US Laws, Codes, Statutes & Cases

From the U.S. Code Online via GPO Access
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[Laws in effect as of January 7, 2003]
[Document not affected by Public Laws enacted between
  January 7, 2003 and December 19, 2003]
[CITE: 49USC40112]

 
                        TITLE 49--TRANSPORTATION
 
                     SUBTITLE VII--AVIATION PROGRAMS
 
                     PART A--AIR COMMERCE AND SAFETY
 
                           subpart i--general
 
                     CHAPTER 401--GENERAL PROVISIONS
 
Sec. 40112. Multiyear procurement contracts for property

    (a) General Authority.--Notwithstanding section 1341(a)(1)(B) of 
title 31 and to the extent that amounts otherwise are available for 
obligation, the Administrator of the Federal Aviation Administration may 
make a contract of more than one but not more than 5 fiscal years to 
purchase property, except a contract to construct, alter, or make a 
major repair or improvement to real property.
    (b) Required Findings.--The Administrator may make a contract under 
this section if the Administrator finds that--
        (1) the contract will promote the safety or efficiency of the 
    national airspace system and will result in reduced total contract 
    costs;
        (2) the minimum need for the property to be purchased is 
    expected to remain substantially unchanged during the proposed 
    contract period in terms of production rate, procurement rate, and 
    total quantities;
        (3) there is a reasonable expectation that throughout the 
    proposed contract period the Administrator will request 
    appropriations for the contract at the level required to avoid 
    cancellation;
        (4) there is a stable design for the property to be acquired and 
    the technical risks associated with the property are not excessive; 
    and
        (5) the estimates of the contract costs and the anticipated 
    savings from the contract are realistic.

    (c) Regulations.--The Administrator shall prescribe regulations for 
acquiring property under this section to promote the use of contracts 
under this section in a way that will allow the most efficient use of 
those contracts. The regulations may provide for a cancellation 
provision in the contract to the extent the provision is necessary and 
in the best interest of the United States. The provision may include 
consideration of recurring and nonrecurring costs of the contractor 
associated with producing the item to be delivered under the contract. 
The regulations shall provide that, to the extent practicable--
        (1) to broaden the aviation industrial base--
            (A) a contract under this section shall be used to seek, 
        retain, and promote the use under that contract of 
        subcontractors, vendors, or suppliers; and
            (B) on accrual of a payment or other benefit accruing on a 
        contract under this section to a subcontractor, vendor, or 
        supplier participating in the contract, the payment or benefit 
        shall be delivered in the most expeditious way practicable; and

        (2) this section and regulations prescribed under this section 
    may not be carried out in a way that precludes or curtails the 
    existing ability of the Administrator to provide for--
            (A) competition in producing items to be delivered under a 
        contract under this section; or
            (B) ending a prime contract when performance is deficient 
        with respect to cost, quality, or schedule.

    (d) Contract Provisions.--(1) A contract under this section may--
        (A) be used for the advance procurement of components, parts, 
    and material necessary to manufacture equipment to be used in the 
    national airspace system;
        (B) provide that performance under the contract after the first 
    year is subject to amounts being appropriated; and
        (C) contain a negotiated priced option for varying the number of 
    end items to be procured over the period of the contract.

    (2) If feasible and practicable, an advance procurement contract may 
be made to achieve economic-lot purchases and more efficient production 
rates.
    (e) Cancellation Payment and Notice of Cancellation Ceiling.--(1) If 
a contract under this section provides that performance is subject to an 
appropriation being made, it also may provide for a cancellation payment 
to be made to the contractor if the appropriation is not made.
    (2) Before awarding a contract under this section containing a 
cancellation ceiling of more than $100,000,000, the Administrator shall 
give written notice of the proposed contract and cancellation ceiling to 
the Committee on Commerce, Science, and Transportation of the Senate and 
the Committee on Transportation and Infrastructure of the House of 
Representatives. The contract may not be awarded until the end of the 
30-day period beginning on the date of the notice.
    (f) Ending Contracts.--A contract made under this section shall be 
ended if amounts are not made available to continue the contract into a 
subsequent fiscal year. The cost of ending the contract may be paid 
from--
        (1) an appropriation originally available for carrying out the 
    contract;
        (2) an appropriation currently available for procuring the type 
    of property concerned and not otherwise obligated; or
        (3) amounts appropriated for payments to end the contract.

(Pub. L. 103-272, Sec. 1(e), July 5, 1994, 108 Stat. 1108; Pub. L. 104-
106, div. E, title LVI, Sec. 5606, Feb. 10, 1996, 110 Stat. 700; Pub. L. 
104-287, Sec. 5(9), Oct. 11, 1996, 110 Stat. 3389.)

                                          Historical and Revision Notes
----------------------------------------------------------------------------------------------------------------
           Revised  Section                    Source (U.S. Code)               Source (Statutes at Large)
----------------------------------------------------------------------------------------------------------------
40112(a)..............................  49 App.:1344(f)(1) (words        Aug. 23, 1958, Pub. L. 85-726, Sec.
                                         before 4th comma), (6), (7)      303(f), 72 Stat. 747; May 21, 1970,
                                         (1st sentence).                  Pub. L. 91-258, Sec.  51(a)(1), 84
                                                                          Stat. 234; July 12, 1976, Pub. L. 94-
                                                                          353, Sec.  16, 90 Stat. 882; Oct. 19,
                                                                          1980, Pub. L. 96-470, Sec.  112(e), 94
                                                                          Stat. 2240; Jan. 12, 1983, Pub. L. 97-
                                                                          449, Sec.  7(b), 96 Stat. 2444;
                                                                          restated Nov. 5, 1990, Pub. L. 101-
                                                                          508, Sec.  9118(a), 104 Stat. 1388-
                                                                          367.
40112(b)..............................  49 App.:1344(f)(1) (words after
                                         4th comma).
40112(c)..............................  49 App.:1344(f)(2).
40112(d) (1)(A).......................  49 App.:1344(f)(4) (words
                                         before 3d comma).
40112(d) (1)(B).......................  49 App.:1344(f)(7) (last
                                         sentence words before ``and
                                         (if'').
40112(d) (1)(C).......................  49 App.:1344(f)(8).
40112(d)(2)...........................  49 App.:1344(f)(4) (words after
                                         3d comma).
40112(e)(1)...........................  49 App.:1344(f)(7) (last
                                         sentence words after ``of
                                         funds'').
40112(e)(2)...........................  49 App.:1344(f)(3).
40112(f)..............................  49 App.:1344(f)(5).
----------------------------------------------------------------------------------------------------------------

    In this section, the word ``Administrator'' in section 303(f) of the 
Federal Aviation Act of 1958 (Public Law 85-726, 72 Stat. 747) is 
retained on authority of 49:106(g).
    In subsection (a), the reference in 49 App.:1344(f)(7) to a contract 
for the purchase of services is omitted as surplus because 49 
App.:1344(f)(1) states that the subsection is concerned only with 
contracts for the purchase of property.
    In subsection (b)(5), the word ``savings'' is substituted for ``cost 
avoidance'' for clarity.
    In subsection (c), before clause (1), the word ``both'' is omitted 
as surplus. In clause (1)(A), the words ``in such a manner as'' and 
``companies that are'' are omitted as surplus. In clause (1)(B), the 
words ``accruing on'' are substituted for ``under'' for clarity. The 
words ``subcontractor'' and ``contract'' are substituted for 
``subcontract'' and ``contractor'', respectively, to correct errors in 
the source provisions being restated.
    In subsection (d)(1)(B), the words ``after the first year'' are 
substituted for ``during the second and subsequent years of the 
contract'' to eliminate unnecessary words.
    In subsection (e)(2), the words ``a clause setting forth'' are 
omitted as surplus.
    In subsection (f), the words ``canceled or'' and ``cancellation or'' 
are omitted as being included in ``ended'' and ``ending'', respectively.


                               Amendments

    1996--Subsec. (a). Pub. L. 104-106 struck out ``or a contract to 
purchase property to which section 111 of the Federal Property and 
Administrative Services Act of 1949 (40 U.S.C. 759) applies'' after 
``improvement to real property''.
    Subsec. (e)(2). Pub. L. 104-287 substituted ``Transportation and 
Infrastructure'' for ``Public Works and Transportation''.


                    Effective Date of 1996 Amendment

    Amendment by Pub. L. 104-106 effective 180 days after Feb. 10, 1996, 
see section 5701 of Pub. L. 104-106, Feb. 10, 1996, 110 Stat. 702.