[Congressional Record Volume 140, Number 89 (Tuesday, July 12, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: July 12, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
              FEDERAL ACQUISITION STREAMLINING ACT OF 1994

  The text of the bill (S. 2206) to revise and streamline the 
acquisition laws of the Federal Government, and for other purposes, as 
passed by the Senate on July 1, 1994, is as follows:

                                S. 2206

       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 XI--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,

     6before 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 
                   NONDEVELOPMENTAL 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.

                          ____________________