[Congressional Record Volume 140, Number 83 (Monday, June 27, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: June 27, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
              FEDERAL ACQUISITION IMPROVEMENT ACT OF 1994

  Mr. CONYERS. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 2238) to amend laws relating to Federal procurement, to 
authorize functions and activities under the Federal Property and 
Administrative Services Act of 1949, and for other purposes, as 
amended.
  The Clerk read as follows:

                               H.R. 2238

       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 ``Federal Acquisition 
     Improvement Act of 1994''.

     SEC. 2. TABLE OF CONTENTS.

       The table of contents for this Act is as follows:

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

                      TITLE I--CONTRACT FORMATION

                    Subtitle A--Competition Statutes

                  Part I--Armed Services Acquisitions


                  subpart a--competition requirements

Sec. 1001. References to Federal Acquisition Regulation.
Sec. 1002. Establishment or maintenance of alternative sources of 
              supply.
Sec. 1003. Clarification of approval authority for use of procedures 
              other than full and open competition.


        subpart b--planning, solicitation, evaluation, and award

Sec. 1011. Source selection factors.
Sec. 1012. Solicitation provision regarding evaluation of purchase 
              options.
Sec. 1013. Prompt notice of award.
Sec. 1014. Post-award debriefings.
Sec. 1015. Protest file.
Sec. 1016. Agency decisions on protests.
Sec. 1017. Award of multiple contracts.


                     subpart c--kinds of contracts

Sec. 1021. Repeal of requirement for secretarial determination 
              regarding use of cost type or incentive contract.


     subpart d--miscellaneous provisions for the encouragement of 
                              competition

Sec. 1031. Repeal of requirement for annual report by advocates for 
              competition.

                 Part II--Civilian Agency Acquisitions


                  subpart a--competition requirements

Sec. 1051. References to Federal Acquisition Regulation.
Sec. 1052. Establishment or maintenance of alternative sources of 
              supply.
Sec. 1053. Clarification of approval authority for use of procedures 
              other than full and open competition.


        subpart b--planning, solicitation, evaluation, and award

Sec. 1061. Solicitation, evaluation, and award.
Sec. 1062. Solicitation provision regarding evaluation of purchase 
              options.
Sec. 1063. Prompt notice of award.
Sec. 1064. Post-award debriefings.
Sec. 1065. Protest file.
Sec. 1066. Agency decisions on protests.
Sec. 1067. Award of multiple contracts.


                     subpart c--kinds of contracts

Sec. 1071. Repeal of agency head determination regarding use of cost 
              type or incentive contract.
Sec. 1072. Multiyear contracting authority.
Sec. 1073. Severable services contracts crossing fiscal years.

                    Part III--Acquisitions Generally

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

                   Subtitle B--Truth in Negotiations

                  Part I--Armed Services Acquisitions

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

                 Part II--Civilian Agency Acquisitions

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

                  Subtitle C--Research and Development

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

                    Subtitle D--Procurement Protests

              Part I--Protests to the Comptroller General

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

     Part II--Protests in Procurements of Automatic Data Processing

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

           Subtitle E--Policy, Definitions, and Other Matters

                  Part I--Armed Services Acquisitions

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

                 Part II--Civilian Agency Acquisitions

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

                   TITLE II--CONTRACT ADMINISTRATION

                      Subtitle A--Contract Payment

                  Part I--Armed Services Acquisitions

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

                 Part II--Civilian Agency Acquisitions

Sec. 2051. Contract financing.

                    Part III--Acquisitions Generally

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

                      Subtitle B--Cost Principles

                  Part I--Armed Services Acquisitions

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

                 Part II--Civilian Agency Acquisitions

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

                    Part III--Acquisitions Generally

Sec. 2161. Travel expenses of government contractors.

                Subtitle C--Audit and Access to Records

                  Part I--Armed Services Acquisitions

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

                 Part II--Civilian Agency Acquisitions

Sec. 2251. Authority to examine records of contractors.

                 Subtitle D--Cost Accounting Standards

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

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

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

                    Subtitle F--Claims and Disputes

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

         TITLE III--MAJOR SYSTEMS AND SERVICE SPECIFIC STATUTES

                   Subtitle A--Major Systems Statutes

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

                      Subtitle B--Testing Statutes

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

                  Subtitle C--Civil Reserve Air Fleet

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

                       Subtitle D--Miscellaneous

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

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

              Subtitle A--Simplified Acquisition Threshold

                   Part I--Establishment of Threshold

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

                 Part II--Simplification of Procedures

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

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


                          subpart a--generally

Sec. 4021. Inapplicability of future enacted procurement laws to 
              contracts not exceeding the simplified acquisition 
              threshold.


                 subpart b--armed services acquisitions

Sec. 4031. Inapplicability of certain provisions of law.
Sec. 4032. Conforming amendments relating to inapplicability of certain 
              provisions of law.


                subpart c--civilian agency acquisitions

Sec. 4041. Inapplicability of certain provisions of law.
Sec. 4042. Conforming amendments relating to inapplicability of certain 
              provisions of law.


                   subpart d--acquisitions generally

Sec. 4051. Conformance of certain procurement integrity requirements.
Sec. 4052. Inapplicability of the Drug-Free Workplace Act of 1988.

                     Part IV--Conforming Amendments

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

                    Part V--Revision of Regulations

Sec. 4081. Revision required.

           Subtitle B--Socioeconomic and Small Business Laws

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

               Subtitle C--Miscellaneous Acquisition Laws

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

                     TITLE V--STANDARDS OF CONDUCT

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

                TITLE VI--DEFENSE TRADE AND COOPERATION

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

                      TITLE VII--COMMERCIAL ITEMS

                Subtitle A--Definitions and Regulations

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

                Subtitle B--Armed Services Acquisitions

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

                Subtitle C--Civilian Agency Acquisitions

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

                   Subtitle D--Acquisitions Generally

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

                  TITLE VIII--MISCELLANEOUS PROVISIONS

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

               TITLE IX--EFFECTIVE DATES AND REGULATIONS

Sec. 9001. Effective dates.
Sec. 9002. Regulations.
Sec. 9003. Evaluation by the Comptroller General.
                      TITLE I--CONTRACT FORMATION
                    Subtitle A--Competition Statutes

                  PART I--ARMED SERVICES ACQUISITIONS

                  Subpart A--Competition Requirements

     SEC. 1001. REFERENCES TO FEDERAL ACQUISITION REGULATION.

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

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

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

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

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

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

     SEC. 1011. SOURCE SELECTION FACTORS.

       (a) Content of Solicitation.--Section 2305(a) of title 10, 
     United States Code, is amended--
       (1) in paragraph (2)--
       (A) in subparagraph (A)(i)--
       (i) by striking out ``(and significant subfactors)'' and 
     inserting in lieu thereof ``and significant subfactors'',
       (ii) by inserting after ``price-related factors'' the 
     following: ``and subfactors'', and
       (iii) by inserting after ``nonprice-related factors'' the 
     following: ``and subfactors''; and
       (B) in subparagraph (B)(ii), by striking out subclause (I) 
     and inserting in lieu thereof the following:

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

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

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

     SEC. 1013. PROMPT NOTICE OF AWARD.

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

     SEC. 1014. POST-AWARD DEBRIEFINGS.

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

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

     SEC. 1015. PROTEST FILE.

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

     SEC. 1016. AGENCY DECISIONS ON PROTESTS.

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

     SEC. 1017. AWARD OF MULTIPLE CONTRACTS.

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

                     Subpart C--Kinds of Contracts

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

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

     Subpart D--Miscellaneous Provisions for the Encouragement of 
                              Competition

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

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

                  Subpart A--Competition Requirements

     SEC. 1051. REFERENCES TO FEDERAL ACQUISITION REGULATION.

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

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

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

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

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

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

     SEC. 1061. SOLICITATION, EVALUATION, AND AWARD.

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

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

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

     SEC. 1063. PROMPT NOTICE OF AWARD.

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

     SEC. 1064. POST-AWARD DEBRIEFINGS.

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

     SEC. 1065. PROTEST FILE.

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

     SEC. 1066. AGENCY DECISIONS ON PROTESTS.

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

     SEC. 1067. AWARD OF MULTIPLE CONTRACTS.

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

                     Subpart C--Kinds of Contracts

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

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

     SEC. 1072. MULTIYEAR CONTRACTING AUTHORITY.

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

     ``SEC. 304A. MULTIYEAR CONTRACTS.

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

     SEC. 1073. SEVERABLE SERVICES CONTRACTS CROSSING FISCAL 
                   YEARS.

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

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

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

                    PART III--ACQUISITIONS GENERALLY

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

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

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

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

     SEC. 1093. DISCOURAGEMENT OF NONSTANDARD CONTRACT CLAUSES.

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

     ``SEC. 29. NONSTANDARD CONTRACT CLAUSES.

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

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 1201. STABILIZATION OF DOLLAR THRESHOLD OF 
                   APPLICABILITY.

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

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

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

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

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

     SEC. 1204. CONSISTENCY OF TIME REFERENCES.

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

     SEC. 1205. REPEAL OF SUPERSEDED PROVISION.

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

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

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

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

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

     SEC. 1252. REPEAL OF OBSOLETE PROVISION.

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

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

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

              PART I--PROTESTS TO THE COMPTROLLER GENERAL

     SEC. 1401. PROTEST DEFINED.

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

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

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

     SEC. 1403. DECISIONS ON PROTESTS.

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

     SEC. 1404. REGULATIONS.

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

     PART II--PROTESTS IN PROCUREMENTS OF AUTOMATIC DATA PROCESSING

     SEC. 1431. REVOCATION OF DELEGATIONS OF PROCUREMENT 
                   AUTHORITY.

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

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

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

     SEC. 1433. PERIODS FOR CERTAIN ACTIONS.

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

     SEC. 1434. DISMISSALS OF PROTESTS.

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

     SEC. 1435. AWARD OF COSTS.

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

     SEC. 1436. DISMISSAL AGREEMENTS.

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

     SEC. 1437. MATTERS TO BE COVERED IN REGULATIONS.

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

     SEC. 1438. DEFINITION OF PROTEST.

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

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

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

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 1501. CONGRESSIONAL DEFENSE PROCUREMENT POLICY.

       Section 2301 of title 10, United States Code, is amended to 
     read as follows:

     ``Sec. 2301. Congressional defense procurement policy

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

     SEC. 1502. DEFINITIONS.

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

     SEC. 1503. DELEGATION OF PROCUREMENT FUNCTIONS.

       (a) Consolidation of Delegation Authority.--(1) Section 
     2311 of title 10, United States Code, is amended to read as 
     follows:

     ``Sec. 2311. Assignment and delegation of procurement 
       functions and responsibilities

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

``2311. Assignment and delegation of procurement functions and 
              responsibilities.''.

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

     SEC. 1504. DETERMINATIONS AND DECISIONS.

       Section 2310 of title 10, United States Code, is amended to 
     read as follows:

     ``Sec. 2310. Determinations and decisions

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

     SEC. 1505. RESTRICTIONS ON UNDEFINITIZED CONTRACTUAL ACTIONS.

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

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

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

     SEC. 1507. REGULATIONS FOR BIDS.

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

     SEC. 1551. DEFINITIONS.

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

     SEC. 1552. DELEGATION OF PROCUREMENT FUNCTIONS.

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

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

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

     SEC. 1553. DETERMINATIONS AND DECISIONS.

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

     ``SEC. 313. DETERMINATIONS AND DECISIONS.

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

     SEC. 1554. REPEALS.

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

     SEC. 1555. COOPERATIVE PURCHASING.

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

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 2001. CONTRACT FINANCING.

       (a) Reorganization of Principal Authority Provision.--
     Section 2307 of title 10, United States Code, is amended--
       (1) by striking out the section heading and inserting in 
     lieu thereof the following:

     ``Sec. 2307. Contract financing'';

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

``2307. Contract financing.''.

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

     SEC. 2002. REPEAL OF VOUCHERING PROCEDURES SECTION.

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

     SEC. 2051. CONTRACT FINANCING.

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

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

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

                    PART III--ACQUISITIONS GENERALLY

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

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

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 2101. ALLOWABLE CONTRACT COSTS.

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

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

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

     SEC. 2151. ALLOWABLE CONTRACT COSTS.

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

     ``SEC. 306. ALLOWABLE COSTS.

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

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

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

                    PART III--ACQUISITIONS GENERALLY

     SEC. 2161. TRAVEL EXPENSES OF GOVERNMENT CONTRACTORS.

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

                  PART I--ARMED SERVICES ACQUISITIONS

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

       (a) Authority.--
       (1) In general.--Section 2313 of title 10, United States 
     Code, is amended to read as follows:

     ``Sec. 2313. Examination of records of contractor

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

``2313. Examination of records of contractor.''.

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

     SEC. 2251. AUTHORITY TO EXAMINE RECORDS OF CONTRACTORS.

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

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

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

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

       Section 26(f)(3) of the Office of Federal Procurement 
     Policy Act (41 U.S.C. 422(f)(3)) is amended in the first 
     sentence by striking out ``Not later than 180 days after the 
     date of enactment of this section, the Administrator'' and 
     inserting in lieu thereof ``The Administrator''.
 Subtitle E--Administration of Contract Provisions Relating to Price, 
                     Delivery, and Product Quality

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

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

     SEC. 2402. CONTRACTOR GUARANTEES REGARDING WEAPON SYSTEMS.

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

     SEC. 2501. CERTIFICATION OF CONTRACT CLAIMS.

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

     SEC. 2502. SHIPBUILDING CLAIMS.

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

     SEC. 3001. WEAPON DEVELOPMENT AND PROCUREMENT SCHEDULES.

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

     SEC. 3002. SELECTED ACQUISITION REPORT REQUIREMENT.

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

     SEC. 3003. UNIT COST REPORT REQUIREMENT.

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

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

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

     SEC. 3005. BASELINE DESCRIPTION.

       (a) In General.--Section 2435 of title 10, United States 
     Code, is amended to read as follows:

     ``Sec. 2435. Baseline description

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

``2435. Baseline description.''.

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

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

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

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

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

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

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

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

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

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

     SEC. 3021. DEFINITION OF CONTRACTOR.

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

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

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

     SEC. 3023. USE OF MILITARY INSTALLATIONS BY CONTRACTORS.

       (a) Authority.--Chapter 931 of title 10, United States 
     Code, as amended by section 3022, is further amended by 
     adding at the end the following new section 9513:

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

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

``9513. Use of military installations by Civil Reserve Air Fleet 
              contractors.''.
                       Subtitle D--Miscellaneous

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

       (a) In General.--Section 2202 of title 10, United States 
     Code, is amended to read as follows:

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

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

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

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

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

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

       (a) Limitation.--(1) Chapter 141 of title 10, United States 
     Code, is amended by inserting after section 2401 the 
     following new section:

     ``Sec. 2401a. Lease of vessels, aircraft, and vehicles

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

``2401a. Lease of vessels, aircraft, and vehicles.''.

       (b) Repeal of Superseded Provision.--Section 9081 of Public 
     Law 101-165 (103 Stat. 1147; 10 U.S.C. 2401 note) is 
     repealed.

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

       (a) Repeal.--Section 7299 of title 10, United States Code, 
     is repealed.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 633 of such title is amended by striking 
     out the item relating to section 7299.
  TITLE IV--SIMPLIFIED ACQUISITION THRESHOLD AND SOCIOECONOMIC, SMALL 
                    BUSINESS, AND MISCELLANEOUS LAWS
              Subtitle A--Simplified Acquisition Threshold

                   PART I--ESTABLISHMENT OF THRESHOLD

     SEC. 4001. ESTABLISHMENT OF SIMPLIFIED ACQUISITION THRESHOLD.

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

     ``SEC. 4A. SIMPLIFIED ACQUISITION THRESHOLD.

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

     SEC. 4002. FEDERAL ACQUISITION COMPUTER NETWORK ARCHITECTURE.

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

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

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

     SEC. 4003. IMPLEMENTATION IN ARMED SERVICES.

       (a) Establishment in Title 10.--Chapter 137 of title 10, 
     United States Code, is amended by inserting after section 
     2302 the following new sections:

     ``Sec. 2302a. Simplified acquisition threshold

       ``(a) Simplified Acquisition Threshold.--For purposes of 
     acquisitions by agencies named in section 2303 of this title, 
     the simplified acquisition threshold is as specified in 
     section 4A of the Office of Federal Procurement Policy Act.

     ``Sec. 2302b. Implementation of FACNET capability

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

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

     SEC. 4004. IMPLEMENTATION IN CIVILIAN AGENCIES.

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

     ``SEC. 302A. SIMPLIFIED ACQUISITION THRESHOLD.

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

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

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

                 PART II--SIMPLIFICATION OF PROCEDURES

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

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

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

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

     SEC. 4012. PROCUREMENT NOTICE.

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

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

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

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

                          Subpart A--Generally

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

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

                 Subpart B--Armed Services Acquisitions

     SEC. 4031. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

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

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

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

                Subpart C--Civilian Agency Acquisitions

     SEC. 4041. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

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

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

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

                   Subpart D--Acquisitions Generally

     SEC. 4051. CONFORMANCE OF CERTAIN PROCUREMENT INTEGRITY 
                   REQUIREMENTS.

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

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

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

                     PART IV--CONFORMING AMENDMENTS

     SEC. 4071. ARMED SERVICES ACQUISITIONS.

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

     SEC. 4072. CIVILIAN AGENCY ACQUISITIONS.

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

     SEC. 4073. OFFICE OF FEDERAL PROCUREMENT POLICY ACT.

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

                    PART V--REVISION OF REGULATIONS

     SEC. 4081. REVISION REQUIRED.

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

     SEC. 4101. SMALL BUSINESS PROVISIONS.

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

     SEC. 4102. PAYMENT PROTECTIONS FOR SUBCONTRACTORS AND 
                   SUPPLIERS.

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

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

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

     SEC. 4104. SMALL BUSINESS PROCUREMENT ADVISORY COUNCIL.

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

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

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

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

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

     SEC. 4152. REPEAL OF OBSOLETE PROVISION.

       Section 308 of the Federal Property and Administrative 
     Services Act of 1949 (41 U.S.C. 258) is repealed.
                     TITLE V--STANDARDS OF CONDUCT

     SEC. 5001. CONTRACTING FUNCTIONS PERFORMED BY FEDERAL 
                   PERSONNEL.

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

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

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

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

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

     SEC. 5003. INTERESTS OF MEMBERS OF CONGRESS.

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

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

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

     SEC. 5005. REPEAL OF SUPERSEDED AND OBSOLETE LAWS.

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

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

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

     SEC. 6002. POLICY ON PURCHASE OF FOREIGN GOODS.

       (a) In General.--Section 2533 of title 10, United States 
     Code, is amended to read as follows:

     ``Sec. 2533. Policy on the purchase of foreign goods

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

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

     SEC. 6003. CONSOLIDATION OF MISCELLANEOUS PROCUREMENT 
                   LIMITATIONS.

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

     SEC. 6004. REPEAL OF OBSOLETE AND REDUNDANT PROVISIONS.

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

     SEC. 7001. DEFINITIONS.

       (a) Definitions.--Section 4 of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 403) is amended by adding 
     at the end the following new paragraphs:
       ``(12) The term `commercial item' means any of the 
     following:
       ``(A) Any item of a type customarily used in the course of 
     normal business operations for other than Federal Government 
     purposes, that--
       ``(i) has been sold, leased, or licensed to the general 
     public or to domestic State, or local government entities; or
       ``(ii) has been offered for sale, lease, or license to the 
     general public or to domestic State, or local government 
     entities.
       ``(B) An item intended to be used in the course of normal 
     business operations for other than Federal Government 
     purposes that is not yet available in the commercial 
     marketplace, but will be available in the commercial 
     marketplace in time to satisfy the delivery requirements 
     under a Federal Government solicitation.
       ``(C) Any item that, but for--
       ``(i) modifications of a type customarily available in the 
     commercial marketplace, or
       ``(ii) minor modifications made to meet Federal Government 
     requirements,

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

     SEC. 7002. REGULATIONS ON ACQUISITION OF COMMERCIAL ITEMS.

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

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

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

             ``CHAPTER 136--PROCUREMENT OF COMMERCIAL ITEMS

``Sec.
``2281. Definitions.
``2282. Preference for acquisition of commercial items.
``2283. Exception to cost or pricing data requirement for commercial 
              items.
``2284. Principle of construction with future laws.
``2285. Inapplicability of certain provisions of law.''.

       (b) Clerical Amendment.--The tables of chapters at the 
     beginning of subtitle A of title 10, United States Code, and 
     the beginning of part IV of such subtitle are amended by 
     inserting before the item relating to chapter 137 the 
     following new item:

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

     SEC. 7102. DEFINITIONS.

       Chapter 136 of title 10, United States Code, as added by 
     section 7001, is amended by adding after the table of 
     sections the following:

     ``Sec. 2281. Definitions

       ``In this chapter:
       ``(1) The terms `commercial item', `nondevelopmental item', 
     `component', and `commercial component' have the meanings 
     provided in section 4 of the Office of Federal Procurement 
     Policy Act.
       ``(2) The term `head of an agency' means the Secretary of 
     Defense, the Secretary of Transportation, and the 
     Administrator of the National Aeronautics and Space 
     Administration.
       ``(3) The term `agency' means the Department of Defense, 
     the Coast Guard, and the National Aeronautics and Space 
     Administration.''.

     SEC. 7103. PREFERENCE FOR ACQUISITION OF COMMERCIAL ITEMS.

       (a) In General.--Chapter 136 of title 10, United States 
     Code, as amended by section 7102, is further amended by 
     adding after section 2281 the following new section:

     ``Sec. 2282. Preference for acquisition of commercial items

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

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

       (a) In General.--Chapter 136 of title 10, United States 
     Code, as amended by section 7103, is further amended by 
     adding after section 2282 the following new section:

     ``Sec. 2283. Exception to cost or pricing data requirements 
       for commercial items

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

     SEC. 7105. PRINCIPLE OF CONSTRUCTION WITH FUTURE LAWS.

       Chapter 136 of title 10, United States Code, as amended by 
     section 7104, is further amended by adding after section 2283 
     the following new section:

     ``Sec. 2284. Principle of construction with future laws

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

     SEC. 7106. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

       (a) Inapplicable Provisions.--Chapter 136 of title 10, 
     United States Code, as amended by section 7105, is further 
     amended by adding after section 2284 the following new 
     section:

     ``Sec. 2285. Inapplicability of certain provisions of law

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

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

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

     SEC. 7201. DEFINITIONS.

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

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

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

     SEC. 7202. PREFERENCE FOR ACQUISITION OF COMMERCIAL ITEMS.

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

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

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

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

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

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

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

     SEC. 7204. PRINCIPLE OF CONSTRUCTION WITH FUTURE LAWS.

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

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

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

     SEC. 7205. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

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

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

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

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

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

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

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

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

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

     SEC. 7303. ADDITIONAL RESPONSIBILITIES FOR ADVOCATES FOR 
                   COMPETITION.

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

     SEC. 7304. PROVISIONS NOT AFFECTED.

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

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

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

     SEC. 8001. TEST PROGRAM.

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

       (I) Any aircraft that is of a type customarily used in the 
     course of normal business operations for other than Federal 
     Government purposes, that has been issued a type certificate 
     by the Administrator of the Federal Aviation Administration, 
     and that has been sold or leased for use in the commercial 
     marketplace or that has been offered for sale or lease for 
     use in the commercial marketplace.
       (II) Any aircraft that, but for modifications of a type 
     customarily available in the commercial marketplace, or minor 
     modifications made to meet Federal Government requirements, 
     would satisfy the criteria in subclause (I).

       (D) Commercial-derivative engine.--The commercial 
     derivative engine program with respect to all contracts 
     directly related to the acquisition of (i) commercially 
     derived engines (including spare engines), logistics support 
     equipment, technical orders, management data, and initial 
     spare parts for use in supporting the purchase of commercial-
     derivative aircraft to meet future Air Force airlift and 
     tanker requirements, including engine replacement and 
     upgrades.
       (2) Conduct of defense acquisition programs.--In the case 
     of each defense acquisition program designated under 
     paragraph (1) for participation in the Defense Acquisition 
     Pilot Program, the Secretary of Defense shall--
       (A) develop guidelines and procedures for carrying out the 
     program and the criteria to be used in measuring the success 
     of the program;
       (B) evaluate the potential costs and benefits which may be 
     derived from the innovative procurement methods and 
     procedures tested under the program; and
       (C) develop the methods to be used to analyze the results 
     of the program.
       (3) Special authority.--The authority delegated under 
     paragraph (1) may include authority for the Secretary of 
     Defense--
       (A) to apply any amendment or repeal of a provision of law 
     made in this Act to the pilot programs before the effective 
     date of such amendment or repeal; and
       (B) to apply to a procurement of noncommercial items under 
     such programs--
       (i) any authority provided in such Act (or in an amendment 
     made by a provision of such Act) to waive a provision of law 
     in the case of commercial items, and
       (ii) any exception applicable under such Act (or an 
     amendment made by a provision of such Act) in the case of 
     commercial items,
     before the effective date of such provision (or amendment) to 
     the extent that the Secretary determines necessary to test 
     the application of such waiver or exception to procurements 
     of noncommercial items.
       (4) Applicability.--(A) Paragraph (3) applies with respect 
     to--
       (i) a contract that is awarded or modified during the 
     period described in subparagraph (B); and
       (ii) a contract that is awarded before the beginning of 
     such period and is to be performed (or may be performed), in 
     whole or in part, during such period.
       (B) The period referred to in subparagraph (A) is the 
     period that begins 45 days after the date of the enactment of 
     this Act and ends on September 30, 1998.

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

       (a) Study.--The Administrator for Federal Procurement 
     Policy shall conduct a study of--
       (1) the degree of participation by small businesses owned 
     and controlled by socially and economically disadvantaged 
     individuals in procurements conducted by executive agencies, 
     other than agencies in the Department of Defense; and
       (2) the extent of compliance by those executive agencies 
     with the goals for participation by such businesses required 
     by Office of Federal Procurement Policy policy letter 91-1, 
     relating to Government-wide small business and small 
     disadvantaged business goals for procurement contracts.
       (b) Report.--Not later than 6 months after the date of the 
     enactment of this Act, the Administrator for Federal 
     Procurement Policy shall submit a report on the study 
     required under subsection (a) to the Committee on Government 
     Operations and the Committee on Small Business of the House 
     of Representatives, and to the Committee on Governmental 
     Affairs and the Committee on Small Business of the Senate. 
     The report shall include recommendations to facilitate the 
     provision of authority to executive agencies, other than 
     agencies in the Department of Defense, to conduct procurement 
     set asides for small businesses owned and controlled by 
     socially and economically disadvantaged individuals, and on 
     improved outreach programs to increase the participation by 
     such businesses in procurements conducted by those executive 
     agencies.

     ``Sec. 2323. Contract goal for small disadvantaged businesses 
       and certain institutions of higher education

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

     SEC. 8004. EDUCATION AND TRAINING.

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

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

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

     SEC. 8006. SENSE OF CONGRESS ON NEGOTIATED RULEMAKING.

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

     SEC. 8007. VENDOR AND EMPLOYEE EXCELLENCE AWARDS.

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

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

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

     SEC. 8009. TECHNICAL AND CLERICAL AMENDMENTS.

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

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

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

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

       (2) Federal property and administrative services act of 
     1949.--The first section of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 471 et seq.) 
     is amended to read as follows:

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

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

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

                        ``TITLE I--ORGANIZATION

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

                    ``TITLE II--PROPERTY MANAGEMENT

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

                   ``TITLE III--PROCUREMENT PROCEDURE

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

                  ``TITLE IV--FOREIGN EXCESS PROPERTY

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

                     ``TITLE VI--GENERAL PROVISIONS

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

                  ``TITLE VIII--URBAN LAND UTILIZATION

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

           ``TITLE IX--SELECTION OF ARCHITECTS AND ENGINEERS

``Sec. 901.  Definitions.
``Sec. 902.  Policy.
``Sec. 903.  Requests for data on architectural and engineering 
              services.
``Sec. 904.  Negotiation of contracts for architectural and engineering 
              services.
``Sec. 905.  Short title.''.

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

     ``SEC. 905. SHORT TITLE.

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


                             ``short title

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

               TITLE IX--EFFECTIVE DATES AND REGULATIONS

     SEC. 9001. EFFECTIVE DATES.

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

     SEC. 9002. REGULATIONS.

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

     SEC. 9003. EVALUATION BY THE COMPTROLLER GENERAL.

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

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Michigan [Mr. Conyers] will be recognized for 20 minutes, and the 
gentleman from Pennsylvania [Mr. Clinger] will be recognized for 20 
minutes.
  The Chair recognizes the gentleman from Michigan [Mr. Conyers].
  Mr. CONYERS. Mr. Speaker, I yield myself such time as I may consume.
  (Mr. CONYERS asked and was given permission to revise and extend his 
remarks.)
  Mr. CONYERS. Mr. Speaker, today the House takes up consideration of 
H.R. 2238, the Federal Acquisition Improvement Act of 1994. This bill 
makes sweeping reforms to the Federal procurement system. Reforms that 
will make it easier for businesses, large and small, to work with the 
Government. And, reforms that will ultimately allow the Government to 
deliver services more professionally. It is the boldest modern-day 
attempt to revolutionize how the Government does business by greatly 
streamlining and simplifying its buying practices.
  The Federal procurement system--including the way it is implemented--
touches on every aspect of government. It affects the price agencies 
pay for the items they need to carry out their missions. It affects 
whether the Department of Defense has the right equipment on hand at 
the right time. And, it affects whether agencies are able to properly 
serve the taxpayers. With over $200 billion flowing through the 
procurement system each year, it is imperative that we make every 
effort to eliminate the inefficiencies that frustrate the business of 
government and waste the taxpayers' money. H.R. 2238 will make these 
needed reforms a reality.
  I am equally proud of the fact that H.R. 2238 makes these reforms 
without undermining key features of the current procurement statutes 
that protect the taxpayers. These features, such as full and open 
competition, help drive down costs. They help ensure that the 
taxpayers' dollar is spent, not on the basis of favoritism, but on the 
basis of fairness. They also allow small businesses to compete against 
large corporations--which is vital to the Nation's economy.
  From the very start, our goal has been to simplify and streamline the 
process, while strengthening the principles that help keep government 
business dealings honest and above board. I am convinced that we have 
succeeded on both fronts.
  Mr. Speaker, over the past several years the Committee on Government 
Operations has been a champion of the need for procurement reform. In 
the last Congress, the committee's procurement bill, H.R. 3161, passed 
the House in the final days of the session. Unfortunately, the Senate 
was unable to take up consideration of the bill in time to secure its 
final passage. It is gratifying, just the same, to see how much of that 
bill was ultimately adopted by the Senate and the Vice President's 
National Performance Review. H.R. 2238, the bill before us today, 
builds upon the committee's earlier efforts and is an unprecedented 
reform proposal.
  Members of the Government Operations Committee and the staff have 
invested countless hours in the crafting of this bill. They have worked 
in a truly bipartisan spirit of cooperation. Our esteemed colleague 
from Pennsylvania and the ranking minority member on the committee, 
Representative Bill Clinger, deserves special praise for all that he 
has done to make this effort succeed. His counsel has been invaluable 
and his dedication is very much appreciated.
  We have worked closely with Chairman Dellums, and other members of 
the Armed Services Committee, to reform those portions of the 
procurement system that affect the Defense Establishment. We have 
worked with other interested Members of the House, and we have worked 
closely with our colleagues in the Senate--who earlier this month voted 
overwhelmingly in favor of S. 1587, the companion bill to H.R. 2238. We 
have worked closely with the administration which has made procurement 
reform a centerpiece in its effort to reinvent the way government does 
business. We have held hearings. We have met with representatives from 
Fortune 500 companies, small businesses, Federal agencies, and others 
who know first hand the many virtues and pitfalls of the current 
procurement system.
  The result of this investment is apparent. H.R. 2238 enjoys 
bipartisan support from members of the Government Operations Committee, 
members of the Armed Services Committee, and many other Members of the 
House. The bill is supported by businesses throughout the country. And, 
it enjoys the full support of the administration.
  In fact, President Clinton and Vice President Gore deserve an 
enormous amount of credit for the leadership they have shown. They have 
not only made Federal procurement reform a national priority through 
the National Performance Review, they have also taken action where they 
can. For example, President Clinton has directed executive agencies to 
transform the current procurement system from one that is based on 
mountains of paper, to one that is automated, efficient, and more 
accessible to all businesses. H.R. 2238 provides incentives for 
agencies to complete this promising initiative without delay.
  The bill contains many provisions that are equally important and 
promising. For example, the bill would:
  Encourage agencies to buy commercial goods and services--a measure 
that will eliminate redtape and lower costs;
  Establish a simplified acquisition threshold at $100,000--
streamlining thousands of contract actions; and
  Authorize test programs that lay the groundwork for future innovative 
reforms to the procurement system.

                              {time}  1300

  We are delighted that this measure is now at the stage where it is 
ready to come before the full House for its final ratification.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CLINGER. Mr. Speaker, I yield myself such time as I may consume.
  (Mr. CLINGER asked and was given permission to revise and extend his 
remarks.)
  Mr. CLINGER. Mr. Speaker, I rise in very strong support of the 
Federal Acquisition Improvement Act of 1994. It is also true that I had 
hoped we might have been able to delay consideration of this measure 
perhaps until tomorrow because of a matter that is still under 
discussion between the majority and the minority of the Committee on 
Armed Services. However, I am advised that there could be no guarantee 
that we would be able to consider this bill on suspension tomorrow. 
However, I am also advised that the matter is still in dispute or 
discussion between the majority and minority on the Armed Services 
Committee and would not be such that would cause Mr. Spence, the 
ranking member on the Armed Services Committee to vote against this 
legislation. I also regret he is not able to be here because of a 
scheduling conflict, to be here to participate in this debate, which is 
another reason I would have liked to have had this matter postponed 
until a time that Mr. Spence might be able to be here.
  But I do understand the majority leadership wants to proceed with 
this matter, and I think indeed this is a matter that does need to be 
proceeded with. It is, frankly, overdue. I am referring to the glaring 
problems that we have had with the Federal procurement legislation. The 
legislation makes very significant improvements in a very complicated 
area, Federal procurement. Reforming the Federal procurement system is 
an extremely difficult and complex task because the procurement process 
is itself arcanely difficult and complex.
  Nevertheless, this is an issue of prime importance to both American 
business and the American taxpayer.
  The bill which we are considering today has been developed over a 
long period of time, as Chairman Conyers indicated, over a long period 
of time and represents the coordinated efforts of the majority and 
minority of both the Government Operations Committee and the Armed 
Services Committee. It represents a balance of interests, I think, of 
both committees, and it does so in a bipartisan way. That was perhaps 
something we do not often see in this body to have that cooperation 
between two committees and between the majorities and minorities on 
both committees.
  The bill builds upon H.R. 3161, which was approved by the House 
during the 102d Congress but was never passed by the other side of the 
Capitol. I commend and congratulate Chairman Conyers for his relentless 
commitment to the matter of procurement reform and his dedication to 
pursuing this to its enactment, which I am confident is going to happen 
today. He has been the driving, leading force in this whole effort for 
many years.
  The Federal Government spends approximately $200 billion a year on 
the procurement of goods and services. Despite this huge expenditure of 
money, the current procurement system remains complicated, confusing, 
and mind-boggling, frankly. It is burdened with an outmoded and 
fragmented statutory foundation and is encumbered by regulatory and 
procedural proliferation beyond comprehension. These burdens limit the 
Government's buying power, limit the pool of potential suppliers, 
including small businesses, by deterring thousands of firms from doing 
business with the Government, and jeopardize the financial health of 
those firms who are willing, in fact, to contract with the United 
States. And that number, frankly, is diminishing all the time because 
of the great complexity of the system. The time is now to overhaul the 
current system and greatly simplify and streamline it, goals which I 
think we have met in this legislation. The bill reflects many of the 
recommendations of the section 800 panel, a congressionally mandated 
panel of industry and Government officials charged with developing 
recommendations to streamline and simplify the procurement system. 
Consistent with the administration's National Performance Review, this 
bill contains many reforms advocated for years to enable the Government 
to act more like a business in the way that it buys its goods and 
services.
  Mr. Speaker, as a cornerstone to this legislation is an emphasis on 
commercial product acquisition. The idea that the Government could 
benefit from broader use of commercial products has been discussed for 
many years. Numerous commissions, panels, and studies dating back more 
than 20 years, frankly, have recommended that Federal policies be 
revised to improve agencies' ability to buy off-the-shelf products. 
Cost savings, shortened delivery time, and improved access to privately 
developed advanced technology have been cited as the expected benefits 
from expanded procurement of commercial items. H.R. 2238 makes several 
amendments to Federal procurement law to encourage the purchase of 
commercial items by the Federal Government. This is perhaps the 
keystone of this legislation. It truly is the key to everything else 
that we accomplish. If we did nothing more than this, we would have 
made an enormous stride in reforming our procurement system.

                              {time}  1310

  But the bill also addresses certain problems faced every day by 
Government buyers and companies who sell goods and services to these 
buyers. Among other things, the bill first reduces paperwork burdens on 
the industry, something that we always talk about but rarely do. 
Second, it simplifies the acquisition process for contracts under 
$100,000, which are now subject to a thicket of antiquated and some 
redundant overlapping requirements in regulations. Third, it improves 
communication between Government buyers and industry sellers. There has 
been a whole range of suspicion that has grown up between those trying 
to sell to the Government and those doing the buying because of the 
lack of an ability to communicate. It strengthens the bid protest 
remedy process for contractors who believe they have been unfairly 
eliminated from contracts. And finally it provides pilot program test 
authority for certain agencies for alternative and innovative 
procurement procedures, and among those agencies would be the Federal 
Aviation Administration about which there has been much controversy 
about the procurement procedures followed in that agency.
  Mr. Speaker, when we talk about Federal procurement reform as a 
subject, people's eyes tend to glaze over. It is a very arcane subject. 
It is not something that grabs people's attention. However when we talk 
about the $100 hammer, the $800 coffee urn, the $300 toilet seats, et 
cetera, that tends to focus the American taxpayer's attention very 
dramatically, and that is really what this bill is all about. We are 
trying to eliminate those stories that we have seen too often in the 
press and television talking about the waste and so forth.
  Mr. Speaker, procurement reform is long overdue. The American 
taxpayers deserve and should demand a procurement system that does not 
add costs without adding value, does not impede the Government's access 
to state of the art technology and does not force businesses to alter 
standard procedures and raise prices when dealing with the Government.
  Mr. Speaker, will passage of this bill eliminate all waste, fraud and 
abuse in Government procurement? Of course not. This is a human 
institution, and we are never going to eliminate waste, fraud and abuse 
entirely. But will it dramatically reduce the amount of waste, fraud 
and abuse that we see in the present system and result in enormous 
savings, enormous savings into the billions of dollars over the years 
that lie ahead? I think the answer to that is a resounding yes. Is it a 
perfect bill? No; it is not a perfect bill. Certainly, I think, all of 
us would have problems with some part or another of it. I would have 
preferred to have seen a provision dealing with recoupment, which is 
making us less competitive in terms of world markets for foreign 
military sales. I think there are some items the chairman alluded to 
with regard to small business access to Federal procurement that we 
would have liked to have seen included and, perhaps, can be addressed 
later. So, it is not a perfect bill. It is not one that we totally 
agree on.
  Mr. Speaker, the point is that we all do agree on the essential 
building blocks which this bill contains, and I would just extend my 
congratulations again to the gentleman from Michigan [Mr. Conyers] and 
to the gentleman from California [Mr. Dellums] who has been very 
cooperative throughout this entire process and has worked very hard to 
bring us to this day. Then there is the gentleman from South Carolina 
[Mr. Spence] who has been my counterpart on the Committee on Armed 
Services who has also played a very constructive role in this effort, 
and I think that we owe enormous thanks to the staff members, Julian 
Epstein, and Matt Fletcher, and particularly, particularly to Chuck 
Wheeler and Ellen Brown who have literally devoted I do not know how 
many hours; I mean its been a lifetime, I am sure that they would feel 
it has been; in bringing us to this conclusion and, hopefully, closure 
on this matter today.
  So, Mr. Speaker, I support this legislation because it goes a long 
way toward making the Federal procurement system work better, work 
smarter and just plain work, and I urge Members to vote to adopt H.R. 
2238, and I reserve the balance of my time.
  Mr. CONYERS. Mr. Speaker, I am delighted to yield 8 minutes to the 
chairman of the Committee on Armed Services, the gentleman from 
California [Mr. Dellums], and might I say that he and his stall have 
been indefatigable in their efforts to close all of the loops that have 
occurred in a reform acquisition bill that deals with agency-specific 
procurement activities and Governmentwide procurement activities; they 
make a very confusing mix, and I am honored to hear from my colleagues 
at this point.
  (Mr. DELLUMS asked and was given permission to revise and extend his 
remarks.)
  Mr. DELLUMS. Mr. Speaker, I thank the gentleman from Michigan [Mr. 
Conyers], and might I first begin by thanking the distinguished 
chairman of the Committee on Government Operations and the 
distinguished gentleman from Pennsylvania [Mr. Clinger], the ranking 
minority member, for their generous and very kind remarks.
  Mr. Speaker, I rise in support of H.R. 2238, the Federal Acquisition 
Improvement Act of 1994. This bill, which streamlines and reforms the 
costly Federal procurement system, is the result of an extensive 
bipartisan, and I underscore ``bipartisan,'' joint committee effort 
between the Committee on Armed Services and the Committee on Government 
Operations. My partners in this effort, the gentleman from Michigan 
[Mr. Conyers], the gentleman from South Carolina [Mr. Spence], the 
gentleman from Pennsylvania [Mr. Clinger], the ranking minority members 
of the Committee on Armed Services and the Committee on Government 
Operations respectively, deserve tremendous credit, Mr. Speaker, for 
the work they have put into this bill and certainly for their 
perseverance in keeping us all on track.
  Mr. Speaker, in drafting H.R. 2238, we had numerous discussions with 
the Department of Defense and other administration officials, as well 
as with representatives of large and small firms. I think it is fair to 
say that our efforts have met with support from these groups.
  At any time, reducing the cost of doing business is a good thing. 
Indeed, we have talked about it for decades--dating all the way back to 
the Hoover Commission up to the Defense Management Review and the 
recent Section 800 Report. Now, declining budgets have made this a 
fiscal imperative.
  Acquisition reform is particularly critical to the defense sector, 
especially since reductions in defense spending are causing the 
contraction of the defense industrial base. The cost of maintaining a 
dedicated defense industrial sector is an increasingly difficult 
challenge.
  I do not believe this problem can be solved without meaningful 
acquisition reform. For the current defense industrial base, reform 
could be the right medicine for helping the defense industry 
streamline, diversify--and stay in business. And at the same time, 
other companies, long wary of the complexities of Government 
contracting, will be afforded new opportunities to participate in the 
Government market.

  Acquisition reform will also help the Defense Department afford the 
technologies and manpower to carry it into the 21st century.
  Indeed, as Defense Secretary Perry has testified, and I quote:

       Acquisition reform shares a common border with most of our 
     national goals, saving the taxpayer money, reinventing 
     government, strengthening our military and improving our 
     economy.

  Unfortunately, the Federal acquisition system we have inherited will 
not permit this. The complex and cumbersome maze of laws and 
regulations make it increasingly difficult for Federal personnel to 
exercise prudent discretion and good business judgment. Furthermore, 
because these burdens impact small business they limit the Government's 
buying power, limit the pool of potential suppliers by deterring 
thousands of firms from doing business with the Government, and 
jeopardize the financial health of those who are willing to contract 
with the United States.
  This bill puts more responsibility into the system to do the right 
thing by the taxpayer. Contracting officials currently are 
straitjacketed by rules and regulations that have given us such things 
as $600 hammers. The existing rules and regulations have worked against 
using common sense or good old Yankee ingenuity to solve the problem 
and get the best item for the taxpayer.
  H.R. 2238 removes many of the legal barriers that have kept many 
companies out of the Government sector. This should lower the cost of a 
significant portion of the Pentagon's procurements while retaining 
current and necessary highly regulated acquisition procedures for those 
defense-unique items that will continue to require careful Government 
management and oversight.
  H.R. 2238 represents the most comprehensive Governmentwide 
acquisition reform in over a decade. The principal objective behind 
this legislation is to strike a more equitable balance between the 
multitude of Government-unique policy requirements imposed on Federal 
procurement and the need to lower the Government's cost of doing 
business, and save the taxpayer money. H.R. 2238 will accomplish this 
objective by increasing our reliance on the use of commercial 
practices, goods and services; by creating a new category of high-
volume, low-value Federal procurements that can be accomplished with 
streamlined rules and regulations; and by improving access to 
contracting opportunities for small business and minority-owned small 
businesses.
  Facilitating the procurement of commercial products and services is 
perhaps the single most important issue to be addressed in acquisition 
reform. It was, therefore, a major focus of our efforts.
  Commercial companies have found it difficult to serve a Government 
customer because of the complex web of Government procurement 
requirements--requirements for cost data and other financial 
information, Government unique terms and conditions, Government audit 
rights, and unlimited Government rights to technical and proprietary 
data. Such practices are uncommon, or nonexistent, in the commercial 
marketplace.
  Congressional direction to acquire commercial products dates back to 
the enactment of the Competition in Contracting Act of 1984. The 
Congress, through various Defense authorization acts, has also provided 
authority specifically to the Department of Defense to increase the use 
of commercial products or nondevelopmental items where such items would 
meet the Department's needs. This authority, however, has never been 
widely used.
  The Defense Department must move away from its reliance on buying 
defense-unique items, using defense-unique specification, and using 
defense-unique contract terms and conditions. It must move toward 
operating like a world class commercial customer where possible.
  Title VII or H.R. 2238 is aimed at facilitating greater use of 
commercial items and services. This section is based on the premise 
that the forces of the commercial marketplace may be relied upon as 
much by the Federal Government as they are by all of us when we spend 
our money--to ensure that product quality meets our requirements and 
that the prices and terms are fair and reasonable.
  The preference for commercial products and services should help 
smaller companies as well. Small firms in particular are hurt by the 
problems that flow from the Government's use of detailed design 
specifications, many of which are substantially outdated or call for 
components no longer available in the marketplace.
  Title IV of H.R. 2238 would raise the threshold from $25,000 to 
$100,000 for agency use of simplified contracting procedures. H.R. 2238 
would link this new simplified acquisition threshold to having an 
electronic notice capability in place, through a Federal acquisition 
computer network capability. Our intent is to push the Federal 
Government toward embracing the use of electronic commerce as a primary 
means of simplifying the procurement process and ensuring greater 
contracting opportunities for small businesses.
  I must stress that I firmly believe these electronic commerce 
provisions in H.R. 2238 complement the ongoing efforts by the 
administration, which resulted from the President's October Executive 
order to transform the acquisition process from a paper-based 
acquisition system to an electronic one.

  Further, I am pleased that the administration has recognized the need 
to extend the Defense Department's Minority Contracting Goal Program--
commonly called the section 1207 program--to all Government agencies; 
this is an idea whose time is long overdue. However, because of 
objections from the Small Business Committee we could not include this 
very necessary provision in the bill.
  This is unfortunate because civilian agencies are struggling to meet 
their minority business contracting goals. The Small Business Act 
establishes a 5-percent Governmentwide contracting goal for small 
disadvantaged businesses. And separate, higher goals have been 
established by Congress for several Government agencies. But civilian 
agencies have pointed out that reaching these goals is difficult 
because they do not have any of the tools provided to the Department of 
Defense under the section 1207 program--the ability to set aside 
contracts or pay a price differential. I believe that if the civilian 
agencies had these same tools they could improve their contracting with 
small disadvantaged businesses.
  In closing, I lay down a challenge to the administration. Congress is 
stepping up to the plate and doing its part to reform the acquisition 
system. But much more can be done--and most of that can be done by the 
administration. I challenge the administration, and particularly the 
Department of Defense, to tackle its own rules and regulations, and to 
push for cultural acceptance among its workers. Without this, what we 
do here today will be for nought.
  Mr. Speaker, H.R. 2238 is a significant contribution to acquisition 
reform. I urge my colleagues to support H.R. 2238.

                              {time}  1320

  Mr. CLINGER. Mr. Speaker, I have no requests for time at the moment, 
and I reserve the balance of my time.
  Mr. CONYERS. Mr. Speaker, I yield 1 minute to the distinguished 
chairman of the Committee on Energy and Commerce, the gentleman from 
Michigan [Mr. Dingell].
  (Mr. DINGELL asked and was given permission to revise and extend his 
remarks.)
  Mr. DINGELL. Mr. Speaker, I especially want to commend the chairman 
of the Committee on Government Operations, Representative John Conyers, 
who has been tenacious in seeking reform in Government contracting. 
H.R. 2238 is a monument to his efforts. It has been a pleasure to work 
with him and the ranking Republican, Mr. Clinger. And I also want to 
commend my friend, the chairman of the Armed Services Committee, Mr. 
Dellums of California, for his true leadership.
  Section 2152 of H.R. 2238 will prevent Government contractors from 
billing the taxpayer for entertainment, gifts, and recreation for 
employee morale.
  Our Subcommittee on Oversight and Investigations has compiled a long 
list of contractor abuses. One firm billed more than $2,100 for a 
hospitality suite and golf tournament at the infamous Tailhook 
Convention. Another billed more than $5,500 for retirement gifts for 
watches, pearls, and grandfather clocks. A third billed more than 
$19,600 for entertainment for photographers, a dance band, and even a 
reindeer suit for a Christmas party.
  I believe contractors should provide for employee morale at their 
expense, not at the expense of the taxpayer.
  I urge support for H.R. 2238.
  Mr. DINGELL. Mr. Speaker, let me provide more details.


                  entertainment, gifts, and recreation

  For years, hearings of the Subcommittee on Oversight and 
Investigations have documented outrageous charges to the Federal 
Government for contractor entertainment, gifts, and recreation. Our 
earliest work on these issues started in 1985 with a hearing on General 
Dynamics Corp., then the No. 1 defense contractor. We learned that the 
senior vice president of General Dynamics had gone on a retreat with 
other company executives from around the country to an island off the 
coast of South Carolina to play golf. They not only stayed in luxury, 
but they provided for the boarding of the executive's dog, all at 
taxpayer's expense.
  Since that time, we have held scores of additional hearings and 
documented abuses at other Federal agencies, including the Department 
of Energy [DOE] and the Environmental Protection Agency [EPA]. A 1992 
hearing on an OMB review of 12 major civilian agencies further 
confirmed a pattern of abuse.
  Let me cite just a few of the more recent abuses we have learned 
about:
  In March 1992, the General Accounting Office [GAO] questioned 
$167,000 for contractor employee parties and picnics claimed in 1990 by 
CH2M Hill, one the EPA's largest contractors. The amounts claimed 
included $19,600 for entertainment, $300 for party invitations, $850 
for photographers, $100 for a dance instructor, $3,200 for a dance 
band, and even a reindeer suit for a Christmas party. The GAO review 
also disclosed extensive charges for employee recreation and gifts, 
including among other things, softball, baseball, basketball, soccer, 
bowling, and volleyball teams and equipment, and fees for ski racing 
and golf.
  Another review completed by GAO in 1993 of EPA contractors revealed 
billings by Arthur D. Little, Inc., of $5,550 for retirement gifts, 
including among other things, pearls costing $467, two watches costing 
$1,466, and four grandfather clocks costing $2,815 including delivery 
and installation. Another EPA contractor had charged $4,379 for sports-
related expenses, including season tickets to baseball, football, and 
basketball teams and payments for golf tournaments.
  An October 13, 1993, hearing on overhead abuses by McDonnell Douglas 
disclosed that in 1 year alone the company had billed the Government 
$115,000 for employee recreation clubs, including the Beer Can 
Collectors Club, the Rockhound Club, and the Saddle Club. The GAO's 
hearing testimony also indicated that the company had charged $14,500 
for entertainment, including $2,184 for a hospitality suite at the 
Tailhook Convention and charges for a golf tournament at the Tailhook 
Convention.
  I believe that the legislation before us should be implemented to 
halt these types of abuses. Contractors have relied repeatedly on the 
employee morale loophole in the current procurement regulations to 
justify such outlandish charges for entertainment, gifts, and 
recreation by employees and their families. I have no objection to 
contractors providing for the morale of their employees at no cost to 
the taxpayer. It is simply time for the taxpayer to stop footing the 
bill.

  Most taxpayers would be astonished to learn that tax dollars that 
were earmarked for environmental protection were financing a swimming 
pool or retirement gifts for EPA contractor employees or that tax 
dollars for the defense of our Nation were being funneled to pay for 
the Beer Can Collectors Club at McDonnell Douglas. It is time for real 
reform.
  The bill provides that such costs are unallowable unless the FAR 
Council can clearly show that some such costs, in the case of gifts and 
recreation, but not entertainment, should be allowable. The bill 
establishes the presumption against allowability. The Subcommittee on 
Oversight and Investigations will be overseeing how and if the Council 
uses this limited exception.


 penalties for improperly claimed costs under civilian agency contracts

  We must not only tighten the regulations governing unallowable costs 
but we also must increase the incentives for complying with these 
regulations. This legislation does so by extending to civilian agencies 
important new authority which should help deter the charging of 
unallowable costs. The bill would allow civilian agencies for the first 
time to assess penalties against contractors for including unallowable 
costs in billings submitted to the Government. To date, this authority 
only has been available to the Department of Defense [DOD].
  Hearings by our Subcommittee on Oversight and Investigations have 
documented a catch-me-if-you-can attitude by Federal agency contractors 
in their billing of various unallowable costs, such as alcoholic 
beverages and lobbying activities. Knowing that auditors cannot review 
every item, some contractors rename unallowables and scatter them 
throughout their accounting system taking the chance that they will not 
be discovered. When these costs slip through, the taxpayer foots the 
bill. This situation must be changed, and this legislation takes an 
important step in doing so. However, the legislation must be vigorously 
enforced to achieve its full potential.
  This legislative proposal was a direct outcome of our subcommittee's 
work. In response to subcommittee hearings in 1992 highlighting 
contract management problems at the EPA, the Office of Management and 
Budget [OMB] launched an interagency SWAT team to examine and assess 
the contract administration and audit practices of 12 civilian 
agencies. The penalty authority proposal was one of the major 
recommendations of the SWAT team effort, and this proposal was 
presented to the subcommittee in testimony by OMB officials in December 
1992.
  Mr. Speaker, these provisions are similar to those adopted by the 
Committee on Government Operations in connection with H.R. 3425, the 
Department of Environmental Protection Act legislation (see H. Rept. 
103-355, November 10, 1993).
  I strongly urge support for this bill.
  Mr. CONYERS. Mr. Speaker, I am delighted to yield 2 minutes to the 
distinguished gentleman from Oklahoma [Mr. Synar], a member of the 
Committee on Government Operations.
  (Mr. SYNAR asked and was given permission to revise and extend his 
remarks.)
  Mr. SYNAR. Mr. Speaker, I rise in support H.R. 2238, the Federal 
Acquisition and Improvement Act of 1994. Among other things, this 
legislation will reform the way the Federal Government currently 
reimburses its contractors for cost related to so-called employee 
morale and welfare. Investigations by my Subcommittee on Environment, 
Energy and Natural Resources in April 1992, as well as those of the 
House Committee on Energy and Commerce, demonstrated that Government 
contractors have routinely engaged in high questionable billing 
practices which have resulted in millions of Federal tax dollars going 
toward things like lavish Christmas parties, limousine travel, and 
expensive retirement gifts for contractors employees and their spouses, 
rather than toward cleanup of our Nation's Superfund sites. What is 
worse is that many of these expenses are currently deemed allowable 
under Federal procurement guidelines as indirect contractor costs for 
entertainment, gifts and recreation to maintain employee morale.
  Let me highlight just a few of the things we found that Federal tax 
dollars helped pay for at three EPA Superfund contractors--Bechtel, ICF 
Inc., and Roy F. Weston: Rolex watches and tiffany clocks as retirement 
gifts for Bechtel contractor employees and their spouses; Masters Golf 
Tournament tickets and private club dues for Bechtel executives; a 
$115,000 corporate Christmas party for ICF, Inc.; tickets to Baltimore 
Orioles games and to Disneyland for ICF employees; $10,000 for 
settlement of an EEOC claim against Roy F. Weston, Inc.; $650 for a 
fishing boat rental and $4,600 for ruby charms and sapphire tie tacs 
for Roy F. Weston employees.

  Mr. Speaker, these are not unique expenses charged to the Government 
by just these three EPA contractors. Auditors from the U.S. General 
Accounting Office [GAO] and the Defense Contract Audit Agency [DCAA] 
identified even more incredible contractor expenditures that were 
reimbursed in part by taxpayer dollars. For example, GAO found that 
CH2M Hill asked the Government to help pay the costs of contractor 
employee parties, including entertainment--and in one instance a 
reindeer suit. DCAA found that a contractor, Viar and Co., included the 
cost of employees renting the company president's beach house as an 
indirect expense to be reimbursed by the taxpayers. And the Energy and 
Commerce Committee has found numerous examples of similar contractor 
abuses in other Federal agencies.
  Mr. Speaker, contractors argue that reimbursement of expenses for 
contractor employee morale and welfare is an appropriate cost of doing 
business that is passed on to the customer--the Federal taxpayer. I 
strongly disagree. We are not talking about minor expenses for plaques 
or certificates of appreciation, or even for a staff volleyball league. 
Here we are talking about big-league bucks. If contractors want to give 
their employees Rolex watches as retirement gifts, fine. But do not try 
to pass part of that cost off to the taxpayers. I think it is clear 
from the examples I have given today that Government contractors have 
abused the provisions in the current law, and we have to put a stop to 
it.
  With this legislation, the House is sending a strong message to 
contractors that we will not tolerate millions of dollars of taxpayer 
money being spent on entertainment, gifts, and recreation for 
contractor employees. The bill eliminates altogether the loophole for 
contractor entertainment expenses, and prohibits reimbursement of 
contractor costs for gifts and recreation unless the Federal 
Acquisition Regulatory Council promulgates regulations governing such 
expenses within 6 months. Frankly, I think the evidence from our 
hearings show that all expenses for gifts and recreation should be 
completely unallowable. The American taxpayers should not pay for one 
penny of a contractor employee's Rolex watch or sapphire tie tac. I 
hope the FAR council remembers these examples and prohibits expenses 
for gifts and recreation in the regulations it is expected to issue.
  Finally, I want to note that the legislation also strengthens the 
current law by extending to non-Defense agencies new authority to 
assess penalties against contractors that include unallowable costs in 
their billings to the Government. The Defense Department has had this 
authority for some time, and it has worked as a strong incentive for 
companies to establish aggressive internal screening procedures to 
catch any errors. This provision is especially important because 
civilian agencies increasingly rely on contractor employee to 
accomplish their mission. Of course, strong enforcement and oversight 
efforts by the agencies and Congress must continue to ensure that 
taxpayers are not inadvertently paying for expressly unallowable costs.
  Mr. CLINGER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Michigan [Mr. Smith].
  Mr. SMITH of Michigan. Mr. Speaker, I wish to thank the ranking 
members and chairmen of both the Committee on Government Operations and 
the Committee on Armed Services for their efforts in developing Federal 
procurement reform legislation. It is exciting to get away from the 
bureaucracy as usual and start looking at how we can do a better job 
with the tremendous amount of taxpayer dollars we use and the way we 
purchase goods.
  The Federal Government spends $200 billion on procurement every 
year--$800 for every American. With 142,000 Federal employees to 
implement over 4,500 pages of Federal procurement regulations and 
agency supplements, the system has long needed an overhaul and this 
legislation is a step in the right direction.
  Mr. Speaker, I rise in support of H.R. 2238, the Federal Acquisition 
Improvement Act. As cochairman of the Bipartisan Freshman Procurement 
Task Force with the gentlewoman from New York [Mrs. Maloney], we and 
the freshmen class have worked hard in this area to expand the 
reinvention of the way the Government buys goods and services. We heard 
many concerns from suppliers of goods and services about the tremendous 
amount of bureaucracy they have to endure in order to offer a bid. This 
legislation will begin to allow more goods to be purchased off-the-
shelf without exceptional requirements. It will move the United States 
in the right direction.
  This bill will encourage commercial product acquisition, enhance 
competition and reduce paperwork, and simplify thousands of small 
purchases. Federal managers will be able to make purchases of up to 
$100,000 without having to review tedious regulations.
  While this bill is not perfect legislation, I think it moves this 
Government and this Congress in the direction of letting the American 
people know that we are making a decision to start reforming Government 
and making it more efficient.
  So, Mr. Speaker, I support the bill, and urge my colleagues, along 
with the members of the freshman class, Republicans and Democrats, to 
support this bill.

                              {time}  1330

  Mr. CONYERS. Mr. Speaker, I am pleased to yield 1 minute to the 
gentlewoman from the District of Columbia [Mrs. Norton].
  (Ms. NORTON asked and was given permission to revise and extend her 
remarks.)
  Ms. NORTON. Mr. Speaker, I want to thank the gentleman from Michigan, 
Chairman Conyers, and the gentleman from Pennsylvania [Mr. Clinger] for 
their excellent work on this bill, the Federal Acquisition Improvement 
Act, and the gentleman from California [Mr. Dellums] for his vital 
contribution.
  This act contains many reforms and innovations that clear the decks 
of excess bureaucratic baggage that makes the Government pay more for 
what it buys. I know Chairman Conyers is also interested in the other 
half of this problem--the half that deals with services.
  This act deals with goods. We buy more services than goods. The next 
step must be to reform the purchase of services. I have three bills 
that need the same attention we are now giving this bill.
  The GAO has found that agencies are actually paying more to contract 
out services in some instances than to do the work in-house. I have a 
bill that would require agencies to do a cost comparison before 
contracting out services.
  I have a bill that would have the OMB determine just how many 
taxpayer-paid contracting employees we have. There is a shadow 
government out there that we know little about.
  Finally, I have a bill prohibiting agencies from replacing bought-out 
Federal employees with contract employees.
  I support this bill, H.R. 2238, and look forward to moving on to the 
services part of this problem.
  Mr. BILBRAY. Mr. Chairman, I rise in strong support of H.R. 2238, the 
Federal Acquisition Improvement Act.
  First, I would like to commend the work of Chairman Dellums and 
Chairman Conyers. Despite the responsibilities that their two 
committees have had over the last year and a half, they have been able 
to give this legislation the priority and consideration it deserves.
  Second, I want to commend them for the sensitivity they have shown to 
the role of the small business community and the effect that this 
legislation would have on them.
  As chairman of the Subcommittee on Procurement, Taxation, and 
Tourism, of the Small Business Committee, my staff and myself have also 
spent the better part of the last year and half analyzing and 
discussing the impact this legislation would have on the small business 
community. Through countless negotiations sessions, and three hearings 
which my subcommittee has held, it has become clear to me that the 
product that we see before us today will not only simplify our 
cumbersome and inefficient procurement system but more importantly it 
will provide new and more dynamic business opportunities for small 
businesses.
  There have been a number of misconceptions surrounding the impact 
this bill will have on small businesses. Let me state, once and for 
all, this bill is good for small business.
  This legislation will ensure that small business gets access to 
contract opportunities--faster and more efficiently through the 
creation of an electronic commerce network. Second, it will increase 
the number of contracts available to small business by raising the 
small business reservation to $100,000. In addition, it will spread the 
benefits of programs such as the 1207, small business disadvantage 
program throughout the Government.
  Finally, it will allow the Government to enter the commercial 
marketplace, buy goods directly off the shelf, thereby removing the 
cumbersome requirements that have kept small businesses from 
participating in the Government procurement system.
  I want to take a moment to thank the staffs of both Armed Services 
and Government Operations Committees, Cathy Garman, Robert Rangel, 
Chuck Wheeler, and Ellen Brown for cooperating so fully and openly with 
my subcommittee staff.
  Again, I urge my colleagues to support this legislation and look 
forward to seeing this bill signed into law this year.
  Mr. SPENCE. Mr. Speaker, although this bill is not everything that it 
could and should be, it nevertheless is an initial step in the right 
direction of streamlining the laborious Federal procurement system. 
This bill will help to reduce the costs associated with doing business 
with the Government while maintaining standards of oversight necessary 
to protect the taxpayer's interests.
  Putting this bill together has been an arduous process that has often 
pitted committee versus committee and Republicans versus Democrats. 
But, despite the many worthwhile proposals contained in this bill, I am 
deeply disappointed that it has failed to address the important issue 
of R&D recoupment for foreign military sales, and I am disturbed by the 
process associated with the handling of this issue since the Armed 
Services Committee marked-up its acquisition reform bill back in April.
  Earlier this year, the administration proposed that the decades-old 
recoupment provision be stricken from the law. The draft Dellums-Spence 
Federal Acquisition Improvement Act of 1994, the basis for the House 
Armed Services Committee markup, struck the recoupment provision from 
the law. And, H.R. 4328, Mr. Conyers' and Mr. Clinger's acquisition 
reform bill likewise struck the recoupment provision from the law. Yet, 
the provision is not included in the bill before the House this 
afternoon.
  Addressing the recoupment issue is important to the Department of 
Defense and to the U.S. defense industrial base. Striking the existing 
recoupment statute would do nothing more than slightly increase the 
competitiveness of, and level the playing field for, the U.S. defense 
industry. We ought to be particularly sensitive to the defense 
industrial base since it continues to erode after 10 consecutive years 
of defense cuts and the prospect of even more severe cutbacks under 
President Clinton.
  According to the Bureau of Labor Statistics, the Clinton cuts will 
result in an average monthly loss in private sector defense-related 
jobs of 20,000 for the foreseeable future. U.S. aerospace companies 
have not employed so few workers since Jimmy Carter was President.
  Contrary to the arguments one may hear in opposition to striking the 
recoupment law: It would in no way undermine any arms control efforts 
or agreements; it would in no way encourage arms sales or the 
proliferation of conventional weapons; and it would in no way alter the 
existing and rigorous congressional oversight policies governing 
foreign military sales.
  Mr. Speaker, over the past 2 weeks I have been faced with the 
unenviable choice of ignoring an important issue and allowing this bill 
to proceed on the suspension calendar, or openly opposing the 
legislation and possibly derailing it under the two-thirds rule.
  While recoupment is an issue we should not hide from due to its 
importance to a declining defense industrial base, this bill, as a 
whole, is also important to industry. Mr. Speaker, under any 
circumstances my enthusiasm for this bill is not what it once was. 
Nonetheless, I do not believe that throwing this bill off-track is in 
the interest of industry and therefore, I do not plan to oppose it.
  Mr. Speaker, in closing I want to extend my thanks to Mr. Conyers and 
Mr. Clinger and to their staff for their efforts on this issue. We 
would not be here without their cooperation.
  Closer to home, I also want to thank Chairman Dellums and, in 
particular, Robert Rangel and Cathy Garman of the HASC staff for their 
months of hard work. Their dedication and effort on this bill has truly 
been above and beyond the call of duty.
  Mr. WELDON. Mr. Speaker, I rise in support of H.R. 2238, the Federal 
Acquisition Improvement Act. This far-reaching reform of Federal 
procurement laws is long overdue and instrumental to cost-cutting 
efforts.
  As we work to reduce Federal spending, neither the Government nor 
industry can afford the nonvalue added requirements which burden the 
Federal procurement system. These rules, regulations, and requirements 
unnecessarily add 20 to 50 percent to the cost of Federal purchases. 
Given the $200 billion that the Government spends annually, the 
elimination of these unnecessary costs is significant.
  Not only do we lose money by perpetuating the current system, but we 
limit Federal buying power and prevent many firms from doing business 
with the Government. Too often, companies which do sell commercially 
cannot afford to do business with the Government given all the unique 
paperwork and reporting requirements, and those who do a great deal of 
business with the Government miss commercial opportunities due to the 
many Government accounting and auditing requirements placed on 
Government contractors doing nonGovernment work.
  As a member of the Armed Services Committee, I have taken a special 
interest in acquisition reform. The defense budget has been cut each 
year since 1985, and our ability to meet our security needs is becoming 
increasingly difficult. If we want the military to do more with less, 
we must give them more flexibility in purchasing. It is time that we 
preserved more funds for systems acquisition, training, and personnel 
and spend less on the bureaucracy required to administer the complex 
web of procurement laws.
  We have set increasing number of laws to prevent waste, fraud, and 
abuse in our systems and to allegedly ensure the delivery of quality 
products. While these efforts were well-intended, they have not 
prevented all waste nor have they assured quality in every case. Added 
on incrementally over the years, they have resulted in a myriad of 
regulations and requirements, often working at cross purposes from one 
another. It is time to streamline the system, and set up a more orderly 
process by which to monitor Government programs and contractors.
  Last year, I offered amendments to the Defense authorization which 
form the basis for the measure before us today. My amendments would 
have required the Department of Defense to buy off-the-shelf commercial 
and services whenever possible, and increased the simplified 
acquisition threshold to $100,000, allowing the Department to waive 
many burdensome requirements in law for purchases in law under that 
amount.
  In deference to the work progressing through many committees on 
Government-wide acquisition reform, the Armed Services Committee 
deferred on my amendments last year. The product before us today is the 
compilation of those committee efforts. I urge my colleagues to support 
this critical, cost-saving legislation and am hopeful that House and 
Senate leaders will ensure that it becomes law this year.
  Mrs. MALONEY. Mr. Speaker, the Federal Government spends over $200 
billion on procurement every year--that's $800 for every American spent 
on goods and services. There are few areas of the Federal Government 
that are more important for controlling spending and better managing 
our limited resources.
  As a cochair of the Bipartisan Freshman Task Force on Procurement 
Reform, I am enthusiastic about H.R. 2238, the Federal Acquisition 
Improvement Act of 1994, and I strongly urge its passage.
  This legislation will simplify and streamline the Federal procurement 
process while ensuring its fairness, accountability, and integrity. It 
will reduce paperwork, especially for contracts under $100,000, and 
will help the Federal Government to buy commercial products at the 
fairest prices.
  It also incorporates several of the Vice President's National 
Performance Review recommendations, such as providing for multiyear 
contracts, promoting excellence in vendor performance, and allowing 
State and local governments to use Federal supply services.
  This legislation will help the Government save significant sums of 
money, and I strongly urge passage of this major procurement reform 
legislation.
  Mr. CLINGER. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  Mr. CONYERS. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Michigan [Mr. Conyers] that the House suspend the rules 
and pass the bill, H.R. 2238, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid upon the table.
  The title of the bill was amended so as to read: ``A bill to revise 
and streamline the acquisition laws of the Federal Government, and for 
other purposes.''


                             general leave

  Mr. CONYERS. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days within which to revise and extend their 
remarks on H.R. 2238, the bill just passed.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Michigan?
  There was no objection.
  Mr. CONYERS. Mr. Speaker, I ask unanimous consent to take from the 
Speaker's table the Senate bill (S. 1587) to revise and streamline the 
acquisition laws of the Federal Government, and for other purposes, and 
ask for its immediate consideration.
  The Clerk read the title of the Senate bill.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Michigan?
  There was no objection.
  The Clerk read the Senate bill, as follows:

                                S. 1587

       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 ``Federal Acquisition 
     Streamlining Act of 1994''.

     SEC. 2. TABLE OF CONTENTS.

       The table of contents for this Act is as follows:

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

                      TITLE I--CONTRACT FORMATION

                    Subtitle A--Competition Statutes

                  Part I--Armed Services Acquisitions


                  SUBPART A--COMPETITION REQUIREMENTS

Sec. 1001. References to Federal Acquisition Regulation.
Sec. 1002. Establishment or maintenance of alternative sources of 
              supply.
Sec. 1003. Clarification of approval authority for use of procedures 
              other than full and open competition.
Sec. 1004. Task order contracts for advisory and assistance services.
Sec. 1005. Acquisition of expert services.


        SUBPART B--PLANNING, SOLICITATION, EVALUATION, AND AWARD

Sec. 1011. Source selection factors.
Sec. 1012. Solicitation provision regarding evaluation of purchase 
              options.
Sec. 1013. Prompt notice of award.
Sec. 1014. Post-award debriefings.
Sec. 1015. Protest file.
Sec. 1016. Award of costs and fees in agency settlement of protests.
Sec. 1017. Two-phase selection procedures.


                     SUBPART C--KINDS OF CONTRACTS

Sec. 1021. Secretarial determination regarding use of cost type or 
              incentive contract.
Sec. 1022. Technical and conforming amendments.


     SUBPART D--MISCELLANEOUS PROVISIONS FOR THE ENCOURAGEMENT OF 
                              COMPETITION

Sec. 1031. Repeal of requirement for annual report by advocates for 
              competition.

                 Part II--Civilian Agency Acquisitions


                  SUBPART A--COMPETITION REQUIREMENTS

Sec. 1051. References to Federal Acquisition Regulation.
Sec. 1052. Establishment or maintenance of alternative sources of 
              supply.
Sec. 1053. Clarification of approval authority for use of procedures 
              other than full and open competition.
Sec. 1054. Task order contracts for advisory and assistance services.
Sec. 1055. Acquisition of expert services.
Sec. 1056. Continued occupancy of leased space.


        SUBPART B--PLANNING, SOLICITATION, EVALUATION, AND AWARD

Sec. 1061. Solicitation, evaluation, and award.
Sec. 1062. Solicitation provision regarding evaluation of purchase 
              options.
Sec. 1063. Prompt notice of award.
Sec. 1064. Post-award debriefings.
Sec. 1065. Protest file.
Sec. 1066. Award of costs and fees in agency settlement of protests.
Sec. 1067. Two-phase selection procedures.


                     SUBPART C--KINDS OF CONTRACTS

Sec. 1071. Agency head determination regarding use of cost type or 
              incentive contract.
Sec. 1072. Multiyear contracting authority.
Sec. 1073. Severable services contracts crossing fiscal years.
Sec. 1074. Economy Act purchases.

                    Part III--Acquisitions Generally

Sec. 1091. Policy regarding consideration of contractor past 
              performance.
Sec. 1092. Repeal of requirement for annual report on competition.

                   Subtitle B--Truth in Negotiations

                  Part I--Armed Services Acquisitions

Sec. 1201. Stabilization of dollar threshold of applicability.
Sec. 1202. Exceptions to cost or pricing data requirements.
Sec. 1203. Limitation on authority to require a submission not 
              otherwise required.
Sec. 1204. Additional special rules for commercial items.
Sec. 1205. Right of United States to examine contractor records.
Sec. 1206. Required regulations.
Sec. 1207. Consistency of time references.
Sec. 1208. Exception for transfers between divisions, subsidiaries, and 
              affiliates.
Sec. 1209. Repeal of superseded provision.

                 Part II--Civilian Agency Acquisitions

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

                  Subtitle C--Research and Development

Sec. 1301. Research projects.
Sec. 1302. Elimination of inflexible terminology regarding coordination 
              and communication of defense research activities.

                    Subtitle D--Procurement Protests

              Part I--Protests to the Comptroller General

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

                Part II--Protests in the Federal Courts

Sec. 1421. Nonexclusivity of remedies.
Sec. 1422. Jurisdiction of the United States Court of Federal Claims.

    Part III--Protests in Procurements of Automatic Data Processing

Sec. 1431. Revocation of delegations of procurement authority.
Sec. 1432. Authority of the General Services Administration Board of 
              Contract Appeals.
Sec. 1433. Periods for certain actions.
Sec. 1434. Dismissals of protests.
Sec. 1435. Award of costs.
Sec. 1436. Dismissal agreements.
Sec. 1437. Jurisdiction of district courts.
Sec. 1438. Matters to be covered in regulations.
Sec. 1439. Definitions.

               Subtitle E--Definitions and Other Matters

                  Part I--Armed Services Acquisitions

Sec. 1501. Definitions.
Sec. 1502. Delegation of procurement functions.
Sec. 1503. Determinations and decisions.
Sec. 1504. Undefinitized contractual actions: restrictions.
Sec. 1505. Production special tooling and production special test 
              equipment: contract terms and conditions.
Sec. 1506. Regulations for bids.

                 Part II--Civilian Agency Acquisitions

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

                   TITLE II--CONTRACT ADMINISTRATION

                      Subtitle A--Contract Payment

                  Part I--Armed Services Acquisitions

Sec. 2001. Contract financing.
Sec. 2002. Contracts: vouchering procedures.

                 Part II--Civilian Agency Acquisitions

Sec. 2051. Contract financing.

                      Subtitle B--Cost Principles

                  Part I--Armed Services Acquisitions

Sec. 2101. Allowable contract costs.
Sec. 2102. Contract profit controls during emergency periods.

                 Part II--Civilian Agency Acquisitions

Sec. 2151. Allowable contract costs.

                    Part III--Acquisitions Generally

Sec. 2191. Travel expenses of government contractors.
Sec. 2192. Unallowability of entertainment costs under covered 
              contracts.

                Subtitle C--Audit and Access to Records

                  Part I--Armed Services Acquisitions

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

                 Part II--Civilian Agency Acquisitions

Sec. 2251. Authority to examine records of contractors.

                 Subtitle D--Cost Accounting Standards

Sec. 2301. Exceptions to coverage.
Sec. 2302. Repeal of obsolete deadline regarding procedural regulations 
              for the Cost Accounting Standards Board.

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

                  Part I--Armed Services Acquisitions

Sec. 2401. Procurement of critical aircraft and ship spare parts; 
              quality control.
Sec. 2402. Contractor guarantees regarding weapon systems.

                    Part II--Acquisitions Generally

Sec. 2451. Section 3737 of the Revised Statutes: expansion of authority 
              to prohibit setoffs against assignees; reorganization of 
              section; revision of obsolete provisions.
Sec. 2452. Repeal of requirement for deposit of contracts with GAO.

                    Subtitle F--Claims and Disputes

                  Part I--Armed Services Acquisitions

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

                    Part II--Acquisitions Generally

Sec. 2551. Claims jurisdiction of United States district courts and the 
              United States Court of Federal Claims.
Sec. 2552. Contract Disputes Act improvements.
Sec. 2553. Extension of alternative dispute resolution authority.
Sec. 2554. Expedited resolution of contract administration complaints.
Sec. 2555. Authority for District Courts to obtain advisory opinions 
              from boards of contract appeals in certain cases.

         TITLE III--SERVICE SPECIFIC AND MAJOR SYSTEMS STATUTES

                   Subtitle A--Major Systems Statutes

Sec. 3001. Requirement for independent cost estimates and manpower 
              estimates before development or production.
Sec. 3002. Enhanced program stability.
Sec. 3003. Repeal of requirement to designate certain major defense 
              acquisition programs as defense enterprise programs.
Sec. 3004. Repeal of requirement for competitive prototyping in major 
              programs.
Sec. 3005. Repeal of requirement for competitive alternative sources in 
              major programs.

                      Subtitle B--Testing Statutes

Sec. 3011. Director of Operational Test and Evaluation to report 
              directly to Secretary of Defense.
Sec. 3012. Responsibility of Director of Operational Test and 
              Evaluation for live fire testing.
Sec. 3013. Requirement for unclassified version of annual report on 
              operational test and evaluation.

                   Subtitle C--Service Specific Laws

Sec. 3021. Gratuitous services of officers of certain reserve 
              components.
Sec. 3022. Authority to rent samples, drawings, and other information 
              to others.
Sec. 3023. Civil Reserve Air Fleet.
Sec. 3024. Exchange of personnel.
Sec. 3025. Scientific investigation and research for the Navy.
Sec. 3026. Construction of combatant and escort vessels and assignment 
              of vessel projects.
Sec. 3027. Repeal of requirement for construction of vessels on Pacific 
              coast.
Sec. 3028. Authority to transfer by gift a vessel stricken from Naval 
              Vessel Register.
Sec. 3029. Naval salvage facilities.

 Subtitle D--Department of Defense Commercial and Industrial Activities

Sec. 3051. Accounting requirement for contracted advisory and 
              assistance services.

               Subtitle E--Fuel- and Energy-Related Laws

Sec. 3061. Liquid fuels and natural gas: contracts for storage, 
              handling, or distribution.

                      Subtitle F--Fiscal Statutes

Sec. 3071. Disbursement of funds of military department to cover 
              obligations of another agency of Department of Defense.

                       Subtitle G--Miscellaneous

Sec. 3081. Obligation of funds: limitation.
Sec. 3082. Repeal of requirements regarding product evaluation 
              activities.
Sec. 3083. Codification and revision of limitation on lease of vessels, 
              aircraft, and vehicles.
Sec. 3084. Soft drink supplies for exchange stores.
Sec. 3085. Repeal of preference for recycled toner cartridges.

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

              Subtitle A--Simplified Acquisition Threshold

                   Part I--Establishment of Threshold

Sec. 4001. Simplified acquisition threshold.

                 Part II--Simplification of Procedures

Sec. 4011. Simplified acquisition procedures.
Sec. 4012. Small business reservation.
Sec. 4013. Fast payment under simplified acquisition procedures.
Sec. 4014. Procurement notice.
Sec. 4015. Electronic commerce for Federal Government procurements.

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

Sec. 4021. Future enacted procurement laws.
Sec. 4022. Armed services acquisitions.
Sec. 4023. Civilian agency acquisitions.
Sec. 4024. Acquisitions generally.

                     Part IV--Conforming Amendments

Sec. 4071. Armed services acquisitions.
Sec. 4072. Civilian agency acquisitions.
Sec. 4073. Office of Federal Procurement Policy Act.
Sec. 4074. Small Business Act.

                    Part V--Revision of Regulations

Sec. 4081. Revision required.

           Subtitle B--Socioeconomic and Small Business Laws

Sec. 4101. Acquisitions generally.
Sec. 4102. Acquisitions from small businesses.
Sec. 4103. Contracting program for certain small business concerns.
Sec. 4104. Procurement goals for small business concerns owned by 
              women.
Sec. 4105. Development of definitions regarding certain small business 
              concerns.

               Subtitle C--Miscellaneous Acquisition Laws

Sec. 4151. Prohibition on use of funds for documenting economic or 
              employment impact of certain acquisition programs.
Sec. 4152. Restriction on use of noncompetitive procedures for 
              procurement from a particular source.

                    TITLE V--ACQUISITION MANAGEMENT

                Subtitle A--Armed Services Acquisitions

Sec. 5001. Performance based management.
Sec. 5002. Results oriented acquisition program cycle.
Sec. 5003. Defense acquisition pilot program designations.

                Subtitle B--Civilian Agency Acquisitions

Sec. 5051. Performance based management.
Sec. 5052. Results-oriented acquisition process.

                       Subtitle C--Miscellaneous

Sec. 5091. Contractor exceptional performance awards.
Sec. 5092. Department of Defense acquisition of intellectual property 
              rights.

                     TITLE VI--STANDARDS OF CONDUCT

                     Subtitle A--Ethics Provisions

Sec. 6001. Amendments to Office of Federal Procurement Policy Act.
Sec. 6002. Amendments to title 18, United States Code.
Sec. 6003. Repeal of superseded and obsolete laws.
Sec. 6004. Implementation.

                   Subtitle B--Additional Amendments

Sec. 6051. Contracting functions performed by Federal personnel.
Sec. 6052. Repeal of executed requirement for study and report.
Sec. 6053. Interests of Members of Congress.
Sec. 6054. Waiting period for significant changes proposed for 
              acquisition regulations.

                  Subtitle C--Whistleblower Protection

Sec. 6101. Armed services procurements.
Sec. 6102. Governmentwide whistleblower protections for contractor 
              employees.

                TITLE VII--DEFENSE TRADE AND COOPERATION

Sec. 7001. Purchases of foreign goods.
Sec. 7002. International cooperative agreements.
Sec. 7003. Acquisition, cross-servicing agreements, and 
              standardization.

                      TITLE VIII--COMMERCIAL ITEMS

Sec. 8001. Definitions.
Sec. 8002. Preference for acquisition of commercial items and 
              nondevelopmental items.
Sec. 8003. Acquisition of commercial items.
Sec. 8004. Class waiver of applicability of certain laws.
Sec. 8005. Inapplicability of certain provisions of law.
Sec. 8006. Flexible deadlines for submission of offers of commercial 
              items.
Sec. 8007. Advocates for acquisition of commercial and nondevelopmental 
              items.
Sec. 8008. Provisions not affected.
Sec. 8009. Comptroller General review of Federal Government use of 
              market research.

                   TITLE IX--MISCELLANEOUS PROVISIONS

Sec. 9001. Comptroller General review of the provision of legal advice 
              for inspectors general.
Sec. 9002. Cost savings for official travel.
Sec. 9003. Prompt resolution of audit recommendations.
Sec. 9004. Uniform suspension and debarment.

              TITLE X--EFFECTIVE DATES AND IMPLEMENTATION

Sec. 10001. Effective dates.
Sec. 10002. Implementing regulations.
Sec. 10003. Evaluation by the Comptroller General.
Sec. 10004. Data collection through the Federal procurement data 
              system.

  TITLE IX--WAIVER OF THE APPLICATION OF THE PREVAILING WAGE-SETTING 
                       REQUIREMENTS TO VOLUNTEERS

Sec. 11001. Short title.
Sec. 11002. Purpose.
Sec. 11003. Waiver.
Sec. 11004. Report.
                      TITLE I--CONTRACT FORMATION
                    Subtitle A--Competition Statutes

                  PART I--ARMED SERVICES ACQUISITIONS

                  Subpart A--Competition Requirements

     SEC. 1001. REFERENCES TO FEDERAL ACQUISITION REGULATION.

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

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

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

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

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

     SEC. 1004. TASK ORDER CONTRACTS FOR ADVISORY AND ASSISTANCE 
                   SERVICES.

       (a) Authority.--
       (1) In general.--Chapter 137 of title 10, United States 
     Code, is amended by inserting after section 2304 the 
     following new section:

     ``Sec. 2304a. Task order contracts for advisory and 
       assistance services

       ``(a) Authority To Award.--(1) Subject to the requirements 
     of this section, the head of an agency may enter into a 
     contract for advisory and assistance services that does not 
     procure or specify a firm quantity of services (other than a 
     minimum or maximum quantity) and that provides for the 
     issuance of task orders during the specified period of the 
     contract.
       ``(2) Except as provided in subsection (h), the head of an 
     agency may enter into a contract described in paragraph (1) 
     only under the authority of this section.
       ``(b) Limitation on Contract Period.--The period of a 
     contract referred to in subsection (a), including all periods 
     of extensions of the contract under options, modifications, 
     or otherwise, may not exceed 5 years unless a longer period 
     is specifically authorized in a law that is applicable to 
     such contract.
       ``(c) Contract Procedures.--(1) The head of an agency may 
     use procedures other than competitive procedures to enter 
     into a contract referred to in subsection (a) only if an 
     exception in subsection (c) of section 2304 of this title 
     applies to the contract and the use of such procedures is 
     approved in accordance with subsection (f) of such section.
       ``(2) The notice required by section 18 of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 416) and section 
     8(e) of the Small Business Act (15 U.S.C. 637(e)) shall 
     reasonably and fairly describe the general scope, magnitude, 
     and duration of the proposed contract in a manner that would 
     reasonably enable a potential offeror to decide whether to 
     request the solicitation and consider submitting an offer.
       ``(3) The solicitation shall include the following:
       ``(A) The period of the contract, including the number of 
     options to extend the contract and the period for which the 
     contract may be extended under each option, if any.
       ``(B) The maximum quantity or dollar value of services to 
     be procured under the contract.
       ``(C) A statement of work, specifications, or other 
     description that reasonably describes the general scope, 
     nature, complexity, and purposes of the services to be 
     procured under the contract.
       ``(4)(A) The head of an agency may, on the basis of one 
     solicitation, award separate contracts under this section for 
     the same or similar services to two or more sources if the 
     solicitation states that the head of the agency has the 
     option to do so.
       ``(B) If, in the case of a contract for advisory and 
     assistance services to be entered into under the authority of 
     this section, the contract period is to exceed 3 years and 
     the contract amount is estimated to exceed $10,000,000 
     (including all options), the solicitation shall--
       ``(i) provide for a multiple award authorized under 
     subparagraph (A); and
       ``(ii) include a statement that the head of the agency may 
     also elect to award only one contract if the head of the 
     agency determines in writing that only one of the offerers is 
     capable of providing the services required at the level of 
     quality required.
       ``(C) Subparagraph (B) does not apply in the case of a 
     solicitation for which the head of an agency determines in 
     writing that, because the services required under the 
     contract are unique or highly specialized, it is not 
     practicable to award more than one contract.
       ``(5) A contract referred to in subsection (a) shall 
     contain the same information that is required by paragraph 
     (3) to be included in the solicitation of offers for that 
     contract.
       ``(d) Order Procedures.--(1) The following actions are not 
     required for a task order issued under a contract entered 
     into in accordance with this section:
       ``(A) A separate notice for such order under section 18 of 
     the Office of Federal Procurement Policy Act (41 U.S.C. 416) 
     or section 8(e) of the Small Business Act (15 U.S.C. 637(e)).
       ``(B) Except as provided in paragraph (2), a competition 
     (or a waiver of competition approved in accordance with 
     section 2304(f) of this title) that is separate from that 
     used for entering into the contract.
       ``(2)(A) When multiple contracts are awarded pursuant to 
     subsection (c)(4), all contractors awarded such contracts 
     shall be provided a fair opportunity to be considered, 
     pursuant to procedures set forth in the contracts, for each 
     task order in excess of $2,500 that is to be issued under any 
     of the contracts unless--
       ``(i) the agency's need for the services ordered is of such 
     unusual urgency that competition would result in unacceptable 
     delays in fulfilling the agency's needs;
       ``(ii) only one such contractor is capable of providing the 
     services required at the level of quality required because 
     the services ordered are unique or so highly specialized;
       ``(iii) the task order should be issued on a sole-source 
     basis in the interest of economy and efficiency because it is 
     a logical follow-on to a task order already issued on a 
     competitive basis; or
       ``(iv) the order must be placed with a particular 
     contractor in order to satisfy a minimum guarantee.
       ``(B) When a task order is issued in accordance with 
     subparagraph (A), the order shall include a statement of work 
     that clearly specifies all tasks to be performed under the 
     order.
       ``(3) A protest is not authorized in connection with the 
     issuance or proposed issuance of a task order except for a 
     protest on the ground that the order increases the scope, 
     period, or maximum value of the contract under which the 
     order is issued.
       ``(e) Increases in Scope, Period, or Maximum Value of 
     Contract.--(1) A task order may not increase the scope, 
     period, or maximum value of the contract under which the 
     order is issued. The scope, period, or maximum value of the 
     contract may be increased only by modification of the 
     contract.
       ``(2) Unless use of procedures other than competitive 
     procedures is authorized by an exception in subsection (c) of 
     section 2304 of this title and approved in accordance with 
     subsection (f) of such section, competitive procedures shall 
     be used for making such a modification.
       ``(3) Notice regarding the modification shall be provided 
     in accordance with section 18 of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 416) and section 8(e) of 
     the Small Business Act (15 U.S.C. 637(e)).
       ``(4)(A) Notwithstanding the limitation on the contract 
     period set forth in subsection (b) or in a solicitation or 
     contract pursuant to subsection (c), a contract entered into 
     by the head of an agency under this section may be extended 
     on a sole-source basis for a period not exceeding 6 months if 
     the agency head determines that--
       ``(i) the award of a follow-on contract has been delayed by 
     circumstances that were not reasonably foreseeable at the 
     time the initial contract was entered into; and
       ``(ii) the extension is necessary in order to ensure 
     continuity of the receipt of services pending the award of, 
     and commencement of performance under, the follow-on 
     contract.
       ``(B) A contract may be extended under the authority of 
     subparagraph (A) only once and only in accordance with the 
     limitations and requirements of this subsection.
       ``(f) Task Order Ombudsman.--Each head of an agency who 
     awards multiple contracts pursuant to subsection (c)(4) shall 
     appoint or designate a task order ombudsman who shall be 
     responsible for reviewing complaints from the contractors on 
     such contracts and ensuring that all of the contractors are 
     afforded a fair opportunity to be considered for task orders 
     when required under subsection (d)(2). The task order 
     ombudsman shall be a senior agency official who is 
     independent of the contracting officer for the contracts and 
     may be the agency's competition advocate.
       ``(g) Inapplicability to Certain Contracts.--This section 
     does not apply to a contract for the acquisition of property 
     or services that includes acquisition of advisory and 
     assistance services if the head of an agency entering into 
     such contract determines that, under the contract, advisory 
     and assistance services are necessarily incident to, and not 
     a significant component of, the contract.
       ``(h) Relationship to Other Contracting Authority.--Nothing 
     in this section may be construed to limit the authority of 
     the head of an agency to enter into single or multiple task 
     order contracts, or single or multiple delivery order 
     contracts, for property or services (other than advisory and 
     assistance services) under other provisions of this chapter 
     or under any other provision of law.
       ``(i) Advisory and Assistance Services Defined.--In this 
     section, the term `advisory and assistance services' has the 
     meaning given such term in section 1105(g) of title 31.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of such chapter is amended by inserting after the 
     item relating to section 2304 the following new item:

``2304a. Task order contracts for advisory and assistance services.''.

       (b) Repeal of Superseded Provision.--Section 2304 of title 
     10, United States Code, is amended by striking out subsection 
     (j).
       (c) Conforming Amendment for Professional and Technical 
     Services.--Section 2331 of title 10, United States Code, is 
     amended by striking out subsection (c).

     SEC. 1005. ACQUISITION OF EXPERT SERVICES.

       Section 2304(c)(3) of title 10, United States Code, is 
     amended--
       (1) by striking out ``or (B)'' and inserting in lieu 
     thereof ``(B)''; and
       (2) by inserting before the semicolon at the end the 
     following: ``, or (C) to procure the services of an expert 
     for use, in any litigation or dispute (including any 
     reasonably foreseeable litigation or dispute) involving the 
     Federal Government, in any trial, hearing, or proceeding 
     before any court, administrative tribunal, or agency, or in 
     any part of an alternative dispute resolution process, 
     whether or not the expert is expected to testify''.

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

     SEC. 1011. SOURCE SELECTION FACTORS.

       Section 2305(a) of title 10, United States Code, is 
     amended--
       (1) in paragraph (2)--
       (A) in subparagraph (A)(i), by striking out ``nonprice-
     related factors)'' and inserting in lieu thereof ``nonprice-
     related factors and subfactors)''; and
       (B) in subparagraph (B)(ii), by striking out subclause (I) 
     and inserting in lieu thereof the following:
       ``(I) either a statement that the proposals are intended to 
     be evaluated with, and award made after, discussions with the 
     offerors, or a statement that the proposals are intended to 
     be evaluated, and award made, without discussions with the 
     offerors (other than discussions conducted for the purpose of 
     minor clarification) unless discussions are determined to be 
     necessary; and''; and
       (2) by striking out paragraph (3) and inserting in lieu 
     thereof the following:
       ``(3)(A) In prescribing the evaluation factors to be 
     included in each solicitation for competitive proposals, the 
     head of an agency--
       ``(i) shall clearly establish the relative importance 
     assigned to the evaluation factors and subfactors, including 
     the quality of the product or services to be provided 
     (including technical capability, management capability, prior 
     experience, and past performance of the offeror);
       ``(ii) shall include cost or price to the Government as an 
     evaluation factor that must be considered in the evaluation 
     of proposals; and
       ``(iii) shall disclose to offerors whether all evaluation 
     factors other than cost or price, when combined, are--
       ``(I) significantly more important than cost or price;
       ``(II) approximately equal in importance to cost or price; 
     or
       ``(III) significantly less important than cost or price.
       ``(B) Nothing in this paragraph prohibits an agency from--
       ``(i) providing additional information in a solicitation, 
     including numeric weights for all evaluation factors; or
       ``(ii) stating in a solicitation that award will be made to 
     the offeror that meets the solicitation's mandatory 
     requirements at the lowest cost or price.''.

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

       (a) Options for Additional Purchases.--Subsection (a) of 
     section 2305 of title 10, United States Code, as amended by 
     section 1011, is further amended by adding at the end the 
     following new paragraph:
       ``(4) The head of an agency, in issuing a solicitation for 
     a contract to be awarded using sealed bid procedures, may not 
     include in such solicitation a clause providing for the 
     evaluation of prices for options to purchase additional 
     property or services under the contract unless the head of 
     the agency has determined that there is a reasonable 
     likelihood that the options will be exercised.''.
       (b) Repeal of Superseded Provision.--Section 2301(a) of 
     such title is amended--
       (1) by striking out paragraph (7);
       (2) by inserting ``and'' at the end of paragraph (5); and
       (3) by striking out ``; and'' at the end of paragraph (6) 
     and inserting in lieu thereof a period.

     SEC. 1013. PROMPT NOTICE OF AWARD.

       (a) Sealed Bid Procedures.--Section 2305(b)(3) of title 10, 
     United States Code, is amended by adding at the end the 
     following: ``As soon as practicable after the date of 
     contract award, the head of the agency shall, in accordance 
     with procedures prescribed in the Federal Acquisition 
     Regulation, notify all offerors not awarded the contract that 
     the contract has been awarded.''.
       (b) Competitive Proposals Procedures.--Section 
     2305(b)(4)(B) of title 10, United States Code, is amended in 
     the second sentence by striking out ``source and shall 
     promptly notify'' and inserting in lieu thereof ``source. As 
     soon as practicable after the date of contract award, the 
     head of the agency shall, in accordance with procedures 
     prescribed in the Federal Acquisition Regulation, notify''.

     SEC. 1014. POST-AWARD DEBRIEFINGS.

       Section 2305(b) of title 10, United States Code, is 
     amended--
       (1) by redesignating paragraph (5) as paragraph (6); and
       (2) by inserting after paragraph (4) the following new 
     paragraph (5):
       ``(5)(A) When a contract is awarded by the head of an 
     agency on the basis of competitive proposals, an unsuccessful 
     offeror, upon written request received by the agency within 3 
     days after the date on which the unsuccessful offeror 
     receives the notification of the contract award, shall be 
     debriefed and furnished the basis for the selection decision 
     and contract award. An employee of the agency shall debrief 
     the offeror promptly after receipt of the request by the 
     agency.
       ``(B) The debriefing shall include, at a minimum--
       ``(i) the agency's evaluation of the significant weak or 
     deficient factors in the offeror's offer;
       ``(ii) the overall evaluated cost and technical rating of 
     the offer of the contractor awarded the contract and the 
     overall evaluated cost and technical rating of the offer of 
     the debriefed offeror;
       ``(iii) the overall ranking of all offers;
       ``(iv) a summary of the rationale for the award;
       ``(v) in the case of a proposal for a commercial item other 
     than a commercial component, the make and model of the item 
     being provided in accordance with the offer of the contractor 
     awarded the contract; and
       ``(vi) reasonable responses to questions posed by the 
     debriefed offeror as to whether source selection procedures 
     set forth in the solicitation, applicable regulations, and 
     other applicable authorities were followed by the agency.
       ``(C) The debriefing may not include point-by-point 
     comparisons of the debriefed offeror's offer with other 
     offers and may not disclose any information that is exempt 
     from disclosure under section 552 of title 5, including 
     information relating to--
       ``(i) trade secrets;
       ``(ii) privileged or confidential manufacturing processes 
     and techniques; and
       ``(iii) commercial and financial information that is 
     privileged or confidential, including cost breakdowns, 
     profit, indirect cost rates, and similar information.
       ``(D) Each solicitation for competitive proposals shall 
     include a statement that information described in 
     subparagraph (B) may be disclosed in post-award debriefings.
       ``(E) If, within one year after the date of the contract 
     award and as a result of a successful procurement protest or 
     otherwise, the agency seeks to fulfill the requirement under 
     the contract either on the basis of a new solicitation of 
     offers or on the basis of new best and final offers requested 
     for that contract, the agency shall make available to all 
     offerors--
       ``(i) the information provided in debriefings under this 
     paragraph regarding the offer of the contractor awarded the 
     contract; and
       ``(ii) the same information that would have been provided 
     to the original offerors.
       ``(F) The contracting officer shall include a summary of 
     the debriefing in the contract file.''.

     SEC. 1015. PROTEST FILE.

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

     SEC. 1016. AWARD OF COSTS AND FEES IN AGENCY SETTLEMENT OF 
                   PROTESTS.

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

     SEC. 1017. TWO-PHASE SELECTION PROCEDURES.

       (a) Procedures Authorized.--Chapter 137 of title 10, United 
     States Code, is amended by inserting after section 2305 the 
     following new section:

     ``Sec. 2305a. Two-phase selection procedures

       ``(a) Procedures Authorized.--The head of an agency may use 
     two-phase selection procedures for entering into a contract 
     for the acquisition of property or services (other than a 
     construction contract) when the head of the agency determines 
     that three or more offers will be received for such contract, 
     substantial design work must be performed before an offeror 
     can develop a price or cost proposal for such contract, and 
     the offerors will incur a substantial amount of expenses in 
     preparing the offers.
       ``(b) Procedures Described.--Two-phase selection procedures 
     consist of the following:
       ``(1) The head of the agency solicits proposals that--
       ``(A) include information on the offerors'--
       ``(i) technical approach; and
       ``(ii) technical qualifications; and
       ``(B) do not include--
       ``(i) detailed design information; or
       ``(ii) cost or price information.
       ``(2) The head of the agency evaluates the proposals on the 
     basis of evaluation criteria set forth in the solicitation, 
     except that the head of the agency does not consider cost-
     related or price-related evaluation factors.
       ``(3) The head of the agency selects at least three 
     offerors as the most highly qualified to provide the property 
     or services under the contract and requests the selected 
     offerors to submit competitive proposals that include cost or 
     price information.
       ``(4) The head of the agency awards the contract in 
     accordance with section 2305(b)(4) of this title.
       ``(c) Solicitation To State Number of Offerors To Be 
     Selected for Phase Two Requests for Competitive Proposals.--A 
     solicitation issued pursuant to subsection (b)(1) shall state 
     the maximum number of offerors that are to be selected to 
     submit competitive proposals pursuant to subsection (b)(3).
       ``(d) Resource Comparison Criterion Required.--In using 
     two-phase selection procedures for entering into a contract, 
     the head of the agency shall establish a resource criterion 
     or a financial criterion applicable to the contract in order 
     to provide a consistent basis for comparing the offerors and 
     their proposals.''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of such chapter is amended by inserting after the 
     item relating to section 2305 the following:

``2305a. Two-phase selection procedures.''.

                     Subpart C--Kinds of Contracts

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

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

     SEC. 1022. TECHNICAL AND CONFORMING AMENDMENTS.

       (a) Repeal of Unnecessary Cross Reference.--Subsection (f) 
     of section 2306 of title 10, United States Code, is repealed.
       (b) Conforming Amendment.--Such section is amended by 
     redesignating subsections (d), (e), (g), and (h) as 
     subsections (c), (d), (e), and (f), respectively.
       (c) Neuterization of Reference.--Subsection (e)(1) of such 
     section, as redesignated by subsection (b), is amended in the 
     matter above clause (i) by striking out ``whenever he finds'' 
     and inserting in lieu thereof ``whenever the head of the 
     agency finds''.

     Subpart D--Miscellaneous Provisions for the Encouragement of 
                              Competition

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

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

                  Subpart A--Competition Requirements

     SEC. 1051. REFERENCES TO FEDERAL ACQUISITION REGULATION.

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

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

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

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

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

     SEC. 1054. TASK ORDER CONTRACTS FOR ADVISORY AND ASSISTANCE 
                   SERVICES.

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


      ``task order contracts for advisory and assistance services

       ``Sec. 303H. (a) Authority To Award.--(1) Subject to the 
     requirements of this section, the head of an executive agency 
     may enter into a contract for advisory and assistance 
     services that does not procure or specify a firm quantity of 
     services (other than a minimum or maximum quantity) and that 
     provides for the issuance of task orders during the specified 
     period of the contract.
       ``(2) Except as provided in subsection (h), the agency head 
     may enter into a contract described in paragraph (1) only 
     under the authority of this section.
       ``(b) Limitation on Contract Period.--The period of a 
     contract referred to in subsection (a), including all periods 
     of extensions of the contract under options, modifications, 
     or otherwise, may not exceed 5 years unless a longer period 
     is specifically authorized in a law that is applicable to 
     such contract.
       ``(c) Contract Procedures.--(1) An agency head may use 
     procedures other than competitive procedures to enter into a 
     contract referred to in subsection (a) only if an exception 
     in subsection (c) of section 303 applies to the contract and 
     the use of such procedures is approved in accordance with 
     subsection (f) of such section.
       ``(2) The notice required by section 18 of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 416) and section 
     8(e) of the Small Business Act (15 U.S.C. 637(e)) shall 
     reasonably and fairly describe the general scope, magnitude, 
     and duration of the proposed contract in a manner that would 
     reasonably enable a potential offeror to decide whether to 
     request the solicitation and consider submitting an offer.
       ``(3) The solicitation shall include the following:
       ``(A) The period of the contract, including the number of 
     options to extend the contract and the period for which the 
     contract may be extended under each option, if any.
       ``(B) The maximum quantity or dollar value of the services 
     to be procured under the contract.
       ``(C) A statement of work, specifications, or other 
     description that reasonably describes the general scope, 
     nature, complexity, and purposes of the services to be 
     procured under the contract.
       ``(4)(A) An agency head may, on the basis of one 
     solicitation, award separate contracts under this section for 
     the same or similar services to two or more sources if the 
     solicitation states that the agency head has the option to do 
     so.
       ``(B) If, in the case of a contract for advisory and 
     assistance services to be entered into under the authority of 
     this section, the contract period is to exceed 3 years and 
     the contract amount is estimated to exceed $10,000,000 
     (including all options), the solicitation shall--
       ``(i) provide for a multiple award authorized under 
     subparagraph (A); and
       ``(ii) include a statement that the agency head may also 
     elect to award only one contract if the agency head 
     determines in writing that only one of the offerers is 
     capable of providing the services required at the level of 
     quality required.
       ``(C) Subparagraph (B) does not apply in the case of a 
     solicitation for which the agency head determines in writing 
     that, because the services required under the contract are 
     unique or highly specialized, it is not practicable to award 
     more than one contract.
       ``(5) A contract referred to in subsection (a) shall 
     contain the same information that is required by paragraph 
     (3) to be included in the solicitation of offers for that 
     contract.
       ``(d) Order Procedures.--(1) The following actions are not 
     required for a task order issued under a contract entered 
     into in accordance with this section:
       ``(A) A separate notice for such order under section 18 of 
     the Office of Federal Procurement Policy Act (41 U.S.C. 416)  
     or section 8(e) of the Small Business Act (15 U.S.C. 637(e)).
       ``(B) Except as provided in paragraph (2), a competition 
     (or a waiver of competition approved in accordance with 
     section 303(f)) that is separate from that used for entering 
     into the contract.
       ``(2)(A) When multiple contracts are awarded pursuant to 
     subsection (c)(4), all contractors awarded such contracts 
     shall be provided a fair opportunity to be considered, 
     pursuant to procedures set forth in the contracts, for each 
     task order in excess of $2,500 that is to be issued under any 
     of the contracts unless--
       ``(i) the agency's need for the services ordered is of such 
     unusual urgency that competition would result in unacceptable 
     delays in fulfilling the agency's needs;
       ``(ii) only one such contractor is capable of providing the 
     services required at the level of quality required because 
     the services ordered are unique or highly specialized;
       ``(iii) the task order should be issued on a sole-source 
     basis in the interest of economy and efficiency because it is 
     a logical follow-on to a task order already issued on a 
     competitive basis; or
       ``(iv) the order must be placed with a particular 
     contractor in order to satisfy a minimum guarantee.
       ``(B) When a task order is issued in accordance with 
     subparagraph (A), the order shall include a statement of work 
     that clearly specifies all tasks to be performed under the 
     order.
       ``(3) A protest is not authorized in connection with the 
     issuance or proposed issuance of a task order except for a 
     protest on the ground that the order increases the scope, 
     period, or maximum value of the contract under which the 
     order is issued.
       ``(e) Increases in Scope, Period, or Maximum Value of 
     Contract.--(1) A task order may not increase the scope, 
     period, or maximum value of the contract under which the 
     order is issued. The scope, period, or maximum value of the 
     contract may be increased only by modification of the 
     contract.
       ``(2) Unless use of procedures other than competitive 
     procedures is authorized by an exception in subsection (c) of 
     section 303 and approved in accordance with subsection (f) of 
     such section, competitive procedures shall be used for making 
     such a modification.
       ``(3) Notice regarding the modification shall be provided 
     in accordance with section 18 of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 416) and section 8(e) of 
     the Small Business Act (15 U.S.C. 637(e)).
       ``(4)(A) Notwithstanding the limitation on the contract 
     period set forth in subsection (b) or in a solicitation or 
     contract pursuant to subsection (c), a contract entered into 
     by the head of an agency under this section may be extended 
     on a sole-source basis for a period not exceeding 6 months if 
     the agency head determines that--
       ``(i) the award of a follow-on contract has been delayed by 
     circumstances that were not reasonably foreseeable at the 
     time the initial contract was entered into; and
       ``(ii) the extension is necessary in order to ensure 
     continuity of the receipt of services pending the award of, 
     and commencement of performance under, the follow-on 
     contract.
       ``(B) A contract may be extended under the authority of 
     subparagraph (A) only once and only in accordance with the 
     limitations and requirements of this subsection.
       ``(f) Task Order Ombudsman.--Each agency head who awards 
     multiple contracts pursuant to subsection (c)(4) shall 
     appoint or designate a task order ombudsman who shall be 
     responsible for reviewing complaints from the contractors on 
     such contracts and ensuring that all of the contractors are 
     afforded a fair opportunity to be considered for task orders 
     when required under subsection (d)(2). The task order 
     ombudsman shall be a senior agency official who is 
     independent of the contracting officer for the contracts and 
     may be the agency's competition advocate.
       ``(g) Inapplicability to Certain Contracts.--This section 
     does not apply to a contract for the acquisition of property 
     or services that includes acquisition of advisory and 
     assistance services if the agency head entering into such 
     contract determines that, under the contract, advisory and 
     assistance services are necessarily incident to, and not a 
     significant component of, the contract.
       ``(h) Relationship to Other Contracting Authority.--Nothing 
     in this section may be construed to limit the authority of 
     the head of an agency to enter into single or multiple task 
     order contracts, or single or multiple delivery order 
     contracts, for goods or services (other than advisory and 
     assistance services) under other provisions of this title or 
     under any other provision of law.
       ``(i) Advisory and Assistance Services Defined.--In this 
     section, the term `advisory and assistance services' has the 
     meaning given such term in section 1105(g) of title 31, 
     United States Code.''.
       (b) Clerical Amendment.--The table of contents in the first 
     section is amended by inserting after the item relating to 
     section 303G the following new item:

``Sec. 303H. Task order contracts for advisory and assistance 
              services.''.

     SEC. 1055. ACQUISITION OF EXPERT SERVICES.

       (a) Exception to Requirement for Use of Competitive 
     Procedures.--Section 303(c)(3) of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 253(c)) is 
     amended--
       (1) by striking out ``or (B)'' and inserting in lieu 
     thereof ``(B)''; and
       (2) by inserting before the semicolon at the end the 
     following: ``, or (C) to procure the services of an expert 
     for use, in any litigation or dispute (including any 
     reasonably foreseeable litigation or dispute) involving the 
     Federal Government, in any trial, hearing, or proceeding 
     before any court, administrative tribunal, or agency, or in 
     any part of an alternative dispute resolution process, 
     whether or not the expert is expected to testify''.
       (b) Procurement Notice.--
       (1) Amendment of office of federal procurement policy 
     act.--Section 18(c) of the Office of Federal Procurement 
     Policy Act (41 U.S.C. 416(c)) is amended--
       (A) by striking out ``or'' at the end of subparagraph (D);
       (B) by striking out the period at the end of subparagraph 
     (E) and inserting in lieu thereof ``; or''; and
       (C) by adding at the end the following:
       ``(F) the procurement is for the services of an expert for 
     use in any litigation or dispute (including any reasonably 
     foreseeable litigation or dispute) involving the Federal 
     Government in any trial, hearing, or proceeding before any 
     court, administrative tribunal, or agency, or in any part of 
     an alternative dispute resolution process, whether or not the 
     expert is expected to testify.''.
       (2) Amendment of small business act.--Section 8(g) of the 
     Small Business Act (15 U.S.C. 637(c)) is amended--
       (A) by striking out ``or'' at the end of subparagraph (D);
       (B) by striking out the period at the end of subparagraph 
     (E) and inserting in lieu thereof ``; or''; and
       (C) by adding at the end the following:
       ``(F) the procurement is for the services of an expert for 
     use in any litigation or dispute (including preparation for 
     any foreseeable litigation or dispute) that involves or could 
     involve the Federal Government in any trial, hearing, or 
     proceeding before any court, administrative tribunal, or 
     agency, or in any part of an alternative dispute resolution 
     process, whether or not the expert is expected to testify.''.
       (c) Repeal of Amendments to Uncodified Title.--The 
     following provisions of law are repealed:
       (1) Section 532 of Public Law 101-509 (104 Stat. 1470) and 
     the provision of law set out in quotes in that section.
       (2) Section 529 of Public Law 102-393 (106 Stat. 1761) and 
     the matters inserted and added by that section.

     SEC. 1056. CONTINUED OCCUPANCY OF LEASED SPACE.

       Section 303(d) of the Federal Property and Administrative 
     Services Act of 1949 (41 U.S.C. 253(d)) is amended--
       (1) by redesignating paragraph (2) as paragraph (3); and
       (2) by inserting after paragraph (1) the following new 
     paragraph (2):
       ``(2)(A) For the purposes of applying subsection (c)(1) in 
     the case of a follow-on lease to be entered into for the 
     purpose of providing for continued occupancy of particular 
     space in leased real property by a Federal agency, space may 
     be treated as being available only from the lessor of such 
     space and may be acquired through the use of procedures other 
     than competitive procedures (without the justification 
     otherwise required by subsection (f)) if a written 
     determination is made by the contracting officer that--
       ``(i) the occupying agency has a continuing need for the 
     space;
       ``(ii) the space meets the needs of the agency; and
       ``(iii) the lessor is willing to continue to provide the 
     space at a fair market price determined by the contracting 
     officer on the basis of a market survey or an appraisal 
     conducted in accordance with generally accepted real property 
     appraisal standards.
       ``(B) The authority under subparagraph (A) to use 
     procedures other than competitive procedures to enter into a 
     follow-on lease may be exercised not more than once to 
     provide for continued occupancy of particular space in real 
     property by a particular Federal agency. The period of such 
     follow-on lease may not exceed 5 years.
       ``(C) Nothing in this paragraph may be construed to 
     prohibit the use of procedures other than competitive 
     procedures to enter into a follow-on lease of real property 
     for continued occupancy of particular space in real property 
     by a Federal agency when an exception set forth in subsection 
     (c) applies and the use of such procedures is justified and 
     approved in accordance with subsection (f).''.

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

     SEC. 1061. SOLICITATION, EVALUATION, AND AWARD.

       (a) Content of Solicitation.--Section 303A of the Federal 
     Property and Administrative Services Act of 1949 (41 U.S.C. 
     253a) is amended--
       (1) in subsection (b)(1)(A)--
       (A) by inserting ``and significant subfactors'' after ``all 
     significant factors''; and
       (B) by striking out ``(including price)'' and inserting 
     ``(including cost or price, cost-related or price-related 
     factors and subfactors, and noncost-related or nonprice-
     related factors and subfactors)'';
       (2) in subsection (b)(1)(B), by inserting ``and 
     subfactors'' after ``factors'';
       (3) in subsection (b)(2)(B), by striking out clause (i) and 
     inserting in lieu thereof the following:
       ``(i) either a statement that the proposals are intended to 
     be evaluated with, and award made after, discussions with the 
     offerors, or a statement that the proposals are intended to 
     be evaluated, and award made, without discussions with the 
     offerors (other than discussions conducted for the purpose of 
     minor clarification) unless discussions are determined to be 
     necessary; and''; and
       (4) by adding at the end the following new subsection:
       ``(c)(1) In prescribing the evaluation factors to be 
     included in each solicitation for competitive proposals, an 
     agency head--
       ``(A) shall clearly establish the relative importance 
     assigned to the evaluation factors and subfactors, including 
     the quality of the product or services to be provided 
     (including technical capability, management capability, prior 
     experience, and past performance of the offeror);
       ``(B) shall include cost or price to the Government as an 
     evaluation factor that must be considered in the evaluation 
     of proposals; and
       ``(C) shall disclose to offerors whether all evaluation 
     factors other than cost or price, when combined, are--
       ``(i) significantly more important than cost or price;
       ``(ii) approximately equal in importance to cost or price; 
     or
       ``(iii) significantly less important than cost or price.
       ``(2) Nothing in this subsection prohibits an agency from--
       ``(A) providing additional information in a solicitation, 
     including numeric weights for all evaluation factors; or
       ``(B) stating in a solicitation that award will be made to 
     the offeror that meets the solicitation's mandatory 
     requirements at the lowest price or cost.''.
       (b) Evaluation and Award.--Section 303B of the Federal 
     Property and Administrative Services Act of 1949 (41 U.S.C. 
     253b) is amended--
       (1) in subsection (a), by inserting ``, and award a 
     contract,'' after ``competitive proposals'';
       (2) in subsection (c), by inserting ``in accordance with 
     subsection (a)'' in the second sentence after ``shall 
     evaluate the bids''; and
       (3) in subsection (d)--
       (A) by striking out paragraph (1) and inserting in lieu 
     thereof the following:
       ``(1) An agency head shall evaluate competitive proposals 
     in accordance with subsection (a) and may award a contract--
       ``(A) after discussions with the offerors, provided that 
     written or oral discussions have been conducted with all 
     responsible offerors who submit proposals within the 
     competitive range; or
       ``(B) based on the proposals received and without 
     discussions with the offerors (other than discussions 
     conducted for the purpose of minor clarification), provided 
     that, as required by section 303A(b)(2)(B)(i), the 
     solicitation included a statement that proposals are intended 
     to be evaluated, and award made, without discussions, unless 
     discussions are determined to be necessary.'';
       (B) by striking out paragraphs (2) and (3) and by 
     redesignating paragraph (4) as paragraph (2); and
       (C) in paragraph (2), as redesignated by subparagraph (B), 
     by inserting ``cost or'' before ``price'' in the first 
     sentence.
       (c) Applicability.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to--
       (A) solicitations for sealed bids or competitive proposals 
     issued after the end of the 180-day period beginning on the 
     date of the enactment of this Act; and
       (B) contracts awarded pursuant to those solicitations.
       (2) Authority to apply amendments early.--The head of an 
     executive agency may apply the amendments made by this 
     section to solicitations issued before the end of the period 
     referred to in paragraph (1). The head of the executive 
     agency shall publish in the Federal Register notice of any 
     such earlier date of application at least 10 days before that 
     date.

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

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

     SEC. 1063. PROMPT NOTICE OF AWARD.

       (a) Sealed Bid Procedures.--Subsection (c) of section 303B 
     of the Federal Property and Administrative Services Act of 
     1949 (41 U.S.C. 253b) is amended by adding at the end the 
     following: ``As soon as practicable after the date of 
     contract award, the agency head shall, in accordance with 
     procedures prescribed in the Federal Acquisition Regulation, 
     notify all offerors not awarded the contract that the 
     contract has been awarded.''.
       (b) Competitive Proposals Procedures.--Paragraph (2) of 
     section 303B(d) of the Federal Property and Administrative 
     Services Act of 1949 (41 U.S.C. 253b(d)), as redesignated by 
     section 1061(b)(3)(B), is amended in the second sentence by 
     striking out ``source and shall promptly notify'' and 
     inserting in lieu thereof ``source. As soon as practicable 
     after the date of contract award, the agency head shall, in 
     accordance with procedures prescribed in the Federal 
     Acquisition Regulation, notify''.

     SEC. 1064. POST-AWARD DEBRIEFINGS.

       Section 303B of the Federal Property and Administrative 
     Services Act of 1949 (41 U.S.C. 253b) is amended--
       (1) by redesignating subsections (e) and (f) as subsections 
     (f) and (g), respectively; and
       (2) by inserting after subsection (d) the following new 
     subsection (e):
       ``(e)(1) When a contract is awarded by the head of an 
     executive agency on the basis of competitive proposals, an 
     unsuccessful offeror, upon written request received by the 
     agency within 3 days after the date on which the unsuccessful 
     offeror receives the notification of the contract award, 
     shall be debriefed and furnished the basis for the selection 
     decision and contract award. An employee of the executive 
     agency shall debrief the offeror promptly after receipt of 
     the request by the agency.
       ``(2) The debriefing shall include, at a minimum--
       ``(A) the executive agency's evaluation of the significant 
     weak or deficient factors in the offeror's offer;
       ``(B) the overall evaluated cost and technical rating of 
     the offer of the contractor awarded the contract and the 
     overall evaluated cost and technical rating of the offer of 
     the debriefed offeror;
       ``(C) the overall ranking of all offers;
       ``(D) a summary of the rationale for the award;
       ``(E) in the case of a proposal for a commercial item other 
     than a commercial component, the make and model of the item 
     being provided in accordance with the offer of the contractor 
     awarded the contract; and
       ``(F) reasonable responses to questions posed by the 
     debriefed offeror as to whether source selection procedures 
     set forth in the solicitation, applicable regulations, and 
     other applicable authorities were followed by the executive 
     agency.
       ``(3) The debriefing may not include point-by-point 
     comparisons of the debriefed offeror's offer with other 
     offers and may not disclose any information that is exempt 
     from disclosure under section 552 of title 5, United States 
     Code, including information relating to--
       ``(A) trade secrets;
       ``(B) privileged or confidential manufacturing processes 
     and techniques; and
       ``(C) commercial and financial information that is 
     privileged or confidential, including cost breakdowns, 
     profit, indirect cost rates, and similar information.
       ``(4) Each solicitation for competitive proposals shall 
     include a statement that information described in paragraph 
     (2) may be disclosed in post-award debriefings.
       ``(5) If, within one year after the date of the contract 
     award and as a result of a successful procurement protest or 
     otherwise, the executive agency seeks to fulfill the 
     requirement under the contract either on the basis of a new 
     solicitation of offers or on the basis of new best and final 
     offers requested for that contract, the agency head shall 
     make available to all offerors--
       ``(A) the information provided in debriefings under this 
     subsection regarding the offer of the contractor awarded the 
     contract; and
       ``(B) the same information that would have been provided to 
     the original offerors.
       ``(6) The contracting officer shall include a summary of 
     the debriefing in the contract file.''.

     SEC. 1065. PROTEST FILE.

       Section 303B of the Federal Property and Administrative 
     Services Act of 1949 (41 U.S.C. 253b), as amended by section 
     1064(1), is further amended by adding at the end the 
     following:
       ``(h)(1) If, in the case of a solicitation for a contract 
     issued by, or an award or proposed award of a contract by, an 
     agency head, a protest is filed pursuant to the procedures in 
     subchapter V of chapter 35 of title 31, United States Code, 
     and an actual or prospective offeror so requests, a file of 
     the protest shall be established by the procuring activity 
     and reasonable access shall be provided to actual or 
     prospective offerors.
       ``(2) Information exempt from disclosure under section 552 
     of title 5, United States Code, may be redacted in a file 
     established pursuant to paragraph (1) unless an applicable 
     protective order provides otherwise.
       ``(3) Regulations implementing this subsection shall be 
     consistent with the regulations regarding the preparation and 
     submission of an agency's protest file (the so-called `rule 4 
     file') for protests to the General Services Board of Contract 
     Appeals under section 111 of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 759).''.

     SEC. 1066. AWARD OF COSTS AND FEES IN AGENCY SETTLEMENT OF 
                   PROTESTS.

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

     SEC. 1067. TWO-PHASE SELECTION PROCEDURES.

       (a) Procedures Authorized.--Title III of the Federal 
     Property and Administrative Services Act of 1949 (41 U.S.C. 
     251 et seq.), as amended by section 1054, is further amended 
     by inserting after section 303H the following new section:


                    ``two-phase selection procedures

       ``Sec. 303I. (a) Procedures Authorized.--The head of an 
     executive agency may use two-phase selection procedures for 
     entering into a contract for the acquisition of property or 
     services (other than a construction contract) when the agency 
     head determines that three or more offers will be received 
     for such contract, substantial design work must be performed 
     before an offeror can develop a price or cost proposal for 
     such contract, and the offerors will incur a substantial 
     amount of expenses in preparing the offers.
       ``(b) Procedures Described.--Two-phase selection procedures 
     consist of the following:
       ``(1) The agency head solicits proposals that--
       ``(A) include information on the offerors'--
       ``(i) technical approach; and
       ``(ii) technical qualifications; and
       ``(B) do not include--
       ``(i) detailed design information; or
       ``(ii) cost or price information.
       ``(2) The agency head evaluates the proposals on the basis 
     of evaluation criteria set forth in the solicitation, except 
     that the agency head does not consider cost-related or price-
     related evaluation factors.
       ``(3) The agency head selects at least three offerors as 
     the most highly qualified to provide the property or services 
     under the contract and requests the selected offerors to 
     submit competitive proposals that include cost or price 
     information.
       ``(4) The agency head awards the contract in accordance 
     with section 303B(d).
       ``(c) Solicitation To State Number of Offerors To Be 
     Selected for Phase Two Requests for Competitive Proposals.--A 
     solicitation issued pursuant to subsection (b)(1) shall state 
     the maximum number of offerors that are to be selected to 
     submit competitive proposals pursuant to subsection (b)(3).
       ``(d) Resource Comparison Criterion Required.--In using 
     two-phase selection procedures for entering into a contract, 
     the agency head shall establish a resource criterion or a 
     financial criterion applicable to the contract in order to 
     provide a consistent basis for comparing the offerors and 
     their proposals.''.
       (b) Clerical Amendment.--The table of contents in the first 
     section of such Act, as amended by section 1054, is further 
     amended by inserting after the item relating to section 303H 
     the following new item:
``Sec. 303I. Two-phase selection procedures.''.

                     Subpart C--Kinds of Contracts

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

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

     SEC. 1072. MULTIYEAR CONTRACTING AUTHORITY.

       (a) Authority.--Title III of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 251 et seq.), 
     as amended by section 1067, is further amended by inserting 
     after section 303I the following new section:


                         ``multiyear contracts

       ``Sec. 303J. (a) Authority.--The head of an executive 
     agency may enter into a multiyear contract for the 
     acquisition of property or services if--
       ``(1) funds are available and obligated for such contract, 
     for the full period of the contract or for the first fiscal 
     year in which the contract is in effect, and for the 
     estimated costs associated with any necessary termination of 
     such contract; and
       ``(2) the agency head determines that--
       ``(A) the need for the property or services is reasonably 
     firm and continuing over the period of the contract; and
       ``(B) a multiyear contract will serve the best interests of 
     the United States by encouraging effective competition or 
     promoting economy in administration, performance, and 
     operation of the agency's programs.
       ``(b) Termination Clause.--A multiyear contract entered 
     into under the authority of this section shall include a 
     clause that provides that the contract shall be terminated if 
     funds are not made available for the continuation of such 
     contract in any fiscal year covered by the contract. Amounts 
     available for paying termination costs shall remain available 
     for such purpose until the costs associated with termination 
     of the contract are paid.
       ``(c) Rule of Construction.--Nothing in this section is 
     intended to modify or affect any other provision of law that 
     authorizes multiyear contracts.''.
       (b) Clerical Amendment.--The table of contents in the first 
     section of such Act, as amended by section 1067, is further 
     amended by inserting after the item relating to section 303I 
     the following new item:

``Sec. 303J. Multiyear contracts.''.

     SEC. 1073. SEVERABLE SERVICES CONTRACTS CROSSING FISCAL 
                   YEARS.

       (a) Authority.--Title III of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 251 et seq.), 
     as amended by section 1072, is further amended by inserting 
     after section 303J the following new section:


    ``severable services contracts for periods crossing fiscal years

       ``Sec. 303K. (a) Authority.--The head of an executive 
     agency may enter into a contract for procurement of severable 
     services for a period that begins in one fiscal year and ends 
     in the next fiscal year if (without regard to any option to 
     extend the period of the contract) the contract period does 
     not exceed one year.
       ``(b) Obligation of Funds.--Funds made available for a 
     fiscal year may be obligated for the total amount of a 
     contract entered into under the authority of subsection 
     (a).''.
       (b) Clerical Amendment.--The table of contents in the first 
     section of such Act, as amended by section 1072, is further 
     amended by inserting after the item relating to section 303J 
     the following new item:

``Sec. 303K. Severable services contracts for periods crossing fiscal 
              years.''.

     SEC. 1074. ECONOMY ACT PURCHASES.

       (a) Regulations Required.--Not later than six months after 
     the date of the enactment of this Act, the Federal 
     Acquisition Regulation shall be revised to include 
     regulations governing the exercise of the authority under 
     section 1535 of title 31, United States Code, for Federal 
     agencies to purchase goods and services under contracts 
     entered into or administered by other agencies.
       (b) Content of Regulations.--The regulations prescribed 
     pursuant to subsection (a) shall--
       (1) require that each purchase described in subsection (a) 
     be approved in advance by a contracting officer of the 
     ordering agency with authority to contract for the goods or 
     services to be purchased or by another official in a position 
     specifically designated by regulation to approve such 
     purchase;
       (2) provide that such a purchase of goods or services may 
     be made only if--
       (A) the purchase is appropriately made under a contract 
     that the agency filling the purchase order entered into, 
     before the purchase order, in order to meet the requirements 
     of such agency for the same or similar goods or services;
       (B) the agency filling the purchase order is better 
     qualified to enter into or administer the contract for such 
     goods or services by reason of capabilities or expertise that 
     is not available within the ordering agency; or
       (C) the agency or unit filling the order is specifically 
     authorized by law or regulations to purchase such goods or 
     services on behalf of other agencies;
       (3) prohibit any such purchase under a contract or other 
     agreement entered into or administered by an agency not 
     covered by the provisions of chapter 137 of title 10, United 
     States Code, or title III of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 251 et seq.) 
     and not covered by the Federal Acquisition Regulation unless 
     the purchase is approved in advance by the senior procurement 
     official responsible for purchasing by the ordering agency; 
     and
       (4) prohibit any payment to the agency filling a purchase 
     order of any fee that exceeds the actual cost or, if the 
     actual cost is not known, the estimated cost of entering into 
     and administering the contract or other agreement under which 
     the order is filled.
       (c) Monitoring System Required.--The Administrator for 
     Federal Procurement Policy shall ensure that, not later than 
     one year after the date of the enactment of this Act, systems 
     for collecting and evaluating procurement data are capable of 
     collecting and evaluating appropriate data on procurements 
     conducted under the regulations prescribed pursuant to 
     subsection (a).
       (d) Termination.--This section shall cease to be effective 
     one year after the date on which final regulations prescribed 
     pursuant to subsection (a) take effect.

                    PART III--ACQUISITIONS GENERALLY

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

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

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

       Section 23 of the Office of Federal Procurement Policy Act 
     (41 U.S.C. 419) is repealed.
                   Subtitle B--Truth in Negotiations

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 1201. STABILIZATION OF DOLLAR THRESHOLD OF 
                   APPLICABILITY.

       (a) Repeal of Reversion to Lower Threshold.--Paragraph 
     (1)(A) of section 2306a(a) of title 10, United States Code, 
     is amended--
       (1) in clause (i), by striking out ``and before January 1, 
     1996,''; and
       (2) in clause (ii), by striking out ``or after December 31, 
     1995,''.
       (b) Adjustments for Changes in Dollar Values.--Section 
     2306a(a) of such title is amended by adding at the end the 
     following new subparagraph:
       ``(7) Effective on October 1 of each year that is divisible 
     by 5, each amount set forth in paragraph (1) shall be 
     adjusted to the amount that is equal to the fiscal year 1994 
     constant dollar value of the amount set forth. Any amount, as 
     so adjusted, that is not evenly divisible by $50,000 shall be 
     rounded to the nearest multiple of $50,000. In the case of an 
     amount that is evenly divisible by $25,000 but not evenly 
     divisible by $50,000, the amount shall be rounded to the next 
     higher multiple of $50,000.''.

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

       (a) Exceptions Stated.--Subsection (b) of section 2306a of 
     title 10, United States Code, is amended to read as follows:
       ``(b) Exceptions.--(1) Submission of cost and pricing data 
     shall not be required under subsection (a)--
       ``(A) in the case of a contract, a subcontract, or a 
     contract or subcontract modification, for which the price 
     agreed upon is based on--
       ``(i) adequate price competition;
       ``(ii) established catalog or market prices of commercial 
     items or of services customarily used for other than 
     Government purposes, as the case may be, that are sold in 
     substantial quantities to the general public; or
       ``(iii) prices set by law or regulation; or
       ``(B) in an exceptional case when the head of the agency 
     concerned determines that the requirements of this section 
     may be waived and states in writing the reasons for such 
     determination.
       ``(2) Submission of cost and pricing data shall not be 
     required under subsection (a) in the case of a modification 
     of a contract or subcontract for a commercial item if--
       ``(A) the contract or subcontract being modified is a 
     contract or subcontract for which submission of cost and 
     pricing data may not be required by reason of paragraph 
     (1)(A);
       ``(B) the modification is not a case in which paragraph 
     (1)(A) prohibits the head of an agency from requiring 
     submission of cost and pricing data; and
       ``(C) the modification would not change the contract or 
     subcontract, as the case may be, from a contract or 
     subcontract for the acquisition of a commercial item to a 
     contract or subcontract for the acquisition of a 
     noncommercial item.''.
       (b) Conforming Amendment to Reference.--Subsection (a)(5) 
     of such section is amended by striking out ``subsection 
     (b)(2)'' and inserting in lieu thereof ``subsection 
     (b)(1)(B)''.

     SEC. 1203. LIMITATION ON AUTHORITY TO REQUIRE A SUBMISSION 
                   NOT OTHERWISE REQUIRED.

       Subsection (c) of section 2306a of title 10, United States 
     Code, is amended to read as follows:
       ``(c) Limitation on Authority To Require Cost or Pricing 
     Data.--When cost or pricing data are not required to be 
     submitted under this section by reason of a $500,000 
     threshold set forth in subsection (a) (as adjusted pursuant 
     to paragraph (7) of such subsection) or by reason of an 
     exception set forth in paragraph (1)(A) or (2) of subsection 
     (b), submission of such data may not be required unless the 
     head of an agency concerned determines that such data are 
     necessary for the evaluation by the agency of the 
     reasonableness of the price of the contract or subcontract to 
     which the data relate. In any case in which the head of an 
     agency requires such data to be submitted in accordance with 
     the preceding sentence, the agency head shall document in 
     writing the reasons for such requirement.''.

     SEC. 1204. ADDITIONAL SPECIAL RULES FOR COMMERCIAL ITEMS.

       Section 2306a of title 10, United States Code, is amended--
       (1) by redesignating subsections (d), (e), (f), and (g) as 
     subsections (e), (f), (g), and (i), respectively; and
       (2) by inserting after subsection (c) the following new 
     subsection (d):
       ``(d) Additional Exception Provisions Regarding Commercial 
     Items.--(1) To the maximum extent practicable, the head of an 
     agency shall conduct procurements of commercial items on a 
     competitive basis.
       ``(2) In any case in which it is not practicable to conduct 
     a procurement of a commercial item on a competitive basis and 
     the procurement is not covered by an exception in subsection 
     (b), the contracting officer shall nonetheless exempt a 
     contract, subcontract, or modification of a contract or 
     subcontract under the procurement from the requirements of 
     subsection (a) if the contracting officer obtains, in 
     accordance with standards and procedures set forth in the 
     Federal Acquisition Regulation, information on prices at 
     which the same or similar items have been sold in the 
     commercial market that is adequate for evaluating the 
     reasonableness of the price of the contract or subcontract 
     for a commercial item, or the contract or subcontract 
     modification, as the case may be. The contracting officer may 
     obtain such information from the offeror or contractor or, 
     when such information is not available from that source, from 
     another source or sources.
       ``(3)(A) In accordance with procedures prescribed in the 
     Federal Acquisition Regulation, the head of an agency shall 
     have the right to examine all information provided by an 
     offeror, contractor, or subcontractor pursuant to paragraph 
     (2) and all books and records of such offeror, contractor, or 
     subcontractor that directly relate to such information in 
     order to determine whether the agency is receiving accurate 
     information required under this section.
       ``(B) The right under subparagraph (A) shall expire 3 years 
     after the date of award of the contract, or 3 years after the 
     date of the modification of the contract, with respect to 
     which the information was provided.''.

     SEC. 1205. RIGHT OF UNITED STATES TO EXAMINE CONTRACTOR 
                   RECORDS.

       Section 2306a of title 10, United States Code, is amended 
     by striking out subsection (g), as redesignated by section 
     1204(1), and inserting in lieu thereof the following:
       ``(g) Right of United States To Examine Contractor 
     Records.--For the purpose of evaluating the accuracy, 
     completeness, and currency of cost or pricing data required 
     to be submitted by this section, the head of an agency shall 
     have the rights provided by section 2313 of this title.''.

     SEC. 1206. REQUIRED REGULATIONS.

       Section 2306a of title 10, United States Code, as amended 
     by sections 1204 and 1205, is further amended by inserting 
     after subsection (g) the following new subsection:
       ``(h) Required Regulations.--The Secretary shall prescribe 
     regulations concerning the types of information that offerors 
     must submit for a contracting officer to consider in 
     determining whether the price of a procurement to the 
     Government is fair and reasonable when certified cost or 
     pricing data are not required to be submitted under this 
     section because the price of the procurement to the United 
     States is not expected to exceed an applicable $500,000 
     threshold set forth in subsection (a) (as adjusted pursuant 
     to paragraph (7) of such subsection). Such information, at a 
     minimum, shall include appropriate information on the prices 
     at which the same or similar items have previously been sold 
     that is adequate for evaluating the reasonableness of the 
     price of the proposed contract or subcontract for the 
     procurement.''.

     SEC. 1207. CONSISTENCY OF TIME REFERENCES.

       Section 2306a of title 10, United States Code, as amended 
     by section 1204(1), is further amended--
       (1) in subparagraphs (A)(ii) and (B)(ii) of subsection 
     (e)(4), by inserting ``or, if applicable consistent with 
     paragraph (1)(B), another date agreed upon between the 
     parties,'' after ``(or price of the modification)''; and
       (2) in subsection (i), by inserting ``or, if applicable 
     consistent with subsection (d)(1)(B), another date agreed 
     upon between the parties'' after ``(or the price of a 
     contract modification)''.

     SEC. 1208. EXCEPTION FOR TRANSFERS BETWEEN DIVISIONS, 
                   SUBSIDIARIES, AND AFFILIATES.

       Subsection (i) of section 2306a of title 10, United States 
     Code, as redesignated by section 1204(1), is amended to read 
     as follows:
       ``(i) Definitions.--In this section:
       ``(1) The term `cost or pricing data' means all facts that, 
     as of the date of agreement on the price of a contract (or 
     the price of a contract modification), a prudent buyer or 
     seller would reasonably expect to affect price negotiations 
     significantly. Such term does not include information that is 
     judgmental, but does include the factual information from 
     which a judgment was derived.
       ``(2) The term `subcontract' includes a transfer of 
     commercial items between divisions, subsidiaries, or 
     affiliates of a contractor.''.

     SEC. 1209. REPEAL OF SUPERSEDED PROVISION.

       Subsections (b) and (c) of section 803 of Public Law 101-
     510 (10 U.S.C. 2306a note) are repealed.

                 PART II--CIVILIAN AGENCY ACQUISITIONS

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

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


             ``cost or pricing data: truth in negotiations

       ``Sec. 304A. (a) Required Cost or Pricing Data and 
     Certification.--(1) An agency head shall require offerors, 
     contractors, and subcontractors to make cost or pricing data 
     available as follows:
       ``(A) An offeror for a prime contract under this title to 
     be entered into using procedures other than sealed-bid 
     procedures shall be required to submit cost or pricing data 
     before the award of a contract if--
       ``(i) in the case of a prime contract entered into after 
     the date of the enactment of the Federal Acquisition 
     Streamlining Act of 1994, the price of the contract to the 
     United States is expected to exceed $500,000; and
       ``(ii) in the case of a prime contract entered into on or 
     before the date of the enactment of the Federal Acquisition 
     Streamlining Act of 1994, the price of the contract to the 
     United States is expected to exceed $100,000.
       ``(B) The contractor for a prime contract under this 
     chapter shall be required to submit cost or pricing data 
     before the pricing of a change or modification to the 
     contract if--
       ``(i) in the case of a change or modification made to a 
     prime contract referred to in subparagraph (A)(i), the price 
     adjustment is expected to exceed $500,000;
       ``(ii) in the case of a change or modification made to a 
     prime contract that was entered into on or before the date of 
     the enactment of the Federal Acquisition Streamlining Act of 
     1994, and that has been modified pursuant to paragraph (6), 
     the price adjustment is expected to exceed $500,000; and
       ``(iii) in the case of a change or modification not covered 
     by clause (i) or (ii), the price adjustment is expected to 
     exceed $100,000.
       ``(C) An offeror for a subcontract (at any tier) of a 
     contract under this title shall be required to submit cost or 
     pricing data before the award of the subcontract if the prime 
     contractor and each higher-tier subcontractor have been 
     required to make available cost or pricing data under this 
     section and--
       ``(i) in the case of a subcontract under a prime contract 
     referred to in subparagraph (A)(i), the price of the 
     subcontract is expected to exceed $500,000;
       ``(ii) in the case of a subcontract entered into under a 
     prime contract that was entered into on or before the date of 
     the enactment of the Federal Acquisition Streamlining Act of 
     1994, and that has been modified pursuant to paragraph (6), 
     the price of the subcontract is expected to exceed $500,000; 
     and
       ``(iii) in the case of a subcontract not covered by clause 
     (i) or (ii), the price of the subcontract is expected to 
     exceed $100,000.
       ``(D) The subcontractor for a subcontract covered by 
     subparagraph (C) shall be required to submit cost or pricing 
     data before the pricing of a change or modification to the 
     subcontract if--
       ``(i) in the case of a change or modification to a 
     subcontract referred to in subparagraph (C)(i) or (C)(ii), 
     the price adjustment is expected to exceed $500,000; and
       ``(ii) in the case of a change or modification to a 
     subcontract referred to in subparagraph (C)(iii), the price 
     adjustment is expected to exceed $100,000.
       ``(2) A person required, as an offeror, contractor, or 
     subcontractor, to submit cost or pricing data under paragraph 
     (1) (or required by the agency head concerned to submit such 
     data in accordance with subsection (c)) shall be required to 
     certify that, to the best of the person's knowledge and 
     belief, the cost or pricing data submitted are accurate, 
     complete, and current.
       ``(3) Cost or pricing data required to be submitted under 
     paragraph (1) (or in accordance with subsection (c)), and a 
     certification required to be submitted under paragraph (2), 
     shall be submitted--
       ``(A) in the case of a submission by a prime contractor (or 
     an offeror for a prime contract), to the contracting officer 
     for the contract (or to a designated representative of the 
     contracting officer); or
       ``(B) in the case of a submission by a subcontractor (or an 
     offeror for a subcontract), to the prime contractor.
       ``(4) Except as provided under subsection (b), this section 
     applies to contracts entered into by an agency head on behalf 
     of a foreign government.
       ``(5) For purposes of paragraph (1)(C), a contractor or 
     subcontractor granted a waiver under subsection (b)(1)(B) 
     shall be considered as having been required to make available 
     cost or pricing data under this section.
       ``(6)(A) Upon the request of a contractor that was required 
     to submit cost or pricing data under paragraph (1) in 
     connection with a prime contract entered into on or before 
     the date of the enactment of the Federal Acquisition 
     Streamlining Act of 1994, the agency head that entered into 
     such contract shall modify the contract to reflect 
     subparagraphs (B)(ii) and (C)(ii) of paragraph (1). All such 
     modifications shall be made without requiring consideration.
       ``(B) An agency head is not required to modify a contract 
     under subparagraph (A) if that agency head determines that 
     the submission of cost or pricing data with respect to that 
     contract should be required in accordance with subsection 
     (c).
       ``(7) Effective on October 1 of each year that is divisible 
     by 5, each amount set forth in paragraph (1) shall be 
     adjusted to the amount that is equal to the fiscal year 1994 
     constant dollar value of the amount set forth. Any amount, as 
     so adjusted, that is not evenly divisible by $50,000 shall be 
     rounded to the nearest multiple of $50,000. In the case of an 
     amount that is evenly divisible by $25,000 but not evenly 
     divisible by $50,000, the amount shall be rounded to the next 
     higher multiple of $50,000.
       ``(b) Exceptions.--(1) Submission of cost and pricing data 
     shall not be required under subsection (a)--
       ``(A) in the case of a contract, a subcontract, or a 
     contract or subcontract modification, for which the price 
     agreed upon is based on--
       ``(i) adequate price competition;
       ``(ii) established catalog or market prices of commercial 
     items or of services customarily used for other than 
     Government purposes, as the case may be, that are sold in 
     substantial quantities to the general public; or
       ``(iii) prices set by law or regulation; or
       ``(B) in an exceptional case when the agency head concerned 
     determines that the requirements of this section may be 
     waived and states in writing the reasons for such 
     determination.
       ``(2) Submission of cost and pricing data shall not be 
     required under subsection (a) in the case of a modification 
     of a contract or subcontract for a commercial item if--
       ``(A) the contract or subcontract being modified is a 
     contract or subcontract for which submission of cost and 
     pricing data may not be required by reason of paragraph 
     (1)(A);
       ``(B) the modification is not a case in which paragraph 
     (1)(A) prohibits the agency head from requiring submission of 
     cost and pricing data; and
       ``(C) the modification would not change the contract or 
     subcontract, as the case may be, from a contract or 
     subcontract for the acquisition of a commercial item to a 
     contract or subcontract for the acquisition of a 
     noncommercial item.
       ``(c) Limitation on Authority To Require Cost or Pricing 
     Data.--When cost or pricing data are not required to be 
     submitted under this section by reason of a $500,000 
     threshold set forth in subsection (a) (as adjusted pursuant 
     to paragraph (7) of such subsection) or by reason of an 
     exception in paragraph (1)(A) or (2) of subsection (b), 
     submission of such data may not be required unless the agency 
     head concerned determines that such data are necessary for 
     the evaluation by the agency of the reasonableness of the 
     price of the contract or subcontract to which the data 
     relate. In any case in which the agency head requires such 
     data to be submitted in accordance with the preceding 
     sentence, the agency head shall document in writing the 
     reasons for such requirement.
       ``(d) Additional Exception Provisions Regarding Commercial 
     Items.--(1) To the maximum extent practicable, an agency head 
     shall conduct procurements of commercial items on a 
     competitive basis.
       ``(2) In any case in which it is not practicable to conduct 
     a procurement of a commercial item on a competitive basis and 
     the procurement is not covered by an exception in subsection 
     (b), the contracting officer shall nonetheless exempt a 
     contract, subcontract, or modification of a contract or 
     subcontract under the procurement from the requirements of 
     subsection (a) if the contracting officer obtains, in 
     accordance with standards and procedures set forth in the 
     Federal Acquisition Regulation, information on prices at 
     which the same or similar items have been sold in the 
     commercial market that is adequate for evaluating the 
     reasonableness of the price of the contract or subcontract 
     for a commercial item, or the contract or subcontract 
     modification, as the case may be. The contracting officer may 
     obtain such information from the offeror or contractor or, 
     when such information is not available from that source, from 
     another source or sources.
       ``(3)(A) In accordance with procedures prescribed in the 
     Federal Acquisition Regulation, an agency head shall have the 
     right to examine all information provided by an offeror, 
     contractor, or subcontractor pursuant to paragraph (2) and 
     all books and records of such offeror, contractor, or 
     subcontractor that directly relate to such information in 
     order to determine whether the agency is receiving accurate 
     information required under this section.
       ``(B) The right under subparagraph (A) shall expire 3 years 
     after the date of award of the contract, or 3 years after the 
     date of the modification of the contract, with respect to 
     which the information was provided.
       ``(e) Price Reductions for Defective Cost or Pricing 
     Data.--(1)(A) A prime contract (or change or modification to 
     a prime contract) under which a certificate under subsection 
     (a)(2) is required shall contain a provision that the price 
     of the contract to the United States, including profit or 
     fee, shall be adjusted to exclude any significant amount by 
     which it may be determined by the agency head that such price 
     was increased because the contractor (or any subcontractor 
     required to make available such a certificate) submitted 
     defective cost or pricing data.
       ``(B) For the purposes of this section, defective cost or 
     pricing data are cost or pricing data which, as of the date 
     of agreement on the price of the contract (or another date 
     agreed upon between the parties), were inaccurate, 
     incomplete, or noncurrent. If for purposes of the preceding 
     sentence the parties agree upon a date other than the date of 
     agreement on the price of the contract, the date agreed upon 
     by the parties shall be as close to the date of agreement on 
     the price of the contract as is practicable.
       ``(2) In determining for purposes of a contract price 
     adjustment under a contract provision required by paragraph 
     (1) whether, and to what extent, a contract price was 
     increased because the contractor (or a subcontractor) 
     submitted defective cost or pricing data, it shall be a 
     defense that the United States did not rely on the defective 
     data submitted by the contractor or subcontractor.
       ``(3) It is not a defense to an adjustment of the price of 
     a contract under a contract provision required by paragraph 
     (1) that--
       ``(A) the price of the contract would not have been 
     modified even if accurate, complete, and current cost or 
     pricing data had been submitted by the contractor or 
     subcontractor because the contractor or subcontractor--
       ``(i) was the sole source of the property or services 
     procured; or
       ``(ii) otherwise was in a superior bargaining position with 
     respect to the property or services procured;
       ``(B) the contracting officer should have known that the 
     cost and pricing data in issue were defective even though the 
     contractor or subcontractor took no affirmative action to 
     bring the character of the data to the attention of the 
     contracting officer;
       ``(C) the contract was based on an agreement between the 
     contractor and the United States about the total cost of the 
     contract and there was no agreement about the cost of each 
     item procured under such contract; or
       ``(D) the prime contractor or subcontractor did not submit 
     a certification of cost and pricing data relating to the 
     contract as required under subsection (a)(2).
       ``(4)(A) A contractor shall be allowed to offset an amount 
     against the amount of a contract price adjustment under a 
     contract provision required by paragraph (1) if--
       ``(i) the contractor certifies to the contracting officer 
     (or to a designated representative of the contracting 
     officer) that, to the best of the contractor's knowledge and 
     belief, the contractor is entitled to the offset; and
       ``(ii) the contractor proves that the cost or pricing data 
     were available before the date of agreement on the price of 
     the contract (or price of the modification), or, if 
     applicable consistent with paragraph (1)(B), another date 
     agreed upon between the parties, and that the data were not 
     submitted as specified in subsection (a)(3) before such date.
       ``(B) A contractor shall not be allowed to offset an amount 
     otherwise authorized to be offset under subparagraph (A) if--
       ``(i) the certification under subsection (a)(2) with 
     respect to the cost or pricing data involved was known to be 
     false when signed; or
       ``(ii) the United States proves that, had the cost or 
     pricing data referred to in subparagraph (A)(ii) been 
     submitted to the United States before the date of agreement 
     on the price of the contract (or price of the modification) 
     or, if applicable under paragraph (1)(B), another date agreed 
     upon between the parties, the submission of such cost or 
     pricing data would not have resulted in an increase in that 
     price in the amount to be offset.
       ``(f) Interest and Penalties for Certain Overpayments.--(1) 
     If the United States makes an overpayment to a contractor 
     under a contract with an executive agency subject to this 
     section and the overpayment was due to the submission by the 
     contractor of defective cost or pricing data, the contractor 
     shall be liable to the United States--
       ``(A) for interest on the amount of such overpayment, to be 
     computed--
       ``(i) for the period beginning on the date the overpayment 
     was made to the contractor and ending on the date the 
     contractor repays the amount of such overpayment to the 
     United States; and
       ``(ii) at the current rate prescribed by the Secretary of 
     the Treasury under section 6621 of the Internal Revenue Code 
     of 1986; and
       ``(B) if the submission of such defective data was a 
     knowing submission, for an additional amount equal to the 
     amount of the overpayment.
       ``(2) Any liability under this subsection of a contractor 
     that submits cost or pricing data but refuses to submit the 
     certification required by subsection (a)(2) with respect to 
     the cost or pricing data shall not be affected by the refusal 
     to submit such certification.
       ``(g) Right of United States To Examine Contractor 
     Records.--For the purpose of evaluating the accuracy, 
     completeness, and currency of cost or pricing data required 
     to be submitted by this section, the head of an agency shall 
     have the rights provided by section 304B(a)(2).
       ``(h) Required Regulations.--The Federal Acquisition 
     Regulation shall include regulations concerning the types of 
     information that offerors must submit for a contracting 
     officer to consider in determining whether the price of a 
     procurement to the Government is fair and reasonable when 
     certified cost or pricing data are not required to be 
     submitted under this section because the price of the 
     procurement to the United States is not expected to exceed an 
     applicable $500,000 threshold set forth in subsection (a) (as 
     adjusted pursuant to paragraph (7) of such subsection). Such 
     information, at a minimum, shall include appropriate 
     information on the prices at which the same or similar items 
     have previously been sold that is adequate for evaluating the 
     reasonableness of the price of a proposed contract or 
     subcontract for the procurement.
       ``(i) Definitions.--In this section:
       ``(1) The term `cost or pricing data' means all facts that, 
     as of the date of agreement on the price of a contract (or 
     the price of a contract modification) or, if applicable 
     consistent with subsection (e)(1)(B), another date agreed 
     upon between the parties, a prudent buyer or seller would 
     reasonably expect to affect price negotiations significantly. 
     Such term does not include information that is judgmental, 
     but does include the factual information from which a 
     judgment was derived.
       ``(2) The term `subcontract' includes a transfer of 
     commercial items between divisions, subsidiaries, or 
     affiliates of a contractor.''.
       (b) Table of Contents.--The table of contents in the first 
     section of such Act is amended by inserting after the item 
     relating to section 304 the following:

``Sec. 304A. Cost or pricing data: truth in negotiations.''.

     SEC. 1252. REPEAL OF OBSOLETE PROVISION.

       (a) Repeal.--Section 303E of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 253e) is 
     repealed.
       (b) Clerical Amendment.--The table of contents in the first 
     section of such Act is amended by striking out the item 
     relating to section 303E.
                  Subtitle C--Research and Development

     SEC. 1301. RESEARCH PROJECTS.

       (a) Authorized Means.--Subsection (b) of section 2358 of 
     title 10, United States Code, is amended to read as follows:
       ``(b) Authorized Means.--The Secretary of Defense or the 
     Secretary of a military department may perform research and 
     development projects--
       ``(1) by contract entered into with, grant made to, or 
     cooperative agreement entered into with educational or 
     research institutions, private businesses, or other persons 
     in accordance with the provisions of chapter 63 of title 31;
       ``(2) through one or more military departments;
       ``(3) by using employees and consultants of the Department 
     of Defense; or
       ``(4) by mutual agreement with the head of any other 
     department or agency of the Federal Government.''.
       (b) Caption Amendment.--The caption of subsection (c) of 
     such section is amended by striking out ``Military'' and 
     inserting in lieu thereof ``Department of Defense''.
       (c) Advanced Research Projects.--
       (1) Restoration and revision of former statement of 
     authority.--Section 2371 of title 10, United States Code, is 
     amended--
       (A) by redesignating subsections (a), (b), (c), (d), (e), 
     and (f) as subsections (b), (c), (d), (e), (f), and (g), 
     respectively; and
       (B) by inserting before subsection (b), as so redesignated, 
     the following new subsection (a):
       ``(a) The Secretary of Defense, acting through the Advanced 
     Research Projects Agency and such other elements of the 
     Department of Defense as the Secretary may designate, and the 
     Secretary of each military department, in carrying out basic, 
     applied, and advanced research projects, may enter into other 
     transactions, in addition to contracts, grants, and 
     cooperative agreements authorized by section 2358 of this 
     title.''.
       (2) Conforming amendments.--Such section, as amended by 
     paragraph (1), is further amended--
       (A) in subsection (b)--
       (i) in paragraph (1), by inserting ``or subsection (a)'' 
     after ``section 2358 of this title''; and
       (ii) in paragraph (2), by striking out ``subsection (d)'' 
     and inserting in lieu thereof ``subsection (e)'';
       (B) in subsection (c), by inserting ``section 2358 of this 
     title or'' after ``under'';
       (C) in subsection (d)--
       (i) in paragraph (1), by striking out ``this section'' and 
     inserting in lieu thereof ``section 2358 of this title or 
     subsection (a)''; and
       (ii) in paragraph (3), by striking out ``this section'' and 
     inserting in lieu thereof ``section 2358 of this title or 
     subsection (a)'';
       (D) in subsection (e), by inserting ``or subsection (a)'' 
     in the first sentence after ``section 2358 of this title''; 
     and
       (E) in subsection (f)--
       (i) in the first sentence, by striking out ``under this 
     section'' and inserting in lieu thereof ``under section 2358 
     of this title or subsection (a)'';
       (ii) in paragraph (4), by striking out ``subsection (a)'' 
     and inserting in lieu thereof ``subsection (b)''; and
       (iii) in paragraph (5), by striking out ``subsection (d)'' 
     and inserting in lieu thereof ``subsection (e)''.

     SEC. 1302. ELIMINATION OF INFLEXIBLE TERMINOLOGY REGARDING 
                   COORDINATION AND COMMUNICATION OF DEFENSE 
                   RESEARCH ACTIVITIES.

       Section 2364 of title 10, United States Code, is amended--
       (1) in subsection (b)(5), by striking out ``milestone 0, 
     milestone I, and milestone II decisions'' and inserting in 
     lieu thereof ``acquisition program decisions''; and
       (2) in subsection (c), by striking out paragraphs (2), (3), 
     and (4) and inserting in lieu thereof the following:
       ``(2) The term `acquisition program decisions' has the 
     meaning given such term in regulations prescribed by the 
     Secretary of Defense for the purposes of this section.''.
                    Subtitle D--Procurement Protests

              PART I--PROTESTS TO THE COMPTROLLER GENERAL

     SEC. 1401. PROTEST DEFINED.

       Paragraph (1) of section 3551 of title 31, United States 
     Code, is amended to read as follows:
       ``(1) `protest' means a written objection by an interested 
     party--
       ``(i) to a solicitation or other request by a Federal 
     agency for offers for a contract for the procurement of 
     property or services;
       ``(ii) to the cancellation of such a solicitation or other 
     request;
       ``(iii) to an award or proposed award of such a contract; 
     or
       ``(iv) to a termination or cancellation of an award of such 
     a contract, if the written objection contains an allegation 
     that the termination or cancellation is based in whole or in 
     part on improprieties concerning the award of the 
     contract;''.

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

       (a) Periods for Certain Actions.--Section 3553 of title 31, 
     United States Code, is amended--
       (1) in subsection (b)--
       (A) in paragraph (1), by striking out ``one working day 
     of'' and inserting in lieu thereof ``one day after''; and
       (B) in paragraph (2)--
       (i) in subparagraph (A), by striking out ``25 working days 
     from'' and inserting in lieu thereof ``35 days after''; and
       (ii) in subparagraph (C), by striking out ``10 working days 
     from'' and inserting in lieu thereof ``25 days after''; and
       (2) in subsection (c)(3), by striking out ``thereafter'' 
     and inserting in lieu thereof ``after the making of such 
     finding''.
       (b) Suspension of Performance.--Subsection (d) of such 
     section is amended to read as follows:
       ``(d)(1) A contractor awarded a Federal agency contract 
     may, during the period described in paragraph (4), begin 
     performance of the contract and engage in any related 
     activities that result in obligations being incurred by the 
     United States under the contract unless the contracting 
     officer responsible for the award of the contract withholds 
     authorization to proceed with performance of the contract.
       ``(2) The contracting officer may withhold an authorization 
     to proceed with performance of the contract during the period 
     described in paragraph (4) if the contracting officer 
     determines in writing that--
       ``(A) a protest is likely to be filed; and
       ``(B) the immediate performance of the contract is not in 
     the best interests of the United States.
       ``(3)(A) If the Federal agency awarding the contract 
     receives notice of a protest in accordance with this section 
     during the period described in paragraph (4)--
       ``(i) the contracting officer may not authorize performance 
     of the contract to begin while the protest is pending; or
       ``(ii) if contract performance authorization to proceed was 
     not withheld in accordance with paragraph (2) before receipt 
     of the notice, the contracting officer shall immediately 
     direct the contractor to cease performance under the contract 
     and to suspend any related activities that may result in 
     additional obligations being incurred by the United States 
     under that contract.
       ``(B) Performance and related activities suspended pursuant 
     to subparagraph (A)(ii) by reason of a protest may not be 
     resumed while the protest is pending.
       ``(C) The head of the procuring activity may authorize the 
     performance of the contract (notwithstanding a protest of 
     which the Federal agency has notice under this section)--
       ``(i) upon a written finding that--
       ``(I) performance of the contract is in the best interests 
     of the United States; or
       ``(II) urgent and compelling circumstances that 
     significantly affect interests of the United States will not 
     permit waiting for the decision of the Comptroller General 
     concerning the protest; and
       ``(ii) after the Comptroller General is notified of that 
     finding.
       ``(4) The period referred to in paragraphs (2) and (3)(A), 
     with respect to a contract, is the period beginning on the 
     date of the contract award and ending on the later of--
       ``(A) the date that is 10 days after the date of the 
     contract award; or
       ``(B) the date that is 5 days after--
       ``(i) the debriefing date offered to an unsuccessful 
     offeror for any debriefing that is requested and, when 
     requested, is required; or
       ``(ii) in the case of a contract for which no debriefing is 
     required, the date on which the unsuccessful offeror receives 
     the notification of contract award.''.

     SEC. 1403. DECISIONS ON PROTESTS.

       (a) Periods for Certain Actions.--Section 3554(a) of title 
     31, United States Code, is amended--
       (1) in paragraph (1), by striking out ``90 working days 
     from'' and inserting in lieu thereof ``125 days after'';
       (2) in paragraph (2), by striking out ``45 calendar days 
     from'' and inserting ``65 days after'';
       (3) by redesignating paragraph (3) as paragraph (4); and
       (4) by inserting after paragraph (2) the following new 
     paragraph (3):
       ``(3) An amendment to a protest that adds a new ground of 
     protest, if timely made, should be resolved, to the maximum 
     extent practicable, within the time limit established under 
     paragraph (1) of this subsection for final decision of the 
     initial protest. If an amended protest cannot be resolved 
     within such time limit, the Comptroller General may resolve 
     the amended protest through the express option under 
     paragraph (2) of this subsection.''.
       (b) GAO Recommendations on Protests.--
       (1) Implementation of recommendations.--Section 3554 of 
     title 31, United States Code, is amended--
       (A) in subsection (b), by adding at the end the following 
     new paragraph:
       ``(3) If the Federal agency fails to implement fully the 
     recommendations of the Comptroller General under this 
     subsection with respect to a solicitation for a contract or 
     an award or proposed award of a contract within 60 days after 
     receiving the recommendations, the head of the procuring 
     activity responsible for that contract shall report such 
     failure to the Comptroller General not later than 5 working 
     days after the end of such 60-day period.'';
       (B) by striking out subsection (c) and inserting in lieu 
     thereof the following:
       ``(c)(1) If the Comptroller General determines that a 
     solicitation for a contract or a proposed award or the award 
     of a contract does not comply with a statute or regulation, 
     the Comptroller General may recommend that the Federal agency 
     conducting the procurement pay to an appropriate interested 
     party the costs of--
       ``(A) filing and pursuing the protest, including reasonable 
     attorney's fees and consultant and expert witness fees; and
       ``(B) bid and proposal preparation.
       ``(2) No party (other than a small business concern (within 
     the meaning of section 3(a) of the Small Business Act)) may 
     be paid, pursuant to a recommendation made under the 
     authority of paragraph (1)--
       ``(A) costs for consultant and expert witness fees that 
     exceed the rates provided under section 504(b)(1)(A) of title 
     5 for expert witnesses; or
       ``(B) costs for attorney's fees that exceed the rates 
     provided for attorneys under section 504(b)(1)(A) of title 5.
       ``(3) If the Comptroller General recommends under paragraph 
     (1) that a Federal agency pay costs to an interested party, 
     the Federal agency shall--
       ``(A) pay the costs promptly; or
       ``(B) if the Federal agency does not make such payment, 
     promptly report to the Comptroller General the reasons for 
     the failure to follow the Comptroller General's 
     recommendation.
       ``(4) If the Comptroller General recommends under paragraph 
     (1) that a Federal agency pay costs to an interested party, 
     the Federal agency and the interested party shall attempt to 
     reach an agreement on the amount of the costs to be paid. If 
     the Federal agency and the interested party are unable to 
     agree on the amount to be paid, the Comptroller General may, 
     upon the request of the interested party, recommend to the 
     Federal agency the amount of the costs that the Federal 
     agency should pay.''; and
       (C) by striking out subsection (e) and inserting in lieu 
     thereof the following:
       ``(e)(1) The Comptroller General shall report promptly to 
     the Committee on Governmental Affairs and the Committee on 
     Appropriations of the Senate and to the Committee on 
     Government Operations and the Committee on Appropriations of 
     the House of Representatives any case in which a Federal 
     agency fails to implement fully a recommendation of the 
     Comptroller General under subsection (b) or (c). The report 
     shall include--
       ``(A) a comprehensive review of the pertinent procurement, 
     including the circumstances of the failure of the Federal 
     agency to implement a recommendation of the Comptroller 
     General; and
       ``(B) a recommendation regarding whether, in order to 
     correct an inequity or to preserve the integrity of the 
     procurement process, the Congress should consider--
       ``(i) private relief legislation;
       ``(ii) legislative rescission or cancellation of funds;
       ``(iii) further investigation by Congress; or
       ``(iv) other action.
       ``(2) Not later than January 31 of each year, the 
     Comptroller General shall transmit to the Congress a report 
     containing a summary of each instance in which a Federal 
     agency did not fully implement a recommendation of the 
     Comptroller General under subsection (b) or (c) during the 
     preceding year. The report shall also describe each instance 
     in which a final decision in a protest was not rendered 
     within 125 days after the date the protest is submitted to 
     the Comptroller General.''.
       (2) Requirement for payment in accordance with prior gao 
     determinations.--Costs to which the Comptroller General 
     declared an interested party to be entitled under section 
     3554 of title 31, United States Code, as in effect 
     immediately before the enactment of this Act, shall, if not 
     paid or otherwise satisfied by the Federal agency concerned 
     before the date of the enactment of this Act, be paid 
     promptly.

     SEC. 1404. REGULATIONS.

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

                PART II--PROTESTS IN THE FEDERAL COURTS

     SEC. 1421. NONEXCLUSIVITY OF REMEDIES.

       Section 3556 of title 31, United States Code, is amended by 
     striking out ``a district court of the United States or the 
     United States Claims Court'' in the first sentence and 
     inserting in lieu thereof ``the United States Court of 
     Federal Claims''.

     SEC. 1422. JURISDICTION OF THE UNITED STATES COURT OF FEDERAL 
                   CLAIMS.

       (a) Claims Against the United States and Bid Protests.--
     Section 1491 of title 28, United States Code, is amended--
       (1) by redesignating subsection (b) as subsection (e);
       (2) in subsection (a)--
       (A) by striking out ``(a)(1)'' and inserting in lieu 
     thereof ``(a) Claims Against the United States.--'';
       (B) in paragraph (2), by striking out ``(2) To'' and 
     inserting in lieu thereof ``(b) Remedy and Relief.--To''; and
       (C) by striking out paragraph (3); and
       (3) by inserting after subsection (b), as designated by 
     paragraph (2)(B), the following new subsection (c):
       ``(c) Bid Protests.--(1) The United States Court of Federal 
     Claims has jurisdiction to render judgment on an action by an 
     interested party objecting to a solicitation by a Federal 
     agency for bids or proposals for a proposed contract or to a 
     proposed award or the award of a contract. The court has 
     jurisdiction to entertain such an action without regard to 
     whether suit is instituted before or after the contract is 
     awarded.
       ``(2) To afford relief in such an action, the court may 
     award any relief that the court considers proper, including 
     declaratory and injunctive relief.
       ``(3) In exercising jurisdiction under this subsection, the 
     court shall give due regard to the interests of national 
     defense and national security and the need for expeditious 
     resolution of the action.
       ``(4) The district courts of the United States do not have 
     jurisdiction of any action referred to in paragraph (1).''.
       (b) Clerical Amendments.--
       (1) Section heading.--The heading of such section is 
     amended by inserting ``BID PROTESTS;'' after ``GENERALLY;''.
       (2) Table of sections.--The table of sections at the 
     beginning of chapter 91 of title 28, United States Code, is 
     amended by striking out the item relating to section 1491 and 
     inserting in lieu thereof the following:

``1491. Claims against United States generally; bid protests; actions 
              involving Tennessee Valley Authority.''.

    PART III--PROTESTS IN PROCUREMENTS OF AUTOMATIC DATA PROCESSING

     SEC. 1431. REVOCATION OF DELEGATIONS OF PROCUREMENT 
                   AUTHORITY.

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

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

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

     SEC. 1433. PERIODS FOR CERTAIN ACTIONS.

       (a) Suspension of Procurement Authority.--Section 111(f) of 
     the Federal Property and Administrative Services Act of 1949 
     (40 U.S.C. 759(f)) is amended--
       (1) in paragraph (2) by adding at the end the following new 
     subparagraph:
       ``(C) If, in the case of a preaward protest, the board 
     suspends the procurement authority of the Administrator or 
     the Administrator's delegation of procurement authority, the 
     Administrator or the delegate, as the case may be, may 
     continue with the procurement action up to, but not 
     including, the awarding of the contract if the Administrator 
     or the delegate, as the case may be, determines that it is in 
     the best interests of the United States to do so.''; and
       (2) in paragraph (3) by striking out subparagraph (A) and 
     inserting in lieu thereof the following:
       ``(A)(i) If, with respect to an award of a contract, the 
     board receives notice of a protest under this subsection 
     within the period described in clause (ii), the board shall, 
     at the request of an interested party, hold a hearing to 
     determine whether the board should suspend the procurement 
     authority of the Administrator or the Administrator's 
     delegation of procurement authority for the protested 
     procurement on an interim basis until the board can decide 
     the protest.
       ``(ii) The period referred to in clause (i) is the period 
     beginning on the date on which the contract is awarded and 
     ending on the date that is 10 days after the date of the 
     contract award or, if later, the date that is 5 days after--
       ``(I) the debriefing date offered to an unsuccessful 
     offeror for any debriefing that is requested and, when 
     requested, is required; or
       ``(II) in the case of a contract for which no debriefing is 
     required, the date on which the unsuccessful offeror receives 
     the notification of contract award.
       ``(iii) The board shall hold the requested hearing within 5 
     days after the date of the filing of the protest or, in the 
     case of a request for debriefing under the provisions of 
     section 2305(b)(5) of title 10, United States Code, or 
     section 303B(e) of this Act, within 5 days after the later of 
     the date of the filing of the protest or the date of the 
     debriefing.''.
       (b) Final Decision.--Paragraph (4)(B) of such section 
     111(f) is amended--
       (1) by striking out ``45 working days'' and inserting in 
     lieu thereof ``65 days''; and
       (2) by adding at the end the following: ``An amendment 
     which adds a new ground of protest should be resolved, to the 
     maximum extent practicable, within the time limits 
     established for resolution of the initial protest.''.

     SEC. 1434. DISMISSALS OF PROTESTS.

       Section 111(f)(4) of the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 759(f)(4)) is 
     amended by striking out subparagraph (C) and inserting in 
     lieu thereof the following:
       ``(C) The board may dismiss a protest that the board 
     determines--
       ``(i) is frivolous;
       ``(ii) has been brought in bad faith; or
       ``(iii) does not state on its face a valid basis for 
     protest.''.

     SEC. 1435. AWARD OF COSTS.

       Section 111(f)(5) is amended by striking out subparagraph 
     (C) and inserting in lieu thereof the following:
       ``(C) Whenever the board makes such a determination, it 
     may, in accordance with section 1304 of title 31, United 
     States Code, further declare an appropriate prevailing party 
     to be entitled to the cost of filing and pursuing the protest 
     (including reasonable attorney's fees and consultant and 
     expert witness fees), and bid and proposal preparation. 
     However, no party (other than a small business concern 
     (within the meaning of section 3(a) of the Small Business 
     Act)) may be declared entitled to costs for consultant and 
     expert witness fees that exceed the rates provided under 
     section 504(b)(1)(A) of title 5, United States Code, for 
     expert witnesses or to costs for attorney's fees that exceed 
     the rates provided for attorneys under section 504(b)(1)(A) 
     of title 5, United States Code.''.

     SEC. 1436. DISMISSAL AGREEMENTS.

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

     SEC. 1437. JURISDICTION OF DISTRICT COURTS.

       Section 111(f)(6)(C) of the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 759(f)(6)(C)) 
     is amended by striking out ``a district court of the United 
     States or''.

     SEC. 1438. MATTERS TO BE COVERED IN REGULATIONS.

       Section 111(f) of the Federal Property and Administrative 
     Services Act of 1949 (40 U.S.C. 759(f)) is amended by 
     striking out paragraph (8) and inserting in lieu thereof the 
     following:
       ``(7)(A) The board shall adopt and issue such rules and 
     procedures as may be necessary to the expeditious disposition 
     of protests filed under the authority of this subsection.
       ``(B) The procedures shall provide that, in the computation 
     of any period described in this subsection--
       ``(i) the day of the act, event, or default from which the 
     designated period of time begins to run not be included; and
       ``(ii) the last day after such act, event, or default be 
     included, unless--
       ``(I) such last day is a Saturday, a Sunday, or a legal 
     holiday; or
       ``(II) in the case of a filing of a paper at the board, 
     such last day is a day on which weather or other conditions 
     cause the closing of the board or Federal agency, in which 
     event the next day that is not a Saturday, Sunday, or legal 
     holiday shall be included.
       ``(C) The procedures may provide for electronic filing and 
     dissemination of documents and information required under 
     this subsection and in so providing shall consider the 
     ability of all parties to achieve electronic access to such 
     documents and records.
       ``(D) The procedures shall provide that if the board 
     expressly finds that a protest or a portion of a protest is 
     frivolous or has not been brought or pursued in good faith, 
     or that any person has willfully abused the board's process 
     during the course of a protest, the board may impose 
     appropriate procedural sanctions, including dismissal of the 
     protest.''.

     SEC. 1439. DEFINITIONS.

       (a) Protest.--Section 111(f)(9)(A) of the Federal Property 
     and Administrative Services Act of 1949 (40 U.S.C. 
     759(f)(9)(A)) is amended to read as follows:
       ``(A) the term `protest' means a written objection by an 
     interested party--
       ``(i) to a solicitation or other request by a Federal 
     agency for offers for a contract for the procurement of 
     property or services;
       ``(ii) to the cancellation of such a solicitation or other 
     request;
       ``(iii) to an award or proposed award of such a contract; 
     or
       ``(iv) to a termination or cancellation of an award of such 
     a contract, if the written objection contains an allegation 
     that the termination or cancellation is based in whole or in 
     part on improprieties concerning the award of the 
     contract;''.
       (b) Prevailing Party.--Section 111(f)(9) of such Act is 
     amended--
       (1) by striking out ``and'' at the end of subparagraph (A);
       (2) by striking out the period at the end of subparagraph 
     (B) and inserting in lieu thereof ``; and''; and
       (3) by adding at the end the following new subparagraph:
       ``(C) the term `prevailing party', with respect to a 
     determination of the board under paragraph (5)(B) that a 
     challenged action of a Federal agency violates a statute or 
     regulation or the conditions of a delegation of procurement 
     authority issued pursuant to this section, means a party that 
     demonstrated such violation.''.
               Subtitle E--Definitions and Other Matters

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 1501. DEFINITIONS.

       Section 2302 of title 10, United States Code, is amended--
       (1) by striking out paragraphs (3), (4), (5), and (7);
       (2) by redesignating paragraph (6) as paragraph (5); and
       (3) by inserting after paragraph (2) the following:
       ``(3) The terms `commercial item', `commercial component', 
     `full and open competition', `major system', 
     `nondevelopmental item', `procurement', `procurement system', 
     `responsible source', `standards', and `technical data', have 
     the meanings given such terms in section 4 of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403).
       ``(4) The term `simplified acquisition threshold' has the 
     meaning given that term in section 4 of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 403), except that, in the 
     case of any contract to be awarded and performed, or purchase 
     to be made, outside the United States in support of a 
     contingency operation, the term means an amount equal to two 
     times the amount specified for that term in section 4 of such 
     Act.''.

     SEC. 1502. DELEGATION OF PROCUREMENT FUNCTIONS.

       (a) Consolidation of Delegation Authority.--Section 2311 of 
     title 10, United States Code, is amended to read as follows:

     ``Sec. 2311. Delegation

       ``(a) In General.--Except to the extent expressly 
     prohibited by another provision of law, the head of an agency 
     may delegate, subject to his direction, to any other officer 
     or official of that agency, any power under this chapter.
       ``(b) Procurements For or With Other Agencies.--Subject to 
     subsection (a), to facilitate the procurement of property and 
     services covered by this chapter by each agency named in 
     section 2303 of this title for any other agency, and to 
     facilitate joint procurement by those agencies--
       ``(1) the head of an agency may, within his agency, 
     delegate functions and assign responsibilities relating to 
     procurement;
       ``(2) the heads of two or more agencies may by agreement 
     delegate procurement functions and assign procurement 
     responsibilities from one agency to another of those agencies 
     or to an officer or civilian employee of another of those 
     agencies; and
       ``(3) the heads of two or more agencies may create joint or 
     combined offices to exercise procurement functions and 
     responsibilities.
       ``(c) Approval of Terminations and Reductions of Joint 
     Acquisition Programs.--(1) The Secretary of Defense shall 
     prescribe regulations that prohibit each military department 
     participating in a joint acquisition program approved by the 
     Under Secretary of Defense for Acquisition and Technology 
     from terminating or substantially reducing its participation 
     in such program without the approval of the Under Secretary.
       ``(2) The regulations shall include the following 
     provisions:
       ``(A) A requirement that, before any such termination or 
     substantial reduction in participation is approved, the 
     proposed termination or reduction be reviewed by the Joint 
     Requirements Oversight Council of the Department of Defense.
       ``(B) A provision that authorizes the Under Secretary of 
     Defense for Acquisition and Technology to require a military 
     department approved for termination or substantial reduction 
     in participation in a joint acquisition program to continue 
     to provide some or all of the funding necessary for the 
     acquisition program to be continued in an efficient 
     manner.''.
       (b) Conforming Repeal.--(1) Section 2308 of title 10, 
     United States Code, is repealed.
       (2) The table of sections at the beginning of chapter 137 
     of such title is amended by striking out the item related to 
     section 2308.

     SEC. 1503. DETERMINATIONS AND DECISIONS.

       Section 2310 of title 10, United States Code, is amended to 
     read as follows:

     ``Sec. 2310. Determinations and decisions

       ``(a) Individual or Class Determinations and Decisions 
     Authorized.--Determinations and decisions required to be made 
     under this chapter by the head of an agency may be made for 
     an individual purchase or contract or for a class of 
     purchases or contracts. Such determinations and decisions are 
     final.
       ``(b) Written Findings Required.--(1) Each determination or 
     decision under section 2306(e)(1), 2307(e), or 2313(d)(2) of 
     this title shall be based on a written finding by the person 
     making the determination or decision. The finding shall set 
     out facts and circumstances that support the determination or 
     decision.
       ``(2) Each finding referred to in paragraph (1) shall be 
     final. The head of the agency making such finding shall 
     maintain a copy of the finding for not less than 6 years 
     after the date of the determination or decision.''.

     SEC. 1504. UNDEFINITIZED CONTRACTUAL ACTIONS: RESTRICTIONS.

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

     SEC. 1505. PRODUCTION SPECIAL TOOLING AND PRODUCTION SPECIAL 
                   TEST EQUIPMENT: CONTRACT TERMS AND CONDITIONS.

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

     SEC. 1506. REGULATIONS FOR BIDS.

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

     SEC. 1551. DEFINITIONS.

       Section 309(c) of the Federal Property and Administrative 
     Services Act of 1949 (41 U.S.C. 259(c)) is amended by 
     striking out ``and `supplies''' and inserting in lieu thereof 
     ```supplies', `commercial item', `commercial component', 
     `nondevelopmental item', and `simplified acquisition 
     threshold'''.

     SEC. 1552. DELEGATION OF PROCUREMENT FUNCTIONS.

       (a) Authority.--Title III of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 251 et seq.) 
     is amended--
       (1) by redesignating sections 309 and 310 as sections 312 
     and 313, respectively; and
       (2) by inserting after section 308 the following new 
     section 309:


                              ``delegation

       ``Sec. 309. (a) In General.--Except to the extent expressly 
     prohibited by another provision of law, an agency head may 
     delegate, subject to his direction, to any other officer or 
     official of that agency, any power under this title.
       ``(b) Procurements For or With Other Agencies.--Subject to 
     subsection (a), to facilitate the procurement of property and 
     services covered by this title by each executive agency for 
     any other executive agency, and to facilitate joint 
     procurement by those executive agencies--
       ``(1) an agency head may, within his executive agency, 
     delegate functions and assign responsibilities relating to 
     procurement;
       ``(2) the heads of two or more executive agencies may by 
     agreement delegate procurement functions and assign 
     procurement responsibilities from one executive agency to 
     another of those executive agencies or to an officer or 
     civilian employee of another of those executive agencies; and
       ``(3) the heads of two or more executive agencies may 
     create joint or combined offices to exercise procurement 
     functions and responsibilities.''.
       (b) Clerical Amendment.--The table of contents in the first 
     section of such Act is amended by striking out the items 
     relating to sections 309 and 310 and inserting in lieu 
     thereof the following:

``Sec. 309. Delegation.
``Sec. 312. Definitions.
``Sec. 313. Statutes not applicable.''.

     SEC. 1553. DETERMINATIONS AND DECISIONS.

       (a) In General.--Title III of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 251 et seq.), 
     as amended by section 1552, is further amended by inserting 
     after section 309 the following new section 310:


                     ``determinations and decisions

       ``Sec. 310. (a) Individual or Class Determinations and 
     Decisions Authorized.--Determinations and decisions required 
     to be made under this title by an agency head may be made for 
     an individual purchase or contract or for a class of 
     purchases or contracts. Such determinations and decisions are 
     final.
       ``(b) Written Findings Required.--(1) Each determination 
     under section 305(e) shall be based on a written finding by 
     the person making the determination or decision. The finding 
     shall set out facts and circumstances that support the 
     determination or decision.
       ``(2) Each finding referred to in paragraph (1) shall be 
     final. The agency head making such finding shall maintain a 
     copy of the finding for not less than 6 years after the date 
     of the determination or decision.''.
       (b) Clerical Amendment.--The table of contents in the first 
     section of such Act, as amended by section 1552, is further 
     amended by inserting after the item relating to section 309 
     the following:

``Sec. 310. Determinations and decisions.''.

     SEC. 1554. COOPERATIVE PURCHASING.

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

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 2001. CONTRACT FINANCING.

       (a) Reorganization of Principal Authority Provision.--
     Section 2307 of title 10, United States Code, is amended--
       (1) by striking out the section heading and inserting in 
     lieu thereof the following:

     ``Sec. 2307. Contract financing'';

       (2) by striking out ``(a) The head of an agency'' and 
     inserting in lieu thereof ``(b) Payment Authority.--The head 
     of an agency'';
       (3) by striking out ``(b) Payments'' and inserting in lieu 
     thereof ``(d) Payment Amount.--Payments'';
       (4) by striking out ``(c) Advance payments'' and inserting 
     in lieu thereof ``(e) Security for Advance Payments.--Advance 
     payments'';
       (5) by striking out ``(d)(1) The Secretary of Defense'' and 
     inserting in lieu thereof ``(f) Conditions for Progress 
     Payments.--(1) The Secretary of Defense''; and
       (6) by striking out ``(e)(1) In any case'' and inserting in 
     lieu thereof ``(h) Action in Case of Fraud.--(1) In any 
     case''.
       (b) Financing Policy.--Such section, as amended by 
     subsection (a), is further amended by inserting after the 
     section heading the following new subsection (a):
       ``(a) Policy.--Payments authorized under this section and 
     made for financing purposes should be made periodically or, 
     when appropriate, on an advance basis and should be so made 
     in a timely manner to facilitate contract performance while 
     protecting the security interests of the Government. 
     Government financing shall be provided only to the extent 
     necessary to ensure prompt and efficient performance and only 
     after the availability of private financing is considered. A 
     contractor's use of funds received as contract financing and 
     the contractor's financial condition shall be monitored. If 
     the contractor is a small business concern, special attention 
     shall be given to meeting the contractor's financial need.''.
       (c) Performance-Based Payments.--Such section, as amended 
     by subsection (a), is further amended by inserting after 
     subsection (b) the following new subsection (c):
       ``(c) Performance-Based Payments.--Whenever practicable, 
     payments under subsection (b) shall be made on any of the 
     following bases:
       ``(1) Performance measured by objective, quantifiable 
     methods such as receipt of items by the Federal Government, 
     work measurement, or statistical process controls.
       ``(2) Accomplishment of events defined in the program 
     management plan.
       ``(3) Other quantifiable measures of results.''.
       (d) Terminology Correction.--Such section, as amended by 
     subsection (a)(2), is further amended in subsection (b)(2) by 
     striking out ``bid''.
       (e) Effective Date of Lien Related to Advance Payments.--
     Such section, as amended by subsection (a)(4), is further 
     amended in subsection (e) by inserting before the period at 
     the end of the third sentence the following: ``and is 
     effective immediately upon the first advancement of funds 
     without filing, notice, or any other action by the United 
     States''.
       (f) Conditions for Progress Payments.--Such section, as 
     amended by subsection (a)(5), is further amended in 
     subsection (f)--
       (1) in the first sentence of paragraph (1), by striking out 
     ``work, which'' and all that follows through ``accomplished'' 
     and inserting in lieu thereof ``work accomplished that meets 
     standards established under the contract''; and
       (2) by striking out paragraph (3) and inserting in lieu 
     thereof the following:
       ``(3) This subsection applies to a contract for an amount 
     equal to or greater than the simplified acquisition 
     threshold.''.
       (g) Navy Contracts.--Such section, as amended by subsection 
     (a)(5), is further amended by inserting after subsection (f) 
     the following new subsection (g):
       ``(g) Certain Navy Contracts.--(1) The Secretary of the 
     Navy shall provide that the rate for progress payments on any 
     contract awarded by the Secretary for repair, maintenance, or 
     overhaul of a naval vessel shall be not less than--
       ``(A) 95 percent, in the case of firms considered to be 
     small businesses; and
       ``(B) 90 percent, in the case of all other firms.
       ``(2) The Secretary of the Navy may advance to private 
     salvage companies such funds as the Secretary considers 
     necessary to provide for the immediate financing of salvage 
     operations. Advances under this paragraph shall be made on 
     terms that the Secretary considers adequate for the 
     protection of the United States.
       ``(3) The Secretary of the Navy shall ensure that, when 
     partial, progress, or other payments are made under a 
     contract for construction or conversion of a naval vessel, 
     the United States is secured by a lien upon work in progress 
     and on property acquired for performance of the contract on 
     account of all payments so made. The lien is paramount to all 
     other liens.''.
       (h) Relationship to Prompt Payment Requirements.--Section 
     2307(f) of title 10, United States Code, as amended by 
     subsection (f), is not intended to impair or modify 
     procedures required by the provisions of chapter 39 of title 
     31, United States Code, and the regulations issued pursuant 
     to such provisions of law, that relate to progress payment 
     requests, as such procedures are in effect on the date of the 
     enactment of this Act.
       (i) Conforming and Clerical Amendments.--
       (1) Cross reference.--Such section, as amended by 
     subsection (a), is further amended in subsections (d) and (e) 
     by striking out ``subsection (a)'' and inserting in lieu 
     thereof ``subsection (b)''.
       (2) Table of contents.--The table of sections at the 
     beginning of chapter 137 of title 10, United States Code, is 
     amended by striking out the item relating to section 2307 and 
     inserting in lieu thereof the following:

``2307. Contract financing.''.

       (j) Repeal of Superseded Provisions.--
       (1) Progress payments under certain navy contracts.--
       (A) Repeal.--Section 7312 of title 10, United States Code, 
     is repealed.
       (B) Clerical amendment.--The table of sections at the 
     beginning of chapter 633 of such title is amended by striking 
     out the item relating to section 7312.
       (2) Advancement of payments for navy salvage operations.--
       (A) Repeal.--Section 7364 of such title is repealed.
       (B) Clerical amendment.--The table of sections at the 
     beginning of chapter 637 of such title is amended by striking 
     out the item relating to section 7364.
       (3) Partial payments under navy contracts.--
       (A) Repeal.--Section 7521 of such title is repealed.
       (B) Clerical amendment.--The table of sections at the 
     beginning of chapter 645 of such title is amended by striking 
     out the item relating to section 7521.

     SEC. 2002. CONTRACTS: VOUCHERING PROCEDURES.

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

     SEC. 2051. CONTRACT FINANCING.

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


                        ``contract financing'';

       (2) by striking out ``(a) Any executive agency'' and 
     inserting in lieu thereof ``(b) Payment Authority.--Any 
     executive agency'';
       (3) by striking out ``(b) Payments'' and inserting in lieu 
     thereof ``(d) Payment Amount.--Payments''; and
       (4) by striking out ``(c) Advance payments'' and inserting 
     in lieu thereof ``(e) Security for Advance Payments.--Advance 
     payments''.
       (b) Financing Policy.--Such section, as amended by 
     subsection (a), is further amended by inserting after the 
     section heading the following new subsection (a):
       ``(a) Policy.--Payments authorized under this section and 
     made for financing purposes should be made periodically or, 
     when appropriate, on an advance basis and should be so made 
     in a timely manner to facilitate contract performance while 
     protecting the security interests of the Government. 
     Government financing shall be provided only to the extent 
     necessary to ensure prompt and efficient performance and only 
     after the availability of private financing is considered. A 
     contractor's use of funds received as contract financing and 
     the contractor's financial condition shall be monitored. If 
     the contractor is a small business concern, special attention 
     shall be given to meeting the contractor's financial need.''.
       (c) Performance-Based Payments.--Such section, as amended 
     by subsection (a), is further amended by inserting after 
     subsection (b) the following new subsection (c):
       ``(c) Performance-Based Payments.--Whenever practicable, 
     payments under subsection (b) shall be made on any of the 
     following bases:
       ``(1) Performance measured by objective, quantifiable 
     methods such as receipt of items by the Federal Government, 
     work measurement, or statistical process controls.
       ``(2) Accomplishment of events defined in the program 
     management plan.
       ``(3) Other quantifiable measures of results.''.
       (d) Terminology Correction.--Such section, as amended by 
     subsection (a)(2), is further amended in subsection (b)(2) by 
     striking out ``bid''.
       (e) Effective Date of Lien Related to Advance Payments.--
     Such section, as amended by subsection (a)(4), is further 
     amended in subsection (e) by inserting before the period at 
     the end of the third sentence the following: ``and is 
     effective immediately upon the first advancement of funds 
     without filing, notice, or any other action by the United 
     States''.
       (f) Revision of Civilian Agency Provision To Ensure Uniform 
     Requirements for Progress Payments.--
       (1) In general.--Such section, as amended by subsection 
     (a), is further amended by adding at the end the following:
       ``(f) Conditions for Progress Payments.--(1) The agency 
     head shall ensure that any payment for work in progress 
     (including materials, labor, and other items) under a 
     contract of an executive agency that provides for such 
     payments is commensurate with the work accomplished that 
     meets standards established under the contract. The 
     contractor shall provide such information and evidence as the 
     agency head determines necessary to permit the agency head to 
     carry out the preceding sentence.
       ``(2) The agency head shall ensure that progress payments 
     referred to in paragraph (1) are not made for more than 80 
     percent of the work accomplished under the contract so long 
     as the agency head has not made the contractual terms, 
     specifications, and price definite.
       ``(3) This subsection applies to a contract for an amount 
     equal to or greater than the simplified acquisition 
     threshold.
       ``(g) Action in Case of Fraud.--(1) In any case in which 
     the remedy coordination official of an executive agency finds 
     that there is substantial evidence that the request of a 
     contractor for advance, partial, or progress payment under a 
     contract awarded by that executive agency is based on fraud, 
     the remedy coordination official shall recommend that the 
     agency head reduce or suspend further payments to such 
     contractor.
       ``(2) An agency head receiving a recommendation under 
     paragraph (1) in the case of a contractor's request for 
     payment under a contract shall determine whether there is 
     substantial evidence that the request is based on fraud. Upon 
     making such a determination, the agency head may reduce or 
     suspend further payments to the contractor under such 
     contract.
       ``(3) The extent of any reduction or suspension of payments 
     by an agency head under paragraph (2) on the basis of fraud 
     shall be reasonably commensurate with the anticipated loss to 
     the United States resulting from the fraud.
       ``(4) A written justification for each decision of the 
     agency head whether to reduce or suspend payments under 
     paragraph (2), and for each recommendation received by the 
     agency head in connection with such decision, shall be 
     prepared and be retained in the files of the executive 
     agency.
       ``(5) Each agency head shall prescribe procedures to ensure 
     that, before the agency head decides to reduce or suspend 
     payments in the case of a contractor under paragraph (2), the 
     contractor is afforded notice of the proposed reduction or 
     suspension and an opportunity to submit matters to the head 
     of the agency in response to such proposed reduction or 
     suspension.
       ``(6) Not later than 180 days after the date on which an 
     agency head reduces or suspends payments to a contractor 
     under paragraph (2), the remedy coordination official of the 
     executive agency shall--
       ``(A) review the determination of fraud on which the 
     reduction or suspension is based; and
       ``(B) transmit a recommendation to the agency head whether 
     the suspension or reduction should continue.
       ``(7) Each agency head who receives recommendations made by 
     a remedy coordination official of the executive agency to 
     reduce or suspend payments under paragraph (2) during a 
     fiscal year shall prepare for such year a report that 
     contains the recommendations, the actions taken on the 
     recommendations and the reasons for such actions, and an 
     assessment of the effects of such actions on the Federal 
     Government. Any such report shall be available to any Member 
     of Congress upon request.
       ``(8) An agency head may not delegate responsibilities 
     under this subsection to any person in a position below level 
     IV of the Executive Schedule.
       ``(9) In this subsection, the term `remedy coordination 
     official', with respect to an executive agency, means the 
     person or entity in that executive agency who coordinates 
     within that executive agency the administration of criminal, 
     civil, administrative, and contractual remedies resulting 
     from investigations of fraud or corruption related to 
     procurement activities.''.
       (2) Relationship to prompt payment requirements.--The 
     amendment made by paragraph (1) is not intended to impair or 
     modify procedures required by the provisions of chapter 39 of 
     title 31, United States Code, and the regulations issued 
     pursuant to such provisions of law, that relate to progress 
     payment requests, as such procedures are in effect on the 
     date of the enactment of this Act.
       (g) Conforming and Clerical Amendments.--
       (1) Reference.--Section 305 of the Federal Property and 
     Administrative Services Act of 1949, as amended by subsection 
     (a), is further amended in subsections (d) and (e) by 
     striking out ``subsection (a)'' and inserting in lieu thereof 
     ``subsection (b)''.
       (2) Table of contents.--The table of contents in the first 
     section of such Act is amended by striking out the item 
     relating to section 305 and inserting in lieu thereof the 
     following:

``Sec. 305. Contract financing.''.
                      Subtitle B--Cost Principles

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 2101. ALLOWABLE CONTRACT COSTS.

       (a) Unallowability of Costs To Influence Local Legislative 
     Bodies.--Subsection (e)(1)(B) of section 2324 of title 10, 
     United States Code, is amended by striking out ``or a State 
     legislature'' and inserting in lieu thereof ``, a State 
     legislature, or a legislative body of a political subdivision 
     of a State''.
       (b) Comptroller General Evaluation.--Section 2324 of such 
     title is amended by striking out subsection (l).
       (c) Covered Contract Defined.--Subsection (m) of such 
     section is amended to read as follows:
       ``(l)(1) In this section, the term `covered contract' means 
     a contract for an amount in excess of $500,000 that is 
     entered into by the Department of Defense, except that such 
     term does not include a fixed-price contract without cost 
     incentives.
       ``(2) Effective on October 1 of each year that is divisible 
     by 5, the amount set forth in paragraph (1) shall be adjusted 
     to the amount that is equal to the fiscal year 1994 constant 
     dollar value of the amount set forth. An amount, as so 
     adjusted, that is not evenly divisible by $50,000 shall be 
     rounded to the nearest multiple of $50,000. In the case of an 
     amount that is evenly divisible by $25,000 but is not evenly 
     divisible by $50,000, the amount shall be rounded to the next 
     higher multiple of $50,000.''.

     SEC. 2102. CONTRACT PROFIT CONTROLS DURING EMERGENCY PERIODS.

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

     SEC. 2151. ALLOWABLE CONTRACT COSTS.

       (a) Revision of Civilian Agency Provision To Ensure Uniform 
     Treatment of Contract Costs.--Section 306 of the Federal 
     Property and Administrative Services Act of 1949 (41 U.S.C. 
     256) is amended to read as follows:


                           ``allowable costs

       ``Sec. 306. (a) Indirect Cost That Violates a FAR Cost 
     Principle.--The head of an executive agency shall require 
     that a covered contract provide that if the contractor 
     submits to the executive agency a proposal for settlement of 
     indirect costs incurred by the contractor for any period 
     after such costs have been accrued and if that proposal 
     includes the submission of a cost which is unallowable 
     because the cost violates a cost principle in the Federal 
     Acquisition Regulation or an executive agency's supplement to 
     the Federal Acquisition Regulation, the cost shall be 
     disallowed.
       ``(b) Penalty for Violation of Cost Principle.--(1) If the 
     agency head determines that a cost submitted by a contractor 
     in its proposal for settlement is expressly unallowable under 
     a cost principle referred to in subsection (a) that defines 
     the allowability of specific selected costs, the agency head 
     shall assess a penalty against the contractor in an amount 
     equal to--
       ``(A) the amount of the disallowed cost allocated to 
     covered contracts for which a proposal for settlement of 
     indirect costs has been submitted; plus
       ``(B) interest (to be computed based on regulations issued 
     by the agency head) to compensate the United States for the 
     use of any funds which a contractor has been paid in excess 
     of the amount to which the contractor was entitled.
       ``(2) If the agency head determines that a proposal for 
     settlement of indirect costs submitted by a contractor 
     includes a cost determined to be unallowable in the case of 
     such contractor before the submission of such proposal, the 
     agency head shall assess a penalty against the contractor in 
     an amount equal to two times the amount of the disallowed 
     cost allocated to covered contracts for which a proposal for 
     settlement of indirect costs has been submitted.
       ``(c) Waiver of Penalty.--In accordance with the Federal 
     Acquisition Regulation, the agency head may waive a penalty 
     under subsection (b) in the case of a contractor's proposal 
     for settlement of indirect costs when--
       ``(1) the contractor withdraws the proposal before the 
     formal initiation of an audit of the proposal by the Federal 
     Government and resubmits a revised proposal;
       ``(2) the amount of unallowable costs subject to the 
     penalty is insignificant; or
       ``(3) the contractor demonstrates, to the contracting 
     officer's satisfaction, that--
       ``(A) it has established appropriate policies and personnel 
     training and an internal control and review system that 
     provide assurances that unallowable costs subject to 
     penalties are precluded from being included in the 
     contractor's proposal for settlement of indirect costs; and
       ``(B) the unallowable costs subject to the penalty were 
     inadvertently incorporated into the proposal.
       ``(d) Applicability of Contract Disputes Procedure to 
     Disallowance of Cost and Assessment of Penalty.--An action of 
     an agency head under subsection (a) or (b)--
       ``(1) shall be considered a final decision for the purposes 
     of section 6 of the Contract Disputes Act of 1978 (41 U.S.C. 
     605); and
       ``(2) is appealable in the manner provided in section 7 of 
     such Act.
       ``(e) Specific Costs Not Allowable.--(1) The following 
     costs are not allowable under a covered contract:
       ``(A) Costs of entertainment, including amusement, 
     diversion, and social activities, and any costs directly 
     associated with such costs (such as tickets to shows or 
     sports events, meals, lodging, rentals, transportation, and 
     gratuities).
       ``(B) Costs incurred to influence (directly or indirectly) 
     legislative action on any matter pending before Congress, a 
     State legislature, or a legislative body of a political 
     subdivision of a State.
       ``(C) Costs incurred in defense of any civil or criminal 
     fraud proceeding or similar proceeding (including filing of 
     any false certification) brought by the United States where 
     the contractor is found liable or had pleaded nolo contendere 
     to a charge of fraud or similar proceeding (including filing 
     of a false certification).
       ``(D) Payments of fines and penalties resulting from 
     violations of, or failure to comply with, Federal, State, 
     local, or foreign laws and regulations, except when incurred 
     as a result of compliance with specific terms and conditions 
     of the contract or specific written instructions from the 
     contracting officer authorizing in advance such payments in 
     accordance with the Federal Acquisition Regulation.
       ``(E) Costs of membership in any social, dining, or country 
     club or organization.
       ``(F) Costs of alcoholic beverages.
       ``(G) Contributions or donations, regardless of the 
     recipient.
       ``(H) Costs of advertising designed to promote the 
     contractor or its products.
       ``(I) Costs of promotional items and memorabilia, including 
     models, gifts, and souvenirs.
       ``(J) Costs for travel by commercial aircraft which exceed 
     the amount of the standard commercial fare.
       ``(K) Costs incurred in making any payment (commonly known 
     as a `golden parachute payment') which is--
       ``(i) in an amount in excess of the normal severance pay 
     paid by the contractor to an employee upon termination of 
     employment; and
       ``(ii) is paid to the employee contingent upon, and 
     following, a change in management control over, or ownership 
     of, the contractor or a substantial portion of the 
     contractor's assets.
       ``(L) Costs of commercial insurance that protects against 
     the costs of the contractor for correction of the 
     contractor's own defects in materials or workmanship.
       ``(M) Costs of severance pay paid by the contractor to 
     foreign nationals employed by the contractor under a service 
     contract performed outside the United States, to the extent 
     that the amount of severance pay paid in any case exceeds the 
     amount paid in the industry involved under the customary or 
     prevailing practice for firms in that industry providing 
     similar services in the United States, as determined in 
     accordance with the Federal Acquisition Regulation.
       ``(N) Costs of severance pay paid by the contractor to a 
     foreign national employed by the contractor under a service 
     contract performed in a foreign country if the termination of 
     the employment of the foreign national is the result of the 
     closing of, or the curtailment of activities at, a United 
     States facility in that country at the request of the 
     government of that country.
       ``(O) Costs incurred by a contractor in connection with any 
     criminal, civil, or administrative proceeding commenced by 
     the United States or a State, to the extent provided in 
     subsection (k).
       ``(2)(A) Subject to the availability of appropriations, the 
     head of an executive agency, in awarding a covered contract, 
     may waive in accordance with the Federal Acquisition 
     Regulation the application of the provisions of paragraphs 
     (1)(M) and (1)(N) to that contract if the agency head 
     determines that--
       ``(i) the application of such provisions to the contract 
     would adversely affect the continuation of a program, 
     project, or activity that provides significant support 
     services for employees of the executive agency posted outside 
     the United States;
       ``(ii) the contractor has taken (or has established plans 
     to take) appropriate actions within the contractor's control 
     to minimize the amount and number of incidents of the payment 
     of severance pay by the contractor to employees under the 
     contract who are foreign nationals; and
       ``(iii) the payment of severance pay is necessary in order 
     to comply with a law that is generally applicable to a 
     significant number of businesses in the country in which the 
     foreign national receiving the payment performed services 
     under the contract or is necessary to comply with a 
     collective bargaining agreement.
       ``(B) The head of the executive agency concerned shall 
     include in the solicitation for a covered contract a 
     statement indicating--
       ``(i) that a waiver has been granted under subparagraph (A) 
     for the contract; or
       ``(ii) whether the agency head will consider granting such 
     a waiver, and, if the agency head will consider granting a 
     waiver, the criteria to be used in granting the waiver.
       ``(C) The agency head shall make the final determination 
     regarding whether to grant a waiver under subparagraph (A) 
     with respect to a covered contract before award of the 
     contract.
       ``(3) The head of each executive agency shall implement 
     this section with respect to contracts of that executive 
     agency in accordance with the Federal Acquisition Regulation. 
     The provisions of the Federal Acquisition applicable to the 
     implementation of this section may include definitions, 
     exclusions, limitations, and qualifications.
       ``(f) Required Regulations.--(1) The Federal Acquisition 
     Regulation referred to in section 25(c)(1) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 421(c)(1)) shall 
     contain provisions on the allowability of contractor costs. 
     Such provisions shall define in detail and in specific terms 
     those costs which are unallowable, in whole or in part, under 
     covered contracts. The regulations shall, at a minimum, 
     clarify the cost principles applicable to contractor costs of 
     the following:
       ``(A) Air shows.
       ``(B) Membership in civic, community, and professional 
     organizations.
       ``(C) Recruitment.
       ``(D) Employee morale and welfare.
       ``(E) Actions to influence (directly or indirectly) 
     executive branch action on regulatory and contract matters 
     (other than costs incurred in regard to contract proposals 
     pursuant to solicited or unsolicited bids).
       ``(F) Community relations.
       ``(G) Dining facilities.
       ``(H) Professional and consulting services, including legal 
     services.
       ``(I) Compensation.
       ``(J) Selling and marketing.
       ``(K) Travel.
       ``(L) Public relations.
       ``(M) Hotel and meal expenses.
       ``(N) Expense of corporate aircraft.
       ``(O) Company-furnished automobiles.
       ``(P) Advertising.
       ``(2) The Federal Acquisition Regulation shall require that 
     a contracting officer not resolve any questioned costs until 
     the contracting officer has obtained--
       ``(A) adequate documentation with respect to such costs; 
     and
       ``(B) the opinion of the executive agency's contract 
     auditor on the allowability of such costs.
       ``(3) The Federal Acquisition Regulation shall provide 
     that, to the maximum extent practicable, an executive 
     agency's contract auditor be present at any negotiation or 
     meeting with the contractor regarding a determination of the 
     allowability of indirect costs of the contractor.
       ``(4) The Federal Acquisition Regulation shall require that 
     all categories of costs designated in the report of an 
     executive agency's contract auditor as questioned with 
     respect to a proposal for settlement be resolved in such a 
     manner that the amount of the individual questioned costs 
     that are paid will be reflected in the settlement.
       ``(g) Applicability of Required Regulations to 
     Subcontractors.--The regulations prescribed to carry out 
     subsections (e) and (f)(1) shall require, to the maximum 
     extent practicable, that such regulations apply to all 
     subcontractors of a covered contract.
       ``(h) Contractor Certification Required.--(1) A proposal 
     for settlement of indirect costs applicable to a covered 
     contract shall include a certification by an official of the 
     contractor that, to the best of the certifying official's 
     knowledge and belief, all indirect costs included in the 
     proposal are allowable. Any such certification shall be in a 
     form prescribed by the agency head concerned.
       ``(2) The agency head concerned may, in an exceptional 
     case, waive the requirement for certification under paragraph 
     (1) in the case of any contract if the agency head--
       ``(A) determines in such case that it would be in the 
     interest of the United States to waive such certification; 
     and
       ``(B) states in writing the reasons for that determination 
     and makes such determination available to the public.
       ``(i) Penalties for Submission of Cost Known as Not 
     Allowable.--The submission to an executive agency of a 
     proposal for settlement of costs for any period after such 
     costs have been accrued that includes a cost that is 
     expressly specified by statute or regulation as being 
     unallowable, with the knowledge that such cost is 
     unallowable, shall be subject to the provisions of section 
     287 of title 18, United States Code, and section 3729 of 
     title 31, United States Code.
       ``(j) Contractor To Have Burden of Proof.--In a proceeding 
     before a board of contract appeals, the United States Court 
     of Federal Claims, or any other Federal court in which the 
     reasonableness of indirect costs for which a contractor seeks 
     reimbursement from the United States is in issue, the burden 
     of proof shall be upon the contractor to establish that those 
     costs are reasonable.
       ``(k) Proceeding Costs Not Allowable.--(1) Except as 
     otherwise provided in this subsection, costs incurred by a 
     contractor in connection with any criminal, civil, or 
     administrative proceeding commenced by the United States or a 
     State are not allowable as reimbursable costs under a covered 
     contract if the proceeding (A) relates to a violation of, or 
     failure to comply with, a Federal or State statute or 
     regulation, and (B) results in a disposition described in 
     paragraph (2).
       ``(2) A disposition referred to in paragraph (1)(B) is any 
     of the following:
       ``(A) In the case of a criminal proceeding, a conviction 
     (including a conviction pursuant to a plea of nolo 
     contendere) by reason of the violation or failure referred to 
     in paragraph (1).
       ``(B) In the case of a civil or administrative proceeding 
     involving an allegation of fraud or similar misconduct, a 
     determination of contractor liability on the basis of the 
     violation or failure referred to in paragraph (1).
       ``(C) In the case of any civil or administrative 
     proceeding, the imposition of a monetary penalty by reason of 
     the violation or failure referred to in paragraph (1).
       ``(D) A final decision--
       ``(i) to debar or suspend the contractor,
       ``(ii) to rescind or void the contract, or
       ``(iii) to terminate the contract for default,
     by reason of the violation or failure referred to in 
     paragraph (1).
       ``(E) A disposition of the proceeding by consent or 
     compromise if such action could have resulted in a 
     disposition described in subparagraph (A), (B), (C), or (D).
       ``(3) In the case of a proceeding referred to in paragraph 
     (1) that is commenced by the United States and is resolved by 
     consent or compromise pursuant to an agreement entered into 
     by a contractor and the United States, the costs incurred by 
     the contractor in connection with such proceeding that are 
     otherwise not allowable as reimbursable costs under such 
     paragraph may be allowed to the extent specifically provided 
     in such agreement.
       ``(4) In the case of a proceeding referred to in paragraph 
     (1) that is commenced by a State, the agency head that 
     awarded the covered contract involved in the proceeding may 
     allow the costs incurred by the contractor in connection with 
     such proceeding as reimbursable costs if the agency head 
     determines, under regulations prescribed by such agency head, 
     that the costs were incurred as a result of (A) a specific 
     term or condition of the contract, or (B) specific written 
     instructions of the agency.
       ``(5)(A) Except as provided in subparagraph (C), costs 
     incurred by a contractor in connection with a criminal, 
     civil, or administrative proceeding commenced by the United 
     States or a State in connection with a covered contract may 
     be allowed as reimbursable costs under the contract if such 
     costs are not disallowable under paragraph (1), but only to 
     the extent provided in subparagraph (B).
       ``(B)(i) The amount of the costs allowable under 
     subparagraph (A) in any case may not exceed the amount equal 
     to 80 percent of the amount of the costs incurred, to the 
     extent that such costs are determined to be otherwise 
     allowable and allocable under the Federal Acquisition 
     Regulations.
       ``(ii) Regulations issued for the purpose of clause (i) 
     shall provide for appropriate consideration of the complexity 
     of procurement litigation, generally accepted principles 
     governing the award of legal fees in civil actions involving 
     the United States as a party, and such other factors as may 
     be appropriate.
       ``(C) In the case of a proceeding referred to in 
     subparagraph (A), contractor costs otherwise allowable as 
     reimbursable costs under this paragraph are not allowable if 
     (i) such proceeding involves the same contractor misconduct 
     alleged as the basis of another criminal, civil, or 
     administrative proceeding, and (ii) the costs of such other 
     proceeding are not allowable under paragraph (1).
       ``(6) In this subsection:
       ``(A) The term `proceeding' includes an investigation.
       ``(B) The term `costs', with respect to a proceeding--
       ``(i) means all costs incurred by a contractor, whether 
     before or after the commencement of any such proceeding; and
       ``(ii) includes--
       ``(I) administrative and clerical expenses;
       ``(II) the cost of legal services, including legal services 
     performed by an employee of the contractor;
       ``(III) the cost of the services of accountants and 
     consultants retained by the contractor; and
       ``(IV) the pay of directors, officers, and employees of the 
     contractor for time devoted by such directors, officers, and 
     employees to such proceeding.
       ``(C) The term `penalty' does not include restitution, 
     reimbursement, or compensatory damages.
       ``(l) Covered Contract Defined.--(1) In this section, the 
     term `covered contract' means a contract for an amount in 
     excess of $500,000 that is entered into by an executive 
     agency, except that such term does not include a fixed-price 
     contract without cost incentives.
       ``(2) Effective on October 1 of each year that is divisible 
     by 5, the amount set forth in paragraph (1) shall be adjusted 
     to the amount that is equal to the fiscal year 1994 constant 
     dollar value of the amount set forth. An amount, as so 
     adjusted, that is not evenly divisible by $50,000 shall be 
     rounded to the nearest multiple of $50,000. In the case of an 
     amount that is evenly divisible by $25,000 but is not evenly 
     divisible by $50,000, the amount shall be rounded to the next 
     higher multiple of $50,000.''.
       (b) Clerical Amendment.--The table of contents in the first 
     section of such Act is amended by striking out the item 
     relating to section 306 and inserting in lieu thereof the 
     following:

``Sec. 306. Allowable costs.''.

                    PART III--ACQUISITIONS GENERALLY

     SEC. 2191. TRAVEL EXPENSES OF GOVERNMENT CONTRACTORS.

       Section 24 of the Office of Federal Procurement Policy Act 
     (41 U.S.C. 420) is repealed.

     SEC. 2192. UNALLOWABILITY OF ENTERTAINMENT COSTS UNDER 
                   COVERED CONTRACTS.

       Not later than 90 days after the date of the enactment of 
     this Act, the Federal Acquisition Regulatory Council shall 
     amend the cost principle in the Federal Acquisition 
     Regulation that is set out in section 31.205-14 of title 48, 
     Code of Federal Regulations, relating to unallowability of 
     entertainment costs--
       (1) by inserting in the cost principle a statement that 
     costs made specifically unallowable under that cost principle 
     are not allowable under any other cost principle; and
       (2) by striking out ``(but see 31.205-1 and 31.205-13)''.
                Subtitle C--Audit and Access to Records

                  PART I--ARMED SERVICES ACQUISITIONS

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

       (a) Authority.--
       (1) In general.--Section 2313 of title 10, United States 
     Code, is amended to read as follows:

     ``Sec. 2313. Examination of records of contractor

       ``(a) Agency Authority.--The head of an agency, acting 
     through an authorized representative--
       ``(1) is entitled to inspect the plant and audit the 
     records of--
       ``(A) a contractor performing a cost-reimbursement, 
     incentive, time-and-materials, labor-hour, or price-
     redeterminable contract, or any combination of such 
     contracts, made by that agency under this chapter; and
       ``(B) a subcontractor performing any cost-reimbursement, 
     incentive, time-and-materials, labor-hour, or price-
     redeterminable subcontract under a contract referred to in 
     subparagraph (A) or under any combination of such contracts; 
     and
       ``(2) shall, for the purpose of evaluating the accuracy, 
     completeness, and currency of cost or pricing data required 
     to be submitted pursuant to section 2306a of this title with 
     respect to a contract or subcontract, have the right to 
     examine all records of the contractor or subcontractor 
     related to--
       ``(A) the proposal for the contract or subcontract;
       ``(B) the discussions conducted on the proposal;
       ``(C) pricing of the contract or subcontract; or
       ``(D) performance of the contract or subcontract.
       ``(b) Limitation on Preaward Audits Relating to Indirect 
     Costs.--The head of an agency may not perform a preaward 
     audit to evaluate proposed indirect costs under any contract, 
     subcontract, or modification to be entered into in accordance 
     with this chapter in any case in which the contracting 
     officer determines that the objectives of the audit can 
     reasonably be met by accepting the results of an audit 
     conducted by any other department or agency of the Federal 
     Government within one year preceding the date of the 
     contracting officer's determination.
       ``(c) Subpoena Power.--(1) The Director of the Defense 
     Contract Audit Agency (or any successor agency) may require 
     by subpoena the production of records of a contractor, access 
     to which is provided to the Secretary of Defense or Secretary 
     of a military department by subsection (a).
       ``(2) Any such subpoena, in the case of contumacy or 
     refusal to obey, shall be enforceable by order of an 
     appropriate United States district court.
       ``(3) The authority provided by paragraph (1) may not be 
     redelegated.
       ``(4) The Director (or any successor official) shall submit 
     an annual report to the Secretary of Defense on the exercise 
     of such authority during the preceding year and the reasons 
     why such authority was exercised in any instance. The 
     Secretary shall forward a copy of each such report to the 
     Committees on Armed Services of the Senate and House of 
     Representatives.
       ``(d) Comptroller General Authority.--(1) Except as 
     provided in paragraph (2), each contract awarded after using 
     procedures other than sealed bid procedures shall provide 
     that the Comptroller General and his representatives are 
     entitled to examine any records of the contractor, or any of 
     its subcontractors, that directly pertain to, and involve 
     transactions relating to, the contract or subcontract.
       ``(2) Paragraph (1) does not apply to a contract or 
     subcontract with a foreign contractor or foreign 
     subcontractor if the head of the agency concerned determines, 
     with the concurrence of the Comptroller General or his 
     designee, that the application of that paragraph to the 
     contract or subcontract would not be in the public interest. 
     However, the concurrence of the Comptroller General or his 
     designee is not required--
       ``(A) where the contractor or subcontractor is a foreign 
     government or agency thereof or is precluded by the laws of 
     the country involved from making its records available for 
     examination; and
       ``(B) where the head of the agency determines, after taking 
     into account the price and availability of the property and 
     services from United States sources, that the public interest 
     would be best served by not applying paragraph (1).
       ``(3) Paragraph (1) may not be construed to require a 
     contractor or subcontractor to create or maintain any record 
     that the contractor or subcontractor does not maintain in the 
     ordinary course of business or pursuant to another provision 
     of law.
       ``(e) Limitation.--The right of the head of an agency under 
     subsection (a), and the right of the Comptroller General 
     under subsection (d), with respect to a contract or 
     subcontract shall expire three years after final payment 
     under such contract or subcontract.
       ``(f) Inapplicability to Certain Contracts.--This section 
     is inapplicable with respect to the following contracts:
       ``(1) Contracts for utility services at rates not exceeding 
     those established to apply uniformly to the public, plus any 
     applicable reasonable connection charge.
       ``(g) Records Defined.--In this section, the term `records' 
     includes books, documents, accounting procedures and 
     practices, and other data, regardless of type and regardless 
     of whether such items are in written form, in the form of 
     computer data, or in any other form.''.
       (2) Clerical amendment.--The item relating to such section 
     in the table of sections at the beginning of chapter 137 of 
     title 10, United States Code, is amended to read as follows:

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

                 PART II--CIVILIAN AGENCY ACQUISITIONS

     SEC. 2251. AUTHORITY TO EXAMINE RECORDS OF CONTRACTORS.

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


                 ``examination of records of contractor

       ``Sec. 304B. (a) Agency Authority.--The head of an 
     executive agency, acting through an authorized 
     representative--
       ``(1) is entitled to inspect the plant and audit the 
     records of--
       ``(A) a contractor performing a cost-reimbursement, 
     incentive, time-and-materials, labor-hour, or price-
     redeterminable contract, or any combination of such 
     contracts, made by that executive agency under this title; 
     and
       ``(B) a subcontractor performing any cost-reimbursement, 
     incentive, time-and-materials, labor-hour, or price-
     redeterminable subcontract under a contract referred to in 
     subparagraph (A) or under any combination of such contracts; 
     and
       ``(2) shall, for the purpose of evaluating the accuracy, 
     completeness, and currency of cost or pricing data required 
     to be submitted pursuant to section 304A with respect to a 
     contract or subcontract, have the right to examine all 
     records of the contractor or subcontractor related to--
       ``(A) the proposal for the contract or subcontract;
       ``(B) the discussions conducted on the proposal;
       ``(C) pricing of the contract or subcontract; or
       ``(D) performance of the contract or subcontract.
       ``(b) Limitation on Preaward Audits Relating to Indirect 
     Costs.--The agency head may not perform a preaward audit to 
     evaluate proposed indirect costs under any contract, 
     subcontract, or modification to be entered into in accordance 
     with this title in any case in which the contracting officer 
     determines that the objectives of the audit can reasonably be 
     met by accepting the results of an audit conducted by any 
     other department or agency of the Federal Government within 
     one year preceding the date of the contracting officer's 
     determination.
       ``(c) Subpoena Power.--(1) The agency head may require by 
     subpoena the production of records of a contractor, access to 
     which is provided by subsection (a).
       ``(2) Any such subpoena, in the case of contumacy or 
     refusal to obey, shall be enforceable by order of an 
     appropriate United States district court.
       ``(3) The authority provided by paragraph (1) may not be 
     delegated.
       ``(4) In the year following a year in which the head of an 
     executive agency exercises the authority provided in 
     paragraph (1), the agency head shall submit to the Committee 
     on Governmental Affairs of the Senate and the Committee on 
     Government Operations of the House of Representatives a 
     report on the exercise of such authority during such 
     preceding year and the reasons why such authority was 
     exercised in any instance.
       ``(d) Comptroller General Authority.--(1) Except as 
     provided in paragraph (2), each contract awarded after using 
     procedures other than sealed bid procedures shall provide 
     that the Comptroller General and his representatives are 
     entitled to examine any records of the contractor, or any of 
     its subcontractors, that directly pertain to, and involve 
     transactions relating to, the contract or subcontract.
       ``(2) Paragraph (1) does not apply to a contract or 
     subcontract with a foreign contractor or foreign 
     subcontractor if the agency head concerned determines, with 
     the concurrence of the Comptroller General or his designee, 
     that the application of that paragraph to the contract or 
     subcontract would not be in the public interest. However, the 
     concurrence of the Comptroller General or his designee is not 
     required--
       ``(A) where the contractor or subcontractor is a foreign 
     government or agency thereof or is precluded by the laws of 
     the country involved from making its records available for 
     examination; and
       ``(B) where the agency head determines, after taking into 
     account the price and availability of the property and 
     services from United States sources, that the public interest 
     would be best served by not applying paragraph (1).
       ``(3) Paragraph (1) may not be construed to require a 
     contractor or subcontractor to create or maintain any record 
     that the contractor or subcontractor does not maintain in the 
     ordinary course of business or pursuant to another provision 
     of law.
       ``(e) Limitation.--The right of an agency head under 
     subsection (a), and the right of the Comptroller General 
     under subsection (d), with respect to a contract or 
     subcontract shall expire three years after final payment 
     under such contract or subcontract.
       ``(f) Inapplicability to Certain Contracts.--This section 
     is inapplicable with respect to the following contracts:
       ``(1) Contracts.--For utility services at rates not 
     exceeding those established to apply uniformly to the public, 
     plus any applicable reasonable connection charge.
       ``(g) Records Defined.--In this section, the term `records' 
     includes books, documents, accounting procedures and 
     practices, and other data, regardless of type and regardless 
     of whether such items are in written form, in the form of 
     computer data, or in any other form.''.
       (2) Clerical amendment.--The table of contents in the first 
     section of such Act, as amended by section 1251(b), is 
     further amended by inserting after the item relating to 
     section 304A the following:

``Sec. 304B. Examination of records of contractor.''.
       (b) Repeal of Superseded Provision.--Section 304 of the 
     Federal Property and Administrative Services Act of 1949 (41 
     U.S.C. 254) is amended by striking out subsection (c).
                 Subtitle D--Cost Accounting Standards

     SEC. 2301. EXCEPTIONS TO COVERAGE.

       Section 26(f)(2) of the Office of Federal Procurement 
     Policy Act (41 U.S.C. 422(f)(2)) is amended--
       (1) by inserting ``(A)'' after ``(2)'';
       (2) by striking out ``, other than contracts or 
     subcontracts'' and all that follows and inserting in lieu 
     thereof a period; and
       (3) by inserting at the end the following:
       ``(B) Subparagraph (A) does not apply to the following 
     contracts or subcontracts:
       ``(i) Contracts or subcontracts where the price negotiated 
     is based on established catalog or market prices of 
     commercial items sold in substantial quantities to the 
     general public.
       ``(ii) Contracts or subcontracts where the price negotiated 
     is based on prices set by law or regulation.
       ``(iii) Any other firm fixed-price contract or subcontract 
     for commercial items which is excepted from the requirement 
     to provide cost or pricing data pursuant to subsection (b) or 
     (d) of section 2306a of title 10, United States Code, or 
     subsection (b) or (d) of section 304A of the Federal Property 
     and Administrative Services Act of 1949.
       ``(C) In this paragraph, the term `subcontract' includes a 
     transfer of commercial items between divisions, subsidiaries, 
     or affiliates of a contractor.''.

     SEC. 2302. REPEAL OF OBSOLETE DEADLINE REGARDING PROCEDURAL 
                   REGULATIONS FOR THE COST ACCOUNTING STANDARDS 
                   BOARD.

       Section 26(f)(3) of the Office of Federal Procurement 
     Policy Act (41 U.S.C. 422(f)(3)) is amended in the first 
     sentence by striking out ``Not later than 180 days after the 
     date of the enactment of this section, the Administrator'' 
     and inserting in lieu thereof ``The Administrator''.
 Subtitle E--Administration of Contract Provisions Relating to Price, 
                     Delivery, and Product Quality

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 2401. PROCUREMENT OF CRITICAL AIRCRAFT AND SHIP SPARE 
                   PARTS; QUALITY CONTROL.

       (a) Repeal.--Section 2383 of title 10, United States Code, 
     is repealed.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 141 of such title is amended by striking 
     out the item relating to section 2383.

     SEC. 2402. CONTRACTOR GUARANTEES REGARDING WEAPON SYSTEMS.

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

                    PART II--ACQUISITIONS GENERALLY

     SEC. 2451. SECTION 3737 OF THE REVISED STATUTES: EXPANSION OF 
                   AUTHORITY TO PROHIBIT SETOFFS AGAINST 
                   ASSIGNEES; REORGANIZATION OF SECTION; REVISION 
                   OF OBSOLETE PROVISIONS.

       Section 3737 of the Revised Statutes (41 U.S.C. 15) is 
     amended to read as follows:
       ``Sec. 3737. (a) No contract or order, or any interest 
     therein, shall be transferred by the party to whom such 
     contract or order is given to any other party, and any such 
     transfer shall cause the annulment of the contract or order 
     transferred, so far as the United States is concerned. All 
     rights of action, however, for any breach of such contract by 
     the contracting parties, are reserved to the United States.
       ``(b) The provisions of subsection (a) shall not apply in 
     any case in which the moneys due or to become due from the 
     United States or from any agency or department thereof, under 
     a contract providing for payments aggregating $1,000 or more, 
     are assigned to a bank, trust company, or other financing 
     institution, including any Federal lending agency, provided:
       ``(1) That, in the case of any contract entered into after 
     October 9, 1940, no claim shall be assigned if it arises 
     under a contract which forbids such assignment.
       ``(2) That, unless otherwise expressly permitted by such 
     contract, any such assignment shall cover all amounts payable 
     under such contract and not already paid, shall not be made 
     to more than one party, and shall not be subject to further 
     assignment, except that any such assignment may be made to 
     one party as agent or trustee for two or more parties 
     participating in such financing.
       ``(3) That, in the event of any such assignment, the 
     assignee thereof shall file written notice of the assignment 
     together with a true copy of the instrument of the assignment 
     with--
       ``(A) the contracting officer or the head of his department 
     or agency;
       ``(B) the surety or sureties upon the bond or bonds, if 
     any, in connection with such contract; and
       ``(C) the disbursing officer, if any, designated in such 
     contract to make payment.
       ``(c) Notwithstanding any law to the contrary governing the 
     validity of assignments, any assignment pursuant to this 
     section shall constitute a valid assignment for all purposes.
       ``(d) In any case in which moneys due or to become due 
     under any contract are or have been assigned pursuant to this 
     section, no liability of any nature of the assignor to the 
     United States or any department or agency thereof, whether 
     arising from or independently of such contract, shall create 
     or impose any liability on the part of the assignee to make 
     restitution, refund, or repayment to the United States of any 
     amount heretofore since July 1, 1950, or hereafter received 
     under the assignment.
       ``(e) Any contract of the Department of Defense, the 
     General Services Administration, the Department of Energy, or 
     any other department or agency of the United States 
     designated by the President, except any such contract under 
     which full payment has been made, may, upon a determination 
     of need by the President, provide or be amended without 
     consideration to provide that payments to be made to the 
     assignee of any moneys due or to become due under such 
     contract shall not be subject to reduction or setoff. Each 
     such determination of need shall be published in the Federal 
     Register.
       ``(f) If a provision described in subsection (e) or a 
     provision to the same general effect has been at any time 
     heretofore or is hereafter included or inserted in any such 
     contract, payments to be made thereafter to an assignee of 
     any moneys due or to become due under such contract shall not 
     be subject to reduction or setoff for any liability of any 
     nature of the assignor to the United States or any department 
     or agency thereof which arises independently of such 
     contract, or hereafter for any liability of the assignor on 
     account of--
       ``(1) renegotiation under any renegotiation statute or 
     under any statutory renegotiation article in the contract;
       ``(2) fines;
       ``(3) penalties (which term does not include amounts which 
     may be collected or withheld from the assignor in accordance 
     with or for failure to comply with the terms of the 
     contract); or
       ``(4) taxes, social security contributions, or the 
     withholding or non withholding of taxes or social security 
     contributions, whether arising from or independently of such 
     contract.
       ``(g) Except as herein otherwise provided, nothing in this 
     section shall be deemed to affect or impair rights of 
     obligations heretofore accrued.''.

     SEC. 2452. REPEAL OF REQUIREMENT FOR DEPOSIT OF CONTRACTS 
                   WITH GAO.

       Section 3743 of the Revised Statutes (41 U.S.C. 20) is 
     repealed.
                    Subtitle F--Claims and Disputes

                  PART I--ARMED SERVICES ACQUISITIONS

     SEC. 2501. CERTIFICATION OF CONTRACT CLAIMS.

       (a) DoD Certification Requirement in Conflict With 
     Governmentwide Requirement.--
       (1) Inapplicability of requirement to contract claims.--
     Section 2410 of title 10, United States Code, is amended to 
     read as follows:

     ``Sec. 2410. Requests for equitable adjustment or other 
       relief: certification

       ``(a) Certification Requirement.--A request for equitable 
     adjustment to contract terms or request for relief under 
     Public Law 85-804 (50 U.S.C. 1431 et seq.) that exceeds the 
     simplified acquisition threshold may not be paid unless a 
     person authorized to certify the request on behalf of the 
     contractor certifies, at the time the request is submitted, 
     that--
       ``(1) the request is made in good faith, and
       ``(2) the supporting data are accurate and complete to the 
     best of that person's knowledge and belief.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of chapter 141 of such title is amended by striking 
     out the item relating to section 2410 and inserting in lieu 
     thereof the following:

``2410. Requests for equitable adjustment or other relief: 
              certification.''.
       (b) Restriction on Legislative Payment of Claims.--Section 
     2410 of title 10, United States Code, as amended by 
     subsection (a), is further amended by adding at the end the 
     following new subsection:
       ``(b) Restriction on Legislative Payment of Claims.--In the 
     case of a contract of an agency named in section 2303(a) of 
     this title, no provision of a law enacted after September 30, 
     1994, that directs the payment of a particular claim under 
     such contract, a particular request for equitable adjustment 
     to any term of such contract, or a particular request for 
     relief under Public Law 85-804 (50 U.S.C. 1431 et seq.) 
     regarding such contract may be implemented unless such 
     provision of law--
       ``(1) specifically refers to this subsection; and
       ``(2) specifically states that this subsection does not 
     apply with respect to the payment directed by that provision 
     of law.''.
       (c) Definition.--Section 2410, as amended by subsections 
     (a) and (b), is further amended by adding at the end the 
     following:
       ``(c) Definition.--In this section, the term `simplified 
     acquisition threshold' has the meaning given that term in 
     section 2302(4) of this title.''.
       (d) Repeal of Related Provisions.--
       (1) Certification regulations for contract claims exceeding 
     $100,000.--
       (A) Repeal.--Section 2410e of title 10, United States Code, 
     is repealed.
       (B) Clerical amendment.--The table of sections at the 
     beginning of chapter 141 of such title is amended by striking 
     out the item relating to section 2410e.
       (2) Conforming repeal.--Section 813(b) of the National 
     Defense Authorization Act for Fiscal Year 1993 (Public Law 
     102-484, 106 Stat. 2453), is repealed.

     SEC. 2502. SHIPBUILDING CLAIMS.

       (a) Limitation on Period for Submission.--
       (1) Increased period.--Subsection (a) of section 2405 of 
     title 10, United States Code, is amended--
       (A) by striking out ``after December 7, 1983,'' and 
     inserting in lieu thereof ``on or after the date of the 
     enactment of the Federal Acquisition Streamlining Act of 
     1994''; and
       (B) by striking out ``18 months'' and inserting in lieu 
     thereof ``6 years''.
       (2) Savings provision.--Notwithstanding the 6-year period 
     provided in subsection (a) of section 2405 of title 10, 
     United States Code, as amended by paragraph (1), the period 
     applicable under such subsection in the case of a 
     shipbuilding contract entered into after December 7, 1983, 
     and before the date of the enactment of the Federal 
     Acquisition Streamlining Act of 1994 shall continue to be 18 
     months.
       (b) Resubmission With Corrected Certification.--Subsection 
     (c) of such section is repealed.

                    PART II--ACQUISITIONS GENERALLY

     SEC. 2551. CLAIMS JURISDICTION OF UNITED STATES DISTRICT 
                   COURTS AND THE UNITED STATES COURT OF FEDERAL 
                   CLAIMS.

       (a) Concurrent Jurisdiction of United States District 
     Courts Under the Little Tucker Act.--Subsection (a) of 
     section 1346 of title 28, United States Code, is amended to 
     read as follows:
       ``(a)(1) The district courts shall have original 
     jurisdiction, concurrent with the United States Court of 
     Federal Claims, of any civil action against the United States 
     for the recovery of any internal-revenue tax alleged to have 
     been erroneously or illegally assessed or collected, or any 
     penalty claimed to have been collected without authority or 
     any sum alleged to have been excessive or in any manner 
     wrongfully collected under the internal-revenue laws.
       ``(2)(A) Except as provided in subparagraph (B), the 
     district courts shall have original jurisdiction, concurrent 
     with the United States Court of Federal Claims, of any other 
     civil action or claim against the United States, not 
     exceeding $10,000 in amount, founded either upon the 
     Constitution, or any Act of Congress, or any regulation of an 
     executive department, or upon any express or implied contract 
     with the United States, or for liquidated or unliquidated 
     damages in cases not sounding in tort.
       ``(B) The district courts shall not have jurisdiction over 
     any civil action or claim against the United States or any 
     Federal entity which relates in any manner to a contract to 
     which the Contract Disputes Act of 1978 (41 U.S.C. 601 et 
     seq.) applies, including a claim that seeks to establish the 
     existence or nonexistence of such a contract, seeks to 
     establish that such a contract is void, or seeks to determine 
     and construe the terms of such a contract. The district 
     courts do not have jurisdiction over any civil action or 
     claim described in the preceding sentence pursuant to section 
     1331, 1334, or 1346(a)(2)(B) of this title, any provision of 
     law giving a Federal entity the right to sue or be sued in 
     its own name, or any other provision of law.''.
       (b) Jurisdiction of the United States Court of Federal 
     Claims Under the Tucker Act.--Section 1491 of title 28, 
     United States Code, as amended by section 1422, is further 
     amended by inserting after subsection (c) the following:
       ``(d)(1) The United States Court of Federal Claims shall 
     have jurisdiction over any civil action or claim against the 
     United States which relates in any manner to a contract to 
     which the Contract Disputes Act of 1978 (41 U.S.C. 601 et 
     seq,) applies, including a civil action or claim that seeks 
     to establish the existence or nonexistence of such a 
     contract, seeks to establish that such contract is void, or 
     seeks to determine and construe the terms of any such 
     contract.
       ``(2) The jurisdiction of the United States Court of 
     Federal Claims is, pursuant to section 1346(a)(2)(B) of this 
     title, exclusive as to the district courts of the United 
     States.''.

     SEC. 2552. CONTRACT DISPUTES ACT IMPROVEMENTS.

       (a) Period for Filing Claims.--
       (1) Six-year limitation.--Section 6 of the Contract 
     Disputes Act of 1978 (41 U.S.C. 605) is amended in subsection 
     (a) by inserting after the second sentence the following: 
     ``Each claim by a contractor against the government relating 
     to a contract and each claim by the government against a 
     contractor relating to a contract shall be submitted within 6 
     years after the occurrence of the event or events giving rise 
     to the claim. The preceding sentence does not apply to a 
     claim by the government against a contractor that is based on 
     a claim by the contractor involving fraud.''.
       (2) Limitation on applicability to existing contracts.--
     Notwithstanding the third sentence of section 6(a) of the 
     Contract Disputes Act of 1978, as added by paragraph (1), if 
     a contract in existence on the date of the enactment of this 
     Act requires that a claim referred to in that sentence be 
     submitted earlier than 6 years after the occurrence of the 
     event or events giving rise to the claim, then the claim 
     shall be submitted within the period required by the 
     contract. The preceding sentence does not apply to a claim by 
     the Federal Government against a contractor that is based on 
     a claim by the contractor involving fraud.
       (b) Increased Threshold for Certification, Decision, and 
     Notification Requirements.--Subsection (c) of such section is 
     amended by striking out ``$50,000'' each place it appears and 
     inserting in lieu thereof ``$100,000''.
       (c) Increased Maximum for Applicability of Accelerated 
     Procedures.--Section 8(f) of the Contract Disputes Act of 
     1978 (41 U.S.C. 607(f)) is amended by striking out 
     ``$50,000'' in the first sentence and inserting in lieu 
     thereof ``$150,000''.
       (d) Increased Maximum for Applicability of Small Claims 
     Procedure.--Section 9(a) of the Contract Disputes Act of 1978 
     (41 U.S.C. 608(a)) is amended by striking out ``$10,000'' in 
     the first sentence and inserting in lieu thereof ``$50,000''.
       (e) Reduced Period for Filing Action in Court of Federal 
     Claims.--Section 10(a)(3) of such Act (41 U.S.C. 609(a)(3)) 
     is amended by striking out ``twelve months'' and inserting in 
     lieu thereof ``90 days''.

     SEC. 2553. EXTENSION OF ALTERNATIVE DISPUTE RESOLUTION 
                   AUTHORITY.

       (a) Extension of Authority.--Section 6(e) of the Contracts 
     Disputes Act of 1978 (41 U.S.C. 605(e)) is amended by 
     striking out ``October 1, 1995'' and inserting in lieu 
     thereof ``October 1, 1999''.
       (b) Availability of Procedures to Small Business Government 
     Contractors.--Section 6(e) of such Act is amended by 
     inserting after the first sentence the following: ``In any 
     case in which the contracting officer rejects a contractor's 
     request for alternative dispute resolution proceedings, the 
     contracting officer shall provide the contractor with a 
     written explanation, citing one or more of the conditions in 
     section 572(b) of title V, United States Code, or such other 
     specific reasons that alternative dispute resolution 
     procedures are inappropriate for the resolution of the 
     dispute. In any case in which a contractor rejects a request 
     of an agency for alternative dispute resolution proceedings, 
     the contractor shall inform the agency in writing of the 
     contractor's specific reasons for rejecting the request.''.

     SEC. 2554. EXPEDITED RESOLUTION OF CONTRACT ADMINISTRATION 
                   COMPLAINTS.

       (a) Regulations Required.--The Federal Acquisition 
     Regulation shall include provisions that require a 
     contracting officer--
       (1) to make every reasonable effort to respond in writing 
     within 30 days to any written request made to a contracting 
     officer with respect to a matter relating to the 
     administration of a contract that is received from a small 
     business concern; and
       (2) in the event that the contracting officer is unable to 
     reply within the 30-day period, to transmit to the contractor 
     within such period a written notification of a specific date 
     by which the contracting officer expects to respond.

     The provisions shall not apply to a request for a contracting 
     officer's decision under the Contract Disputes Act of 1978 
     (41 U.S.C. 601 et seq.).
       (b) Rule of Construction.--Nothing in this provision shall 
     be considered as creating any rights under the Contract 
     Disputes Act (41 U.S.C. 601 et seq.).
       (c) Definition.--In this section, the term ``small business 
     concern'' means a business concern that meets the 
     requirements of section 3(a) of the Small Business Act (15 
     U.S.C. 632(a)) and the regulations promulgated pursuant to 
     that section.

     SEC. 2555. AUTHORITY FOR DISTRICT COURTS TO OBTAIN ADVISORY 
                   OPINIONS FROM BOARDS OF CONTRACT APPEALS IN 
                   CERTAIN CASES.

       Section 10 of the Contract Disputes Act of 1978 (41 U.S.C. 
     609) is amended by adding at the end the following new 
     paragraph:
       ``(f)(1) Whenever an action involving an issue described in 
     paragraph (2) is pending in a district court of the United 
     States, the district court may request a board of contract 
     appeals to provide the court with an advisory opinion on the 
     matters of contract interpretation at issue.
       ``(2) An issue referred to in paragraph (1) is any issue 
     that could be the proper subject of a final decision of a 
     contracting officer appealable under this Act.
       ``(3) A district court shall direct any request under 
     paragraph (1) to the board of contract appeals having 
     jurisdiction under this Act to adjudicate appeals of contract 
     claims under the contract or contracts being interpreted by 
     the court.
       ``(4) Within ninety days after receiving a request for an 
     advisory opinion under paragraph (1), a board of contract 
     appeals shall provide the advisory opinion to the district 
     court making the request.''.
         TITLE III--SERVICE SPECIFIC AND MAJOR SYSTEMS STATUTES
                   Subtitle A--Major Systems Statutes

     SEC. 3001. REQUIREMENT FOR INDEPENDENT COST ESTIMATES AND 
                   MANPOWER ESTIMATES BEFORE DEVELOPMENT OR 
                   PRODUCTION.

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

     SEC. 3002. ENHANCED PROGRAM STABILITY.

       (a) Baseline Descriptions and Deviation Reporting.--Section 
     2435 of title 10, United States Code, is amended--
       (1) in subsection (a)--
       (A) by striking out paragraph (2); and
       (B) in paragraph (1)--
       (i) by striking out ``(1)''; and
       (ii) by redesignating subparagraphs (A) and (B) as 
     paragraphs (1) and (2), respectively; and
       (2) by striking out subsection (b) and inserting in lieu 
     thereof the following:
       ``(b) Regulations.--The Secretary of Defense shall 
     prescribe regulations governing--
       ``(1) the content of baseline descriptions, which shall 
     include the program cost, the program schedule, and a program 
     performance description;
       ``(2) the submission of reports on deviations of a program 
     from the baseline description by the program manager to the 
     Secretary of the military department concerned and the Under 
     Secretary of Defense for Acquisition and Technology;
       ``(3) procedures for review of deviation reports within the 
     Department of Defense; and
       ``(4) procedures for submission and approval of revised 
     baseline descriptions.
       ``(c) Baseline Description Required Before Obligation of 
     Funds.--(1) Except as provided in paragraph (2), no amount 
     appropriated or otherwise made available to the Department of 
     Defense may be obligated for a major defense acquisition 
     program before a baseline description for the program is 
     approved in accordance with the procedures prescribed 
     pursuant to subsection (b)(4).
       ``(2) An obligation otherwise prohibited by paragraph (1) 
     may be incurred if approved in advance by the Under Secretary 
     of Defense for Acquisition and Technology.''.
       (b) Terminology Correction.--Subsection (a)(1) of such 
     section, as redesignated by subsection (a)(1)(B)(ii), is 
     amended by striking out ``full-scale engineering 
     development'' and inserting in lieu thereof ``engineering and 
     manufacturing development''.

     SEC. 3003. REPEAL OF REQUIREMENT TO DESIGNATE CERTAIN MAJOR 
                   DEFENSE ACQUISITION PROGRAMS AS DEFENSE 
                   ENTERPRISE PROGRAMS.

       Section 809 of the National Defense Authorization Act for 
     Fiscal Year 1991 (Public Law 101-510; 10 U.S.C. 2430 note) is 
     amended--
       (1) by striking out subsection (d); and
       (2) by redesignating subsections (e), (f), (g), and (h) as 
     subsections (d), (e), (f), and (g), respectively.

     SEC. 3004. REPEAL OF REQUIREMENT FOR COMPETITIVE PROTOTYPING 
                   IN MAJOR PROGRAMS.

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

     SEC. 3005. REPEAL OF REQUIREMENT FOR COMPETITIVE ALTERNATIVE 
                   SOURCES IN MAJOR PROGRAMS.

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

     SEC. 3011. DIRECTOR OF OPERATIONAL TEST AND EVALUATION TO 
                   REPORT DIRECTLY TO SECRETARY OF DEFENSE.

       Section 139(c) of title 10, United States Code, is amended 
     by inserting after ``(c)'' the following: ``The Director 
     reports directly, without intervening review or approval, to 
     the Secretary of Defense and Deputy Secretary of Defense 
     personally.''.

     SEC. 3012. RESPONSIBILITY OF DIRECTOR OF OPERATIONAL TEST AND 
                   EVALUATION FOR LIVE FIRE TESTING.

       (a) Conduct of Live Fire Testing.--Subsection (b) of 
     section 139 of title 10, United States Code, is amended--
       (1) by striking out ``and'' at the end of paragraph (4);
       (2) by striking out the period at the end of paragraph (5) 
     and inserting in lieu thereof ``; and''; and
       (3) by adding at the end the following new paragraph:
       ``(6) conduct the live fire testing activities of the 
     Department of Defense provided for under section 2366 of this 
     title.''.
       (b) Annual Report on Live Fire Testing.--Subsection (f) of 
     such section is amended by inserting ``(including live fire 
     testing activities)'' in the first sentence after 
     ``operational test and evaluation activities''.

     SEC. 3013. REQUIREMENT FOR UNCLASSIFIED VERSION OF ANNUAL 
                   REPORT ON OPERATIONAL TEST AND EVALUATION.

       Section 139(f) of title 10, United States Code, is amended 
     by inserting after the second sentence the following new 
     sentence: ``If the Director submits the report to Congress in 
     a classified form, the Director shall concurrently submit an 
     unclassified version of the report to Congress.''.
                   Subtitle C--Service Specific Laws

     SEC. 3021. GRATUITOUS SERVICES OF OFFICERS OF CERTAIN RESERVE 
                   COMPONENTS.

       Section 279 of title 10, United States Code, is amended--
       (1) by striking out ``Notwithstanding'' and inserting in 
     lieu thereof ``(a) Acceptance by Secretary of a Military 
     Department.--Notwithstanding''; and
       (2) by adding at the end the following new subsection:
       ``(b) Acceptance by Secretary of Defense.--Notwithstanding 
     section 1342 of title 31, the Secretary of Defense may accept 
     the gratuitous services of an officer of a reserve component 
     (other than an officer of the Army National Guard of the 
     United States or the Air National Guard of the United States) 
     in consultation upon matters relating to the armed forces.''.

     SEC. 3022. AUTHORITY TO RENT SAMPLES, DRAWINGS, AND OTHER 
                   INFORMATION TO OTHERS.

       Subchapter V of chapter 148 of title 10, United States 
     Code, is amended in section 2541(a) by inserting ``rent,'' 
     after ``sell,'' each place it appears in paragraphs (1) and 
     (2).

     SEC. 3023. CIVIL RESERVE AIR FLEET.

       (a) Definitions.--Section 9511 of title 10, United States 
     Code, is amended--
       (1) in paragraph (1)--
       (A) by inserting ```civil aircraft','' after ```person','';
       (B) by striking out ``meaning'' and inserting in lieu 
     thereof ``meanings''; and
       (C) by striking out ``(49 U.S.C. 1301)'' and inserting in 
     lieu thereof ``(49 U.S.C. App. 1301)'';
       (2) in paragraph (2), by striking out ``passenger-cargo'' 
     and inserting in lieu thereof ``passenger cargo'';
       (3) in paragraph (3), by striking out ``cargo-capable'' and 
     inserting in lieu thereof ``cargo capable'';
       (4) by striking out paragraph (5) and inserting in lieu 
     thereof the following:
       ``(5) The term `cargo convertible aircraft' means a 
     passenger aircraft equipped or designed so that all or 
     substantially all of the main deck of the aircraft can be 
     readily converted for the carriage of property or mail.'';
       (5) by striking out paragraph (6);
       (6) by redesignating paragraph (7) as paragraph (6);
       (7) by redesignating paragraph (8) as paragraph (7) and--
       (A) in subparagraph (A) of such paragraph, by inserting 
     ``under section 9512 of this title'' after ``and who 
     contracts with the Secretary'';
       (B) by striking out ``or'' at the end of such subparagraph 
     (A); and
       (C) by inserting before the period at the end of such 
     paragraph the following: ``, or (C) who owns or controls 
     existing aircraft, or will own or control new aircraft, and 
     who contractually commits all or some of such aircraft to the 
     Civil Reserve Air Fleet'';
       (8) by redesignating paragraphs (9), (10), (11), and (12) 
     as paragraphs (8), (9), (10), and (11), respectively; and
       (9) in paragraph (11), as so redesignated--
       (A) by striking out ``interoperability'' and inserting in 
     lieu thereof ``compatibility''; and
       (B) by striking out ``a cargo-convertible, cargo-capable, 
     or passenger-cargo combined aircraft'' and inserting in lieu 
     thereof ``an aeromedical aircraft or a cargo convertible, 
     cargo capable, or passenger cargo combined aircraft''.
       (b) Consolidation of Provisions Relating to Contractual 
     Commitment of Aircraft.--Chapter 931 of such title is 
     amended--
       (1) by redesignating subsections (b) and (c) of section 
     9512 as subsections (c) and (d), respectively;
       (2) by redesignating subsection (a) of section 9513 as 
     subsection (b), transferring such subsection (as so 
     redesignated) to section 9512, and inserting such subsection 
     after subsection (a);
       (3) by redesignating subsection (b) of section 9513 as 
     subsection (e) and transferring such subsection (as so 
     redesignated) to the end of section 9512;
       (4) in subsection (c) of section 9512, as redesignated by 
     paragraph (1), by striking out ``the terms required by 
     section 9513 of this title and'';
       (5) in subsection (e) of section 9512, as redesignated and 
     transferred to such section by paragraph (3), by striking out 
     ``under section 9512 of this title'' and inserting in lieu 
     thereof ``entered into under this section''; and
       (6) by striking out the heading of section 9513.
       (c) Use of Military Installations by Contractors.--
       (1) Authority.--Such chapter, as amended by subsection (b), 
     is further amended by adding at the end the following new 
     section 9513:

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

       ``(a) Contract Authority.--(1) The Secretary of the Air 
     Force--
       ``(A) may, by contract entered into with any contractor, 
     authorize such contractor to use one or more Air Force 
     installations designated by the Secretary; and
       ``(B) with the consent of the Secretary of another military 
     department, may, by contract entered into with any 
     contractor, authorize the contractor to use one or more 
     installations, designated by the Secretary of the Air Force, 
     that is under the jurisdiction of the Secretary of such other 
     military department.
       ``(2) The Secretary of the Air Force may include in the 
     contract such terms and conditions as the Secretary 
     determines appropriate to promote the national defense or to 
     protect the interests of the United States.
       ``(b) Purposes of Use.--A contract entered into under 
     subsection (a) may authorize use of a designated installation 
     as a weather alternate, a service stop not involving the 
     enplaning or deplaning of passengers or cargo, or, in the 
     case of an installation within the United States, for other 
     commercial purposes. Notwithstanding any other provision of 
     the law, the Secretary may establish different levels and 
     types of uses for different installations for commercial 
     operations not required by the Department of Defense and may 
     provide in contracts under subsection (a) for different 
     levels and types of uses by different contractors.
       ``(c) Disposition of Payments for Use.--Notwithstanding any 
     other provision of law, amounts collected from the contractor 
     for landing fees, services, supplies, or other charges 
     authorized to be collected under the contract shall be 
     credited to the appropriations of the armed forces having 
     jurisdiction over the military installation to which the 
     contract pertains. Amounts so credited to an appropriation 
     shall be available for obligation for the same period as the 
     appropriation to which credited.
       ``(d) Hold Harmless Requirement.--A contract entered into 
     under subsection (a) shall provide that the contractor agrees 
     to indemnify and hold harmless the United States from all 
     actions, suits, or claims of any sort resulting from, 
     relating to, or arising out of any activities conducted, or 
     services or supplies furnished, in connection with the 
     contract.
       ``(e) Reservation of Right To Exclude Contractor.--A 
     contract entered into under subsection (a) shall provide that 
     the Secretary or, in the case of an installation under the 
     jurisdiction of an armed force other than the Air Force, the 
     Secretary concerned may at any time and without prior notice 
     deny access to an installation designated under the contract 
     if military exigencies require such action.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of such chapter is amended by striking out the item 
     relating to section 9513 and inserting in lieu thereof the 
     following:

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

     SEC. 3024. EXCHANGE OF PERSONNEL.

       (a) Exchange Authority.--Subchapter II of chapter 138 of 
     title 10, United States Code, is amended by adding at the end 
     the following new section:

     ``Sec. 2350k. Exchange of personnel

       ``(a) International Exchange Agreements Authorized.--Under 
     regulations prescribed by the Secretary of Defense, the 
     Secretary and the secretaries of the military departments are 
     each authorized to enter into agreements with the governments 
     of foreign countries for the exchange of military and 
     civilian personnel of the Department of Defense and military 
     and civilian personnel of the defense departments or 
     ministries of such foreign governments.
       ``(b) Assignment of Personnel.--Pursuant to such 
     agreements, personnel of the foreign defense departments or 
     ministries may be assigned to positions in the Department of 
     Defense, and personnel of the Department of Defense may be 
     assigned to positions in foreign defense departments or 
     ministries. Agreements for the exchange of personnel engaged 
     in research and development activities may provide for 
     assignments to positions in private industry that support the 
     defense departments or ministries. The specific positions and 
     the individuals to be assigned must be acceptable to both the 
     sending government and the host government.
       ``(c) Reciprocity of Personnel Qualifications Required.--
     Each government shall be required under an agreement 
     authorized by subsection (a) to provide personnel having 
     qualifications, training, and skills that are essentially 
     equal to those of the personnel provided by the other 
     government.
       ``(d) Payment of Personnel Costs.--Each government shall 
     pay the salary, per diem, cost of living, travel, cost of 
     language or other training, and other costs (except for cost 
     of temporary duty directed by the host government and costs 
     incident to the use of host government facilities in the 
     performance of assigned duties) for its own personnel in 
     accordance with the laws and regulations of such government 
     that pertain to such matters.''.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of subchapter II of such chapter is amended by 
     adding at the end the following new item:

``2350k. Exchange of personnel.''.

     SEC. 3025. SCIENTIFIC INVESTIGATION AND RESEARCH FOR THE 
                   NAVY.

       (a) Repeal.--Section 7203 of title 10, United States Code, 
     is repealed.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 631 of such title is amended by striking 
     out the item relating to section 7203.

     SEC. 3026. CONSTRUCTION OF COMBATANT AND ESCORT VESSELS AND 
                   ASSIGNMENT OF VESSEL PROJECTS.

       (a) Repeal of Obsolete and Internally Inconsistent 
     Provisions.--Section 7299a of title 10, United States Code, 
     is amended--
       (1) by striking out subsection (a); and
       (2) by redesignating subsections (b) and (c) as subsections 
     (a) and (b), respectively.
       (b) Conforming Amendment.--Subsection (b) of such section, 
     as redesignated by subsection (a)(2), is amended in paragraph 
     (2) by striking out ``subsection (a) or''.

     SEC. 3027. REPEAL OF REQUIREMENT FOR CONSTRUCTION OF VESSELS 
                   ON PACIFIC COAST.

       (a) Repeal.--Section 7302 of title 10, United States Code, 
     is repealed.
       (b) Clerical Amendment.--The table of sections at the 
     beginning of chapter 633 of such title is amended by striking 
     out the item relating to section 7302.

     SEC. 3028. AUTHORITY TO TRANSFER BY GIFT A VESSEL STRICKEN 
                   FROM NAVAL VESSEL REGISTER.

       Section 7306(a)(1) of title 10, United States Code, is 
     amended by inserting ``Territory,'' after ``State,''.

     SEC. 3029. NAVAL SALVAGE FACILITIES.

       Chapter 637 of title 10, United States Code, is amended--
       (1) in section 7361--
       (A) in subsection (a), by inserting ``Authority To Provide 
     Facilities by Contract or Otherwise.--'' after ``(a)'';
       (B) in subsection (b), by inserting ``Contracts Affecting 
     the Department of Transportation.--'' after ``(b)''; and
       (C) by striking out subsection (c) and inserting in lieu 
     thereof the following new subsection (c):
       ``(c) Limitation on Term Contracts.--Term contracts may be 
     entered into for purposes of this section only after--
       ``(1) it has been demonstrated to the satisfaction of the 
     Secretary of the Navy that available commercial salvage 
     facilities are inadequate to meet national defense 
     requirements; and
       ``(2) the Secretary of the Navy determines that adequate 
     public notice of intent to exercise the authority under this 
     subsection has been provided.'';
       (2) by designating the text of section 7362 as subsection 
     (d) and transferring such text, as so designated, to the end 
     of section 7361 of title 10, United States Code;
       (3) in subsection (d) of section 7361 of such title, as so 
     designated and transferred, by inserting before ``The 
     Secretary'' the following: ``Commercial Use of Naval Vessels 
     and Equipment.--'';
       (4) by designating the text of section 7363 as subsection 
     (e) and transferring such text, as so designated, to the end 
     of section 7361 of title 10, United States Code;
       (5) in subsection (e) of section 7361 of such title, as so 
     designated and transferred, by inserting before ``Before any 
     salvage vessel'' the following: ``Conditions for Transfer of 
     Equipment.--'';
       (6) by designating the text of section 7365 as subsection 
     (f) and transferring such text, as so designated, to the end 
     of section 7361 of title 10, United States Code;
       (7) in subsection (f) of section 7361 of such title, as so 
     designated and transferred, by inserting before ``The 
     Secretary'' the following: ``Settlement of Claims.--'';
       (8) by designating the text of section 7367 as subsection 
     (g) and transferring such text, as so designated, to the end 
     of section 7361 of title 10, United States Code;
       (9) in subsection (g) of section 7361 of such title, as so 
     designated and transferred--
       (A) by inserting before ``Money received'' the following: 
     ``Disposition of Receipts.--''; and
       (B) by striking out ``this chapter'' in the first sentence 
     and inserting in lieu thereof ``this section'';
       (10) by striking out the section headings for sections 
     7362, 7363, 7365, and 7367;
       (11) by striking out the heading for section 7361 and 
     inserting in lieu thereof the following:

     ``Sec. 7361. Navy support for salvage operations'';

     and
       (12) in the table of sections at the beginning of such 
     chapter--
       (A) by striking out the item relating to section 7361 and 
     inserting in lieu thereof the following:

``7361. Navy support for salvage operations.'';
     and
       (B) by striking out the items relating to sections 7362, 
     7363, 7365, and 7367.
 Subtitle D--Department of Defense Commercial and Industrial Activities

     SEC. 3051. ACCOUNTING REQUIREMENT FOR CONTRACTED ADVISORY AND 
                   ASSISTANCE SERVICES.

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

     SEC. 3061. LIQUID FUELS AND NATURAL GAS: CONTRACTS FOR 
                   STORAGE, HANDLING, OR DISTRIBUTION.

       Section 2388(a) of title 10, United States Code, is amended 
     by striking out ``liquid fuels and natural gas'' and 
     inserting in lieu thereof ``liquid fuels or natural gas''.
                      Subtitle F--Fiscal Statutes

     SEC. 3071. DISBURSEMENT OF FUNDS OF MILITARY DEPARTMENT TO 
                   COVER OBLIGATIONS OF ANOTHER AGENCY OF 
                   DEPARTMENT OF DEFENSE.

       Subsection (c)(2) of section 3321 of title 31, United 
     States Code, is amended by striking out ``military 
     departments of the'' and inserting in lieu thereof ``The''.
                       Subtitle G--Miscellaneous

     SEC. 3081. OBLIGATION OF FUNDS: LIMITATION.

       Section 2202 of title 10, United States Code, is amended to 
     read as follows:

     ``Sec. 2202. Obligation of funds: limitation

       ``The Secretary of Defense shall prescribe regulations 
     governing the performance within the Department of Defense of 
     the procurement, production, warehousing, and supply 
     distribution functions, and related functions, of the 
     Department of Defense.''.

     SEC. 3082. REPEAL OF REQUIREMENTS REGARDING PRODUCT 
                   EVALUATION ACTIVITIES.

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

     SEC. 3083. CODIFICATION AND REVISION OF LIMITATION ON LEASE 
                   OF VESSELS, AIRCRAFT, AND VEHICLES.

       (a) Limitation.--
       (1) In general.--Chapter 141 of title 10, United States 
     Code, is amended by adding at the end the following new 
     section:

     ``Sec. 2410l. Lease of vessels, aircraft, and vehicles

       ``The head of an agency named in paragraph (1), (2), (3), 
     or (4) of section 2303(a) of this title may not enter into 
     any contract with a term of 18 months or more, or extend or 
     renew any contract for a term of 18 months or more, for any 
     vessel, aircraft, or vehicle, through a lease, charter, or 
     similar agreement without previously having considered all 
     costs of such lease (including estimated termination 
     liability) and determined in writing that such lease is in 
     the best interest of the Government.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of such chapter is amended by adding at the end the 
     following:

``2410l. Lease of vessels, aircraft, and vehicles.''.

       (b) Repeal of Superseded Provision.--Section 9081 of Public 
     Law 101-165 (103 Stat. 1147; 10 U.S.C. 2401 note) is 
     repealed.

     SEC. 3084. SOFT DRINK SUPPLIES FOR EXCHANGE STORES.

       Section 2424 of title 10, United States Code, is amended by 
     adding at the end the following new subsection:
       ``(c) Paragraphs (1) and (2) of subsection (b) do not apply 
     to contracts for the procurement of soft drinks that are 
     manufactured in the United States. The Secretary of Defense 
     shall prescribe in regulations the standards and procedures 
     for determining whether a particular drink is a soft drink 
     and whether the drink was manufactured in the United 
     States.''.

     SEC. 3085. REPEAL OF PREFERENCE FOR RECYCLED TONER 
                   CARTRIDGES.

       The following provisions of law, relating to a preference 
     for procurement of recycled toner cartridges, are repealed:
       (1) Section 630 of Public Law 102-393 (106 Stat. 1773) and 
     the provision of law set out in quotes in that section (42 
     U.S.C. 6962(j)).
       (2) Section 401 of Public Law 103-123 (107 Stat. 1238).
  TITLE IV--SIMPLIFIED ACQUISITION THRESHOLD AND SOCIOECONOMIC, SMALL 
                    BUSINESS, AND MISCELLANEOUS LAWS
              Subtitle A--Simplified Acquisition Threshold

                   PART I--ESTABLISHMENT OF THRESHOLD

     SEC. 4001. SIMPLIFIED ACQUISITION THRESHOLD.

       (a) Term Defined.--Section 4(11) of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 403(11)) is amended to read 
     as follows:
       ``(11) The term `simplified acquisition threshold' means 
     $100,000.''.
       (b) Interim Reporting Rule.--Until October 1, 1999, 
     procuring activities shall continue to report procurement 
     awards with a dollar value of at least $25,000, but less than 
     $100,000, in conformity with the procedures for the reporting 
     of a contract award in excess of $25,000 that were in effect 
     on October 1, 1992.

                 PART II--SIMPLIFICATION OF PROCEDURES

     SEC. 4011. SIMPLIFIED ACQUISITION PROCEDURES.

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


                  ``simplified acquisition procedures

       ``Sec. 29. (a) In order to promote efficiency and economy 
     in contracting and to avoid unnecessary burdens for agencies 
     and contractors, the Federal Acquisition Regulation shall 
     provide for special simplified procedures for contracts for 
     acquisition of property and services that are not in excess 
     of the simplified acquisition threshold.
       ``(b) Regulations prescribed pursuant to subsection (a) 
     shall include the following provisions:
       ``(1) A provision that a contract with an anticipated value 
     not in excess of $2,500 is not subject to section 15(j) of 
     the Small Business Act (15 U.S.C. 644(j)) and section 2 of 
     title III of the Act of March 3, 1933 (commonly known as the 
     `Buy America Act') (41 U.S.C. 10a et seq.).
       ``(2) A provision that a civilian or military official, or 
     employee of an agency, whose contracting authority does not 
     exceed $2,500 is not a procurement official for the purposes 
     of section 27 of this Act.
       ``(3) A provision that a purchase not in excess of $2,500 
     may be made without obtaining competitive quotations if the 
     contracting officer determines that the price for the 
     purchase is reasonable.
       ``(4) A requirement that purchases not in excess of $2,500 
     be distributed equitably among qualified suppliers.
       ``(5) A requirement that a contracting officer consider 
     each responsive offer timely received from an eligible 
     offeror.
       ``(c) A proposed purchase or contract for an amount above 
     the simplified acquisition threshold may not be divided into 
     several purchases or contracts for lesser amounts in order to 
     use the simplified acquisition procedures required by 
     subsection (a).
       ``(d) In using simplified acquisition procedures, the head 
     of an executive agency shall promote competition to the 
     maximum extent practicable.''.

     SEC. 4012. SMALL BUSINESS RESERVATION.

       Section 15(j) of the Small Business Act (15 U.S.C. 644(j)) 
     is amended to read as follows:
       ``(j)(1) Each contract for the purchase of goods and 
     services that has an anticipated value in excess of $2,500 
     but not in excess of the simplified acquisition threshold and 
     that is subject to simplified acquisition procedures 
     prescribed pursuant to section 29 of the Office of Federal 
     Procurement Policy Act shall be reserved exclusively for 
     small business concerns unless the contracting officer is 
     unable to obtain offers from two or more small business 
     concerns that are competitive with market prices and are 
     competitive with regard to the quality and delivery of the 
     goods or services being purchased.
       ``(2) In carrying out paragraph (1), a contracting officer 
     shall consider a responsive offer timely received from an 
     eligible small business offeror.
       ``(3) Nothing in paragraph (1) shall be construed as 
     precluding an award of a contract with a value not in excess 
     of the simplified acquisition threshold under the authority 
     of subsection (a) or (c) of section 8 of this Act, section 
     2323 of title 10, United States Code, or section 712 of the 
     Business Opportunity Development Reform Act of 1988 (Public 
     Law 100-656; 15 U.S.C. 644 note).''.

     SEC. 4013. FAST PAYMENT UNDER SIMPLIFIED ACQUISITION 
                   PROCEDURES.

       (a) Payment Procedures.--The simplified acquisition 
     procedures described in section 29(a) of the Office of 
     Federal Procurement Policy Act (as added by section 4011) 
     shall provide for use of the payment terms described in 
     subsection (b), and for the disbursement of payment through 
     electronic fund transfer, whenever circumstances permit.
       (b) Required Payment Terms.--The payment terms for a 
     purchase made pursuant to simplified acquisition procedures 
     shall require payment, in accordance with the provisions of 
     chapter 39 of title 31, United States Code, within 15 days 
     after the date of the receipt of a proper invoice for 
     products delivered or services performed, if--
       (1) in the case of a purchase of property, title to the 
     property vests in the Government upon delivery of the 
     property to the Government or to a common carrier;
       (2) in the case of property or services for which payment 
     is due before the Government's acceptance of the property or 
     services, the vendor provides commercial or other appropriate 
     warranties assuring that the property or services purchased 
     conform to the requirements set forth in the Government's 
     purchase offer; and
       (3) funds are available for making the payment.
       (c) Disbursements To Be Matched With Obligations.--The 
     simplified acquisition procedures shall include procedures 
     that ensure that each request for a disbursement is matched 
     with a particular obligation before the disbursement is made 
     under the payment terms provided for under subsection (a).

     SEC. 4014. PROCUREMENT NOTICE.

       (a) Continuation of Existing Notice Thresholds.--Subsection 
     (a) of section 18 of the Office of Federal Procurement Policy 
     Act (41 U.S.C. 416) is amended--
       (1) in paragraph (1), by striking out ``the small purchase 
     threshold'' each place it appears and inserting in lieu 
     thereof ``$25,000''; and
       (2) in paragraph (3)(B), by inserting after ``(B)'' the 
     following: ``in the case of a contract or order expected to 
     exceed the simplified acquisition threshold,''.
       (b) Content of Notice.--Subsection (b) of such section is 
     amended--
       (1) by striking out ``and'' at the end of paragraph (4);
       (2) by striking out the period at the end of paragraph (5) 
     and inserting in lieu thereof a semicolon; and
       (3) by adding at the end the following:
       ``(6) in the case of a contract in an amount estimated to 
     exceed $25,000 but not to exceed the simplified acquisition 
     threshold--
       ``(A) a description of the procedures to be used in 
     awarding the contract; and
       ``(B) a statement specifying the periods for prospective 
     offerors and the contracting officer to take the necessary 
     preaward and award actions.''.
       (c) Notice Not Required in Electronic Commerce.--Subsection 
     (c)(1) of such section, as amended by section 1055(b), is 
     further amended--
       (1) by redesignating subparagraphs (A), (B), (C), (D), (E) 
     and (F) as subparagraphs (B), (C), (D), (E), (F), and (G), 
     respectively; and
       (2) by inserting above subparagraph (B), as so 
     redesignated, the following new subparagraph (A):
       ``(A) the proposed procurement is conducted by means of 
     electronic commerce pursuant to a system that, as determined 
     by the Administrator for Federal Procurement Policy, has the 
     capabilities described in subsections (a) and (b) of section 
     4015 of the Federal Acquisition Streamlining Act of 1994;''.
       (d) Notice Under the Small Business Act.--
       (1) Continuation of existing notice thresholds.--Subsection 
     (e) of section 8 of the Small Business Act (15 U.S.C. 637) is 
     amended--
       (A) in paragraph (1), by striking out ``the small purchase 
     threshold'' each place it appears and inserting in lieu 
     thereof ``$25,000''; and
       (B) in paragraph (3)(B), by inserting after ``(B)'' the 
     following: ``in the case of a contract or order estimated to 
     exceed the simplified acquisition threshold,''.
       (2) Content of notice.--Subsection (f) of such section is 
     amended--
       (A) by striking out ``and'' at the end of paragraph (4);
       (B) by striking out the period at the end of paragraph (5) 
     and inserting in lieu thereof a semicolon; and
       (C) by adding at the end the following:
       ``(6) in the case of a contract in an amount estimated to 
     exceed the $25,000 but not to exceed the simplified 
     acquisition threshold--
       ``(A) a description of the procedures to be used in 
     awarding the contract; and
       ``(B) a statement specifying the periods for prospective 
     offerors and the contracting officer to take the necessary 
     preaward and award actions.''.

     SEC. 4015. ELECTRONIC COMMERCE FOR FEDERAL GOVERNMENT 
                   PROCUREMENTS.

       (a) Development and Implementation of System.--The 
     Administrator for Federal Procurement Policy, in consultation 
     with the heads of appropriate Federal Government agencies 
     having applicable technical and functional expertise, may 
     take appropriate steps to develop and implement a Federal 
     Governmentwide architecture or design for electronic commerce 
     that provides interoperability among users.
       (b) Required Capabilities.--The requirements analysis 
     prepared to implement the architecture or design of a system 
     of electronic commerce referred to in subsection (a) shall 
     have the following capabilities:
       (1) The maximum practicable capability for electronic 
     exchange of such procurement information as solicitations, 
     offers, contracts, purchase orders, invoices, payments, and 
     other contractual documents between the private sector and 
     the Federal Government.
       (2) Capabilities that increase the access of businesses, 
     including small business concerns, socially and economically 
     disadvantaged small business concerns, and businesses owned 
     predominantly by women, to Federal Government procurement 
     opportunities.
       (3) Easy access for potential Federal Government 
     contractors.
       (4) Use of nationally and internationally recognized data 
     formats that broaden and ease electronic interchange of data.
       (5) Use of Federal Government systems and networks and 
     industry systems and networks.
       (c) Notice and Solicitation Regulations.--In connection 
     with implementation of the architecture or design referred to 
     in subsection (a), the Federal Acquisition Regulatory Council 
     shall ensure that the Federal Acquisition Regulation contains 
     appropriate notice and solicitation provisions applicable to 
     acquisitions conducted through such architecture or design. 
     The provisions shall specify the required form and content of 
     notices of acquisitions and the minimum periods for 
     notifications of solicitations and for deadlines for the 
     submission of offers under solicitations. Each minimum period 
     specified for a notification of solicitation and each 
     deadline for the submission of offers under a solicitation 
     shall afford potential offerors a reasonable opportunity to 
     respond.
       (d) Limitation of Publication Requirement.--The requirement 
     in section 18(a) of the Office of Federal Procurement Policy 
     Act (41 U.S.C. 416(a)) and section 8(e) of the Small Business 
     Act (15 U.S.C. 637(e)) for publishing notice of a 
     solicitation in the Commerce Business Daily shall not apply 
     to acquisitions of a Federal agency or a component of a 
     Federal agency that are made through electronic commerce and 
     have a value not in excess of the simplified acquisition 
     threshold if the Federal Acquisition Regulation contains the 
     provisions specifically required by subsection (c) and the 
     Administrator for Federal Procurement Policy certifies that 
     such agency or component--
       (1) has fully implemented the architecture or design 
     referred to in subsection (a); and
       (2) has procedures in place--
       (A) to provide notice to potential offerors in accordance 
     with the requirements of the Federal Acquisition Regulation 
     prescribed pursuant to subsection (c); and
       (B) to ensure that small business concerns are afforded an 
     opportunity to respond to a solicitation of contract offers 
     within the period specified in the solicitation.
       (e) Definition.--In this section, the term ``simplified 
     acquisition threshold'' has the meaning given that term is 
     section 4(11) of the Office of Federal Procurement Policy Act 
     (41 U.S.C. 403(11)).

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

     SEC. 4021. FUTURE ENACTED PROCUREMENT LAWS.

       The Office of Federal Procurement Policy Act (41 U.S.C. 401 
     et seq.), as amended by section 4011, is further amended by 
     adding at the end the following new section:


 ``applicability of certain laws to contracts not exceeding simplified 
                         acquisition threshold

       ``Sec. 30. (a) In General.--The applicability of a 
     provision of law described in subsection (b) to contracts not 
     in excess of the simplified acquisition threshold may be 
     waived on a class basis in the Federal Acquisition 
     Regulation. Such a waiver shall not apply to a provision of 
     law that expressly refers to this section and prohibits the 
     waiver of that provision of law.
       ``(b) Referenced Law.--A provision of law referred to in 
     subsection (a) is any provision of law enacted after the date 
     of the enactment of the Federal Acquisition Streamlining Act 
     of 1994 that, as determined by the Administrator for Federal 
     Procurement Policy, sets forth policies, procedures, 
     requirements, or restrictions for the procurement of property 
     or services by the Federal Government.''.

     SEC. 4022. ARMED SERVICES ACQUISITIONS.

       (a) Requirement for Contract Clause Regarding Contingent 
     Fees.--Section 2306(b) of title 10, United States Code, is 
     amended by adding at the end the following: ``This subsection 
     does not apply to a contract that is not in excess of the 
     simplified acquisition threshold.''.
       (b) Prohibition on Limiting Subcontractor Direct Sales to 
     the United States.--Section 2402 of title 10, United States 
     Code, is amended by adding at the end the following new 
     subsection:
       ``(c) This section does not apply to a contract that is not 
     in excess of the simplified acquisition threshold (as defined 
     in section 4(11) of the Office of Federal Procurement Policy 
     Act (41 U.S.C. 403(11))).''.
       (c) Authority To Examine Books and Records of 
     Contractors.--Section 2313 of title 10, United States Code, 
     as amended by section 2201, is further amended by adding at 
     the end of subsection (f) the following:
       ``(2) A contract that is not in excess of the simplified 
     acquisition threshold.''.
       (d) Requirement To Identify Suppliers and Sources of 
     Supplies.--Section 2384(b) of title 10, United States Code, 
     is amended by adding at the end the following new paragraph:
       ``(3) The regulations prescribed pursuant to paragraph (1) 
     do not apply to a contract that does not exceed the 
     simplified acquisition threshold (as defined in section 4(11) 
     of the Office of Federal Procurement Policy Act (41 U.S.C. 
     403(11))).''.
       (e) Prohibition Against Doing Business With Certain 
     Offerors or Contractors.--Section 2393(d) of title 10, United 
     States Code, is amended in the second sentence by striking 
     out ``above'' and all that follows and inserting in lieu 
     thereof ``in excess of the simplified acquisition threshold 
     (as defined in section 4(11) of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 403(11))).''.
       (f) Prohibition on Persons Convicted of Defense-Contract 
     Related Felonies.--Section 2408(a) of title 10, United States 
     Code, is amended by adding at the end the following new 
     paragraph:
       ``(4) The prohibition in paragraph (1) does not apply with 
     respect to the following:
       ``(A) A contract referred to in subparagraph (A), (B), (C), 
     or (D) of such paragraph that is not in excess of the 
     simplified acquisition threshold (as defined in section 4(11) 
     of the Office of Federal Procurement Policy Act (41 U.S.C. 
     403(11))).
       ``(C) A subcontract referred to in such subparagraph that 
     is under a contract described in subparagraph (A).''.

     SEC. 4023. CIVILIAN AGENCY ACQUISITIONS.

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

     SEC. 4024. ACQUISITIONS GENERALLY.

       (a) Limitation on Use of Funds To Influence Certain Federal 
     Actions.--Section 1352(e)(2)(B) of title 31, United States 
     Code, is amended by striking out ``$100,000'' and inserting 
     in lieu thereof ``the simplified acquisition threshold (as 
     defined in section 4(11) of the Office of Federal Procurement 
     Policy Act (41 U.S.C. 403(11)))''.
       (b) Requirement for Contract Clause Relating to 
     Kickbacks.--Section 7 of the Anti-Kickback Act of 1986 (41 
     U.S.C. 57) is amended by adding at the end the following new 
     subsection:
       ``(d) Subsections (a) and (b) do not apply to a prime 
     contract that is not in excess of the simplified acquisition 
     threshold (as defined in section 4(11) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403(11))).''.
       (c) Miller Act.--
       (1) In general.--
       (A) Contracts not exceeding simplified acquisition 
     threshold.--The Act of August 24, 1935 (40 U.S.C. 270a et 
     seq.), commonly referred to as the ``Miller Act'', is amended 
     by adding at the end the following new section:
       ``Sec. 5. This Act does not apply to a contract in an 
     amount that is not in excess of the simplified acquisition 
     threshold (as defined in section 4(11) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403(11))).''.
       (B) Conforming amendment.--Subsection (a) of the first 
     section of such Act is amended by striking out ``, exceeding 
     $25,000 in amount,''.
       (2) Alternative payment protections.--
       (A) Protections to be specified in the far.--The Federal 
     Acquisition Regulation shall provide alternatives to payment 
     bonds as payment protections for suppliers of labor and 
     materials under contracts referred to in subparagraph (C).
       (B) Use of authorized protections.--The contracting officer 
     for a contract shall--
       (i) select, from among the payment protections provided for 
     in the Federal Acquisition Regulation pursuant to 
     subparagraph (A), one or more payment protections which the 
     offeror awarded the contract is to submit to the Federal 
     Government for the protection of suppliers of labor and 
     materials for such contract; and
       (ii) specify in the solicitation of offers for such 
     contract the payment protection or protections so selected.
       (C) Covered contracts.--
       (i) Applicability.--The regulations required under 
     subparagraph (A) and the requirements of subparagraph (B) 
     apply with respect to contracts referred to in subsection (a) 
     of the first section of the Miller Act that are in excess of 
     $25,000 but not in excess of the simplified acquisition 
     threshold (as defined in section 4(11) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403(11))).
       (ii) Miller act reference.--The Miller Act referred to in 
     subparagraph (A) is the Act of August 24, 1935 (40 U.S.C. 
     270a et seq.), commonly referred to as the ``Miller Act''.
       (d) Contract Work Hours and Safety Standards Act.--
       (1) In general.--Section 103 of the Contract Work Hours and 
     Safety Standards Act (40 U.S.C. 329) is amended by adding at 
     the end the following new subsection:
       ``(c) This title does not apply to a contract in an amount 
     that is not in excess of the simplified acquisition threshold 
     (as defined in section 4(11) of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 403(11))).''.
       (2) Conforming amendment.--Section 107(a) of such Act (40 
     U.S.C. 333(a)) is amended by inserting after ``It shall be a 
     condition of each contract'' the following: ``(other than a 
     contract referred to in section 103(c))''.
       (e) Drug-Free Workplace Act of 1988.--Section 5152(a)(1) of 
     the Drug-Free Workplace Act of 1988 (subtitle D of title V of 
     the Anti-Drug Abuse Act of 1988; Public Law 100-690; 41 
     U.S.C. 701(a)(1)) is amended by striking out ``of $25,000 or 
     more from any Federal agency'' and inserting in lieu thereof 
     ``in excess of the simplified acquisition threshold (as 
     defined in section 4(11) of such Act (41 U.S.C. 403(11))) by 
     any Federal agency''.
       (f) Certain Procurement Integrity Requirements.--
       (1) Certification requirement.--Subsection (e)(7)(A) of 
     section 27 of the Office of Federal Procurement Policy Act 
     (41 U.S.C. 423) is amended by striking out ``$100,000'' and 
     inserting in lieu thereof ``the simplified acquisition 
     threshold''.
        (2) Contract clause requirement.--Subsection (g)(1) of 
     such section is amended by inserting after ``awarded by a 
     Federal agency'' the following: ``(other than a contract in 
     an amount that is not in excess of the simplified acquisition 
     threshold)''.
       (g) Solid Waste Disposal Act.--Section 6002(a) of the Solid 
     Waste Disposal Act (42 U.S.C. 6962(a)) is amended by striking 
     out all that follows ``with respect to any'' and inserting in 
     lieu thereof ``contract in excess of the simplified 
     acquisition threshold (as defined in section 4(11) of the 
     Office of Federal Procurement Policy Act (41 U.S.C. 
     403(11))).''.

                     PART IV--CONFORMING AMENDMENTS

     SEC. 4071. ARMED SERVICES ACQUISITIONS.

       (a) Simplified Acquisition Procedures.--Section 2304(g) of 
     title 10, United States Code, is amended--
       (1) in paragraph (1), by striking out ``small purchases of 
     property and services'' and inserting in lieu thereof 
     ``purchases of property and services not in excess of the 
     simplified acquisition threshold'';
       (2) by striking out paragraph (2);
       (3) by redesignating paragraphs (3) and (4) as paragraphs 
     (2) and (3), respectively;
       (4) in paragraph (2), as so redesignated--
       (A) by striking out ``small purchase threshold'' and 
     inserting in lieu thereof ``simplified acquisition 
     threshold''; and
       (B) by striking out ``small purchase procedures'' and 
     inserting in lieu thereof ``simplified procedures''; and
       (5) in paragraph (3), as redesignated by paragraph (3), by 
     striking out ``small purchase procedures'' and inserting in 
     lieu thereof ``the simplified procedures''.
       (b) Solicitation Content Requirement.--Section 2305(a)(2) 
     of title 10, United States Code, is amended by striking out 
     ``small purchases)'' in the matter above subparagraph (A) and 
     inserting in lieu thereof ``purchases not in excess of the 
     simplified acquisition threshold)''.
       (c) Cost Type Contracts.--Section 2306(e)(2)(A) of title 
     10, United States Code, is amended by striking out ``small 
     purchase threshold'' and inserting in lieu thereof 
     ``simplified acquisition threshold''.

     SEC. 4072. CIVILIAN AGENCY ACQUISITIONS.

       (a) Simplified Acquisition Procedures.--
       (1) Property and services generally.--Section 303(g) of the 
     Federal Property and Administrative Services Act of 1949 (41 
     U.S.C. 253(g)) is amended--
       (A) in paragraph (1), by striking out ``small purchases of 
     property and services'' and inserting in lieu thereof 
     ``purchases of property and services not in excess of the 
     simplified acquisition threshold'';
       (B) by striking out paragraphs (2) and (5);
       (C) in paragraph (3)--
       (i) by striking out ``small purchase threshold'' and 
     inserting in lieu thereof ``simplified acquisition 
     threshold''; and
       (ii) by striking out ``small purchase procedures'' and 
     inserting in lieu thereof ``simplified procedures'';
       (E) in paragraph (4), by striking out ``small purchase 
     procedures'' and inserting in lieu thereof ``the simplified 
     procedures''; and
       (F) by inserting after paragraph (1) the following new 
     paragraph (2):
       ``(2)(A) The Administrator of General Services shall 
     prescribe regulations that provide special simplified 
     procedures for acquisitions of leasehold interests in real 
     property at rental rates that do not exceed the simplified 
     acquisition threshold.
       ``(B) For purposes of subparagraph (A), the rental rate or 
     rates under a multiyear lease do not exceed the simplified 
     acquisition threshold if the average annual amount of the 
     rent payable for the period of the lease does not exceed the 
     simplified acquisition threshold.''.
       (b) Solicitation Content Requirement.--Section 303A(b) of 
     the Federal Property and Administrative Services Act of 1949 
     (41 U.S.C. 253a(b)) is amended by striking out ``small 
     purchases)'' in the matter above paragraph (1) and inserting 
     in lieu thereof ``purchases not in excess of the simplified 
     acquisition threshold)''.
       (c) Cost Type Contracts.--Section 304(b) of the Federal 
     Property and Administrative Services Act of 1949 (41 U.S.C. 
     254(b)), as amended by section 1071, is further amended in 
     the second sentence by striking out ``either $25,000'' and 
     inserting in lieu thereof ``either the simplified acquisition 
     threshold''.

     SEC. 4073. OFFICE OF FEDERAL PROCUREMENT POLICY ACT.

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

     SEC. 4074. SMALL BUSINESS ACT.

       (a) Definition.--Section 3(m) of the Small Business Act (15 
     U.S.C. 632(m)) is amended by striking out ```small purchase 
     threshold''' and inserting in lieu thereof ```simplified 
     acquisition threshold'''.
       (b) Use of Simplified Acquisition Threshold Term.--Section 
     8(d)(2)(A) of the Small Business Act (15 U.S.C. 637(d)(2)(A)) 
     is amended by striking out ``small purchase threshold'' and 
     inserting in lieu thereof ``simplified acquisition 
     threshold''.

                    PART V--REVISION OF REGULATIONS

     SEC. 4081. REVISION REQUIRED.

       (a) Federal Acquisition Regulation.--The Federal 
     Acquisition Regulatory Council established by section 25(a) 
     of the Office of Federal Procurement Policy Act (41 U.S.C. 
     421(a)) shall review the Federal Acquisition Regulation to 
     identify regulations that are applicable to acquisitions in 
     excess of a specified amount that is less than $100,000. The 
     Council shall amend the regulations so identified as 
     necessary to provide that such regulations do not apply to 
     acquisitions that are not in excess of the simplified 
     acquisition threshold. The preceding sentence does not apply 
     in the case of a regulation for which such an amendment would 
     not be in the national interest, as determined by the 
     Council.
       (b) Supplemental Regulations.--The head of each Federal 
     agency that has issued regulations, policies, or procedures 
     referred to in section 25(c)(2) of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 421(c)(2)) shall identify 
     any such regulations, policies, or procedures that are 
     applicable to acquisitions in excess of a specified amount 
     that is less than $100,000. The agency head shall amend the 
     regulations so identified as necessary to provide that such 
     regulations, policies, and procedures do not apply to 
     acquisitions that are not in excess of the simplified 
     acquisition threshold. The preceding sentence does not apply 
     in the case of a regulation, policy, or procedure for which 
     such an amendment would not be in the national interest, as 
     determined by the agency head.
       (c) Completion of Actions.--All actions under this section 
     shall be completed not later than 180 days after the date of 
     the enactment of this Act.
       (d) Definitions.--In this section:
       (1) The term ``simplified acquisition threshold'' has the 
     meaning given such term in section 4(11) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403(11)), as 
     amended by section 4001.
       (2) The term ``Federal agency'' has the meaning given such 
     term in section 3(b) of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 472(b)).
           Subtitle B--Socioeconomic and Small Business Laws

     SEC. 4101. ACQUISITIONS GENERALLY.

       (a) Repeal of Executed Reporting Requirement.--Section 306 
     of the Trade Agreements Act of 1979 (19 U.S.C. 2516) is 
     repealed.
       (b) Walsh-Healey Act.--
       (1) Repeal other than for certain definitional purposes.--
     The Act of June 30, 1936 (41 U.S.C. 35 et seq.), commonly 
     referred to as the ``Walsh-Healey Act'', is amended to read 
     as follows:
       ``Section 1. (a) The Secretary of Labor may prescribe in 
     regulations the standards for determining whether a 
     contractor is a manufacturer of or a regular dealer in 
     materials, supplies, articles, or equipment to be 
     manufactured or used in the performance of a contract entered 
     into by any executive department, independent establishment, 
     or other agency or instrumentality of the United States, or 
     by the District of Columbia, or by any corporation all the 
     stock of which is beneficially owned by the United States, 
     for the manufacture or furnishing of materials, supplies, 
     articles, and equipment.
       ``(b) Any interested person shall have the right of 
     judicial review of any legal question regarding the 
     interpretation of the terms `regular dealer' and 
     `manufacturer', as defined pursuant to subsection (a).''
       (2) Conforming amendment.--Section 2304(h) of title 10, 
     United States Code, is amended to read as follows:
       ``(h) For the purposes of the Act entitled `An Act relating 
     to the rate of wages for laborers and mechanics employed on 
     public buildings of the United States and the District of 
     Columbia by contractors and subcontractors, and for other 
     purposes', approved March 3, 1931 (commonly referred to as 
     the `Davis-Bacon Act') (40 U.S.C. 276a et seq.), purchases or 
     contracts awarded after using procedures other than sealed-
     bid procedures shall be treated as if they were made with 
     sealed-bid procedures.''.
       (c) Repeal of Redundant Requirement Regarding Applicability 
     of the Davis-Bacon Act and the Walsh-Healey Act.--Section 308 
     of the Federal Property and Administrative Services Act of 
     1949 (41 U.S.C. 258) is repealed.

     SEC. 4102. ACQUISITIONS FROM SMALL BUSINESSES.

       (a) Set-Aside Priority.--Section 15 of the Small Business 
     Act (15 U.S.C. 644) is amended by striking out subsections 
     (e) and (f).
       (b) Certificate of Competence.--Section 804 of Public Law 
     103-484 (106 Stat. 2447; 10 U.S.C. 2305 note) is repealed.

     SEC. 4103. CONTRACTING PROGRAM FOR CERTAIN SMALL BUSINESS 
                   CONCERNS.

       (a) Procurement Procedures Authorized.--Section 8 of the 
     Small Business Act (15 U.S.C. 637) is amended by inserting 
     after subsection (b) the following new subsection:
       ``(c)(1) To facilitate the attainment of a goal for the 
     participation of small business concerns owned and controlled 
     by socially and economically disadvantaged individuals that 
     is established for a Federal agency pursuant to section 
     15(g)(1), the head of the agency may enter into contracts 
     using--
       ``(A) less than full and open competition by restricting 
     the competition for such awards to small business concerns 
     owned and controlled by socially and economically 
     disadvantaged individuals described in subsection (d)(3)(C) 
     of this section; and
       ``(B) a price evaluation preference not in excess of 10 
     percent when evaluating an offer received from such a small 
     business concern as the result of an unrestricted 
     solicitation.
       ``(2) Paragraph (1) does not apply to the Department of 
     Defense.''.
       (b) Implementation Through the Federal Acquisition 
     Regulation.--
       (1) In general.--The Federal Acquisition Regulation shall 
     be amended to provide for uniform implementation of the 
     authority provided in section 8(c) of the Small Business Act, 
     as added by subsection (a).
       (2) Matters to be addressed.--The provisions of the Federal 
     Acquisition Regulation prescribed pursuant to paragraph (1) 
     shall include--
       (A) conditions for the use of advance payments;
       (B) provisions for contract payment terms that provide 
     for--
       (i) accelerated payment for work performed during the 
     period for contract performance; and
       (ii) full payment for work performed;
       (C) guidance on how contracting officers may use, in 
     solicitations for various classes of products or services, a 
     price evaluation preference pursuant to section 8(c)(1)(B) of 
     the Small Business Act, as added by subsection (a), to 
     provide a reasonable advantage to small business concerns 
     owned and controlled by socially and economically 
     disadvantaged individuals without effectively eliminating any 
     participation of other small business concerns; and
       (D)(i) procedures for a person to request the head of 
     Federal agency to determine whether the use of competitions 
     restricted to small business concerns owned and controlled by 
     socially and economically disadvantaged individuals at a 
     contracting activity of such agency has caused a particular 
     industry category to bear a disproportionate share of the 
     contracts awarded to attain the goal established for that 
     contracting activity; and
       (ii) guidance for limiting the use of such restricted 
     competitions in the case of any contracting activity and 
     class of contracts determined in accordance with such 
     procedures to have caused a particular industry category to 
     bear a disproportionate share of the contracts awarded to 
     attain the goal established for that contracting activity.
       (c) Termination.--Section 8(c) of the Small Business Act, 
     as added by subsection (a), shall cease to be effective at 
     the end of September 30, 1999.

     SEC. 4104. PROCUREMENT GOALS FOR SMALL BUSINESS CONCERNS 
                   OWNED BY WOMEN.

       (a) Goals.--Section 15 of the Small Business Act (15 U.S.C. 
     644) is amended--
       (1) by striking out ``and small business concerns owned and 
     controlled by socially and economically disadvantaged 
     individuals'' each place it appears in the first sentence and 
     fourth sentences of subsection (g)(1), the second sentence of 
     subsection (g)(2), and paragraphs (1), (2)(A), (2)(D), and 
     (2)(E) of subsection (h) and inserting in lieu thereof ``, 
     small business concerns owned and controlled by socially and 
     economically disadvantaged individuals, and small business 
     concerns owned and controlled by women'';
       (2) in subsection (g)--
       (A) by inserting after the third sentence of paragraph (1) 
     the following: ``The Government-wide goal for participation 
     by small business concerns owned and controlled by women 
     shall be established at not less than 5 percent of the total 
     value of all prime contract and subcontract awards for each 
     fiscal year.'';
       (B) in the first sentence of paragraph (2), by striking out 
     ``and by small business concerns owned and controlled by 
     socially and economically disadvantaged individuals,'' and 
     inserting in lieu thereof ``, by small business concerns 
     owned and controlled by socially and economically 
     disadvantaged individuals, and by small business concerns 
     owned and controlled by women''; and
       (C) in the fourth sentence of paragraph (2), by inserting 
     after ``including participation by small business concerns 
     owned and controlled by socially and economically 
     disadvantaged individuals'' the following: ``and by 
     participation small business concerns owned and controlled by 
     women''; and
       (3) in subsection (h)(2)(F), by striking out ``women-owned 
     small business enterprises'' and inserting in lieu thereof 
     ``small business concerns owned and controlled by women''.
       (b) Subcontract Participation.--Section 8(d) of such Act 
     (15 U.S.C. 637(d)) is amended--
       (1) by striking out ``and small business concerns owned and 
     controlled by socially and economically disadvantaged 
     individuals'' both places it appears in paragraph (1), both 
     places it appears in paragraph (3)(A), in paragraph (4)(D), 
     in subparagraphs (A), (C), and (F) of paragraph (6), and in 
     paragraph (10)(B) and inserting in lieu thereof ``, small 
     business concerns owned and controlled by socially and 
     economically disadvantaged individuals, and small business 
     concerns owned and controlled by women'';
       (2) by striking out subparagraph (D) in paragraph (3) and 
     inserting in lieu thereof the following:
       ``(E) Contractors acting in good faith may rely on written 
     representations by their subcontractors regarding their 
     status as either a small business concern, a small business 
     concern owned and controlled by socially and economically 
     disadvantaged individuals, or a small business concern owned 
     and controlled by women.'';
       (3) in paragraph (3), by inserting after subparagraph (C) 
     the following new subparagraph (D):
       ``(D) The term `small business concern owned and controlled 
     by women' shall mean a small business concern--
       ``(i) which is at least 51 per centum owned by one or more 
     women; or, in the case of any publicly owned business, at 
     least 51 per centum of the stock of which is owned by one or 
     more women; and
       ``(ii) whose management and daily business operations are 
     controlled by one or more women.''; and
       (4) in paragraph (4)(E), by inserting ``and for small 
     business concerns owned and controlled by women'' after ``as 
     defined in paragraph (3) of this subsection''.
       (c) Misrepresentations of Status.--(1) Subsection (d)(1) of 
     section 16 of such Act (15 U.S.C. 645) is amended by striking 
     out ``or `small business concern owned and controlled by 
     socially and economically disadvantaged individuals''' and 
     inserting in lieu thereof ``, a `small business concern owned 
     and controlled by socially and economically disadvantaged 
     individuals', or a `small business concerns owned and 
     controlled by women'''.
       (2) Subsection (e) of such section is amended by striking 
     out ``or `small business concern owned and controlled by 
     socially and economically disadvantaged individuals''' and 
     inserting in lieu thereof ``, a `small business concern owned 
     and controlled by socially and economically disadvantaged 
     individuals', or a `small business concerns owned and 
     controlled by women'''.
       (d) Definition.--Section 3 of such Act (15 U.S.C. 632) is 
     amended by adding at the end the following new subsection:
       ``(n) For the purposes of this Act, a small business 
     concern is a small business concern owned and controlled by 
     women if--
       ``(1) at least 51 percent of small business concern is 
     owned by one or more women or, in the case of any publicly 
     owned business, at least 51 percent of the stock of which is 
     owned by one or more women; and
       ``(2) the management and daily business operations of the 
     business are controlled by one or more women.''.

     SEC. 4105. DEVELOPMENT OF DEFINITIONS REGARDING CERTAIN SMALL 
                   BUSINESS CONCERNS.

       (a) Review Required.--
       (1) Definitions to be identified.--The Administrator for 
     Federal Procurement Policy shall conduct a comprehensive 
     review of Federal laws, as in effect on November 1, 1994, to 
     identify and catalogue all of the provisions in such laws 
     that define (or describe for definitional purposes) the small 
     business concerns set forth in paragraph (2) for purposes of 
     authorizing the participation of such small business concerns 
     as prime contractors or subcontractors in--
       (A) contracts awarded directly by the Federal Government or 
     subcontracts awarded under such contracts; or
       (B) contracts and subcontracts funded, in whole or in part, 
     by Federal financial assistance under grants, cooperative 
     agreements, or other forms of Federal assistance.
       (2) Covered small business concerns.--The small business 
     concerns referred to in paragraph (1) are as follows:
       (A) Small business concerns owned and controlled by 
     socially and economically disadvantaged individuals.
       (B) Minority-owned small business concerns.
       (C) Small business concerns owned and controlled by women.
       (D) Woman-owned small business concerns.
       (b) Matters To Be Developed.--On the basis of the results 
     of the review carried out under subsection (a), the 
     Administrator for Federal Procurement Policy shall develop--
       (1) uniform definitions for the small business concerns 
     referred to in subsection (a)(2);
       (2) uniform agency certification standards and procedures 
     for--
       (A) determinations of whether a small business concern 
     qualifies as a small business concern referred to in 
     subsection (a)(2) under an applicable standard for purposes 
     contracts and subcontracts referred to in subsection (a)(1); 
     and
       (B) reciprocal recognition by an agency of a decision of 
     another agency regarding whether a small business concern 
     qualifies as a small business concern referred to in 
     subsection (a)(2) for such purposes; and
       (3) such other related recommendations as the Administrator 
     determines appropriate consistent with the review results.
       (c) Procedures and Schedule.--
       (1) Participation by certain interested parties.--The 
     Administrator for Federal Procurement Policy shall provide 
     for the participation in the review and activities under 
     subsections (a) and (b) by representatives of--
       (A) the Small Business Administration (including the Office 
     of the Chief Counsel for Advocacy);
       (B) the Minority Business Development Agency of the 
     Department of Commerce;
       (C) the Department of Transportation;
       (D) the Environmental Protection Agency; and
       (E) such other executive departments and agencies as the 
     Administrator considers appropriate.
       (2) Consultation with certain interested parties.--In 
     carrying out subsections (a) and (b), the Administrator shall 
     consult with representatives of organizations representing--
       (A) minority-owned business enterprises;
       (B) women-owned business enterprises; and
       (C) other organizations that the Administrator considers 
     appropriate.
       (3) Schedule.--Not later than 60 days after the date of the 
     enactment of this Act, the Administrator shall publish in the 
     Federal Register a notice which--
       (A) lists the provisions of law identified in the review 
     carried out under subsection (a);
       (B) describes the matters to be developed on the basis of 
     the results of the review pursuant to subsection (b);
       (C) solicits public comment regarding the matters described 
     in the notice pursuant to subparagraphs (A) and (B) for a 
     period of not less than 60 days; and
       (D) addresses such other matters as the Administrator 
     considers appropriate to ensure the comprehensiveness of the 
     review and activities under subsections (a) and (b).
       (d) Report.--Not later than May 1, 1995, the Administrator 
     for Federal Procurement Policy shall submit to the Committees 
     on Small Business of the Senate and the House of 
     Representatives a report on the results of the review carried 
     out under subsection (a) and the actions taken under 
     subsection (b). The report shall include a discussion of the 
     results of the review, a description of the consultations 
     conducted and public comments received, and the 
     Administrator's recommendations with regard to the matters 
     identified under subsection (b).
               Subtitle C--Miscellaneous Acquisition Laws

     SEC. 4151. PROHIBITION ON USE OF FUNDS FOR DOCUMENTING 
                   ECONOMIC OR EMPLOYMENT IMPACT OF CERTAIN 
                   ACQUISITION PROGRAMS.

       (a)  Revision and Codification.--
       (1) In general.--Subchapter I of chapter 134 of title 10, 
     United States Code, is amended by adding at the end the 
     following new section:

     ``Sec. 2247. Prohibition on use of funds for documenting 
       economic or employment impact of certain acquisition 
       programs

       ``No funds appropriated by the Congress may be obligated or 
     expended to assist any contractor of the Department of 
     Defense in preparing any material, report, lists, or analysis 
     with respect to the actual or projected economic or 
     employment impact in a particular State or congressional 
     district of an acquisition program for which all research, 
     development, testing, and evaluation has not been 
     completed.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of such subchapter is amended by adding at the end 
     the following new item:

``2247. Prohibition on use of funds for documenting economic or 
              employment impact of certain acquisition programs.''.

       (b) Repeal of Superseded Law.--Section 9048 of Public Law 
     102-396 (106 Stat. 1913) is repealed.

     SEC. 4152. RESTRICTION ON USE OF NONCOMPETITIVE PROCEDURES 
                   FOR PROCUREMENT FROM A PARTICULAR SOURCE.

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

     SEC. 5001. PERFORMANCE BASED MANAGEMENT.

       (a) Policy and Goals for Performance Based Management of 
     Programs.--
       (1) In general.--Chapter 131 of title 10, United States 
     Code, is amended by adding at the end the following new 
     section:

     ``Sec. 2219. Performance based management: acquisition 
       programs

       ``(a) Congressional Policy.--It is the policy of Congress 
     that--
       ``(1) the Department of Defense should achieve, on average, 
     90 percent of the cost and schedule goals established for the 
     research and development programs and acquisition programs of 
     the Department of Defense without reducing the performance or 
     capabilities of the items being acquired; and
       ``(2) the average period necessary for converting an 
     emerging technology into initial operational capability for 
     the Department of Defense should not exceed 8 years.
       ``(b) Establishment of Goals.--(1) The Secretary of Defense 
     shall approve or define the cost, performance, and schedule 
     goals for major defense acquisition programs of the 
     Department of Defense.
       ``(2) The Comptroller of the Department of Defense shall 
     evaluate the cost goals proposed for each major defense 
     acquisition program of the Department.
       ``(c) Identification of Noncompliant Programs.--Whenever it 
     is necessary to do so in order to implement the policy set 
     out in subsection (a), the Secretary of Defense shall--
       ``(1) identify and consider whether there is a continuing 
     need for programs that are significantly behind schedule, 
     over budget, or not in compliance with performance or 
     capability requirements taking into consideration--
       ``(A) the needs of the Department known as of the time of 
     consideration;
       ``(B) the state of the technology or technologies relevant 
     to the programs and to the needs of the Department;
       ``(C) the estimated costs and projected schedules necessary 
     for the completion of such programs; and
       ``(D) other pertinent information; and
       ``(2) identify existing and potential research and 
     development programs and acquisition programs that are 
     suitable alternatives for programs considered pursuant to 
     paragraph (1).
       ``(d) Annual Reporting Requirement.--The Secretary of 
     Defense shall include in the annual report submitted to 
     Congress pursuant to section 113(c) of this title an 
     assessment of the progress made in implementing the policy 
     stated in subsection (a). The Secretary shall use data from 
     existing management systems in making the assessment.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of such chapter is amended by adding at the end the 
     following new item:

``2219. Performance based management: acquisition programs.''.

       (b) Enhanced System of Performance Incentives.--Within one 
     year after the date of the enactment of this Act, the 
     Secretary of Defense shall review the incentives and 
     personnel actions available to the Secretary for encouraging 
     excellence in the defense acquisition workforce and provide 
     an enhanced system of incentives for the encouragement of 
     excellence in such workforce. The enhanced system of 
     incentives shall, to the maximum extent consistent with 
     applicable law--
       (1) relate pay to performance (including the extent to 
     which the performance of personnel in such workforce 
     contributes to achieving the cost goals, schedule goals, and 
     performance goals established for acquisition programs of the 
     department pursuant to section 2219(b) of title 10, as added 
     by subsection (a)); and
       (2) provide for consideration, in personnel evaluations and 
     promotion decisions, of the extent to which the performance 
     of personnel in such workforce contributes to achieving the 
     cost goals, schedule goals, and performance goals established 
     for acquisition programs of the department pursuant to 
     section 2219(b) of title 10, United States Code, as added by 
     subsection (a).
       (c) Recommended Legislation.--Not later than one year after 
     the date of the enactment of this Act, the Secretary of 
     Defense shall submit to Congress any recommended legislation 
     that the Secretary considers necessary to carry out section 
     2219 of title 10, United States Code, as added by subsection 
     (a), and otherwise to facilitate and enhance management of 
     Department of Defense acquisition programs and the defense 
     acquisition workforce on the basis of performance.

     SEC. 5002. RESULTS ORIENTED ACQUISITION PROGRAM CYCLE.

       The Secretary of Defense shall define in regulations a 
     simplified acquisition program cycle that is results-
     oriented. The Secretary shall consider including in the 
     regulations provisions for the following:
       (1) Program phases as follows:
       (A) An integrated decision team meeting which--
       (i) may be requested by a potential user of the system or 
     component to be acquired, the head of a laboratory, or a 
     program office on such bases as the emergence of a new 
     military requirement, cost savings opportunity, or new 
     technology opportunity;
       (ii) is conducted by an acquisition program executive 
     officer; and
       (iii) is usually completed within 1 to 3 months.
       (B) A prototype development and testing phase which--
       (i) includes operational tests and concerns relating to 
     manufacturing operations and life cycle support;
       (ii) is usually completed within 6 to 36 months; and
       (iii) produces sufficient numbers of prototypes to assess 
     operational utility.
       (C) Product integration, development, and testing which--
       (i) includes full-scale development, operational testing, 
     and integration of components; and
       (ii) is usually completed within 1 to 5 years.
       (D) Production, integration into existing systems, or 
     production and integration into existing systems.
       (2) An acquisition program approval process for major 
     program decisions which consists of the following:
       (A) One major decision point--
       (i) which occurs for an acquisition program before the 
     program proceeds into product integration and development; 
     and
       (ii) at which the Under Secretary of Defense for 
     Acquisition and Technology, in consultation with the Vice 
     Chairman of the Joint Chiefs of Staff reviews the program, 
     determines whether the program should continue to be carried 
     out beyond product integration and development, and decides 
     whether to commit to further development, to require further 
     prototyping, or to terminate the program.
       (B) Consideration of the potential benefits, affordability, 
     needs, and risks of an acquisition program in the review of 
     the acquisition program.

     SEC. 5003. DEFENSE ACQUISITION PILOT PROGRAM DESIGNATIONS.

       (a) Programs and Waivers.--The National Defense 
     Authorization Act for Fiscal Year 1994 (Public Law 103-160) 
     is amended by inserting the following new section at the end 
     of subtitle D of title VIII:

     ``SEC. 840. DEFENSE ACQUISITION PILOT PROGRAM DESIGNATIONS.

       ``(a) Eligible Programs.--The Secretary of Defense is 
     authorized to designate the following defense acquisition 
     programs for participation in the defense acquisition pilot 
     program authorized by section 809 of the National Defense 
     Authorization Act for Fiscal Year 1991 (10 U.S.C. 2430 note):
       ``(1) Defense Personnel Support Center medical, clothing 
     and textile, and subsistence programs with respect to the 
     following:
       ``(A) All contracts for processed fruits and vegetables and 
     frozen seafood items for both depot stock and direct vendor 
     delivery.
       ``(B) All contracts in the subsistence prime vendor program 
     for grocery items.
       ``(C) All contracts in the Mail Order Pharmacy Program, the 
     prime vendor programs for pharmaceuticals and for medical 
     surgical items for delivery to military hospitals.
       ``(D) All contracts in the medical electronic commerce 
     program for acquisition for depot stock and direct vendor 
     delivery.
       ``(E) All contracts for the following items: dress coats 
     (small lots), dress coats, duffel bags, Navy work clothing, 
     general purpose tents, suitcases, gloves for electrical 
     workers, boot flyers, socks, drawers, undershirts, and items 
     offered under the Broad Agency Announcements for Clothing and 
     Textiles Advanced Business Practices Demonstration Program.
       ``(2) The Fire Support Combined Arms Tactical Trainer 
     program with respect to all contracts directly related to the 
     procurement of a training system (including related hardware, 
     software, and subsystems) to perform collective training of 
     field artillery gunnery team components with development of 
     software as required to generate the training exercises and 
     component interfaces.
       ``(3) The Joint Direct Attack Munition program (JDAM I) 
     with respect to all contracts directly related to the 
     development and procurement of a strap-on guidance kit, using 
     an inertially guided, Global Positioning System updated 
     guidance kit for inventory 1,000 and 2,000 pound bombs.
       ``(4) The Joint Primary Aircraft Training System (JPATS) 
     with respect to all contracts directly related to the 
     acquisition of a new primary trainer aircraft to fulfill Air 
     Force and Navy joint undergraduate aviation training 
     requirements, and an associated ground-based training system 
     consisting of air crew training devices (simulators), 
     courseware, a Training Management System, and contractor 
     support for the life of the system.
       ``(5) The Commercial Derivatives Aircraft program with 
     respect to all contracts directly related to the acquisition 
     or upgrading of civil-derivative aircraft for use in (A) 
     foreign military sales of Airborne Warning and Control 
     Systems to foreign governments with modifications of a type 
     customarily provided to commercial customers, or (B) future 
     Air Force airlift and tanker requirements.
       ``(6) The Commercial Derivative Engine program with respect 
     to all contracts directly related to the acquisition of (A) 
     commercially derived engines (including spare engines), 
     logistics support equipment, technical orders, management 
     data, and initial spare parts for use in the C-17A production 
     line, and (B) commercially derived engines to support the 
     purchase of commercial-derivative aircraft to meet future Air 
     Force airlift and tanker requirements, including engine 
     replacement and upgrades.
       ``(b) Waiver Authority.--Subject to section 809(c) of the 
     National Defense Authorization Act for Fiscal Year 1991, the 
     Secretary of Defense is authorized--
       ``(1) to apply any amendment or repeal of a provision of 
     law made in the Federal Acquisition Streamlining Act of 1994 
     to the programs described in subsection (a) before the 
     effective date of such amendment or repeal; and
       ``(2) to apply to a procurement of noncommercial items 
     under such programs--
       ``(A) any authority provided in such Act (or in an 
     amendment made by a provision of such Act) to waive a 
     provision of law in the case of commercial items, and
       ``(B) any exception applicable under such Act (or an 
     amendment made by a provision of such Act) in the case of 
     commercial items,

     before the effective date of such provision (or amendment) to 
     the extent that the Secretary determines necessary to test 
     the application of such waiver or exception to procurements 
     of noncommercial items.
       ``(c) Pilot Program Implementation.--In exercising the 
     authority provided in section 809 of the National Defense 
     Authorization Act for 1991, and in accordance with sections 
     833 through 839 of this Act, the Secretary of Defense, shall 
     take the following actions:
       ``(1) Mission-oriented program management.--For one or more 
     of the defense acquisition programs designated for 
     participation in the defense acquisition pilot program, 
     prescribe and implement procedures which--
       ``(A) provide for interaction between the program manager 
     and the commander of the operational command responsible for 
     the requirement for the equipment acquired;
       ``(B) include provisions for a determination by the 
     commander that items proposed for procurement fulfill the 
     need defined in approved requirements documents; and
       ``(C) may include a role for the operational commander in 
     decision making for program milestone decisions and 
     performance of acceptance testing of items acquired.
       ``(2) Savings objectives.--Not later than 45 days after the 
     date of enactment of the Federal Acquisition Streamlining Act 
     of 1994, identify for each defense acquisition program 
     participating in the pilot program quantitative measures and 
     goals for reducing acquisition management costs.
       ``(3) Program phases.--For each defense acquisition program 
     participating in the pilot program, incorporate in an 
     approved acquisition strategy a program review process that 
     provides senior acquisition officials with reports that--
       ``(A) contain essential information on program results at 
     quarterly intervals;
       ``(B) reduce data requirements from the current major 
     program review reporting requirements; and
       ``(C) include data on program costs estimates, actual 
     expenditures, performance estimates, performance data from 
     tests, and, consistent with existing statutes, the minimum 
     necessary other data items required to ensure the appropriate 
     expenditure of funds appropriated for that program.
       ``(4) Program work force policies.--With regard to the 
     review of incentives and personnel actions required under 
     section 836 of this Act--
       ``(A) not later than 60 days after the date of the 
     enactment of the Federal Acquisition Streamlining Act of 
     1994--
       ``(i) complete the review; and
       ``(ii) on the basis of the review, define one or more 
     systems that relate incentives, including pay, to achievement 
     of budgets, schedules, and performance requirements;
       ``(B) not later than 120 days after the date of the 
     enactment of the Federal Acquisition Streamlining Act of 
     1994--
       ``(i) apply such a system of incentives to not less than 
     one defense acquisition program participating in the pilot 
     program; and
       ``(ii) provide for an assessment of the effectiveness of 
     that system; and
       ``(C) incorporate the results of actions taken pursuant to 
     this paragraph into the development of regulations for the 
     implementation of section 5001(b) of the Federal Acquisition 
     Streamlining Act of 1994.
       ``(5) Efficient contracting process.--Take any additional 
     actions that the Secretary considers necessary to waive 
     regulations, not required by statute, that affect the 
     efficiency of the contracting process, including, in the 
     Secretary's discretion, defining alternative techniques to 
     reduce reliance on military specifications and standards in 
     contracts for the defense acquisition programs participating 
     in the pilot program.
       ``(6) Contract administration: performance based contract 
     management.--For at least one participating defense 
     acquisition program for which a determination is made to make 
     payments for work in progress under the authority of section 
     2307 of title 10, United States Code, define payment 
     milestones on the basis of quantitative measures of results.
       ``(7) Contractor performance assessment.--Collect and 
     evaluate performance information on each contract entered 
     into for a defense acquisition program participating in the 
     pilot program, including information on cost, schedule, and 
     technical performance for each contractor supporting a 
     participating program.
       ``(d) Applicability.--(1) Subsection (b) applies with 
     respect to--
       ``(A) a contract that is awarded or modified during the 
     period described in paragraph (2); and
       ``(B) a contract that is awarded before the beginning of 
     such period and is to be performed (or may be performed), in 
     whole or in part, during such period.
       ``(2) The period referred to in paragraph (1) is the period 
     that begins 45 days after the date of the enactment of the 
     Federal Acquisition Streamlining Act of 1994 and ends on 
     September 30, 1998.''.
       (b) Rule of Construction.--Nothing in section 840 of the 
     National Defense Authorization Act for Fiscal Year 1994, as 
     added by subsection (a), shall be construed as authorizing 
     the appropriation or obligation of funds for the programs 
     designated for participation in the defense acquisition pilot 
     program under the authority of subsection (a) of such section 
     840.
                Subtitle B--Civilian Agency Acquisitions

     SEC. 5051. PERFORMANCE BASED MANAGEMENT.

       (a) Policy and Goals for Performance Based Management of 
     Programs.--
       (1) In general.--Title III of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 301 et seq.), 
     as amended by sections 1552 and 1553, is further amended by 
     adding at the end the following new section:


          ``performance based management: acquisition programs

       ``Sec. 311. (a) Congressional Policy.--It is the policy of 
     Congress that the head of each executive agency should 
     achieve, on average, 90 percent of the cost and schedule 
     goals established for the research and development programs 
     and acquisition programs of the agency without reducing the 
     performance or capabilities of the items being acquired.
       ``(b) Establishment of Goals.--(1) The head of each 
     executive agency shall approve or define the cost, 
     performance, and schedule goals for major acquisition 
     programs of the agency.
       ``(2) The chief financial officer of an executive agency 
     shall evaluate the cost goals proposed for each major defense 
     acquisition program of the agency.
       ``(c) Identification of Noncompliant Programs.--Whenever it 
     is necessary to do so in order to implement the policy set 
     out in subsection (a), the head of an executive agency 
     shall--
       ``(1) identify and consider whether there is a continuing 
     need for programs that are significantly behind schedule, 
     over budget, or not in compliance with performance or 
     capability requirements taking into consideration--
       ``(A) the needs of the agency known as of the time of 
     consideration;
       ``(B) the state of the technology or technologies relevant 
     to the programs and to the needs of the agency;
       ``(C) the estimated costs and projected schedules necessary 
     for the completion of such programs; and
       ``(D) other pertinent information; and
       ``(2) identify existing and potential research and 
     development programs and acquisition programs that are 
     suitable alternatives for programs considered pursuant to 
     paragraph (1).''.
       (2) Clerical amendment.--The table of contents in the first 
     section of such Act, as amended by sections 1552 and 1553, is 
     further amended by inserting after the item relating to 
     section 310 the following new item:

``Sec. 311. Performance based management: acquisition programs.''.

       (b) Annual Reporting Requirement.--Section 6 of the Office 
     of Federal Procurement Policy Act (41 U.S.C. 405), as amended 
     by section 1091, is further amended by adding at the end the 
     following new subsection:
       ``(k) The Administrator shall submit to Congress, on an 
     annual basis, an assessment of the progress made in executive 
     agencies in implementing the policy stated in section 311(a) 
     of the Federal Property and Administrative Services Act of 
     1949. The Administrator shall use data from existing 
     management systems in making the assessment.''.
       (c) Enhanced System of Performance Incentives.--Within one 
     year after the date of the enactment of this Act, the 
     Administrator for Federal Procurement Policy, in consultation 
     with appropriate officials in other departments and agencies 
     of the Federal Government, shall, to the maximum extent 
     consistent with applicable law--
       (1) establish policies and procedures for the heads of such 
     departments and agencies to designate acquisition positions 
     and manage employees (including the accession, education, 
     training and career development of employees) in the 
     designated acquisition positions;
       (2) extend to the acquisition workforce of the entire 
     executive branch the acquisition workforce policies contained 
     in chapter 87 of title 10, United States Code, relating to 
     the acquisition workforce of the Department of Defense; and
       (3) review the incentives and personnel actions available 
     to the heads of department and agencies of the Federal 
     Government for encouraging excellence in the acquisition 
     workforce of the Federal Government and provide an enhanced 
     system of incentives for the encouragement of excellence in 
     such workforce which--
       (A) relates pay to performance (including the extent to 
     which the performance of personnel in such workforce 
     contributes to achieving the cost goals, schedule goals, and 
     performance goals established for acquisition programs 
     pursuant to section 311(b) of the Federal Property and 
     Administrative Services Act of 1949, as added by subsection 
     (a)); and
       (B) provides for consideration, in personnel evaluations 
     and promotion decisions, of the extent to which the 
     performance of personnel in such workforce contributes to 
     achieving such cost goals, schedule goals, and performance 
     goals.
       (d) Recommended Legislation.--Not later than one year after 
     the date of the enactment of this Act, the Administrator for 
     Federal Procurement Policy shall submit to Congress any 
     recommended legislation that the Secretary considers 
     necessary to carry out section 311 of the Federal Property 
     and Administrative Services Act of 1949, as added by 
     subsection (a), and otherwise to facilitate and enhance 
     management of Federal Government acquisition programs and the 
     acquisition workforce of the Federal Government on the basis 
     of performance.

     SEC. 5052. RESULTS-ORIENTED ACQUISITION PROCESS.

       (a) Development of Process Required.--The Administrator for 
     Federal Procurement Policy, in consultation with the heads of 
     appropriate Federal agencies, shall develop a results-
     oriented acquisition process for implementation by agencies 
     in acquisitions of property and services by the Federal 
     agencies. The process shall include the identification of 
     quantitative measures and standards for determining the 
     extent to which an acquisition of noncommercial items by a 
     Federal agency satisfies the needs for which the items are 
     being acquired.
       (b) Inapplicability of Process to Department of Defense.--
     The process developed pursuant to subsection (a) may not be 
     applied to the Department of Defense.
                       Subtitle C--Miscellaneous

     SEC. 5091. CONTRACTOR EXCEPTIONAL PERFORMANCE AWARDS.

       The Office of Federal Procurement Policy Act, as amended by 
     section 4021, is further amended by adding at the end the 
     following:


              ``contractor exceptional performance awards

       ``Sec. 31. (a) Establishment.--There is hereby established 
     an executive branch program to recognize and promote 
     exceptional contract performance by Federal Government 
     contractors.
       ``(b) Selection.--(1) The Administrator shall ensure the 
     establishment of criteria for selection of contractors to 
     receive exceptional performance awards under the program.
       ``(2) The head of an executive agency may select one or 
     more agency contractors to receive an exceptional performance 
     award under the program.
       ``(c) Award Ceremony.--The Vice President, or the head of 
     the executive agency selecting a contractor for an 
     exceptional performance award, shall present the award to the 
     contractor with such ceremony as the Vice President or head 
     of the agency, as the case may be, considers appropriate.''.

     SEC. 5092. DEPARTMENT OF DEFENSE ACQUISITION OF INTELLECTUAL 
                   PROPERTY RIGHTS.

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

     SEC. 6001. AMENDMENTS TO OFFICE OF FEDERAL PROCUREMENT POLICY 
                   ACT.

       (a) Recusal.--Subsection (c) of section 27 of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 423) is amended--
       (1) in paragraph (1)--
       (A) in the matter above subparagraph (A), by inserting 
     ``only'' after ``subsection (b)(1)''; and
       (B) in subparagraph (A), by inserting ``(including the 
     modification or extension of a contract)'' after ``any 
     procurement'';
       (2) by striking out paragraphs (2) and (3) and inserting in 
     lieu thereof:
       ``(2) Whenever the head of a procuring activity approves a 
     recusal under paragraph (1), a copy of the recusal request 
     and the approval of the request shall be retained by such 
     official for a period (not less than five years) specified in 
     regulations prescribed in accordance with subsection (o).
       ``(3)(A) Except as provided in subparagraph (B), all 
     recusal requests and approvals of recusal requests pursuant 
     to this subsection shall be made available to the public on 
     request.
       ``(B) Any part of a recusal request or an approval of a 
     recusal request that is exempt from the disclosure 
     requirements of section 552 of title 5, United States Code, 
     under subsection (b)(1) of such section may be withheld from 
     disclosure to the public otherwise required under 
     subparagraph (A).''; and
       (3) in paragraph (4), by striking out ``competing 
     contractor'' and inserting in lieu thereof ``person''.
       (b) Applicability of Certification Requirement.--Subsection 
     (e)(7)(A) of such section is amended by adding at the end the 
     following: ``However, paragraph (1)(B) does not apply with 
     respect to a contract for less than $500,000.''.
       (c) Restrictions Resulting From Procurement Activities of 
     Procurement Officials.--Subsection (f) of such section is 
     amended--
       (1) by redesignating paragraph (3) as paragraph (4); and
       (2) by striking out paragraphs (1) and (2) and inserting in 
     lieu thereof the following:
       ``(1) No individual who, in the year prior to separation 
     from service as an officer or employee of the Government or 
     an officer of the uniformed services in a covered position, 
     participated personally and substantially in acquisition 
     functions related to a contract, subcontract, or claim of 
     $500,000 or more and--
       ``(A) engaged in repeated direct contact with the 
     contractor or subcontractor on matters relating to such 
     contract, subcontract, or claim; or
       ``(B) exercised significant ongoing decisionmaking 
     responsibility with respect to the contractor or 
     subcontractor on matters relating to such contract, 
     subcontract, or claim,

     shall knowingly accept or continue employment with such 
     contractor or subcontractor for a period of 1 year following 
     the individual's separation from service, except that such 
     individual may accept or continue employment with any 
     division or affiliate of such contractor or subcontractor 
     that does not produce the same or similar products as the 
     entity involved in the negotiation or performance of the 
     contract or subcontract or the adjustment of the claim.
       ``(2) No contractor or subcontractor, or any officer, 
     employee, agent, or consultant of such contractor or 
     subcontractor shall knowingly offer, provide, or continue any 
     employment for another person, if such contractor, 
     subcontractor, officer, employee, agent, or consultant knows 
     or should know that the acceptance of such employment is or 
     would be in violation of paragraph (1).
       ``(3) The head of each Federal agency shall designate in 
     writing as a `covered position' under this section each of 
     the following positions in that agency:
       ``(A) The position of source selection authority, member of 
     a source selection evaluation board, or chief of a financial 
     or technical evaluation team, or any other position, if the 
     officer or employee in that position is likely personally to 
     exercise substantial responsibility for ongoing discretionary 
     functions in the evaluation of proposals or the selection of 
     a source for a contract in excess of $500,000.
       ``(B) The position of procuring contracting officer, or any 
     other position, if the officer or employee in that position 
     is likely personally to exercise substantial responsibility 
     for ongoing discretionary functions in the negotiation of a 
     contract in excess of $500,000 or the negotiation or 
     settlement of a claim in excess of $500,000.
       ``(C) The position of program executive officer, program 
     manager, or deputy program manager, or any other position, if 
     the officer or employee in that position is likely personally 
     to exercise similar substantial responsibility for ongoing 
     discretionary functions in the management or administration 
     of a contract in excess of $500,000.
       ``(D) The position of administrative contracting officer, 
     the position of an officer or employee assigned on a 
     permanent basis to a Government Plant Representative's 
     Office, the position of auditor, a quality assurance 
     position, or any other position, if the officer or employee 
     in that position is likely personally to exercise substantial 
     responsibility for ongoing discretionary functions in the on-
     site oversight of a contractor's operations with respect to a 
     contract in excess of $500,000.
       ``(E) A position in which the incumbent is likely 
     personally to exercise substantial responsibility for ongoing 
     discretionary functions in operational or developmental 
     testing activities involving repeated direct contact with a 
     contractor regarding a contract in excess of $500,000.''.
       (d) Disclosure of Proprietary or Source Selection 
     Information to Unauthorized Persons.--Subsection (l) of such 
     section is amended--
       (1) by inserting ``who are likely to be involved in 
     contracts, modifications, or extensions in excess of 
     $25,000'' in the first sentence after ``its procurement 
     officials''; and
       (2) by striking out ``(e)'' each place it appears and 
     inserting in each such place ``(f)''.
       (e) Rules of Construction.--Subsection (n) of such section 
     is amended to read as follows:
       ``(n) Rules of Construction.--Nothing in this section shall 
     be construed to--
       ``(1) authorize the withholding of any information from the 
     Congress, any committee or subcommittee thereof, a Federal 
     agency, any board of contract appeals of a Federal agency, 
     the Comptroller General, or an inspector general of a Federal 
     agency;
       ``(2) restrict the disclosure of information to, or receipt 
     of information by, any person or class of persons authorized, 
     in accordance with applicable agency regulations or 
     procedures, to receive that information;
       ``(3) restrict a contractor from disclosing its own 
     proprietary information or the recipient of information so 
     disclosed by a contractor from receiving such information; or
       ``(4) restrict the disclosure or receipt of information 
     relating to a Federal agency procurement that has been 
     canceled by the agency and that the contracting officer 
     concerned determines in writing is not likely to be 
     resumed.''.
       (f) Term To Be Defined in Regulations.--Subsection 
     (o)(2)(A) of such section is amended--
       (1) by inserting ``money, gratuity, or other'' before 
     ``thing of value'''; and
       (2) by inserting before the semicolon ``and such other 
     exceptions as may be adopted on a Governmentwide basis under 
     section 7353 of title 5, United States Code''.
       (g) Terms Defined in Law.--Subsection (p) of such section 
     is amended--
       (1) in paragraph (1) by striking out ``clauses (i)-(viii)'' 
     and inserting in lieu thereof ``clauses (i) through (vii)'';
       (2) in paragraph (3)--
       (A) in subparagraph (A)--
       (i) by striking out clause (i);
       (ii) by redesignating clauses (ii), (iii), (iv), (v), (vi), 
     (vii), and (viii) as clauses (i), (ii), (iii), (iv), (v), 
     (vi), and (vii), respectively; and
       (iii) in clause (i) (as redesignated by subclause (II) of 
     this clause), by striking out ``review and approval of a 
     specification'' and inserting in lieu thereof ``approval or 
     issuance of a specification, acquisition plan, procurement 
     request, or requisition''; and
       (B) in subparagraph (B), by striking out all after 
     ``includes'' and inserting in lieu thereof the following: 
     ``any individual acting on behalf of, or providing advice to, 
     the agency with respect to any phase of the agency 
     procurement concerned, regardless of whether such individual 
     is a consultant, expert, or adviser, or an officer or 
     employee of a contractor or subcontractor (other than a 
     competing contractor).''; and
       (3) in paragraph (6)(A), by inserting ``nonpublic'' before 
     ``information''.

     SEC. 6002. AMENDMENTS TO TITLE 18, UNITED STATES CODE.

       Section 208(a) of title 18, United States Code, is 
     amended--
       (1) by inserting ``(1)'' before ``Except as permitted''; 
     and
       (2) by adding at the end the following new paragraph:
       ``(2) Whoever knowingly aids, abets, counsels, commands, 
     induces, or procures conduct prohibited by this section shall 
     be subject to the penalties set forth in section 216 of this 
     title.''.

     SEC. 6003. REPEAL OF SUPERSEDED AND OBSOLETE LAWS.

       (a) Repeal.--The following provisions of law are repealed:
       (1) Sections 2207, 2397, 2397a, 2397b, and 2397c of title 
     10, United States Code.
       (2) Section 281 of title 18, United States Code.
       (3) Section 801 of title 37, United States Code.
       (4) Part A of title VI of the Department of Energy 
     Organization Act (42 U.S.C. 7211 through 7218).
       (b) Clerical Amendments.--
       (1) Title 10.--Part IV of subtitle A of title 10, United 
     States Code, is amended--
       (A) in the table of sections at the beginning of chapter 
     131, by striking out the item relating to section 2207; and
       (B) in the table of sections for chapter 141, by striking 
     out the items relating to sections 2397, 2397a, 2397b, and 
     2397c.
       (2) Title 18.--The table of sections for chapter 15 of 
     title 18, United States Code, is amended by striking out the 
     item relating to section 281.
       (3) Title 37.--The table of sections for chapter 15 of 
     title 37, United States Code, is amended by striking out the 
     item relating to section 801.
       (4) Department of energy organization act.--The table of 
     contents for the Department of Energy Organization Act is 
     amended by striking out the matter relating to part A of 
     title VI.

     SEC. 6004. IMPLEMENTATION.

       (a) Regulations.--Not later than 180 days after the date of 
     the enactment of this Act, regulations implementing the 
     amendments made by section 6001 to section 27 of the Office 
     of Federal Procurement Policy Act (41 U.S.C. 423), including 
     definitions of the terms used in subsection (f) of such 
     section, shall be issued in accordance with sections 6 and 25 
     of such Act (41 U.S.C. 405 and 521) after coordination with 
     the Director of the Office of Government Ethics.
       (b) Savings Provisions.--
       (1) Contractor certifications.--No officer, employee, 
     agent, representative, or consultant of a contractor who has 
     signed a certification under section 27(e)(1)(B) of the 
     Office of Federal Procurement Policy Act (41 U.S.C. 
     423(e)(1)(B)) before the effective date of this Act shall be 
     required to sign a new certification as a result of the 
     enactment of this Act.
       (2) Federal procurement official certifications.--No 
     procurement official of a Federal agency who has signed a 
     certification under section 27(l) of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 423(l)) before the date of 
     enactment of this Act shall be required to sign a new 
     certification as a result of the enactment of this Act.
       (c) Inspector General Reports.--Not later than May 31 of 
     each of the years 1995 through 1998, the Inspector General of 
     each Federal agency (or, in the case of a Federal agency that 
     does not have an Inspector General, the head of such agency) 
     shall submit to Congress a report on the compliance by the 
     agency during the preceding year with the requirement for the 
     head of the agency to designate covered procurement positions 
     under section 27(f)(3) of the Office of Federal Procurement 
     Policy Act (as added by section 6001(c)).
                   Subtitle B--Additional Amendments

     SEC. 6051. CONTRACTING FUNCTIONS PERFORMED BY FEDERAL 
                   PERSONNEL.

       (a) Amendment of OFPP Act.--The Office of Federal 
     Procurement Policy Act, as amended by section 1092, is 
     further amended by inserting after section 22 the following 
     new section 23:


         ``contracting functions performed by federal personnel

       ``Sec. 23. (a) Limitation on Payment for Advisory and 
     Assistance Services.--(1) No person who is not a person 
     described in subsection (b) may be paid by an agency for 
     services to conduct evaluations or analyses of any aspect of 
     a proposal submitted for an acquisition unless personnel 
     described in subsection (b) with adequate training and 
     capabilities to perform such evaluations and analyses are not 
     readily available within the agency or another Federal 
     agency, as determined in accordance with standards and 
     procedures prescribed in the Federal Acquisition Regulation.
       ``(2) In the administration of this subsection, the head of 
     each agency shall determine in accordance with the standards 
     and procedures set forth in the Federal Acquisition 
     Regulation whether--
       ``(A) a sufficient number of personnel described in 
     subsection (b) within the agency or another Federal agency 
     are readily available to perform a particular evaluation or 
     analysis for the agency head making the determination; and
       ``(B) the readily available personnel have the training and 
     capabilities necessary to perform the evaluation or analysis.
       ``(b) Covered Personnel.--For purposes of subsection (a), 
     the personnel described in this subsection are as follows:
       ``(1) An employee, as defined in section 2105 of title 5, 
     United States Code.
       ``(2) A member of the Armed Forces of the United States.
       ``(3) A person assigned to a Federal agency pursuant to 
     subchapter VI of chapter 33 of title 5, United States Code.
       ``(c) Rule of Construction.--Nothing in this section is 
     intended to affect the relationship between the Federal 
     Government and a federally funded research and development 
     center.''.
       (b) Requirement for Guidance and Regulations.--Not later 
     than 90 days after the date of the enactment of this Act, the 
     Federal Acquisition Regulatory Council established by section 
     25(a) of the Office of Federal Procurement Policy Act (41 
     U.S.C. 421(a)) shall--
       (1) review part 37 of title 48 of the Code of Federal 
     Regulations as it relates to the use of advisory and 
     assistance services; and
       (2) provide guidance and promulgate regulations regarding--
       (A) what actions Federal agencies are required to take to 
     determine whether expertise is readily available within the 
     Federal Government before contracting for advisory and 
     technical services to conduct acquisitions; and
       (B) the manner in which personnel with expertise may be 
     shared with agencies needing expertise for such acquisitions.

     SEC. 6052. REPEAL OF EXECUTED REQUIREMENT FOR STUDY AND 
                   REPORT.

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

     SEC. 6053. INTERESTS OF MEMBERS OF CONGRESS.

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

     SEC. 6054. WAITING PERIOD FOR SIGNIFICANT CHANGES PROPOSED 
                   FOR ACQUISITION REGULATIONS.

       (a) Increased Period.--Section 22(a) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 418b) is amended--
       (1) by striking out ``30 days'' and inserting in lieu 
     thereof ``60 days''; and
       (2) by adding at the end the following: ``Notwithstanding 
     the preceding sentence, such a policy, regulation, procedure, 
     or form may take effect earlier than 60 days after the 
     publication date when there are compelling circumstances for 
     the earlier effective date, but in no event may that 
     effective date be less than 30 days after the publication 
     date.''.
       (b) Technical Amendment.--Section 22(d) of such Act is 
     amended by designating the second sentence as paragraph (3).
                  Subtitle C--Whistleblower Protection

     SEC. 6101. ARMED SERVICES PROCUREMENTS.

       (a) Whistleblower Protections for Contractor Employees.--
     Section 2409 of title 10, United States Code, is amended--
       (1) by striking out subsection (d);
       (2) by redesignating subsection (c) as subsection (d); and
       (3) by inserting after subsection (b) the following new 
     subsection (c):
       ``(c) Remedy and Enforcement Authority.--(1) If the 
     Secretary of Defense determines that a defense contractor has 
     subjected a person to a reprisal prohibited by subsection 
     (a), the Secretary may take one or more of the following 
     actions:
       ``(A) Order the defense contractor to take affirmative 
     action to abate the reprisal.
       ``(B) Order the defense contractor to reinstate the person 
     to the position that the person held before the reprisal, 
     together with the compensation (including back pay), 
     employment benefits, and other terms and conditions of 
     employment that would apply to the person in that position if 
     the reprisal had not been taken.
       ``(C) Order the defense contractor to pay the complainant 
     an amount equal to the aggregate amount of all costs and 
     expenses (including attorney's fees and expert witnesses' 
     fees) that were reasonably incurred by the complainant for, 
     or in connection with, bringing the complaint regarding the 
     reprisal, as determined by the Secretary.
       ``(2) Whenever a person fails to comply with an order 
     issued under paragraph (1), the Secretary shall file an 
     action for enforcement of such order in the United States 
     district court for a district in which the reprisal was found 
     to have occurred. In any action brought under this paragraph, 
     the court may grant appropriate relief, including injunctive 
     relief and compensatory and exemplary damages.
       ``(3) Any person adversely affected or aggrieved by an 
     order issued under paragraph (1) may obtain review of the 
     order's conformance with this subsection, and any regulations 
     issued to carry out this section, in the United States court 
     of appeals for a circuit in which the reprisal is alleged in 
     the order to have occurred. No petition seeking such review 
     may be filed more than 60 days after issuance of the 
     Secretary's order. Review shall conform to chapter 7 of title 
     5.''.
       (b) Related Law.--
       (1) Repeal.--Section 2409a of title 10, United States Code, 
     is repealed.
       (2) Clerical amendment.--The table of sections at the 
     beginning of chapter 141 of such title is amended by striking 
     out the item relating to section 2409a.

     SEC. 6102. GOVERNMENTWIDE WHISTLEBLOWER PROTECTIONS FOR 
                   CONTRACTOR EMPLOYEES.

       The Office of Federal Procurement Policy Act (41 U.S.C. 401 
     et seq.), as amended by section 5091, is further amended by 
     adding at the end the following new section:


  ``contractor employees: protection from reprisal for disclosure of 
                          certain information

       ``Sec. 32. (a) Prohibition of Reprisals.--An employee of an 
     executive agency contractor may not be discharged, demoted, 
     or otherwise discriminated against as a reprisal for 
     disclosing to a Member of Congress or an authorized official 
     of the agency or the Department of Justice information 
     relating to a substantial violation of law related to an 
     agency contract (including the competition for or negotiation 
     of an agency contract).
       ``(b) Investigation of Complaints.--A person who believes 
     that the person has been subjected to a reprisal prohibited 
     by subsection (a) may submit a complaint to the Inspector 
     General of the executive agency. Unless the Inspector General 
     determines that the complaint is frivolous, the Inspector 
     General shall investigate the complaint and, upon completion 
     of such investigation, submit a report of the findings of the 
     investigation to the person, the contractor concerned, and 
     the head of the agency. In the case of an executive agency 
     that does not have an inspector general, the duties of the 
     inspector general under this section shall be performed by an 
     official designated by the agency head.
       ``(c) Remedy and Enforcement Authority.--(1) If the head of 
     an executive agency determines that an agency contractor has 
     subjected a person to a reprisal prohibited by subsection 
     (a), the agency head may take one or more of the following 
     actions:
       ``(A) Order the contractor to take affirmative action to 
     abate the reprisal.
       ``(B) Order the contractor to reinstate the person to the 
     position that the person held before the reprisal, together 
     with the compensation (including back pay), employment 
     benefits, and other terms and conditions of employment that 
     would apply to the person in that position if the reprisal 
     had not been taken.
       ``(C) Order the contractor to pay the complainant an amount 
     equal to the aggregate amount of all costs and expenses 
     (including attorney's fees and expert witnesses' fees) that 
     were reasonably incurred by the complainant for, or in 
     connection with, bringing the complaint regarding the 
     reprisal, as determined by the Secretary.
       ``(2) Whenever a person fails to comply with an order 
     issued under paragraph (1), the agency head shall file an 
     action for enforcement of such order in the United States 
     district court for a district in which the reprisal was found 
     to have occurred. In any action brought under this paragraph, 
     the court may grant appropriate relief, including injunctive 
     relief and compensatory and exemplary damages.
       ``(3) Any person adversely affected or aggrieved by an 
     order issued under paragraph (1) may obtain review of the 
     order's conformance with this subsection, and any regulations 
     issued to carry out this section, in the United States court 
     of appeals for a circuit in which the reprisal is alleged in 
     the order to have occurred. No petition seeking such review 
     may be filed more than 60 days after issuance of the agency 
     head's order. Review shall conform to chapter 7 of title 5, 
     United States Code.
       ``(d) Construction.--Nothing in this section may be 
     construed to authorize the discharge of, demotion of, or 
     discrimination against an employee for a disclosure other 
     than a disclosure protected by subsection (a) or to modify or 
     derogate from a right or remedy otherwise available to the 
     employee.
       ``(e) Coordination With Other Law.--This section does not 
     apply with respect to the Department of Defense. For the 
     corresponding provision of law applicable to the Department 
     of Defense, see section 2409 of title 10, United States Code.
       ``(f) Definition.--In this section, the term `Inspector 
     General' means an Inspector General appointed under the 
     Inspector General Act of 1978.''.
                TITLE VII--DEFENSE TRADE AND COOPERATION

     SEC. 7001. PURCHASES OF FOREIGN GOODS.

       (a) Repeal of Executed Requirements.--
       (1) Requirement for policy guidance.--Title III of the Act 
     of March 3, 1933 (41 U.S.C. 10a et seq.), commonly referred 
     to as the ``Buy American Act'', is amended in section 4(g) 
     (41 U.S.C. 10b-1(g)) by striking out paragraphs (2)(C) and 
     (3).
       (2) Reporting requirement.--Section 9096(b) of Public Law 
     102-396 (106 Stat. 1924; 41 U.S.C. 10b-2(b)) is repealed.
       (b) Repeal of Redundant Provision.--
       (1) Consideration of national security objectives.--Section 
     2327 of title 10, United States Code, is repealed.
       (2) Clerical amendment.--The table of sections at the 
     beginning of chapter 137 of such title is amended by striking 
     out the item relating to section 2327.

     SEC. 7002. INTERNATIONAL COOPERATIVE AGREEMENTS.

       (a) Terminology Revisions.--Section 2531 of title 10, 
     United States Code, is amended--
       (1) in the subsection captions for subsections (a) and (c), 
     by striking out ``MOUs and Related'' and inserting in lieu 
     thereof ``International'';
       (2) in subsection (a), by striking out ``proposed 
     memorandum of understanding, or any existing or proposed 
     agreement related to a memorandum of understanding,'' in the 
     matter above paragraph (1) and inserting in lieu thereof 
     ``proposed international agreement, including a memorandum of 
     understanding,'';
       (3) by striking out ``memorandum of understanding or 
     related agreement'' each place it appears and inserting in 
     lieu thereof ``international agreement'';
       (4) in subsection (b), by striking out ``memorandum or 
     related agreement'' each place it appears in the second 
     sentence and inserting in lieu thereof ``international 
     agreement''; and
       (5) in subsection (c)--
       (A) by striking out ``A'' after ``Agreements.--'' and 
     inserting in lieu thereof ``An''; and
       (B) by striking out ``memorandum or agreement'' and 
     inserting in lieu thereof ``international agreement''.
       (b) Expanded Scope of Agreements.--Section 2531(a) of title 
     10, United States Code, is amended by striking out 
     ``research, development, or production'' in the matter above 
     paragraph (1) and inserting in lieu thereof ``research, 
     development, production, or logistics support''.
       (c) Clerical Amendments.--
       (1) Section heading.--The heading of section 2531 of title 
     10, United States Code, is amended to read as follows:

     ``Sec. 2531. Defense international agreements''.

       (2) Table of sections.--The item relating to such section 
     in the table of sections at the beginning of subchapter V of 
     chapter 148 of such title is amended to read as follows:

``2531. Defense international agreements.''.

     SEC. 7003. ACQUISITION, CROSS-SERVICING AGREEMENTS, AND 
                   STANDARDIZATION.

       (a) Limited Waiver of Restrictions on Accrued Reimbursable 
     Liabilities and Credits for Contingency Operations.--Section 
     2347 of title 10, United States Code, is amended by adding at 
     the end the following new subsection:
       ``(c) The Secretary of Defense may waive the restrictions 
     in subsections (a) and (b) for a period not to exceed 180 
     days upon a written determination that the armed forces are 
     involved in a contingency operation or that involvement of 
     the armed forces in a contingency operation is imminent. Upon 
     making such a determination, the Secretary shall transmit a 
     copy of the determination to the Committees on Armed Services 
     of the Senate and House of Representatives.''.
       (b) Communications Support.--Section 2350f 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)(1) Nothing in this section shall be construed to 
     limit the authority of the Secretary of Defense, without a 
     formal bilateral agreement or multilateral arrangement, to 
     furnish communications support and related supplies to, or 
     receive communications support and related supplies from, an 
     allied country in accordance with this subsection.
       ``(2) The Secretary of Defense may furnish or receive such 
     support and supplies on a reciprocal basis for a period not 
     to exceed 90 days--
       ``(A) in order to meet emerging operational requirements of 
     the United States and the allied country; or
       ``(B) incident to a joint military exercise with the allied 
     country.
       ``(3) If interconnection of communication circuits is 
     maintained for joint or multilateral defense purposes under 
     the authority of this subsection, the costs of maintaining 
     such circuits may be allocated among the various users.''.
                      TITLE VIII--COMMERCIAL ITEMS

     SEC. 8001. DEFINITIONS.

       Section 4 of the Office of Federal Procurement Policy Act 
     (41 U.S.C. 403), as amended by section 4001(a), is further 
     amended--
       (1) by striking out ``Act--''and inserting in lieu thereof 
     ``Act:'';
       (2) by capitalizing the initial letter in the first word of 
     each paragraph;
       (3) by striking out the semicolon at the end of each of 
     paragraphs (1), (2), (3), (5), (6), (7), (8), and (9) and 
     inserting in lieu thereof a period;
       (4) in paragraphs (4) and (10), by striking out ``; and'' 
     at the end and inserting in lieu thereof a period; and
       (5) by adding at the end the following new paragraphs:
       ``(12) The term `commercial item' means--
       ``(A) property, other than real property, that is of a type 
     customarily used by the general public or by nongovernmental 
     entities in the course of normal business operations for 
     purposes other than governmental purposes and--
       ``(i) has been sold, leased, or licensed to the general 
     public;
       ``(ii) has not been sold, leased, or licensed to the 
     general public but has been offered for sale, lease, or 
     license to the general public; or
       ``(iii) is not yet available in the commercial marketplace 
     but will be made available for commercial delivery within a 
     reasonable period;
       ``(B) any item that, but for--
       ``(i) modifications of a type customarily available in the 
     commercial marketplace, or
       ``(ii) minor modifications made to meet Federal Government 
     requirements,

     would satisfy the criteria in subparagraph (A);
       ``(C) any combination of items meeting the requirements of 
     subparagraph (A), (B), or (D) that are of a type customarily 
     combined and sold in combination to the general public;
       ``(D) installation services, maintenance services, repair 
     services, training services, and other services if such 
     services are procured for support of an item referred to in 
     subparagraph (A), (B), or (C) and if the source of such 
     services--
       ``(i) offers such services to the general public and the 
     Federal Government contemporaneously and under similar terms 
     and conditions; and
       ``(ii) offers to use the same work force for providing the 
     Federal Government with such services as the source uses for 
     providing such services to the general public; and
       ``(E) any item, combination of items, or service referred 
     to in subparagraph (A), (B), (C), or (D), regardless of 
     whether the item, combination of items, or service is 
     transferred between or among separate divisions, 
     subsidiaries, or affiliates of a contractor.
       ``(13) The term `nondevelopmental item' means--
       ``(A) any commercial item;
       ``(B) any previously developed item of supply that is in 
     use by a department or agency of the United States, a State 
     or local government, or a foreign government with which the 
     United States has a mutual defense cooperation agreement;
       ``(C) any item of supply described in subparagraph (A) or 
     (B) that requires only minor modification of the type 
     normally available in the commercial marketplace in order to 
     meet the requirements of the procuring department or agency; 
     or
       ``(D) any item of supply currently being produced that does 
     not meet the requirements of subparagraph (A), (B), or (C) 
     solely because the item--
       ``(i) is not yet in use; or
       ``(ii) is not yet available in the commercial marketplace.
       ``(14) The term `component' means any item supplied to the 
     Federal Government as part of an end item or of another 
     component.
       ``(15) The term `commercial component' means any component 
     that is a commercial item.''.

     SEC. 8002. PREFERENCE FOR ACQUISITION OF COMMERCIAL ITEMS AND 
                   NONDEVELOPMENTAL ITEMS.

       (a) Preference Required.--The Office of Federal Procurement 
     Policy Act (41 U.S.C. 401 et seq.), as amended by section 
     6102, is further amended by adding at the end the following 
     new section:


 ``preference for acquisition of commercial items and nondevelopmental 
                                 items

       ``Sec. 33. (a) Preference.--The head of each executive 
     agency shall ensure that, to the maximum extent practicable--
       ``(1) requirements of the executive agency with respect to 
     a procurement of supplies are stated in terms of--
       ``(A) functions to be performed;
       ``(B) performance required; or
       ``(C) essential physical characteristics;
       ``(2) such requirements are defined so that commercial 
     items or, to the extent that commercial items suitable to 
     meet the agency's needs are not available, other 
     nondevelopmental items may be procured to fulfill such 
     requirements; and
       ``(3) offerors of commercial items and other 
     nondevelopmental items are provided an opportunity to compete 
     in any procurement to fill such requirements.
       ``(b) Implementation.--The head of each executive agency 
     shall ensure that procurement officials in that executive 
     agency, to the maximum extent practicable--
       ``(1) acquire commercial items or other nondevelopmental 
     items to meet the needs of the executive agency;
       ``(2) require prime contractors and subcontractors at all 
     levels under the executive agency contracts to incorporate 
     commercial items or other nondevelopmental items as 
     components of items supplied to the executive agency;
       ``(3) modify requirements in appropriate cases to ensure 
     that the requirements can be met by commercial items or, to 
     the extent that commercial items suitable to meet the 
     agency's needs are not available, other nondevelopmental 
     items;
       ``(4) state specifications in terms that enable and 
     encourage bidders and offerors to supply commercial items or, 
     to the extent that commercial items suitable to meet the 
     agency's needs are not available, other nondevelopmental 
     items in response to the executive agency solicitations;
       ``(5) revise the executive agency's procurement policies, 
     practices, and procedures not required by law to reduce any 
     impediments in those policies, practices, and procedures to 
     the acquisition of commercial items; and
       ``(6) require training of appropriate personnel in the 
     acquisition of commercial items.
       ``(c) Preliminary Market Research.--(1) The head of an 
     executive agency shall conduct market research appropriate to 
     the circumstances--
       ``(A) before developing new specifications for a 
     procurement by that executive agency; and
       ``(B) before soliciting bids or proposals for a contract in 
     excess of the simplified acquisition threshold.
       ``(2) The head of an executive agency shall use the results 
     of market research to determine whether there are commercial 
     items or, to the extent that commercial items suitable to 
     meet the agency's needs are not available, other 
     nondevelopmental items available that--
       ``(A) meet the executive agency's requirements;
       ``(B) could be modified to meet the executive agency's 
     requirements; or
       ``(C) could meet the executive agency's requirements if 
     those requirements were modified to a reasonable extent.
       ``(3) In conducting market research, the head of an 
     executive agency should not require potential sources to 
     submit more than the minimum information that is necessary to 
     make the determinations required in paragraph (2).''.
       (b) Repeal of Superseded Provision.--
       (1) Separate statement of preference for department of 
     defense.--Section 2325 of title 10, United States Code, is 
     repealed.
       (2) Clerical amendment.--The table of sections at the 
     beginning of chapter 137 of such title is amended by striking 
     out the item relating to section 2325.

     SEC. 8003. ACQUISITION OF COMMERCIAL ITEMS.

       (a) Required FAR Provisions.--The Office of Federal 
     Procurement Policy Act (41 U.S.C. 401 et seq.), as amended by 
     section 8002, is further amended by adding at the end the 
     following:


 ``federal acquisition regulation provisions regarding acquisitions of 
                    commercial items and components

       ``Sec. 34. (a) Contract Clauses and Other Clauses.--(1)(A) 
     The Federal Acquisition Regulation shall include one or more 
     sets of contract clauses containing the required terms and 
     conditions for the acquisition of commercial items and 
     commercial components by executive agencies and by 
     contractors in the performance of contracts of executive 
     agencies.
       ``(B) The contract clauses referred to in subparagraph (A) 
     shall include only--
       ``(i) those clauses that are required to implement 
     provisions of law or executive orders applicable to 
     acquisitions of commercial items or commercial components, as 
     the case may be;
       ``(ii) those contract clauses that are essential for the 
     protection of the Federal Government's interest in an 
     acquisition of commercial items or commercial components, as 
     the case may be; and
       ``(iii) those contract clauses that are determined to be 
     consistent with standard commercial practice.
       ``(2) Subject to paragraph (3), the Federal Acquisition 
     Regulation shall require that, to the maximum extent 
     practicable, only the contract clauses referred to in 
     paragraph (1) be used in a contract, or be required to be 
     used in a subcontract, for the acquisition of commercial 
     items or commercial components by or for an executive agency.
       ``(3) The Federal Acquisition Regulation shall provide that 
     a contract or subcontract referred to in paragraph (2) may 
     contain contract clauses other than the contract clauses 
     referred to in that paragraph only if the other clauses are 
     essential for the protection of the Federal Government's 
     interest in--
       ``(A) that contract or subcontract, as determined in 
     writing by the contracting officer for such contract; or
       ``(B) a class of contracts or subcontracts, as determined 
     by the head of an agency concerned, unless the determination 
     of that head of an agency is disapproved by the 
     Administrator.
       ``(4) The Federal Acquisition Regulation shall provide 
     standards and procedures for waiving the use of contract 
     clauses required pursuant to paragraph (1), other than those 
     required by law, including standards for determining the 
     cases in which a waiver is appropriate.
       ``(b) Market Acceptance.--(1) The Federal Acquisition 
     Regulation shall provide that under appropriate conditions 
     the head of an executive agency may require offerors to 
     demonstrate that the items offered--
       ``(A) have either--
       ``(i) achieved commercial market acceptance; or
       ``(ii) been satisfactorily supplied to an executive agency 
     under current or recent contracts for the same or similar 
     requirements; and
       ``(B) otherwise meet the item description, specifications, 
     or other criteria prescribed in the public notice and 
     solicitation relating to the contract.
       ``(2) The Federal Acquisition Regulation shall provide 
     guidance to ensure that the criteria for determining 
     commercial market acceptance include the consideration of--
       ``(A) the minimum needs of the executive agency concerned; 
     and
       ``(B) the entire relevant commercial market, including 
     small businesses.
       ``(c) Use of Firm, Fixed Price Contracts.--The Federal 
     Acquisition Regulation shall include a requirement that firm, 
     fixed price contracts or fixed price with economic price 
     adjustment contracts, be used, to the maximum extent 
     practicable, for the acquisition of commercial items.
       ``(d) Contract Quality Requirements.--The Federal 
     Acquisition Regulation shall include provisions that--
       ``(1) permit, to the maximum extent practicable, a 
     contractor under a commercial items acquisition to use the 
     contractor's existing quality assurance system as a 
     substitute for compliance with a requirement for the Federal 
     Government to inspect or test the commercial items before the 
     contractor's tender of those items for acceptance by the 
     Federal Government;
       ``(2) require that, to the maximum extent practicable, an 
     executive agency accept commercial warranties (including 
     extended warranties) offered by offerors of commercial items 
     to commercial customers and use such warranties for the 
     repair and replacement of commercial items; and
       ``(3) set forth guidance to executive agencies regarding 
     the use of past performance of items and sources as a factor 
     in contract award decisions.
       ``(e) Treatment of Transfers Between Affiliates.--The 
     Federal Acquisition Regulation shall provide for a transfer 
     of commercial items from one division, subsidiary, or 
     affiliate of a contractor to another division, subsidiary, or 
     affiliate of the contractor to be treated as a subcontract 
     for purposes of section 35 of the Office of Federal 
     Procurement Policy Act and the provisions of law amended by 
     section 8005 of the Federal Acquisition Streamlining Act of 
     1994.''.
       (b) Defense Contract Clauses.--
       (1)  Termination of dod authority.--Section 824(b) of the 
     National Defense Authorization Act for Fiscal Years 1990 and 
     1991 (Public Law 101-189; 10 U.S.C. 2325 note) shall cease to 
     be effective on the date on which the regulations 
     implementing section 34 of the Office of Federal Procurement 
     Policy Act, as added by subsection (a), become effective.
       (2) Savings provision.--Notwithstanding section 34(a) of 
     the Office of Federal Procurement Policy Act (as added by 
     subsection (a)), contracts of the Department of Defense 
     entered into before the date on which section 824(b) ceases 
     to be effective under paragraph (1), and subcontracts entered 
     into before such date under such contracts, may include 
     clauses developed pursuant to paragraphs (2) and (3) of 
     section 824(b) of the National Defense Authorization Act for 
     Fiscal Years 1990 and 1991 (Public Law 101-189; 10 U.S.C. 
     2325 note).

     SEC. 8004. CLASS WAIVER OF APPLICABILITY OF CERTAIN LAWS.

       The Office of Federal Procurement Policy Act (41 U.S.C. 401 
     et seq.), as amended by section 8003, is further amended by 
     adding at the end the following:


  ``class waiver of applicability of certain laws to acquisitions of 
                            commercial items

       ``Sec. 35. (a) In General.--The applicability of a 
     provision of law described in subsection (c) that is enacted 
     after the date of the enactment of the Federal Acquisition 
     Streamlining Act of 1994 to contracts for the acquisition of 
     commercial items may be waived on a class basis in the 
     Federal Acquisition Regulation. Such a waiver shall not apply 
     to a provision of law that expressly refers to this section 
     and prohibits the waiver of that provision of law.
       ``(b) Waiver of Applicability to Subcontracts.--(1) The 
     applicability of a provision of law described in subsection 
     (c) to subcontracts under a contract for the acquisition of 
     commercial items or a subcontract for the acquisition of 
     commercial components may be waived on a class basis in the 
     Federal Acquisition Regulation. Such a waiver shall not apply 
     to a provision of law that expressly refers to this section 
     and prohibits the waiver of that provision of law.
       ``(2) Nothing in this subsection shall be construed to 
     authorize the waiver of the applicability of any provision of 
     law with respect to--
       ``(A) any contract with a prime contractor; or
       ``(B) any subcontract under a contract with a prime 
     contractor who does not substantially transform the 
     commercial items supplied under the contract.
       ``(c) Covered Law.--A provision of law referred to in 
     subsections (a) and (b) is any provision of law that, as 
     determined by the Federal Acquisition Regulatory Council, 
     sets forth policies, procedures, requirements, or 
     restrictions for the procurement of property or services by 
     the Federal Government.''.

     SEC. 8005. INAPPLICABILITY OF CERTAIN PROVISIONS OF LAW.

       (a) Armed Services Acquisitions.--
       (1) Prohibition on contingent fees.--Section 2306(b) of 
     title 10, United States Code, as amended by section 4022(a), 
     is further amended by inserting before the period at the end 
     of the sentence added by section 4022(a) the following: ``or 
     to a contract for the acquisition of commercial items''.
       (2) Requirement to identify suppliers and sources of 
     supplies.--Paragraph (2) of section 2384(b) of title 10, 
     United States Code, is amended to read as follows:
       ``(2) The regulations prescribed pursuant to paragraph (1) 
     do not apply to a contract that requires the delivery of 
     supplies that are commercial items, as defined in section 
     2302 of this title.''.
       (3) Prohibition against doing business with certain 
     offerors or contractors.--Section 2393(d) of title 10, United 
     States Code, as amended by section 4022(e), is further 
     amended by adding at the end the following: ``The requirement 
     shall not apply in the case of a subcontract for the 
     acquisition of commercial items (as defined in section 4(12) 
     of the Office of Federal Procurement Policy Act (41 U.S.C. 
     403(12))).''.
       (4) Prohibition on limitation of subcontractor direct 
     sales.--Section 2402 of title 10, United States Code, as 
     amended by section 4022(b), is further amended by adding at 
     the end the following new subsection:
       ``(d)(1) An agreement between the contractor in a contract 
     for the acquisition of commercial items and a subcontractor 
     under such contract that restricts sales by such 
     subcontractor directly to persons other than the contractor 
     may not be considered to unreasonably restrict sales by that 
     subcontractor to the United States in violation of the 
     provision included in such contract pursuant to subsection 
     (a) if the agreement does not result in the Federal 
     Government being treated differently with regard to the 
     restriction than any other prospective purchaser of such 
     commercial items from that subcontractor.
       ``(2) In paragraph (1), the term `commercial item' has the 
     meaning given such term in section 4(12) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403(12)).''.
       (5) Contractor inventory accounting systems: standards.--
     Section 2410b of title 10, United States Code, is amended--
       (A) by inserting ``(a) Regulations Required.--'' before 
     ``The Secretary of Defense''; and
       (B) by adding at the end the following new subsection:
       ``(b) Inapplicability to Acquisitions of Commercial 
     Items.--The regulations prescribed pursuant to subsection (a) 
     need not apply to a contract for the acquisition of 
     commercial items (as defined in section 4(12) of the Office 
     of Federal Procurement Policy Act (41 U.S.C. 403(12))).''.
       (6) Prohibition on persons convicted of defense-contract 
     related felonies.--Paragraph (4) of section 2408(a) of title 
     10, United States Code, as added by section 4022(f), is 
     amended--
       (A) by inserting after subparagraph (A) the following:
       ``(B) A contract referred to in such subparagraph that is 
     for the acquisition 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) by inserting ``or (B)'' before the period at the end of 
     subparagraph (C).
       (b) Civilian Agency Acquisitions.--
       (1) Restrictions on subcontractor sales to the united 
     states.--Section 303G of the Federal Property and 
     Administrative Services Act of 1949 (41 U.S.C. 253g), as 
     amended by section 4023(b), is further amended by adding at 
     the end the following new subsection:
       ``(d) An agreement between the contractor in a contract for 
     the acquisition of commercial items and a subcontractor under 
     such contract that restricts sales by such subcontractor 
     directly to persons other than the contractor may not be 
     considered to unreasonably restrict sales by that 
     subcontractor to the United States in violation of the 
     provision included in such contract pursuant to subsection 
     (a) if the agreement does not result in the Federal 
     Government being treated differently with regard to the 
     restriction than any other prospective purchaser of such 
     commercial items from that subcontractor.''.
       (2) Prohibition on contingent fees.--Section 304(a) of the 
     Federal Property and Administrative Services Act of 1949 (41 
     U.S.C. 254(a)), as amended by section 4023(a), is further 
     amended by inserting before the period at the end of the 
     sentence added by section 4023(a) the following: ``or to a 
     contract for the acquisition of commercial items''.
       (c) Acquisitions Generally.--
       (1) Federal water pollution control act.--Section 508 of 
     the Federal Water Pollution Control Act (33 U.S.C. 1368) is 
     amended by adding at the end the following new subsection:
       ``(f)(1) No certification by a contractor, and no contract 
     clause, may be required in the case of a contract for the 
     acquisition of commercial items in order to implement a 
     prohibition or requirement of this section or a prohibition 
     or requirement issued in the implementation of this section.
       ``(2) In paragraph (1), the term `commercial item' has the 
     meaning given such term in section 4(12) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403(12)).''.
       (2) Contract work hours and safety standards act.--The 
     Contract Work Hours and Safety Standards Act (title I of the 
     Work Hours and Safety Act of 1962 (40 U.S.C. 327 et seq.)) is 
     amended by adding at the end the following new section:
       ``Sec. 108. (a) No certification by a contractor, and no 
     contract clause, may be required in the case of a contract 
     for the acquisition of commercial items in order to implement 
     a prohibition or requirement in this title.
       ``(b) In subsection (a), the term `commercial item' has the 
     meaning given such term in section 4(12) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403(12)).''.
       (3) Office of federal procurement policy act requirement 
     relating to procurement integrity certifications.--Section 
     27(e)(7) of the Office of Federal Procurement Policy Act (41 
     U.S.C. 423) is amended by adding at the end the following new 
     subparagraph:
       ``(C) This subsection does not apply to a contract for the 
     acquisition of commercial items.''.
       (4) Certain provisions of the anti-kickback act of 1986.--
       (A) Requirement for contract clause.--Section 7 of the 
     Anti-Kickback Act of 1986 (41 U.S.C. 57), as amended by 
     section 4024(b), is further amended by inserting before the 
     period at the end of subsection (d) the following: ``or to a 
     prime contract for the acquisition of commercial items (as 
     defined in section 4(12) of such Act (41 U.S.C. 403(12))).''.
       (B) Inspection authority.--Section 8 of such Act (41 U.S.C. 
     58) is amended by adding at the end the following: ``This 
     section does not apply with respect to a prime contract for 
     the acquisition of commercial items (as defined in section 
     4(12) of the Office of Federal Procurement Policy Act (41 
     U.S.C. 403(12))).''.
       (5) Drug-free workplace act of 1988.--Section 5152(a)(1) of 
     the Drug-Free Workplace Act of 1988 (subtitle D of title V of 
     Public Law 100-690; 41 U.S.C. 701(a)(1)), as amended by 
     section 4024(e), is further amended by inserting after the 
     matter inserted by such section 4024(e) the following: ``, 
     other than a contract for the procurement of commercial items 
     (as defined in section 4(12) of such Act (41 U.S.C. 
     403(12))),''.
       (6) Clean air act.--Section 306 of the Clean Air Act (42 
     U.S.C. 7606) is amended by adding at the end the following 
     new subsection:
       ``(f)(1) No certification by a contractor, and no contract 
     clause, may be required in the case of a contract for the 
     acquisition of commercial items in order to implement a 
     prohibition or requirement of this section or a prohibition 
     or requirement issued in the implementation of this section.
       ``(2) In paragraph (1), the term `commercial item' has the 
     meaning given such term in section 4(12) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403(12)).''.
       (7) Fly american requirements.--Section 1117 of the Federal 
     Aviation Act of 1958 (49 U.S.C. App. 1517) is amended by 
     adding at the end the following new subsection:
       ``(e)(1) No certification by a contractor, and no contract 
     clause, may be required in the case of a contract for the 
     transportation of commercial items in order to implement a 
     requirement in this section.
       ``(2) In paragraph (1), the term `commercial item' has the 
     meaning given such term in section 4(12) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 403(12)).''.

     SEC. 8006. FLEXIBLE DEADLINES FOR SUBMISSION OF OFFERS OF 
                   COMMERCIAL ITEMS.

       (a) Office of Federal Procurement Policy Act Amendment.--
     Section 18(a) of the Office of Federal Procurement Policy Act 
     (41 U.S.C. 416(a)) is amended by adding at the end the 
     following new paragraph:
       ``(4) The requirements of paragraph (3)(B) do not apply to 
     contracts for the purchase of commercial items. The 
     Administrator shall prescribe for such contracts appropriate 
     limits on the applicability of a deadline for submission of 
     bids or proposals that is required by paragraph (1). Such 
     limits shall be incorporated in the Federal Acquisition 
     Regulation. The Federal Acquisition Regulation shall specify 
     a minimum period for submission of a response to a 
     solicitation of offers for a contract for the acquisition of 
     commercial items.''.
       (b) Savings Provision.--The deadlines for submission of 
     offers that are in effect in accordance with section 18(a) of 
     the Office of Federal Procurement Policy Act (41 U.S.C. 
     416(a)) and section 8(e) of the Small Business Act (15 U.S.C. 
     637(e)) shall continue to apply to contracts for the purchase 
     of commercial items until the limits prescribed pursuant to 
     paragraph (4) of section 18(a) of the Office of Federal 
     Procurement Policy Act (as added by subsection (a)) are 
     incorporated in the Federal Acquisition Regulation, as 
     required by such paragraph.

     SEC. 8007. ADVOCATES FOR ACQUISITION OF COMMERCIAL AND 
                   NONDEVELOP- MENTAL ITEMS.

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

     SEC. 8008. PROVISIONS NOT AFFECTED.

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

     SEC. 8009. COMPTROLLER GENERAL REVIEW OF FEDERAL GOVERNMENT 
                   USE OF MARKET RESEARCH.

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

     SEC. 9001. COMPTROLLER GENERAL REVIEW OF THE PROVISION OF 
                   LEGAL ADVICE FOR INSPECTORS GENERAL.

       (a) Review and Report Required.--Not later than March 1, 
     1995, the Comptroller General of the United States shall--
       (1) conduct a review of the independence of the legal 
     services being provided to Inspectors General appointed under 
     the Inspector General Act of 1978; and
       (2) submit to Congress a report on the results of the 
     review.
       (b) Matters Required for Report.--The report shall include 
     the following matters:
       (1) With respect to each department or agency of the 
     Federal Government that has an Inspector General appointed in 
     accordance with the Inspector General Act of 1978 whose only 
     or principal source of legal advice is the general counsel or 
     other chief legal officer of the department or agency, an 
     assessment of the extent of the independence of the legal 
     advisors providing advice to the Inspector General.
       (2) A comparison of the findings under the assessment 
     referred to in paragraph (1) with findings on the same 
     matters with respect to each Inspector General whose source 
     of legal advice is legal counsel accountable solely to the 
     Inspector General.

     SEC. 9002. COST SAVINGS FOR OFFICIAL TRAVEL.

       (a) The Administrator of the General Services 
     Administration, no later than 120 days after enactment of 
     this section, shall issue guidelines to ensure that agencies 
     promote, encourage and facilitate the use of frequent 
     traveler programs offered by airlines, hotels and car rental 
     vendors by Federal employees who engage in official air 
     travel, for the purpose of realizing to the maximum extent 
     practicable cost savings for official travel.
       (b) Any awards granted under such a frequent traveler 
     program accrued through official travel shall be used only 
     for official travel.
       (c) Within one year of enactment of this section, the 
     Administrator shall report to the Congress on efforts to 
     promote the use of frequent traveler programs by Federal 
     employees.

     SEC. 9003. PROMPT RESOLUTION OF AUDIT RECOMMENDATIONS.

       Federal agencies shall resolve or take corrective action on 
     all Office of Inspector General audit report findings within 
     a maximum of six months after their issuance, or, in the case 
     of audits performed by non-Federal auditors, six months after 
     receipt of the report by the Federal Government.

     SEC. 9004. UNIFORM SUSPENSION AND DEBARMENT.

       (a) Within six months after the date of enactment of this 
     Act, regulations shall be issued providing that provisions 
     for the debarment, suspension, or other exclusion of a 
     participant in a procurement activity under the Federal 
     Acquisition Regulation, or in a nonprocurement activity under 
     regulations issued pursuant to Executive Order No. 12549, 
     shall have government-wide effect. No agency shall allow a 
     party to participate in any procurement or nonprocurement 
     activity if any agency has debarred, suspended, or otherwise 
     excluded (to the extent specified in the exclusion agreement) 
     that party from participation in a procurement or 
     nonprocurement activity.
       (b) The Regulations issued pursuant to subsection (a) shall 
     provide that an agency may grant an exception permitting a 
     debarred, suspended, or otherwise excluded party to 
     participate in procurement activities of that agency to the 
     extent exceptions are authorized under the Federal 
     Acquisition Regulation, or to participate in nonprocurement 
     activities of that agency to the extent exceptions are 
     authorized under regulations issued pursuant to Executive 
     Order No. 12549.
       (c) Definitions.--For the purposes of this part--
       (1) ``Procurement activities'' refers to all acquisition 
     programs and activities of the Federal Government, as defined 
     in the Federal Acquisition Regulation.
       (2) ``Nonprocurement activities'' refers to all programs 
     and activities involving Federal financial and nonfinancial 
     assistance and benefits, as covered by Executive Order No. 
     12549 and the Office of Management and Budget guidelines 
     implementing that order.
       (3) ``Agency'' refers to executive departments and 
     agencies.
              TITLE X--EFFECTIVE DATES AND IMPLEMENTATION

     SEC. 10001. EFFECTIVE DATES.

       (a) Effective Date of Act.--Except as otherwise provided in 
     this Act, this Act shall take effect on the date of the 
     enactment of this Act.
       (b) Effective Date of Amendments.--Except as otherwise 
     provided in this Act, the amendments made by this Act shall 
     take effect on the date on which final implementing 
     regulations are prescribed in accordance with section 10002.

     SEC. 10002. IMPLEMENTING REGULATIONS.

       (a) Proposed Changes.--Proposed changes to the Federal 
     Acquisition Regulation and such other proposed regulations 
     (or changes to existing regulations) as may be necessary to 
     implement this Act shall be published in the Federal Register 
     not later than 210 days after the date of the enactment of 
     this Act.
       (b) Public Comment.--The proposed regulations described in 
     subsection (a) shall be made available for public comment for 
     a period of not less than 60 days.
       (c) Final Regulations.--Final regulations shall be 
     published in the Federal Register not later than 330 days 
     after the date of enactment of this Act.
       (d) Applicability.--(1) The amendments made by this Act 
     shall apply, in the manner prescribed in such final 
     regulations, to any solicitation that is issued or any 
     unsolicited proposal that is received on or after the date 
     described in paragraph (3).
       (2) The amendments made by this Act shall apply, to the 
     extent and in the manner prescribed in such final 
     regulations, to any matter related to--
       (A) a contract that is in effect on the date described in 
     paragraph (3);
       (B) an offer under consideration on the date described in 
     paragraph (3); or
       (C) any other proceeding or action that is ongoing on the 
     date described in paragraph (3).
       (3) The date referred to in paragraphs (1) and (2) is the 
     date specified in such regulations, which--
       (A) shall not be earlier than the end of the 30-day period 
     that begins on the date the regulations required by 
     subsection (c) are published; and
       (B) shall not be later than October 1, 1995.
       (e) Requirement for Clarity.--Officers and employees of the 
     Federal Government who prescribe regulations to implement 
     this Act and the amendments made by this Act shall make every 
     effort practicable to ensure that the regulations are concise 
     and are easily understandable by potential offerors as well 
     as by Government officials.
       (f) Savings Provision.--Nothing in this Act shall be 
     construed to affect the validity of any action taken or any 
     contract entered into prior to the date specified in the 
     regulations pursuant to subsection (d)(3) except to the 
     extent and in the manner prescribed in such regulations.

     SEC. 10003. EVALUATION BY THE COMPTROLLER GENERAL.

       (a) Evaluation Relating to Issuance of Regulations.--Not 
     later than December 1, 1995, the Comptroller General shall 
     submit to the committees referred to in subsection (c) a 
     report evaluating compliance with the requirements in section 
     10002, relating to the issuance of implementing regulations.
       (b) Evaluation of Implementation of Regulations.--Not later 
     than December 1, 1996, the Comptroller General shall submit 
     to the committees referred to in subsection (c) a report 
     evaluating the effectiveness of the regulations implementing 
     this Act in streamlining the acquisition system and 
     fulfilling the other purposes of this Act. The report shall 
     include the Comptroller General's evaluation of the extent to 
     which the departments and agencies of the Federal Government, 
     in implementing this Act and the amendments made by this Act, 
     are reducing acquisition management layers and associated 
     costs.
       (c) Committees Designated To Receive the Reports.--The 
     Comptroller General shall submit the reports required by this 
     section to the Committees on Armed Services and on 
     Governmental Affairs of the Senate and the Committees on 
     Small Business on Government Operations of the House of 
     Representatives.

     SEC. 10004. DATA COLLECTION THROUGH THE FEDERAL PROCUREMENT 
                   DATA SYSTEM.

       (a) Data Collection Required.--The Federal Procurement Data 
     System described in section 6(d)(4)(A) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 405(d)(4)(A)) shall 
     be modified to collect from contracts in excess of the 
     simplified acquisition threshold data pertaining to the 
     following matters:
       (1) Contract awards made pursuant to competitions conducted 
     pursuant to section 2323 of title 10, United States Code, or 
     section 8(c) of the Small Business Act (15 U.S.C. 637(c)).
       (2) Awards to business concerns owned and controlled by 
     women.
       (3) Number of offers received in response to a 
     solicitation.
       (4) Task order contracts.
       (5) Contracts for the acquisition of commercial items.
       (b) Definition.--In this section, the term ``simplified 
     acquisition threshold'' has the meaning given such term in 
     section 4 of the Office of Federal Procurement Policy Act (41 
     U.S.C. 403).
  TITLE XI--WAIVER OF THE APPLICATION OF THE PREVAILING WAGE-SETTING 
                       REQUIREMENTS TO VOLUNTEERS

     SEC. 11001. SHORT TITLE.

       This title may be cited as the ``Community Improvement 
     Volunteer Act of 1994''.

     SEC. 11002. PURPOSE.

       It is the purpose of this title to promote and provide more 
     opportunities for people who wish to volunteer their services 
     in the construction, repair or alteration (including painting 
     and decorating) of public buildings and public works funded, 
     in whole or in part, with Federal financial assistance 
     authorized under certain Federal programs that might not 
     otherwise be possible without the use of volunteers, by 
     waiving the application of the otherwise applicable 
     prevailing wage-setting provisions of the Act of March 3, 
     1931 (commonly known as the ``Davis-Bacon Act'') (40 U.S.C. 
     276a et seq.) to such volunteers.

     SEC. 11003. WAIVER.

       (a) In General.--The requirement that certain laborers and 
     mechanics be paid in accordance with the wage-setting 
     provisions of the Act of March 3, 1931 (commonly known as the 
     ``Davis-Bacon Act'') (40 U.S.C. 276a et seq.) as set forth in 
     any of the Acts or provisions described in subsection (d), 
     and the provisions relating to wages, in any federally 
     assisted or insured contract or subcontract for construction, 
     shall not apply to any individual--
       (1) who volunteers--
       (A) to perform a service for a public or private entity for 
     civic, charitable, or humanitarian reasons, without promise, 
     expectation, or receipt of compensation for services rendered 
     other than expenses, reasonable benefits, or a nominal fee 
     (as defined in subsection (b)), but solely for the personal 
     purpose or pleasure of the individual; and
       (B) to provide such services freely and without pressure or 
     coercion, direct or implied, from an employer;
       (2) whose contribution of service is not for the benefit of 
     any contractor otherwise performing or seeking to perform 
     work on the same project; and
       (3) who is not otherwise employed at any time under the 
     federally assisted or insured contract or subcontract 
     involved for construction with respect to the project for 
     which the individual is volunteering.
       (b) Expenses.--Payments of expenses, reasonable benefits, 
     or a nominal fee may be provided to volunteers described in 
     subsection (a) if the Secretary of Labor determines, after an 
     examination of the total amount of payments made (relating to 
     expenses, benefits, or fees) in the context of the economic 
     realities of the specific federally assisted or insured 
     project, that such payments are appropriate. Subject to such 
     a determination--
       (1) a payment for an expense may be received by a volunteer 
     for items such as uniform allowances, protective gear and 
     clothing, reimbursement for approximate out-of-pocket 
     expenses, or for the cost or expense of meals and 
     transportation;
       (2) a reasonable benefit may include the inclusion of a 
     volunteer in a group insurance plan (such as a liability, 
     health, life, disability, or worker's compensation plan) or 
     pension plan, or the awarding of a length of service award; 
     and
       (3) a nominal fee may not be used as a substitute for 
     compensation and may not be tied to productivity.
     The decision as to what constitutes a nominal fee for 
     purposes of paragraph (3) shall be made on a case-by-case 
     basis and in the context of the economic realities of the 
     situation involved.
       (c) Economic Reality.--For purposes of subsection (b), in 
     determining whether an expense, benefit, or fee described in 
     such subsection may be paid to volunteers in the context of 
     the economic realities of the particular situation, the 
     Secretary of Labor shall not approve any such expense, 
     benefit, or fee that has the effect of undermining labor 
     standards by creating downward pressure on prevailing wages 
     in the local construction industry.
       (d) Contracts Exempted.--For purposes of subsection (a), 
     the Acts or provisions described in this subsection are the 
     following:
       (1) The Library Services and Construction Act (20 U.S.C. 
     351 et seq.).
       (2) The Indian Self-Determination and Education Assistance 
     Act (25 U.S.C. 450 et seq.).
       (3) Section 329 of the Public Health Service Act (42 U.S.C. 
     254b).
       (4) Section 330 of the Public Health Service Act (42 U.S.C. 
     254c).

     SEC. 11004. REPORT.

       Not later than December 31, 1997, the Secretary of Labor 
     shall prepare and submit to the appropriate committees of 
     Congress a report that--
       (1) identifies and assesses, to the maximum extent 
     practicable--
       (A) the projects for which volunteers were permitted to 
     work under this title; and
       (B) the number of volunteers permitted to work because of 
     the compliance of entities with the provisions of this title; 
     and
       (2) contains recommendations with respect to Acts related 
     to the Davis-Bacon Act that could be addressed to permit 
     volunteer work.


                     MOTION OFFERED BY MR. CONYERS

  Mr. CONYERS. Mr. Speaker, I offer a motion.
  The Clerk read as follows:

       Mr. Conyers moves to strike all after the enacting clause 
     of the Senate bill, S. 1587, and to insert in lieu thereof 
     the provisions of H.R. 2238, as passed by the House.

  The SPEAKER pro tempore. Without objection, the motion is agreed to.
  There was no objection.
  The Senate bill was ordered to be read a third time, was read the 
third time, and passed, and a motion to reconsider was laid upon the 
table.
  A similar House bill (H.R. 2238) was laid on the table.

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