1996 US Code
Title 10 - ARMED FORCES
Subtitle A - General Military Law
PART IV - SERVICE, SUPPLY, AND PROCUREMENT
CHAPTER 137 - PROCUREMENT GENERALLY
Sec. 2302 - Definitions

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§2302. Definitions

In this chapter:

(1) The term “head of an agency” means the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, the Secretary of the Air Force, the Secretary of Transportation, and the Administrator of the National Aeronautics and Space Administration.

(2) The term “competitive procedures” means procedures under which the head of an agency enters into a contract pursuant to full and open competition. Such term also includes—

(A) procurement of architectural or engineering services conducted in accordance with title IX of the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 541 et seq.);

(B) the competitive selection for award of basic research proposals resulting from a general solicitation and the peer review or scientific review (as appropriate) of such proposals;

(C) the procedures established by the Administrator of General Services for the multiple award schedule program of the General Services Administration if—

(i) participation in the program has been open to all responsible sources; and

(ii) orders and contracts under such program result in the lowest overall cost alternative to meet the needs of the United States;

(D) procurements conducted in furtherance of section 15 of the Small Business Act (15 U.S.C. 644) as long as all responsible business concerns that are entitled to submit offers for such procurements are permitted to compete; and

(E) a competitive selection of research proposals resulting from a general solicitation and peer review or scientific review (as appropriate) solicited pursuant to section 9 of the Small Business Act (15 U.S.C. 638).

(3) The following terms have the meanings provided such terms in section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403):

(A) The term “procurement”.

(B) The term “procurement system”.

(C) The term “standards”.

(D) The term “full and open competition”.

(E) The term “responsible source”.

(F) The term “item”.

(G) The term “item of supply”.

(H) The term “supplies”.

(I) The term “commercial item”.

(J) The term “nondevelopmental item”.

(K) The term “commercial component”.

(L) The term “component”.

(4) The term “technical data” means recorded information (regardless of the form or method of the recording) of a scientific or technical nature (including computer software documentation) relating to supplies procured by an agency. Such term does not include computer software or financial, administrative, cost or pricing, or management data or other information incidental to contract administration.

(5) The term “major system” means a combination of elements that will function together to produce the capabilities required to fulfill a mission need. The elements may include hardware, equipment, software or any combination thereof, but excludes construction or other improvements to real property. A system shall be considered a major system if (A) the conditions of section 2302d of this title are satisfied, or (B) the system is designated a “major system” by the head of the agency responsible for the system.

(6) The term “Federal Acquisition Regulation” means the Federal Acquisition Regulation issued pursuant to section 25(c)(1) of the Office of Federal Procurement Policy Act (41 U.S.C. 421(c)(1)).

(7)(A) The term “simplified acquisition threshold” has the meaning provided that term in section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403), except that, in the case of any contract to be awarded and performed, or purchase to be made, outside the United States in support of a contingency operation or a humanitarian or peacekeeping operation, the term means an amount equal to two times the amount specified for that term in section 4 of such Act.

(B) In subparagraph (A), the term “humanitarian or peacekeeping operation” means a military operation in support of the provision of humanitarian or foreign disaster assistance or in support of a peacekeeping operation under chapter VI or VII of the Charter of the United Nations. The term does not include routine training, force rotation, or stationing.

(Aug. 10, 1956, ch. 1041, 70A Stat. 127; July 29, 1958, Pub. L. 85–568, title III, §301(b), 72 Stat. 432; Sept. 2, 1958, Pub. L. 85–861, §1(43A), 72 Stat. 1457; Dec. 12, 1980, Pub. L. 96–513, title V, §511(74), 94 Stat. 2926; July 18, 1984, Pub. L. 98–369, div. B, title VII, §2722(a), 98 Stat. 1186; Oct. 19, 1984, Pub. L. 98–525, title XII, §1211, 98 Stat. 2589; Oct. 30, 1984, Pub. L. 98–577, title V, §504(b)(3), 98 Stat. 3087; Nov. 14, 1986, Pub. L. 99–661, div. A, title XIII, §1343(a)(13), 100 Stat. 3993; Apr. 21, 1987, Pub. L. 100–26, §7(k)(2), 101 Stat. 284; Nov. 29, 1989, Pub. L. 101–189, div. A, title VIII, §853(b)(1), 103 Stat. 1518; Apr. 6, 1991, Pub. L. 102–25, title VII, §701(d)(1), 105 Stat. 113; Dec. 5, 1991, Pub. L. 102–190, div. A, title VIII, §805, 105 Stat. 1417; Oct. 13, 1994, Pub. L. 103–355, title I, §1502, 108 Stat. 3296; Feb. 10, 1996, Pub. L. 104–106, div. D, title XLIII, §4321(b)(3), 110 Stat. 672; Sept. 23, 1996, Pub. L. 104–201, div. A, title VIII, §§805(a)(1), 807(a), 110 Stat. 2605, 2606.)

Historical and Revision Notes
1956 Act

Revised section	Source (U.S. Code)	Source (Statutes at Large)
2302	41:158 (less clause (b)).	Feb. 19, 1948, ch. 65, §9 (less clause (b)), 62 Stat. 24.

In clause (1), the words “(if any)” are omitted as surplusage. The words “Secretary of the Treasury” are substituted for the words “Commandant, United States Coast Guard, Treasury Department”, since the functions of the Coast Guard and its officers, while operating under the Department of the Treasury, were vested in the Secretary of the Treasury by 1950 Reorganization Plan No. 26, effective July 31, 1950, 64 Stat. 1280. Under that plan the Secretary of the Treasury was authorized to delegate any of those functions to the agencies and employees of the Department of the Treasury.

Clauses (2) and (3) are inserted for clarity, and are based on the usage of those terms throughout the revised chapter.

1958 Act

Revised section	Source (U.S. Code)	Source (Statutes at Large)
2302(3)	[No source].	[No source].

The amendments reflect section 1(44) of the bill [amending section 2305 of Title 10].

References in Text

The Federal Property and Administrative Services Act of 1949, referred to in par. (2)(A), is act June 30, 1949, ch. 288, 63 Stat. 377, as amended. Title IX of the Federal Property and Administrative Services Act is classified generally to subchapter VI (§541 et seq.) of chapter 10 of Title 40, Public Buildings, Property, and Works. For complete classification of this Act to the Code, see Short Title note set out under section 471 of Title 40 and Tables.

Amendments

1996—Par. (3)(K). Pub. L. 104–106 inserted period at end.

Par. (5). Pub. L. 104–201, §805(a)(1), substituted “A system shall be considered a major system if (A) the conditions of section 2302d of this title are satisfied, or (B) the system is designated a ‘major system’ by the head of the agency responsible for the system.” for “A system shall be considered a major system if (A) the Department of Defense is responsible for the system and the total expenditures for research, development, test, and evaluation for the system are estimated to be more than ,000,000 (based on fiscal year 1980 constant dollars) or the eventual total expenditure for procurement of more than 0,000,000 (based on fiscal year 1980 constant dollars); (B) a civilian agency is responsible for the system and total expenditures for the system are estimated to exceed 0,000 (based on fiscal year 1980 constant dollars) or the dollar threshold for a ‘major system’ established by the agency pursuant to Office of Management and Budget (OMB) Circular A–109, entitled ‘Major Systems Acquisitions’, whichever is greater; or (C) the system is designated a ‘major system’ by the head of the agency responsible for the system.”

Par. (7). Pub. L. 104–201, §807(a), designated existing provisions as subpar. (A), inserted “or a humanitarian or peacekeeping operation” after “contingency operation”, and added subpar. (B).

1994—Par. (3). Pub. L. 103–355, §1502(1), added par. (3) and struck out former par. (3) which read as follows: “The terms ‘full and open competition’ and ‘responsible source’ have the same meanings provided such terms in section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403).”

Par. (7). Pub. L. 103–355, §1502(2), added par. (7) and struck out former par. (7) which read as follows: “The term ‘small purchase threshold’ has the meaning given that term in section 4(11) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(11)), except that, in the case of any contract to be awarded and performed, or purchase to be made, outside the United States in support of a contingency operation, the term means 0,000.”

1991—Par. (7). Pub. L. 102–190 inserted before period “, except that, in the case of any contract to be awarded and performed, or purchase to be made, outside the United States in support of a contingency operation, the term means 0,000”.

Pub. L. 102–25 added par. (7).

1989—Par. (6). Pub. L. 101–189 added par. (6).

1987—Pub. L. 100–26, §7(k)(2)(A), inserted “The term” after each par. designation except par. (3) and struck out uppercase letter of first word after first quotation marks in each par. and substituted lowercase letter.

1986—Par. (2)(A). Pub. L. 99–661 substituted “(40 U.S.C.” for “(41 U.S.C.”.

1984—Pub. L. 98–369 amended section generally, substituting in cl. (1) “the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, the Secretary of the Air Force” for “the Secretary, the Under Secretary, or any Assistant Secretary, of the Army, Navy, or Air Force”, in cl. (2) definition of “competitive procedures” for a definition of “negotiate”, and in cl. (3) definition of the terms “full and open competition” and “responsible source” for a definition of “formal advertising”.

Cl. (2)(D), (E). Pub. L. 98–577 added subpars. (D) and (E).

Cls. (4), (5). Pub. L. 98–525 added cls. (4) and (5).

1980—Cl. (1). Pub. L. 96–513 substituted “Secretary of Transportation” for “Secretary of the Treasury”.

1958—Cl. (1). Pub. L. 85–568 substituted “Administrator of the National Aeronautics and Space Administration” for “Executive Secretary of the National Advisory Committee for Aeronautics”, in cl. (1).

Cl. (3). Pub. L. 85–861 substituted “section 2305 of this title” for “section 2305(a) and (b) of this title”.

Effective Date of 1996 Amendment

For effective date and applicability of amendment by Pub. L. 104–106, see section 4401 of Pub. L. 104–106, set out as a note under section 251 of Title 41, Public Contracts.

Effective Date of 1994 Amendment

For effective date and applicability of amendment by Pub. L. 103–355, see section 10001 of Pub. L. 103–355, set out as a note under section 251 of Title 41, Public Contracts.

Effective Date of 1984 Amendment

Amendment by Pub. L. 98–369 applicable with respect to any solicitation for bids or proposals issued after Mar. 31, 1985, see section 2751 of Pub. L. 98–369, set out as a note under section 251 of Title 41, Public Contracts.

Effective Date of 1980 Amendment

Amendment by Pub. L. 96–513 effective Dec. 12, 1980, see section 701(b)(3) of Pub. L. 96–513, set out as a note under section 101 of this title.

Effective Date of 1958 Amendment

Section 301(e) of Pub. L. 85–568 provided that: “This section [amending this section, section 2303 of this title, section 22–1 of former Title 5, and sections 511 to 513 and 515 of Title 50, War and National Defense, and enacting provisions set out as a note under section 2472 of Title 42, The Public Health and Welfare] shall take effect ninety days after the date of the enactment of this Act [July 29, 1958], or on any earlier date on which the Administrator [of the National Aeronautics and Space Administration] shall determine, and announce by proclamation published in the Federal Register, that the Administration has been organized and is prepared to discharge the duties and exercise the powers conferred upon it by this Act.”

Short Title of 1986 Amendment

Section 101(c) [title X, §900] of Pub. L. 99–500 and Pub. L. 99–591, and section 900 of title IX of division A of Pub. L. 99–661, renumbered title IX, Pub. L. 100–26, §3(5), Apr. 21, 1987, 101 Stat. 273, provided that: “This title [enacting sections 133a, 2306a, 2325–2328, 2365–2367, 2397b, 2397c, 2408, 2409, 2416, and 2435–2437 of this title, amending sections 133, 134, 135, 138, 171, 1622, 2301, 2304, 2305, 2306, 2320, 2321, 2323, 2384, 2406, 2411, 2413, 2432, and 2433 of this title, sections 5314 and 5315 of Title 5, Government Organization and Employees, sections 632, 637, and 644 of Title 15, Commerce and Trade, and section 416 of Title 41, Public Contracts, renumbering section 2416 as 2417 of this title, enacting provisions set out as notes under sections 113, 1621, 2304, 2305, 2306a, 2320, 2323, 2325–2328, 2365–2367, 2384, 2397b, 2406, 2408, 2409, 2416, 2432, 2435–2437 of this title and section 632 of Title 15, amending provisions set out as a note under this section, and repealing provisions set out as notes under section 2304 and 2397a of this title] may be cited as the ‘Defense Acquisition Improvement Act of 1986’.”

Short Title of 1985 Amendment

Pub. L. 99–145, title IX, §901, Nov. 8, 1985, 99 Stat. 682, provided that: “This title [enacting sections 1621 to 1624, 2305a, 2324, 2397a, and 2406 of this title, amending sections 2304, 2313, 2320, 2323, 2397, and 2411 to 2415 of this title, section 759 of Title 40, Public Buildings, Property, and Works, sections 253 and 418a of Title 41, Public Contracts, and section 2168 of Title 50, Appendix, War and National Defense, enacting provisions set out as notes under this section and sections 139, 139c, 1622 to 1624, 2304, 2305a, 2307, 2324, 2397a, and 2411 of this title, section 287 of Title 18, Crimes and Criminal Procedure, section 3729 of Title 31, Money and Finance, and section 2168 of Title 50, Appendix, and amending provisions set out as a note under section 418a of Title 41] may be cited as the ‘Defense Procurement Improvement Act of 1985’.”

Short Title of 1984 Amendment

Section 1201 of title XII of Pub. L. 98–525 provided that: “This title [enacting sections 2303a, 2317 to 2323, 2384a, 2402 to 2405, and 2411 to 2416 of this title, amending sections 139a, 139b, 2302, 2305, 2311, 2384, and 2401 of this title, enacting provisions set out as notes under this section and sections 139, 139a, 2303a, 2305, 2318, 2319, 2322, 2323, 2384, 2384a, 2392, and 2402 of this title, amending provisions set out as notes under sections 2392, 2401, and 2452 of this title, and repealing provisions set out as notes under section 2304 of this title] may be cited as the ‘Defense Procurement Reform Act of 1984’.”

Year 2000 Software Conversion

Section 831 of Pub. L. 104–201 provided that:

“(a) Year 2000 Software Conversion.—The Secretary of Defense shall ensure that, as soon as practicable, all information technology acquired by the Department of Defense pursuant to contracts entered into after September 30, 1996, has the capabilities to process date and date-related data in 2000.

“(b) Assessment.—The Secretary, acting through the chief information officers within the department (as designated pursuant to section 3506 of title 44, United States Code), shall assess all information technology within the Department of Defense to determine the extent to which such technology has the capabilities to operate effectively.

“(c) Plan.—Not later than January 1, 1997, the Secretary shall submit to Congress a detailed plan for eliminating any deficiencies identified pursuant to subsection (b). The plan shall include—

“(1) a list of affected major systems;

“(2) a description of how the deficiencies could affect the national security of the United States; and

“(3) an estimate and prioritization of the resources that are necessary to eliminate the deficiencies.”

Defense Facility-Wide Pilot Program

Section 822 of Pub. L. 104–106 provided that:

“(a) Authority To Conduct Defense Facility-Wide Pilot Program.—The Secretary of Defense may conduct a pilot program, to be known as the ‘defense facility-wide pilot program’, for the purpose of determining the potential for increasing the efficiency and effectiveness of the acquisition process in facilities by using commercial practices on a facility-wide basis.

“(b) Designation of Participating Facilities.—(1) Subject to paragraph (2), the Secretary may designate up to two facilities as participants in the defense facility-wide pilot program.

“(2) The Secretary may designate for participation in the pilot program only those facilities that are authorized to be so designated in a law authorizing appropriations for national defense programs that is enacted after the date of the enactment of this Act [Feb. 10, 1996].

“(c) Scope of Program.—At a facility designated as a participant in the pilot program, the pilot program shall consist of the following:

“(1) All contracts and subcontracts for defense supplies and services that are performed at the facility.

“(2) All Department of Defense contracts and all subcontracts under Department of Defense contracts performed elsewhere that the Secretary determines are directly and substantially related to the production of defense supplies and services at the facility and are necessary for the pilot program.

“(d) Criteria for Designation of Participating Facilities.—The Secretary shall establish criteria for selecting a facility for designation as a participant in the pilot program. In developing such criteria, the Secretary shall consider the following:

“(1) The number of existing and anticipated contracts and subcontracts performed at the facility—

“(A) for which contractors are required to provide certified cost or pricing data pursuant to section 2306a of title 10, United States Code; and

“(B) which are administered with the application of cost accounting standards under section 26(f) of the Office of Federal Procurement Policy Act (41 U.S.C. 422(f)).

“(2) The relationship of the facility to other organizations and facilities performing under contracts with the Department of Defense and subcontracts under such contracts.

“(3) The impact that the participation of the facility under the pilot program would have on competing domestic manufacturers.

“(4) Such other factors as the Secretary considers appropriate.

“(e) Notification.—(1) The Secretary shall transmit to the Committee on Armed Services of the Senate and the Committee on National Security of the House of Representatives a written notification of each facility proposed to be designated by the Secretary for participation in the pilot program.

“(2) The Secretary shall include in the notification regarding a facility designated for participation in the program a management plan addressing the following:

“(A) The proposed treatment of research and development contracts or subcontracts to be performed at the facility during the pilot program.

“(B) The proposed treatment of the cost impact of the use of commercial practices on the award and administration of contracts and subcontracts performed at the facility.

“(C) The proposed method for reimbursing the contractor for existing and new contracts.

“(D) The proposed method for measuring the performance of the facility for meeting the management goals of the Secretary.

“(E) Estimates of the annual amount and the total amount of the contracts and subcontracts covered under the pilot program.

“(3)(A) The Secretary shall ensure that the management plan for a facility provides for attainment of the following objectives:

“(i) A significant reduction of the cost to the Government for programs carried out at the facility.

“(ii) A reduction of the schedule associated with programs carried out at the facility.

“(iii) An increased use of commercial practices and procedures for programs carried out at the facility.

“(iv) Protection of a domestic manufacturer competing for contracts at such facility from being placed at a significant competitive disadvantage by the participation of the facility in the pilot program.

“(B) The management plan for a facility shall also require that all or substantially all of the contracts to be awarded and performed at the facility after the designation of that facility under subsection (b), and all or substantially all of the subcontracts to be awarded under those contracts and performed at the facility after the designation, be—

“(i) for the production of supplies or services on a firm-fixed price basis;

“(ii) awarded without requiring the contractors or subcontractors to provide certified cost or pricing data pursuant to section 2306a of title 10, United States Code; and

“(iii) awarded and administered without the application of cost accounting standards under section 26(f) of the Office of Federal Procurement Policy Act (41 U.S.C. 422(f)).

“(f) Exemption From Certain Requirements.—In the case of a contract or subcontract that is to be performed at a facility designated for participation in the defense facility-wide pilot program and that is subject to section 2306a of title 10, United States Code, or section 26(f) of the Office of Federal Procurement Policy Act (41 U.S.C. 422(f)), the Secretary of Defense may exempt such contract or subcontract from the requirement to obtain certified cost or pricing data under such section 2306a or the requirement to apply mandatory cost accounting standards under such section 26(f) if the Secretary determines that the contract or subcontract—

“(1) is within the scope of the pilot program (as described in subsection (c)); and

“(2) is fairly and reasonably priced based on information other than certified cost and pricing data.

“(g) Special Authority.—The authority provided under subsection (a) includes authority for the Secretary of Defense—

“(1) to apply any amendment or repeal of a provision of law made in this Act [see Tables for classification] to the pilot program before the effective date of such amendment or repeal; and

“(2) to apply to a procurement of items other than commercial items under such program—

“(A) the authority provided in section 34 of the Office of Federal Procurement Policy Act (41 U.S.C. 430) to waive a provision of law in the case of commercial items, and

“(B) any exception applicable under this Act or the Federal Acquisition Streamlining Act of 1994 (Public Law 103–355) [see Tables for classification] (or an amendment made by a provision of either Act) in the case of commercial items,

before the effective date of such provision (or amendment) to the extent that the Secretary determines necessary to test the application of such waiver or exception to procurements of items other than commercial items.

“(h) Applicability.—(1) Subsections (f) and (g) apply to the following contracts, if such contracts are within the scope of the pilot program at a facility designated for the pilot program under subsection (b):

“(A) A contract that is awarded or modified during the period described in paragraph (2).

“(B) A contract that is awarded before the beginning of such period, that is to be performed (or may be performed), in whole or in part, during such period, and that may be modified as appropriate at no cost to the Government.

“(2) The period referred to in paragraph (1), with respect to a facility designated under subsection (b), is the period that—

“(A) begins 45 days after the date of the enactment of the Act authorizing the designation of that facility in accordance with paragraph (2) of such subsection; and

“(B) ends on September 30, 2000.

“(i) Commercial Practices Encouraged.—With respect to contracts and subcontracts within the scope of the defense facility-wide pilot program, the Secretary of Defense may, to the extent the Secretary determines appropriate and in accordance with applicable law, adopt commercial practices in the administration of contracts and subcontracts. Such commercial practices may include the following:

“(1) Substitution of commercial oversight and inspection procedures for Government audit and access to records.

“(2) Incorporation of commercial oversight, inspection, and acceptance procedures.

“(3) Use of alternative dispute resolution techniques (including arbitration).

“(4) Elimination of contract provisions authorizing the Government to make unilateral changes to contracts.”

Elimination of Use of Class I Ozone-Depleting Substances in Certain Military Procurement Contracts

Section 326 of Pub. L. 102–484, as amended by Pub. L. 104–106, div. A, title XV, §§1502(c)(2)(A), 1504(c)(1), Feb. 10, 1996, 110 Stat. 506, 514, provided that:

“(a) Elimination of Use of Class I Ozone-Depleting Substances.—(1) No Department of Defense contract awarded after June 1, 1993, may include a specification or standard that requires the use of a class I ozone-depleting substance or that can be met only through the use of such a substance unless the inclusion of the specification or standard in the contract is approved by the senior acquisition official for the procurement covered by the contract. The senior acquisition official may grant the approval only if the senior acquisition official determines (based upon the certification of an appropriate technical representative of the official) that a suitable substitute for the class I ozone-depleting substance is not currently available.

“(2)(A)(i) Not later than 60 days after the completion of the first modification, amendment, or extension after June 1, 1993, of a contract referred to in clause (ii), the senior acquisition official (or the designee of that official) shall carry out an evaluation of the contract in order to determine—

“(I) whether the contract includes a specification or standard that requires the use of a class I ozone-depleting substance or can be met only through the use of such a substance; and

“(II) in the event of a determination that the contract includes such a specification or standard, whether the contract can be carried out through the use of an economically feasible substitute for the ozone-depleting substance or through the use of an economically feasible alternative technology for a technology involving the use of the ozone-depleting substance.

“(ii) A contract referred to in clause (i) is any contract in an amount in excess of ,000,000 that—

“(I) was awarded before June 1, 1993; and

“(II) as a result of the modification, amendment, or extension described in clause (i), will expire more than 1 year after the effective date of the modification, amendment, or extension.

“(iii) A contract under evaluation under clause (i) may not be further modified, amended, or extended until the evaluation described in that clause is complete.

“(B) If the acquisition official (or designee) determines that an economically feasible substitute substance or alternative technology is available for use in a contract under evaluation, the appropriate contracting officer shall enter into negotiations to modify the contract to require the use of the substitute substance or alternative technology.

“(C) A determination that a substitute substance or technology is not available for use in a contract under evaluation shall be made in writing by the senior acquisition official (or designee).

“(D) The Secretary of Defense may, consistent with the Federal Acquisition Regulation, adjust the price of a contract modified under subparagraph (B) to take into account the use by the contractor of a substitute substance or alternative technology in the modified contract.

“(3) The senior acquisition official authorized to grant an approval under paragraph (1) and the senior acquisition official and designees authorized to carry out an evaluation and make a determination under paragraph (2) shall be determined under regulations prescribed by the Secretary of Defense. A senior acquisition official may not delegate the authority provided in paragraph (1).

“(4) Each official who grants an approval authorized under paragraph (1) or makes a determination under paragraph (2)(B) shall submit to the Secretary of Defense a report on that approval or determination, as the case may be, as follows:

“(A) Beginning on October 1, 1993, and continuing for 8 calendar quarters thereafter, by submitting a report on the approvals granted or determinations made under such authority during the preceding quarter not later than 30 days after the end of such quarter.

“(B) Beginning on January 1, 1997, and continuing for 4 years thereafter, by submitting a report on the approvals granted or determinations made under such authority during the preceding year not later than 30 days after the end of such year.

“(5) The Secretary shall promptly transmit to the Committee on Armed Services of the Senate and the Committee on National Security of the House of Representatives each report submitted to the Secretary under paragraph (4). The Secretary shall transmit the report in classified and unclassified forms.

“(b) Cost Recovery.—In any case in which a Department of Defense contract is modified or a specification or standard for such a contract is waived at the request of a contractor in order to permit the contractor to use in the performance of the contract a substitute for a class I ozone-depleting substance or an alternative technology for a technology involving the use of a class I ozone-depleting substance, the Secretary of Defense may adjust the price of the contract in a manner consistent with the Federal Acquisition Regulation.

“(c) Definitions.—In this section:

“(1) The term ‘class I ozone-depleting substance’ means any substance listed under section 602(a) of the Clean Air Act (42 U.S.C. 7671a(a)).

“(2) The term ‘Federal Acquisition Regulation’ means the single Government-wide procurement regulation issued under section 25(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 421(c)).”

Payment Protections for Subcontractors and Suppliers

Pub. L. 102–190, div. A, title VIII, §806, Dec. 5, 1991, 105 Stat. 1417, as amended by Pub. L. 102–484, div. A, title X, §1053(5), Oct. 23, 1992, 106 Stat. 2502; Pub. L. 103–355, title II, §2091, title VIII, §8105(k), Oct. 13, 1994, 108 Stat. 3306, 3393, provided that:

“(a) Regulations.—The Secretary of Defense shall prescribe in regulations the following requirements:

“(1) Information provided by department of defense relating to payment.—(A) Subject to section 552(b)(1) of title 5, United States Code, upon the request of a subcontractor or supplier of a contractor performing a Department of Defense contract, the Department of Defense shall promptly make available to such subcontractor or supplier the following information:

“(i) Whether requests for progress payments or other payments have been submitted by the contractor to the Department of Defense in connection with that contract.

“(ii) Whether final payment to the contractor has been made by the Department of Defense in connection with that contract.

“(B) This paragraph shall apply with respect to any Department of Defense contract that is in effect on the date which is 270 days after the date of enactment of this Act [Dec. 5, 1991] or that is awarded after such date.

“(2) Information provided by department of defense relating to payment bonds.—(A) Upon the request of a subcontractor or supplier described in subparagraph (B), the Department of Defense shall promptly make available to such subcontractor or supplier any of the following:

“(i) The name and address of the surety or sureties on the payment bond.

“(ii) The penal amount of the payment bond.

“(iii) A copy of the payment bond.

“(B) Subparagraph (A) applies to—

“(i) a subcontractor or supplier having a subcontract, purchase order, or other agreement to furnish labor or material for the performance of a Department of Defense contract with respect to which a payment bond has been furnished to the United States pursuant to the Miller Act; and

“(ii) a prospective subcontractor or supplier offering to furnish labor or material for the performance of such a Department of Defense contract.

“(C) With respect to the information referred to in subparagraphs (A)(i) and (A)(ii), the regulations shall include authority for such information to be provided verbally to the subcontractor or supplier.

“(D) With respect to the information referred to in subparagraph (A)(iii), the regulations may impose reasonable fees to cover the cost of copying and providing requested bonds.

“(E) This paragraph shall apply with respect to any Department of Defense contract covered by the Miller Act that is in effect on the date which is 270 days after the date of enactment of this Act [Dec. 5, 1991] or that is awarded after such date.

“(3) Information provided by contractors relating to payment bonds.—(A) Upon the request of a prospective subcontractor or supplier offering to furnish labor or material for the performance of a Department of Defense contract with respect to which a payment bond has been furnished to the United States pursuant to the Miller Act, the contractor shall promptly make available to such prospective subcontractor or supplier a copy of the payment bond.

“(B) This paragraph shall apply with respect to any Department of Defense contract covered by the Miller Act for which a solicitation is issued after the expiration of the 60-day period beginning on the effective date of the regulations promulgated under this subsection.

“(4) Procedures relating to compliance with payment terms.—(A) Under procedures established in the regulations, upon the assertion by a subcontractor or supplier of a contractor performing a Department of Defense contract that the subcontractor or supplier has not been paid by the prime contractor in accordance with the payment terms of the subcontract, purchase order, or other agreement with the prime contractor, the contracting officer may determine the following:

“(i) With respect to a construction contract, whether the contractor has made progress payments to the subcontractor or supplier in compliance with chapter 39 of title 31, United States Code.

“(ii) With respect to a contract other than a construction contract, whether the contractor has made progress or other payments to the subcontractor or supplier in compliance with the terms of the subcontract, purchase order, or other agreement with the prime contractor.

“(iii) With respect to either a construction contract or a contract other than a construction contract, whether the contractor has made final payment to the subcontractor or supplier in compliance with the terms of the subcontract, purchase order, or other agreement with the prime contractor.

“(iv) With respect to either a construction contract or a contract other than a construction contract, whether any certification of payment of the subcontractor or supplier accompanying the contractor's payment request to the Government is accurate.

“(B) If the contracting officer determines that the prime contractor is not in compliance with any matter referred to in clause (i), (ii), or (iii) of subparagraph (A), the contracting officer may, under procedures established in the regulations—

“(i) encourage the prime contractor to make timely payment to the subcontractor or supplier; or

“(ii) reduce or suspend progress payments with respect to amounts due to the prime contractor.

“(C) If the contracting officer determines that a certification referred to in clause (iv) of subparagraph (A) is inaccurate in any material respect, the contracting officer shall, under procedures established in the regulations, initiate appropriate administrative or other remedial action.

“(D) This paragraph shall apply with respect to any Department of Defense contract that is in effect on the date of promulgation of the regulations under this subsection or that is awarded after such date.

“(b) Inapplicability to Certain Contracts.—Regulations prescribed under this section shall not apply to a contract for the acquisition of commercial items (as defined in section 4(12) of the Office of Federal Procurement Policy Act [41 U.S.C. 403(12)]).

“(c) Government-Wide Applicability.—The Federal Acquisition Regulatory Council (established by section 25(a) of the Office of Federal Procurement Policy Act) shall modify the Federal Acquisition Regulation (issued pursuant to section 25(c)(1) of the Office of Federal Procurement Policy Act (41 U.S.C. 421(c)(1)) to apply Government-wide the requirements that the Secretary is required under subsection (a) to prescribe in regulations applicable with respect to the Department of Defense contracts.

“(d) Assistance to Small Business Concerns.—[Amended section 15(k)(5) of the Small Business Act (15 U.S.C. 644(k)(5)).]

“(e) GAO Report.—(1) The Comptroller General of the United States shall conduct an assessment of the matters described in paragraph (2) and submit a report pursuant to paragraph (3).

“(2) In addition to such other related matters as the Comptroller General considers appropriate, the matters to be assessed pursuant to paragraph (1) are the following:

“(A) Timely payment of progress or other periodic payments to subcontractors and suppliers by prime contractors on Federal contracts by—

“(i) identifying all existing statutory and regulatory provisions, categorized by types of contracts covered by such provisions;

“(ii) evaluating the feasibility and desirability of requiring that a prime contractor (other than a construction prime contractor subject to the provisions of sections 3903(b) and 3905 of title 31, United States Code) be required to—

“(I) include in its subcontracts a payment term requiring payment within 7 days (or some other fixed term) after receiving payment from the Government; and

“(II) submit with its payment request to the Government a certification that it has timely paid its subcontractors in accordance with their subcontracts from funds previously received as progress payments and will timely make required payments to such subcontractors from the proceeds of the progress payment covered by the certification;

“(iii) evaluating the feasibility and desirability of requiring that all prime contractors (other than a construction prime contractor subject to the provisions of sections 3903(b) and 3905 of title 31, United States Code) furnish with its payment request to the Government proof of payment of the amounts included in such payment request for payments made to subcontractors and suppliers;

“(iv) evaluating the feasibility and desirability of requiring a prime contractor to establish an escrow account at a federally insured financial institution and requiring direct disbursements to subcontractors and suppliers of amounts certified by the prime contractor in its payment request to the Government as being payable to such subcontractors and suppliers in accordance with their subcontracts; and

“(v) evaluating the feasibility and desirability of requiring direct disbursement of amounts certified by a prime contractor as being payable to its subcontractors and suppliers in accordance with their subcontracts (using techniques such as joint payee checks, escrow accounts, or direct payment by the Government), if the contracting officer has determined that the prime contractor is failing to make timely payments to its subcontractors and suppliers.

“(B) Payment protection of subcontractors and suppliers through the use of payment bonds or alternatives methods by—

“(i) evaluating the effectiveness of the modifications to part 28.2 of the Federal Acquisition Regulation Part 28.2 (48 C.F.R. 28.200) relating to the use of individual sureties, which became effective February 26, 1990;

“(ii) evaluating the effectiveness of requiring payment bonds pursuant to the Miller Act as a means of affording protection to construction subcontractors and suppliers relating to receiving—

“(I) timely payment of progress payments due in accordance with their subcontracts; and

“(II) ultimate payment of such amounts due;

“(iii) evaluating the feasibility and desirability of increasing the payment bond amounts required under the Miller Act from the current maximum amounts to an amount equal to 100 percent of the amount of the contract;

“(iv) evaluating the feasibility and desirability of requiring payment bonds for supply and services contracts (other than construction), and, if feasible and desirable, the amounts of such bonds; and

“(v) evaluating the feasibility and desirability of using letters of credit issued by federally insured financial institutions (or other alternatives) as substitutes for payment bonds in providing payment protection to subcontractors and suppliers on construction contracts (and other contracts).

“(C) Any evaluation of feasibility and desirability carried out pursuant to subparagraph (A) or (B) shall include the appropriateness of—

“(i) any differential treatment of, or impact on, small business concerns as opposed to concerns other than small business concerns;

“(ii) any differential treatment of subcontracts relating to commercial products entered into by the contractor in furtherance of its non-Government business, especially those subcontracts entered into prior to the award of a contract by the Government; and

“(iii) extending the protections regarding payment to all tiers of subcontractors or restricting them to first-tier subcontractors and direct suppliers.

“(3) The report required by paragraph (1) shall include a description of the results of the assessment carried out pursuant to paragraph (2) and may include recommendations pertaining to any of the following:

“(A) Statutory and regulatory changes providing payment protections for subcontractors and suppliers (other than a construction prime contractor subject to the provisions of sections 3903(b) and 3905 of title 31, United States Code) that the Comptroller General believes to be desirable and feasible.

“(B) Proposals to assess the desirability and utility of a specific payment protection on a test basis.

“(C) Such other recommendations as the Comptroller General considers appropriate in light of the matters assessed pursuant to paragraph (2).

“(4) The report required by paragraph (1) shall be submitted not later than by February 1, 1993, to the Committees on Armed Services and on Small Business of the Senate and House of Representatives.

“(f) Inspector General Report.—(1) The Inspector General of the Department of Defense shall submit to the Secretary of Defense a report on payment protections for subcontractors and suppliers under contracts entered into with the Department of Defense. The report shall include an assessment of the extent to which available judicial and administrative remedies, as well as suspension and debarment procedures, have been used (or recommended for use) by officials of the Department to deter false statements relating to (A) payment bonds provided by individuals pursuant to the Miller Act, and (B) certifications pertaining to payment requests by construction contractors pursuant to section 3903(b) of title 31, United States Code. The assessment shall cover actions taken during the period beginning on October 1, 1989, and ending on September 30, 1992.

“(2) The report required by paragraph (1) shall be submitted to the Secretary of Defense not later than March 1, 1993. The report may include recommendations by the Inspector General on ways to improve the effectiveness of existing methods of preventing false statements.

“(g) Miller Act Defined.—For purposes of this section, the term ‘Miller Act’ means the Act of August 24, 1935 (40 U.S.C. 270a–270d) [40 U.S.C. 270a to 270d–1].”

Advisory Panel on Streamlining and Codifying Acquisition Laws

Pub. L. 101–510, div. A, title VIII, §800, Nov. 5, 1990, 104 Stat. 1587, as amended by Pub. L. 103–160, div. A, title IX, §904(f), Nov. 30, 1993, 107 Stat. 1729, directed Under Secretary of Defense for Acquisition and Technology, not later than Jan. 15, 1991, to establish under sponsorship of Defense Systems Management College an advisory panel on streamlining and codifying acquisition laws, to review the acquisition laws applicable to Department of Defense with a view toward streamlining the defense acquisition process, to make any recommendations for repeal or amendment of such laws that the panel considers necessary, as a result of such review, and to prepare a proposed code of relevant acquisition laws, directed the advisory panel, not later than Dec. 15, 1992, to transmit a final report on the actions of the panel to the Under Secretary of Defense for Acquisition and Technology, and directed the Secretary of Defense, not later than Jan. 15, 1993, to transmit the final report, together with such comments as he deems appropriate, to Congress.

Mentor-Protege Pilot Program

Section 807(a) of Pub. L. 102–484 provided that: “Within 15 days after the date of the enactment of this Act [Oct. 23, 1992], the Secretary of Defense shall publish in the Department of Defense Supplement to the Federal Acquisition Regulation the Department of Defense policy for the pilot Mentor-Protege Program and the regulations, directives, and administrative guidance pertaining to such program as such policy, regulations, directives, and administrative guidance existed on December 6, 1991. Proposed modifications to that policy and any amendments of the matters published pursuant to the preceding sentence that are proposed in order to implement any of the amendments made by this section shall be published for public comment within 60 days after the date of the enactment of this Act and shall be published in final form within 120 days after such date.”

Pub. L. 101–510, div. A, title VIII, §831, Nov. 5, 1990, 104 Stat. 1607, as amended by Pub. L. 102–25, title VII, §704(c), Apr. 6, 1991, 105 Stat. 119; Pub. L. 102–172, title VIII, §8064A, Nov. 26, 1991, 105 Stat. 1186; Pub. L. 102–190, div. A, title VIII, §814(b), Dec. 5, 1991, 105 Stat. 1425; Pub. L. 102–484, div. A, title VIII, §§801(h)(4), 807(b)(1), title X, §1054(d), Oct. 23, 1992, 106 Stat. 2445, 2448, 2503; Pub. L. 103–160, div. A, title VIII, §813(b)(1), (c), Nov. 30, 1993, 107 Stat. 1703; Pub. L. 104–106, div. A, title VIII, §824, Feb. 10, 1996, 110 Stat. 399; Pub. L. 104–201, div. A, title VIII, §802, Sept. 23, 1996, 110 Stat. 2604, provided that:

“(a) Establishment of Pilot Program.—The Secretary of Defense shall establish a pilot program to be known as the ‘Mentor-Protege Program’.

“(b) Purpose.—The purpose of the program is to provide incentives for major Department of Defense contractors to furnish disadvantaged small business concerns with assistance designed to enhance the capabilities of disadvantaged small business concerns to perform as subcontractors and suppliers under Department of Defense contracts and other contracts and subcontracts in order to increase the participation of such business concerns as subcontractors and suppliers under Department of Defense contracts, other Federal Government contracts, and commercial contracts.

“(c) Program Participants.—(1) A business concern meeting the eligibility requirements set out in subsection (d) may enter into agreements under subsection (e) and furnish assistance to disadvantaged small business concerns upon making application to the Secretary of Defense and being approved for participation in the pilot program by the Secretary. A business concern participating in the pilot program pursuant to such an approval shall be known, for the purposes of the program, as a ‘mentor firm’.

“(2) A disadvantaged small business concern eligible for the award of Federal contracts may obtain assistance from a mentor firm upon entering into an agreement with the mentor firm as provided in subsection (e). A disadvantaged small business concern may not be a party to more than one agreement to receive such assistance at any time. A disadvantaged small business concern receiving such assistance shall be known, for the purposes of the program, as a ‘protege firm’.

“(3) In entering into an agreement pursuant to subsection (e), a mentor firm may rely in good faith on a written representation of a business concern that such business concern is a disadvantaged small business concern. The Small Business Administration shall determine the status of such business concern as a disadvantaged small business concern in the event of a protest regarding the status of such business concern. If at any time the business concern is determined by the Small Business Administration not to be a disadvantaged small business concern, assistance furnished such business concern by the mentor firm after the date of the determination may not be considered assistance furnished under the program.

“(d) Mentor Firm Eligibility.—Subject to subsection (c)(1), a mentor firm eligible for award of Federal contracts may enter into an agreement with one or more protege firms under subsection (e) and provide assistance under the program pursuant to that agreement if—

“(1) during the fiscal year preceding the fiscal year in which the mentor firm enters into the agreement, the total amount of the Department of Defense contracts awarded such mentor firm and the subcontracts awarded such mentor firm under Department of Defense contracts was equal to or greater than 0,000,000; or

“(2) the mentor firm demonstrates the capability to assist in the development of protege firms, and is approved by the Secretary of Defense pursuant to criteria specified in the regulations prescribed pursuant to subsection (k).

“(e) Mentor-Protege Agreement.—Before providing assistance to a protege firm under the program, a mentor firm shall enter into a mentor-protege agreement with the protege firm regarding the assistance to be provided by the mentor firm. The agreement shall include the following:

“(1) A developmental program for the protege firm, in such detail as may be reasonable, including (A) factors to assess the protege firm's developmental progress under the program, and (B) the anticipated number and type of subcontracts to be awarded the protege firm.

“(2) A program participation term, which shall not exceed five years and may be renewed upon its expiration for an additional term of not to exceed four years.

“(3) Procedures for the protege firm to terminate the agreement voluntarily and for the mentor firm to terminate the agreement for cause.

“(f) Forms of Assistance.—A mentor firm may provide a protege firm the following:

“(1) Assistance, by using mentor firm personnel, in—

“(A) general business management, including organizational management, financial management, and personnel management, marketing, business development, and overall business planning;

“(B) engineering and technical matters such as production, inventory control, and quality assurance; and

“(C) any other assistance designed to develop the capabilities of the protege firm under the developmental program referred to in subsection (e).

“(2) Award of subcontracts on a noncompetitive basis to the protege firm under the Department of Defense or other contracts.

“(3) Payment of progress payments for performance of the protege firm under such a subcontract in amounts as provided for in the subcontract, but in no event may any such progress payment exceed 100 percent of the costs incurred by the protege firm for the performance.

“(4) Advance payments under such subcontracts.

“(5) Loans.

“(6) Cash in exchange for an ownership interest in the protege firm, not to exceed 10 percent of the total ownership interest.

“(7) Assistance obtained by the mentor firm for the protege firm from one or more of the following—

“(A) small business development centers established pursuant to section 21 of the Small Business Act (15 U.S.C. 648);

“(B) entities providing procurement technical assistance pursuant to chapter 142 of title 10, United States Code; or

“(C) a historically Black college or university or a minority institution of higher education.

“(g) Incentives for Mentor Firms.—(1) The Secretary of Defense shall provide to a mentor firm reimbursement for the total amount of any progress payment or advance payment made under the program by the mentor firm to a protege firm in connection with a Department of Defense contract awarded the mentor firm.

“(2)(A) The Secretary of Defense shall provide to a mentor firm reimbursement for the costs of the assistance furnished to a protege firm pursuant to paragraphs (1) and (7) of subsection (f). The Secretary shall ensure that the reimbursement is provided for—

“(i) as a line item in a Department of Defense contract under which the mentor firm is furnishing products or services to the Department, subject to a maximum amount of reimbursement specified in such contract;

“(ii) as a reimbursement of indirect costs incurred under the program which have been assigned to indirect cost pools, to the extent that such assigned costs are otherwise reasonable, allocable, and allowable;

“(iii) in a separate contract, cooperative agreement, or other agreement entered into between the Secretary and the mentor firm for the purpose of providing reimbursement of costs incurred under the program, subject to a maximum amount of reimbursement specified in such contract or agreement; or

“(iv) through a combination of the methods of reimbursement described in clauses (i), (ii), and (iii), but only if the mentor firm has an accounting system and controls adequate to assure proper identification and assignment of program costs to appropriate direct and indirect cost accounts.

“(B) The Secretary and a mentor firm may provide for the allocation of such costs to any Department of Defense contract awarded to the mentor firm.

“(3)(A) Costs incurred by a mentor firm in providing assistance to a protege firm that are not reimbursed pursuant to either subparagraph (A) or (C) of paragraph (2) or are reimbursed pursuant to subparagraph (B) of such paragraph shall be recognized as credit in lieu of subcontract awards for purposes of determining whether the mentor firm attains a subcontracting participation goal applicable to such mentor firm under a Department of Defense contract, under a contract with another executive agency, or under a divisional or company-wide subcontracting plan negotiated with the Department of Defense or another executive agency.

“(B) The amount of the credit given a mentor firm for any such unreimbursed costs shall be equal to—

“(i) four times the total amount of such costs attributable to assistance provided by entities described in subsection (f)(7);

“(ii) three times the total amount of such costs attributable to assistance furnished by the mentor firm's employees; and

“(iii) two times the total amount of any other such costs.

“(C) Under regulations prescribed pursuant to subsection (k), the Secretary of Defense shall adjust the amount of credit given a mentor firm pursuant to subparagraphs (A) and (B) if the Secretary determines that the firm's performance regarding the award of subcontracts to disadvantaged small business concerns has declined without justifiable cause.

“(4) A mentor firm shall receive credit toward the attainment of a subcontracting participation goal applicable to such mentor firm for each subcontract for a product or service awarded under such contract by a mentor firm to a business concern that, except for its size, would be a small business concern owned and controlled by socially and economically disadvantaged individuals, but only if—

“(A) the size of such business concern is not more than two times the maximum size specified by the Administrator of the Small Business Administration for purposes of determining whether a business concern furnishing such product or service is a small business concern; and

“(B) the business concern formerly had a mentor-protege agreement with such mentor firm that was not terminated for cause.

“(h) Relationship to Small Business Act.—(1) For purposes of the Small Business Act [15 U.S.C. 631 et seq.], no determination of affiliation or control (either direct or indirect) may be found between a protege firm and its mentor firm on the basis that the mentor firm has agreed to furnish (or has furnished) to its protege firm pursuant to a mentor-protege agreement any form of developmental assistance described in subsection (f).

“(2) Notwithstanding section 8 of the Small Business Act (15 U.S.C. 637), the Small Business Administration may not determine a disadvantaged small business concern to be ineligible to receive any assistance authorized under the Small Business Act on the basis that such business concern has participated in the Mentor-Protege Program or has received assistance pursuant to any developmental assistance agreement authorized under such program.

“(3) The Small Business Administration may not require a firm that is entering into, or has entered into, an agreement under subsection (e) as a protege firm to submit the agreement, or any other document required by the Secretary of Defense in the administration of the Mentor-Protege Program, to the Small Business Administration for review, approval, or any other purpose.

“(i) Participation in Mentor-Protege Program not To Be a Condition for Award of a Contract or Subcontract.—A mentor firm may not require a business concern to enter into an agreement with the mentor firm pursuant to subsection (e) as a condition for being awarded a contract by the mentor firm, including a subcontract under a contract awarded to the mentor firm.

“(j) Duration of Pilot Program.—(1) Business concerns eligible to participate in the program may enter into mentor-protege agreements pursuant to subsection (e) during the period commencing on October 1, 1991, and ending on September 30, 1996.

“(2) A mentor firm may not incur costs furnishing developmental assistance to a protege firm that are eligible for reimbursement pursuant to subsection (g) prior to October 1, 1991, or after September 30, 1999.

“(3) A mentor firm may receive credit toward the attainment of such firm's goals for subcontract awards to disadvantaged small business concerns for unreimbursed costs incurred in providing developmental assistance to the firm's protege firms, pursuant to subsection (g)(3), for the period beginning October 1, 1991, and ending September 30, 1999.

“(k) Regulations.—The Secretary of Defense shall prescribe regulations to carry out the pilot Mentor-Protege Program. Such regulations shall include the requirements set forth in section 8(d) of the Small Business Act (15 U.S.C. 637(d)) and shall prescribe procedures by which mentor firms may terminate participation in the program. The Secretary shall publish the proposed regulations not later than the date 180 days after the date of the enactment of this Act [Nov. 5, 1990]. The Secretary shall promulgate the final regulations not later than the date 270 days after the date of the enactment of this Act. The Department of Defense policy regarding the pilot Mentor-Protege Program shall be published and maintained as an appendix to the Department of Defense Supplement to the Federal Acquisition Regulation.

“(l) General Accounting Office Assessment.—(1) The General Accounting Office shall evaluate the implementation of the Mentor-Protege Program established pursuant to subsection (a) to determine whether the purposes of the program, as stated in subsection (b), have been attained.

“(2) A report of the evaluation conducted by the General Accounting Office pursuant to subsection (a) shall be furnished to the Committees on Armed Services and Small Business of the Senate and House of Representatives by February 1, 1994. Such report shall cover the period October 1, 1991, through September 30, 1993. Recommendations shall be included regarding reauthorization of the program, and extending its application on a Government-wide basis.

“(3) An interim report shall be furnished to the Committees on Armed Services of the Senate and House of Representatives by March 30, 1992. The interim report shall—

“(A) evaluate the regulatory implementation of the program by the Department of Defense;

“(B) assess initial participation by firms eligible to be mentor firms or protege firms;

“(C) identify deficiencies, if any, in the statutory or regulatory framework of the program likely to impair the success of the program; and

“(D) make recommendations to correct any implementational impediments identified.

“(m) Definitions.—In this section:

“(1) The term ‘small business concern’ means a business concern that meets the requirements of section 3(a) of the Small Business Act (15 U.S.C. 632(a)) and the regulations promulgated pursuant thereto.

“(2) The term ‘disadvantaged small business concern’ means:

“(A) a small business concern owned and controlled by socially and economically disadvantaged individuals;

“(B) a business entity owned and controlled by an Indian tribe as defined by section 8(a)(13) of the Small Business Act (15 U.S.C. 637(a)(13));

“(C) a business entity owned and controlled by a Native Hawaiian Organization as defined by section 8(a)(15) of the Small Business Act (15 U.S.C. 637(a)(15)); or

“(D) a qualified organization employing the severely disabled.

“(3) The term ‘small business concern owned and controlled by socially and economically disadvantaged individuals’ has the meaning given such term in section 8(d)(3)(C) of the Small Business Act (15 U.S.C. 637(d)(3)(C)).

“(4) The term ‘historically Black college and university’ means any of the historically Black colleges and universities referred to in section 2323 of title 10, United States Code.

“(5) The term ‘minority institution of higher education’ means an institution of higher education with a student body that reflects the composition specified in section 312(b)(3), (4), and (5) of the Higher Education Act of 1965 (20 U.S.C. 1058(b)(3), (4), and (5)).

“(6) The term ‘subcontracting participation goal’, with respect to a Department of Defense contract, means a goal for the extent of the participation by disadvantaged small business concerns in the subcontracts awarded under such contract, as established pursuant to section 2323 of title 10, United States Code, and section 8(d) of the Small Business Act (15 U.S.C. 637(d)).

“(7) The term ‘qualified organization employing the severely disabled’ means a business entity operated on a for-profit or nonprofit basis that—

“(A) uses rehabilitative engineering to provide employment opportunities for severely disabled individuals and integrates severely disabled individuals into its workforce;

“(B) employs severely disabled individuals at a rate that averages not less than 20 percent of its total workforce;

“(C) employs each severely disabled individual in its workforce generally on the basis of 40 hours per week; and

“(D) pays not less than the minimum wage prescribed pursuant to section 6 of the Fair Labor Standards Act (29 U.S.C. 206) to those employees who are severely disabled individuals.

“(8) The term ‘severely disabled individual’ means an individual who has a physical or mental disability which constitutes a substantial handicap to employment and which, in accordance with criteria prescribed by the Committee for the Purchase From the Blind and Other Severely Handicapped established by the first section of the Act of June 25, 1938 (41 U.S.C. 46; popularly known as the ‘Wagner-O'Day Act’) [now known as the “Javits-Wagner-O'Day Act”], is of such a nature that the individual is otherwise prevented from engaging in normal competitive employment.

“(n) Availability of Funding.—Funds authorized and appropriated to carry out the program shall remain available until September 30, 1999.”

[Section 802(1) of Pub. L. 104–201, which directed amendment of section 831(j)(1) of Pub. L. 101–510, set out above, by substituting “1998” for “1995”, could not be executed.]

[Section 807(b)(2) of Pub. L. 102–484 provided that: “The amendment made by this subsection [amending section 831 of Pub. L. 101–510, set out above] shall take effect as of November 5, 1990.”]

Credit for Indian Contracting in Meeting Certain Minority Subcontracting Goals

Pub. L. 101–189, div. A, title VIII, §832, Nov. 29, 1989, 103 Stat. 1508, which provided credit for Indian contracting in meeting certain minority contracting goals, was repealed and restated in section 2323a of this title by Pub. L. 102–484, §801(g)(1)(B), (h)(5).

Equitable Participation of American Small and Minority-Owned Business in Furnishing of Commodities and Services

Pub. L. 101–165, title IX, §9004, Nov. 21, 1989, 103 Stat. 1129, provided that: “During the current fiscal year and hereafter, the Secretary of Defense and each purchasing and contracting agency of the Department of Defense shall assist American small and minority-owned business to participate equitably in the furnishing of commodities and services financed with funds appropriated under this Act [see Tables for classification] by increasing, to an optimum level, the resources and number of personnel jointly assigned to promoting both small and minority business involvement in purchases financed with funds appropriated herein, and by making available or causing to be made available to such businesses, information, as far in advance as possible, with respect to purchases proposed to be financed with funds appropriated under this Act, and by assisting small and minority business concerns to participate equitably as subcontractors on contracts financed with funds appropriated herein, and by otherwise advocating and providing small and minority business opportunities to participate in the furnishing of commodities and services financed with funds appropriated by this Act.”

Requirement for Substantial Progress on Minority and Small Business Contract Awards

Pub. L. 100–180, div. A, title VIII, §806(a)–(c), Dec. 4, 1987, 101 Stat. 1126, 1127, directed Secretary of Defense to issue regulations to ensure that substantial progress was made in increasing awards of Department of Defense contracts to small business concerns, historically Black colleges and universities, and minority institutions described in section 1207(a) of Pub. L. 99–661 [formerly set out below], prior to repeal by Pub. L. 102–484, div. A, title VIII, §801(h)(7), Oct. 23, 1992, 106 Stat. 2446.

Definitions; Rule of Construction for Duplicate Authorization and Appropriation Provisions of Public Laws 99–500, 99–591, and 99–661

Pub. L. 100–26, §§2, 6, Apr. 21, 1987, 101 Stat. 273, 274, provided that:

“SEC. 2. REFERENCES TO 99TH CONGRESS LAWS

“For purposes of this Act [Pub. L. 100–26, see Short Title of 1987 Amendment note set out under section 101 of this title]:

“(1) The term ‘Defense Authorization Act’ means the Department of Defense Authorization Act, 1987 (division A of Public Law 99–661; 100 Stat. 3816 et seq.).

“(2) The term ‘Defense Appropriations Act’ means the Department of Defense Appropriations Act, 1987 (as contained in identical form in section 101(c) of Public Law 99–500 (100 Stat. 1783–82 et seq.) and section 101(c) of Public Law 99–591 (100 Stat. 3341–82 et seq.)).

“(3) The term ‘Defense Acquisition Improvement Act’ means title X of the Defense Appropriations Act [100 Stat. 1783–130, 3341–130] and title IX of the Defense Authorization Act [100 Stat. 3910] (as designated by the amendment made by section 3(5) [section 3(5) of Pub. L. 100–26]). Any reference in this Act to the Defense Acquisition Improvement Act shall be considered to be a reference to each such title.”

“SEC. 6. CONSTRUCTION OF DUPLICATE AUTHORIZATION AND APPROPRIATION PROVISIONS

“(a) Rule for Construction of Duplicate Provisions.—(1) In applying the provisions of Public Laws 99–500, 99–591, and 99–661 described in paragraph (2)—

“(A) the identical provisions of those public laws referred to in such paragraph shall be treated as having been enacted only once, and

“(B) in executing to the United States Code and other statutes of the United States the amendments made by such identical provisions, such amendments shall be executed so as to appear only once in the law as amended.

“(2) Paragraph (1) applies with respect to the provisions of the Defense Appropriations Act and the Defense Authorization Act (as amended by sections 3, 4, 5, and 10(a)) referred to across from each other in the following table:

“Section 101(c) of Public Law 99–500	Section 101(c) of Public Law 99–591	Division A of Public Law 99–661
“Title X	Title X	Title IX
“Sec. 9122	Sec. 9122	Sec. 522
“Sec. 9036(b)	Sec. 9036(b)	Sec. 1203
“Sec. 9115	Sec. 9115	Sec. 1311

“(b) Rule for Date of Enactment.—(1) The date of the enactment of the provisions of law listed in the middle column, and in the right-hand column, of the table in subsection (a)(2) shall be deemed to be October 18, 1986 (the date of the enactment of Public Law 99–500).

“(2) Any reference in a provision of law referred to in paragraph (1) to ‘the date of the enactment of this Act’ shall be treated as a reference to October 18, 1986.”

[For classification of provisions listed in the table, see Tables.]

Contract Goal for Minorities

Section 1207 of Pub. L. 99–661, as amended by Pub. L. 100–180, div. A, title VIII, §806(d), 101 Stat. 1127; Pub. L. 100–456, div. A, title VIII, §844, Sept. 29, 1988, 102 Stat. 2027; Pub. L. 101–189, div. A, title VIII, §831, Nov. 29, 1989, 103 Stat. 1507; Pub. L. 101–510, div. A, title VIII, §§811, 832, title XIII, §§1302(d), 1312(b), Nov. 5, 1990, 104 Stat. 1596, 1612, 1669, 1670; Pub. L. 102–25, title VII, §§704(a)(6), 705(e), Apr. 6, 1991, 105 Stat. 118, 120, which set contract goals for small disadvantaged businesses and certain institutions of higher education, was repealed and restated in section 2323 of this title by Pub. L. 102–484, §801(a)(1)(B), (h)(1).

Minimum Percentage of Competitive Procurements

Pub. L. 99–145, title IX, §913, Nov. 8, 1985, 99 Stat. 687, as amended by Pub. L. 101–510, div. A, title XIII, §1322(d)(1), Nov. 5, 1990, 104 Stat. 1672, provided that:

“(a) Annual Goal.—The Secretary of Defense shall establish for each fiscal year a goal for the percentage of defense procurements to be made during that year (expressed in total dollar value of contracts entered into) that are to be competitive procurements.

“(b) Definition.—For the purposes of this section, the term ‘competitive procurements’ means procurements made by the Department of Defense through the use of competitive procedures, as defined in section 2304 of title 10, United States Code.”

Defense Procurement Reform: Congressional Findings and Policy

Section 1202 of Pub. L. 98–525, as amended by Pub. L. 99–500, §101(c) [title X, §953(c)], Oct. 18, 1986, 100 Stat. 1783–82, 1783–172, and Pub. L. 99–591, §101(c) [title X, §953(c)], Oct. 30, 1986, 100 Stat. 3341–82, 3341–172; Pub. L. 99–661, div. A, title IX, formerly title IV, §953(c), Nov. 14, 1986, 100 Stat. 3952, renumbered title IX, Pub. L. 100–26, §3(5), Apr. 21, 1987, 101 Stat. 273, provided that: “The Congress finds that recent disclosures of excessive payments by the Department of Defense for replenishment parts have undermined confidence by the public and Congress in the defense procurement system. The Secretary of Defense should make every effort to reform procurement practices relating to replenishment parts. Such efforts should, among other matters, be directed to the elimination of excessive pricing of replenishment spare parts and the recovery of unjustified payments. Specifically, the Secretary should—

“(1) direct that officials in the Department of Defense refuse to enter into contracts unless the proposed prices are fair and reasonable;

“(2) continue and accelerate ongoing efforts to improve defense contracting procedures in order to encourage effective competition and assure fair and reasonable prices;

“(3) direct that replenishment parts be acquired in economic order quantities and on a multiyear basis whenever feasible, practicable, and cost effective;

“(4) direct that standard or commercial parts be used whenever such use is technically acceptable and cost effective; and

“(5) vigorously continue reexamination of policies relating to acquisition, pricing, and management of replenishment parts and of technical data related to such parts.”

Modification of Regulations and Directives To Accommodate a Policy of Multiyear Procurement

Section 909(d) of Pub. L. 97–86 directed Secretary of Defense, not later than the end of the 90-day period beginning Dec. 1, 1981, to issue such modifications to existing regulations governing defense acquisitions as might be necessary to implement the amendments made by subsections (a), (b), and (c) [amending sections 139, 2301, and 2306 of this title] and directed Director of the Office of Management and Budget to issue such modifications to existing Office of Management and Budget directives as might be necessary to take into account the amendments made by subsections (a) and (b) [amending sections 2301 and 2306 of this title].

Procurement Requirements for Goods Which Are Not American Goods

Pub. L. 93–365, title VII, §707, Aug. 5, 1974, 88 Stat. 406, which prohibited contracts by the Department of Defense for other than American goods after Aug. 5, 1974, unless adequate consideration was first given to bids of firms in labor surplus areas of the United States, of small business firms, and of all other United States firms which had offered to furnish American goods, balance of payments, cost of shipping other than American goods, and any duty, tariff, or surcharge on such goods, was repealed and restated in section 2501 of this title by Pub. L. 100–370, §3(a), (c). Section 2501 of this title was renumbered section 2506 by Pub. L. 100–456, §821(b)(1)(A). Section 2506 of this title was renumbered section 2533 by Pub. L. 102–484, §4202(a).

Section Referred to in Other Sections

This section is referred to in sections 1737, 2302d, 2304, 2366, 2367, 2399, 2403, 2409 of this title; title 50 App. section 2171.