[Congressional Record Volume 147, Number 93 (Friday, June 29, 2001)]
[Senate]
[Pages S7195-S7257]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. HATCH (for himself, Mr. Feingold, Mr. Grassley, Mr. Leahy,
Mr. Warner, Mr. Breaux, Mr. Burns, Mr. Reid, Mr. Craig, Mr.
Torricelli, Mr. Bennett, Ms. Snowe, Mr. DeWine, Mr. Thomas, and
Mr. Hutchinson):
S. 1140. A bill to amend chapter 1 of title 9, United States Code, to
provide for greater fairness in the arbitration process relating to
motor vehicle franchise contracts; to the Committee on the Judiciary.
Mr. HATCH. Mr. President, I rise today to introduce S. 1140, ``The
Motor Vehicle Franchise Contract Arbitration Fairness Act of 2001.'' I
am pleased to be joined in cosponsorship of this legislation by
Senators Feingold, Grassley, Leahy, Warner, Breaux, Burns, Reid, Craig,
Torricelli, Bennett, Snowe, DeWine, Thomas, and Hutchinson. Our bill is
intended to allow automobile dealers their day in court when they have
disputes with the manufacturers.
As automobile dealers throughout Utah have pointed out to me, the
motor vehicle dealer contract often includes mandatory arbitration
clauses, and they also point out their unequal bargaining power. This
is usually the result of various factors, including the manufacturers'
discretion to allocate vehicle inventory and control on the timing of
delivery. Manufacturers can, thus, determine the dealer's financial
future with the allocation of the best-selling models. Manufacturers
can also exercise leverage over the flow of revenue to dealers, such as
warranty payments. Manufacturers can limit dealers' rights to transfer
ownership or control of the business, even to family members. And
manufacturers have tried, arbitrarily, to take businesses away from
dealers without cause.
I recognize the efficiencies of mandatory arbitration clauses in
general, but the specific circumstances in the manufacturer-dealer
relationship justifies this widely-supported bipartisan proposal. It is
worthy to note that Congress in 1956 enacted the Automobile Dealer Day
in Court Act, which provided a small business dealer in limited
circumstances the right to proceed in Federal court when faced with
abuses by manufacturers. And State legislatures have enacted
significant protections for auto dealers.
S. 1140 amends Title 9 of the U.S. Code and make arbitration of
disputes in motor vehicle franchise contracts optional. This would
allow dealers to opt voluntarily for arbitration or use procedures and
remedies available under State law, such as state-established
administrative boards specifically established to resolve dealer/
manufacturer disputes.
I must note that this legislation is extremely narrow and affects
only the unique relationship between small business auto dealers and
motor vehicle manufacturers, which is strictly governed by State law.
This legislation is necessary to protect the States' interest in
regulating the motor vehicle dealer/manufacturer relationship.
All States, except for Alaska, have enacted laws specifically
designed to regulate the economic relationship between motor vehicle
dealers and manufacturers to prevent unfair manufacturer contract terms
and practices. In most States, including my home State of Utah,
effective State administrative forums already exist to handle dealer/
manufacturer disputes outside of the court system. Indeed, in the
majority of States, a special State agency or forum is charged with
administering and enforcing motor vehicle franchise law. These State
forums provide an inexpensive, speedy, and non-judicial resolution of
disputes.
I urge my colleagues to support this worthwhile legislation.
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. 1140
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
[[Page S7196]]
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Motor Vehicle Franchise
Contract Arbitration Fairness Act of 2001''.
SEC. 2. ELECTION OF ARBITRATION.
(a) Motor Vehicle Franchise Contracts.--Chapter 1 of title
9, United States Code, is amended by adding at the end the
following:
``Sec. 17. Motor vehicle franchise contracts
``(a) For purposes of this section, the term--
``(1) `motor vehicle' has the meaning given such term under
section 30102(6) of title 49; and
``(2) `motor vehicle franchise contract' means a contract
under which a motor vehicle manufacturer, importer, or
distributor sells motor vehicles to any other person for
resale to an ultimate purchaser and authorizes such other
person to repair and service the manufacturer's motor
vehicles.
``(b) Whenever a motor vehicle franchise contract provides
for the use of arbitration to resolve a controversy arising
out of or relating to the contract, arbitration may be used
to settle such controversy only if after such controversy
arises both parties consent in writing to use arbitration to
settle such controversy.
``(c) Whenever arbitration is elected to settle a dispute
under a motor vehicle franchise contract, the arbitrator
shall provide the parties to the contract with a written
explanation of the factual and legal basis for the award.''.
(b) Technical and Conforming Amendment.--The table of
sections for chapter 1 of title 9, United States Code, is
amended by adding at the end the following:
``17. Motor vehicle franchise contracts.''.
SEC. 3. EFFECTIVE DATE.
The amendments made by section 2 shall apply to contracts
entered into, amended, altered, modified, renewed, or
extended after the date of the enactment of this Act.
Mr. GRASSLEY. Mr. President, over the years, I have been in the
forefront of promoting alternative dispute resolution, (ADR),
mechanisms to encourage alternatives to litigation when disputes arise.
Such legislation includes the permanent use of ADR by Federal agencies.
Last Congress, we also passed legislation to authorize Federal court-
annexed arbitration. These statutes are based, in part, on the premise
that arbitration should be voluntary rather than mandatory.
While arbitration often serves an important function as an efficient
alternative to court, some trade offs must be considered by both
parties, such a limited judicial review and less formal procedures
regarding discovery and rules of evidence. When mandatory binding
arbitration is forced upon a party, for example when it is placed in a
boiler-plate agreement, it deprives the weaker party the opportunity to
elect any other forum. As a proponent of arbitration I believe it is
critical to ensure that the selection of arbitration is voluntary and
fair.
Unequal bargaining power exists in contracts between automobile and
truck dealers and their manufacturers. The manufacturer drafts the
contract and presents it to dealers with no opportunist to negotiate.
Increasingly, these manufacturers are including compulsory binding
arbitration in their agreements, and dealers are finding themselves
with no choice but to accept it. If they refuse to sign the contract
they have no franchise. This clause then binds the dealer to
arbitration as the exclusive procedure for resolving any dispute. The
purpose of arbitration is to reduce costly, time-consuming litigation,
not to force a party to an adhesion contract to waive access to
judicial or administrative forums for the pursuit of rights under State
law.
I am extremely concerned with this industry practice that conditions
the granting or keeping of motor vehicle franchises on the acceptance
of mandatory and binding arbitration. While several States have enacted
statutes to protect weaker parties in ``take it or leave it'' contracts
and attempted to prevent hits type of inequitable practice, these State
laws have been held to conflict with the federal Arbitration Act (FAA).
In 1925, when the FAA was enacted to make arbitration agreements
enforceable in Federal courts, it did not expressly provide for
preemption of State law. Nor is there any legislative history to
indicate Congress intended to occupy the entire field of arbitration.
However, in 1984 the Supreme Court interpreted the FAA to preempt state
law in Southland Corporation v. Keating. This, State laws that protect
weaker parties from being forced to accept arbitration and to waive
State rights, such as Iowa's law prohibiting manufacturers from
requiring dealers to submit to mandatory binding arbitration, are
preempted by the FAA.
With mandatory binding arbitration agreements becoming increasingly
common in motor vehicle franchise agreements, now is the time to
eliminate the ambiguity in the FAA statute. The purpose of the
legislation we are introducing is to ensure that in disputes between
manufacturers and dealers, both parties must voluntarily elect binding
arbitration. This approach would continue to recognize arbitration as a
valuable alternative to court, but would provide an option to pursue
other forums such as administrative bodies that have been established
in a majority of States, including Iowa, to handle dealer/manufacturer
disputes.
This legislation will go a long way toward ensuring that parties will
not be forced into binding arbitration and thereby lose important
statutory rights. I am confident that given its many advantages
arbitration will often be elected. But it is essential for public
policy reasons and basic fairness that both parties to this type of
contract have the freedom to make their own decisions based on the
circumstances of the case.
I urge my colleagues to join me in supporting this legislation to
address this unfair franchise practice.
Mr. FEINGOLD. Mr. President, I rise today to introduce, with my
distinguished colleague from Utah, Senator Hatch, the Motor Vehicle
Franchise Contract Arbitration Fairness Act of 2001. I want to
recognize the efforts of the Senator from Iowa, Senator Grassley, in
advancing this legislation in the last Congress, and note how pleased I
am that the distinguished ranking member and former chairman of the
Judiciary Committee has decided to take the lead on this bill this
year. By the time the 106th Congress concluded, we had the support of
56 Senators for this bill. So I believe we have an excellent
opportunity to pass this bill this year, and I look forward to working
with the Senator from Utah to make that happen.
While alternative methods of dispute resolution such as arbitration
can serve a useful purpose in resolving disputes between parties, I am
extremely concerned about the increasing trend of stronger parties to a
contract forcing weaker parties to waive their rights and agree to
arbitrate any future disputes that may arise. In every Congress since
1994, I have introduced the Civil Rights Procedures Protection Act,
which amends certain civil rights statutes to prevent the involuntary
imposition of arbitration to claims that arise from unlawful employment
discrimination and sexual harassment.
A few years ago, it came to my attention that the automobile and
truck manufacturers, which often present dealers with ``take it or
leave it'' contracts, are increasingly including mandatory and binding
arbitration clauses as a condition of entering into or maintaining an
auto or truck franchise. This practice forces dealers to submit their
disputes with manufacturers to arbitration. As a result, dealers are
required to waive access to judicial or administrative forums,
substantive contract rights, and statutorily provided protection. In
short, this practice clearly violates the dealers' fundamental due
process rights and runs directly counter to basic principles of
fairness.
Franchise agreements for auto and truck dealerships are typically not
negotiable between the manufacturer and the dealer. The dealer accepts
the terms offered by the manufacturer, or it loses the dealership,
plain and simple. Dealers, therefore, have been forced to rely on the
States to pass laws designed to balance the manufacturers' far greater
bargaining power and to safeguard the rights of dealers. The first
State automobile statute was enacted in my home State of Wisconsin in
1937 to protect citizens from injury caused when a manufacturer or
distributor induced a Wisconsin citizen to invest considerable sums of
money in dealership facilities, and then canceled the dealership
without cause. Since then, all States except Alaska have enacted
substantive law to balance the enormous bargaining power enjoyed by
manufacturers over dealers and to safeguard small business dealers from
unfair automobile and truck manufacturer practices.
[[Page S7197]]
A little known fact is that under the Federal Arbitration Act, FAA,
arbitrators are not required to apply the particular Federal or State
law that would be applied by a court. That enables the stronger party,
in this case the auto or truck manufacturer, to use arbitration to
circumvent laws specifically enacted to regulate the dealer/
manufacturer relationship. Not only is the circumvention of these laws
inequitable, it also eliminates the deterrent to prohibited acts that
State law provides.
The majority of States have created their own alternative dispute
resolution mechanisms and forums with access to auto industry expertise
that provide inexpensive, efficient, and non-judicial resolution of
disputes. For example, in Wisconsin, mandatory mediation is required
before the start of an administrative hearing or court action.
Arbitration is also an option if both parties agree. These State
dispute resolution forums, with years of experience and precedent, are
greatly responsible for the small number of manufacture-dealer
lawsuits. When mandatory binding arbitration is included in dealer
agreements, these specific State laws and forums established to resolve
auto dealer and manufacturer disputes are effectively rendered null and
void with respect to dealer agreements.
Besides losing the protection of Federal and State law and the
ability to use State forums, there are numerous reasons why a dealer
may not want to agree to binding arbitration. Arbitration lacks some of
the important safeguards and due process offered by administrative
procedures and the judicial system: 1. arbitration lacks the formal
court supervised discovery process often necessary to learn facts and
gain documents; 2. an arbitrator need not follow the rules of evidence;
3. arbitrators generally have no obligation to provide factual or legal
discussion of the decision in a written opinion; and 4. arbitration
often does not allow for judicial review.
The most troubling problem with this sort of mandatory binding
arbitration is the absence of judicial review. Take for instance a
dispute over a dealership termination. To that dealer, that small
business person, this decision is of commercial life or death
importance. Even under this scenario, the dealer would not have
recourse to substantive judicial review of the arbitrators' ruling. Let
me be very clear on this point; in most circumstances an arbitration
award cannot be vacated, even if the arbitration panel disregarded
state law that likely would have produced a different result.
The use of mandatory binding arbitration is increasing in many
industries, but nowhere is it growing more steadily than the auto/truck
industry. Currently, at least 11 auto and truck manufacturers require
some form of such arbitration in their dealer contracts.
In recognition of this problem, many States have enacted laws to
prohibit the inclusion of mandatory binding arbitration clauses in
certain agreements. The Supreme Court, however, held in Southland Corp.
v. Keating, 104 S. Ct. 852 (1984), that the FAA by implication preempts
these State laws. This has the effect of nullifying many State
arbitration laws that were designed to protect weaker parties in
unequal bargaining positions from involuntarily signing away their
rights.
The legislative history of the FAA indicates that Congress never
intended to have the Act used by a stronger party to force a weaker
party into binding arbitration. Congress certainly did not intend the
FAA to be used as a tool to coerce parties to relinquish important
protections and rights that would have been afforded them by the
judicial system. Unfortunately, this is precisely the current
situation.
Although contract law is generally the province of the States, the
Supreme Court's decision in Southland Corp. has in effect made any
State action on this issue moot. Therefore, along with Senator Hatch, I
am introducing this bill today to ensure that dealers are not coerced
into waiving their rights. Our bill, the Motor Vehicle Franchise
Contract Arbitration Fairness Act of 2001, would simply provide that
each party to an auto or truck franchise contract has the option of
selecting arbitration, but cannot be forced to do so.
The bill would not prohibit arbitration. On the contrary, the bill
would encourage arbitration by making it a fair choice that both
parties to a franchise contract may willingly and knowingly select. In
short, this bill would ensure that the decision to arbitrate is truly
voluntary and that the rights and remedies provided for by our judicial
system are not waived under coercion.
In effect, if small business owners today want to obtain or keep
their auto or truck franchise, they may be able to do so only by
relinquishing their legal rights and foregoing the opportunity to use
the courts or administrative forums. I cannot say this more strongly,
this is unacceptable; this is wrong. It is at great odds with our
tradition of fair play and elementary notions of justice. I therefore
urge my colleagues to join in this bipartisan effort to put an end to
this invidious practice.
______
By Mr. LIEBERMAN:
S. 1142. A bill to amend the Internal Revenue Code of 1986 to repeal
the minimum tax preference for exclusion for incentive stock options;
to the Committee on Finance.
Mr. LIEBERMAN. Mr. President, today I am reintroducing a proposal
with regard to the perverse impact of the Alternative Minimum Tax, AMT,
on Incentive Stock Options, ISOs. I previously introduced this proposal
on April 30, 2001, as Section 5 of S. 798, the Productivity,
Opportunity, and Prosperity Act of 2001. I am reintroducing this
proposal as a separate bill to highlight the importance of this issue.
Incentive stock options and the AMT did not exist when Franz Kafka's
``The Castle'' was published in 1926. The book describes the relentless
but futile efforts of the protagonist, K., to gain recognition from the
mysterious authorities ruling from their castle a village where K.
wants to establish himself. The world he inhabits is both absurd and
real. Kafka's characters are trapped, and punished or threatened with
punishment before they even have offended the authorities.
The AMT/ISO interaction would be one that Kafka would appreciate. In
the case of ISOs an employee who receives ISOs as an incentive can be
taxed on the phantom paper gains the tax code deems to exist when he or
she exercises an option, and be required to pay the AMT tax on these
``gains'' even if the ``gains'' do not, in fact, exist when the tax is
paid. This means the taxpayer may have no gains, no profits or assets,
with which to pay the AMT and might even have to borrow funds to pay
the tax or even go into default on his or her AMT liability.
This Kafkaesque situation is unfair. It is not fair to impose tax on
``income'' or ``gains'' unless the income or gains exist. With the AMT
tax on ISOs, it is not relevant if the ``gains'' exist in a financial
sense. That they exist on paper is sufficient to trigger the tax.
This situation is also inconsistent with many well-established
Federal Government policies. For example, our country favors stock
options as an incentive for hard-working and productive employees of
entrepreneurial companies. In most cases, entrepreneurs take enormous
risks, receive less compensation than employees working for established
companies, and have no company-sponsored pension plan. In addition, our
country favors employee-ownership of firms. This ownership gives these
employees a huge stake in the success of the company and motivates them
to dedicate themselves to the firm's success. Finally, our country also
favors long-term investments that generate growth. We know that growth
is most likely to arise when entrepreneurs take risks over the long-
term and build fundamental value for their companies and shareholders
and owners. The policy favoring long-term investments is reflected in
the fact that capital gains incentives are available only if an
investment is held for at least one year. An investment sold before the
end of this ``holding period'' receives no capital gains benefit. The
application of the AMT to ISOs is inconsistent with all three of these
public policies.
Let me explain the difference between ISOs and NSOs. Incentive stock
options are sanctioned by the Internal Revenue code. Under current law
the employee pays no tax when he or she exercises the option and buys
the company's shares at the stock option price. The company receives no
tax deduction
[[Page S7198]]
on the spread, the difference between the option price and the market
price of the stock. If the employee holds the stock for two years after
the grant of the option and one year after the exercise of the option,
he or she pays the capital gains tax on the difference between the
exercise and sale price on the sale of the stock. The tax payment is
deferred until the stock is sold and the tax is paid on the real gains
that are realized from the sale.
NSOs are stock options that do not satisfy the tax code requirements
for ISOs. They are ``non-qualifying stock options'' or NSOs. With NSOs
the employee is taxed immediately when the option is exercised on the
spread between the grant and exercised price. This forces an employee
to sell stock as soon as he or she exercise their options so that they
can pay the tax on the spread. This is a zero sum game for the
employee, selling the stock he or she has just bought to pay a tax on
the spread. Even worse, because the stock is not ``held'' for one year,
this tax is paid at the ordinary income tax rates, not the preferential
capital gains tax rates. The company receives a business expense
deduction on the spread.
If this were the whole story, it is clear that companies would tend
to offer ISOs rather than NSOs to their employees. Employees would be
encouraged to hold their shares for at least a year after the option is
exercised, which helps to bind them to the company. They would then
qualify for capital gains tax rates on the realized gains.
The problem is that ISOs come with a major liability, the application
of the Alternative Minimum Tax, AMT, to the spread at the time of
exercise. This tax is due to be paid even if the stock is held for the
required period and even if the stock is eventually sold at a fraction
of its value at the time the option is exercised. This tax at the time
of exercise is inconsistent with the rule that applies to all other
capital gains transactions, where the tax is paid when the gains are
``realized,'' when the investment is sold with gains or losses. This
tax at the time of exercise defeats the purpose of ISOs, forces
employees to sell their stock, to pay the AMT tax, before the end of
the holding period, and pay ordinary income tax rates. The difference
between ordinary income tax rates and capital gains tax rates can be 15
percent or more.
The AMT tax is imposed on the spread at the time the option is
exercised and it is irrelevant if the stock price at the time when the
AMT tax is paid or when the stock is sold is a fraction of this price.
The ``gains'' at the time of exercise are what count, not real gains in
a financial sense when the investment is finally sold.
The application of the AMT at the time of exercise to ISOs is a major
disincentive for companies to offer ISOs to their employees. The
purpose of the ISO law when it was enacted by Congress back in 1981 was
to encourage long-term holdings of the stock. This purpose is defeated
by the AMT application at the time of exercise. Even if firms could
educate their employees about the AMT liability, the fact that this tax
is imposed at the time of exercise on phantom gains would remain a
major disincentive for them to offer ISOs. The risks are too great that
the employee will have no real gains with which to pay the tax, that
employee will have to sell stock immediately at ordinary income tax
rates to make sure that funds are available to pay the tax when it is
due, or take the risk of holding the stock.
My understanding is that the firms that are most likely to grant ISOs
are those firms that have no ability to use the corporate deduction
that is available for NSOs. These are small firms with no tax liability
for which the deduction is simply a tax loss carryforward with no
current year value. With these firms the ISO held out the possibility
of the employees receiving capital gains tax treatment of their gains.
It is particularly sad that it is these firms and these employees which
are feeling the brunt of the AMT/ISO problem.
The application of the AMT to ISOs is strange because long-term
holdings of stock, as required by the ISO law, are classic capital
gains transactions and we do not apply the AMT to the tax benefit
conferred by the capital gains tax. Under the AMT only ``tax preference
items'' enumerated in the AMT are included when the AMT calculation is
made. The capital gains differential, the difference between the
ordinary tax rate on income and the lower capital gains rate, is a tax
benefit but that differential is not included in the AMT. Given all the
problems we are now seeing with the AMT the capital gains differential
should not be included as a preference item. But, by an accident of
history, the AMT is still applied to ISOs. This makes no sense and it
is an anomaly in the tax code. When the Congress restored the capital
gains differential, and did not include it as an AMT tax preference
item, we should have enacted a conforming amendment regarding the AMT
and ISOs. We didn't, and we should do so now.
With the AMT applied to ISOs, taxpayers are caught in a Catch-22
situation. If they hold the stock for the required year, they can
qualify for capital gains treatment on the eventual sale of the stock.
But, in doing so they are taking a huge risk that the AMT tax bill will
exceed the value of the stock when the AMT is paid. If the tax is too
large, they may have to sell their stock before the capital gains
holding period has run and pay ordinary income tax rates on any gains.
This is a form of lottery that serves no public policy.
The AMT was created to ensure the rich cannot use tax shelters to
avoid paying their ``fair share.'' Taxpayers are supposed to calculate
both their regular tax and the AMT bill, then pay whichever is higher.
The AMT is likely to snare 1.5 million taxpayers this year and nearly
36 million by 2010. But the case with ISOs is one where the taxpayers
may never see the ``gains,'' and noneless owe a tax on them. Whatever
the merits might be for the AMT for taxpayers with real gains, they
have no bearing on taxpayers who may never see the gains. It is simply
unfair to impose a tax on gains that exist only on paper. If the
employee does realize gains, they should and will pay tax on them, but
only if and when the gains are realized.
Of course, with the recent huge drop in values for some stocks, many
entrepreneurs are now being hit with immense AMT tax bills on the paper
gains on stocks that are now worth a fraction of the price at the time
of exercise. At a townhall meeting held in California by Representative
Lofgren and Representative Bob Matsui, Kathy Swartz, a Mountain View
woman, six months pregnant and soon to sell her ``dream house'' because
she and her husband Karl owe $2.4 million in AMT, asked, ``How many
victims do you need before you say it's horrible?'' We are talking
about taxpayers who in fact owe five- to seven-figure tax bills on
gains they never realized.
My bill would change those tax rules so that the AMT no longer
applies to ISOs and no tax is owed at the time when the entrepreneur
exercises the option. This change would eliminate the unfair taxation
of paper gains on ISOs. This would encourage long-term holdings of
stock, not immediate sale of the stock as a hedge against AMT tax
liability. It would do nothing to exempt entrepreneurs from paying tax
on their real gains when they eventually sell the stock.
My bill would solve this problem going forward. It would not, as
drafted, provide relief to the taxpayers who already have been hit with
AMT taxes on phantom gains. There is a bipartisan group in the House
and Senate focusing on this group of taxpayers. This group has a strong
claim for relief based on the inherent unfairness of the AMT as applied
to ISOs. The unfairness of this law leads me to call for reform going
forward should be remedied for current, as well as future taxpayers.
Let me be clear about the cost and budget implications of my bill.
The Joint Tax Committee on Taxation has found that my proposal would
reduce government tax revenues by $12.412 billion over ten years. I am
puzzled by this estimate, but there is no way for me to appeal it. The
JTC does not provide explanations for its estimates, but I would assume
that this estimate is based on the likelihood that there would be fewer
tax payments at the time options are exercised as firms move from NSOs
to ISOs, those employees with ISOs would not be paying the AMT, and
there will be more employees who hold the stock and pay capital gains
tax rates. Offsetting this,
[[Page S7199]]
there will be fewer companies taking the deduction for NSOs. The
revenue loss year-by-year is as follows: --$1.821 billion (2002), --
$1.126 (2003), --$858 (2004), --$825 (2005), --$941 (2006), --$1.106
(2007), --$1.341 (2009), --$1.620 (2010), and $1.910 (2011). The loss
during the 2002-2006 period is --$5.494 billion. I will not propose to
enact my bill unless this sum is financed and will have no impact on
the Federal budget.
I am pleased that Rep. Zoe Lofgren (D-CA) has introduced legislation
on AMT/ISO in the other body (H.R. 1487). Her bill has attracted a
bipartisan group of cosponsors. I look forward to working with her and
other Members to remedy this inequity in the tax code and to do so with
regard to current as well as future taxpayers.
Let me note that I have proposed in S. 798 to provide a special
capital gains tax rate, in fact to set a zero tax rate, for stock
purchased by employees in stock option plans, by investors in Initial
Public Offerings, and similar purchases of company treasury stock. This
zero rate would be effective, however, only if the shares are held for
at least three years, so the AMT gamble would be even more dramatic.
During the first year of that holding period, the AMT would have to be
paid and during the remaining period the value of the stock could well
dive from the exercise price creating an even more invidious trap.
Kafka ``The Castle'' should remain as magnificent fiction. We have no
place for taxes on phantom income and paper gains. Our taxpayers should
be able to communicate effectively with the castle, not be caught in a
bureaucratic nightmare that makes no sense and serves no policy.
______
By Mr. CAMPBELL:
S. 1143. A bill to require the Secretary of the Treasury to mint
coins in commemoration of former President Ronald Reagan; to the
Committee on Banking, Housing, and Urban Affairs.
Mr. CAMPBELL. Mr. President, today I introduce the ``Ronald Reagan
Commemorative Coin Act of 2001.''
The bill I am introducing today would accomplish two worthy goals.
First, it would help honor Ronald Reagan, the 40th President of the
United States. Second, it would also help raise much needed resources
to help families across the United States provide care for their loved
ones who have been stricken by Alzheimer's disease.
I believe that a commemorative coin program would honor Ronald
Reagan's life and contributions to our Nation, while also raising funds
to help American families in their day to day struggle against this
terrible disease.
This legislation's worthiness and timeliness were underscored just
last night when ABC televised a powerful program in which Diane Sawyer
interviewed Nancy Reagan. Watching Mrs. Reagan as she so openly and
eloquently shared touching insights about their ongoing struggle with
Alzheimer's disease was moving. There is no doubt about the truly deep
bonds that unite Ronald and Nancy Reagan and that we need to do what we
can to fight the disease that has slowly taken its terrible toll on the
Reagans and so many other American families.
Ronald Reagan has worn many hats in his life, including endeavors as
a sports announcer, actor, governor and President of the United States.
He was first elected president in 1980 and served two terms, becoming
the first president to serve two full terms since Dwight Eisenhower.
Ronald Reagan's boundless optimism and deep-seated belief in the
people of the United States and the American Dream helped restore our
Nation's pride in itself and brought about a new ``Morning in
America.'' His challenge to Gorbachev to ``tear down this wall,'' his
successful revival of our economic power, his determination to rebuild
our armed forces in order to contain the spread of communism, and his
international summitry skills as seen at Reykjavik, Iceland, combined
to help bring an end to the Cold War. Ronald Reagan left our Nation in
much better shape than it was when he took office.
As Alzheimer's sets in, brain cells gradually deteriorate and die.
People afflicted by the disease gradually lose their cognitive ability.
Patients eventually become completely helpless and dependent on those
around them for even the most basic daily needs. Each of the millions
of Americans who is now affected will eventually, barring new
discoveries in treatment, lose their ability to remember recent and
past events, family and friends, even simple things like how to take a
bath or turn on lights. Ronald Reagan, one of the most courageous and
optimistic Presidents in American history, is no exception.
Shortly after being shot in an assassination attempt, Ronald Reagan's
courage and good humor in the face of a life threatening situation were
evident when he famously apologized to his wife Nancy saying ``Sorry
honey. I forgot to duck.'' Unfortunately, once Alzheimer's disease
takes hold, it delivers a slow mind destroying bullet that none of us
can duck to avoid. As Ronald Reagan wrote shortly after learning of his
diagnosis ``I only wish there was some way I could spare Nancy from
this painful experience.'' From the moment of diagnosis, it's ``a truly
long, long, goodbye,'' Nancy Reagan said.
Fortunately for all of us, when Ronald Reagan courageously announced
in such an honest and public manner that he had Alzheimer's, rather
than covering it up, he did a great deal to help alleviate the negative
stigma that has long faced those suffering from this terrible disease.
Much of the shame and pity traditionally associated with Alzheimer's
was transformed almost overnight into sympathy and understanding as
public awareness suddenly shot up and those suffering from Alzheimer's,
and their families, knew that they were not alone.
While Ronald Reagan's health didn't deteriorate right away, according
to Mrs. Reagan, he had his good days and bad days, ``just like
everybody else.'' In recent years, however, Reagan's condition has
completely deteriorated. ``It's frightening and it's cruel,'' Nancy
said, speaking of the disease and what it has done to her husband and
family. ``It's sad to see somebody you love and have been married to
for so long, with Alzheimer's, and you can't share memories,'' Mrs.
Reagan said.
In the introduction to a recently released book based on the touching
love letters exchanged between herself and Reagan, Nancy elaborated on
her sense of loss when she wrote, ``You know that it's a progressive
disease and that there's no place to go but down, no light at the end
of the tunnel. You get tired and frustrated, because you have no
control and you feel helpless.'' She also said, ``There are so many
memories that I can no longer share, which makes it very difficult.''
Nancy Reagan has earned our Nation's admiration for her steadfast and
loving dedication to her husband as she has watched her beloved husband
slowly fade away. Likewise, families all across our Nation, day in and
day out, choose to personally provide care for their loved ones
suffering from Alzheimer's, rather than putting them in institutions.
They deserve our respect and support.
Fortunately, Nancy Reagan has had access to vital resources that help
her care for her husband. This is how it should be. Unfortunately,
there are many American families out there who do not have access to
these resources. This bill will help alleviate that by raising money to
help American families who are struggling while providing care for
their loved ones.
Fortunately, funding for Alzheimer's research has increased
significantly over the past several years. Ronald Reagan's courage in
coming forward and publically announcing his condition played an
important role in raising public awareness of Alzheimer's and paved the
way for the recent increases in research funding. This bill would
complement these efforts.
Once again, the legislation I am introducing today authorizes the
U.S. Mint to produce commemorative coins honoring Ronald Reagan while
raising funds to help families care for their family members suffering
from Alzheimer's disease. I urge my colleagues to support passage of
this legislation.
Ronald Reagan's eternal optimism and deep seated belief in an even
better future for our Nation was underscored when he said, ``I know
that for America, there will always be a bright future ahead.'' This
bill, in keeping with this quote's spirit, will help provide for a
better future for many American families.
[[Page S7200]]
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. 1143
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 ``Ronald Reagan Commemorative
Coin Act of 2001''.
SEC. 2. COIN SPECIFICATIONS.
(a) Denominations.--The Secretary of the Treasury
(hereafter in this Act referred to as the ``Secretary'')
shall mint and issue the following coins:
(1) $5 gold coins.--Not more than 100,000 $5 coins, which
shall--
(A) weigh 8.359 grams;
(B) have a diameter of 0.850 inches; and
(C) contain 90 percent gold and 10 percent alloy.
(2) $1 silver coins.--Not more than 500,000 $1 coins, which
shall--
(A) weigh 26.73 grams;
(B) have a diameter of 1.500 inches; and
(C) contain 90 percent silver and 10 percent copper.
(b) Bimetallic Coins.--The Secretary may mint and issue not
more than 200,000 $10 bimetallic coins of gold and platinum
instead of the gold coins required under subsection (a)(1),
in accordance with such specifications as the Secretary
determines to be appropriate.
(c) Legal Tender.--The coins minted under this Act shall be
legal tender, as provided in section 5103 of title 31, United
States Code.
SEC. 3. SOURCES OF BULLION.
(a) Platinum and Gold.--The Secretary shall obtain platinum
and gold for minting coins under this Act from available
sources.
(b) Silver.--The Secretary may obtain silver for minting
coins under this Act from stockpiles established under the
Strategic and Critical Materials Stock Piling Act and from
other available sources.
SEC. 4. DESIGN OF COINS.
(a) Design Requirements.--
(1) In general.--The design of the coins minted under this
Act shall--
(A) be emblematic of the presidency and life of former
President Ronald Reagan;
(B) bear the likeness of former President Ronald Reagan on
the obverse side; and
(C) bear a design on the reverse side that is similar to
the depiction of an American eagle carrying an olive branch,
flying above a nest containing another eagle and hatchlings,
as depicted on the 2001 American Eagle Gold Proof coins.
(2) Designation and inscriptions.--On each coin minted
under this Act, there shall be--
(A) a designation of the value of the coin;
(B) an inscription of the year ``2005''; and
(C) inscriptions of the words ``Liberty'', ``In God We
Trust'', ``United States of America'', and ``E Pluribus
Unum''.
(b) Design Selection.--The design for the coins minted
under this Act shall be--
(1) selected by the Secretary, after consultation with the
Commission of Fine Arts; and
(2) reviewed by the Citizens Commemorative Coin Advisory
Committee.
SEC. 5. ISSUANCE OF COINS.
(a) Quality of Coins.--Coins minted under this Act shall be
issued in uncirculated and proof qualities.
(b) Mint Facility.--Only one facility of the United States
Mint may be used to strike any particular combination of
denomination and quality of the coins minted under this Act.
(c) Period for Issuance.--The Secretary may issue coins
minted under this Act only during the period beginning on
January 1, 2005 and ending on December 31, 2005.
SEC. 6. SALE OF COINS.
(a) Sale Price.--The coins issued under this Act shall be
sold by the Secretary at a price equal to the sum of--
(1) the face value of the coins;
(2) the surcharge provided in subsection (d) with respect
to such coins; and
(3) the cost of designing and issuing the coins (including
labor, materials, dies, use of machinery, overhead expenses,
marketing, and shipping).
(b) Bulk Sales.--The Secretary shall make bulk sales of the
coins issued under this Act at a reasonable discount.
(c) Prepaid Orders.--
(1) In general.--The Secretary shall accept prepaid orders
for the coins minted under this Act before the issuance of
such coins.
(2) Discount.--Sale prices with respect to prepaid orders
under paragraph (1) shall be at a reasonable discount.
(d) Surcharges.--All sales of coins issued under this Act
shall include a surcharge established by the Secretary, in an
amount equal to not more than--
(1) $50 per coin for the $10 coin or $35 per coin for the
$5 coin; and
(2) $10 per coin for the $1 coin.
SEC. 7. DISTRIBUTION OF SURCHARGES.
(a) In General.--Subject to section 5134(f) of title 31,
United States Code, the proceeds from the surcharges received
by the Secretary from the sale of coins issued under this Act
shall be paid promptly by the Secretary to the Department of
Health and Human Services to be used by the Secretary of
Health and Human Services for the purposes of--
(1) providing grants to charitable organizations that
assist families in their efforts to provide care at home to a
family member with Alzheimer's disease; and
(2) increasing awareness and educational outreach regarding
Alzheimer's disease.
(b) Audits.--Any organization or entity that receives funds
from the Secretary of Health and Human Services under
subsection (a) shall be subject to the audit requirements of
section 5134(f)(2) of title 31, United States Code, with
regard to such funds.
SEC. 8. FINANCIAL ASSURANCES.
(a) No Net Cost to the Government.--The Secretary shall
take such actions as may be necessary to ensure that minting
and issuing coins under this Act will not result in any net
cost to the United States Government.
(b) Payment for Coins.--A coin shall not be issued under
this Act unless the Secretary has received--
(1) full payment for the coin;
(2) security satisfactory to the Secretary to indemnify the
United States for full payment; or
(3) a guarantee of full payment satisfactory to the
Secretary from a depository institution, the deposits of
which are insured by the Federal Deposit Insurance
Corporation or the National Credit Union Administration
Board.
______
By Mr. LIEBERMAN (for himself, Ms. Collins, Mr. Levin, Mr. Durbin, and
Mr. Akaka):
S. 1144. A bill to amend title III of the Stewart B. McKinney
Homeless Assistance Act (42 U.S.C. 11331 ed seq.) to reauthorize the
Federal Emergency Management Food and Shelter Program, and for other
purposes; to the Committee on Governmental Affairs.
Mr. LIEBERMAN. Mr. President, I rise to introduce a bill that will
re-authorize a small but highly effective program, the Emergency Food
and Shelter Program, or EFS for short. The EFS program, which is
administered by the Federal Emergency Management Agency, supplements
community efforts to meet the needs of the homeless and hungry in all
fifty States. I am very pleased that my colleagues on the Committee on
Governmental Affairs, Senators Collins, Levin, Durbin, and Akaka, are
joining me as original co-sponsors of this legislation. Our committee
has jurisdiction over the EFS program, and it is my hope that together
we can generate even more bipartisan support for a program that makes a
real difference with its tiny budget. The EFS program is a great help
not only to the Nation's homeless population but also to working people
who are trying to feed and shelter their families at entry-level wages.
Services supplemented by the EFS funding, such as food banks and
emergency rent/utility assistance programs, are especially helpful to
families with big responsibilities but small paychecks.
One of the things that distinguishes the EFS program is the extent to
which it relies on non-profit organizations. Local boards in counties,
parishes, and municipalities across the country advertise the
availability of funds, decide on non-profit and local government
agencies to be funded, and monitor the recipient agencies. The local
boards, like the program's National Board, are made up of charitable
organizations including the National Council of Churches, the United
Jewish Communities, Catholic Charities, USA, the Salvation Army, and
the American Red Cross. By relying on community participation, the
program keeps administrative overhead to an unusually low amount, less
than 3 percent.
The EFS program has operated without authorization since 1994 but has
been sustained by annual appropriations. The proposed bill will re-
authorize the program for the next three years. It will also authorize
modest funding increases over the amounts appropriated in recent years.
A similar bill introduced by Senator Thompson and me in the last
Congress, S. 1516, passed the Senate by Unanimous Consent.
In summary, FEMA's Emergency Food and Shelter Program is a highly
efficient example of the government relying on the country's non-profit
organizations to help people in innovative ways. The EFS program aids
the homeless and the hungry in a majority of the Nation's counties and
in all fifty States, and I ask my colleagues to support this program
and our re-authorizing legislation.
I ask unanimous consent that the text of the bill be printed in the
Record.
[[Page S7201]]
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1144
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. AUTHORIZATION OF APPROPRIATIONS.
Section 322 of the Stewart B. McKinney Homeless Assistance
Act (42 U.S.C. 11352) is amended to read as follows:
``SEC. 322. AUTHORIZATION OF APPROPRIATIONS.
``There are authorized to be appropriated to carry out this
title $150,000,000 for fiscal year 2002, $160,000,000 for
fiscal year 2003, and $170,000,000 for fiscal year 2004.''.
SEC. 2. NAME CHANGE TO NOMINATING ORGANIZATION.
Section 301(b) of the Stewart B. McKinney Homeless
Assistance Act (42 U.S.C. 11331(b)) is amended by striking
paragraph (5) and inserting the following:
``(5) United Jewish Communities.''.
SEC. 3. PARTICIPATION OF HOMELESS INDIVIDUALS ON LOCAL
BOARDS.
Section 316(a) of the Stewart B. McKinney Homeless
Assistance Act (42 U.S.C. 11346(a)) is amended by striking
paragraph (6) and inserting the following:
``(6) guidelines requiring each local board to include in
their membership not less than 1 homeless individual, former
homeless individual, homeless advocate, or recipient of food
or shelter services, except that such guidelines may waive
such requirement for any board unable to meet such
requirement if the board otherwise consults with homeless
individuals, former homeless individuals, homeless advocates,
or recipients of food or shelter services.''.
______
By Mrs. BOXER:
S. 1145. A bill to amend the Internal Revenue Code of 1986 to extend
the work opportunity credit to encourage the hiring of certain
veterans, and for other purposes; to the Committee on Finance.
Mrs. BOXER. Mr. President, I am introducing legislation to help the
estimated 1.5 million veterans who are now living in poverty by giving
a tax credit to those employers who hire them and put them on the road
to financial independence. This idea was proposed and is supported by
the National Coalition for Homeless Veterans and the Non-Commissioned
Officers Association.
This legislation is based upon the current tax credit offered for
employers who hire those coming off welfare. Veterans groups tell me
that the current tax credit is underutilized by veterans because many
are not receiving food stamps or are not on welfare. Because the bill I
am introducing today bases eligibility on the poverty level, more
veterans will be able to benefit from this credit.
My bill would allow employers to receive a hiring tax credit of 50
percent of the veteran's first year wages and a retention credit of 25
percent of the veteran's second year wages. Only the first $20,000 of
wages per year will count toward the credit.
I offered this legislation as an amendment to the tax bill. While my
amendment failed on a procedural vote, 49-50, opponents indicated that
enacting this legislation would be a good thing to do. This being the
case, I am hopeful that the Senate will take up and pass the bill I am
introducing today in a bipartisan manner. It is the least we can do for
our veterans who so bravely served our Nation and deserve our help.
I ask unanimous consent that the text of this bill be printed in the
Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1145
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 ``Veterans Opportunity to Work
Act.''
SEC. 2. EXPANSION OF WORK OPPORTUNITY TAX CREDIT.
(a) In General.--Section 51(d)(1) of the Internal Revenue
Code of 1986 (relating to members of targeted groups) is
amended by striking ``or'' at the end of subparagraph (G), by
striking the period at the end of subparagraph (H) and
inserting ``, or'', and by adding at the end the following:
``(I) a qualified low-income veteran.''
(b) Qualified Low-Income Veteran.--Section 51(d) of the
Internal Revenue Code of 1986 (relating to members of
targeted groups) is amended by redesignating paragraphs (10)
through (12) as paragraphs (11) through (13), respectively,
and by inserting after paragraph (9) the following:
``(10) Qualified low-income veteran.--
``(A) In general.--The term `qualified low-income veteran'
means any veteran whose gross income for the taxable year
preceding the taxable year including the hiring date, was
below the poverty line (as defined by the Office of
Management and Budget) for such preceding taxable year.
``(B) Veteran.--The term `veteran' has the meaning given
such term by paragraph (3)(B).
``(C) Special rules for determining amount of credit.--For
purposes of applying this subpart to wages paid or incurred
to any qualified low-income veteran--
``(i) subsection (a) shall be applied by substituting `50
percent of the qualified first-year wages and 25 percent of
the qualified second-year wages' for `40 percent of the
qualified first year wages', and
``(ii) in lieu of paragraphs (2) and (3) of subsection (b),
the following definitions and special rule shall apply:
``(I) Qualified first-year wages.--The term `qualified
first-year wages' means, with respect to any individual,
qualified wages attributable to service rendered during the
1-year period beginning with the day the individual begins
work for the employer.
``(II) Qualified second-year wages.--The term `qualified
second-year wages' means, with respect to any individual,
qualified wages attributable to service rendered during the
1-year period beginning on the day after the last day of the
1-year period with respect to such individual determined
under subclause (I).
``(III) Only first $20,000 of wages per year taken into
account.--The amount of the qualified first and second year
wages which may be taken into account with respect to any
individual shall not exceed $20,000 per year.''.
(c) Permanence of Credit.--Section 51(c)(4) of the Internal
Revenue Code of 1986 (relating to termination) is amended by
inserting ``(except for wages paid to a qualified low-income
veteran)'' after ``individual''.
(d) Effective Date.--The amendments made by this section
shall apply to individuals who begin work for the employer
after the date of the enactment of this Act.
______
By Mr. ALLARD:
S. 1146. A bill to amend the Act of March 3, 1875, to permit the
State of Colorado to use land held in trust by the State as open space;
to the Committee on Energy and Natural Resources.
Mr. ALLARD. Mr. President, today I am introducing legislation to
fulfill the wishes of my fellow Coloradans to allow the State to
protect 300,000 acres of State land as open space.
The origins of this issue date back to 1875 when Congress passed the
legislation which authorized the Territory of Colorado to form a
constitution, State government and be admitted into the Union. The 1875
Enabling Act established that Sections 16 and 36 of each township in
the new State would be ``granted to said State for the support of
common schools.'' The Federal directive to the State was clear: provide
a sound financial basis for the long-term benefit of public schools.
The Colorado State Constitution further strengthened this position and
required that the new State Board of Land Commissioners manage its land
holdings ``in such a matter as will secure the maximum possible
amount'' for the public school fund.
Today, there are some three million surface acres of State trust
lands which are leased for ranching, farming, oil and gas production
and other uses. Some of these lands are the most beautiful parcels in
the state and offer a tremendous natural resource.
Through the years, the lands have been a reliable, but a dwindling
source of funds to the overall education budget. Currently, the State
of Colorado spends approximately $3.5 billion annually on public
schools, of this amount revenues from State trust lands account for
about $22 million.
Now, however, Coloradans priorities have changed, including a strong
desire to protect open space and the environment. These changes became
evident in a 1996 voter approved State Constitutional Amendment which
gave more flexibility in the management of the trust lands. Among other
things, the Amendment established a 300,000 acre Stewardship Trust. The
voters recognized that certain State trust lands may be more valuable
in the future if they are kept in the trust land portfolio rather than
disposed of for a short term financial gains. The lands in the new
Stewardship Trust will be managed ``to maximize options for continued
stewardship, public use or future disposition'' by protecting and
enhancing the ``beauty, natural values, open space and wildlife
habitat'' on these parcels. Further, it struck the provision requiring
``maximizing revenue'' and replaced it with a requirement that the land
board to manage its land holdings ``in order to produce reasonable and
consistent income over time.''
[[Page S7202]]
While the Amendment has withstood court challenges, it still remains
that the Stewardship Trust could, in the future, cause a breach of the
Enabling Act. In order to correct this potential breach, I am
introducing this legislation with the full support of the State of
Colorado to ensure that the wishes of the voters are upheld and the
Stewardship Trust is fully implemented. There are two key points of the
legislation. First, the bill allows 300,000 acres of state trust lands
to be used for open space, wildlife habitat, scenic value or other
natural value. Second, it exempts these lands from the requirement that
they generate income for the common schools.
The Colorado State Land Board has a clear mission for implementing
the Stewardship Trust: to protect the crown jewels of the state trust
lands and ensure that these lands receive special protection from sale
or development.
It is also clear that Colorado voters wanted to set aside 300,000
acres from potential development. I want to help the State fulfill
these goals.
This is a unique bill and ensures the state's flexibility in managing
the trust lands. It does not change the intent of the Stewardship
Trust, just ensures that the Enabling Act and the State Constitution
are consistent.
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. 1146
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. COLORADO TRUST LAND.
Section 7 of the Act of March 3, 1875 (18 Stat. 475,
chapter 139) (commonly known as the ``Colorado Enabling
Act''), is amended by inserting before the period at the end
the following: ``and for use for open space, wildlife
habitat, scenic value, or other natural value, regardless of
whether the land generates income for the common schools as
described under section 14, except that the amount of land
used for natural value shall not exceed 300,000 acres''.
______
By Mr. NICKLES:
S. 1147. A bill to amend title X and title XI of the Energy Policy
Act of 1992; to the Committee on Energy and Natural Resources.
Mr. NICKLES. Mr. President, I rise today to introduce legislation,
the Thorium Remediation Reauthorization Act of 2001. This bill will
provide authorization for the Federal Government to pay its share of
decommissioning and remediation costs for a thorium facility in West
Chicago, Illinois. In a DOE proceeding, it was determined that the
government is responsible for 55.2 percent of all West Chicago cleanup
costs because 55.2 percent of West Chicago tailings resulted from
Federal contracts. Under Title X of the Energy Policy Act of 1992
(``EPACT''), the thorium licensee pays for all West Chicago cleanup
costs, and is then reimbursed, though annual appropriations, the
government's share of those costs.
There is already more than a $60 million shortage in authorized
funding for the Federal share of West Chicago cleanup costs. Despite
that, the thorium licensee has continued to pay all decommissioning
costs at the West Chicago factory site, as well as remediation costs at
vicinity properties known as Reed-Keppler Park, Residential Properties,
and Kress Creek. Remediation of Reed-Keppler Park was finished late
last year and remediation of more than 600 Residential Properties is
expected to be substantially complete by the end of this year.
Decommissioning of the factory site, with the exception of groundwater,
is expected to conclude in 2004. Cleanup requirements at Kress Creek
have not been determined, and until those are established, the costs
associated with the cleanup of that vicinity property cannot be
accurately projected.
The significant costs associated with the West Chicago cleanup are a
result, in large part, of extensive government use of the facility
during the development of our country's nuclear defense program,
including the Manhattan project. With the exception of Kress Creek and
groundwater, total cleanup costs at the factory site and all vicinity
properties can now be estimated with reasonable certainty. The $123
million authorized by this bill will permit the government to begin
reimbursing the amount it is already in arrears to the thorium
licensee. It also will provide the authorization necessary for the
government to pay its share of costs, excluding costs for Kress Creek
and for groundwater, that will be incurred by the licensee through
completion of West Chicago cleanup.
Funding for this reauthorization would come from the General
Treasury. Thus, this legislation will not diminish the availability of
funds in the DOE's Decontamination and Decommissioning Fund, from which
both Title X uranium licensees and the DOE's gaseous diffusion plants
receive funding.
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. 1147
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. REAUTHORIZATION OF THORIUM REIMBURSEMENT.
(a) Section 1001(b)(2)(C) of the Energy Policy Act of 1992
(42 U.S.C. 2296a) is amended by striking ``$140,000,000'' and
inserting ``$263,000,000''.
(b) Section 1003(a) of such Act (42 U.S.C. 2296a-2) is
amended by striking ``$490,000,000'' and inserting
``$613,000,000''.
(c) Section 1802(a) of the Atomic Energy Act of 1954 (42
U.S.C. 2297g-1) is amended by striking ``$488,333,333'' and
inserting ``$508,833,333''.
______
By Mr. BURNS:
S. 1148. A bill to convey the Lower Yellowstone Irrigation Project,
the Savage Unit of the Pick-Sloan Missouri Basin Program, and the
Intake Irrigation Project to the appurtenant irrigation districts; to
the Committee on Energy and Natural Resources.
Mr. BURNS. Mr. President, I rise today to introduce a piece of
legislation that helps a large number of family farmers on the border
of Montana and North Dakota. The Lower Yellowstone Irrigation Projects
Title Transfer moves ownership of these irrigation projects from
Federal control to local control. Both the Bureau of Reclamation and
those relying on the projects for their livelihood agree there is
little value in having the Federal Government retain ownership.
I introduced this legislation in the last Congress, and continue to
believe it helps us to achieve the long term goals of Montana
irrigators, and the mission of the Bureau of Reclamation. Just this
week I attended the confirmation hearing of John W. Keys, III, who is
the designate for Commissioner of the Bureau of Reclamation. I asked
his position on title transfers of irrigation projects like the Lower
Yellowstone, where local irrigation districts have successfully managed
the Federal properties, and where the Bureau has encouraged the
transfer of title to the Districts. His response to me was very
encouraging. He stated this type of title transfer ``makes sense and is
an opportunity to move facilities from Federal ownership to more
appropriate control.'' He has promised to work with me and the
Irrigation District to make this a reality, and I look forward to it.
The history of these projects dates to the early 1900's with the
original Lower Yellowstone project being built by the Bureau of
Reclamation between 1906 and 1910. The Savage Unit was added in 1947-
48. The end result was the creation of fertile, irrigated land to help
spur economic development in the area. To this day, agriculture is the
number one industry in the area.
The local impact of the projects is measurable in numbers, but the
greatest impacts can only be seen by visiting the area. About 500
family farms rely on these projects for economic substance, and the
entire area relies on them to create stability in the local economy. In
an area that has seen booms and busts in oil, gas, and other
commodities, these irrigated lands continued producing and offering a
foundation for the businesses in the area.
As we all know, the agricultural economy is not as strong as we'd
like it to be, but these irrigated lands offer a reasonable return over
time and are the foundation for strong communities based upon the
ideals that have made this country successful. The 500 families
impacted are hard working, honest producers, and I can think of no
better people to manage their own irrigation projects.
[[Page S7203]]
Every day, we see an example of where the Federal Government is
taking on a new task. We can debate the merits of these efforts on an
individual basis, but I think we can all agree that while the
government gets involved in new projects there are many that we can
safely pass on to state or local control. The Lower Yellowstone
Projects are a prime example of such an opportunity, and I ask my
colleagues to join me in seeing this legislation passed as quickly as
possible.
______
By Mr. SMITH of New Hampshire:
S. 1150. A bill to waive tolls on the Interstate System during peak
holiday travel periods; to the Committee on Environment and Public
Works.
Mr. SMITH of New Hampshire. Mr. President, I rise to introduce the
Interstate Highway System Toll-Free Holiday Act.
As we move into this Fourth of July holiday to celebrate our nation's
225th birthday, many will do so in true American fashion by loading up
the kids and the dog in the family car and heading out for a fun
holiday vacation. Unfortunately, many of those family trips will
quickly turn into frustration. Just as you get on the road and begin
that family outing, you are greeted by a screeching halt, faced with
what seems to be an endless line that is not moving. Soon, the kids
will grow restless and angry. You've just reached the end of the line
of the first toll booth and the delay and frustration begins. Of
course, when you do finally make it to the booth, they take your money.
Every holiday, no exception. I want to help make those holiday driving
vacations more enjoyable by removing that toll booth frustration. My
legislation will provide the much deserved relief from all of that
holiday grief.
The Interstate Highway System Toll-Free Holiday Act provides that no
tolls will be collected and no vehicles will be stopped at toll booths
on the Interstate System during peak holiday travel periods. The exact
duration of the toll waivers will be left to the States to determine,
but will include, at a minimum, the entire 24 hour period of each legal
Federal holiday. The bill will also authorize the Secretary of
Transportation to reimburse the State, at the State's request, for lost
toll revenues out of the Highway Trust Fund, which is funded by the tax
that we all pay when we purchase gas for our cars. I want to keep the
State highway funds whole, and, at the same time, provide relief to all
those who simply want a hassle-free holiday trip.
There are currently some 2,200 miles of toll facilities on the 42,800
mile Interstate System. On peak holiday travel days, traffic increases
up to 50 percent over a typical weekday. In New Hampshire last year,
the I-95 Hampton toll booth had a 10 percent average increase in
traffic over the four-day Fourth of July weekend compared to the
previous weekend. That is equivalent to an additional 8,000 vehicles
passing through this one toll booth every day. That increase in volume
at the toll sites is not only an inconvenience in time and money, but
also adds to safety concerns and, because vehicle emissions are higher
when idling, air quality suffers. I am pleased that this bill will
alleviate the headaches and problems associated with increased toll
booth traffic on holidays.
This is just one of what will be a series of bills that I will be
introducing, as the Ranking Member of the Environment and Public Works
Committee, to address transportation needs in New Hampshire and across
the Nation, as we prepare for the reauthorization of the next major
comprehensive highway bill in 2003.
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. 1150
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 ``Interstate Highway System
Toll-Free Holiday Act''.
SEC. 2. WAIVER OF TOLLS ON THE INTERSTATE SYSTEM DURING PEAK
HOLIDAY TRAVEL PERIODS.
(a) Definitions.--In this section, the terms ``Interstate
System'', ``public authority'', ``Secretary'', ``State'', and
``State transportation department'' have the meanings given
the terms in section 101(a) of title 23, United States Code.
(b) Waiver.--
(1) In general.--No tolls shall be collected, and no
vehicle shall be required to stop at a toll booth, for any
toll highway, bridge, or tunnel on the Interstate System
during any peak holiday travel period determined under
paragraph (2).
(2) Peak holiday travel periods.--For the purposes of
paragraph (1), the State transportation department or the
public authority having jurisdiction over the toll highway,
bridge, or tunnel shall determine the number and duration of
peak holiday travel periods, which shall include, at a
minimum, the 24-hour period of each legal public holiday
specified in section 6103(a) of title 5, United States Code.
(c) Federal Reimbursement.--
(1) In general.--For each fiscal year, upon request by a
State or public authority and approval by the Secretary, the
Secretary shall reimburse the State or public authority for
the amount of toll revenue not collected by reason of
subsection (b).
(2) Requests for reimbursement.--On or before September 30
of a fiscal year, each State or public authority that desires
a refund described in paragraph (1) shall submit to the
Secretary a request for reimbursement, based on actual
traffic data, for the amount of toll revenue not collected by
reason of subsection (b) during the fiscal year.
(3) Use of reimbursed funds.--A request for reimbursement
under paragraph (2) shall include a certification by the
State or public authority that the amount of the
reimbursement will be used only for debt service or for
operation and maintenance of the toll facility, including
reconstruction, resurfacing, restoration, and rehabilitation.
(4) Authorization of appropriations.--There are authorized
to be appropriated from the Highway Trust Fund (other than
the Mass Transit Account) such sums as are necessary to carry
out this subsection.
______
By Mr. REID (for himself and Mr. Ensign):
S. 1151. A bill to amend the method for achieving quiet technology
specified in the National Parks Air Tour Management Act of 2000; to the
Committee on Commerce, Science, and Transportation.
Mr. REID. Mr. President, I rise today along with my good friend and
colleague from Nevada, Senator Ensign because I am deeply concerned
that the Federal Aviation Administration has failed to develop the
incentives for quiet technology aircraft.
The bill we are introducing today, the ``Grand Canyon Quiet
Technology Implementation Act,'' completes the Congressional mandates
contained in the National Park Air Tour Management Act of 2000 which
called for the implementation of ``reasonably achievable'' quiet
technology standards for the Grand Canyon air tour operators.
Key provisions of the Act called for the Federal Aviation
Administration, by April 5th of this year, to: 1. Designate reasonably
achievable requirements for fixed-wing and helicopter aircraft
necessary for such aircraft to be considered as employing quiet
aircraft technology; and 2. establish corridors for commercial air tour
operations by fixed-wing and helicopter aircraft that employ quiet
aircraft technology, or explain to Congress why they can't. The agency
has failed to comply with any of these provisions.
The Act also provides that operators employing quiet technology shall
be exempted from operational flight caps. This relief is essential to
the very survival of many of these air tour companies. By not complying
with these Congressional mandates, the Federal Aviation Administration
places the viability of the Grand Canyon air tour industry in jeopardy.
While Senator Ensign and I along with the air tour community have
sought to work with the Federal agencies in a cooperative manner, our
repeated overtures have been summarily ignored, which forces us to take
further legislative action.
Our bill simply requires the Federal Aviation Administration to do
its job. It identifies ``reasonably achievable'' quiet technology
standards and provides relief for air tour operators who have spent
many years and millions of dollars of their money voluntarily
transitioning to quieter aircraft to help restore natural quiet to the
Grand Canyon.
I would like to compliment my good friend from Arizona, Senator John
McCain for his vision and leadership in the Senate in recognizing that
quieter aircraft was the key to restoring natural quiet to the Grand
Canyon. During his tenure as chairman of the Senate Commerce Committee,
it was Senator McCain who insisted on the quiet technology provisions
contained in the National Park Air Tour Management Act
[[Page S7204]]
of 2000. It was Senator McCain who wanted to ensure that those air tour
companies which already have made huge investments in current
technology quiet aircraft modifications were rewarded for their
initiative. It was Senator McCain, an advocate for restoring natural
quiet to the Grand Canyon, who took the lead in seeking to ensure that
the elderly, disabled and time-constrained visitor still would be able
to enjoy the magnificence of the Grand Canyon by air. The legislation
we are introducing today, supports Senator McCain's vision.
The National Park Air Tour Management Act of 2000 is clear. It calls
for the implementation of ``reasonably achievable'' quiet technology
incentives. Our Grand Canyon Quiet Technology Implementation
legislation is based on today's best aircraft technology.
Some may ask what is ``reasonably achievable?'' It constitutes the
following: replacing smaller aircraft with larger and quieter aircraft
with more seating capacity reducing the number of flights needed to
carry the same number of passengers; adding propellers on turbine-
powered airplanes or main rotor blades on helicopters which reduces
prop tip speeds by reducing engine RPMs; modifying engine exhaust
systems with high-tech mufflers to absorb engine noise; modifying
helicopter tail rotors with high-tech components for quieter operation.
These modifications typically reduce the sound generated by these
aircraft by more than 50 percent.
This is what is ``reasonably achievable'' in aviation technology. In
the year 2001, this is essentially all that can be done to make
aircraft quieter. Operators which have spent millions of dollars to
make these modifications, in our view, have complied with the intent of
the law and deserve relief.
Let us not forget the original intent of this legislation to help
restore natural quiet to the Grand Canyon and, as the 1916 Organic Act
directs, to provide for the enjoyment of our national parks ``in such
manner and by such means as will leave them unimpaired for the
enjoyment of future generations.''
Air touring is consistent with the Park Service mission.
Based on current air tour restrictions, more than 1.7 million
tourists will be denied access to the Grand Canyon during the next
decade at a cost to air tour operators conservatively estimated at $250
million.
Senator Ensign and I agree that, to the extent possible and
practical, that the quieter these air tour aircraft can be made to be,
the better for everyone. That's why it is so important that the Grand
Canyon Quiet Technology Implementation Act become the law.
I ask unanimous consent that the text of the Grand Canyon Quiet
Technology Implementation Act be printed in the Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1151
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 referred to as the ``Grand Canyon Quiet
Technology Implementation Act''.
SEC. 2. AMENDMENTS TO QUIET AIRCRAFT TECHNOLOGY.
(a) In General.--Section 804 of the National Parks Air Tour
Management Act of 2000 (49 U.S.C. 40128 note) is amended by
adding at the end the following new subsection:
``(f) Alternative Quiet Aircraft Technology.--
``(1) General rule.--Notwithstanding any other provision of
law, an air tour operator based in Clark County, Nevada or at
the Grand Canyon National Park Airport shall be treated as
having met the requirements for quiet aircraft technology
that apply with respect to commercial air tour operations for
tours described in subsection (b), if the air tour operator
has met the following requirements:
``(A) The aircraft used by the air tour operator for such
tours--
``(i) meet the requirements designated under subsection
(a); or
``(ii) if not previously powered by turbine engines, have
been modified to be powered by turbine engines and, after the
conversion--
``(I) have a higher number of propellers (in the case of
fixed-wing aircraft) or main rotor blades (in the case of
helicopters) than the aircraft had before the conversion,
thereby resulting in a reduction in prop or blade tip speeds
and engine revolutions per minute;
``(II) have current technology engine exhaust mufflers;
``(III) in the case of helicopters, have current technology
quieter tail rotors; or
``(IV) have any other modifications, approved by the
Federal Aviation Administration, that significantly reduce
the aircraft's sound.
``(B) The air tour operator has replaced, for use for the
tours, smaller aircraft with larger aircraft that have more
seating capacity, thereby reducing the number of flights
needed to transport the same number of passengers.
``(C) The air tour operator can safely demonstrate, through
flight testing administered by the Federal Aviation
Administration that applies a sound measurement methodology
accepted as standard, that the tour operator can fly existing
aircraft in a manner that achieves a sound signature in the
same noise range or having the same or similar sound effect
as the aircraft that satisfy the requirements of subparagraph
(A) or (B).
``(2) Exemption from flight caps.--Any air tour operator
that meets the requirements described in paragraph (1), shall
be--
``(A) exempt from the operational flight allocations
referred to in subsection (c) and from flight curfews and any
other requirement not imposed solely for reasons of aviation
safety; and
``(B) granted air tour routes that are preferred for the
quality of the scenic views for--
``(i) tours from Clark County, Nevada to the Grand Canyon
National Park Airport; and
``(ii) `local loop' tours referred to in subsection
(b)(2).''.
(b) Reinstatement of Certain Air Tour Routes.--Any air tour
route from Clark County, Nevada, to the Grand Canyon National
Park Airport, Tusayan, Arizona, that was eliminated, or
altered in any way, by regulation or by action by the Federal
Aviation Administration, on or after January 1, 2001, and
before the date of enactment of this Act shall be reinstated
effective as of such date of enactment and no further
changes, modifications, or elimination of any other air tour
route flown by an air tour company based in Clark County,
Nevada or at the Grand Canyon National Park Airport, Tusayan,
Arizona may be made after such date of enactment without the
approval of Congress.
______
By Mr. CRAIG (for himself and Mrs. Feinstein):
S. 1153. A bill to amend the Food Security Act of 1985 to establish a
grassland reserve program to assist owners in restoring and protecting
grassland; to the Committee on Agriculture, Nutrition, and Forestry.
Mr. CRAIG. Mr. President, I rise today to introduce the ``Grassland
Reserve Act'', a bill to authorize a voluntary program to purchase
permanent or 30 year easement from willing producers in exchange for
protection of ranches, grasslands, and lands of high resource value. I
am pleased that Senators Feingold, and Thomas, have joined as original
cosponsors.
Grasslands provided critical habitat for complex plant and animal
communities throughout much of North America. However, many of these
lands have been, and are under pressure to be, converted to other uses,
threatening and eliminating plant and animal communities unique to this
continent. A significant portion of the remaining grasslands occur on
working ranches. Ranchland provides important open-space buffers for
animal and plant habitat. Moreover, ranching forms the economic
backbone for much of rural western United States. Loss of this economic
activity will invariably lead to the loss of the open space that is
indispensable for plant and animal communities and for citizens who
love the western style of life.
As a rancher from a rural community in Idaho, I have noticed the
changes taking place in some parts of my State where, for a number of
reasons, working ranchers have been sold into ranchetts leaving the
landscape divided by fences and homes where cattle and wildlife once
roamed. Currently, no Federal programs exist to conserve grasslands,
ranches, and other lands of high resource values, other than wetlands,
on a national scale. I believe the United States needs a voluntary
program to conserve these lands, and the Grasslands Reserve Act does
just that.
Specifically, this bill establishes the Grasslands Reserve program
through the Natural Resources Conservation Service to assist owners in
restoring and conserving eligible land. To be eligible to participate
in the program an owner must enroll 100 contiguous acres of land west
of the 90th meridian or 50 contiguous acres of land east of the 90th
meridian. A maximum of 1,000,000 acres may be enrolled in the program
in the form of a permanent or a 30-year easement. Land eligible for the
program includes: native grasslands,
[[Page S7205]]
working ranches, other areas that contain animal or plant populations
of significant ecological value, and land that is necessary for the
efficient administration of the easement.
The terms of the easements allow for grazing in a manner consistent
with maintaining the viability of native grass species. All uses other
than grazing, such as hay production, may be implemented according to
the terms of a written agreement between the landowner and easement
holder. Easements prohibit the production of row crops, and other
activities that disturb the surface of the land covered by the
easement. The Secretary will work with the State technical committees
to establish criteria to evaluate and rank applications for easements
which will emphasize support for grazing operations, plant and animal
biodiversity, and native grass and shrubland under the greatest threat
of conversion. The Secretary may prescribe terms to the easement
outlining how the land shall be restored including duties of the land
owner and the Secretary. If the easement is violated, the Secretary may
require the owner to refund all or part of the payments including
interest. The Secretary may also conduct periodic inspections, after
providing notice to the owner, to determine that the landowner is in
compliance with the terms of the easement. The easement may be held and
enforced by a private conservation, land trust organization, or a State
agency in lieu of the Secretary, if the Secretary determines that
granting such permission will promote grassland protection and the
landowner agrees.
This legislation requires the Secretary to make payments for
permanent easements based on the fair market value of the land less the
grazing value of the land encumbered by the easement, and for 30 year
easements the payment will be 30 percent of the fair market value of
the land less the grazing value of the land encumbered by the easement.
Payments may be made in one lump sum or over a 10 year period.
Landowners may also choose to enroll their land in a 30-year rental
agreement instead of a 30-year easement where the Secretary would make
thirty annual payments which approximate the value of a lump sum
payment the owner would receive under a 30-year easement. The Secretary
is required to assess the payment schedule every five years to make
sure that the payments do approximate the value of a 30-year easement.
USDA is also required to cover up to 75 percent of the cost of
restoration and provide owners with technical assistance to execute the
easement and restore the land.
I believe this legislation fills a need we have in our agriculture
policy and I look forward to working with other members to include the
Grasslands Reserve program in a responsible and balanced farm bill.
Mrs. FEINSTEIN. Mr. President, today I am pleased to join my
colleague from Idaho to introduce legislation that provides fair
compensation to producers and other landowners who maintain open spaces
for plants and animals to thrive.
This bill creates a voluntary program authorizing the United States
Department of Agriculture, USDA, to obtain either 30-year or permanent
easements from landowners in exchange for a cash payment. Easements
allow for grazing while maintaining the viability of native grass
species. Moreover, these uses must only occur upon the conclusion of
the local bird nesting season.
Vast amounts of grassland are being lost to urban development every
year in large part because of economic pressures faced by ranchers,
livestock producers, and other grassland owners.
Currently, there are no long-term programs to protect grasslands on a
national scale. The Grassland Reserve Act provides real options to
financially-strapped land owners of grasslands who wish to keep their
lands in a natural state. There is a need for this bill because
existing programs to protect lands, such as the Forest Legacy program,
target forested lands only.
This legislation represents a win-win situation for both the
environment and people who make their livelihood on grasslands. The
loss of grassland is a serious problem for preserving wildlife habitat
and a rural way of life. This bill is a step in the right direction to
protect these lands from future development.
I have always felt that protecting our Nation's unique natural areas,
including grasslands, should be one of our highest priorities. I invite
my colleagues to join Senator Craig and me in supporting this
legislation.
______
By Mr. LEVIN (for himself and Mr. Warner) (by request):
S. 1155. A bill to authorize appropriations for fiscal year 2002 for
military activities of the Department of Defense, to prescribe military
personnel strengths for fiscal year 2002, and for other purposes; to
the Committee on Armed Services.
Mr. LEVIN. Mr. President, I ask unanimous consent that the text of
the President's request for Defense and the text of the bill be printed
in the Record, including the section-by-section analysis.
There being no objection, the material was ordered to be printed in
the Record, as follows:
S. 1155
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 ``National Defense
Authorization Act for Fiscal Year 2002''.
SEC. 2. TABLE OF CONTENTS.
The table of contents for this Act is as follows:
Sec. 1. Table of contents.
TITLE I--PROCUREMENT
Authorization of Appropriations
Sec. 101. Army.
Sec. 102. Navy and Marine Corps.
Sec. 103. Air Force.
Sec. 104. Defense-Wide Activities.
Sec. 105. Defense Inspector General.
Sec. 106. Defense Health Program.
TITLE II-RESEARCH, DEVELOPMENT, TEST, AND EVALUATION
Sec. 201. Authorization of Appropriations.
TITLE III--OPERATION AND MAINTENANCE
Subtitle A--Authorization of Appropriations
Sec. 301. Operation and Maintenance Funding.
Sec. 302. Working Capital Funds.
Sec. 303. Armed Forces Retirement Home.
Sec. 304. Acquisition of Logistical Support for Security Forces.
Sec. 305. Contract Authority for Defense Working Capital Funds.
Subtitle B--Environmental Provisions
Sec. 310. Reimburse EPA for Certain Costs in Connection with Hooper
Sands Site, in South Berwick, Maine.
Sec. 311. Extension of Pilot Program for the Sale of Air Pollution
Emission Reduction Incentives.
Sec. 312. Elimination of Report on Contractor Reimbursement Costs.
Subtitle C--Commissaries and Nonappropriated Fund Instrumentalities
Sec. 315. Costs Payable to the Department of Defense and Other Federal
Agencies for Services Provided to the Defense Commissary
Agency.
Sec. 316. Reimbursement for Non-Commissary Use of Commissary
Facilities.
Sec. 317. Commissary Contracts and Other Agencies and
Instrumentalities.
Sec. 318. Operation of Commissary Stores.
Subtitle D--Other Matters
Sec. 320. Reimbursement, for Reserve Intelligence Support.
Sec. 321. Disposal of Obsolete and Excess Materials Contained in the
National Defense Stockpile.
TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS
Subtitle A--Active Forces
Sec. 401. End Strengths for Active Forces.
Subtitle B--Reserve Forces
Sec. 405. End Strengths for Selected Reserve.
Sec. 406. End Strengths for Reserves on Active Duty in Support of the
Reserves.
Sec. 407. End Strengths for Military Technicians (Dual Status).
Sec. 408. Fiscal Year 2002 Limitation on Number of Non-Dual Status
Technicians.
Sec. 409. Authorized Strengths: Reserve Officers and Senior Enlisted
Members on Active Duty or Full-time National Guard Duty
for Administration of the Reserves or National Guard.
Sec. 410. Increase in Authorized Strengths for Air Force Officers on
Active Duty in the Grade of Major.
TITLE V--MILITARY PERSONNEL POLICY
Subtitle A--Officer Personnel Policy
Sec. 501. Elimination of Certain Medical and Dental Requirements for
Army Early-Deployers.
Sec. 502. Medical Deferment of Mandatory Retirement or Separation.
Sec. 503. Officer in Charge; United States Navy Band.
Sec. 504. Removal of Requirement for Certification for Certain Flag
Officers to Retire in Their Highest Grade.
[[Page S7206]]
Sec. 505. Three-Year Extension of Certain Force Drawdown Transition
Authorities Relating to Personnel Management and
Benefits.
Sec. 506. Judicial Review of Selection Boards.
Subtitle B--Reserve Component Personnel Policy
See. 511. Retirement of Reserve Personnel.
Sec. 512. Amendment to Reserve PERS- TEMPO Definition.
See. 513. Individual Ready Reserve Physical Examination Requirement.
Sec. 514. Benefits and Protections for Members in a Funeral Honors Duty
Status.
Sec. 515. Funeral Honors Duty Performed by Members of the National
Guard.
Sec. 516. Strength and Grade Ceiling Accounting for Reserve Component
Members on Active Duty in Support of a Contingency
Operation.
Sec. 517. Reserve Health Professionals Stipend Program Expansion.
Sec. 518. Reserve Officers on Active Duty for a Period of Three Years
or Less.
Sec. 519. Active Duty End Strength Exemption for National Guard and
Reserve Personnel Performing Funeral Honors Functions,
See. 520. Clarification of Functions That May Be Assigned to Active
Guard and Reserve Personnel on Full-Time National Guard
Duty.
See. 521. Authority for Temporary Waiver of the Requirement for a
Baccalaureate Degree for Promotion of Certain Reserve
Officers of the Army.
Sec. 522. Authority of the President to Suspend Certain Laws Relating
to Promotion, Retirement and Separation; Duties.
Subtitle C--Education and Training
Sec. 531. Authority for the Marine Corps University to Award the Degree
of Master of Strategic Studies.
Sec. 532. Reserve Component Distributed Learning.
Sec. 533. Repeal of Limitation on Number of Junior Reserve Officers'
Training Corps (JROTC) Units.
Sec. 534. Modification of the Nurse Officer Candidate Accession Program
Restriction on Students Attending Civilian Educational
Institutions with Senior Reserve Officers' Training
Programs.
Sec. 535. Defense Language Institute Foreign Language Center.
Subtitle D--Decorations, Awards, and Commendations
Sec. 541. Authority for Award of the Medal of Honor to Humbert R.
Versace for Valor During the Vietnam War.
Sec. 542. Issuance of Duplicate Medal of Honor.
Sec. 543. Repeal of Limitation on Award of Bronze Star to Members in
Receipt of Special Pay.
Subtitle E--Uniform Code of Military Justice
Sec. 551. Revision of Punitive UCMJ Article Regarding Drunken Operation
of Vehicle, Aircraft, or Vessel.
TITLE VI--COMPENSATION AND OTHER PERSONNEL BENEFITS
Subtitle A--Pay and Allowances
Sec. 601. Increase in basic pay for fiscal year 2002.
Sec. 602. Partial Dislocation Allowance Authorized Under Certain
Circumstances.
Sec. 603. Funeral Honors Duty Allowance for Retirees.
Sec. 604. Basic Pay Rate for Certain Reserve Commissioned Officers with
Prior Service as an Enlisted Member or Warrant Officer.
Sec. 605. Family Separation Allowance.
Sec. 606. Housing Allowance for the Chaplain for the Corps of Cadets,
United States Military Academy.
Sec. 607. Clarifying Amendment that Space-Required Travel for Annual
Training Reserve Duty Does Not Obviate Transportation
Allowances.
Subtitle B--Bonuses and Special and Incentive Pays
Sec. 611. Authorize the Secretary of the Navy to Prescribe Submarine
Duty Incentive Pay Rates.
Sec. 612. Extension of Authorities Relating to Payment of Other Bonuses
and Special Pays.
Sec. 613. Extension of Certain Bonuses and Special Pay Authorities for
Nurse Officer Candidates, Registered Nurses, Nurse
Anesthetists, and Dental Officers.
Sec. 614. Extension of Authorities Relating to Nuclear Officer Special
Pays.
See. 615. Extension of Special and Incentive Pays.
Sec. 616. Accession Bonus for Officers in Critical Skills.
Sec. 617. Critical Wartime Skill Requirement for Eligibility for the
Individual Ready Reserve Bonus.
Sec. 618. Hazardous Duty Incentive Pay: Maritime Board and Search.
Subtitle C--Travel and Transportation Allowances
Sec. 621. Funded Student Travel: Exchange Programs.
Sec. 622. Payment of Vehicle Storage Costs in Advance.
Sec. 623. Travel and Transportation Allowances for Family Members to
Attend the Burial of a Deceased Member of the Armed
Forces.
Sec. 624. Shipment of Privately Owned Vehicles When Executing CONUS
Permanent Change of Station Moves.
Subtitle D--Other
See. 631. Montgomery G I Bill--Selected Reserve Eligibility Period.
Sec. 632. Improved Disability Benefits for Certain Reserve Component
Members.
Sec. 633. Acceptance of Scholarships by Officers Participating in the
Funded Legal Education Program.
TITLE VII--ACQUISITION POLICY AND ACQUISITION MANAGEMENT
Subtitle A--Acquisition Policy
Sec. 701. Acquisition Milestone Changes.
Sec. 702. Clarification of Inapplicability of the Requirement for Core
Logistics Capabilities Standards to the Nuclear Refueling
of an Aircraft Carrier.
Sec. 703. Depot Maintenance Utilization Waiver.
Subtitle B--Acquisition Workforce
Sec. 705. Acquisition Workforce Qualifications.
See. 706. Tenure Requirement for Critical Acquisition Positions.
Subtitle C--General Contracting Procedures and Limitations
Sec. 710. Amendment of Law Applicable to Contracts for Architectural
and Engineering Services and Construction Design.
Sec. 711. Streamlining Procedures for the Purchase of Certain Goods.
Sec. 712. Repeal of the Requirement for the Limitations on the Use of
Air Force Civil Engineering Supply Function Contracts.
Sec. 713. One-Year Extension of Commercial Items Test Program.
Sec. 714. Modification of Limitation on Retirement or Dismantlement of
Strategic Nuclear Delivery Systems.
Subtitle D--Military Construction General Provisions
Sec. 715. Exclusion of Unforeseen Environmental Hazard Remediation from
the Limitation on Cost Increases for Military
Construction and Family Housing Construction Projects.
Sec. 716. Increase of Overseas Minor Construction Threshold Using
Operations and Maintenance Funds.
Sec. 717. Leasebacks of Base Closure Property.
Sec. 718. Alternative Authority For Acquisition and Improvement of
Military Housing.
Sec. 719. Annual Report to Congress on Design And Construction.
TITLE VIII--DEPARTMENT OF DEFENSE ORGANIZATION AND MANAGEMENT
Subtitle A--Department of Defense Organizations and Positions
Sec. 801. Organizational Alignment Change for Director for
Expeditionary Warfare.
Sec. 802. Consolidation of Authorities Relating to Department of
Defense Regional Centers for Security Studies.
Sec. 803. Change of Name for Air Mobility Command.
See. 804. Transfer of Intelligence Positions in Support of the National
Imagery and Mapping Agency.
Subtitle B--Reports
Sec. 811. Amendment to National Guard and Reserve Component Equipment:
Annual Report to Congress.
Sec. 812. Elimination of Triennial Report on the Roles and Missions of
the Armed Forces.
Sec. 813. Change in Due Date of Commercial Activities Report.
Subtitle C--Other Matters
Sec. 821. Documents, Historical Artifacts, and Obsolete or Surplus
Materiel: Loan, Donation, or Exchange.
See. 822. Charter Air Transportation of Members of the Armed Forces.
TITLE IX--GENERAL PROVISIONS
Subtitle A--Matters Relating to Other Nations
Sec. 901. Test and Evaluation Initiatives.
Sec. 902. Cooperative Research and Development Projects: Allied
Countries.
Sec. 903. Recognition of Assistance from Foreign Nationals.
Sec. 904. Personal Service Contracts in Foreign Areas.
[[Page S7207]]
Subtitle B--Department of Defense Civilian Personnel
Sec. 911. Removal of Limits on the Use of Voluntary Early Retirement
Authority and Voluntary Separation Incentive Pay for
Fiscal Years 2002 and 2003.
Sec. 912. Authority for Designated Civilian Employees Abroad to Act as
a Notary.
Sec. 913. Inapplicability of Requirement for Studies and Reports When
All Directly Affected Department of Defense Civilian
Employees Are Reassigned to Comparable Federal Positions.
Sec. 914. Preservation of Civil Service Rights for Employees of the
Former Defense Mapping Agency.
Sec. 915. Financial Assistance to Certain Employees in Acquisition of
Critical Skills.
Sec. 916. Pilot Program for Payment of Retraining Expenses.
Subtitle C--Other Matters
Sec. 921. Authority to Ensure Demilitarization of Significant Military
Equipment Formerly Owned by the Department of Defense.
Sec. 922. Motor Vehicles: Documentary Requirements for Transportation
for Military Personnel and Federal Employees on Change of
Permanent Station.
Sec. 923. Department of Defense Gift Initiatives.
Sec. 924. Repeal of the Joint Requirements Oversight Council Semi-
Annual Report.
Sec. 925. Access to Sensitive Unclassified Information.
Sec. 926. Water Rights Conveyance, Andersen Air Force Base, Guam.
Sec. 927. Repeal of Requirement For Separate Budget Request For
Procurement of Reserve Equipment.
Sec. 928. Repeal of Requirement for Two-year Budget Cycle for the
Department of Defense.
TITLE I--PROCUREMENT
Authorization of Appropriations
Sec. 101. Army.
Sec. 102. Navy and Marine Corps.
Sec. 103. Air Force.
Sec. 104. Defense-Wide Activities.
Sec. 105. Defense Inspector General.
Sec. 106. Defense Health Program.
SEC. 101. ARMY.
Funds are hereby authorized to be appropriated for fiscal
year 2002 for procurement for the Army as follows:
(1) For aircraft, $1,925,491,000.
(2) For missiles, $1,859,634,000.
(3) For weapons and tracked combat vehicles,
$2,276,746,000.
(4) For ammunition, $1,193,365,000.
(5) For other procurement, $3,961,737,000.
(6) For chemical agents and munitions destruction,
$1,153,557,000 for--
(A) the destruction of lethal chemical weapons in
accordance with section 1412 of the Department of Defense
Authorization Act, 1986 (50 U.S.C. 1521) and
(B) the destruction of chemical warfare material of the
United States that is not covered by section 1412 of such
Act.
SEC. 102. NAVY AND MARINE CORPS.
(a) Navy.--Funds axe hereby authorized to be appropriated
for fiscal year 2002 for procurement for the Navy as follows:
(1) For aircraft, $8,252,543,000.
(2) For weapons, including missiles and torpedoes,
$1,433,475,000.
(3) For shipbuilding and conversion, $9,344,121,000.
(4) For other procurement, $4,097,576,000.
(b) Marine Corps.--Funds are hereby authorized to be
appropriated for fiscal year 2002 for procurement for the
Marine Corps in the amount of $981,724,000.
(c) Navy and Marine Corps Ammunition.--Funds are hereby
authorized to be appropriated for fiscal year 2002 for
procurement of ammunition for the Navy and Marine Corps in
the amount of $457,099,000.
SEC. 103. AIR FORCE.
Funds are hereby authorized to be appropriated for fiscal
year 2002 for procurement for the Air Force as follows:
(1) For aircraft, $10,744,458,000.
(2) For missiles, $3,233,536,000.
(3) For procurement of ammunition, $865,344,000.
(4) For other procurement, $8,158,521,000.
SEC. 104. DEFENSE-WIDE ACTIVITIES.
Funds are hereby authorized to be appropriated for fiscal
year 2002 for defense-wide procurement in the amount of
$1,603,927,000.
SEC. 105. DEFENSE INSPECTOR GENERAL.
Funds are hereby authorized to be appropriated for fiscal
year 2002 for procurement for the Defense Inspector General
in the amount of $1,800,000.
SEC. 106. DEFENSE HEALTH PROGRAM.
Funds are hereby authorized to be appropriated for fiscal
year 2002 for the Department of Defense for procurement for
carrying out health care programs, projects, and activities
of the Department of Defense in the total amount of
$267,915,000.
TITLE II--RESEARCH, DEVELOPMENT, TEST, AND EVALUATION
Sec. 201. Authorization of Appropriations.
SEC. 201. AUTHORIZATION OF APPROPRIATIONS.
Funds are hereby authorized to be appropriated for fiscal
year 2002 for the use of the Armed Forces for research,
development, test, and evaluation, as follows:
(1) For the Army, $6,693,920,000.
(2) For the Navy, $11,123,389,000.
(3) For the Air Force, $14,343,982,000.
(4) For Defense-wide research, development, test, and
evaluation, $15,268,142,000, of which $217,355,000 is
authorized for the Director of Operational Test and
Evaluation.
(5) For the Defense Health Program, $65,304,000.
TITLE III--OPERATION AND MAINTENANCE
Subtitle A--Authorization of Appropriations
Sec. 301. Operation and Maintenance Funding.
Sec. 302. Working Capital Funds.
Sec. 303. Armed Forces Retirement Home.
Sec. 304. Acquisition of Logistical Support for Security Forces.
Sec. 305. Contract Authority for Defense Working Capital Funds.
SEC. 301. OPERATION AND MAINTENANCE FUNDING.
Funds are hereby authorized to be appropriated for fiscal
year 2002 for the use of the Armed Forces of the United
States and other activities and agencies of the Department of
Defense, for expenses, not otherwise provided for, for
operation and maintenance, in amounts as follows:
(1) For the Army, $21,191,680,000.
(2) For the Navy, $26,961,382,000.
(3) For the Marine Corps, $2,892,314,000.
(4) For the Air Force, $26,146,770,000.
(5) For the Defense-wide activities, $12,518,631,000.
(6) For the Army Reserve, $1,787,246,000.
(7) For the Naval Reserve, $1,003,690,000.
(8) For the Marine Corps Reserve, $144,023,000.
(9) For the Air Force Reserve, $2,029,866,000.
(10) For the Army National Guard, $3,677,359,000.
(11) For the Air National Guard, $3,867,361,000.
(12) For the Defense Inspector General, $150,221,000.
(13) For the United States Court of Appeals for the Armed
Forces, $9,096,000.
(14) For Environmental Restoration, Army, $389,800,000.
(15) For Environmental Restoration, Navy, $257,517,000.
(16) For Environmental Restoration, Air Force,
$385,437,000.
(17) For Environmental Restoration, Defense-wide,
$23,492,000.
(18) For Environmental Restoration, Formerly Used Defense
Sites, $190,255,000.
(19) For Overseas Humanitarian, Disaster, and Civic Aid
programs, $49,700,000.
(20) For Drug Interdiction and Counter-drug Activities,
Defense-wide, $820,381,000.
(21) For the Kaho'olawe Island Conveyance, Remediation, and
Environmental Restoration Trust Fund, $25,000,000.
(22) For the Defense Health Program, $17,565,750,000.
(23) For Cooperative Threat Reduction programs,
$403,000,000.
(24) For Overseas Contingency Operations Transfer Fund,
$2,844,226,000.
(25) For Support for International Sporting Competitions,
Defense, $15,800,000.
SEC. 302. WORKING CAPITAL FUNDS.
Funds are hereby authorized to be appropriated for fiscal
year 2002 for the use of the Armed Forces of the United
States and other activities and agencies of the Department of
Defense for providing capital for working capital and
revolving funds in amounts as follows:
(1) For the Defense Working Capital Funds, $1,951,986,000.
(2) For the National Defense Sealift Fund, $506,408,000.
SEC. 303. ARMED FORCES RETIREMENT HOME.
There is hereby authorized to be appropriated for fiscal
year 2002 from the Armed Forces Retirement Home Trust Fund
the sum of $71,440,000 for the operation of the Armed Forces
Retirement Home, including the United States Soldiers' and
Airmen's Home and the Naval Home.
SEC. 304. ACQUISITION OF LOGISTICAL SUPPORT FOR SECURITY
FORCES.
Section 5 of the Multinational Force and Observers
Participation Resolution (Public Law 97-132; 95 Stat. 1695;
22 U.S.C. 3424) is amended by adding at the end the following
new subsection:
``(d) The United States may use contractors or other means
to provide logistical support to the Multinational Force and
Observers under this section in lieu of providing such
support through a logistical support unit comprised of
members of the armed forces. Notwithstanding subsections (a)
and (b) and section 7(b), support by a contractor or other
means under this subsection may be provided without
reimbursement, whenever the President determines that such
action enhances or supports the national security interests
of the United States.''.
SEC. 305. CONTRACT AUTHORITY FOR DEFENSE WORKING CAPITAL
FUNDS.
Contract authority in the amount of $427, 100,000, to
remain available until September 30, 2002, is hereby
authorized and appropriated to the Defense Working Capital
Fund for the procurement, lease-purchase with substantial
private sector risk, capital or operating multiple-year
lease, of a capital asset, multiple-year time charter of a
commercial craft or vessel and associated services.
Subtitle B--Environmental Provisions
Sec. 310. Reimburse EPA for Certain Costs in Connection with Hooper
Sands Site, in South Berwick, Maine.
[[Page S7208]]
Sec. 311. Extension of Pilot Program for the Sale of Air Pollution
Emission Reduction Incentives.
Sec. 312. Elimination of Report on Contractor Reimbursement Costs.
SEC. 310. REIMBURSE EPA FOR CERTAIN COSTS IN CONNECTION WITH
HOOPER SANDS SITE, IN SOUTH BERWICK, MAINE.
(a) Authority to Reimburse EPA.--Using funds described in
subsection (b), the Secretary of the Navy may pay
$1,005,478.00 to the Hooper Sands Special Account within the
Hazardous Substance Superfund established by section 9507 of
the Internal Revenue Code of 1986 (26 U.S.C. 9507) to
reimburse the Environmental Protection Agency in full for the
Remaining Past Response Costs incurred by the agency for
actions taken pursuant to the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 (42
U.S.C. 9601, et seq.) at the Hooper Sands site in South
Berwick, Maine, pursuant to an Interagency Agreement
entered into by the Department of the Navy and the
Enviromental Protection Agency in January 2001.
(b) Source of Funds.--Any payment under subsection (a)
shall be made using the amounts authorized to be appropriated
by paragraph (15) of section 301 to the Enviromental
Restoration, Navy account, established by section 2703(a)(3)
of title 10, United States Code.
SEC. 311. EXTENSION OF PILOT PROGRAM FOR THE SALE OF AIR
POLLUTION EMISSION REDUCTION INCENTIVES
Section 351(a) of the National Defense Authorization Act
for Fiscal Year 1998 (Public Law. 105-85; 111 Stat. 1629,
1692) is amended to read as follows:
``(2) The Secretary may carry out the pilot program during
the period beginning on the date of enactment of this Act
through September 30, 2003.''.
SEC. 312. ELIMINATION OF REPORT ON CONTRACTOR REIMBURSEMENT
COSTS.
Section 2706 of title 10, United States Code, is amended by
striking subsection (c) and redesignating subsections (d) and
(e) as subsections (c) and (d), respectively.
Subtitle C--Commissaries and Nonappropriated Fund Instrumentalities
Sec. 315. Costs Payable to the Department of Defense and Other Federal
Agencies for Services Provided to the Defense Commissary
Agency.
Sec. 316. Reimbursement for Non-Commissary Use of Commissary
Facilities.
Sec. 317. Commissary Contracts and Other Agencies and
Instrumentalities.
Sec. 318. Operation of Commissary Stores.
SEC. 315. COSTS PAYABLE TO THE DEPARTMENT OF DEFENSE AND
OTHER FEDERAL AGENCIES FOR SERVICES PROVIDED TO
THE DEFENSE COMMISSARY AGENCY.
Section 2482(b)(1) of title 10, United States Code, is
amended by striking ``However, the Defense Commissary Agency
may not pay for any such service provided by the United
States Transportation Command any amount that exceeds the
price at which the service could be procured through full and
open competition, as such term is defined in section 4(6) of
the Office of Federal Procurement Policy Act (41 U.S.C.
403(6)).'' and inserting ``The Defense Commissary Agency may
not pay for any service provided by a Defense working capital
fund activity which exceeds the price at which the service
could be procured through full and open competition by the
Defense Commissary Agency, as such term is defined in section
4(6) of the Office of Federal Procurement Policy Act (41
U.S.C. 403(6)). In determining the cost for providing such
service the Defense Commissary Agency may pay a Defense
working capital fund activity those administrative and
handling costs it would be required to pay for the provision
of such services had the Defense Commissary Agency acquired
them under full and open competition. Under no circumstances
will any costs associated with mobilization requirements,
maintenance of readiness, or establishment or maintenance of
infrastructure to support such mobilization or readiness
requirements, be included in rates charged the Defense
Commissary Agency.''.
SEC. 316. REIMBURSEMENT FOR NON-COMMISSARY USE OF COMMISSARY
FACILITIES.
(a) In General.--Chapter 147 of title 10, United States
Code, is amended by inserting at the beginning of the chapter
the following new section:
``Sec. 2481. Reimbursement for non-commissary use of
commissary facilities
``If a commissary facility acquired, constructed or
improved (in whole or in part) with commissary surcharge
revenues is used for non-commissary purposes, the Secretary
of the military department concerned shall reimburse the
commissary surcharge revenues for the commissary's share of
the depreciated value of the facility.''.
(b) Clerical Amendment.--The table of sections at the
beginning of such chapter 147 is amended by inserting before
the item relating to section 2482 the following new item:
``2481. Reimbursement for non-commissary use of commissary
facilities.''.
SEC. 317. COMMISSARY CONTRACTS AND OTHER AGENCIES AND
INSTRUMENTALITIES.
Section 2482(b) 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) Where the Secretary of Defense authorizes the Defense
Commissary Agency to sell limited exchange merchandise as
commissary store inventory under section 2486(b)(11) of this
title, the Defense Commissary Agency shall enter into a
contract or other agreement to obtain such merchandise
available from the Armed Service Exchanges, provided that
such merchandise shall be obtained at a cost of no more than
the exchange retail price less the amount of commissary
surcharge authorized to be collected by section 2486 of this
title. If such merchandise is procured by the Defense
Commissary Agency from other than the Armed Service
Exchanges, the limitations provided in section 2486(e) of
this title apply.''.
SEC. 318. OPERATION OF COMMISSARY STORES.
Section 2482(a) of title 10, United States Code, is amended
by striking ``A contract with a private person'' and all that
remains to the end of the subsection.
Subtitle D--Other Matters
Sec. 320. Reimbursement for Reserve Intelligence Support.
Sec. 321. Disposal of Obsolete and Excess Materials Contained in the
National Defense Stockpile.
SEC. 320. REIMBURSEMENT FOR RESERVE INTELLIGENCE SUPPORT.
(a) Appropriations available to the Department of Defense
for operations and maintenance may be used to reimburse
National Guard and Reserve units or organizations for the
pay, allowances and other expenses which are incurred by such
National Guard and Reserve units or organizations when
members of the National Guard or Reserve provide
intelligence, including counterintelligence, support to
Combatant Commands, Defense Agencies and Joint Intelligence
Activities, including the activities and programs included
within the National Foreign Intelligence Program, the Joint
Military Intelligence Program, and the Tactical Intelligence
and Related Activities aggregate.
(b) Nothing in this section authorizes deviation from
established Reserve and National Guard personnel and training
procedures.
SEC. 321. DISPOSAL OF OBSOLETE AND EXCESS MATERIALS CONTAINED
IN THE NATIONAL DEFENSE STOCKPILE.
Subject to the conditions specified in section 10(c) of the
Strategic and Critical Materials Stock Piling Act (50 U.S.C.
Sec. 98h-1(c)), the President may dispose of the following
obsolete and excess materials contained in the National
Defense Stockpile in the following quantities:
Bauxite, Refractory, 40,000 short tons.
Chromium Metal, 3,512 short tons.
Iridium, 25,140 troy ounces.
Jewel Bearings, 30,273,221 pieces.
Manganese, Ferro HC, 209,074 short tons.
Palladium, 11 troy ounces.
Quartz Crystal, 216,648 pounds.
Tantalum Metal Ingot, 120,228 pounds contained tantalum.
Tantalum Metal Powder, 36,020 pounds contained tantalum.
Thorium Nitrate, 600,000 pounds.
TITLE IV--MILITARY PERSONNEL AUTHORIZATIONS
Subtitle A--Active Forces
Sec. 401. End Strengths for Active Forces.
SEC. 401. END STRENGTHS FOR ACTIVE FORCES.
The Armed Forces are authorized strengths for active duty
personnel as of September 30, 2002, as follows:
(1) The Army, 480,000.
(2) The Navy, 376,000.
(3) The Marine Corps, 172,600.
(4) The Air Force, 358,800.
Subtitle B--Reserve Forces
See. 405. End Strengths for Selected Reserve.
Sec. 406. End Strengths for Reserves on Active Duty in Support of the
Reserves.
Sec. 407. End Strengths for Military Technicians (Dual Status).
Sec. 408. Fiscal Year 2002 Limitation on Number of Non-Dual Status
Technicians.
Sec. 409. Authorized Strengths: Reserve Officers and Senior Enlisted
Members on Active Duty or Full-time National Guard Duty
for Administration of the Reserves or National Guard.
Sec. 410. Increase in Authorized Strengths for Air Force Officers on
Active Duty in the Grade of Major.
SEC. 405. END STRENGTHS FOR SELECTED RESERVE.
(a) In General.--The Armed Forces are authorized strengths
for Selected Reserve personnel of the reserve components as
of September 30, 2002, as follows:
(1) The Army National Guard of the United States, 350,000.
(2) The Army Reserve, 205,000.
(3) The Naval Reserve, 87,000.
(4) The Marine Corps Reserve, 39,558.
(5) The Air National Guard of the United States, 108,400.
(6) The Air Force Reserve, 74,700.
(7) The Coast Guard Reserve, 8,000.
(b) Adjustments.--The end strengths prescribed by
subsection (a) for the Selected Reserve of any reserve
component shall be proportionately reduced by--
(1) the total authorized strength of units organized to
serve as units of the Selected Reserve of such component
which are on active duty (other than for training) at the end
of the fiscal year, and
[[Page S7209]]
(2) the total number of individual members not in units
organized to serve as units of the Selected Reserve of such
component who are on active duty (other than for training or
for unsatisfactory participation in training) without their
consent at the end of the fiscal year.
Whenever such units or such individual members are released
from active duty during any fiscal year, the end strength
prescribed for such fiscal year for the Selected Reserve of
such reserve component shall be increased proportionately by
the total authorized strengths of such units and by the total
number of such individual members.
SEC. 406. END STRENGTHS FOR RESERVES ON ACTIVE DUTY IN
SUPPORT OF THE RESERVES.
Within the end strengths prescribed in section 411(a), the
reserve components of the Armed Forces are authorized, as of
September 30, 2002, the following number of Reserves to be
serving on full-time active duty or, in the case of members
of the National Guard, full-time National Guard duty for the
purpose of organizing, administering, recruiting,
instructing, or training the reserve components:
(1) The Army National Guard of the United States, 22,974.
(2) The Army Reserve, 13,108.
(3) The Naval Reserve, 14,811.
(4) The Marine Corps Reserve, 2,261.
(5) The Air National Guard of the United States, 11,591.
(6) The Air Force Reserve, 1,437.
SEC. 407. END STRENGTHS FOR MILITARY TECHNICIANS (DUAL
STATUS).
The Reserve Components of the Army and the Air Force are
authorized strengths for military technicians (dual status)
as of September 30, 2002, as follows:
(1) For the Army Reserve, 5,999.
(2) For the Army National Guard of the United States,
23,128.
(3) For the Air Force Reserve, 9,818.
(4) For the Air National Guard of the United States,
22,422.
SEC. 408. FISCAL YEAR 2002 LIMITATION ON NUMBER OF NON-DUAL
STATUS TECHNICIANS.
The number of civilian employees who are non-dual status
technicians of a reserve component of the Army or Air Force
as of September 30, 2002, may not exceed the following:
(1) For the Army Reserve, 1,095.
(2) For the Army National Guard of the United States,
1,600.
(3) For the Air Force Reserve, 0.
(4) For the Air National Guard of the United States, 350.
SEC. 409. AUTHORIZED STRENGTHS: RESERVE OFFICERS AND SENIOR
ENLISTED MEMBERS ON ACTIVE DUTY OR FULL-TIME
NATIONAL GUARD DUTY FOR ADMINISTRATION OF THE
RESERVES OR NATIONAL GUARD.
(a) In General.--Section 12011 of title 10, United States
Code, is amended by amending the body of the section to read
as follows:
``(a) Ceilings for Full-Time Reserve Component Field Grade
Officers.--The number of reserve officers of the reserve
components of the Army, Navy, Air Force, and Marine Corps who
may be on active duty in the pay grades of O-4, O-5, O-6 for
duty described in sections 10211, 10302 through 10305, 123
10, or 12402 of this title, or full-time National Guard duty
(other than for training) under section 502(f) of title 32,
or section 708 of title 32, may not, at the end of any fiscal
year, exceed a number for that grade and reserve component in
accordance with the following tables:
``Army National Guard
------------------------------------------------------------------------
AGR Population O-4 (MAJ) O-5 (LTC) O-6 (COL)
------------------------------------------------------------------------
20,000........................ 1,500 850 325
22,000........................ 1,650 930 350
24,000........................ 1,790 1,010 370
26,000........................ 1,930 1,085 385
28,000........................ 2,070 1,160 400
30,000........................ 2,200 1,235 405
32,000........................ 2,330 1,305 408
34,000........................ 2,450 1,375 411
36,000........................ 2,570 1,445 411
38,000........................ 2,670 1,515 411
40,000........................ 2,770 1,580 411
42,000........................ 2,837 1,644 411
------------------------------------------------------------------------
``U.S. Army Reserve
------------------------------------------------------------------------
AGR Population O-4 (MAJ) O-5 (LTC) O-6 (COL)
------------------------------------------------------------------------
10,000........................ 1,390 740 230
11,000........................ 1,529 803 242
12,000........................ 1,668 864 252
13,000........................ 1,804 924 262
14,000........................ 1,940 984 272
15,000........................ 2,075 1,044 282
16,000........................ 2,210 1,104 291
17,000........................ 2,345 1,164 300
18,000........................ 2,479 1,223 309
19,000........................ 2,613 1,282 318
20,000........................ 2,747 1,341 327
21,000........................ 2,877 1,400 336
------------------------------------------------------------------------
``U.S. Naval Reserve
------------------------------------------------------------------------
AGR Population O-4 (MAJ) O-5 (LTC) O-6 (COL)
------------------------------------------------------------------------
10,000........................ 807 447 141
11,000........................ 867 467 153
12,000........................ 924 485 163
13,000........................ 980 503 173
14,000........................ 1,035 521 183
15,000........................ 1,088 538 193
16,000........................ 1,142 555 203
17,000........................ 1,195 565 213
18,000........................ 1,246 575 223
19,000........................ 1,291 585 233
20,000........................ 1,334 595 242
21,000........................ 1,364 603 250
22,000........................ 1,384 610 258
23,000........................ 1,400 615 265
24,000........................ 1,410 620 270
------------------------------------------------------------------------
``U.S. Marine Corps Reserve
------------------------------------------------------------------------
AGR Population O-4 (MAJ) O-5 (LTC) O-6 (COL)
------------------------------------------------------------------------
1,100......................... 106 56 20
1,200......................... 110 60 21
1,300......................... 114 63 22
1,400......................... 118 66 23
1,500......................... 121 69 24
1,600......................... 124 72 25
1,700......................... 127 75 26
1,800......................... 130 78 27
1,900......................... 133 81 28
2,000......................... 136 84 29
2,100......................... 139 87 30
2,200......................... 141 90 31
2,300......................... 143 92 32
2,400......................... 145 94 33
2,500......................... 147 96 34
2,600......................... 149 98 35
------------------------------------------------------------------------
``Air National Guard
------------------------------------------------------------------------
AGR Population O-4 (MAJ) O-5 (LTC) O-6 (COL)
------------------------------------------------------------------------
5,000......................... 333 335 251
6,000......................... 403 394 260
7,000......................... 472 453 269
8,000......................... 539 512 278
9,000......................... 606 571 287
10,000........................ 673 630 296
11,000........................ 740 688 305
12,000........................ 807 742 314
13,000........................ 873 795 323
14,000........................ 939 848 332
15,000........................ 1,005 898 341
16,000........................ 1,067 948 350
17,000........................ 1,126 998 359
18,000........................ 1,185 1,048 368
19,000........................ 1,235 1,098 377
20,000........................ 1,283 1,148 380
------------------------------------------------------------------------
``U.S. Air Force Reserve
------------------------------------------------------------------------
AGR Population O-4 (MAJ) O-5 (LTC) O-6 (COL)
------------------------------------------------------------------------
500........................... 83 85 50
1,000......................... 155 165 95
1,500......................... 220 240 135
2,000......................... 285 310 170
2,500......................... 350 369 203
3,000......................... 413 420 220
3,500......................... 473 464 230
4,000......................... 530 500 240
4,500......................... 585 529 247
5,000......................... 638 550 254
5,500......................... 688 565 261
6,000......................... 735 575 268
7,000......................... 770 595 280
8,000......................... 805 615 290
10,000........................ 835 635 300
------------------------------------------------------------------------
``(b) Grade Substitutions for Lower Grade Ceilings.--
Whenever the number of officers serving in any grade for duty
described in subsection (a) is less than the
number authorized for that grade under this section, the
difference between the two numbers may be applied to
increase the number authorized under this section for any
lower grade.
``(c) Determination of Authorized Ceilings.--If the total
number of members serving in the grades prescribed in the
above tables is between any two consecutive numbers in the
first column of the appropriate table, the corresponding
authorized strengths for each of the grades shown in that
table, for that component, are determined by mathematical
interpolation between the respective numbers of the two
strengths. If the total numbers of members serving on AGR
duty in the first column are greater or less than the figures
listed in the first column of the appropriate table, the
Secretary concerned shall fix the corresponding strengths for
the grades shown in that table at the same proportion as
reflected in the nearest limit shown in the table.
``(d) Secretarial Waiver.--Upon determination by the
Secretary of Defense that such action is in the national
interest, the Secretary may increase the number of reserve
officers that may be on active duty or full-time National
Guard duty in a controlled grade authorized pursuant to
subsection (a) for the current fiscal year for any of the
Reserve components by a number equal to not more than 5% of
the authorized strength in that controlled grade.''.
(b) In General.--Section 12012 of title 10, United States
Code, is amended by amending the body of the section to read
as follows:
C4 (a) Ceilings for Full-Time Reserve Component Senior
Enlisted Members.--The number of enlisted members in pay
grades of E-8 and E-9 for who may be on active duty under
section 10211 or 12310, or on full-time National Guard duty
under the authority of section 502(f) of title 32 (other than
for training) in connection with organizing, administering,
recruiting, instructing, or training the reserve components
or the National Guard may not, at the end of any fiscal year,
exceed a number determined in accordance with the following
tables:
``Army National Guard
------------------------------------------------------------------------
AGR Population E-8 (MSG) E-9 (SGM)
------------------------------------------------------------------------
20,000...................................... 1,650 550
22,000...................................... 1,775 615
24,000...................................... 1,900 645
26,000...................................... 1,945 675
28,000...................................... 1,945 705
30,000...................................... 1,945 725
32,000...................................... 1,945 730
34,000...................................... 1,945 735
36,000...................................... 1,945 738
38,000...................................... 1,945 741
40,000...................................... 1,945 743
42,000...................................... 1,945 743
------------------------------------------------------------------------
``U.S. Army Reserve
------------------------------------------------------------------------
AGR Population E-8 (MSG) E-9 (SGM)
------------------------------------------------------------------------
10,000...................................... 1,052 154
11,000...................................... 1,126 168
12,000...................................... 1,195 180
[[Page S7210]]
13,000...................................... 1,261 191
14,000...................................... 1,327 202
15,000...................................... 1,391 213
16,000...................................... 1,455 224
17,000...................................... 1,519 235
18,000...................................... 1,583 246
19,000...................................... 1,647 257
20,000...................................... 1,711 268
21,000...................................... 1,775 278
------------------------------------------------------------------------
``U.S. Naval Reserve
------------------------------------------------------------------------
AGR Population E-8 (SCPO) E-9 (MCPO)
------------------------------------------------------------------------
10,000.................................. 340 143
11,000.................................. 364 156
12,000.................................. 386 169
13,000.................................. 407 182
14,000.................................. 423 195
15,000.................................. 435 208
16,000.................................. 447 221
17,000.................................. 459 234
18,000.................................. 471 247
19,000.................................. 483 260
20,000.................................. 495 273
21,000.................................. 507 286
22,000.................................. 519 299
23,000.................................. 531 312
24,000.................................. 540 325
------------------------------------------------------------------------
``U.S. Marine Corps Reserve
------------------------------------------------------------------------
AGR Population E-8 (IST SGT) E-9 (SGTMAJ)
------------------------------------------------------------------------
1,100................................. 50 11
1,200................................. 55 12
1,300................................. 60 13
1,400................................. 65 14
1,500................................. 70 15
1,600................................. 75 16
1,700................................. 80 17
1,800................................. 85 18
1,900................................. 89 19
2,000................................. 93 20
2,100................................. 96 21
2,200................................. 99 22
2,300................................. 101 23
2,400................................. 103 24
2,500................................. 105 25
2,600................................. 107 26
------------------------------------------------------------------------
``Air National Guard
------------------------------------------------------------------------
AGR Population E-8 (SMSGT) E-9 (CMSGT)
------------------------------------------------------------------------
5,000................................. 1,020 405
6,000................................. 1,070 435
7,000................................. 1,120 465
8,000................................. 1,170 490,
9,000................................. 1,220 510
10,000................................ 1,270 530
11,000................................ 1,320 550
12,000................................ 1,370 570
13,000................................ 1,420 589
14,000................................ 1,470 608
15,000................................ 1,520 626
16,000................................ 1,570 644
17,000................................ 1,620 661
18,000................................ 1,670 678
19,000................................ 1,720 695
20,000.............................. 1,770 712
------------------------------------------------------------------------
``U.S. Air Force Reserve
------------------------------------------------------------------------
AGR Population E-8 (SMSGT) F-9 (CMSGT)
------------------------------------------------------------------------
500................................... 75 40
1,000................................. 145 75
1,500208.............................. 105
2,000................................. 270 130
2,500................................. 325 150
3,000................................. 375 170
3,500................................. 420 190
4,000................................. 460 210
4,500................................. 495 230
5,000................................. 530 250
05,500................................ 565 270
6,000................................. 600 290
7,000................................. 670 330
8,000................................. 740 370
10,000................................ 800 400
------------------------------------------------------------------------
``(b) Grade Substitution for Lower Grade Ceilings.--
Whenever the number of members serving in pay grade E-9 for
duty described in subsection (a) is less than the number
authorized for that grade under this section, the difference
between the two numbers may be applied to increase the number
authorized under this section for pay grade E-8.
``(c) Determination of Authorized Ceilings.--If the total
number of members serving in the grades prescribed in the
above tables is between, any two consecutive numbers in the
first column of the appropriate table, the corresponding
authorized strengths for each of the grades shown in that
table, for that component, are determined by mathematical
interpolation between the respective numbers of the two
strengths. If the total numbers of members serving on AGR
duty in the first column are greater or less than the
figures listed in the first column of the appropriate
table, the Secretary concerned shall fix the corresponding
strengths for the grades shown in that table at the same
proportion as reflected in the nearest limit shown in the
table.
``(d) Secretarial Waiver.--Upon determination by the
Secretary of Defense that such action is in the national
interest, the Secretary may increase the number of senior
reserve enlisted members that may be on active duty or full-
time National Guard duty in a controlled grade authorized
pursuant to subsection (a) for the current fiscal year for
any of the Reserve components by a number equal to not more
than 5% of the authorized strength in that controlled
grade.''.
SEC. 410. INCREASE IN AUTHORIZED STRENGTHS FOR AIR FORCE
OFFICERS ON ACTIVE DUTY IN THE GRADE OF MAJOR.
The table in section 523(a)(1) of title 10, United States
Code, is amended by striking the figures under the heading
``Major'' relating to the Air Force and inserting the
following:
``9,861
``10,727
``11,593
``12,460
``13,326
``14,192
``15,058
``15,925
``16,792
``17,657
``18,524
``19,389
``20,256
``21,123
``21,989
``22,855
``23,721
``24,588
``25,454.''.
TITLE V--MILITARY PERSONNEL POLICY
Subtitle A--Officer Personnel Policy
Sec. 501. Elimination of Certain Medical and Dental Requirements for
Army Early-Deployers.
Sec. 502. Medical Deferment of Mandatory Retirement or Separation.
Sec. 503. Officer in Charge; United States Navy Band.
Sec. 504. Removal of Requirement for Certification for Certain Flag
Officers to Retire in Their Highest Grade.
Sec. 505. Three-Year Extension of Certain Force Drawdown Transition
Authorities Relating to Personnel Management and
Benefits.
Sec. 506. Judicial Review of Selection Boards.
SEC. 501. ELIMINATION OF CERTAIN MEDICAL AND DENTAL
REQUIREMENTS FOR ARMY EARLY-DEPLOYERS.
Section 1074a of title 10, United States Code, is amended--
(1) by striking subsection (d); and
(2) by redesignating subsection (e) as subsection (d).
SEC. 502. MEDICAL DEFERMENT OF MANDATORY RETIREMENT OR
SEPARATION.
Section 640 of title 10, United States Code, is amended----
(1) by inserting ``(a)'' at the beginning of the paragraph;
(2) by striking ``cannot'' and inserting ``may not''; and
(3) by adding at the end the following new subparagraph
(b):
``(b) An officer whose mandatory retirement or separation
under this chapter or chapter 63 of this title is subject to
deferral under this section, may be extended for a period not
to exceed 30 days following completion of the evaluation
requiring hospitalization or medical observation.''.
SEC. 503. OFFICER IN CHARGE; UNITED STATES NAVY BAND.
(a) Detail and Grade.--Chapter 565 of title 10, United
States Code, is amended by inserting after section 6221 the
following new section:
Sec. 6221a. United States Navy Band: officer in charge
``An officer serving in a grade not below lieutenant
commander may be detailed as Officer in Charge of the United
States Navy Band. While so serving, an officer who holds a
grade lower than captain shall hold the grade of captain if
he is appointed to that grade by the President, by and with
the advice and consent of the Senate. Such appointment may
occur notwithstanding the limitation of subsection 5596(d) of
this title.''.
(b) Clerical Amendment.--The table of sections at the
beginning of such chapter 565 is amended by inserting after
the item referring to section 6221 the following new item:
``6221a. United States Navy Band: officer in charge.''.
SEC. 504. REMOVAL OF REQUIREMENT FOR CERTIFICATION FOR
CERTAIN FLAG OFFICERS TO RETIRE IN THEIR
HIGHEST GRADE.
Section 1370(c)(1) of title 10, United States Code, is
amended----
(1) by striking ``certifies in writing to the President and
Congress'' and inserting ``determines in writing''; and
(2) by adding at the end of the paragraph the following new
sentence:
``The Secretary of Defense shall issue regulations to
implement this paragraph.''.
SEC. 505. THREE-YEAR EXTENSION OF CERTAIN FORCE DRAWDOWN
TRANSITION AUTHORITIES RELATING TO PERSONNEL
MANAGEMENT AND BENEFITS.
(a) Extension of Early Retirement Authority for Active Duty
Members.--Section 4403(i) of the National Defense
Authorization Act for Fiscal Year 1993 (10 U.S.C. 1293 note)
is amended by striking ``October 1, 2001 ``and inserting
``October 1, 2004''.
(b) Extension of Authority for Special Separation Benefit
and Voluntary Early Separation Incentive.--(I) Section
1174a(h)(1) of title 10, United States Code, is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2004''.
(2) Section 1175(d)(3) of such title is amended by striking
``December 31, 2001 and inserting ``September 30, 2004''.
(c) Extension of Authority for Selective Early Retirement
Boards.--Section 63 8a(a) of such title is amended by
striking ``December 31, 2001 `` and inserting ``September 30,
2004''.
(d) Time-in-Grade Requirement for Retention of Grade upon
Voluntary Retirement.--(I) Section 1370(a)(2)(A) of such
title is amended by striking ``December 31, 2001'' and
inserting ``September 30, 2004''.
(2) Section 1370(d)(5) of such title is amended by striking
``December 31, 2001 and inserting ``September 30, 2004''.
(e) Minimum Commissioned Service for Voluntary Retirement
as an Officer.--
(1) Army.--Section 3911(b) of such title is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2004''.
[[Page S7211]]
(2) Navy.--Section 6323(a)(2) of such title is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2004''.
(3) Air force.--Section 8911(b) of such title is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2004''.
(f) Travel, Transportation, and Storage Benefits.--(1)
Section 404(c)(1)(C) of title 37, United States Code, is
amended by striking ``December 31, 2001'' and inserting
``September 30, 2004''.
(2) Section 404(f)(2)(B)(v) of such title is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2004''.
(3) Section 406(a)(2)(B)(v) of such title is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2004''.
(4) Section 406(g)(1)(C) of such title is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2004''.
(5) Section 503(c)(1) of the National Defense Authorization
Act for Fiscal Year 1991 (37 U.S.C. 406 note) is amended by
striking ``December 31, 2001 ``and inserting ``September 30,
2004''.
(g) Educational Leave for Public and Community Service.--
Section 4463(f) of the National Defense Authorization Art for
Fiscal Year 1993 (10 U.S.C. 1143a note) is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2004''.
(h) Transitional Health Benefits.--Section 1145 of title
10, United States Code, is amended--
(1) in subsection (a)(i), by striking ``December 31, 2001''
and inserting ``September 30, 2004''.
(2) in subsection (c)(1), by striking ``December 31, 2001''
and inserting ``September 30, 2004''.
(3) in subsection (e), by striking ``December 31, 2001''
and inserting ``September 30, 2004''.
(i) Transitional Commissary and Exchange Benefits.--Section
1146 of such title is amended by striking ``December 31,
2001'' both places it appears and inserting ``September 30,
2004''.
(j) Transitional Use of Military Housing.--Section 1147(a)
of such title is amended--
(1) in paragraph (1), by striking ``December 31, 2001'' and
inserting ``September 30, 2004''.
(2) in paragraph (2), by striking ``December 31, 2001'' and
inserting ``September 30, 2004''.
(k) Continued Enrollment of Dependents in Defense
Dependents Education System.--Section 1407(c)(1) of the
Defense Dependents' Education Act of 1978 (20 U.S.C.
926(c)(1)) is amended by striking ``December 31, 2001'' and
inserting ``September 30, 2004''.
(l) Force Reduction Transition Period Definition.--Section
4411 of the National Defense Authorization Act for Fiscal
Year 1993 (10 U.S.C. 12681 note) is amended by striking
``December 31, 2001'' and inserting ``September 30, 2004''.
(m) Temporary Special Authority for Force Reduction Period
Retirements.--Section 4416(b)(1) of the National Defense
Authorization Act for Fiscal Year 1993 (10 U.S.C. 12681 note)
is amended by striking ``October 1, 2001'' and inserting
``October 1, 2004''.
(n) Retired Pay for Non-regular Service.--(1) Section
12731(f) of title 10, United States Code, is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2004''.
(2) Section 12731a of such title is amended--
(A) in subsection (a)(1)(B), by striking ``the end of the
period described in subsection (b)'' and inserting ``October
1, 2004''.
(B) in subsection (b), by striking ``December 31, 2001''
and inserting ``October 1, 2004''.
(o) Affiliation with Guard and Reserve Units; Waiver of
Certain Limitations.--Section 1150(a) of such title is
amended by striking ``December 31, 2001'' and inserting
``'September 30, 2004''.
(p) Reserve Montgomery GI Bill.--Section 16133(b)(1)(B) of
such title is amended by striking ``December 31, 2001'' and
inserting ``September 30, 2004''.
SEC. 506. REVIEW OF ACTIONS OF SELECTION BOARDS.
(a) In General.--Chapter 79 of title 10, United States
Code, is amended by adding at the end the following:
``Sec. 1558. Exclusive remedies in cases involving selection
boards
``(a) Correction of Military Records.--The Secretary
concerned may correct a person's military records in
accordance with a recommendation made by a special board. Any
such correction shall be effective, retroactively, as of the
effective date of the action taken on a report of a previous
selection board that resulted in the action corrected in the
person's military records.
``(b) Relief Associated with Corrections of Certain
Actions.--(1) The Secretary concerned shall ensure that a
person receives relief under paragraph (2) or (3), as the
person may elect, if the person--
``(A) was separated or retired from an armed force, or
transferred to the retired reserve or to inactive status in a
reserve component, as a result of a recommendation of a
selection board; and
``(B) becomes entitled to retention on or restoration to
active duty or active status in a reserve component as a
result of a correction of the person's military records under
subsection (a).
``(2)(A) With the consent of a person referred to in
paragraph (1), the person shall be retroactively and
prospectively restored to the same status, rights, and
entitlements (less appropriate offsets against back pay and
allowances) in the person's armed force as the person would
have had if the person had not been selected to be separated,
retired, or transferred to the retired reserve or to inactive
status in a reserve component, as the case may be, as a
result of an action corrected under subsection (a). An action
under this subparagraph is subject to subparagraph (B).
``(B) Nothing in subparagraph (A) shall be construed to
permit a person to be on active duty or in an active status
in a reserve component after the date on which the person
would have been separated, retired, or transferred to the
retired reserve or to inactive status in a reserve component
if the person had not been selected to be separated, retired,
or transferred to the retired reserve or to inactive status
in a reserve component, as the case may be, in an action of a
selection board that is corrected under subsection (a).
``(3) If the person does not consent to a restoration of
status, rights, and entitlements under paragraph (2), the
person shall receive back pay and allowances (less
appropriate offsets) and service credit for the period
beginning on the date of the person's separation, retirement,
or transfer to the retired reserve or to inactive status in a
reserve component, as the case may be, and ending on the
earlier of--
``(A) the date on which the person would have been so
restored under paragraph (2), as determined by the Secretary
concerned; or
``(B) the date on which the person would otherwise have
been separated, retired, or transferred to the retired
reserve or to inactive status in a reserve component, as the
case may be.
``(c) Finality of Unfavorable Action.--If a special board
makes a recommendation not to correct the military records of
a person regarding action taken in the case of that person on
the basis of a previous report of a selection board, the
action previously taken on that report shall be considered as
final as of the date of the action taken on that report.
``(d) Regulations.--(1) The Secretary concerned may
prescribe regulations to carry out this section (other than
subsection (e)) with respect to the armed force or armed
forces under the jurisdiction of the Secretary.
``(2) The Secretary may prescribe in the regulations the
circumstances under which consideration by a special board
may be provided for under this section, including the
following:
``(A) The circumstances under which consideration of a
person's case by a special board is contingent upon
application by or for that person.
``(B) Any time limits applicable to the filing of an
application for consideration.
``(3) Regulations prescribed by the Secretary of a military
department under this subsection shall be subject to the
approval of the Secretary of Defense.
``(e) Judicial Review.--(l) A person challenging for any
reason the action or recommendation of a selection board, or
the action taken by the Secretary concerned on the report of
a selection board, is not entitled to relief in any judicial
proceeding unless the person has first been considered by a
special board under this section or the Secretary concerned
has denied such consideration.
``(2) A court of the United States may review a
determination by the Secretary concerned under this section
not to convene a special board. A court may set aside such
determination only if it finds the determination to be
arbitrary or capricious, not based on substantial evidence,
or otherwise contrary to law. If a court sets aside a
determination not to convene a special board, it shall remand
the case to the Secretary concerned, who shall provide for
consideration of the person by a special board under this
section.
``(3) A court of the United States may review the
recommendation of a special board convened under this section
and any action taken by the Secretary concerned on the report
of such special board. A court may set aside such
recommendation or action, as the case may be, only if it
finds that the recommendation or action was contrary to law
or involved a material error of fact or a material
administrative error. If a court sets aside the
recommendation of a special board, it shall remand the case
to the Secretary concerned, who shall provide for
reconsideration of the person by another special board. If a
court sets aside the action of the Secretary concerned on the
report of a special board, it shall remand the case to the
Secretary concerned for a new action on the report of the
special board.
``(f) Exclusivity of Remedies.--Notwithstanding any other
provision of law, but subject to subsection (g), the remedies
provided under this section are the only remedies available
to a person for correcting an action or recommendation of a
selection board regarding that person or an action taken on
the report of a selection board regarding that person.
``(g) Existing Jurisdiction.--(1) Nothing in this section
limits the jurisdiction of any court of the United States
under any provision of law to determine the validity of any
statute, regulation, or policy relating to selection boards,
except that, in the event that any such statute, regulation,
or policy is held invalid, the remedies prescribed in this
section shall be the sole and exclusive remedies available to
any person challenging the recommendation of a special board
on the basis of the invalidity.
[[Page S7212]]
``(2) Nothing in this section limits authority to correct a
military record under section 1552 of this title.
``(h) Timeliness of Action.--(1) For the purposes of
subsection (e)--
``(A) If, not later than six months after receipt of a
complete application for consideration by a special board,
the Secretary concerned shall have neither convened a special
board nor denied consideration by a special board, the
Secretary shall be deemed to have been denied such
consideration.
``(B) If, not later than one year after the convening of a
special board, the Secretary concerned shall not have taken
final action on the report of such board, the Secretary shall
be deemed to have denied relief to the person applying for
consideration by the board.
``(2) Under regulations prescribed in accordance with
subsection (d), the Secretary concerned may exclude an
individual application from the time limits prescribed in
this subsection if the Secretary determines that the
application warrants a longer period of consideration. The
authority of the Secretary of a military department under
this paragraph may not be delegated.
``(i) Inapplicability to Coast Guard.--This section does
not apply to the Coast Guard when it is not operating as a
service in the Navy.
``(j) Definitions.--In this section:
``(1) The term `special board'--
``(A) means a board that the Secretary concerned convenes
under any authority to consider whether to recommend a person
for appointment, enlistment, reenlistment, assignment,
promotion, retention, separation, retirement, or transfer to
inactive status in a reserve component instead of referring
the records of that person for consideration by a previously
convened selection board which considered or should have
considered that person;
``(B) includes a board for the correction of military or
naval records convened under section 1552 of this title, if
designated as a special board by the Secretary concerned; and
``(C) does not include a promotion special selection board
convened under section 628 or 14502 of this title.
``(2) The term `selection board'--
``(A) means a selection board convened under section
573(c), 580, 580a, 581, 611(b), 637, 638, 638a, 14101(b),
14701, 14704, or 14705 of this title, and any other board
convened by the Secretary concerned under any authority to
recommend persons for appointment, enlistment, reenlistment,
assignment, promotion, or retention in the armed forces or
for separation, retirement, or transfer to inactive status in
a reserve component for the purpose of reducing the number of
persons serving in the armed forces; and
``(B) does not include--
``(i) a promotion board convened under section 573(a),
611(a), or 14101(a) of this title;
``(ii) a special board;
``(iii) a special selection board convened under section
628 of this title; or
``(iv) a board for the correction of military records
convened under section 1552 of this title.''.
(b) Clerical Amendment.--The table of sections at the
beginning of such chapter 79 is amended by adding at the end
the following:
``1558. Exclusive remedies in cases involving selection boards.''.
(c) Special Selection Boards.--Section 628 of such title is
amended--
(1) by redesignating subsection (g) as subsection (j); and
(2) by inserting after subsection (f) the following new
subsections:
``(g) Limitations of Other Jurisdiction.--No official or
court of the United States may--
``(1) consider any claim based to any extent on the failure
of an officer or former officer of the armed forces to be
selected for promotion by a promotion board until--
``(A) the claim has been referred by the Secretary
concerned to a special selection board convened under this
section and acted upon by that board and the report of the
board has been approved by the President; or
``(B) the claim has been rejected by the Secretary
concerned without consideration by a special selection board;
or
``(2) except as provided in subsection (h), grant any
relief on such a claim unless the officer or former officer
has been selected for promotion by a special selection board
convened under this section to consider the officer's claim
and the report of the board has been approved by the
President.
``(h) Judicial Review.--(1) A court of the United States
may review a determination by the Secretary concerned under
subsection (a)(1) or (b)(1) not to convene a special
selection board. If a court finds the determination to be
arbitrary or capricious, not based on substantial evidence,
or otherwise contrary to law, it shall remand the case to the
Secretary concerned, who shall provide for consideration of
the officer or former officer by a special selection board
under this section.
``(2) A court of the United States may review the action of
a special selection board convened under this section on a
claim of an officer or former officer and any action taken by
the President on the report of the board. If a court finds
that the action was contrary to law or involved a material
error of fact or a material administrative error, it shall
remand the case to the Secretary concerned, who shall provide
for reconsideration of the officer or former officer by
another special selection board.
``(i) Existing Jurisdiction.--(1) Nothing in this section
limits the jurisdiction of any court of the United States
under any provision of law to determine the validity of any
statute, regulation, or policy relating to selection boards,
except that, in the event that any such statute, regulation,
or policy is held invalid, the remedies prescribed in this
section shall be the sole and exclusive remedies available to
any person challenging the recommendation of a selection
board on the basis of the invalidity.
``(2) Nothing in this section limits the authority of the
Secretary of a military department to correct a military
record under section 1552 of this title.''.
(c) Effective Date and Applicability.--(1) The amendments
made by this section shall take effect on the date of the
enactment of this Act and, except as provided in paragraph
(2), shall apply with respect to any proceeding pending on or
after that date without regard to whether a challenge to an
action of a selection board of any of the Armed Forces being
considered in such proceeding was initiated before, on, or
after that date.
(2) The amendments made by this section shall not apply
with respect to any action commenced in a court of the United
States before the date of the enactment of this Act.
Subtitle B--Reserve Component Personnel Policy
Sec. 511. Retirement of Reserve Personnel.
Sec. 512. Amendment to Reserve PERSTEMPO Definition.
Sec. 513. Individual Ready Reserve Physical Examination Requirement.
Sec. 514. Benefits and Protections for Members in a Funeral Honors Duty
Status.
Sec. 515. Funeral Honors Duty Performed by Members of the National
Guard.
Sec. 516. Strength and Grade Ceiling Accounting for Reserve Component
Members on Active Duty in Support of a Contingency
Operation.
Sec. 517. Reserve Health Professionals Stipend Program Expansion.
Sec. 518. Reserve Officers on Active Duty for a Period of Three Years
or Less.
Sec. 519. Active Duty End Strength Exemption for National Guard and
Reserve Personnel Performing Funeral Honors Functions.
Sec. 520. Clarification of Functions That May Be Assigned to Active
Guard and Reserve Personnel on Full-Time National Guard
Duty.
Sec. 521. Authority for Temporary Waiver of the Requirement for a
Baccalaureate Degree for Promotion of Certain Reserve
Officers of the Army.
Sec. 522. Authority of the President to Suspend Certain Laws Relating
to Promotion, Retirement and Separation; Duties.
SEC. 511. RETIREMENT OF RESERVE PERSONNEL.
(a) Retired Reserve.--Section 10154(2) of title 10, United
States Code, is amended by striking ``upon their request''.
(b) Retirement for Failure of Selection of Promotion.--(1)
Section 14513 of such title 10 is amended--
(A) in the heading, by inserting ``or retirement'' after
``Separation''; and
(B) in paragraph (2), by striking ``'and applies'' and
inserting ``unless the officer requests not to be transferred
to the Retired Reserve'' before the semicolon.
(2) The table of sections at the beginning of chapter 1407
of such title 10 is amended by striking the item relating to
section 14513 and inserting the following new item:
``14513. Separation or retirement for failure of selection for
promotion.''.
(c) Retirement for Years of Service or After Selection for
Early Removal.--Section 14514 of such title 10 is amended--
(1) in paragraph (1), by striking ``and applies'' and
inserting `` unless the officer requests not to be
transferred to the Retired Reserve'' before the semicolon;
and
(2) in paragraph (2), by striking ``does not apply for such
transfer'' and inserting ``has requested not to be
transferred to the Retired Reserve'' after ``is not qualified
or''.
(d) Retirement for Age.--Section 14515 of such title 10 is
amended--
(1) in paragraph (1), by striking ``and applies'' and
inserting ``unless the officer requests not to be transferred
to the Retired Reserve'' before the semicolon; and
(2) in paragraph (2), by striking ``does not apply for
transfer'' and inserting ``has requested not to be
transferred'' following ``is riot qualified or''.
(e) Discharge or retirement of warrant officers for years
of service or age.--(1) Chapter 1207 of such title 10 is
amended by adding at the end the following new section:
``12244. Warrant officers: discharge or retirement for years
of service or for age
``Each reserve warrant officer of the Army, Navy, Air
Force, or Marine Corps who is in an active status and has
reached the maximum years of service or age prescribed by the
Secretary concerned shall--
``(1) be transferred to the Retired Reserve, if the warrant
officer is so qualified for such transfer, unless the warrant
officer requests not to be transferred to the Retired
Reserve; or
``(2) if the warrant officer is not qualified for such
transfer or requests not to be 42 transferred to the Retired
Reserve, be discharged.''.
[[Page S7213]]
(2) The table of sections at the beginning of such chapter
1207 of title 10 is amended by adding at the end the
following new item:
``12244. Warrant officers: discharge or retirement for years of service
or for age.''.
(f) Discharge, or Retirement of Enlisted Members for Years
of Service or Age.--(1) Chapter 1203 of such title 10 is
amended by addinc, at the end the following new section:
``12108. Enlisted members: discharge or retirement for years
of service or for age
``Each reserve enlisted member of the Army, Navy, Air
Force, or Marine Corps who is in an active status and has
reached the maximum years of service or age prescribed by the
Secretarv concerned shall--
``(1) be transferred to the Retired Reserve, if the member
is so qualified for such transfer, unless the member requests
not to be transferred to the Retired Reserve; or
``(2) if the member is not qualified for such transfer or
requests not to be transferred to the Retired Reserve, be
discharged.''.
(2) The table of sections at the beginning of such chapter
is amended by adding at the end the following new item:
``12108. Enlisted members: discharge or retirement for years of service
or for age.''.
SEC. 512. AMENDMENT TO RESERVE PERSTEMPO DEFINITION.
Section 991(b) of title 10, United States Code, is
amended--
(1) in paragraph (1), by inserting ``active'' before
``service'' and adding at the end the following new sentence:
``For the purpose of this definition, the housing in which
a member of a reserve component resides is either the housing
the member normally occupies when on garrison duty or the
member's permanent civilian residence.'';
(2) by striking paragraph (2);
(3) by redesignating paragraphs (3) and (4) as paragraphs
(2) and (3) respectively; and
(4) in paragraph (3) (as redesignated), by striking ``in
paragraphs (1) and (2).'' and inserting ``in paragraph
(1).''.
SEC. 513. INDIVIDUAL READY RESERVE PHYSICAL EXAMINATION
REQUIREMENT.
Section 10206 of title 10, United States Code, is amended--
(1) in subsection (a), by striking ``Ready Reserve'' and
inserting ``Selected Reserve'';
(2) by redesignating subsection (b) as subsection (c); and
(3) by inserting after subsection (a) the following new
subsection:
``(b) As determined by the Secretary concerned, each member
of the Individual Ready Reserve or Inactive National Guard
shall be provided a physical examination, if required--
``(1) to determine the member's fitness for military duty;
or
``(2) for promotion, attendance at a military school or
other career progression requirements.''.
SEC. 514. BENEFITS AND PROTECTIONS FOR MEMBERS IN A FUNERAL
HONORS DUTY STATUS.
(a) Persons Subject to the Uniformed Code of Military
Justice.--Section 802 of title 10, United States Code, is
amended--
(1) in subsection (a)(3), by inserting ``or in a funeral
honors duty status'' after ``on inactive-duty training''; and
(2) in subsection (d)(2)(B), by inserting ``or in a funeral
honors duty status'' after ``on inactive-duty training''.
(b) Benefits for Dependents of a Deceased Reserve Component
Member.--Section 1061 of such title 10 is amended--
(1) in subsection (b)(1), by striking ``or'' the first time
it appears and inserting ``, or funeral honors duty'' before
the semicolon; and
(2) in subsection (b)(2), by striking ``or'' the first time
it appears and inserting ``, or funeral honors duty'' before
the period.
(c) Payment of a Death Gratuity.--(1) Section 1475(a) of
such title 10 is amended--
(A) by redesignating paragraphs (3), (4) and (5) as
paragraphs (4), (5) and (6), respectively;
(B) by inserting after paragraph (2) the following new
paragraph:
``(3) a Reserve of an armed force who dies while performing
funeral honors duty;''; and
(C) in paragraph (4) (as redesignated in subsection (c)(1))
by--
(i) striking ``or'' both time it appears;
(ii) inserting ``or funeral honors duty'' after ``Public
Health Service),'';
(iii) inserting a comma before and after ``inactive duty
training'' the second time it appears in the sentence; and
(iv) inserting ``or funeral honors duty'' before the
semicolon.
(2) Section 1476(a) of such title 10 is amended--
(A) in paragraph (1)(A), by striking ``or'';
(B) in paragraph (1)(B), by striking the period and
inserting ``; or'';
(C) by adding at the end of paragraph (1) the following new
subparagraph:
``(C) funeral honors duty.''; and
(D) in paragraph (2)(A), by striking ``or'' the first time
it appears and inserting ``, or funeral honors duty'' after
``inactive-duty training''.
(d) Military Authority for Members of the Coast Guard
Reserve.--Section 704 of title 14, United States Code, is
amended by--
(1) striking ``or'' the first time it appears in the second
sentence; and
(2) inserting ``, or funeral honors duty'' after
``inactive-duty training''.
(E) Benefits for Members of the Coast Guard Reserve.--
Section 705(a) of such title 14 is amended by inserting ``on
funeral honors duty,'' after ``on inactive-duty training,''.
(f) Definitions.--Section 101 of title 38, United States
Code, is amended--(l) in paragraph (24), by striking ``and''
following ``aggravated in the line of duty,'' and inserting
``, and any period of funeral honors duty during which the
individual concerned was disabled or died from an injury
incurred or aggravated in line of duty'' before the period;
and
(2) by adding at the end the following new paragraph:
``(34) The term ``Funeral Honors Duty'' means--
``(A) duty prescribed for Reserves by the Secretary
concerned under section 12503 of title 10 to prepare for or
perform funeral honors functions at the funeral of a veteran;
`` (B) in the case of members of the Army National Guard or
Air National Guard of any State, duty under section 115 of
title 32 to prepare for or perform funeral honors functions
at the funeral of a veteran; and
``(C) Authorized travel to and from such duty.''.
SEC. 515. FUNERAL HONORS DUTY PERFORMED BY MEMBERS OF THE
NATIONAL GUARD.
Section 1491 (b) of title 10, United States Code, is
amended by inserting after paragraph (2) the following new
paragraph:
``(3) A member of the Army National Guard of the United
States or Air National Guard of the United States who serves
as a member of a funeral honors detail while serving in a
duty status authorized under state law shall be considered to
be a member of the armed forces for the purpose of fulfilling
the two member funeral honors detail requirement in paragraph
(2).''.
SEC. 516. STRENGTH AND GRADE CEILING ACCOUNTING FOR RESERVE
COMPONENT MEMBERS ON ACTIVE DUTY IN SUPPORT OF
A CONTINGENCY OPERATION.
(a) Active Duty Strength Accounting--Section 11 5(c) of
title 10, United States Code is amended--
(1) in subparagraph (1), by striking ``and'' at the end of
the subparagraph;
(2) in subparagraph (2), by striking the period and adding
``; and'' at the end of the subparagraph; and
(3) by adding the following new subparagraph:
``(3) increase the end strength authorized pursuant to
subsection (a)(1)(A) for a fiscal year for any of the armed
forces by a number equal to the number of members of the
reserve components on active duty under section 12301(d) of
this title in support of a contingency operation as defined
in section 101(a)(13) of this title.''.
(b) Increase in Authorized Daily Average for Members in Pay
Grades E-8 and E-9 on Active Duty Under Certain
Circumstances.--Section 517 of such title 10 is amended at
the end by adding the following new paragraph:
``(d) The Secretary of Defense may increase the authorized
daily average number of enlisted members on active duty in an
armed force in pay grades E-8 and E-9 in a fiscal year
pursuant to subsection (a) by the number of enlisted members
of a reserve component in that armed force in the pay grades
of E-8 and E-9 on active duty under section 12301(d) of this
title in support of a contingency operation as defined in
section 101(a)(13) of this title,''.
(c) Increase in Authorized Strengths for Commissioned
Officers in Pay Grades O-4, O-5 and O-6 on Active Duty Under
Certain Circumstances.--Section 523 of such title 10 is
amended----
(1) in paragraphs (a)(1) and (a)(2), by striking
``subsection (c)'' and inserting subsections (c) and (e)'';
and
(2) by adding at the end the following new subsection:
``(e) The Secretary of Defense may increase the authorized
total number of commissioned officers serving on active duty
at the end of any fiscal year pursuant to subsection (a) by
the number of commissioned officers of a reserve component of
the Army, Navy, Air Force, or Marine Corps on active duty
under section 12301(d) of this title in support of a
contingency operation as defined in section 101(a)(13) of
this title.''.
(d) Increase, in Authorized Strengths for General and Flag
Officers on Active Duty Under Certain Circumstances.--Section
526(a) of such title 10 is amended by----
(1) striking ``the'' the first time it appears;
(2) inserting ``(1) Except as provided in paragraph (2),
the'' following ``Limitations.----'';
(3) redesignating paragraphs (1), (2), (3) and (4) as
subparagraphs (A), (B), (C) and (D), respectively; and
(4) inserting after subparagraph (D) (as redesignated by
section (d)(3)) the following new paragraph:
``(2) The Secretary of Defense may increase the number of
general and flag officers on active duty pursuant to
paragraph (1) by the number of reserve component general and
flag officers on active duty under section 12301(d) of this
title in support of a contingency operation as defined in
section 101(a)(13) of this title.''.
SEC. 517. RESERVE HEALTH PROFESSIONALS STIPEND PROGRAM
EXPANSION.
(a) Purpose of Program.--Section 16201(a) of title 10,
United States Code, is amended to read as follows:
``(a) Establishment of Program.--For the purposes of
obtaining adequate numbers of
[[Page S7214]]
commissioned officers in the reserve components who are
qualified in health professions, the Secretary of each
military department may establish and maintain a program to
provide financial assistance under this chapter to persons
engaged in training that leads to a degree in medicine or
dentistry, and to a health professions specialty critically
needed in wartime. Under such a program, the Secretary
concerned may agree to pay a financial stipend to persons
engaged in health care education and training in return for a
commitment to subsequent service in the Ready Reserve.''
(b) Medical and Dental Student Stipend.--Section 16201 of
such title 10 is amended by----
(1) redesignating subsections (b), (c), (d) and (e) as
subsections (c), (d), (e) and (f);
(2) inserting the following new subsection:
``(b) Medical and Dental School Students.--(1) Under the
stipend program under this chapter, the Secretary of the
military department concerned may enter into an agreement
with a person who----
``(A) is eligible to be appointed as an officer in a
Reserve component;
``(B) is enrolled or has been accepted for enrollment in an
institution in a course of study that results in a degree in
medicine or dentistry;
``(C) signs an agreement that, unless sooner separated, the
person will----
``(i) complete the educational phase of the program;
``(ii) accept a reappointment or redesignation within his
reserve component, if tendered, based upon his health
profession, following satisfactory completion of the
educational and intern programs; and
``(iii) participate in a residency program; and
(D) if required by regulations prescribed by the Secretary
of Defense, agrees to apply for, if eligible, and accept, if
offered, residency training in a health profession skill
which has been designated by the Secretary of Defense as a
critically needed wartime skill.
``(2) Under the agreement----
``(A) the Secretary of the military department concerned
shall agree to pay the participant a stipend, in the amount
determined under subsection (f), for the period or the
remainder of the period the student is satisfactorily
progressing toward a degree in medicine or dentistry while
enrolled in an accredited medical or dental school;
``(B) the participant shall not be eligible to receive such
stipend before appointment, designation, or assignment as an
officer for service in the Ready Reserve;
(C) the participant shall be subject to such active duty
requirements as may be specified in the agreement and to
active duty in time of war or national emergency as provided
by law for members of the Ready Reserve; and
``(D) the participant shall agree to serve, upon successful
completion of the program, one year in the Selected Reserve
for each six months, or part thereof, for which the stipend
is provided. In the case of a participant who enters into a
subsequent agreement under subsection (c) and successfully
completes residency training in a specialty designated by the
Secretary of Defense as a specialty critically needed by the
military department in wartime, the requirement to serve in
the Selected Reserve may be reduced to one year for each
year, or part thereof, for which the stipend was provided
while enrolled in medical or dental school.''
(c) Wartime Critical Skills.--Section 16201(c), (as
redesignated by section (b)), is amended----
(1) by inserting ``WARTIME'' following ``CRITICAL'' in the
heading; and
(2) in paragraph (1)(B) by inserting ``or has been
appointed as a medical or dental officer in the Reserve of
the armed force concerned'' before the semicolon at the end
of the paragraph.
(d) Service Obligation Requirement.--Subparagraph (2)(D) of
subsection (c), (as redesignated by section (b)), and
subparagraph (2)(D) of subsection (d), (as redesignated by
section (b)), are amended by striking ``two years in the
Ready Reserve for each year,'' and inserting ``one year in
the Ready Reserve for each six months,''.
(e) Clerical Amendments.--Subparagraphs (2)(A) of
subsection (c), (as redesignated by section (b)), and
subparagraph (2)(A) of subsection (d), (as redesignated by
section (b)), are amended by striking ``subsection (e)'' and
inserting ``subsection (f)''.
SEC. 518. RESERVE OFFICERS ON ACTIVE DUTY FOR A PERIOD OF
THREE YEARS OR LESS.
(a) Clarification of Exemption.--Section 641(l)(D) of title
10, United States Code, is amended to read as follows:
``(D) on active duty under section 12301(d) of this title,
other than as provided under subparagraph (C), provided the
call or order to active duty, as prescribed in regulations of
the Secretary concerned, specifies a period of three years or
less and continued placement on the reserve active-status
list;''.
(b) Retroactive Application.--(1) Officers who were placed
on the reserve active status list under section 641(1)(D), as
amended by section 521 of the Floyd D. Spence National
Defense Authorization Act for Fiscal Year 2001 (Public Law
106-398; 114 Stat. 1654A-108), may be considered, as
determined by the Secretary concerned, to have been on the
active-duty list during the period beginning on the date of
enactment of Public Law 106-398 through the date of enactment
of this Act.
(2) Officers who were placed on the active duty list on
or after October 30, 1997, may, at the discretion of the
Secretary concerned, be placed on the reserve active-status
list upon enactment of this Act, provided they otherwise meet
the conditions specified in section 641(1)(D) as amended by
this Act.
SEC. 519. ACTIVE DUTY END STRENGTH EXEMPTION FOR NATIONAL
GUARD AND RESERVE PERSONNEL PERFORMING FUNERAL
HONORS FUNCTIONS.
Section 115(d) of title 10, United States Code, is amended
by adding at the end the following new paragraphs:
``(10) Members of reserve components on active duty to
prepare for and to perform funeral honors functions for
funerals of veterans in accordance with section 1491 of this
title.
``(11) Members on full-time National Guard duty to prepare
for and to perform funeral honors functions for funerals of
veterans in accordance with section 1491 of this title.''.
SEC. 520. CLARIFICATION OF FUNCTIONS THAT MAY BE ASSIGNED TO
ACTIVE GUARD AND RESERVE PERSONNEL ON FULL-TIME
NATIONAL GUARD DUTY.
Section 12310(b) of title 10, United States Code, is
amended by inserting ``, or a Reserve who is a member of the
National Guard serving on full-time National Guard duty under
section 502(f) of title 32 in connection with functions
referred to in subsection (a),'' after ``on active duty as
described in subsection (a)''.
SEC. 521. AUTHORITY FOR TEMPORARY WAIVER OF THE REQUIREMENT
FOR A BACCALAUREATE DEGREE FOR PROMOTION OF
CERTAIN RESERVE OFFICERS OF THE ARMY.
Section 516 of the Strom Thurmond National Defense
Authorization Act for Fiscal Year 1999 (Public Law 105-261;
112 Stat. 1920, 2008) is amended----
(1) in subsection (a), by striking ``(a) Waiver Authority
for Army OCS Graduates.--'' and ``before the date of the
enactment of this Act''; and
(2) in subsection (b), by striking ``2000'' and inserting
``2003''.
SEC. 522. AUTHORITY OF THE PRESIDENT TO SUSPEND CERTAIN LAWS
RELATING TO PROMOTION, RETIREMENT AND
SEPARATION; DUTIES.
Section 12305 of title 10, United States Code, is amended
by adding at the end the following new subsection (c):
``(c) Active duty members whose mandatory separations or
retirements incident to section 1251 or sections 632-637 of
this title are delayed pursuant to invocation of this
section, will be afforded up to 90 days following termination
of the suspension before being separated of retired.''.
Subtitle C--Education and Training
Sec. 531. Authority for the Marine Corps University to Award the
Degree of Master of Strategic Studies.
Sec. 532. Reserve Component Distributed Learning.
Sec. 533. Repeal of Limitation on Number of Junior Reserve Officers'
Training Corps (JROTC) Units.
Sec. 534. Modification of the Nurse Officer Candidate Accession Program
Restriction on Students Attending Civilian Educational
Institutions with Senior Reserve Officers' Training
Programs.
Sec. 535. Defense Language Institute Foreign Language Center.
SEC.531. AUTHORITY FOR THE MARINE CORPS UNIVERSITY TO AWARD
THE DEGREE OF MASTER OF STRATEGIC STUDIES.
(a) Authority to Confer Degree.--Upon the recommendation of
the Director and faculty of the Marine Corps War College of
the Marine Corps University, the President of the Marine
Corps University may confer the degree of master of strategic
studies upon graduates of the college who fulfill the
requirements for the degree.
(b) Regulation.--The Secretary of the Navy shall promulgate
regulations under which the Director of the faculty of the
Marine Corps War College of the Marine Corps University shall
administer the authority in subsection (a).
(e) Effective Date.--The authority to award degrees
provided by subsection (a) shall become effective on the date
on which the Secretary of Education determines that the
requirements established by the Marine Corps War College of
the Marine Corps University for the degree of master of
strategic studies are in accordance with generally applicable
requirements for a degree of master of arts.
SEC. 532. RESERVE COMPONENT DISTRIBUTED LEARNING.
(a) Compensation for Distributed Learning.--Section 206(d)
of title 37, United States Code, is amended to read as
follows:
``(d) A member of a Reserve Component may be paid
compensation under this section for the successful completion
of courses of instruction undertaken by electronic, paper-
based, or other distributed learning. Distributed Leaming is
structured leaming that takes place without 55 requiring the
physical presence of an instructor. To be compensable, the
instruction must be required by law, Department of Defense
policy, or service regulation and may be accomplished either
independently or as part of a group.''.
(b) Definition of Inactive-Duty Training.--Section 101(22)
of title 37, United States Code, is amended by striking ``,
but does not include work or study in connection with a
correspondence course of a uniformed service''.
[[Page S7215]]
SEC. 533. REPEAL OF LIMITATION ON NUMBER OF JUNIOR RESERVE
OFFICERS' TRAINING CORPS (JROTC) UNITS.
Section 2031(a)(1) of title 10, United States Code, is
amended by striking the second sentence.
SEC. 534. MODIFICATION OF THE NURSE OFFICER CANDIDATE
ACCESSION PROGRAM RESTRICTION ON STUDENTS
ATTENDING CIVILIAN EDUCATIONAL INSTITUTIONS
WITH SENIOR RESERVE OFFICERS' TRAINING
PROGRAMS.
Section 2130a of title 10, United States Code, is amended--
(1) in paragraph (a)(2), by striking ``that does not have a
Senior Reserve Officers'' Training Program established under
section 2102 of this title;'' and
(2) in paragraph (b)(1), by adding at the end ``or that has
a Senior Reserve Officers'' Training Program for which the
student is ineligible.''.
SEC. 535. DEFENSE LANGUAGE INSTITUTE FOREIGN LANGUAGE CENTER.
(a) Subject to subsection (b), the Commandant of the
Defense Language Institute Foreign Language Center
(Institute) may confer an Associate of Arts degree in Foreign
Language upon graduates of the Institute who fulfill the
requirements for the degree.
(b) No degree may be conferred upon any student under this
section unless the Provost certifies to the Commandant of the
Institute that the student has satisfied all the requirements
prescribed for such degree.
(c) The authority provided by subsection (a) shall be
exercised under regulations prescribed by the Secretary of
Defense.
Subtitle D--Decorations, Awards, and Commendations
Sec. 541. Authority for Award of the Medal of Honor to Humbert R.
Versace for Valor During the Vietnam War.
Sec. 542. Issuance of Duplicate Medal of Honor.
Sec. 543. Repeal of Limitation on Award of Bronze Star to Members in
Receipt of Special Pay.
SEC. 541. AUTHORITY FOR AWARD OF THE MEDAL OF HONOR TO
HUMBERT R. VERSACE FOR VALOR DURING THE VIETNAM
WAR.
(a) Waiver of Time Limitations.--Notwithstanding the time
limitations specified in section 3744 of title 10, United
States Code, or any other time limitation with respect to the
awarding of certain medals to persons who served in the
military service, the President may award the Medal of Honor
under section 3741 of that title to Humbert R. Versace for
the acts of valor referred to in subsection (b).
(b) Action Described.--The acts of valor referred to in
subsection (a) are the actions of Humbert R. Versace between
October 29, 1963, and September 26, 1965, while interned as a
prisoner of war by the Vietnamese Communist National
Liberation Front (Viet Cong) in the Republic of Vietnam.
SEC. 542. ISSUANCE OF DUPLICATE MEDAL OF HONOR.
(a) Section 3747 of title 10, United States Code, is
amended--
(1) in the section heading, by adding at the end''; issuance
of duplicate medal of honor'';
(2) by striking ``Any medal of honor'' and inserting ``(a)
Replacement of Medals.--Any medal of honor'';
(3) by inserting ``stolen,'' before ``lost or destroyed,'';
and
(4) by adding at the end the following new subsection:
``(b) Issuance of Duplicate Medal of Honor.--Upon written
application by a person to whom a medal of honor has been
awarded under this chapter, the Secretary of the Army may
issue such person, without charge, one duplicate medal of
honor, with ribbons and appurtenances. Such duplicate shall
be marked, in a manner the Secretary may determine, as a
duplicate or for display purposes only. The issuance of a
duplicate medal of honor under the authority of this
subsection shall not constitute the award of more than one
medal of honor within the meaning of section 3744(a) of this
title.''.
(b) Section 6253 of such title is amended--
(1) in the section heading, by adding at the end ``;
issuance of duplicate medal of honor'';
(2) by striking ``The Secretary of the Navy may replace''
and inserting ``(a) Replacement of Medals.--The Secretary of
the Navy may replace'';
(3) by inserting ``stolen,'' before ``lost or destroyed'';
and
(4) by adding at the end the following new subsection:
``(b) Issuance of Duplicate Medal of Honor.--Upon written
application by a person to whom a medal of honor has been
awarded under this chapter, the Secretary of the Navy may
issue such person, without charge, one duplicate medal of
honor, with ribbons and appurtenances. Such duplicate shall
be marked, in a manner the Secretary may determine, as a
duplicate or for display purposes only. The issuance of a
duplicate medal of honor under the authority of this
subsection shall not constitute the award of more than one
medal of honor within the meaning of section 6247 of this
title.''.
(c) Section 8747 of such title is amended--
(1) in the section heading, by adding at the end'';
issuance of duplicate medal of honor'';
(2) by striking ``Any medal of honor'' and inserting ``(a)
Replacement of Medals.--Any medal of honor'';
(3) by inserting ``stolen,'' before ``lost or destroyed,'';
and
(4) by adding at the end the following new subsection:
``(b) Issuance of Duplicate Medal of Honor.--Upon written
application by a person to whom a medal of honor has been
awarded under this chapter, the Secretary of the Air Force
may issue such person, without charge, one duplicate medal of
honor, with ribbons and appurtenances. Such duplicate shall
be marked, in a manner the Secretary may determine, as a
duplicate or for display purposes only. The issuance of a
duplicate medal of honor under the authority of this
subsection shall not constitute the award of more than one
medal of honor within the meaning of section 8744(a) of this
title.''.
(d) Clerical Amendments.--(1) The item relating to section
3747 of such title in the table of sections at the beginning
of chapter 357 of such title is amended to read as follows:
``3747. Medal of honor; distinguished-service cross; distinguished-
service medal; silver star: replacement; issuance of
duplicate medal of honor.'';
(2) The item relating to section 6253 of such title in the
table of sections at the beginning of chapter 567 of such
title is amended to read as follows:
``6253. Replacement; issuance of duplicate medal of honor.''; and
(3) The item relating to section 8747 of such title in the
table of sections at the beginning of chapter 857 of such
title is amended to read as follows:
``8747. Medal of honor; Air Force cross; distinguished-service cross;
distinguished-service medal; silver star: replacement;
issuance of duplicate medal of honor.''.
SEC. 543. REPEAL OF LIMITATION ON AWARD OF BRONZE STAR TO
MEMBERS IN RECEIPT OF SPECIAL PAY.
Section 1133 of title 10, United States Code, is repealed.
Subtitle E--Uniform Code of Military Justice
Sec. 551. Revision of Punitive UCMJ Article Regarding Drunken Operation
of Vehicle, Aircraft, or Vessel.
SEC. 551. REVISION OF PUNITIVE UCMJ ARTICLE REGARDING DRUNKEN
OPERATION OF VEHICLE, AIRCRAFT, OR VESSEL.
(a) Standard for Drunken Operation of Vehicle, Aircraft, or
Vessel.--Paragraph (2) of section 911 of title 10, United
States Code (article III of the Uniform Code of Military
Justice), is amended by striking ``0.10 grams or more of
alcohol'' and inserting ``0.08 grams or more of alcohol''
both places such term appears.
(b) Effective Date.--The amendments made by subsection (a)
shall take effect on the date of the enactment of this Act
and shall apply to offenses committed on or after that date.
TITLE V1--COMPENSATION AND OTHER PERSONNEL BENEFITS
Subtitle A--Pay and Allowances
Sec. 601. Increase in Basic Pay for Fiscal Year 2002.
Sec. 602. Partial Dislocation Allowance Authorized Under Certain
Circumstances.
Sec. 603. Funeral Honors Duty, Allowance for Retirees.
See. 604. Basic Pay Rate for Certain Reserve Commissioned Officers with
Prior Service as an Enlisted Member or Warrant Officer.
Sec. 605. Family Separation Allowance.
Sec. 606. Housing Allowance for the Chaplain for the Corps of Cadets,
United States Military Academy.
Sec. 607. Clarify Amendment that Space-Required Travel for Annual
Training Reserve Duty Does Not Obviate Transportation
Allowances.
SEC. 601. INCREASE IN BASIC PAY FOR FISCAL YEAR 2002.
(a) Waiver of Section 1009 Adjustment.--The adjustment to
become effective during fiscal year 2002 required by section
1009 of title 37, United States Code, in the rates of monthly
basic pay authorized members of the uniformed services shall
not be made.
(b) Increase in Basic Pay.--Effective on January 1, 2002,
the rates of monthly basic pay for members of the uniformed
services shall be as follows:
[[Page S7216]]
MONTHLY BASIC PAY*,**,***
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
YEARS OF SERVICE (COMPUTED UNDER 37 U.S.C. 205)
PAY GRADE --------------------------------------------------------------------------------------------------------------------------------------------------------------------
<2 2 3 4 6 8 10 12 14 16 18 20 22 24 26
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
COMMISSIONED OFFICERS
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
0-10............................................................... 0 0 0 0 0 0 0 0 0 0 0 11601.90 11659.20 11901.30 12324.00
0-9................................................................ 0 0 0 0 0 0 0 0 0 0 0 10147.50 10293.60 10504.80 10873.80
0-8................................................................ 7180.20 7415.40 7571.10 7614.90 7809.30 8135.10 8210.70 8519.70 8608.50 8874.30 9259.50 9614.70 9852.00 9852.00 9852.00
0-7................................................................ 5966.40 6371.70 6371.70 6418.20 6657.90 6840.30 7051.20 7261.80 7472.70 8135.10 8694.90 8694.90 8694.90 8694.90 8738.70
0-6................................................................ 4422.00 4857.90 5176.80 5176.80 5196.60 5418.90 5448.60 5448.60 5628.60 6305.70 6627.00 6948.30 7131.00 7316.10 7675.20
0-5................................................................ 3537.00 4152.60 4440.30 4494.30 4673.10 4673.10 4813.50 5073.30 5413.50 5755.80 5919.00 6079.80 6262.80 6262.80 6262.80
0-4................................................................ 3023.70 3681.90 3927.60 3982.50 4210.50 4395.90 4696.20 4930.20 5092.50 5255.70 5310.60 5310.60 5310.60 5310.60 5310.60
0-3................................................................ 2796.60 3170.40 3421.80 3698.70 3875.70 4070.10 4232.40 4441.20 4549.50 4549.50 4549.50 4549.50 4549.50 4549.50 4549.50
0-2................................................................ 2416.20 2751.90 3169.50 3276.30 3344.10 3344.10 3344.10 3344.10 3344.10 3344.10 3344.10 3344.10 3344.10 3344.10 3344.10
0-1................................................................ 2097.60 2183.10 2638.50 2638.50 2638.50 2638.50 2638.50 2638.50 2638.50 2638.50 2638.50 2638.50 2638.50 2638.50 2638.50
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COMMISSIONED OFFICERS WITH OVER 4 YEARS ACTIVE DUTY SERVICE
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
<2 2 3 4 6 8 10 12 14 16 18 20 22 24 26
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
AS AN ENLISTED MEMBER OR WARRANT OFFICER
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
0-3E............................................................... 0.00 0.00 0.00 3698.70 3875.70 4070.10 4232.40 4441.20 4617.00 4717.50 4855.20 4855.20 4855.20 4855.20 4855.20
0-2E............................................................... 0.00 0.00 0.00 3276.30 3344.10 3450.30 3630.00 3768.90 3872.40 3872.40 3872.40 3872.40 3872.40 3872.40 3872.40
O-IE............................................................... 0.00 0.00 0.00 2638.50 2818.20 2922.30 3028.50 3133.20 3276.30 3276.30 3276.30 3276.30 3276.30 3276.30 3276.30
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WARRANT OFFICERS
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
<2 2 3 4 6 8 10 12 14 16 18 20 22 24 26
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
W-5................................................................ 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 4965.60 5136.00 5307.00 5478.60
W-4................................................................ 2889.60 3108.60 3198.00 3285.90 3437.10 3586.50 3737.70 3885.30 4038.00 4184.40 4334.40 4480.80 4632.60 4782.00 4935.30
W-3................................................................ 2638.80 2862.00 2862.00 2898.90 3017.40 3152.40 3330.90 3439.50 3558.30 3693.90 3828.60 3963.60 4098.30 4233.30 4368.90
W-2................................................................ 2321.40 2454.00 2569.80 2654.10 2726.40 2875.20 2984.40 3093.90 3200.40 3318.00 3438.90 3559.80 3680.10 3801.30 3801.30
W-1................................................................ 2049.90 2217.60 2330.10 2402.70 2511.90 2624.70 2737.80 2850.00 2963.70 3077.10 3189.90 3275.10 3275.10 3275.10 3275.10
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ENLISTED MEMBERS
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
<2 2 3 4 6 8 10 12 14 16 18 20 22 24 26
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
E-9................................................................ 0.00 0.00 0.00 0.00 0.00 0.00 3423.90 3501.30 3599.40 3714.60 3830.40 3944.10 4098.30 4251.30 4467.00
E-8................................................................ 0.00 0.00 0.00 0.00 0.00 2858.10 2940.60 3017.70 3110.10 3210.30 3314.70 3420.30 3573.00 3724.80 3937.80
E-7................................................................ 1986.90 2169.00 2251.50 2332.50 2417.40 2562.90 2645.10 2726.40 2808.00 2892.60 2975.10 3057.30 3200.40 3292.80 3526.80
E-6................................................................ 1701.00 1870,80 1953.60 2033.70 2117.40 2254.50 2337.30 2417.40 2499.30 2558.10 2602.80 2602.80 2602.80 2602.80 2602.80
E-5................................................................ 1561.50 1665,30 1745.70 1828.50 1912.80 2030.10 2110.20 12193.30 2193.30 2193.30 2193.30 2193.30 2193.30 2193.30 2193.30
E-4................................................................ 1443.60 1517.70 1599.60 1680.30 1752.30 1752.30 1752.30 1752.30 1752.30 1752.30 1752.30 1752.30 1752.30 1752.30 1752.30
E-3................................................................ 1303.50 1385.40 1468.50 1468.50 1468.50 1468.50 1468.50 1468.50 1468.50 1468.50 1468.50 1468.50 1468.50 1468.50 1468.50
E-2................................................................ 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30 1239.30
E-1 >4+............................................................ 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50 1105.50
E-1 <4++........................................................... 1022.70 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
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* Basic pay for 0-7 to 0-10 is limited to the rate of basic pay for level III of the Executive Schedule. Basic pay for 0-6 and below is limited to level V of the Executive Schedule.
** While serving as Chairman or Vice Chairman of the Joint Chiefs of Staff, Chief of Staff of the Army, Chief of Naval Operations, Chief of Staff of the Air Force, Commandant of the Marine Corps, or Commandant of the Coast Guard,
basic pay for this grade is $13,598. 10, regardless of cumulative years of service computed under section 205 of title 37, United States Code.
*** While serving as Sergeant Major of the Army, Master Chief Petty Officer of the Navy or Coast Guard, Chief Master Sergeant of the Air Force, or Sergeant Major of the Marine Corps, basic pay for this grade is $5,382.90, regardless
of cumulative years of service computed under section 205 of title 37, United States Code.
+Applies to personnel who have served 4 months or more on active duty.
++Applies to personnel who have served less than 4 months on active duty.
SEC. 602. PARTIAL DISLOCATION ALLOWANCE AUTHORIZED UNDER
CERTAIN CIRCUMSTANCES.
(a) Authorization of Partial Dislocation Allowance.--
Section 407 of title 37, United States Code is amended----
(1) by redesignating subsections (c) through (g) as
subsections (d) through (h), respectively;
(2) in subsections (a)(1) and (b)(1), by striking
``subsection (c)'' and inserting ``subsection (d)'';
(3) by inserting after subsection (b) the following new
subsection:
``(c) Partial Dislocation Allowance.--(1) Under regulations
prescribed by the Secretary concerned, a member ordered to
occupy or to vacate Government family housing for the
convenience of the Government (including pursuant to the
privatization or renovation of housing), and not pursuant to
a permanent change of station, may be paid a partial
dislocation allowance of $500.
``(2) Effective on the same date that the monthly rates of
basic pay for members are increased for a subsequent calendar
year, the Secretary of Defense shall adjust the rate for the
partial dislocation allowance for that calendar year by the
percentage equal to the percentage increase in the rate of
basic pay for that calendar year.
``(3) Payments made under this subsection are not subject
to the fiscal year limitations in subsection (e).''; and
(4) in subsection (d)(1) as redesignated by paragraph (1),
by striking at the beginning ``The amount'' and inserting
``Except as provided in subsection (c), the amount''.
(b) Effective Date.--The amendments made by this section
shall take effect on October 1, 2001.
SEC. 603. FUNERAL HONORS DUTY ALLOWANCE FOR RETIREES.
Section 435 of title 37, United States Code, is amended----
(1) in subsection (a), by inserting before the period at
the end ``or a retired member of the armed forces who
performs at least two hours of duty preparing for or
performing honors at the funeral of a veteran''; and
(2) by adding at the end the following new subsection:
[[Page S7217]]
``(d) Concurrent Payment.--Notwithstanding any other
provision of law, the allowance paid to a retired member of
the armed forces under subsection (a) shall be in addition to
any other compensation authorized under title 10, title 37,
and title 38 to which the retired member may be entitled.''.
SEC. 604. BASIC PAY RATE FOR CERTAIN RESERVE COMMISSIONED
OFFICERS WITH PRIOR SERVICE AS AN ENLISTED
MEMBER OR WARRANT OFFICER.
Section 203(d) of title 37, United States Code, is amended
by inserting ``, or who earns a total of more than 1,460
points credited under section 12732(a)(2) of title 10 while
serving as a warrant officer or as a warrant officer and
enlisted member'' following ``or as a warrant officer and
enlisted member''.
SEC. 605. FAMILY SEPARATION ALLOWANCE.
Section 427(c) of title 37, United States Code, is amended
by amending the first sentence to read as follows:
``A member who elects to serve an unaccompanied tour of
duty because dependent movement to the permanent station is
denied for certified medical reasons is entitled to an
allowance under subsection (a)(1)(A). In all other cases, a
member who elects to serve a tour unaccompanied by his
dependents at a permanent station to which movement of his
dependents is authorized at the expense of the United States
under section 406 of this title is not entitled to an
allowance under subsection (a)(1)(A).''.
SEC. 606. HOUSING ALLOWANCE FOR THE CHAPLAIN FOR THE CORPS OF
CADETS, UNITED STATES MILITARY ACADEMY.
Section 4337 of title 10, United States Code, is amended by
striking the second sentence and inserting ``Notwithstanding
any other provision of law, the chaplain is entitled to the
same basic allowance for housing allowed to a lieutenant
colonel, and to fuel and light for quarters in kind.''.
SEC. 607. CLARIFYING AMENDMENT THAT SPACE-REQUIRED TRAVEL FOR
ANNUAL TRAINING RESERVE DUTY DOES NOT OBVIATE
TRANSPORTATION ALLOWANCES.
Section 18505(a) of title 10, United States Code, is
amended by striking ``annual training duty or'' each time
such term appears.
Subtitle B--Bonuses and Special and Incentive Pays
Sec. 611. Authorize the Secretary of the Navy to Prescribe Submarine
Duty Incentive Pay Rates.
Sec. 612. Extension of Authorities Relating to Payment of Other
Bonuses and Special Pays.
Sec. 613. Extension of Certain Bonuses and Special Pay Authorities for
Nurse Officer Candidates, Registered Nurses, Nurse
Anesthetists, and Dental Officers.
Sec. 614. Extension of Authorities Relating to Nuclear Officer Special
Pays.
Sec. 615. Extension of Special and Incentive Pays.
Sec. 616. Accession Bonus for Officers in Critical Skills.
Sec. 617. Critical Wartime Skill Requirement for Eligibility for the
Individual Ready Reserve Bonus.
Sec. 618. Hazardous Duty Incentive Pay: Maritime Board and Search.
SEC. 611. AUTHORIZE THE SECRETARY OF THE NAVY TO PRESCRIBE
SUBMARINE DUTY INCENTIVE PAY RATES.
(a) In General.--Section 301c of title 37, United States
Code, is amended by striking subsection (b) and inserting the
following:
``(b) A member who meets the requirements prescribed in
subsection (a) is entitled to monthly submarine duty
incentive pay in an amount prescribed by the Secretary of the
Navy, but not more than $1,000 per month.''.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect on October 1, 2002.
SEC. 612. EXTENSION OF AUTHORITIES RELATING TO PAYMENT OF
OTHER BONUSES AND SPECIAL PAYS.
(a) Aviation Officer Retention Bonus.--Section 301b(a) of
title 37, United States Code, is amended by striking
``December 31, 2001'' and inserting ``September 30, 2003''.
(b) Reenlistment Bonus for Active Members.--Section 308(g)
of such title 37 is amended by striking ``December 31, 2001''
and inserting ``September 30, 2003''.
(c) Enlistment Bonus.--Section 309(e) of such title 37 is
amended by striking ``December 31, 2001'' and inserting
``September 30, 2003''.
(d) Retention Bonus for Members Qualified in a Critical
Military Skill.--Section 323(i) of such title 37 is amended
by striking ``December 31, 2001'' and inserting ``September
30, 2003''.
SEC. 613. EXTENSION OF CERTAIN BONUSES AND SPECIAL PAY
AUTHORITIES FOR NURSE OFFICER CANDIDATES,
REGISTERED NURSES, NURSE ANESTHETISTS, AND
DENTAL OFFICERS.
(a) Nurse Officer Candidate Accession Program.--Section
2130a(a)(1) of title 10, United States Code, is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2003''.
(b) Accession Bonus for Registered nurses.--Section
302d(a)(1) of title 37, United States Code, is amended by
striking ``December 31, 2001'' and inserting ``September 30,
2003''.
(C) Incentive Special Pay for Nurse Anesthetists.--Section
302e(a)(1) of such title 37 is amended by striking ``December
31, 2001'' and inserting ``September 30, 2003''.
(d) Accession Bonus for Dental Officers.--Section
302h(a)(1) of such title 37 is amended by striking
``September 30, 2002'' and inserting ``September 30, 2003''.
SEC. 614. EXTENSION OF AUTHORITIES RELATING TO NUCLEAR
OFFICER SPECIAL PAYS.
(a) Special Pay for Nuclear-Qualified Officers Extending
Period of Active Service.--Section 312(e) of title 37, United
States Code, is amended by striking ``December 31, 2001'' and
inserting ``December 31, 2003''.
(b) Nuclear Career Accession Bonus.--Section 312b(c) of
such title 37 is amended by striking ``December 31, 2001''
and inserting ``December 31, 2003''.
(c) Nuclear Career Annual Incentive Bonus.--Section 312c(d)
of such title 37 is amended by striking ``December 31, 2001''
and inserting ``December 31, 2003''.
SEC. 615. EXTENSION OF SPECIAL AND INCENTIVE PAYS.
(a) Special Pay for Reserve Health Professionals in
Critically Short Wartime Specialties.--Section 302g(f) of
title 37, United States Code, is amended by striking
``December 31, 2001'' and inserting ``December 31, 2002''.
(b) Selected Reserve Reenlistment Bonus.--Section 308b(f)
of such title is amended by striking ``December 31, 2001''
and inserting ``December 31, 2002''.
(C) Selected Reserve Enlistment Bonus.--Section 308c(e) of
such title is amended by striking ``December 31, 2001'' and
inserting ``December 31, 2002''.
(d) Special Pay for Enlisted Members Assigned to Certain
High Priority Units.--Section 308d(c) of such title is
amended by striking ``December 31, 2001'' and inserting
``December 31, 2002''.
(e) Selected Reserve Affiliation Bonus.--Section 308e(e) of
such title is amended by striking ``December 31, 2001'' and
inserting ``December 31, 2002''.
(f) Ready Reserve Enlistment and Reenlistment Bonus.--
Section of 308h(g) of such title is amended by striking
``December 31, 2001'' and inserting ``December 31, 2002''.
(g) Prior Service Enlistment Bonus.--Section 308i(f) of
such title is amended by striking ``December 31, 2001'' and
inserting ``December 31, 2002''.
(h) Repayment of Education Loans for Certain Health
Professionals Who Serve in the Selected Reserve.--Section
16302(d) of title 10, United States Code, is amended by
striking ``January 1, 2002'' and inserting ``January 1,
2003''.
SEC. 616. ACCESSION BONUS FOR OFFICERS IN CRITICAL SKILLS.
(a) In General.--Chapter 5 of title 37, United States Code,
is amended by inserting after section 323 the following new
section:
``Sec. 324. Special Pay: officer critical skills accession
bonus
``(a) Accession Bonus Authorized.--Under regulations
prescribed by the Secretary of Defense and the Secretary of
Transportation with respect to the Coast Guard when it is not
operated as a service in the Navy, and subject to the
limitations in subsection (b), an individual who executes a
written agreement to accept a commission as an officer of an
armed force and serve on active duty in an officer critical
skill for the period specified in the agreement may be paid
an accession bonus not to exceed $20,000 upon acceptance of
the written agreement by the Secretary concerned.
``(b) Limitation on Eligibility for Bonus.--An individual
may not be paid a bonus under subsection (a) if the
individual has received, or is receiving, an accession bonus
for the same period of service under subsections 302d, 302h,
or 312b.
``(C) Proration.--The term of an agreement and the amount
of the payment under subsection (a) may be prorated.
``(d) Payment Method.--Upon acceptance of the written
agreement by the Secretary concerned, the total amount
payable pursuant to the agreement under subsection (a)
becomes fixed and may be paid by the Secretary in either a
lump sum or installments.
``(e) Repayment.--(1) If an individual who has entered into
an agreement under subsection (a) has received all or part of
a bonus under this section fails to accept an appointment or
to commence or complete the total period of active duty in
the designated critical skill specified in the agreement, the
Secretary concerned may require the individual to repay the
United States, on a pro rata basis and to the extent that the
Secretary determines conditions and circumstances warrant,
any or all sums paid to the individual under this section.
``(2) An obligation to repay the United States imposed
under paragraph (1) is for all purposes a debt owed to the
United States.
``(3) A discharge in bankruptcy under title II that is
entered less than five years after the termination of a
written agreement entered into. under subsection (a) does not
discharge the individual signing the agreement from a debt
arising under such agreement or under paragraph (1).
``(f) Definition.--In this section, the term ``officer
critical skill'' means a skill designated as critical with
respect to accession of officers to the skill by the
Secretary of Defense, or by the Secretary of Transportation
with respect to the Coast Guard when it is not operating
as a service in the Navy.
``(g) Termination of Bonus Authority.--No bonus may be paid
under this section with respect to any agreement to continue
on active duty in the armed forces entered into after
September 30, 2003, and no agreement under this section may
be entered into after that date.''.
[[Page S7218]]
(b) Clerical Amendment.--The table of sections at the
beginning of chapter 5 of such title 37 is amended by
inserting after the item relating to section 323 the
following new item:
``324. Special Pay: officer critical skills accession bonus.''
SEC. 617. CRITICAL WARTIME SKILL REQUIREMENT FOR ELIGIBILITY
FOR THE INDIVIDUAL READY RESERVE BONUS.
Section 308h(a)(1) of title 37, United States Code, is
amended--
(1) by striking ``a combat or combat support skill of'';
and
(2) by inserting ``is qualified in a skill or specialty
designated by the Secretary concerned as critically short to
meet wartime requirements and'' after ``and who''.
SEC. 618. HAZARDOUS DUTY INCENTIVE PAY: MARITIME BOARD AND
SEARCH.
Section 301(a) of title 37, United States Code, is amended
by inserting after paragraph (11) the following new
paragraph:
``(12) involving regular participation as a member of a
team conducting visit, board, search, and seizure operations
as defined by the Secretary concerned, aboard vessels in
support of maritime interdiction operations as designated by
such Secretary.
Subtitle C--Travel and Transportation Allowances
Sec. 621. Funded Student Travel: Exchange Programs.
Sec. 622. Payment of Vehicle Storage Costs in Advance.
Sec. 623. Travel and Transportation Allowances for Family Members to
Attend the Burial of a Deceased Member of the Armed
Forces.
Sec. 624. Shipment of Privately Owned Vehicles When Executing CONUS
Permanent Change of Station Moves.
SEC. 621. FUNDED STUDENT TRAVEL: EXCHANGE PROGRAMS.
Section 430 of title 37, United States Code, is amended--
(1) in subsection (a)(3), by inserting ``(or a school
outside the United States if the dependent is attending that
school for less than one year under a program approved by the
school in the continental United States at which the
dependent is enrolled)'' after ``United States''; and
(2) in subsection (b)--
(A) in paragraph (1), by inserting ``(or a school outside
the United States if the dependent is attending that school
for less than one year under a program approved by the school
in the continental United States at which the dependent is
enrolled)'' after ``United States'' the first place it
appears; and
(B) by adding at the end the following new subparagraph:
``(3) The transportation allowance under paragraph (1) for
a dependent child who is attending a school outside the
United States for less than one year under a program approved
by the school in the continental United States at which the
dependent is enrolled shall not exceed the allowance the
member would be paid for a trip between the school in the
continental United States and the member's duty station
outside the continental United States and return.''.
SEC. 622. PAYMENT OF VEHICLE STORAGE COSTS IN ADVANCE.
Section 2634(b) of title 10, United States Code, is amended
by adding at the end the following new paragraph:
``(4) Storage costs payable under this subsection may be
paid in advance.''.
SEC. 623. TRAVEL AND TRANSPORTATION ALLOWANCES FOR FAMILY
MEMBERS TO ATTEND THE BURIAL OF A DECEASED
MEMBER OF THE ARMED FORCES.
(a) Consolidation of Authorities.--Section 411f of title
37, United States Code, is amended--
(1) in subsection (a)--
(A) by inserting ``Allowances Authorized.--(1)'' after
``(a)''; and
(B) by inserting at the end following new paragraph:
``(2) If a dependent of a deceased member who is authorized
travel and transportation allowances under this section is
unable to travel unattended to the burial ceremonies of the
deceased member--
``(A) because of--
``(i) age;
``(ii) physical condition; or
``(iii) other justifiable reason, as determined under
uniform regulations prescribed by the Secretaries concerned;
and
``(B) there is no other dependent qualified for travel and
transportation allowances under this section available and
qualified to serve as an attendant for the dependent while
traveling to and attending the burial ceremonies, an
attendant may be paid roundtrip travel and transportation
allowances under this section.'';
(2) in subsection (b)(1)--
(A) by striking ``(b)(1) Except as provided in paragraph
(2)'' and inserting
``(b) Limitation on Allowances.--(l) Except as provided in
paragraphs (2) and (3)''; and
(B) by inserting before the period at the end, the
following: ``and the time necessary for such travel''; and
(3) in subsection (b)(2), by striking ``be extended to
accommodate'' and inserting ``not exceed the rates for 2 days
and'';
(4) by adding at the end of subsection (b) the following
new paragraph:
``(3) If a deceased member is interred in a cemetery
maintained by the American Battle Monuments Commission, the
allowances authorized under this section may be provided to
and from such cemetery and may not exceed the rates for 2
days and time necessary for such travel.''; and
(5) by amending subsection (c) to read as follows:
``(c) Definitions.--(1) In this section, the term
``dependents'' means--
``(A) the surviving spouse (including a remarried surviving
spouse) of the deceased member and any child of the deceased
member as defined in section 401(a)(2);
``(B) if no person described in subparagraph (A) is paid
travel and transportation allowances under this section, the
parents (as defined in section 401(b)(2)) of the deceased
member; or
``(C) if no person described in subparagraphs (A) or (B) is
paid travel and transportation allowances under this section,
then--
``(i) the person who directs the disposition of the remains
of the deceased member under section 1482(c) of 74 title 10,
United States Code, and two additional persons selected by
that person who are closely related to the deceased member;
or
``(ii) in the case of a deceased member whose remains are
commingled and buried in a common grave in a national
cemetery, the person who would have been designated under
section 1482(c) of such title to direct the disposition of
the remains if individual identification had been made and
two additional persons selected by that person who are
closely related to the deceased member.
``(2) In this section, the term ``burial ceremonies''
includes--
``(A) an interment of casketed or cremated remains;
``(B) a placement of cremated remains in a columbarium:
``(C) a memorial service for which reimbursement is
authorized under section 1482(e)(2) of title 10; and
``(D) a burial of commingled remains that cannot be
individually identified in a common grave in a national
cemetery.''.
(b) Conforming Amendments.--(1) Section 1482 of title 10,
United States Code, is amended by striking subsection (d) and
redesignating subsections (e), (f), and (g) as subsections
(d), (e), and (f), respectively.
(2) The Funeral Transportation and Living Expense Benefits
Act of 1974 (37 U.S.C. 406 note; Public Law 93-257) is
repealed.
SEC. 624. SHIPMENT OF PRIVATELY OWNED VEHICLES WHEN EXECUTING
CONUS PERMANENT CHANGE OF STATION MOVES.
Section 2634(h)(1) of title 10, United States Code, is
amended by inserting before the period at the end ``, or when
the Secretary concerned determines that the transport of a
vehicle upon transfer is advantageous and cost-effective to
the government''.
Subtitle D--Other
Sec. 631. Montgomery GI Bill-Selected Reserve Eligibility Period.
Sec. 632. Improved Disability Benefits for Certain Reserve Component
Members.
Sec. 633. Acceptance of Scholarships by Officers Participating in the
Funded Legal Education Program.
SEC. 631. MONTGOMERY GI BILL--SELECTED RESERVE ELIGIBILITY
PERIOD.
Section 16133(a) of title 10, United States Code, is
amended by striking `` 10-year'' and inserting ``14-year''.
SEC. 632. IMPROVED DISABILITY BENEFITS FOR CERTAIN RESERVE
COMPONENT MEMBERS.
(a) Medical and Dental Care for Members.--Section
1074a(a)(3) of title 10, United States Code, is amended by
inserting before the period: ``, or if otherwise authorized
under applicable regulations''.
(b) Medical and Dental Care for Dependents.--Section
1076(a)(2)(C) of such title 10 is amended by inserting before
the period: ``, or if otherwise authorized under applicable
regulations''.
(c) Eligility for Disability Retirement or Separation.--(1)
Section 1204(2)(B)(iii) of such title 10 is amended by
inserting before the semicolon: ``, or if otherwise
authorized under applicable regulations''.
(2) Section 1206(2)(C) of such title 10 is amended by
inserting before the semicolon: ``, or if otherwise
authorized under applicable regulations''.
(d) Recovery, Care, and Disposition of Remains.--Section
1481(a)(2)(D) of such title 10 is amended by inserting before
the semicolon: ``, or if otherwise authorized under
applicable regulations''.
(e) Entitlement to Basic Pay.--(l) Section 204(g)(1)(D) of
title 37, United States Code, is amended by inserting before
the period: ``, or if otherwise authorized under applicable
regulations''.
(2) Section 204(h)(1)(D) of title such 37 is amended by
inserting before the period: ``, or if otherwise authorized
under applicable regulations''.
(f) Compensation for Inactive-Duty Training.--Section
206(a)(3)(C) of such title 37 is amended by inserting before
the period: ``, or if otherwise authorized under applicable
regulations''.
SEC. 633. ACCEPTANCE OF SCHOLARSHIPS BY OFFICERS
PARTICIPATING IN THE FUNDED LEGAL EDUCATION
PROGRAM.
(a) Acceptance of Scholarship.--Section 2004 of title 10,
United States Code, is amended by adding at the end the
following new subsection:
[[Page S7219]]
``(g) An officer detailed at a law school under this
section also may accept a fellowship, scholarship, or grant
under section 2603 of this title. Any service obligation
incurred under section 2603 shall be served consecutively
with the service obligation incurred under subsection
(b)(2)(C).''.
(b) Conforming Amendment.--Section 2603 of such title 10 is
amended by adding at the end the following new subsection:
``(c) A member who accepts a fellowship, scholarship, or
grant in accordance with subsection (a) also may be detailed
at a law school under section 2004 of this title. Any service
obligation incurred under section 2004 shall be served
consecutively with the service obligation incurred under
subsection (b).''.
TITLE VII--ACQUISITION POLICY AND ACQUISITION MANAGEMENT
Subtitle A--Acquisition Policy
Sec. 701. Acquisition Milestone Changes.
Sec. 702. Clarification of Inapplicability of the Requirement for Core
Logistics Capabilities Standards to the Nuclear Refueling
of an Aircraft Carrier.
Sec. 703. Depot Maintenance Utilization Waiver.
SEC. 701. ACQUISITION MILESTONE CHANGES.
(a) System Development and Demonstration.--Section 2366(c)
of title 10, United States Code, is amended--
(1) in paragraph (1) by striking ``engineering and
manufacturing development'' and inserting ``system
development and demonstration''; and
(2) in paragraph (2) by striking ``engineering and
manufacturing development'' and inserting ``system
development and demonstration''.
(b) Milestone B.--Section 2400 of title 10, United States
Code, is amended--
(1) in subsections (a)(1)(A), (a)(2), (a)(4) and (a)(5), by
striking ``milestone II'' each place it appears and inserting
``milestone B.''.
(2) in subsection (a)(2), by striking ``engineering and
manufacturing development'' and inserting ``system
development and demonstration.''.
(c) System Development and Demonstration.--Section 2432 of
title 10, United States Code, is amended in subsections
(b)(3)(A), (c)(3)(A) and (h)(1), by striking ``engineering
and manufacturing development'' each place it appears and
inserting ``system development and demonstration.''.
(d) Section 2434 of title 10, United States Code, is
amended in subsection (a), by striking ``engineering and
manufacturing development'' and inserting ``system
development and demonstration.''.
(e) System Development and Demonstration and Full Rate
Production.--Section 2435 of Title 10, United States Code, is
amended--
(1) in subsection (b) by striking ``engineering and
manufacturing development'' and inserting ``system
development and demonstration.''
(2) in subsection (c)(1), by striking ``demonstration and
validation'' and inserting ``system development and
demonstration.''
(3) in subsection (c)(2) by striking ``engineering and
manufacturing development'' and inserting ``production and
deployment.''
(4) in subsection (c)(3) by striking ``production and
deployment `` and inserting ``full rate production.''--
(f) Milestone Designators.--Section 8102(b) of Public Law
106-259 is amended--
(1) by striking ``milestone I'' and inserting ``milestone
B.''
(2) by striking ``milestone II'' and inserting ``milestone
C.''
(3) by striking ``milestone III'' and inserting ``full rate
production.''.
(g) Milestone Designators.--Section 81l(c) of Public Law
106-398, is amended--
(1) by striking ``Milestone I'' and inserting ``Milestone
B.''
(2) by striking ``Milestone II'' and inserting ``Milestone
C.''
(3) by striking ``Milestone III'' and inserting ``full rate
production''.
SEC. 702. CLARIFICATION OF INAPPLICABILITY OF THE REQUIREMENT
FOR CORE LOGISTICS CAPABILITIES STANDARDS TO
THE NUCLEAR REFUELING OF AN AIRCRAFT CARRIER.
Section 2464(a)(3) of title 10, United States Code, is
amended--
(1) by striking ``nuclear aircraft carriers,''; and
(2) by adding at the end the following new sentence:
``Core logistics capabilities identified under paragraphs (1)
and (2) shall not include nuclear refueling of an aircraft
carrier.''.
SEC. 703. DEPOT MAINTENANCE UTILIZATION WAIVER.
Section 2466(c) of title 10, United States Code, is amended
by striking ``the waiver is'' and inserting ``a depot is
fully utilized within existing resources and, where multiple
depots are capable of performing the same maintenance
activities that the utilization of another such depot is
uneconomical, or that the waiver is otherwise''.
Subtitle B--Acquisition Workforce
Sec. 705. Acquisition Workforce Qualifications.
See. 706. Tenure Requirement for Critical Acquisition Positions.
SEC. 705. ACQUISITION WORKFORCE QUALIFICATIONS.
(a) Amendments to Authority.--Section 1724 of title 10,
United States Code, is Amnended--
(1) in subsection (a)--
(A) by striking ``(a) Contracting Officers.--The Secretary
of Defense shall require that in order to qualify to serve in
an acquisition position as a contracting officer with
authority to award or administer contracts for amounts above
the simplified acquisition threshold referred to in section
2304(g) of this title, a person must (except as provided in
subsections (e) and (d))--'' and inserting ``(a) Contracting
Officers.--The Secretary of Defense shall require that, with
the exception of the Contingency Contracting Force
identified in paragraph (c), in order to qualify to serve
in an acquisition position as a contracting officer with
authority to award or administer contracts for amounts
above the simplified acquisition threshold referred to in
section 2304(g) of this title, a person must (except as
provided in subsections (e) and (f))--''; and
(B) in paragraph (3)(A), by inserting a comma between
``business'' and ``finance'';
(2) by striking subsections (c) and (d); and
(3) by inserting after subsection (b) the following new
subsections:
``(c) Contingency Contracting Force.--(1) Notwithstanding
subsections (a) and (b), the Secretary of Defense may
establish a Contingency Contracting Force consisting of
employees and members of the armed forces whose mission, as
determined by the Secretary, is to deploy in support of
contingency operations and other Department of Defense
operations.
``(2) The Secretary of Defense shall establish
qualification requirements for such Contingency Contracting
Force, to include--
``(A) completion of at least 24 semester credit hours (or
the equivalent) of study from an accredited institution of
higher education, or similar educational institution as
determined by the Secretary, in any of the following
disciplines: accounting, business finance, law, contracts,
purchasing, economics, industrial management, marketing,
quantitative methods, and organization and management;
``(B) passing an examination considered by the Secretary of
Defense to demonstrate skills, knowledge, or abilities
comparable to that of an individual who has completed at
least 24 semester credit hours (or the equivalent) of study
in any of the disciplines listed in subparagraph (A); or
``(C) any combination of (A) and (B) equaling 24 semester
hours or the equivalent as determined by the Secretary; and
``(D) such additional education and experience requirements
as the Secretary may prescribe.
``(d) Developnental Opportunities.--Not withstanding other
provisions of law, the Secretary of Defense may establish one
or more programs for the purpose of recruiting, selecting,
appointing, educating, qualifing, and developing the careers
of personnel to meet the requirements in subparagraphs (A)
and (B) of subsection (a)(3) above for contracting positions
in the Department of Defense covered by this section; may
appoint individuals to developmental positions in those
programs; and may separate from the civil service any person
appointed under this subsection who, as determined by the
Secretary, fails to complete satisfactorily any program
developed pursuant to this subsection. To qualify for any
developmental program under this subsection, an individual
must have met one of the following requirements:
``(1) Been awarded a baccalaureate degree from an
accredited educational institution authorized to grant
baccalaureate degrees.
``(2) Completed at least 24 semester credit hours (or the
equivalent) of study from an accredited institution of higher
education in any of the disciplines of accounting, business
finance, law, contracts, purchasing, economics, industrial
management, marketing, quantitative methods, and organization
and management.
``(e) Exception.--(1) The requirements imposed under
subsection (a) or (b) shall not apply to an employee or
member who--
``(A) served as a contracting officer with authority to
award or administer contracts in excess of the simplified
acquisition threshold in the Executive agency on or before
September 30, 2000;
``(B) served, on or before September 30, 2000, in a
position in an Executive agency either as an employee in the
GS-1102 series or as a member of the armed force in similar
occupational specialty; or
``(C) is determined by the Secretary of Defense to be a
member of the Contingency Contracting Force.
``(2) The requirements imposed under subsection (a) or (b)
of this section shall not apply to an employee for purposes
of qualifying to serve in the position in which the employee
was serving on October 1, 1993, or any other position in the
same or lower grade and involving the same or lower level of
responsibilities as the position in which the employee was
serving on such date.
``(3) To qualify for the exceptions in subparagraphs (A) or
(B) of paragraph (1) of this subsection, a civilian employee
must have met one of the following requirements, or have been
granted a waiver under subsection (f), on or before September
30, 2000--
``(A) received a baccalaureate degree from an accredited
educational institution authorized to grant baccalaureate
degrees;
``(B) completed at least 24 semester credit hours. (or the
equivalent) of study from an accredited institution of higher
education in any of the following disciplines: accounting,
business finance, law, contracts, purchasing,
[[Page S7220]]
economics, industrial management, marketing, quantitative
methods, and organization and management;
``(C) passed an examination considered by the Secretary of
Defense to demonstrate skills, knowledge, or abilities
comparable to that of an individual who has completed at
least 24 semester credit hours (or the equivalent) of study
in any of the disciplines listed in subparagraph (B); or
``(D) on October 1, 1991, had at least 10 years of
experience in acquisition positions, in comparable positions
in other government agencies or the private sector, or in
similar positions in which an individual obtains experience
directly relevant to the field of contracting.
``(f) Waiver.--The acquisition career program board
concerned may waive any or all of the requirements of
subsections (a) and (b) with respect to an individual if the
board certifies that the individual possesses significant
potential for advancement to levels of greater responsibility
and authority, based on demonstrated job performance and
qualifying experience. With respect to each waiver granted
under this subsection, the board shall set forth in a written
document the rationale for its decision to waive such
requirements. The document shall be submitted to and retained
by the Director of Acquisition Education, Training, and
Career Development.''.
(b) Clerical Amendment.--Section 1732(c)(2) of such title
10 is amended by inserting a comma between ``business'' and
``finance''.
SEC. 706. TENURE REQUIREMENT FOR CRITICAL ACQUISITION
POSITIONS.
Section 1734 of title 10, United States Code, is amended--
(1) in paragraph (a)(1), by inserting ``as a program
manager, deputy program manager, or senior contracting
official of a major system, as that term is defined in
section 23 02(5) of this title, and any person assigned to
such other critical acquisition position as the Secretary of
Defense may prescribe by regulation,'' after ``critical
acquisition position''.
(2) in paragraph (a)(2), by inserting ``as a program
manager, deputy program manager, or senior contracting
official of a major system, as that term is defined in
section 2302(5) of this title, and any person assigned to
such other critical acquisition position as the Secretary
of Defense may prescribe by regulation,'' after ``critical
acquisition position''.
Subtitle C--General Contracting Procedures and Limitations
Sec. 710. Amendment of Law Applicable to Contracts for Architectural
and Engineering Services and Construction Design.
Sec. 711. Streamlining Procedures for the Purchase of Certain Goods.
Sec. 712. Repeat of the Requirement for the Limitations on the Use of
Air Force Civil Engineering Supply Function Contracts.
Sec. 713. One-Year Extension of Commercial Items Test Program.
Sec. 714. Modification of Limitation on Retirement or Dismantlement of
Strategic Nuclear Delivery Systems.
SEC. 710. AMENDMENT OF LAW APPLICABLE TO CONTRACTS FOR
ARCHITECTURAL AND ENGINEERING SERVICES AND
CONSTRUCTION DESIGN.
Section 2855 of title 10, United States Code, is amended--
(1) in subsection (a) by striking the subsection designator
``(a)''; and
(2) by striking subsection (b).
SEC. 711. STREAMLINING PROCEDURES FOR THE PURCHASE OF CERTAIN
GOODS.
Section 2534(g)(2) of title 10, United States Code, is
amended by inserting before the period at the end: ``unless
the head of a contracting activity determines--
``(A) that the amount of the purchase is $25,000 or less;
``(B) the precision level of the ball or roller bearings is
rated lower than Annual Bearing Engineering Committee (ABEC)
5 or Roller Bearing Engineering Committee (RBEC) 5, or their
equivalent;
``(C) at least two manufacturers in the national technology
and industrial base capable of producing the ball or roller
bearings decline to respond to a request for quotation for
the required items; and
``(D) the bearings are neither miniature nor instrument
ball bearings, i.e. rolling contact ball bearings with a
basic outside diameter (exclusive of flange diameters) of 30
millimeters or less.''.
SEC. 712. REPEAL OF THE REQUIREMENT FOR LIMITATIONS ON THE
USE OF AIR FORCE CIVIL ENGINEERING SUPPLY
FUNCTION CONTRACTS.
Section 345 of the National Defense Authorization Act for
Fiscal Year 1999 (Public Law 105-261, 112 Stat. 1978) is
repealed.
SEC. 713. ONE-YEAR EXTENSION OF COMMERCIAL ITEMS TEST
PROGRAM.
Section 4202(e) of the National Defense Authorization Act
for Fiscal Year 1996 (Public Law 104-106; 110 Stat. 184, 652
is amended by striking ``January 1, 2002'' and inserting
``January 1, 2003.''.
SEC. 714. MODIFICATION OF LIMITATION ON RETIREMENT OR
DISMANTLEMENT OF STRATEGIC NUCLEAR DELIVERY
SYSTEMS.
Section 1302(a) of the National Defense Authorization Act
for Fiscal Year 1998 (Public Law 105-85; 111 Stat. 1948), as
amended by section 1501 (a) of the National Defense
Authorization Act for Fiscal Year 2000 (Public Law 106-65;
113 Stat. 806), is further amended by striking paragraph
(1)(D).
Subtitle D--Military Construction General Provisions
Sec. 715. Exclusion of Unforeseen Environmental Hazard Remediation from
the Limitation on Cost Increases for Military
Construction and Family Housing Construction Projects.
Sec. 716. Increase of Overseas Minor Construction Threshold Using
Operations and Maintenance Funds.
Sec. 717. Leasebacks of Base Closure Property.
Sec. 718. Alternative Authority For Acquisition and Improvement of
Military Housing.
Sec. 719. Annual Report to Congress on Design And Construction.
SEC. 715. EXCLUSION OF UNFORESEEN ENVIRONMENTAL HAZARD
REMEDIATION FROM THE LIMITATION ON COST
INCREASES FOR MILITARY CONSTRUCTION AND FAMILY
HOUSING CONSTRUCTION PROJECTS.
Subsection 2853(d) of title 10, United States Code, is
amended--
(1) by inserting ``(1)'' immediately following ``apply
to''; and
(2) by inserting immediately before the period at the end
``; or (2) the costs associated with environmental hazard
remediation such as asbestos removal, radon abatement, lead-
based paint removal or abatement, and any other legally
required environmental hazard remediation, provided that such
remediation requirements could not be reasonably anticipated
at the time of budget submission''.
SEC. 716. INCREASE OF OVERSEAS MINOR CONSTRUCTION THRESHOLD
USING OPERATIONS AND MAINTENANCE FUNDS.
Section 2805 of title 10, United States Code, amended--
(1) in subsection (b)(1), by striking ``$500,000'' and
inserting ``$750,000'';
(2) in subsection (c)(1)(A), by striking ``$1,000,000'' and
inserting ``$1,500,000''; and
(3) in subsection (c)(1)(B), by striking ``$500,000'' and
inserting ``$750,000''.
SEC. 717. LEASEBACKS OF BASE CLOSURE PROPERTY.
(a) 1990 Law.--Section 2905(b)(4)(E) of the Defense Base
Closure and Realignment Act of 1990 (part A of title XXIX of
Public Law 101-510; 10 U.S.C. 2687 note) is amended as
follows:
(1) in clause (iii), by striking ``A'' and inserting
``Except as provided in clause (v) below, a''
(2) by adding at the end the following new clause (v):
``(v) Notwithstanding clause (iii) or chapter 137 of title
10, United States Code, where the department or agency
concerned leases a substantial portion of the installation,
the department or agency may obtain, at a rate no higher than
that charged to non-Federal tenants, facility services for
the leased property and common area maintenance from the
redevelopment authority or the redevelopment authority's
assignee as a provision of a lease under clause (i). Facility
services and common area maintenance shall not include
municipal services that the state or local government is
required by law to provide to all landowners in its
jurisdiction without direct charge, or firefighting or
security-guard functions.''.
(b) 1988 Law.--Section 204(b)(4) of the Defense
Authorization Amendments and Base Closure and Realignment Act
of (Public Law 100-526; 10 U.S.C. 2687 note) is amended by
adding at the end the following new subparagraph (J):
``(J)(i) The Secretary may transfer real property at an
installation approved for closure or realignment under this
title (including property at an installation approved for
realignment which will be retained by the Department of
Defense or another Federal agency after realignment) to the
redevelopment authority for the installation if the
redevelopment authority agrees to lease, directly upon
transfer, one or more portions of the property transferred
under this subparagraph to the Secretary or to the head of
another department or agency of the Federal Government.
Subparagraph (B) shall apply to a transfer under this
subparagraph.
``(ii) A lease under clause (i) shall be for a term of not
to exceed 50 years, but may provide for options for renewal
or extension of the term by the department or agency
concerned.
``(iii) Except as provided in clause (v) below, a lease
under clause (i) may not require rental payments by the
United States.
``(iv) A lease under clause (i) shall include a provision
specifying that if the department or agency concerned ceases
requiring the use of the leased property before the
expiration of the term of the lease, the remainder of the
lease term may be satisfied by the same or another department
or agency of the Federal Government using the property for a
use similar to the use under the lease. Exercise of the
authority provided by this clause shall be made in
consultation with the redevelopment authority concerned.
``(v) Notwithstanding clause (iii) or chapter 137 of title
10, United States Code, where the department or agency
concerned leases a substantial portion of the installation,
the department or agency may obtain, at a rate no higher than
that charged to non-Federal tenants, facility services for
the leased property and common area maintenance from the
redevelopment authority or the redevelopment authority's
assignee as a provision of a lease under clause (i). Facility
services and common area maintenance shall not include
[[Page S7221]]
municipal services that the state or local government is
required by law to provide to all landowners in its
jurisdiction without direct charge, or firefighting or
security-guard functions.''.
SEC. 718. ALTERNATIVE AUTHORITY FOR ACQUISITION AND
IMPROVEMENT OF MILITARY HOUSING.
(a) In General.--Subchapter IV of Chapter 169 of title 10,
United States Code, is amended by adding at the end the
following new section:
``Sec. 2886. Reimbursement of funds related to the execution
of military family housing privatization projects
``The Secretary of Defense may, during the first year of an
initiative under this Subchapter, transfer funds from
appropriations available for the operation and maintenance of
family housing to appropriations available for the pay of
military personnel in such amounts as are necessary to offset
additional housing allowance costs incurred as a result of
such initiative.''.
(b) Clerical Amendment.--The table of sections at the
beginning of such subchapter IV of chapter 169 of title 10 is
amended by inserting after the item relating to section 2885
the following:
``2886. Reimbursement of funds related to the execution of military
family housing privatization projects.''.
SEC. 719. ANNUAL REPORT TO CONGRESS ON DESIGN AND
CONSTRUCTION.
(a) In General.--Section 2861 of title 10, United States
Code is repealed.
(b) Clerical Amendment.--The table of sections at the
beginning of subchapter III of chapter 169 of such title 10
is amended by striking the item referring to section 2861.
TITLE VIII--DEPARTMENT OF DEFENSE ORGANIZATION AND POSITIONS
Subtitle A--Department of Defense Organizations and Positions
Sec. 801. Organizational Alignment Change for Director for
Expeditionary Warfare.
Sec. 802. Consolidation of Authorities Relating to Department of
Defense Regional Centers for Security Studies.
Sec. 803. Change of Name for Air Mobility Command.
Sec. 804. Transfer of intelligence Positions in Support of the National
Imagery and Mapping Agency.
SEC. 801. ORGANIZATIONAL ALIGNMENT CHANGE FOR DIRECTOR FOR
EXPEDITIONARY WARFARE.
Section 5038(a) of title 10, United States Code, is amended
by striking ``Office of the Deputy Chief of Naval Operations
for Resources, Warfare Requirements, and Assessments'' and
inserting ``Office of the Deputy Chief of Naval Operations
for Warfare Requirements and Programs''.
SEC. 802. CONSOLIDATION OF AUTHORITIES RELATING TO DEPARTMENT
OF DEFENSE REGIONAL CENTERS FOR SECURITY
STUDIES.
(a) In General.--Chapter 6 of title 10, United States Code,
is amended, by adding at the end the following new section:
``Sec. 169. Regional centers for security studies
``(a) Authority To Establish, Operate and Terminate
Regional Centers.--The Secretary of Defense may establish,
operate and terminate regional centers for security studies
to serve as forums for bilateral and multilateral
communication and military and civilian exchanges. Such
regional centers shall use professional military education,
civilian defense education, and related academic and other
activities, as the Secretary deems appropriate, to pursue
such communication and exchanges. The Secretary of Defense
annually, in writing, shall evaluate the performance and
value to the United States of each such regional center and
determine whether to continue to operate such regional
center.
``(b) Acceptance of Gifts and Contributions.--The Secretary
may accept, hold, administer, and use gifts and contributions
of money, personal property (including loans of property),
and services for the purpose of defraying the costs or
enhancing the operations of one or more of the Regional
Centers, and may pay all reasonable expenses in connection
with the conveyance or transfer of any such gifts.
Contributions of money and proceeds from the sale of property
accepted by the Secretary under this subsection shall be
credited to funds available for the operation or support of
the Center or Centers intended to benefit from such
contribution and shall remain available until expended. No
gift or contribution may be accepted under this subsection
from a foreign state, or instrumentality or national thereof,
or organization domiciled therein, nor anyone acting on
behalf of any of them.
``(c) Limitation.--The Secretary may not accept a gift or
donation under subsection (b) if the acceptance of the gift
or donation would compromise or appear to compromise--
``(1) the ability of the Department of Defense, any
employee of the Department or members of the armed forces to
carry out the responsibility or duty of the Department in a
fair and objective manner; or
``(2) the integrity of any program of the Department of
Defense or any person involved in such a program.
``(d) Administration.--The Secretary may take the following
actions in furtherance of the mission of Regional Centers
operated under this section:
``(1) Employment and compensation of faculty and staff.--
Notwithstanding the provisions of title 5, United States
Code, regarding appointment, pay and classification, the
Secretary may employ such civilian directors, faculty and
staff members for Regional Centers operated under this
section as the Secretary determines necessary.
``(2) Waiver of costs.--The Secretary may waive
reimbursement of the cost of conferences, seminars, courses
of instruction or similar educational activities of such
Regional Centers for foreign participants if the Secretary
determines that attendance of such personnel without
reimbursement is in the national security interests of the
United States.
``(3) Payment of expenses.--In addition to waiver of
reimbursement of costs described in paragraph (2), the
Secretary of Defense may pay the travel, subsistence, and
similar personal expenses of foreign participants in
connection with the attendance of such personnel at
conferences, seminars, courses of instruction, or similar
educational activities of such Regional Centers if the
Secretary determines that payment of such expenses is in the
national security interest of the United States.
``(e) Report to Congress.--The Secretary shall report
annually to the appropriate committees of Congress on the
status, objectives, operations and foreign participation of
the Regional Centers.
``(f) Definitions.--In this section:
``(1) The term `Appropriate committees of Congress' means
the Committees on Armed Services of the Senate and of the
House of Representatives.
``(2) The term `Contribution' means a contribution, gift or
donation of funds, materials (including research materials),
property or services (including lecture services and faculty
services), but does not include a contribution made pursuant
to chapter 138 of this title.''.
(b) Conforming Amendments.--(1) Section 1306 of the
National Defense Authorization Act for Fiscal Year 1995,
(Public Law 103-337; 108 Stat. 2892) is repealed.
(2) Section 1065 of the National Defense Authorization Act
for Fiscal Year 1997, (Public Law 104-201; 110 Stat. 2653) is
amended as follows--
(A) by striking subsections (a) and (b); and
(B) by striking the subsection designator ``(c)''.
(3) Section 1595 of title 10, United States Code, is
amended as follows--
(A) in subsection (c), by striking paragraphs (3) and (5);
(B) by redesignating subparagraph (c)(4) as subparagraph
(c)(3); and
(C) by striking subsection (e).
(4) Section 2611 of title 10, United States Code, is
repealed.
(c) Clerical Amendments.--(1) The table of sections at the
beginning of chapter 155 of such title 10 is amended by
striking the item relating to section 2611; and
(2) The table of sections at the beginning of chapter 6 of
such title 10 is amended, by adding at the end the following
new item:
``169. Regional Centers for Security Studies''.
SEC. 803. CHANGE OF NAME FOR AIR MOBILITY COMMAND.
(a) Section 2544(d) of title 10, United States Code, is
amended by striking ``Military Airlift Command'' and
inserting ``Air Mobility Command''.
(b) Section 2545(a) of such title 10 is amended by striking
``Military Airlift Command'' and inserting ``Air Mobility
Command''.
(c) Section 8074 of such title 10 is amended by striking
subsection (c).
(d) Section 430(c) of title 37, United States Code, is
amended by striking ``Military Airlift Command'' and
inserting ``Air Mobility Command''.
(e) Section 432(b) of such title 37 is amended by striking
``Military Airlift Command'' and inserting ``Air Mobility
Command''.
SEC. 804. TRANSFER OF INTELLIGENCE POSITIONS IN SUPPORT OF
THE NATIONAL IMAGERY AND MAPPING AGENCY.
Section 1606 of title 10, United States Code, is amended by
striking ``517'' and inserting ``544''.
Subtitle B--Reports
Sec. 811. Amendment to National Guard and Reserve Component Equipment:
Annual Report to Congress.
Sec. 812. Elimination of Triennial Report on the Roles and Missions of
the Armed Forces.
Sec. 813. Change in Due Date of Commercial Activities Report.
SEC. 811. AMENDMENT TO NATIONAL GUARD AND RESERVE COMPONENT
EQUIPMENT: ANNUAL REPORT TO CONGRESS.
Section 10541 of title 10, United States Code, is amended
to read as follows:
``(a) The Secretary of Defense shall submit to the Congress
each year, not later than March 1, a written report
concerning the equipment of the National Guard and the
Reserve components of the armed forces, to include the U.S.
Coast Guard Reserve. This report shall cover the current
fiscal year and three succeeding years. The focus should be
on major items of equipment which address large dollar-value
requirements, critical Reserve component shortages and major
procurement items. Specific major items of equipment shall
include ships, aircraft, combat vehicles and key combat
support equipment.
``(b) Each annual report under this section should include
the following:
``(1) Major items of equipment required and on-hand in the
inventories of each Reserve component.
[[Page S7222]]
``(2) Major items of equipment which are expected to be
procured from commercial sources or transferred from the
Active component to the Reserve components of each Service.
``(3) Major items of equipment in the inventories of each
Reserve component which are substitutes for a required major
item of equipment.
``(4) A narrative explanation of the plan of the Secretary
concerned to equip each Reserve component, including an
explanation of the plan to equip units of the Reserve
components that are short major items of equipment at the
outset of war or a contingency operation.
``(5) A narrative discussing the current status of the
compatibility and interoperability of equipment between the
Reserve components and the active forces, the effect of that
level of compatibility or interoperability on combat
effectiveness, and a plan to achieve full equipment
compatibility and interoperability.
``(6) A narrative discussing modernization shortfalls and
maintenance backlogs within the Reserve components and the
effect of those shortfalls on combat effectiveness.
``(7) A narrative discussing the overall age and condition
of equipment currently in the inventory of each Reserve
component.
``(c) Each report under this section shall be expressed in
the same format and with the same level of detail as the
information presented in the Future Years Defense Program
Procurement Annex prepared by the Department of Defense.''.
SEC. 812. ELIMINATION OF TRIENNIAL REPORT ON THE ROLES AND
MISSIONS OF THE ARMED FORCES.
(a) Repeal of Requirement for Report on Assignment of Roles
and Missions.--Section 153 of title 10, United States Code,
is amended--
(1) in subsection (a), by striking the catchline and
section designator ``(a) Planning; Advice; Policy
Formulation.--``; and
(2) by striking subsection (b).
(b) Roles and Missions as Part of Defense Quadrennial
Review.--Subsection 118(e) of such title 10 is amended by
inserting after the first sentence the following two new
sentences: ``The Chairman shall also include his assessment
of the assignment of functions (or roles and missions) to the
Armed Forces and recommendations for change the Chairman
considers necessary to achieve the maximum efficiency of the
Armed Forces. This roles and missions assessment should
consider the unnecessary duplication of effort among the
armed forces and changes in technology that can be applied
effectively to warfare.''.
SEC. 813. CHANGE IN DUE DATE OF COMMERCIAL ACTIVITIES REPORT.
Section 2461(g), title 10, United States Code is amended by
striking ``February 1'' and inserting ``June 30''.
Subtitle C--Other Matters
Sec. 821. Documents, Historical Artifacts, and Obsolete or Surplus
Materiel: Loan, Donation, or Exchange.
Sec. 822. Charter Air Transportation of Members of the Armed Forces.
SEC. 821. DOCUMENTS, HISTORICAL ARTIFACTS, AND OBSOLETE OR
SURPLUS MATERIEL: LOAN, DONATION, OR EXCHANGE.
(a) In General.--Section 2572 of title 10, United States
Code, is amended--
(1) in subsection (a), by striking ``subsection (c)'' and
inserting ``subsection (c)(1)'';
(2) in subsection (b), by striking ``subsection (c)'' and
inserting ``subsection (c)(2)''; and
(3) in subsection (c)--
(A) by striking ``(c) This section'' and inserting ``(c)(1)
Subsection (a)''; and
(B) by adding at the end the following new paragraph:
``(2) Subsection (b) applies to the following types of
property held by a military department or the Coast Guard:
books, manuscripts, works of art, historical artifacts,
drawings, plans, models, and obsolete or surplus materiel.''.
(b) Conforming Amendment.--The heading of such section is
amended by striking ``condemned or obsolete combat'' and
inserting ``obsolete or surplus''.
SEC. 822. CHARTER AIR TRANSPORTATION OF MEMEBERS OF THE ARMED
FORCES.
Section 2640 of title 10, United States Code, is amended--
(1) in subsection (a)(1)(A), by striking ``an'' after
``contract with'' and inserting ``a domestic or foreign'';
(2) in subsection (b)(5), by striking ``check-rides'' and
inserting ``cockpit safety observations'';
(3) in subsection (e), by striking ``Military Airlift
Command'' and inserting ``Air Mobility Command'';
(4) in subsection (g), by striking ``in an emergency''; and
(5) in subsection (j)(1), by striking ``air carrier,''
TITLE IX--GENERAL PROVISIONS
Subtitle A--Matters Relating to Other Nations
Sec. 901. Test and Evaluation Initiatives.
Sec. 902. Cooperative Research and Development Projects: Allied
Countries.
Sec. 903. Recognition of Assistance from Foreign Nationals.
Sec. 904. Personal Service Contracts in Foreign Areas.
SEC. 901. TESTS AND EVALUATION INITIATIVES.
(a) Authority To Engage in Cooperative Tests and Evaluation
at U.S. and Foreign Ranges and Other Facilities Where Testing
May Be Conducted.--Chapter 138 of title 10, United States
Code, is amended by adding at the end the following new
section:
``Sec. 23501. Agreements for the cooperative use of ranges
and other facilities where testing may be conducted
``(a) Authority To Enter Into International Agreements.--
The Secretary of Defense, with the concurrence of the
Secretary of State, may enter into a memorandum of
understanding (or other formal agreement) with an eligible
country or international organization for the purpose of
reciprocal use of ranges and other facilities where
testing of defense equipment may be conducted.
``(b) General Nature of Agreement.--Formal agreements
reached under subsection (a) shall require reciprocal use of
test ranges and other facilities where testing may be
conducted in the United States and at such ranges and
facilities operated by an eligible country or international
organization.
``(c) Payment of Costs.--Any agreement for the reciprocal
use of ranges and other facilities where testing may be
conducted shall contain the following pricing principles for
reciprocal application:
``(1) The price charged a recipient country for test and
evaluation services furnished by the officers, employees, or
governmental agencies of the supplying country or
international organization, shall be the direct costs to the
supplying country or international organization that are
incurred as a result of the test and evaluation services
acquired by the recipient country or international
organization.
``(2) The recipient country or international organization
may be charged for indirect costs related to the use of the
range or other facility where testing may be conducted only
as specified in the memorandum of understanding or other
formal agreement.
``(d) Retention of Funds Collected From Eligible Countries
and International Organizations.--Amounts collected under
subsection (c) from an eligible country or international
organization shall be credited to the appropriation accounts
under which such costs were incurred.
``(e) Definitions.--In this section:
``(1) Direct cost means any item of cost that is easily and
readily identified to a specific unit of work or output
within the range or facility where such testing and
evaluation occurred, that would not have been incurred if
such testing and evaluation had not taken place. Direct cost
may include labor, materials, facilities, utilities,
equipment, supplies, and any other resources of the range or
facility where such test and evaluation occurred, that is
consumed or damaged during such test and evaluation, or
maintained for the recipient country or international
organization.
``(2) Indirect costs means any item of cost that cannot
readily, or directly, be identified to a specific unit of
work or output. Indirect cost may include general and
administrative expenses for the supporting base operations,
manufacturing expenses, supervision, office supplies,
utility, costs, etc. Such costs are accumulated in a cost
pool and allocated to customers appropriately.
``(f) Delegation of Authority.--The Secretary may delegate
to the Deputy Secretary of Defense and to the head of one
designated office of his choosing the authority to determine
the appropriateness of the amount of indirect costs included
in such charges.''.
(b) Clerical Amendment.--The table of sections at the
beginning of such chapter is amended by adding at the end the
following new item:
``23501. Agreements for the cooperative use of ranges and other
facilities where testing may be conducted.''.
(c) Authority To Use Major Range and Test Facility
Installations of the Military Departments Under the
Department of Defense Contract.--Section 2681(c) of title 10,
United States Code, is amended--
(1) by inserting ``(1)'' after ``(c)''; and
(2) by adding at the end the following new paragraph:
``(2) Notwithstanding the requirement for reimbursement of
all direct costs under subparagraph (1), a contractor, using
a Major Range and Test Facility Base installation in support
of a Department of Defense requirement, may be provided
access to and use of the Major Range and Test Facility Base
Installations and charged for services for purposes of the
contract utilizing the same criteria as would be applied to
use of a Major Range and Test Facility Base Installation by
an activity or agency of the Department of Defense. A
contractor of a Department or agency of the Federal
Government other than the Department of Defense shall be
provided access to and use of a Major Range and Test Facility
Base Installation and services in support of such contract at
the discretion of the Secretary of Defense, and may be
charged for access, use and services on the same basis as the
Federal government Department or agency funding the
contract.''.
SEC.__.COOPERATIVE RESEARCH AND DEVELOPMENT PROJECTS: ALLIED
COUNTRIES.
Section 2350a of title 10, United States Code, is amended
as follows:
(1) In the title for Section 2350a--by striking out
``allied'' and inserting ``NATO ally,
[[Page S7223]]
major non-NATO ally, other friendly foreign country, or NATO
organization''.
(2) Paragraph (a) is amended by striking ``one or more
major allies of the United States or NATO organizations'' and
inserting ``the North Atlantic Treaty Organization (NATO) or
with one or more member countries of that Organization, or
with any major non-NATO ally or other friendly foreign
country or NATO organization''.
(3) Paragraph (b)(1) is amended--
(A) by striking ``(1)'';
(B) by striking ``the North Atlantic Treaty Organization
(NATO)'' and inserting ``NATO'';
(C) by striking ``its major non-NATO allies.'' and
inserting ``a NATO ally, a major non-NATO ally or other
friendly foreign country or NATO organization.''.
(4) Paragraph (b)(2) is amended by striking ``The authority
of the Secretary to make a determination under paragraph (1)
may only be delegated to the Deputy Secretary of Defense or
the Under Secretary of Defense for Acquisition and
Technology.'' and inserting ``The authority of the Secretary
to make a determination under paragraph (1) may be delegated
only to the Deputy Secretary of Defense and to one other
official the Secretary so determines.''.
(5) Paragraph (d)(1) is amended by striking ``the major
allies of the United States'' and inserting ``a NATO ally, a
major non-NATO ally or other friendly foreign country or NATO
organization''.
(6) Paragraph (d)(2) is amended by striking ``major ally of
the United States'' and inserting ``a NATO ally, a major non-
NATO ally or other fdendly foreign country or NATO
organization''.
(7) Paragraph (e)(1)(B)(2)(A) is amended by striking ``one
or more of the major allies of the United States.'' and
inserting ``a NATO ally, a major non-NATO ally or other
friendly foreign country or NATO organization.''.
(8) Paragraph (e)(1)(B)(2)(B) in amended by striking ``one
or more major allies of the United States or NATO
organizations'' and inserting ``a NATO ally, a major non-NATO
ally or other friendly foreign country or NATO
organization''.
(9) Paragraph (e)(1)(B)(2)(C) is amended by striking ``one
or more major allies of the United States'' and inserting ``a
NATO ally, a major non-NATO ally or other friendly foreign
country or NATO organization''.
(10) Paragraph (e)(1)(B)(2)(D) in amended by striking ``one
or more major allies of the United States'' and inserting ``a
NATO ally, a major non-NATO ally or other friendly foreign
country or NATO organization''.
(11) Paragraph (f)(B)(1) is amended by striking ``(1)''.
(12) Paragraph (f)(B)(2) is amended by striking ``The
Secretary of Defense and the Secretary of State, whenever
they consider such action to be warranted, shall jointly
submit to the Committee on Armed Services and the Committee
on Foreign Relations of the Senate and the Committee on
National Security and the Committee on International
Relations of the House of Representatives a report--(A)
enumerating those countries to be added to or deleted from
the existing designation of countries designated as major
non-NATO allies for purposes of this section; and (B)
specifying the criteria used in determining the eligibility
of a country to be designated as a major non-NATO ally for
purposes of this section.''.
(13) Paragraph (g)(1)(A) is amended by striking ``major
allies of the United States and other friendly foreign
countries.'' and inserting ``a NATO ally, a major non-NATO
ally or other friendly foreign country or NATO
organization''.
(14) Paragraph (i) is amended by striking ``(2) The term
``major ally of the United States'' means--(A) a member
nation of the North Atlantic Treaty Organization (other than
the United States); or (B) a major non-NATO ally.''.
(15) Paragraph (i)(1) is amended by striking ``one or more
major allies of the United States or NATO organizations'' and
inserting ``a NATO ally, a major non-NATO ally or other
friendly foreign country or NATO organization''.
SEC. 903. RECOGNITION OF ASSISTANCE FROM FOREIGN NATIONALS.
(a) In General.--Chapter 57 of title 10, United States
Code, is amended by inserting after section 1133 the
following:
``Sec. 1134. Recognition of assistance from foreign nationals
``The Secretary of Defense may issue regulations, with the
concurrence of the Secretary of State, authorizing members of
the armed forces or civilian officers or employees of the
Department of Defense to present to foreign nationals
plaques, trophies, non-currency coins, certificates, and
other suitable commemorative items or mementos to recognize
achievements or performance, not involving combat, that
assists the armed forces of the United States.''.
(b) Clerical Amendment.--The table of sections at the
beginning of such chapter is amended by inserting after the
item relating to section 1133 the following new item:
``1134. Recognition of assistance from foreign nationals.''.
SEC. 904. PERSONAL SERVICE CONTRACTS IN FOREIGN AREAS.
Under such regulations as the Secretary of State, with the
concurrence of the Secretary of Defense, may prescribe, the
Department of State shall use authority available to the
Department of State to enter into personal services contracts
with individuals to perform services in support of the
Department of Defense in foreign countries.
Subtitle B--Department of Defense Civilian Personnel
Sec. 911. Removal of Limits on the Use of Voluntary Early Retirement
Authority and Voluntary Separation Incentive Pay for
Fiscal Years 2002 and 2003.
Sec. 912. Authority for Designated Civilian Employees Abroad to Act as
a Notary.
Sec. 913. Inapplicability of Requirement for Studies and Reports When
All Directly Affected Department of Defense Civilian
Employees Are Reassigned to Comparable Federal Positions.
Sec. 914. Preservation of Civil Service Rights for Employees of the
Former Defense Mapping Agency.
Sec. 915. Financial Assistance to Certain Employees in Acquisition of
Critical Skills.
Sec. 916. Pilot Program for Payment of Retraining Expenses.
SEC. 911. REMOVAL OF LIMITS ON THE USE OF VOLUNTARY EARLY
RETIREMENT AUTHORITY AND VOLUNTARY SEPARATION
INCENTIVE PAY FOR FISCAL YEARS 2002 AND 2003.
Section 1153(b) of the Floyd D. Spence National Defense
Authorization Act for Fiscal Year 2001 (Public Law 106-398,
114 Stat. 1654A-323) is amended--
(1) in paragraph (1), by striking ``(1) Subject to
paragraph (2), the'' and inserting ``The'';
(2) by striking paragraph (2); and
(3) by redesignating subparagraphs (A) and (B) as
paragraphs (1) and (2).
SEC. 912. AUTHORITY FOR DESIGNATED CIVILIAN EMPLOYEES ABROAD
TO ACT AS A NOTARY.
(a) Clarification of Status of Civilian Attorneys Acting as
a Notary.--Section 1044a(b)(2) of title 10, United States
Code, is amended by striking ``legal assistance officers''
and inserting ``legal assistance attorneys''.
(b) Authority for Designated Civilian Employees Abroad To
Act as a Notary.--Subsection (b)(4) of such section 1044a is
amended by inserting ``and, when outside the United States,
all civilian employees of the armed forces of suitable
training,'' after ``duty status''.
SEC. 913. INAPPLICABILITY OF REQUIREMENT FOR STUDIES AND
REPORTS WHEN ALL DIRECTLY AFFECTED DEPARTMENT
OF DEFENSE CIVILIAN EMPLOYEES ARE REASSIGNED TO
COMPARABLE FEDERAL POSITIONS.
Section 2461 of title 10, United States Code, is amended by
adding at the end the following new subsection:
``(i) Inapplicability When All Directly Affected Department
of Defense Civilian Employees Are Reassigned to Comparable
Federal Positions.--The provisions of this section shall not
apply when all directly affected Department of Defense
civilian employees serving on permanent appointments are
reassigned to comparable Federal positions for which they are
qualified.''.
SEC. 914. PRESERVATION OF CIVIL SERVICE RIGHTS FOR EMPLOYEES
OF THE FORMER DEFENSE MAPPING AGENCY.
Notwithstanding section 1612 of title 10, United States
Code, the provisions of subchapters II and IV (sections 7511
through 7514 and sections 7531 through 7533, respectively) of
chapter 75 of title 5, United States Code, continue to apply,
for as long as the employee continues to serve as a
Department of Defense employee in the National Imagery and
Mapping Agency without a break in service, to each of those
former Defense Mapping Agency employees who occupied
positions established under title 5, United States Code, and
who on October 1, 1996, became employees of the National
Imagery and Mapping Agency under paragraph 1601 (a)(1) of
title 10, United States Code pursuant to Title XI of the
National Defense Authorization Act for Fiscal Year 1997
(Public Law 104-20 1; 110 Stat. 2675, et seq.) and for whom
the provisions of chapter 75 of title 5, United States Code,
applied before October 1, 1996. Each such employee, at any
time, may elect in writing to waive the provisions of this
section, in which case such waiver shall be permanent as to
that employee.
SEC. 915. FINANCIAL ASSISTANCE TO CERTAIN EMPLOYEES IN
ACQUISITION OF CRITICAL SKILLS.
The Secretary of Defense may provide the Director, National
Imagery and Mapping Agency, the authority to establish an
undergraduate training program with respect to civilian
employees of the National Imagery and Mapping Agency that is
similar in purpose, conditions, content, and administration
to the program which the Secretary of Defense is authorized
to establish for civilian employees of the National Security
Agency under section 16 of the National Security Agency Act
of 1959 (50 U.S.C. 402 note).
SEC. 916. PILOT PROGRAM FOR PAYMENT OF RETRAINING EXPENSES.
(a) In General.--Chapter 141 of title 10, United States
Code, is amended by adding at the end the following new
section:
``Sec. 2410o. Pilot program for payment of retraining
expenses
``(a) Authority.--The Secretary of Defense may establish a
pilot program for the payment of retraining expenses in
accordance
[[Page S7224]]
with this section to facilitate the reemployment of eligible
employees of the Department of Defense who are being
involuntarily separated due to a reduction-in-force or due to
relocation resulting from transfer of function, realignment,
or change of duty station. Under the pilot program, the
Secretary may pay retraining incentives to encourage non-
Federal employers to hire and retain such employees.
``(b) Eligible Employees.--For purposes of this section, an
eligible employee is an employee of the Department of
Defense, serving under an appointment without time
limitation, who has been employed by the Department of
Defense for a continuous period of at least 12 months and who
has been given notice of separation pursuant to a reduction
in force, except that such term does not include--
``(1) a re-employed annuitant under subchapter III of
chapter 83 of title 5, United States Code, chapter 84 of such
title, or another retirement system for employees of the
Government;
``(2) an employee who, upon separation from Federal
service, is eligible for an immediate annuity under
subchapter III of chapter 83 of title 5, United States Code,
or subchapter II of chapter 84 of such title; or
``(3) an employee who is eligible for disability retirement
under any of the retirement systems referred to in paragraph
(1).
``(c) Retraining Incentive.--(1) Under the pilot program,
the Secretary may enter into an agreement with a non-Federal
employer under which the non-Federal employer agees--
``(A) to employ an eligible person referred to in
subsection (a) for at least 12 months for a salary that is
mutually agreeable to the employer and such person; and
``(B) to certify to the Secretary the cost incurred by the
employer for any necessary training, as defined by the
Secretary, provided to such eligible employee in connection
with the employment by that employer.
``(2) The Secretary may pay a retraining incentive to the
non-Federal employer upon the employee's completion of 12
months of continuous employment with that employer. Subject
to this section, the Secretary shall prescribe the amount of
the incentive.
``(3) The Secretary may pay a prorated amount of the full
retraining incentive to the non-Federal employer for an
employee who does not remain employed by the nonFederal
employer for at least 12 months.
``(4) In no event may the amount of retraining incentive
paid for the training of any one person under the pilot
program exceed the amount certified for that person under
paragraph (1) or $10,000, whichever is greater.
``(d) Duration.--No incentive may be paid under the pilot
program for training commenced after September 30, 2005.
``(e) Definitions.--The following definitions apply in this
section:
``(1) The term ``non-Federal employer'' means an employer
that is not an Executive Agency, as defined in section 105 of
title 5, United States Code, or the legislative or judicial
branch of the Federal Government.
``(2) ``Reduction-in-force'' and ``transfer of function''
shall have the same meaning as in chapter 35 of title 5,
United States Code.''.
(b) Clerical Amendment.--The table of sections at the
beginning of such Chapter 141 is amended by adding at the end
the following new item:
``2410o. Pilot program for payment of retraining expenses.''.
Subtitle C--Other Matters
Sec. 921. Authority to Ensure Demilitarization of Significant Military
Equipment Formerly Owned by the Department of Defense.
Sec. 922. Motor Vehicles: Documentary Requirements for Transportation
for Military Personnel and Federal Employees on Change of
Permanent Station.
Sec. 923. Department of Defense Gift Initiatives.
Sec. 924. Repeal of the Joint Requirements Oversight Council Semi-
Annual Report.
Sec. 925. Access to Sensitive Unclassified Information.
Sec. 926. Water Rights Conveyance, Andersen Air Force Base, Guam.
Sec. 927. Repeal of Requirement For Separate Budget Request For
Procurement of Reserve Equipment.
Sec. 928. Repeal of Requirement for Two-year Budget Cycle for the
Department of Defense.
SEC. 921. AUTHORITY TO ENSURE DEMILITARIZATION OF SIGNIFICANT
MILITARY EQUIPMENT FORMERLY OWNED BY THE
DEPARTMENT OF DEFENSE.
(a) In General.--Chapter 153 of title 10, United States
Code, is amended by inserting after section 2572 the
following new section:
``Sec. 2573. Continued authority to require demilitarization
of significant military equipment after disposal
``(a) Authority To Require Demilitarization.--The Secretary
of Defense may require any person in possession of
significant military equipment formerly owned by the
Department of Defense--
``(1) to demilitarize the equipment:
``(2) to have the equipment demilitarized by a third party;
or
``(3) to return the equipment to the Government for
demilitarization.
``(b) Cost and Validation of Demilitarization.--When the
demilitarization of significant military equipment is carried
out by the person in possession of the equipment pursuant to
paragraph (1) or (2) of subsection (a), the person shall be
solely responsible for all demilitarization costs, and the
United States shall have the right to validate that the
equipment has been demilitarized.
``(c) Return of Equipment to Government.--When the
Secretary of Defense requires the return of significant
military equipment for demilitarization by the Government,
the Secretary shall bear all costs to transport and
demilitarize the equipment. If the person in possession of
the significant military equipment obtained the property in
the manner authorized by law or regulation and the Secretary
determines that the cost to demilitarize and return the
property to the person is prohibitive, the Secretary shall
reimburse the person for the purchase cost of the property
and for the reasonable transportation costs incurred by the
person to purchase the equipment.
``(d) Establishment of Demilitarization Standards.--The
Secretary shall issue regulations to prescribe what
constitutes demilitarization for each type of significant
military equipment, with the objective of ensuring that the
equipment does not pose a significant risk to public safety
and does not provide a significant weapon capability or
military-unique capability and ensure that any person from
whom private property is taken for public use under this
section receives just compensation.
``(e) Exceptions.--This section does not apply--
``(1) when a person is in possession of significant
military equipment formerly owned by the Department of
Defense for the purpose of demilitarizing the equipment
pursuant to a Government contract.
``(2 ) to small arms weapons issued under the Defense
Civilian Marksmanship Program established in Title 36, United
States Code.
``(3) to issues by the Department of Defense to museums
where modified demilitarization has been performed in
accordance with the Department of Defense Demilitarization
Manual, DoD 4160.21-M-1; or
``(4) to other issues and un-demilitarized significant
military equipment under the provisions of the provisions of
the Department of Defense Demilitarization Manual, DoD
4160.21-M-1.
``(f) Definition of Significant Military Equipment.--In
this section, the term ``significant military equipment''
means--
``(l) an article for which special export controls are
warranted under the Arms Export Control Act (22 U.S.C. 2751
et seq.) because of its capacity for substantial military
utility or capability, as identified on the United States
Munitions List maintained under section 121.1 of title 22,
Code of Federal Regulations; and 46
(2) any other article designated by the Department of
Defense as requiring demilitarization before its disposal.''.
(b) Clerical Amendment.--The table of sections at the
beginning of such chapter is amended by inserting after the
item relating to section 2572 the following new item:
``2573. Continued authority to require demilitarization of significant
military equipment after disposal.''.
SEC. 922. MOTOR VEHICLES: DOCUMENTARY REQUIREMENTS FOR
TRANSPORTATION FOR MILITARY PERSONNEL AND
FEDERAL EMPLOYEES ON CHANGE OF PERMANENT
STATION.
(a) Military Personnel.--Section 2634 of title 10, United
States Code, is amended as follows:
(1) by redesignating subsections (f), (g) and (h) as
subsections (g), (h), and (i) respectively; and
(2) by inserting after subsection (e) the following new
subsection;
``(f) Motor vehicles transported under this section are not
subject to the provisions of the Anti Car Theft Act of 1992,
as amended, or any implementing regulations. The Secretary of
Defense (and the Secretary of Transportation with respect to
the Coast Guard when it is not operating as a Service in the
Navy) will prescribe regulations designed to ensure members
do not present for shipment stolen vehicles.''.
(b) Civilian Employees.--Section 5727 of title 5, United
States Code, is amended as follows:
(1) by redesignating subsection (f) as subsection (g); and
(2) by inserting after subsection (e) the following new
subsection:
``(f) Motor vehicles transported under this section are not
subject to the provisions of the Anti Car Theft Act of 1992,
as amended, or any implementing regulations. Regulations
prescribed under section 5738 of this title will include
provisions designed to ensure employees do not present for
shipment stolen motor vehicles under subsection (b) of this
section.''.
SEC. 923. DEPARTMENT OF DEFENSE GIFT INITIATIVES.
(a) Loan or Gift of Obsolete Material and Articles of
Historical Interest.--Section 7545 of title 10, United States
Code, is amended--
(1) in subsection (a)--
(A) by inserting the following catchline after the
subsection designator: ``Additional Items To Be Donated by
the Secretary of the Navy.'';
(B) by striking ``books, manuscripts, works of art,
drawings,'' and all that follows to the dash and inserting
``obsolete combat or shipboard material not needed by the
Department of the Navy, to'';
[[Page S7225]]
(C) in paragraph (5), by striking ``World War I or World
War 11'' and inserting ``a foreign war.'';
(D) in paragraph (6), by striking ``soldiers'' and
inserting ``servicemen's''; and
(E) in paragraph (8), by inserting ``or memorial'' after
``a museum''; and
(2) in subsection (b), by inserting the following catchline
after the subsection designator: ``Maintenance of the Records
of the Government.--'';
(3) in subsection (c), by inserting the following catchline
after the subsection designator: ``Secretarial Authority To
Make Gifts or Loans.--''; and
(4) by adding at the end the following new subsection:
``(d) Authority To Transfer a Portion of a Vessel.--The
Secretary may lend, give or otherwise transfer any portion of
the hull or superstructure of a vessel stricken from the
Naval Vessel Register and designated for scrapping to a
qualified organization listed under subsection (a). The terms
and conditions of any agreement for the transfer of a portion
of a vessel under this section shall include a requirement
that the transferee will maintain the material conveyed in a
condition that will not diminish the historical value of the
material or bring discredit upon the Navy.''.
(b) Loan, Gift, or Exchange of Documents, Historical
Artifacts, and Condemned or Obsolete, Combat Material.--
Section 2572(a)(1) of such title 10 is amended by striking
the period after ``A municipal corporation'' and inserting
county or other political subdivision of a state.''.
SEC. 924. REPEAL OF THE JOINT REQUIREMENTS OVERSIGHT COUNCIL
SEMI-ANNUAL REPORT.
Section 916 of the Floyd D. Spence National Defense
Authorization Act for Fiscal Year 2001 (Public Law 106-398;
114 Stat. 1654) is repealed.
SEC. 925. ACCESS TO SENSITIVE UNCLASSIFIED INFORMATION.
(a) In General.--Chapter 137 of title 10, United States
Code, is amended by adding at the end the following new
section:
Sec. ``2332. Limited access to sensitive unclassified
information by administrative support contractors
``(a) Authority.---Notwithstanding sections 552a of title
5, 2320 of title 10, and 1905 of title 18, United States
Code, the Secretary of Defense may provide administrative
support contractors with limited access to, and use of,
sensitive unclassified information, provided that--
``(1) such disclosure is not otherwise prohibited by law;
``(2) access shall be limited to sensitive unclassified
information that is necessary for the administrative support
contractor to perform contractual duties;
``(3) administrative support contractors shall be subject
to the same restrictions on using, reproducing, modifying,
performing, displaying, releasing or disclosing such
sensitive unclassified information as are applicable to
employees of the United States; and
``(4) administrative support contractors shall be subject
to the same civil and criminal penalties for unauthorized
disclosure or use of such sensitive unclassified information
as are applicable to employees of the United States.
``(b) Definitions.--The following definitions apply to this
section:
``(1) The term ``sensitive unclassified information'' means
all unclassified information for which disclosure to an
administrative support contractor is prohibited by the
Privacy Act (5 U.S.C. Sec. 552a); section 2320 of this title;
or the Trade Secrets Act (18 U.S.C. Sec. 1905).
``(2) The term ``administrative support contractor'' means
any officer or employee of a contractor or subcontractor who
performs any of the following for or on behalf of the
Department of Defense: secretarial or clerical support;
provisioning or logistics support; data entry; document
reproduction, scanning, or imaging; operation, management, or
maintenance of paper-based or electronic mail rooms, file
rooms, or libraries; installation, operation, management, or
maintenance of internet or intranet systems, networks, or
computer systems; and facilities or information security.''.
(b) Clerical Amendnent.--The table of sections at the
beginning of such chapter 137 is amended by adding at the end
the following new item:
``2332. Limited access to sensitive unclassified information by
administrative support contractors.''.
SEC. 926. WATER RIGHTS CONVEYANCE, ANDERSEN AIR FORCE BASE,
GUAM.
(a) Authority To Convey.--In conjunction with the
conveyance of a utility system under the authority of section
2688 of title 10, United States Code, and in accordance with
all the requirements of that section, the Secretary of the
Air Force may convey all right, title, and interest of the
United States, or such lesser estate as the Secretary
considers appropriate to serve the interests of the United
States, in the water rights related to Andy South (also known
as the Andersen Administrative Annex, MARBO (Marianas Bonins
Base Command), and the Andersen Water Supply Annex (also
known as the Tumon Water Well or the Tumon Maui Well), Air
Force properties located on Guam.
(b) Additional Requirements.--The Secretary may exercise
the authority contained in subsection (a) only if--
(1) the Secretary has determined that there exists adequate
supplies of potable groundwater under Andersen Air Force Base
that are sufficient to meet the current and long-term
requirements of the installation for water;
(2) the Secretary has determined that such supplies of
groundwater are economically obtainable; and,
(3) the Secretary requires the conveyee to provide a water
system capable of meeting the water supply needs of Anderson
Air Force Base, as determined by the Secretary.
(c) Interim Water Supplies.--If the Secretary determines
that it is in the best interests of the United States to
transfer title to the water rights and utility systems at
Andy South and Andersen Water Supply Annex prior to placing
into service a new replacement water system and well field on
Andersen Air Force Base, the Secretary may require that the
United States have the primary right to all water produced
from Andy South and Andersen Water Supply Annex until such
new replacement water system and well field is placed into
service and operates to the satisfaction of the Secretary. In
exercising the authority of this subsection, the Secretary
may retain a reversionary interest in the water rights and
utility systems at Andy South and Andersen Water Supply Annex
until such time as the new replacement water system and well
field is placed into service and operates to the satisfaction
of the Secretary.
(d) Sale of Excess Water Authorized.--(1) If the Secretary
exercises the authority contained in subsection (a), he may
provide in any such conveyance that the conveyee of the water
system may sell to public or private entities such water from
Andersen Air Force Base as the Secretary determines to be
excess to the needs of the United States. In the event the
Secretary authorizes the conveyee to resell water, the
Secretary shall negotiate a reasonable return to the United
States of the value of such excess water sold by the
conveyee, which return the Secretary may receive in the form
of reduced charges for utility services provided by the
conveyee.
(2) If the Secretary cannot meet the requirements of
subsection (c), and the Secretary determines to proceed with
a water utility system conveyance under section 2688 of title
10, United States Code, without the conveyance of water
rights, the Secretary may provide in any such conveyance that
the conveyee of the water system may sell to public or
private entities such water from Andy South and Andersen
Water Supply Annex as the Secretary determines to be excess
to the needs of the United States. The Secretary will
negotiate a reasonable return to the United States of the
value of such excess water sold by the conveyee, which return
the Secretary may receive in the form of reduced charges for
utility services provided by the conveyee.
(e) Definitions.--(1) For purposes of this section,
``Andersen Air Force Base'' means the Main Base and Northwest
Field.
(2) The water rights referred to in subsection (a) shall be
considered as part of a ``utility system'' as that term is
defined in section 2688(g)(2) of title 10, United States
Code.
(f) Application of the Other Land Disposal Acts.--The water
rights related to Andy South and Andersen Water Supply Annex
shall not be considered as real property for purposes of the
Act of November 13, 2000, to amend the Organic Act of Guam,
and for other purposes (Public Law 106-504; 114 Stat. 2309)
and the Federal Property and Administrative Services Act of
1949 (40 U.S.C. 471, et seq.).
SEC. 927. REPEAL OF REQUIREMENT FOR SEPARATE BUDGET REQUEST
FOR PROCUREMENT OF RESERVE EQUIPMENT.
Section 114(e) of title 10, United States Code, is
repealed.
SEC. 928. REPEAL OF REQUIREMENT FOR TWO-YEAR BUDGET CYCLE FOR
THE DEPARTMENT OF DEFENSE.
Section 1405 of the Department of Defense Authorization
Act, 1986 (31 U.S.C. 1105 note) is repealed.
____
Sectional Analysis
Sections 101 through 106 provide procurement authorization
for the Military Departments and for Defense-wide
appropriations in amounts equal to the budget authority
included in the President's Budget for fiscal year 2002.
Section 201 provides for the authorization of each of the
research, development, test, and evaluation appropriations
for the Military Departments and the Defense Agencies in
amounts equal to the budget authority included in the
President's Budget for fiscal year 2002.
Section 301 provides for authorization of the operation and
maintenance appropriations of the Military Departments and
Defense-wide activities in amounts equal to the budget
authority included in the President's Budget for fiscal year
2002.
Section 302 authorizes appropriations for the Working
Capital Funds and the National Defense Sealift Fund in
amounts equal to the budget authority included in the
President's Budget for fiscal year 2002.
Section 303 authorizes appropriations for fiscal year 2002
for the Armed Forces Retirement Home Trust Fund for the Armed
Forces Retirement Home, including the United States Soldiers'
and Airmen's Home and the United States Naval Home in amounts
equal to the budget authority included in the President's
Budget for fiscal year 2002.
[[Page S7226]]
Section 304 would amend section 5(a) of the Multinational
Force and Observers (MFO) Participation Resolution, to
authorize the President to approve contracting out logistical
support functions in support of the MFO that are currently
performed by U.S. military personnel and equipment. The
resolution was enacted in December 1981, in order to
authorize the United States to deploy peacekeepers and
observers to Sinai, Egypt to assist in the fulfillment of the
Camp David Accords. In this regard, it should be noted that
section 5(a) authorizes any agency of the United States to
provide administrative and technical support and services to
the MFO without reimbursement when the provision of such
support or services would not result in significant
incremental costs to the United States.
Administrative and technical support is provided under
section 5(a) by the U.S. Army's 1st Support Battalion
pursuant to international agreements with the Arab Republic
of Egypt, the State of Israel, and the MFO. These agreements
stipulate the types of unit functions required to be
performed by the MFO in order for it to comply with its
treaty verification mission. The two primary support
functions currently provided by the United States to the MFO,
are aviation and logistics support. Aviation support is
provided to the MFO by ninety-nine soldiers and ten U.S. Army
UH-1H helicopters. General logistical support to the MFO is
provided by one hundred and fifty soldiers assigned to the
U.S. Logistical Support Unit.
Section 305 would authorize the Secretary of Defense or
designee to enter into multiple-year operating contracts or
leases or charters of commercial craft, where economically
feasible, in advance of the availability of funds in the
working capital fund. The contract authority is available for
obligation for one year and cannot exceed in its entirely
$427,100,000. In subsequent years, the Department may submit
requests for additional contract authority. This authority is
appropriate for working capital funds where a history of use
indicates an annual utilization of these items by DoD
customers will be more than sufficient to pay for the annual
costs. The use of annual leases, charters or contracts is not
cost effective in obtaining capital items, or the use of
commercial craft. To reduce the overall costs for DoD,
authority to enter into multiple-year leases and charters is
needed. Additional annual appropriated funds, however, are
not needed, since the revenues generated from the use of
these items to fill customer orders will cover these costs.
Section 1301 of title 31, United States Code, discusses the
application of appropriations and requires, in subsection
(d), that to authorize making a contract for the payment of
money in excess of an appropriation a new law must
specifically state that such a contract may be made. As the
change specifically addresses only multiple-year leases,
charters or contracts by working capital funds, the contract
authority granted by this proposal would not impact other
programs.
Similar authority, successfully utilized by the Navy
Industrial Fund in connection with the long term vessel
charters of T-5 tankers, was approved by Congress as part of
the Supplemental Appropriations Act of 1983. That program and
the use of contract authority was favorably reviewed by the
Comptroller General in B-174839, March 20, 1984. As indicated
in the opinion, working capital funds are precluded from
negotiating cost effective multiple-year contracts for
capital items or associated services without posting
obligations for the entire amount, even though no
appropriations are likely to ever be needed.
The Military Sealift Command (MSC) provides world-wide
capability for sealift, prepositioning assets, and a wide
arrange of oceanographic services. They operate approximately
125 ships worldwide with civilian mariners. Because the
Military Sealift Command is a Working Capital Fund activity,
their funding is provided through customer orders for sealift
services, generally on an annual basis. Contract authority is
required to allow MSC to enter into multiple year leases in
advance of appropriations. The legislative proposal provides
that authority.
It is advantageous for the Government to have MSC enter
into multiple year leases for these charter and associated
services for a number of reasons, including:
The 29 prepositioned ships carry a variety of items.,
including ammunition, fuel, medical supplies, and heavy
armored equipment. The offload and onload of this cargo
requires significant logistics infrastructure and is a costly
undertaking. The DoD infrastructure is sized for that
operation to take place concurrent with the required
maintenance schedule for the ships, which ranges from two to
five years depending on the type of ship and type of cargo.
The contract period is established to coincide with this
schedule. If these contracts were required to be annual
contracts, there could be significant operational degradation
and excessive demand on the DoD infrastructure due to
offload and onload requirements at potentially annual
periods.
The commercial market standard is for multiple year
charters. There are savings to DoD by negotiating multiple
year leases, consistent with commercial practices. In
addition, DoD would not be able to effectively compete for
annual contracts because foreign flag carriers are not
interested in competing for short-term contracts due to the
costs they incur to re-flag the vessels and to prepare or
modify ships to meet DoD needs. Past experience indicates
that the costs to DoD would be significantly higher if
competition were limited to currently U.S.-flag vessels on an
annual basis.
If the legislation is not enacted, MSC will be required to
negotiate the contracts on an annual basis, resulting in
increased costs and potential disruptions to military
operations.
Section 310. The Navy and the U.S. Environmental Protection
Agency (EPA) entered into an agreement in January 2001 for
payment of EPA response costs at the Hooper Sands Site, South
Berwick, Maine for EPA's remaining past response costs
incurred by the agency for the period from May 12, 1992
through July 31, 2000. Activities of the Navy are liable
under the Comprehensive Environmental Response, Compensation
and Liability Act of 1980 as generators who arranged for
disposal of the hazardous substances that ended up at the
site, and there are no other viable responsible parties.
Under the agreement, the Navy would pay for EPA's final
response actions that were undertaken to protect human health
and the environment at this site. The agreement also
stipulated that the Navy would seek authorization from
Congress in the FY02 legislative program for payment of costs
previously incurred by EPA at the site. Should Congress
approve this legislative proposal, the Navy would pay EPA
with funds from the Navy's ``Environmental Restoration
Account, Navy'' in an amount equal to the principle
($809,078.00) and interest ($196,400.00), or a total of
$1,005,478.00.
Section 311 would extend the authority to conduct the pilot
program from September 30, 2001 to September 30, 2003. The
original legislation authorized the pilot program to run for
two years from the date of enactment on November 18, 1997.
Section 325 of the National Defense Authorization Act for
Fiscal Year 2000 (Public Law 106-65; 113 Stat. 512) extended
that two-year deadline an additional two years.
The initial extension was requested because the Department
of Defense implementation guidance, required by the statute,
had not been completed as of the fall of 1998. In order to
fulfill the purpose of the legislation and adequately assess
the feasibility and advisability of the sale of economic
incentives, the pilot program was extended another two years
from its original deadline. We are requesting an additional
two-year extension to allow further opportunity for the
Department to assess the feasibility of the program. States
have been slower to develop emission-trading programs than
initially anticipated and more time is desired to allow
military installations to become familiar with the benefits
of economic incentive programs.
Section 351 also provides authority to the Department of
Defense (DoD) to retain proceeds from the sale of Clean Air
Act emission reduction credits, allowances, offsets, or
comparable economic incentives. Federal fiscal law and
regulations generally require proceeds from the sale of
government property to be deposited in the U.S. Treasury.
These authorities preclude an agency from keeping the funds
generated by reducing air emissions and selling the credits
as does private industry. This inhibits the reinvestment of
those funds to purchase air credits needed in other areas and
eliminates any incentive for installations to spend the money
required to generate the credits in order to sell them.
The Clean Air Act (CAA) mandates that states establish
state implementation plans (SIPS) to attain and maintain the
national ambient air quality standards (NAAQs), which are
health based standards established for certain criteria air
pollutants, e.g., ozone, particulate matter, carbon monoxide.
To further this mandate, the 1990 Clean Air Act Amendments
provided language encouraging the states to include
``economic incentive'' programs in their SIPs. Such programs
encourage industry to reduce air pollution by offering
monetary incentives for the reduction of emissions of
criteria air pollutants.
A significant and growing number of state and local air
quality districts have established various types of emission
trading systems. Absent the proposed legislation, the
military services would be required to remit any proceeds
from the sale of economic incentives to the U.S. Treasury.
The proposed legislation grants military installations
authority to sell the economic incentives and to retain the
proceeds in order to create a local economic incentive to
reduce air pollution above and beyond legal requirements.
Retention and use of proceeds at the installation level is a
key component of the pilot program.
Section 312 would remove the requirement for the Department
of Defense to submit an annual report to Congress on its
reimbursement of environmental response action costs for the
top 20 defense contractors, as well as on the amount and
status of any pending requests for such reimbursement by
those same firms. This reporting requirement was slated to
end in December 1999 pursuant to section 3003(a) of the
Federal Reports Elimination and Sunset Act of 1995, Pub. L.
104-66; however, it was reinstated by section 1031 of the
National Defense Authorization Act for Fiscal Year 2000, Pub.
L. 106-65.
The Department strongly recommends removal of this
statutory reporting requirement because the data collected
are not necessary, or even helpful, for properly determining
allowable environmental response action costs on Government
contracts. Moreover, the Department does not routinely
collect data on any other categories of contractor overhead
costs.
[[Page S7227]]
This reporting requirement is very burdensome on both the
Department and contractors, diverting limited resources for
data collection efforts that do not benefit the procurement
process. Not only are there 20 different firms involved, but
for most of these contractors, data must be collected for
multiple locations in order to get an accurate company-wide
total. In many cases the data must be derived from company
records because it is not normally maintained in contractor
accounting systems. After the data is collected,
Department contracting officers must review, assemble, and
forward the data through their respective chains of
command to the Defense Contract Audit Agency for
validation. After validation, the data is provided to the
Secretary of Defense's staff for consolidation into the
summary report provided to Congress.
In addition, the summary data provided to Congress in this
annual report have shown that the Department is not expending
large sums of money to reimburse contractors for such costs.
The Department's share of such costs in FY99 was
approximately $11 million. In the preceding years the costs
were, $13 million in FY98, $17 million for FY97, and $4
million for FY96.
Section 315 would amend section 2482(b)(1) of title 10, to
extend its reach to all Defense working capital fund
activities that provide the Defense Commissary Agency
services, and allow them to recover those administrative and
handling costs the Defense Commissary Agency would be
required to pay for acquiring such services.
Currently, section 2482(b)(1) restricts the amount that the
United States Transportation Command could charge to the
Defense Commissary Agency for such services to the price at
which the service could be obtained through full and open
competition, as section 4(6) of the Office of Federal
Procurement Policy Act (41 U.S.C. 403(6)) defines such terms.
These same restrictions, however, do not apply to other
Defense working capital fund activities and preclude the
United States Transportation Command from recovering
``freight forwarding'' costs that the Defense Commissary
Agency would ordinarily have had to pay a commercial
contractor.
If enacted, the proposed amendment would end this inequity,
by applying a single cost-effective guideline for such
charges to all Defense working capital fund activities. It
should also be noted that the last sentence of the proposed
amendment continues the current policy of insuring that costs
associated with mobilization requirements, maintenance of
readiness, or establishment or maintenance of the
infrastructure to support mobilization or readiness
requirements, are not passed on to the customers of the
Defense Commissary Agency.
This proposal will not increase the budgetary requirements
of the Department of Defense.
Section 316 requires that the Defense Commissary Agency
surcharge account be reimbursed for the commissary's share of
the depreciated value of its stores when a Military
Department allows the occupation of a facility--previously
acquired, constructed or improved with commissary surcharge
funds--to be used for non-commissary related purposes.
Section 317 would permit the Defense Commissary Agency
(DECA) to sell limited exchange merchandise at locations
where no exchange facility is operated by an Armed Service
Exchange. Under Section 2486(b) of title 10, United States
Code, the Secretary of Defense may authorize DeCA to purchase
and sell as commissary store inventory a limited line of
exchange merchandise. This amendment is required to obtain
the necessary authority for DeCA to procure the exchange
merchandise items from the Armed Service Exchange. The Armed
Service Exchange selling price to DeCA for such items would
not exceed the normal exchange retail cost less the amount of
the commissary surcharge, so that the amount paid by the
patron would be the same. If the Exchange cannot supply the
items authorized to be sold by DeCA, DeCA may procure them
from any authorized source subject to the limitations of
section 2486(e) of title 10 (i.e., that such items are only
exempt from competitive procurement if they comply with the
brand name sale requirements of being sold in the commercial
stores). Regardless from whom such items are procured, they
must be sold in commissaries at cost plus the amount of the
surcharge.
Section 318 would amend a portion of section 2482 (a) of
title 10 that is entitled ``Private Operation'' to delete
overly restrictive language. The current section authorizes
Commissary stores to be operated by private persons under a
contract, but prohibits the contractor from carrying out
functions for the procurement of products to be sold in the
Commissary or from engaging in functions related to the
actual management of the stores. Consequently, the Department
is precluded from realizing the potential benefits that can
be derived from contracting out the operation and management
of the stores. By deleting this language a private contractor
selected to operate Commissary stores would be allowed to
apply best commercial practices in both store operations and
supply chain management, and to achieve economy of scale
savings in procurement, distribution, and transportation of
products to be sold in the Commissary stores. This change
will allow the Department to initiate pilot programs to test
these potential benefits at selected Commissary stores.
Section 320 would establish permanent authority for active
Department of Defense units and organizations to reimburse
National Guard and Reserve units and organizations for the
expenses incurred when Guard and Reserve personnel provide
them intelligence and counterintelligence support. For the
last five years, Congress has authorized such reimbursement
in each year's defense appropriations act. See e.g., section
8059 of the Department of Defense Appropriations Act, 2001
(Public Law 106-259; 114 Stat. 656, 687). For the past
several years the language of these annual provisions has
remained unchanged, and the Department proposes to establish
authority for such reimbursement on a permanent basis.
Such reimbursement constitutes an exception to the general
principle that funds for active DoD organizations may not be
expended to pay the expenses of Guard and Reserve units, and
vice versa. By their training and experience, reserve
intelligence personnel make unique contributions to the
intelligence and counterintelligence programs of active DoD
units and organizations. They also provide invaluable surge
capability to help respond to unforeseen contingencies. Guard
and Reserve units do not program funds for such support of
active DoD units and organizations, which makes it essential
that the supported active units and organizations have the
authority to reimburse the affected Guard and Reserve units
and organizations for the expenses they occur in providing
personnel to perform such support. The practical effect of
this reimbursement authority is in fact to further implement
the principle that active units and organizations should pay
for the expenses of their own programs and activities, while
Guard and Reserve units and organizations should do the same.
A January 5, 1995 Deputy Secretary of Defense memorandum,
``Peacetime Use of Reserve Component Intelligence Elements''
approved a DoD ``Implementing Plan for Improving the
Utilization of the Reserve Military Intelligence Force''
dated December 21, 1994. This plan explicitly recognized the
requirement for an arrangement under which active units and
organizations receiving reserve intelligence support would
reimburse the affected reserve units for their expenses in
providing such support.
This memo was superseded by DoD Directive 3305.7, ``Joint
Reserve Intelligence Program (JRIP),'' February 29, 2000.
Under section 3.1 of this Directive, ``The JRIP engages
[reserve component] intelligence assets during periods of
active and inactive duty to support validated DoD
intelligence requirements across the entire engagement
spectrum from peacetime through full mobilization, coincident
with wartime readiness training.'' Reimbursement of the
affected reserve units is a cornerstone of this arrangement,
and such reimbursement is absolutely essential to success of
the JRIP. Five years of experience with this arrangement have
made it a mature program that should be permanently
authorized.
Section 321 will authorize for sale the remaining materials
in the National Defense Stockpile for which there is no
Department of Defense requirement and which have not yet been
authorized for sale.
Section 401 prescribes the personnel strengths for the
active forces in the numbers provided for by the budget
authority and appropriations requested for the Department of
Defense in the President's Budget for fiscal year 2002.
Section 405 prescribes the strengths for the selected
Reserve of each reserve component of the Armed Forces in the
numbers provided for by the budget authority and
appropriations requested for the Department of Defense in the
President's budget for fiscal year 2002.
Section 406 prescribes the end strengths for reserve
component members on full-time active duty or full-time
National Guard duty for the purpose of administering the
reserve forces for fiscal year 2002.
Section 407 prescribes the minimum end strengths for the
reserve components of the Army and Air Force for dual status
military technicians for fiscal year 2002.
Section 408 prescribes the maximum end strengths for the
reserve components of the Army and Air Force for non-dual
status military technicians for fiscal year 2002.
Section 409 would replace the current sections 12011 and
12012 of title 10, United States Code, with new sections
12011 and 12012, which would accommodate both senior grade
officers (0-4, 0-5, 0-6) and senior grade enlisted members
(E-8, E-9) of the Active Guard and Reserve force. These new
sections would include tables for each Reserve component,
vice each Service, for senior grade officer (12011) and
enlisted member (12012) ceilings. This proposed amendment
would provide for a non-static method of authorizing senior
grade Active Guard and Reserve members, thus eliminating the
requirement to request changes in legislation when the size
of the Active Guard and Reserve force changes. The
methodology would be consistent with that used for Active
component senior grade officers, and tie the number of senior
grade authorizations to the size of the Active Guard and
Reserve force.
Section 410. The proposed amendment to section 523 of title
10, United States Code, increases Defense Officer Personnel
Management Act-authorized end strength limitations for active
duty Air Force officers in the grade of major. This would
continue progress toward achieving an appropriate
distribution of officers within the Air Force. An appropriate
distribution may be achieved by increasing the authorized
strengths of commissioned officers in the grade of major by
seven
[[Page S7228]]
percent starting in fiscal year 2002. This proposed amendment
would not increase the total number of commissioned officers
authorized for the Air Force and would not affect the
officer-to-enlisted ratio.
The budgetary impact of this proposal on Air Force Military
Personnel appropriation budget requirements would be a net
increase of $10 million in FY 2002, as the grade relief is
phased in, and a net increase of approximately $20 million
per year thereafter.
Section 501 would repeal subsection 1074a(d) of title 10,
United States Code, which requires certain health care for
Selected Reserve members of the Army assigned to units
scheduled to deploy within 75 days after mobilization. Since
this provision was enacted, the Department has implemented
several programs to ensure Reserve component members are
medically ready.
The Army has implemented a program called FEDS-HEAL, which
is an alliance with the Department of Veterans Affairs (DVA)
and the Department of Health and Human Services (DHHS) that
allows Army Reserve and National Guard members to complete
physical examinations, receive inoculations and complete
other medical requirements in DVA and DHHS healthcare
facilities across the country. This significantly enhances
access for Reserve component members of the Army to meet
medical and dental readiness requirements.
DoD policy now requires an annual dental examination. To
track Reserve component dental readiness, the Department has
developed a standard dental examination form that can be
completed by a member's personal civilian dentist. Moreover,
the recently expanded TRICARE Dental Program provides Reserve
component members with an affordable means of completing
dental examinations and receiving dental care through a much
larger provider network. The cost to the member to
participate in this insurance program is only $7.63 per month
with the Department paying the remaining 60 percent of the
premium share.
The current statutory requirement to conduct a full
physical examination every two years for members over the age
of 40 and dental care identified during the annual dental
screening is difficult to implement for a select population
that is very fluid with a relatively high turnover
of individuals each year. Those Reserve Component units
and individual Reserve Component members identified as
early-deploying change frequently. The annual cost to the
Department to meet this over-40 physical examination
requirement for early deploying unit members every two
years is $3.8 million, or over four times the annual cost
if an exam were provided every five years as required for
other members of the Reserve force. Additionally,
requiring a complete medical examination every two years
exceeds the recommendations of the U.S. Preventive
Services Task Force, a 20-member non-federal panel
commissioned by the Public Health Service in 1984 to
develop recommendations for clinicians on the appropriate
use of preventive measures. The Task Force does not
consider such frequency of examinations cost effective in
terms of identifying disease or determining deployability.
The use of yearly health assessment questionnaires and
appropriate age specific tests during the five-year
periodic medical examination provide sufficient medical
screening of the population over age 40. Finally,
providing medical and dental services for a specific
population in only two of the seven Reserve Components
creates an inequity among members of the Selected Reserve
and among Reserve Components.
This recommendation was contained in the Secretary of
Defense report to Congress on the means of improving medical
and dental care for Reserve Component members, which
Secretary Cohen sent to Congress on November 5, 1999.
Section 502 would amend section 640 of title 10, United
States Code, to afford members whose mandatory dates of
separation or retirement were delayed due to medical
deferment, a period of time to transition to civilian life
following termination of medical deferment. It would afford
active duty members whose mandatory separations or
retirements incident to Chapter 36 or Chapter 63 of this
title, a period of time, not to exceed 30 days, following
termination of suspensions made under section 640, to
transition to civilian life.
As currently written, section 640 requires immediate
separation or retirement of those medically deferred members
who would have been subject to mandatory separation or
retirement under this title for age (section 1251), length of
service (sections 633-636), promotion (sections 632, 637) or
selective early retirement (section 638). An abrupt
termination, especially of a medical deferment, could cause
undue hardship on those whose planned departure to civilian
life was unexpectedly interrupted and now must be resumed
posthaste. Depending upon the nature of the medical
deferment, there may be some problems with employment
opportunities should the member be thrust back into civilian
life without a reasonable preparation time. The 30-day period
would allow individuals sufficient time to transition to
civilian life, without the distractions of the circumstances
of their deferments. This leeway must be provided for these
members to reschedule the many details incident to final
departure from military life.
Section 503 would add a new section to title 10, United
States Code, to provide for the detail of an officer in a
grade not below lieutenant commander to serve as Officer-in-
Charge of the United States Navy Band. While so serving, an
officer who holds a grade lower than captain (0-6) would have
the grade of captain. The officer's permanent status as a
commissioned officer would not be changed by his detail under
this section.
Navy has one Limited Duty Officer captain (0-6) Bandmaster
(6430) billet--the position of Officer in Charge/Leader, U.S.
Navy Band. The United States Navy Band, Washington, D.C. is
the Navy's premier musical representative. As such, Navy
established this prestigious position at the captain level
because of its extremely high visibility; its importance to
Navy representation; the enormous demands of command as well
as the technical skill required of the incumbent; to provide
proper recognition and compensation for the officer serving
as the Band's leader; and to elevate and maintain this
organization's status at an appropriate level.
Army, Marine Corps, and Air Force premier Service-band
Commanding Officers/Commanders are also 0-6 billets and
selection for those positions is accomplished in a manner
similar to that used by the U.S. Navy Band. Upon assignment
to these positions, leaders of the Army, Marine Corps, and
Air Force bands are specifically ``selected'' for promotion
to 0-6. That is not the case with the Officer-in-Charge/
Leader of the U.S. Navy Band because selection for and
appointment to this position is limited to the Limited Duty
Officer community. As such, those selected for this special
appointment are generally officers with 28-32 years of total
active service at the time of selection and appointment as
Officer-in-Charge/Leader, U.S. Navy Band. However, the
established career path of Limited Duty Officers typically
results in selection for this position while serving in the
grade of lieutenant commander (0-4) or commander (0-5) and
flow points normally do not provide an opportunity for
promotion to 0-6 prior to statutory retirement.
Section 504. General/flag officers serving above the grade
of 0-8 serve in a temporary grade that is authorized by the
position. Such officers generally hold a permanent grade of
0-8. Under current law, for the officer to retire in a grade
above 0-8, the Secretary of Defense must determine and then
certify to the President and the Congress that such officer
served satisfactorily on active duty in the higher grade.
Most officers who serve in grades above 0-8 are approved for
retirement in the highest grade held. Section 504 would
retain the requirement for the Secretary of Defense to
certify that the service of an officer on active duty in a
grade above 0-8 was satisfactory in order for the officer to
be retired in the grade above 0-8, but would do away with the
requirement for the Secretary of Defense to provide that
certification in writing to the President and the Congress.
Further, Section 504 would require the Secretary of Defense
to issue written regulations to implement these procedures.
Section 505 would modify sections of titles 10, 37, and 20
of the United States Code to extend temporary military
drawdown authorities through Fiscal Year (FY) 2004. Most of
these authorities were initially established in the FY 1991
through FY 1993 National Defense Authorization Acts (NDAA).
They were designed to enable the Services to reduce their
military forces through a variety of voluntary and
involuntary programs and to provide benefits to assist
departing members in their transition to civilian life. The
FY 1994 NDAA extended these authorities through FY 1999. The
Department later requested a further extension through FY
2003, but the FY 1999 NDAA only extended them through FY
2001.
Section 505 would add no new or changed programs. Rather,
it would extend the expiration date by three years for
existing programs. Programs affected include: early
retirement authority, enabling Services to offer retirement
to members with 15 through 19 years of service; voluntary
separation incentive or special separation benefit (VSI/SSB),
which offers an annuity or lump sum payment to members
separating with between 6 and 19 years of service; waivers of
time-in-grade and commissioned service time requirements for
officers; and relaxation of certain selective early
retirement and reduction-in-force restrictions. Separate, but
similar, provisions are included for Reserve and Guard
forces. These programs are discretionary and Service
Secretaries, when authorized by the Secretary of Defense, may
determine whether or not to use the programs.
Transition benefits are otherwise not discretionary. Some
apply either to individuals involuntarily separated during
the drawdown period or to those accepting VSI or SSB. These
include a transition period in which the member and family
members continue to receive health care, commissary and
exchange benefits, use of military housing, extension of
separation or retirement travel, transportation, and storage
benefits for up to one year, and extension of the time
limitations on the Reserve Montgomery GI Bill. Others provide
transition benefits to all departing members during the
drawdown period, educational leave to prepare for post-
military community and public service, and continued
enrollment of dependents for up to one year to graduate from
Department of Defense Dependent Schools.
These programs have helped the Services take large
reductions in a short time. Although reductions have
stabilized and drawdown tools are not currently needed to
achieve overall end-strength, they may be
[[Page S7229]]
necessary to accomplish force-shaping reductions. In FY 1999
and 2000, the Air Force used early retirement, time in grade,
commissioned service time waivers, and VSI/SSB to accomplish
medical right-sizing and to alleviate a significant field
grade imbalance in the chaplain corps. In FY 2001 and beyond,
the Air Force anticipates a continued need for drawdown tools
(with associated benefit programs) to stabilize non-line end-
strengths. Future force-shaping initiatives could also
require limited use of drawdown tools.
Section 506. Subsection (a) adds a new section 1558 at the
end of chapter 79 of title 10:
Section 1558(a) authorizes the Secretary of the military
department concerned to correct the military records of a
person to reflect the favorable outcome of a special board,
retroactive to the date of the original board.
Section 1558(b) provides that, in the case of a person who
was separated, retired or transferred to an inactive status
as a result of the recommendation of a selection board and
later becomes entitled to retention on or restoration to
active duty or active status as a result of a records
correction under section 1558(a), the person shall be
restored to the same status, rights and entitlements in his
or her armed force as he or she would have had but for the
selection board recommendation. If the member does not
consent to such restoration, he or she will be entitled to
appropriate back pay and allowances.
Section 1558(c) provides that a special board outcome
unfavorable to the person considered confirms the action of
the original board, retroactive to the date of the original
board.
Section 1558(d) authorizes the Secretary concerned to
prescribe regulations to implement section 1558, including
prescribing the circumstances under which special board
consideration is available, when it is contingent on
application by the person seeking consideration, and time
limits for making such application. Such regulations, issued
by the Secretary of a military department, must be approved
by the Secretary of Defense.
Section 1558(e) provides that a person challenging the
action or recommendation of a selection board is not entitled
to judicial relief unless he or she has been considered by a
special board under section 1558, or has been denied such
consideration by the Secretary concerned. Denial of
consideration by a special board is made subject to judicial
review only on the basis that it is arbitrary, capricious,
not based on substantial evidence, or otherwise contrary to
law. If a court sets aside the Secretary's decision to deny
such consideration, it shall remand the matter to the
Secretary for consideration by a special board. The
recommendation of a special board, or a decision resulting
from that recommendation, is made subject to judicial review
only on the basis that it is contrary to law or involved a
material error of fact or a material administrative error. If
a court sets aside such a recommendation or decision, it
shall remand to the Secretary for new special board
consideration, or a new action on the special board's
recommendation, as the case may be. These limitations on
reviewability and remedies parallel those applicable to
reserve component selection boards under 10 U.S.C. 14502 and
are in accord with current Federal Circuit law regarding
review of military personnel decisions. Murphy v. U.S., 993
F.2d 871 (Fed. Cir. 1993). The term ``contrary to law'' is
intended to encompass constitutional as well as statutory
violations.
Section 1558(f) provides that the remedies prescribed in
section 1558 are the exclusive remedies available to a person
challenging the action or recommendation of a selection
board, as that term is defined in section 1558(j).
Section 1558(g) provides that section 1558 does not limit
the existing jurisdiction of any federal court to determine
the validity of any statute, regulation or policy relating to
selection boards, but limits relief in such cases to that
provided for in section 1558.
Section 1558(h) contains time limits for action by the
Secretary concerned on a request for consideration by a
special board (six months) and on the recommendation of a
special board (one year after convening the board). Failure
to act within these time limits will be deemed a denial of
the requested relief The Secretary, acting personally, may
extend these time limits in appropriate cases, but may not
delegate the authority to do so.
Section 1558(i) provides that section 1558 does not apply
to the Coast Guard when it is not operating as a service in
the Navy.
Section 1558(j)(1) defines ``special board'' to encompass
any board, other than a special selection board convened
under section 628 or 14502 of title 10, convened by the
Secretary concerned to consider a person for appointment,
enlistment, reenlistment, assignment, promotion, retention,
separation, retirement, or transfer to inactive status in a
reserve component, in place of consideration by a prior
selection board that considered or should have considered the
person. A board for correction of military or naval records
under section 1552 of title 10 may be a special board if so
designated by the Secretary concerned.
Section 1558(j)(2) defines ``selection board,'' for the
purposes of section 1558, as encompassing existing
statutorily established selection boards, (except a promotion
selection board convened under section 573(a), 611 (a) or
14101 (a) of title 10), and any other board convened by the
Secretary concerned to recommend persons for appointment,
enlistment, reenlistment, assignment, promotion, or retention
in the armed forces, or for separation, retirement, or
transfer to inactive status in a reserve component for the
purpose of reducing the number of persons serving in the
armed forces.
Subsection (b) adds new subsections (g), (h) and (i) to
section 628 of title 10, the section authorizing special
selection boards for promotion of active duty list
commissioned and warrant officers (redesignating existing
subsection (g) as subsection (j). New subsections (g) and (h)
correspond exactly to subsections (g) and (h) of section
14502 of title 10, the ROPMA provision authorizing special
selection boards for promotion of reserve active status list
commissioned officers.
New subsection (g) provides that no court or official of
the United States shall have power or jurisdiction over any
claim by an officer or former officer based on his or her
failure to be selected for promotion unless the officer has
first been considered by a special selection board, or his
claim has been rejected by the Secretary concerned without
consideration by a special selection board. In addition, this
subsection precludes any official or court from granting
relief on a claim for promotion unless the officer has been
selected for promotion by a special selection board.
Subsection (h) permits judicial review of a decision to
deny special selection board consideration. A court may
overturn such a decision and remand to the Secretary
concerned to convene a special selection board if it finds
the decision to be arbitrary or capricious, not based on
substantial evidence, or otherwise contrary to law. The term
``contrary to law'' is intended to encompass constitutional
as well as statutory violations. Subsection (i) also provides
that if a court finds that the action of a special selection
board was contrary to law or involved material error of fact
or material administrative error, it shall remand to the
Secretary concerned for a new special selection board. No
other form of judicial relief is authorized.
Subsection (i) provides (1) that nothing in this
legislation limits the existing jurisdiction of any court to
determine the validity of any statute, regulation or policy
relating to selection boards, but limits relief in such cases
to that provided for in this legislation, and (2) that
nothing in this legislation limits the existing authority of
the Secretary of a military department to correct a military
record under section 1552 of title 10.
Subsection (c) provides that the amendments made by this
legislation are retroactive in effect, except that they do
not apply to any judicial proceeding commenced in a federal
court before the date of enactment.
Section 511 would allow the Service Secretaries to
routinely transfer Reserve officers to the Retired Reserve--
without requiring that the officer request such a transfer--
for those officers who are required by statute to be removed
from the reserve active status list because of failure of
selection for promotion, length of service, or age. This
section would add a similar authority with respect to warrant
officers and enlisted members who have reached the maximum
age or years of service as prescribed by the Secretary
concerned. However, this section would allow these members to
request discharge or, in some cases, transfer to an inactive
status list in lieu of transfer to the Retired Reserve.
Giving the Service Secretaries this authority would also help
protect those members who entered military service after
September 7, 1980. Members who entered military service after
that date and are discharged after qualifying for a non-
regular retirement (former members) remain eligible to
receive retired pay, but that pay is calculated on the pay
scale in effect when discharged, rather than the pay scale in
effect when they request retired pay. This is significant
since the retired pay for a former member in most cases will
be significantly less then that of a member of the Retired
Reserve because of the pay scale used to determine the amount
of retired pay. This amendment would require reservists to
make a positive election to be discharged with the full
understanding of the possible economic consequences of that
decision.
Section 512. A specific definition with respect to Reserve
component members was added as section 991(b)(2) of title 10,
United States Code, by the Floyd D. Spence National Defense
Authorization Act for Fiscal Year 2001 (Public Law 106-398).
The purpose of this definition was to ensure consistent
treatment of Active and Reserve component members serving
under comparable circumstances and preclude Reserve component
members from being credited with deployed days when they
could spend off-duty time in their home.
As provided in the National Defense Authorization Act for
Fiscal Year 2001, the Active component will count ``home
station training'' for deployment purposes whenever the
member is unable to spend off-duty hours in the housing in
which he or she resides when on garrison duty at his or her
permanent duty station or homeport. To maintain consistency
between Active and Reserve component members, the definition
of deployment with respect to Reserve component members must
be amended.
Absent the proposed change in Section 512, an active duty
member who is not able to spend off-duty time in the housing
in which the member resides when on garrison duty at the
member's permanent duty station or
[[Page S7230]]
homeport, because the member is performing home station
training, will be credited with a day of deployment, while a
Reserve component member serving under comparable
circumstances will not because they will be within the
100-mile or three-hour limit. Section 512 would ensure
consistency between Active and Reserve component members
with respect to the PERSTEMPO definition.
Section 513 would eliminate the periodic physical
examination requirement for members of the Individual Ready
Reserve (IRR), which is required once every five years. In
lieu of conducting a physical examination every five years,
these members would receive a physical examination upon a
call to active duty, if they have not had a physical
examination within the previous five years. However, the
Secretary concerned would have the authority to provide a
physical examination when necessary to meet military
requirements. There is little return on investment for any
program to conduct physical exams for the more than 450,000
members of the IRR. The annual cost of ensuring that IRR
members are examined as to physical condition at least every
five years is approximately $2.3 million. This cost reflects
approximately 10 percent of what the Department should be
spending annually on physical exams for this population.
However, the Department is able to provide only about 11,000
of the more than 90,000 required physical exams for IRR
members each year. In this period of constrained resources,
it would be far more cost-effective to conduct physical exams
on these Reserve members at the time they are ordered to
active duty. This recommendation was contained in the
Secretary of Defense's report to Congress on the means of
improving medical and dental care for Reserve Component
members, which was sent to Congress on November 5, 1999.
Section 514 would amend titles 10, 14 and 38, United States
Code (U.S.C.), to provide the same benefits and protections
for Reserve Component (RC) members while in a funeral honors
duty status as provided when RC members perform inactive duty
training (IDT) or traveling to or from IDT. Sections to be
amended are:
(1) 10 U.S.C. 802--persons subject to the Uniformed Code of
Military Justice. Section 514 would specify that members of a
Reserve Component are subject to the Uniform Code of Military
Justice while performing funeral honors duty under 10 U.S.C.
12503.
(2) 10 U.S.C. 1061--eligibility for commissary and exchange
benefits for dependents of a deceased Reserve Component
member. Section 514 would specify that the dependents of a
Reserve Component member who died while in a funeral honor
duty status, or while traveling to or from such duty would be
eligible for commissary and exchange benefits on the same
basis as the surviving dependents of an active duty member.
(3) 10 U.S.C. 1475 and 1476--payment of a death gratuity.
Section 514 would authorize payment of a death gratuity upon
the death of a Reserve Component member who died while in a
funeral honor duty status, or while traveling to or from such
duty.
(4) 14 U.S.C. 704--military authority of members of the
Coast Guard Reserve. Section 514 would specify that a member
of the Coast Guard Reserve would have the same authority,
rights and privileges as a member of the Regular Coast Guard
of a corresponding grade or rating when the member is in a
funeral honors duty status.
(5) 14 U.S.C. 705--benefits for members of the Coast Guard
Reserve. Section 514 would specify that a member of the Coast
Guard Reserve would have the same benefits as a member of the
Naval Reserve of corresponding grade, rating and length of
service when the member is in a funeral honors duty status.
(6) 38 U.S.C. 101--definitions. Section 514 would add the
term ``funeral honors duty'' and define that term, and then
include that term in the definition of ``active military,
naval, or air service.'' Including the definition of funeral
honors duty in the term active military, naval and air
service, would entitle a Reserve Component to healthcare and
disability compensation from the Department of Veterans
Affairs for a service-connected disability incurred or
aggravated while in a funeral honors duty status or traveling
to or from such duty.
Amending the various statutes to add funeral honors duty as
a duty status in which these benefits are provided is
important to ensure a viable program of rendering honors at
the funerals of our veterans.
Section 515 would specify that the performance of funeral
honors by members of the Army National Guard of the United
States or Air National Guard of the United States, while in a
state status, satisfies the two-person funeral honors detail
requirement. While members of the National Guard would meet
this requirement when called to duty under a provision of
title 10 or title 32, United States Code (U.S.C.), they are
not in a federal status when performing duty in a state
military duty status, and therefore would not fulfill the
two-person requirement for performing funeral honors when in
a state status. Amending 10 U.S.C. 1491 to permit National
Guard members to fulfill this requirement when performing
duty in a state status would help ensure this important
mission is accomplished.
Section 516 would authorize Reserve Component members who
have been ordered to active duty under section 12301(d) of
title 10, United States Code (U.S.C.), to serve in support of
a contingency operation (as defined in 10 U.S.C. 101(a)(13)),
to be added to the authorized active duty end strength. It
would also authorize the ceiling for general and flag
officers and officers in the grades of O-6, O-5 and O-4
serving on active duty in those grades to be increased by a
number equal to the number of officers in each pay grade
serving on active duty in support of a contingency operation.
Lastly, it would authorize the ceiling for enlisted members
in the grades of E-9 and E-8 serving on active duty in those
grades to be increased by a number equal to the number of
enlisted members in each pay grade serving on active duty in
support of a contingency operation.
Currently, Reserve Component members who are involuntarily
called to active duty are exempt from the strength
limitations in sections 115, 517 and 523 of title 10. Just as
the Services involuntarily call Reserve Component personnel
to active duty under section 10 U.S.C. 12304, to meet the
operational requirements to support a contingency, the
Services also use volunteers from their Reserve Components to
meet the operational requirements of a contingency
operation. These volunteers are called to active duty
under 10 U.S.C. 12301(d). Regardless of the authority
used, a voluntary call to active duty or an involuntary
call to active duty, the additional manpower represents an
unprogrammed expansion of the force to meet operational
requirements. The authority to increase the end strength
limits and grade ceilings would permit the Services to
meet contingency operation requirements without adversely
affecting the manpower programmed for other national
security objectives. Finally, absent such an authority,
the Services have an incentive to use non-volunteers to
support these operations to avoid adversely affecting
their end strength. This authority to expand the force by
the number of Reserve Component members serving on active
duty to support the contingency would encourage the
Services to use volunteers to meet these mission
requirements.
Section 517 would authorize payment of the financial
assistance provided under 10 U.S.C. 16201 to a student who
has been accepted into an accredited medical or dental
school. Section 517 would further amend section 16201 to
authorize payment of subsequent financial assistance to an
officer who received financial assistance under this section
while a student enrolled in medical or dental school and has
now graduated and enters residency training in a healthcare
professions wartime skill designated by the Secretary of
Defense as critically short. When such a student agrees to
financial assistance for residency training, the two-for-one
service commitment previously incurred for financial
assistance while attending medical or dental school may be
reduced to one year for each year, or part thereof, of
financial assistance previously provided. However, the
service obligation incurred for residency training would
remain at two-for-one. Finally, Section 517 would authorize
the service obligation incurred for financial assistance for
a partial year to be incurred in six-month increments for
those agreements that require a two-for-one pay back. Thus,
for every six months, or part thereof, of benefits paid under
this program the recipient would be obligated for one year of
service in the Selected Reserve. Currently, two years of
service obligation is incurred for each partial year of
financial assistance provided, regardless of the number of
months in that partial year.
These amendments would provide a more robust incentive
program that recruiters could offer students in the
healthcare professions in order to entice them into joining
the Guard or Reserve. The current medical recruiting
incentives, which originated in the early to mid 1980s, must
be updated to enable reserve recruiters to compete with
hospitals, HMOs and communities who offer financial
incentives to medical and dental students in return for a
commitment to work for them once they become a qualified
physician or dentist. As an example, both the Army Reserve
and the Army National Guard, which account for 65 percent of
Army medical requirements, have not been able to achieve
medical recruiting goals and are experiencing serious medical
end strength shortfalls.
In summary, Section 517 would enhance the recruiting
incentives targeted at students entering the health care
profession in four ways: (1) allow medical and dental school
students to receive a stipend, (2) allow subsequent financial
assistance for officers who have completed medical or dental
school and enter residence training in a critically short
wartime skill, (3) allow the service obligation to be reduced
to one-for-one when a physician or dentist accepts additional
financial assistance for residency training, and (4) allow
those service obligations which require a two-for-one pay
back to be incurred in six-month increments.
Section 518. Section 521 of the Floyd D. Spence National
Defense Authorization Act for Fiscal Year 2001 (Public Law
106-398) amended section 641(1) of title 10, United States
Code (U.S.C.), to exclude certain reserve component officers
serving on active duty for periods of three years or less
from the active duty list for promotion purposes. The
amendment inadvertently excluded a number of reserve officers
on active duty for three years or less who should properly be
considered on the active duty list. For example, Senior
Reserve Officers' Training Corps non-scholarship graduates
who attend law school in an educational delay status are
ordered to active duty for a period of three years and, as a
result of the recent amendment, are placed on the reserve
active-status
[[Page S7231]]
list, rather than on the active duty list. These officers,
however, should compete for selection for promotion with
their contemporaries on the active duty list, e.g., officers
who are ordered to active duty for a period of four years as
a consequence of their participation in the Senior Reserve
Officers' Training Corps scholarship program.
Section 518 would amend section 641 to provide that reserve
officers ordered to active duty for three years or less would
be placed on the reserve active-status list only if their
placement was required by regulations prescribed by the
Secretary concerned and only if ordered to active duty for
three years or less with placement on the reserve active-
status list specified in their orders,. This amendment would
provide the Secretaries of the military departments with the
authority to prevent an inappropriate application of section
641(1)(D).
However, Section 518 would allow Reserve officers who are
called to active duty to meet mission requirements of the
active forces to be released to resume a reserve career
following a limited period of active duty (three years or
less) and to be considered for promotion by a reserve
promotion selection board and managed under the provisions of
subtitle E of title 10, U.S.C., in the same manner as their
contemporaries not serving on active duty. Reserve component
general/flag officers would, under service regulations, be
retained on the reserve active-status list while serving on
active duty for a period of three years or less under the
provisions of 10 U.S.C. 526(b)(2).
Finally, Section 518 would allow the service secretary to
return a Reserve officer to the reserve active status list
who otherwise met the criteria of this exemption, but for the
fact that the officer was on active duty and had already been
placed on the active duty list at the time section 641(1)(D),
as amended by Public Law 106-398, was enacted.
Section 519 would permit Reserve component members on
active duty and members of the National Guard on full-time
National Guard duty to prepare for and perform funeral honors
for veterans as required by section 1491 of title 10, United
States Code, without counting against active duty end
strength. The delivery of funeral honors to veterans is a
continuous peacetime mission that has escalated from its
recent inception and mandate in Public Law 105-261. Further,
funeral honors mission requirements are projected to
continue their expansive growth in the out years. Section
519 would allow the Services to fulfill the funeral honors
mission without adversely impacting readiness and
affecting the end strength needed to meet their wartime
missions. For the Department to meet the requirements of
the law regarding the provision of funeral honors for
veterans, it is critical to have Reserve component
participation in this Total Force mission. This end
strength exemption would remove an impediment to greater
Reserve component participation in funeral honors, provide
greater latitude in manpower application, and greatly
assist the Department in meeting the expanding
requirements of the veterans' funeral honors law.
Section 520. Section 555 of the National Defense
Authorization Act for Fiscal Year 2000 amended section
12310(b) of title 10, United States Code, to expand the
duties that may be assigned to Reserves, who are on active
duty, in connection with organizing, administering,
recruiting, instructing, or training the reserve components.
While the apparent intent of the amendment was to expand the
permissible activities of all Active Guard and Reserve (AGR)
personnel, practically, the amendment applies only to AGR
personnel performing active duty under section 12301(d) of
title 10 and does not include AGR personnel performing full-
time National Guard duty under title 32 of the United States
Code. Therefore, Section 520 seeks to clarify the current
law, aligning the current practices in these missions with
the legislative authority governing them. This change is
necessary because, effectively, there are few distinctions
between the roles of AGR personnel serving on active duty and
the roles of reservists performing full-time National Guard
duty, outside of the different chains of command that each
respective group must report to.
This section would amend section 12310(b) by inserting
language that clearly would make the section applicable to
Reserves who are members of the National Guard serving on
fulltime National Guard duty under section 502(f) of title 32
in connection with organizing, administering, recruiting,
instructing, or training the reserve components. It would
ensure that National Guard AGR personnel are treated in the
same manner as AGR personnel of the other reserve components
when determining the scope of permissible duties and
functions that they may perform. Section 520 would clarify
the authority for AGR personnel on full-time National Guard
duty to support an increasing number of operations and
missions being assigned in whole or in part to the National
Guard. Such duties include operational airlift support
activities, standby air defense operations, anticipated
ballistic missile defense operations, land information
warfare activities, and the use of National Guard instructors
to train both active component and reserve component
personnel. Thus, this section is important because, while
some of these duties have been periodically performed by AGR
personnel on full-time duty, there has been no explicit,
binding, legal authority which would outline the limits
governing their actions.
Section 521 would amend section 516 of the Strom Thurmond
National Defense Authorization Act for Fiscal Year 1999
(Public Law 105-261) to extend the time during which the
Secretary of the Army may waive the applicability of section
12205(a) of title 10, United States Code, to reserve officers
commissioned through the Army Officer Candidate School.
Section 12205(a) provides that no person may be appointed
to a grade above the grade of first lieutenant in the Army
Reserve, Air Force Reserve, or Marine Corps Reserve or to a
grade above the grade of lieutenant (junior grade) in the
Naval Reserve, or be federally recognized in a grade above
the grade of lieutenant as a member of the Army National
Guard or Air National Guard, unless that person has been
awarded a baccalaureate degree by a qualifying educational
institution.
Section 516 authorized the Secretary of the Army to waive
the applicability of section 12205(a) to any officer who
before the enactment of Public Law 105-261 was commissioned
through the Army's Officer Candidate School. The waiver may
continue in effect for no more than two years. A waiver under
the section may not be granted after September 30, 2000.
Section 521 would amend section 516 to permit the Secretary
to waive the applicability of section 12205(a) to any officer
who was commissioned through the Army's Officer Candidate
School without regard to the date of commissioning and would
extend the Secretary's authority under the section to
September 30, 2003.
This additional period would enable the Army to determine
how to alleviate the problems experienced by some officers
commissioned through the Army Officer Candidate School in
obtaining a baccalaureate degree during the relatively short
period before they are eligible for promotion to captain and
during times when they may be engaged either in intense
training or deployments for long periods.
Section 522 would amend section 12305 of title 10, United
States Code, to afford members whose mandatory dates of
separation or retirement were delayed due to stop loss
action, a period of time to transition to civilian life
following termination of stop loss. Specifically, Section 522
would add subsection (c) to afford active duty members whose
mandatory separations or retirements incident to sections
1251 or 632-637 are delayed pursuant to invocation of section
12305, a period of time--not to exceed 90 days following
termination of suspensions made under section 12305--to
transition to civilian life.
As currently written, section 12305 requires immediate
separation or retirement of those affected by stop loss, who,
without stop loss, would have been subject to mandatory
separation or retirement under this title for age (section
1251), length of service (sections 633-636), or promotion
(sections 632, 637). An abrupt termination of stop loss could
cause undue hardship on those whose planned departure to
civilian life was unexpectedly interrupted and now must be
resumed posthaste. For example, the Air Force invoked stop
loss in support of Operation Allied Force in 1998. Following
the termination of stop loss on 22 June 1998, eight officers
with a mandatory (by law) date of separation were required to
retire upon their original date of separation (1 July 1998);
another three officers were required to separate/retire by 1
August 1998. On the other hand, members with a date of
separation set by policy were given the option of either
extending their dates of separation up to 6 months or
withdrawing them. Some leeway must also be provided for
members with dates of separation established by law to
reschedule the many details incident to final departure from
military life.
Section 531. The Marine Corps War College seeks
Congressional authority and regional accreditation to issue a
master's degree in Strategic Studies. The authority to begin
this process is vested in the Commanding General of the
Marine Corps Combat Developments Command and was authorized
on 1 June 2000. In December 1999, the Marine Corps University
achieved a seven-year goal by becoming accredited by the
Southern Association of Colleges and schools to award a
master's degree in Military Studies. While this accreditation
was awarded to the Marine Corps University, it specifically
addressed only the degree awarded by the Command and Staff
College. The Marine Corps War College now seeks similar
authority.
The uniqueness of the Marine Corps War College's curriculum
and program of study is unparalleled by other civilian
universities or Federal War Colleges. Most of the Marine
graduates of the Marine Corps War College become faculty
members of the Command and Staff College and, since the
Command and Staff College already awards a master's degree,
it would be very beneficial for these future faculty members
to possess the required academic credentials when arriving at
their new positions at the Command and Staff College.
A master's degree program would enhance the professional
reputation and prestige of the Marine Corps War College. This
would facilitate the Marine Corps War College's efforts to
sustain and recruit a world class faculty and demonstrate a
high level of faculty competence as first rate scholars and
speakers. Section 531 is intended only as a technical
amendment to the existing legislation. Enactment of this
section would not result in an increase in the budgetary
requirements of the Marine Corps.
[[Page S7232]]
Section 532. Section 206(d) of title 37, United States
Code, states that ``[t]his section does not authorize
compensation for work or study by a member of a reserve
component in connection with correspondence courses of an
armed force.'' This is similar to the limitation in the
definition of ``inactive-duty training'' found in 37 U.S.C.
101(22), which states inactive-duty training ``does not
include work or study in connection with a correspondence
course of a uniformed service.''
Since the correspondence course restrictions were enacted
more than 50 years ago, technological advances affecting
instructional methodology have made these restrictions
outdated. The law, as currently written, also contradicts
recent Congressional directions to maximize the use of
technologies such as telecommuting for the federal sector and
the National Guard's Distributed Technology Training Project
(DTTP).
The Secretary of Defense's training technology vision is to
``ensure that DoD personnel have access to the highest
quality education and training that can be tailored to their
needs and delivered cost effectively, anytime and anywhere.''
The future learning environment created by the application of
new technology will extend learning opportunities for Service
members, active and reserve, around the globe. This
technology will be available at work (whether at a military
base or in the civilian sector), at home, and at individual
workstations provided for public use at libraries and
military classrooms. Distributed Learning is defined as
structured learning that takes place without requiring the
physical presence of an instructor. Distributed learning is
synchronous and/or asynchronous learning mediated with
technology and may use one or more of the following media:
audio/videotapes, CD-ROMs, audio/video teletraining,
correspondence courses, interactive television, and video
conferencing. Advanced Distributed Learning is an evolution
of distributed, or distance, learning that emphasizes
collaboration on standards-based versions of reusable
objects, networks, and learning management systems, yet may
include some legacy methods and media.
The awarding of compensation and/or credit involving
innovative learning technologies should be for the successful
independent completion of the required learning based on
Service standards. It is the Service Secretary's
responsibility to establish what is ``required'' learning for
the purposes of compensating and/or awarding credit to
Reserve component personnel. In this context, ``required''
learning means education/training that is necessary for
individual and/or unit readiness as called for by law, DoD
policy, or Service regulation. Required distance/distributed
learning and/or advanced distributed learning courses may
have some paper-based phases or modules and can be
compensated. In addition, it is the Service secretary's
responsibility to develop the policies and procedures to
ensure successful and accountable implementation of their
Reserve component's Distributed Learning programs. Such
policies and procedures should include, but not be limited
to, such topics as tracking members' participation at a
distance, measuring successful performance/participation,
failure policies, telecommuting policies, equipment funding
and availability, equipment liability, personal liability,
virtual training, virtual drilling, scheduling,
documentation, accountability, and implementation guidance.
Section 532 would make no change in resource requirements
because budgetary decisions associated with the compensation
and/or credit for Reserve component members for work
performed through non-traditional methods is left up to the
discretion of the Service Secretaries.
Section 533 would modify section 2031 of title 10, United
States Code, to strike the second sentence in paragraph
(a)(1) which reads as follows: ``The total number of units
which may be established and maintained by all of the
military departments under authority of this section,
including those units already established on October 13,
1964, may not exceed 3,500.''
JROTC is DoD's largest youth program with over 450,000
students enrolled in more than 2,900 secondary schools. The
statutory mission for JROTC is to instill in students the
value of citizenship, service to the United States, personal
responsibility, and a sense of accomplishment. Surveys of
JROTC cadets indicate that about 40 percent of the graduating
high school seniors with more than two years participation in
the JROTC program are interested in some type of military
affiliation (active duty enlistment, officer program
participation, or service in the Reserve or Guard).
Translating this to hard recruiting numbers, in Fiscal
Years (FY) 1996-2000, about 9,000 new recruits per year
entered active duty after completing two years of JROTC.
The proportion of JROTC graduates who enter the military
following completion of high school is roughly five times
greater that the proportion of non-JROTC students.
Therefore, the program pays off in citizenship as well as
recruiting.
Recognizing the merits of the JROTC program, the Military
Services have undertaken an aggressive expansion program and
are committed to reach the statutory maximum of 3,500 by FY
2006. As a result of this planned growth, the Military
Services have witnessed a marked increase in the number of
schools seeking establishment of JROTC units. We now face the
real potential that DoD and a waiting school might both wish
to proceed with an activation, yet face a legislative cap
that prevents execution of such a mutually-desirable course
of action. Enactment of Section 533 would permit DoD to be
responsive to mutually agreeable school needs which might
exceed the present 3,500-unit cap set in law.
Section 534 would extend eligibility for the Nurse Officer
Candidate Accession Program to students enrolled at civilian
educational institutions with a Senior Reserve Officers'
Training Program (SROTP) who are not eligible for Senior
Reserve Officers' Training Programs.
The Nurse Officer Candidate Accession Program (NCP) is a
primary accession source of new nurse officers and provides a
hedge against difficulty in the direct procurement market. It
provides financial assistance to students enrolled in a
baccalaureate nursing program in exchange for an active duty
commitment upon graduation.
Market projections indicate increasing difficulty in
recruiting students for the NCP due to an increase in
civilian career opportunities and declining nursing school
enrollment. Evidence from nursing journals and employment
industry statistics confirm that a tightening job market for
nurses is expected over the next few years.
Section 213Oa of title 10, United States Code, currently
restricts eligibility for the NCP to students enrolled in a
nursing program at a civilian educational institution ``that
does not have a Senior Reserve Officers' Training Program.''
Eligibility requirements for the SROTP limit age to 27
years. SROTP scholarships for junior or senior level students
are limited to a few quotas each year only to replace
students lost through attrition. The NCP age limit is up to
34 years and only bars those within six months of graduation.
Recruiters report considerable interest in the NCP program by
SROTP-ineligible students.
Extending NCP eligibility to SROTP-ineligible students
would expand the potential applicant pool and demonstrate
strong Congressional support and commitment to providing
future nurse officers with the necessary skills to meet our
healthcare mission around the world.
Section 535. The Defense Language Institute Foreign
Language Center serves as the Defense Department's primary
foreign language teaching and resource center. The Institute
has been accredited by the Accrediting Commission for
Community and Junior Colleges of the Western Association of
Schools and Colleges (Commission) since 1979. The Commission
has recommended that the Institute obtain degree-granting
status to maintain its accreditation. The Secretary of
Education has endorsed that recommendation. Section 535 would
provide the authority for the Institute to grant an Associate
of Arts degree. There are no resource implications other than
the routine administrative requirements to produce a diploma
suitable for presentation upon graduation.
Section 541 is pursuant to the provisions and procedures of
section 1130 of title 10, United States Code. The Honorable
Sherrod Brown of the House of Representatives requested the
Secretary of the Army, the appropriate official under section
1130, to review the circumstance of this case. Section 541
follows the determination made under section 1130(b)(2) that
the award of the decoration warrants approval. It further
recommends a waiver of the specified time restrictions
prescribed by law. The Secretary of the Army and the Chairman
of the Joint Chiefs of Staff both agree and recommend that
Humbert R. Versace be awarded the Medal of Honor. Section 541
would waive the period of time limitations under Section 3744
of title 10 to authorize the President to award Humbert R.
Versace the Medal of Honor.
Section 541 would authorize the President to award the
Medal of Honor to Humbert R. Versace, who served in the
United States Army during the Vietnam War and who was
assigned as a Captain with A Detachment, 5th Special Forces
Group. It would waive the specific provisions of section 3744
of title 10 that the award be made within three years of the
date of the act upon which the award is based. The acts of
then-Captain Humbert R. Versace clearly distinguish him
conspicuously by gallantry and intrepidity at the risk of his
life above and beyond the call of duty, as required by
section 3741 of title 10 to merit this legislation and the
award.
Section 542 would amend sections 3747, 6253 and 8747 of
title 10, United States Code, to provide clear authority for
the Secretaries of the military departments to replace
certain medals if stolen and to issue medal of honor
recipients one duplicate medal of honor, with ribbons and
appurtenances.
Sections 3747, 6253 and 8747 currently authorize free
replacement of any medal of honor, distinguished service
cross, distinguished service medal, silver star, Navy cross,
Navy and Marine Corps medal, or Air Force cross that is lost
or destroyed or becomes unfit for use without the fault or
neglect of the recipient. Enactment of Section 542 would also
clarify the intent of these sections to authorize
specifically the replacement of medals that are stolen,
subject to the limitation that the theft was without the
fault or neglect of the recipient.
If enacted, Section 542 would also authorize the Service
Secretaries to issue each medal of honor recipient one
duplicate medal free of charge. There is no provision in
title 10 that authorizes issuance of a duplicate medal of
honor so that the recipient can donate the original medal
or otherwise safeguard it and wear the duplicate to
functions
[[Page S7233]]
and events. In fact, sections 3747, 6253 and 8747 of title
10, in conjunction with sections 3744(a), 6247 and 8744(a)
of such title, may be construed to prohibit the issuance
of a duplicate medal of honor.
If Section 542 is enacted, medal of honor recipients would
have to make written application to the Secretary concerned
for the issuance of a duplicate medal, which would be marked,
as determined by the Secretary concerned, as a duplicate or
for display purposes only. The issuance of a duplicate medal
under this new authority would not constitute the award of
``more than one'' medal of honor to the same person. Sections
3744(a), 6247 and 8744(a) of title 10 prohibit the award of
``more than one'' medal of honor to a person.
Issuance of a duplicate medal of honor for display purposes
would allow recipients to place their original medals in
safekeeping or donate them to institutions for permanent
display while retaining the duplicate to wear at events.
Medal of honor recipients are expected to wear their medals
at many of the events to which they are invited. According to
the Congressional Medal of Honor Society, many of the 152
living recipients would like to donate or otherwise safeguard
their original medals because the value of the medals on the
``black market'' has made them an attractive target for
theft. Medals marked as duplicates, by contrast, would
presumably have little or no ``black market'' value and would
be less attractive targets for theft.
The cost of issuing duplicate medals of honor would be
minimal. The current cost of a medal of honor is
approximately eighty-five dollars. If every living recipient
requested a duplicate, the cost would not exceed $15,000,
including shipping.
Section 543. Section 541 of the Floyd D. Spence National
Defense Authorization Act for FY 2001 (114 Stat. 1654A-114)
enacted section 1133 of title 10, United States Code
(U.S.C.), that restricts eligibility for the Bronze Star
Medal to members of the Armed Forces who are in receipt of
special pay under section 310 of title 37, U.S.C., at the
time of the events for which the decoration is to be awarded
or who receive such pay as a result of those events.
``Special pay'' under section 310 includes both hostile fire
pay (HFP) and imminent danger pay (IDP). The reason for the
change stemmed from the belief that someone whose duties
never took them away from home did not perform the same kind
of service as someone who was in the combat zone. The
perception was that most people who received IDP or HFP
served in a combat zone.
Currently, military personnel serve in 43 areas which
qualify for IDP or HFP, but only two areas are further
designated ``combat zones''--Yugoslavia (Serbia, Kosovo,
Albania, the Adriatic Sea, the Ionian Sea above the 39th
parallel, and the airspace above these areas) and the Persian
Gulf. Service members qualify for IDP not only in wartime
conditions, but also if they are subject to physical harm or
imminent danger due to terrorism, civil insurrection, or
civil war. HFP is awarded when a service member is subject to
hostile fire or explosion of hostile mines; on duty in an
area in which he is in imminent danger of being exposed to
hostile fire or explosion of hostile mines; or is killed,
injured, or wounded by hostile fire, explosion of a hostile
mine, or any other hostile action. The decision to declare an
area eligible for receipt of IDP or HFP is not immediate. A
recommendation is made by the regional commander in chief,
endorsed by the Joint Chiefs of Staff, and then approved by
DoD Force Management Policy.
No other higher-level valor award, e.g., the Medal of
Honor, Service Cross, Silver Star, or Distinguished Flying
Cross, has similar eligibility criteria. Historically, the
Bronze Star Medal has been awarded outside of combat areas,
such as during the Korean conflict when it was approved for
personnel stationed in Okinawa for meritorious service in
connection with military operations against Northern Korea.
Therefore, limiting eligibility for the Bronze Star Medal to
only those members serving in an area where imminent danger
pay is authorized or to those receiving hostile fire pay
would exclude many deserving members of the Armed Forces.
Awarding of the Bronze Star Medal should be disassociated
with any requirement for IDP or HFP and should instead stand
alone. The revolution in military warfare has changed the way
the U.S. has traditionally viewed force application and the
decorations, many of whose origins recognized traditional
ground combat operations, must also keep up and recognize the
changes in the way the U.S. conducts warfare.
Section 551 would amend the Uniform Code of Military
Justice to lower the blood alcohol concentration (BAC)
necessary to establish drunken operation of a motor vehicle
from 0. 1 to 0.08 grams or more of alcohol per 100
milliliters of blood or 0.08 grams per 210 liters of breath.
This change would bring military practice in line with the
recently enacted nationwide drunk driving standard found in
section 351 of the Department of Transportation and Related
Agencies Appropriations Act for Fiscal Year 2001, Public Law
106-346, 114 Stat. 1356A-34.
On March 3, 1998, President Clinton directed the Secretary
of Transportation to develop a plan to promote a .08 BAC
legal limit, which would include ``setting a. 08 BAC standard
on Federal property, including. . . on Department of Defense
installations, and ensuring strong enforcement and publicity
of this standard. . . .''
Consistent with this planning effort, DoD legislation was
proposed in its omnibus legislative package in the spring of
1999 to amend the Uniform Code of Military Justice to reduce
the blood and breath alcohol levels for the offense of
drunken operation of a vehicle, aircraft, or vessel from 0.10
to 0.08 grams. The U.S. Senate adopted section 562 of S. 974
to make corresponding changes to the United States Code. H.R.
1401, as adopted by the U.S. House of Representatives,
contained no similar provision. The Senate receded in
Conference on this provision. S. 1059 was then substituted
and enacted, signed by the President, and became Public Law
106-65.
The Conference Committee Report to S. 1059, National
Defense Authorization Act for Fiscal Year 2000, requested the
Secretary of Defense to submit a report to the Armed Services
Committees ``on the Department's efforts to reduce alcohol-
related disciplinary infractions, traffic accidents, and
other such incidents. The report should include the
Secretary's recommendations for any appropriate changes.''
The Conference Report noted that a recent General
Accounting Office (GAO) study concluded that statutory
reductions, by themselves, did not appear sufficient to
reduce the number and severity of alcohol-related
accidents.
The GAO study cited by the Conference Report is entitled
``Highway Safety: Effectiveness of State .08 Blood Alcohol
Laws'' (June 1999). This GAO report concludes that ``.08 BAC
laws in combination with other drunk driving laws as well as
sustained public education and information efforts and strong
enforcement can be effective, [but] the evidence does not
conclusively establish that .08 BAC laws by themselves result
in reductions in the number and severity of crashes involving
alcohol.'' GAO Report at 22-23.
The GAO report further found that ``it is difficult to
accurately predict how many lives would be saved if all
states passed .08 BAC laws. The effect of a .08 BAC law
depends on a number of factors, including the degree to which
the law is publicized; how well it is enforced; other drunk
driving laws in effect; and the unique culture of each state,
particularly public attitudes concerning alcohol.'' GAO
Report at 23. ``A .08 BAC law can be an important component
of a state's overall highway safety program, but a .08 BAC
law is not a `silver bullet'. Highway safety research shows
that the best countermeasure against drunk driving is a
combination of laws, sustained public education, and vigorous
enforcement.'' GAO Report at 23.
Since 1983, DoD has pursued a ``comprehensive approach'' to
reduce drunk driving, believing that the best countermeasure
against drunk driving is a combination of laws, public
education, and enforcement. This comprehensive range of
programs currently include: a 0.10 blood alcohol
concentration (BAC) statute enforceable by court-martial;
strong policies to achieve a reduction in impaired driving; a
system for preliminary and mandatory suspension of licenses
in cases of impaired driving; innovative education and
training programs; a screening program for identifying
alcohol dependent individuals; a process to notify State
driver's license agencies regarding licenses suspended for
impaired driving; a local awards program for successful
impaired driving programs; and a system to monitor and ensure
quality control for impaired driving programs.
Together, these programs have resulted in a reduction in
alcohol-related traffic accidents for DoD personnel which
compares favorably to analogous statistics of the National
Highway Traffic Safety Administration (NHTSA) for the 50
states and the District of Columbia.
DoD recommends that the effectiveness of the existing DoD
programs be further enhanced through the amendment of Article
111(2) of the Uniform Code of Military Justice, 10 U.S.C.
Sec. 911(2), to reduce the enforceable BAC level to 0.08.
Reducing the BAC level to 0.08 would be consistent with
statutes or administrative policies already in effect in 19
States, the District of Columbia, and Puerto Rico. Six
additional States currently have under consideration
legislation to change to the 0.08 BAC level. If enacted, DoD
believes the 0.08 BAC limit would be an important
component of our overall traffic safety program and
support a significant reduction in the annual number of
alcohol-related fatal and non-fatal crashes involving DoD
personnel, with corresponding human and economic savings.
Section 601 The primary purpose of military compensation is
to provide a force structure that can support defense
manpower requirements and policies. To ensure that the
uniformed services can recruit and retain a force of
sufficient numbers and quality to support the military,
strategic and operational plans of this nation, military
compensation must be adequate. Comparison of the earnings of
military members with their civilian counterparts suggests
that without some adjustment to both the level and structure
of basic pay, the military will continue to face serious
difficulties in both recruiting and retention.
The results of the military and civilian earnings profile
comparisons and the life-cycle earnings analysis conducted by
the 9th Quadrennial Review of Military Compensation (9th
QRMC) lead to several recommendations that both raise the
level of pay and alter the structure of the pay table as
well. The structural modifications include targeting pay
raises to the enlisted mid-grade ranks that will better match
their earnings profile, over a career, with that of
[[Page S7234]]
comparably-educated civilian counterparts and provide a
sufficient incentive for these members to complete a military
career. Recommended adjustments:
Target large basic pay increases for enlisted members
serving in the E-5 to E-7 grades with 6-20 years of service.
This would alter the pay structure and thus the shape of the
earnings profile, increasing the slope of the earnings
profile for midgrade enlisted members to partially achieve
the levels suggested by the 9th QRMC.
Raise basic pay for grades E-8 and E-9, to maintain
incentives throughout the enlisted career and prevent pay
inversion.
Provide a modest increase in basic pay for junior enlisted
members. This increase reflects the importance of preventing
further deterioration in the percentage of high quality
recruits.
Provide for structural changes in selected pay cells for
E3, E4, and E5 to motivate members to seek early promotion in
the junior grades.
Raise basic pay for grades O-3 and O-4 to provide increased
retention incentives.
Provide a modest increase for other officers to recognize
their contribution to the defense effort.
Subsection (a) waives the adjustment in basic pay that is
prescribed in section 1009 of title 37, United States Code.
Subsection (b) provides a pay table describing the changes in
basic pay. These increases are summarized in the table on the
following page:
------------------------------------------------------------------------
Percentage Percentage
Grade increase Grade increase
------------------------------------------------------------------------
E-1 6.0 W-1 8.5*
E-2 6.0 W-2 8.5*
E-3 6.0* W-3 8.0
E-4 6.6* W-4 7.5
E-5 7.5* W-5 7.0
E-6 7.5* O-3 6.0
E-7 8.5 O-4 6.5
E-8 9.0 others 5.0
E-9 9.5* ................. ...............
------------------------------------------------------------------------
*The following pay cells are increased by a different percentage for
structural purposes:
E-3 <2: 7.3
E-4 <2: 12.0; E-4 >6 (through >26): 6.0
E-5 <2: 13.0
E-6 <2: 8.0
E-9 >26: 10.0; M/S: 10.0
W-1 <2: 15.0; W-1 >3: 14.0
W-2 >2: 6.0; W-2 >3: 11.0; W-2 >4: 11.0
Section 602 would amend section 407 of title 37, United
States Code, to authorize payment of a partial dislocation
allowance of $500 to members who are ordered, for the
convenience of the Government (including pursuant to the
privatization or renovation of housing), to move into or out
of military family housing. Section 601 would allow members
to receive a partial dislocation allowance for a government-
directed move at the current permanent duty station.
Currently, a member directed to move due to privatization
or renovation of government housing does so at the member's
personnel expense. In line with the current dislocation
allowance authority, the member is making an authorized move;
however, there is no authority to provide the member a
dislocation allowance to set-up the new home. Section 601
would provide a partial dislocation allowance to help members
defer moving expenses caused by the government's housing
decisions. Section 601 would limit payment in these
circumstances to $500 initially. Adjustments would be made
annually in a manner consistent with the full dislocation
allowance. Section 601 also would specify that payments made
under new subsection 407(c) shall not be subject to a fiscal
year limitation like other DLA payments.
Section 603 would provide the Service Secretaries with the
discretionary authority to pay the funeral honors duty
allowance to military retirees who volunteer to perform
honors at the funeral of a veteran. If authorized by the
Secretary concerned, the retiree would receive this allowance
without forfeiting any retired or retainer pay, disability
compensation, or any other compensation provided under titles
10, 37 and 38. This recognizes that military retirees are a
valuable personnel resource that can be employed to meet the
funeral honors mission. By using retirees to perform this
mission, it would allow active duty and reserve personnel to
continue to train for and perform other vital military
missions. It also recognizes that this minimal level of
compensation could be used to encourage retirees to volunteer
to perform this mission. Finally, by not requiring any offset
of their retired or retainer pay, or any other compensation,
Section 602 not only would reduce the administrative burden
placed on the Defense Finance and Accounting Service, but it
also would provide an incentive to retirees who, in the vast
majority of cases, would otherwise actually receive less
compensation than that provided by their retired or retainer
pay if they had to forfeit that pay in order to receive the
funeral honors duty allowance.
Section 604 would authorize Reserve Component commissioned
officers in the pay grade of O-1, O-2 or O-3 who are not on
active duty, but have accumulated a minimum of 1460 points
(the equivalent of four years of active duty) as a warrant
officer or enlisted member, to be paid at the O-1E, O-2E or
O-3E rate. Currently, a company grade officer with at least
four years of prior active duty service as a warrant officer
or as an enlisted member is entitled to be paid at a slightly
higher rate. The increase in pay recognizes the additional
experience these officers have gained while serving as a
warrant officer or an enlisted member and rewards them
accordingly. A Reserve commissioned officer who has
accumulated at least 1,460 points-the equivalent of four
years of active duty-has gained significant military
experience similar to that of a member who qualifies for this
increase in pay because of prior active duty service.
Moreover, because of the part-time nature of their service,
these officers have gained that experience over a longer
period of time and are generally more mature. Allowing these
officers to receive this increase in pay recognizes and
rewards that experience on the same basis as officers who
gained their experience purely through active duty service.
Section 605 would modify section 427 of title 37, United
States Code, to authorize the payment of a Family Separation
Allowance to those members who elect to serve an
unaccompanied--versus accompanied--tour because the member is
denied travel of the member's dependents due to certified
medical reasons. Currently, the law prescribes that a member
who elects to serve a tour of duty unaccompanied by his or
her dependents, at a permanent station to which the movement
of dependents is authorized, is not entitled to a Family
Separation Allowance. The law provides, however, that the
Secretary concerned may grant a waiver to that prohibition
when it would be inequitable to deny the allowance to the
member because of unusual family or operational
circumstances. Under existing waiver authority, the Services
approve waivers when a member chooses to serve an
unaccompanied tour because travel of the individual's
dependents to the new station is denied due to medical
reasons. This change would remove the statutory requirement
for the Secretary concerned to issue a waiver in these
circumstances before the Family Separation Allowance is
payable. This program efficiency would ease the
administration of the Family Separation Allowance program. In
addition, adoption of Section 604 would have no effect on
expenditures for the Family Separation Allowance program.
Section 606 would amend section 4337 of title 10, United
States Code, to authorize a housing allowance for the
chaplain for the Corps of Cadets at the United States
Military Academy. The chaplain, who is a civilian employee of
the Academy, would receive the same allowance for housing as
is allowed to a lieutenant colonel. The chaplain would also
receive fuel and light for quarters in kind.
Currently, section 4337 reads as follows: ``There shall be
a chaplain at the Academy, who must be a clergyman, appointed
by the President for a term of four years. The chaplain is
entitled to the same allowances for public quarters as are
allowed to a captain, and to fuel and light for quarters in
kind. The chaplain may be reappointed.'' Although section
4337, read literally, authorizes a quarters allowance for the
chaplain at the Academy with fuel and light in kind, the
Comptroller General has determined that this part of the
section has been effectively repealed.
The source statute for section 4337 was enacted in 1896 and
codified as part of title 10 on 10 August 1956. The
Comptroller General issued an opinion on August 28, 1959,
which held that Congress intended the Classification Act of
1949 to supersede the source statute for section 4337. The
purpose of the Classification Act was to ensure that Federal
employees in like positions received equal pay. The
Comptroller General concluded that the provisions relating to
a quarters allowance for the academy chaplain were closely
related to compensation and, therefore, the reenactment of
the quarters provision as part of title 10 in 1956 was
``erroneous. Ms. Comp Gen. B-140003. Consequently, the
military academy chaplain, although charged rent for
quarters, has not received a quarters allowance, despite the
plain language of section 4337.
This situation has, over time, undermined the Army's
ability to attract, hire and retain appointees for the
position of chaplain at the Academy, a position mandated by
section 4331(b)(5) of title 10. Enactment of Section 605
would ameliorate this problem by providing clear authority to
update and restore the academy chaplain's housing allowance,
at a reasonable and appropriate pay grade level.
The cost to implement Section 605 is estimated at $14,000
per year, although a portion of that expenditure would be
recouped as rent paid by the academy chaplain.
Section 607 would amend section 18505(a) of title 10,
United States Code, by removing the language relating to
space-required travel on military aircraft by Reserve
component members when the purpose of that travel is to
perform ``annual training duty.'' A statutory authority for
Reserve component members to travel in a space required
status when performing active duty for training (including
annual training duty) is not necessary since these members
are already authorized by DoD regulation to travel in a
space-required status. Of particular concern with the
addition of annual training duty to section 18505 is the
applicability of section 18505(b) to members performing
such duty. Section 18505(b) prohibits a member from
receiving travel, transportation and per them allowances
associated with space-required travel--allowances to which
the member was previously entitled before section 18505
was amended by section 384 of Public Law 106-398 (the
National Defense Authorization Act for Fiscal Year 2001)
to add ``annual training duty.''
Since annual training is a requirement for satisfactory
participation in the Selected
[[Page S7235]]
Reserve, the Services budget for those training tours--this
includes travel, transportation and per diem allowances.
While section 12305 of title 10 allows Reserve component
members to consent to perform active duty and active duty for
training without pay, it is not appropriate to use this
authority in conjunction with annual training. If this
authority is being used in conjunction with annual training
duty for Reserve component members who do not have an annual
training requirement, the Department can address this issue
through policy guidance.
If enacted, this proposal would have no cost or budgetary
effect.
Section 611 would amend section 301c of title 37, United
States Code, to remove submarine duty incentive pay (SUBPAY)
rates from law, enabling the Secretary of the Navy to adjust
SUBPAY rates when changes are needed to support submarine
accession and retention requirements. Section 611 also would
establish a maximum monthly SUBPAY rate of $1,000. The
effective date for these changes would be 1 October 2002.
Enlisted submarine Sailors receive SUBPAY while on shore
duty if they incur at least 14 months of obligated service
beyond their shore duty Projected Rotation Date, ensuring
they are assignable to future submarine sea duty. SUBPAY,
unlike Career Sea Pay or any other enlisted incentive or
special pay program, is a direct indicator of how well
submarines will be manned with experienced sea returnees as
much as three years into the future. Additionally, getting
experienced Sailors back to a submarine for 14 months
actually encourages experienced Sailors to stay past the 14-
month minimum requirement: of those Sailors with between 10
and 14 years of service, who are currently serving on board a
submarine and who went back to sea for at least 14 months, 79
percent obligated themselves for at least a two-year minimum
activity tour on that submarine.
In 1999, the decline in the propensity of enlisted
submarine personnel to incur additional obligated service
(and future sea duty service) equated to 776 lost man-years
of at-sea submarine service--enough manpower to operate 5
submarines for one year. Higher SUBPAY rates could be used to
stem this decline and entice undecided submarine Sailors at
the critical 10- to 12-year decision point to choose a 20-
year or greater Navy career. In addition, higher SUBPAY rates
could help Navy meet submarine non-nuclear enlisted
recruiting goals, which have not been met in the last decade.
The current statutory SUBPAY rate tables have been
duplicated in SECNAVINST 7220.80E, as well as in Tables 23-3
through 23-5 of Volume 7A, Chapter 23 of the Department of
Defense Financial Management Regulations. Thus, removing the
SUBPAY rates from law would provide the service secretary
with a timely, flexible and pay grade-targeted method to
address the looming personnel-related issues that are
probable given the uncertain future Submarine Force of
Record, which could add as many as 13 submarine crews by
FY2004 and 19 crews by FY2015.
SUBPAY was last increased in 1988, when it was raised to
restore the approximate value that it had for submarine
Sailors when the SUBPAY program was previously revised in
1981. Since 1988, the value of SUBPAY has eroded by
approximately 47 percent (based on the Consumer Price Index--
Urban Direct Index from 1988 to 1999 and projected to 2001).
If granted this new discretionary authority, Navy intends to
target first the most critically manned pay grades--mid grade
enlisted Sailors and junior to mid grade officers. This would
increase the maximum enlisted payment rate from $355 to $425,
but would maintain the maximum officer payment rate at $595.
Therefore, the budgetary impact of Section 611 would be a net
increase of $15.0 million in FY 2003 and a net increase of
approximately $14.5 million per year thereafter through FY
2007.
Section 612 would extend the authority to employ accession
and retention bonuses for enlisted personnel, and
continuation pay for aviators, ensuring that adequate
staffing is provided for hard-to-retain and critical skills,
including occupations that are arduous or that feature
extremely high training and replacement costs. Experience
shows that retention in those skills would be unacceptably
low without these incentives, which in turn would generate
the substantially greater costs associated with recruiting
and developing a replacement. The Department and the Congress
have long recognized the cost-effectiveness of financial
incentives in supporting effective staffing in critical
military skills.
Section 613 would extend the authority to employ accession
and retention incentives to support staffing for nurse and
dentist billets which have been chronically undersubscribed.
Experience shows that manning levels in the nursing and
dental fields would be unacceptably low without these
incentives, which in turn would generate substantially
greater costs associated with recruiting and developing a
replacement. The Department and Congress have long recognized
the cost-effectiveness of these incentives in supporting
effective personnel levels within these fields.
Section 614 would extend the authority to employ accession
and retention incentives, ensuring adequate manning is
provided for hard-to-retain skills, including occupations
that are arduous or feature extremely high training costs.
Experience shows retention in those skills would be
unacceptably low without these incentives, which in turn
would generate the substantially greater costs associated
with recruiting and developing a replacement. The Department
and the Congress have long recognized the cost-effectiveness
of these incentives in supporting effective manning in these
occupations. In the case of the Nuclear Officer Incentive Pay
Program, a two-year extension demonstrates support to
career-oriented officers.
Nuclear officer accessions and retention continue to fall
below that required to safely sustain the post-drawdown force
structure. Fiscal Year (FY) 1999 retention for submarine
officers was 30 percent (required 29 percent); for nuclear-
trained Surface Warfare Officers (SWO(N)s) it was 20 percent
(required 21 percent). FY 2000 retention for submarine
officers was 28 percent (required 34 percent); for SWO(N)s it
was 21 percent (required 21 percent). Although adequate for
now, nominal retention rates must improve by FY 2001 to 38
percent for submarine officers and 24 percent for SWO(N)s to
adequately meet growing manning requirements. Likewise,
current accession production must improve. Although nuclear
accession goals were met for FY 2000 (the first time meeting
submarine officer accessions since FY 1991), FY 2001 nuclear
officer accession goals have increased to meet the manning
requirements for an increased force size.
Inadequate accessions in previous years and continued poor
retention only compound the sacrifices incurred by those
officers remaining, as demanding and stressful sea tours are
lengthened to meet safety and readiness requirements. If the
shortfall of officers due to both effects is sufficiently
severe, the entire sea/shore rotation plan becomes
unbalanced, and officers eventually must rotate directly from
one sea tour to the next. This was the case in the 1960s and
1970s when many officers spent as many as 16 or more of their
first 20 years in sea duty and nuclear or warfare-related
training and supervisory assignments. Eventually, many of
these remaining officers find the sacrifices too great and
resign from the service. History has shown retention erodes
further, requiring even more accessions, and the ``vicious
cycle'' repeats. The success of the Naval Nuclear Propulsion
Program is a direct result of quality personnel, rigorous
selection and training, and high standards that exceed those
of any other nuclear program in the world. Maintaining this
unparalleled record of safe and successful operations depends
on attracting and retaining the right quantity and highest
quality of officers in the Naval Nuclear Propulsion Program.
Representing nearly half the Navy's major combatants and 60
percent of combat tonnage, nuclear-powered warships are
repeatedly called upon to protect our vital interests and
respond to crises around the world. They represent the
cornerstones of our continued maritime supremacy and are an
integral part of our national security posture. Adequate
manning with top quality individuals is key to the continued
safe operation of the program.
The attraction of the civilian job market for nuclear-
trained officers remains strong. These officers possess
special skills as a result of expensive and lengthy Navy
training. They also come predominantly from the very top of
their classes at some of the nation's best colleges and
universities. As a result, these officers are highly sought
for positions in career fields, both within and outside of
the nuclear power industry, due to their educational
background and management experience. The competition for
well-qualified, experienced technical personnel coupled with
the lowest unemployment rate in over two decades, indicate
that the marketability of nuclear-trained officers will
likely increase. Officers leaving the Navy after five years
of service can expect to transition to the civilian workforce
at about the same level of compensation, but with greatly
increased potential earnings and without the arduous
schedules and family separation.
The Nuclear Officer Incentive Pay program, in its current
structure, remains the surest and most cost-effective means
of meeting current and future manning requirements. Long-term
program support through a four-year program extension is
strongly encouraged. The two-year extension would demonstrate
Congressional commitment commensurate with that made by Naval
officers who have chosen to reap the rewards and endure the
sacrifices of a career in the Nuclear Propulsion Program.
Section 615 would extend the authorization for critical
recruiting and retention Reserve component incentive
programs. Recruiting has become increasingly more challenging
and the incentives provided by the Selected Reserve
affiliation and enlistment bonuses are a valuable part of the
overall recruiting effort. Absent these incentives, the
Reserve components may experience difficulty in meeting
skilled manning and strength requirements. Moreover, the
Reserve components rely heavily on being able to recruit
individuals with prior military service. The prior service
market is a high priority for the Reserve components since
assessing individuals with prior military experience reduces
training costs and retains a valuable, trained military asset
in the Total Force. The prior service enlistment bonus offers
an incentive to those individuals with prior military service
to transition to the Selected Reserve.
Equally important to the recruiting effort is retaining
members of the Selected Reserve. The Selected Reserve
reenlistment bonus, which was increased last year from
[[Page S7236]]
$5,000 to $8,000, is necessary to ensure the Reserve
components maintain the required manning levels by retaining
members who are already serving in the Selected Reserve.
Moreover, the special pay for enlisted members assigned to
certain high priority units provides the Services with an
incentive designed to reduce manning shortfalls in critical
undermanned units.
The Reserve components have historically found it
challenging to meet the required manning in the health care
professions. The incentive that targets those healthcare
professionals who possess a skill that has been identified as
critically short is essential if the Reserve components are
to meet required manning levels in these skill areas.
The expanded role of the Reserve components requires not
only a robust Selected Reserve force, but also a robust
manpower pools--the Individual Ready Reserve. Extending the
Individual Ready Reserve bonus authority would allow the
Reserve components to target this bonus at individuals who
possess skills that are under-subscribed, but are critical in
the event of mobilization.
Combined, the Reserve component bonuses and special pays
provide a robust array of incentives that are necessary if
the Reserve components are to meet manning requirements.
Extending these authorities would ensure continuity of these
programs. Since these incentive programs are recurring
Service budget items, there is no additional cost for
extending these authorities.
Section 616 would amend title 37, United States Code, by
establishing a broad authority for an Officer Critical Skill
Accession Bonus to provide needed flexibility for Service
Secretaries to recruit officers with critical skills. This is
intended to preclude the need to add future individual
statutory bonus provisions for specific officer career
categories experiencing an accession shortfall.
Over the past several years, officers with certain critical
skills have separated from service at higher than historical
rates, and recruitment of officers into these critical
specialties has declined. This is, in large measure, likely a
result of higher compensation and benefits being offered for
these skills in the private sector. Recruitment shortages
among officer skills can be expected to further erode absent
enactment of statutory authority for monetary incentives that
can be utilized to offset the pull on these critical
specialties from the civilian marketplace. Examples of
specialties currently short (and which have no, or
inadequate, statutory bonus authority for use to target the
shortages) include the Air Force's declining cumulative
continuation rates among officers in communications-
information systems (CIS) (35 percent in 1999), some
electrical engineers (39 percent in 1999 for developmental
engineers, and 31 percent for civil engineers in 1999),
scientific (53 percent in 1999), and acquisitions (averaged
38 percent from 1997-1999). Shortfalls in retention in these
skills are occurring while Air Force accession rates have
also continued to fall below the Air Force goal. As of June
30, 2000, the Air Force accessed 74 percent of its goal for
weather officers, 69 percent for developmental engineers, 83
percent for air traffic control and combat operations, and 90
percent for CIS. Authority for the Air Force to offer a
financial incentive to boost manning in the Engineering and
Scientific career and CIS specialties is particularly
critical.
Further, the Navy is experiencing shortages in their Civil
Engineer Corps (CEC) career field. The Navy has failed to
recruit the required number of CEC officers in the past three
fiscal years (1998 through 2000). In Fiscal Year 2000, the
Navy only accessed 54 percent of the CEC accession goal; it
projects to meet only 67 percent of the Fiscal Year 2001 CEC
accession goal, and projects to remain short in the out-
years. Shortages of that magnitude translate to
undersupervision in an unusually sensitive mission area.
Authority to offer CEC officer-recruits an accession bonus is
critical if the Navy is to have the compensation tools it
needs to increase the number of CEC officer-recruits to
levels needed to man future CEC force structure requirements.
An accession bonus authority would give Navy the competitive
edge it needs to attract the most qualified candidates to the
Navy CEC.
Rather than seeking additional individual statutory
authorities for these critical officer specialties, and any
others that may emerge in the future, this proposal seeks a
broad accession pay authority. Under such statutory
authority, the Departments would establish program parameters
and implementation strategies to ensure the Service
Secretaries are provided the flexibility they need to address
officer critical specialty shortfalls in a timely manner.
Based on current projections, the net effect of adoption of
Section 616 would be an increase of $18.05M in Fiscal Year
2002 ($.05M for Navy and $18M for Air Force), Army and Marine
Corps do not anticipate they would utilize this authority in
Fiscal Year 2002.
Section 617 would allow the Secretary concerned to target
this incentive to individuals who possess a skill that is
critically short to meet wartime requirements and who agree
to enlist, reenlist or voluntarily extend an enlistment in
the Individual Ready Reserve. The current statute authorizes
payment of this bonus to individuals who possess a skill that
is critically short in a combat or combat support mission.
However, this bonus is not authorized for individuals who
possess a critically short skill in a combat service support
mission. As a result of the drawdown and restructuring of the
force over the past decade, the Reserve components have
assumed a variety of new missions across the full range of
mission areas. Of particular concern is the ability to meet
the expanded combat service support mission requirements in
the Army Reserve. To meet manpower requirements in its
expanded combat support and combat service support role, the
Army Reserve must rely heavily on members of the Individual
Ready Reserve. Expanding this authority to allow the
Secretary concerned to target this bonus in those skill areas
that are critically short, regardless of the type of mission,
would help reduce critical mobilization manning shortages.
This proposed change is consistent with other active duty and
Selected Reserve bonus authorities, which provide the Service
Secretary with the authority to identify those skill areas
that are critically short and require added incentives to
achieve the necessary manning level to meet mission
requirements.
Section 618 would amend section 301 of title 37, United
States Code, to authorize payment of hazardous duty incentive
pay for members of Visit Board Search and Seizure teams
conducting operations in support of maritime interdiction
operations.
Boarding crews participating in these operations face
several hazards inherent to the duty involved. These include
the hazards of physically boarding a vessel at sea from a
small boat while carrying weapons, inspection gear, and
protective clothing. Further hazards exist in the actual
conduct of the inspections, such as hazards connected with
crew hostilities, pest infestations, and numerous unseen
dangers. For example, containers must be accessed, which
often requires climbing considerable distances above the
deck, balancing in precarious positions while opening the
container, and facing the risk the container contents may
have shifted during the transit. In addition, cargo may have
mixed, causing a hazard (for example, bulk cargo such as
fertilizer, when mixed with salt water or oil, can emit
hazardous fumes). Hazardous Duty Incentive Pay would provide
a financial recognition to personnel participating in these
operations for this unusually hazardous duty.
The net effect of adoption would be an increase of $0.2
million for the Navy.
Section 621 would amend section 430 of title 37, United
States Code, to extend the entitlement to funded student
dependent travel to members stationed outside the continental
United States with dependents under the age of 23 who are
enrolled in a school in the continental United States but are
attending a school outside the United States as part of a
school-sponsored exchange program. At present, members
stationed overseas are entitled to funding for this
program, but only if the student is physically located in
the United States. This creates an inequity for those
members whose dependents attend a school in the United
States, but are part of a temporary exchange program
located outside the United States. Both sets of members
deserve equal treatment.
Section 621 would reimburse travel expenses for student
dependents under the age of 23 of a member stationed outside
the continental United States when the dependents are
enrolled in a school in the continental United States but are
attending a school outside the United States as part of a
school sponsored-exchange program for less than a year.
Section 621 would further limit reimbursement in these cases
to the cost of travel between the school in the continental
United States where the student dependent is enrolled and the
member's overseas duty station.
Section 622 would amend section 2634 of title 10, United
States Code, by adding a new subsection 2634(b)(4)
authorizing payment of vehicle storage costs in advance.
Section 2634 authorizes the Secretary concerned to store a
member's vehicle at government expense under certain
circumstances, but does not provide for advance payment of
these costs. Vehicle storage costs at a commercial facility
can range from $100 to $300 per month, and many of these
facilities require deposits equal to two or three times the
monthly storage rate. The Military Traffic Management Command
estimates there are approximately 20,000 vehicles that are
stored in commercial facilities annually.
Having to pay for these advance payments out of pocket
comes at the worst possible time for the military member--
during a permanent change of station move. The variety of
expenses associated with a move put a significant strain on
the financial condition of members, often requiring them to
acquire significant debt while they wait for government
reimbursement to catch up. At no additional cost to the
Government, Section 622 would eliminate one portion of this
burden, reducing to some degree the hardship associated with
a military life that requires frequent moves.
Section 623 would amend section 411f of title 37, United
States Code; strike subsection (d) of section 1482 of title
10, United States Code; and repeal the Funeral Transportation
and Living Expense Benefits Act of 1974 (Public Law 93-257).
Currently, the three statutes cited above authorize
allowances for family members and others to attend burial
ceremonies of deceased members of the armed forces. The
statutes differ in scope and application. For example,
section 1482(d) prohibits the payment of per diem, while per
diem may be
[[Page S7237]]
paid under the other two sections. The purpose of Section 622
is to establish uniform authority.
Section 411f of title 37 authorizes round trip travel and
transportation allowances for ``dependents of a member who
dies while on active duty or inactive duty in order that such
dependents may attend the burial ceremonies of the deceased
member.'' Allowances under the section, including per diem,
are limited to travel and transportation to a location in the
United States, Puerto Rico, or United States possessions and
``may not exceed the rates for two days.'' If a deceased
member was ordered to active duty from a place outside the
United States, allowances may be provided for travel and
transportation to and from such place and may be extended to
account for the time necessary for such travel. Dependents
include the surviving spouse, unmarried children under 21
years of age, unmarried children incapable of self-support,
and unmarried children enrolled in school and under 23 years
of age. Section 411f(c) provides that if no person qualifies
as a surviving spouse or unmarried child, the parents of a
member may be paid the travel and transportation allowances
authorized under the section.
Section 1482(d) of title 10 applies when, as a result of a
disaster involving multiple deaths of members of the armed
forces, the Secretary of the military department has
possession of commingled remains that cannot be individually
identified and must be buried in a common grave in a national
cemetery. Under section 1482(d), the Secretary may pay the
expenses of round trip transportation to the cemetery for a
person who would have been authorized under section 1482(c)
to direct the disposition of the remains of the member if
individual identification had been made. Also, the Secretary
may pay the expenses of transportation for two additional
persons closely related to the decedent who are selected by
the person who would have been designated under section
1482(c). No per diem may be paid.
The Funeral Transportation and Living Expense Benefits Act
of 1974 applies only to families of deceased members of the
armed forces who died while classified as a prisoner of war
or as missing in action during the Vietnam conflict and whose
remains are returned to the United States after January 27,
1973. Family members may be provided ``funeral transportation
and living expenses benefits.'' Benefits include round trip
transportation from the family member's residence to the
place of burial, ``living expenses, and other such allowances
as the Secretary shall deem appropriate.'' Eligible family
members include ``the deceased's widow, children,
stepchildren, mother, father, stepfather and stepmother.'' If
none of the family members in the preceding sentence ``desire
to be granted such benefits,'' then the benefits may be
granted to the deceased's brothers, sisters, half-brother,
and half sisters.
For members of the armed forces during World War II and the
Korean War whose remains have recently been recovered and
identified, there may be no family members who can be
provided travel and transportation allowances to attend the
burial. As noted above, under section 411f, dependents who
may receive travel and transportation allowances include a
surviving spouse, certain ummarried children, primarily those
under 21 years of age, and parents if there is no surviving
spouse or qualifying child. However, in these cases, the
surviving spouse and parents may be deceased and no child may
qualify because of their age. Section 623 would amend section
411f and add a new provision similar to the provision in
section 1482(d) of title 10, concerning the burial of remains
that are commingled and cannot be identified. Under Section
623, if there is no surviving spouse, no qualified child, and
no parent, then the person designated to direct disposition
of the remains could receive travel and transportation
allowances along with two additional persons closely related
to the deceased member selected by the person who directs
disposition of the remains. In many cases, this would
likely include an adult child or children of the deceased
member.
Section 623 would also amend section 411f to authorize the
payment of travel and transportation allowances for a person
to accompany a family member who qualifies for travel and
transportation allowances but who is unable to travel alone
to the burial ceremonies because of age, physical condition,
or other justifiable reason as determined under uniform
regulations prescribed by the Secretaries concerned.
Allowances would be payable under these circumstances only if
there is no other person qualified for allowances available
to assist the family member.
Section 623 would also amend section 411f to provide a new
basis for authorizing travel and transportation allowances
outside the United States, Puerto Rico, and United States
possessions. Currently, the only exception is when the member
was ordered to active duty from a place other than in the
United States, Puerto Rico, or the United States possessions.
Section 623 would amend section 411f(b) to authorize the
payment of travel and transportation allowances to a cemetery
maintained by the American Battle Monuments Commission
outside the United States.
Section 623 would amend section 411f(b) to make uniform the
rule concerning the time period for which allowances may be
paid. Currently, section 411f(b) restricts the period to two
days for travel within the United States, Puerto Rico, and
United States possessions. For travel outside these areas,
the two-day period may be extended ``to accommodate the time
necessary for such travel.'' Under Section 623, all travel
and transportation allowances, regardless of where the travel
occurs, would be limited to two days and the time necessary
for travel.
Section 623 would also strike subsection (d) from section
1482 of title 10, relating to the burial of commingled
remains in a common grave. Section 411f would be amended by
adding a new subsection (d) to define burial ceremonies as
including ``a burial of commingled remains that cannot be
individually identified in a common grave in a national
cemetery.'' Thus, the authority in section 411f would provide
the basis for travel and transportation allowances under
these circumstances. Unlike section 1482(d), this authority
would include the payment of per diem.
Finally, Section 623 would repeal the Funeral
Transportation and Living Expense Benefits Act of 1974. The
Act, enacted in 1974, authorizes travel and transportation
allowances for the family of any deceased member of the armed
forces who died while classified as a prisoner of war or
missing in action during the Vietnam conflict. Section 411f
was enacted in 1985. Both statutes provide similar authority.
The Act's authority is somewhat broader because eligible
family members include the surviving spouse, all children
(regardless of age), parents, and siblings. The Act would be
repealed to provide uniform treatment among all family
members of persons who die while on active duty or inactive
duty.
Section 624 would modify section 2634 of title 10, United
States Code, to authorize service members to ship a
privately-owned vehicle (POV) from the old Continental United
States (CONUS) duty station to the new CONUS duty station
when the cost of shipment and commercial transportation would
not exceed the cost of driving the POV to the new station as
is currently authorized.
Currently, when executing a permanent change of station
move in CONUS, service members are allowed to ship POVs
between CONUS duty stations only when physically incapable of
driving, there is a change of a ship's homeport, or there is
insufficient time to drive. Members with dependents who
possess two POVs would be authorized to ship one POV and
drive the other if the cost of driving one POV and shipping
the other did not exceed the cost driving two POVs. Cost
comparisons would take into account mileage rates by the most
direct regularly traveled route, per diem, cost of commercial
transportation and the cost of shipping the car by commercial
car carrier. Section 624 would be cost-neutral, and enhance
force protection by minimizing the number of miles driven by
members making permanent changes of station, thereby limiting
exposure to accidents. Civilian employees of DoD are
currently authorized to ship POVs in CONUS when it is
determined to be more advantageous and cost-effective to the
Government.
Section 631 would extend the maximum period that a member
of the Selected Reserve would be authorized to use the
educational benefits provided under the Montgomery GI Bill
for the Selected Reserve (MGIB-SR) from the current 10-year
limit to 14 years. With the increased use of the Reserve
components, members of the Selected Reserve are spending more
time performing military duties. The additional time spent
performing military service reduces the amount of time they
have available for other activities--be it a civilian job,
time with the family, other leisure activities, or civilian
education. Balancing a full-time civilian career and a
military career is becoming increasingly more challenging.
One area that is likely to suffer is the pursuit of civilian
education. Increasing the number of years that a member of
the Selected Reserve has to use this benefit would recognize
their increased commitment to military service and provide
them with an extended opportunity to use this benefit.
Additionally, since membership in the Selected Reserve is
required in order to use the MGIB-SR educational benefit, it
would also serve as a retention incentive for those who have
not been able to use the benefit by the current 10-year
limiting period.
Section 632 would add overnight health care coverage when
authorized by regulations for Reserve Component members who,
although they may reside within a reasonable commuting
distance of their inactive duty training site, are required
to remain overnight between successive drills at that
training site because of mission requirements. Some Reserve
Component members are required to remain overnight in the
field when performing inactive duty training. Others may be
training late into the evening or performing duty early in
the morning, which could make commuting to and from their
residence impractical. On those occasions when it is not
feasible for members who live in the area to return to their
residence between successive drills because of mission
requirements, they are currently not protected should they
become injured or ill during that overnight stay. The
Secretary of Defense report to Congress on the means of
improving medical and dental care for Reserve Component
members, which was sent to Congress on November 5, 1999,
recognized this shortcoming and recommended that the law
be amended to provide medical coverage when the member
remains overnight between successive training periods,
even if they reside within reasonable commuting distance.
[[Page S7238]]
Section 633. Section 2004 of title 10, United States Code,
authorizes the Secretary of a Military Department to detail
selected commissioned officers at accredited law schools for
training leading to the degree of bachelor of laws or juris
doctor. No more than 25 officers from each Military
Department may commence such training in any single year.
Officers detailed for legal training must agree to serve on
active duty following completion of the training for a period
of two years for each year of legal training. This service
obligation is in addition to any service obligation incurred
by the officer under any other provision of law or agreement.
Section 2603 of title 10 authorizes any member of the Armed
Forces to accept a scholarship in recognition of outstanding
performance in the member's field, to undertake a project
that may be of value to the United States, or for development
of the member's recognized potential for future career
service. Section 2603(b) requires a member of the Armed
Forces who accepts a scholarship under section 2603 to serve
on active duty for a period at least three times the length
of the period of the education or training.
Section 2004 does not specifically authorize an officer
attending law school under the Funded Legal Education Program
to accept a scholarship from the law school or other entity.
Also, section 2603 does not indicate that the authority to
accept a scholarship to obtain education or training under
the section can be used in conjunction with the authority in
another section authorizing education or training, such as
section 2004. Moreover, if the authority in section 2004 for
a funded legal education can be used in conjunction with the
authority in section 2603 to obtain training or education
through a scholarship, the resulting service obligation for
an officer participating in the Funded Legal Education
Program who accepts a scholarship is unclear. The statutes
could be interpreted to require consecutive service
obligations in excess of twelve years or concurrent service
obligations of much less.
An officer who accepts a scholarship would reduce the
expenditure of appropriated funds of the military department
concerned. Obtaining a scholarship may also benefit an
officer participating in the funded legal education program.
For example, in the Army, to minimize the costs associated
with the funded legal education program, an officer must
attend a law school in the officer's state of legal residency
that will permit the Army to pay in-state tuition rates or a
law school that will grant in-state tuition rates to out-of-
state students. This effectively prohibits officers from
seeking admission into many of the most highly rated law
schools in the United States. If an officer could accept a
scholarship to cover all or part of the costs of attending
law school, it may be unnecessary to require the officer to
attend a school at which the officer qualifies for in-state
tuition rates.
Section 633 would amend sections 2004 and 2603 to authorize
an officer detailed to law school for legal training under
section 2004 to accept a scholarship from the school or other
entity under section 2603, with the service obligations
incurred under both sections to be served consecutively.
Section 701. As a result of studies done in response to
direction in Section 912 of the National Defense
Authorization Act for Fiscal Year 1998 (Pub. L. 105-85),
Defense Science Board reports, and General Accounting Office
reports, as well as a desire to implement best commercial
practices, the Department rewrote its acquisition policy
documents. The purpose of the rewrite was to focus on
providing proven technology to the warfighter faster,
reducing total ownership cost, and emphasizing affordability,
supportability, and interoperability. As part of the rewrite,
the Department created a new model of the acquisition process
that separates technology development from system
integration, allows multiple entry points into the
acquisition process, and requires demonstration of utility,
supportability, and interoperability prior to making a
commitment to production. As part of the model, milestone
names were changed to Milestone A (approval to begin analysis
of alternatives), Milestone B (approval to begin integrated
system development and demonstration), and Milestone C
(approval to begin low-rate production). The phases of
acquisition were changed to Concept and Technology
Development (in which alternative concepts are considered and
technology development is completed), System Development and
Demonstration (in which components are integrated into a
system and the system is demonstrated), and Production and
Deployment (in which the system is produced at a low-rate to
allow for initial operational test and evaluation, creation
of a production base, efficient ramp-up of production to
full-rate, and deployment). Within the Production and
Deployment phase is the Full-Rate Production Decision Review
at which the results of operational test and evaluation and
live-fire test are considered.
The purpose of this proposed legislation is to make changes
in current statutes, which was based on the old milestone 0/
I/II/III model, so that they correspond to similar events
based on the new milestone A/B/C model. There is no intent to
diminish congressional oversight or to change the content or
amount of reporting requirements to the Congress, although
the timing of some reports will change.
Under the new milestone A/B/C model, program initiation
begins later than under the old milestone 0/I/II/III model.
The reason for this is that the new model anticipates more
extensive technology development before committing to a new
program using those technologies, while the old model
completed technology development after program initiation.
Approval to begin analysis of alternatives that previously
occurred at Milestone 0 (that now corresponds to Milestone A)
will continue to be done in Concept and Technology
Development. Work that was previously done in Demonstration
and Validation (or Program Development and Risk Reduction) is
split around Milestone B with the technology development work
being done in Concept and Technology Development (before
Milestone B) and the system prototyping and engineering and
manufacturing development being done in System Development
and Demonstration (after Milestone B).
Requirements identified in law for Milestone I or prior to
Demonstration and Validation phase, intended to apply to an
initiated program, are changed to be required at Milestone B
or prior to System Development and Demonstration. Likewise,
requirements identified in law for Milestone II or prior to
Engineering and Manufacturing Development, intended to apply
to system engineering work, are changed to be required at
Milestone B or prior to System Development and Demonstration,
both of which encompass this work effort. All requirements
identified in the law for Milestone III or prior to
production would be required at the full rate production
decision.
Sections 2366, 2400, 2432 and 2434, are essentially
unchanged in reporting requirements.
Section 2435 of Title 10 requires an acquisition program
baseline be developed prior to entering work following each
of the milestone I, II, and III decisions. In the case of the
acquisition program baseline, a new baseline description will
be generated at program initiation, and at each major
transition point (from system development and demonstration
to low-rate production, and from low-rate production to full-
rate production). The first and second program baselines will
be completed later than baselines generated under current
statute. The first baseline will continue to describe the
system concept at program initiation and will also serve to
describe the program through engineering development. The
second baseline will describe the system as engineered prior
to beginning production. There will be no change in the
description for the third baseline.
Section 8102(b) of Public Law 106-259 and Section 811 (c)
of Public Law 106-398 require Information Technology
certification at each major decision point (i.e., milestone).
These requirements have been translated from the milestones
I/II/III of the old model to milestones A/B/C of the new
model.
Section 702 conforms the nuclear aircraft carrier exclusion
from the statute to actual practice by specifying that the
exclusion from maintaining core logistics capabilities, with
respect to nuclear aircraft carriers under section 2464 of
title 10, United States Code, applies only to the nuclear
refueling of an aircraft carrier. The term ``core logistics
capabilities'' is used to define those maintenance and repair
standards which should be continually met by the Armed Forces
so that it will be able to maintain and repair, on its own, a
variety of military equipment. These requirements are adhered
to as an assurance that, in times of emergency, the military
can meet mobilization, training and operation requirements
without requiring outside (contractor) intervention or
hindrance.
While the current law reads to exclude a nuclear aircraft
carrier, in its entirety (including all maintenance
processes), from a requirement to maintain a core logistics
capability, this revision intends to apply this exclusion
solely to the process of refueling. Nuclear aircraft carrier
work, other than nuclear refueling, is currently--and will
continue to be--a core logistics capability that is
maintained in accordance with the provisions of 10 U.S.C.
Sec. 2464. Furthermore, every other type of naval surface
combatant currently utilized is required to maintain core
logistics capabilities. To completely exclude these carriers
from the requirement to maintain these capabilities would be
to set the carrier apart from other naval surface combatants,
which was not the intention of the Navy in formulating its
original legislation.
Therefore, this amendment is meant to both clarify the
original intent of the drafters for 10 U.S.C. Sec. 2464 and
to discourage situations which could result in future
problems, such as the privatization of unique carrier items
which were not meant to be excluded from the requirement for
maintaining core logistics capabilities.
Section 703. The Department is committed to fully utilizing
its organic depots in order to maintain a core logistics
capability. There are circumstances, however, when a depot is
utilized to its maximum capability and, because of the
limitations imposed by 10 U.S.C. Sec. 2466, the Department is
prohibited from contracting out the work. The work must still
be performed by in-house depots, resulting in delays and
excess costs. This provision would expand the waiver
authority, permitting the Secretaries to waive the limitation
once a depot has achieved full utilization. This will result
in savings to the customers and in more timely accomplishment
of the work. In situations where multiple depots can perform
the same type of maintenance activity, it may not be
economical to transfer the work from a fully-utilized depot
to one that is operating at less than maximum capacity but in
a different
[[Page S7239]]
geographic region. The Secretary may waive the limitations if
he makes a determination that it would be uneconomical, due
to reasons such as cost or logistical constraints, to
transfer such workload.
Section 705 would clarify the intent of amendments to
section 1724 of title 10, United States Code, that were made
by Section 808 of the Floyd D. Spence National Defense
Authorization Act for Fiscal Year 2001 (Public Law 106-398;
114 Stat. 1654A-208). It would also establish a Contingency
Contracting Force, and authorizes the Secretary of Defense to
establish one or more developmental programs for contracting
officers, employees and applicants for the GS-1102 series,
and recruits and military personnel in similar occupational
specialties.
Section 808 established strict minimum qualification
requirements for contracting officers and civilian employees
in GS-1102 positions. It also made these requirements
applicable to military members in similar occupational
specialties. Section 808 also amended the exception provision
in section 1724 of title 10, United States Code, to except
from the new requirements persons ``for the purpose of
qualifying to serve in a position in which the person is
serving on September 30, 2000.'' The legislative history
accompanying this change stated that the new requirements
were intended to apply only to new entrants into the GS-1102
occupational series in the Department of Defense and to
contracting officers with authority above the simplified
acquisition threshold, but not to current employees. This
proposal would make clear this intent by excluding from the
new requirements military and civilian personnel who were
serving, or had served, as contracting officers, employees in
the GS-1102 series, or military personnel in similar
occupational specialties on or before September 30, 2000.
This proposal would also reinstate the qualifications
requirements that were previously contained in section 1724
for current employees that are excluded from the new
qualifications requirements.
This proposal would also provide the Secretary with
flexibility to establish one or more developmental programs,
which would educate people to meet the statutory minimum
qualification requirements of a degree and 24 credit hours in
business. Their purpose would be to enable personnel to
obtain the education necessary to meet the performance
requirements of the future acquisition workforce. A
significant number of the Department's current, seasoned
acquisition workforce personnel will be eligible to retire
within five years. This makes it imperative that the
Department have access to the maximum number of superior
applicants. We anticipate that the Office of the Secretary of
Defense would establish one or more programs in which
candidates that meet some, but not all, of the minimum
requirements could be educated to meet the remaining
requirements within a specified period of time. For example,
a candidate may have a four-year degree, but not the twenty-
four credit hours in business-related courses. Another
candidate may be close to a degree, including 24 credit hours
in business. Each would be provided a specified period of
time (in no case more than three years) to meet all of the
statutory requirements. We would anticipate that any person
who failed to meet all of the statutory requirements within
the time specified would be subject to separation from
federal service. This flexibility will give the Department
the necessary mechanisms for accessing the greatest number of
superior applicants, while retaining its goal of maintaining
a high-quality, professional contracting workforce.
This proposal would also addresses the need to recognize a
contracting force whose mission is to deploy in support of
contingency operations and other Department of Defense
operations. This force, which consists primarily of enlisted
personnel, but which includes both military officers and
civilian employees, meets a unique need within the Department
and has unique training and qualification requirements.
This proposal would maintain the requirement for 24
semesters hours of business-related course work or the
equivalent and give the Secretary flexibility to establish
other minimum requirements to meet the unique needs of
persons performing contracting in support of contingency and
other Department operations.
Section 706. The current language in section 1734(a) of
title 10, United States Code, applies to the tenure
requirement of over 13,500 critical acquisition positions
(caps). This proposal would retain the qualifications to
occupy a CAP. The proposed change would require tenure only
for personnel in those critical acquisition positions where
continuity is especially important to the success of DoD's
acquisition programs. Ensuring the tenure of these
individuals assigned to program offices and the associated
system acquisition functions like systems engineering,
logistics, contracting, etc., therein provides the stability
originally sought by section 1734. This change would allow
more flexibility to meet organizational mission priorities;
enhance career development programs for those holding the
remaining critical acquisition positions who perform either
functions outside of a program office or functions not
related to systems acquisitions (such as procuring spare
parts or policy formulation); and would ensure DoD develops
the best-qualified individuals for CAPS in program offices
and systems acquisition functions.
The current section 1734 undertakes to improve the quality
and professionalism of the DoD acquisition workforce in part
through a career development program for acquisition
professionals. This proposal would retain that intent, while
emphasizing the importance of specific job experience and
program continuity, responsibility, and accountability for
acquisition personnel working in program offices or
supporting system acquisition programs who are performing
critical acquisition functions. This proposal also would
expand career-broadening opportunities for personnel in other
CAPS and would result in a reduction of waiver reporting
requirements. The proposal balances the needs for program
continuity, responsibility, accountability, and career
development, while eliminating an unnecessary administrative
burden, increasing productivity, and allowing the workforce
to be responsive to changing organizational needs.
Section 710 would amend section 2855 of title 10, United
States Code, to repeal a provision of law that prevents the
Department of Defense (DOD) from achieving its goal of 40
percent of the dollar value of architectural & engineering
(A&E) service contracts awarded to small businesses. This
goal was established by section 712(a) the Small Business
Competitiveness Demonstration Program Act of 1988 (15 U.S.C.
644 Note).
The Small Business Competitiveness Demonstration Program
was established to see if small business concerns could
maintain a reasonable percentage of dollars awarded in four
Designated Industry Groups (digs) in an unrestricted
competitive environment. A&E services is one of the DIGS. The
Program establishes a small business participation goal of 40
percent of the dollars awarded in each of the aforementioned
DIGS. The statute further states that if small business
concerns fail to achieve the 40 percent goal during a twelve
month period, the agency shall re-establish set-aside
procedures to the extent necessary to achieve the 40 percent
goal (Section 712(a) of Pub. L. 100-656).
Notwithstanding the authority of the Demonstration Program,
section 2855(b) generally prohibits DOD from using small
business set-aside procedures in the awarding of A&E service
contracts when the estimated award price is greater than
$85,000. Section 2855(b)(2) provides for revision of the
$85,000 threshold if the Secretary of Defense determines that
it is necessary to ensure that small business concerns
receive a reasonable share of A&E contracts. DOD estimates
that they would need to increase the threshold to over $1
million to accomplish this end. This would be so
disproportionate to the $85,000 statutory threshold that it
is more appropriate to seek a legislative change.
Further, DOD would need to continually readjust the
threshold over time to reflect changes in small business
participation. For example, in fiscal year 1999, DOD achieved
a small business A&E participation rate of 16.4 percent,
significantly below the 40 percent goal established by the
Demonstration Program. Historically, approximately 30 percent
of A&E awards were made to small businesses. Continual
adjustments to the threshold to reflect such changes in small
business participation would be impractical and confusing to
both contracting officials and small businesses.
Repealing section 2855(b) will eliminate the $85,000
threshold. As a result, A&E contracts for military
construction and military family housing projects could be
set aside exclusively for small businesses to achieve the
small business competitiveness demonstration A&E goal
mandated by 15 U.S.C. 644. Accordingly, this proposal would
eliminate conflicting statutory provisions that currently are
making it unnecessarily difficult for DOD to achieve the
small business goal for A&E contracts.
Section 711. Section 2534 of title 10, United States Code
provides that ball and roller bearings must be acquired from
domestic sources even when such a restriction is not in the
Government's interest. This amendment would provide an
exception to this restriction if a determination is made that
the purchase amount is $25,000 or less; the precision level
of the ball or roller bearings is lower than Annual Bearing
Engineering Committee (ABC) 5 or Roller Bearing Engineering
Committee (RBC) 5, or their equivalent; at least two
manufacturers in the national technology and industrial base
capable of producing the required ball or roller bearings
decline to respond to a request for quotation for the
required items and the bearings are neither miniature or
instrument ball bearings as defined in section 252.225.7016
of title 48 of the Code of Federal Regulations. This
exception was developed in conjunction with the Department of
Commerce, the agency with primary oversight for this area.
If enacted, this amendment would significantly reduce the
burdensome administrative process Department of Defense
purchasers must follow for small procurement that do not
impact the industrial base. It would also provide needed
flexibility for readiness concerns. The large procurement
that will have an impact on the industrial base remain
reserved for domestic suppliers.
Section 712 relates to congressional interest in the Air
Force Contractor Operated Civil Engineering Supply Store
(CACAOS) program. This proposal would remove constraints on
the Air Force's ability to combine CACAOS with A-76 cost
comparisons.
[[Page S7240]]
FY 98 & 97 Defense Authorization Acts, (Committee Reports 105
H Rpt. 132, 104 H. Rpt. 563)
In the Committee Report to the 1998 Defense Authorization
Act, the House Committee on National Security specifically
directed the Secretary of the Air Force not to combine CACAOS
functions with other service functions when considering
multi-function service contracts until a thorough analysis is
conducted. Such analysis would include an economic analysis
that would assess the merits of combining these services to
increase efficiencies at Air Force installations. The
committee also directed the Secretary of the Air Force not to
change the current operation of any CACAOS, or to permit any
combinations of supply and services functions in upcoming
procurement, that would violate or circumvent the tenets of
any current CACAOS contractual agreement. The Committee had
similar language in its report on the 1997 Defense
Authorization Act (and also directed the Secretary of the
Army and the Secretary of the Navy to consider the
application of the CACAOS program as a means to further
reduce the cost of essentially non-governmental functions).
FY 99 Defense Authorization Act
Congressional concerns over CACAOS made its way into
section 345 of Public Law 10526 1, which, in addition to
extolling the virtues of CACAOS, established two requirements
if the Air Force wishes to combine a CACAOS with an A-76
study. First, the Secretary of Defense has to notify Congress
of the proposed combined competition or contract, the agency
has to explain why a combined competition or contract is the
best method by which to achieve cost savings and efficiencies
to the Government. The Act also established a mandatory GAO
Review of the Secretary of Defense's explanation of the
projected cost savings and efficiencies. The Comptroller
General reviews the report and submits to Congress a briefing
regarding whether the cost savings and efficiencies
identified in the report are achievable.
The CACAOS law was based upon the assumption that the
government would be running an inefficient supply operation
for materials to be used in Government operations. The
environment today is entirely different. Due to A-76
emphasis, Civil Engineering (CE) is being competitively
source; hardware super stores and the International Merchant
Purchase Authorization Card (IMPACT) make it unnecessary to
maintain supply inventories; and greater competition is
obtained when the supply function is included in the CE
effort. CACAOS was designed to replace inefficient government
management of commercial supply inventories. As we contract
out CE and other base support functions, the users of these
supplies will be contractors instead of government
organizations. The Department will end up creating situations
where the CE contractor, or the Most Efficient Organization
(MFO), will be required to obtain supplies from the CACAOS
contractor in order to do their work. These common commercial
items would become Government Furnished Property (HFP) under
the contract and the CE contractor cannot be held fully
responsible for all aspects of project completion. If CACAOS
fails to provide suitable materials on schedule, the CE
contractor could be entitled to an equitable adjustment for
late or defective HFP.
As a general rule, the Department should only provide HFP
when the government owns or has available unique or
specialized materials that the contractor would not be able
to obtain. CACAOS materials are common commercial items
readily available through multiple sources. The requirement
to provide these materials should be made a part of the CE
contract to keep the government out of the middle of two
separate contracts and avert the transfer of performance risk
to the government. Also, with the advent of today's hardware
super stores (Home Depot, HQ, etc.) with their large
inventories and low prices, it doesn't make sense to
establish a CACAOS-style operation. With the speed and
convenience of the IMPACT, even the MFO would not choose to
establish a large supply infrastructure for the common
commercial items.
Section 345(b)(6) states that ``Ninety-five percent of the
cost savings realized through the use of contractor-operated
civil engineering supply stores is due to savings in the
actual cost of procuring supplies.'' This statement is no
longer accurate and seems to apply to Form 9 processing
costs, not IMPACT card costs.
Section 713. The National Defense Authorization Act for
Fiscal Year 1996, included the Federal Acquisition Reform Act
of 1996 (FAR) and the Information Technology Management
Reform Act of 1996 (ITMRA). FARA and ITMRA were subsequently
renamed the Clinger-Cohen Act of 1996. This proposal would
modify section 4202 of the Clinger-Cohen Act to extend the
test program for certain commercial items.
Section 2304(g) of title 10, United States Code, and
sections 253(g) and 427 of title 41, United States Code,
permit the use of special simplified procedures for purchases
of property and services for amounts not greater than the
simplified acquisition threshold (SAT). Section 4202 of the
Clinger-Cohen Act, Application of Simplified Procedures to
Certain Commercial Items, extended the authority to use
special simplified procedures to purchases for amounts
greater than the SAT but not greater than $5 million if the
contracting officer reasonably expects, based on the nature
of the supplies or services, and on market research, that
offers will include only commercial items. The purpose of
this test program is to vest contracting officers with
additional procedural discretion and flexibility, so that
commercial item acquisitions in this dollar range may be
solicited, offered, evaluated, and awarded in a simplified
manner that maximizes efficiency and economy and minimizes
burden and administration costs for both Government and
industry.
The test program was enacted into law on February 10, 1996.
Final changes to the Federal Acquisition Regulation (FAR) to
implement the test program were issued on the statutory
deadline of January 1, 1997. The due date for the Comptroller
General report does not provide sufficient time to process a
legislative proposal that would prevent the test program from
expiring once the Comptroller General has submitted the
report. This proposal would extend the test program authority
to January 1, 2003, to provide sufficient time to assess this
potentially valuable acquisition reform authority based on
the GAO's findings and, if warranted, seek to make this
authority permanent.
Section 714 eliminates the prohibition on using funds to
retire or dismantle Peacekeeper intercontinental ballistic
missiles below certain levels. This provision is in specific
support of the amended budget and will result in considerable
savings.
Section 715. The proposed change would provide the Services
the flexibility to proceed with construction contracts
without disruption or delay by excluding the cost associated
with unforeseen environmental hazard remediation from the
limitation on cost increases. Unforeseen environmental hazard
remediation refers to asbestos removal, radon abatement,
lead-based paint removal or abatement, and any other
legislated environmental hazard remediation that could not be
reasonably anticipated at the time of budget submission.
Currently, section 2853 of title 10, United States Code
only excludes the settlement of a contractor claim from the
limitation on cost increases. The Senate Appropriations
Committee Report (106-290) which accompanied the Military
Construction Appropriation Bill for Fiscal Year 2001 (S.
2521) allows the Services to exclude unforeseen environmental
remediation costs from the application of reprogramming
criteria for military construction and family housing
construction projects. However, this report language presents
a conflict with the unqualified language of the statute. A
reprogramming action is required when the cost increase for a
military construction or military family housing project will
exceed 25 percent of the amount appropriated for the project
or 200 percent of the minor construction project ceiling
specified in Section 2805 (a)(1), Title 10, United States
Code, whichever is less. A reprogramming action refers to the
requirement to provide an advance congressional report and
seek congressional approval before proceeding with the work.
Section 716. The revised language raises the threshold on
unspecified minor construction projects performed with
operations and maintenance funding. Thresholds are increased
to $750,000 for general projects (from $500,000) and to
$1,500,000 for projects involving life safety issues (from
$1,000,000). The O&M unspecified minor construction
thresholds were last raised in 1997.
The current thresholds limit the Services' ability to
complete projects in areas with high costs of construction,
such as overseas and in Alaska and Hawaii. The reality is
$500,000 does not buy much construction, even in ``normal''
cost areas, at a time when the average regular military
construction (MilCon) project costs $12 million. On these
small construction projects, labor costs cut heavily into the
amount of tangible ``brick and mortar'' which any project
must deliver to make a facility usable to its customer.
Without this relief, there may be a two or three year delay
in completing needed small construction projects if MilCon
appropriations must be used, as unspecified minor
construction funds within this appropriation are very limited
and regular MilCon projects must be individually authorized
and appropriated in advance.
Section 717. The proposed legislation seeks authority for
Federal tenants to obtain facility services and common area
maintenance directly from the local redevelopment authority
(LRA) or the LRA's assignee as part of the leaseback
arrangement rather than procure such services competitively
in compliance with Federal procurement laws and regulations.
This authority to pay the LRA or LRA's assignee for such
services under this authority would be allowed only when the
Federal tenant leases a substantial portion of the
installation; only so long as the facility services or the
specific type of common area maintenance are not of the type
that a state or local government is obligated by state law to
provide to all landowners in its jurisdiction for no
individual cost; and only when the rate charged to the
Federal tenant is no higher than that charged to non-Federal
entities. The proposed legislation also expands the
availability of using leaseback authority for property on
bases approved for closure in BRAC 1988.
A leaseback is when the Department of Defense transfers
nonsurplus base closure (BRAC) property by deed or through a
lease in furtherance of conveyance to an LRA. The transfer
requires the LRA to lease the property back to the Federal
Department or Agency (Federal tenant) for no rent to satisfy
a Federal need for the property.
[[Page S7241]]
Current leaseback legislation does not exempt Federal
tenants from Federal procurement laws and regulations when
they attempt to obtain facility services and common area
maintenance, such as janitorial, grounds keeping,
utilities, capital maintenance, and other services that
are normally provided by a landlord. Compliance with the
procurement laws and regulations may result in a third
party contractor providing such services for facilities
leased from the LRA and for common areas shared by other
tenants of the LRA. In many cases, this may conflict with
the LRA's or its assignee's arrangements for providing
such services to the various tenants on property owned or
held by the LRA. The LRA usually prefers that its
contractor perform such services on behalf of the LRA's
tenants. LRAs have been hesitant in using leaseback
arrangements due to the Federal tenants' inability to
obtain these services directly from the LRAs or share the
common area maintenance costs with other tenants of the
LRAs.
Under current law, only property at BRAC '91, '93, and '95
closure installations can be transferred under the leaseback
authority. To help minimize small Federal land holdings
within larger parcels transferred to the LRA on BRAC '88
bases, the leaseback authority should be expanded to apply to
BRAC '88 installations.
Section 718. The proposed change would allow the Military
Departments to reimburse the Military Personnel
appropriations from Military Construction, Family housing
appropriations during the first year of execution of a
military family housing privatization project. Members
occupying privatized housing are entitled to, and receive,
housing allowances. Since housing allowances are paid from
the Military Personnel appropriations, the Military
Department needs to reimburse these appropriations for the
increased housing allowance bill caused by privatization from
the funds previously programmed and budgeted in the Military
Construction, Family Housing appropriations. Providing the
flexibility to reimburse these funds at the time of execution
will enable the Services to accurately determine how much
should be reimbursed to meet housing allowance requirements.
It is extremely difficult to predict when the project will
be awarded and therefore to program the correct amount of
funds at the correct time. Transferring funds into military
personnel appropriations early has proven to be premature and
led to shortfalls in the Family Housing appropriation. For
example, the Army estimates that Family Housing, Army will
lose approximately $100 million from FY98 through FY01 due to
the premature transfer of funds to Military Pay and
subsequent slippage in privatization awards. Such losses
cannot be reversed since there is no mechanism to reprogram
from Military Personnel appropriations back into Family
Housing following the passage of the respective appropriation
bills into law. This proposal precludes unnecessary
shortfalls in the family housing appropriations created when
premature transfers leave the Military Departments without
the resources to continue funding installations experiencing
privatization slippage.
Section 719. The report requires an extensive manpower
effort. The Department's budget submission, budget testimony
and responses to other report and statutory requirements,
etc., provide Congress with much of the same information as
required in this report. The Services can provide specific
data more efficiently on an as-needed basis.
In addition, this report was recommended for termination in
1995 based on survey data collected in response to the
Paperwork Reduction Act, with estimated cost savings of at
least $50,000 per year.
Section 801 amends section 5038(a) of title 10, United
States Code, which requires that there be a Director for
Expeditionary Warfare within the Office of the Deputy Chief
of Naval Operations for Resources, Warfare Requirements and
Assessments.
A recent organizational alignment split the functions of
the Deputy Chief of Naval Operations for Resources, Warfare
Requirements, and Assessments into two distinct Deputy Chiefs
of Naval Operations. In this alignment, the Director for
Expeditionary Warfare maintains the same role and
responsibilities but now falls under the Deputy Chief of
Naval Operations for Warfare Requirements and Programs.
This proposal reflects that organizational change.
Section 802 amends chapter 6 of title 10, United States
Code, by adding a new section 169 to consolidate the various
existing legal authorities governing the DoD Regional Centers
to ensure each of the Regional Centers can operate under the
same set of authorities, which will ensure they can operate
effectively.
The Department of Defense Regional Centers for Security
Studies are an important national security initiative
developed by Secretary Cohen and his predecessor, William
Perry. These Centers, which serve as essential institutions
for bilateral and multilateral communication and military and
civilian exchanges, now exist for each major region--Europe,
Asia, Latin America, Africa and most recently for the Middle
East.
The Regional Centers are very important tools for achieving
U.S. foreign and security policy objectives, both for the
Secretary of Defense and for the regional CINCS. The Centers
allow the Secretary and the CINCs to reach out actively and
comprehensively to militaries and defense establishments
around the world to lower regional tensions, strengthen
civil-military relations in developing nations and address
critical regional challenges. The Department has had
extremely good results with the Centers in each region. For
example, more than twenty Marshall Center graduates are now
ambassadors or defense attaches for their countries and
another twenty serve as service chiefs or in other similarly
influential positions.
Currently the five Regional Centers operate under a
patchwork of existing legal authorities. As each new center
was established, new legislation was passed to govern each
center. As a result, no single center has the same set of
legal rules guiding how it can operate. The patchwork of
authorities hinders effective management and oversight of the
Centers, and provides broad authority for some Centers but
only limited authority for other Centers.
A central component of the department's proposal would
ensure that all DoD Regional Centers are able to waive
reimbursement of the costs of conferences, seminars courses
of instruction and other activities associated with the
Centers. The proposal also would ensure that all Centers
could accept foreign and domestic gifts, hire faculty and
staff, including directors and deputy directors, and invite a
range of participants to the Centers. Without these
authorities, the Regional Centers will not be able to operate
at maximum effectiveness.
Both the Marshall Center and the Asia-Pacific Center for
Security Studies, the oldest of the five Centers, have
specific authority to waive reimbursement of costs associated
with participating in center activities. The Center for
Hemispheric Defense Studies also has authority to waive
costs, but its authority falls under a different provision of
title 10, United States Code, than the similar authorities
for the Marshall Center and the Asia-Pacific Center. The
Africa Center for Strategic Studies and the Near East-South
Asia Center can waive some costs under section 1051 of title
10, but this authority is more limited than the authorities
under which the other three Centers operate.
The ability to waive reimbursement of certain costs
associated with participating in center activities is
absolutely critical to the effectiveness of the Regional
Centers as engagement tools for both the Secretary of Defense
and the regional CINCS. Many participants in center
activities are from developing countries that cannot afford
to send personnel to institutions like the regional Centers.
Without the authority to waive reimbursement of certain
costs, most participants from developing countries would not
attend the Centers. In contrast, consistent with existing
authorities, most participants from developed nations, whose
contributions provide balance, shared regional leadership and
non-U.S. perspectives, pay for their own travel, lodging,
meals and expenses in connection with Center courses.
Section 802 would provide the authority to waive
reimbursement of certain costs associated with the Centers to
all of the Regional Centers by repeating the diverse set of
existing authorities concerning cost issues and instead
providing a single legal provision concerning cost waivers
for all of the Centers.
In addition to providing a single authority for the Centers
to waive reimbursement of costs, the proposal also ensures
that other existing authorities governing the Regional
Centers apply to all of the Centers. By ensuring that all of
the Centers can accept foreign and domestic gifts, hire
faculty and staff, and invite participants from defense-
related government agencies and non-governmental
organizations, the proposal will improve the Centers in
several ways. First, by gaining the authority to accept
gifts, all Centers will be able to cover a greater percentage
of their operating costs using funds from outside the
Department budget. Allowing both public and private foreign
institutions to contribute to regional Centers operations
also will enhance the involvement of those donor countries in
the Centers and strengthen their commitment to the missions
of the Centers. In terms of participation, the Centers in
many cases are unique in their ability to bring together
participants from across the spectrum of the national
security establishment in their respective countries.
Broadening this pool to include participants from non-
governmental organizations and legislative institutions will
further strengthen the quality of discussion at the Centers
and help establish additional important professional
relationships among participants from the various regions.
Finally, enactment of section 802 would confirm the
authority of the Secretary of Defense to manage all the
Centers effectively. The combination of diverse legal
authorities and unique organizational structures has made
effective management and oversight of the Centers quite
challenging. To address this management challenge, the
Department created a Management Review Board last year
(2000). The MRB is comprised of the Assistant Secretary of
Defense (International Security Affairs) and the Director of
the Joint Staff, or their designees, and members from the
Comptroller, Program Analysis and Evaluation, General
Counsel, Joint Staff and the Services. The DoD proposal to
consolidate existing, legal authorities concerning the
Regional Centers and apply them to all of the Centers will
further improve the ability of the MRB to ensure that the
Regional Centers are thoroughly incorporated into the
Department's broader engagement strategy and funded
appropriately.
[[Page S7242]]
This proposal provides no new spending authority. No
additional resources are needed to implement these changes
and as the existing departmental management structure
matures, the Department expects to realize greater
efficiencies in the management of the Regional Centers.
Section 803 would amend all references to the former
``Military Airlift Command'' contained in title 10 and title
37 to refer to the command by its current designation as the
``Air Mobility Command.'' By Special Order AMC GA-1, 1 June
1992, Air Mobility Command replaced the Military Airlift
Command as a United States Air Force Major Command. This
change was previously recognized to a certain extent in title
10, United States Code 130a (Management headquarters and
headquarters support activities personnel; limitation),
subparagraph (d) (Limitation on Management Headquarters and
Headquarters Support Personnel Assigned to United States
Transportation Command), which specifically identified Air
Mobility Command as a component command of United States
Transportation Command. That provision in section 130a was
deleted by section 921 of Public Law 106-65, 5 October 1999.
As Military Airlift Command no longer exists and Air Mobility
Command is not referenced in any statute, updating the listed
provisions of the United States Code is appropriate.
Section 804 would amend section 1606 of title 10, United
States Code, to increase the number of Defense Intelligence
Senior Executive Service (DISES) positions authorized within
the Defense Civilian Intelligence Personnel System (DCIPS)
from 517 to 544. Enactment of the proposed amendment would
enable the Secretary of Defense to allocate the 27 additional
DISES positions to the National Imagery and Mapping Agency
(NIMA), as the Director of Central Intelligence (DCI)
simultaneously cuts 27 Senior Intelligence Service (SIS)
positions from the Central Intelligence Agency (CIA).
When section 1606 was inserted into title 10, United States
Code, by section 1632(b) of the Department of Defense
Intelligence Personnel Policy Act of 1996 (Public Law 104-
201; 110 Stat. 2745, 2747) the number of DISES positions was
set at 492. This ceiling, however, was raised to 517
positions by section 1142 of the Floyd D. Spence National
Defense Authorization Act for Fiscal Year 2001 (Public Law
106-398; 114 Stat. 1654).
The conference report accompanying the Floyd D. Spence
National Defense Authorization Act for Fiscal Year 2001,
however, states that these ``25 additional positions are
authorized for the entire defense intelligence community and
are not intended to be allocated to any single agency within
the defense intelligence community.'' See H.R. Rep. No. 106-
945 at 865 (2000). The report also directed ``the Secretary
of Defense to report to the Committees on Armed Services of
the Senate and the House of Representatives, not later than
March 15, 2001, on how the additional senior executive
service positions are allocated within the defense
intelligence community.'' H.R. Rep. No. 106-945 at 865
(2000).
Based on this guidance, the 25 new DISES positions are
being reviewed for use and distribution within the DCIPS
community as a whole. This expansion of DISES positions
within the general DCIPS community, however, does not address
a pressing need to allocate an additional 27 DISES positions
to NIMA as part of a Congressionally mandated administrative
transfer intelligence positions from CIA to NIMA.
Since DCIPS and NIMA were created in 1996, NIMA has been
staffed at senior levels by DISES personnel, Defense
Intelligence Senior Level (DISL) personnel, and SIS
personnel. It should be noted in this regard, however, that
when the initial DCIPS cap was set at 492, the 27 positions
that CIA filled with SIS personnel on temporary detail were
not included in the 492 figure.
One of the complex aspects of the establishment of NIMA,
was the commingling of intelligence officials from the
Department and other federal agencies that was needed to
staff the new agency. But, in establishing NIMA the Congress
made it clear that this unique staffing arraignment would be
temporary. In section 1113 of the National Imagery and
Mapping Agency Act of 1996 (Public Law 104-201, 110 Stat.
2675, 2684) the Congress expressly provided that: ``Not
earlier than two years after the effective date of this
subtitle, the Secretary of Defense and the Director of
Central Intelligence shall determine which, if any, positions
and personnel of the Central Intelligence Agency are to be
transferred to the National Imagery and Mapping Agency. The
positions to be transferred, and the employees serving in
such positions, shall be transferred to the National Imagery
and Mapping Agency under the terms and conditions prescribed
by the Secretary of Defense and the Director of Central
Intelligence.''
In keeping with this congressional mandate, the Secretary
and the DCI signed a Memorandum of Agreement (MOA) in
February 2000 that set the total number of positions to be
transferred from CIA to NIMA. Under the agreement, CIA
personnel that are currently temporarily detailed to NIMA
would be permanently detailed to NIMA; These employees,
however, would remain as CIA employees. Budget agreements
implementing the MOA also provide that the previously
discussed 27 SIS positions would be included in the total
number of 56 positions to be transferred from CIA to NIMA.
These agreements also provide that in conjunction with the
transfer of these 27 senior level positions to NIMA, CIA
would cut 27 SIS positions. Consequently, the enactment of
the proposed amendment would have no budgetary impact,
because the increase of the DISES ceiling is offset by the
corresponding reduction of SIS positions at CIA.
Section 811 would amend section 10541 of title 10
concerning the annual report to Congress on National Guard
and Reserve Component equipment. During the preparation of
the budget year 2000 National Guard and Reserve Component
Equipment Report, it became clear that changes were needed to
both the report and process in order to make the report more
relevant to Congress. As a result, a joint working group was
commissioned from the Office of the Assistant Secretary of
Defense for Reserve Affairs to analyze the report and
process. Key changes were coordinated with all Services and
are included in the legislative proposal above.
Specifically, subsection (a) would adjust the date of the
report from February 15th to March 1st of each year. This
would allow time to incorporate the President's budget
projections into the report, thus making the report a more
meaningful and up-to-date report during the Congressional
legislative process. It would also officially require data
from the U.S. Coast Guard Reserve, which has been provided in
past years but is not required by law.
Subsection (b) would eliminate the requirement for data
that is no longer viable, such as the full wartime
requirement of equipment over successive 30-day periods and
non-deployable substitute equipment. It would also expand the
requirement for the current status of equipment compatibility
to all Reserve Components, instead of just for the Army.
Overall, the revised subsection (b) is written to expand the
scope and remove the restrictive nature of the language. This
would provide the Reserve Components the ability to present a
clearer and more complete picture of the Reserve Component
equipment needs.
Section 812 would repeal subsection 153(b) of title 10 and
amend section 118(e) to consolidate redundant reporting
requirements related to the assessment of service roles and
missions. Subsection 153(b) requires the Chairman to submit
to the Secretary of Defense, a review of the assignment of
roles and missions to the armed forces. The review must
address changes in the nature of threats faced by the United
States, unnecessary duplication of effort among the armed
forces, and changes in technology that can be applied
effectively to warfare. The report must be prepared once
every three years, or upon the request of the President or
the Secretary.
Section 118 of title 10 established a permanent requirement
for the Secretary to conduct a Quadrennial Defense Review
(QDR) in conjunction with the Chairman. The Department of
Defense has designed the QDR to be a fundamental and
comprehensive examination of America's defense needs from
1997-2015; to include assessments of potential threats,
strategy, force structure, readiness posture, military
modernization programs, defense infrastructure, and other
elements of the defense program. Amending subsection
118(e) would explicitly require the Chairman's review of
the QDR to include an assessment of service roles and
missions and recommendations for change that would
maximize force efficiency and resources.
Simultaneously preparing the QDR and the roles and missions
study requires the concentrated efforts of many Joint Staff
action officers for a period of more than eighteen months.
Eliminating this duplication of effort, however, will
significantly enhance the Joint Staff's ability to meet an
expanding list of congressionally or Department of Defense
mandated reporting requirements on a wide variety of
sensitive defense topics. These topics include joint
experimentation, training, and integration of the armed
forces, examination of new force structures, operational
concepts, and joint doctrine; global information operations;
and homeland defense, particularly with regard to managing
the consequences of the use of weapons of mass destruction
within the United States, its territories and possessions.
Section 813 would change the due date for the Commercial
Activities Report to Congress, required by section 12461(g),
title 10, United States Code, from February 1st of each
fiscal year to June 30th of each fiscal year. The Commercial
Activities Report is developed using the same in-house
inventory database as the Department's Federal Activities
Inventory Reform Act (FAIR Act) submission. Under the FAIR
Act, the Department is required to submit an inventory of
commercial functions each Fiscal Year. That inventory is
subject to challenges by interested parties. In order to
ensure that the Commercial Activities Report is as accurate
as possible and consistent with other reports submitted to
Congress covering the same Fiscal Year, it is necessary to
consider the FAIR inventory challenges when compiling it.
This process is normally not complete until April or May of
each year. In past years, the Department has submitted an
interim response to Congress regarding the Commercial
Activities Report indicating that the report would not be
submitted until June.
Section 821 would amend section 2572 of title 10. Section
2572(a) authorizes the Secretary of a military department to
lend or give certain types of property described in section
2572(c) that are not needed by the department to specified
entities, such as municipal corporations, museums, and
recognized war veterans' associations. Section
[[Page S7243]]
2572(b) authorizes the Secretary of a military department to
exchange the items described in section 2572(c) with any
individual, organization, institution, agency, or nation if
the exchange will directly benefit the historical collection
of the armed forces.
Section 821 would expand the categories of property that
the military departments may exchange under section 2572(b).
Currently, the military departments may exchange books,
manuscripts, drawings, plans, models, works of art,
historical artifacts and obsolete or condemned combat
materiel for similar items. Property may also be exchanged
for conservation supplies, equipment, facilities, or systems;
search, salvage, and transportation services; restoration,
conservation, and preservation systems; and educational
programs. The amendment would expand the current authority to
exchange ``condemned or obsolete combat material'' and
authorize the military departments to exchange any ``obsolete
or surplus material'' of a military department for ``similar
items'' and for the enumerated services if the items or
services will directly benefit the historical collection of
the armed forces.
Section 822 would amend section 2640 of title 10, United
States Code. This section requires the Department of Defense
to meet safety standards established by the Secretary of
Transportation under section 44701 of title 49, United States
Code and requires air carriers to allow the Department of
Defense to perform technical safety evaluation inspections of
a representative number of their aircraft. This amendment
would require the same safety standards be applied to foreign
air carriers as to the domestic air carriers in an effort to
provide better protection to members of the armed forces.
Section 822(2) would require ``check-rides'' to be
accomplished on carriers. As DOD personnel conducting the
inspection are usually not qualified pilots in all the
various types of aircraft they are required to inspect, the
term ``cockpit safety observations'' more accurately describe
the process involved.
Section 822(3) of the proposal would designate authority
within the Department of Defense to delegate a representative
to make determinations to leave unsafe aircraft. This change
is a technical change to update the command name from
``Military Airlift Command'' to its successor ``Air Mobility
Command''.
Section 822(4) of the proposal would authorize the
Secretary of Defense to waive the requirements of the statute
in an emergency, based on the recommendation of the
Commercial Airlift Review Board. As paragraph (1) would
extend the inspection requirements to foreign air carriers,
there may be instances that do not constitute an emergency
but because of operational necessity a waiver may be
appropriate. An example would be where there is only one
carrier available in a foreign country but the host
government will not allow an inspection on sovereignty
principals. If all other information available to the
Commercial Airlift Review Board indicate a safe air carrier,
a waiver may be appropriate.
Section 822(5) would amend subsection (j) of section 2640
title 10 United States Code that states certain terms listed
therein have the same meanings as given by section 40102(a)
of title 49 of the United States Code. ``Air Carrier'' is
listed in subsection (j) and is defined in title 49 as a
``citizen of the United States undertaking by any means,
directly or indirectly, to provide air transportation.''
Deleting ``air carrier'' from the definition section in
addition to the changed in paragraph (1) will allow the
safety standards to be applied equally to foreign and
domestic carriers.
If enacted, this proposal will not increase the budgetary
requirements of the Department of Defense.
Section 901 would amend title 10 by adding a new section
23501 to authorize the Secretary of Defense, with the
concurrence of the Secretary of State, to enter
agreements, at reasonable cost, with eligible countries
and international organizations, for the reciprocal use of
ranges and other facilities where testing may be
conducted. As military equipment becomes more complex, so
does the need for more advanced, complex, and costly test
and evaluation capabilities. In this environment, it is
increasingly difficult and expensive for one nation to
fulfill all of its legitimate research, development, test
and evaluation (RDT&E) requirements at ranges and
facilities under its control.
One way to reduce the cost of developing the next
generation of U.S. weapons, and those of our friends and
allies, is to take full advantage of the unique test
capabilities available here and abroad. For example, the
United Kingdom has a unique Artillery Recovery Range in
Shoeburyness where we may recover rounds undamaged after
firing for engineering evaluation. This uniqueness of the
range comes from its geography. Shoeburyness lies on a gently
sloping shoreline that extends for several miles before
terminating in a large tidal basin from which undamaged spent
rounds may be recovered with ease. No other facility in the
world provides this capability. Similarly, the United States
has unique test capabilities not available in other
countries. The 8+ Mach test track at Holloman Air Force Base
in N.M. is unequaled anywhere in the world. Unfortunately,
under current authority, it is often cost-prohibitive for the
United States and the United Kingdom, for example, to reach
an agreement that would allow each country to use the other's
facilities to develop superior weapons to meet 21st Century
challenges.
To obtain access to foreign ranges and facilities at
reasonable rates, the Department needs new authority to
provide eligible countries or international organizations
reciprocal access, at reasonable rates, to U. S. facilities;
and the enactment of this proposal would provide that new
authority.
As the Secretary of Defense observed in a memorandum dated
March 23, 1997: ``International Armaments Cooperation is a
key component of the Department of Defense Bridge to the 21st
Century. We already do a good job of international
cooperation at the technology end of the spectrum; we need to
extend this track record of success across the remainder of
the spectrum.''
Reciprocal use of test and evaluation ranges and facilities
is the next step in this process, and one that will expand
long-standing international partnerships the United States
has enjoyed in the equipment acquisition process. In this
regard, the Department notes that the Congress ``has
supported a number of [Department of Defense] initiatives to
help offset the growing burden of [RDT&E] infrastructure
support cost.'' See S. Rep. No. 104-12, at 176-77 (1995). It
is also worthy of note that the Congress has encouraged the
Department to engage in such cooperative ventures by stating
in the same report: ``our allies are showing a much greater
interest in using U.S. test ranges and facilities because of
encroachment problems overseas, and the Department should be
more aggressive in encouraging and facilitating such
request.'' See S. Rep. No. 104-12, at 177 (1995).
Enactment of the authority granted in subsection (a) of
this proposal would also enhance interoperability at all
weapon system and force levels; and interoperability is the
cornerstone of Joint Vision 2020. It is axiomatic, that
interoperability between U.S. forces, and coalition or allied
forces, enhances the effectiveness of the combined force to
act in concert to deter or defeat aggression. Accordingly,
continued success in regional conflicts depends on continuous
improvement of U.S. interoperability with our friends and
allies around the globe.
No additional funds are required to implement the authority
granted in subsection (a) of this proposal. Testing services
will be paid for by customers according to the principles and
provisions prescribed in the proposal and negotiated in a
Memorandum of Understanding. Pricing principles call for
reasonable and equitable charges between partner countries.
Matters concerning security, liability and similar issues
will be fully addressed in Memorandums of Understanding (or
other formal agreements) entered based on this proposal.
Section 901(c) would amend Section 2681 of title 10, United
States Code, ``Use of Test and Evaluation Installations by
Commercial Entities.'' Section 2681 was enacted in 1994 to
provide greater access for commercial users to the Major
Range and Test Facility Base Installations. The section
requires a commercial entity to reimburse the Department of
Defense for all direct costs associated with the test and
evaluation activities. In addition, commercial entities can
be charged indirect costs related to the use of the
installation, as deemed appropriate.
The Major Range and Test Facility Base (MRTFB) is a set of
installations and organizations operated by the Military
Departments principally to provide T&E support to defense
acquisition programs. Historically, defense acquisition
programs used the MRTFB for testing, with the Department of
Defense component serving as the actual customer. The
acquisition program approved the work statement and provided
funding through a funding document issued directly to the
test organization. In response to acquisition reform
initiatives, most program managers now leave the decision of
where to perform (developmental) testing to the contractor.
Nonetheless, many contractors choose to test at MRTFB
activities because of the facilities and expertise available.
In other cases, technical requirements drive them to the
MRTFB as the only source of adequate T&E support. Under
section 2681, defense contractors are charged as commercial
entities, even though the use of the range is in direct
support of the Department of Defense component.
In the past, MRTFB Installations did not charge defense
contractors a fully burdened rate to use their facilities
when conducting test in association with a defense contract.
A Service audit finding opined that the MRTFB installations
had misapplied the law and determined defense contractors to
be commercial users, thereby requiring them to be charged the
fully burdened rate. However, weapons programs have prepared
their budgets under the assumption that the fully burden rate
would not be charged to the defense contractors acting on
their program's behalf. The amendment proposed in subsection
(c) of this proposal would make MRTFB test and evaluation
services available to defense contractors under the same
access and user charge policies as applied to the sponsoring
Department of Defense component. This would assure that the
MRTFB is able to perform its fundamental role of support
to defense acquisition programs under the same policies as
existed prior to section 2681, while continuing to leave
the choice of ``where to test'' to the defense contractor.
In addition, the amendment proposed in subsection (c) of
this proposal would extend this concept to the contractors
of other U.S. government agencies. If section 901(c) is
not enacted, there may be a cost increase to specific
research and development programs.
Section 902 would amend 10 U.S.C. Sec. 2350a to improve the
Department's ability to enter
[[Page S7244]]
into cooperative research and development projects with other
countries. This amendment would incorporate references to the
term: ``Major non-NATO ally'' to allow countries like
Australia, South Korea or Japan to be recognized, not just as
other friendly foreign countries, but as major allies.
Section 903 would amend chapter 53 of title 10, United
States Code, to provide the Secretary of Department the
authority to recognize superior noncombat achievements or
performance by members of friendly foreign forces and other
foreign nationals that significantly enhance or support the
National Security Strategy of the United States.
Currently, the Department's authority to recognize superior
achievements and performance by foreign nationals is limited
to awarding military decorations to military attaches and
other foreign nationals for individual acts of heroism,
extraordinary achievement or meritorious achievement, when
such acts have been of significant benefit to the United
States or materially contributed to the successful
prosecution of a military campaign of the Armed Forces of the
United States. See sections 1121, 3742, 3746, 3749, 6244-46,
8746, and 8749-50, of title 10, United States Code, and
Executive Orders 11046 and 11448.
The vast majority of engagement programs conducted by the
Department of Defense, in support of the national Security
Strategy, however, do not involve diplomatic contacts, or
heroic acts, but unit-level engagement and cooperation
between U.S. servicemembers and foreign nationals, in a
variety of training, exercise, and peacetime operational
settings. In these instances, many of these expenses that
would be authorized by this proposal are currently being paid
out of the pockets of soldiers, sailors, airmen, Marines, and
members of the Coast Guard.
One of many examples of how this gap in legislative
authority adversely impacts on American servicemembers is the
experience of the United States Army Special Forces Command
(Airborne). Since the first Special Forces unit was activated
on June 19, 1952, Special Forces personnel have routinely
deployed overseas to: train U.S. allies to defend themselves
and counter the threat of dangerous insurgents, in so doing,
Special Forces personnel often serve as teachers and
ambassadors. As a result, the Special Forces Command is often
called upon by regional combatant commanders, American
Ambassadors, and other agencies to participate in a wide
variety of peacetime engagement events, because of its global
reach, regional focus, cultural awareness, language skills
and military expertise.
During Fiscal Year 2000, the command had 2,102 personnel
deployed on 81 missions in 51 countries. The activities
conducted during these deployments included peace operations
in the Balkans, humanitarian demining operations worldwide,
deployments in support of the Department of State, African
Crisis Response Initiative, joint and combined exercise
training, counterdrug operations, and mobile training team
deployments. In addition, elements of the command host annual
marksmanship and other international competitions involving
military skills.
During this period of time members of the Special Forces
Command participated in 328 deployments that required the
purchase or production of plaques, trophies, coins,
certificates of appreciation or commendation and other
suitable mementos for presentation to foreign nationals.
These items were used to recognize achievements such as
placing first, second or third in competitions, graduating at
the top of formal training courses, and other acts meriting
recognition by U.S. officials. Since the authority to present
military awards for valor, heroism or meritorious service as
outlined above generally does not apply to such expenses, the
men and women of the command have a long tradition of paying
such expenses out of their own pockets, or from funds
received from private organizations such as the Special
Forces Association.
Assuming that the expenditures for such items during the
328 deployments conducted by the Special Forces Command in
fiscal year 2000, averaged $260.00 per deployment (the
current ``minimal value'' threshold set by section 7342(a)(5)
of title 5, United States Code), the men and women of that
command would have spent $85,280.00 out of their own pockets,
or obtained donations from private organizations such as the
Special Forces Association, in order to carry out these
missions.
Enactment of this proposal would enhance the execution of
Department engagement programs, by providing another means of
establishing goodwill today that will contribute to improved
security relationships tomorrow. But most importantly, it
would relieve servicemembers from the need to pay such
expenses out of pocket, by authorizing commanders to pay for
these expenses from the budgets allocated to them to conduct
these critical missions.
Section 904 would give the Department of Defense (DoD) the
personal service contract authority currently exercised by
other agencies with overseas activities, It would allow DoD
to hire the in-country support personnel necessary to carry
out its national security mission, particularly in the newly
independent states.
In those countries where the DoD does not have a Status of
Forces Agreement or does not have a major military presence
including a program for civilian personnel administration of
local national employees, that service has traditionally been
performed on a reimbursable basis by the Department of State
(DOS). DOS has used its personal service contract authority
to provide workers for DoD units such as Defense Attache
Offices, Security Assistance Offices, and Military Liaison
Teams, that are frequently co-located with the U.S. Embassy
and may come under Chief of Mission authority. DoD does not
have personal service contract authority and DOS counsel
recently determined DOS is prohibited from using its
personal service contract authority to provide workers for
an agency that does not have such authority.
DOS has begun terminating personnel service contracts that
support DoD requirements. DoD units have been faced with the
need to either use a non-personal service contract or obtain
Full-Time Equivalent (FTE) authority. Use of non-personal
service contracts may be inappropriate for the type of work
performed, cause security and access problems at the Embassy,
and be in violation of local labor law. FTE has not been
readily available to support time-limited programs such as
the Partnership for Peace and Military Liaison Teams. FTE has
been particularly difficult to obtain for overseas units that
are under headquarters constraints such as for the OUSD
(Policy) office that supports arms control delegations in
Geneva.
Section 911 would amend section 1153 of the Floyd D. Spence
National Defense Authorization Act for Fiscal Year 2001
(NDAA) to limits on the use of voluntary early retirement
authority and voluntary separation incentive pay for fiscal
years 2002 and 2003. Section 1153 authorized the Department
to use Voluntary Separation Incentive Pay (VSIP) and
Voluntary Early Retirement Authority (VERA) for workforce
restructuring for three years. In the past, VERA and VSIP
could only be used in conjunction with reduction in force.
Under this new authority, it is no longer necessary to
abolish a position in order to grant early retirement or pay
the incentive. The vacant position may be refilled with an
employee with skills critical to the Department. This is
necessary to shape the Defense workforce of the future.
Section 1153 authorized these programs to be carried out
for workforce restructuring in FY 2002 and FY 2003 ``only to
the extent provided in a law enacted by the One Hundred
Seventh Congress.'' This provision would satisfy that
requirement.
Section 912 would amend section 1044a title 10 to clarify
the status of civilian attorneys to act as notaries. Section
1044a(b)(2) authorizes ``civilian attorneys serving as legal
assistance officers'' to perform notarial services. Civilian
attorneys have no designation under Office of Personnel
Management position descriptions as legal assistance
``officers.'' Within Department of Defense documents,
civilian attorneys providing legal assistance services are
referred to as legal assistance attorneys. For this and other
reasons related to the efficient management of legal
assistance offices, subsection (b) would amend section
1044a(b)(2) to refer to legal assistance attorneys.
Section 912(b) would amend section 1044a(b)(4) of title 10
to expand a category of persons who may perform notarial acts
under the section. Section 1044a(b)(4) authorizes members of
the armed forces who are designated by regulation to perform
notarial acts. As amended, subsection (b)(4) would authorize
civilian employees of the armed forces to perform notarial
acts if they are designated by regulations of the armed
forces to have notarial powers. This would alleviate a
particular problem overseas, where military notaries are not
always available. The change would allow the Service
Secretaries, and the Secretary of Transportation with respect
to the Coast Guard, to extend notary authority to civilian
nonlawyer assistants, e.g., 64 paralegals and legal
assistance office in-take personnel.
Section 913 would amend section 2461 of title 10 concerning
the conversion of commercial or industrial type functions to
contractor performance. Federal agencies may convert
commercial activities to contract or interservice support
agreement without cost comparison under Office of Management
and Budget Circular A-76 (A-76) when all directly affected
Federal employees serving on permanent appointments are
reassigned to other comparable Federal positions for which
they are qualified. This revision would make the statutory
requirements inapplicable under these same circumstances.
The analysis requirements of section 2461 of title 10,
United States Code, are met using the commercial activities
study procedures of A-76 and the Revised Supplemental
Handbook, Such studies typically take two to four years to
reach an initial decision. When the result of the study is a
conversion of a function to contract performance, affected
Federal employees may be subject to reduction-in-force
procedures. The proposed statutory revision would permit
Department of Defense activities to convert a function to
contract performance without incurring the potential length
and cost of an A-76 study. This revision would not alter the
requirements of section 2641 where an A-76 study is
undertaken. It would not alter the rights of employees who
are sub9ect to an A-76 study.
Section 914 clarifies that former Defense Mapping Agency
personnel transferred into the National Imagery and Mapping
Agency pursuant to the National Defense Authorization Act for
Fiscal Year 1997, Public Law 104-201, retain third party
appeal rights under chapter 75 for such time as they remain
Department of Defense employees employed without a break in
service in the National
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Imagery and Mapping Agency. The section also permits the
employees so affected to waive the provisions of this
section. However, by doing so, the employee forfeits his or
her rights under this section. Personnel who have those
rights and who are assigned or detailed by NIMA to positions
of the CIA or other agencies would retain those rights vis-a-
vis NIMA while assigned or detailed to those positions.
Section 915 would allow the Secretary of Defense to provide
the Director, NIMA the authority to set up a critical skills
undergraduate training program parallel to those authorized
to NSA, DIA, CIA, and the military departments. These
programs are intended to further the goal of enhanced
recruitment of minorities for careers in the Intelligence and
Defense Communities. Under these programs agencies recruit
high school graduates who otherwise would not qualify for
employment and then send them to obtain undergraduate degrees
in critical skills areas such as computer science. These
employees are required to commit to remaining in the
Government for specified payback periods. No costs are
anticipated in fiscal year 2002. Fiscal year 2003 costs are
currently estimated at less than $1,000,000. This proposal
imposes no costs on other organizations.
Section 916 would add a new section to title 10, United
States Code, and would establish a three-year pilot program
permitting payment of retraining expenses for DoD
employees scheduled to be involuntarily separated from DoD
due to reductions-in-force or transfers of function. In
the National Defense Authorization Act for Fiscal Year
1995, a pilot program of this nature was established for
employees affected by BRAC. (See Public Law 103-337,
Section 348.)
The program, which may be created at the discretion of the
Secretary of Defense, focuses on permitting a company to
recoup the costs it incurs in training an employee for a job
with that company. The purpose of this incentive is to
encourage non-Federal employers to hire and retain
individuals whose employment with DoD is terminated. To be
eligible for the reimbursement, a company must have employed
the former DoD employee for at least 12 months. In short,
this proposal allows payment for training for a specific job;
it is not designed towards generic, non-job specific
training.
Expanded use of incentives such as contained in this
proposal would provide DoD with an enhanced management tool
to reduce adverse impacts on employees. Availability of this
option would also reduce costs associated with VSIP payments
and the placement of employees through the DoD Priority
Placement Program.
Section 921 responds to section 1051 of the Strom Thurmond
National Defense Authorization Act for Fiscal year 1999
(Public Law 105-261), which identified the need for improved
procedures for demilitarizing excess and surplus defense
property. The proposal would amend Title 10, United States
Code, to permit the United States to recover Significant
Military Equipment (SME) that has been released by the
Government without proper demilitarization. In recent years,
the possession of improperly demilitarized Department of
Defense property by individuals and business entities has
caused grave concern both in the media and in Congress and
has been a topic of study for the Defense Science Board.
Questions on the amount of compensation due a possessor of
these materials have arisen in those cases where confiscation
has been permitted. This proposal, if enacted, would provide
needed clarification on several issues. First, it would
codify in law the type of material subject to recovery by
specifically adopting the definition of SME as is contained
in the Code of Federal Regulations. Second, it would permit a
possessor to be compensated in an amount covering purchase
cost, if any, and reasonable administrative costs, such as
transportation and storage costs, assuming the possessor
obtained the property through legitimate channels. Note that
exceptions are provided for certain categories, including
museums and the Civilian Marksmanship program.
Section 922 would revise section 2634 of title 10, and
section 5727 of title 5, United States Code, by exempting
motor vehicles shipped by members of the armed forces and
federal employees from the provisions of the Anti Car Theft
Act of 1992, as amended. The Anti Car Theft Act of 1992, (the
``Act''), codified at Sections 1646b and 1646c of title 19,
United States Code, requires customs officers to conduct
random inspections of automobiles and shipping containers
that may contain automobiles that are being exported, for the
purpose of determining 66 whether such automobiles are
stolen. In addition, the Act requires that all persons or
entities exporting used automobiles, including those exported
for personal use, provide the vehicle identification number
(V.I.N.) and proof of ownership information to the Customs
Service at least 72 hours before the automobile is exported.
The Customs Service is also required, consistent with the
risk of stolen automobiles being exported, to randomly select
used automobiles scheduled for export and check the V.I.N.
against information in the National Crime Information Center
to determine if the automobile has been reported stolen.
Customs Service regulations implementing the Act are at
Section 192.2 of title 19 of the Code of Federal Regulations.
Motor vehicles shipped under the authority of section 2634
of title 10 and section 5727 of title 5 are owned or leased
by members of the armed forces or federal employees and are
being transported out of the country pursuant to the member's
or employee's change of permanent station orders. The vast
majority of motor vehicles shipped under these two provisions
of law belong to Department of Defense personnel, and are for
personal use while the member or employee is abroad. In most
cases, these motor vehicles are returned to the United States
along with the member or employee upon completion of duty
overseas. These motor vehicles are not being exported for the
purpose of entering into the commerce of a foreign country
and normally may not be sold to foreign nationals in the
country to which the military member or employee is assigned.
Their shipment is arranged and normally paid for by the
United States government. In addition, in the case of
military members and Department of Defense civilian
employees, regulations promulgated by the Department of
Defense pursuant to authority granted in Section 2634 of
title 10, require that the member produce adequate proof of
ownership prior to shipment and, in the case of leased
vehicles, proof that the lease has at least 12 months
remaining. Under the circumstances, the chance that any such
motor vehicle may be stolen is extremely remote. In over
fifty years of shipping such motor vehicles overseas, there
have been few, if any, documented cases in which a stolen
vehicle has been shipped overseas by a military member or
federal employee.
Application of the Act to motor vehicles transported under
these sections has had an adverse impact on shipment times
and has resulted in additional expense to the U.S. government
in the form of delayed shipments and costs associated with
random inspections. In addition, it has imposed a burden on
military members and federal employees by requiring
unnecessary and duplicative documentation, and delaying the
transit times of their motor vehicles. Although these costs
and burdens are not extraordinary on an individual basis,
they are unwarranted and wasteful in light of the extremely
remote chance that stolen vehicles may be shipped.
This proposal would exempt shipments of motor vehicles
under these sections from the Act, and provide the authority
to continue to regulate such shipments in a manner that is
consistent with the needs of the various agencies affected.
The revision would also eliminate an ambiguity caused by
section 2634(b) and the new Customs Service regulations. The
refusal to ship a member's vehicle because of the Customs
regulation would entitle the member to government paid
storage for the duration of the overseas tour.
With regard to section 2634 of title 10, Subsection (1)
would delete the word ``surface'' as a limiting factor in
allowing shipment of vehicles by the cheapest form of
transportation if US owned or US flag vessels are not
reasonably available. This deletion will also align section
2634 of title 10 closer to the provisions of section 5727 of
title 5, which does not have such a limitation.
Transportation provided to military members would still be
limited to a cost no higher than the cost of surface
transportation.
If enacted, this proposal will not increase the budgetary
requirements of the Department of Defense or other federal
agencies, and may result in savings from not having to store
the vehicles at government expense.
Section 923 concerns Department of Defense gift
initiatives. The amendments would clarify items which may be
loaned or given under section 7545 of title 10, United States
Code, and give the Secretary express authority to donate
portions of the hull or superstructure of a vessel stricken
from the Naval Vessel Register to a qualified organization.
Amendments to section 7545(a) of title 10 would clarify that
the Secretary may donate either obsolete ordinance material
or obsolete combat material under this section. The proposed
new language is consistent with the Secretary's existing
authority to lend, give or exchange ``obsolete combat
materiel'' to qualified organizations under section 10 U.S.C.
2572, a statute which is similar, but not identical, to
section 7545. Addition of the term ``obsolete shipboard
material''covers items such as anchors and ship propellers,
which are frequently sought from the Navy for use as display
items.
The deletion of ``World War I or World War II'' and
replacement with ``a foreign war'' would allow coverage of
other wars, such as the Korean, Vietnam, and Persian Gulf
wars as well as any future war. The deletion of ``soldiers''
and replacement with ``servicemen's'' would clarify that
associations related to any branch of military service are
qualified organizations.
A new subsection (d) is added because currently no federal
statute expressly addresses the loan or gift of a major
portion of the hull or superstructure of a Navy submarine or
surface combatant. The Navy has received two requests for
large portions of vessels currently slated for scrapping.
These requests pertain to the sail of a Navy submarine (the
uppermost part of a submarine), and the island of the USS
America (the uppermost part of this decommissioned aircraft
carrier). The America's island stands several stories above
its flight deck. The Navy anticipates receiving more
requests, particularly for submarine sails because the Los
Angeles class nuclear submarines, all but one of which are
named after particular American cities, are now being
decommissioned and scrapped. If a vessel can be donated in
its entirety, the Navy should have the authority to donate a
portion of the vessel for use solely as a permanent memorial.
Also, if there is
[[Page S7246]]
a reason that a vessel cannot be donated in its entirety
(e.g., removal of a reactor compartment), this new subsection
would authorize the Secretary to donate any part of the
remainder of the vessel to a qualified organization.
The Secretary of the Navy has existing authority under 10
U.S.C. Sec. 7306 to donate 68 vessels stricken from the Naval
Vessel Register. The Secretary also has existing authority to
donate material and historical artifacts described in 10
U.S.C. 2572 and 7545. A large portion of a vessel does not
fall squarely within the parameters of any of these three
statutes, and thus the new subsection (d) authorizes the
Secretary to lend, give or otherwise transfer portions of a
vessel stricken from the Naval Vessel Register to an
organization listed under subsection (a). Terms and
conditions of any agreement for the transfer of a portion of
a vessel shall include a requirement that the transferee
maintain the material in a condition that will not diminish
the historical value of the material or bring discredit upon
the Navy. Any donation authorized pursuant to this subsection
remains subject to all applicable environmental laws and
regulations. In accordance with section 7545(a), no expense
would be incurred by the United States in carrying out this
section.
The amendments to section 2572 of title 10 would clarify
the eligibility requirements for political subdivisions of a
state to reccive condemned or obsolete combat material for
static display purposes. The operating instruction for the
Aircraft Management and Regeneration Center (AMARC) notes
that aircraft for display purposes cannot ordinarily be given
or loaned to a county without further administrative
paperwork. Since many airports are operated by counties and
other state political subdivisions that are not municipal
corporations, the law as currently written presents a
substantial limitation on the Air Force's ability to provide
aircraft and other historical material for static display at
such county entities.
AMARC's role in donating or loaning military property for
static displays is to be transitioned to the United States
Air Force Museum. Clarifying section 2572(a)(1) to include
counties and other political subdivisions of a state as
permissible recipients of loans and donations would expand
the Museum's ability to foster good will and civic pride in
the United States Air Force and its history through static
displays.
There are several statutes which do treat counties
differently from municipal corporations, particularly with
regard to taxes and services. Section 5520 of title 10 does
list separate definitions for cities and counties for the
purpose of withholding income or employment taxes. The
proposed legislation would not affect these other statutes
nor the distinctions they draw between goverm-nental
entities.
Section 924 would repeal section 916 to resolve an
incongruous and burdensome reporting requirement for the
Chairman of the Joint Chiefs of Staff. The reporting
requirements demanded by this language-particularly
subsection (c)(3), which the Department is unable to comply
with-runs counter to the responsibilities of the CJCS as the
Chairman of the JROC, and will prove to be overly burdensome
without necessarily producing a positive or desired result.
Section 153 of title 10 establishes the CJCS responsibility
to advise the Secretary of Defense on requirements, programs,
and budgets. The JROC, established in section 181 of title
10, assists the CJCS in fulfilling these advisory
responsibilities and this section further establishes that
``the functions of the CJCS, as chairman of the Council, may
only be delegated to the Vice Chairman of the Joint Chiefs of
Staff.'' Other members of the JROC provide inputs to the
JROC Chairman in the form of opinions, advice, and
recommendations, which represent extremely useful
information. However, having received the JROC member's
inputs (including those from the combatant commanders-in-
chief) the CJCS is singularly accountable to provide the
best military advice on joint requirements to the
Secretary.
Appearing before the SASC Subcommittee on Emerging Threats
and Capabilities on April 4, 2000, the Commander-in-Chief of
U.S. Joint Forces Command amplified the point that the JROC
is an advisory body. He provided explicit testimony that his
input to the JROC and attendance at selected JROC meeting is
what matters--not his vote--since the JROC is not a voting
body. Additionally, since JROC deliberations are
characteristically conducted in executive session, there is
no mechanism to collect the specific advice by individual
members.
The CJCS has directed the JROC to refocus on examination of
a broader spectrum of future joint warfighting requirements
and fully to integrate joint experimentation activities into
the requirements, capabilities, and acquisition process. The
raw facts required in the semi-annual report that document a
brief series of today's decisions will not capture the
profound implications of framing operational architectures
and operational concepts on which future decisions will be
judged. Furthermore, in an era in which the Department is
seeking opportunities to reduce the size of management
headquarters, the significant workloads driven by these
reporting requirements will drive workforce requirements in
the wrong direction--and for little return on the investment.
In sum, the reporting requirements will likely prove to be
overly burdensome without meeting Congressional intent. The
intent of this reporting requirement may be met through CJCS,
VCJCS, and others' annual or special testimony, and
occasional specific reports to Congress.
Section 925 would authorize limited access of sensitive
unclassified information for administrative support
contractors. Pursuant to the authority granted in section
129a of title 10, United States Code, the Secretary of
Defense has promulgated personnel policies that promote the
downsizing and outsourcing of administrative support (e.g.,
secretarial or clerical services, mail room operation, and
management of computer or network resources). By employing
such measures, the Department has realized substantial
savings, as often contracting out these services is the least
costly way to perform them consistent with military
requirements and the needs of the Department. In many cases,
however, additional savings must be forgone, because such
duties may require contractors to be exposed to, or require
substantive access to, sensitive unclassified information
such as third party trade secrets, proprietary information,
and personal information protected by the Privacy Act.
Section 926 will allow Andersen AFB to use the sale of
water rights located off the main installation as an
incentive to pay for a new water system located on Andersen
AFB. The authority this proposal would provide to the Air
Force could only be used in conjunction with existing utility
privatization authority under 10 U.S.C. 2688. Subject to the
specific provisions of this proposal, the rules governing a
conveyance under 10 U.S.C. 2688 would apply to
the transaction, including those for competition, fair
market value, and reporting to Congress. The Air Force
desires to obtain offers to replace the current well
system with new wells located on Andersen AFB (the Main
Base or Northwest Field). But this is contingent on there
being adequate potable groundwater on Andersen AFB (Main
Base or Northwest Field). If there is not sufficient
groundwater on Andersen AFB (Main Base or Northwest Field)
to allow use of this authority, subsection (d) authorizes
the Secretary to allow sale of excess water from the
existing wells to help pay for modernization and operation
of a new water system.
Andersen AFB's Main Base and Northwest Field properties
cover an area roughly 8 miles wide and 2-4 miles long (24.5
square miles). Andersen AFB currently also includes several
noncontiguous properties: The two largest are the Harmon
Annex, which cover 2.8 square miles and is located along the
west side of the Island about 4 miles south of Northwest
Field; and Andy South, which includes the Andersen South
housing area and dormitories, covers 3.8 square miles, and is
located about 8 miles south of the Main Base. The water
system at Andersen AFB is currently owned, operated, and
maintained by the Air Force. Andersen AFB wells satisfy the
base's total water requirements. Andersen's water utility
system includes 9 ground water wells (identified as Tumon
Maui Well and Wells # 1, 2, 3, 5, 6, 7, 8, and 9),
chlorination and fluoridation equipment, air strippers,
several ground level storage tanks, several booster pump
stations, approximately 481,000 linear feet of piping ranging
in size from less than 2-inches to 30-inches in diameter, 353
building services, 48 air relief valves, 717 main valves, 11
post indicator valves, 439 fire hydrants, and 13 meters.
Andersen AFB's nine wells (and associated system
components) are located several miles off the Main Base.
There is one well at ``Tumon'' (900 gallons per minute (gpm))
and eight wells at the ``Andy South'' area (149-440 gpm each,
2090 gpm total). The water is pumped from the wells to the
Main Base several miles away crossing non-federal properties.
The Air Force's Andy South property is in the process of
being declared excess property pursuant to the Federal
Property Act, but neither the water rights nor the wells are
part of that action.
A new water system needs to be built due to the advancing
age (35-50+ years) and corrosive environment that has
deteriorated the system components. The logistics involved in
performing the maintenance and repair work off-base make it
difficult for the mechanics to control the deterioration. As
a result, more pipes, valves and pumps are failing. In 1999,
the 16'' main to the base leaked at a rate of 200-250 gallons
per minute and was repaired under pressure. The tank
isolation valves are so old they are not used because of fear
the valves might break. A major failure to the transmission
line or the 50+ year old Santa Rosa Tank could leave the Main
Base with only 250,000 gallons of available water (less than
15% of the average daily demand.) This amount is insufficient
for fire protection and normal operations.
The base estimates it costs about $800,000 per year for
electricity just to produce and transmit water to the Main
Base from the off-base wells. Savings of 20-40% are expected
if wells on the Main Base or the contiguous Northwest Field
are constructed.
Anti-Terrorism and Force Protection would improve if wells
were located on the Main Base or Northwest Field. Well House
No. 3 already experienced a break-in and theft of electrical
parts. Furthermore, there is no control over groundwater
contamination from non-Air Force sources. The Tumon Maui well
and Well No. 2 are currently not in operation due to
groundwater contamination. Current requirements are about 55
million gallons per month. In the past two years, Andersen
used up to 100 million gallons per month.
[[Page S7247]]
This provision further will provide an opportunity to meet
long term water needs with no USAF capital investment, reduce
short range modernization/rehabilitation costs for the aged
and reconfigured off-base water supply system (Tumon Maui
well and Wells 1-3 were originally built to support off-base
sites, for example the old Andy South), eliminate the need to
retain real property in Andy South, greatly enhance force
protection needs for vital water resources, and increase
system reliability and redundancy. Guam is chronically short
of potable water supplies. The water from Andy South and
Andersen Water Supply Annex, if available for commercial
sale, would be of substantial value. The Air Force believes
that value would be more than sufficient to pay the cost of
installation of a new series of wells on Andersen AFB, either
the Main Base or Northwest Field, and repair the existing
system on the base.
Section 927 would repeal the requirement for a separate
budget request for procurement of reserve equipment by
repealing section 114(e) of title 10, United States Code.
Section 928 would repeal the requirement for a two-year
budget cycle for the department of defense by repealing
section 1405 of the department of defense authorization act,
1986 (31 U.S.C. 1105 note).
______
By Mr. SMITH of Oregon:
S. 1156. A bill to amend the Consumer Product Safety Act to provide
that low-speed electric bicycles are consumer products subject to such
Act; to the Committee on Commerce, Science, and Transportation.
Mr. SMITH of Oregon. Mr. President, today I rise to introduce the
Electric Bike Safety Act of 2001. This bill will encourage and provide
more opportunities for Americans to enjoy the leisure and healthful
benefits of riding bicycles. This legislation would amend the Consumer
Product Safety Act CPSA, to provide that low-speed electric bicycles
are consumer products subject to such Act. As the CPSA is now written,
low-speed electric bicycles are not considered consumer products, but
rather a motorized vehicle subject to all regulations set by the
National Transportation Safety Administration, NTSA, which regulates
automobiles and motorcycles.
As a result of low-speed electric bicycles being treated as
motorcycles, they are required to meet burdensome and unnecessary
standards, making low-speed electric bicycles much more costly than
they need to be. Subjecting electric bicycles to motor vehicle
requirements would mean the addition of a large array of costly and
unnecessary equipment, brake lights, turn signals, automotive grade
headlights, and rearview mirrors.
Making electric bicycles accessible for more Americans will benefit
the lives of thousands of Americans. Electric bicycles provide disabled
riders the freedom of mobility without the cost or stigma of an
electric wheelchair. Electric bicycles provide older riders with
increased lifestyle flexibility due to increased mobility that electric
bicycles allow them. Electric bicycles provide law enforcement officers
a practical way to patrol neighborhoods and towns in a manner
consistent with the highly successful emphasis on ``Community
Policing''. Electric bicycles provide short and medium distance
commuters an environmentally friendly and healthy way to get to work.
In short, this bill is pro-Americans with disabilities, pro-elderly,
pro-safety, and pro-environment. Electric bicycles will prove
beneficial to many more Americans if we in Congress do our part to make
electric bicycles affordable.
In my home State of Oregon, there are thousands of people who ride
bicycles each day, whether as a means of transportation, exercise, or
recreation. The City of Corvallis, OR, has 63 miles of bike lanes and
paths and as a result has a very high number of people who commute to
work on their bicycles. Area companies such as Hewlett-Packard and
CH2M-Hill even offer changing areas and showers as a way to encourage
their employees to ride bicycles to work. The Corvallis Police
Department is also able to utilize electric bikes as a community
friendly way to patrol the city.
I believe that placing electric bicycles under the regulation of the
Consumer Product Safety Commission will be only ensure the safety of
electric bicycles, but will promote their use by making electric
bicycles an affordable alternative form of transportation to millions
of Americans.
______
By Mr. SPECTER (for himself, Ms. Landrieu, Ms. Collins, Mr.
Schumer, Ms. Snowe, Mr. Leahy, Mr. Cochran, Mr. Breaux, Mr.
Allen, Mr. Biden, Mr. Bond, Mrs. Carnahan, Mr. Carper, Mr.
Chafee, Mr. Cleland, Mrs. Clinton, Mr. Dodd, Mr. Edwards, Mr.
Frist, Mr. Gregg, Mr. Helms, Mr. Hollings, Mr. Jeffords, Mr.
Kennedy, Mr. Kerry, Mr. Lieberman, Mrs. Lincoln, Ms. Mikulski,
Mr. Miller, Mr. Reed, Mr. Rockefeller, Mr. Sarbanes, Mr.
Sessions, Mr. Shelby, Mr. Smith of New Hampshire, Mr. Thompson,
Mr. Thurmond, Mr. Torricelli, and Mr. Warner):
S. 1157. A bill to reauthorize the consent of Congress to the
Northeast Interstate Dairy Compact and to grant the consent of Congress
to the Southern Dairy Compact, a Pacific Northwest Dairy Compact, and
an Intermountain Dairy Compact; to the Committee on the Judiciary.
Mr. SPECTER. Mr. President, I join today with thirty-eight of my
colleagues to introduce legislation authorizing interstate dairy
compacts. Members of the U.S. House of Representatives have introduced
similar legislation with 162 cosponsors, including 17 members of the
Pennsylvania delegation.
This legislation will create a much needed safety net for dairy
farmers in the Northeast and other regions and will bring greater
stability to the prices paid to farmers. The bill authorizes an
Interstate Compact Commission to take such steps as necessary to assure
consumers of an adequate local supply of fresh fluid milk and to assure
the continued viability of dairy farming within the compact region.
Specifically, states that choose to join a compact would enter into a
voluntary agreement to create a minimum farm-price for milk within the
compact region to form a safety net for dairy farmers when farm milk
prices fall below the established compact price. This price would take
into account the regional differences in the costs of production for
milk, thereby providing dairy farmers with a fair and equitable price
for their product.
Specifically, the bill would authorize Pennsylvania, New Jersey,
Delaware, New York, Maryland, and Ohio to join the existing Northeast
Interstate Dairy Compact, which has been in operation since July 1997.
Most of these States have already agreed to join the Compact with
strong support from their governors and legislatures. In the
Commonwealth of Pennsylvania, Governor Ridge has been a very strong
supporter and advocate of the Compact. The Pennsylvania Senate and
House of Representatives have sent a clear signal to Congress by voting
with overwhelming majorities of 44 to 6 and 181 to 20, respectively, to
authorize the Commonwealth's participation in the Northeast Dairy
Compact.
In addition to expanding the current Northeast Interstate Dairy
Compact, the bill would authorize southern States to form a similar
compact to provide price stability in their region. I am pleased to
join so many of my colleagues from the South in introducing this
legislation. Finally, the legislation would allow formation of other
compacts in the Pacific Northwest and Intermountain region within three
years. We have included language in this bill to recognize the efforts
in these States to support dairy compacts and to avoid their exclusion
if these efforts lead to passage of compact legislation by their State
governments.
In total, twenty-five States have already approved dairy compact
legislation. This is a broad mandate from States that are attempting to
meet the needs of dairy farmers, producers, consumers and other
citizens concerned with the future of their milk supply. These States
recognize the many positive aspects of dairy compacts. The benefits
include providing dairy farmers with a fairer and more stable price
structure; providing consumers with price stability and a steady,
reliable source of local milk for their consumption; enhancement of
conservation efforts in areas threatened by sprawl; and maintenance of
rural economies that have been suffering for quite some time from the
loss of income-generating farmers.
Over the past several years, I have worked closely with my colleagues
in the Senate in order to provide a more equitable price for our
nation's milk
[[Page S7248]]
producers. I supported amendments to the Farm Bills of 1981 and 1985,
the Emergency Supplemental Appropriations Bill of 1991, the Budget
Resolution of 1995 and the most recent Farm Bill in 1996 in an effort
to insure that dairy farmers receive a fair price. As a member of the
U.S. Senate Agriculture Appropriations Subcommittee, I have worked to
ensure that dairy programs have received the maximum possible funding,
including high quality dairy research conducted at Penn State
University. I have also been a leading supporter of the Dairy Export
Incentive Program which facilitates the development of an international
market for United States dairy products.
In recent years, however, dairy farmers have faced low prices for
dairy products. Prices have fluctuated greatly over the past several
years, thereby making any long-term planning impossible for farmers.
These economic conditions have placed our Nation's dairy farmers in an
all but impossible position and this is borne out in dairy farmers'
declining ranks.
Our Nation's farmers are some of the hardest working and most
dedicated individuals in America. During my tenure as a United States
Senator, I have visited numerous small dairy farms in Pennsylvania. I
have seen these hard working men and women who have dedicated their
lives to their farms. The downward trend in dairy prices is an issue
that directly affects all of us. We have a duty to ensure that our
Nation's dairy farmers receive a fair price for their milk. If we do
nothing, many small dairy farmers will be forced to sell their farms
and leave the agriculture industry. This will not only impact the lives
of these farmers, but will also have a significant negative impact on
the rural economies that depend on the dairy industry for support.
Further, the large-scale departure of small dairy farmers from
agriculture could place our nation's steady supply of fresh fluid milk
in jeopardy, thereby affecting every American.
We must recognize the importance of this problem and take prompt
action. Twenty-five States have asked us to pass this legislation and
provide a necessary tool for their dairy farmers. I urge my colleagues
to cosponsor and support this legislation as we continue to work in
Congress to bring greater stability to our Nation's dairy industry.
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. 1157
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 ``Dairy Consumers and
Producers Protection Act of 2001''.
SEC. 2. NORTHEAST INTERSTATE DAIRY COMPACT.
Section 147 of the Agricultural Market Transition Act (7
U.S.C. 7256) is amended--
(1) in the matter preceding paragraph (1), by striking
``States'' and all that follows through ``Vermont'' and
inserting ``States of Connecticut, Delaware, Maine, Maryland,
Massachusetts, New Hampshire, New Jersey, New York,
Pennsylvania, Rhode Island, and Vermont'';
(2) by striking paragraphs (1), (3), and (7);
(3) in paragraph (2), by striking ``Class III-A'' and
inserting ``Class IV'';
(4) by striking paragraph (4) and inserting the following:
``(4) Additional state.--Ohio is the only additional State
that may join the Northeast Interstate Dairy Compact.'';
(5) in paragraph (5), by striking ``the projected rate of
increase'' and all that follows through ``Secretary'' and
inserting ``the operation of the Compact price regulation
during the fiscal year, as determined by the Secretary (in
consultation with the Commission) using notice and comment
procedures provided in section 553 of title 5, United States
Code''; and
(6) by redesignating paragraphs (2), (4), (5), and (6) as
paragraphs (1), (2), (3), and (4), respectively.
SEC. 3. SOUTHERN DAIRY COMPACT.
(a) In General.--Congress consents to the Southern Dairy
Compact entered into among the States of Alabama, Arkansas,
Georgia, Kansas, Kentucky, Louisiana, Mississippi, Missouri,
North Carolina, Oklahoma, South Carolina, Tennessee,
Virginia, and West Virginia, subject to the following
conditions:
(1) Limitation of manufacturing price regulation.--The
Southern Dairy Compact Commission may not regulate Class II,
Class III, or Class IV milk used for manufacturing purposes
or any other milk, other than Class I, or fluid milk, as
defined by a Federal milk marketing order issued under
section 8c of the Agricultural Adjustment Act (7 U.S.C.
608c), reenacted with amendments by the Agricultural
Marketing Act of 1937 (referred to in this section as a
``Federal milk marketing order'') unless Congress has first
consented to and approved such authority by a law enacted
after the date of enactment of this joint resolution.
(2) Additional states.--Florida, Nebraska, and Texas are
the only additional States that may join the Southern Dairy
Compact, individually or otherwise.
(3) Compensation of commodity credit corporation.--Before
the end of each fiscal year in which a Compact price
regulation is in effect, the Southern Dairy Compact
Commission shall compensate the Commodity Credit Corporation
for the cost of any purchases of milk and milk products by
the Corporation that result from the operation of the Compact
price regulation during the fiscal year, as determined by the
Secretary (in consultation with the Commission) using notice
and comment procedures provided in section 553 of title 5,
United States Code.
(4) Milk marketing order administrator.--At the request of
the Southern Dairy Compact Commission, the Administrator of
the applicable Federal milk marketing order shall provide
technical assistance to the Compact Commission and be
compensated for that assistance.
(b) Compact.--The Southern Dairy Compact is substantially
as follows:
``ARTICLE I. STATEMENT OF PURPOSE, FINDINGS AND DECLARATION OF POLICY
``Sec. 1. Statement of purpose, findings and declaration of
policy
``The purpose of this compact is to recognize the
interstate character of the southern dairy industry and the
prerogative of the states under the United States
Constitution to form an interstate commission for the
southern region. The mission of the commission is to take
such steps as are necessary to assure the continued viability
of dairy farming in the south, and to assure consumers of an
adequate, local supply of pure and wholesome milk.
``The participating states find and declare that the dairy
industry is an essential agricultural activity of the south.
Dairy farms, and associated suppliers, marketers, processors
and retailers are an integral component of the region's
economy. Their ability to provide a stable, local supply of
pure, wholesome milk is a matter of great importance to the
health and welfare of the region.
``The participating states further find that dairy farms
are essential and they are an integral part of the region's
rural communities. The farms preserve land for agricultural
purposes and provide needed economic stimuli for rural
communities.
``In establishing their constitutional regulatory authority
over the region's fluid milk market by this compact, the
participating states declare their purpose that this compact
neither displace the federal order system nor encourage the
merging of federal orders. Specific provisions of the compact
itself set forth this basic principle.
``Designed as a flexible mechanism able to adjust to
changes in a regulated marketplace, the compact also contains
a contingency provision should the federal order system be
discontinued. In that event, the interstate commission is
authorized to regulate the marketplace in replacement of the
order system. This contingent authority does not anticipate
such a change, however, and should not be so construed. It is
only provided should developments in the market other than
establishment of this compact result in discontinuance of the
order system.
``By entering into this compact, the participating states
affirm that their ability to regulate the price which
southern dairy farmers receive for their product is essential
to the public interest. Assurance of a fair and equitable
price for dairy farmers ensures their ability to provide milk
to the market and the vitality of the southern dairy
industry, with all the associated benefits.
``Recent, dramatic price fluctuations, with a pronounced
downward trend, threaten the viability and stability of the
southern dairy region. Historically, individual state
regulatory action had been an effective emergency remedy
available to farmers confronting a distressed market. The
federal order system, implemented by the Agricultural
Marketing Agreement Act of 1937, establishes only minimum
prices paid to producers for raw milk, without preempting the
power of states to regulate milk prices above the minimum
levels so established.
``In today's regional dairy marketplace, cooperative,
rather than individual state action is needed to more
effectively address the market disarray. Under our
constitutional system, properly authorized states acting
cooperatively may exercise more power to regulate interstate
commerce than they may assert individually without such
authority. For this reason, the participating states invoke
their authority to act in common agreement, with the consent
of Congress, under the compact clause of the Constitution.
``ARTICLE II. DEFINITIONS AND RULES OF CONSTRUCTION
``Sec. 2. Definitions
``For the purposes of this compact, and of any supplemental
or concurring legislation enacted pursuant thereto, except as
may be otherwise required by the context:
``(1) `Class I milk' means milk disposed of in fluid form
or as a fluid milk product, subject to further definition in
accordance with
[[Page S7249]]
the principles expressed in subdivision (b) of section three.
``(2) `Commission' means the Southern Dairy Compact
Commission established by this compact.
``(3) `Commission marketing order' means regulations
adopted by the commission pursuant to sections nine and ten
of this compact in place of a terminated federal marketing
order or state dairy regulation. Such order may apply
throughout the region or in any part or parts thereof as
defined in the regulations of the commission. Such order may
establish minimum prices for any or all classes of milk.
``(4) `Compact' means this interstate compact.
``(5) `Compact over-order price' means a minimum price
required to be paid to producers for Class I milk established
by the commission in regulations adopted pursuant to sections
nine and ten of this compact, which is above the price
established in federal marketing orders or by state farm
price regulations in the regulated area. Such price may apply
throughout the region or in any part or parts thereof as
defined in the regulations of the commission.
``(6) `Milk' means the lacteral secretion of cows and
includes all skim, butterfat, or other constituents obtained
from separation or any other process. The term is used in its
broadest sense and may be further defined by the commission
for regulatory purposes.
``(7) `Partially regulated plant' means a milk plant not
located in a regulated area but having Class I distribution
within such area. Commission regulations may exempt plants
having such distribution or receipts in amounts less than the
limits defined therein.
``(8) `Participating state' means a state which has become
a party to this compact by the enactment of concurring
legislation.
``(9) `Pool plant' means any milk plant located in a
regulated area.
``(10) `Region' means the territorial limits of the states
which are parties to this compact.
``(11) `Regulated area' means any area within the region
governed by and defined in regulations establishing a compact
over-order price or commission marketing order.
``(12) `State dairy regulation' means any state regulation
of dairy prices, and associated assessments, whether by
statute, marketing order or otherwise.
``Sec. 3. Rules of construction
``(a) This compact shall not be construed to displace
existing federal milk marketing orders or state dairy
regulation in the region but to supplement them. In the event
some or all federal orders in the region are discontinued,
the compact shall be construed to provide the commission the
option to replace them with one or more commission marketing
orders pursuant to this compact.
``(b) The compact shall be construed liberally in order to
achieve the purposes and intent enunciated in section one. It
is the intent of this compact to establish a basic structure
by which the commission may achieve those purposes through
the application, adaptation and development of the regulatory
techniques historically associated with milk marketing and to
afford the commission broad flexibility to devise regulatory
mechanisms to achieve the purposes of this compact. In
accordance with this intent, the technical terms which are
associated with market order regulation and which have
acquired commonly understood general meanings are not defined
herein but the commission may further define the terms used
in this compact and develop additional concepts and define
additional terms as it may find appropriate to achieve its
purposes.
``ARTICLE III. COMMISSION ESTABLISHED
``Sec. 4. Commission established
``There is hereby created a commission to administer the
compact, composed of delegations from each state in the
region. The commission shall be known as the Southern Dairy
Compact Commission. A delegation shall include not less than
three nor more than five persons. Each delegation shall
include at least one dairy farmer who is engaged in the
production of milk at the time of appointment or
reappointment, and one consumer representative. Delegation
members shall be residents and voters of, and subject to such
confirmation process as is provided for in the appointing
state. Delegation members shall serve no more than three
consecutive terms with no single term of more than four
years, and be subject to removal for cause. In all other
respects, delegation members shall serve in accordance with
the laws of the state represented. The compensation, if any,
of the members of a state delegation shall be determined and
paid by each state, but their expenses shall be paid by the
commission.
``Sec. 5. Voting requirements
``All actions taken by the commission, except for the
establishment or termination of an over-order price or
commission marketing order, and the adoption, amendment or
rescission of the commission's by-laws, shall be by majority
vote of the delegations present. Each state delegation shall
be entitled to one vote in the conduct of the commission's
affairs. Establishment or termination of an over-order price
or commission marketing order shall require at least a two-
thirds vote of the delegations present. The establishment of
a regulated area which covers all or part of a participating
state shall require also the affirmative vote of that state's
delegation. A majority of the delegations from the
participating states shall constitute a quorum for the
conduct of the commission's business.
``Sec. 6. Administration and management
``(a) The commission shall elect annually from among the
members of the participating state delegations a chairperson,
a vice-chairperson, and a treasurer. The commission shall
appoint an executive director and fix his or her duties and
compensation. The executive director shall serve at the
pleasure of the commission, and together with the treasurer,
shall be bonded in an amount determined by the commission.
The commission may establish through its by-laws an executive
committee composed of one member elected by each delegation.
``(b) The commission shall adopt by-laws for the conduct of
its business by a two-thirds vote, and shall have the power
by the same vote to amend and rescind these by-laws. The
commission shall publish its by-laws in convenient form with
the appropriate agency or officer in each of the
participating states. The by-laws shall provide for
appropriate notice to the delegations of all commission
meetings and hearings and of the business to be transacted at
such meetings or hearings. Notice also shall be given to
other agencies or officers of participating states as
provided by the laws of those states.
``(c) The commission shall file an annual report with the
Secretary of Agriculture of the United States, and with each
of the participating states by submitting copies to the
governor, both houses of the legislature, and the head of the
state department having responsibilities for agriculture.
``(d) In addition to the powers and duties elsewhere
prescribed in this compact, the commission shall have the
power:
``(1) To sue and be sued in any state or federal court;
``(2) To have a seal and alter the same at pleasure;
``(3) To acquire, hold, and dispose of real and personal
property by gift, purchase, lease, license, or other similar
manner, for its corporate purposes;
``(4) To borrow money and issue notes, to provide for the
rights of the holders thereof and to pledge the revenue of
the commission as security therefor, subject to the
provisions of section eighteen of this compact;
``(5) To appoint such officers, agents, and employees as it
may deem necessary, prescribe their powers, duties and
qualifications; and
``(6) To create and abolish such offices, employments and
positions as it deems necessary for the purposes of the
compact and provide for the removal, term, tenure,
compensation, fringe benefits, pension, and retirement rights
of its officers and employees. The commission may also retain
personal services on a contract basis.
``Sec. 7. Rulemaking power
``In addition to the power to promulgate a compact over-
order price or commission marketing orders as provided by
this compact, the commission is further empowered to make and
enforce such additional rules and regulations as it deems
necessary to implement any provisions of this compact, or to
effectuate in any other respect the purposes of this compact.
``ARTICLE IV. POWERS OF THE COMMISSION
``Sec. 8. Powers to promote regulatory uniformity,
simplicity, and interstate cooperation
``The commission is hereby empowered to:
``(1) Investigate or provide for investigations or research
projects designed to review the existing laws and regulations
of the participating states, to consider their administration
and costs, to measure their impact on the production and
marketing of milk and their effects on the shipment of milk
and milk products within the region.
``(2) Study and recommend to the participating states joint
or cooperative programs for the administration of the dairy
marketing laws and regulations and to prepare estimates of
cost savings and benefits of such programs.
``(3) Encourage the harmonious relationships between the
various elements in the industry for the solution of their
material problems. Conduct symposia or conferences designed
to improve industry relations, or a better understanding of
problems.
``(4) Prepare and release periodic reports on activities
and results of the commission's efforts to the participating
states.
``(5) Review the existing marketing system for milk and
milk products and recommend changes in the existing structure
for assembly and distribution of milk which may assist,
improve or promote more efficient assembly and distribution
of milk.
``(6) Investigate costs and charges for producing, hauling,
handling, processing, distributing, selling and for all other
services performed with respect to milk.
``(7) Examine current economic forces affecting producers,
probable trends in production and consumption, the level of
dairy farm prices in relation to costs, the financial
conditions of dairy farmers, and the need for an emergency
order to relieve critical conditions on dairy farms.
``Sec. 9. Equitable farm prices
``(a) The powers granted in this section and section ten
shall apply only to the establishment of a compact over-order
price, so long as federal milk marketing orders remain in
effect in the region. In the event that any or all such
orders are terminated, this article
[[Page S7250]]
shall authorize the commission to establish one or more
commission marketing orders, as herein provided, in the
region or parts thereof as defined in the order.
``(b) A compact over-order price established pursuant to
this section shall apply only to Class I milk. Such compact
over-order price shall not exceed one dollar and fifty cents
per gallon at Atlanta, Ga., however, this compact over-order
price shall be adjusted upward or downward at other locations
in the region to reflect differences in minimum federal order
prices. Beginning in nineteen hundred ninety, and using that
year as a base, the foregoing one dollar fifty cents per
gallon maximum shall be adjusted annually by the rate of
change in the Consumer Price Index as reported by the Bureau
of Labor Statistics of the United States Department of Labor.
For purposes of the pooling and equalization of an over-order
price, the value of milk used in other use classifications
shall be calculated at the appropriate class price
established pursuant to the applicable federal order or state
dairy regulation and the value of unregulated milk shall be
calculated in relation to the nearest prevailing class price
in accordance with and subject to such adjustments as the
commission may prescribe in regulations.
``(c) A commission marketing order shall apply to all
classes and uses of milk.
``(d) The commission is hereby empowered to establish a
compact over-order price for milk to be paid by pool plants
and partially regulated plants. The commission is also
empowered to establish a compact over-order price to be paid
by all other handlers receiving milk from producers located
in a regulated area. This price shall be established either
as a compact over-order price or by one or more commission
marketing orders. Whenever such a price has been established
by either type of regulation, the legal obligation to pay
such price shall be determined solely by the terms and
purpose of the regulation without regard to the situs of the
transfer of title, possession or any other factors not
related to the purposes of the regulation and this compact.
Producer-handlers as defined in an applicable federal market
order shall not be subject to a compact over-order price. The
commission shall provide for similar treatment of producer-
handlers under commission marketing orders.
``(e) In determining the price, the commission shall
consider the balance between production and consumption of
milk and milk products in the regulated area, the costs of
production including, but not limited to the price of feed,
the cost of labor including the reasonable value of the
producer's own labor and management, machinery expense, and
interest expense, the prevailing price for milk outside the
regulated area, the purchasing power of the public and the
price necessary to yield a reasonable return to the producer
and distributor.
``(f) When establishing a compact over-order price, the
commission shall take such other action as is necessary and
feasible to help ensure that the over-order price does not
cause or compensate producers so as to generate local
production of milk in excess of those quantities necessary to
assure consumers of an adequate supply for fluid purposes.
``(g) The commission shall whenever possible enter into
agreements with state or federal agencies for exchange of
information or services for the purpose of reducing
regulatory burden and cost of administering the compact. The
commission may reimburse other agencies for the reasonable
cost of providing these services.
``Sec. 10. Optional provisions for pricing order
``Regulations establishing a compact over-order price or a
commission marketing order may contain, but shall not be
limited to any of the following:
``(1) Provisions classifying milk in accordance with the
form in which or purpose for which it is used, or creating a
flat pricing program.
``(2) With respect to a commission marketing order only,
provisions establishing or providing a method for
establishing separate minimum prices for each use
classification prescribed by the commission, or a single
minimum price for milk purchased from producers or
associations of producers.
``(3) With respect to an over-order minimum price,
provisions establishing or providing a method for
establishing such minimum price for Class I milk.
``(4) Provisions for establishing either an over-order
price or a commission marketing order may make use of any
reasonable method for establishing such price or prices
including flat pricing and formula pricing. Provision may
also be made for location adjustments, zone differentials and
for competitive credits with respect to regulated handlers
who market outside the regulated area.
``(5) Provisions for the payment to all producers and
associations of producers delivering milk to all handlers of
uniform prices for all milk so delivered, irrespective of the
uses made of such milk by the individual handler to whom it
is delivered, or for the payment of producers delivering milk
to the same handler of uniform prices for all milk delivered
by them.
``(A) With respect to regulations establishing a compact
over-order price, the commission may establish one
equalization pool within the regulated area for the sole
purpose of equalizing returns to producers throughout the
regulated area.
``(B) With respect to any commission marketing order, as
defined in section two, subdivision three, which replaces one
or more terminated federal orders or state dairy regulations,
the marketing area of now separate state or federal orders
shall not be merged without the affirmative consent of each
state, voting through its delegation, which is partly or
wholly included within any such new marketing area.
``(6) Provisions requiring persons who bring Class I milk
into the regulated area to make compensatory payments with
respect to all such milk to the extent necessary to equalize
the cost of milk purchased by handlers subject to a compact
over-order price or commission marketing order. No such
provisions shall discriminate against milk producers outside
the regulated area. The provisions for compensatory payments
may require payment of the difference between the Class I
price required to be paid for such milk in the state of
production by a federal milk marketing order or state dairy
regulation and the Class I price established by the compact
over-order price or commission marketing order.
``(7) Provisions specially governing the pricing and
pooling of milk handled by partially regulated plants.
``(8) Provisions requiring that the account of any person
regulated under the compact over-order price shall be
adjusted for any payments made to or received by such persons
with respect to a producer settlement fund of any federal or
state milk marketing order or other state dairy regulation
within the regulated area.
``(9) Provision requiring the payment by handlers of an
assessment to cover the costs of the administration and
enforcement of such order pursuant to Article VII, Section
18(a).
``(10) Provisions for reimbursement to participants of the
Women, Infants and Children Special Supplemental Food Program
of the United States Child Nutrition Act of 1966.
``(11) Other provisions and requirements as the commission
may find are necessary or appropriate to effectuate the
purposes of this compact and to provide for the payment of
fair and equitable minimum prices to producers.
``ARTICLE V. RULEMAKING PROCEDURE
``Sec. 11. Rulemaking procedure
``Before promulgation of any regulations establishing a
compact over-order price or commission marketing order,
including any provision with respect to milk supply under
subsection 9(f), or amendment thereof, as provided in Article
IV, the commission shall conduct an informal rulemaking
proceeding to provide interested persons with an opportunity
to present data and views. Such rulemaking proceeding shall
be governed by section four of the Federal Administrative
Procedure Act, as amended (5 U.S.C. Sec. 553). In addition,
the commission shall, to the extent practicable, publish
notice of rulemaking proceedings in the official register of
each participating state. Before the initial adoption of
regulations establishing a compact over-order price or a
commission marketing order and thereafter before any
amendment with regard to prices or assessments, the
commission shall hold a public hearing. The commission may
commence a rulemaking proceeding on its own initiative or may
in its sole discretion act upon the petition of any person
including individual milk producers, any organization of milk
producers or handlers, general farm organizations, consumer
or public interest groups, and local, state or federal
officials.
``Sec. 12. Findings and referendum
``(a) In addition to the concise general statement of basis
and purpose required by section 4(b) of the Federal
Administrative Procedure Act, as amended (5 U.S.C.
Sec. 553(c)), the commission shall make findings of fact with
respect to:
``(1) Whether the public interest will be served by the
establishment of minimum milk prices to dairy farmers under
Article IV.
``(2) What level of prices will assure that producers
receive a price sufficient to cover their costs of production
and will elicit an adequate supply of milk for the
inhabitants of the regulated area and for manufacturing
purposes.
``(3) Whether the major provisions of the order, other than
those fixing minimum milk prices, are in the public interest
and are reasonably designed to achieve the purposes of the
order.
``(4) Whether the terms of the proposed regional order or
amendment are approved by producers as provided in section
thirteen.
``Sec. 13. Producer referendum
``(a) For the purpose of ascertaining whether the issuance
or amendment of regulations establishing a compact over-order
price or a commission marketing order, including any
provision with respect to milk supply under subsection 9(f),
is approved by producers, the commission shall conduct a
referendum among producers. The referendum shall be held in a
timely manner, as determined by regulation of the commission.
The terms and conditions of the proposed order or amendment
shall be described by the commission in the ballot used in
the conduct of the referendum, but the nature, content, or
extent of such description shall not be a basis for attacking
the legality of the order or any action relating thereto.
``(b) An order or amendment shall be deemed approved by
producers if the commission determines that it is approved by
at least two-thirds of the voting producers who,
[[Page S7251]]
during a representative period determined by the commission,
have been engaged in the production of milk the price of
which would be regulated under the proposed order or
amendment.
``(c) For purposes of any referendum, the commission shall
consider the approval or disapproval by any cooperative
association of producers, qualified under the provisions of
the Act of Congress of February 18, 1922, as amended, known
as the Capper-Volstead Act, bona fide engaged in marketing
milk, or in rendering services for or advancing the interests
of producers of such commodity, as the approval or
disapproval of the producers who are members or stockholders
in, or under contract with, such cooperative association of
producers, except as provided in subdivision (1) hereof and
subject to the provisions of subdivision (2) through (5)
hereof.
``(1) No cooperative which has been formed to act as a
common marketing agency for both cooperatives and individual
producers shall be qualified to block vote for either.
``(2) Any cooperative which is qualified to block vote
shall, before submitting its approval or disapproval in any
referendum, give prior written notice to each of its members
as to whether and how it intends to cast its vote. The notice
shall be given in a timely manner as established, and in the
form prescribed, by the commission.
``(3) Any producer may obtain a ballot from the commission
in order to register approval or disapproval of the proposed
order.
``(4) A producer who is a member of a cooperative which has
provided notice of its intent to approve or not to approve a
proposed order, and who obtains a ballot and with such ballot
expresses his approval or disapproval of the proposed order,
shall notify the commission as to the name of the cooperative
of which he or she is a member, and the commission shall
remove such producer's name from the list certified by such
cooperative with its corporate vote.
``(5) In order to insure that all milk producers are
informed regarding the proposed order, the commission shall
notify all milk producers that an order is being considered
and that each producer may register his approval or
disapproval with the commission either directly or through
his or her cooperative.
``Sec. 14. Termination of over-order price or marketing order
``(a) The commission shall terminate any regulations
establishing an over-order price or commission marketing
order issued under this article whenever it finds that such
order or price obstructs or does not tend to effectuate the
declared policy of this compact.
``(b) The commission shall terminate any regulations
establishing an over-order price or a commission marketing
order issued under this article whenever it finds that such
termination is favored by a majority of the producers who,
during a representative period determined by the commission,
have been engaged in the production of milk the price of
which is regulated by such order; but such termination shall
be effective only if announced on or before such date as may
be specified in such marketing agreement or order.
``(c) The termination or suspension of any order or
provision thereof, shall not be considered an order within
the meaning of this article and shall require no hearing, but
shall comply with the requirements for informal rulemaking
prescribed by section four of the Federal Administrative
Procedure Act, as amended (5 U.S.C. Sec. 553).
``ARTICLE VI. ENFORCEMENT
``Sec. 15. Records; reports; access to premises
``(a) The commission may by rule and regulation prescribe
record keeping and reporting requirements for all regulated
persons. For purposes of the administration and enforcement
of this compact, the commission is authorized to examine the
books and records of any regulated person relating to his or
her milk business and for that purpose, the commission's
properly designated officers, employees, or agents shall have
full access during normal business hours to the premises and
records of all regulated persons.
``(b) Information furnished to or acquired by the
commission officers, employees, or its agents pursuant to
this section shall be confidential and not subject to
disclosure except to the extent that the commission deems
disclosure to be necessary in any administrative or judicial
proceeding involving the administration or enforcement of
this compact, an over-order price, a compact marketing order,
or other regulations of the commission. The commission may
promulgate regulations further defining the confidentiality
of information pursuant to this section. Nothing in this
section shall be deemed to prohibit (i) the issuance of
general statements based upon the reports of a number of
handlers, which do not identify the information furnished by
any person, or (ii) the publication by direction of the
commission of the name of any person violating any regulation
of the commission, together with a statement of the
particular provisions violated by such person.
``(c) No officer, employee, or agent of the commission
shall intentionally disclose information, by inference or
otherwise, which is made confidential pursuant to this
section. Any person violating the provisions of this section
shall, upon conviction, be subject to a fine of not more than
one thousand dollars or to imprisonment for not more than one
year, or to both, and shall be removed from office. The
commission shall refer any allegation of a violation of this
section to the appropriate state enforcement authority or
United States Attorney.
``Sec. 16. Subpoena; hearings and judicial review
``(a) The commission is hereby authorized and empowered by
its members and its properly designated officers to
administer oaths and issue subpoenas throughout all signatory
states to compel the attendance of witnesses and the giving
of testimony and the production of other evidence.
``(b) Any handler subject to an order may file a written
petition with the commission stating that any such order or
any provision of any such order or any obligation imposed in
connection therewith is not in accordance with law and
praying for a modification thereof or to be exempted
therefrom. He shall thereupon be given an opportunity for a
hearing upon such petition, in accordance with regulations
made by the commission. After such hearing, the commission
shall make a ruling upon the prayer of such petition which
shall be final, if in accordance with law.
``(c) The district courts of the United States in any
district in which such handler is an inhabitant, or has his
principal place of business, are hereby vested with
jurisdiction to review such ruling, provided a complaint for
that purpose is filed within thirty days from the date of the
entry of such ruling. Service of process in such proceedings
may be had upon the commission by delivering to it a copy of
the complaint. If the court determines that such ruling is
not in accordance with law, it shall remand such proceedings
to the commission with directions either (1) to make such
ruling as the court shall determine to be in accordance with
law, or (2) to take such further proceedings as, in its
opinion, the law requires. The pendency of proceedings
instituted pursuant to this subdivision shall not impede,
hinder, or delay the commission from obtaining relief
pursuant to section seventeen. Any proceedings brought
pursuant to section seventeen, except where brought by way of
counterclaim in proceedings instituted pursuant to this
section, shall abate whenever a final decree has been
rendered in proceedings between the same parties, and
covering the same subject matter, instituted pursuant to this
section.
``Sec. 17. Enforcement with respect to handlers
``(a) Any violation by a handler of the provisions of
regulations establishing an over-order price or a commission
marketing order, or other regulations adopted pursuant to
this compact shall:
``(1) Constitute a violation of the laws of each of the
signatory states. Such violation shall render the violator
subject to a civil penalty in an amount as may be prescribed
by the laws of each of the participating states, recoverable
in any state or federal court of competent jurisdiction. Each
day such violation continues shall constitute a separate
violation.
``(2) Constitute grounds for the revocation of license or
permit to engage in the milk business under the applicable
laws of the participating states.
``(b) With respect to handlers, the commission shall
enforce the provisions of this compact, regulations
establishing an over-order price, a commission marketing
order or other regulations adopted hereunder by:
``(1) Commencing an action for legal or equitable relief
brought in the name of the commission of any state or federal
court of competent jurisdiction; or
``(2) Referral to the state agency for enforcement by
judicial or administrative remedy with the agreement of the
appropriate state agency of a participating state.
``(c) With respect to handlers, the commission may bring an
action for injunction to enforce the provisions of this
compact or the order or regulations adopted thereunder
without being compelled to allege or prove that an adequate
remedy of law does not exist.
``ARTICLE VII. FINANCE
``Sec. 18. Finance of start-up and regular costs
``(a) To provide for its start-up costs, the commission may
borrow money pursuant to its general power under section six,
subdivision (d), paragraph four. In order to finance the
costs of administration and enforcement of this compact,
including payback of start-up costs, the commission is hereby
empowered to collect an assessment from each handler who
purchases milk from producers within the region. If
imposed, this assessment shall be collected on a monthly
basis for up to one year from the date the commission
convenes, in an amount not to exceed $.015 per
hundredweight of milk purchased from producers during the
period of the assessment. The initial assessment may apply
to the projected purchases of handlers for the two-month
period following the date the commission convenes. In
addition, if regulations establishing an over-order price
or a compact marketing order are adopted, they may include
an assessment for the specific purpose of their
administration. These regulations shall provide for
establishment of a reserve for the commission's ongoing
operating expenses.
``(b) The commission shall not pledge the credit of any
participating state or of the United States. Notes issued by
the commission and all other financial obligations incurred
by it, shall be its sole responsibility and no participating
state or the United States shall be liable therefor.
[[Page S7252]]
``Sec. 19. Audit and accounts
``(a) The commission shall keep accurate accounts of all
receipts and disbursements, which shall be subject to the
audit and accounting procedures established under its rules.
In addition, all receipts and disbursements of funds handled
by the commission shall be audited yearly by a qualified
public accountant and the report of the audit shall be
included in and become part of the annual report of the
commission.
``(b) The accounts of the commission shall be open at any
reasonable time for inspection by duly constituted officers
of the participating states and by any persons authorized by
the commission.
``(c) Nothing contained in this article shall be construed
to prevent commission compliance with laws relating to audit
or inspection of accounts by or on behalf of any
participating state or of the United States.
``ARTICLE VIII. ENTRY INTO FORCE; ADDITIONAL MEMBERS AND WITHDRAWAL
``Sec. 20. Entry into force; additional members
``The compact shall enter into force effective when enacted
into law by any three states of the group of states composed
of Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana,
Maryland, Mississippi, North Carolina, Oklahoma, South
Carolina, Tennessee, Texas, Virginia and West Virginia and
when the consent of Congress has been obtained.
``Sec. 21. Withdrawal from compact
``Any participating state may withdraw from this compact by
enacting a statute repealing the same, but no such withdrawal
shall take effect until one year after notice in writing of
the withdrawal is given to the commission and the governors
of all other participating states. No withdrawal shall affect
any liability already incurred by or chargeable to a
participating state prior to the time of such withdrawal.
``Sec. 22. Severability
``If any part or provision of this compact is adjudged
invalid by any court, such judgment shall be confined in its
operation to the part or provision directly involved in the
controversy in which such judgment shall have been rendered
and shall not affect or impair the validity of the remainder
of this compact. In the event Congress consents to this
compact subject to conditions, said conditions shall not
impair the validity of this compact when said conditions are
accepted by three or more compacting states. A compacting
state may accept the conditions of Congress by implementation
of this compact.''.
SEC. 4. PACIFIC NORTHWEST DAIRY COMPACT.
Congress consents to a Pacific Northwest Dairy Compact
proposed for the States of California, Oregon, and
Washington, subject to the following conditions:
(1) Text.--The text of the Pacific Northwest Dairy Compact
shall be identical to the text of the Southern Dairy Compact,
except as follows:
(A) References to ``south'', ``southern'', and ``Southern''
shall be changed to ``Pacific Northwest''.
(B) In section 9(b), the reference to ``Atlanta, Georgia''
shall be changed to ``Seattle, Washington''.
(C) In section 20, the reference to ``any three'' and all
that follows shall be changed to ``California, Oregon, and
Washington.''.
(2) Limitation of manufacturing price regulation.--The
Dairy Compact Commission established to administer the
Pacific Northwest Dairy Compact (referred to in this section
as the ``Commission'') may not regulate Class II, Class III,
or Class IV milk used for manufacturing purposes or any other
milk, other than Class I, or fluid milk, as defined by a
Federal milk marketing order issued under section 8c of the
Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with
amendments by the Agricultural Marketing Act of 1937
(referred to in this section as a ``Federal milk marketing
order'').
(3) Effective date.--Congressional consent under this
section takes effect on the date (not later than 3 year after
the date of enactment of this Act) on which the Pacific
Northwest Dairy Compact is entered into by the second of the
3 States specified in the matter preceding paragraph (1).
(4) Compensation of commodity credit corporation.--Before
the end of each fiscal year in which a price regulation is in
effect under the Pacific Northwest Dairy Compact, the
Commission shall compensate the Commodity Credit Corporation
for the cost of any purchases of milk and milk products by
the Corporation that result from the operation of the Compact
price regulation during the fiscal year, as determined by the
Secretary (in consultation with the Commission) using notice
and comment procedures provided in section 553 of title 5,
United States Code.
(5) Milk marketing order administrator.--At the request of
the Commission, the Administrator of the applicable Federal
milk marketing order shall provide technical assistance to
the Commission and be compensated for that assistance.
SEC. 5. INTERMOUNTAIN DAIRY COMPACT.
Congress consents to an Intermountain Dairy Compact
proposed for the States of Colorado, Nevada, and Utah,
subject to the following conditions:
(1) Text.--The text of the Intermountain Dairy Compact
shall be identical to the text of the Southern Dairy Compact,
except as follows:
(A) In section 1, the references to ``southern'' and
``south'' shall be changed to ``Intermountain'' and
``Intermountain region'', respectively.
(B) References to ``Southern'' shall be changed to
``Intermountain ''.
(C) In section 9(b), the reference to ``Atlanta, Georgia''
shall be changed to ``Salt Lake City, Utah''.
(D) In section 20, the reference to ``any three'' and all
that follows shall be changed to ``Colorado, Nevada, and
Utah.''.
(2) Limitation of manufacturing price regulation.--The
Dairy Compact Commission established to administer the
Intermountain Dairy Compact (referred to in this section as
the ``Commission'') may not regulate Class II, Class III, or
Class IV milk used for manufacturing purposes or any other
milk, other than Class I, or fluid milk, as defined by a
Federal milk marketing order issued under section 8c of the
Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with
amendments by the Agricultural Marketing Act of 1937
(referred to in this section as a ``Federal milk marketing
order'').
(3) Effective date.--Congressional consent under this
section takes effect on the date (not later than 3 year after
the date of enactment of this Act) on which the Intermountain
Dairy Compact is entered into by the second of the 3 States
specified in the matter preceding paragraph (1).
(4) Compensation of commodity credit corporation.--Before
the end of each fiscal year in which a price regulation is in
effect under the Intermountain Dairy Compact, the Commission
shall compensate the Commodity Credit Corporation for the
cost of any purchases of milk and milk products by the
Corporation that result from the operation of the Compact
price regulation during the fiscal year, as determined by the
Secretary (in consultation with the Commission) using notice
and comment procedures provided in section 553 of title 5,
United States Code.
(5) Milk marketing order administrator.--At the request of
the Commission, the Administrator of the applicable Federal
milk marketing order shall provide technical assistance to
the Commission and be compensated for that assistance.
Ms. LANDRIEU. Mr. President, today I rise, along with thirty-eight of
my colleagues, to introduce legislation which would reauthorize the
Northwest Dairy Compact and establish the Southern, Pacific and Inter-
mountain Compacts.
State officials and dairy producers across the country are concerned
that the current Federal milk marketing order pricing system does not
fully account for regional differences in the costs of producing milk.
As a result, 25 States, including my State of Louisiana, have passed
legislation requesting that Congress approve their right to form
regional compacts. The compact, when ratified by Congress, authorizes
creation of an interstate compact commission which would guide the
pricing of fluid milk sold in the region. Consumers, processors,
producers, State officials and the public all participate in
determining Class I fluid milk prices.
The Northeast Dairy Compact, enacted in 1996, and due to expire this
year, has proven extremely successful in balancing the interests of
consumers, dairy farmers, processors and retailers by maintaining milk
price stability and doing so at no cost to taxpayers.
By ratifying the Southern Dairy Compact we have the opportunity to
assure consumers an adequate, affordable and fresh milk supply while
preserving the health of farms, whose social and economic contributions
remain so critical to the vitality of our country's rural communities.
In my State of Louisiana, over four hundred dairy farms help maintain
economic stability in one of our Nation's poorest regions. In the past
ten years, nearly a quarter of the dairy farms in my State have gone
out of business, and many more are in danger of shutting down unless we
authorize the return of milk pricing power back to the States. Had
Louisiana been a member of a Southern Dairy Compact last year, its 468
dairy farms would have received $11.9 million in compact payments,
increasing income for the average Louisiana dairy farmer by nearly
thirteen percent. This, at a time when dairy farmers are faced with
depressed prices not seen in the last 25 years.
There are those in Congress who have opposed dairy compacts since the
day the idea was introduced. However, dairy compacts are not antitrade,
do not increase milk production and milk from outside the compact
region is not excluded from sale in the compact region. Over the past
five years, New England's dairy farmers have put into practice the
compact's promise of providing stable prices for farmers and
[[Page S7253]]
consumers, strengthening rural communities and preserving our
environment. It is time to allow the States the opportunity to provide
their farmers the stability they so desperately need.
Ms. COLLINS. Mr. President, I rise with my colleagues today to
introduce the Dairy Consumers and Producers Protection Act. Our
legislation reauthorizes the Northeast Interstate Diary Compact and
allows other regions of the country to form compacts as well. In doing
so, our bill extends to additional consumers and producers the benefits
we enjoy in the Northeast.
The Northeast Dairy Compact has proven successful in balancing the
interests of processors, retailers, consumers and dairy farmers by
maintaining milk price stability. Last year, 458 dairy farmers in Maine
received payments under the compact totaling $4.8 million. The payments
averaged approximately $10,500 per farmer, or enough to help farmers
maintain viable operations, sustain rural communities, and ensure a
reliable supply of wholesome dairy products for consumers.
The Northeast Dairy Compact is an innovative approach to promoting
stability in the New England dairy industry. The Compact provides for a
commission, comprised of delegates from each State, which is granted
the authority to set a minimum farm price for Class I (fluid) milk. The
difference between the compact price and the Federal milk order price,
or the ``over-order obligation,'' is paid to the commission by the
processors. The commission then redistributes these funds to compact
producers based on the volume of milk sold by the farmer within the
region.
The success of the Northeast Dairy Compact in promoting the viability
of dairy farming and sustaining rural communities in New England has
not gone unnoticed. Nineteen additional State legislatures have
overwhelmingly passed compact legislation. Our legislation recognizes
this strong support for compacts on the state level and provides
Congressional consent for these States to join the Northeast compact or
form compacts of their own.
For all that the Compact accomplishes for farmers in the Northeast,
one might think that it puts farmers from other parts of the country at
a competitive disadvantage. However, this is not the case. The Compact
Commission has instituted safeguards, as required by the authorizing
legislation, that prevents the overproduction of milk. Incentive
payments are provided to farmers who do not increase production and
have actually led to a decrease of 0.6 percent in the amount of milk
produced in the region. Consequently, we can be sure that surplus milk
from the Northeast is not impacting milk markets in other regions of
the country. It is important to note that our legislation includes the
overproduction protections included in the original Dairy Compact
legislation.
The Northeast Dairy Compact is set to expire on September 30, 2001.
While the saying goes that all good things must come to an end, I do
not believe that ought to be the case with the Compact. Dairy farmers
in my State agree and have written, e-mailed, and called to express to
me their hope that Congress will extend the authorization of the
Northeast Dairy Compact. I have appreciated hearing just how important
the Compact is to my constituents, and I look forward to working with
my colleagues in the Senate to see that the Diary Consumers and
Producers Protection Act is enacted.
Mr. JOHNSON. Mr. President, I rise today to strongly support the
extension and the expansion of the Northeast Dairy Compact as a
reasonable and proven way to help dairy farmers in New England and
beyond.
Dairy farms are truly the agricultural heart of New York State. Their
survival is vital to the economic, social, and cultural well-being of
the State. I am such an enthusiastic advocate for the Compact because,
it offers the means to maintain not only healthy dairy farms in my
State, but the rural settings and communities upon which so much of New
York and the rest of the country depend.
Historically, dairy prices have been subject to unpredictable and
unacceptable fluctuations in prices. In the face of such uncertainty,
the current Federal price support system was designed to provide basic
levels of assistance to dairy producers. Unfortunately, the support
provided, while helpful, is often inadequate. Many dairy farmers in New
York and elsewhere are unable to operate at a profit. As a remedy, the
Dairy Compact was designed to provide producers with supplemental
support, through assessments to processors, when the Marketing Order
price is low. Most importantly, the price stability afforded by the
Compact is especially important to farmers as a planning tool.
As originally implemented, the Dairy Compact did not include New
York. The Bill that has been introduced would allow New York State and
other States in the Northeast, Southeast and elsewhere to join the
Compact. The New York Legislature, like 25 other State Legislatures,
has voted to join the Compact. Why? Because over the 4 years that the
Compact has been in existence it has made the difference for many
family farmers between surviving as a dairy producer or selling their
land for development which is slowly decimating our rural landscape. It
has helped us maintain a local supply of affordable milk for consumers
including women and children throughout the Compact region at no cost
to the government and without placing an undue burden on consumers.
New York is an important dairy producing and consuming State. As of
the year 2000, we had about 7,200 dairy herds and produced 11.9 billion
pounds of milk. That year, New York ranked third behind California and
Wisconsin in both the number of milk cows and total milk produced. The
viability of dairy farms is very, very important to my State. If New
York had been a member of compact that year when dairy prices were at
rock bottom, they would have received an average payment per farm of
$18,200. While that size payment will not lead to prosperity, it will
help keep the farm going. Several New York dairy farms sell milk to the
Compact, and thus receive some of these benefits. I want to ensure that
all dairy farms are in the State can participate, and the only way to
do that is to expand the Compact.
Opponents of the Compact claim that if it were to be expanded,
farmers in the Compact region would overproduce fluid milk thus driving
prices down in other parts of the country. This is not the case. The
Compact legislation that we propose today specifically acts to prevent
such an over production through a supply management feature that
rewards dairy producers in the Compact who maintain relatively stable
levels of production. If needed, this tool could be used to control
over-production from an expanded Compact and thus minimize negative
impacts elsewhere.
Other important features of the Compact that are important to
remember include the following: It has been fully reviewed and found to
be legal. It includes a feature to protect disadvantaged women, infant
and children, and in fact, in the year 2000, the Compact paid the WIC
program close to $1.8 million to reimburse WIC for any extra expense
the program incurred under the Compact. Approximately 1 percent of
Compact payments are similarly set aside to reimburse school lunch
programs.
I am concerned about the move towards consolidation in the dairy
industry. While some concentration is to be expected, recent trends
indicate that a few very large dairy operations and processing plants
are grabbing up more and more. Many dairy operations are also
succumbing to unplanned sprawl. By helping small at-risk farms stay
afloat, the Compact is a hedge against unhealthy amounts of
consolidation. It also helps to preserve the rural life style, the
countryside settings with open spaces, and the economic core of
communities that are so important to my New York and so many others.
In sum, the Dairy Compact is an effective way for States, New York
and others, to obtain from Congress the regulatory authority over the
region's interstate markets for milk. It offers a price stability that
is incredibly helpful, and it helps to slow the demise of a tradition
that our country holds dear, the family farm.
Ms. SNOWE. Mr. President, I rise today to join Senator Specter of
Pennsylvania in support of the Dairy Consumers and Producers Protection
Act of 2001. We are joined by 37 of our colleagues from New England and
throughout the Mid-Atlantic and the Southeast.
[[Page S7254]]
This legislation reauthorizes the very successful Northeast
Interstate Dairy Compact which allows the producers of milk to, as a
dairy farmer from York Country, ME, recently said, set a little higher
bottom for the price of locally produced fresh milk. The current
Compact only adds a small incremental cost to the current Federal milk
marketing order system that already sets a floor price for fluid milk
in New England. The bill also gives approval for States contiguous to
the participating New England States to join, in this case,
Pennsylvania, New York, New Jersey, Delaware, and Maryland.
The legislation also grants Congressional approval for a new Southern
Dairy Compact, made up of 14 States: Alabama, Arkansas, Georgia,
Kansas, Kentucky, Louisiana, Mississippi, Missouri, North Carolina,
Oklahoma, South Carolina, Tennessee, Virginia, and West Virginia.
This issue is really a State rights issue more than anything else,
Mr. President, as the only action the Senate needs to take is to give
its congressional consent under the Compact Clause of the United States
Constitution, Article I, section 10, clause 3, to allow the 25 States
to proceed with their two independent compacts.
All of the legislatures in these twenty-five States have ratified
legislation that allows their individual States to join a Compact, and
the Governor of every State has signed a compact bill into law. Half of
the States in this country, await our Congressional approval to address
farm insecurity by stabilizing the price of fresh fluid milk on grocery
shelves and to protect consumers against volatile price swings.
All of the Northeast and Southern Compact States together make up
about 28 percent of the Nation's fluid milk market--New England
production is only about 3\1/2\ percent of this. This is somewhat
comparable to Minnesota and Wisconsin which together make up to 24
percent of the fluid milk market. California makes up another 20
percent.
Over ninety-seven percent of the fluid milk market in New England is
contained within the area, and fluid milk markets are local due to the
demand for freshness and because of high transportation costs, so any
complaints raised in other areas about unfair competition simply does
not hold water. The existence of the Northeast Dairy Compact does not
threaten or financially harm any other dairy farmer in the country. Nor
is there one penny of Federal funds involved--not one cent.
Only the consumers and the processors in the New England region pay
to support the minimum price to provide for a fairer return to the
area's family dairy farmers and to protect a way of life important to
the people of the Northeast. Importantly, under the Compact, New
England retail milk prices have been among the lowest and the most
stable in the country. No wonder other States want to follow our lead.
When Congress wants to try something new, it often sets up a pilot
program to test out an idea in a particular locality or region, and
then appraises the outcome to see if the project was successful. This
is how the Northeast Dairy Compact originated as it was included in the
1996 Farm bill as a three year pilot program--to sunset on April 4,
1999--at the same time as the adoption of the required consolidation of
Federal milk marketing orders. The milk marketing orders were extended
until October 1, 1999 in the Omnibus Appropriations of FY 1999, which
also automatically extended the Compact until October 1, 1999.
Because of efforts by myself and other Compact supporters, we fought
to receive a two-year extension of the Northeast Compact, which was
incorporated in the Omnibus spending bill funding several government
agencies for FY 2000. The Compact will expire on September 30 of this
year if no further action is taken by this body.
I want to make it clear to my colleagues how important the
continuation of the Northeast Dairy Compact is to me and the dairy
farmers and consumers in Maine. I stand here not with my hand
outstretched for federal farm dollars for Maine--of all income received
by farmers in my State, only about 9 percent comes from Federal
funding, unlike other States whose income received through Federal
dollars is well over 75 percent--rather to urge you to support a very
successful program that does not cost the federal government one
penny--not one cent, and is supported by the very people who are
affected by it.
I plan to use every avenue open to me to make sure the Compact
continues to operate as, once the Compact Commission is shut down even
temporarily, it cannot magically be brought back to life again. It
would take many months if not a year to restore the successful process
that is now in place. I will not gamble with the livelihoods of the
dairy farmers of Maine in that irresponsible fashion.
All during the time of the Northeast Compact, fluid milk prices in
New England have been among the lowest and have reflected great price
stability. The consumers of New England have been spending a few extra
pennies for fresh fluid milk--a recent University of Connecticut report
recently estimated no more than 4.5 cents a gallon--to ensure a safety
net for dairy farmers so that they can continue a historic way of life
that is helpful to the regional economy.
I have been pleasantly surprised that, while my mail certainly
reflects discontent when gasoline prices rise by pennies, I have not
received any swell of outrage of consumer complaints about milk prices
over the last 3\1/2\ years that the Compact has been in place. The
reality is that the initial pilot Compact project we so thoughtfully
created has been a huge success.
In 2000, dairy farmers in Maine received on average, $10,500 per
dairy farm from the Compact Commission, the governing body set up to
keep overproduction of fluid milk in check, and among other duties,
ensure that the Federal nutrition programs, such as the Women, Infants,
and Children Program, or WIC, are held harmless under the Compact. In
fact, the advocates of these federal nutrition programs support the
Compact and serve on its commission.
The Northeast Interstate Dairy Compact has provided the very safety
net that we had hoped for when the Compact passed as part of the
omnibus farm bill of 1996. The Dairy Compact has helped farmers
maintain a stable price for fluid milk during times of volatile swings
in farm milk prices.
Also, consider what has happened to the number of dairy farms staying
in business since the formation of the Dairy Compact. It is now known
that, throughout New England, there has been a decline in the number of
dairy farmers going out of business. In Maine, for instance, the loss
of dairy farms was 16 percent from 1993 to 1997. The Compact then went
into effect and from that time until now, the loss of dairy farms has
dropped to 9 percent.
The Compact has given dairy farmers a measure of confidence in the
near term for the price of their milk so they have been willing to
reinvest in their operations by upgrading and modernizing facilities,
acquiring more efficient equipment, purchasing additional cropland and
improving the genetic base of their herds. Without the Compact, farmers
would not have had the courage to do these things and their lenders
would not have had the willingness to meet their capital needs.
The Compact has also protected future generations by helping local
milk remain in the region and preventing dependence on milk a single
source of milk that can lead to higher milk prices through increased
transportation costs and increased vulnerability to natural
catastrophes.
The bottom line is, the Compact has helped the economies of the New
England States. The presence of farms are protecting open spaces
critical to every State's recreational, environmental and conservation
interests. These open spaces also serve as a buffer to urban sprawl and
boost tourism so important to my home state of Maine.
Through its bylaws, the Compact has also preserved State sovereignty
by adopting the principle of ``one state--one vote,'' requiring that
any pricing change be approved by two-thirds of the participating
states in the Compact.
There are compensation procedures that are implemented by the New
England Dairy Commission specifically to protect against increased
production of fresh milk. The Compact requires that the Compact
Commission take such action as necessary to ensure that a minimum price
set by the commission for
[[Page S7255]]
the region over the Federal milk marketing order floor price does not
create an incentive for producers to generate additional supplies of
milk. When there has been a rise in the Federal floor price for Class I
fluid milk, the Compact has automatically shut itself off from the
pricing process. Since there is no incentive to overproduce, there has
been no rush to increase milk production in the Northeast as was feared
by Compact opponents. No other region should feel threatened by a dairy
compact for fluid milk produced and sold mainly at home.
The consumers in the Northeast Compact area, the now in the Mid-
Atlantic area and the Southeast area, have shown their willingness to
pay a few pennies more for their milk if the additional money is going
directly to the dairy farmer. Environmental organizations have also
supported dairy compacting as Compacts help to preserve dwindling
agricultural land and open spaces.
I urge my colleague not to look success in the face and turn the
other way, but to support us in passing this legislation that half of
our states have requested.
Mrs. CLINTON. Mr. President. I am pleased to join with my colleagues
today as an original cosponsor of the Dairy Consumers and Producers
Protection Act of 2001. This legislation is vitally important to New
York dairy farmers, New York's economy, and rural communities around
the country.
From Watertown and Glen Falls to Ithaca and Jamestown, NY farmers and
New York farms are an invaluable part of our State's economy and its
landscape. Agriculture is one of New York's top industries. What is
grown in our State makes its way to homes and kitchen tables across the
country, and around the world.
In particular, the dairy industry is a pillar of New York's economy.
Milk is New York's leading agricultural product, creating almost $2
billion in receipts. And New York ranks third in the country in terms
of the value of dairy products sold, surpassed only by California and
Wisconsin.
Yet, as I travel throughout New York State, I meet dairy farmers who
are working harder, but still struggling to make ends meet. Volatile
milk prices make it very difficult for New York dairy farmers to
negotiate loans, to invest in expansion, and to plan for the future.
That is why it is so important that we join with our colleagues from
other States to expand the Northeast Dairy Compact to include New York.
If New York had been a member of the Northeast Dairy Compact last year,
the over 7,000 dairy farms in New York would have received an estimated
$132.6 million in payments, an average of $18,200 for each farm,
thereby increasing income for the average New York dairy farm by
approximately eight percent.
In addition, New York farmland and farms have become prime land for
development and sprawl. We must make sure that farmers all across New
York and around the country get the help that they need to hold onto
their farms, and to preserve our fields and open spaces. They are an
important part of what makes New York so unique and so beautiful.
Helping to preserve New York's dairy farms by expanding the Northeast
Diary Compact is the right thing to do. Not only does it ensure the
security of our dairy farmers in New York and in other parts of the
country, it guarantees an adequate supply of fresh milk at reasonable
prices and helps to preserve precious open space.
Mr. JEFFORDS. Mr. President, today, I rise today to express my
support for the Dairy Consumers and Producers Protection Act of 2001,
important legislation that would re-authorized and expand the Northeast
Dairy Compact, and ratify a Southern Compact. Growing support and
recognition of the effectiveness and ingenuity of the Northeast Dairy
Compact has led twenty-five States to enact compact legislation. These
States now look to Congress to grant them the right to join the
Northeast Compact, or to form a Southern Compact.
It is critical that we keep pace with the demands of State
governments, and provide them with the authority to develop a regional
pricing mechanism for Class I (fluid) milk. Farmers across our Nation
face radically different conditions and factors of production.
Differences in climate, transportation, feed, energy and land value
validate the need for regional pricing. Compacts allow States to
address these differences and create a price level that is appropriate
for producers, processors, retailers, and consumers.
The Northeast Dairy Compact was originally authorized as a three-year
pilot program in the 1996 Farm Bill. Sine July of 1997, when the
Compact Commission first set the Class I over-order price at $16.94,
the Northeast Dairy Compact has proven to be a great success, providing
farmers with a fair price for their milk, protecting consumers from
price spikes, reducing market dependency upon milk from a single
source, controlling excess supply, and helping to preserve rural
landscapes by strengthening farm communities. And, unlike so many of
our country's agricultural programs, the benefits of the dairy compact
are realized at no cost to the Federal Government.
The Northeast Dairy Compact is managed by the Compact Commission. The
Commission, comprised of 26 delegates from the six New England member
States, includes producers, processors, retailers and consumer
representatives. Each State governor appoints three or five delegates
to represent their State's vote on the Commission. The Commission meets
monthly to evaluate and establish the current Compact over-order price
for Class I (fluid) milk. Using a formal rule-making process, the
Commission hears testimony to establish a price that takes into account
the purchasing power of the public, and the price necessary to yield a
reasonable return to producers and distributors. Any price change
proposed by the Commission is subject to a two-thirds vote by the State
delegations as well as a producer referendum.
The Compact Commission's price regulation works in conjunction with
the Federal Government's pricing program, which establishes minimum
prices paid to dairy farmers for their raw milk. Under the Compact,
processors pay the difference between the Compact over-order price for
fluid milk, currently $16,94, and the price established monthly by
federal regulation for the same milk. The over-order premium is paid on
class I (fluid) milk, and is only paid when the Compact over-order
price is higher than the price set by the Federal milk marketing
orders. Processors purchasing milk for other dairy products such as
cheese or ice cream are not subject to the Compact's pricing
regulations, although all farmers producing milk in the region, for any
purpose, share equally in the Compact's benefits.
In order to protect low-income consumers from any increases in cost
caused by the Compact, the Compact legislation imposes regulations on
the Commission requiring that the Women, Infants and Children, WIC
program, as well as School Lunch Programs, must be reimbursed for any
additional costs they may incur as a result of compact activity. Three
percent of the pooled proceeds are set aside to fulfill these
obligations.
Compact legislation also contains a clause that holds the Commission
responsible for any purchases of milk or milk products by the Commodity
Credit Corporation, CCC, that result from the operation of the Compact.
The Secretary of Agriculture has the authority to determine those costs
and ensure that the Commission honors its obligations.
After money is withheld for the WIC and School Lunch programs, as
well the CCC, the Compact Commission makes disbursements to farmer
cooperatives and milk handlers. These entities then make payments to
individual farmers based on their level of production. These payments
are only made when the Federal market order price falls below the price
set by the Compact Commission, effectively creating a floor for milk
prices. This, in turn, decreases price volatility in the region.
The stability created by the Compact pricing mechanism is important
for several reasons. It guarantees farmers a fair price for their
product and allows them to plan for the future. Farmers, knowing that
they can count on a fair price, can allocate money to purchase and
repair machinery, improve farming practices, and above all, stay in
business.
[[Page S7256]]
Throughout our great Nation, the family farm continues to be a vital
part of our rural community and agricultural infrastructure. In New
England, and across our country, farms continue to support our rural
economies. Farms create economic stability by supporting local
businesses such as feed stores, farm equipment suppliers and local
banks. The continuing disappearance of small farms is making life very
difficult for agri-businesses and disrupting the overall rural economic
infrastructure.
The importance of the family farm extends well beyond the rural
economy, however. Preservation of the family farm has important
environmental consequences as well. Numerous environmental
organizations have expressed their support for dairy compacts. They
recognize the ability of compacts to protect our farms and preserve our
dairy industry. These organizations include the Sierra Club, the
Conservation Law Foundation and the National Trust for Historic
Preservation. These groups, as well as numerous other environmentally
conscious organizations, recognize farmers as good stewards of the
land, and value the ability of farms to sustain productive use of the
land, while preserving open space.
Even though compacts enjoy widespread support across much of our
country, opponents have worked tirelessly to discredit the merits of
dairy compacts. These critics, however, must contend with the strong
record of success that the Northeast Dairy Compact has put forth.
During its first four years, the Northeast Compact has stood up to
numerous legal challenges. Courts have ruled in favor of the Compact on
every level, including the U.S. Supreme Court. The courts have
recognized the Compact as a proper and constitutional grant of
congressional authority, permitted under the Commerce and Compact
clauses of the U.S. Constitution. These decisions have upheld the
Commission's authority to regulate milk within the region, as well as
milk produced outside of the region.
Concerns have also been raised about the Compact's effect on
interstate trade. Opponents of the Northeast Compact argue that
compacts restrict the movement of milk between States that are in the
Compact, and States that lie outside the Compact. Compacts, however, do
not restrict the movement of milk into the region. For example,
producers in eastern New York State benefit from the Northeast Compact.
By shipping their milk in the region, farmers are eligible to receive
the Compact price for their products.
Another common misconception is that the Compact leads to
overproduction. The Northeast Dairy Compact, however, has not led to
overproduction during its first four years. In fact, during 2000, the
Northeast Dairy Compact states produced 4.7 billion pounds of milk, a
0.6 percent reduction from 1999. Since the Northeast Dairy Compact has
been in effect, milk production in the region has risen by just 2.2
percent. Nationally, milk production rose 7.4 percent from 1997 to
2000. Over this same period, California, the largest milk producing
Sate in the country, increased its milk production by 16.9 percent.
To protect against overproduction, the Compact Commission has
developed a supply management program that rewards farmers who do not
increase production. Under the program, 7.5 cents per hundred-weight is
withheld by the Commission. This money is refunded to producers that
have not increased their production by more than 1 percent during the
given year. While this program has only been in place since 2000, we
believe that it will be a useful tool in preventing overproduction.
Finally, opponents argue that compacts are harmful to consumers,
especially low-income consumers. The facts show that this not the case.
On May 2, 2001, an independent study out of the University of
Connecticut's Food Marketing Policy Center offers new evidence
regarding the impact of the Northeast Dairy Compact on consumer prices.
The Food Marketing Policy Center performed a four-year analysis of
retail milk prices using supermarket scanner data from 18 months prior
to Compact implementation, up through July of 2000. This period of time
captured the volatile prices preceding Compact implementation, as well
as the pricing behavior that followed. The study found that the
Northeast Dairy Compact was responsible for only 4.5 cents of the 29-
cent increase in retail prices following Compact implementation. The
study concludes that wider profit margins by processors and retailers
account for 11 cents of the 29-cent increase. Since the Compact went
into effect, these wider profit margins have drawn nearly $50 million
out of the pockets of New England consumers.
The study suggests that retail stores and processors have used price
gouging and ``tacitly collusive price conduct'' to lock in wider profit
margins. The study states: ``Leading firms in the supermarket-marketing
channel have used their dominant market positions to elevate retail
prices in the Northeast Compact Region.'' In conclusion, the study
contends: ``The major policy now facing New England consumers of fluid
milk is not the Northeast Dairy Compact. It is the exercise of market
power by the region's leading retailers and milk processor.'' While
this study raises some serious concerns regarding the New England dairy
industry, it illustrates that the effects of the Compact on consumers
have been benign.
A May 11, 2001 article in Cheese Market News written by Jim Tillison,
Chairman of the Alliance of Western Producers, further addresses the
consumer issue. Mr. Tillison writes:
``Now, unless I am wrong, in every dairy state there are
many times more consumers than dairy farmers. It would seem
that it would be very difficult to get compact legislation
passed if consumers were strongly opposed to it. That must
not have been the case if some 25 state legislatures have
passed compact legislation. What's more, 25 governors who
have had the power to veto state compact legislation haven't.
(Cheese Market News, May 11, 2001)
Tillison continues by examining the reasons why consumers support the
Compact. These include decreases in retail price volatility and the
need for a fresh supply of milk. Tillison states, ``Consumers like the
idea of milk for their kids being produced locally. Even though the
milkman delivering ``fresh'' milk to the consumer's doorstep is a thing
of the past, that doesn't mean that consumers don't want fresh milk.''
At this time, I would ask unanimous consent that Jim Tillison's
article, ``Let's Talk About Compacts'' be submitted for the Record.
Under our legal system, individual states have the authority to
establish their own dairy pricing mechanism. Because of the nature and
size of the dairy industries in the Northeast and South, states in
these regions are better served by coming together to form a unified
pricing mechanism. By supporting the rights of states to form dairy
compacts, we maintain the safety and continuity of our milk supply,
protect consumers from volatile milk prices, and conserve open land.
Originally created as a three-year pilot program, the Northeast Dairy
Compact has been extremely successful in demonstrating the merits of
compacts. We no longer need to speculate about the potential effects of
compacts. We now have the hard evidence, they are good for farmers,
good for consumers, and good for the environment. I ask that the Senate
recognize this by extending and expanding the Northeast Dairy Compact,
and ratifying a Southern Compact.
In closing, I urge the Senate to support this important legislation.
Our States have come to us, and asked us to grant them the right to
regulate the minimum farm price of milk, the right to save their family
farms. We must grant them that right.
There being no objection, the material was ordered to be printed in
the Record, as follows:
[From the Cheese Market News, May 11, 2001]
Let's Talk About Compacts
(By Jim Tillison)
Here we go again. The issue of dairy compacts is ``heating
up'' once again. Studies have been done and to now one's
surprise they are biased depending on which aide you are on.
Let's try to look past all the rhetoric to what is causing
all the stir and discuss the stir that is being caused.
First, let us review the process involved in putting a
dairy compact in place.
Essentially, the compact process result in negating
interstate commerce laws. In other words, it allows the dairy
producers in a number of states to regulate the price of milk
paid by fluid processors in those states. Any milk brought
into the state for fluid purposes is subject to the compact.
The process starts with the state legislatures in each
state in which interested producers reside passing
legislation supporting
[[Page S7257]]
putting a compact in place. Now, unless I am wrong, in every
dairy state there are many times more consumers than dairy
farmers. It would seem that it would be very difficult to get
compact legislation passed if consumers were strongly opposed
to it. That must not be the case if some 25 state
legislatures have passed compact legislation. What's more, 25
governors who have had the power to veto state compact
legislation haven't.
Arguably, this is proof that consumers are not opposed to
dairy compacts even though it can result in higher milk
prices. One reason could be that the extra revenue the
compact price generates over and above the federal order
price (when, and only when, it is higher than the set compact
price) goes directly to the dairy farmers.
Another reason could be that a compact minimum Class I
price removes much of the volatility from consumer prices.
Just as there was a lot less volatility in milk prices when
the support price was $13.10, there is a lot less volatility
when Class I has a minimum price, too.
Still another reason could be that consumers like the idea
of milk for their kids being produced ``locally.'' Milk isn't
orange juice. It has a different mystique. Even though the
milkman delivering ``fresh'' milk to the consumer's doorstep
is a thing of the past, that doesn't mean that consumers
don't want fresh milk. The lack of success that UHT milk and
powdered milks have had here as compared to Europe, one could
argue, is because of consumers' desire for (and the
availability of) fresh milk.
One can sort of understand fluid processors opposing dairy
compacts. It certainly can result in higher average milk
costs for processors. Fortunately for the processor, the
consumer is apparently willing to accept the slight increase.
And, if one study reported on is correct, processors and
retailers are taking advantage of the consumer's willingness
as well.
What is difficult to understand is the opposition to
compacts by some producers. This opposition seems to be based
on the fear that it will negatively affect them. This fear
appears to have been generated more by economic theory than
fact.
The theory was based on a single premise--money makes milk,
more money makes more milk. A dairy compact will give
producers in compact states more money. This will result in
them producing more milk. This additional milk will go into
manufactured products which will hurt producers in states
where the majority of milk goes into cheese. At least that's
the theory.
The fact is that more money hasn't brought on more milk in
the one compact area currently in existence. Only one of the
Northeast compact states, Vermont, is in the top 20 milk-
producing states. And, the total area has not seen milk
production rise faster there than the national average.
Has the Northeast Compact hurt producers in other areas of
the country? The answer is no. Will a Southeast Compact bring
on a surge of milk production? Again, the answer is no. Just
take a look at what happened after Class I differentials were
raised $1.00 per hundred weight in the Southeast in 1986. Did
milk production boom? Did it outstrip demand? Did cheese
plants spring up from Arkansas to Florida? No, no, no.
Finally, the argument that really makes me knuckle is that
the Northeast Compact passage and implementation was
political. It wasn't mandated by Congress. It didn't stand on
its own two feet. Congress never got to vote on the compact
on its own. It was only supposed to be a transition program
while federal order reform was taking place. Secretary of
Agriculture Dan Glickman didn't have to implement it.
Don't ask me to respond to those kind of comments. What
hearing was ever held or separate vote taken on forward
contracting? I don't recall any serious discussion of the
portion of a recent budget bill that exempted one county in
Nevada from federal order Class I differentials. Of course
Glickman had to implement it . . . the pet project of a
Vermont Democratic senior senator in an election year. Think
about it.
The dairy industry has many more important issues to spend
political capital on. Issues that really are having, or will
have, an impact on it. Instead of fighting over compacts, it
should be working together to improve our potential for
growth in world markets by really pushing for fair trade,
dealing with environmental and food safety issues and
developing programs that will allow all segments of the
industry to continue to flourish in the 21st century.
The views expressed by CMN's guest columnists are their own
opinions and do not necessarily reflect those of Cheese
Market News.
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