[Congressional Record Volume 144, Number 37 (Friday, March 27, 1998)]
[Senate]
[Pages S2719-S2720]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DOMENICI (for himself, Mr. Lieberman, Mr. Thompson, Mr. 
        Bingaman,  and Mr. Reid):
  S. 1874. A bill to improve the ability of small businesses, Federal 
agencies, industry, and universities to work with Department of Energy 
contractor-operated facilities, and for other purposes; to the 
Committee on Energy and Natural Resources.


   the department of ENERGY SMALL business and INDUSTRY PARTNERSHIP 
                        enhancement act OF 1998

  Mr. DOMENICI. Mr. President, partnerships among our federal 
laboratories, universities, and industry provide important benefits to 
our nation. They help to create innovative new products and services 
that drive our economy and improve our quality of life.
  I have personally observed the positive impacts of well crafted 
partnerships. These partnerships enhance the ability of the 
laboratories and other contractor-operated facilities of the Department 
of Energy to accomplish their federal missions at the same time that 
the companies benefit though enhanced competitiveness from the 
technical resources available at these sites.
  I have also seen important successes achieved by other federal 
agencies and companies that utilized the resources of the national 
laboratories and other Department sites through contract research 
mechanisms. Contract research enables these sites to contribute their 
technical expertise in cases where the private sector can not supply a 
customer's needs. Partnerships and other interactions enable companies 
and other agencies to accomplish their own missions better, faster, and 
cheaper.
  I've seen spectacular examples where small businesses have been 
created around breakthrough technologies from the national laboratories 
and other contractor-operated sites of the DOE. But, at present, only 
the Department's Defense Programs has a specific program for small 
business partnerships and assistance.
  All programs of the Department have expertise that can be driving 
small business successes. Historically, in the United States, small 
businesses have often been the most innovative and the fastest to 
exploit new technical opportunities--all of the Department's programs 
should be open to the small business interactions that Defense Programs 
has so effectively utilized.
  I have been concerned that barriers to these partnerships and 
interactions continue to exist within the Department of Energy. In 
addition, the Department's laboratories and other sites need continuing 
encouragement to be fully receptive to partnership opportunities that 
meet both their own mission objectives and industry's goals. And 
finally, small business interactions should be encouraged across the 
Department of Energy, not only in Defense Programs.
  For these reasons, I introduce today the Department of Energy Small 
Business and Industry Partnership Enhancement Act of 1998. This 
Partnership Enhancement Act removes barriers to more effective 
utilization of all of the Department's contractor-operated facilities 
by industry, other federal agencies, and universities. The bill covers 
all the Department's contractor-operated facilities--national 
laboratories and their other sites like Kansas City, Pantex, Hanford, 
Savannah River, or the Nevada Test Site.
  This bill also provides important encouragement to the contractor-
operated sites to increase their partnerships and other interactions 
with universities and companies. And finally, it creates opportunities 
for small businesses to benefit from the technical resources available 
at all of the Department's contractor-operated facilities.
  This bill amends the Atomic Energy Act, which limited the areas 
wherein the Department's facilities could provide contract research, 
not in competition with the private sector, to only those mission areas 
undertaken in the earliest days of the AEC. My bill recognizes that the 
Department's responsibilities are far broader than the original AEC, 
and that all parts of the Department should be available to help on a 
contract basis wherever capabilities are not available from private 
industry.
  One barrier at the Department to contract research involves charges 
added by the Department to the cost of work accomplished by a site. 
This bill requires that charges to customers for contract research at 
these facilities be fully recovered, and stops the addition of extra 
charges by the Department. The bill requires that any customer of

[[Page S2720]]

these facilities pay only the direct charges at that facility for their 
contracted work, plus an overhead rate that is calculated for broad 
groups of customers. For example, where other federal agencies, 
companies, or universities do not require secure facilities or do not 
utilize the extensive special nuclear material capabilities of the 
laboratories, then the customer will be charged an overhead rate that 
excludes security costs and environmental legacy costs. This will 
ensure that each class of customers is paying for the services they 
actually utilize.
  The bill provides direct encouragement for expansion of partnerships 
and interactions with companies and universities by requiring that each 
facility be annually judged for success in expanding these interactions 
in ways that support each facility's missions. The bill requires that 
the external partnership and interaction program be considered in 
evaluating the annual contract performance at each site.
  And finally, the bill sets up a new Small Business Partnership 
Program in which all of the Department sites participate. This action 
will enable small businesses across the United States to better access 
and partner with any of the Department's contractor-owned facilities. A 
fund for such interactions up to 0.25 percent of the total site budget 
is available for these small business interactions.
  With these changes, Mr. President, the Department of Energy 
facilities will be better able to meet their critical national 
missions, while at the same time assisting other federal agencies, 
large and small businesses, and universities in better meeting their 
goals and missions.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1874

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Department of Energy Small 
     Business and Industry Partnership Enhancement Act of 1998''.

     SEC. 2. FINDINGS.

       Congress finds that--
       (1) partnerships between contractor-operated facilities of 
     the Department of Energy and small businesses can enhance 
     growth of competitive small business opportunities;
       (2) the contractor-operated facilities represent a national 
     resource in science and technology;
       (3) capacity for innovation in the United States is 
     enhanced when the capabilities of the contractor-operated 
     facilities are engaged with other providers and users of the 
     Nation's science and technology base;
       (4) contributors to the Nation's science and technology 
     delivery system, Federal agencies, private industry, 
     universities, and the contractor-operated facilities can best 
     perform their missions through partnerships and interactions 
     that leverage the resources of each such entity;
       (5) interactions of the contractor-operated facilities with 
     industry and universities serve to--
       (A) expand the technology base available for missions of 
     the Department of Energy; and
       (B) instill sound business practices in the contractor-
     operated facilities to enable cost-effective realization of 
     the Federal missions of the facilities;
       (6) the contractor-operated facilities benefit from 
     university interactions through access to leading edge 
     research and through recruitment of the talent needed to 
     pursue the missions of the facilities;
       (7) industry can improve products and processes leading to 
     an enhanced competitive position through simplified access to 
     the science and technology developed by the contractor-
     operated facilities; and
       (8) other Federal agencies can advance their own missions 
     by using capabilities developed within the contractor-
     operated facilities.

     SEC. 3. PURPOSES.

       The purposes of this Act are--
       (1) to improve the ability of small businesses, Federal 
     agencies, industry, and universities to work with the 
     contractor-operated facilities of the Department of Energy 
     while ensuring full cost recovery of each contractor-operated 
     facility's expenses incurred in such work;
       (2) to encourage the contractor-operated facilities to 
     expand their partnerships with universities and industries; 
     and
       (3) to expand interactions of contractor-operated 
     facilities with small businesses so as to--
       (A) encourage commercial evaluation and development of the 
     science and technology base of the contractor-operated 
     facilities; and
       (B) provide technical assistance to small businesses.

     SEC. 4. CONTRACT RESEARCH SERVICES.

       Section 31a. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2051(a)) is amended--
       (1) in paragraph (5), by striking ``and'' at the end;
       (2) in paragraph (6), by striking the period at the end and 
     inserting ``; and''; and
       (3) by adding at the end the following:
       ``(7) areas of technology within the mission of the 
     Department of Energy as authorized by law.''.

     SEC. 5. COST RECOVERY.

       Section 33 of the Atomic Energy Act of 1954 (42 U.S.C. 
     2053) is amended--
       (1) by striking ``Sec. 33. Research for Others.--Where'' 
     and inserting the following:

     ``SEC. 33. RESEARCH FOR OTHERS.

       ``(a) In General.--Where''; and
       (2) by striking the last sentence and inserting the 
     following:
       ``(b) Cost Recovery.--
       ``(1) In general.--In carrying out subsection (a), the 
     Secretary of Energy shall not recover more than the full cost 
     of work incurred at contractor-operated facilities of the 
     Department of Energy.
       ``(2) Administrative costs.--Any costs incurred by the 
     Department of Energy in connection with work performed by 
     contractor-operated facilities of the Department of Energy 
     shall be funded from departmental administration accounts of 
     the Department of Energy.
       ``(3) Charges.--For work performed for a person other than 
     the Department of Energy (including non-Federal entities and 
     Federal agencies other than the Department of Energy) 
     (referred to in this paragraph as an `external customer'), a 
     contractor-operated facility may assess a charge in an amount 
     that does not exceed the sum of --
       ``(A) the direct cost to the contractor in performing the 
     work for the external customer; and
       ``(B) a pro rata share of overhead charges for overhead-
     funded services directly required for performance of the 
     specific work for external customers as a whole or to a 
     category of external customers that includes the external 
     customer.''.

     SEC. 6. PARTNERSHIPS WITH UNIVERSITIES AND INDUSTRY.

       (a) In General.--Chapter 4 of title I of the Atomic Energy 
     Act of 1954 (42 U.S.C. 2051 et seq.) is amended by adding at 
     the end the following:

     ``SEC. 34. CONTRACTOR-OPERATED FACILITIES OF THE DEPARTMENT 
                   OF ENERGY.

       ``(a) Metrics.--
       ``(1) Definition of metrics.--In this subsection, the term 
     `metrics' means a system of measurements to determine levels 
     of specific areas of performance.
       ``(2) Inclusion in contracts.--Metrics--
       ``(A) shall be developed jointly by the Secretary of Energy 
     and each contractor operating a facility of the Department of 
     Energy to ensure that realistic goals are established that 
     are directly supportive of the mission and responsibilities 
     of the contractor-operated facility;
       ``(B) shall be specified in the contract for operation of 
     the facility; and
       ``(C) shall be used to evaluate the effectiveness of 
     partnership development by the facility.
       ``(b) Partnerships and Interactions.--
       ``(1) Encouragement of partnerships and interactions.--The 
     Secretary of Energy shall encourage partnerships and 
     interactions with universities and private industry at each 
     contractor-operated facility.
       ``(2) Component of performance evaluations.--The 
     development and expansion of partnerships and interactions 
     with universities and private industry shall be a component 
     in evaluating the annual performance of each contractor-
     operated facility.
       ``(c) Small Business Technology Partnership Program.--
       ``(1) In general.--The Secretary of Energy shall require 
     that each contractor operating a facility of the Department 
     of Energy create a small business technology partnership 
     program at each contractor-operated facility.
       ``(2) Funding level.--A contractor may spend not more than 
     0.25 percent of the total operating budget of a contractor-
     operated facility on the program.
       ``(3) Evaluations.--The Secretary shall annually evaluate 
     the effectiveness of the program with each contractor to 
     ensure that the program is providing opportunities for small 
     businesses to interact with and use the resources of each 
     contractor-operated facility.
       ``(4) Use of funds.--Funds from the program--
       ``(A) shall be used to cover a contractor-operated 
     facility's costs of interactions with small businesses; and
       ``(B) shall not be used for direct monetary grants to small 
     businesses.''.
       (b) Conforming Amendment.--The table of contents of the 
     Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) is amended 
     by adding at the end of the items relating to chapter 4 of 
     title I the following:

``Sec. 34. Contractor-operated Facilities of the Department of 
              Energy.''.
                                 ______