D of this title.''.

SEC. 7205. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

    Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.), as amended by section 7204, is further 
amended by adding after section 314C the following new section:

``SEC. 314D. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

    ``(a) Provisions Inapplicable to Prime Contractors.--Procurements 
of commercial items shall not be subject to the following provisions of 
law (or regulations prescribed under such provisions):
            ``(1) Section 303G of this Act (relating to prohibition on 
        limitation of subcontractor direct sales).
            ``(2) Section 304(a) of this Act (relating to prohibition 
        on contingent fees).
            ``(3) Section 26 of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 422) (relating to cost accounting 
        standards board).
            ``(4) Section 27(e) of the Office of Federal Procurement 
        Policy Act (41 U.S.C. 423(e)) (relating to procurement 
        integrity).
            ``(5) The Drug-Free Workplace Act of 1988 (subtitle D of 
        title V of Public Law 100-690; 41 U.S.C. 701 et seq.).
    ``(b) Provisions Inapplicable to Subcontractors and Other 
Entities.--
            ``(1) Laws inapplicable.--Each provision of law listed 
        under subsection (a) (and regulations prescribed under each 
        such provision) shall not apply to any entity described in 
        paragraph (2).
            ``(2) Covered entities.--Paragraph (1) applies to each of 
        the following:
                    ``(A) Any division, subsidiary, or affiliate of a 
                prime contractor (other than the division, subsidiary, 
                or affiliate that is contracting with the Government 
                under the prime contract) or of a subcontractor of a 
                prime contractor, if such division, subsidiary, or 
                affiliate is furnishing a commercial item to the prime 
                contractor or subcontractor for purposes of carrying 
                out the prime contract or subcontract.
                    ``(B) Any subcontractor or supplier of a prime 
                contractor, if the subcontractor or supplier is 
                furnishing a commercial item to the prime contractor 
                for purposes of carrying out the prime contract.

SEC. 7206. CONFORMING AMENDMENTS RELATING TO INAPPLICABILITY OF CERTAIN 
              PROVISIONS OF LAW.

    (a) Inapplicability of Prohibition on Limiting Subcontractor Direct 
Sales to the United States.--Section 303G of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 253g), as amended by 
section 4042(a), is further amended by adding at the end the following 
new subsection:
    ``(d) An agreement between the contractor in a contract for the 
acquisition of commercial items and a subcontractor under such contract 
that restricts sales by such subcontractor directly to persons other 
than the contractor may not be considered to unreasonably restrict 
sales by that subcontractor to the United States in violation of the 
provision included in such contract pursuant to subsection (a) if the 
agreement does not result in the Federal Government being treated 
differently with regard to the restriction than any other prospective 
purchaser of such commercial items from that subcontractor.''.
    (b) Inapplicability of Requirement for Contract Clause Regarding 
Contingent Fees.--Section 304(a) of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 254(a)), as amended by 
section 4042(b), is further amended by inserting before the period at 
the end of the sentence added by section 4042(b) the following: ``or to 
a contract for the acquisition of commercial items''.

                   Subtitle D--Acquisitions Generally

SEC. 7301. CONFORMING AMENDMENT RELATING TO INAPPLICABILITY OF CERTAIN 
              PROVISIONS OF LAW.

    (a) Cost Accounting Standards Board.--Section 26(f) of the Office 
of Federal Procurement Policy Act (41 U.S.C. 422) is amended in 
paragraph (2) by striking out ``where the price negotiated'' and all 
that follows through ``(B)'' and inserting in lieu thereof ``(A) for 
the procurement of commercial items, or (B) for which the price 
negotiated is based on''.
    (b) Certification Requirements.--Subsection (e)(7)(A) of section 27 
of the Office of Federal Procurement Policy Act (41 U.S.C. 
423(e)(7)(A)), as amended by section 4051, is further amended by 
inserting before the period at the end the following: ``, for the 
procurement of goods and services other than commercial items''.
    (c) Drug-Free Workplace Act of 1988.--Section 5152 of the Drug-Free 
Workplace Act of 1988 (subtitle D of title V of Public Law 100-690; 41 
U.S.C. 701 et seq.), as amended by section 4054, is further amended by 
inserting after the matter inserted by such section 4057 the following: 
``, other than a contract for the procurement of commercial items as 
defined in section 4 of the Office of Federal Procurement Policy Act 
(41 U.S.C. 403)),''.

SEC. 7302. FLEXIBLE DEADLINES FOR SUBMISSION OF OFFERS OF COMMERCIAL 
              ITEMS.

    Section 18(a) of the Office of Federal Procurement Policy Act (41 
U.S.C. 416(a)) is amended by adding at the end the following new 
paragraph:
    ``(4) The Administrator shall prescribe regulations defining 
limited circumstances in which flexible deadlines can be used under 
paragraph (3) for the submission of bids or proposals for the 
procurement of commercial items.''.

SEC. 7303. ADDITIONAL RESPONSIBILITIES FOR ADVOCATES FOR COMPETITION.

    (a) Responsibilities of the Advocate for Competition.--Section 
20(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 
418(c)) is amended to read as follows:
    ``(c) The advocate for competition for each procuring activity 
shall be responsible for promoting full and open competition, promoting 
the acquisition of commercial items, and challenging barriers to such 
acquisition, including such barriers as unnecessarily restrictive 
statements of need, unnecessarily detailed specifications, and 
unnecessarily burdensome contract clauses.''.
    (b) Repeal of Superseded Provision.--Section 28 of such Act (41 
U.S.C. 424) is repealed.

SEC. 7304. PROVISIONS NOT AFFECTED.

    Nothing in this title shall be construed as modifying or 
superseding, or as intended to impair or restrict, authorities or 
responsibilities under--
            (1) section 315 of the Federal Property and Administrative 
        Services Act of 1949 or section 2323 of title 10, United States 
        Code;
            (2) section 111 of the Federal Property and Administrative 
        Services Act of 1949 (40 U.S.C. 759), popularly referred to as 
        the ``Brooks Automatic Data Processing Act'';
            (3) title IX of the Federal Property and Administrative 
        Services Act of 1949 (40 U.S.C. 541 et seq.), popularly 
        referred to as the ``Brooks Architect-Engineers Act'';
            (4) section 8(a) of the Small Business Act (15 U.S.C. 
        637(a)) or any other provision of that Act; or
            (5) the Act of June 25, 1938 (41 U.S.C. 46-48c), that was 
        revised and reenacted in the Act of June 23, 1971 (85 Stat. 
        77), commonly referred to as the ``Javits-Wagner-O'Day Act''.

SEC. 7305. COMPTROLLER GENERAL REVIEW OF FEDERAL GOVERNMENT USE OF 
              MARKET RESEARCH.

    (a) Report Required.--Not later than 2 years after the date of the 
enactment of this Act, the Comptroller General of the United States 
shall submit to the Congress a report on the use of market research by 
the Federal Government in support of the procurement of commercial 
items and nondevelopmental items.
    (b) Content of Report.--The report shall include the following:
            (1) A review of existing Federal Government market research 
        efforts to gather data concerning commercial and other 
        nondevelopmental items.
            (2) A review of the feasibility of creating a Government-
        wide data base for storing, retrieving, and analyzing market 
        data, including use of existing Federal Government resources.
            (3) Any recommendations for changes in law or regulations 
        that the Comptroller General considers appropriate.

                  TITLE VIII--MISCELLANEOUS PROVISIONS

SEC. 8001. TEST PROGRAM.

    (a) In General.--The Administrator for Federal Procurement Policy 
(in this section referred to as the ``Administrator'') may conduct a 
program of tests of alternative and innovative procurement procedures. 
To the extent consistent with this section, such program shall be 
conducted consistent with section 15 of the Office of Federal 
Procurement Policy Act (41 U.S.C. 413). No more than 6 such tests shall 
be conducted under this authority.
    (b) Designation of Agencies.--Each test conducted pursuant to 
subsection (a) shall be limited to not more than 2 specific contracting 
activities in an agency designated by the Administrator. Each agency so 
designated shall select the contracting activities participating in the 
test with the approval of the Administrator and shall designate a 
procurement testing official who shall be responsible for the conduct 
and evaluation of tests within that agency.
    (c) Test Requirements.--Tests conducted under subsection (a)--
            (1) shall be developed and structured by the Administrator 
        or by the agency senior procurement executives designated 
        pursuant to section 16(3) of the Office of Federal Procurement 
        Policy Act in close coordination with the Administrator;
            (2) shall be for a period of not greater than 4 years;
            (3) shall be limited to specific programs of agencies or 
        specific acquisitions;
            (4) may not include any test with a total estimated life-
        cycle cost to the Federal Government greater than $100,000,000;
            (5) shall include--
                    (A) a test by the National Aeronautics and Space 
                Administration of simplified procurement procedures for 
                acquisitions with an estimated annual total obligation 
                of funds of $500,000 or less;
                    (B) a test by the General Services Administration 
                of expedited methods for procuring automatic data 
                processing equipment commodities; and
                    (C) a test by at least one agency of streamlined 
                procedures for competition among interested sources 
                participating in the tailoring of a solicitation for 
                the purchase of commercial products; and
            (6) shall not include any procurement the cost of which is 
        expected to exceed $5,000,000 (including options).
    (d) Limitation on Total Value of Contracts Under Program.--
            (1) Limitation.--The Administrator shall ensure that the 
        total amount obligated under contracts awarded pursuant to the 
        program under this section does not exceed $600,000,000.
            (2) Monitoring.--The Administrator shall monitor the value 
        of contracts awarded pursuant to the program under this 
        section.
            (3) Prohibition on awards in excess of limit.--No contract 
        may be awarded under the program under this section if the 
        award of the contract would result in obligation of more than 
        $600,000,000 under contracts under this section.
    (e) Procedures Authorized.--Tests conducted under this section may 
include any of the following procedures:
            (1) Publication of agency needs before drafting of a 
        solicitation.
            (2) Screening of sources and competition among capable 
        vendors.
            (3) Issuance of draft solicitations for comment.
            (4) Streamlined solicitations, with a minimized number of 
        evaluation factors and information required from vendors, 
        abbreviated periods for submission of offers, and page 
        limitations on offers.
            (5) Limitation of source selection factors to--
                    (A) cost to the Federal Government;
                    (B) past experience; and
                    (C) quality of the contents of the offer.
            (6) Evaluation of proposals by small teams of highly 
        qualified people, limited to 30 days.
            (7) Competition among sources of preevaluated products.
            (8) Alternative notice and publication requirements.
            (9) A process in which--
                    (A) the competitive process is initiated by a 
                notice in the Commerce Business Daily synopsizing the 
                needs of the executive agency conducting the test, in 
                functional and performance terms, with other 
                specifications provided for guidance only;
                    (B) the notice invites interested sources to submit 
                information or samples showing their product's 
                suitability for those needs (with price quotations) or, 
                if appropriate, showing the sources' technical 
                capability, past performance, product supportability, 
                or other qualifications (with appropriate consideration 
                to rates and other cost-related factors);
                    (C) contracting officials develop a request for 
                proposals (including appropriate specifications and 
                evaluation criteria) after reviewing the submittals 
                made by interested sources and, if the officials 
                determine necessary, after consultation with those 
                sources; and
                    (D) the contract is awarded after a streamlined 
                competition limited to all sources that timely provided 
                product information in response to the notice or, if 
                appropriate, to those sources determined most capable 
                based on those qualification-based factors included in 
                an invitation to submit information pursuant to 
                subparagraph (B).
    (f) Test Plan.--Not later than 60 days before implementing any test 
program under this section, the Administrator shall--
            (1) provide a detailed test plan, including lists of any 
        regulations that are to be waived, and any written 
        determination under subsection (g)(1)(B) to the Committee on 
        Government Operations of the House of Representatives and the 
        Committee on Governmental Affairs of the Senate;
            (2) provide a copy of the plan to the appropriate 
        authorizing committees of the House of Representatives and the 
        Senate; and
            (3) publish the plan in the Federal Register and provide an 
        opportunity for public comment.
    (g) Waiver of Procurement Regulations.--
            (1) In general.--For purposes of a test conducted under 
        subsection (a), the Administrator may waive--
                    (A) any provision of the Federal Acquisition 
                Regulation that is not required by statute; and
                    (B) any provision of the Federal Acquisition 
                Regulation that is required by a provision of law 
                described in paragraph (2), the waiver of which the 
                Administrator determines in writing to be necessary to 
                conduct any test of any of the 9 procedures described 
                in subsection (e).
            (2) Provisions of law described.--The provisions of law 
        referred to in paragraph (1) are the following:
                    (A) Section 2304 of title 10, United States Code.
                    (B) Section 2305 of title 10, United States Code.
                    (C) Section 2319 of title 10, United States Code.
                    (D) Section 3709 of the Revised Statutes (41 U.S.C. 
                5).
                    (E) Section 3710 of the Revised Statutes (41 U.S.C. 
                8).
                    (F) Section 3735 of the Revised Statutes (41 U.S.C. 
                13).
                    (G) Subsections (e), (f), and (g) of section 8 of 
                the Small Business Act (15 U.S.C. 637).
                    (H) Section 310 of the Federal Property and 
                Administrative Services Act of 1949 (41 U.S.C. 260).
                    (I) Section 303 of the Federal Property and 
                Administrative Services Act of 1949 (41 U.S.C. 253).
                    (J) Section 303A of the Federal Property and 
                Administrative Services Act of 1949 (41 U.S.C. 253a).
                    (K) Section 303B of the Federal Property and 
                Administrative Services Act of 1949 (41 U.S.C. 253b).
                    (L) Section 303C of the Federal Property and 
                Administrative Services Act of 1949 (41 U.S.C. 253c).
                    (M) Section 4(6) of the Office of Federal 
                Procurement Policy Act (41 U.S.C. 403(6)).
                    (N) Section 18 of the Office of Federal Procurement 
                Policy Act (41 U.S.C. 416).
            (3) Proposal for additional waiver.--If the Administrator 
        determines that the conduct of a test requires the waiver of a 
        law not listed in paragraph (2) or requires approval of an 
        estimated dollar amount not permitted under subsection (c)(4), 
        the Administrator may propose legislation to authorize the 
        waiver or grant the approval. Before proposing such 
        legislation, the Administrator may provide and publish a test 
        plan as described in subsection (f). If Congress does not 
        authorize the waiver or grant the approval within 120 days 
        after the date of receipt of the proposal, the proposal shall 
        be deemed to be withdrawn. A proposal not approved within such 
        120 days may be resubmitted to Congress under this paragraph at 
        any time.
    (h) Reports and Reviews.--
            (1) Administrator.--The Administrator shall report to the 
        Congress on the results of each test conducted under subsection 
        (a).
            (2) Comptroller general.--The Comptroller General of the 
        United States shall review each test conducted under subsection 
        (a) and report to the Congress on each test and shall report 
        annually to the Congress on the conduct of and results of all 
        tests conducted under subsection (a).
    (i) Expiration of Authority.--The authority to conduct tests under 
this section and to award contracts under such tests shall expire on 
October 1, 1998. Contracts entered into before October 1, 1998, 
pursuant to a test shall remain in effect, notwithstanding the 
expiration of the authority to conduct the test under this section.
    (j) Federal Aviation Administration Acquisition Pilot Program.--(1) 
The Administrator shall delegate to the Secretary of Transportation 
authority to conduct a test of alternative and innovative procurement 
procedures in carrying out acquisitions for one of the modernization 
programs under the Airway Capital Investment Plan prepared pursuant to 
section 44501(b) of title 49, United States Code.
    (2) The authority delegated under paragraph (1) shall include 
authority for the Secretary of Transportation--
            (A) to apply any amendment or repeal of a provision of law 
        made in this Act to the pilot program before the effective date 
        of such amendment or repeal; and
            (B) to apply to a procurement of noncommercial items under 
        such program--
                    (i) any authority provided in this Act (or in an 
                amendment made by a provision of this Act) to waive a 
                provision of law in the case of commercial items, and
                    (ii) any exception applicable under this Act (or an 
                amendment made by a provision of this Act) in the case 
                of commercial items,
        before the effective date of such provision (or amendment) to 
        the extent that the Secretary determines necessary to test the 
        application of such waiver or exception to procurements of 
        noncommercial items.
    (3) Paragraph (2) applies with respect to--
            (A) a contract that is awarded or modified after the date 
        occurring 45 days after the date of the enactment of this Act; 
        and
            (B) a contract that is awarded before such date and is to 
        be performed (or may be performed), in whole or in part, after 
        such date.
    (4) The Administrator may use the waiver authority provided under 
subsection (g) to waive the applicability of any provision referred to 
in paragraph (1) of that subsection to the program designated by the 
Secretary of Transportation under this subsection.
    (k) Department of Defense Acquisition Pilot Programs.--
            (1) In general.--The Secretary of Defense is authorized to 
        designate the following defense acquisition programs for 
        participation in the defense acquisition pilot program 
        authorized by section 809 of the National Defense Authorization 
        Act for Fiscal Year 1991 (10 U.S.C. 2430 note):
                    (A) Fire support combined arms tactical trainer 
                (fscatt).--All contracts directly relating to the 
                procurement of a training simulation system, including 
                related hardware, software, and subsystems, to perform 
                collective training of field artillery gunnery teams, 
                with development of software as required to generate 
                the training exercises.
                    (B) Joint direct attack munition (jdam i).--All 
                contracts directly relating to the development and 
                procurement of a strap-on guidance kit, using an 
                inertially guided, Global Positioning System updated 
                guidance kit to enhance the delivery accuracy of 1000-
                pound and 2000-pound bombs in inventory.
            (C) Commercial-derivative aircraft (cda).--
                            (i) All contracts related to acquisition or 
                        upgrading of commercial-derivative aircraft for 
                        use in meeting future Air Force airlift, 
                        tanker, and airborne warning and control system 
                        requirements.
                            (ii) For purposes of this subparagraph, the 
                        term ``commercial-derivative aircraft'' means 
                        any of the following:
                                    (I) Any aircraft that is of a type 
                                customarily used in the course of 
                                normal business operations for other 
                                than Federal Government purposes, that 
                                has been issued a type certificate by 
                                the Administrator of the Federal 
                                Aviation Administration, and that has 
                                been sold or leased for use in the 
                                commercial marketplace or that has been 
                                offered for sale or lease for use in 
                                the commercial marketplace.
                                    (II) Any aircraft that, but for 
                                modifications of a type customarily 
                                available in the commercial 
                                marketplace, or minor modifications 
                                made to meet Federal Government 
                                requirements, would satisfy the 
                                criteria in subclause (I).
                    (D) Commercial-derivative engine.--The commercial 
                derivative engine program with respect to all contracts 
                directly related to the acquisition of (i) commercially 
                derived engines (including spare engines), logistics 
                support equipment, technical orders, management data, 
                and initial spare parts for use in supporting the 
                purchase of commercial-derivative aircraft to meet 
                future Air Force airlift and tanker requirements, 
                including engine replacement and upgrades.
            (2) Conduct of defense acquisition programs.--In the case 
        of each defense acquisition program designated under paragraph 
        (1) for participation in the Defense Acquisition Pilot Program, 
        the Secretary of Defense shall--
                    (A) develop guidelines and procedures for carrying 
                out the program and the criteria to be used in 
                measuring the success of the program;
                    (B) evaluate the potential costs and benefits which 
                may be derived from the innovative procurement methods 
                and procedures tested under the program; and
                    (C) develop the methods to be used to analyze the 
                results of the program.
            (3) Special authority.--The authority delegated under 
        paragraph (1) may include authority for the Secretary of 
        Defense--
                    (A) to apply any amendment or repeal of a provision 
                of law made in this Act to the pilot programs before 
                the effective date of such amendment or repeal; and
                    (B) to apply to a procurement of noncommercial 
                items under such programs--
                            (i) any authority provided in such Act (or 
                        in an amendment made by a provision of such 
                        Act) to waive a provision of law in the case of 
                        commercial items, and
                            (ii) any exception applicable under such 
                        Act (or an amendment made by a provision of 
                        such Act) in the case of commercial items,
                before the effective date of such provision (or 
                amendment) to the extent that the Secretary determines 
                necessary to test the application of such waiver or 
                exception to procurements of noncommercial items.
            (4) Applicability.--(A) Paragraph (3) applies with respect 
        to--
                    (i) a contract that is awarded or modified during 
                the period described in subparagraph (B); and
                    (ii) a contract that is awarded before the 
                beginning of such period and is to be performed (or may 
                be performed), in whole or in part, during such period.
            (B) The period referred to in subparagraph (A) is the 
        period that begins 45 days after the date of the enactment of 
        this Act and ends on September 30, 1998.

SEC. 8002. STUDY OF PARTICIPATION BY CERTAIN SMALL BUSINESSES IN 
              FEDERAL PROCUREMENT.

    (a) Study.--The Administrator for Federal Procurement Policy shall 
conduct a study of--
            (1) the degree of participation by small businesses owned 
        and controlled by socially and economically disadvantaged 
        individuals in procurements conducted by executive agencies, 
        other than agencies in the Department of Defense; and
            (2) the extent of compliance by those executive agencies 
        with the goals for participation by such businesses required by 
        Office of Federal Procurement Policy policy letter 91-1, 
        relating to Government-wide small business and small 
        disadvantaged business goals for procurement contracts.
    (b) Report.--Not later than 6 months after the date of the 
enactment of this Act, the Administrator for Federal Procurement Policy 
shall submit a report on the study required under subsection (a) to the 
Committee on Government Operations and the Committee on Small Business 
of the House of Representatives, and to the Committee on Governmental 
Affairs and the Committee on Small Business of the Senate. The report 
shall include recommendations to facilitate the provision of authority 
to executive agencies, other than agencies in the Department of 
Defense, to conduct procurement set asides for small businesses owned 
and controlled by socially and economically disadvantaged individuals, 
and on improved outreach programs to increase the participation by such 
businesses in procurements conducted by those executive agencies.
    (b) Extension of Defense Contract Goal to Coast Guard and NASA.--
Section 2323 of title 10, United States Code, is amended to read as 
follows:
``Sec. 2323. Contract goal for small disadvantaged businesses and 
              certain institutions of higher education
    ``(a) Goal.--(1) Except as provided in subsection (d), a goal of 5 
percent of the amount described in subsection (b) shall be the 
objective of the Department of Defense, the Coast Guard, and the 
National Aeronautics and Space Administration in each of fiscal years 
1987 through 2000 for the total combined amount obligated for contracts 
and subcontracts entered into with--
            ``(A) small business concerns, including mass media and 
        advertising firms, owned and controlled by socially and 
        economically disadvantaged individuals (as such term is used in 
        section 8(d) of the Small Business Act (15 U.S.C. 637(d)) and 
        regulations issued under that section), the majority of the 
        earnings of which directly accrue to such individuals;
            ``(B) historically Black colleges and universities; and
            ``(C) minority institutions (as defined in paragraphs (3), 
        (4), and (5) of section 312(b) of the Higher Education Act of 
        1965 (20 U.S.C. 1058)), including any nonprofit research 
        institution that was an integral part of a historically Black 
        college or university before November 14, 1986.
    ``(2) The head of the agency shall establish a specific goal within 
the overall 5 percent goal for the award of prime contracts and 
subcontracts to historically Black colleges and universities and 
minority institutions in order to increase the participation of such 
colleges and universities in the program provided for by this section.
    ``(3) The Federal Acquisition Regulation (issued under section 
25(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 
421(c)) shall provide procedures or guidelines for contracting officers 
to set goals which agency prime contractors that are required to submit 
subcontracting plans under section 8(d)(4)(B) of the Small Business Act 
(15 U.S.C. 637(d)(4)(B)) in furtherance of the agency's program to meet 
the 5 percent goal specified in paragraph (1) should meet in awarding 
subcontracts, including subcontracts to minority-owned media, to 
entities described in that paragraph.
  ``(b) Amount.--
            ``(1) Department of defense.--With respect to the 
        Department of Defense, the requirements of subsection (a) for 
        any fiscal year apply to the combined total of the following 
        amounts:
                    ``(A) Funds obligated for contracts entered into 
                with the Department of Defense for such fiscal year for 
                procurement.
                    ``(B) Funds obligated for contracts entered into 
                with the Department of Defense for such fiscal year for 
                research, development, test, and evaluation.
                    ``(C) Funds obligated for contracts entered into 
                with the Department of Defense for such fiscal year for 
                military construction.
                    ``(D) Funds obligated for contracts entered into 
                with the Department of Defense for operation and 
                maintenance.
            ``(2) Coast guard.--With respect to the Coast Guard, the 
        requirements of subsection (a) for any fiscal year apply to the 
        total value of all prime contract and subcontract awards 
        entered into by the Coast Guard for such fiscal year.
            ``(3) National aeronautics and space administration.--With 
        respect to the National Aeronautics and Space Administration, 
        the requirements of subsection (a) for any fiscal year apply to 
        the total value of all prime contract and subcontract awards 
        entered into by the National Aeronautics and Space 
        Administration for such fiscal year.
    ``(c) Types of Assistance.--(1) To attain the goal specified in 
subsection (a)(1), the head of the agency shall provide technical 
assistance to the entities referred to in that subsection and, in the 
case of historically Black colleges and universities and minority 
institutions, shall also provide infrastructure assistance.
    ``(2) Technical assistance provided under this section shall 
include information about the program, advice about agency procurement 
procedures, instruction in preparation of proposals, and other such 
assistance as the agency head considers appropriate. If the resources 
of the agency are inadequate to provide such assistance, the agency 
head may enter into contracts with minority private sector entities 
with experience and expertise in the design, development, and delivery 
of technical assistance services to eligible individuals, business 
firms and institutions, acquisition agencies, and prime contractors. 
Agency contracts with such entities shall be awarded annually, based 
upon, among other things, the number of minority small business 
concerns, historically Black colleges and universities, and minority 
institutions that each such entity brings into the program.
    ``(3) Infrastructure assistance provided by the Department of 
Defense under this section to historically Black colleges and 
universities and to minority institutions may include programs to do 
the following:
            ``(A) Establish and enhance undergraduate, graduate, and 
        doctoral programs in scientific disciplines critical to the 
        national security functions of the Department of Defense.
            ``(B) Make Department of Defense personnel available to 
        advise and assist faculty at such colleges and universities in 
        the performance of defense research and in scientific 
        disciplines critical to the national security functions of the 
        Department of Defense.
            ``(C) Establish partnerships between defense laboratories 
        and historically Black colleges and universities and minority 
        institutions for the purpose of training students in scientific 
        disciplines critical to the national security functions of the 
        Department of Defense.
            ``(D) Award scholarships, fellowships, and the 
        establishment of cooperative work-education programs in 
        scientific disciplines critical to the national security 
        functions of the Department of Defense.
            ``(E) Attract and retain faculty involved in scientific 
        disciplines critical to the national security functions of the 
        Department of Defense.
            ``(F) Equip and renovate laboratories for the performance 
        of defense research.
            ``(G) Expand and equip Reserve Officer Training Corps 
        activities devoted to scientific disciplines critical to the 
        national security functions of the Department of Defense.
            ``(H) Provide other assistance as the Secretary determines 
        appropriate to strengthen scientific disciplines critical to 
        the national security functions of the Department of Defense or 
        the college infrastructure to support the performance of 
        defense research.
    ``(4) The head of the agency shall, to the maximum extent 
practical, carry out programs under this section at colleges, 
universities, and institutions that agree to bear a substantial portion 
of the cost associated with the programs.
  ``(d) Applicability.--Subsection (a) does not apply to the Department 
of Defense--
            ``(1) to the extent to which the Secretary of Defense 
        determines that compelling national security considerations 
        require otherwise; and
            ``(2) if the Secretary notifies Congress of such 
        determination and the reasons for such determination.
    ``(e) Competitive Procedures and Advance Payments.--To attain the 
goal of subsection (a):
            ``(1)(A) The head of the agency shall--
                    ``(i) ensure that substantial progress is made in 
                increasing awards of agency contracts to entities 
                described in subsection (a)(1);
                    ``(ii) exercise his utmost authority, 
                resourcefulness, and diligence;
                    ``(iii) in the case of the Department of Defense, 
                actively monitor and assess the progress of the 
                military departments, Defense Agencies, and prime 
                contractors of the Department of Defense in attaining 
                such goal; and
                    ``(iv) in the case of the Coast Guard and the 
                National Aeronautics and Space Administration, actively 
                monitor and assess the progress of the prime 
                contractors of the agency in attaining such goal.
            ``(B) In making the assessment under clauses (iii) and (iv) 
        of subparagraph (A), the agency head shall evaluate the extent 
        to which use of the authority provided in paragraphs (2) and 
        (3) and compliance with the requirement in paragraph (4) is 
        effective for facilitating the attainment of the goal.
            ``(2) To the extent practicable and when necessary to 
        facilitate achievement of the 5 percent goal described in 
        subsection (a), the agency head shall make advance payments 
        under section 2307 of this title to contractors described in 
        subsection (a). The Federal Acquisition Regulation shall 
        provide guidance to contracting officers for making advance 
        payments to entities described in subsection (a)(1) under such 
        section.
            ``(3) To the extent practicable and when necessary to 
        facilitate achievement of the 5 percent goal described in 
        subsection (a), the agency head may enter into contracts using 
        less than full and open competitive procedures (including 
        awards under section 8(a) of the Small Business Act) and 
        partial set asides for entities described in subsection (a)(1), 
        but shall pay a price not exceeding fair market cost by more 
        than 10 percent in payment per contract to contractors or 
        subcontractors described in subsection (a). The agency head 
        shall adjust the percentage specified in the preceding sentence 
        for any industry category if available information clearly 
        indicates that nondisadvantaged small business concerns in such 
        industry category are generally being denied a reasonable 
        opportunity to compete for contracts because of the use of that 
        percentage in the application of this paragraph.
            ``(4) To the extent practicable, the agency head shall 
        maximize the number of minority small business concerns, 
        historically Black colleges and universities, and minority 
        institutions participating in the program.
            ``(5) The agency head shall prescribe regulations which 
        provide for the following:
                    ``(A) Procedures or guidance for contracting 
                officers to provide incentives for prime contractors 
                referred to in subsection (a)(3) to increase 
                subcontractor awards to entities described in 
                subsection (a)(1).
                    ``(B) A requirement that contracting officers 
                emphasize the award of contracts to entities described 
                in subsection (a)(1) in all industry categories, 
                including those categories in which such entities have 
                not traditionally dominated.
                    ``(C) Guidance to agency personnel on the 
                relationship among the following programs:
                            ``(i) The program implementing this 
                        section.
                            ``(ii) The program established under 
                        section 8(a) of the Small Business Act (15 
                        U.S.C. 637(a)).
                            ``(iii) The small business set-aside 
                        program established under section 15(a) of the 
                        Small Business Act (15 U.S.C. 644(a)).
                    ``(D) With respect to an agency procurement which 
                is reasonably likely to be set aside for entities 
                described in subsection (a)(1), a requirement that (to 
                the maximum extent practicable) the procurement be 
                designated as such a set-aside before the solicitation 
                for the procurement is issued.
                    ``(E) Policies and procedures which, to the maximum 
                extent practicable, will ensure that current levels in 
                the number or dollar value of contracts awarded under 
                the program established under section 8(a) of the Small 
                Business Act (15 U.S.C. 637(a)) and under the small 
                business set-aside program established under section 
                15(a) of the Small Business Act (15 U.S.C. 644(a)) are 
                maintained and that every effort is made to provide new 
                opportunities for contract awards to eligible entities, 
                in order to meet the goal of subsection (a).
                    ``(F) Implementation of this section in a manner 
                which will not alter the procurement process under the 
                program established under section 8(a) of the Small 
                Business Act (15 U.S.C. 637(a)).
                    ``(G) A requirement that one factor used in 
                evaluating the performance of a contracting officer be 
                the ability of the officer to increase contract awards 
                to entities described in subsection (a)(1).
                    ``(H) Increased technical assistance to entities 
                described in subsection (a)(1).
    ``(f) Penalties and Regulations Relating to Status.--(1) Whoever 
for the purpose of securing a contract or subcontract under subsection 
(a) misrepresents the status of any concern or person as a small 
business concern owned and controlled by a minority (as described in 
subsection (a)), shall be punished by imprisonment for not more than 
one year, or a fine under title 18, or both.
    ``(2) The Federal Acquisition Regulation shall prohibit awarding a 
contract under this section to an entity described in subsection (a)(1) 
unless the entity agrees to comply with the requirements of section 
15(o)(1) of the Small Business Act (15 U.S.C. 644(o)(1)).
    ``(g) Industry Categories.--(1) To the maximum extent practicable, 
the head of the agency shall--
            ``(A) ensure that no particular industry category bears a 
        disproportionate share of the contracts awarded to attain the 
        goal established by subsection (a); and
            ``(B) ensure that contracts awarded to attain the goal 
        established by subsection (a) are made across the broadest 
        possible range of industry categories.
    ``(2) Under procedures prescribed by the head of the agency, a 
person may request the Secretary to determine whether the use of small 
disadvantaged business set asides by a contracting activity of the 
agency has caused a particular industry category to bear a 
disproportionate share of the contracts awarded to attain the goal 
established for that contracting activity for the purposes of this 
section. Upon making a determination that a particular industry 
category is bearing a disproportionate share, the agency head shall 
take appropriate actions to limit the contracting activity's use of set 
asides in awarding contracts in that particular industry category.
    ``(h) Compliance With Subcontracting Plan Requirements.--(1) The 
Federal Acquisition Regulation shall contain regulations to ensure that 
potential contractors submitting sealed bids or competitive proposals 
to the agency for procurement contracts to be awarded under the program 
provided for by this section are complying with applicable 
subcontracting plan requirements of section 8(d) of the Small Business 
Act (15 U.S.C. 637(d)).
    ``(2) The regulations required by paragraph (1) shall ensure that, 
with respect to a sealed bid or competitive proposal for which the 
bidder or offeror is required to negotiate or submit a subcontracting 
plan under section 8(d) of the Small Business Act (15 U.S.C. 637(d)), 
the subcontracting plan shall be a factor in evaluating the bid or 
proposal.
    ``(i) Annual Report.--(1) Not later than December 15 of each year, 
the head of the agency shall submit to Congress a report on the 
progress of the agency toward attaining the goal of subsection (a) 
during the preceding fiscal year.
    ``(2) The report required under paragraph (1) shall include the 
following:
            ``(A) A full explanation of any progress toward attaining 
        the goal of subsection (a).
            ``(B) A plan to achieve the goal, if necessary.
    ``(3) The report required under paragraph (1) shall also include 
the following:
            ``(A) The aggregate differential between the fair market 
        price of all contracts awarded pursuant to subsection (e)(3) 
        and the estimated fair market price of all such contracts had 
        such contracts been entered into using full and open 
        competitive procedures.
            ``(B) An analysis of the impact that subsection (a) shall 
        have on the ability of small business concerns not owned and 
        controlled by socially and economically disadvantaged 
        individuals to compete for contracts with the agency.
            ``(C) A description of the percentage of contracts 
        (actions), the total dollar amount (size of action), and the 
        number of different entities relative to the attainment of the 
        goal of subsection (a), separately for Black Americans, Native 
        Americans, Hispanic Americans, Asian Pacific Americans, and 
        other minorities.
    ``(j) Definitions.--In this section:
            ``(1) The term `agency' means the Department of Defense, 
        the Coast Guard, and the National Aeronautics and Space 
        Administration.
            ``(2) The term `head of an agency' means the Secretary of 
        Defense, the Secretary of Transportation, and the Administrator 
        of the National Aeronautics and Space Administration.''.

SEC. 8004. EDUCATION AND TRAINING.

    Section 6(d)(5) of the Office of Federal Procurement Policy Act (41 
U.S.C. 405(d)(5)) is amended--
            (1) by striking out ``and'' at the end of subparagraph (A);
            (2) by striking out the semicolon at the end of 
        subparagraph (B) and inserting in lieu thereof ``; and''; and
            (3) by adding at the end the following new subparagraph:
                    ``(C) establish policies and procedures for the 
                establishment and implementation of education and 
                training programs authorized by this Act, including the 
                establishment and implementation of training, in 
                conjunction with the General Services Administration, 
                for critical procurement personnel designed to increase 
                the participation of small business concerns owned and 
                controlled by socially and economically disadvantaged 
                individuals, women, and other minorities in procurement 
                activities conducted by an executive agency.''.

SEC. 8005. DEPARTMENT OF DEFENSE ACQUISITION OF INTELLECTUAL PROPERTY 
              RIGHTS.

    Section 2386 of title 10, United States Code, is amended by 
striking out paragraphs (3) and (4) and inserting in lieu thereof the 
following:
            ``(3) Technical data and computer software.
            ``(4) Releases for past infringement of patents or 
        copyrights or for unauthorized use of technical data or 
        computer software.''.

SEC. 8006. SENSE OF CONGRESS ON NEGOTIATED RULEMAKING.

    (a) Findings.--The Congress finds the following:
            (1) The use of negotiated rulemaking or similar policy 
        discussion group techniques is an appropriate tool for--
                    (A) fostering effective implementation of, and 
                compliance with, laws and regulations;
                    (B) avoiding litigation; and
                    (C) achieving more productive and equitable 
                relationships between the Federal Government and the 
                regulated segments of the private sector.
            (2) The use of negotiated rulemaking or similar techniques 
        in Federal procurement regulations could be appropriate given 
        the extreme complexity and intricate interactions between buyer 
        and seller in Federal procurements.
    (b) Sense of Congress.--It is the sense of Congress that, in 
prescribing acquisition regulations, the Federal Acquisition Regulatory 
Council should consider using negotiated rulemaking procedures in 
accordance with sections 561 through 570 of title 5, United States 
Code, or similar techniques intended to achieve the benefits described 
in subsection (a)(1).

SEC. 8007. VENDOR AND EMPLOYEE EXCELLENCE AWARDS.

    Section 6(d) of the Office of Federal Procurement Policy Act (41 
U.S.C. 405(d)) is amended--
            (1) by striking out the period at the end of paragraph (10) 
        (as redesignated by section 4011(b)(2)) and inserting in lieu 
        thereof a semicolon; and
            (2) by adding at the end the following new paragraphs:
            ``(11) providing for a Government-wide award to recognize 
        and promote vendor excellence; and
            ``(12) providing for a Government-wide award to recognize 
        and promote excellence in officers and employees of the Federal 
        Government serving in procurement-related positions.''.

SEC. 8008. CODIFICATION OF ACCOUNTING REQUIREMENT FOR CONTRACTED 
              ADVISORY AND ASSISTANCE SERVICES.

    (a) Funding To Be Identified in Budget.--Section 1105 of title 31, 
United States Code, is amended by adding at the end the following new 
subsection:
    ``(g)(1) The Director of the Office of Management and Budget shall 
establish the funding for consulting services for each department and 
agency as a separate object class in each budget annually submitted to 
the Congress under this section.
    ``(2)(A) In paragraph (1), except as provided in subparagraph (B), 
the term `advisory and assistance services' means the following 
services when provided by nongovernmental sources:
            ``(i) Management and professional support services.
            ``(ii) Studies, analyses, and evaluations.
            ``(iii) Engineering and technical services.
    ``(B) In paragraph (1), the term `advisory and assistance services' 
does not include the following services:
            ``(i) Routine automated data processing and 
        telecommunications services (as defined in the Federal 
        Information Resources Management Regulation prescribed by the 
        Administrator of General Services) unless such services are an 
        integral part of a contract for the procurement of advisory and 
        assistance services.
            ``(ii) Architectural and engineering services.
            ``(iii) Technical support of research and development 
        activities.
            ``(iv) Research on basic mathematics or medical, 
        biological, physical, social, psychological, or other 
        phenomena.''.
    (b) Repeal of Source Law.--Section 512 of Public Law 102-394 (106 
Stat. 1826) is repealed.
    (c) Repeal of Superseded Provisions.--
            (1) DOD specific law.--Section 2212 of title 10, United 
        States Code, is repealed.
            (2) Government-wide law.--Section 1114 of title 31, United 
        States Code, is repealed.
            (3) Clerical amendments.--The table of sections at the 
        beginning of chapter 131 of title 10, United States Code, is 
        amended by striking out the item relating to section 2212. The 
        table of sections at the beginning of chapter 11 of title 31, 
        United States Code, is amended by striking out the item 
        relating to section 1114.

SEC. 8009. TECHNICAL AND CLERICAL AMENDMENTS.

    (a) Table of Contents Amendments.--
            (1) Office of federal procurement policy act.--The first 
        section of the Office of Federal Procurement Policy Act (41 
        U.S.C. 401 note) is amended to read as follows:

``SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    ``(a) Short Title.--This Act may be cited as the `Office of Federal 
Procurement Policy Act'.
    ``(b) Table of Contents.--The table of contents for this Act is as 
follows:

``Sec. 1.    Short title; table of contents.
``Sec. 2.    Declaration of policy.
``Sec. 3.    Findings and purpose.
``Sec. 4.    Definitions.
``Sec. 4A.  Simplified acquisition threshold.
``Sec. 4B.  Procedures applicable to purchases below micro-purchase 
                            threshold.
``Sec. 5.    Office of Federal Procurement Policy.
``Sec. 6.    Authority and functions of the Administrator.
``Sec. 7.    Administrative powers.
``Sec. 8.    Responsiveness to Congress.
``Sec. 9.    Effect on existing laws.
``Sec. 10.   Effect on existing regulations.
``Sec. 11.   Authorization of appropriations.
``Sec. 12.   Delegation.
``Sec. 14.   Access to information.
``Sec. 15.   Tests of innovative procurement methods and procedures.
``Sec. 16.   Executive agency responsibilities.
``Sec. 18.   Procurement notice.
``Sec. 19.   Record requirements.
``Sec. 20.   Advocates for competition.
``Sec. 21.   Rights in technical data.
``Sec. 22.   Publication of proposed regulations.
``Sec. 23.   Contracting functions performed by Federal personnel.
``Sec. 24.   Travel expenses of Government contractors.
``Sec. 25.   Federal Acquisition Regulatory Council.
``Sec. 26.   Cost Accounting Standards Board.
``Sec. 27.   Procurement integrity.
``Sec. 28.   Advocate for the Acquisition of Commercial Products.
``Sec. 29.   Nonstandard contract clauses.
``Sec. 30.   Federal acquisition computer network (FACNET).''.
            (2) Federal property and administrative services act of 
        1949.--The first section of the Federal Property and 
        Administrative Services Act of 1949 (41 U.S.C. 471 et seq.) is 
        amended to read as follows:

``SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    ``(a) Short Title.--This Act may be cited as the `Federal Property 
and Administrative Services Act of 1949'.
    ``(b) Table of Contents.--The table of contents for this Act is as 
follows:

``Sec. 1.      Short title; table of contents.
``Sec. 2.      Declaration of policy.
``Sec. 3.      Definitions.

                        ``TITLE I--ORGANIZATION

``Sec. 101.    General Services Administration.
``Sec. 102.    Transfer of affairs of Bureau of Federal Supply.
``Sec. 103.    Transfer of affairs of the Federal Works Agency.
``Sec. 104.    Records management: Transfer of the National Archives.
``Sec. 106.    Redistribution of functions.
``Sec. 107.    Transfer of funds.
``Sec. 109.    General supply fund.
``Sec. 110.    Information Technology Fund.
``Sec. 111.    Automatic data processing equipment.
``Sec. 112.    Federal information centers.

                    ``TITLE II--PROPERTY MANAGEMENT

``Sec. 201.    Procurement, warehousing, and related activities.
``Sec. 202.    Property utilization.
``Sec. 203.    Disposal of surplus property.
``Sec. 204.    Proceeds from transfer or disposition of property.
``Sec. 205.    Policies, regulations, and delegations.
``Sec. 206.    Surveys, standardization, and cataloging.
``Sec. 207.    Applicability of antitrust laws.
``Sec. 208.    Employment of personnel.
``Sec. 209.    Civil remedies and penalties.
``Sec. 210.    Operation of buildings and related activities.
``Sec. 211.    Motor vehicle identification and operation.
``Sec. 212.    Reports to Congress.

                   ``TITLE III--PROCUREMENT PROCEDURE

``Sec. 301.    Declaration of purpose.
``Sec. 302.    Application and procurement methods.
``Sec. 302A.  Simplified acquisition threshold.
``Sec. 302B.  Implementation of FACNET capability.
``Sec. 303.    Competition requirements.
``Sec. 303A.  Planning and solicitation requirements.
``Sec. 303B.  Evaluation and award.
``Sec. 303C.  Encouragement of new competition.
``Sec. 303D.  Validation of proprietary data restrictions.
``Sec. 303F.  Economic order quantities.
``Sec. 303G.  Prohibition of contractors limiting subcontractor sales 
                            directly to the United States.
``Sec. 303H.  Severable services contracts for periods crossing fiscal 
                            years.
``Sec. 304.    Contract requirements.
``Sec. 304A.  Multiyear contracts.
``Sec. 304B.  Cost or pricing data: truth in negotiations.
``Sec. 304C.  Examination of records of contractor.
``Sec. 305.    Contract financing.
``Sec. 306.    Allowable costs.
``Sec. 307.    Administrative determinations and delegations.
``Sec. 309.    Definitions.
``Sec. 310.    Statutes not applicable.
``Sec. 311.    Cooperative agreements for basic, applied, and advanced 
                            research.
``Sec. 312.    Assignment and delegation of procurement functions and 
                            responsibilities.
``Sec. 313.    Determinations and decisions.
``Sec. 314.    Definitions relating to procurement of commercial items.
``Sec. 314A.  Preference for acquisition of commercial items and other 
                            nondevelopmental items.
``Sec. 314B.  Pricing documentation for commercial items.
``Sec. 314C.  Principle of construction with future laws.
``Sec. 314D.  Inapplicability of certain provisions of law.
``Sec. 315.    Contract goal for small disadvantaged businesses and 
                            certain institutions of higher education.

                  ``TITLE IV--FOREIGN EXCESS PROPERTY

``Sec. 401.    Disposal of foreign excess property.
``Sec. 402.    Methods and terms of disposal.
``Sec. 403.    Proceeds; foreign currencies.
``Sec. 404.    Miscellaneous provisions.

                     ``TITLE VI--GENERAL PROVISIONS

``Sec. 601.    Applicability of existing procedures.
``Sec. 602.    Repeal and saving provisions.
``Sec. 603.    Authorization for appropriations and transfer of 
                            authority.
``Sec. 604.    Separability.
``Sec. 605.    Effective date.

                  ``TITLE VIII--URBAN LAND UTILIZATION

``Sec. 801.    Short title.
``Sec. 802.    Declaration of purpose and policy.
``Sec. 803.    Disposal of urban lands.
``Sec. 804.    Acquisition or change of use of real property.
``Sec. 805.    Waiver during national emergency.
``Sec. 806.    Definitions.

           ``TITLE IX--SELECTION OF ARCHITECTS AND ENGINEERS

``Sec. 901.    Definitions.
``Sec. 902.    Policy.
``Sec. 903.    Requests for data on architectural and engineering 
                            services.
``Sec. 904.    Negotiation of contracts for architectural and 
                            engineering services.
``Sec. 905.    Short title.''.
    (b) Amendments for Stylistic Consistency.--
            (1) Office of federal procurement policy act.--The Office 
        of Federal Procurement Policy Act (41 U.S.C. 401 et seq.) is 
        amended so that the section designation and section heading of 
        each section of such Act is in the same form and typeface as 
        the section designation and heading of this section.
            (2) Federal property and administrative services act of 
        1949.--The Federal Property and Administrative Services Act of 
        1949 (41 U.S.C. 471 et seq.) is amended so that the section 
        designation and section heading of each section of such Act is 
        in the same form and typeface as the section designation and 
        heading of this section.
    (c) Repeals of Executed Provisions.--The Office of Federal 
Procurement Policy Act (41 U.S.C. 401 et seq.) is amended--
            (1) by striking out section 13; and
            (2) by striking out the first section 15.
    (d) Cross Reference Corrections.--Section 3552 of title 31, United 
States Code, is amended--
            (1) by striking out ``section 111(h)'' and inserting in 
        lieu thereof ``section 111(f)''; and
            (2) by striking out ``759(h)'' and inserting in lieu 
        thereof ``759(f)''.
    (e) Consistency of Terminology With Customary Usage.--Section 
304(b) of the Federal Property and Administrative Services Act of 1949 
(41 U.S.C. 254(b)) is amended by striking out ``per centum'' each place 
it appears and inserting in lieu thereof ``percent''.
    (f) Enactment of Popular Names of Certain Acts.--
            (1) Brooks Architect-Engineers Act.--Title IX of the 
        Federal Property and Administrative Services Act of 1949 (40 
        U.S.C. 541-544) is amended by adding at the end the following 
        new section:

``SEC. 905. SHORT TITLE.

    ``This title may be cited as the `Brooks Architect-Engineers 
Act'.''.
            (2) Brooks Automatic Data Processing Act.--Section 111 of 
        the Federal Property and Administrative Services Act of 1949 
        (40 U.S.C. 759) is amended by adding at the end the following 
        new subsection:
    ``(h) This section may be cited as the `Brooks Automatic Data 
Processing Act'.''.
            (3) Buy American Act.--The Act of March 3, 1933 (41 U.S.C. 
        10a-10c), commonly referred to as the ``Buy American Act'', is 
        amended by adding at the end the following new section:
    ``Sec. 5. This Act may be cited as the `Buy American Act'.''.
            (4) Javits-Wagner-O'Day Act.--The Act entitled `An Act to 
        create a Committee on Purchases of Blind-made Products, and for 
        other purposes', approved June 25, 1938 (41 U.S.C. 46-48c), 
        that was revised and reenacted in the Act of June 23, 1971 (85 
        Stat. 77), is amended by adding at the end the following new 
        section:

                             ``short title

    ``Sec. 7. This Act may be cited as the `Javits-Wagner-O'Day 
Act'.''.

               TITLE IX--EFFECTIVE DATES AND REGULATIONS

SEC. 9001. EFFECTIVE DATES.

    (a) In General.--Except as provided in subsection (b), this Act and 
the amendments made by this Act shall apply with respect to any 
contract for which a solicitation for bid or proposal is issued after--
            (1) 30 days have expired after the issuance in final form 
        of revisions to the Federal Acquisition Regulation pursuant to 
        section 9002; or
            (2) 270 days have expired after the date of the enactment 
        of this Act;
whichever is earlier.
    (b) Specific Effective Dates.--(1) Titles III and VI of this Act, 
and the amendments made by such titles, shall take effect on the date 
of the enactment of this Act.
    (2) Subtitle D of title I of this Act, and the amendments made by 
such subtitle (relating to procurement protests), shall apply with 
respect to any protest filed after the expiration of the 90-day period 
beginning on the date of the enactment of this Act.

SEC. 9002. REGULATIONS.

    Not later than 240 days after the date of the enactment of this 
Act, the Federal Acquisition Regulation (referred to in section 25(c) 
of the Office of Federal Procurement Policy Act (41 U.S.C. 421(c))) 
shall be revised, in final form, to implement this Act and the 
amendments made by this Act.

SEC. 9003. EVALUATION BY THE COMPTROLLER GENERAL.

    (a) Evaluation Relating to Issuance of Regulations.--Not later than 
180 days after the issuance in final form of revisions to the Federal 
Acquisition Regulation pursuant to section 9002, the Comptroller 
General shall submit to Congress a report evaluating compliance with 
such section 9002.
    (b) Evaluation of Implementation of Regulations.--Not later than 18 
months after issuance in final form of revisions to the Federal 
Acquisition Regulation pursuant to section 9002, the Comptroller 
General shall submit to Congress a report evaluating the effectiveness 
of the regulations implementing this Act in streamlining the 
acquisition system and fulfilling the other purposes of this Act.
            Attest:






                                                                 Clerk.
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