[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 2515 Placed on Calendar Senate (PCS)]






                                                       Calendar No. 371
107th CONGRESS
  2d Session
                                S. 2515

     To authorize appropriations for fiscal year 2003 for military 
    activities of the Department of Defense, to prescribe personnel 
  strengths for such fiscal year for the Armed Forces, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                 May 15 (legislative day, May 9), 2002

Mr. Levin, from the Committee on Armed Services, reported the following 
     original bill; which was read twice and placed on the calendar

_______________________________________________________________________

                                 A BILL


 
     To authorize appropriations for fiscal year 2003 for military 
    activities of the Department of Defense, to prescribe personnel 
  strengths for such fiscal year for the Armed Forces, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Department of Defense Authorization 
Act for Fiscal Year 2003''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Congressional defense committees defined.
                          TITLE I--PROCUREMENT

              Subtitle A--Authorization of Appropriations

Sec. 101. Army.
Sec. 102. Navy and Marine Corps.
Sec. 103. Air Force.
Sec. 104. Defense-wide activities.
Sec. 105. Defense Inspector General.
Sec. 106. Chemical agents and munitions destruction, defense.
Sec. 107. Defense health programs.
                       Subtitle B--Army Programs

Sec. 111. Pilot program on sales of manufactured articles and services 
                            of certain Army industrial facilities 
                            without regard to availability from 
                            domestic sources.
                       Subtitle C--Navy Programs

                          (reserved)
                     Subtitle D--Air Force Programs

Sec. 131. C-130J aircraft program.
Sec. 132. Pathfinder programs.
Sec. 133. Oversight of acquisition for defense space programs.
Sec. 134. Leasing of tanker aircraft.
         TITLE II--RESEARCH, DEVELOPMENT, TEST, AND EVALUATION

              Subtitle A--Authorization of Appropriations

Sec. 201. Authorization of appropriations.
Sec. 202. Amount for science and technology.
Sec. 203. Defense health programs.
    Subtitle B--Program Requirements, Restrictions, and Limitations

Sec. 211. Basic seismic research program for support of national 
                            requirements for monitoring nuclear 
                            explosions.
Sec. 212. Advanced SEAL Delivery System.
Sec. 213. Army experimentation program regarding design of the 
                            objective force.
                  Subtitle C--Missile Defense Programs

Sec. 221. Annual operational assessments and reviews of ballistic 
                            missile defense program.
Sec. 222. Report on Midcourse Defense program.
Sec. 223. Report on Air-based Boost program.
Sec. 224. Report on Theater High Altitude Area Defense program.
Sec. 225. References to new name for Ballistic Missile Defense 
                            Organization.
   Subtitle D--Improved Management of Department of Defense Test and 
                         Evaluation Facilities

Sec. 231. Department of Defense Test and Evaluation Resource 
                            Enterprise.
Sec. 232. Transfer of testing funds from program accounts to 
                            infrastructure accounts.
Sec. 233. Increased investment in test and evaluation facilities.
Sec. 234. Uniform financial management system for Department of Defense 
                            test and evaluation facilities.
Sec. 235. Test and evaluation workforce improvements.
Sec. 236. Compliance with test and evaluation master plan requirements.
Sec. 237. Report on implementation of Defense Science Board 
                            recommendations.
                       Subtitle E--Other Matters

Sec. 241. Pilot programs for revitalizing Department of Defense 
                            laboratories.
Sec. 242. Technology transition initiative.
Sec. 243. Encouragement of small businesses and nontraditional defense 
                            contractors to submit proposals potentially 
                            beneficial for combating terrorism.
Sec. 244. Vehicle fuel cell program.
Sec. 245. Defense nanotechnology research and development program.
                  TITLE III--OPERATION AND MAINTENANCE

              Subtitle A--Authorization of Appropriations

Sec. 301. Operation and maintenance funding.
Sec. 302. Working capital funds.
Sec. 303. Armed Forces Retirement Home.
Sec. 304. Range Enhancement Initiative Fund.
                  Subtitle B--Environmental Provisions

Sec. 311. Enhancement of authority on cooperative agreements for 
                            environmental purposes.
Sec. 312. Modification of authority to carry out construction projects 
                            for environmental responses.
Sec. 313. Increased procurement of environmentally preferable products.
Sec. 314. Cleanup of unexploded ordnance on Kaho'olawe Island, Hawaii.
               Subtitle C--Defense Dependents' Education

Sec. 331. Assistance to local educational agencies that benefit 
                            dependents of members of the Armed Forces 
                            and Department of Defense civilian 
                            employees.
Sec. 332. Impact aid for children with severe disabilities.
Sec. 333. Options for funding dependent summer school programs.
Sec. 334. Comptroller General study of adequacy of compensation 
                            provided for teachers in the Department of 
                            Defense Overseas Dependents' Schools.
                       Subtitle D--Other Matters

Sec. 341. Use of humanitarian and civic assistance funds for reserve 
                            component members of Special Operations 
                            Command engaged in activities relating to 
                            clearance of landmines.
Sec. 342. Calculation of five-year period of limitation for Navy-Marine 
                            Corps intranet contract.
Sec. 343. Reimbursement for reserve component intelligence support.
Sec. 344. Clarification of core logistics capabilities.
Sec. 345. Rebate agreements under the special supplemental food 
                            program.
              TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS

                       Subtitle A--Active Forces

Sec. 401. End strengths for active forces.
Sec. 402. Authority to increase strength and grade limitations to 
                            account for reserve component members on 
                            active duty in support of a contingency 
                            operation.
Sec. 403. Increased allowance for number of Marine Corps general 
                            officers on active duty in grades above 
                            major general.
Sec. 404. Increase in authorized strengths for Marine Corps officers on 
                            active duty in the grade of colonel.
                       Subtitle B--Reserve Forces

Sec. 411. End strengths for Selected Reserve.
Sec. 412. End strengths for Reserves on active duty in support of the 
                            reserves.
Sec. 413. End strengths for military technicians (dual status).
Sec. 414. Fiscal year 2003 limitations on non-dual status technicians.
              Subtitle C--Authorization of Appropriations

Sec. 421. Authorization of appropriations for military personnel.
                   TITLE V--MILITARY PERSONNEL POLICY

                  Subtitle A--Officer Personnel Policy

Sec. 501. Extension of certain requirements and exclusions applicable 
                            to service of general and flag officers on 
                            active duty in certain joint duty 
                            assignments.
Sec. 502. Extension of authority to waive requirement for significant 
                            joint duty experience for appointment as a 
                            chief of a reserve component or a National 
                            Guard director.
             Subtitle B--Reserve Component Personnel Policy

Sec. 511. Time for commencement of initial period of active duty for 
                            training upon enlistment in reserve 
                            component.
Sec. 512. Authority for limited extension of medical deferment of 
                            mandatory retirement or separation of 
                            reserve component officer.
                   Subtitle C--Education and Training

Sec. 521. Increase in authorized strengths for the service academies.
           Subtitle D--Decorations, Awards, and Commendations

Sec. 531. Waiver of time limitations for award of certain decorations 
                            to certain persons.
Sec. 532. Korea Defense Service Medal.
                  Subtitle E--National Call to Service

Sec. 541. Enlistment incentives for pursuit of skills to facilitate 
                            national service.
Sec. 542. Military recruiter access to institutions of higher 
                            education.
                       Subtitle F--Other Matters

Sec. 551. Biennial surveys on racial, ethnic, and gender issues.
Sec. 552. Leave required to be taken pending review of a recommendation 
                            for removal by a board of inquiry.
Sec. 553. Stipend for participation in funeral honors details.
          TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS

                     Subtitle A--Pay and Allowances

Sec. 601. Increase in basic pay for fiscal year 2003.
Sec. 602. Rate of basic allowance for subsistence for enlisted 
                            personnel occupying single Government 
                            quarters without adequate availability of 
                            meals.
Sec. 603. Basic allowance for housing in cases of low-cost or no-cost 
                            moves.
           Subtitle B--Bonuses and Special and Incentive Pays

Sec. 611. One-year extension of certain bonus and special pay 
                            authorities for reserve forces.
Sec. 612. One-year extension of certain bonus and special pay 
                            authorities for certain health care 
                            professionals.
Sec. 613. One-year extension of special pay and bonus authorities for 
                            nuclear officers.
Sec. 614. One-year extension of other bonus and special pay 
                            authorities.
Sec. 615. Increased maximum amount payable as multiyear retention bonus 
                            for medical officers of the Armed Forces.
Sec. 616. Increased maximum amount payable as incentive special pay for 
                            medical officers of the Armed Forces.
Sec. 617. Assignment incentive pay.
Sec. 618. Increased maximum amounts for prior service enlistment bonus.
            Subtitle C--Travel and Transportation Allowances

Sec. 631. Deferral of travel in connection with leave between 
                            consecutive overseas tours.
Sec. 632. Transportation of motor vehicles for members reported 
                            missing.
Sec. 633. Destinations authorized for Government paid transportation of 
                            enlisted personnel for rest and 
                            recuperation upon extending duty at 
                            designated overseas locations.
Sec. 634. Vehicle storage in lieu of transportation to certain areas of 
                            the United States outside continental 
                            United States.
          Subtitle D--Retirement and Survivor Benefit Matters

Sec. 641. Phased-in authority for concurrent receipt of military 
                            retired pay and veterans' disability 
                            compensation for certain service-connected 
                            disabled veterans.
Sec. 642. Increased retired pay for enlisted Reserves credited with 
                            extraordinary heroism.
Sec. 643. Expanded scope of authority to waive time limitations on 
                            claims for military personnel benefits.
                       Subtitle E--Other Matters

Sec. 651. Additional authority to provide assistance for families of 
                            members of the Armed Forces.
Sec. 652. Time limitation for use of Montgomery GI Bill entitlement by 
                            members of the Selected Reserve.
Sec. 653. Status of obligation to refund educational assistance upon 
                            failure to participate satisfactorily in 
                            Selected Reserve.
Sec. 654. Prohibition on acceptance of honoraria by personnel at 
                            certain Department of Defense schools.
                         TITLE VII--HEALTH CARE

Sec. 701. Eligibility of surviving dependents for TRICARE dental 
                            program benefits after discontinuance of 
                            former enrollment.
Sec. 702. Advance authorization for inpatient mental health services.
Sec. 703. Continued TRICARE eligibility of dependents residing at 
                            remote locations after departure of 
                            sponsors for unaccompanied assignments.
Sec. 704. Approval of medicare providers as TRICARE providers.
Sec. 705. Claims information.
Sec. 706. Department of Defense Medicare-Eligible Retiree Health Care 
                            Fund.
Sec. 707. Technical corrections relating to transitional health care 
                            for members separated from active duty.
  TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED 
                                MATTERS

             Subtitle A--Major Defense Acquisition Programs

Sec. 801. Buy-to-budget acquisition of end items.
Sec. 802. Report to Congress on incremental acquisition of major 
                            systems.
Sec. 803. Pilot program for spiral development of major systems.
Sec. 804. Improvement of software acquisition processes.
Sec. 805. Independent technology readiness assessments.
Sec. 806. Timing of certification in connection with waiver of 
                            survivability and lethality testing 
                            requirements.
              Subtitle B--Procurement Policy Improvements

Sec. 811. Performance goals for contracting for services.
Sec. 812. Grants of exceptions to cost or pricing data certification 
                            requirements and waivers of cost accounting 
                            standards.
Sec. 813. Extension of requirement for annual report on defense 
                            commercial pricing management improvement.
Sec. 814. Internal controls on the use of purchase cards.
Sec. 815. Assessment regarding fees paid for acquisitions under other 
                            agencies' contracts.
Sec. 816. Pilot program for transition to follow-on contracts for 
                            certain prototype projects.
Sec. 817. Waiver authority for domestic source or content requirements.
                       Subtitle C--Other Matters

Sec. 821. Extension of the applicability of certain personnel 
                            demonstration project exceptions to an 
                            acquisition workforce demonstration 
                            project.
Sec. 822. Moratorium on reduction of the defense acquisition and 
                            support workforce.
Sec. 823. Extension of contract goal for small disadvantaged businesses 
                            and certain institutions of higher 
                            education.
Sec. 824. Mentor-Protege Program eligibility for HUBZone small business 
                            concerns and small business concerns owned 
                            and controlled by service-disabled 
                            veterans.
Sec. 825. Repeal of requirements for certain reviews by the Comptroller 
                            General.
Sec. 826. Multiyear procurement authority for purchase of dinitrogen 
                            tetroxide, hydrazine, and hydrazine-related 
                            products.
Sec. 827. Multiyear procurement authority for environmental services 
                            for military installations.
      TITLE IX--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT

Sec. 901. Time for submittal of report on Quadrennial Defense Review.
Sec. 902. Increased number of Deputy Commandants authorized for the 
                            Marine Corps.
Sec. 903. Base operating support for Fisher Houses.
Sec. 904. Prevention and mitigation of corrosion.
                      TITLE X--GENERAL PROVISIONS

                     Subtitle A--Financial Matters

Sec. 1001. Transfer authority.
Sec. 1002. Reallocation of authorizations of appropriations from 
                            ballistic missile defense to shipbuilding.
Sec. 1003. Authorization of appropriations for continued operations for 
                            the war on terrorism.
Sec. 1004. Authorization of emergency supplemental appropriations for 
                            fiscal year 2002.
Sec. 1005. United States contribution to NATO common-funded budgets in 
                            fiscal year 2003.
Sec. 1006. Development and implementation of financial management 
                            enterprise architecture.
Sec. 1007. Departmental accountable officials in the Department of 
                            Defense.
Sec. 1008. Department-wide procedures for establishing and liquidating 
                            personal pecuniary liability.
Sec. 1009. Travel card program integrity.
                Subtitle B--Naval Vessels and Shipyards

Sec. 1021. Number of Navy surface combatants in active and reserve 
                            service.
Sec. 1022. Plan for fielding the 155-millimeter gun on a surface 
                            combatant.
Sec. 1023. Report on initiatives to increase operational days of Navy 
                            ships.
                   Subtitle C--Reporting Requirements

Sec. 1031. Repeal and modification of various reporting requirements 
                            applicable with respect to the Department 
                            of Defense.
Sec. 1032. Annual report on weapons to defeat hardened and deeply 
                            buried targets.
Sec. 1033. Revision of date of annual report on counterproliferation 
                            activities and programs.
Sec. 1034. Quadrennial quality of life review.
                      Subtitle D--Homeland Defense

Sec. 1041. Homeland security activities of the National Guard.
Sec. 1042. Conditions for use of full-time Reserves to perform duties 
                            relating to defense against weapons of mass 
                            destruction.
Sec. 1043. Weapon of mass destruction defined for purposes of the 
                            authority for use of Reserves to perform 
                            duties relating to defense against weapons 
                            of mass destruction.
Sec. 1044. Report on Department of Defense homeland defense activities.
Sec. 1045. Strategy for improving preparedness of military 
                            installations for incidents involving 
                            weapons of mass destruction.
                       Subtitle E--Other Matters

Sec. 1061. Continued applicability of expiring Governmentwide 
                            information security requirements to the 
                            Department of Defense.
Sec. 1062. Acceptance of voluntary services of proctors for 
                            administration of Armed Services Vocational 
                            Aptitude Battery.
Sec. 1063. Extension of authority for Secretary of Defense to sell 
                            aircraft and aircraft parts for use in 
                            responding to oil spills.
Sec. 1064. Amendments to Impact Aid program.
       TITLE XI--DEPARTMENT OF DEFENSE CIVILIAN PERSONNEL POLICY

Sec. 1101. Extension of authority to pay severance pay in a lump sum.
Sec. 1102. Extension of voluntary separation incentive pay authority.
Sec. 1103. Extension of cost-sharing authority for continued FEHBP 
                            coverage of certain persons after 
                            separation from employment.
Sec. 1104. Eligibility of nonappropriated funds employees to 
                            participate in the Federal employees long-
                            term care insurance program.
Sec. 1105. Increased maximum period of appointment under the 
                            experimental personnel program for 
                            scientific and technical personnel.
Sec. 1106. Qualification requirements for employment in Department of 
                            Defense professional accounting positions.
Sec. 1107. Housing benefits for unaccompanied teachers required to live 
                            at Guantanamo Bay Naval Station, Cuba.
              TITLE XII--MATTERS RELATING TO OTHER NATIONS

  Subtitle A--Cooperative Threat Reduction With States of the Former 
                              Soviet Union

Sec. 1201. Specification of Cooperative Threat Reduction programs and 
                            funds.
Sec. 1202. Funding allocations.
Sec. 1203. Authorization of use of Cooperative Threat Reduction funds 
                            for projects and activities outside the 
                            former Soviet Union.
Sec. 1204. Waiver of limitations on assistance under programs to 
                            facilitate cooperative threat reduction and 
                            nonproliferation.
                       Subtitle B--Other Matters

Sec. 1211. Administrative support and services for coalition liaison 
                            officers.
Sec. 1212. Use of Warsaw Initiative funds for travel of officials from 
                            partner countries.
Sec. 1213. Support of United Nations-sponsored efforts to inspect and 
                            monitor Iraqi weapons activities.
Sec. 1214. Arctic and Western Pacific Environmental Cooperation 
                            Program.

SEC. 3. CONGRESSIONAL DEFENSE COMMITTEES DEFINED.

    For purposes of this Act, the term ``congressional defense 
committees'' means--
            (1) the Committee on Armed Services and the Committee on 
        Appropriations of the Senate; and
            (2) the Committee on Armed Services and the Committee on 
        Appropriations of the House of Representatives.

                          TITLE I--PROCUREMENT

              Subtitle A--Authorization of Appropriations

SEC. 101. ARMY.

    Funds are hereby authorized to be appropriated for fiscal year 2003 
for procurement for the Army as follows:
            (1) For aircraft, $2,146,386,000.
            (2) For missiles, $1,653,150,000.
            (3) For weapons and tracked combat vehicles, 
        $2,242,882,000.
            (4) For ammunition, $1,204,499,000.
            (5) For other procurement, $5,513,679,000.

SEC. 102. NAVY AND MARINE CORPS.

    (a) Navy.--Funds are hereby authorized to be appropriated for 
fiscal year 2003 for procurement for the Navy as follows:
            (1) For aircraft, $9,037,209,000.
            (2) For weapons, including missiles and torpedoes, 
        $2,505,820,000.
            (3) For shipbuilding and conversion, $8,624,160,000.
            (4) For other procurement, $4,516,500,000.
    (b) Marine Corps.--Funds are hereby authorized to be appropriated 
for fiscal year 2003 for procurement for the Marine Corps in the amount 
of $1,341,219,000.
    (c) Navy and Marine Corps Ammunition.--Funds are hereby authorized 
to be appropriated for fiscal year 2003 for procurement of ammunition 
for the Navy and the Marine Corps in the amount of $1,173,157,000.

SEC. 103. AIR FORCE.

    Funds are hereby authorized to be appropriated for fiscal year 2003 
for procurement for the Air Force as follows:
            (1) For aircraft, $12,613,605,000.
            (2) For ammunition, $1,275,864,000.
            (3) For missiles, $3,258,162,000.
            (4) For other procurement, $10,476,340,000.

SEC. 104. DEFENSE-WIDE ACTIVITIES.

    Funds are hereby authorized to be appropriated for fiscal year 2003 
for Defense-wide procurement in the amount of $3,054,943,000.

SEC. 105. DEFENSE INSPECTOR GENERAL.

    Funds are hereby authorized to be appropriated for fiscal year 2003 
for procurement for the Inspector General of the Department of Defense 
in the amount of $2,000,000.

SEC. 106. CHEMICAL AGENTS AND MUNITIONS DESTRUCTION, DEFENSE.

    There is hereby authorized to be appropriated for the Office of the 
Secretary of Defense for fiscal year 2003 the amount of $1,490,199,000 
for--
            (1) the destruction of lethal chemical agents and munitions 
        in accordance with section 1412 of the Department of Defense 
        Authorization Act, 1986 (50 U.S.C. 1521); and
            (2) the destruction of chemical warfare materiel of the 
        United States that is not covered by section 1412 of such Act.

SEC. 107. DEFENSE HEALTH PROGRAMS.

    Funds are hereby authorized to be appropriated for fiscal year 2003 
for the Department of Defense for procurement for carrying out health 
care programs, projects, and activities of the Department of Defense in 
the total amount of $278,742,000.

                       Subtitle B--Army Programs

SEC. 111. PILOT PROGRAM ON SALES OF MANUFACTURED ARTICLES AND SERVICES 
              OF CERTAIN ARMY INDUSTRIAL FACILITIES WITHOUT REGARD TO 
              AVAILABILITY FROM DOMESTIC SOURCES.

    (a) Extension of Program.--Subsection (a) of section 141 of the 
National Defense Authorization Act for Fiscal Year 1998 (Public Law 
105-85; 10 U.S.C. 4543 note) is amended by striking ``through 2002'' in 
the first sentence and inserting ``through 2004''.
    (b) Use of Overhead Funds Made Surplus by Sales.--Such section is 
further amended--
            (1) by redesignating subsection (c) as subsection (d); and
            (2) by inserting after subsection (b) the following new 
        subsection (c):
    ``(c) For each Army industrial facility participating in the pilot 
program that sells manufactured articles and services in a total amount 
in excess of $20,000,000 in any fiscal year, the amount equal to one-
half of one percent of such total amount shall be transferred from the 
sums in the Army Working Capital Fund for unutilized plant capacity to 
appropriations available for the following fiscal year for the 
demilitarization of conventional ammunition by the Army.''.
    (c) Update of Inspector General's Review.--The Inspector General of 
the Department of Defense shall review the experience under the pilot 
program carried out under section 141 of Public Law 105-85 and, not 
later than July 1, 2003, submit to Congress a report on the results of 
the review. The report shall contain the views, information, and 
recommendations called for under subsection (d) of such section (as 
redesignated by subsection (b)(1)). In carrying out the review and 
preparing the report, the Inspector General shall take into 
consideration the report submitted to Congress under such subsection 
(as so redesignated).

                       Subtitle C--Navy Programs

                               (reserved)

                     Subtitle D--Air Force Programs

SEC. 131. C-130J AIRCRAFT PROGRAM.

    (a) Multiyear Procurement Authority.--Beginning with the fiscal 
year 2003 program year, the Secretary of the Air Force may, in 
accordance with section 2306b of title 10, United States Code, enter 
into a multiyear contract for the procurement of C-130J aircraft and 
variants of the C-130J aircraft, subject to subsection (b).
    (b) Limitation.--The Secretary of the Air Force may not enter into 
a multiyear contract authorized by subsection (a) until the C-130J 
aircraft has been cleared for worldwide over-water capability.

SEC. 132. PATHFINDER PROGRAMS.

    (a) Spiral Development Plan for Selected Pathfinder Programs.--Not 
later than February 1, 2003, the Secretary of the Air Force shall--
            (1) identify among the pathfinder programs listed in 
        subsection (e) each pathfinder program that the Secretary shall 
        conduct as a spiral development program; and
            (2) submit to the Secretary of Defense for each pathfinder 
        program identified under paragraph (1) a spiral development 
        plan that meets the requirements of section 803(c).
    (b) Approval or Disapproval of Spiral Development Plans.--Not later 
than March 15, 2003, the Secretary of Defense shall--
            (1) review each spiral development plan submitted under 
        subsection (a)(2);
            (2) approve or disapprove the conduct as a spiral 
        development plan of the pathfinder program covered by each such 
        spiral development plan; and
            (3) submit to the congressional defense committees a copy 
        of each spiral development plan approved under paragraph (2).
    (c) Assessment of Pathfinder Programs Not Selected or Approved for 
Spiral Development.--Not later than March 15, 2003, each official of 
the Department of Defense specified in subsection (d) shall submit to 
the congressional defense committees the assessment required of such 
official under that subsection for the acquisition plan for each 
pathfinder program as follows:
            (1) Each pathfinder program that is not identified by the 
        Secretary of the Air Force under subsection (a)(1) as a program 
        that the Secretary shall conduct as a spiral development 
        program.
            (2) Each pathfinder program that is disapproved by the 
        Secretary of Defense for conduct as a spiral development 
        program under subsection (b)(2).
    (d) Officials and Required Assessments for Programs Outside Spiral 
Development.--The officials specified in this subsection, and the 
assessment required of such officials, are as follows:
            (1) The Director of Operational Test and Evaluation, who 
        shall assess the test contents of the acquisition plan for each 
        pathfinder program covered by subsection (c).
            (2) The Chairman of the Joint Requirements Oversight 
        Council, who shall assess the extent to which the acquisition 
        plan for each such pathfinder program addresses validated 
        military requirements.
            (3) The Under Secretary of Defense (Comptroller), in 
        coordination with the Under Secretary of Defense for 
        Acquisition, Technology, and Logistics, who shall conduct an 
        independent programmatic evaluation of the acquisition plan for 
        each such pathfinder program, including an analysis of the 
        total cost, schedule, and technical risk associated with 
        development of such program.
    (e) Pathfinder Programs.--The pathfinder programs listed in this 
subsection are the program as follows:
            (1) Space Based Radar.
            (2) Global Positioning System.
            (3) Global Hawk.
            (4) Combat Search and Rescue.
            (5) B-2 Radar.
            (6) Predator B.
            (7) B-1 Defensive System Upgrade.
            (8) Multi Mission Command and Control Constellation.
            (9) Unmanned Combat Air Vehicle.
            (10) Global Transportation Network.
            (11) C-5 Avionics Modernization Program.
            (12) Hunter/Killer.
            (13) Tanker/Lease.
            (14) Small Diameter Bomb.
            (15) KC-767.
            (16) AC-130 Gunship.

SEC. 133. OVERSIGHT OF ACQUISITION FOR DEFENSE SPACE PROGRAMS.

    (a) In General.--The Office of the Secretary of Defense shall 
maintain oversight of acquisition for defense space programs.
    (b) Report on Oversight.--(1) Not later than March 15, 2003, the 
Secretary of Defense shall submit to the congressional defense 
committees a detailed plan on how the Office of the Secretary of 
Defense shall provide oversight of acquisition for defense space 
programs.
    (2) The plan shall set forth the following:
            (A) The organizations in the Office of the Secretary of 
        Defense, and the Joint Staff organizations, to be involved in 
        oversight of acquisition for defense space programs.
            (B) The process for the review of defense space programs by 
        the organizations specified under subparagraph (A).
            (C) The process for the provision by such organizations of 
        technical, programmatic, scheduling, and budgetary advice on 
        defense space programs to the Deputy Secretary of Defense and 
        the Under Secretary of the Air Force.
            (D) The process for the development of independent cost 
        estimates for defense space programs, including the 
        organization responsible for developing such cost estimates and 
        when such cost estimates shall be required.
            (E) The process for the development of the budget for 
        acquisition for defense space programs.
            (F) The process for the resolution of issues regarding 
        acquisition for defense space programs that are raised by the 
        organizations specified under subparagraph (A).
    (c) Defense Space Program Defined.--In this section, the term 
``defense space program'' means any major defense acquisition program 
(as that term is defined in section 2430 of title 10, United States 
Code) for the acquisition of--
            (1) space-based assets, space launch assets, or user 
        equipment for such assets; or
            (2) earth-based or spaced-based assets dedicated primarily 
        to space surveillance or space control.

SEC. 134. LEASING OF TANKER AIRCRAFT.

    The Secretary of the Air Force shall not enter into any lease for 
tanker aircraft until the Secretary submits the report required by 
section 8159(c)(6) of the Department of Defense Appropriations Act, 
2002 (division A of Public Law 107-117; 115 Stat. 2284) and obtains 
authorization and appropriation of funds necessary to enter into a 
lease for such aircraft consistent with his publicly stated commitments 
to the Congress to do so.

         TITLE II--RESEARCH, DEVELOPMENT, TEST, AND EVALUATION

              Subtitle A--Authorization of Appropriations

SEC. 201. AUTHORIZATION OF APPROPRIATIONS.

    Funds are hereby authorized to be appropriated for fiscal year 2003 
for the use of the Department of Defense for research, development, 
test, and evaluation as follows:
            (1) For the Army, $7,300,533,000.
            (2) For the Navy, $12,929,135,000.
            (3) For the Air Force, $18,603,684,000.
            (4) For Defense-wide activities, $17,542,927,000, of which 
        $361,554,000 is authorized for the Director of Operational Test 
        and Evaluation.

SEC. 202. AMOUNT FOR SCIENCE AND TECHNOLOGY.

    (a) Amount for Projects.--Of the total amount authorized to be 
appropriated by section 201, $10,164,358,000 shall be available for 
science and technology projects.
    (b) Science and Technology Defined.--In this section, the term 
``science and technology project'' means work funded in program 
elements for defense research, development, test, and evaluation under 
Department of Defense budget activities 1, 2, or 3.

SEC. 203. DEFENSE HEALTH PROGRAMS.

    Funds are hereby authorized to be appropriated for fiscal year 2003 
for the Department of Defense for research, development, test, and 
evaluation for carrying out health care programs, projects, and 
activities of the Department of Defense in the total amount of 
$67,214,000.

    Subtitle B--Program Requirements, Restrictions, and Limitations

SEC. 211. BASIC SEISMIC RESEARCH PROGRAM FOR SUPPORT OF NATIONAL 
              REQUIREMENTS FOR MONITORING NUCLEAR EXPLOSIONS.

    (a) Management of Program.--(1) The Secretary of the Air Force 
shall manage the Department of Defense program of basic seismic 
research in support of national requirements for monitoring nuclear 
explosions. The Secretary shall manage the program in the manner 
necessary to support Air Force mission requirements relating to the 
national requirements.
    (2) The Secretary shall act through the Director of the Air Force 
Research Laboratory in carrying out paragraph (1).
    (b) Amount for Program.--Of the amount authorized to be 
appropriated by section 201(4), $20,000,000 shall be available for the 
program referred to in subsection (a).

SEC. 212. ADVANCED SEAL DELIVERY SYSTEM.

    To the extent provided in appropriations Acts, the Secretary of 
Defense may use for research, development, test, and evaluation for the 
Advanced SEAL Delivery System any funds that were authorized to be 
appropriated to the Department of Defense for fiscal year 2002 for the 
procurement of that system, were appropriated pursuant to such 
authorization of appropriations, and are no longer needed for that 
purpose.

SEC. 213. ARMY EXPERIMENTATION PROGRAM REGARDING DESIGN OF THE 
              OBJECTIVE FORCE.

    (a) Requirement for Report.--Not later than March 30, 2003, the 
Secretary of the Army shall submit to Congress a report on the 
experimentation program regarding design of the objective force that is 
required by subsection (g) of section 113 of the Floyd D. Spence 
National Defense Authorization Act for Fiscal Year 2001, as added by 
section 113 of the National Defense Authorization Act for Fiscal Year 
2002 (Public Law 107-107; 115 Stat. 1029).
    (b) Budget Display.--Amounts provided for the experimentation 
program in the budget for fiscal year 2004 that is submitted to 
Congress under section 1105(a) of title 31, United States Code, shall 
be displayed as a distinct program element in that budget and in the 
supporting documentation submitted to Congress by the Secretary of 
Defense.

                  Subtitle C--Missile Defense Programs

SEC. 221. ANNUAL OPERATIONAL ASSESSMENTS AND REVIEWS OF BALLISTIC 
              MISSILE DEFENSE PROGRAM.

    (a) Annual Operational Assessment.--(1)(A) During the first quarter 
of each fiscal year, the Director of Operational Test and Evaluation 
shall conduct an operational assessment of the missile defense programs 
listed in paragraph (3).
    (B) The annual assessment shall include--
            (i) a detailed, quantitative evaluation of the potential 
        operational effectiveness, reliability, and suitability of the 
        system or systems under each program as the program exists 
        during the fiscal year of the assessment;
            (ii) an evaluation of the adequacy of testing through the 
        end of the previous fiscal year to measure and predict the 
        effectiveness of the systems; and
            (iii) a determination of the threats, or type of threats, 
        against which the systems would be expected to be effective and 
        those against which the systems would not be expected to be 
        effective.
    (C) The first assessment under this paragraph shall be conducted 
during fiscal year 2003.
    (2) Not later than January 15 of each year, the Director of 
Operational Test and Evaluation shall submit to the Secretary of 
Defense and the congressional defense committees a report on the 
assessment conducted during the preceding quarter-year. The report 
shall include the evaluation of the potential of the system or systems 
together with a discussion of the basis for the evaluation.
    (3) The requirement for an annual operational assessment under 
paragraph (1) shall apply to programs under the United States Missile 
Defense Agency as follows:
            (A) The Ground-based Midcourse Defense program.
            (B) The Sea-based Midcourse Defense program.
            (C) The Theater High Altitude Area Defense (THAAD) program.
            (D) The Air-based Boost program (formerly known as the 
        Airborne Laser Defense program).
    (b) Annual Requirements Reviews.--(1) During the first quarter of 
each fiscal year, the Joint Requirements Oversight Council established 
under section 181 of title 10, United States Code, shall review the 
cost, schedule, and performance criteria for the missile defense 
programs under the United States Missile Defense Agency and assess the 
validity of the criteria in relation to military requirements. The 
first review shall be carried out in fiscal year 2003.
    (2) Not later than January 15 of each year, the Chairman of the 
Joint Requirements Oversight Council shall submit to the Secretary of 
Defense and the congressional defense committees a report on the 
results of the review carried out under paragraph (1) during the 
preceding quarter-year.

SEC. 222. REPORT ON MIDCOURSE DEFENSE PROGRAM.

    (a) Requirement for Report.--Not later than January 15, 2003, the 
Secretary of Defense shall submit to the congressional defense 
committees a report on the Midcourse Defense program of the United 
States Missile Defense Agency. The report shall include the following 
information:
            (1) The development schedule, together with an estimate of 
        the annual costs through the completion of development.
            (2) The planned procurement schedule, together with the 
        Secretary's best estimates of the annual  costs of, and number 
of units to be procured under, the program through the completion of 
the procurement.
            (3) The current program acquisition unit cost and the 
        history of acquisition unit costs from the date the program 
        (including its antecedent program) was first included in a 
        Selected Acquisition Report under section 2432 of title 10, 
        United States Code.
            (4) The current procurement unit cost, and the history of 
        procurement unit costs from the date the program (including any 
        antecedent program) was first included in a Selected 
        Acquisition Report under such section 2432.
            (5) The reasons for any changes in program acquisition 
        cost, program acquisition unit cost, procurement cost, or 
        procurement unit cost, and the reasons for any changes in 
        program schedule.
            (6) The major contracts under the program and the reasons 
        for any changes in cost or schedule variances under the 
        contracts.
            (7) The Test and Evaluation Master Plan developed for the 
        program in accordance with the requirements and guidance of 
        Department of Defense regulation 5000.2-R.
    (b) Segregation of Ground-Based and Sea-Based Efforts.--The report 
under subsection (a) shall separately display the schedules, cost 
estimates, cost histories, contracts, and test plans for--
            (1) the National Missile Defense/Ground-based Midcourse 
        Defense program; and
            (2) the Navy TheaterWide/Sea-based Midcourse Defense 
        program.

SEC. 223. REPORT ON AIR-BASED BOOST PROGRAM.

    Not later than January 15, 2003, the Secretary of Defense shall 
submit to the congressional defense committees a report on the Air-
based Boost program (formerly known as the Airborne Laser program). The 
report shall contain the following information:
            (1) The development schedule together with the estimated 
        annual costs of the program through the completion of 
        development.
            (2) The planned procurement schedule, together with the 
        Secretary's best estimates of the annual costs of, and number 
        of units to be procured under, the program through the 
        completion of the procurement.
            (3) The current program acquisition unit cost, and the 
        history of program acquisition unit costs from the date the 
        program (including any antecedent program) was first included 
        in a Selected Acquisition Report under section 2432 of title 
        10, United States Code.
            (4) The current procurement unit cost, and the history of 
        procurement unit costs from the date the program (including any 
        antecedent program) was first included in a Selected 
        Acquisition Report under such section 2432.
            (5) The reasons for any changes in program acquisition 
        cost, program acquisition unit cost, procurement cost, or 
        procurement unit cost, and the reasons for any changes in 
        program schedule.
            (6) The major contracts under the program and the reasons 
        for any changes in cost or schedule variances under the 
        contracts.
            (7) The Test and Evaluation Master Plan developed for the 
        program in accordance with the requirements and guidance of 
        Department of Defense regulation 5000.2-R.

SEC. 224. REPORT ON THEATER HIGH ALTITUDE AREA DEFENSE PROGRAM.

    (a) Requirement for Report.--Not later than January 15, 2003, the 
Secretary of Defense shall submit to the congressional defense 
committees a report on the Theater High Altitude Area Defense program. 
The report shall contain the following information:
            (1) The development schedule together with the estimated 
        annual costs of the program through the completion of 
        development.
            (2) The planned procurement schedule, together with the 
        Secretary's best estimates of the annual costs of, and number 
        of units to be procured under, the program through the 
        completion of the procurement.
            (3) The current program acquisition unit cost and the 
        history of program acquisition unit costs from the date the 
        program (including any antecedent program) was first included 
        in a Selected Acquisition Report under section 2432 of title 
        10, United States Code.
            (4) The current procurement unit cost, and the history of 
        procurement unit costs from the date the program (including any 
        antecedent program) was first included in a Selected 
        Acquisition Report under such section 2432.
            (5) The reasons for any changes in program acquisition 
        cost, program acquisition unit cost, procurement cost, or 
        procurement unit cost, and the reasons for any changes in 
        program schedule.
            (6) The major contracts under the program and the reasons 
        for any changes in cost or schedule variances under the 
        contracts.
            (7) The Test and Evaluation Master Plan developed for the 
        program in accordance with the requirements and guidance of 
        Department of Defense regulation 5000.2-R.
    (b) Funding Limitation.--Not more than 50 percent of the amount 
authorized to be appropriated by this Act for the United States Missile 
Defense Agency for the Theater High Altitude Area Defense program may 
be expended until the submission of the report required under 
subsection (a).

SEC. 225. REFERENCES TO NEW NAME FOR BALLISTIC MISSILE DEFENSE 
              ORGANIZATION.

    (a) Conforming Amendments.--The following provisions of law are 
amended by striking ``Ballistic Missile Defense Organization'' each 
place it appears and inserting ``United States Missile Defense 
Agency'':
            (1) Sections 223 and 224 of title 10, United States Code.
            (2) Sections 232, 233, and 235 of the National Defense 
        Authorization Act for Fiscal Year 2002 (Public Law 107-107).
    (b) Other References.--Any reference to the Ballistic Missile 
Defense Organization in any other provision of law or in any 
regulation, map, document, record, or other paper of the United States 
shall be considered to be a reference to the United States Missile 
Defense Agency.

   Subtitle D--Improved Management of Department of Defense Test and 
                         Evaluation Facilities

SEC. 231. DEPARTMENT OF DEFENSE TEST AND EVALUATION RESOURCE 
              ENTERPRISE.

    (a) Establishment.--Section 139 of title 10, United States Code, is 
amended by adding at the end the following new subsection:
    ``(k)(1) There is a Test and Evaluation Resource Enterprise within 
the Department of Defense. The head of the Test and Evaluation Resource 
Enterprise shall report to the Director of Operational Test and 
Evaluation.
    ``(2)(A) The head of the Test and Evaluation Resource Enterprise 
shall manage all funds available to the Department of Defense for the 
support of investment in, operation and maintenance of, development of, 
and management of the test and evaluation facilities and resources of 
the Major Range and Test Facility Base. All such funds shall be 
transferred to and placed under the control of the head of the 
Department of Defense Test and Evaluation Resource Enterprise.
    ``(B) Subparagraph (A) shall not be construed to authorize the head 
of the Test and Evaluation Enterprise, nor to impair the authority of 
the Secretary of a military department, to manage the funds available 
to that military department for the support of investment in, operation 
and maintenance of, development of, and management of the training 
facilities and resources of the Major Range and Test Facility Base.
    ``(3) The head of the Test and Evaluation Resource Enterprise 
shall--
            ``(A) ensure that the planning for and execution of the 
        testing of a system within the Major Range and Test Facility 
        Base is performed by the activity of a military department that 
        is responsible for the testing;
            ``(B) ensure that the military department operating a 
        facility or resource within the Major Range and Test Facility 
        Base charges an organization using the facility or resource for 
        testing only the incremental cost of the operation of the 
        facility or resource that is attributable to the testing;
            ``(C) ensure that the military department operating a 
        facility or resource within the Major Range and Test Facility 
        Base comprehensively and consistently applies sound enterprise 
        management practices in the management of the facility or 
        resource;
            ``(D) make investments that are prudent for ensuring that 
        Department of Defense test and evaluation facilities and 
        resources are adequate to meet the current and future testing 
        requirements of Department of Defense programs;
            ``(E) ensure that there is in place a simplified financial 
        management and accounting system for Department of Defense test 
        and evaluation facilities and resources and that the system is 
        uniformly applied to the operation of such facilities and 
        resources throughout the Department; and
            ``(F) ensure that unnecessary costs of owning and operating 
        Department of Defense test and evaluation resources are not 
        incurred.
    ``(4) In this section, the term `Major Range and Test Facility 
Base' means the test and evaluation facilities and resources that are 
designated by the Under Secretary of Defense for Acquisition, 
Logistics, and Technology as facilities and resources comprising the 
Major Range and Test Facility Base.''.
    (b) Effective Date and Transition Requirements.--(1) The amendment 
made by paragraph (1) shall take effect one year after the date of the 
enactment of this Act.
    (2)(A) The Secretary of Defense shall develop a transition plan to 
ensure that the head of the Test and Evaluation Resource Enterprise is 
prepared to assume the responsibilities under subsection (k) of section 
139 of title  10, United States Code (as added by subsection (a)), on 
the effective date provided in paragraph (1).
    (B) Until the Test and Evaluation Resource Enterprise has been 
established, all investments of $500,000 or more in the Major Range and 
Test Facility Base of the Department of Defense shall be subject to the 
approval of the Director of Operational Test and Evaluation.
    (C) In this paragraph, the term ``Major Range and Test Facility 
Base'' has the meaning given that term in section 139(k)(4) of title 
10, United States Code, as added by subsection (a).

SEC. 232. TRANSFER OF TESTING FUNDS FROM PROGRAM ACCOUNTS TO 
              INFRASTRUCTURE ACCOUNTS.

    (a) Transfer of Funds.--Notwithstanding any other provision of this 
Act, amounts authorized to be appropriated by this title for 
demonstration and validation, engineering and manufacturing 
development, and operational systems development shall be transferred 
to the major test and evaluation investment programs of the military 
departments and to the Central Test and Evaluation Investment Program 
of the Department of Defense, as follows:
            (1) For transfer to the major test and evaluation 
        investment program of the Army, the amount equal to 0.625 
        percent of the total amount authorized to be appropriated by 
        this title for the Army for demonstration and validation, 
        engineering and manufacturing development, and operational 
        systems development.
            (2) For transfer to the major test and evaluation 
        investment program of the Navy, the amount equal to 0.625 
        percent of the total amount authorized to be appropriated by 
        this title for the Navy for demonstration and validation, 
        engineering and manufacturing development, and operational 
        systems development.
            (3) For transfer to the major test and evaluation 
        investment program of the Air Force, the amount equal to 0.625 
        percent of the total amount authorized to be appropriated by 
        this title for the Air Force for demonstration and validation, 
        engineering and manufacturing development, and operational 
        systems development.
            (4) For transfer to the Central Test and Evaluation 
        Investment Program of the Department of Defense, the amount 
        equal to 0.625 percent of the total amount authorized to be 
        appropriated by this title for Defense-wide demonstration and 
        validation, engineering and manufacturing development, and 
        operational systems development.
    (b) Institutional Funding of Test and Evaluation Facilities.--
(1)(A) Chapter 433 of title 10, United States Code, is amended by 
inserting after the table of sections at the beginning of such chapter 
the following new section:
``Sec. 4531. Test and evaluation: use of facilities
    ``(a) Charges for Use.--The Secretary of the Army may charge an 
entity for using a facility or resource of the Army within the Major 
Range and Test Facility Base for testing. The amount charged may not 
exceed the incremental cost to the Army of the use of the facility or 
resource by that user for the testing.
    ``(b) Institutional and Overhead Costs.--The institutional and 
overhead costs of a facility or resource of the Army that is within the 
Major Range and Test Facility Base shall be paid out of the major test 
and evaluation investment accounts of the Army, the Central Test and 
Evaluation Investment Program of the Department of Defense, and other 
appropriate appropriations made directly to the Army.
    ``(c) Major Range and Test Facility Base Defined.--In this section:
            ``(1) The term `Major Range and Test Facility Base' has the 
        meaning given the term in section 139(k)(4) of this title.
            ``(2) The term `institutional and overhead costs', with 
        respect to a facility or resource within the Major Range Test 
        and Facility Base--
                    ``(A) means the costs of maintaining, operating, 
                upgrading, and modernizing the facility or resource; 
                and
                    ``(B) does not include an incremental cost of 
                operating the facility or resource that is attributable 
                to the use of the facility or resource for testing 
                under a particular program.''.
    (B) The table of section at the beginning of such chapter is 
amended by inserting before the item relating to section 7522 the 
following new item:

``4531. Test and evaluation: use of facilities.''.
    (2)(A) Chapter 643 of title 10, United States Code, is amended by 
inserting after the table of sections at the beginning of such chapter 
the following new section:
``Sec. 7521. Test and evaluation: use of facilities
    ``(a) Charges for Use.--The Secretary of the Navy may charge an 
entity for using a facility or resource of the Navy within the Major 
Range and Test Facility Base for testing. The amount charged may not 
exceed the incremental cost to the Navy of the use of the facility or 
resource by that user for the testing.
    ``(b) Institutional and Overhead Costs.--The institutional and 
overhead costs of a facility or resource of the Navy that is within the 
Major Range and Test Facility Base shall be paid out of the major test 
and evaluation investment accounts of the Navy, the Central Test and 
Evaluation Investment Program of the Department of Defense, and other 
appropriate appropriations made directly to the Navy.
    ``(c) Major Range and Test Facility Base Defined.--In this section:
            ``(1) The term `Major Range and Test Facility Base' has the 
        meaning given the term in section 139(k)(4) of this title.
            ``(2) The term `institutional and overhead costs', with 
        respect to a facility or resource within the Major Range Test 
        and Facility Base--
                    ``(A) means the costs of maintaining, operating, 
                upgrading, and modernizing the facility or resource; 
                and
                    ``(B) does not include an incremental cost of 
                operating the facility or resource that is attributable 
                to the use of the facility or resource for testing 
                under a particular program.''.
    (B) The table of section at the beginning of such chapter is 
amended by inserting before the item relating to section 7522 the 
following new item:

``7521. Test and evaluation: use of facilities.''.
    (3)(A) Chapter 933 of title 10, United States Code, is amended by 
inserting after the table of sections at the beginning of such chapter 
the following new section:
``Sec. 9531. Test and evaluation: use of facilities
    ``(a) Charges for Use.--The Secretary of the Air Force may charge 
an entity for using a facility or resource of the Air Force within the 
Major Range and Test Facility Base for testing. The amount charged may 
not exceed the incremental cost to the Air Force of the use of the 
facility or resource by that user for the testing.
    ``(b) Institutional and Overhead Costs.--The institutional and 
overhead costs of a facility or resource of the Air Force that is 
within the Major Range and Test Facility Base shall be paid out of the 
major test and evaluation investment accounts of the Air Force, the 
Central Test and Evaluation Investment Program of the Department of 
Defense, and other appropriate appropriations made directly to the Air 
Force.
    ``(c) Major Range and Test Facility Base Defined.--In this section:
            ``(1) The term `Major Range and Test Facility Base' has the 
        meaning given the term in section 139(k)(4) of this title.
            ``(2) The term `institutional and overhead costs', with 
        respect to a facility or resource within the Major Range Test 
        and Facility Base--
                    ``(A) means the costs of maintaining, operating, 
                upgrading, and modernizing the facility or resource; 
                and
                    ``(B) does not include an incremental cost of 
                operating the facility or resource that is attributable 
                to the use of the facility or resource for testing 
                under a particular program.''.
    (B) The table of section at the beginning of such chapter is 
amended by inserting before the item relating to section 9532 the 
following new item:

``9531. Test and evaluation: use of facilities.''.
    (4) Not later than 30 days after the date of the enactment of this 
Act, the Under Secretary of Defense (Comptroller) shall review the 
funding policies of each military department to ensure that the 
Secretary of the military department has in place the policies 
necessary to comply with the Secretary's responsibilities under section 
4531, 7521, or 9531 of title 10, United States Code (as added by this 
subsection), as the case may be. The Under Secretary shall consult with 
the Director of Operational Test and Evaluation in carrying out the 
review.

SEC. 233. INCREASED INVESTMENT IN TEST AND EVALUATION FACILITIES.

    (a) Amount.--Of the amount authorized to be appropriated under 
section 201(4), $251,276,000 shall be available for the Central Test 
and Evaluation Investment Program of the Department of Defense.
    (b) Additional Available Funding.--In addition to the amount made 
available under subsection (a), amounts transferred pursuant to section 
232(a)(4) shall be available for the Central Test and Evaluation 
Investment Program of the Department of Defense.

SEC. 234. UNIFORM FINANCIAL MANAGEMENT SYSTEM FOR DEPARTMENT OF DEFENSE 
              TEST AND EVALUATION FACILITIES.

    (a) Requirement for System.--Not later than two years after the 
date of the enactment of this Act, the Secretary of Defense shall 
implement a single financial management and accounting system for all 
test and evaluation facilities of the Department of Defense.
    (b) System Features.--The financial management and accounting 
system shall be designed to achieve, at a minimum, the following 
functional objectives:
            (1) Enable managers within the Department of Defense to 
        compare the costs of conducting test and evaluation activities 
        in the various facilities of the military departments.
            (2) Enable the Secretary of Defense--
                    (A) to make prudent investment decisions; and
                    (B) to reduce the extent to which unnecessary costs 
                of owning and operating Department of Defense test and 
                evaluation facilities are incurred.
            (3) Enable the Department of Defense to track the total 
        cost of test and evaluation activities.
            (4) Comply with the financial management enterprise 
        architecture developed by the Secretary of Defense under 
        section 1006.

SEC. 235. TEST AND EVALUATION WORKFORCE IMPROVEMENTS.

    (a) Report on Capabilities.--Not later than March 15, 2003, the 
Under Secretary of Defense for Acquisition, Technology, and Logistics 
shall submit to Congress a report on the capabilities of the test and 
evaluation workforce of the Department of Defense. The Under Secretary 
shall consult with the Director of Operational Test and Evaluation in 
preparing the report.
    (b) Requirement for Plan.--(1) The report shall contain a plan for 
taking the actions necessary to ensure that the test and evaluation 
workforce of the Department of Defense is of sufficient size and has 
the expertise necessary to timely and accurately identify issues of 
military suitability and effectiveness of Department of Defense systems 
through testing of the systems.
    (2) The plan shall set forth objectives for the size, composition, 
and qualifications of the workforce, and shall specify the actions 
(including recruitment, retention, and training) and milestones for 
achieving the objectives.
    (c) Additional Matters.--The report shall also include the 
following matters:
            (1) An assessment of the changing size and demographics of 
        the test and evaluation workforce, including the impact of 
        anticipated retirements among the most experienced personnel 
        over the five-year period beginning with 2003, together with a 
        discussion of the management actions necessary to address the 
        changes.
            (2) An assessment of the anticipated workloads and 
        responsibilities of the test and evaluation workforce over the 
        ten-year period beginning with 2003, together with the number 
        and qualifications of military and civilian personnel necessary 
        to carry out such workloads and responsibilities.
            (3) The Secretary's specific plans for using the 
        demonstration authority provided in section 4308 of the 
        National Defense Authorization Act for Fiscal Year 1996 (Public 
Law 104-106; 10 U.S.C. 1701 note) and other special personnel 
management authorities of the Secretary to attract and retain qualified 
personnel in the test and evaluation workforce.
            (4) Any recommended legislation or additional special 
        authority that the Secretary considers appropriate for 
        facilitating the recruitment and retention of qualified 
        personnel for the test and evaluation workforce.
            (5) Any other matters that are relevant to the capabilities 
        of the test and evaluation workforce.

SEC. 236. COMPLIANCE WITH TEST AND EVALUATION MASTER PLAN REQUIREMENTS.

    (a) In General.--Chapter 139 of title 10, United States Code, is 
amended by inserting after section 2364 the following new section 2365:
``Sec. 2365. Test and evaluation: general requirements
    ``(a) Compliance With Test and Evaluation Master Plan.--The testing 
and evaluation of a system shall comply with the requirements of the 
test and evaluation master plan applicable to the system, except as 
provided in subsection (b).
    ``(b) Deviations.--(1) The test and evaluation of a system may 
deviate from the requirements of an applicable test and evaluation 
master plan if--
            ``(A) the deviation is agreed upon in accordance with the 
        same procedures pursuant to which the plan was established, 
        including the procedure for approval by the Director of 
        Operational Test and Evaluation; or
            ``(B) the Secretary of Defense approves the deviation.
    ``(2) The authority of the Secretary of Defense to approve a 
deviation for the purposes of paragraph (1)(B) may not be delegated to 
any official other than the Deputy Secretary of Defense.
    ``(c) Notifications of Congress.--(1) The Secretary of Defense 
shall notify the Committees on Armed Services and on Appropriations of 
the Senate and the Committees on Armed Services and on Appropriations 
of the House of Representatives of any decision to authorize a 
deviation under subsection (b).
    ``(2) A notification of a deviation under paragraph (1) shall be 
made not later than 30 days after the date on which the deviation is 
authorized. The notification shall include a description of each 
requirement covered by the authorized deviation, together with the 
reasons for the deviation.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by inserting after the item relating to section 
2364 the following new item:

``2365. Test and evaluation: general requirements.''.

SEC. 237. REPORT ON IMPLEMENTATION OF DEFENSE SCIENCE BOARD 
              RECOMMENDATIONS.

    (a) Requirement.--Not later than March 1, 2003, the Secretary of 
Defense shall submit to the congressional defense committees a report 
on the extent of the implementation of the recommendations set forth in 
the December 2000 Report of the Defense Science Board Task Force on 
Test and Evaluation Capabilities.
    (b) Content.--The report shall include the following:
            (1) For each recommendation that is being implemented or 
        that the Secretary plans to implement--
                    (A) a summary of all actions that have been taken 
                to implement the recommendation; and
                    (B) a schedule, with specific milestones, for 
                completing the implementation of the recommendation.
            (2) For each recommendation that the Secretary does not 
        plan to implement--
                    (A) the reasons for the decision not to implement 
                the recommendation; and
                    (B) a summary of any alternative actions the 
                Secretary plans to take to address the purposes 
                underlying the recommendation.
            (3) A summary of any additional actions the Secretary plans 
        to take to address concerns raised in the December 2000 Report 
        of the Defense Science Board Task Force on Test and Evaluation 
        Capabilities about the state of the test and evaluation 
        infrastructure of the Department of Defense.

                       Subtitle E--Other Matters

SEC. 241. PILOT PROGRAMS FOR REVITALIZING DEPARTMENT OF DEFENSE 
              LABORATORIES.

    (a) Additional Pilot Program.--(1) The Secretary of Defense may 
carry out a pilot program to demonstrate improved efficiency in the 
performance of research, development, test, and evaluation functions of 
the Department of Defense.
    (2) Under the pilot program, the Secretary of Defense shall provide 
the director of one science and technology laboratory, and the director 
of one test and evaluation laboratory, of each military department with 
authority for the following:
            (A) To use innovative methods of personnel management 
        appropriate for ensuring that the selected laboratories can--
                    (i) employ and retain a workforce appropriately 
                balanced between permanent and temporary personnel and 
                among workers with appropriate levels of skills and 
                experience; and
                    (ii) effectively shape workforces to ensure that 
                the workforces have the necessary sets of skills and 
                experience to fulfill their organizational missions.
            (B) To develop or expand innovative methods of entering 
        into and expanding cooperative relationships and arrangements 
        with private sector organizations, educational institutions 
        (including primary and secondary schools), and State and local 
        governments to facilitate the training of a future scientific 
        and technical workforce that will contribute significantly to 
        the accomplishment of organizational missions.
            (C) To develop or expand innovative methods of establishing 
        cooperative relationships and arrangements with private sector 
        organizations and educational institutions to promote the 
        establishment of the technological industrial base in areas 
        critical for Department of Defense technological requirements.
            (D) To waive any restrictions not required by law that 
        apply to the demonstration and implementation of methods for 
        achieving the objectives set forth in subparagraphs (A), (B), 
        and (C).
    (3) The Secretary may carry out the pilot program under this 
subsection at each selected laboratory for a period of three years 
beginning not later than March 1, 2003.
    (b) Relationship to Fiscal Years 1999 and 2000 Revitalization Pilot 
Programs.--The pilot program under this section is in addition to, but 
may be carried out in conjunction with, the fiscal years 1999 and 2000 
revitalization pilot programs.
    (c) Reports.--(1) Not later than January 1, 2003, the Secretary 
shall submit to Congress a report on the experience under the fiscal 
years 1999 and 2000 revitalization pilot programs in exercising the 
authorities provided for the administration of those programs. The 
report shall include a description of--
            (A) barriers to the exercise of the authorities that have 
        been encountered;
            (B) the proposed solutions for overcoming the barriers; and
            (C) the progress made in overcoming the barriers.
    (2) Not later than September 1, 2003, the Secretary of Defense 
shall submit to Congress a report on the implementation of the pilot 
program under subsection (a) and the fiscal years 1999 and 2000 
revitalization pilot programs. The report shall include, for each such 
pilot program, the following:
            (A) Each laboratory selected for the pilot program.
            (B) To the extent practicable, a description of the 
        innovative methods that are to be tested at each laboratory.
            (C) The criteria to be used for measuring the success of 
        each method to be tested.
    (3) Not later than 90 days after the expiration of the period for 
the participation of a laboratory in a pilot program referred to in 
paragraph (2), the Secretary of Defense shall submit to Congress a 
final report on the participation of that laboratory in the pilot 
program. The report shall include the following:
            (A) A description of the methods tested.
            (B) The results of the testing.
            (C) The lessons learned.
            (D) Any proposal for legislation that the Secretary 
        recommends on the basis of the experience at that laboratory 
        under the pilot program.
    (d) Extension of Authority for Other Revitalization Pilot 
Programs.--(1) Section 246(a)(4) of the Strom Thurmond National Defense 
Authorization Act for Fiscal Year 1999 (Public Law 105-261; 112 Stat. 
1956; 10 U.S.C. 2358 note) is amended by striking ``a period of three 
years'' and inserting ``up to six years''.
    (2) Section 245(a)(4) of the National Defense Authorization Act for 
Fiscal Year 2000 (Public Law 106-65; 113 Stat. 553; 10 U.S.C. 2358 
note) is amended by striking ``a period of three years'' and inserting 
``up to five years''.
    (e) Partnerships Under Pilot Program.--(1) The Secretary of Defense 
may authorize one or more laboratories and test centers participating 
in the pilot program under subsection (a) or in one of the fiscal years 
1999 and 2000 revitalization pilot programs to enter into a cooperative 
arrangement (in this subsection referred to as a ``public-private 
partnership'') with entities in the private sector and institutions of 
higher education for the performance of work.
    (2) A competitive process shall be used for the selection of 
entities outside the Government to participate in a public-private 
partnership.
    (3)(A) Not more than one public-private partnership may be 
established as a limited liability corporation.
    (B) An entity participating in a limited liability corporation as a 
party to a public-private partnership under the pilot program may 
contribute funds to the corporation, accept contribution of funds for 
the corporation, and provide materials, services, and use of facilities 
for research, technology, and infrastructure of the corporation, if it 
is determined under regulations prescribed by the Secretary of Defense 
that doing so will improve the efficiency of the performance of 
research, test, and evaluation functions of the Department of Defense.
    (f) Excepted Service Under Pilot Program.--(1) To facilitate 
recruitment of experts in science and engineering to improve the 
performance of research, test, and evaluation functions of the 
Department of Defense, the Secretary of Defense may--
            (A) designate a total of not more than 30 scientific, 
        engineering, and technology positions at the laboratories and 
        test centers participating in the pilot program under 
        subsection (a) or in any of the fiscal years 1999 and 2000 
        revitalization pilot programs as positions in the excepted 
        service (as defined in section 2103(a) of title 5, United 
        States Code);
            (B) appoint individuals to such positions; and
            (C) fix the compensation of such individuals.
    (2) The maximum rate of basic pay for a position in the excepted 
service pursuant to a designation made under paragraph (1) may not 
exceed the maximum rate of basic pay authorized for senior-level 
positions under section 5376 of title 5, United States Code, 
notwithstanding any provision of such title governing the rates of pay 
or classification of employees in the executive branch.
    (g) Fiscal Years 1999 and 2000 Revitalization Pilot Programs 
Defined.--In this section, the term ``fiscal years 1999 and 2000 
revitalization pilot programs'' means the pilot programs authorized 
by--
            (1) section 246 of the Strom Thurmond National Defense 
        Authorization Act for Fiscal Year 1999 (Public Law 105-261; 112 
        Stat. 1955; 10 U.S.C. 2358 note); and
            (2) section 245 of the National Defense Authorization Act 
        for Fiscal Year 2000 (Public Law 106-65; 113 Stat. 552; 10 
        U.S.C. 2358 note).

SEC. 242. TECHNOLOGY TRANSITION INITIATIVE.

    (a) Establishment and Conduct.--(1) Chapter 139 of title 10, United 
States Code, is amended by inserting after section 2359 the following 
new section:
``Sec. 2359a. Technology Transition Initiative
    ``(a) Requirement for Program.--The Secretary of Defense shall 
carry out a Technology Transition Initiative to facilitate the rapid 
transition of new technologies from science and technology programs of 
the Department of Defense into acquisition programs for the production 
of the technologies.
    ``(b) Objectives.--The objectives of the Initiative are as follows:
            ``(1) To accelerate the introduction of new technologies 
        into Department of Defense acquisition programs appropriate for 
        the technologies.
            ``(2) To successfully demonstrate new technologies in 
        relevant environments.
            ``(3) To ensure that new technologies are sufficiently 
        mature for production.
    ``(c) Management.--(1) The Secretary of Defense shall designate a 
senior official in the Office of the Secretary of Defense to manage the 
Initiative.
    ``(2) In administering the Initiative, the Initiative Manager 
shall--
            ``(A) report directly to the Under Secretary of Defense for 
        Acquisition, Technology, and Logistics; and
            ``(B) obtain advice and other assistance from the 
        Technology Transition Council established under subsection (e).
    ``(3) The Initiative Manager shall--
            ``(A) in consultation with the Technology Transition 
        Council established under subsection (e), identify promising 
        technologies that have been demonstrated in science and 
        technology programs of the Department of Defense;
            ``(B) develop a list of those technologies that have 
        promising potential for transition into acquisition programs of 
        the Department of Defense and transmit the list to the 
        acquisition executive of each military department and to 
        Congress;
            ``(C) identify potential sponsors in the Department of 
        Defense to undertake the transition of such technologies into 
        production;
            ``(D) work with the science and technology community and 
        the acquisition community to develop memoranda of agreement, 
        joint funding agreements, and other cooperative arrangements to 
        provide for the transition of the technologies into production; 
        and
            ``(E) provide funding support for selected projects under 
        subsection (d).
    ``(d) Jointly Funded Projects.--(1) The acquisition executive of 
each military department shall select technology projects of the 
military department to recommend for funding support under the 
Initiative and shall submit a list of the recommended projects, ranked 
in order of priority, to the Initiative Manager. The projects shall be 
selected, in a competitive process, on the basis of the highest 
potential benefits in areas of interest identified by the Secretary of 
that military department.
    ``(2) The Initiative Manager, in consultation with the Technology 
Transition Council established under subsection (e), shall select 
projects for funding support from among the projects on the lists 
submitted under paragraph (1). The Initiative Manager shall provide 
funds for each selected project. The total amount provided for a 
project shall be determined by agreement between the Initiative Manager 
and the acquisition executive of the military department concerned, but 
shall not be less than the amount equal to 50 percent of the total cost 
of the project.
    ``(3) The Initiative Manager shall not fund any one project under 
this subsection for more than 3 years.
    ``(4) The acquisition executive of the military department shall 
manage each project selected under paragraph (2) that is undertaken by 
the military department. Memoranda of agreement, joint funding 
agreements, and other cooperative arrangements between the science and 
technology community and the acquisition community shall be used in 
carrying out the project if the acquisition executive determines that 
it is appropriate to do so to achieve the objectives of the project.
    ``(e) Technology Transition Council.--(1) There is a Technology 
Transition Council in the Department of Defense. The Council is 
composed of the following members:
            ``(A) The science and technology executives of the military 
        departments and Defense Agencies.
            ``(B) The acquisition executives of the military 
        departments.
            ``(C) The members of the Joint Requirements Oversight 
        Council.
    ``(2) The Technology Transition Council shall provide advice and 
assistance to the Initiative Manager under this section.
    ``(f) Definitions.--In this section:
            ``(1) The term `acquisition executive', with respect to a 
        military department, means the official designated as the 
        senior procurement executive for that military department under 
        section 16(3) of the Office of Federal Procurement Policy Act 
        (41 U.S.C. 414(3)).
            ``(2) The term `Initiative' means the Technology Transition 
        Initiative carried out under this section.
            ``(3) The term `Initiative Manager' means the official 
        designated to manage the Initiative under subsection (c).''.
    (2) The table of sections at the beginning of such chapter is 
amended by inserting after the item relating to section 2395 the 
following new item:

``2359a. Technology Transition Initiative.''.
    (b) Authorization of Appropriations.--Of the amount authorized to 
be appropriated under section 201(4), $50,000,000 shall be available 
for the Technology Transition Initiative under section 2359a of title 
10, United States Code (as added by subsection (a)), and for other 
technology transition activities of the Department of Defense.

SEC. 243. ENCOURAGEMENT OF SMALL BUSINESSES AND NONTRADITIONAL DEFENSE 
              CONTRACTORS TO SUBMIT PROPOSALS POTENTIALLY BENEFICIAL 
              FOR COMBATING TERRORISM.

    (a) Establishment of Outreach Program.--During the 3-year period 
beginning on the date of the enactment of this Act, the Secretary of 
Defense shall carry out a program of outreach to small businesses and 
nontraditional defense contractors for the purpose set forth in 
subsection (b).
    (b) Purpose.--The purpose of the outreach program is to provide a 
process for reviewing and evaluating research activities of, and new 
technologies being developed by, small businesses and nontraditional 
defense contractors that have the potential for meeting a defense 
requirement or technology development goal of the Department of Defense 
that relates to the mission of the Department of Defense to combat 
terrorism.
    (c) Goals.--The goals of the outreach program are as follows:
            (1) To increase efforts within the Department of Defense to 
        survey and identify technologies being developed outside the 
        Department that have the potential described in subsection (b).
            (2) To provide the Under Secretary of Defense for 
        Acquisition, Technology, and Logistics with a source of expert 
        advice on new technologies for combating terrorism.
            (3) To increase efforts to educate nontraditional defense 
        contractors on Department of Defense acquisition processes, 
        including regulations, procedures, funding opportunities, 
        military needs and requirements, and technology transfer so as 
        to encourage such contractors to submit proposals regarding 
        research activities and technologies described in subsection 
        (b).
            (4) To increase efforts to provide timely response by the 
        Department of Defense to acquisition proposals (including 
        unsolicited proposals) submitted to the Department by small 
        businesses and by nontraditional defense contractors regarding 
        research activities and technologies described in subsection 
        (b), including through the use of electronic transactions to 
        facilitate the processing of proposals.
    (d) Review Panel.--(1) The Secretary shall appoint, under the 
outreach program, a panel for the review and evaluation of proposals 
described in subsection (c)(4).
    (2) The panel shall be composed of qualified personnel from the 
military departments, relevant Defense Agencies, industry, academia, 
and other private sector organizations.
    (3) The panel shall review and evaluate proposals that, as 
determined by the panel, may present a unique and valuable approach for 
meeting a defense requirement or technology development goal related to 
combating terrorism. In carrying out duties under this paragraph, the 
panel may act through representatives designated by the panel.
    (4) The panel shall--
            (A) within 60 days after receiving such a proposal, 
        transmit to the source of the proposal a notification regarding 
        whether the proposal has been selected for review by the panel;
            (B) to the maximum extent practicable, complete the review 
        of each selected proposal within 120 days after the proposal is 
        selected for review by the panel; and
            (C) after completing the review, transmit an evaluation of 
        the proposal to the source of the proposal.
    (5) The Secretary shall ensure that the panel, in reviewing and 
evaluating proposals under this subsection, has the authority to obtain 
assistance, to a reasonable extent, from the appropriate technical 
resources of the laboratories, research, development, and engineering 
centers, test and evaluation activities, and other elements of the 
Department of Defense.
    (6) If, after completing the review of a proposal, the panel 
determines that the proposal represents a unique and valuable approach 
to meeting a defense requirement or technology development goal related 
to combating terrorism, the panel shall submit that determination to 
the Under Secretary of Defense for Acquisition, Technology, and 
Logistics together with any recommendations that the panel considers 
appropriate regarding the proposal.
    (7) The Secretary of Defense shall ensure that there is no conflict 
of interest on the part of a member of the panel with respect to the 
review and evaluation of a proposal by the panel.
    (e) Definitions.--In this section:
            (1) The term ``nontraditional defense contractor'' means an 
        entity that has not, for at least one year prior to the date of 
        the enactment of this Act, entered into, or performed with 
        respect to, any contract described in paragraph (1) or (2) of 
        section 845(e) of the National Defense Authorization Act for 
        Fiscal Year 1994 (10 U.S.C. 2371 note).
            (2) The term ``small business'' means a business concern 
        that meets the applicable size standards prescribed pursuant to 
        section 3(a) of the Small Business Act (15 U.S.C. 632(a)).

SEC. 244. VEHICLE FUEL CELL PROGRAM.

    (a) Program.--The Secretary of Defense shall carry out a vehicle 
fuel cell technology development program in cooperation with the 
Secretary of Energy, the heads of other Federal agencies appropriate 
for participation in the program, and industry.
    (b) Goals and Objectives.--The goals and objectives of the program 
shall be as follows:
            (1) To identify and support technological advances that are 
        necessary for the development of fuel cell technology for use 
        in vehicles of types to be used by the Department of Defense.
            (2) To ensure that critical technology advances are shared 
        among the various fuel cell technology programs within the 
        Federal Government.
            (3) To ensure maximum leverage of Federal Government 
        funding for fuel cell technology development.
    (c) Content of Program.--The program shall include--
            (1) development of vehicle propulsion technologies and fuel 
        cell auxiliary power units, together with pilot demonstrations 
        of such technologies, as appropriate; and
            (2) development of technologies necessary to address 
        critical issues such as hydrogen storage and the need for a 
        hydrogen fuel infrastructure.
    (d) Cooperation With Industry.--(1) The Secretary shall include the 
automobile and truck manufacturing industry and its systems and 
component suppliers in the cooperative involvement of industry in the 
program.
    (2) The Secretary of Defense shall consider whether, in order to 
facilitate the cooperation of industry in the program, the Secretary 
and one or more companies in industry should enter into a cooperative 
agreement that establishes an entity to carry out activities required 
under subsection (c). An entity established by any such agreement shall 
be known as a defense industry fuel cell partnership.
    (3) The Secretary of Defense shall provide for industry to bear, in 
cash or in kind, at least one-half of the total cost of carrying out 
the program.
    (e) Amount for Program.--Of the amount authorized to be 
appropriated by section 201(4), $10,000,000 shall be available for the 
program required by this section.

SEC. 245. DEFENSE NANOTECHNOLOGY RESEARCH AND DEVELOPMENT PROGRAM.

    (a) Establishment.--The Secretary of Defense shall carry out a 
defense nanotechnology research and development program.
    (b) Purposes.--The purposes of the program are as follows:
            (1) To ensure United States global superiority in 
        nanotechnology necessary for meeting national security 
        requirements.
            (2) To coordinate all nanoscale research and development 
        within the Department of Defense, and to provide for 
        interagency cooperation and collaboration on nanoscale research 
        and development between the Department of Defense and other 
        departments and agencies of the United States that are involved 
        in nanoscale research and development.
            (3) To develop and manage a portfolio of fundamental and 
        applied nanoscience and engineering research initiatives that 
        is stable, consistent, and balanced across scientific 
        disciplines.
            (4) To accelerate the transition and deployment of 
        technologies and concepts derived from nanoscale research and 
        development into the Armed Forces, and to establish policies, 
        procedures, and standards for measuring the success of such 
        efforts.
            (5) To collect, synthesize, and disseminate critical 
        information on nanoscale research and development.
    (c) Administration.--In carrying out the program, the Secretary 
shall act through the Director of Defense Research and Engineering, who 
shall supervise the planning, management, and coordination of the 
program. The Director, in consultation with the Secretaries of the 
military departments and the heads of participating Defense Agencies 
and other departments and agencies of the United States, shall--
            (1) prescribe a set of long-term challenges and a set of 
        specific technical goals for the program;
            (2) develop a coordinated and integrated research and 
        investment plan for meeting the long-term challenges and 
        achieving the specific technical goals; and
            (3) develop memoranda of agreement, joint funding 
        agreements, and other cooperative arrangements necessary for 
        meeting the long-term challenges and achieving the specific 
        technical goals.
    (d) Annual Report.--Not later than March 1 of each of 2004, 2005, 
2006, and 2007, the Director of Defense Research and Engineering shall 
submit to the congressional defense committees a report on the program. 
The report shall contain the following matters:
            (1) A review of--
                    (A) the long-term challenges and specific goals of 
                the program; and
                    (B) the progress made toward meeting the challenges 
                and achieving the goals.
            (2) An assessment of current and proposed funding levels, 
        including the adequacy of such funding levels to support 
        program activities.
            (3) A review of the coordination of activities within the 
        Department of Defense and with other departments and agencies.
            (4) An assessment of the extent to which effective 
        technology transition paths have been established as a result 
        of activities under the program.
            (5) Recommendations for additional program activities to 
        meet emerging national security requirements.

                  TITLE III--OPERATION AND MAINTENANCE

              Subtitle A--Authorization of Appropriations

SEC. 301. OPERATION AND MAINTENANCE FUNDING.

    (a) Authorization of Appropriations.--Funds are hereby authorized 
to be appropriated for fiscal year 2003 for the use of the Armed Forces 
and other activities and agencies of the Department of Defense for 
expenses, not otherwise provided for, for operation and maintenance, in 
amounts as follows:
            (1) For the Army, $24,195,242,000.
            (2) For the Navy, $29,368,961,000.
            (3) For the Marine Corps, $3,558,732,000.
            (4) For the Air Force, $27,448,764,000.
            (5) For Defense-wide activities, $14,492,266,000.
            (6) For the Army Reserve, $1,962,610,000.
            (7) For the Naval Reserve, $1,233,759,000.
            (8) For the Marine Corps Reserve, $190,532,000.
            (9) For the Air Force Reserve, $2,165,004,000.
            (10) For the Army National Guard, $4,506,267,000.
            (11) For the Air National Guard, $4,114,910,000.
            (12) For the Defense Inspector General, $155,165,000.
            (13) For the United States Court of Appeals for the Armed 
        Forces, $9,614,000.
            (14) For Environmental Restoration, Army, $395,900,000.
            (15) For Environmental Restoration, Navy, $256,948,000.
            (16) For Environmental Restoration, Air Force, 
        $389,773,000.
            (17) For Environmental Restoration, Defense-wide, 
        $23,498,000.
            (18) For Environmental Restoration, Formerly Used Defense 
        Sites, $252,102,000.
            (19) For Overseas Humanitarian, Disaster, and Civic Aid 
        programs, $58,400,000.
            (20) For Drug Interdiction and Counter-drug Activities, 
        Defense-wide, $873,907,000.
            (21) For the Kaho'olawe Island Conveyance, Remediation, and 
        Environmental Restoration Trust Fund, $25,000,000.
            (22) For Defense Health Program, $14,202,441,000.
            (23) For Cooperative Threat Reduction programs, 
        $416,700,000.
            (24) For Overseas Contingency Operations Transfer Fund, 
        $50,000,000.
            (25) For Support for International Sporting Competitions, 
        Defense, $19,000,000.
    (b) Adjustment.--The total amount authorized to be appropriated 
pursuant to subsection (a) is reduced by--
            (1) $159,790,000, which represents savings resulting from 
        reduced travel; and
            (2) $615,200,000, which represents savings resulting from 
        foreign currency fluctuations.

SEC. 302. WORKING CAPITAL FUNDS.

    Funds are hereby authorized to be appropriated for fiscal year 2003 
for the use of the Armed Forces and other activities and agencies of 
the Department of Defense for providing capital for working capital and 
revolving funds in amounts as follows:
            (1) For the Defense Working Capital Funds, $387,156,000.
            (2) For the National Defense Sealift Fund, $934,129,000.
            (3) For the Defense Commissary Agency Working Capital Fund, 
        $969,200,000.
            (4) For the Pentagon Reservation Maintenance Revolving 
        Fund, $328,000,000.

SEC. 303. ARMED FORCES RETIREMENT HOME.

    There is hereby authorized to be appropriated for fiscal year 2003 
from the Armed Forces Retirement Home Trust Fund the sum of $69,921,000 
for the operation of the Armed Forces Retirement Home, including the 
Armed Forces Retirement Home--Washington and the Armed Forces 
Retirement Home--Gulfport.

SEC. 304. RANGE ENHANCEMENT INITIATIVE FUND.

    (a) Availability of Funds.--Of the amount authorized to be 
appropriated by section 301(a)(5) for operation and maintenance for 
defense-wide activities, $20,000,000 shall be available for the Range 
Enhancement Initiative Fund for the purpose specified in subsection 
(b).
    (b) Purpose.--Subject to subsection (c), amounts authorized to be 
appropriated for the Range Enhancement Initiative Fund shall be 
available to the Secretary of Defense and the Secretaries of the 
military departments to purchase restrictive easements, including 
easements that implement agreements entered into under section 2697 of 
title 10, United States Code, as added by section 2811 of this Act.
    (c) Transfer of Amounts.--(1) Amounts in the Range Enhancement 
Initiative Fund shall, subject to applicable limitations in 
appropriations Acts, be made available to the Secretary of a military 
department under subsection (b) by transfer from the Fund to the 
applicable operation and maintenance account of the military 
department, including the operation and maintenance account for the 
active component, or for a reserve component, of the military 
department.
    (2) Authority to transfer amounts under paragraph (1) is in 
addition to any other authority to transfer funds under this Act.

                  Subtitle B--Environmental Provisions

SEC. 311. ENHANCEMENT OF AUTHORITY ON COOPERATIVE AGREEMENTS FOR 
              ENVIRONMENTAL PURPOSES.

    Section 2701(d) of title 10, United States Code, is amended--
            (1) by redesignating paragraphs (2) and (3) as paragraphs 
        (3) and (4), respectively; and
            (2) by inserting after paragraph (1) the following new 
        paragraph (2):
            ``(2) Cross-fiscal year agreements.--An agreement with an 
        agency under paragraph (1) may be for a period that begins in 
        one fiscal year and ends in another fiscal year if (without 
        regard to any option to extend the period of the agreement) the 
        period of the agreement does not exceed two years.''.

SEC. 312. MODIFICATION OF AUTHORITY TO CARRY OUT CONSTRUCTION PROJECTS 
              FOR ENVIRONMENTAL RESPONSES.

    (a) Restatement and Modification of Authority.--(1) Chapter 160 of 
title 10, United States Code, is amended by adding at the end the 
following new section:
``Sec. 2711. Environmental restoration projects for environmental 
              responses
    ``(a) The Secretary of Defense or the Secretary of a military 
department may carry out an environmental restoration project if that 
Secretary determines that the project is necessary to carry out a 
response under this chapter or CERCLA.
    ``(b) Any construction, development, conversion, or extension of a 
structure or installation of equipment that is included in an 
environmental restoration project may not be considered military 
construction (as that term is defined in section 2801(a) of this 
title).
    ``(c) Funds authorized for deposit in an account established by 
section 2703(a) of this title shall be the only source of funds to 
conduct an environmental restoration project under this section.
    ``(d) In this section, the term `environmental restoration project' 
includes construction, development, conversion, or extension of a 
structure or installation of equipment in direct support of a 
response.''.
    (2) The table of sections at the beginning of that chapter is 
amended by adding at the end the following new item:

``2711. Environmental restoration projects for environmental 
                            responses.''.
    (b) Repeal of Superseded Provision.--(1) Section 2810 of title 10, 
United States Code, is repealed.
    (2) The table of sections at the beginning of chapter 169 of that 
title is amended by striking the item relating to section 2810.

SEC. 313. INCREASED PROCUREMENT OF ENVIRONMENTALLY PREFERABLE PRODUCTS.

    (a) Procurement Goals.--(1) The Secretary of Defense shall 
establish goals for the increased procurement by the Department of 
Defense of procurement items that are environmentally preferable or are 
made with recovered materials.
    (2) The goals established under paragraph (1) shall be consistent 
with the requirements of section 6002 of the Solid Waste Disposal Act 
(42 U.S.C. 6962).
    (3) In establishing goals under paragraph (1), the Secretary shall 
review the Comprehensive Procurement Guidelines and Guidance on 
Acquisition of Environmentally Preferable Products and Services 
developed pursuant to Executive Order 13101 and products identified as 
environmentally preferable in the Federal Logistics Information System.
    (4) In establishing goals under paragraph (1), the Secretary shall 
establish a procurement goal for each category of procurement items 
that is environmentally preferable or is made with recovered materials.
    (5) The goals established under paragraph (1) shall apply to 
Department purchases in each category of procurement items designated 
by the Secretary for purposes of paragraph (4), but shall not apply 
to--
            (A) products or services purchased by Department 
        contractors and subcontractors, even if such products or 
        services are incorporated into procurement items purchased by 
        the Department; or
            (B) credit card purchases or other local purchases that are 
        made outside the requisitioning process of the Department.
    (b) Assessment of Training and Education.--The Secretary shall 
assess the need to establish a program, or enhance existing programs, 
for training and educating Department of Defense procurement officials 
and contractors to ensure that they are aware of Department 
requirements, preferences, and goals for the procurement of items that 
are environmentally preferable or are made with recovered materials.
    (c) Tracking System.--The Secretary shall develop a tracking system 
to identify the extent to which the Department of Defense is procuring 
items that are environmentally preferable or are made with recovered 
materials. The tracking system shall separately track procurement of 
each category of procurement items for which a goal has been 
established under subsection (a)(4).
    (d) Initial Report.--Not later than 120 days after the date of the 
enactment of this Act, the Secretary shall submit to the congressional 
defense committees a report that sets forth--
            (1) the initial goals the Secretary plans to establish 
        under subsection (a); and
            (2) the findings of the Secretary as a result of the 
        assessment under subsection (b), together with any 
        recommendations of the Secretary as a result of the assessment.
    (e) Implementation.--Not later than 180 days after the date of the 
enactment of this Act, the Secretary shall--
            (1) establish an initial set of goals in accordance 
        subsection (a);
            (2) begin the implementation of any recommendations of the 
        Secretary under subsection (d)(2) as a result of the assessment 
        under subsection (b); and
            (3) implement the tracking system required by subsection 
        (c).
    (f) Annual Report.--Not later than March 1 of each year from 2004 
through 2007, the Secretary shall  submit to Congress a report on the 
progress made in the implementation of this section. Each report 
shall--
            (1) identify each category of procurement items for which a 
        goal has been established under subsection (a) as of the end of 
        such year; and
            (2) provide information from the tracking system required 
        by subsection (b) that indicates the extent to which the 
        Department has met the goal for the category of procurement 
        items as of the end of such year.
    (g) Definitions.--In this section:
            (1) Environmentally preferable.--The term ``environmentally 
        preferable'', in the case of a procurement item, means that the 
        item has a lesser or reduced effect on human health and the 
        environment when compared with competing procurement items that 
        serve the same purpose. The comparison may be based upon 
        consideration of raw materials acquisition, production, 
        manufacturing, packaging, distribution, reuse, operation, 
        maintenance, or disposal of the procurement item, or other 
        appropriate matters.
            (2) Procurement item.--The term ``procurement item'' has 
        the meaning given that term in section 1004(16) of the Solid 
        Waste Disposal Act (40 U.S.C. 6903(16)).
            (3) Recovered materials.--The term ``recovered materials'' 
        means waste materials and by-products that have been recovered 
        or diverted from solid waste, but does not include materials 
        and by-products generated from, and commonly used within, an 
        original manufacturing process.

SEC. 314. CLEANUP OF UNEXPLODED ORDNANCE ON KAHO'OLAWE ISLAND, HAWAII.

    (a) Level of Cleanup Required.--The Secretary of the Navy shall 
continue activities for the clearance and removal of unexploded 
ordnance on the Island of Kaho'olawe, Hawaii, and related remediation 
activities, until the later of the following dates:
            (1) The date on which the Kaho'olawe Island access control 
        period expires.
            (2) The date on which the Secretary achieves each of the 
        following objectives:
                    (A) The inspection and assessment of all of 
                Kaho'olawe Island in accordance with current 
                procedures.
                    (B) The clearance of 75 percent of Kaho'olawe 
                Island to the degree specified in the Tier One 
                standards in the memorandum of understanding.
                    (C) The clearance of 25 percent of Kaho'olawe 
                Island to the degree specified in the Tier Two 
                standards in the memorandum of understanding.
    (b) Definitions.--In this section:
            (1) The term ``Kaho'olawe Island access control period'' 
        means the period for which the Secretary of the Navy is 
        authorized to retain the control of access to the Island of 
        Kaho'olawe, Hawaii, under title X of the Department of Defense 
        Appropriations Act, 1994 (Public Law 103-139; 107 Stat. 1480).
            (2) The term ``memorandum of understanding'' means the 
        Memorandum of Understanding Between the United States 
        Department of the Navy and the State of Hawaii Concerning the 
        Island of Kaho'olawe, Hawaii.

               Subtitle C--Defense Dependents' Education

SEC. 331. ASSISTANCE TO LOCAL EDUCATIONAL AGENCIES THAT BENEFIT 
              DEPENDENTS OF MEMBERS OF THE ARMED FORCES AND DEPARTMENT 
              OF DEFENSE CIVILIAN EMPLOYEES.

    (a) Continuation of Department of Defense Program for Fiscal Year 
2003.--Of the amount authorized to be appropriated pursuant to section 
301(a)(5) for operation and maintenance for Defense-wide activities, 
$30,000,000 shall be available only for the purpose of providing 
educational agencies assistance to local educational agencies.
    (b) Notification.--Not later than June 30, 2003, the Secretary of 
Defense shall notify each local educational agency that is eligible for 
assistance or a payment under subsection (a) for fiscal year 2003 of--
            (1) that agency's eligibility for the assistance or 
        payment; and
            (2) the amount of the assistance or payment for which that 
        agency is eligible.
    (c) Disbursement of Funds.--The Secretary of Defense shall disburse 
funds made available under subsection (a) not later than 30 days after 
the date on which notification to the eligible local educational 
agencies is provided pursuant to subsection (b).
    (d) Definitions.--In this section:
            (1) The term ``educational agencies assistance'' means 
        assistance authorized under section 386(b) of the National 
        Defense Authorization Act for Fiscal Year 1993 (Public Law 102-
        484; 20 U.S.C. 7703 note).
            (2) The term ``local educational agency'' has the meaning 
        given that term in section 8013(9) of the Elementary and 
        Secondary Education Act of 1965 (20 U.S.C. 7713(9)).

SEC. 332. IMPACT AID FOR CHILDREN WITH SEVERE DISABILITIES.

    Of the amount authorized to be appropriated pursuant to section 
301(a)(5) for operation and maintenance for Defense-wide activities, 
$5,000,000 shall be available for payments under section 363 of the 
Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 
(as enacted into law by Public Law 106-398; 114 Stat. 1654A-77; 20 
U.S.C. 7703a).

SEC. 333. OPTIONS FOR FUNDING DEPENDENT SUMMER SCHOOL PROGRAMS.

    Section 1402(d)(2) of the Defense Dependents' Education Act of 1978 
(20 U.S.C. 921(d)(2)) is amended to read as follows:
    ``(2) The Secretary shall provide any summer school program under 
this subsection on the same financial basis as programs offered during 
the regular school year, except that the Secretary may charge 
reasonable fees for all or portions of such summer school programs to 
the extent that the Secretary determines appropriate.''.

SEC. 334. COMPTROLLER GENERAL STUDY OF ADEQUACY OF COMPENSATION 
              PROVIDED FOR TEACHERS IN THE DEPARTMENT OF DEFENSE 
              OVERSEAS DEPENDENTS' SCHOOLS.

    (a) Additional Consideration for Study.--Subsection (b) of section 
354 of the National Defense Authorization Act for Fiscal Year 2002 
(Public Law 107-107; 115 Stat. 1064) is amended by inserting after 
paragraph (2) the following new paragraph:
            ``(3) Whether the process for setting teacher compensation 
        is efficient and cost effective.''.
    (b) Extension of Time for Reporting.--Subsection (c) of such 
section is amended by striking ``May 1, 2002'' and inserting ``December 
12, 2002''.

                       Subtitle D--Other Matters

SEC. 341. USE OF HUMANITARIAN AND CIVIC ASSISTANCE FUNDS FOR RESERVE 
              COMPONENT MEMBERS OF SPECIAL OPERATIONS COMMAND ENGAGED 
              IN ACTIVITIES RELATING TO CLEARANCE OF LANDMINES.

    Section 401(c) of title 10, United States Code, is amended by 
adding at the end the following new paragraph (5):
    ``(5) Up to 10 percent of the amount available for a fiscal year 
for activities described in subsection (e)(5) may be expended for the 
pay and allowances of reserve component members of the Special 
Operations Command performing duty in connection with training and 
activities related to the clearing of landmines for humanitarian 
purposes.''.

SEC. 342. CALCULATION OF FIVE-YEAR PERIOD OF LIMITATION FOR NAVY-MARINE 
              CORPS INTRANET CONTRACT.

    (a) Commencement of Period.--The five-year period of limitation 
that is applicable to the multiyear Navy-Marine Corps Intranet contract 
under section 2306c of title 10, United States Code, shall be deemed to 
have begun on the date on which the Under Secretary of Defense for 
Acquisition, Technology, and Logistics and the Chief Information 
Officer of the Department of Defense approved the ordering of 
additional workstations under such contract in accordance with 
subsection (c) of section 814 of the Floyd D. Spence National Defense 
Authorization Act for Fiscal Year 2001, as added by section 362(a) of 
the National Defense Authorization Act for Fiscal Year 2002 (Public Law 
107-107; 115 Stat. 1065).
    (b) Definition.--In this section, the term ``Navy-Marine Corps 
Intranet contract'' has the meaning given such term in section 
814(i)(1) of the Floyd D. Spence National Defense Authorization Act for 
Fiscal Year 2001 (as amended by section 362(c) of Public Law 107-107 
(115 Stat. 1067)).

SEC. 343. REIMBURSEMENT FOR RESERVE COMPONENT INTELLIGENCE SUPPORT.

    (a) Source of Funds.--Chapter 1003 of title 10, United States Code, 
is amended by adding at the end the following new section:
``Sec. 10115. Reimbursement for reserve component intelligence support
    ``(a) Authority.--Funds appropriated or otherwise made available to 
a military department, Defense Agency, or combatant command for 
operation and maintenance shall be available for the pay, allowances, 
and other costs that would be charged to appropriations for a reserve 
component for the performance of duties by members of that reserve 
component in providing intelligence or counterintelligence support to--
            ``(1) such military department, Defense Agency, or 
        combatant command; or
            ``(2) a joint intelligence activity, including any such 
        activity for which funds are authorized to be appropriated 
        within the National Foreign Intelligence Program, the Joint 
        Military Intelligence Program, or the Tactical Intelligence and 
        Related Activities aggregate (or any successor to such program 
        or aggregate).
    ``(b) Construction of Provision.--Nothing in this section shall be 
construed to authorize deviation from established reserve component 
personnel or training procedures.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by adding at the end the following new item:

``10115. Reimbursement for reserve component intelligence support.''.

SEC. 344. CLARIFICATION OF CORE LOGISTICS CAPABILITIES.

    Section 2464(a)(3) of title 10, United States Code, is amended by 
striking ``those capabilities'' and all that follows through ``four 
years'' and inserting ``those logistics capabilities (including 
acquisition logistics capabilities, supply management capabilities, 
system engineering capabilities, maintenance capabilities, and 
modification management capabilities) that are necessary to maintain, 
repair, and sustain the weapon systems and other military equipment 
(including mission-essential weapon systems or materiel not later than 
two years''.

SEC. 345. REBATE AGREEMENTS UNDER THE SPECIAL SUPPLEMENTAL FOOD 
              PROGRAM.

    (a) Applicability to Navy Exchange Markets.--Paragraph (1)(A) of 
section 1060a(e) of title 10, United States Code, is amended by 
inserting ``or Navy Exchange Markets'' after ``commissary stores''.
    (b) Increased Maximum Period of Agreement.--Paragraph (3) of such 
section 1060a(e) is amended by striking ``subsection may not exceed one 
year'' in the first sentence and inserting ``subsection, including any 
period of extension of the contract by modification of the contract, 
exercise of an option, or other cause, may not exceed three years''.

              TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS

                       Subtitle A--Active Forces

SEC. 401. END STRENGTHS FOR ACTIVE FORCES.

    The Armed Forces are authorized strengths for active duty personnel 
as of September 30, 2003, as follows:
            (1) The Army, 480,000.
            (2) The Navy, 375,700.
            (3) The Marine Corps, 175,000.
            (4) The Air Force, 359,000.

SEC. 402. AUTHORITY TO INCREASE STRENGTH AND GRADE LIMITATIONS TO 
              ACCOUNT FOR RESERVE COMPONENT MEMBERS ON ACTIVE DUTY IN 
              SUPPORT OF A CONTINGENCY OPERATION.

    (a) Active Duty Strength.--Section 115(c)(1) of title 10, United 
States Code, is amended to read as follows:
            ``(1) increase the end strength authorized pursuant to 
        subsection (a)(1)(A) for a fiscal year for any of the armed 
        forces by--
                    ``(A) a number equal to not more than 2 percent of 
                that end strength;
                    ``(B) a number equal to the number of members of 
                the reserve components of that armed force on active 
                duty under section 12301(d) of this title in support of 
                a contingency operation in that fiscal year; or
                    ``(C) a number not greater than the sum of the 
                numbers authorized by subparagraphs (A) and (B).''.
    (b) Authorized Daily Average for Members in Pay Grades E-8 and E-9 
on Active Duty.--Section 517 of such title is amended by adding at the 
end the following new paragraph:
    ``(d) The Secretary of Defense may increase the authorized daily 
average number of enlisted members on active duty in an armed force in 
pay grades E-8 and E-9 in a fiscal year under subsection (a) by the 
number of enlisted members of reserve components of that armed force in 
pay grades E-8 and E-9, respectively, that are on active duty in that 
fiscal year under section 12301(d) of this title in support of a 
contingency operation.''.
    (c) Authorized Strengths for Commissioned Officers in Pay Grades O-
4, O-5, and O-6 on Active Duty.--Section 523 of such title is amended--
            (1) in subsection (a), by striking ``subsection (c)'' in 
        paragraphs (1) and (2) and inserting ``subsections (c) and 
        (e)''; and
            (2) by adding at the end the following new subsection:
    ``(e) The Secretary of Defense may increase the authorized total 
number of commissioned officers serving on active duty in the Army, 
Navy, Air Force, or Marine Corps in a grade referred to in subsection 
(c) at the end of any fiscal year under that subsection by the number 
of commissioned officers of reserve components of the Army, Navy, Air 
Force, or Marine Corps, respectively, that are then serving on active 
duty in that grade under section 12301(d) of this title in support of a 
contingency operation.''.
    (d) Authorized Strengths for General and Flag Officers on Active 
Duty.--Section 526(a) of such title is amended--
            (1) by redesignating paragraphs (1), (2), (3), and (4) as 
        subparagraphs (A), (B), (C), and (D), respectively;
            (2) by striking ``Limitations.--The'' and inserting 
        ``Limitations.--(1) Except as provided in paragraph (2), the''; 
        and
            (3) by adding at the end the following new paragraph (2):
    ``(2) The Secretary of Defense may increase the number of general 
and flag officers authorized to be on active duty in the Army, Navy, 
Air Force, or Marine Corps under paragraph (1) by the number of reserve 
general or flag officers of reserve components of the Army, Navy, Air 
Force, or Marine Corps, respectively, that are on active duty under 
section 12301(d) of this title in support of a contingency 
operation.''.

SEC. 403. INCREASED ALLOWANCE FOR NUMBER OF MARINE CORPS GENERAL 
              OFFICERS ON ACTIVE DUTY IN GRADES ABOVE MAJOR GENERAL.

    Section 525(b)(2)(B) of title 10, United States Code, is amended by 
striking ``16.2 percent'' and inserting ``17.5 percent''.

SEC. 404. INCREASE IN AUTHORIZED STRENGTHS FOR MARINE CORPS OFFICERS ON 
              ACTIVE DUTY IN THE GRADE OF COLONEL.

    The table in section 523(a)(1) of title 10, United States Code, is 
amended by striking the figures under the heading ``Colonel'' in the 
portion of the table relating to the Marine Corps and inserting the 
following:

         ``571
          632
          653
          673
          694
          715
          735''.

                       Subtitle B--Reserve Forces

SEC. 411. END STRENGTHS FOR SELECTED RESERVE.

    (a) In General.--The Armed Forces are authorized strengths for 
Selected Reserve personnel of the reserve components as of September 
30, 2003, as follows:
            (1) The Army National Guard of the United States, 350,000.
            (2) The Army Reserve, 205,000.
            (3) The Naval Reserve, 87,800.
            (4) The Marine Corps Reserve, 39,558.
            (5) The Air National Guard of the United States, 106,600.
            (6) The Air Force Reserve, 75,600.
            (7) The Coast Guard Reserve, 9,000.
    (b) Adjustments.--The end strengths prescribed by subsection (a) 
for the Selected Reserve of any reserve component shall be 
proportionately reduced by--
            (1) the total authorized strength of units organized to 
        serve as units of the Selected Reserve of such component which 
        are on active duty (other than for training) at the end of the 
        fiscal year; and
            (2) the total number of individual members not in units 
        organized to serve as units of the Selected Reserve of such 
        component who are on active duty (other than for training or 
        for unsatisfactory participation in training) without their 
        consent at the end of the fiscal year.
Whenever such units or such individual members are released from active 
duty during any fiscal year, the end strength prescribed for such 
fiscal year for the Selected Reserve of such reserve component shall be 
proportionately increased by the total authorized strengths of such 
units and by the total number of such individual members.

SEC. 412. END STRENGTHS FOR RESERVES ON ACTIVE DUTY IN SUPPORT OF THE 
              RESERVES.

    Within the end strengths prescribed in section 411(a), the reserve 
components of the Armed Forces are authorized, as of September 30, 
2003, the following number of Reserves to be serving on full-time 
active duty or full-time duty, in the case of members of the National 
Guard, for the purpose of organizing, administering, recruiting, 
instructing, or training the reserve components:
            (1) The Army National Guard of the United States, 24,492.
            (2) The Army Reserve, 13,888.
            (3) The Naval Reserve, 14,572.
            (4) The Marine Corps Reserve, 2,261.
            (5) The Air National Guard of the United States, 11,727.
            (6) The Air Force Reserve, 1,498.

SEC. 413. END STRENGTHS FOR MILITARY TECHNICIANS (DUAL STATUS).

    The minimum number of military technicians (dual status) as of the 
last day of fiscal year 2003 for the reserve components of the Army and 
the Air Force (notwithstanding section 129 of title 10, United States 
Code) shall be the following:
            (1) For the Army Reserve, 6,599.
            (2) For the Army National Guard of the United States, 
        24,102.
            (3) For the Air Force Reserve, 9,911.
            (4) For the Air National Guard of the United States, 
        22,495.

SEC. 414. FISCAL YEAR 2003 LIMITATIONS ON NON-DUAL STATUS TECHNICIANS.

    (a) Limitations.--(1) Within the limitation provided in section 
10217(c)(2) of title 10, United States Code, the number of non-dual 
status technicians employed by the National Guard as of September 30, 
2003, may not exceed the following:
            (A) For the Army National Guard of the United States, 
        1,600.
            (B) For the Air National Guard of the United States, 350.
    (2) The number of non-dual status technicians employed by the Army 
Reserve as of September 30, 2003, may not exceed 995.
    (3) The Air Force Reserve may not employ any person as a non-dual 
status technician during fiscal year 2003.
    (b) Non-Dual Status Technicians Defined.--In this section, the term 
``non-dual status technician'' has the meaning given the term in 
section 10217(a) of title 10, United States Code.

              Subtitle C--Authorization of Appropriations

SEC. 421. AUTHORIZATION OF APPROPRIATIONS FOR MILITARY PERSONNEL.

    There is hereby authorized to be appropriated to the Department of 
Defense for military personnel for fiscal year 2003 a total of 
$94,352,208,000. The authorization in the preceding sentence supersedes 
any other authorization of appropriations (definite or indefinite) for 
such purpose for fiscal year 2003.

                   TITLE V--MILITARY PERSONNEL POLICY

                  Subtitle A--Officer Personnel Policy

SEC. 501. EXTENSION OF CERTAIN REQUIREMENTS AND EXCLUSIONS APPLICABLE 
              TO SERVICE OF GENERAL AND FLAG OFFICERS ON ACTIVE DUTY IN 
              CERTAIN JOINT DUTY ASSIGNMENTS.

    (a) Recommendations for Assignment to Senior Joint Officer 
Positions.--Section 604(c) of title 10, United States Code, is amended 
by striking ``September 30, 2003'' and inserting ``December 31, 2003''.
    (b) Inapplicability of Grade Distribution Requirements.--Section 
525(b)(5)(C) of such title is amended by striking ``September 30, 
2003'' and inserting ``December 31, 2003''.
    (c) Exclusion From Strength Limitation.--Section 526(b)(3) of such 
title is amended by striking ``October 1, 2002'' and inserting 
``December 31, 2003''.

SEC. 502. EXTENSION OF AUTHORITY TO WAIVE REQUIREMENT FOR SIGNIFICANT 
              JOINT DUTY EXPERIENCE FOR APPOINTMENT AS A CHIEF OF A 
              RESERVE COMPONENT OR A NATIONAL GUARD DIRECTOR.

    (a) Chief of Army Reserve.--Section 3038(b)(4) of title 10, United 
States Code, is amended by striking ``October 1, 2003'' and inserting 
``December 31, 2003''.
    (b) Chief of Naval Reserve.--Section 5143(b)(4) of such title is 
amended by striking ``October 1, 2003'' and inserting ``December 31, 
2003''.
    (c) Commander, Marine Forces Reserve.--Section 5144(b)(4) of such 
title is amended by striking ``October 1, 2003'' and inserting 
``December 31, 2003''.
    (d) Chief of Air Force Reserve.--Section 8038(b)(4) of such title 
10, United States Code, is amended by striking ``October 1, 2003'' and 
inserting ``December 31, 2003''.
    (e) Directors of the National Guard.--Section 10506(a)(3)(D) of 
such title is amended by striking ``October 1, 2003'' and inserting 
``December 31, 2003''.

             Subtitle B--Reserve Component Personnel Policy

SEC. 511. TIME FOR COMMENCEMENT OF INITIAL PERIOD OF ACTIVE DUTY FOR 
              TRAINING UPON ENLISTMENT IN RESERVE COMPONENT.

    Section 12103(d) of title 10, United States Code, is amended by 
striking ``270 days'' in the second sentence and inserting ``one 
year''.

SEC. 512. AUTHORITY FOR LIMITED EXTENSION OF MEDICAL DEFERMENT OF 
              MANDATORY RETIREMENT OR SEPARATION OF RESERVE COMPONENT 
              OFFICER.

    (a) Authority.--Chapter 1407 of title 10, United States Code, is 
amended by adding at the end the following new section:
``Sec. 14519. Deferment of retirement or separation for medical reasons
    ``(a) Authority.--If, in the case of an officer required to be 
retired or separated under this chapter or chapter 1409 of this title, 
the Secretary concerned determines that the evaluation of the physical 
condition of the officer and determination of the officer's entitlement 
to  retirement or separation for physical disability require 
hospitalization or medical observation and that such hospitalization or 
medical observation cannot be completed with confidence in a manner 
consistent with the officer's well being before the date on which the 
officer would otherwise be required to retire or be separated, the 
Secretary may defer the retirement or separation of the officer.
    ``(b) Period of Deferment.--A deferral of retirement or separation 
under subsection (a) may not extend for more than 30 days after the 
completion of the evaluation requiring hospitalization or medical 
observation.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by adding at the end the following new item:

``14519. Deferment of retirement or separation for medical reasons.''.

                   Subtitle C--Education and Training

SEC. 521. INCREASE IN AUTHORIZED STRENGTHS FOR THE SERVICE ACADEMIES.

    (a) United States Military Academy.--Section 4342 of title 10, 
United States Code, is amended--
            (1) in subsection (a), by striking ``4,000'' in the first 
        sentence and inserting ``4,400''; and
            (2) in subsection (i), by striking ``variance in that 
        limitation'' and inserting ``variance above that limitation''.
    (b) United States Naval Academy.--Section 6954 of title 10, United 
States Code, is amended--
            (1) in subsection (a), by striking ``4,000'' in the first 
        sentence and inserting ``4,400'; and
            (2) in subsection (g), by striking ``variance in that 
        limitation'' and inserting ``variance above that limitation''.
    (c) United States Air Force Academy.--Section 9342 of title 10, 
United States Code, is amended--
            (1) in subsection (a), by striking ``4,000'' in the first 
        sentence and inserting ``4,400''; and
            (2) in subsection (i), by striking ``variance in that 
        limitation'' and inserting ``variance above that limitation''.

           Subtitle D--Decorations, Awards, and Commendations

SEC. 531. WAIVER OF TIME LIMITATIONS FOR AWARD OF CERTAIN DECORATIONS 
              TO CERTAIN PERSONS.

    (a) Waiver.--Any limitation established by law or policy for the 
time within which a recommendation for the award of a military 
decoration or award must be submitted shall not apply to awards of 
decorations described in this section, the award of each such 
decoration having been determined by the Secretary concerned to be 
warranted in accordance with section 1130 of title 10, United States 
Code.
    (b) Distinguished-Service Cross of the Army.--Subsection (a) 
applies to the award of the Distinguished-Service Cross of the Army as 
follows:
            (1) To Henry Johnson of Albany, New York, for extraordinary 
        heroism in France during the period of May 13 to 15, 1918, 
        while serving as a member of the Army.
            (2) To Hilliard Carter of Jackson, Mississippi, for 
        extraordinary heroism in actions near Troung Loung, Republic of 
        Vietnam, on September 28, 1966, while serving as a member of 
        the Army.
            (3) To Albert C. Welch of Highland Ranch, Colorado, for 
        extraordinary heroism in actions in Ong Thanh, Binh Long 
        Province, Republic of Vietnam, on October 17, 1967, while 
        serving as a member of the Army.
    (c) Distinguished Flying Cross of the Navy.--Subsection (a) applies 
to the award of the Distinguished Flying Cross of the Navy as follows:
            (1) To Eduguardo Coppola of Falls Church, Virginia, for 
        extraordinary achievement while participating in aerial flight 
        during World War II, while serving as a member of the Navy.
            (2) To James Hoisington, Jr., of Stillman Valley, Illinois, 
        for extraordinary achievement while participating in aerial 
        flight during World War II, while serving as a member of the 
        Navy.
            (3) To William M. Melvin of Lawrenceburg, Tennessee, for 
        extraordinary achievement while participating in aerial flight 
        during World War II, while serving as a member of the Navy.
            (4) To Vincent Urbank of Tom River, New Jersey, for 
        extraordinary achievement while participating in aerial flight 
        during World War II, while serving as a member of the Navy.

SEC. 532. KOREA DEFENSE SERVICE MEDAL.

    (a) Findings.--Congress makes the following findings:
            (1) More than 40,000 members of the United States Armed 
        Forces have served on the Korean Peninsula each year since the 
        signing of the cease-fire agreement in July 1953 ending the 
        Korean War.
            (2) An estimated 1,200 members of the United States Armed 
        Forces died as a direct result of their service in Korea since 
        the cease-fire agreement in July 1953.
    (b) Army.--(1) Chapter 357 of title 10, United States Code, is 
amended by adding at the end the following new section:
``Sec. 3755. Korea Defense Service Medal
    ``(a) The Secretary of the Army shall issue a campaign medal, to be 
known as the Korea Defense Service Medal, to each person who while a 
member of the Army served in the Republic of Korea or the waters 
adjacent thereto during the KDSM eligibility period and met the service 
requirements for the award of that medal prescribed under subsection 
(c).
    ``(b) In this section, the term `KDSM eligibility period' means the 
period beginning on July 28, 1954, and ending on such date after the 
date of the enactment of this section as may be determined by the 
Secretary of Defense to be appropriate for terminating eligibility for 
the Korea Defense Service Medal.
    ``(c) The Secretary of the Army shall prescribe service 
requirements for eligibility for the Korea Defense Service Medal. Those 
requirements shall not be more stringent than the service requirements 
for award of the Armed Forces Expeditionary Medal for instances in 
which the award of that medal is authorized.''.
    (2) The table of sections at the beginning of such chapter is 
amended by adding at the end the following new item:

``3755. Korea Defense Service Medal.''.
    (c) Navy and Marine Corps.--(1) Chapter 567 of title 10, United 
States Code, is amended by adding at the end the following new section:
``Sec. 6257. Korea Defense Service Medal
    ``(a) The Secretary of the Navy shall issue a campaign medal, to be 
known as the Korea Defense Service Medal, to each person who while a 
member of the Navy or Marine Corps served in the Republic of Korea or 
the waters adjacent thereto during the KDSM eligibility period and met 
the service requirements for the award of that medal prescribed under 
subsection (c).
    ``(b) In this section, the term `KDSM eligibility period' means the 
period beginning on July 28, 1954, and ending on such date after the 
date of the enactment of this section as may be determined by the 
Secretary of Defense to be appropriate for terminating eligibility for 
the Korea Defense Service Medal.
    ``(c) The Secretary of the Navy shall prescribe service 
requirements for eligibility for the Korea Defense Service Medal. Those 
requirements shall not be more stringent than the service requirements 
for award of the Armed Forces Expeditionary Medal for instances in 
which the award of that medal is authorized.''.
    (2) The table of sections at the beginning of such chapter is 
amended by adding at the end the following new item:

``6257. Korea Defense Service Medal.''.
    (d) Air Force.--(1) Chapter 857 of title 10, United States Code, is 
amended by adding at the end the following new section:
``Sec. 8755. Korea Defense Service Medal
    ``(a) The Secretary of the Air Force shall issue a campaign medal, 
to be known as the Korea Defense Service Medal, to each person who 
while a member of the Air Force served in the Republic of Korea or the 
waters adjacent thereto during the KDSM eligibility period and met the 
service requirements for the award of that medal prescribed under 
subsection (c).
    ``(b) In this section, the term `KDSM eligibility period' means the 
period beginning on July 28, 1954, and ending on such date after the 
date of the enactment of this section as may be determined by the 
Secretary of Defense to be appropriate for terminating eligibility for 
the Korea Defense Service Medal.
    ``(c) The Secretary of the Air Force shall prescribe service 
requirements for eligibility for the Korea Defense Service Medal. Those 
requirements shall not be more stringent than the service requirements 
for award of the Armed Forces Expeditionary Medal for instances in 
which the award of that medal is authorized.''.
    (2) The table of sections at the beginning of such chapter is 
amended by adding at the end the following new item:

``8755. Korea Defense Service Medal.''.
    (e) Award for Service Before Date of Enactment.--The Secretary of 
the military department concerned shall take appropriate steps to 
provide in a timely manner for the issuance of the Korea Defense 
Service Medal, upon application therefor, to persons whose eligibility 
for that medal is by reason of service in the Republic of Korea or the 
waters adjacent thereto before the date of the enactment of this Act.

                  Subtitle E--National Call to Service

SEC. 541. ENLISTMENT INCENTIVES FOR PURSUIT OF SKILLS TO FACILITATE 
              NATIONAL SERVICE.

    (a) Authority.--(1) Chapter 5 of title 37, United States Code, is 
amended by adding at the end the following new section:
``Sec. 326. Enlistment incentives for pursuit of skills to facilitate 
              national service
    ``(a) Incentives Authorized.--The Secretary of Defense may carry 
out a program in accordance with the provisions of this section under 
which program a National Call to Service participant described in 
subsection (b) shall be entitled to an incentive specified in 
subsection (d).
    ``(b) National Call to Service Participant.--In this section, the 
term `National Call to Service participant' means a person who first 
enlists in the armed forces pursuant to a written agreement (prescribed 
by the Secretary of the military department concerned) under which 
agreement the person shall--
            ``(1) upon completion of initial entry training (as 
        prescribed by the Secretary of Defense), serve on active duty 
        in the armed forces in a military occupational specialty 
        designated by the Secretary of Defense under subsection (c) for 
        a period of 15 months; and
            ``(2) upon completion of such service on active duty, and 
        without a break in service, serve the minimum period of 
        obligated service specified in the agreement under this 
        section--
                    ``(A) on active duty in the armed forces;
                    ``(B) in the Selected Reserve;
                    ``(C) in the Individual Ready Reserve;
                    ``(D) in the Peace Corps, Americorps, or another 
                national service program jointly designated by the 
                Secretary of Defense and the head of such program for 
                purposes of this section; or
                    ``(E) in any combination of service referred to in 
                subparagraphs (A) through (D) that is approved by the 
                Secretary of the military department concerned pursuant 
                to regulations prescribed by the Secretary of Defense.
    ``(c) Designated Military Occupational Specialties.--The Secretary 
of Defense shall designate military occupational specialties for 
purposes of subsection (b)(1). Such military occupational specialties 
shall be military occupational specialties that will facilitate, as 
determined by the Secretary, pursuit of national service by National 
Call to Service participants during and after their completion of duty 
or service under an agreement under subsection (b).
    ``(d) Incentives.--The incentives specified in this subsection are 
as follows:
            ``(1) Payment of a bonus in the amount of $5,000.
            ``(2) Payment of outstanding principal and interest on 
        qualifying student loans of the National Call to Service 
        participant in an amount not to exceed $18,000.
            ``(3) Entitlement to an allowance for educational 
        assistance at the monthly rate equal to the monthly rate 
        payable for basic educational assistance allowances under 
        section 3015(a)(1) of title 38 for a total of 12 months.
            ``(4) Entitlement to an allowance for educational 
        assistance at the monthly rate equal to \2/3\ of the monthly 
        rate payable for basic educational assistance allowances under 
        section 3015(b)(1) of title 38 for a total of 36 months.
    ``(e) Election of Incentives.--A National Call to Service 
participant shall elect in the agreement under subsection (b) which 
incentive under subsection (d) to receive. An election under this 
subsection is irrevocable.
    ``(f) Payment of Bonus Amounts.--(1) Payment to a National Call to 
Service participant of the bonus elected by the National Call to 
Service participant under subsection (d)(1) shall be made in such time 
and manner as the Secretary of Defense shall prescribe.
    ``(2)(A) Payment of outstanding principal and interest on the 
qualifying student loans of a National Call to Service participant, as 
elected under subsection (d)(2), shall be made in such time and manner 
as the Secretary of Defense shall prescribe.
    ``(B) Payment under this paragraph of the outstanding principal and 
interest on the qualifying student loans of a National Call to Service 
participant shall be made to the holder of such student loans, as 
identified by the National Call to Service participant to the Secretary 
of the military department concerned for purposes of such payment.
    ``(3) Payment of a bonus or incentive in accordance with this 
subsection shall be made by the Secretary of the military department 
concerned.
    ``(g) Coordination With Montgomery GI Bill Benefits.--(1) A 
National Call to Service participant who elects an incentive under 
paragraph (3) or (4) of subsection (d) is not entitled to educational 
assistance under chapter 1606 of title 10 or basic educational 
assistance under subchapter II of chapter 30 of title 38.
    ``(2)(A) The Secretary of Defense shall, to the maximum extent 
practicable, administer the receipt by National Call to Service 
participants of incentives under paragraph (3) or (4) of subsection (d) 
as if such National Call to Service participants were, in receiving 
such incentives, receiving educational assistance for members of the 
Selected Reserve under chapter 1606 of title 10.
    ``(B) The Secretary of Defense shall, in consultation with the 
Secretary of Veterans Affairs, prescribe regulations for purposes of 
subparagraph (A). Such regulations shall, to the maximum extent 
practicable, take into account the administrative provisions of 
chapters 30 and 36 of title 38 that are specified in section 16136 of 
title 10.
    ``(3) Except as provided in paragraph (1), nothing in this section 
shall prohibit a National Call to Service participant who satisfies 
through service under subsection (b) the eligibility requirements for 
educational assistance under chapter 1606 of title 10 or basic 
educational assistance under chapter 30 of title 38 from an entitlement 
to such educational assistance under chapter 1606 of title 10 or basic 
educational assistance under chapter 30 of title 38, as the case may 
be.
    ``(h) Repayment.--(1) If a National Call to Service participant who 
has entered into an agreement under subsection (b) and received or 
benefited from an incentive under subsection (d)(1) or (d)(2) fails to 
complete the total period of service specified in such agreement, the 
National Call to Service participant shall refund to the United States 
the amount that bears the same ratio to the amount of the incentive as 
the uncompleted part of such service bears to the total period of such 
service.
    ``(2) Subject to paragraph (3), an obligation to reimburse the 
United States imposed under paragraph (1) is for all purposes a debt 
owed to the United States.
    ``(3) The Secretary concerned may waive, in whole or in part, a 
reimbursement required under paragraph (1) if the Secretary concerned 
determines that recovery would be against equity and good conscience or 
would be contrary to the best interests of the United States.
    ``(4) A discharge in bankruptcy under title 11 that is entered into 
less than 5 years after the termination of an agreement entered into 
under subsection (b) does not discharge the person signing the 
agreement from a debt arising under the agreement or under paragraph 
(1).
    ``(i) Funding.--Amounts for payment of incentives under subsection 
(d), including payment of allowances for educational assistance under 
that subsection, shall be derived from amounts available to the 
Secretary of the military department concerned for payment of pay, 
allowances, and other expenses of the members of the armed force 
concerned.
    ``(j) Regulations.--The Secretary of Defense and the Secretaries of 
the military departments shall prescribe regulations for purposes of 
the program under this section.
    ``(k) Definitions.--In this section:
            ``(1) The term `Americorps' means the Americorps program 
        carried out under subtitle C of title I of the National and 
        Community Service Act of 1990 (42 U.S.C. 12571 et seq.).
            ``(2) The term `qualifying student loan' means a loan, the 
        proceeds of which were used to pay the cost of attendance (as 
        defined in section 472 of the Higher Education Act of 1965 (20 
        U.S.C. 1087ll) at an institution of higher education (as 
        defined in section 101 of the Higher Education Act of 1965 (20 
        U.S.C. 1001).
            ``(3) The term `Secretary of a military department' 
        includes the Secretary of Transportation, with respect to 
        matters concerning the Coast Guard when it is not operating as 
        a service in the Navy.''.
    (2) The table of sections at the beginning of that chapter is 
amended by inserting after the item relating to section 325 the 
following new item:

``326. Enlistment incentives for pursuit of skills to facilitate 
                            national service.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect on October 1, 2002. No individual entering into an 
enlistment before that date may participate in the program under 
section 326 of title 37, United States Code, as added by that 
subsection.

SEC. 542. MILITARY RECRUITER ACCESS TO INSTITUTIONS OF HIGHER 
              EDUCATION.

    (a) Access to Institutions of Higher Education.--Section 503 of 
title 10, United States Code, is amended--
            (1) by redesignating subsection (d) as subsection (e); and
            (2) by inserting after subsection (c) the following new 
        subsection (d):
    ``(d) Access to Institutions of Higher Education.--(1) Each 
institution of higher education receiving assistance under the Higher 
Education Act of 1965 (20 U.S.C. 1001 et seq.)--
            ``(A) shall provide to military recruiters the same access 
        to students at the institution as is provided generally to 
        prospective employers of those students; and
            ``(B) shall, upon a request made by military recruiters for 
        military recruiting purposes, provide access to the names, 
        addresses, and telephone listings of students at the 
        institution, notwithstanding section 444(a)(5)(B) of the 
        General Education Provisions Act (20 U.S.C. 1232g(a)(5)(B)).
    ``(2) An institution of higher education may not release a 
student's name, address, and telephone listing under paragraph (1)(B) 
without the prior written consent of the student or the parent of the 
student (in the case of a student under the age of 18) if the student, 
or a parent of the student, as appropriate, has submitted a request to 
the institution of higher education that the student's information not 
be released for a purpose covered by that subparagraph without prior 
written consent. Each institution of higher education shall notify 
students and parents of the rights provided under the preceding 
sentence.
    ``(3) In this subsection, the term `institution of higher 
education' has the meaning given the term in section 101 of the Higher 
Education Act of 1965 (20 U.S.C. 1001).''.
    (b) Notification.--The Secretary of Education shall provide to 
institutions of higher education notice of the provisions of subsection 
(d) of section 503 of title 10, United States Code, as amended by 
subsection (a) of this section. Such notice shall be provided not later 
than 120 days after the date of the enactment of this Act, and shall be 
provided in consultation with the Secretary of Defense.

                       Subtitle F--Other Matters

SEC. 551. BIENNIAL SURVEYS ON RACIAL, ETHNIC, AND GENDER ISSUES.

    (a) Division of Annual Survey Into Two Biennial Surveys.--Section 
481 of title 10, United States Code, is amended to read as follows:
``Sec. 481. Racial, ethnic, and gender issues: biennial surveys
    ``(a) In General.--The Secretary of Defense shall carry out two 
separate biennial surveys in accordance with this section to identify 
and assess racial, ethnic, and gender issues and discrimination among 
members of the armed forces serving on active duty and the extent (if 
any) of activity among such members that may be seen as so-called `hate 
group' activity.
    ``(b) Biennial Survey on Racial and Ethnic Issues.--One of the 
surveys conducted every two years under this section shall solicit 
information on racial and ethnic issues and the climate in the armed 
forces for forming professional relationships among members of the 
armed forces of the various racial and ethnic groups. The information 
solicited shall include the following:
            ``(1) Indicators of positive and negative trends for 
        professional and personal relationships among members of all 
        racial and ethnic groups.
            ``(2) The effectiveness of Department of Defense policies 
        designed to improve relationships among all racial and ethnic 
        groups.
            ``(3) The effectiveness of current processes for complaints 
        on and investigations into racial and ethnic discrimination.
    ``(c) Biennial Survey on Gender Issues.--One of the surveys 
conducted every two years under this section shall solicit information 
on gender issues, including issues relating to gender-based harassment 
and discrimination, and the climate in the armed forces for forming 
professional relationships between male and female members of the armed 
forces. The information solicited shall include the following:
            ``(1) Indicators of positive and negative trends for 
        professional and personal relationships between male and female 
        members of the armed forces.
            ``(2) The effectiveness of Department of Defense policies 
        designed to improve professional relationships between male and 
        female members of the armed forces.
            ``(3) The effectiveness of current processes for complaints 
        on and investigations into gender-based discrimination.
    ``(d) Surveys To Alternate Every Year.--The biennial survey under 
subsection (b) shall be conducted in odd-numbered years. The biennial 
survey under subsection (c) shall be conducted in even-numbered years.
    ``(e) Implementing Entity.--The Secretary shall carry out the 
biennial surveys through entities in the Department of Defense as 
follows:
            ``(1) The biennial review under subsection (b), through the 
        Armed Forces Survey on Racial and Ethnic Issues.
            ``(2) The biennial review under subsection (c), through the 
        Armed Forces Survey on Gender Issues.
    ``(f) Reports to Congress.--Upon the completion of a biennial 
survey under this section, the Secretary shall submit to Congress a 
report containing the results of the survey.
    ``(g) Inapplicability to Coast Guard.--The requirements for surveys 
under this section do not apply to the Coast Guard.''.
    (b) Clerical Amendment.--The item relating to such section in the 
table of sections at the beginning of chapter 23 of such title is 
amended to read as follows:

``481. Racial, ethnic, and gender issues: biennial surveys.''.

SEC. 552. LEAVE REQUIRED TO BE TAKEN PENDING REVIEW OF A RECOMMENDATION 
              FOR REMOVAL BY A BOARD OF INQUIRY.

    (a) Requirement.--Section 1182(c) of title 10, United States Code, 
is amended--
            (1) by inserting ``(1)'' after ``(c)''; and
            (2) by adding at the end the following new paragraph:
    ``(2) Under regulations prescribed by the Secretary concerned, an 
officer referred to in paragraph (1) may be  required to take leave 
pending the completion of the action under this chapter in the case of 
that officer. The officer may be required to begin such leave at any 
time following the officer's receipt of the report of the board of 
inquiry, including the board's recommendation for removal from active 
duty, and the expiration of any period allowed for submission by the 
officer of a rebuttal to that report. The leave may be continued until 
the date on which action by the Secretary concerned under this chapter 
is completed in the case of the officer or may be terminated at any 
earlier time.''.
    (b) Payment for Mandatory Excess Leave Upon Disapproval of Certain 
Involuntary Separation Recommendations.--Chapter 40 of such title is 
amended by inserting after section 707 the following new section:
``Sec. 707a. Payment upon disapproval of certain board of inquiry 
              recommendations for excess leave required to be taken
    ``(a) An officer--
            ``(1) who is required to take leave under section 
        1182(c)(2) of this title, any period of which is charged as 
        excess leave under section 706(a) of this title, and
            ``(2) whose recommendation for removal from active duty in 
        a report of a board of inquiry is not approved by the Secretary 
        concerned under section 1184 of this title,
shall be paid, as provided in subsection (b), for the period of leave 
charged as excess leave.
    ``(b)(1) An officer entitled to be paid under this section shall be 
deemed, for purposes of this section, to have accrued pay and 
allowances for each day of leave required to be taken under section 
1182(c)(2) of this title that is charged as excess leave (except any 
day of accrued leave for which the officer has been paid under section 
706(b)(1) of this title and which has been charged as excess leave).
    ``(2) The officer shall be paid the amount of pay and allowances 
that is deemed to have accrued to the officer under paragraph (1), 
reduced by the total amount of his income from wages, salaries, tips, 
other personal service income, unemployment compensation, and public 
assistance benefits from any Government agency during the period the 
officer is deemed to have accrued pay and allowances. Except as 
provided in paragraph (3), such payment shall be made within 60 days 
after the date on which the Secretary concerned decides not to remove 
the officer from active duty.
    ``(3) If an officer is entitled to be paid under this section, but 
fails to provide sufficient information in a timely manner regarding 
the officer's income when such information is requested under 
regulations prescribed under subsection (c), the period of time 
prescribed in paragraph (2) shall be extended until 30 days after the 
date on which the member provides the information requested.
    ``(c) This section shall be administered under uniform regulations 
prescribed by the Secretaries concerned. The regulations may provide 
for the method of determining an officer's income during any period the 
officer is deemed to have accrued pay and allowances, including a 
requirement that the officer provide income tax returns and other 
documentation to verify the amount of the officer's income.''.
    (c) Conforming Amendments.--(1) Section 706 of such title is 
amended by inserting ``or 1182(c)(2)'' after ``section 876a'' in 
subsections (a), (b), and (c).
    (2) The heading for such section is amended to read as follows:
``Sec. 706. Administration of required leave''.
    (d) Clerical Amendments.--The table of sections at the beginning of 
chapter 40 of title 10, United States Code, is amended--
            (1) by striking the item relating to section 706 and 
        inserting the following:

``706. Administration of required leave.'';
        and
            (2) by inserting after the item relating to section 707 the 
        following new item:

``707a. Payment upon disapproval of certain board of inquiry 
                            recommendations for excess leave required 
                            to be taken.''.

SEC. 553. STIPEND FOR PARTICIPATION IN FUNERAL HONORS DETAILS.

    Section 1491(d) of title 10, United States Code, is amended--
            (1) by striking paragraph (1) and inserting the following:
            ``(A) For a participant in the funeral honors detail who is 
        a member or former member of the armed forces in a retired 
        status or is not a member of the armed forces (other than a 
        former member in a retired status) and not an employee of the 
        United States, either--
                    ``(i) transportation; or
                    ``(ii) a daily stipend prescribed annually by the 
                Secretary of Defense at a single rate that is designed 
                to defray the costs for transportation and other 
                expenses incurred by the participant in connection with 
                participation in the funeral honors detail.'';
            (2) by inserting ``(1)'' after ``(d) Support.--'';
            (3) by redesignating paragraph (2) as subparagraph (B);
            (4) in subparagraph (B), as so redesignated, by inserting 
        ``members of the armed forces in a retired status and'' after 
        ``training for''; and
            (5) by adding at the end the following:
    ``(2) A stipend paid under paragraph (1)(A) to a member or former 
member of the armed forces in a retired status shall be in addition to 
any other compensation to which the retired member may be entitled.''.

          TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS

                     Subtitle A--Pay and Allowances

SEC. 601. INCREASE IN BASIC PAY FOR FISCAL YEAR 2003.

    (a) Waiver of Section 1009 Adjustment.--The adjustment to become 
effective during fiscal year 2003 required by section 1009 of title 37, 
United States Code, in the rates of monthly basic pay authorized 
members of the uniformed services shall not be made.
    (b) Increase in Basic Pay.--Effective on January 1, 2003, the rates 
of monthly basic pay for members of the uniformed services within each 
pay grade are as follows:
      

                        COMMISSIONED OFFICERS\1\
 Years of service computed under section 205 of title 37, United States
                                  Code
------------------------------------------------------------------------
    Pay Grade     2 or less    Over 2     Over 3     Over 4     Over 6
------------------------------------------------------------------------
O-10\2\.........      $0.00      $0.00      $0.00      $0.00       $0.00
O-9.............       0.00       0.00       0.00       0.00        0.00
O-8.............   7,474.50   7,719.30   7,881.60   7,927.20    8,129.40
O-7.............   6,210.90   6,499.20   6,633.00   6,739.20    6,930.90
O-6.............   4,603.20   5,057.10   5,388.90   5,388.90    5,409.60
O-5.............   3,837.60   4,323.00   4,622.40   4,678.50    4,864.80
O-4.............   3,311.10   3,832.80   4,088.70   4,145.70    4,383.00
O-3\3\..........   2,911.20   3,300.30   3,562.20   3,883.50    4,069.50
O-2\3\..........   2,515.20   2,864.70   3,299.40   3,410.70    3,481.20
O-1\3\..........   2,183.70   2,272.50   2,746.80   2,746.80    2,746.80
                 -------------------------------------------------------
                    Over 8    Over 10    Over 12    Over 14     Over 16
                 -------------------------------------------------------
O-10\2\.........      $0.00      $0.00      $0.00      $0.00       $0.00
O-9.............       0.00       0.00       0.00       0.00        0.00
O-8.............   8,468.70   8,547.30   8,868.90   8,961.30    9,238.20
O-7.............   7,120.80   7,340.40   7,559.40   7,779.00    8,468.70
O-6.............   5,641.20   5,672.10   5,672.10   5,994.60    6,564.30
O-5.............   4,977.00   5,222.70   5,403.00   5,635.50    5,991.90
O-4.............   4,637.70   4,954.50   5,201.40   5,372.70    5,471.10
O-3\3\..........   4,273.50   4,405.80   4,623.30   4,736.10    4,736.10
O-2\3\..........   3,481.20   3,481.20   3,481.20   3,481.20    3,481.20
O-1\3\..........   2,746.80   2,746.80   2,746.80   2,746.80    2,746.80
                 -------------------------------------------------------
                   Over 18    Over 20    Over 22    Over 24     Over 26
                 -------------------------------------------------------
O-10\2\.........      $0.00  $12,077.7  $12,137.1  $12,389.4  $12,829.20
                                     0          0          0
O-9.............       0.00  10,563.60  10,715.70  10,935.60   11,319.60
O-8.............   9,639.00  10,008.90  10,255.80  10,255.80   10,255.80
O-7.............   9,051.30   9,051.30   9,051.30   9,051.30    9,096.90
O-6.............   6,898.80   7,233.30   7,423.50   7,616.10    7,989.90
O-5.............   6,161.70   6,329.10   6,519.60   6,519.60    6,519.60
O-4.............   5,528.40   5,528.40   5,528.40   5,528.40    5,528.40
O-3\3\..........   4,736.10   4,736.10   4,736.10   4,736.10    4,736.10
O-2\3\..........   3,481.20   3,481.20   3,481.20   3,481.20    3,481.20
O-1\3\..........   2,746.80   2,746.80   2,746,80   2,746.80    2,746.80
------------------------------------------------------------------------
\1\Notwithstanding the basic pay rates specified in this table, the
  actual rate of basic pay for commissioned officers in pay grades O-7
  through O-10 may not exceed the rate of pay for level III of the
  Executive Schedule and the actual rate of basic pay for all other
  officers may not exceed the rate of pay for level V of the Executive
  Schedule.
\2\Subject to the preceding footnote, while serving as Chairman or Vice
  Chairman of the Joint Chiefs of Staff, Chief of Staff of the Army,
  Chief of Naval Operations, Chief of Staff of the Air Force, Commandant
  of the Marine Corps, or Commandant of the Coast Guard, the rate of
  basic pay for this grade is $14,155.50, regardless of cumulative years
  of service computed under section 205 of title 37, United States Code.
\3\This table does not apply to commissioned officers in pay grade O-1,
  O-2, or O-3 who have been credited with over 4 years of active duty
  service as an enlisted member or warrant officer.


  COMMISSIONED OFFICERS WITH OVER 4 YEARS OF ACTIVE DUTY SERVICE AS AN
                   ENLISTED MEMBER OR WARRANT OFFICER
 Years of service computed under section 205 of title 37, United States
                                  Code
------------------------------------------------------------------------
    Pay Grade     2 or less    Over 2     Over 3     Over 4     Over 6
------------------------------------------------------------------------
O-3E............      $0.00      $0.00      $0.00   3,883.50    4,069.50
O-2E............       0.00       0.00       0.00   3,410.70    3,481.20
O-1E............       0.00       0.00       0.00   2,746.80    2,933.70
                 -------------------------------------------------------
                    Over 8    Over 10    Over 12    Over 14     Over 16
                 -------------------------------------------------------
O-3E............   4,273.50   4,405.80   4,623.30   4,806.30    4,911.00
O-2E............   3,591.90   3,778.80   3,923.40   4,031.10    4,031.10
O-1E............   3,042.00   3,152.70   3,261.60   3,410.70    3,410.70
                 -------------------------------------------------------
                   Over 18    Over 20    Over 22    Over 24     Over 26
                 -------------------------------------------------------
O-3E............   5,054.40   5,054.40   5,054.40   5,054.40    5,054.40
O-2E............   4,031.10   4,031.10   4,031.10   4,031.10    4,031.10
O-1E............   3,410.70   3,410.70   3,410.70   3,410.70    3,410.70
------------------------------------------------------------------------


                           WARRANT OFFICERS\1\
 Years of service computed under section 205 of title 37, United States
                                  Code
------------------------------------------------------------------------
    Pay Grade      2 or less    Over 2     Over 3     Over 4     Over 6
------------------------------------------------------------------------
W-5..............      $0.00      $0.00      $0.00      $0.00      $0.00
W-4..............   3,008.10   3,236.10   3,329.10   3,420.60   3,578.10
W-3..............   2,747.10   2,862.00   2,979.30   3,017.70   3,141.00
W-2..............   2,416.50   2,554.50   2,675.10   2,763.00   2,838.30
W-1..............   2,133.90   2,308.50   2,425.50   2,501.10   2,662.50
                  ------------------------------------------------------
                     Over 8    Over 10    Over 12    Over 14    Over 16
                  ------------------------------------------------------
W-5..............      $0.00      $0.00      $0.00      $0.00      $0.00
W-4..............   3,733.50   3,891.00   4,044.60   4,203.60   4,356.00
W-3..............   3,281.70   3,467.40   3,580.50   3,771.90   3,915.60
W-2..............   2,993.10   3,148.50   3,264.00   3,376.50   3,453.90
W-1..............   2,782.20   2,888.40   3,006.90   3,085.20   3,203.40
                  ------------------------------------------------------
                    Over 18    Over 20    Over 22    Over 24    Over 26
                  ------------------------------------------------------
W-5..............      $0.00   5,169.30   5,346.60   5,524.50   5,703.30
W-4..............   4,512.00   4,664.40   4,822.50   4,978.20   5,137.50
W-3..............   4,058.40   4,201.50   4,266.30   4,407.00   4,548.00
W-2..............   3,579.90   3,705.90   3,831.00   3,957.30   3,957.30
W-1..............   3,320.70   3,409.50   3,409.50   3,409.50   3,409.50
------------------------------------------------------------------------
\1\Notwithstanding the basic pay rates specified in this table, the
  actual rate of basic pay for warrant officers may not exceed the rate
  of pay for level V of the Executive Schedule.


                           ENLISTED MEMBERS\1\
 Years of service computed under section 205 of title 37, United States
                                  Code
------------------------------------------------------------------------
    Pay Grade      2 or less    Over 2     Over 3     Over 4     Over 6
------------------------------------------------------------------------
E-9\2\...........      $0.00      $0.00      $0.00      $0.00      $0.00
E-8..............       0.00       0.00       0.00       0.00       0.00
E-7..............   2,068.50   2,257.80   2,343.90   2,428.20   2,516.40
E-6..............   1,770.60   1,947.60   2,033.70   2,117.10   2,204.10
E-5..............   1,625.40   1,733.70   1,817.40   1,903.50   2,037.00
E-4..............   1,502.70   1,579.80   1,665.30   1,749.30   1,824.00
E-3..............   1,356.90   1,442.10   1,528.80   1,528.80   1,528.80
E-2..............   1,290.00   1,290.00   1,290.00   1,290.00   1,290.00
E-1\3\...........   1,150.80   1,150.80   1,150.80   1,150.80   1,150.80
                  ------------------------------------------------------
                     Over 8    Over 10    Over 12    Over 14    Over 16
                  ------------------------------------------------------
E-9\2\...........      $0.00  $3,564.30  $3,645.00  $3,747.00  $3,867.00
E-8..............   2,975.40   3,061.20   3,141.30   3,237.60   3,342.00
E-7..............   2,667.90   2,753.40   2,838.30   2,990.40   3,066.30
E-6..............   2,400.90   2,477.40   2,562.30   2,636.70   2,663.10
E-5..............   2,151.90   2,236.80   2,283.30   2,283.30   2,283.30
E-4..............   1,824.00   1,824.00   1,824.00   1,824.00   1,824.00
E-3..............   1,528.80   1,528.80   1,528.80   1,528.80   1,528.80
E-2..............   1,290.00   1,290.00   1,290.00   1,290.00   1,290.00
E-1\3\...........   1,150.80   1,150.80   1,150.80   1,150.80   1,150.80
                  ------------------------------------------------------
                    Over 18    Over 20    Over 22    Over 24    Over 26
                  ------------------------------------------------------
E-9\2\...........  $3,987.30  $4,180.80  $4,344.30  $4,506.30  $4,757.40
E-8..............   3,530.10   3,625.50   3,787.50   3,877.50   4,099.20
E-7..............   3,138.60   3,182.70   3,331.50   3,427.80   3,671.40
E-6..............   2,709.60   2,709.60   2,709.60   2,709.60   2,709.60
E-5..............   2,283.30   2,283.30   2,283.30   2,283.30   2,283.30
E-4..............   1,824.00   1,824.00   1,824.00   1,824.00   1,824.00
E-3..............   1,528.80   1,528.80   1,528.80   1,528.80   1,528.80
E-2..............   1,290.00   1,290.00   1,290.00   1,290.00   1,290.00
E-1\3\...........   1,150.80   1,150.80   1,150.80   1,150.80   1,150.80
------------------------------------------------------------------------
\1\Notwithstanding the basic pay rates specified in this table, the
  actual rate of basic pay for enlisted members may not exceed the rate
  of pay for level V of the Executive Schedule.
\2\Subject to the preceding footnote, while serving as Sergeant Major of
  the Army, Master Chief Petty Officer of the Navy, Chief Master
  Sergeant of the Air Force, Sergeant Major of the Marine Corps, or
  Master Chief Petty Officer of the Coast Guard, the rate of basic pay
  for this grade is $5,732.70, regardless of cumulative years of service
  computed under section 205 of title 37, United States Code.
\3\In the case of members in pay grade E-1 who have served less than 4
  months on active duty, the rate of basic pay is $1,064.70.

SEC. 602. RATE OF BASIC ALLOWANCE FOR SUBSISTENCE FOR ENLISTED 
              PERSONNEL OCCUPYING SINGLE GOVERNMENT QUARTERS WITHOUT 
              ADEQUATE AVAILABILITY OF MEALS.

    (a) Authority To Pay Increased Rate.--Section 402(d) of title 37, 
United States Code, is amended to read as follows:
    ``(d) Special Rate for Enlisted Members Occupying Single Quarters 
Without Adequate Availability of Meals.--The Secretary of Defense, and 
the Secretary of Transportation with respect to the Coast Guard when it 
is not operating as a service in the Navy, may pay an enlisted member 
the basic allowance for subsistence under this section at a monthly 
rate that is twice the amount in effect under subsection (b)(2) while--
            ``(1) the member is assigned to single Government quarters 
        which have no adequate food storage or preparation facility in 
        the quarters; and
            ``(2) there is no Government messing facility serving those 
        quarters that is capable of making meals available to the 
        occupants of the quarters.''.
    (b) Effective Date.--Subsection (a) and the amendment made by such 
subsection shall take effect on October 1, 2002.

SEC. 603. BASIC ALLOWANCE FOR HOUSING IN CASES OF LOW-COST OR NO-COST 
              MOVES.

    Section 403 of title 37, United States Code, is amended--
            (1) by transferring paragraph (7) of subsection (b) to the 
        end of the section; and
            (2) in such paragraph--
                    (A) by striking ``(7)'' and all that follows 
                through ``circumstances of which make it necessary that 
                the member be'' and inserting ``(o) Treatment of Low-
                Cost and No-Cost Moves as Not Being Reassignments.--In 
                the case of a member who is assigned to duty at a 
                location or under circumstances that make it necessary 
                for the member to be''; and
                    (B) by inserting ``for the purposes of this 
                section'' after ``may be treated''.

           Subtitle B--Bonuses and Special and Incentive Pays

SEC. 611. ONE-YEAR EXTENSION OF CERTAIN BONUS AND SPECIAL PAY 
              AUTHORITIES FOR RESERVE FORCES.

    (a) Selected Reserve Reenlistment Bonus.--Section 308b(f) of title 
37, United States Code, is amended by striking ``December 31, 2002'' 
and inserting ``December 31, 2003''.
    (b) Selected Reserve Enlistment Bonus.--Section 308c(e) of such 
title is amended by striking ``December 31, 2002'' and inserting 
``December 31, 2003''.
    (c) Special Pay for Enlisted Members Assigned to Certain High 
Priority Units.--Section 308d(c) of such title is amended by striking 
``December 31, 2002'' and inserting ``December 31, 2003''.
    (d) Selected Reserve Affiliation Bonus.--Section 308e(e) of such 
title is amended by striking ``December 31, 2002'' and inserting 
``December 31, 2003''.
    (e) Ready Reserve Enlistment and Reenlistment Bonus.--Section 
308h(g) of such title is amended by striking ``December 31, 2002'' and 
inserting ``December 31, 2003''.
    (f) Prior Service Enlistment Bonus.--Section 308i(f) of such title 
is amended by striking ``December 31, 2002'' and inserting ``December 
31, 2003''.

SEC. 612. ONE-YEAR EXTENSION OF CERTAIN BONUS AND SPECIAL PAY 
              AUTHORITIES FOR CERTAIN HEALTH CARE PROFESSIONALS.

    (a) Nurse Officer Candidate Accession Program.--Section 2130a(a)(1) 
of title 10, United States Code, is amended by striking ``December 31, 
2002'' and inserting ``December 31, 2003''.
    (b) Repayment of Education Loans for Certain Health Professionals 
Who Serve in the Selected Reserve.--Section 16302(d) of such title is 
amended by striking ``January 1, 2003'' and inserting ``January 1, 
2004''.
    (c) Accession Bonus for Registered Nurses.--Section 302d(a)(1) of 
title 37, United States Code, is amended by striking ``December 31, 
2002'' and inserting ``December 31, 2003''.
    (d) Incentive Special Pay for Nurse Anesthetists.--Section 
302e(a)(1) of such title is amended by striking ``December 31, 2002'' 
and inserting ``December 31, 2003''.
    (e) Special Pay for Selected Reserve Health Professionals in 
Critically Short Wartime Specialties.--Section 302g(f) of such title is 
amended by striking ``December 31, 2002'' and inserting ``December 31, 
2003''.
    (f) Accession Bonus for Dental Officers.--Section 302h(a)(1) of 
such title is amended by striking ``December 31, 2002'' and inserting 
``December 31, 2003''.

SEC. 613. ONE-YEAR EXTENSION OF SPECIAL PAY AND BONUS AUTHORITIES FOR 
              NUCLEAR OFFICERS.

    (a) Special Pay for Nuclear-Qualified Officers Extending Period of 
Active Service.--Section 312(e) of title 37, United States Code, is 
amended by striking ``December 31, 2002'' and inserting ``December 31, 
2003''.
    (b) Nuclear Career Accession Bonus.--Section 312b(c) of such title 
is amended by striking ``December 31, 2002'' and inserting ``December 
31, 2003''.
    (c) Nuclear Career Annual Incentive Bonus.--Section 312c(d) of such 
title is amended by striking ``December 31, 2002'' and inserting 
``December 31, 2003''.

SEC. 614. ONE-YEAR EXTENSION OF OTHER BONUS AND SPECIAL PAY 
              AUTHORITIES.

    (a) Aviation Officer Retention Bonus.--Section 301b(a) of title 37, 
United States Code, is amended by striking ``December 31, 2002'' and 
inserting ``December 31, 2003''.
    (b) Reenlistment Bonus for Active Members.--Section 308(g) of such 
title is amended by striking ``December 31, 2002'' and inserting 
``December 31, 2003''.
    (c) Enlistment Bonus for Active Members.--Section 309(e) of such 
title is amended by striking ``December 31, 2002'' and inserting 
``December 31, 2003''.
    (d) Retention Bonus for Members With Critical Military Skills.--
Section 323(i) of such title is amended by striking ``December 31, 
2002'' and inserting ``December 31, 2003''.
    (e) Accession Bonus for New Officers in Critical Skills.--Section 
324(g) of such title is amended by striking ``December 31, 2002'' and 
inserting ``December 31, 2003''.

SEC. 615. INCREASED MAXIMUM AMOUNT PAYABLE AS MULTIYEAR RETENTION BONUS 
              FOR MEDICAL OFFICERS OF THE ARMED FORCES.

    Section 301d(a)(2) of title 37, United States Code, is amended by 
striking ``$14,000'' and inserting ``$25,000''.

SEC. 616. INCREASED MAXIMUM AMOUNT PAYABLE AS INCENTIVE SPECIAL PAY FOR 
              MEDICAL OFFICERS OF THE ARMED FORCES.

    Section 302(b)(1) of title 37, United States Code, is amended--
            (1) by striking ``fiscal year 1992, and'' in the second 
        sentence and inserting ``fiscal year 1992,''; and
            (2) by inserting before the period at the end of such 
        sentence the following: ``and before fiscal year 2003, and 
        $50,000 for any twelve-month period beginning after fiscal year 
        2002''.

SEC. 617. ASSIGNMENT INCENTIVE PAY.

    (a) Authority.--(1) Chapter 5 of title 37, United States Code, is 
amended by inserting after section 305a the following new section:
``Sec. 305b. Special pay: assignment incentive pay
    ``(a) Authority.--The Secretary concerned, with the concurrence of 
the Secretary of Defense, may pay monthly incentive pay under this 
section to a member of a uniformed service for a period that the member 
performs service, while entitled to basic pay, in an assignment that is 
designated by the Secretary concerned.
    ``(b) Maximum Rate.--The maximum monthly rate of incentive pay 
payable to a member under this section is $1,500.
    ``(c) Relationship to Other Pay and Allowances.--Incentive pay paid 
to a member under this section is in addition to any other pay and 
allowances to which the member is entitled.
    ``(d) Status Not Affected by Temporary Duty or Leave.--The service 
of a member in an assignment referred to in subsection (a) shall not be 
considered discontinued during any period that the member is not 
performing service in such assignment by reason of temporary duty 
performed by the member pursuant to orders or absence of the member for 
authorized leave.
    ``(e) Termination of Authority.--No assignment incentive pay may be 
paid under this section for months beginning more than three years 
after the date of the enactment of the National Defense Authorization 
Act for Fiscal Year 2003.''.
    (2) The table of sections at the beginning of such chapter is 
amended by inserting after the item relating to section 305a the 
following new item:

``305b. Special pay: assignment incentive pay.''.
    (b) Annual Report.--Not later than February 28 of each of 2004 and 
2005, the Secretary of Defense shall submit to the Committees on Armed 
Services of the Senate and the House of Representatives a report on the 
administration of the authority under section 305b of title 37, United 
States Code, as added by subsection (a). The report shall include an 
assessment of the utility of that authority.

SEC. 618. INCREASED MAXIMUM AMOUNTS FOR PRIOR SERVICE ENLISTMENT BONUS.

    Section 308i(b)(1) of title 37, United States Code, is amended--
            (1) in subparagraph (A), by striking ``$5,000'' and 
        inserting ``$8,000'';
            (2) in subparagraph (B), by striking ``$2,500'' and 
        inserting ``$4,000''; and
            (3) in subparagraph (C), by striking ``$2,000'' and 
        inserting ``$3,500''.

            Subtitle C--Travel and Transportation Allowances

SEC. 631. DEFERRAL OF TRAVEL IN CONNECTION WITH LEAVE BETWEEN 
              CONSECUTIVE OVERSEAS TOURS.

    (a) Date to Which Travel May Be Deferred.--Section 411b(a)(2) of 
title 37, United States Code, is amended by striking ``not more than 
one year'' in the first sentence and all that follows through 
``operation ends.'' in the second sentence and inserting the following: 
``the date on which the member departs the duty station in termination 
of the consecutive tour of duty at that duty station or reports to 
another duty station under the order involved, as the case may be.''.
    (b) Effective Date and Savings Provision.--(1) The amendment made 
by subsection (a) shall take effect on October 1, 2002.
    (2) Section 411b(a) of title 37, United States Code, as in effect 
on September 30, 2002, shall continue to apply with respect to travel 
described in subsection (a)(2) of such title (as in effect on such 
date) that commences before October 1, 2002.

SEC. 632. TRANSPORTATION OF MOTOR VEHICLES FOR MEMBERS REPORTED 
              MISSING.

    (a) Authority To Ship Two Motor Vehicles.--Subsection (a) of 
section 554 of title 37, United States Code, is amended by striking 
``one privately owned motor vehicle'' both places it appears and 
inserting ``two privately owned motor vehicles''.
    (b) Payments for Late Delivery.--Subsection (i) of such section is 
amended by adding at the end the following: ``In a case in which two 
motor vehicles of a member (or the dependent or dependents of a member) 
are transported at the expense of the United States, no reimbursement 
is payable under this subsection unless both motor vehicles do not 
arrive at the authorized destination of the vehicles by the designated 
delivery date.''.
    (c) Applicability.--The amendments made by subsection (a) shall 
apply with respect to members whose eligibility for benefits under 
section 554 of title 37, United States Code, commences on or after the 
date of the enactment of this Act.

SEC. 633. DESTINATIONS AUTHORIZED FOR GOVERNMENT PAID TRANSPORTATION OF 
              ENLISTED PERSONNEL FOR REST AND RECUPERATION UPON 
              EXTENDING DUTY AT DESIGNATED OVERSEAS LOCATIONS.

    Section 705(b)(2) of title 10, United States Code, is amended by 
inserting before the period at the end the following: ``, or to an 
alternative destination at a cost not to exceed the cost of the round-
trip transportation from the location of the extended tour of duty to 
such nearest port and return''.

SEC. 634. VEHICLE STORAGE IN LIEU OF TRANSPORTATION TO CERTAIN AREAS OF 
              THE UNITED STATES OUTSIDE CONTINENTAL UNITED STATES.

    Section 2634(b) of title 10, United States Code, is amended:
            (1) by redesignating paragraphs (2), (3), and (4) as 
        paragraphs (3), (4), and (5), respectively; and
            (2) by inserting after paragraph (1) the following new 
        paragraph (2):
    ``(2) In lieu of transportation authorized by this section, if a 
member is ordered to make a change of permanent station to Alaska, 
Hawaii, Puerto Rico, the Northern Mariana Islands, Guam, or any 
territory or possession of the United States and laws, regulations, or 
other restrictions preclude transportation of a motor vehicle described 
in subsection (a) to the new station, the member may elect to have the 
vehicle stored at the expense of the United States at a location 
approved by the Secretary concerned.''.

          Subtitle D--Retirement and Survivor Benefit Matters

SEC. 641. PHASED-IN AUTHORITY FOR CONCURRENT RECEIPT OF MILITARY 
              RETIRED PAY AND VETERANS' DISABILITY COMPENSATION FOR 
              CERTAIN SERVICE-CONNECTED DISABLED VETERANS.

    (a) In General.--(1) Section 1414 of title 10, United States Code, 
is amended to read as follows:
``Sec. 1414. Members eligible for retired pay who have service-
              connected disabilities: payment of retired pay and 
              veterans' disability compensation for disabilities rated 
              at 60 percent or higher
    ``(a) Payment of Both Retired Pay and Compensation.--A member or 
former member of the uniformed services described in subsection (b) is 
entitled to be paid retired pay, up to the amount determined for such 
member or former member under subsection (d), in addition to any 
entitlement to veterans' disability compensation, without regard to 
sections 5304 and 5305 of title 38.
    ``(b) Covered Members.--A member or former member described in this 
subsection is any member or former member who is entitled to retired 
pay (other than as specified in subsection (c)) and who is also 
entitled to veterans' disability compensation for a service-connected 
disability rated at 60 percent or higher, as determined under laws 
administered by the Secretary of Veterans Affairs.
    ``(c) Exception.--Subsection (a) does not apply to a member retired 
under chapter 61 of this title with less than 20 years of service 
otherwise creditable under section 1405 of this title at the time of 
the member's retirement.
    ``(d) Maximum Amount of Retired Pay.--The maximum amount of retired 
pay to which a member or former member is entitled under subsection (a) 
is as follows:
            ``(1) For months beginning with January 2003 and ending 
        with December 2003, the amount equal to 30 percent of the 
        amount of retired pay to which the member or former member 
        would be entitled if the member or former member were paid 
        retired pay without regard to sections 5304 and 5305 of title 
        38 for such months.
            ``(2) For months beginning with January 2004 and ending 
        with December 2004, the amount equal to 45 percent of the 
        amount of retired pay to which the member or former member 
        would be entitled if the member or former member were paid 
        retired pay without regard to sections 5304 and 5305 of title 
        38 for such months.
            ``(3) For months beginning with January 2005 and ending 
        with December 2005, the amount equal to 60 percent of the 
        amount of retired pay to which the member or former member 
        would be entitled if the member or former member were paid 
        retired pay without regard to sections 5304 and 5305 of title 
        38 for such months.
            ``(4) For months beginning with January 2006 and ending 
        with December 2006, the amount equal to 80 percent of the 
        amount of retired pay to which the member or former member 
        would be entitled if the member or former member were paid 
        retired pay without regard to sections 5304 and 5305 of title 
        38 for such months.
            ``(5) For months beginning after December 2006, the amount 
        equal to the full amount of retired pay to which the member or 
        former member would be entitled if the member or former member 
        were paid retired pay without regard to sections 5304 and 5305 
        of title 38 for such months.
    ``(e) Definitions.--In this section:
            ``(1) The term `retired pay' includes retainer pay, 
        emergency officers' retirement pay, and naval pension.
            ``(2) The term `service-connected' has the meaning given 
        that term in section 101(16) of title 38.
            ``(3) The term `veterans' disability compensation' has the 
        meaning given the term `compensation' in section 101(12) of 
        title 38.''.
    (2) The table of sections at the beginning of chapter 71 of such 
title is amended by striking the item relating to section 1414 and 
inserting the following new item:

``1414. Members eligible for retired pay who have service-connected 
                            disabilities: payment of retired pay and 
                            veterans' disability compensation for 
                            disabilities rated at 60 percent or 
                            higher.''.
    (b) Coordination with Special Compensation Authority.--Section 1413 
of such title is amended--
            (1) in subsection (a)--
                    (A) by inserting ``, for months in 2002,'' after 
                ``Secretary concerned shall''; and
                    (B) by striking the last sentence; and
            (2) in subsection (b), by striking ``is the following:'' 
        and all that follows and inserting ``is--
            ``(1) for any month in 2002 for which the retiree has a 
        qualifying service-connected disability rated as total, $300;
            ``(2) for any month in 2002 for which the retiree has a 
        qualifying service-connected disability rated as 90 percent, 
        $200;
            ``(3) for any month in 2002 for which the retiree has a 
        qualifying service-connected disability rated as 80 percent or 
        70 percent, $100; or
            ``(4) for any month in 2002 for which the retiree has a 
        qualifying service-connected disability rated as 60 percent, 
        $50.''.
    (c) Additional Conforming Amendment.--Subsection (d) of section 641 
of the National Defense Authorization Act for Fiscal Year 2002 (Public 
Law 107-107; 115 Stat. 1150; 10 U.S.C. 1414 note) is repealed.

SEC. 642. INCREASED RETIRED PAY FOR ENLISTED RESERVES CREDITED WITH 
              EXTRAORDINARY HEROISM.

    (a) Authority.--Section 12739 of title 10, United States Code, is 
amended--
            (1) by redesignating subsections (b) and (c) as subsections 
        (c) and (d), respectively;
            (2) by inserting after subsection (a) the following new 
        subsection (b):
    ``(b) If an enlisted member retired under section 12731 of this 
title has been credited by the Secretary concerned with extraordinary 
heroism in the line of duty, the member's retired pay shall be 
increased by 10 percent of the amount determined under subsection (a). 
The Secretary's determination as to extraordinary heroism is conclusive 
for all purposes.''; and
            (3) in subsection (c), as redesignated by paragraph (1), by 
        striking ``amount computed under subsection (a),'' and 
        inserting ``total amount of the monthly retired pay computed 
        under subsections (a) and (b)''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect on October 1, 2002, and shall apply with respect to retired 
pay for months beginning on or after that date.

SEC. 643. EXPANDED SCOPE OF AUTHORITY TO WAIVE TIME LIMITATIONS ON 
              CLAIMS FOR MILITARY PERSONNEL BENEFITS.

    (a) Authority.--Section 3702(e)(1) of title 31, United States Code, 
is amended by striking ``a claim for pay, allowances, or payment for 
unused accrued leave under title 37 or a claim for retired pay under 
title 10'' and inserting ``a claim referred to in subsection 
(a)(1)(A)''.
    (b) Applicability.--The amendment made by subsection (a) shall 
apply with respect to claims presented to the Secretary of Defense 
under section 3702 of title 31, United States Code, on or after the 
date of the enactment of this Act.

                       Subtitle E--Other Matters

SEC. 651. ADDITIONAL AUTHORITY TO PROVIDE ASSISTANCE FOR FAMILIES OF 
              MEMBERS OF THE ARMED FORCES.

    (a) Authority.--(1) Subchapter I of chapter 88 of title 10, United 
States Code, is amended by adding at the end the following new section:
``Sec. 1788. Additional family assistance
    ``(a) Authority.--The Secretary of Defense may provide for the 
families of members of the armed forces serving on active duty, in 
addition to any other assistance available for such families, any 
assistance that the Secretary considers appropriate to ensure that the 
children of such members obtain needed child care, education, and other 
youth services.
    ``(b) Primary Purpose of Assistance.--The assistance authorized by 
this section should be directed primarily toward providing needed 
family support, including child care, education, and other youth 
services, for children of members of the Armed Forces who are deployed, 
assigned to duty, or ordered to active duty in connection with a 
contingency operation.''.
    (2) The table of sections at the beginning of such subchapter is 
amended by adding at the end the following new item:

``1788. Additional family assistance.''.
    (b) Effective Date.--Section 1788 of title 10, United States Code, 
as added by subsection (a), shall take effect on October 1, 2002.

SEC. 652. TIME LIMITATION FOR USE OF MONTGOMERY GI BILL ENTITLEMENT BY 
              MEMBERS OF THE SELECTED RESERVE.

    (a) Extension of Limitation Period.--Section 16133(a)(1) of title 
10, United States Code, is amended by striking ``10-year'' and 
inserting ``14-year''.
    (b) Effective Date and Applicability.--The amendment made by 
subsection (a) shall take effect on October 1, 2002, and shall apply 
with respect to periods of entitlement to educational assistance under 
chapter 1606 of title 10, United States Code, that begin on or after 
October 1, 1992.

SEC. 653. STATUS OF OBLIGATION TO REFUND EDUCATIONAL ASSISTANCE UPON 
              FAILURE TO PARTICIPATE SATISFACTORILY IN SELECTED 
              RESERVE.

    Section 16135 of title 10, United States Code, is amended by adding 
at the end the following new subsection:
    ``(c)(1) An obligation to pay a refund to the United States under 
subsection (a)(1)(B) in an amount determined under subsection (b) is, 
for all purposes, a debt owed to the United States.
    ``(2) A discharge in bankruptcy under title 11 that is entered for 
a person less than five years after the termination of the person's 
enlistment or other service described in subsection (a) does not 
discharge the person from a debt arising under this section with 
respect to that enlistment or other service.''.

SEC. 654. PROHIBITION ON ACCEPTANCE OF HONORARIA BY PERSONNEL AT 
              CERTAIN DEPARTMENT OF DEFENSE SCHOOLS.

    (a) Repeal of Exemption.--Section 542 of the National Defense 
Authorization Act for Fiscal Year 1993 (Public Law 102-484; 106 Stat. 
2413; 10 U.S.C. prec. 2161 note) is repealed.
    (b) Effective Date and Applicability.--The amendment made by 
subsection (a) shall take effect on October 1, 2002, and shall apply 
with respect to appearances made, speeches presented, and articles 
published on or after that date.

                         TITLE VII--HEALTH CARE

SEC. 701. ELIGIBILITY OF SURVIVING DEPENDENTS FOR TRICARE DENTAL 
              PROGRAM BENEFITS AFTER DISCONTINUANCE OF FORMER 
              ENROLLMENT.

    Section 1076a(k)(2) of title 10, United States Code, is amended by 
striking ``if the dependent is enrolled on the date of the death of the 
members in a dental benefits plan established under subsection (a)'' 
and inserting ``if, on the date of the death of the member, the 
dependent is enrolled in a dental benefits plan established under 
subsection (a) or is not enrolled in such a plan by reason of a 
discontinuance of a former enrollment under subsection (f)''.

SEC. 702. ADVANCE AUTHORIZATION FOR INPATIENT MENTAL HEALTH SERVICES.

    Section 1079(i)(3) of title 10, United States Code, is amended--
            (1) by inserting ``(A)'' after ``(3)'';
            (2) by striking ``Except in the case of an emergency,'' and 
        inserting ``Except as provided in subparagraphs (B) and (C),''; 
        and
            (3) by adding at the end the following new subparagraph:
    ``(B) Preadmission authorization for inpatient mental health 
services is not required under subparagraph (A) in the case of an 
emergency.
    ``(C) Preadmission authorization for inpatient mental health 
services is not required under subparagraph (A) in a case in which any 
benefits are payable for such services under part A of title XVIII of 
the Social Security Act (42 U.S.C. 1395c et seq.). The Secretary shall 
require, however, advance authorization for the continued provision of 
the inpatient mental health services after benefits cease to be payable 
for such services under part A of such title in such case.''.

SEC. 703. CONTINUED TRICARE ELIGIBILITY OF DEPENDENTS RESIDING AT 
              REMOTE LOCATIONS AFTER DEPARTURE OF SPONSORS FOR 
              UNACCOMPANIED ASSIGNMENTS.

    Section 1079(p) of title 10, United States Code, is amended--
            (1) in paragraph (1), by striking ``dependents referred to 
        in subsection (a) of a member of the uniformed services 
        referred to in section 1074(c)(3) of this title who are 
        residing with the member'' and inserting ``dependents described 
        in paragraph (3)'';
            (2) by redesignating paragraph (3) as paragraph (4); and
            (3) by inserting after paragraph (2), the following new 
        paragraph (3):
    ``(3) This subsection applies with respect to a dependent referred 
to in subsection (a) who--
            ``(A) is a dependent of a member of the uniformed services 
        referred to in section 1074(c)(3) of this title and is residing 
        with the member; or
            ``(B) is a dependent of a member who, after having served 
        in a duty assignment described in section 1074(c)(3) of this 
        title, has relocated without the dependent pursuant to orders 
        for a permanent change of duty station from a remote location 
        described in subparagraph (B)(ii) of such section where the 
        member and the dependent resided together while the member 
        served in such assignment, if the orders do not authorize 
        dependents to accompany the member to the new duty station at 
        the expense of the United States and the dependent continues to 
        reside at the same remote location.''.

SEC. 704. APPROVAL OF MEDICARE PROVIDERS AS TRICARE PROVIDERS.

    Section 1079 of title 10, United States Code, is amended by adding 
at the end the following new subsection:
    ``(q) A physician or other health care practitioner who is eligible 
to receive reimbursement for services provided under the Medicare 
Program under title XVIII of the Social Security Act (42 U.S.C. 1395 et 
seq.) shall be considered approved to provide medical care under this 
section and section 1086 of this title.''.

SEC. 705. CLAIMS INFORMATION.

    (a) Correspondence to Medicare Claims Information Requirements.--
Section 1095c of title 10, United States Code, is amended by adding at 
the end the following new subsection:
    ``(d) Correspondence to Medicare Claims Information Requirements.--
The Secretary of Defense, in consultation with the other administering 
Secretaries, shall limit the requirements for information in support of 
claims for payment for health care items and services provided under 
the TRICARE program so that the information required under the program 
is substantially the same as the information that would be required for 
claims for reimbursement for those items and services under title XVIII 
of the Social Security Act (42 U.S.C. 1395 et seq.).''.
    (b) Applicability.--The Secretary of Defense, in consultation with 
the other administering Secretaries referred to in section 1072(3) of 
title 10, United States Code, shall apply the limitations required 
under subsection (d) of section 1095c of such title (as added by 
subsection (a)) with respect to contracts entered into under the 
TRICARE program on or after October 1, 2002.

SEC. 706. DEPARTMENT OF DEFENSE MEDICARE-ELIGIBLE RETIREE HEALTH CARE 
              FUND.

    (a) Source of Funds for Monthly Accrual Payments Into the Fund.--
Section 1116(c) of title 10, United States Code, is amended by striking 
``health care programs'' and inserting ``pay of members''.
    (b) Mandatory Participation of Other Uniformed Services.--Section 
1111(c) of such title is amended--
            (1) in the first sentence, by striking ``may enter into an 
        agreement with any other administering Secretary'' and 
        inserting ``shall enter into an agreement with each other 
        administering Secretary''; and
            (2) in the second sentence, by striking ``Any such'' and 
        inserting ``The''.

SEC. 707. TECHNICAL CORRECTIONS RELATING TO TRANSITIONAL HEALTH CARE 
              FOR MEMBERS SEPARATED FROM ACTIVE DUTY.

    (a) Continued Applicability to Dependents.--Subsection (a)(1) of 
section 736 of the National Defense Authorization Act for Fiscal Year 
2002 (Public Law 107-107; 115 Stat. 1172) is amended to read as 
follows:
            ``(1) in paragraph (1), by striking `paragraph (2), a 
        member' and all that follows through `of the member),' and 
        inserting `paragraph (3), a member of the armed forces who is 
        separated from active duty as described in paragraph (2) (and 
        the dependents of the member)';''.
    (b) Clarification Regarding the Coast Guard.--Subsection (b)(2) of 
such section is amended to read as follows:
            ``(2) in subsection (e)--
                    ``(A) by striking the first sentence; and
                    ``(B) by striking `the Coast Guard' in the second 
                sentence and inserting `the members of the Coast Guard 
                and their dependents'.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect as of December 28, 2001, and as if included in the National 
Defense Authorization Act for Fiscal Year 2002 as enacted.

  TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED 
                                MATTERS

             Subtitle A--Major Defense Acquisition Programs

SEC. 801. BUY-TO-BUDGET ACQUISITION OF END ITEMS.

    (a) Authority.--(1) Chapter 131 of title 10, United States Code, is 
amended by adding at the end the following new section:
``Sec. 2228. Buy-to-budget acquisition: end items
    ``(a) Authority To Acquire Additional End Items.--Using funds 
available to the Department of Defense for the acquisition of an end 
item, the head of agency making the acquisition may acquire a higher 
quantity of the end item than the quantity specified for the end item 
in a law providing for the funding of that acquisition if that head of 
an agency makes each of the following findings:
            ``(1) The agency has an established requirement for the end 
        item that is expected to remain substantially unchanged 
        throughout the period of the acquisition.
            ``(2) It is possible to acquire the higher quantity of the 
        end item without additional funding because of production 
        efficiencies or other cost reductions.
            ``(3) The amount of the funds used for the acquisition of 
        the higher quantity of the end item will not exceed the amount 
        provided under that law for the acquisition of the end item.
            ``(4) The amount so provided is sufficient to ensure that 
        each unit of the end item acquired within the higher quantity 
        is fully funded as a complete end item.
    ``(b) Regulations.--The Secretary of Defense shall prescribe 
regulations for the administration of this section. The regulations 
shall include, at a minimum, the following:
            ``(1) The level of approval within the Department of 
        Defense that is required for a decision to acquire a higher 
        quantity of an end item under subsection (a).
            ``(2) Authority to exceed by up to 10 percent the quantity 
        of an end item approved in a justification and approval of the 
        use of procedures other than competitive procedures for the 
        acquisition of the end item under section 2304 of this title, 
        but only to the extent necessary to acquire a quantity of the 
        end item permitted in the exercise of authority under 
        subsection (a).
    ``(c) Notification of Congress.--The head of an agency is not 
required to notify Congress in advance regarding a decision under the 
authority of this section to acquire a higher quantity of an end item 
than is specified in a law described in subsection (a), but shall 
notify the congressional defense committees of the decision not later 
than 30 days after the date of the decision.
    ``(d) Waiver by Other Law.--A provision of law may not be construed 
as prohibiting the acquisition of a higher quantity of an end item 
under this section unless that provision of law--
            ``(1) specifically refers to this section; and
            ``(2) specifically states that the acquisition of the 
        higher quantity of the end item is prohibited notwithstanding 
        the authority provided in this section.
    ``(e) Definitions.--(1) For the purposes of this section, a 
quantity of an end item shall be considered specified in a law if the 
quantity is specified either in a provision of that law or in any 
related representation that is set forth separately in a table, chart, 
or explanatory text included in a joint explanatory statement or 
governing committee report accompanying the law.
    ``(2) In this section:
                    ``(A) The term `congressional defense committees' 
                means--
                            ``(i) the Committee on Armed Services and 
                        the Committee on Appropriations of the Senate; 
                        and
                            ``(ii) the Committee on Armed Services and 
                        the Committee on Appropriations of the House of 
                        Representatives.
                    ``(B) The term `head of an agency' means the 
                Secretary of Defense, the Secretary of the Army, the 
                Secretary of the Navy, and the Secretary of the Air 
                Force.''.
    (2) The table of sections at the beginning of such chapter is 
amended by adding at the end the following new item:

``2228. Buy-to-budget acquisition: end items.''.
    (b) Time for Issuance of Final Regulations.--The Secretary of 
Defense shall issue the final regulations under section 2228(b) of 
title 10, United States Code (as added by subsection (a)), not later 
than 120 days after the date of the enactment of this Act.

SEC. 802. REPORT TO CONGRESS ON INCREMENTAL ACQUISITION OF MAJOR 
              SYSTEMS.

    (a) Report Required.--Not later than 120 days after the date of the 
enactment of this Act, the Secretary  of Defense shall submit to the 
congressional defense committees a report on the approach that the 
Secretary plans to take to applying the requirements of chapter 144 of 
title 10, United States Code, sections 139, 181, 2366, 2399, and 2400 
of such title, Department of Defense Directive 5000.1, Department of 
Defense Instruction 5000.2, and Chairman of the Joint Chiefs of Staff 
Instruction 3170.01B, and other provisions of law and regulations 
applicable to incremental acquisition programs.
    (b) Content of Report.--The report shall, at a minimum, address the 
following matters:
            (1) The manner in which the Secretary plans to establish 
        and approve, for each increment of an incremental acquisition 
        program--
                    (A) operational requirements; and
                    (B) cost and schedule goals.
            (2) The manner in which the Secretary plans, for each 
        increment of an incremental acquisition program--
                    (A) to meet requirements for operational testing 
                and live fire testing;
                    (B) to monitor cost and schedule performance; and
                    (C) to comply with laws requiring reports to 
                Congress on results testing and on cost and schedule 
                performance.
            (3) The manner in which the Secretary plans to ensure that 
        each increment of an incremental acquisition program is 
        designed--
                    (A) to achieve interoperability within and among 
                United States forces and United States coalition 
                partners; and
                    (B) to optimize total system performance and 
                minimize total ownership costs by giving appropriate 
                consideration to--
                            (i) logistics planning;
                            (ii) manpower, personnel, and training;
                            (iii) human, environmental, safety, 
                        occupational health, accessibility, 
                        survivability, operational continuity, and 
                        security factors;
                            (iv) protection of critical program 
                        information; and
                            (v) spectrum management.
    (c) Definitions.--In this section:
            (1) The term ``incremental acquisition program'' means an 
        acquisition program that is to be conducted in discrete phases 
        or blocks, with each phase or block consisting of the planned 
        production and acquisition of one or more units of a major 
        system.
            (2) The term ``increment'' refers to one of the discrete 
        phases or blocks of an incremental acquisition program.
            (3) The term ``major system'' has the meaning given such 
        term in section 2302(5) of title 10, United States Code.

SEC. 803. PILOT PROGRAM FOR SPIRAL DEVELOPMENT OF MAJOR SYSTEMS.

    (a) Authority.--The Secretary of Defense is authorized to conduct a 
pilot program for the spiral development of major systems and to 
designate research and development programs of the military departments 
and Defense Agencies to participate in the pilot program.
    (b) Designation of Participating Programs.--(1) A research and 
development program for a major system of a military department or 
Defense Agency may be conducted as a spiral development program only if 
the Secretary of Defense approves a spiral development plan submitted 
by the Secretary of that military department or head of that Defense 
Agency, as the case may be, and designates the program as a participant 
in the pilot program under this section.
    (2) The Secretary of Defense shall submit a copy of each spiral 
development plan approved under this section to the congressional 
defense committees.
    (c) Spiral Development Plans.--A spiral development plan for a 
participating program shall, at a minimum, include the following 
matters:
            (1) A rationale for dividing the program into separate 
        spirals, together with a preliminary identification of the 
        spirals to be included.
            (2) A program strategy, including overall cost, schedule, 
        and performance goals for the total program.
            (3) Specific cost, schedule, and performance parameters, 
        including measurable exit criteria, for the first spiral to be 
        conducted.
            (4) A testing plan to ensure that performance goals, 
        parameters, and exit criteria are met.
            (5) An appropriate limitation on the number of prototype 
        units that may be produced under the program.
            (6) Specific performance parameters, including measurable 
        exit criteria, that must be met before the program proceeds 
        into production of units in excess of the limitation on the 
        number of prototype units.
    (d) Guidance.--Not later than 120 days after the date of the 
enactment of this Act, the Secretary of Defense shall issue guidance 
for the implementation of the spiral development pilot program 
authorized by this section. The guidance shall, at a minimum, include 
the following matters:
            (1) A process for the development, review, and approval of 
        each spiral development plan submitted by the Secretary of a 
        military department or head of a Defense Agency.
            (2) A process for establishing and approving specific cost, 
        schedule, and performance parameters, including measurable exit 
        criteria, for spirals to be conducted after the first spiral.
            (3) Appropriate planning, testing, reporting, oversight, 
        and other requirements to ensure that the spiral development 
        program--
                    (A) satisfies realistic and clearly-defined 
                performance standards, cost objectives, and schedule 
                parameters (including measurable exit criteria for each 
                spiral);
                    (B) achieve interoperability within and among 
                United States forces and United States coalition 
                partners; and
                    (C) optimize total system performance and minimize 
                total ownership costs by giving appropriate 
                consideration to--
                            (i) logistics planning;
                            (ii) manpower, personnel, and training;
                            (iii) human, environmental, safety, 
                        occupational health, accessibility, 
                        survivability, operational continuity, and 
                        security factors;
                            (iv) protection of critical program 
                        information; and
                            (v) spectrum management.
            (4) A process for independent validation of the 
        satisfaction of exit criteria and other relevant requirements.
            (5) A process for operational testing of fieldable 
        prototypes to be conducted before or in conjunction with the 
        fielding of the prototypes.
    (e) Reporting Requirement.--The Secretary shall submit to Congress 
at the end of each quarter of a fiscal year a status report on each 
research and development program that is a participant in the pilot 
program. The report shall contain information on unit costs that is 
similar to the information on unit costs under major defense 
acquisition programs that is required to be provided to Congress under 
chapter 144 of title 10, United States Code, except that the 
information on unit costs shall address projected prototype costs 
instead of production costs.
    (f) Applicability of Existing Law.--Nothing in this section shall 
be construed to exempt any program of the Department of Defense from 
the application of any provision of chapter 144 of title 10, United 
States Code, section 139, 181, 2366, 2399, or 2400 of such title, or 
any requirement under Department of Defense Directive 5000.1, 
Department of Defense Instruction 5000.2, or Chairman of the Joint 
Chiefs of Staff Instruction 3170.01B in accordance with the terms of 
such provision or requirement.
    (g) Termination of Program Participation.--The conduct of a 
participating program as a spiral development program under the pilot 
program shall terminate when the decision is made for the participating 
program to proceed into the production of units in excess of the number 
of prototype units permitted under the limitation provided in spiral 
development plan for the program pursuant to subsection (c)(5).
    (h) Termination of Pilot Program.--(1) The authority to conduct a 
pilot program under this section shall terminate three years after the 
date of the enactment of this Act.
    (2) The termination of the pilot program shall not terminate the 
authority of the Secretary of a military department or head of a 
Defense Agency to continue to conduct, as a spiral development program, 
any research and development program that was designated to participate 
in the pilot program before the date on which the pilot program 
terminates. In the continued conduct of such a research and development 
program as a spiral development program on and after such date, the 
spiral development plan approved for the program, the guidance issued 
under subsection (d), and subsections (e), (f), and (g) shall continue 
to apply.
    (i) Definitions.--In this section:
            (1) The term ``spiral development program'' means a 
        research and development program that--
                    (A) is conducted in discrete phases or blocks, each 
                of which will result in the development of fieldable 
                prototypes; and
                    (B) will not proceed into acquisition until 
                specific performance parameters, including measurable 
                exit criteria, have been met.
            (2) The term ``spiral'' means one of the discrete phases or 
        blocks of a spiral development program.
            (3) The term ``major system'' has the meaning given such 
        term in section 2302(5) of title 10, United States Code.
            (4) The term ``participating program'' means a research and 
        development program that is designated to participate in the 
        pilot program under subsection (b).

SEC. 804. IMPROVEMENT OF SOFTWARE ACQUISITION PROCESSES.

    (a) Establishment of Programs.--(1) The Secretary of each military 
department shall establish a program to improve the software 
acquisition processes of that military department.
    (2) The head of each Defense Agency that manages a major defense 
acquisition program with a substantial software component shall 
establish a program to improve the software acquisition processes of 
that Defense Agency.
    (3) The programs required by this subsection shall be established 
not later than 120 days after the date of the enactment of this Act.
    (b) Program Requirements.--A program to improve software 
acquisition processes under this section shall, at a minimum, include 
the following:
            (1) A documented process for software acquisition planning, 
        requirements development and management, project management and 
        oversight, and risk management.
            (2) Efforts to develop systems for performance measurement 
        and continual process improvement.
            (3) A system for ensuring that each program office with 
        substantial software responsibilities implements and adheres to 
        established processes and requirements.
    (c) Department of Defense Guidance.--The Assistant Secretary of 
Defense for Command, Control, Communications, and Intelligence, in 
consultation with the Under Secretary of Defense for Acquisition, 
Technology, and Logistics, shall--
            (1) prescribe uniformly applicable guidance for the 
        administration of all of the programs established under 
        subsection (a) and take such actions as are necessary to ensure 
        that the military departments and Defense Agencies comply with 
        the guidance; and
            (2) assist the Secretaries of the military departments and 
        the heads of the Defense Agencies to carry out such programs 
effectively by identifying, and serving as a clearinghouse for 
information regarding, best practices in software acquisition processes 
in both the public and private sectors.
    (d) Definitions.--In this section:
            (1) The term ``Defense Agency'' has the meaning given the 
        term in section 101(a)(11) of title 10, United States Code.
            (2) The term ``major defense acquisition program'' has the 
        meaning given the term in section 2430 of title 10, United 
        States Code.

SEC. 805. INDEPENDENT TECHNOLOGY READINESS ASSESSMENTS.

    Section 804(b) of the National Defense Authorization Act for Fiscal 
Year 2002 (Public Law 107-107; 115 Stat. 1180) is amended--
            (1) by striking ``and'' at the end of paragraph (1);
            (2) by striking the period at the end of paragraph (2) and 
        inserting ``; and''; and
            (3) by adding at the end the following new paragraph:
            ``(3) identify each case in which an authoritative decision 
        has been made within the Department of Defense not to conduct 
        an independent technology readiness assessment for a critical 
        technology on a major defense acquisition program and explain 
        the reasons for the decision.''.

SEC. 806. TIMING OF CERTIFICATION IN CONNECTION WITH WAIVER OF 
              SURVIVABILITY AND LETHALITY TESTING REQUIREMENTS.

    (a) Certification for Expedited Programs.--Paragraph (1) of 
subsection (c) of section 2366 of title 10, United States Code, is 
amended to read as follows:
    ``(1) The Secretary of Defense may waive the application of the 
survivability and lethality tests of this section to a covered system, 
munitions program, missile program, or covered product improvement 
program if the Secretary determines that live-fire testing of such 
system or program would be unreasonably expensive and impractical and 
submits a certification of that determination to Congress--
            ``(A) before Milestone B approval for the system or 
        program; or
            ``(B) in the case of a system or program initiated at--
                    ``(i) Milestone B, as soon as is practicable after 
                the Milestone B approval; or
                    ``(ii) Milestone C, as soon as is practicable after 
                the Milestone C approval.''.
    (b) Definitions.--Subsection (e) of such section is amended by 
adding at the end the following new paragraphs:
            ``(8) The term `Milestone B approval' means a decision to 
        enter into system development and demonstration pursuant to 
        guidance prescribed by the Secretary of Defense for the 
        management of Department of Defense acquisition programs.
            ``(9) The term `Milestone C approval' means a decision to 
        enter into production and deployment pursuant to guidance 
        prescribed by the Secretary of Defense for the management of 
        Department of Defense acquisition programs.''.

              Subtitle B--Procurement Policy Improvements

SEC. 811. PERFORMANCE GOALS FOR CONTRACTING FOR SERVICES.

    (a) Individual Purchases of Services.--Subsection (a) of section 
802 of the National Defense Authorization Act for Fiscal Year 2002 
(Public Law 107-107; 10 U.S.C. 2330 note) is amended by adding at the 
end the following new paragraphs:
    ``(3) To support the attainment of the goals established in 
paragraph (2), the Department of Defense shall have the following 
goals:
            ``(A) To increase, as a percentage of all of the individual 
        purchases of services made by or for the Department of Defense 
        under multiple award contracts for a fiscal year (calculated on 
        the basis of dollar value), the volume of the individual 
        purchases of services that are made on a competitive basis and 
        involve the receipt of two or more offers from qualified 
        contractors to a percentage as follows:
                    ``(i) For fiscal year 2003, a percentage not less 
                than 50 percent.
                    ``(ii) For fiscal year 2004, a percentage not less 
                than 60 percent.
                    ``(iii) For fiscal year 2011, a percentage not less 
                than 80 percent.
            ``(B) To increase, as a percentage of all of the individual 
        purchases of services made by or for the Department of Defense 
        under multiple award contracts for a fiscal year (calculated on 
        the basis of dollar value), the use of performance-based 
        purchasing specifying firm fixed prices for the specific tasks 
        to be performed to a percentage as follows:
                    ``(i) For fiscal year 2003, a percentage not less 
                than 30 percent.
                    ``(ii) For fiscal year 2004, a percentage not less 
                than 40 percent.
                    ``(iii) For fiscal year 2005, a percentage not less 
                than 50 percent.
                    ``(iv) For fiscal year 2011, a percentage not less 
                than 80 percent.''.
    (b) Extension and Revision of Reporting Requirement.--Subsection 
(b) of such section is amended--
            (1) by striking ``March 1, 2006'', and inserting ``March 1, 
        2011''; and
            (2) by adding at the end the following new paragraphs:
            ``(6) Regarding the individual purchases of services that 
        were made by or for the Department of Defense under multiple 
        award contracts in the fiscal year preceding the fiscal year in 
        which the report is required to be submitted, information 
        (determined using the data collection system established under 
        section 2330a of title 10, United States Code) as follows:
                    ``(A) The percentage (calculated on the basis of 
                dollar value) of such purchases that are purchases that 
                were made on a competitive basis and involved receipt 
                of two or more offers from qualified contractors.
                    ``(B) The percentage (calculated on the basis of 
                dollar value) of such purchases that are performance-
                based purchases specifying firm fixed prices for the 
                specific tasks to be performed.''.
    (c) Definitions.--Such section is further amended by adding at the 
end the following new subsection:
    ``(c) Definitions.--In this section:
            ``(1) The term `individual purchase' means a task order, 
        delivery order, or other purchase.
            ``(2) The term `multiple award contract' means--
                    ``(A) a contract that is entered into by the 
                Administrator of General Services under the multiple 
                award schedule program referred to in section 
                2302(2)(C) of title 10, United States Code;
                    ``(B) a multiple award task order contract that is 
                entered into under the authority of sections 2304a 
                through 2304d of title 10, United States Code, or 
                sections 303H through 303K of the Federal Property and 
                Administrative Services Act of 1949 (41 U.S.C. 253h 
                through 253k); and
                    ``(C) any other indefinite delivery, indefinite 
                quantity contract that is entered into by the head of a 
                Federal agency with two or more sources pursuant to the 
                same solicitation.''.

SEC. 812. GRANTS OF EXCEPTIONS TO COST OR PRICING DATA CERTIFICATION 
              REQUIREMENTS AND WAIVERS OF COST ACCOUNTING STANDARDS.

    (a) Guidance for Exceptions in Exceptional Circumstances.--(1) Not 
later than 60 days after the date of the enactment of this Act, the 
Secretary of Defense shall issue guidance on the circumstances under 
which it is appropriate to grant--
            (A) an exception pursuant to section 2306a(b)(1)(C) of 
        title 10, United States Code, relating to submittal of 
        certified contract cost and pricing data; or
            (B) a waiver pursuant to section 26(f)(5)(B) of the Office 
        of Federal Procurement Policy Act (41 U.S.C. 422(f)(5)(B)), 
        relating to the applicability of cost accounting standards to 
        contracts and subcontracts.
    (2) The guidance shall, at a minimum, include a limitation that a 
grant of an exception or waiver referred to in paragraph (1) is 
appropriate with respect to a contract or subcontract, or (in the case 
of submittal of certified cost and pricing data) a modification, only 
upon a determination that the property or services cannot be obtained 
under the contract, subcontract, or modification, as the case may be, 
without the grant of the exception or waiver.
    (b) Semiannual Report.--(1) The Secretary of Defense shall transmit 
to the congressional defense committees promptly after the end of each 
half of a fiscal year a report on the exceptions to cost or pricing 
data certification requirements and the waivers of applicability of 
cost accounting standards that, in cases described in paragraph (2), 
were granted during that half of the fiscal year.
    (2) The report for a half of a fiscal year shall include an 
explanation of--
            (A) each decision by the head of a procuring activity 
        within the Department of Defense to exercise the authority 
        under subparagraph (B) or (C) of subsection (b)(1) of section 
        2306a of title 10, United States Code, to grant an exception to 
        the requirements of such section in the case of a contract, 
        subcontract, or contract or subcontract modification that is 
        expected to have a price of $15,000,000 or more; and
            (B) each decision by the Secretary of Defense or the head 
        of an agency within the Department of Defense to exercise the 
        authority under subsection (f)(5)(B) of section 26 of the 
        Office of Federal Procurement Policy Act to waive the 
        applicability of the cost accounting standards under such 
        section in the case of a contract or subcontract that is 
        expected to have a value of $15,000,000 or more.
    (c) Advance Notification of Congress.--(1) The Secretary of Defense 
shall transmit to the congressional defense committees an advance 
notification of--
            (A) any decision by the head of a procuring activity within 
        the Department of Defense to exercise the authority under 
        subsection (b)(1)(C) of section 2306a of title 10, United 
        States Code, to grant an exception to the requirements of such 
        section in the case of a contract, subcontract, or contract or 
        subcontract modification that is expected to have a price of 
        $75,000,000 or more; or
            (B) any decision by the Secretary of Defense or the head of 
        an agency within the Department of Defense to exercise the 
        authority under subsection (f)(5)(B) of section 26 of the 
        Office of Federal Procurement Policy Act to waive the 
        applicability of the cost accounting standards under such 
        section to a contract or subcontract that is expected to have a 
        value of $75,000,000 or more.
    (2) The notification under paragraph (1) regarding a decision to 
grant an exception or waiver shall be transmitted not later than 10 
days before the exception or waiver is granted.
    (d) Contents of Reports and Notifications.--A report pursuant to 
subsection (b) and a notification pursuant to subsection (c) shall 
include, for each grant of an exception or waiver, the following 
matters:
            (1) A discussion of the justification for the grant of the 
        exception or waiver, including at a minimum--
                    (A) in the case of an exception granted pursuant to 
                section 2306a(b)(1)(B) of title 10, United States Code, 
                an explanation of the basis for the determination that 
                the products or services to be purchased are commercial 
                items; and
                    (B) in the case of an exception granted pursuant to 
                section 2306a(b)(1)(C) of such title, or a waiver 
                granted pursuant to section 26(f)(5)(B) of the Office 
                of Federal Procurement Policy Act, an explanation of 
                the basis for the determination that it would not have 
                been possible to obtain the products or services from 
                the offeror without the grant of the exception or 
                waiver.
            (2) A description of the specific steps taken or to be 
        taken within the Department of Defense to ensure that the price 
        of each contract, subcontract, or modification covered by the 
        report or notification, as the case may be, is fair and 
        reasonable.
    (e) Effective Date.--The requirements of this section shall apply 
to each exception or waiver that is granted under a provision of law 
referred to in subsection (a) on or after the date on which the 
guidance required by that subsection (a) is issued.

SEC. 813. EXTENSION OF REQUIREMENT FOR ANNUAL REPORT ON DEFENSE 
              COMMERCIAL PRICING MANAGEMENT IMPROVEMENT.

    Section 803(c)(4) of the Strom Thurmond National Defense 
Authorization Act for Fiscal Year 1999 (Public Law 105-261; 112 Stat. 
2082; 10 U.S.C. 2306a note) is amended by striking ``2000, 2001, and 
2002,'' and inserting ``2000 through 2006,''.

SEC. 814. INTERNAL CONTROLS ON THE USE OF PURCHASE CARDS.

    (a) Requirement for Enhanced Internal Controls.--Not later than 120 
days after the date of the enactment of this Act, the Secretary of 
Defense shall take action to ensure that appropriate internal controls 
for the use of purchase cards issued by the Federal Government to 
Department of Defense personnel are in place throughout the Department 
of Defense. At a minimum, the internal controls shall include the 
following:
            (1) A requirement that the receipt and acceptance, and the 
        documentation of the receipt and acceptance, of the property or 
        services purchased on a purchase card be verified by a 
        Department of Defense official who is independent of the 
        purchaser.
            (2) A requirement that the monthly purchase card statements 
        of purchases on a purchase card be reviewed and certified for 
        accuracy by an official of the Department of Defense who is 
        independent of the purchaser.
            (3) Specific policies limiting the number of purchase cards 
        issued, with the objective of significantly reducing the number 
        of cardholders.
            (4) Specific policies on credit limits authorized for 
        cardholders, with the objective of minimizing financial risk to 
        the Federal Government.
            (5) Specific criteria for identifying employees eligible to 
        be issued purchase cards, with the objective of ensuring the 
        integrity of cardholders.
            (6) Accounting procedures that ensure that purchase card 
        transactions are properly recorded in Department of Defense 
        accounting records.
            (7) Requirements for regular internal review of purchase 
        card statements to identify--
                    (A) potentially fraudulent, improper, and abusive 
                purchases;
                    (B) any patterns of improper cardholder 
                transactions, such as purchases of prohibited items; 
                and
                    (C) categories of purchases that should be made 
                through other mechanisms to better aggregate purchases 
                and negotiate lower prices.
    (b) Training.--The Secretary of Defense shall ensure that all 
Department of Defense purchase cardholders are aware of the enhanced 
internal controls instituted pursuant to subsection (a).
    (c) Comptroller General Review.--Not later than March 1, 2003, the 
Comptroller General shall--
            (1) review the actions that have been taken within the 
        Department of Defense to comply with the requirements of this 
        section; and
            (2) submit a report on the actions reviewed to the 
        congressional defense committees.

SEC. 815. ASSESSMENT REGARDING FEES PAID FOR ACQUISITIONS UNDER OTHER 
              AGENCIES' CONTRACTS.

    (a) Requirement for Assessment and Report.--Not later than March 1, 
2003, the Secretary of Defense shall carry out an assessment to 
determine the total amount paid by the Department of Defense as fees 
for the acquisition of property and services by the Department of 
Defense under contracts between other departments and agencies of the 
Federal Government and the sources of the property and services in each 
of fiscal years 2000, 2001, and 2002, and submit a report on the 
results of the assessment to Congress.
    (b) Content of Report.--The report shall include the Secretary's 
views on what, if any, actions should be taken within the Department of 
Defense to reduce the total amount of the annual expenditures on fees 
described in subsection (a) and to use the amounts saved for other 
authorized purposes.

SEC. 816. PILOT PROGRAM FOR TRANSITION TO FOLLOW-ON CONTRACTS FOR 
              CERTAIN PROTOTYPE PROJECTS.

    Section 845 of the National Defense Authorization Act for Fiscal 
Year 1994 (10 U.S.C. 2371 note) is amended by--
            (1) redesignating subsections (e), (f), and (g) as 
        subsections (f), (g), and (h), respectively; and
            (2) inserting after subsection (d) the following new 
        subsection (e):
    ``(e) Pilot Program for Transition to Follow-on Contracts.--(1) The 
Secretary of Defense is authorized to carry out a pilot program for 
follow-on contracting for the production of items or processes that are 
developed by nontraditional defense contractors under prototype 
projects carried out under this section.
    ``(2) Under the pilot program--
            ``(A) a qualifying contract for the procurement of such an 
        item or process, or a qualifying subcontract under a contract 
        for the procurement of such an item or process, may be treated 
        as a contract or subcontract, respectively, for the procurement 
        of commercial items, as defined in section 4(12) of the Office 
        of Federal Procurement Policy Act (41 U.S.C. 403(12)); and
            ``(B) the item or process may be treated as an item or 
        process, respectively, that is developed in part with Federal 
        funds and in part at private expense for the purposes of 
        section 2320 of title 10, United States Code.
    ``(3) For the purposes of the pilot program, a qualifying contract 
or subcontract is a contract or subcontract, respectively, with a 
nontraditional defense contractor that--
            ``(A) does not exceed $20,000,000; and
            ``(B) is either--
                    ``(i) a firm, fixed-price contract or subcontract; 
                or
                    ``(ii) a fixed-price contract or subcontract with 
                economic price adjustment.
    ``(4) The authority to conduct a pilot program under this 
subsection shall terminate on September 30, 2005. The termination of 
the authority shall not affect the validity of contracts or 
subcontracts that are awarded or modified during the period of the 
pilot program, without regard to whether the contracts or subcontracts 
are performed during the period.''.

SEC. 817. WAIVER AUTHORITY FOR DOMESTIC SOURCE OR CONTENT REQUIREMENTS.

    (a) Authority.--Subchapter V of chapter 148 of title 10, United 
States Code, is amended by adding at the end the following new section:
``Sec. 2539c. Waiver of domestic source or content requirements
    ``(a) Authority.--Except as provided in subsection (f), the 
Secretary of Defense may waive the application of any domestic source 
requirement or domestic content requirement referred to in subsection 
(b) and thereby authorize the procurement of items that are grown, 
reprocessed, reused, produced, or manufactured--
            ``(1) in a foreign country that has a reciprocal defense 
        procurement memorandum of understanding or agreement with the 
        United States;
            ``(2) in a foreign country that has a reciprocal defense 
        procurement memorandum of understanding or agreement with the 
        United States substantially from components and materials 
        grown, reprocessed, reused, produced, or manufactured in the 
        United States or any foreign country that has a reciprocal 
        defense procurement memorandum of understanding or agreement 
        with the United States; or
            ``(3) in the United States substantially from components 
        and materials grown, reprocessed, reused, produced, or 
        manufactured in the United States or any foreign country that 
        has a reciprocal defense procurement memorandum of 
        understanding or agreement with the United States.
    ``(b) Covered Requirements.--For purposes of this section:
            ``(1) A domestic source requirement is any requirement 
        under law that the Department of Defense satisfy its 
        requirements for an item by procuring an item that is grown, 
        reprocessed, reused, produced, or manufactured in the United 
        States or by a manufacturer that is a part of the national 
        technology and industrial base (as defined in section 2500(1) 
        of this title).
            ``(2) A domestic content requirement is any requirement 
        under law that the Department of Defense satisfy its 
        requirements for an item by procuring an item produced or 
        manufactured partly or wholly from components and materials 
        grown, reprocessed, reused, produced, or manufactured in the 
        United States.
    ``(c) Applicability.--The authority of the Secretary to waive the 
application of a domestic source or content requirements under 
subsection (a) applies to the procurement of items for which the 
Secretary of Defense determines that--
            ``(1) application of the requirement would impede the 
        reciprocal procurement of defense items under a memorandum of 
        understanding providing for reciprocal procurement of defense 
        items between a foreign country and the United States in 
        accordance with section 2531 of this title; and
            ``(2) such 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.
    ``(d) Limitation on Delegation.--The authority of the Secretary to 
waive the application of domestic source or content requirements under 
subsection (a) may not be delegated to any officer or employee other 
than the Under Secretary of Defense for Acquisition, Technology and 
Logistics.
    ``(e) Consultations.--The Secretary may grant a waiver of the 
application of a domestic source or content requirement under 
subsection (a) only after consultation with the United States Trade 
Representative, the Secretary of Commerce, and the Secretary of State.
    ``(f) Laws Not Waivable.--The Secretary of Defense may not exercise 
the authority under subsection (a) to waive any domestic source or 
content requirement contained in any of the following laws:
            ``(1) The Small Business Act (15 U.S.C. 631 et seq.).
            ``(2) The Javits-Wagner-O'Day Act (41 U.S.C. et seq.).
            ``(3) Sections 7309 and 7310 of this title.
            ``(4) Section 2533a of this title.
    ``(g) Relationship to Other Waiver Authority.--The authority under 
subsection (a) to waive a domestic source requirement or domestic 
content requirement is in addition to any other authority to waive such 
requirement.
    ``(h) Construction With Respect to Later Enacted Laws.--This 
section may not be construed as being inapplicable to a domestic source 
requirement or domestic content requirement that is set forth in a law 
enacted after the enactment of this section solely on the basis of the 
later enactment.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such subchapter is amended by inserting after the item relating to 
section 2539b the following new item:

``2539c. Waiver of domestic source or content requirements.''.

                       Subtitle C--Other Matters

SEC. 821. EXTENSION OF THE APPLICABILITY OF CERTAIN PERSONNEL 
              DEMONSTRATION PROJECT EXCEPTIONS TO AN ACQUISITION 
              WORKFORCE DEMONSTRATION PROJECT.

    Section 4308(b)(3)(B) of the National Defense Authorization Act for 
Fiscal Year 1996 (Public Law 104-106; 10 U.S.C. 1701 note) is amended 
to read as follows:
                    ``(B) commences before November 18, 2007.''.

SEC. 822. MORATORIUM ON REDUCTION OF THE DEFENSE ACQUISITION AND 
              SUPPORT WORKFORCE.

    (a) Prohibition.--Notwithstanding any other provision of law, the 
defense acquisition and support workforce may not be reduced, during 
fiscal years 2003, 2004, and 2005, below the level of that workforce as 
of September 30, 2002, determined on the basis of full-time equivalent 
positions.
    (b) Waiver Authority.--The Secretary of Defense may waive the 
prohibition in subsection (a) and reduce the level of the defense 
acquisition and support workforce upon submitting to Congress the 
Secretary's certification that the defense acquisition and support 
workforce, at the level to which reduced, will be able efficiently and 
effectively to perform the workloads that are required of that 
workforce consistent with the cost-effective management of the defense 
acquisition system to obtain best value equipment and with ensuring 
military readiness.
    (c) Defense Acquisition and Support Workforce Defined.--In this 
section, the term ``defense acquisition and support workforce'' means 
Armed Forces and civilian personnel who are assigned to, or are 
employed in, an organization of the Department of Defense that is--
            (1) an acquisition organization specified in Department of 
        Defense Instruction 5000.58, dated January 14, 1992; or
            (2) an organization not so specified that has acquisition 
        as its predominant mission, as determined by the Secretary of 
        Defense.

SEC. 823. EXTENSION OF CONTRACT GOAL FOR SMALL DISADVANTAGED BUSINESSES 
              AND CERTAIN INSTITUTIONS OF HIGHER EDUCATION.

    Section 2323(k) of title 10, United States Code, is amended by 
striking ``2003'' both places it appears and inserting ``2006''.

SEC. 824. MENTOR-PROTEGE PROGRAM ELIGIBILITY FOR HUBZONE SMALL BUSINESS 
              CONCERNS AND SMALL BUSINESS CONCERNS OWNED AND CONTROLLED 
              BY SERVICE-DISABLED VETERANS.

    Section 831(m)(2) of the National Defense Authorization Act for 
Fiscal Year 1991 (10 U.S.C. 2302 note), is amended--
            (1) by striking ``or'' at the end of subparagraph (D);
            (2) by striking the period at the end of subparagraph (E) 
        and inserting a semicolon; and
            (3) by adding at the end the following new subparagraphs:
                    ``(F) a qualified HUBZone small business concern, 
                within the meaning of section 3(p)(5) of the Small 
                Business Act (15 U.S.C. 632(p)(5)); or
                    ``(G) a small business concern owned and controlled 
                by service-disabled veterans, as defined in section 
                3(q)(2) of the Small Business Act (15 U.S.C. 
                632(q)(2)).''.

SEC. 825. REPEAL OF REQUIREMENTS FOR CERTAIN REVIEWS BY THE COMPTROLLER 
              GENERAL.

    The following provisions of the National Defense Authorization Act 
for Fiscal Year 1996 (Public Law 104-106) are repealed:
            (1) Section 912(d) (110 Stat. 410; 10 U.S.C. 2216 note), 
        relating to Comptroller General reviews of the administration 
        of the Defense Modernization Account.
            (2) Section 5312(e) (110 Stat. 695; 40 U.S.C. 1492), 
        relating to Comptroller General monitoring of a pilot program 
        for solutions-based contracting for acquisition of information 
        technology.
            (3) Section 5401(c)(3) (110 Stat. 697; 40 U.S.C. 1501), 
        relating to a Comptroller General review and report regarding a 
        pilot program to test streamlined procedures for the 
        procurement of information technology products and services 
        available for ordering through multiple award schedules.

SEC. 826. MULTIYEAR PROCUREMENT AUTHORITY FOR PURCHASE OF DINITROGEN 
              TETROXIDE, HYDRAZINE, AND HYDRAZINE-RELATED PRODUCTS.

    (a) In General.--Chapter 141 of title 10, United States Code, is 
amended by inserting after section 2410n the following new section:
``Sec. 2410o. Multiyear procurement authority: purchase of dinitrogen 
              tetroxide, hydrazine, and hydrazine-related products
    ``(a) Ten-Year Contract Period.--The Secretary of Defense may enter 
into a contract for a period of up to 10 years for the purchase of 
dinitrogen tetroxide, hydrazine, and hydrazine-related products for the 
support of a United States national security program or a United States 
space program.
    ``(b) Extensions.--A contract entered into for more than one year 
under the authority of subsection (a) may be extended for a total of 
not more than 10 years pursuant to any option or options set forth in 
the contract.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 141 is amended by adding at the end the following item:

``2410o. Multiyear procurement authority: purchase of dinitrogen 
                            tetroxide, hydrazine, and hydrazine-related 
                            products.''.

SEC. 827. MULTIYEAR PROCUREMENT AUTHORITY FOR ENVIRONMENTAL SERVICES 
              FOR MILITARY INSTALLATIONS.

    (a) Authority.--Subsection (b) of section 2306c of title 10, United 
States Code, is amended by adding at the end the following new 
paragraph:
            ``(5) Environmental remediation services for--
                    ``(A) an active military installation;
                    ``(B) a military installation being closed or 
                realigned under a base closure law; or
                    ``(C) a site formerly used by the Department of 
                Defense.''.
    (b) Definitions.--Such section is further amended by adding at the 
end the following new subsection:
    ``(g) Additional Definitions.--In this section:
            ``(1) The term `base closure law' has the meaning given 
        such term in section 2667(h)(2) of this title.
            ``(2) The term `military installation' has the meaning 
        given such term in section 2801(c)(2) of this title.''.

      TITLE IX--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT

SEC. 901. TIME FOR SUBMITTAL OF REPORT ON QUADRENNIAL DEFENSE REVIEW.

    Section 118(d) of title 10, United States Code, is amended by 
striking ``not later than September 30 of the year in which the review 
is conducted'' in the second sentence and inserting ``in the year 
following the year in which the review is conducted, but not later than 
the date on which the President submits the budget for the next fiscal 
year to Congress under section 1105(a) of title 31''.

SEC. 902. INCREASED NUMBER OF DEPUTY COMMANDANTS AUTHORIZED FOR THE 
              MARINE CORPS.

    Section 5045 of title 10, United States Code, is amended by 
striking ``five'' and inserting ``six''.

SEC. 903. BASE OPERATING SUPPORT FOR FISHER HOUSES.

    (a) Expansion of Requirement To Include Army and Air Force.--
Section 2493(f) of title 10, United States Code, is amended to read as 
follows:
    ``(f) Base Operating Support.--The Secretary of the military 
department concerned shall provide base operating support for Fisher 
Houses associated with health care facilities of that military 
department.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on October 1, 2002.

SEC. 904. PREVENTION AND MITIGATION OF CORROSION.

    (a) Establishment.--Not later than 120 days after the date of the 
enactment of this Act, the Secretary of Defense shall designate an 
officer or employee of the Department of Defense as the senior official 
responsible (after the Secretary of Defense and the Under Secretary of 
Defense for Acquisition, Technology, and Logistics) for the prevention 
and mitigation of corrosion of the military equipment and 
infrastructure of the Department. The designated official shall report 
directly to the Under Secretary of Defense for Acquisition, Technology, 
and Logistics.
    (b) Duties.--The official designated under subsection (a) shall 
direct and coordinate initiatives throughout the Department of Defense 
to prevent and mitigate corrosion of the military equipment and 
infrastructure of the Department, including efforts to facilitate the 
prevention and mitigation of corrosion through--
            (1) development and recommendation of policy guidance on 
        the prevention and mitigation of corrosion which the Secretary 
        of Defense shall issue;
            (2) review of the annual budget proposed for the prevention 
        and mitigation of corrosion by the Secretary of each military 
        department and submittal of recommendations regarding the 
        proposed budget to the Secretary of Defense;
            (3) direction and coordination of the efforts within the 
        Department of Defense to prevent or mitigate corrosion during--
                    (A) the design, acquisition, and maintenance of 
                military equipment; and
                    (B) the design, construction, and maintenance of 
                infrastructure; and
            (4) monitoring of acquisition practices--
                    (A) to ensure that the use of corrosion prevention 
                technologies and the application of corrosion 
                prevention treatments are fully considered during 
                research and development in the acquisition process; 
                and
                    (B) to ensure that, to the extent determined 
                appropriate in each acquisition program, such 
                technologies and treatments are incorporated into the 
                program, particularly during the engineering and design 
                phases of the acquisition process.
    (c) Interim Report.--When the President submits the budget for 
fiscal year 2004 to Congress pursuant to section 1105(a) of title 31, 
United States Code, the Secretary of Defense shall submit to Congress a 
report regarding the actions taken under this section. The report shall 
include the following matters:
            (1) The organizational structure for the personnel carrying 
        out the responsibilities of the official designated under 
        subsection (a) with respect to the prevention and mitigation of 
        corrosion.
            (2) An outline and milestones for developing a long-term 
        corrosion prevention and mitigation strategy.
    (d) Long-Term Strategy.--(1) Not later than one year after the date 
of the enactment of this Act, the Secretary of Defense shall submit to 
Congress a long-term strategy to reduce corrosion and the effects of 
corrosion on the military equipment and infrastructure of the 
Department of Defense.
    (2) The strategy shall provide for the following actions:
            (A) Expanding the emphasis on corrosion prevention and 
        mitigation to include coverage of infrastructure.
            (B) Applying uniformly throughout the Department of Defense 
        requirements and criteria for the testing and certification of 
        new technologies for the prevention of corrosion.
            (C) Implementing programs, including programs supporting 
        databases, to foster the collection and analysis of--
                    (i) data useful for determining the extent of the 
                effects of corrosion on the maintenance and readiness 
                of military equipment and infrastructure; and
                    (ii) data on the costs associated with the 
                prevention and mitigation of corrosion.
            (D) Implementing programs, including supporting databases, 
        to ensure that a focused and coordinated approach is taken 
        throughout the Department of Defense to collect, review, 
        validate, and distribute information on proven methods and 
        products that are relevant to the prevention of corrosion of 
military equipment and infrastructure.
            (E) Implementing a program to identify specific funding in 
        future budgets for the total life cycle costs of the prevention 
        and mitigation of corrosion.
            (F) Establishing a coordinated research and development 
        program for the prevention and mitigation of corrosion for new 
        and existing military equipment and infrastructure that 
        includes a plan to transition new corrosion prevention 
        technologies into operational systems.
    (3) The strategy shall also include, for the actions provided for 
pursuant to paragraph (2), the following:
            (A) Policy guidance.
            (B) Performance measures and milestones.
            (C) An assessment of the necessary program management 
        resources and necessary financial resources.
    (e) GAO Reviews.--The Comptroller General shall monitor the 
implementation of the long-term strategy required under subsection (d) 
and, not later than 18 months after the date of the enactment of this 
Act, submit to Congress an assessment of the extent to which the 
strategy has been implemented.
    (f) Definitions.--In this section:
            (1) The term ``corrosion'' means the deterioration of a 
        substance or its properties due to a reaction with its 
        environment.
            (2) The term ``military equipment'' includes all air, land, 
        and sea weapon systems, weapon platforms, vehicles, and 
        munitions of the Department of Defense, and the components of 
        such items.
            (3) The term ``infrastructure'' includes all buildings, 
        structures, airfields, port facilities, surface and 
        subterranean utility systems, heating and cooling systems, fuel 
        tanks, pavements, and bridges.
    (g) Termination.--This section shall cease to be effective on the 
date that is five years after the date of the enactment of this Act.

                      TITLE X--GENERAL PROVISIONS

                     Subtitle A--Financial Matters

SEC. 1001. TRANSFER AUTHORITY.

    (a) Authority To Transfer Authorizations.--(1) Upon determination 
by the Secretary of Defense that such action is necessary in the 
national interest, the Secretary may transfer amounts of authorizations 
made available to the Department of Defense in this division for fiscal 
year 2003 between any such authorizations for that fiscal year (or any 
subdivisions thereof). Amounts of authorizations so transferred shall 
be merged with and be available for the same purposes as the 
authorization to which transferred.
    (2) The total amount of authorizations that the Secretary may 
transfer under the authority of this section may not exceed 
$2,500,000,000.
    (b) Limitations.--The authority provided by this section to 
transfer authorizations--
            (1) may only be used to provide authority for items that 
        have a higher priority than the items from which authority is 
        transferred; and
            (2) may not be used to provide authority for an item that 
        has been denied authorization by Congress.
    (c) Effect on Authorization Amounts.--A transfer made from one 
account to another under the authority of this section shall be deemed 
to increase the amount authorized for the account to which the amount 
is transferred by an amount equal to the amount transferred.
    (d) Notice to Congress.--The Secretary shall promptly notify 
Congress of each transfer made under subsection (a).

SEC. 1002. REALLOCATION OF AUTHORIZATIONS OF APPROPRIATIONS FROM 
              BALLISTIC MISSILE DEFENSE TO SHIPBUILDING.

    (a) Amount.--Notwithstanding any other provision of this Act, the 
total amount authorized to be appropriated under section 201(4) is 
hereby reduced by $690,000,000, and the amount authorized to be 
appropriated under section 102(a)(3) is hereby increased by 
$690,000,000.
    (b) Source of Reduction.--The total amount of the reduction in the 
amount authorized to be appropriated under section 201(4) shall be 
derived from the amount provided under that section for ballistic 
missile defense for research, development, test, and evaluation.
    (c) Allocation of Increase.--Of the additional amount authorized to 
be appropriated under section 102(a)(3) pursuant to subsection (a)--
            (1) $415,000,000 shall be available for advance procurement 
        of a Virginia class submarine;
            (2) $125,000,000 shall be available for advance procurement 
        of a DDG-51 class destroyer; and
            (3) $150,000,000 shall be available for advance procurement 
        of an LPD-17 class amphibious transport dock.

SEC. 1003. AUTHORIZATION OF APPROPRIATIONS FOR CONTINUED OPERATIONS FOR 
              THE WAR ON TERRORISM.

    (a) Amount.--(1) In addition to the amounts authorized to be 
appropriated under divisions A and B, funds are hereby authorized to be 
appropriated for fiscal year 2003 (subject to subsection (b)) in the 
total amount of $10,000,000,000 for the conduct of operations in 
continuation of the war on terrorism in accordance with the 
Authorization for Use of Military Force (Public Law 107-40; 50 U.S.C. 
1541 note).
    (2) The amount authorized to be appropriated under paragraph (1) 
shall be available for increased operating costs, transportation costs, 
costs of humanitarian efforts, costs of special pays, costs of enhanced 
intelligence efforts, increased personnel costs for members of the 
reserve components ordered to active duty under a provision of law 
referred to in section 101(a)(13)(B) of title 10, United States Code, 
and other costs related to operations referred to in paragraph (1).
    (b) Authorization Contingent on Budget Request.--The authorization 
of appropriations in subsection (a) shall be effective only to the 
extent of the amount provided in a budget request for the appropriation 
of funds for purposes set forth in subsection (a) that is  submitted by 
the President to Congress after the date of the enactment of this Act 
and--
            (1) includes a designation of the requested amount as being 
        essential to respond to or protect against acts or threatened 
        acts of terrorism; and
            (2) specifies a proposed allocation and plan for the use of 
        the appropriation for purposes set forth in subsection (a).

SEC. 1004. AUTHORIZATION OF EMERGENCY SUPPLEMENTAL APPROPRIATIONS FOR 
              FISCAL YEAR 2002.

    Amounts authorized to be appropriated to the Department of Defense 
for fiscal year 2002 in the National Defense Authorization Act for 
Fiscal Year 2002 (Public Law 107-107) are hereby adjusted, with respect 
to any such authorized amount, by the amount by which appropriations 
pursuant to such authorization were increased (by a supplemental 
appropriation) or decreased (by a rescission), or both, in any law 
making supplemental appropriations for fiscal year 2002 that is enacted 
during the 107th Congress, second session.

SEC. 1005. UNITED STATES CONTRIBUTION TO NATO COMMON-FUNDED BUDGETS IN 
              FISCAL YEAR 2003.

    (a) Fiscal Year 2003 Limitation.--The total amount contributed by 
the Secretary of Defense in fiscal year 2003 for the common-funded 
budgets of NATO may be any amount up to, but not in excess of, the 
amount specified in subsection (b) (rather than the maximum amount that 
would otherwise be applicable to those contributions under the fiscal 
year 1998 baseline limitation).
    (b) Total Amount.--The amount of the limitation applicable under 
subsection (a) is the sum of the following:
            (1) The amounts of unexpended balances, as of the end of 
        fiscal year 2002, of funds appropriated for fiscal years before 
        fiscal year 2003 for payments for those budgets.
            (2) The amount specified in subsection (c)(1).
            (3) The amount specified in subsection (c)(2).
            (4) The total amount of the contributions authorized to be 
        made under section 2501.
    (c) Authorized Amounts.--Amounts authorized to be appropriated by 
titles II and III of this Act are available for contributions for the 
common-funded budgets of NATO as follows:
            (1) Of the amount provided in section 201(1), $750,000 for 
        the Civil Budget.
            (2) Of the amount provided in section 301(a)(1), 
        $205,623,000 for the Military Budget.
    (d) Definitions.--For purposes of this section:
            (1) Common-funded budgets of nato.--The term ``common-
        funded budgets of NATO'' means the Military Budget, the 
        Security Investment Program, and the Civil Budget of the North 
        Atlantic Treaty Organization (and any successor or additional 
        account or program of NATO).
            (2) Fiscal year 1998 baseline limitation.--The term 
        ``fiscal year 1998 baseline limitation'' means the maximum 
        annual amount of Department of Defense contributions for 
        common-funded budgets of NATO that is set forth as the annual 
        limitation in section 3(2)(C)(ii) of the resolution of the 
        Senate giving the advice and consent of the Senate to the 
        ratification of the Protocols to the North Atlantic Treaty of 
        1949 on the Accession of Poland, Hungary, and the Czech 
        Republic (as defined in section 4(7) of that resolution), 
        approved by the Senate on April 30, 1998.

SEC. 1006. DEVELOPMENT AND IMPLEMENTATION OF FINANCIAL MANAGEMENT 
              ENTERPRISE ARCHITECTURE.

    (a) Requirement for Enterprise Architecture and Transition Plan.--
Not later than March 15, 2003, the Secretary of Defense shall develop a 
proposed financial management enterprise architecture for all 
budgetary, accounting, finance, and data feeder systems of the 
Department of Defense, together with a transition plan for implementing 
the proposed enterprise architecture.
    (b) Composition of Architecture.--The proposed financial management 
enterprise architecture developed under subsection (a) shall describe a 
system that, at a minimum--
            (1) includes data standards and system interface 
        requirements that are to apply uniformly throughout the 
        Department of Defense;
            (2) enables the Department of Defense--
                    (A) to comply with Federal accounting, financial 
                management, and reporting requirements;
                    (B) to routinely produce timely, accurate, and 
                useful financial information for management purposes;
                    (C) to integrate budget, accounting, and program 
                information and systems; and
                    (D) to provide for the systematic measurement of 
                performance, including the ability to produce timely, 
                relevant, and reliable cost information.
    (c) Composition of Transition Plan.--The transition plan developed 
under subsection (a) shall contain  specific time-phased milestones for 
modifying or eliminating existing systems and for acquiring new systems 
necessary to implement the proposed enterprise architecture.
    (d) Expenditures for Implementation.--The Secretary of Defense may 
not obligate more than $1,000,000 for a defense financial system 
improvement on or after the enterprise architecture approval date 
unless the Financial Management Modernization Executive Committee 
determines that the defense financial system improvement is consistent 
with the proposed enterprise architecture and transition plan.
    (e) Expenditures Pending Architecture Approval.--The Secretary of 
Defense may not obligate more than $1,000,000 for a defense financial 
system improvement during the enterprise architecture pre-approval 
period unless the Financial Management Modernization Executive 
Committee determines that the defense financial system improvement is 
necessary--
            (1) to achieve a critical national security capability or 
        address a critical requirement in an area such as safety or 
        security; or
            (2) to prevent a significant adverse effect (in terms of a 
        technical matter, cost, or schedule) on a project that is 
        needed to achieve an essential capability, taking into 
        consideration in the determination the alternative solutions 
        for preventing the adverse effect.
    (f) Comptroller General Review.--Not later than March 1 of each of 
2003, 2004, and 2005, the Comptroller General shall submit to the 
congressional defense committees a report on defense financial 
management system improvements that have been undertaken during the 
previous year. The report shall include the Comptroller General's 
assessment of the extent to which the improvements comply with the 
requirements of this section.
    (g) Definitions.--In this section:
            (1) The term ``defense financial system improvement''--
                    (A) means the acquisition of a new budgetary, 
                accounting, finance, or data feeder system for the 
                Department of Defense, or a modification of an existing 
                budgetary, accounting, finance, or data feeder system 
                of the Department of Defense; and
                    (B) does not include routine maintenance and 
                operation of any such system.
            (2) The term ``enterprise architecture approval date'' 
        means the date on which the Secretary of Defense approves a 
        proposed financial management enterprise architecture and a 
        transition plan that satisfy the requirements of this section.
            (3) The term ``enterprise architecture pre-approval 
        period'' means the period beginning on the date of the 
        enactment of this Act and ending on the day before the 
        enterprise architecture approval date.
            (4) The term ``feeder system'' means a data feeder system 
        within the meaning of section 2222(c)(2) of title 10, United 
        States Code.
            (5) The term ``Financial Management Modernization Executive 
        Committee'' means the Financial Management Modernization 
        Executive Committee established pursuant to section 185 of 
        title 10, United States Code.

SEC. 1007. DEPARTMENTAL ACCOUNTABLE OFFICIALS IN THE DEPARTMENT OF 
              DEFENSE.

    (a) Designation and Accountability.--Chapter 165 of title 10, 
United States Code, is amended by inserting after section 2773 the 
following new section:
``Sec. 2773a. Departmental accountable officials
    ``(a) Designation.--The Secretary of Defense may designate, in 
writing, as a departmental accountable official any employee of the 
Department of Defense or any member of the armed forces who--
            ``(1) has a duty to provide a certifying official of the 
        Department of Defense with information, data, or services 
        directly relied upon by the certifying official in the 
        certification of vouchers for payment; and
            ``(2) is not otherwise accountable under subtitle III of 
        title 31 or any other provision of law for payments made on the 
        basis of the vouchers.
    ``(b) Pecuniary Liability.--(1) The Secretary of Defense may, in a 
designation of a departmental accountable official under subsection 
(a), subject that official to pecuniary liability, in the same manner 
and to the same extent as an official accountable under subtitle III of 
title 31, for an illegal, improper, or incorrect payment made pursuant 
to a voucher certified by a certifying official of the Department of 
Defense on the basis of information, data, or services that--
            ``(A) the departmental accountable official provides to the 
        certifying official in the performance of a duty described in 
        subsection (a)(1); and
            ``(B) the certifying official directly relies upon in 
        certifying the voucher.
    ``(2) Any pecuniary liability imposed on a departmental accountable 
official under this subsection for a loss to the United States 
resulting from an illegal, improper, or incorrect payment shall be 
joint and several with that of any other employee or employees of the 
United States or member or members of the uniformed services who are 
pecuniarily liable for the loss.
    ``(c) Relief From Pecuniary Liability.--The Secretary of Defense 
shall relieve a departmental accountable official from pecuniary 
liability imposed under subsection (b) in the case of a payment if the 
Secretary determines that the payment was not a result of fault or 
negligence on the part of the departmental accountable official.
    ``(d) Certifying Official Defined.--In this section, the term 
`certifying official' means an employee who has the responsibilities 
specified in section 3528(a) of title 31.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by inserting after the item relating to section 
2773 the following new item:

        ``2773a. Departmental accountable officials.''.

SEC. 1008. DEPARTMENT-WIDE PROCEDURES FOR ESTABLISHING AND LIQUIDATING 
              PERSONAL PECUNIARY LIABILITY.

    (a) Report of Survey Procedures.--(1) Chapter 165 of title 10, 
United States Code, is amended by inserting after section 2786 the 
following new section:
``Sec. 2787. Reports of survey
    ``(a) Regulations.--Under regulations prescribed pursuant to 
subsection (c), any officer of the armed forces or any civilian 
employee of the Department of Defense designated in accordance with the 
regulations may act upon reports of survey and vouchers pertaining to 
the loss, spoilage, unserviceability, unsuitability, or destruction of, 
or damage to, property of the United States under the control of the 
Department of Defense.
    ``(b) Finality of Action.--(1) Action taken under subsection (a) is 
final except as provided in paragraph (2).
    ``(2) An action holding a person pecuniarily liable for loss, 
spoilage, destruction, or damage is not final until approved by a 
person designated to do so by the Secretary of a military department, 
commander of a combatant command, or Director of a Defense Agency, as 
the case may be, who has jurisdiction of the person held pecuniarily 
liable. The person designated to provide final approval shall be an 
officer of an armed force, or a civilian employee, under the 
jurisdiction of the official making the designation.
    ``(c) Regulations.--The Secretary of Defense shall prescribe 
regulations to carry out this section.''.
    (2) The table of sections at the beginning of chapter 165 of such 
title is amended by inserting after the item relating to section 2786 
the following new item:

``2787. Reports of survey.''.
    (b) Damage or Repair of Arms and Equipment.--Section 1007(e) of 
title 37, United States Code, is amended by striking ``Army or the Air 
Force'' and inserting ``Army, Navy, Air Force, or Marine Corps''.
    (c) Repeal of Superseded Provisions.--(1) Sections 4835 and 9835 of 
title 10, United States Code, are repealed.
    (2) The tables of sections at the beginning of chapters 453 and 953 
of such title are amended by striking the items relating to sections 
4835 and 9835, respectively.

SEC. 1009. TRAVEL CARD PROGRAM INTEGRITY.

    (a) Authority.--Section 2784 of title 10, United States Code, is 
amended by adding at the end the following new subsections:
    ``(d) Disbursement of Allowances Directly to Creditors.--(1) The 
Secretary of Defense may require that any part of the travel or 
transportation allowances of an employee of the Department of Defense 
or a member of the armed forces be disbursed directly to the issuer of 
a Defense travel card if the amount is disbursed to the issuer in 
payment of amounts of expenses of official travel that are charged by 
the employee or member on the Defense travel card.
    ``(2) For the purposes of this subsection, the travel and 
transportation allowances referred to in paragraph (1) are amounts to 
which an employee of the Department of Defense is entitled under 
section 5702 of title 5 and or a member of the armed forces is entitled 
section 404 of title 37.
    ``(e) Offsets for Delinquent Travel Card Charges.--(1) The 
Secretary of Defense may require that there be deducted and withheld 
from any pay payable to an employee of the Department of Defense or a 
member of the armed forces any amount that is owed by the employee or 
member to a creditor by reason of one or more charges of expenses of 
official travel of the employee or member on a Defense travel card 
issued by the creditor if the employee or member--
            ``(A) is delinquent in the payment of such amount under the 
        terms of the contract under which the card is issued; and
            ``(B) does not dispute the amount of the delinquency.
    ``(2) The amount deducted and withheld from pay under paragraph (1) 
with respect to a debt owed a creditor as described in that paragraph 
shall be disbursed to the creditor to reduce the amount of the debt.
    ``(3) The amount of pay deducted and withheld from the pay owed to 
an employee or member with respect to a pay period under paragraph (1) 
may not exceed 15 percent of the disposable pay of the employee or 
member for that pay period, except that a higher amount may be deducted 
and withheld with the written consent of the employee or member.
    ``(4) The Secretary of Defense shall prescribe procedures for 
deducting and withholding amounts from pay under this subsection. The 
procedures shall be substantially equivalent to the procedures under 
section 3716 of title 31.
    ``(f) Under Secretary of Defense (Comptroller).--The Secretary of 
Defense shall act through the Under Secretary of Defense (Comptroller) 
in carrying out this section.
    ``(g) Definitions.--In this section:
            ``(1) The term `Defense travel card' means a charge or 
        credit card that--
                    ``(A) is issued to an employee of the Department of 
                Defense or a member of the armed forces under a 
                contract entered into by the Department of Defense and 
                the issuer of the card; and
                    ``(B) is to be used for charging expenses incurred 
                by the employee or member in connection with official 
                travel.
            ``(2) The term `disposable pay', with respect to a pay 
        period, means the amount equal to the excess of the amount of 
        basic pay payable for the pay period over the total of the 
        amounts deducted and withheld from such pay.''.
    (b) Conforming Amendment.--Subsection (a) of such section is 
amended by striking ``, acting through the Under Secretary of Defense 
(Comptroller),''.

                Subtitle B--Naval Vessels and Shipyards

SEC. 1021. NUMBER OF NAVY SURFACE COMBATANTS IN ACTIVE AND RESERVE 
              SERVICE.

    (a) Contingent Requirement for Report.--If, on the date of the 
enactment of this Act, the total number of Navy ships comprising the 
force of surface combatants is less than 116, the Secretary of the Navy 
shall submit a report on the size of that force to the Committees on 
Armed Services of the Senate and the House of Representatives. The 
report shall be submitted not later than 90 days after such date and 
shall include a risk assessment for such force that is based on the 
same assumptions as those that were applied in the QDR 2001 current 
force risk assessment.
    (b) Limitation on Reduction.--The force of surface combatants may 
not be reduced at any time after the date of the enactment of this Act 
from a number of ships (whether above, equal to, or below 116) to a 
number of ships below 116 before the date that is 90 days after the 
date on which the Secretary of the Navy submits to the committees 
referred to in subsection (a) a written notification of the reduction. 
The notification shall include the following information:
            (1) The schedule for the reduction.
            (2) The number of ships that are to comprise the reduced 
        force of surface combatants.
            (3) A risk assessment for the reduced force that is based 
        on the same assumptions as those that were applied in the QDR 
        2001 current force risk assessment.
    (c) Preservation of Surge Capability.--Whenever the total number of 
Navy ships comprising the force of surface combatants is less than 116, 
the Secretary of the Navy shall maintain on the Naval Vessel Register a 
sufficient number of surface combatant ships to enable the Navy to 
regain a total force of 116 surface combatant ships in active and 
reserve service in the Navy within 120 days after the President decides 
to increase the force of surface combatants.
    (d) Definitions.--In this section:
            (1) The term ``force of surface combatants'' means the 
        surface combatant ships in active and reserve service in the 
        Navy.
            (2) The term ``QDR 2001 current force risk assessment'' 
        means the risk assessment associated with a force of 116 
        surface combatant ships in active and reserve service in the 
        Navy that is set forth in the report on the quadrennial defense 
        review submitted to Congress on September 30, 2001, under 
        section 118 of title 10, United States Code.

SEC. 1022. PLAN FOR FIELDING THE 155-MILLIMETER GUN ON A SURFACE 
              COMBATANT.

    (a) Requirement for Plan.--The Secretary of the Navy shall submit 
to Congress a plan for fielding the 155-millimeter gun on one surface 
combatant ship in active service in the Navy. The Secretary shall 
submit the plan at the same time that the President submits the budget 
for fiscal year 2004 to Congress under section 1105(a) of title 31, 
United States Code.
    (b) Fielding on Expedited Schedule.--The plan shall provide for 
fielding the 155-millimeter gun on an expedited schedule that is 
consistent with the achievement of safety of operation and fire support 
capabilities meeting the fire support requirements of the Marine Corps, 
but not later than October 1, 2006.

SEC. 1023. REPORT ON INITIATIVES TO INCREASE OPERATIONAL DAYS OF NAVY 
              SHIPS.

    (a) Requirement for Report on Initiatives.--(1) The Under Secretary 
of Defense for Acquisition, Technology, and Logistics shall submit to 
the Committees on Armed Services of the Senate and the House of 
Representatives a report on Department of Defense initiatives to 
increase the number of operational days of Navy ships as described in 
subsection (b).
    (2) The report shall cover the ongoing Department of Defense 
initiatives as well as potential initiatives that are under 
consideration within the Department of Defense.
    (b) Initiatives Within Limits of Existing Fleet and Deployment 
Policy.--The Under Secretary shall, in the report, assess the 
feasibility and identify the projected effects of conducting 
initiatives that have the potential to increase the number of 
operational days of Navy ships available to the commanders-in-chief of 
the regional unified combatant commands without increasing the number 
of Navy ships and without increasing the routine lengths of deployments 
of Navy ships above six months.
    (c) Required Focus Areas.--The report shall, at a minimum, address 
the following four focus areas:
            (1) Assignment of additional ships, including submarines, 
        to home ports closer to the areas of operation for the ships 
        (known as ``forward homeporting'').
            (2) Assignment of ships to remain in a forward area of 
        operations, together with rotation of crews for each ship so 
        assigned.
            (3) Retention of ships for use until the end of the full 
        service life, together with investment of the funds necessary 
        to support retention to that extent.
            (4) Prepositioning of additional ships with, under normal 
        circumstances, small crews in a forward area of operations.
    (d) Time for Submittal.--The report shall be submitted at the same 
time that the President submits the budget for fiscal year 2004 to 
Congress under section 1105(a) of title 31, United States Code.

                   Subtitle C--Reporting Requirements

SEC. 1031. REPEAL AND MODIFICATION OF VARIOUS REPORTING REQUIREMENTS 
              APPLICABLE WITH RESPECT TO THE DEPARTMENT OF DEFENSE.

    (a) Provisions of Title 10.--Title 10, United States Code, is 
amended as follows:
            (1)(A) Section 183 is repealed.
            (B) The table of sections at the beginning of chapter 7 is 
        amended by striking the item relating to section 183.
            (2)(A) Sections 226 and 230 are repealed.
            (B) The table of sections at the beginning of chapter 9 is 
        amended by striking the items relating to sections 226 and 230.
            (3) Effective two years after the date of the enactment of 
        this Act--
                    (A) section 483 is repealed; and
                    (B) the table of sections at the beginning of 
                chapter 23 is amended by striking the item relating to 
                section 483.
            (4) Section 526 is amended by striking subsection (c).
            (5) Section 721(d) is amended--
                    (A) by striking paragraph (2); and
                    (B) by striking ``(1)'' before ``If an officer''.
            (6) Section 1095(g) is amended--
                    (A) by striking paragraph (2); and
                    (B) by striking ``(1)'' after ``(g)''.
            (7) Section 1798 is amended by striking subsection (d).
            (8) Section 1799 is amended by striking subsection (d).
            (9) Section 2220 is amended--
                    (A) by striking subsections (b) and (c);
                    (B) by striking ``(1)'' after ``Establishment of 
                Goals.--''; and
                    (C) by striking ``(2) The'' and inserting ``(b) 
                Evaluation of Cost Goals.--The''.
            (10) Section 2350a(g) is amended by striking paragraph (4).
            (11) Section 2350f is amended by striking subsection (c).
            (12) Section 2350k is amended by striking subsection (d).
            (13) Section 2367(d) is amended by striking ``Effort.--(1) 
        In the'' and all that follows through ``(2) After the close 
        of'' and inserting ``Effort.--After the close of''.
            (14) Section 2391 is amended by striking subsection (c).
            (15) Section 2486(b)(12) is amended by striking ``, except 
        that'' and all that follows and inserting the following: ``, 
        except that the Secretary shall notify Congress of any addition 
        of, or change in, a merchandise category under this 
        paragraph.''.
            (16) Section 2492 is amended by striking subsection (c) and 
        inserting the following:
    ``(c) Notification of Conditions Necessitating Restrictions.--The 
Secretary of Defense shall notify Congress of any change proposed or 
made to any of the host nation laws or any of the treaty obligations of 
the United States, and any changed conditions within host nations, if 
the change would necessitate the use of quantity or other restrictions 
on purchases in commissary and exchange stores located outside the 
United States.''.
            (17)(A) Section 2504 is repealed.
            (B) The table of sections at the beginning of subchapter II 
        of chapter 148 is amended by striking the item relating to 
        section 2504.
            (18) Section 2506--
                    (A) is amended by striking subsection (b); and
                    (B) by striking ``(a) Departmental Guidance.--''.
            (19) Section 2537(a) is amended by striking ``$100,000'' 
        and inserting ``$10,000,000''.
            (20) Section 2611 is amended by striking subsection (e).
            (21) Section 2667(d) is amended by striking paragraph (3).
            (22) Section 2813 is amended by striking subsection (c).
            (23) Section 2827 is amended--
                    (A) by striking subsection (b); and
                    (B) by striking ``(a) Subject to subsection (b), 
                the Secretary'' and inserting ``The Secretary''.
            (24) Section 2867 is amended by striking subsection (c).
            (25) Section 4416 is amended by striking subsection (f).
            (26) Section 5721(f) is amended--
                    (A) by striking paragraph (2); and
                    (B) by striking ``(1)'' after the subsection 
                heading.
    (b) National Defense Authorization Act for Fiscal Year 1995.--
Section 553(b) of the National Defense Authorization Act for Fiscal 
Year 1995 (Public Law 103-337; 108 Stat. 2772; 10 U.S.C. 4331 note) is 
amended by striking the last sentence.
    (c) Ballistic Missile Defense Act of 1995.--Section 234 of the 
Ballistic Missile Defense Act of 1995 (subtitle C of title II of Public 
Law 104-106; 10 U.S.C. 2431 note) is amended by striking subsection 
(f).

SEC. 1032. ANNUAL REPORT ON WEAPONS TO DEFEAT HARDENED AND DEEPLY 
              BURIED TARGETS.

    (a) Annual Report.--Not later than April 1, 2003, and each year 
thereafter, the Secretary of Defense, Secretary of Energy, and Director 
of Central Intelligence shall jointly submit to the congressional 
defense committees a report on the research and development activities 
undertaken by their respective agencies during the preceding fiscal 
year to develop a weapon to defeat hardened and deeply buried targets.
    (b) Report Elements.--The report for a fiscal year under subsection 
(a) shall--
            (1) include a discussion of the integration and 
        interoperability of the various programs to develop a weapon 
        referred to in that subsection that were undertaken during such 
        fiscal year, including a discussion of the relevance of such 
        programs to applicable decisions of the Joint Requirements 
        Oversight Council; and
            (2) set forth separately a description of the research and 
        development activities, if any, to develop a weapon referred to 
        in that subsection that were undertaken during such fiscal year 
        by each military department, the Department of Energy, and the 
        Central Intelligence Agency.

SEC. 1033. REVISION OF DATE OF ANNUAL REPORT ON COUNTERPROLIFERATION 
              ACTIVITIES AND PROGRAMS.

    Section 1503(a) of the National Defense Authorization Act for 
Fiscal Year 1995 (22 U.S.C. 2751 note) is amended by striking 
``February 1 of each year'' and inserting ``May 1 each year''.

SEC. 1034. QUADRENNIAL QUALITY OF LIFE REVIEW.

    (a) Requirement for Review.--Chapter 23 of title 10, United States 
Code, is amended by adding at the end the following new section:
``Sec. 488. Quadrennial quality of life review
    ``(a) Review Required.--(1) The Secretary of Defense shall every 
four years, two years after the submission of the quadrennial defense 
review to Congress under section 118 of this title, conduct a 
comprehensive examination of the quality of life of the members of the 
armed  forces (to be known as the `quadrennial quality of life 
review'). The review shall include examination of the programs, 
projects, and activities of the Department of Defense, including the 
morale, welfare, and recreation activities.
    ``(2) The quadrennial review shall be designed to result in 
determinations, and to foster policies and actions, that reflect the 
priority given the quality of life of members of the armed forces as a 
primary concern of the Department of Defense leadership.
    ``(b) Conduct of Review.--Each quadrennial quality of life review 
shall be conducted so as--
            ``(1) to assess quality of life priorities and issues 
        consistent with the most recent National Security Strategy 
        prescribed by the President pursuant to section 108 of the 
        National Security Act of 1947 (50 U.S.C. 404a);
            ``(2) to identify actions that are needed in order to 
        provide members of the armed forces with the quality of life 
        reasonably necessary to encourage the successful execution of 
        the full range of missions that the members are called on to 
        perform under the national security strategy;
            ``(3) to provide a full accounting of the backlog of 
        installations in need of maintenance and repair, to determine 
        how the disrepair affects performance and quality of life of 
        members and their families, and to identify the budget plan 
        that would be required to provide the resources necessary to 
        remedy the backlog of maintenance and repair; and
            ``(4) to identify other actions that have the potential for 
        improving the quality of life of the members of the armed 
        forces.
    ``(c) Considerations.--Among the matters considered by the 
Secretary in conducting the quadrennial review, the Secretary shall 
include the following matters:
            ``(1) Infrastructure.
            ``(2) Military construction.
            ``(3) Physical conditions at military installations and 
        other Department of Defense facilities.
            ``(4) Budget plans.
            ``(5) Adequacy of medical care for members of the armed 
        forces and their dependents.
            ``(6) Adequacy of housing and the basic allowance for 
        housing and basic allowance for subsistence.
            ``(7) Housing-related utility costs.
            ``(8) Educational opportunities and costs.
            ``(9) Length of deployments.
            ``(10) Rates of pay, and pay differentials between the pay 
        of members and the pay of civilians.
            ``(11) Retention and recruiting efforts.
            ``(12) Workplace safety.
            ``(13) Support services for spouses and children.
            ``(14) Other elements of Department of Defense programs and 
        Federal Government policies and programs that affect the 
        quality of life of members.
    ``(d) Submission of QQLR to Congressional Committees.--The 
Secretary shall submit a report on each quadrennial quality of life 
review to the Committees on Armed Services of the Senate and the House 
of Representatives. The report shall be submitted not later than 
September 30 of the year in which the review is conducted. The report 
shall include the following:
            ``(1) The results of the review, including a comprehensive 
        discussion of how the quality of life of members of the armed 
        forces affects the national security strategy of the United 
        States.
            ``(2) The long-term quality of life problems of the armed 
        forces, together with proposed solutions.
            ``(3) The short-term quality of life problems of the armed 
        forces, together with proposed solutions.
            ``(4) The assumptions used in the review.
            ``(5) The effects of quality of life problems on the morale 
        of the members of the armed forces.
            ``(6) The quality of life problems that affect the morale 
        of members of the reserve components in particular, together 
        with solutions.
            ``(7) The effects of quality of life problems on military 
        preparedness and readiness.
            ``(8) The appropriate ratio of--
                    ``(A) the total amount expended by the Department 
                of Defense in a fiscal year for programs, projects, and 
                activities designed to improve the quality of life of 
                members of the armed forces, to
                    ``(B) the total amount expended by the Department 
                of Defense in the fiscal year.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by adding at the end the following new item:

``488. Quadrennial quality of life review.''.

                      Subtitle D--Homeland Defense

SEC. 1041. HOMELAND SECURITY ACTIVITIES OF THE NATIONAL GUARD.

    (a) Authority.--Chapter 1 of title 32, United States Code, is 
amended by adding at the end the following new section:
``Sec. 116. Homeland security activities
    ``(a) Use of Personnel Performing Full-Time National Guard Duty.--
The Governor of a State may, upon the request by the head of a Federal 
law enforcement agency and with the concurrence of the Secretary of 
Defense, order any personnel of the National Guard of the State to 
perform full-time National Guard duty under section 502(f) of this 
title for the purpose of carrying out homeland security activities, as 
described in subsection (b).
    ``(b) Purpose and Duration.--(1) The purpose for the use of 
personnel of the National Guard of a State under this section is to 
temporarily provide trained and disciplined personnel to a Federal law 
enforcement agency to assist that agency in carrying out homeland 
security activities until that agency is able to recruit and train a 
sufficient force of Federal employees to perform the homeland security 
activities.
    ``(2) The duration of the use of the National Guard of a State 
under this section shall be limited to a period of 179 days. The 
Governor of the State may, with the concurrence of the Secretary of 
Defense, extend the period one time for an additional 90 days to meet 
extraordinary circumstances.
    ``(c) Relationship to Required Training.-- A member of the National 
Guard serving on full-time National Guard duty under orders authorized 
under subsection (a) shall participate in the training required under  
section 502(a) of this title in addition to the duty performed for the 
purpose authorized under that subsection. The pay, allowances, and 
other benefits of the member while participating in the training shall 
be the same as those to which the member is entitled while performing 
duty for the purpose of carrying out homeland security activities. The 
member is not entitled to additional pay, allowances, or other benefits 
for participation in training required under section 502(a)(1) of this 
title.
    ``(d) Readiness.--To ensure that the use of units and personnel of 
the National Guard of a State for homeland security activities does not 
degrade the training and readiness of such units and personnel, the 
following requirements shall apply in determining the homeland security 
activities that units and personnel of the National Guard of a State 
may perform:
            ``(1) The performance of the activities may not adversely 
        affect the quality of that training or otherwise interfere with 
        the ability of a member or unit of the National Guard to 
        perform the military functions of the member or unit.
            ``(2) National Guard personnel will not degrade their 
        military skills as a result of performing the activities.
            ``(3) The performance of the activities will not result in 
        a significant increase in the cost of training.
            ``(4) In the case of homeland security performed by a unit 
        organized to serve as a unit, the activities will support valid 
        unit training requirements.
    ``(e) Payment of Costs.--(1) The Secretary of Defense shall provide 
funds to the Governor of a State to pay costs of the use of personnel 
of the National Guard of the State for the performance of homeland 
security activities under this section. Such funds shall be used for 
the following costs:
            ``(A) The pay, allowances, clothing, subsistence, 
        gratuities, travel, and related expenses (including all 
        associated training expenses, as determined by the Secretary), 
        as authorized by State law, of personnel of the National Guard 
        of that State used, while not in Federal service, for the 
        purpose of homeland security activities.
            ``(B) The operation and maintenance of the equipment and 
        facilities of the National Guard of that State used for the 
        purpose of homeland security activities.
    ``(2) The Secretary of Defense shall require the head of a law 
enforcement agency receiving support from the National Guard of a State 
in the performance of homeland security activities under this section 
to reimburse the Department of Defense for the payments made to the 
State for such support under paragraph (1).
    ``(f) Memorandum of Agreement.--The Secretary of Defense and the 
Governor of a State shall enter into a memorandum of agreement with the 
head of each Federal law enforcement agency to which the personnel of 
the National Guard of that State are to provide support in the 
performance of homeland security activities under this section. The 
memorandum of agreement shall--
            ``(1) specify how personnel of the National Guard are to be 
        used in homeland security activities;
            ``(2) include a certification by the Adjutant General of 
        the State that those activities are to be performed at a time 
        when the personnel are not in Federal service;
            ``(3) include a certification by the Adjutant General of 
        the State that--
                    ``(A) participation by National Guard personnel in 
                those activities is service in addition to training 
                required under section 502 of this title; and
                    ``(B) the requirements of subsection (d) of this 
                section will be satisfied;
            ``(4) include a certification by the Attorney General of 
        the State (or, in the case of a State with no position of 
        Attorney General, a civilian official of the State equivalent 
        to a State attorney general), that the use of the National 
        Guard of the State for the activities provided for under the 
        memorandum of agreement is authorized by, and is consistent 
        with, State law;
            ``(5) include a certification by the Governor of the State 
        or a civilian law enforcement official of the State designated 
        by the Governor that the activities provided for under the 
        memorandum of agreement serve a State law enforcement purpose; 
        and
            ``(6) include a certification by the head of the Federal 
        law enforcement agency that the agency will have a plan to 
        ensure that the agency's requirement for National Guard support 
        ends not later than 179 days after the commencement of the 
        support.
    ``(g) Exclusion From End-Strength Computation.--Notwithstanding any 
other provision of law, members of the National Guard on active duty or 
full-time National Guard duty for the purposes of administering (or 
during fiscal year 2003 otherwise implementing) this section shall not 
be counted toward the annual end strength authorized for reserves on 
active duty in support of the reserve components of the armed forces or 
toward the strengths authorized in sections 12011 and 12012 of title 
10.
    ``(h) Annual Report.--The Secretary of Defense shall submit to 
Congress an annual report regarding any assistance provided and 
activities carried out under this section during the preceding fiscal 
year. The report shall include the following:
            ``(1) The number of members of the National Guard excluded 
        under subsection (g) from the computation of end strengths.
            ``(2) A description of the homeland security activities 
        conducted with funds provided under this section.
            ``(3) An accounting of the amount of funds provided to each 
        State.
            ``(4) A description of the effect on military training and 
        readiness of using units and personnel of the National Guard to 
        perform homeland security activities under this section.
    ``(i) Statutory Construction.--Nothing in this section shall be 
construed as a limitation on the authority of any unit of the National 
Guard of a State, when such  unit is not in Federal service, to perform 
law enforcement functions authorized to be performed by the National 
Guard by the laws of the State concerned.
    ``(j) Definitions.--For purposes of this section:
            ``(1) The term `Governor of a State' means, in the case of 
        the District of Columbia, the Commanding General of the 
        National Guard of the District of Columbia.
            ``(2) The term `State' means each of the several States, 
        the District of Columbia, the Commonwealth of Puerto Rico, or a 
        territory or possession of the United States.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such section is amended by adding at the end the following new item:

``116. Homeland security activities.''.

SEC. 1042. CONDITIONS FOR USE OF FULL-TIME RESERVES TO PERFORM DUTIES 
              RELATING TO DEFENSE AGAINST WEAPONS OF MASS DESTRUCTION.

    Section 12310(c)(3) of title 10, United States Code, is amended by 
striking ``only--'' and all that follows through ``(B) while assigned'' 
and inserting ``only while assigned''.

SEC. 1043. WEAPON OF MASS DESTRUCTION DEFINED FOR PURPOSES OF THE 
              AUTHORITY FOR USE OF RESERVES TO PERFORM DUTIES RELATING 
              TO DEFENSE AGAINST WEAPONS OF MASS DESTRUCTION.

    (a) Weapon of Mass Destruction Redefined.--Section 12304(i)(2) of 
title 10, United States Code, is amended to read as follows:
            ``(2) The term `weapon of mass destruction' means--
                    ``(A) any weapon that is designed or, through its 
                use, is intended to cause death or serious bodily 
                injury through the release, dissemination, or impact of 
                toxic or poisonous chemicals or their precursors;
                    ``(B) any weapon that involves a disease organism;
                    ``(C) any weapon that is designed to release 
                radiation or radioactivity at a level dangerous to 
                human life; and
                    ``(D) any large conventional explosive that is 
                designed to produce catastrophic loss of life or 
                property.''.
    (b) Conforming Amendment.--Section 12310(c)(1) of such title is 
amended by striking ``section 1403 of the Defense Against Weapons of 
Mass Destruction Act of 1996 (50 U.S.C. 2302(1))'' and inserting 
``section 12304(i)(2) of this title''.

SEC. 1044. REPORT ON DEPARTMENT OF DEFENSE HOMELAND DEFENSE ACTIVITIES.

    (a) Report Required.--Not later than February 1, 2003, the 
Secretary of Defense shall submit to the congressional defense 
committees a report on what actions of the Department of Defense would 
be necessary to carry out the Secretary's expressed intent--
            (1) to place new emphasis on the unique operational demands 
        associated with the defense of the United States homeland; and
            (2) to restore the mission of defense of the United States 
        to the position of being the primary mission of the Department 
        of Defense.
    (b) Content of the Report.--The report shall contain, in accordance 
with the other provisions of this section, the following matters:
            (1) Homeland defense campaign plan.--A homeland defense 
        campaign plan.
            (2) Intelligence.--A discussion of the relationship 
        between--
                    (A) the intelligence capabilities of--
                            (i) the Department of Defense; and
                            (ii) other departments and agencies of the 
                        United States; and
                    (B) the performance of the homeland defense 
                mission.
            (3) Threat and vulnerability assessment.--A compliance-
        based national threat and vulnerability assessment.
            (4) Training and exercising.--A discussion of the 
        Department of Defense plans for training and exercising for the 
        performance of the homeland defense mission.
            (5) Bioterrorism initiative.--An evaluation of the need for 
        a Department of Defense bioterrorism initiative to improve the 
        ability of the department to counter bioterror threats and to 
        assist other agencies to improve the national ability to 
        counter bioterror threats.
            (6) Chemical biological incident response teams.--An 
        evaluation of the need for and feasibility of developing and 
        fielding Department of Defense regional chemical biological 
        incident response teams.
            (7) Other matters.--Any other matters that the Secretary of 
        Defense considers relevant regarding the efforts necessary to 
        carry out the intent referred to in subsection (a).
    (c) Homeland Defense Campaign Plan.--
            (1) Organization, planning, and interoperability.--
                    (A) In general.--The homeland defense campaign plan 
                under subsection (b)(1) shall contain a discussion of 
                the organization and planning of the Department of 
                Defense for homeland defense, including the 
                expectations for interoperability of the Department of 
                Defense with other departments and agencies of the 
                Federal Government and with State and local 
                governments.
                    (B) Content.--The plan shall include the following 
                matters:
                            (i) The duties, definitions, missions, 
                        goals, and objectives of organizations in the 
                        Department of Defense that apply homeland 
                        defense, together with an organizational 
                        assessment with respect to the performance of 
                        the homeland defense mission and a discussion 
                        of any plans for making functional realignments 
                        of organizations, authorities, and 
                        responsibilities for carrying out that mission.
                            (ii) The relationships among the leaders of 
                        the organizations (including the Secretary of 
                        Defense, the Joint Chiefs of Staff, the 
                        Commander in Chief of United States Northern 
                        Command, the Commanders in Chief of the other 
                        regional unified combatant commands, and the 
                        reserve components) in the performance of such 
                        duties.
                            (iii) The reviews, evaluations, and 
                        standards that are established or are to be 
                        established for determining and ensuring the 
                        readiness of the organizations to perform such 
                        duties.
            (2) Response to attack on critical infrastructure.--
                    (A) In general.--The homeland defense campaign plan 
                shall contain an outline of the duties and capabilities 
                of the Department of Defense for responding to an 
                attack on critical infrastructure of the United States, 
                including responding to an attack on critical 
                infrastructure of the department, by means of a weapon 
                of mass destruction or a CBRNE weapon or by a cyber 
                means.
                    (B) Various attack scenarios.--The outline shall 
                specify, for each major category of attack by a means 
                described in subparagraph (A), the variations in the 
                duties, responses, and capabilities of the various 
                Department of Defense organizations that result from 
                the variations in the means of the attack.
                    (C) Deficiencies.--The outline shall identify any 
                deficiencies in capabilities and set forth a plan for 
                rectifying any such deficiencies.
                    (D) Legal impediments.--The outline shall identify 
                and discuss each impediment in law to the effective 
                performance of the homeland defense mission.
            (3) Roles and responsibilities in interagency process.--
                    (A) In general.--The homeland defense campaign plan 
                shall contain a discussion of the roles and 
                responsibilities of the Department of Defense in the 
                interagency process of policymaking and planning for 
                homeland defense.
                    (B) Integration with state and local activities.--
                The homeland defense campaign plan shall include a 
                discussion of Department of Defense plans to integrate 
                Department of Defense homeland defense activities with 
                the homeland defense activities of other departments 
                and agencies of the United States and the homeland 
                defense activities of State and local governments, 
                particularly with regard to issues relating to CBRNE 
                and cyber attacks.
    (d) Intelligence Capabilities.--The discussion of the relationship 
between the intelligence capabilities and the performance of the 
homeland defense mission under subsection (b)(2) shall include the 
following matters:
            (1) Roles and missions.--The roles and missions of the 
        Department of Defense for the employment of the intelligence 
        capabilities of the department in homeland defense.
            (2) Interagency relationships.--A discussion of the 
        relationship between the Department of Defense and the other 
        departments and agencies of the United States that have duties 
        for collecting or analyzing intelligence in relation to 
        homeland defense, particularly in light of the conflicting 
        demands of duties relating to the collection and analysis of 
        domestic intelligence and duties relating to the collection and 
        analysis of foreign intelligence.
            (3) Intelligence-related changes.--Any changes that are 
        necessary in the Department of Defense in order to provide 
        effective intelligence support for the performance of homeland 
        defense missions, with respect to--
                    (A) the preparation of threat assessments and other 
                warning products by the Department of Defense;
                    (B) collection of terrorism-related intelligence 
                through human intelligence sources, signals 
                intelligence sources, and other intelligence sources; 
                and
                    (C) intelligence policy, capabilities, and 
                practices.
            (4) Legal impediments.--Any impediments in law to the 
        effective performance of intelligence missions in support of 
        homeland defense.
    (e) Threat and Vulnerability Assessment.--
            (1) Content.--The compliance-based national threat and 
        vulnerability assessment under subsection (b)(3) shall include 
        a discussion of the following matters:
                    (A) Critical facilities.--The threat of terrorist 
                attack on critical facilities, programs, and systems of 
                the United States, together with the capabilities of 
the Department of Defense to deter and respond to any such attack.
                    (B) DoD vulnerability.--The vulnerability of 
                installations, facilities, and personnel of the 
                Department of Defense to attack by persons using 
                weapons of mass destruction, CBRNE weapons, or cyber 
                means.
                    (C) Balanced survivability assessment.--Plans to 
                conduct a balanced survivability assessment for use in 
                determining the vulnerabilities of targets referred to 
                in subparagraphs (A) and (B).
                    (D) Process.--Plans, including timelines and 
                milestones, necessary to develop a process for 
                conducting compliance-based vulnerability assessments 
                for critical infrastructure, together with the 
                standards to be used for ensuring that the process is 
                executable.
            (2) Definition of compliance-based.--In subsection (b)(3) 
        and paragraph (1)(D) of this subsection, the term ``compliance-
        based'', with respect to an assessment, means that the 
        assessment is conducted under policies and procedures that 
        require correction of each deficiency identified in the 
        assessment to a standard set forth in Department of Defense 
        Instruction 2000.16 or another applicable Department of Defense 
        instruction, directive, or policy.
    (f) Training and Exercising.--The discussion of the Department of 
Defense plans for training and exercising for the performance of the 
homeland defense mission under subsection (b)(4) shall contain the 
following matters:
            (1) Military education.--The plans for the training and 
        education of members of the Armed Forces specifically for 
        performance of homeland defense missions, including any 
        anticipated changes in the curriculum in--
                    (A) the National Defense University, the war 
                colleges of the Armed Forces, graduate education 
                programs, and other senior military schools and 
                education programs; and
                    (B) the Reserve Officers' Training Corps program, 
                officer candidate schools, enlisted and officer basic 
                and advanced individual training programs, and other 
                entry level military education and training programs.
            (2) Exercises.--The plans for using exercises and 
        simulation in the training of all components of the Armed 
        Forces, including--
                    (A) plans for integrated training with departments 
                and agencies of the United States outside the 
                Department of Defense and with agencies of State and 
                local governments; and
                    (B) plans for developing an opposing force that, 
                for the purpose of developing potential scenarios of 
                terrorist attacks on targets inside the United States, 
                simulates a terrorist group having the capability to 
                engage in such attacks.
    (g) Bioterrorism Initiative.--The evaluation of the need for a 
Department of Defense bioterrorism initiative under subsection (b)(5) 
shall include a discussion that identifies and evaluates options for 
potential action in such an initiative, as follows:
            (1) Planning, training, exercise, evaluation, and 
        funding.--Options for--
                    (A) refining the plans of the Department of Defense 
                for biodefense to include participation of other 
                departments and agencies of the United States and State 
                and local governments;
                    (B) increasing biodefense training, exercises, and 
                readiness evaluations by the Department of Defense, 
                including training, exercises, and evaluations that 
                include participation of other departments and agencies 
                of the United States and State and local governments;
                    (C) increasing Department of Defense funding for 
                biodefense; and
                    (D) integrating other departments and agencies of 
                the United States and State and local governments into 
                the plans, training, exercises, evaluations, and 
                resourcing.
            (2) Disease surveillance.--Options for the Department of 
        Defense to develop an integrated disease surveillance detection 
        system and to improve systems for communicating information and 
        warnings of the incidence of disease to recipients within the 
        Department of Defense and to other departments and agencies of 
        the United States and State and local governments.
            (3) Emergency management standard.--Options for broadening 
        the scope of the Revised Emergency Management Standard of the 
        Joint Commission on Accreditation of Healthcare Organizations 
        by including the broad and active participation of Federal, 
        State, and local governmental agencies that are expected to 
        respond in any event of a CBRNE or cyber attack.
            (4) Laboratory response network.--Options for the 
        Department of Defense--
                    (A) to participate in the laboratory response 
                network for bioterrorism; and
                    (B) to increase the capacity of Department of 
                Defense laboratories rated by the Secretary of Defense 
                as level D laboratories to facilitate participation in 
                the network.
    (h) Chemical Biological Incident Response Teams.--The evaluation of 
the need for and feasibility of developing and fielding Department of 
Defense regional chemical biological incident response teams under 
subsection (b)(6) shall include a discussion and evaluation of the 
following options:
            (1) Regional teams.--Options for the Department of Defense, 
        using the chemical biological incident response force as a 
        model, to develop, equip, train, and provide transportation for 
        five United States based, strategically located, regional 
        chemical biological incident response teams.
            (2) Resourcing.--Options and preferred methods for 
        providing the resources and personnel necessary for developing 
        and fielding any such teams.
    (i) Definitions.--In this section:
            (1) CBRNE.--The term ``CBRNE'' means chemical, biological, 
        radiological, nuclear, or explosive.
            (2) Weapon of mass destruction.--The term ``weapon of mass 
        destruction'' has the meaning given such term in section 1403 
        of the Defense Against Weapons of Mass Destruction Act of 1996 
        (50 U.S.C. 2302).

SEC. 1045. STRATEGY FOR IMPROVING PREPAREDNESS OF MILITARY 
              INSTALLATIONS FOR INCIDENTS INVOLVING WEAPONS OF MASS 
              DESTRUCTION.

    (a) Comprehensive Plan.--The Secretary of Defense shall develop a 
comprehensive plan for improving the preparedness of military 
installations for preventing and responding to incidents involving use 
or threat of use of weapons of mass destruction.
    (b) Content.--The comprehensive plan shall set forth the following:
            (1) A strategy that--
                    (A) identifies--
                            (i) long-term goals and objectives;
                            (ii) resource requirements; and
                            (iii) factors beyond the control of the 
                        Secretary that could impede the achievement of 
                        the goals and objectives; and
                    (B) includes a discussion of--
                            (i) the extent to which local, regional, or 
                        national military response capabilities are to 
                        be developed and used; and
                            (ii) how the Secretary will coordinate 
                        these capabilities with local, regional, or 
                        national civilian capabilities.
            (2) A performance plan that--
                    (A) provides a reasonable schedule, with 
                milestones, for achieving the goals and objectives of 
                the strategy;
                    (B) performance criteria for measuring progress in 
                achieving the goals and objectives;
                    (C) a description of the process, together with a 
                discussion of the resources, necessary to achieve the 
                goals and objectives;
                    (D) a description of the process for evaluating 
                results.
    (c) Submittal to Congress.--The Secretary shall submit the 
comprehensive plan to the Committees on Armed Services of the Senate 
and the House of Representatives not later than 180 days after the date 
of the enactment of this Act.
    (d) Comptroller General Review and Report.--Not later than 60 days 
after the Secretary submits the comprehensive plan to Congress under 
subsection (c), the Comptroller General shall review the plan and 
submit an assessment of the plan to the committees referred to in that 
subsection.
    (e) Annual Report.--(1) In each of 2004, 2005, and 2006, the 
Secretary of Defense shall include a report on the comprehensive plan 
in the materials that the Secretary submits to Congress in support of 
the budget submitted by the President such year pursuant to section 
1105(a) of title 31, United States Code.
    (2) The report shall include--
            (A) a discussion of any revision that the Secretary has 
        made in the comprehensive plan since the last report; and
            (B) an assessment of the progress made in achieving the 
        goals and objectives of the strategy set forth in the plan.
    (3) No report is required under this subsection after the Secretary 
submits under this subsection a report containing a declaration that 
the goals and objectives set forth in the strategy have been achieved.

                       Subtitle E--Other Matters

SEC. 1061. CONTINUED APPLICABILITY OF EXPIRING GOVERNMENTWIDE 
              INFORMATION SECURITY REQUIREMENTS TO THE DEPARTMENT OF 
              DEFENSE.

    (a) In General.--Chapter 131 of title 10, United States Code, is 
amended by inserting after section 2224 the following new section:
``Sec. 2224a. Information security: continued applicability of expiring 
              Governmentwide requirements to the Department of Defense
    ``(a) In General.--The provisions of subchapter II of chapter 35 of 
title 44 shall continue to apply with respect to the Department of 
Defense, notwithstanding the expiration of authority under section 3536 
of such title.
    ``(b) Responsibilities.--In administering the provisions of 
subchapter II of chapter 35 of title 44 with respect to the Department 
of Defense after the expiration of authority under section 3536 of such 
title, the Secretary of Defense shall perform the duties set forth in 
that subchapter for the Director of the Office of Management and 
Budget.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by inserting after the item relating to section 
2224 the following new item:

``2224a. Information security: continued applicability of expiring 
                            Governmentwide requirements to the 
                            Department of Defense.''.

SEC. 1062. ACCEPTANCE OF VOLUNTARY SERVICES OF PROCTORS FOR 
              ADMINISTRATION OF ARMED SERVICES VOCATIONAL APTITUDE 
              BATTERY.

    Section 1588(a) of title 10, United States Code, is amended by 
adding at the end the following new paragraph:
            ``(6) Voluntary services as a proctor for the 
        administration of the Armed Services Vocational Aptitude 
        Battery.''.

SEC. 1063. EXTENSION OF AUTHORITY FOR SECRETARY OF DEFENSE TO SELL 
              AIRCRAFT AND AIRCRAFT PARTS FOR USE IN RESPONDING TO OIL 
              SPILLS.

    (a) Four-Year Extension.--Subsection (a)(1) of section 740 of the 
Wendell H. Ford Aviation Investment and Reform Act for the 21st Century 
(Public Law 106-181; 114 Stat. 173; 10 U.S.C. 2576 note) is amended by 
striking ``September 30, 2002'' and inserting ``September 30, 2006''.
    (b) Additional Report.--Subsection (f) of such section is amended 
by striking ``March 31, 2002'' and inserting ``March 31, 2006''.

SEC. 1064. AMENDMENTS TO IMPACT AID PROGRAM.

    (a) Eligibility for Heavily Impacted Local Educational Agencies 
Affected by Privatization of Military Housing.--Section 8003(b)(2) of 
the Elementary and Secondary Education Act of 1965 (20 U.S.C. 
7703(b)(2)) is amended by adding at the end the following:
                    ``(H) Eligibility for heavily impacted local 
                educational agencies affected by privatization of 
                military housing.--
                            ``(i) In general.--For any fiscal year 
                        beginning with fiscal year 2003, a heavily 
                        impacted local educational agency that received 
                        a basic support payment under subparagraph (A) 
                        for the prior fiscal year, but is ineligible 
                        for such payment for the current fiscal year 
                        under subparagraph (B) or (C), as the case may 
                        be, by reason of the conversion of military 
                        housing units to private housing described in 
                        clause (ii), shall be deemed to meet the 
                        eligibility requirements under subparagraph (B) 
                        or (C), as the case may be, for the period 
                        during which the housing units are undergoing 
                        such conversion, and shall be paid under the 
                        same provisions of subparagraph (D) or (E) as 
                        the agency was paid in the prior fiscal year.
                            ``(ii) Conversion of military housing units 
                        to private housing described.--For purposes of 
                        clause (i), `conversion of military housing 
                        units to private housing' means the conversion 
                        of military housing units to private housing 
                        units pursuant to subchapter IV of chapter 169 
                        of title 10, United States Code, or pursuant to 
                        any other related provision of law.''.
    (b) Coterminous Military School Districts.--Section 8003(a) of the 
Elementary and Secondary Education Act of 1965 (20 U.S.C. 7703(a)) is 
amended by adding at the end the following:
            ``(6) Coterminous military school districts.--For purposes 
        of computing the amount of a payment for a local educational 
        agency for children described in paragraph (1)(D)(i), the 
        Secretary shall consider such children to be children described 
        in paragraph (1)(B) if the agency is a local educational agency 
        whose boundaries are the same as a Federal military 
        installation.''.

       TITLE XI--DEPARTMENT OF DEFENSE CIVILIAN PERSONNEL POLICY

SEC. 1101. EXTENSION OF AUTHORITY TO PAY SEVERANCE PAY IN A LUMP SUM.

    Section 5595(i)(4) of title 5, United States Code, is amended by 
striking ``October 1, 2003'' and inserting ``October 1, 2006''.

SEC. 1102. EXTENSION OF VOLUNTARY SEPARATION INCENTIVE PAY AUTHORITY.

    Section 5597(e) of title 5, United States Code, is amended by 
striking ``September 30, 2003'' and inserting ``September 30, 2006''.

SEC. 1103. EXTENSION OF COST-SHARING AUTHORITY FOR CONTINUED FEHBP 
              COVERAGE OF CERTAIN PERSONS AFTER SEPARATION FROM 
              EMPLOYMENT.

    Section 8905a(d)(4)(B) of title 5, United States Code, is amended--
            (1) by striking ``October 1, 2003'' both places it appears 
        and inserting ``October 1, 2006''; and
            (2) by striking ``February 1, 2004'' in clause (ii) and 
        inserting ``February 1, 2007''.

SEC. 1104. ELIGIBILITY OF NONAPPROPRIATED FUNDS EMPLOYEES TO 
              PARTICIPATE IN THE FEDERAL EMPLOYEES LONG-TERM CARE 
              INSURANCE PROGRAM.

    Section 9001(1) of title 5, United States Code, is amended--
            (1) by striking ``and'' at the end of subparagraph (B);
            (2) by striking the comma at the end of subparagraph (C) 
        and inserting ``; and''; and
            (3) by inserting after subparagraph (C) the following new 
        subparagraph:
                    ``(D) an employee paid from nonappropriated funds 
                referred to in section 2105(c) of this title;''.

SEC. 1105. INCREASED MAXIMUM PERIOD OF APPOINTMENT UNDER THE 
              EXPERIMENTAL PERSONNEL PROGRAM FOR SCIENTIFIC AND 
              TECHNICAL PERSONNEL.

    Section 1101(c)(1) of the Strom Thurmond National Defense 
Authorization Act for Fiscal Year 1999 (Public Law 105-261; 112 Stat. 
2140; 5 U.S.C. 3104 note) is amended by striking ``4 years'' and 
inserting ``5 years''.

SEC. 1106. QUALIFICATION REQUIREMENTS FOR EMPLOYMENT IN DEPARTMENT OF 
              DEFENSE PROFESSIONAL ACCOUNTING POSITIONS.

    (a) Professional Certification.--The Secretary of Defense may 
prescribe regulations that require a person employed in a professional 
accounting position within the Department of Defense to be a certified 
public accountant and that apply the requirement to all such positions 
or to selected positions, as the Secretary considers appropriate.
    (b) Waivers and Exemptions.--(1) The Secretary may include in the 
regulations imposing a requirement under subsection (a), as the 
Secretary considers appropriate--
            (A) any exemption from the requirement; and
            (B) authority to waive the requirement.
    (2) The Secretary shall include in the regulations an exemption for 
persons employed in positions covered by the requirement before the 
date of the enactment of this Act.
    (c) Exclusive Authority.--No requirement imposed under subsection 
(a), and no waiver or exemption provided in the regulations pursuant to 
subsection (b), shall be subject to review or approval by the Office of 
Personnel Management.
    (d) Definition.--For the purposes of this section, the term 
``professional accounting position'' means a position in the GS-510, 
GS-511, or GS-505 series for which professional accounting duties are 
prescribed.
    (e) Effective Date.--This section shall take effect 120 days after 
the date of the enactment of this Act.

SEC. 1107. HOUSING BENEFITS FOR UNACCOMPANIED TEACHERS REQUIRED TO LIVE 
              AT GUANTANAMO BAY NAVAL STATION, CUBA.

    Section 7(b) of the Defense Department Overseas Teachers Pay and 
Personnel Practices Act (20 U.S.C. 905(b)) is amended--
            (1) by inserting ``(1)'' after ``(b)''; and
            (2) by adding at the end the following new paragraph:
    ``(2)(A) A teacher assigned to teach at Guantanamo Bay Naval 
Station, Cuba, who is not accompanied at such station by any 
dependent--
            ``(i) shall be offered for lease any available military 
        family housing at such station that is suitable for occupancy 
        by the teacher and is not needed to house members of the armed 
        forces and dependents accompanying them or other civilian 
        personnel and any dependents accompanying them; and
            ``(ii) for any period for which such housing is leased to 
        the teacher, shall receive a quarters allowance in the amount 
        determined under paragraph (1).
    ``(B) A teacher is entitled to the quarters allowance in accordance 
with subparagraph (A)(ii) without regard to whether other Government 
furnished quarters are available for occupancy by the teacher without 
charge to the teacher.''.

              TITLE XII--MATTERS RELATING TO OTHER NATIONS

  Subtitle A--Cooperative Threat Reduction With States of the Former 
                              Soviet Union

SEC. 1201. SPECIFICATION OF COOPERATIVE THREAT REDUCTION PROGRAMS AND 
              FUNDS.

    (a) Specification of CTR Programs.--For purposes of section 301 and 
other provisions of this Act, Cooperative Threat Reduction programs are 
the programs specified in section 1501(b) of the National Defense 
Authorization Act for Fiscal Year 1997 (Public Law 104-201; 110 Stat. 
2731; 50 U.S.C. 2362 note).
    (b) Fiscal Year 2003 Cooperative Threat Reduction Funds Defined.--
As used in this title, the term ``fiscal year 2003 Cooperative Threat 
Reduction funds'' means the funds appropriated pursuant to the 
authorization of appropriations in section 301 for Cooperative Threat 
Reduction programs.
    (c) Availability of Funds.--Funds appropriated pursuant to the 
authorization of appropriations in section 301 for Cooperative Threat 
Reduction programs shall be available for obligation for three fiscal 
years.

SEC. 1202. FUNDING ALLOCATIONS.

    (a) Funding for Specific Purposes.--Of the $416,700,000 authorized 
to be appropriated to the Department of Defense for fiscal year 2003 in 
section 301(a)(23) for Cooperative Threat Reduction programs, not more 
than the following amounts may be obligated for the purposes specified:
            (1) For strategic offensive arms elimination in Russia, 
        $70,500,000.
            (2) For strategic nuclear arms elimination in Ukraine, 
        $6,500,000.
            (3) For weapons of mass destruction infrastructure 
        elimination in Ukraine, $8,800,000.
            (4) For weapons of mass destruction infrastructure 
        elimination in Kazakhstan, $9,000,000.
            (5) For weapons transportation security in Russia, 
        $19,700,000.
            (6) For weapons storage security in Russia, $40,000,000.
            (7) For weapons of mass destruction proliferation 
        prevention in the former Soviet Union, $40,000,000.
            (8) For biological weapons proliferation prevention 
        activities in the former Soviet Union, $55,000,000.
            (9) For chemical weapons destruction in Russia, 
        $133,600,000.
            (10) For activities designated as Other Assessments/
        Administrative Support, $14,700,000.
            (11) For defense and military contacts, $18,900,000.
    (b) Report on Obligation or Expenditure of Funds for Other 
Purposes.--No fiscal year 2003 Cooperative Threat Reduction funds may 
be obligated or expended for a purpose other than a purpose listed in 
paragraphs (1) through (11) of subsection (a) until 30 days after the 
date that the Secretary of Defense submits to Congress a report on the 
purpose for which the funds will be obligated or expended and the 
amount of funds to be obligated or expended. Nothing in the preceding 
sentence shall be construed as authorizing the obligation or 
expenditure of fiscal year 2003 Cooperative Threat Reduction funds for 
a purpose for which the obligation or expenditure of such funds is 
specifically prohibited under this title or any other provision of law.
    (c) Limited Authority To Vary Individual Amounts.--(1) Subject to 
paragraph (2), in any case in which the Secretary of Defense determines 
that it is necessary to do so in the national interest, the Secretary 
may obligate amounts appropriated for fiscal year 2003 for a purpose 
listed in any of the paragraphs in subsection (a) in excess of the 
amount specifically authorized for such purpose.
    (2) An obligation of funds for a purpose stated in any of the 
paragraphs in subsection (a) in excess of the specific amount 
authorized for such purpose may be made using the authority provided in 
paragraph (1) only after--
            (A) the Secretary submits to Congress notification of the 
        intent to do so together with a complete discussion of the 
        justification for doing so; and
            (B) 15 days have elapsed following the date of the 
        notification.

SEC. 1203. AUTHORIZATION OF USE OF COOPERATIVE THREAT REDUCTION FUNDS 
              FOR PROJECTS AND ACTIVITIES OUTSIDE THE FORMER SOVIET 
              UNION.

    (a) Cooperative Threat Reduction Programs and Funds.--For purposes 
of this section:
            (1) Cooperative Threat Reduction programs are--
                    (A) the programs specified in section 1501(b) of 
                the National Defense Authorization Act for Fiscal Year 
                1997 (Public Law 104-201; 110 Stat. 2731; 50 U.S.C. 
                2362 note); and
                    (B) any other similar programs, as designated by 
                the Secretary of Defense, to address critical emerging 
                proliferation threats in the states of the former 
                Soviet Union that jeopardize United States national 
                security.
            (2) Cooperative Threat Reduction funds, for a fiscal year, 
        are the funds authorized to be appropriated for Cooperative 
        Threat Reduction programs for that fiscal year.
    (b) Authorization of Use of CTR Funds for Threat Reduction 
Activities Outside the Former Soviet Union.--(1) Notwithstanding any 
other provision of law and subject to the succeeding provisions of this 
section, the Secretary of Defense may obligate and expend Cooperative 
Threat Reduction funds for fiscal year 2003, or Cooperative Threat 
Reduction funds for a fiscal year before fiscal year 2003 that remain 
available for obligation as of the date of the enactment of this Act, 
for proliferation threat reduction projects and activities outside the 
states of the former Soviet Union if the Secretary determines that such 
projects and activities will--
            (A) assist the United States in the resolution of critical 
        emerging proliferation threats; or
            (B) permit the United States to take advantage of 
        opportunities to achieve long-standing United States 
        nonproliferation goals.
    (2) The amount that may be obligated under paragraph (1) in any 
fiscal year for projects and activities described in that paragraph may 
not exceed $50,000,000.
    (c) Authorized Uses of Funds.--The authority under subsection (b) 
to obligate and expend Cooperative Threat Reduction funds for a project 
or activity includes authority to provide equipment, goods, and 
services for the project or activity, but does not include authority to 
provide cash directly to the project or activity.
    (d) Source and Replacement of Funds Used.--(1) The Secretary shall, 
to the maximum extent practicable, ensure that funds for projects and 
activities under subsection (b) are derived from funds that would 
otherwise be obligated for a range of Cooperative Threat Reduction 
programs, so that no particular Cooperative Threat Reduction program is 
the exclusive or predominant source of funds for such projects and 
activities.
    (2) If the Secretary obligates Cooperative Threat Reduction funds 
under subsection (b) in a fiscal year, the first budget of the 
President that is submitted under section 1105(a) of title 31, United 
States Code, after such fiscal year shall set forth, in addition to any 
other amounts requested for Cooperative Threat Reduction programs in 
the fiscal year covered by such budget, a request for Cooperative 
Threat Reduction funds in the fiscal year covered by such budget in an 
amount equal to the amount so obligated. The request shall also set 
forth the Cooperative Threat Reduction program or programs for which 
such funds would otherwise have been obligated, but for obligation 
under subsection (b).
    (3) Amounts authorized to be appropriated pursuant to a request 
under paragraph (2) shall be available for the Cooperative Threat 
Reduction program or programs set forth in the request under the second 
sentence of that paragraph.
    (e) Limitation on Obligation of Funds.--Except as provided in 
subsection (f), the Secretary may not obligate and expend Cooperative 
Threat Reduction funds for a project or activity under subsection (b) 
until 30 days after the date on which the Secretary submits to the 
congressional defense committees a report on the purpose for which the 
funds will be obligated and expended, and the amount of the funds to be 
obligated and expended.
    (f) Exception.--(1) The Secretary may obligate and expend 
Cooperative Threat Reduction funds for a project or activity under 
subsection (b) without regard to subsection (e) if the Secretary 
determines that a critical emerging proliferation threat warrants 
immediate obligation and expenditure of such funds.
    (2) Not later than 72 hours after first obligating funds for a 
project or activity under paragraph (1), the Secretary shall submit to 
the congressional defense committees a report containing a detailed 
justification for the obligation of funds. The report on a project or 
activity shall include the following:
            (A) A description of the critical emerging proliferation 
        threat to be addressed, or the long-standing United States 
        nonproliferation goal to be achieved, by the project or 
        activity.
            (B) A description of the agreement, if any, under which the 
        funds will be used, including whether or not the agreement 
        provides that the funds will not be used for purposes contrary 
        to the national security interests of the United States.
            (C) A description of the contracting process, if any, that 
        will be used in the implementation of the project or activity.
            (D) An analysis of the effect of the obligation of funds 
        for the project or activity on ongoing Cooperative Threat 
        Reduction programs.
            (E) An analysis of the need for additional or follow-up 
        threat reduction assistance, including whether or not the need 
        for such assistance justifies the establishment of a new 
        cooperative threat reduction program or programs to account for 
        such assistance.
            (F) A description of the mechanisms to be used by the 
        Secretary to assure that proper audits and examinations of the 
        project or activity are carried out.
    (g) Report on Establishment of New Cooperative Threat Reduction 
Programs.--(1) If the Secretary employs the authority in subsection (b) 
in any two fiscal years, the Secretary shall submit to Congress a 
report on the advisability of establishing one or more new cooperative 
threat reduction programs to account for projects and activities funded 
using such authority.
    (2) The report required by paragraph (1) shall be submitted along 
with the budget justification materials in  support of the Department 
of Defense budget (as submitted with the budget of the President under 
section 1105(a) of title 31, United States Code) in the first budget 
submitted after the end of the two consecutive fiscal years referred to 
in that paragraph.

SEC. 1204. WAIVER OF LIMITATIONS ON ASSISTANCE UNDER PROGRAMS TO 
              FACILITATE COOPERATIVE THREAT REDUCTION AND 
              NONPROLIFERATION.

    (a) Assistance Under Cooperative Threat Reduction Act of 1993.--
Section 1203 of the Cooperative Threat Reduction Act of 1993 (title XII 
of Public Law 103-160; 107 Stat. 1778; 22 U.S.C. 5952) is amended by 
adding at the end the following new subsection:
    ``(e) Waiver of Restrictions.--(1) The restrictions in subsection 
(d) shall cease to apply to a state for a year if the President submits 
to the Speaker of the House of Representative and the President pro 
tempore of the Senate a written certification that the waiver of such 
restrictions in such year is important to the national security 
interests of the United States, together with a report containing the 
following:
            ``(A) A description of the activity or activities that 
        prevent the President from certifying that the state is 
        committed to the matters set forth in subsection (d) in such 
        year as otherwise provided for in that subsection.
            ``(B) A description of the strategy, plan, or policy of the 
        President for promoting the commitment of the state to such 
        matters, notwithstanding the waiver.
    ``(2) The matter included in the report under paragraph (1) shall 
be submitted in unclassified form, but may include a classified 
annex.''.
    (b) Administration of Restrictions on Assistance.--Subsection (d) 
of that section is amended--
            (1) by striking ``any year'' and inserting ``any fiscal 
        year''; and
            (2) by striking ``that year'' and inserting ``such fiscal 
        year''.
    (c) Eligibility Requirements Under FREEDOM Support Act.--Section 
502 of the FREEDOM Support Act (Public Law 102-511; 106 Stat. 3338; 22 
U.S.C. 5852) is amended--
            (1) by striking ``Funds'' and inserting ``(a) 
        Eligibility.--Except as provided in subsection (b), funds''; 
        and
            (2) by adding at the end the following new subsection:
    ``(b) Waiver of Eligibility Requirements.--(1) Funds may be 
obligated for a fiscal year under subsection (a) for assistance or 
other programs and activities for an independent state of the former 
Soviet Union that does not meet one or more of the requirements for 
eligibility under paragraphs (1) through (4) of that subsection if the 
President certifies in writing to the Congress that the waiver of such 
requirements in such fiscal year is important to the national security 
interests of the United States.
    ``(2) At the time of the exercise of the authority in paragraph (1) 
with respect to an independent state of the former Soviet Union for a 
fiscal year, the President shall submit to the congressional defense 
committees a report on the following:
            ``(A) A description of the activity or activities that 
        prevent the President from certifying that the state is 
        committed to each matter in subsection (a) in such fiscal year 
        to which the waiver under paragraph (1) applies.
            ``(B) A description of the strategy, plan, or policy of the 
        President for promoting the commitment of the state to each 
        such matter, notwithstanding the waiver.
    ``(3) In this subsection, the term `congressional defense 
committees' means--
            ``(A) the Committee on Armed Services and the Committee on 
        Appropriations of the Senate; and
            ``(B) the Committee on Armed Services and the Committee on 
        Appropriations of the House of Representatives.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on October 1, 2002.

                       Subtitle B--Other Matters

SEC. 1211. ADMINISTRATIVE SUPPORT AND SERVICES FOR COALITION LIAISON 
              OFFICERS.

    (a) Authority.--Chapter 6 of title 10, United States Code, is 
amended by adding at the end the following new section:
``Sec. 169. Administrative support and services for coalition liaison 
              officers
    ``(a) Authority.--The Secretary of Defense may provide 
administrative services and support for the performance of duties by 
any liaison officer of another nation involved in a coalition while the 
liaison officer is assigned temporarily to the headquarters of a 
combatant command, component command, or subordinate operational 
command of the United States in connection with the planning for or 
conduct of a coalition operation.
    ``(b) Travel, Subsistence, and Other Expenses.--The Secretary may 
pay the travel, subsistence, and similar personal expenses of a liaison 
officer of a developing country in connection with the assignment of 
that liaison officer to the headquarters of a combatant command as 
described in subsection (a) if the assignment is requested by the 
commander of the combatant command.
    ``(c) Reimbursement.-- To the extent that the Secretary determines 
appropriate, the Secretary may provide the services and support 
authorized under subsections (a) and (b) with or without reimbursement 
from (or on behalf of) the recipients.
    ``(d) Definitions.--In this section:
            ``(1) The term `administrative services and support' 
        includes base or installation support services, office space, 
        utilities, copying services, fire and police protection, and 
        computer support.
            ``(2) The term `coalition' means an ad hoc arrangement 
        between or among the United States and one or more other 
        nations for common action.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter 6 is amended by adding at the end the following new item:

``169. Administrative support and services for coalition liaison 
                            officers.''.

SEC. 1212. USE OF WARSAW INITIATIVE FUNDS FOR TRAVEL OF OFFICIALS FROM 
              PARTNER COUNTRIES.

    Section 1051(b) of title 10, United States Code, is amended--
            (1) in paragraph (1), by striking ``paragraph (2)'' and 
        inserting ``paragraphs (2) and (3)'';
            (2) by redesignating paragraph (3) as paragraph (4); and
            (3) by inserting after paragraph (2) the following new 
        paragraph (3):
    ``(3) In the case of defense personnel of a country that is 
participating in the Partnership for Peace program of the North 
Atlantic Treaty Organization (NATO), expenses authorized to be paid 
under subsection (a) may be paid in connection with travel of personnel 
to the territory of any of the countries participating in the 
Partnership for Peace program or of any of the NATO member 
countries.''.

SEC. 1213. SUPPORT OF UNITED NATIONS-SPONSORED EFFORTS TO INSPECT AND 
              MONITOR IRAQI WEAPONS ACTIVITIES.

    (a) Limitation on Amount of Assistance in Fiscal Year 2003.--The 
total amount of the assistance for fiscal year 2003 that is provided by 
the Secretary of Defense under section 1505 of the Weapons of Mass 
Destruction Control Act of 1992 (22 U.S.C. 5859a) as activities of the 
Department of Defense in support of activities under that Act may not 
exceed $15,000,000.
    (b) Extension of Authority To Provide Assistance.--Subsection (f) 
of section 1505 of the Weapons of Mass Destruction Control Act of 1992 
(22 U.S.C. 5859a) is amended by striking ``2002'' and inserting 
``2003''.

SEC. 1214. ARCTIC AND WESTERN PACIFIC ENVIRONMENTAL COOPERATION 
              PROGRAM.

    (a) In General.--(1) Subchapter II of chapter 138 of title 10, 
United States Code, is amended by adding at the end the following new 
section:
``Sec. 2350m. Arctic and Western Pacific Environmental Cooperation 
              Program
    ``(a) Authority To Conduct Program.--The Secretary of Defense may, 
with the concurrence of the Secretary of State, conduct on a 
cooperative basis with countries located in the Arctic and Western 
Pacific regions a program of environmental activities provided for in 
subsection (b) in such regions. The program shall be known as the 
`Arctic and Western Pacific Environmental Cooperation Program'.
    ``(b) Program Activities.--(1) Except as provided in paragraph (2), 
activities under the program under subsection (a) may include 
cooperation and assistance on environmental matters in the Arctic and 
Western Pacific regions among elements of the Department of Defense and 
the military departments or agencies of countries located in such 
regions.
    ``(2) Activities under the program may not include activities 
relating to the following:
            ``(A) The conduct of any peacekeeping exercise or other 
        peacekeeping-related activity with the Russian Federation.
            ``(B) The provision of housing.
            ``(C) The provision of assistance to promote environmental 
        restoration.
            ``(D) The provision of assistance to promote job 
        retraining.
    ``(c) Limitation on Funding for Projects Other Than Radiological 
Projects.--Not more than 20 percent of the amount made available for 
the program under subsection (a) in any fiscal year may be available 
for projects under the program other than projects on radiological 
matters.
    ``(d) Annual Report.--(1) Not later than March 1, 2003, and each 
year thereafter, the Secretary of Defense shall submit to Congress a 
report on activities under the program under subsection (a) during the 
preceding fiscal year.
    ``(2) The report on the program for a fiscal year under paragraph 
(1) shall include the following:
            ``(A) A description of the activities carried out under the 
        program during that fiscal year, including a separate 
        description of each project under the program.
            ``(B) A statement of the amounts obligated and expended for 
        the program during that fiscal year, set forth in aggregate and 
        by project.
            ``(C) A statement of the life cycle costs of each project, 
        including the life cycle costs of such project as of the end of 
        that fiscal year and an estimate of the total life cycle costs 
        of such project upon completion of such project.
            ``(D) A statement of the participants in the activities 
        carried out under the program during that fiscal year, 
        including the elements of the Department of Defense and the 
        military departments or agencies of other countries.
            ``(E) A description of the contributions of the military 
        departments and agencies of other countries to the activities 
        carried out under the program during that fiscal year, 
        including any financial or other contributions to such 
        activities.''.
    (2) The table of sections at the beginning of that subchapter is 
amended by adding at the end the following new item:

``2350m. Arctic and Western Pacific Environmental Cooperation 
                            Program.''.
    (b) Repeal of Superseded Authority on Arctic Military Cooperation 
Program.--Section 327 of the Strom Thurmond National Defense 
Authorization Act for Fiscal Year 1999 (Public Law 105-261; 112 Stat. 
1965) is repealed.




                                                       Calendar No. 371

107th CONGRESS

  2d Session

                                S. 2515

_______________________________________________________________________

                                 A BILL

     To authorize appropriations for fiscal year 2003 for military 
    activities of the Department of Defense, to prescribe personnel 
  strengths for such fiscal year for the Armed Forces, and for other 
                               purposes.

_______________________________________________________________________

                 May 15 (legislative day, May 9), 2002

                 Read twice and placed on the calendar