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104th Congress                                            Rept. 104-222
                        HOUSE OF REPRESENTATIVES

 1st Session                                                     Part 1
_______________________________________________________________________


 
                 FEDERAL ACQUISITION REFORM ACT OF 1995

_______________________________________________________________________


                 August 1, 1995.--Ordered to be printed

                                _______


  Mr. Clinger, from the Committee on Government Reform and Oversight, 
                        submitted the following

                              R E P O R T

                             together with

                     MINORITY AND ADDITIONAL VIEWS

                        [To accompany H.R. 1670]

      [Including cost estimate of the Congressional Budget Office]
  The Committee on Government Reform and Oversight, to whom was 
referred the bill (H.R. 1670) to revise and streamline the 
acquisition laws of the Federal Government, to reorganize the 
mechanisms for resolving Federal procurement disputes, and for 
other purposes, having considered the same, report favorably 
thereon with an amendment and recommend that the bill as 
amended do pass.
                                CONTENTS

                                                                   Page
  I. Background and Need for the Legislation.........................42
 II. Legislative History/Committee Consideration.....................43
III. Explanation of the Bill.........................................46
 IV. Compliance with Rule XI.........................................61
  V. Budget Analysis and Projections.................................61
 VI. Cost Estimate of the Congressional Budget Office................61
VII. Inflationary Impact Statement...................................63
VIII.
     Changes in Existing Law.........................................63
 IX. Committee Recommendation.......................................184
  X. Congressional Accountability Act; Public Law 104-1.............184
 XI. Minority and Additional Views..................................185

  The amendment is as follows:
  Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Federal Acquisition Reform Act of 
1995''.

SEC. 2. TABLE OF CONTENTS.

  The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.

                          TITLE I--COMPETITION

Sec. 101. Improvement of competition requirements.
Sec. 102. Definitions relating to competition requirements.
Sec. 103. Contract solicitation amendments.
Sec. 104. Preaward debriefings.
Sec. 105. Contract types.
Sec. 106. Contractor performance.

                       TITLE II--COMMERCIAL ITEMS

Sec. 201. Commercial item exception to requirement for cost or pricing 
data and information limitations.
Sec. 202. Application of simplified procedures to commercial items.
Sec. 203. Amendment to definition of commercial items.
Sec. 204. Inapplicability of cost accounting standards to contracts and 
subcontracts for commercial items. 

                TITLE III--ADDITIONAL REFORM PROVISIONS

Sec. 301. Government reliance on the private sector.
Sec. 302. Elimination of certain certification requirements.
Sec. 303. Amendment to commencement and expiration of authority to 
conduct certain tests of procurement procedures.
Sec. 304. International competitiveness.
Sec. 305. Procurement integrity.
Sec. 306. Further acquisition streamlining provisions.
Sec. 307. Justification of major defense acquisition programs not 
meeting goals.
Sec. 308. Enhanced performance incentives for acquisition workforce.
Sec. 309. Results oriented acquisition program cycle.
Sec. 310. Rapid contracting goal.
Sec. 311. Encouragement of multiyear contracting.
Sec. 312. Contractor share of gains and losses from cost, schedule, and 
performance experience.
Sec. 313. Phase funding of defense acquisition programs.
Sec. 314. Improved Department of Defense contract payment procedures.
Sec. 315. Consideration of past performance in assignment to 
acquisition positions.
Sec. 316. Additional Department of Defense pilot programs.
Sec. 317. Value engineering for Federal agencies.
Sec. 318. Acquisition workforce.

              TITLE IV--STREAMLINING OF DISPUTE RESOLUTION

                     Subtitle A--General Provisions

Sec. 401. Definitions.

 Subtitle B--Establishment of Civilian and Defense Boards of Contract 
                                Appeals

Sec. 411. Establishment.
Sec. 412. Membership.
Sec. 413. Chairman.
Sec. 414. Rulemaking authority.
Sec. 415. Authorization of appropriations.

   Subtitle C--Functions of Defense and Civilian Boards of Contract 
                                Appeals

Sec. 421. Alternative dispute resolution services.
Sec. 422. Alternative dispute resolution of disputes and protests 
submitted to boards.
Sec. 423. Contract disputes.
Sec. 424. Protests.
Sec. 425. Applicability to certain contracts.

    Subtitle D--Repeal of Other Statutes Authorizing Administrative 
                                Protests

Sec. 431. Repeals.

    Subtitle E--Transfers and Transitional, Savings, and Conforming 
                               Provisions

Sec. 441. Transfer and allocation of appropriations and personnel.
Sec. 442. Terminations and savings provisions.
Sec. 443. Contract disputes authority of boards.
Sec. 444. References to agency boards of contract appeals.
Sec. 445. Conforming amendments.

       Subtitle F--Effective Date; Interim Appointment and Rules

Sec. 451. Effective date.
Sec. 452. Interim appointment.
Sec. 453. Interim rules.

              TITLE V--EFFECTIVE DATES AND IMPLEMENTATION

Sec. 501. Effective date and applicability.
Sec. 502. Implementing regulations.
                          TITLE I--COMPETITION

SEC. 101. IMPROVEMENT OF COMPETITION REQUIREMENTS.

  (a) Armed Services Acquisitions.--(1) Section 2304 of title 10, 
United States Code, is amended to read as follows:

``Sec. 2304. Contracts: competition requirements

  ``(a) Competition.--(1) Except as provided in subsections (b), (c), 
and (e) and except in the case of procurement procedures otherwise 
expressly authorized by statute, the head of an agency in conducting a 
procurement for property or services--
          ``(A) shall obtain full and open competition--
                  ``(i) that provides open access, and
                  ``(ii) that is consistent with the need to 
                efficiently fulfill the Government's requirements,
        through the use of competitive procedures in accordance with 
        this chapter and the Federal Acquisition Regulation; and
          ``(B) shall use the competitive procedure or combination of 
        competitive procedures that is best suited under the 
        circumstances of the procurement.
  ``(2) In determining the competitive procedure appropriate under the 
circumstances, the head of an agency--
          ``(A) shall solicit sealed bids if--
                  ``(i) time permits the solicitation, submission, and 
                evaluation of sealed bids;
                  ``(ii) the award will be made on the basis of price 
                and other price-related factors;
                  ``(iii) it is not necessary to conduct discussions 
                with the responding sources about their bids; and
                  ``(iv) there is a reasonable expectation of receiving 
                more than one sealed bid; and
          ``(B) shall request competitive proposals if sealed bids are 
        not appropriate under clause (A).
  ``(b) Exclusion of Particular Source.--The head of an agency may 
provide for the procurement of property or services covered by this 
chapter using competitive procedures but excluding a particular source 
in order to establish or maintain an alternative source or sources of 
supply for that property or service. The Federal Acquisition Regulation 
shall set forth the circumstances under which a particular source may 
be excluded pursuant to this subsection.
  ``(c) Exclusion of Concerns Other Than Small Business Concerns and 
Certain Other Entities.--The head of an agency may provide for the 
procurement of property or services covered by this section using 
competitive procedures, but excluding concerns other than small 
business concerns in furtherance of sections 9 and 15 of the Small 
Business Act (15 U.S.C. 638, 644) and concerns other than small 
business concerns, historically Black colleges and universities, and 
minority institutions in furtherance of section 2323 of this title.
  ``(d) Procedures Other Than Competitive Procedures.--(1) Procedures 
other than competitive procedures may be used for purchasing property 
and services only when the use of competitive procedures is not 
feasible or appropriate. Standards for determining when the use of 
competitive procedures is not feasible or appropriate shall be set 
forth in the Federal Acquisition Regulation. Each procurement using 
procedures other than competitive procedures (other than a procurement 
for commercial items using simplified procedures or a procurement in an 
amount not greater than the simplified acquisition threshold) shall be 
justified in writing and approved in accordance with the Federal 
Acquisition Regulation.
  ``(2) In the case of a procurement using procedures that preclude all 
but one source from responding (hereinafter in this subsection referred 
to as a `sole source procurement'), the Federal Acquisition Regulation 
shall provide for justification and approval under paragraph (1) of 
such procurement under standards that set forth limited circumstances 
for such sole source procurements, including circumstances when--
          ``(A) the property or services needed by the agency are 
        available from only one responsible source and no other type of 
        property or services will satisfy the needs of the agency;
          ``(B) the agency's need for the property or services is of 
        such an unusual and compelling urgency that the United States 
        would be seriously injured unless the agency is permitted to 
        award the contract for the property or services to a particular 
        source;
          ``(C) it is necessary to award the contract to a particular 
        source in order (i) to maintain a facility, producer, 
        manufacturer, or other supplier available for furnishing 
        property or services in case of a national emergency or to 
        achieve industrial mobilization, (ii) to establish or maintain 
        an essential engineering, research, or development capability 
        to be provided by an educational or other nonprofit institution 
        or a federally funded research and development center, or (iii) 
        to procure the services of an expert for use, in any litigation 
        or dispute (including any reasonably foreseeable litigation or 
        dispute) involving the Federal Government, in any trial, 
        hearing, or proceeding before any court, administrative 
        tribunal, or agency, or in any part of an alternative dispute 
        resolution process, whether or not the expert is expected to 
        testify;
          ``(D) the terms of an international agreement or a treaty 
        between the United States and a foreign government or 
        international organization, or the written directions of a 
        foreign government reimbursing the agency for the cost of the 
        procurement of the property or services for such government, 
        have the effect of requiring the award of the contract for the 
        property or services to a particular source;
          ``(E) subject to section 2304f, a statute expressly 
        authorizes or requires that the procurement be made through 
        another agency or from a specified source, or the agency's need 
        is for a brand-name commercial item for authorized resale;
          ``(F) the disclosure of the agency's needs would compromise 
        the national security unless the agency is permitted to award 
        the contract for the property or services needed by the agency 
        to a particular source; or
          ``(G) the head of the agency--
                  ``(i) determines that it is necessary in the public 
                interest to award the contract for the property or 
                services needed by the agency to a particular source in 
                the particular procurement concerned, and
                  ``(ii) notifies the Congress in writing of such 
                determination not less than 30 days before the award of 
                the contract.
  ``(3) The authority of the head of an agency under paragraph (2)(G) 
may not be delegated.
  ``(e) Simplified Procedures.--(1) In order to promote efficiency and 
economy in contracting and to avoid unnecessary burdens for agencies 
and contractors, the Federal Acquisition Regulation shall provide for 
special simplified procedures for purchases of property and services 
for amounts not greater than the simplified acquisition threshold.
  ``(2) A proposed purchase or contract for an amount above the 
simplified acquisition threshold may not be divided into several 
purchases or contracts for lesser amounts in order to use the 
simplified procedures required by paragraph (1).
  ``(3) In using simplified procedures, the head of an agency shall 
ensure that competition is obtained to the maximum extent practicable 
consistent with the particular Government requirement.
  ``(f) Certain Contracts.--For the purposes of the following laws, 
purchases or contracts awarded after using procedures other than 
sealed-bid procedures shall be treated as if they were made with 
sealed-bid procedures:
          ``(1) The Walsh-Healey Act (41 U.S.C. 35-45).
          ``(2) The Act entitled `An Act relating to the rate of wages 
        for laborers and mechanics employed on public buildings of the 
        United States and the District of Columbia by contractors and 
        subcontractors, and for other purposes', approved March 3, 1931 
        (commonly referred to as the `Davis-Bacon Act') (40 U.S.C. 
        276a--276a-5).''.
  (2) Chapter 137 of title 10, United States Code, is amended by 
inserting before section 2305 a new section--
          (A) the designation and heading for which is as follows:

``Sec. 2304f. Merit-based selection''; and

          (B) the text of which consists of subsection (j) of section 
        2304 of such title, as in effect on the day before the date of 
        the enactment of this Act, modified--
                  (i) by striking out the subsection designation;
                  (ii) in paragraphs (2)(A), (3), and (4), by striking 
                out ``subsection'' and inserting in lieu thereof 
                ``section'' each place it appears;
                  (iii) in paragraph (2)(C), by striking out 
                ``paragraph (1)'' and inserting in lieu thereof 
                ``subsection (a)'';
                  (iv) by redesignating paragraphs (1), (2), (3), and 
                (4) as subsections (a), (b), (c), and (d), 
                respectively; and
                  (v) in subsection (b) (as so redesignated), by 
                redesignating subparagraphs (A), (B), and (C) as 
                paragraphs (1), (2), and (3), respectively.
  (3) The table of sections at the beginning of such chapter is amended 
by inserting before the item relating section 2305 the following new 
item:

``2304f. Merit-based selection.''.

  (b) Civilian Agency Acquisitions.--(1) Section 303 of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 253) is 
amended to read as follows:

``SEC. 303. CONTRACTS: COMPETITION REQUIREMENTS.

  ``(a) Competition.--(1) Except as provided in subsections (b), (c), 
and (e) and except in the case of procurement procedures otherwise 
expressly authorized by statute, an executive agency in conducting a 
procurement for property or services--
          ``(A) shall obtain full and open competition--
                  ``(i) that provides open access, and
                  ``(ii) that is consistent with the need to 
                efficiently fulfill the Government's requirements,
        through the use of competitive procedures in accordance with 
        this chapter and the Federal Acquisition Regulation; and
          ``(B) shall use the competitive procedure or combination of 
        competitive procedures that is best suited under the 
        circumstances of the procurement.
  ``(2) In determining the competitive procedure appropriate under the 
circumstances, an executive agency--
          ``(A) shall solicit sealed bids if--
                  ``(i) time permits the solicitation, submission, and 
                evaluation of sealed bids;
                  ``(ii) the award will be made on the basis of price 
                and other price-related factors;
                  ``(iii) it is not necessary to conduct discussions 
                with the responding sources about their bids; and
                  ``(iv) there is a reasonable expectation of receiving 
                more than one sealed bid; and
          ``(B) shall request competitive proposals if sealed bids are 
        not appropriate under clause (A).
  ``(b) Exclusion of Particular Source.--An executive agency may 
provide for the procurement of property or services covered by this 
chapter using competitive procedures but excluding a particular source 
in order to establish or maintain an alternative source or sources of 
supply for that property or service. The Federal Acquisition Regulation 
shall set forth the circumstances under which a particular source may 
be excluded pursuant to this subsection.
  ``(c) Exclusion of Concerns Other than Small Business Concerns and 
Certain Other Entities.--An executive agency may provide for the 
procurement of property or services covered by this section using 
competitive procedures, but excluding concerns other than small 
business concerns in furtherance of sections 9 and 15 of the Small 
Business Act (15 U.S.C. 638, 644) and concerns other than small 
business concerns, historically Black colleges and universities, and 
minority institutions in furtherance of section 7102 of the Federal 
Acquisition Streamlining Act of 1994 (15 U.S.C. 644 note).
  ``(d) Procedures Other Than Competitive Procedures.--(1) Procedures 
other than competitive procedures may be used for purchasing property 
and services only when the use of competitive procedures is not 
feasible or appropriate. Standards for determining when the use of 
competitive procedures is not feasible or appropriate shall be set 
forth in the Federal Acquisition Regulation. Each procurement using 
procedures other than competitive procedures (other than a procurement 
for commercial items using simplified procedures or a procurement in an 
amount not greater than the simplified acquisition threshold) shall be 
justified in writing and approved in accordance with the Federal 
Acquisition Regulation.
  ``(2) In the case of a procurement using procedures that preclude all 
but one source from responding (hereinafter in this subsection referred 
to as a `sole source procurement'), the Federal Acquisition Regulation 
shall provide for justification and approval under paragraph (1) of 
such procurement under standards that set forth limited circumstances 
for such sole source procurements, including circumstances when--
          ``(A) the property or services needed by the executive agency 
        are available from only one responsible source and no other 
        type of property or services will satisfy the needs of the 
        executive agency;
          ``(B) the executive agency's need for the property or 
        services is of such an unusual and compelling urgency that the 
        United States would be seriously injured unless the executive 
        agency is permitted to award the contract for the property or 
        services to a particular source;
          ``(C) it is necessary to award the contract to a particular 
        source in order (i) to maintain a facility, producer, 
        manufacturer, or other supplier available for furnishing 
        property or services in case of a national emergency or to 
        achieve industrial mobilization, (ii) to establish or maintain 
        an essential engineering, research, or development capability 
        to be provided by an educational or other nonprofit institution 
        or a federally funded research and development center, or (iii) 
        to procure the services of an expert for use, in any litigation 
        or dispute (including any reasonably foreseeable litigation or 
        dispute) involving the Federal Government, in any trial, 
        hearing, or proceeding before any court, administrative 
        tribunal, or agency, or in any part of an alternative dispute 
        resolution process, whether or not the expert is expected to 
        testify;
          ``(D) the terms of an international agreement or treaty 
        between the United States Government and a foreign government 
        or international organization, or the written directions of a 
        foreign government reimbursing the executive agency for the 
        cost of the procurement of the property or services for such 
        government, have the effect of requiring the award of the 
        contract for the property or services to a particular source;
          ``(E) subject to section 303M, a statute expressly authorizes 
        or requires that the procurement be made through another 
        executive agency or from a specified source, or the agency's 
        need is for a brand-name commercial item for authorized resale;
          ``(F) the disclosure of the executive agency's needs would 
        compromise the national security unless the agency is permitted 
        to award the contract for the property or services needed by 
        the agency to a particular source; or
          ``(G) the head of the executive agency--
                  ``(i) determines that it is necessary in the public 
                interest to award the contract for the property or 
                services needed by the agency to a particular source in 
                the particular procurement concerned, and
                  ``(ii) notifies the Congress in writing of such 
                determination not less than 30 days before the award of 
                the contract.
  ``(3) The authority of the head of an executive agency under 
paragraph (2)(G) may not be delegated.
  ``(e) Simplified Procedures.--(1) In order to promote efficiency and 
economy in contracting and to avoid unnecessary burdens for agencies 
and contractors, the Federal Acquisition Regulation shall provide for 
special simplified procedures for purchases of property and services 
for amounts not greater than the simplified acquisition threshold.
  ``(2)(A) The Administrator of General Services shall prescribe 
regulations that provide special simplified procedures for acquisitions 
of leasehold interests in real property at rental rates that do not 
exceed the simplified acquisition threshold.
  ``(B) For purposes of subparagraph (A), the rental rate or rates 
under a multiyear lease do not exceed the simplified acquisition 
threshold if the average annual amount of the rent payable for the 
period of the lease does not exceed the simplified acquisition 
threshold.
  ``(3) A proposed purchase or contract or for an amount above the 
simplified acquisition threshold may not be divided into several 
purchases or contracts for lesser amounts in order to use the 
simplified procedures required by paragraph (1).
  ``(4) In using simplified procedures, an executive agency shall 
ensure that competition is obtained to the maximum extent practicable 
consistent with the particular Government requirement.''.
  (2) Title III of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 251 et seq.) is amended by inserting after section 
303L a new section--
          (A) the designation and heading for which is as follows:

``SEC. 303M. MERIT-BASED SELECTION.''; and

          (B) the text of which consists of subsection (h) of section 
        303 of such Act, as in effect on the day before the date of the 
        enactment of this Act, modified--
                  (i) by striking out the subsection designation;
                  (ii) in paragraphs (2)(A), (3), and (4), by striking 
                out ``subsection'' and inserting in lieu thereof 
                ``section'' each place it appears;
                  (iii) in paragraph (2)(C), by striking out 
                ``paragraph (1)'' and inserting in lieu thereof 
                ``subsection (a)'';
                  (iv) by redesignating paragraphs (1), (2), (3), and 
                (4) as subsections (a), (b), (c), and (d), 
                respectively; and
                  (v) in subsection (b) (as so redesignated), by 
                redesignating subparagraphs (A), (B), and (C) as 
                paragraphs (1), (2), and (3), respectively.
  (3) The table of contents for the Federal Property and Administrative 
Services Act of 1949 (contained in section 1(b)) is amended--
          (A) by striking out the item relating to section 303 and 
        inserting in lieu thereof the following:

``Sec. 303. Contracts: competition requirements.''; and

          (B) by inserting after the item relating to section 303L the 
        following new item:

``Sec. 303M. Merit-based selection.''.

  (c) Revisions to Procurement Notice Provisions.--Section 18 of the 
Office of Federal Procurement Policy Act (41 U.S.C. 416) is amended--
          (1) in subsection (a)--
                  (A) in subparagraph (B) of paragraph (1)--
                          (i) by striking out ``subsection (f)--'' and 
                        all that follows through the end of the 
                        subparagraph and inserting in lieu thereof 
                        ``subsection (b); and''; and
                          (ii) by inserting after ``property or 
                        services'' the following: ``for a price 
                        expected to exceed $10,000 but not to exceed 
                        $25,000'';
                  (B) by striking out paragraph (4); and
                  (C) by redesignating paragraphs (5) and (6) as 
                paragraphs (4) and (5), respectively; and
          (2) in subsection (b)--
                  (A) by amending subparagraph (B) of paragraph (2) to 
                read as follows:
                  ``(B) state whether the acquisition is to be 
                conducted pursuant to a contractor verification system 
                (as provided pursuant to section 35) or whether the 
                offeror, its product, or its service otherwise must 
                meet a qualification requirement in order to be 
                eligible for award and, if so, identify the criteria to 
                be used in determining such eligibility;''; and
                  (B) by amending paragraph (4) to read as follows:
          ``(4) a statement that all responsible sources may submit for 
        consideration a bid, proposal, or quotation;''.
  (d) Executive Agency Responsibilities.--(1) Section 16 of the Office 
of Federal Procurement Policy Act (41 U.S.C. 414) is amended--
          (A) by striking out ``achieve'' in the matter preceding 
        paragraph (1) and inserting in lieu thereof ``promote''; and
          (B) by amending paragraph (1) to read as follows:
          ``(1) to implement competition that provides open access for 
        responsible sources in the procurement of property or services 
        by the executive agency by establishing policies, procedures, 
        and practices that are consistent with the need to efficiently 
        fulfill the Government's requirements;''.
  (2) Section 20 of such Act (41 U.S.C. 418) is amended in subsection 
(a)(2)(A) by striking out ``serving in a position authorized for such 
executive agency on the date of enactment of the Competition in 
Contracting Act of 1984''.
SEC. 102. DEFINITIONS RELATING TO COMPETITION REQUIREMENTS.

  (a) Definition.--Paragraphs (5) and (6) of section 4 of the Office of 
Federal Procurement Policy Act (41 U.S.C. 403) are amended to read as 
follows:
          ``(5) The term `competitive procedures' means procedures 
        under which an agency enters into a contract pursuant to full 
        and open competition that provides open access and is 
        consistent with the need to efficiently fulfill the 
        Government's requirements.
          ``(6) The term `open access', when used with respect to a 
        procurement, means that all responsible sources are permitted 
        to submit sealed bids or competitive proposals on the 
        procurement.''.
  (b) Conforming Amendments.--
          (1) Office of federal procurement policy act.--Section 20 of 
        the Office of Federal Procurement Policy Act is amended--
                  (A) in subsection (b)(1), subsection (b)(3)(A), and 
                subsection (c), by inserting after ``full and open 
                competition'' the following: ``that provides open 
                access and is consistent with the need to efficiently 
                fulfill the Government's requirements'' each place it 
                appears; and
                  (B) in subsection (b)(4)(C), by striking out ``to 
                full and open competition that remain'' and inserting 
                in lieu thereof ``that remain to achieving full and 
                open competition that provides open access and is 
                consistent with the need to efficiently fulfill the 
                Government's requirements''.
          (2) Title 10.--Title 10, United States Code, is amended--
                  (A) in section 2302(2), by striking out the first 
                sentence and inserting in lieu thereof the following: 
                ``The term `competitive procedures' means procedures 
                under which an agency enters into a contract pursuant 
                to full and open competition that provides open access 
                and is consistent with the need to efficiently fulfill 
                the Government's requirements.'';
                  (B) in section 2302(3)(D), by striking out ``full and 
                open competition'' and inserting in lieu thereof ``open 
                access'';
                  (C) in section 2323(e)(3), by striking out ``less 
                than full and open'' and inserting in lieu thereof 
                ``procedures other than''; and
                  (D) in section 2323(i)(3)(A), by striking out ``full 
                and open''.
          (3) Federal property and administrative services act.--Title 
        III of the Federal Property and Administrative Services Act of 
        1949 (41 U.S.C. 251 et seq.) is amended--
                  (A) in section 309(b), by striking out the first 
                sentence and inserting in lieu thereof the following: 
                ``The term `competitive procedures' means procedures 
                under which an executive agency enters into a contract 
                pursuant to full and open competition that provides 
                open access and is consistent with the need to 
                efficiently fulfill the Government's requirements.'';
                  (B) in section 309(c)(4), by striking out ``full and 
                open competition'' and inserting in lieu thereof ``open 
                access''; and
                  (C) in section 304B(a)(2)(B), by striking out 
                ``encouraging full and open competition or''.
          (4) Other laws.--Section 7102 of the Federal Acquisition 
        Streamlining Act of 1994 (108 Stat. 3367; 15 U.S.C. 644 note) 
        is amended in subsection (a)(1)(A) by striking out ``less than 
        full and open competition'' and inserting in lieu thereof 
        ``procedures other than competitive procedures''.

SEC. 103. CONTRACT SOLICITATION AMENDMENTS.

  (a) Armed Services Acquisitions.--Section 2305 of title 10, United 
States Code, is amended--
          (1) in subsection (a)(1)--
                  (A) by striking out subparagraph (A) and inserting in 
                lieu thereof the following: ``(A) In preparing for the 
                procurement of property or services, the head of an 
                agency shall use advance procurement planning and 
                market research.'';
                  (B) by striking out subparagraph (B); and
                  (C) by redesignating subparagraph (C) as subparagraph 
                (B) and in that subparagraph by striking out ``For the 
                purposes of subparagraphs (A) and (B), the'' and 
                inserting in lieu thereof ``Each solicitation under 
                this chapter shall include specifications that include 
                restrictive provisions or conditions only to the extent 
                necessary to satisfy the needs of the agency or as 
                authorized by law. The'';
          (2) in subsection (a)(2), by inserting after ``(other than 
        for'' the following: ``a procurement for commercial items using 
        simplified procedures or''; and
          (3) in subsection (b)(4)(A)(i), by striking out ``all'' and 
        inserting in lieu thereof ``the''.
  (b) Civilian Agency Acquisitions.--(1) Section 303A of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 253a) is 
amended--
          (A) in subsection (a)--
                  (i) by striking out paragraph (1) and inserting in 
                lieu thereof the following: ``(1) In preparing for the 
                procurement of property or services, an executive 
                agency shall use advance procurement planning and 
                market research.'';
                  (ii) by striking out paragraph (2); and
                  (iii) by redesignating paragraph (3) as paragraph (2) 
                and in that paragraph by striking out ``For the 
                purposes of paragraphs (1) and (2), the'' and inserting 
                in lieu there of ``Each solicitation under this title 
                shall include specifications that include restrictive 
                provisions or conditions only to the extent necessary 
                to satisfy the needs of the executive agency or as 
                authorized by law. The''; and
          (B) in subsection (b), by inserting after ``(other than for'' 
        the following: ``a procurement for commercial items using 
        simplified procedures or''.
  (2) Section 303B(d)(1)(A) of such Act (41 U.S.C. 253b) is amended by 
striking out ``all'' and inserting in lieu thereof ``the''.

SEC. 104. PREAWARD DEBRIEFINGS.

  (a) Armed Services Acquisitions.--Section 2305(b) of title 10, United 
States Code, is amended--
          (1) by striking out subparagraph (F) of paragraph (5);
          (2) by redesignating paragraph (6) as paragraph (8); and
          (3) by inserting after paragraph (5) the following new 
        paragraphs:
  ``(6)(A) When the contracting officer excludes an offeror submitting 
a competitive proposal from the competitive range (or otherwise 
excludes such an offeror from further consideration prior to the final 
source selection decision), the excluded offeror may request in 
writing, within three days after the date on which the excluded offeror 
receives notice of its exclusion, a debriefing prior to award. The 
contracting officer shall make every effort to debrief the unsuccessful 
offeror as soon as practicable and may refuse the request for a 
debriefing if it is not in the best interests of the Government to 
conduct a debriefing at that time.
  ``(B) The contracting officer is required to debrief an excluded 
offeror in accordance with paragraph (5) of this section only if that 
offeror requested and was refused a preaward debriefing under 
subparagraph (A) of this paragraph.
  ``(C) The debriefing conducted under this subsection shall include--
          ``(i) the executive agency's evaluation of the significant 
        elements in the offeror's offer;
          ``(ii) a summary of the rationale for the offeror's 
        exclusion; and
          ``(iii) reasonable responses to relevant questions posed by 
        the debriefed offeror as to whether source selection procedures 
        set forth in the solicitation, applicable regulations, and 
        other applicable authorities were followed by the executive 
        agency.
  ``(D) The debriefing conducted pursuant to this subsection may not 
disclose the number or identity of other offerors and shall not 
disclose information about the content, ranking, or evaluation of other 
offerors' proposals.
  ``(7) The contracting officer shall include a summary of any 
debriefing conducted under paragraph (5) or (6) in the contract 
file.''.
  (b) Civilian Agency Acquisitions.--Section 303B of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 253b) is 
amended--
          (1) by striking out paragraph (6) of subsection (e);
          (2) by redesignating subsections (f), (g), (h), and (i) as 
        subsections (h), (i), (j), and (k), respectively; and 
        cross refs checked in FPA only deg.
          (3) by inserting after subsection (e) the following new 
        subsections:
  ``(f)(1) When the contracting officer excludes an offeror submitting 
a competitive proposal from the competitive range (or otherwise 
excludes such an offeror from further consideration prior to the final 
source selection decision), the excluded offeror may request in 
writing, within 3 days after the date on which the excluded offeror 
receives notice of its exclusion, a debriefing prior to award. The 
contracting officer shall make every effort to debrief the unsuccessful 
offeror as soon as practicable and may refuse the request for a 
debriefing if it is not in the best interests of the Government to 
conduct a debriefing at that time.
  ``(2) The contracting officer is required to debrief an excluded 
offeror in accordance with subsection (e) of this section only if that 
offeror requested and was refused a preaward debriefing under paragraph 
(1) of this subsection.
  ``(3) The debriefing conducted under this subsection shall include--
          ``(A) the executive agency's evaluation of the significant 
        elements in the offeror's offer;
          ``(B) a summary of the rationale for the offeror's exclusion; 
        and
          ``(C) reasonable responses to relevant questions posed by the 
        debriefed offeror as to whether source selection procedures set 
        forth in the solicitation, applicable regulations, and other 
        applicable authorities were followed by the executive agency.
  ``(4) The debriefing conducted pursuant to this subsection may not 
disclose the number or identity of other offerors and shall not 
disclose information about the content, ranking, or evaluation of other 
offerors' proposals.
  ``(g) The contracting officer shall include a summary of the any 
debriefing conducted under subsection (e) or (f) in the contract 
file.''.

SEC. 105. CONTRACT TYPES.

  (a) Armed Services Acquisitions.--(1) Section 2306 of title 10, 
United States Code, is amended--
          (A) by inserting before the period at the end of subsection 
        (a) the following: ``, based on market conditions, established 
        commercial practice (if any) for the product or service being 
        acquired, and sound business judgment'';
          (B) by striking out subsections (b), (d), (e), (f), and (h); 
        and
          (C) by redesignating subsection (g) as subsection (b).
  (2) The heading of such section is amended to read as follows:

``Sec. 2306. Contract types''.

  (3) The item relating to section 2306 in the table of sections at the 
beginning of chapter 137 of such title is amended to read as follows:

``2306. Contract types.''.

  (b) Civilian Agency Acquisitions.--(1) Section 304 of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 254) is 
amended--
          (A) by inserting before the period at the end of the first 
        sentence of subsection (a) the following: ``, based on market 
        conditions, established commercial practice (if any) for the 
        product or service being acquired, and sound business 
        judgment'';
          (B) by striking out ``Every contract awarded'' in the second 
        sentence of subsection (a) and all that follows through the end 
        of the subsection; and
          (C) in subsection (b), by striking out ``used,'' in the first 
        sentence and all that follows through the end of the subsection 
        and inserting in lieu thereof ``used.''.
  (2) The heading of such section is amended to read as follows:

``SEC. 304. CONTRACT TYPES.''.

  (3) The item relating to section 304 in the table of contents for 
such Act (contained in section 1(b)) is amended to read as follows:

``Sec. 304. Contract types.''.

  (c) Conforming Repeals.--(1) Sections 4540, 7212, and 9540 of title 
10, United States Code, are repealed.
  (2) The table of sections at the beginning of chapter 433 of such 
title is amended by striking out the item relating to section 4540.
  (3) The table of sections at the beginning of chapter 631 of such 
title is amended by striking out the item relating to section 7212.
  (4) The table of sections at the beginning of chapter 933 of such 
title is amended by striking out the item relating to section 9540.
  (d) Civil Works Authority.--(1) Part IV of subtitle A of title 10, 
United States Code, is amended--
          (A) by transferring section 2855 to the end of chapter 137; 
        and
          (B) by striking out the section heading and subsection (a) of 
        such section and inserting in lieu thereof the following:

``Sec. 2332. Contracts for architectural and engineering services

  ``(a) The Secretary of Defense and the Secretaries of the military 
departments may enter into contracts for architectural and engineering 
services in connection with a military construction or family housing 
project or for other Department of Defense or military department 
purposes. Such contracts shall be awarded in accordance with the Brooks 
Architect-Engineers Act (40 U.S.C. 541 et seq.).''.
  (2) The table of sections at the beginning of chapter 137 of such 
title is amended by adding at the end the following new item:

``2332. Contracts for architectural and engineering services.''.

  (3) The table of sections at the beginning of chapter 169 of such 
title is amended by striking out the item relating to section 2855.
SEC. 106. CONTRACTOR PERFORMANCE.

  (a) Requirement for System.--The Office of Federal Procurement Policy 
Act (41 U.S.C. 401 et seq.) is amended by adding at the end the 
following new section:

``SEC. 35. CONTRACTOR PERFORMANCE.

  ``(a) Verification System.--
          ``(1) Requirement.--The Federal Acquisition Regulation shall 
        provide for a contractor verification system in accordance with 
        this section.
          ``(2) Procedures.--The Federal Acquisition Regulation shall 
        provide procedures for the head of an executive agency to 
        follow in order to verify a contractor as eligible to compete 
        for contracts to furnish property or services that are procured 
        by the executive agency on a recurring basis.
          ``(3) Notification.--The procedures shall include a 
        requirement that the head of an executive agency provide for 
        the publication of appropriate notification about the 
        verification system in the Commerce Business Daily.
  ``(b) Evaluation.--(1) Under the procedures referred to in subsection 
(a)(2), the head of an executive agency in granting a verification to a 
contractor shall use the following factors as the basis of the 
evaluation:
          ``(A) The efficiency and effectiveness of its business 
        practices.
          ``(B) The level of quality of its product or service.
          ``(C) Past performance of the contractor with regard to the 
        particular property or service.
  ``(2)(A) The evaluation of past performance may include performance 
under--
          ``(i) a contract with an executive agency of the Federal 
        Government;
          ``(ii) a contract with an agency of a State or local 
        government; or
          ``(iii) a contract with an entity in the private sector.
  ``(B) The procedures shall include a requirement that, in the case of 
a contractor with respect to which there is no information on past 
contract performance or with respect to which information on past 
contract performance is not available, the contractor may not be 
evaluated favorably or unfavorably on the factor of past performance.
  ``(c) Opportunity for All Interested Sources.--The Federal 
Acquisition Regulation shall provide procedures for ensuring that all 
interested sources, including small businesses, have a fair opportunity 
to be considered for verification under the verification system.
  ``(d) Procurement From Verified Contractors.--The Federal Acquisition 
Regulation shall provide procedures under which the head of an 
executive agency may enter into a contract for the procurement of 
property or services referred to in subsection (a)(2) on the basis of a 
competition in accordance with section 2304 of title 10, United States 
Code, or section 303 of the Federal Property and Administrative 
Services Act of 1949 (41 U.S.C. 253) for contractors verified with 
respect to such property or services pursuant to the contractor 
verification system.
  ``(e) Termination of Verification.--The Federal Acquisition 
Regulation shall provide procedures under which the head of an 
executive agency--
          ``(1) may provide for the termination of a verification 
        granted a contractor under this section upon the expiration of 
        a period specified by the head of an executive agency;
          ``(2) may revoke a verification granted a contractor under 
        this section upon a determination that the quality of 
        performance of the contractor does not meet standards applied 
        by the head of the executive agency as of the time of the 
        revocation decision; and
          ``(3) may provide that a contractor whose verification is 
        terminated or revoked will have a fair opportunity to be 
        considered for reentry into the verification system.
  ``(f) Special Applicability Rule.--Notwithstanding section 34, the 
verification system shall apply to the procurement of commercial 
items.''.
  (b) Repeals.--Section 2319 of title 10, United States Code, is 
repealed. Section 303C of the Federal Property and Administrative 
Services Act of 1949 (41 U.S.C. 253c) is repealed.
  (c) Clerical Amendments.--(1) The table of contents for the Office of 
Federal Procurement Policy Act (contained in section 1(b)) is amended 
by adding at the end the following new item:

``Sec. 35. Contractor performance.''.

  (2) The table of sections at the beginning of chapter 137 of title 
10, United States Code, is amended by striking out the item relating to 
section 2319.
  (3) The table of contents for the Federal Property and Administrative 
Services Act of 1949 (contained in section 1(b)) is amended by striking 
out the item relating to section 303C.
                       TITLE II--COMMERCIAL ITEMS

SEC. 201. COMMERCIAL ITEM EXCEPTION TO REQUIREMENT FOR COST OR PRICING 
                    DATA AND INFORMATION LIMITATIONS.

  (a) Armed Services Acquisitions.--(1) Subsections (b), (c), and (d) 
of section 2306a of title 10, United States Code, are amended to read 
as follows:
  ``(b) Exceptions.--
          ``(1) In general.--Submission of cost or pricing data shall 
        not be required under subsection (a) in the case of a contract, 
        a subcontract, or modification of a contract or subcontract--
                  ``(A) for which the price agreed upon is based on--
                          ``(i) adequate price competition; or
                          ``(ii) prices set by law or regulation;
                  ``(B) for the acquisition of a commercial item; or
                  ``(C) in an exceptional case when the head of the 
                procuring activity, without delegation, determines that 
                the requirements of this section may be waived and 
                justifies in writing the reasons for such 
                determination.
          ``(2) Modifications of contracts and subcontracts for 
        commercial items.--In the case of a modification of a contract 
        or subcontract for a commercial item that is not covered by the 
        exception on the submission of cost or pricing data in 
        paragraph (1)(A) or (1)(B), submission of cost or pricing data 
        shall not be required under subsection (a) if--
                  ``(A) the contract or subcontract being modified is a 
                contract or subcontract for which submission of cost or 
                pricing data may not be required by reason of paragraph 
                (1)(A) or (1)(B); and
                  ``(B) the modification would not change the contract 
                or subcontract, as the case may be, from a contract or 
                subcontract for the acquisition of a commercial item to 
                a contract or subcontract for the acquisition of an 
                item other than a commercial item.
  ``(c) Authority To Require Cost or Pricing Data on Below-Threshold 
Contracts.--(1) Subject to paragraph (2), when certified cost or 
pricing data are not required to be submitted by subsection (a) for a 
contract, subcontract, or modification of a contract or subcontract, 
such data may nevertheless be required to be submitted by the head of 
the procuring activity, but only if the head of the procuring activity 
determines that such data are necessary for the evaluation by the 
agency of the reasonableness of the price of the contract, subcontract, 
or modification of a contract or subcontract. In any case in which the 
head of the procuring activity requires such data to be submitted under 
this subsection, the head of the procuring activity shall justify in 
writing the reason for such requirement.
  ``(2) The head of the procuring activity may not require certified 
cost or pricing data to be submitted under this paragraph for any 
contract or subcontract, or modification of a contract or subcontract, 
covered by the exceptions in subparagraph (A) or (B) of subsection 
(b)(1).
  ``(3) The head of a procuring activity may not delegate functions 
under this paragraph.
  ``(d) Limitations on Other Information.--The Federal Acquisition 
Regulation shall include the following:
          ``(1) Provisions concerning the types of information that 
        contracting officers may consider in determining whether the 
        price of a procurement to the Government is fair and reasonable 
        when certified cost or pricing data are not required to be 
        submitted under this section, including appropriate information 
        on the prices at which the same item or similar items have 
        previously been sold that is adequate for evaluating the 
        reasonableness of the price of the proposed contract or 
        subcontract for the procurement.
          ``(2) Reasonable limitations on requests for sales data 
        relating to commercial items.
          ``(3) A requirement that a contracting officer shall, to the 
        maximum extent practicable, limit the scope of any request for 
        information relating to commercial items from an offeror to 
        only that information that is in the form regularly maintained 
        by the offeror in commercial operations.
          ``(4) A statement that any information received relating to 
        commercial items that is exempt from disclosure under section 
        552(b) of title 5 shall not be disclosed by the Federal 
        Government.''.
  (2) Section 2306a of such title is further amended--
          (A) by striking out subsection (h); and
          (B) by redesignating subsection (i) as subsection (h).
  (3) Section 2375 of title 10, United States Code, is amended by 
striking out subsection (c).
  (b) Civilian Agency Acquisitions.--(1) Subsections (b), (c) and (d) 
of section 304A of the Federal Property and Administrative Services Act 
of 1949 (41 U.S.C. 254b) are amended to read as follows:
  ``(b) Exceptions.--
          ``(1) In general.--Submission of cost or pricing data shall 
        not be required under subsection (a) in the case of a contract, 
        a subcontract, or a modification of a contract or subcontract--
                  ``(A) for which the price agreed upon is based on--
                          ``(i) adequate price competition; or
                          ``(ii) prices set by law or regulation;
                  ``(B) for the acquisition of a commercial item; or
                  ``(C) in an exceptional case when the head of the 
                procuring activity, without delegation, determines that 
                the requirements of this section may be waived and 
                justifies in writing the reasons for such 
                determination.
          ``(2) Modifications of contracts and subcontracts for 
        commercial items.--In the case of a modification of a contract 
        or subcontract for a commercial item that is not covered by the 
        exception on the submission of cost or pricing data in 
        paragraph (1)(A) or (1)(B), submission of cost or pricing data 
        shall not be required under subsection (a) if--
                  ``(A) the contract or subcontract being modified is a 
                contract or subcontract for which submission of cost or 
                pricing data may not be required by reason of paragraph 
                (1)(A) or (1)(B); and
                  ``(B) the modification would not change the contract 
                or subcontract, as the case may be, from a contract or 
                subcontract for the acquisition of a commercial item to 
                a contract or subcontract for the acquisition of an 
                item other than a commercial item.
  ``(c) Authority To Require Cost or Pricing Data on Below-Threshold 
Contracts.--(1) Subject to paragraph (2), when certified cost or 
pricing data are not required to be submitted by subsection (a) for a 
contract, subcontract, or modification of a contract or subcontract, 
such data may nevertheless be required to be submitted by the head of 
the procuring activity, but only if the head of the procuring activity 
determines that such data are necessary for the evaluation by the 
agency of the reasonableness of the price of the contract, subcontract, 
or modification of a contract or subcontract. In any case in which the 
head of the procuring activity requires such data to be submitted under 
this subsection, the head of the procuring activity shall justify in 
writing the reason for such requirement.
  ``(2) The head of the procuring activity may not require certified 
cost or pricing data to be submitted under this paragraph for any 
contract or subcontract, or modification of a contract or subcontract, 
covered by the exceptions in subparagraph (A) or (B) of subsection 
(b)(1).
  ``(3) The head of a procuring activity may not delegate the functions 
under this paragraph.
  ``(d) Limitations on Other Information.--The Federal Acquisition 
Regulation shall include the following:
          ``(1) Provisions concerning the types of information that 
        contracting officers may consider in determining whether the 
        price of a procurement to the Government is fair and reasonable 
        when certified cost or pricing data are not required to be 
        submitted under this section, including appropriate information 
        on the prices at which the same item or similar items have 
        previously been sold that is adequate for evaluating the 
        reasonableness of the price of the proposed contract or 
        subcontract for the procurement.
          ``(2) Reasonable limitations on requests for sales data 
        relating to commercial items.
          ``(3) A requirement that a contracting officer shall, to the 
        maximum extent practicable, limit the scope of any request for 
        information relating to commercial items from an offeror to 
        only that information that is in the form regularly maintained 
        by the offeror in commercial operations.
          ``(4) A statement that any information received relating to 
        commercial items that is exempt from disclosure under section 
        552(b) of title 5 shall not be disclosed by the Federal 
        Government.''.
  (2) Section 304A of such Act is further amended--
          (A) by striking out subsection (h); and
          (B) by redesignating subsection (i) as subsection (h).

SEC. 202. APPLICATION OF SIMPLIFIED PROCEDURES TO COMMERCIAL ITEMS.

  (a) Armed Services Acquisitions.--Section 2304(e) of title 10, United 
States Code, as amended by section 101(a), is further amended--
          (1) in paragraph (1), by inserting after ``special simplified 
        procedures'' the following: ``for purchases of commercial items 
        and''; and
          (2) by adding at the end the following new paragraph:
  ``(4) The Federal Acquisition Regulation shall provide that, in the 
case of a purchase of commercial items in an amount greater than the 
simplified acquisition threshold, the head of an agency--
          ``(A) may not conduct the purchase on a sole source basis 
        unless the need to do so is justified in writing and approved 
        in accordance with the Federal Acquisition Regulation; and
          ``(B) shall include in the contract file a written 
        description of the procedures used in awarding the contract and 
        the number of offers received.''.
  (b) Civilian Agency Acquisitions.--Section 303(e) of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 253), as 
amended by section 101(b), is further amended--
          (1) in paragraph (1), by inserting after ``special simplified 
        procedures'' the following: ``for purchases of commercial items 
        and''; and
          (2) by adding at the end the following new paragraph:
  ``(5) The Federal Acquisition Regulation shall provide that, in the 
case of a purchase of commercial items in an amount greater than the 
simplified acquisition threshold, an executive agency--
          ``(A) may not conduct the purchase on a sole source basis 
        unless the need to do so is justified in writing and approved 
        in accordance with the Federal Acquisition Regulation; and
          ``(B) shall include in the contract file a written 
        description of the procedures used in awarding the contract and 
        the number of offers received.''.
  (c) Simplified Notice.--Section 18 of the Office of Federal 
Procurement Policy Act (41 U.S.C. 416) is amended--
          (1) in subsection (a)(5) (as redesignated by section 
        101(c))--
                  (A) by striking out ``limited''; and
                  (B) by inserting before ``submission'' the following: 
                ``issuance of solicitations and the''; and
          (2) in subsection (b)(6), by striking out ``threshold--'' and 
        inserting in lieu thereof ``threshold, or a contract for the 
        procurement of commercial items using simplified procedures--
        ''.

SEC. 203. AMENDMENT TO DEFINITION OF COMMERCIAL ITEMS.

  Section 4(12)(F) of the Office of Federal Procurement Policy Act (41 
U.S.C. 403(12)(F)) is amended by striking out ``catalog''.

SEC. 204. INAPPLICABILITY OF COST ACCOUNTING STANDARDS TO CONTRACTS AND 
                    SUBCONTRACTS FOR COMMERCIAL ITEMS.

  Subparagraph (B) of section 26(f)(2) of the Office of Federal 
Procurement Policy Act (41 U.S.C. 422(f)(2)) is amended--
          (1) by striking out clause (i) and inserting in lieu thereof 
        the following:
          ``(i) Contracts or subcontracts for the acquisition of 
        commercial items.''; and
          (2) by striking out clause (iii).
                TITLE III--ADDITIONAL REFORM PROVISIONS
SEC. 301. GOVERNMENT RELIANCE ON THE PRIVATE SECTOR.

  (a) Government Reliance on the Private Sector.--The Office of Federal 
Procurement Policy Act (41 U.S.C. 401 et seq.) is amended by inserting 
after section 16 the following new section:

``SEC. 17. GOVERNMENT RELIANCE ON THE PRIVATE SECTOR.

  ``It is the policy of the Federal Government to rely on the private 
sector to supply the products and services the Federal Government 
needs.''.
  (b) Clerical Amendment.--The table of contents for the Office of 
Federal Procurement Policy Act (contained in section 1(b)) is amended 
by inserting after the item relating to section 16 the following new 
item:

``Sec. 17. Government reliance on the private sector.''.
SEC. 302. ELIMINATION OF CERTAIN CERTIFICATION REQUIREMENTS.

  (a) Elimination of Certain Statutory Certification Requirements.--
(1)(A) Section 2410 of title 10, United States Code, is amended--
          (i) in the heading, by striking out ``: certification''; and
          (ii) in subsection (a)--
                  (I) in the heading, by striking out 
                ``Certification'';
                  (II) by striking out ``unless'' and all that follows 
                through ``that--'' and inserting in lieu thereof 
                ``unless--''; and
                  (III) in paragraph (2), by striking out ``to the best 
                of that person's knowledge and belief''.
  (B) The item relating to section 2410 in the table of sections at the 
beginning of chapter 141 of such title is amended to read as follows:

``Sec. 2410. Requests for equitable adjustment or other relief.''.

  (2) Section 2410b of title 10, United States Code, is amended in 
paragraph (2) by striking out ``certification and''.
  (3) Section 1352(b)(2) of title 31, United States Code, is amended--
          (A) by striking out subparagraph (C); and
          (B) by inserting ``and'' after the semicolon at the end of 
        subparagraph (A).
  (4) Section 5152 of the Drug-Free Workplace Act of 1988 (41 U.S.C. 
701) is amended--
          (A) in subsection (a)(1), by striking out ``has certified to 
        the contracting agency that it will'' and inserting in lieu 
        thereof ``agrees to'';
          (B) in subsection (a)(2), by striking out ``contract includes 
        a certification by the individual'' and inserting in lieu 
        thereof ``individual agrees''; and
          (C) in subsection (b)(1)--
                  (i) by striking out subparagraph (A);
                  (ii) by redesignating subparagraph (B) as 
                subparagraph (A) and in that subparagraph by striking 
                out ``such certification by failing to carry out''; and
                  (iii) by redesignating subparagraph (C) as 
                subparagraph (B).
  (b) Elimination of Certain Regulatory Certification Requirements.--
          (1) Current certification requirements.--(A) Not later than 
        210 days after the date of the enactment of this Act, any 
        certification required of contractors or offerors by the 
        Federal Acquisition Regulation that is not specifically imposed 
        by statute shall be removed by the Administrator for Federal 
        Procurement Policy from the Federal Acquisition Regulation 
        unless--
                  (i) written justification for such certification is 
                provided to the Administrator by the Federal 
                Acquisition Regulatory Council; and
                  (ii) the Administrator approves in writing the 
                retention of such certification.
          (B)(i) Not later than 210 days after the date of the 
        enactment of this Act, any certification required of 
        contractors or offerors by a procurement regulation of an 
        executive agency that is not specifically imposed by statute 
        shall be removed by the head of the executive agency from such 
        regulation unless--
                  (I) written justification for such certification is 
                provided to the head of the executive agency by the 
                senior procurement executive; and
                  (II) the head of the executive agency approves in 
                writing the retention of such certification.
          (ii) For purposes of clause (i), the term ``head of the 
        executive agency'' with respect to a military department means 
        the Secretary of Defense.
          (iii) The Secretary of Defense may delegate his duties under 
        this subparagraph only to the Under Secretary of Defense for 
        Acquisition and Technology.
          (2) Future certification requirements.--(A) Section 29 of the 
        Office of Federal Procurement Policy Act (41 U.S.C. 425) is 
        amended--
                  (i) by amending the heading to read as follows:

``SEC. 29. CONTRACT CLAUSES AND CERTIFICATIONS.'';

                  (ii) by inserting ``(a) Nonstandard Contract 
                Clauses.--'' before ``The Federal Acquisition''; and
                  (iii) by adding at the end the following new 
                subsection:
  ``(b) Prohibition on Certification Requirements.--(1) A requirement 
for a certification by a contractor or offeror may not be included in 
the Federal Acquisition Regulation unless--
          ``(A) the certification is specifically imposed by statute; 
        or
          ``(B) written justification for such certification is 
        provided to the Administrator for Federal Procurement Policy by 
        the Federal Acquisition Regulatory Council, and the 
        Administrator approves in writing the inclusion of such 
        certification.
  ``(2)(A) A requirement for a certification by a contractor or offeror 
may not be included in a procurement regulation of an executive agency 
unless--
          ``(i) the certification is specifically imposed by statute; 
        or
          ``(ii) written justification for such certification is 
        provided to the head of the executive agency by the senior 
        procurement executive of the agency, and the head of the 
        executive agency approves in writing the inclusion of such 
        certification.
  ``(B) For purposes of subparagraph (A), the term `head of the 
executive agency' with respect to a military department means the 
Secretary of Defense.
  ``(C) The Secretary of Defense may delegate his duties under this 
paragraph only to the Under Secretary of Defense for Acquisition and 
Technology.''.
  (B) The item relating to section 29 in the table of contents for the 
Office of Federal Procurement Policy Act (contained in section 1(b)) 
(41 U.S.C. 401 note) is amended to read as follows:

``Sec. 29. Contract clauses and certifications.''.
SEC. 303. AMENDMENT TO COMMENCEMENT AND EXPIRATION OF AUTHORITY TO 
                    CONDUCT CERTAIN TESTS OF PROCUREMENT PROCEDURES.

  Subsection (j) of section 5061 of the Federal Acquisition 
Streamlining Act of 1994 (41 U.S.C. 413 note) is amended to read as 
follows:
  ``(j) Commencement and Expiration of Authority.--The authority to 
conduct a test under subsection (a) in an agency and to award contracts 
under such a test shall take effect on August 1, 1995, and shall expire 
on August 1, 2000. Contracts entered into before such authority expires 
in an agency pursuant to a test shall remain in effect, notwithstanding 
the expiration of the authority to conduct the test under this 
section.''.

SEC. 304. INTERNATIONAL COMPETITIVENESS.

  (a) Repeal of Provision Relating to Research, Development, and 
Production Costs.--
          (1) Subject to paragraph (2), section 21(e) of the Arms 
        Export Control Act (22 U.S.C. 2761(e)) is amended--
                  (A) by inserting ``and'' after the semicolon at the 
                end of paragraph (1)(A);
                  (B) by striking out subparagraph (B) of paragraph 
                (1);
                  (C) by redesignating subparagraph (C) of paragraph 
                (1) as subparagraph (B);
                  (D) by striking out paragraph (2); and
                  (E) by redesignating paragraph (3) as paragraph (2).
          (2) Paragraph (1) shall be effective only if--
                  (A) the President, in the budget of the President for 
                fiscal year 1997, proposes legislation that if enacted 
                would be qualifying offsetting legislation; and
                  (B) there is enacted by October 1, 1996, qualifying 
                offsetting legislation.
          (3) If the conditions in paragraph (2) are met, then the 
        amendments made by paragraph (1) shall take effect on October 
        1, 1996.
          (4) For purposes of this subsection:
                  (A) The term ``qualifying offsetting legislation'' 
                means legislation that includes provisions that--
                          (i) offset fully the estimated revenues lost 
                        as a result of the amendments made by paragraph 
                        (1) for each of the fiscal years 1997 through 
                        2000;
                          (ii) expressly state that they are enacted 
                        for the purpose of the offset described in 
                        clause (i); and
                          (iii) are included in full on the PayGo 
                        scorecard.
                  (B) The term ``PayGo scorecard'' means the estimates 
                that are made with respect to fiscal years through 
                fiscal year 2000 by the Director of the Congressional 
                Budget Office and the Director of the Office of 
                Management and Budget under section 252(d) of the 
                Balanced Budget and Emergency Deficit Control Act of 
                1985.
  (b) Effective Dates.--The amendments made by subsection (a) shall be 
effective with respect to sales agreements pursuant to sections 21 and 
22 of the Arms Export Control Act (22 U.S.C. 2761 and 2762) entered 
into during the period beginning on October 1, 1996, and ending on 
September 30, 2000.

SEC. 305. PROCUREMENT INTEGRITY.

  (a) Amendment of Procurement Integrity Provision.--Section 27 of the 
Office of Federal Procurement Policy Act (41 U.S.C. 423) is amended to 
read as follows:

``SEC. 27. RESTRICTIONS ON DISCLOSING AND OBTAINING CONTRACTOR BID OR 
                    PROPOSAL INFORMATION OR SOURCE SELECTION 
                    INFORMATION.

  ``(a) Prohibition on Disclosing Procurement Information.--(1) A 
person described in paragraph (2) shall not, other than as provided by 
law, knowingly disclose contractor bid or proposal information or 
source selection information before the award of a Federal agency 
procurement contract to which the information relates.
  ``(2) Paragraph (1) applies to any person who--
          ``(A) is a present or former officer or employee of the 
        United States, or a person who is acting or has acted for or on 
        behalf of, or who is advising or has advised the United States 
        with respect to, a Federal agency procurement; and
          ``(B) by virtue of that office, employment, or relationship 
        has or had access to contractor bid or proposal information or 
        source selection information.
  ``(b) Prohibition on Obtaining Procurement Information.--A person 
shall not, other than as provided by law, knowingly obtain contractor 
bid or proposal information or source selection information before the 
award of a Federal agency procurement contract to which the information 
relates.
  ``(c) Prohibition on Disclosing or Obtaining Procurement Information 
in Connection With a Protest.--(1) A person shall not, other than as 
provided by law, knowingly violate the terms of a protective order 
described in paragraph (2) by disclosing or obtaining contractor bid or 
proposal information or source selection information related to the 
procurement contract concerned.
  ``(2) Paragraph (1) applies to any protective order issued by the 
Defense Board or the Civilian Board in connection with a protest 
against the award or proposed award of a Federal agency procurement 
contract.
  ``(d) Penalties and Administrative Actions.--
          ``(1) Criminal penalties.--
                  ``(A) Whoever engages in conduct constituting an 
                offense under subsection (a), (b), or (c) shall be 
                imprisoned for not more than one year or fined as 
                provided under title 18, United States Code, or both.
                  ``(B) Whoever engages in conduct constituting an 
                offense under subsection (a), (b), or (c) for the 
                purpose of either--
                          ``(i) exchanging the information covered by 
                        such subsection for anything of value, or
                          ``(ii) obtaining or giving anyone a 
                        competitive advantage in the award of a Federal 
                        agency procurement contract,
                shall be imprisoned for not more than 15 years or fined 
                as provided under title 18, United States Code, or 
                both.
          ``(2) Civil penalties.--The Attorney General may bring a 
        civil action in the appropriate United States district court 
        against any person who engages in conduct constituting an 
        offense under subsection (a), (b), or (c). Upon proof of such 
        conduct by a preponderance of the evidence, the person is 
        subject to a civil penalty. An individual who engages in such 
        conduct is subject to a civil penalty of not more than $50,000 
        for each violation plus twice the amount of compensation which 
        the individual received or offered for the prohibited conduct. 
        An organization that engages in such conduct is subject to a 
        civil penalty of not more than $500,000 for each violation plus 
        twice the amount of compensation which the organization 
        received or offered for the prohibited conduct.
          ``(3) Administrative actions.--(A) If a Federal agency 
        receives information that a contractor or a person has engaged 
        in conduct constituting an offense under subsection (a), (b), 
        or (c), the Federal agency shall consider taking one or more of 
        the following actions, as appropriate:
                  ``(i) Cancellation of the Federal agency procurement, 
                if a contract has not yet been awarded.
                  ``(ii) Rescission of a contract with respect to 
                which--
                          ``(I) the contractor or someone acting for 
                        the contractor has been convicted for an 
                        offense under subsection (a), (b), or (c), or
                          ``(II) the head of the agency that awarded 
                        the contract has determined, based upon a 
                        preponderance of the evidence, that the 
                        contractor or someone acting for the contractor 
                        has engaged in conduct constituting such an 
                        offense.
                  ``(iii) Initiation of suspension or debarment 
                proceedings for the protection of the Government in 
                accordance with procedures in the Federal Acquisition 
                Regulation.
                  ``(iv) Initiation of adverse personnel action, 
                pursuant to the procedures in chapter 75 of title 5, 
                United States Code, or other applicable law or 
                regulation.
          ``(B) If a Federal agency rescinds a contract pursuant to 
        subparagraph (A)(ii), the United States is entitled to recover, 
        in addition to any penalty prescribed by law, the amount 
        expended under the contract.
          ``(C) For purposes of any suspension or debarment proceedings 
        initiated pursuant to subparagraph (A)(iii), engaging in 
        conduct constituting an offense under subsection (a), (b), or 
        (c) affects the present responsibility of a Government 
        contractor or subcontractor.
  ``(e) Definitions.--As used in this section:
          ``(1) The term `contractor bid or proposal information' means 
        any of the following information submitted to a Federal agency 
        as part of or in connection with a bid or proposal to enter 
        into a Federal agency procurement contract, if that information 
        has not been previously made available to the public or 
        disclosed publicly:
                  ``(A) Cost or pricing data (as defined by section 
                2306a(h) of title 10, United States Code, with respect 
                to procurements subject to that section, and section 
                304A(h) of Federal Property and Administrative Services 
                Act of 1949 (41 U.S.C. 254b(h), with respect to 
                procurements subject to that section).
                  ``(B) Indirect costs and direct labor rates.
                  ``(C) Proprietary information about manufacturing 
                processes, operations, or techniques marked by the 
                contractor in accordance with applicable law or 
                regulation.
                  ``(D) Information marked by the contractor as 
                `contractor bid or proposal information', in accordance 
                with applicable law or regulation.
          ``(2) The term `source selection information' means any of 
        the following information prepared for use by a Federal agency 
        for the purpose of evaluating a bid or proposal to enter into a 
        Federal agency procurement contract, if that information has 
        not been previously made available to the public or disclosed 
        publicly:
                  ``(A) Bid prices submitted in response to a Federal 
                agency solicitation for sealed bids, or lists of those 
                bid prices before public bid opening.
                  ``(B) Proposed costs or prices submitted in response 
                to a Federal agency solicitation, or lists of those 
                proposed costs or prices.
                  ``(C) Source selection plans.
                  ``(D) Technical evaluation plans.
                  ``(E) Technical evaluations of proposals.
                  ``(F) Cost or price evaluations of proposals.
                  ``(G) Competitive range determinations that identify 
                proposals that have a reasonable chance of being 
                selected for award of a contract.
                  ``(H) Rankings of bids, proposals, or competitors.
                  ``(I) The reports and evaluations of source selection 
                panels, boards, or advisory councils.
                  ``(J) Other information marked as `source selection 
                information' based on a case-by-case determination by 
                the head of the agency, his designee, or the 
                contracting officer that its disclosure would 
                jeopardize the integrity or successful completion of 
                the Federal agency procurement to which the information 
                relates.
          ``(3) The term `Federal agency' has the meaning provided such 
        term in section 3 of the Federal Property and Administrative 
        Services Act of 1949 (40 U.S.C. 472).
          ``(4) The term `Federal agency procurement' means the 
        acquisition (by using competitive procedures and awarding a 
        contract) of goods or services (including construction) from 
        non-Federal sources by a Federal agency using appropriated 
        funds.
          ``(5) The term `contracting officer' means a person who, by 
        appointment in accordance with applicable regulations, has the 
        authority to enter into a Federal agency procurement contract 
        on behalf of the Government and to make determinations and 
        findings with respect to such a contract.
          ``(6) The term `protest' means a written objection by an 
        interested party to the award or proposed award of a Federal 
        agency procurement contract, pursuant to title IV of the 
        Federal Acquisition Reform Act of 1995.
  ``(f) Limitation on Protests.--No person may file a protest against 
the award or proposed award of a Federal agency procurement contract 
alleging an offense under subsection (a), (b), or (c), of this section, 
nor may the Defense Board or the Civilian Board consider such an 
allegation in deciding a protest, unless that person reported to the 
Federal agency responsible for the procurement information that the 
person believed constituted evidence of the offense no later than 14 
days after the person first discovered the possible offense.
  ``(g) Savings Provisions.--This section does not--
          ``(1) restrict the disclosure of information to, or its 
        receipt by, any person or class of persons authorized, in 
        accordance with applicable agency regulations or procedures, to 
        receive that information;
          ``(2) restrict a contractor from disclosing its own bid or 
        proposal information or the recipient from receiving that 
        information;
          ``(3) restrict the disclosure or receipt of information 
        relating to a Federal agency procurement after it has been 
        canceled by the Federal agency before contract award unless the 
        Federal agency plans to resume the procurement;
          ``(4) prohibit individual meetings between a Federal agency 
        employee and an offeror or potential offeror for, or a 
        recipient of, a contract or subcontract under a Federal agency 
        procurement, provided that unauthorized disclosure or receipt 
        of contractor bid or proposal information or source selection 
        information does not occur;
          ``(5) authorize the withholding of information from, nor 
        restrict its receipt by, Congress, a committee or subcommittee 
        of Congress, the Comptroller General, a Federal agency, or an 
        inspector general of a Federal agency;
          ``(6) authorize the withholding of information from, nor 
        restrict its receipt by, the Defense Board or the Civilian 
        Board in the course of a protest against the award or proposed 
        award of a Federal agency procurement contract; or
          ``(7) limit the applicability of any requirements, sanctions, 
        contract penalties, and remedies established under any other 
        law or regulation.''.
  (b) Repeals.--The following provisions of law are repealed:
          (1) Sections 2397, 2397a, 2397b, and 2397c of title 10, 
        United States Code.
          (2) Section 33 of the Federal Energy Administration Act of 
        1974 (15 U.S.C. 789).
          (3) Section 281 of title 18, United States Code.
          (4) Subsection (c) of section 32 of the Office of Federal 
        Procurement Policy Act (41 U.S.C. 428).
          (5) The first section 19 of the Federal Nonnuclear Energy 
        Research and Development Act of 1974 (42 U.S.C. 5918).
  (c) Clerical Amendments.--
          (1) The table of sections at the beginning of chapter 141 of 
        title 10, United States Code, is amended by striking out the 
        items relating to sections 2397, 2397a, 2397b, and 2397c.
          (2) The table of sections at the beginning of chapter 15 of 
        title 18, United States Code, is amended by striking out the 
        item relating to section 281.
          (3) Section 32 of the Office of Federal Procurement Policy 
        Act (41 U.S.C. 428) is amended by redesignating subsections 
        (d), (e), (f), and (g) as subsections (c), (d), (e), and (f), 
        respectively.

SEC. 306. FURTHER ACQUISITION STREAMLINING PROVISIONS.

  (a) Purpose of Office of Federal Procurement Policy.--(1) Section 
5(a) of the Office of Federal Procurement Policy Act (41 U.S.C. 404) is 
amended to read as follows:
  ``(a) To promote economy, efficiency, and effectiveness in the 
procurement of property and services by the executive branch of the 
Federal Government, there shall be an Office of Federal Procurement 
Policy (hereinafter referred to as the `Office') in the Office of 
Management and Budget to provide overall direction of Government-wide 
procurement policies, regulations, procedures, and forms for executive 
agencies.''.
  (2) Sections 2 and 3 of such Act (41 U.S.C. 401 and 402) are 
repealed.
  (b) Repeal of Report Requirement.--Section 8 of the Office of Federal 
Procurement Policy Act (41 U.S.C. 407) is repealed.
  (c) Repeal of Obsolete Provisions.--(1) Sections 10 and 11 of the 
Office of Federal Procurement Policy Act (41 U.S.C. 409 and 410) are 
repealed.
  (d) Clerical Amendments.--The table of contents for the Office of 
Federal Procurement Policy Act (contained in section 1(b)) is amended 
by striking out the items relating to sections 2, 3, 8, 10, and 11.
SEC. 307. JUSTIFICATION OF MAJOR DEFENSE ACQUISITION PROGRAMS NOT 
                    MEETING GOALS.

  Section 2220(b) of title 10, United States Code, is amended by adding 
at the end the following: ``In addition, the Secretary shall include in 
such annual report a justification for the continuation of any program 
that--
          ``(1) is more than 50 percent over the cost goal established 
        for the development, procurement, or operational phase of the 
        program;
          ``(2) fails to achieve at least 50 percent of the performance 
        capability goals established for the development, procurement, 
        or operational phase of the program; or
          ``(3) is more than 50 percent behind schedule, as determined 
        in accordance with the schedule goal established for the 
        development, procurement, or operational phase of the 
        program.''.

SEC. 308. ENHANCED PERFORMANCE INCENTIVES FOR ACQUISITION WORKFORCE.

  (a) Armed Services Acquisitions.--Subsection (b) of section 5001 of 
the Federal Acquisition Streamlining Act of 1994 (Public Law 103-355; 
108 Stat. 3350; 10 U.S.C. 2220 note) is amended--
          (1) by redesignating paragraphs (1) and (2) as subparagraphs 
        (A) and (B), respectively;
          (2) by designating the second sentence as paragraph (2);
          (3) by inserting ``(1)'' after ``(b) Enhanced System of 
        Performance Incentives.--''; and
          (4) by adding at the end the following:
  ``(3) The Secretary shall include in the enhanced system of 
incentives the following:
          ``(A) Pay bands.
          ``(B) Significant and material pay and promotion incentives 
        to be awarded, and significant and material unfavorable 
        personnel actions to be imposed, under the system exclusively, 
        or primarily, on the basis of the contributions of personnel to 
        the performance of the acquisition program in relation to cost 
        goals, performance goals, and schedule goals.
          ``(C) Provisions for pay incentives and promotion incentives 
        to be awarded under the system.''.
  (b) Civilian Agency Acquisitions.--Subsection (c) of section 5051 of 
the Federal Acquisition Streamlining Act of 1994 (Public Law 103-355; 
108 Stat. 3351; 41 U.S.C. 263 note) is amended--
          (1) by redesignating subparagraphs (A) and (B) of paragraph 
        (2) as clauses (i) and (ii), respectively;
          (2) by redesignating paragraphs (1) and (2) as subparagraphs 
        (A) and (B), respectively;
          (3) by inserting ``(1)'' after ``(c) Enhanced System of 
        Performance Incentives.--''; and
          (4) by adding at the end the following:
  ``(2) The Deputy Director shall include in the enhanced system of 
incentives under paragraph (1)(B) the following:
          ``(A) Pay bands.
          ``(B) Significant and material pay and promotion incentives 
        to be awarded, and significant and material unfavorable 
        personnel actions to be imposed, under the system exclusively, 
        or primarily, on the basis of the contributions of personnel to 
        the performance of the acquisition program in relation to cost 
        goals, performance goals, and schedule goals.
          ``(C) Provisions for pay incentives and promotion incentives 
        to be awarded under the system.''.
SEC. 309. RESULTS ORIENTED ACQUISITION PROGRAM CYCLE.

  Section 5002(a) of the Federal Acquisition Streamlining Act of 1994 
(Public Law 103-355; 108 Stat. 3350) is amended--
  (1) by inserting ``(1)'' before ``to ensure''; and
  (2) by striking out the period at the end and inserting in lieu 
thereof the following: ``; (2) to ensure that the regulations compress 
the time periods associated with developing, procuring, and making 
operational new systems; and (3) to ensure that Department of Defense 
directives relating to development and procurement of information 
systems (numbered in the 8000 series) and the Department of Defense 
directives numbered in the 5000 series are consolidated into one series 
of directives that is consistent with such compressed time periods.''.

SEC. 310. RAPID CONTRACTING GOAL.

  (a) Goal.--The Office of Federal Procurement Policy Act, as amended 
by section 106, is further amended by adding at the end the following 
new section:

``SEC. 36. RAPID CONTRACTING GOAL.

  ``The Administrator for Federal Procurement Policy shall establish a 
goal of reducing by 50 percent the time necessary for executive 
agencies to acquire an item for the user of that item.''.
  (b) Clerical Amendment.--The table of contents for such Act, 
contained in section 1(b), is amended by adding at the end the 
following new item:

``Sec. 36. Rapid contracting goal.''.
SEC. 311. ENCOURAGEMENT OF MULTIYEAR CONTRACTING.

  (a) Armed Services Acquisitions.--Section 2306b(a) of title 10, 
United States Code, is amended in the matter preceding paragraph (1) by 
striking out ``may'' and inserting in lieu thereof ``shall, to the 
maximum extent possible,''.
  (b) Civilian Agency Acquisitions.--Section 304B(a) of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 254c(a)) is 
amended in the matter preceding paragraph (1) by striking out ``may'' 
and inserting in lieu thereof ``shall, to the maximum extent 
possible,''.

SEC. 312. CONTRACTOR SHARE OF GAINS AND LOSSES FROM COST, SCHEDULE, AND 
                    PERFORMANCE EXPERIENCE.

  (a) Armed Services Acquisitions.--(1) Chapter 137 of title 10, United 
States Code, is amended by inserting after section 2306b the following 
new section:

``Sec. 2306c. Contractor share of gains and losses from cost, schedule, 
                    and performance experience

  ``The Federal Acquisition Regulation shall contain provisions to 
ensure that, for any cost-type contract or incentive-type contract, the 
contractor may be rewarded for contract performance exceeding the 
contract cost, schedule, or performance parameters to the benefit of 
the United States and may be penalized for failing to adhere to cost, 
schedule, or performance parameters to the detriment of the United 
States.''.
  (2) The table of sections at the beginning of such chapter is amended 
by inserting after the item relating to section 2306b the following new 
item:

``2306c. Contractor share of gains and losses from cost, schedule, and 
performance experience.''.

  (b) Civilian Agency Acquisitions.--(1) Title III of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 251 et 
seq.) is amended by inserting after section 304C the following new 
section:

``SEC. 304D. CONTRACTOR SHARE OF GAINS AND LOSSES FROM COST, SCHEDULE, 
                    AND PERFORMANCE EXPERIENCE.

  ``The Federal Acquisition Regulation shall contain provisions to 
ensure that, for any cost-type contract or incentive-type contract, the 
contractor may be rewarded for contract performance exceeding the 
contract cost, schedule, or performance parameters to the benefit of 
the United States and may be penalized for failing to adhere to cost, 
schedule, or performance parameters to the detriment of the United 
States.''.
  (2) The table of contents for such Act, contained in section 1(b), is 
amended by inserting after the item relating to section 304C the 
following new item:

``Sec. 304D. Contractor share of gains and losses from cost, schedule, 
and performance experience.''.
SEC. 313. PHASE FUNDING OF DEFENSE ACQUISITION PROGRAMS.

  Chapter 131 of title 10, United States Code, is amended by adding at 
the end the following new section:

``Sec. 2221. Funding for results oriented acquisition program cycle

  ``Before initial funding is made available for the development, 
procurement, or operational phase of an acquisition program for which 
an authorization of appropriations is required by section 114 of this 
title, the Secretary of Defense shall submit to Congress information 
about the objectives and plans for the conduct of that phase and the 
funding requirements for the entire phase. The information shall 
identify the intended user of the system to be acquired under the 
program and shall include objective, quantifiable criteria for 
assessing the extent to which the objectives and goals determined 
pursuant to section 2435 of this title are achieved.''.
  (2) The table of sections at the beginning of such chapter is amended 
by adding at the end the following new item:

``2221. Funding for results oriented acquisition program cycle.''.
SEC. 314. IMPROVED DEPARTMENT OF DEFENSE CONTRACT PAYMENT PROCEDURES.

  (a) Review and Improvement of Procedures.--The Comptroller General of 
the United States shall review commercial practices regarding accounts 
payable and, considering the results of the review, develop standards 
for the Secretary of Defense to consider using for improving the 
contract payment procedures and financial management systems of the 
Department of Defense.
  (b) GAO Report.--Not later than September 30, 1996, the Comptroller 
General shall submit to Congress a report containing the following 
matters:
          (1) The weaknesses in the financial management processes of 
        the Department of Defense.
          (2) Deviations of the Department of Defense payment 
        procedures and financial management systems from the standards 
        developed pursuant to subsection (a), expressed quantitatively.
          (3) The officials of the Department of Defense who are 
        responsible for resolving the deviations.

SEC. 315. CONSIDERATION OF PAST PERFORMANCE IN ASSIGNMENT TO 
                    ACQUISITION POSITIONS.

  (a) Requirement.--Section 1701(a) of title 10, United States Code, is 
amended by adding at the end the following: ``The policies and 
procedures shall provide that education and training in acquisition 
matters, and past performance of acquisition responsibilities, are 
major factors in the selection of personnel for assignment to 
acquisition positions in the Department of Defense.''.
  (b) Performance Requirements for Assignment.--(1) Section 1723(a) of 
title 10, United States Code, is amended by inserting ``, including 
requirements relating to demonstrated past performance of acquisition 
duties,'' in the first sentence after ``experience requirements''.
  (2) Section 1724(a)(2) of such title is amended by inserting before 
the semicolon at the end the following: ``and have demonstrated 
proficiency in the performance of acquisition duties in the contracting 
position or positions previously held''.
  (3) Section 1735 of such title is amended--
          (A) in subsection (b)--
                  (i) by striking out ``and'' at the end of paragraph 
                (2);
                  (ii) by striking out the period at the end of 
                paragraph (3) and inserting in lieu thereof ``; and''; 
                and
                  (iii) by adding at the end the following:
          ``(4) must have demonstrated proficiency in the performance 
        of acquisition duties.'';
          (B) in subsection (c)--
                  (i) by striking out ``and'' at the end of paragraph 
                (2);
                  (ii) by striking out the period at the end of 
                paragraph (3) and inserting in lieu thereof ``; and''; 
                and
                  (iii) by adding at the end the following:
          ``(4) must have demonstrated proficiency in the performance 
        of acquisition duties.'';
          (C) in subsection (d), by inserting before the period at the 
        end the following: ``, and have demonstrated proficiency in the 
        performance of acquisition duties''; and
          (D) in subsection (e), by inserting before the period at the 
        end the following: ``, and have demonstrated proficiency in the 
        performance of acquisition duties''.
SEC. 316. ADDITIONAL DEPARTMENT OF DEFENSE PILOT PROGRAMS.

  (a) Additional Program Authorized for Participation in Defense 
Acquisition Pilot Program.--Section 5064 of the Federal Acquisition 
Streamlining Act of 1994 (P.L. 103-355; 108 Stat. 3359) is amended as 
follows:
          (1) Subsection (a) is amended by adding at the end the 
        following new paragraph:
          ``(6) Joint standoff weapon unitary variant (jsow-uv).--The 
        Joint Standoff Weapon Unitary Variant program with respect to 
        all contracts directly related to the development and 
        procurement of an air-delivered, standoff weapon that 
        incorporates a global positioning system-aided inertial 
        navigation system, a data link capability, and a unitary 
        warhead.''.
          (2) Subsection (c) is amended--
                  (A) by striking out ``and'' at the end of paragraph 
                (1);
                  (B) by striking out the period at the end of 
                paragraph (2) and inserting in lieu thereof ``; and''; 
                and
                  (C) by adding at the end the following new paragraph:
          ``(3) with respect to the program described in subsection 
        (a)(6)--
                  ``(A) to apply any amendment or repeal of a provision 
                of law made in the Federal Acquisition Reform Act of 
                1995 to the pilot program before the effective date of 
                such amendment or repeal; and
                  ``(B) to apply to a procurement of items other than 
                commercial items under such program any waiver or 
                exception applicable under the Federal Acquisition 
                Streamlining Act of 1994 (Public Law 103-355) or the 
                Federal Acquisition Reform Act of 1995 (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.''.
  (b) Defense Acquisition Facility-Wide Pilot Program.--
          (1) Authority to conduct 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.
          (2) Scope of program.--At a facility designated as a 
        participant in the pilot program, the pilot program shall 
        consist of the following:
                  (A) All contracts and subcontracts for defense 
                supplies and services that are performed at the 
                facility.
                  (B) All contracts and subcontracts 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.
          (3) Designation of participating facilities.--(A) The 
        Secretary may designate up to three facilities as participants 
        in the defense facility-wide pilot program.
          (B) Subject to paragraph (7), the Secretary may determine the 
        scope and duration of a designation made under this paragraph.
          (4) Criteria for designation.--The Secretary may designate a 
        facility under paragraph (3) only if the Secretary determines 
        that all or substantially all of the contracts to be awarded 
        and performed at the facility after the designation, and all or 
        substantially all of the subcontracts to be awarded under those 
        contracts and performed at the facility after the designation, 
        will be--
                  (A) for the production of supplies or services on a 
                firm-fixed price basis;
                  (B) 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
                  (C) 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)).
          (5) 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--
                  (A) is within the scope of the pilot program (as 
                described in paragraph (2)); and
                  (B) is fairly and reasonably priced based on 
                information other than certified cost and pricing data.
          (6) Special authority.--The authority provided under 
        paragraph (1) may include authority for the Secretary of 
        Defense--
                  (A) to apply any amendment or repeal of a provision 
                of law made in this Act to the pilot program before the 
                effective date of such amendment or repeal; and
                  (B) to apply to a procurement of items other than 
                commercial items under such program--
                          (i) any authority provided in the Federal 
                        Acquisition Streamlining Act of 1994 (Public 
                        Law 103-355) (or in an amendment made by a 
                        provision of that Act) to waive a provision of 
                        law in the case of commercial items, and
                          (ii) any exception applicable under this Act 
                        or the Federal Acquisition Streamlining Act of 
                        1994 (Public Law 103-355) (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.
          (7) Applicability.--(A) Paragraphs (5) and (6) apply with 
        respect to--
                  (i) a contract that is awarded or modified during the 
                period described in subparagraph (B); and
                  (ii) a contract that is awarded before the beginning 
                of such period and is to be performed (or may be 
                performed), in whole or in part, during such period.
          (B) The period referred to in subparagraph (A) is the period 
        that begins 45 days after the date of the enactment of this Act 
        and ends on September 30, 1998.
          (8) 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 the law, adopt commercial practices in the 
        administration of contracts and subcontracts. Such commercial 
        practices may include elimination of Government audit and 
        access to records provisions; incorporation of commercial 
        oversight, inspection, and acceptance procedures; use of 
        alternative dispute resolution techniques (including 
        arbitration); and elimination of contract provisions 
        authorizing the Government to make unilateral changes to 
        contracts.
SEC. 317. VALUE ENGINEERING FOR FEDERAL AGENCIES.

  (a) Use of Value Engineering.--The Office of Federal Procurement 
Policy Act (41 U.S.C. 401 et seq.), as amended by section 310, is 
further amended by adding at the end the following new section:

``SEC. 37. VALUE ENGINEERING.

  ``(a) In General.--Each executive agency shall establish and maintain 
effective value engineering procedures and processes.
  ``(b) Threshold.--The procedures and processes established pursuant 
to subsection (a) shall be applied to those programs, projects, 
systems, and products of an executive agency that, in a ranking of all 
programs, projects, systems, and products of the agency according to 
greatest dollar value, are within the highest 20th percentile.
  ``(c) Definition.--As used in this section, the term `value 
engineering' means a team effort, performed by qualified agency or 
contractor personnel, directed at analyzing the functions of a program, 
project, system, product, item of equipment, building, facility, 
service, or supply for the purpose of achieving the essential functions 
at the lowest life-cycle cost that is consistent with required or 
improved performance, reliability, quality, and safety.''.
  (b) Clerical Amendment.--The table of contents for such Act, 
contained in section 1(b), is amended by adding at the end the 
following new item:

``Sec. 37. Value engineering.''.
SEC. 318. ACQUISITION WORKFORCE.

  (a) Acquisition Workforce.--(1) The Office of Federal Procurement 
Policy Act (41 U.S.C. 401 et seq.), as amended by section 317, is 
further amended by adding at the end the following new section:

``SEC. 38. ACQUISITION WORKFORCE.

  ``(a) Applicability.--This section does not apply to an executive 
agency that is subject to chapter 87 of title 10, United States Code.
  ``(b) Management Policies.--
          ``(1) Policies and procedures.--The head of each executive 
        agency, after consultation with the Administrator for Federal 
        Procurement Policy, shall establish policies and procedures for 
        the effective management (including accession, education, 
        training, career development, and performance incentives) of 
        the acquisition workforce of the agency. The development of 
        acquisition workforce policies under this section shall be 
        carried out consistent with the merit system principles set 
        forth in paragraphs (1) and (2) of section 2301(b) of title 5, 
        United States Code.
          ``(2) Uniform implementation.--The head of each executive 
        agency shall ensure that, to the maximum extent practicable, 
        acquisition workforce policies and procedures established are 
        uniform in their implementation throughout the agency.
          ``(3) Government-wide policies and evaluation.--The 
        Administrator shall issue policies to promote uniform 
        implementation of this section by executive agencies, with due 
        regard for differences in program requirements among agencies 
        that may be appropriate and warranted in view of the agency 
        mission. The Administrator shall coordinate with the Deputy 
        Director for Management of the Office of Management and Budget 
        to ensure that such policies are consistent with the policies 
        and procedures established and enhanced system of incentives 
        provided pursuant to section 5051(c) of the Federal Acquisition 
        Streamlining Act of 1994 (41 U.S.C. 263 note). The 
        Administrator shall evaluate the implementation of the 
        provisions of this section by executive agencies.
  ``(c) Senior Procurement Executive Authorities and 
Responsibilities.--Subject to the authority, direction, and control of 
the head of an executive agency, the senior procurement executive of 
the agency shall carry out all powers, functions, and duties of the 
head of the agency with respect to implementation of this section. The 
senior procurement executive shall ensure that the policies of the head 
of the executive agency established in accordance with this section are 
implemented throughout the agency.
  ``(d) Management Information Systems.--The Administrator shall ensure 
that the heads of executive agencies collect and maintain standardized 
information on the acquisition workforce related to implementation of 
this section. To the maximum extent practicable, such data requirements 
shall conform to standards established by the Office of Personnel 
Management for the Central Personnel Data File.
  ``(e) Acquisition Workforce.--The programs established by this 
section shall apply to all employees in the General Schedule 
Contracting series (GS-1102) and the General Schedule Purchasing series 
(GS-1105), and to any employees regardless of series who have been 
appointed as contracting officers whose authority exceeds the micro-
purchase threshold, as that term is defined in section 32(g). The head 
of each executive agency may include employees in other series who 
perform acquisition or acquisition-related functions.
  ``(f) Career Development.--
          ``(1) Career paths.--The head of each executive agency shall 
        ensure that appropriate career paths for personnel who desire 
        to pursue careers in acquisition are identified in terms of the 
        education, training, experience, and assignments necessary for 
        career progression to the most senior acquisition positions. 
        The head of each executive agency shall make information 
        available on such career paths.
          ``(2) Critical duties and tasks.--For each career path, the 
        head of each executive agency shall identify the critical 
        acquisition-related duties and tasks in which, at minimum, 
        employees of the agency in the career path shall be competent 
        to perform at full performance grade levels. For this purpose, 
        the head of the executive agency shall provide appropriate 
        coverage of the critical duties and tasks identified by the 
        Director of the Federal Acquisition Institute.
          ``(3) Mandatory training and education.--For each career 
        path, the head of each executive agency shall establish 
        requirements for the completion of course work and related on-
        the-job training in the critical acquisition-related duties and 
        tasks of the career path. The head of each executive agency 
        shall also encourage employees to maintain the currency of 
        their acquisition knowledge and generally enhance their 
        knowledge of related acquisition management disciplines through 
        academic programs and other self-developmental activities.
          ``(4) Performance incentives.--The head of each executive 
        agency, acting through the senior procurement executive for the 
        agency, shall provide for an enhanced system of incentives for 
        the encouragement of excellence in the acquisition workforce 
        which rewards performance of employees that contribute to 
        achieving the agency's performance goals. The system of 
        incentives shall include provisions that--
                  ``(A) relate pay to performance;
                  ``(B) provide for consideration, in personnel 
                evaluations and promotion decisions, of the extent to 
                which the performance of personnel contributed to 
                achieving the agency's performance goals; and
                  ``(C) provide pay and promotion incentives to be 
                awarded, and unfavorable personnel actions to be 
                imposed, under the system on the basis of the 
                contributions of personnel to achieving the agency's 
                performance goals.
  ``(g) Qualification Requirements.--
          ``(1) General schedule contracting series (gs-1102).--
                  ``(A) Entry level qualifications.--The Director of 
                the Office of Personnel Management shall require that, 
                after October 1, 1996, a person may not be appointed to 
                a position in the GS-1102 occupational series unless 
                the person--
                          ``(i) has received a baccalaureate degree 
                        from an accredited educational institution 
                        authorized to grant baccalaureate degrees,
                          ``(ii) has 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, economics, industrial management, 
                        marketing, quantitative methods, or 
                        organization and management, or
                          ``(iii) has passed a written test determined 
                        by the Administrator for Federal Procurement 
                        Policy, after consultation with the Director of 
                        the Office of Personnel Management, to 
                        demonstrate the judgmental skills necessary for 
                        positions in this series.
                  ``(B) Qualifications for senior contracting 
                positions.--The Director of the Office of Personnel 
                Management shall require that, after October 1, 1996, 
                persons may be appointed to positions at and above full 
                performance grade levels in the GS-1102 occupational 
                series only if those persons--
                          ``(i) have satisfied the educational 
                        requirement either of subparagraph (A)(i) or 
                        (A)(ii),
                          ``(ii) have successfully completed all 
                        training required for the position under 
                        subsection (f)(3), and
                          ``(iii) have satisfied experience and other 
                        requirements established by the Director for 
                        such positions.
                However, this requirement shall apply to persons 
                employed on October 1, 1996, in GS-1102 positions at 
                those grade levels only as a prerequisite for promotion 
                to a GS-1102 position at a higher grade.
          ``(2) General schedule purchasing series (gs-1105).--The 
        Director of the Office of Personnel Management shall require 
        that, after October 1, 1996, a person may not be appointed to a 
        position in the GS-1105 occupational series unless the person--
                  ``(A) has successfully completed 2 years of course 
                work from an accredited educational institution 
                authorized to grant degrees, or
                  ``(B) has passed a written test determined by the 
                Administrator for Federal Procurement Policy, after 
                consultation with the Director of the Office of 
                Personnel Management, to demonstrate the judgmental 
                skills necessary for positions in this series.
          ``(3) Contracting officers.--The head of each executive 
        agency shall require that, beginning after October 1, 1996, a 
        person may be appointed as a contracting officer with authority 
        to award or administer contracts for amounts above the micro-
        purchase threshold, as that term is defined in section 32(g), 
        only if the person--
                  ``(A) has successfully completed all mandatory 
                training required of an employee in an equivalent GS-
                1102 or 1105 position under subsection (f)(3); and
                  ``(B) meets experience and other requirements 
                established by the head of the agency, based on the 
                dollar value and complexity of the contracts that the 
                employee will be authorized to award or administer 
                under the appointment as a contracting officer.
          ``(4) Exceptions.--(A) The requirements set forth in 
        paragraphs (1) and (2), as applicable, shall not apply to any 
        person employed in the GS-1102 or GS-1105 series on October 1, 
        1996.
          ``(B) Employees of an executive agency who do not satisfy the 
        full qualification requirements for appointment as a 
        contracting officer under paragraph (3) may be appointed as a 
        contracting officer for a temporary period of time under 
        procedures established by the agency head. The procedures 
        shall--
                  ``(i) require that the person have completed a 
                significant portion of the required training,
                  ``(ii) require a plan be established for the balance 
                of the required training,
                  ``(iii) specify a period of time for completion of 
                the training, and
                  ``(iv) include provisions for withdrawing or 
                terminating the appointment prior to the scheduled 
                expiration date, where appropriate.
          ``(5) Waiver.--The senior procurement executive for an 
        executive agency may waive any or all of the qualification 
        requirements of paragraphs (1) and (2) for a person if the 
        person possesses significant potential for advancement to 
        levels of greater responsibility and authority, based on 
        demonstrated job performance and qualifying experience. This 
        authority may not be redelegated by the senior procurement 
        executive. With respect to each waiver granted under this 
        subsection, the senior procurement executive shall set forth in 
        writing the rationale for the decision to waive such 
        requirements.
  ``(h) Program Establishment and Implementation.--
          ``(1) Funding levels.--(A) The head of an executive agency 
        shall request in the budget for a fiscal year for the agency--
                  ``(i) for education and training under this section, 
                an amount equal to no less than 2.5 percent of the base 
                aggregate salary cost of the acquisition workforce 
                subject to this section for that fiscal year; and
                  ``(ii) for salaries of the acquisition workforce, an 
                amount equal to no more than 97.5 percent of such base 
                aggregate salary cost.
          ``(B) The head of the executive agency shall set forth 
        separately the funding levels requested in the budget 
        justification documents submitted in support of the President's 
        budget submitted to Congress under section 1105 of title 31, 
        United States Code.
          ``(C) Funds appropriated for education and training under 
        this section may not be obligated or used for any other 
        purpose.
          ``(2) Interagency agreements.--The head of an executive 
        agency may enter into a written agreement with another agency 
        to participate in programs established under this section on a 
        reimbursable basis.
          ``(3) Tuition assistance.--Notwithstanding the prohibition in 
        section 4107(b) of title 5, United States Code, the head of 
        each executive agency may provide for tuition reimbursement and 
        education (including a full-time course of study leading to a 
        degree) for acquisition personnel in the agency related to the 
        purposes of this section.
          ``(4) Intern programs.--The head of each executive agency may 
        establish intern programs in order to recruit highly qualified 
        and talented individuals and provide them with opportunities 
        for accelerated promotions, career broadening assignments, and 
        specified training for advancement to senior acquisition 
        positions. For such programs, the head of an executive agency, 
        without regard to the provisions of title 5, United States 
        Code, may appoint individuals to competitive GS-5, GS-7, or GS-
        9 positions in the General Schedule Contracting series (GS-
        1102) who have graduated from baccalaureate or master's 
        programs in purchasing or contracting from accredited 
        educational institutions authorized to grant baccalaureate and 
        master's degrees.
          ``(5) Cooperative education program.--The head of each 
        executive agency may establish an agencywide cooperative 
        education credit program for acquisition positions. Under the 
        program, the head of the executive agency may enter into 
        cooperative arrangements with one or more accredited 
        institutions of higher education which provide for such 
        institutions to grant undergraduate credit for work performed 
        in such position.
          ``(6) Scholarship program.--
                  ``(A) Establishment.--Where deemed appropriate, the 
                head of each executive agency may establish a 
                scholarship program for the purpose of qualifying 
                individuals for acquisition positions in the agency.
                  ``(B) Eligibility.--To be eligible to participate in 
                a scholarship program established under this paragraph 
                by an executive agency, an individual must--
                          ``(i) be accepted for enrollment or be 
                        currently enrolled as a full-time student at an 
                        accredited educational institution authorized 
                        to grant baccalaureate or graduate degrees (as 
                        appropriate);
                          ``(ii) be pursuing a course of education that 
                        leads toward completion of a bachelor's, 
                        master's, or doctor's degree (as appropriate) 
                        in a qualifying field of study, as determined 
                        by the head of the agency;
                          ``(iii) sign an agreement described in 
                        subparagraph (C) under which the participant 
                        agrees to serve a period of obligated service 
                        in the agency in an acquisition position in 
                        return for payment of educational assistance as 
                        provided in the agreement; and
                          ``(iv) meet such other requirements as the 
                        head of the agency prescribes.
                  ``(C) Agreement.--An agreement between the head of an 
                executive agency and a participant in a scholarship 
                program established under this paragraph shall be in 
                writing, shall be signed by the participant, and shall 
                include the following provisions:
                          ``(i) The agreement of the head of the agency 
                        to provide the participant with educational 
                        assistance for a specified number of school 
                        years, not to exceed 4, during which the 
                        participant is pursuing a course of education 
                        in a qualifying field of study. The assistance 
                        may include payment of tuition, fees, books, 
                        laboratory expenses, and a stipend.
                          ``(ii) The participant's agreement--
                                  ``(I) to accept such educational 
                                assistance,
                                  ``(II) to maintain enrollment and 
                                attendance in the course of education 
                                until completed,
                                  ``(III) while enrolled in such 
                                course, to maintain an acceptable level 
                                of academic standing (as prescribed by 
                                the head of the agency), and
                                  ``(IV) after completion of the course 
                                of education, to serve as a full-time 
                                employee in an acquisition position in 
                                the agency for a period of time of one 
                                calendar year for each school year or 
                                part thereof for which the participant 
                                was provided a scholarship under the 
                                program.
                  ``(D) Repayment.--(i) Any person participating in a 
                program established under this paragraph shall agree to 
                pay to the United States the total amount of 
                educational assistance provided to the person under the 
                program if the person is voluntarily separated from the 
                agency or involuntarily separated for cause from the 
                agency before the end of the period for which the 
                person has agreed to continue in the service of the 
                agency in an acquisition position.
                  ``(ii) If an employee fails to fulfill the agreement 
                to pay to the Government the total amount of 
                educational assistance provided to the person under the 
                program, a sum equal to the amount of the educational 
                assistance may be recovered by the Government from the 
                employee (or the estate of the employee) by setoff 
                against accrued pay, compensation, amount of retirement 
                credit, or other amount due the employee from the 
                Government; and by such other method as is provided by 
                law for the recovery of amounts owing to the 
                Government.
                  ``(iii) The head of an executive agency may waive in 
                whole or in part a repayment required under this 
                paragraph if the head of the agency determines the 
                recovery would be against equity and good conscience or 
                would be contrary to the best interests of the United 
                States.
                  ``(E) Termination of agreement.--There shall be no 
                requirement that a position be offered to a person 
                after such person successfully completes a course of 
                education required by an agreement under this 
                paragraph. If no position is offered, the agreement 
                shall be considered terminated.''.
  (2) The table of contents for such Act, contained in section 1(b), is 
amended by adding at the end the following new item:

``Sec. 38. Acquisition workforce.''.

  (b) Additional Amendments.--Section 6(d)(5) of the Office of Federal 
Procurement Policy Act (41 U.S.C. 405), is amended--
          (1) in subparagraph (A), by striking out ``Government-wide 
        career management programs for a professional procurement work 
        force'' and inserting in lieu thereof ``the development of a 
        professional acquisition workforce Government-wide'';
          (2) in subparagraph (B)--
                  (A) by striking out ``procurement by the'' and 
                inserting in lieu thereof ``acquisition by the''; and
                  (B) by striking out ``and'' at the end of the 
                subparagraph; and
          (3) by striking out subparagraph (C) and inserting in lieu 
        thereof the following:
                  ``(C) administer the provisions of section 38;
                  ``(D) collect data and analyze acquisition workforce 
                data from the Office of Personnel Management, the heads 
                of executive agencies, and, through periodic surveys, 
                from individual employees;
                  ``(E) periodically analyze acquisition career fields 
                to identify critical competencies, duties, tasks, and 
                related academic prerequisites, skills, and knowledge;
                  ``(F) coordinate and assist agencies in identifying 
                and recruiting highly qualified candidates for 
                acquisition fields;
                  ``(G) develop instructional materials for acquisition 
                personnel in coordination with private and public 
                acquisition colleges and training facilities;
                  ``(H) evaluate the effectiveness of training and 
                career development programs for acquisition personnel;
                  ``(I) promote the establishment and utilization of 
                academic programs by colleges and universities in 
                acquisition fields;
                  ``(J) facilitate, to the extent requested by 
                agencies, interagency intern and training programs; and
                  ``(K) perform other career management or research 
                functions as directed by the Administrator.''.
              TITLE IV--STREAMLINING OF DISPUTE RESOLUTION

                     Subtitle A--General Provisions

SEC. 401. DEFINITIONS.

  (a) In General.--The Office of Federal Procurement Policy Act (41 
U.S.C. 401 et seq.) is amended by adding at the end the following:

                     ``TITLE II--DISPUTE RESOLUTION

                    ``Subtitle A--General Provisions

``SEC. 201. DEFINITIONS.

  ``In this title:
          ``(1) The term `Defense Board' means the Department of 
        Defense Board of Contract Appeals established pursuant to 
        section 8(a) of the Contract Disputes Act of 1978 (41 U.S.C. 
        607).
          ``(2) The term `Civilian Board' means the Civilian Board of 
        Contract Appeals established pursuant to section 8(b) of the 
        Contract Disputes Act of 1978 (41 U.S.C. 607).
          ``(3) The term `Board judge' means a member of the Defense 
        Board or the Civilian Board, as the case may be.
          ``(4) The term `Chairman' means the Chairman of the Defense 
        Board or the Civilian Board, as the case may be.
          ``(5) The term `Board concerned' means--
                  ``(A) the Defense Board with respect to matters 
                within its jurisdiction; and
                  ``(B) the Civilian Board with respect to matters 
                within its jurisdiction.
          ``(6) The term `executive agency'--
                  ``(A) for purposes of contract disputes under section 
                213--
                          ``(i) with respect to contract disputes under 
                        the jurisdiction of the Defense Board, means 
                        the Department of Defense, the Department of 
                        the Army, the Department of the Navy, or the 
                        Department of the Air Force; and
                          ``(ii) with respect to contract disputes 
                        under the jurisdiction of the Civilian Board, 
                        has the meaning given by section 2(2) of the 
                        Contract Disputes Act of 1978 (41 U.S.C. 
                        601(2)) except that the term does not include 
                        the Department of Defense, the Department of 
                        the Army, the Department of the Navy, and the 
                        Department of the Air Force; and
                  ``(B) for purposes of protests under section 214--
                          ``(i) with respect to protests under the 
                        jurisdiction of the Defense Board, means the 
                        Department of Defense, the Department of the 
                        Army, the Department of the Navy, or the 
                        Department of the Air Force; and
                          ``(ii) with respect to protests under the 
                        jurisdiction of the Civilian Board, has the 
                        meaning given by section 4(1) of this Act 
                        except that the term does not include the 
                        Department of Defense, the Department of the 
                        Army, the Department of the Navy, and the 
                        Department of the Air Force.
          ``(7) The term `alternative means of dispute resolution' has 
        the meaning given by section 571(3) of title 5, United States 
        Code.
          ``(8) The term `protest' means a written objection by an 
        interested party to any of the following:
                  ``(A) A solicitation or other request by an executive 
                agency for offers for a contract for the procurement of 
                property or services.
                  ``(B) The cancellation of such a solicitation or 
                other request.
                  ``(C) An award or proposed award of such a contract.
                  ``(D) A termination or cancellation of an award of 
                such a contract, if the written objection contains an 
                allegation that the termination or cancellation is 
                based in whole or in part on improprieties concerning 
                the award of the contract.
          ``(9) The term `interested party', with respect to a contract 
        or a solicitation or other request for offers, means an actual 
        or prospective bidder or offeror whose direct economic interest 
        would be affected by the award of the contract or by failure to 
        award the contract.
          ``(10) The term `prevailing party', with respect to a 
        determination of the Board under section 214(h)(2) that a 
        decision of a contracting officer violates a statute or 
        regulation, means a party that demonstrated such violation.''.
  (b) Conforming Amendments.--The Office of Federal Procurement Policy 
Act (41 U.S.C. 401 et seq.) is further amended--
          (1) by inserting the following before section 1:

           ``TITLE I--FEDERAL PROCUREMENT POLICY GENERALLY'';

        and
          (2) in section 4, by striking out ``As used in this Act:'' 
        and inserting in lieu thereof ``Except as otherwise 
        specifically provided, as used in this Act:''.

 Subtitle B--Establishment of Civilian and Defense Boards of Contract 
                                Appeals

SEC. 411. ESTABLISHMENT.

  Subsections (a) and (b) of section 8 of the Contract Disputes Act of 
1978 (41 U.S.C. 607) are amended to read as follows:
  ``(a) There is established in the Department of Defense a board of 
contract appeals to be known as the Department of Defense Board of 
Contract Appeals.
  ``(b) There is established in the General Services Administration a 
board of contract appeals to be known as the Civilian Board of Contract 
Appeals.''.

SEC. 412. MEMBERSHIP.

  The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), 
as amended by section 401, is further amended by adding at the end the 
following:

``SEC. 202. MEMBERSHIP.

  ``(a) Appointment.--(1)(A) The Defense Board shall consist of judges 
appointed by the Chairman, without regard to political affiliation and 
solely on the basis of the professional qualifications required to 
perform the duties and responsibilities of a Defense Board judge, from 
a register of applicants maintained by the Defense Board.
  ``(B) The Civilian Board shall consist of judges appointed by the 
Chairman, without regard to political affiliation and solely on the 
basis of the professional qualifications required to perform the duties 
and responsibilities of a Civilian Board judge, from a register of 
applicants maintained by the Civilian Board.
  ``(2) The members of the Defense Board and the Civilian Board shall 
be selected and appointed to serve in the same manner as administrative 
law judges appointed pursuant to section 3105 of title 5, United States 
Code, with an additional requirement that such members shall have had 
not fewer than five years of experience in public contract law.
  ``(3) Notwithstanding paragraph (2) and subject to subsection (b), 
the following persons shall serve as Board judges:
          ``(A) For the Defense Board, any full-time member of the 
        Armed Services Board of Contract Appeals serving as such on the 
        day before the effective date of this title.
          ``(B) For the Civilian Board, any full-time member of any 
        agency board of contract appeals other than the Armed Services 
        Board of Contract Appeals serving as such on the day before the 
        effective date of this title.
          ``(C) For either the Defense Board or the Civilian Board, any 
        person serving on the day before the date of the enactment of 
        this title in a position at a level of assistant general 
        counsel or higher with authority delegated from the Comptroller 
        General to decide bid protests under subchapter V of chapter 35 
        of title 31, United States Code.
  ``(b) Removal.--Members of the Defense Board and the Civilian Board 
shall be subject to removal in the same manner as administrative law 
judges, as provided in section 7521 of title 5, United States Code.
  ``(c) Compensation.--Compensation for the Chairman of the Defense 
Board and the Chairman of the Civilian Board and all other members of 
each Board shall be determined under section 5372a of title 5, United 
States Code.''.
SEC. 413. CHAIRMAN.

  The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), 
as amended by section 412, is further amended by adding at the end the 
following:

``SEC. 203. CHAIRMAN.

  ``(a) Designation.--(1)(A) The Chairman of the Defense Board shall be 
designated by the Secretary of Defense to serve for a term of five 
years. The Secretary shall select the Chairman from among sitting 
judges each of whom has had at least five years of service--
          ``(i) as a member of the Armed Services Board of Contract 
        Appeals; or
          ``(ii) in a position at a level of assistant general counsel 
        or higher with authority delegated from the Comptroller General 
        to decide bid protests under subchapter V of chapter 35 of 
        title 31, United States Code (as in effect on the day before 
        the effective date of this title).
  ``(B) The Chairman of the Civilian Board shall be designated by the 
Administrator of General Services to serve for a term of five years. 
The Administrator shall select the Chairman from among sitting judges 
each of whom has had at least five years of service--
          ``(i) as a member of an agency board of contract appeals 
        other than the Armed Services Board of Contract Appeals; or
          ``(ii) in a position at a level of assistant general counsel 
        or higher with authority delegated from the Comptroller General 
        to decide bid protests under subchapter V of chapter 35 of 
        title 31, United States Code (as in effect on the day before 
        the effective date of this title).
  ``(2) A Chairman of a Board may continue to serve after the 
expiration of the Chairman's term until a successor has taken office. A 
Chairman may be reappointed any number of times.
  ``(b) Responsibilities.--The Chairman of the Defense Board or the 
Civilian Board, as the case may be, shall be responsible on behalf of 
the Board for the executive and administrative operation of the Board, 
including functions of the Board with respect to the following:
          ``(1) The selection, appointment, and fixing of the 
        compensation of such personnel, pursuant to part III of title 
        5, United States Code, as the Chairman considers necessary or 
        appropriate, including a Clerk of the Board, a General Counsel, 
        and clerical and legal assistance for Board judges.
          ``(2) The supervision of personnel employed by or assigned to 
        the Board, and the distribution of work among such personnel.
          ``(3) The operation of an Office of the Clerk of the Board, 
        including the receipt of all filings made with the Board, the 
        assignment of cases, and the maintenance of all records of the 
        Board.
          ``(4) The prescription of such rules and regulations as the 
        Chairman considers necessary or appropriate for the 
        administration and management of the Board.
  ``(c) Vice Chairmen.--The Chairman of the Defense Board or the 
Civilian Board, as the case may be, may designate up to four other 
Board judges as Vice Chairmen. The Chairman may divide the Board into 
two divisions, one for handling contract disputes and one for handling 
protests, and, if such division is made, shall assign a Vice Chairman 
to head each division. The Vice Chairmen, in the order designated by 
the Chairman, shall act in the place and stead of the Chairman during 
the absence of the Chairman.''.

SEC. 414. RULEMAKING AUTHORITY.

  The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), 
as amended by section 413, is further amended by adding at the end the 
following:

``SEC. 204. RULEMAKING AUTHORITY.

  ``The Chairman of the Defense Board and the Chairman of the Civilian 
Board shall jointly issue and maintain--
          ``(1) such procedural rules and regulations as are necessary 
        to the exercise of the functions of the Boards under sections 
        213 and 214; and
          ``(2) statements of policy of general applicability with 
        respect to such functions.''.

SEC. 415. AUTHORIZATION OF APPROPRIATIONS.

  The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), 
as amended by section 414, is further amended by adding at the end the 
following:

``SEC. 205. AUTHORIZATION OF APPROPRIATIONS.

  ``There are authorized to be appropriated for fiscal year 1997 and 
each succeeding fiscal year such sums as may be necessary to carry out 
the provisions of this title. Funds for the activities of each Board 
shall be separately appropriated for such purpose. Funds appropriate 
pursuant to this section shall remain available until expended.''.

   Subtitle C--Functions of Defense and Civilian Boards of Contract 
                                Appeals

SEC. 421. ALTERNATIVE DISPUTE RESOLUTION SERVICES.

  The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), 
as amended by section 415, is further amended by adding at the end the 
following:

``Subtitle B--Functions of the Defense and Civilian Boards of Contract 
                                Appeals

``SEC. 211. ALTERNATIVE DISPUTE RESOLUTION SERVICES.

  ``(a) Requirement To Provide Services Upon Request.--The Defense 
Board and the Civilian Board shall each provide alternative means of 
dispute resolution for any disagreement regarding a contract or 
prospective contract of an executive agency upon the request of all 
parties to the disagreement.
  ``(b) Personnel Qualified To Act.--Each Board judge and each attorney 
employed by the Board concerned shall be considered to be qualified to 
act for the purpose of conducting alternative means of dispute 
resolution under this section.
  ``(c) Services To Be Provided Without Charge.--Any services provided 
by the Board concerned or any Board judge or employee pursuant to this 
section shall be provided without charge.
  ``(d) Recusal of Certain Personnel Upon Request.--In the event that a 
matter which is presented to the Board concerned for alternative means 
of dispute resolution, pursuant to this section, later becomes the 
subject of formal proceedings before such Board, any Board judge or 
employee who was involved in the alternative means of dispute 
resolution shall, if requested by any party to the formal proceeding, 
take no part in that proceeding.''.

SEC. 422. ALTERNATIVE DISPUTE RESOLUTION OF DISPUTES AND PROTESTS 
                    SUBMITTED TO BOARDS.

  The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), 
as amended by section 421, is further amended by adding at the end the 
following:

``SEC. 212. ALTERNATIVE DISPUTE RESOLUTION OF DISPUTES AND PROTESTS 
                    SUBMITTED TO BOARDS.

  ``With reasonable promptness after the submission to the Defense 
Board or the Civilian Board of a contract dispute under section 213 or 
a bid protest under section 214, a Board judge to whom the contract 
dispute or protest is assigned shall request the parties to meet with a 
Board judge, or an attorney employed by the Board concerned, for the 
purpose of attempting to resolve the dispute or protest through 
alternative means of dispute resolution. Formal proceedings in the 
appeal shall then be suspended until such time as any party or a Board 
judge to whom the dispute or protest is assigned determines that 
alternative means of dispute resolution are not appropriate for 
resolution of the dispute or protest.''.

SEC. 423. CONTRACT DISPUTES.

  The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), 
as amended by section 422, is further amended by adding at the end the 
following:

``SEC. 213. CONTRACT DISPUTES.

  ``The Defense Board shall have jurisdiction as provided by section 
8(a) of the Contract Disputes Act of 1978 (41 U.S.C. 601-613). The 
Civilian Board shall have jurisdiction as provided by section 8(b) of 
such Act.''.
SEC. 424. PROTESTS.

  The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), 
as amended by section 423, is further amended by adding at the end the 
following:

``SEC. 214. PROTESTS.

  ``(a) Review Required Upon Request.--Upon request of an interested 
party in connection with any procurement conducted by an executive 
agency, the Defense Board or the Civilian Board, as the case may be, 
shall review, as provided in this section, any decision by the head of 
the executive agency alleged to violate a statute or regulation. A 
decision or order of the Board concerned pursuant to this section shall 
not be subject to interlocutory appeal or review.
  ``(b) Standard of Review.--In deciding a protest, the Board concerned 
may consider all evidence that is relevant to the decision under 
protest. It shall accord a presumption of correctness to the decision 
under protest. The protester may rebut such presumption by showing, by 
a preponderance of the evidence, that the decision was arbitrary or 
capricious or violated a statute or regulation.
  ``(c) Notification.--Within one day after the receipt of a protest, 
the Board concerned shall notify the executive agency involved of the 
protest.
  ``(d) Suspension of Contract Award.--(1) Except as provided in 
paragraph (2) of this subsection, a contract may not be awarded in any 
procurement after the executive agency has received notice of a protest 
with respect to such procurement from the Board concerned and while the 
protest is pending.
  ``(2) The head of the procuring activity responsible for award of a 
contract may authorize the award of the contract (notwithstanding a 
protest of which the executive agency has notice under this section)--
          ``(A) upon a written finding that urgent and compelling 
        circumstances which significantly affect interests of the 
        United States will not permit waiting for the decision of the 
        Board concerned under this section; and
          ``(B) after the Board concerned is advised of that finding.
  ``(3) A finding may not be made under paragraph (2)(A) of this 
subsection unless the award of the contract is otherwise likely to 
occur within 30 days after the making of such finding.
  ``(4) The suspension of the award under paragraph (1) shall not 
preclude the executive agency concerned from continuing the procurement 
process up to but not including the award of the contract.
  ``(e) Suspension of Contract Performance.--(1) A contractor awarded 
an executive agency contract may, during the period described in 
paragraph (4), begin performance of the contract and engage in any 
related activities that result in obligations being incurred by the 
United States under the contract unless the contracting officer 
responsible for the award of the contract withholds authorization to 
proceed with performance of the contract.
  ``(2) The contracting officer may withhold an authorization to 
proceed with performance of the contract during the period described in 
paragraph (4) if the contracting officer determines in writing that--
          ``(A) a protest is likely to be filed; and
          ``(B) the immediate performance of the contract is not in the 
        best interests of the United States.
  ``(3)(A) If the executive agency awarding the contract receives 
notice of a protest in accordance with this section during the period 
described in paragraph (4)--
          ``(i) the contracting officer may not authorize performance 
        of the contract to begin while the protest is pending; or
          ``(ii) if authorization for contract performance to proceed 
        was not withheld in accordance with paragraph (2) before 
        receipt of the notice, the contracting officer shall 
        immediately direct the contractor to cease performance under 
        the contract and to suspend any related activities that may 
        result in additional obligations being incurred by the United 
        States under that contract.
  ``(B) Performance and related activities suspended pursuant to 
subparagraph (A)(ii) by reason of a protest may not be resumed while 
the protest is pending.
  ``(C) The head of the procuring activity may authorize the 
performance of the contract (notwithstanding a protest of which the 
executive agency has notice under this section)--
          ``(i) upon a written finding that urgent and compelling 
        circumstances that significantly affect interests of the United 
        States will not permit waiting for the decision concerning the 
        protest by the Board concerned; and
          ``(ii) after the Board concerned is notified of that finding.
  ``(4) The period referred to in paragraphs (2) and (3)(A), with 
respect to a contract, is the period beginning on the date of the 
contract award and ending on the later of--
          ``(A) the date that is 10 days after the date of the contract 
        award; or
          ``(B) the date that is 5 days after the debriefing date 
        offered to an unsuccessful offeror for any debriefing that is 
        requested and, when requested, is required.
  ``(f) The authority of the head of the procuring activity to make 
findings and to authorize the award and performance of contracts under 
subsections (d) and (e) of this section may not be delegated.
  ``(g) Procedures.--
          ``(1) Proceedings and discovery.--The Board concerned shall 
        conduct proceedings and allow such discovery to the minimum 
        extent necessary for the expeditious, fair, and cost-effective 
        resolution of the protest. The Board concerned shall limit 
        discovery to material which is relevant to the grounds of 
        protest or to such affirmative defenses as the executive agency 
        involved, or any intervenor supporting the agency, may raise.
          ``(2) Priority.--The Board concerned shall give priority to 
        protests filed under this section over contract disputes and 
        alternative dispute services. Except as provided in paragraph 
        (3), the Board concerned shall issue its final decision within 
        65 days after the date of the filing of the protest, unless the 
        Chairman determines that the specific and unique circumstances 
        of the protest require a longer period, in which case the Board 
        concerned shall issue such decision within the longer period 
        determined by the Chairman. An amendment that adds a new ground 
        of protest should be resolved, to the maximum extent 
        practicable, within the time limits established for resolution 
        of the initial protest.
          ``(3) Threshold.--(A) Except as provided in subparagraph (B), 
        any protest in which the anticipated value of the contract 
        award that will result from the protested procurement, as 
        estimated by the executive agency involved, is less than 
        $20,000,000 shall be considered under simplified rules of 
        procedure. Such simplified rules shall provide that discovery 
        in such protests shall be in writing only. Such protests shall 
        be decided by a single Board judge. The Board concerned shall 
        issue its final decision in each such protest within 40 days 
        after the date of the filing of the protest, unless the 
        Chairman determines that the specific and unique circumstances 
        of the protest require a longer period, in which case the Board 
        concerned shall issue such decision within the longer period 
        determined by the Chairman.
          ``(B) If the Chairman of the Board concerned determines that 
        special and unique circumstances of a protest that would 
        otherwise qualify for the simplified rules described in 
        subparagraph (A), including the complexity of a protest, 
        requires the use of full procedures as described in paragraphs 
        (1) and (2), the Chairman shall use such procedures in lieu of 
        the simplified rules described in subparagraph (A).
          ``(4) Calculation of time for adr.--In calculating time for 
        purposes of paragraph (2) or (3) of this subsection, any days 
        during which proceedings are suspended for the purpose of 
        attempting to resolve the protest by alternative means of 
        dispute resolution, up to a maximum of 20 days, shall not be 
        counted.
          ``(5) Dismissal of frivolous protests.--The Board concerned 
        may dismiss a protest that the Board concerned determines--
                  ``(A) is frivolous,
                  ``(B) has been brought or pursued in bad faith; or
                  ``(C) does not state on its face a valid basis for 
                protest.
          ``(6) Payment of costs for frivolous protests.--(A) If the 
        Board concerned expressly finds that a protest or a portion of 
        a protest is frivolous or has been brought or pursued in bad 
        faith, the Board concerned shall declare that the protester or 
        other interested party who joins the protest is liable to the 
        United States for payment of the costs described in 
        subparagraph (B) unless--
                  ``(i) special circumstances would make such payment 
                unjust; or
                  ``(ii) the protester obtains documents or other 
                information after the protest is filed with the Board 
                concerned that establishes that the protest or a 
                portion of the protest is frivolous or has been brought 
                or pursued in bad faith, and the protester then 
                promptly withdraws the protest or portion of the 
                protest.
          ``(B) The costs referred to in subparagraph (A) are all of 
        the costs incurred by the United States of reviewing the 
        protest, or of reviewing that portion of the protest for which 
        the finding is made, including the fees and other expenses (as 
        defined in section 2412(d)(2)(A) of title 28, United States 
        Code) incurred by the United States in defending the protest.
  ``(h) Decisions and Corrective Actions on Protests.--(1) In making a 
decision on protests filed under this section, the Board concerned 
shall accord due weight to the goals of economic and efficient 
procurement, and shall take due account of the rule of prejudicial 
error.
  ``(2) If the Board concerned determines that a decision of the head 
of the executive agency violates a statute or regulation, the Board 
concerned may order the agency (or its head) to take such corrective 
action as the Board concerned considers appropriate. Corrective action 
includes requiring that the executive agency--
          ``(A) refrain from exercising any of its options under the 
        contract;
          ``(B) recompete the contract immediately;
          ``(C) issue a new solicitation;
          ``(D) terminate the contract;
          ``(E) award a contract consistent with the requirements of 
        such statute and regulation;
          ``(F) implement any combination of requirements under 
        subparagraphs (A), (B), (C), (D), and (E); or
          ``(G) implement such other actions as the Board concerned 
        determines necessary.
  ``(3) If the Board concerned orders corrective action after the 
contract award, the affected contract shall be presumed valid as to all 
goods or services delivered and accepted under the contract before the 
corrective action was ordered.
  ``(4) Any agreement that provides for the dismissal of a protest and 
involves a direct or indirect expenditure of appropriated funds shall 
be submitted to the Board concerned and shall be made a part of the 
public record (subject to any protective order considered appropriate 
by the Board concerned) before dismissal of the protest.
  ``(i) Authority To Declare Entitlement to Costs.--(1)(A) Whenever the 
Board concerned determines that a decision of a contracting officer 
violates a statute or regulation, it may, in accordance with section 
1304 of title 31, United States Code, further declare an appropriate 
prevailing party to be entitled to the costs of--
          ``(i) filing and pursuing the protest, including reasonable 
        attorneys' fees and consultant and expert witness fees, and
          ``(ii) bid and proposal preparation.
  ``(B) No party (other than a small business concern (within the 
meaning of section 3(a) of the Small Business Act)) may be declared 
entitled under this paragraph to costs for--
          ``(i) consultant and expert witness fees that exceed the 
        highest rate of compensation for expert witnesses paid by the 
        Federal Government, or
          ``(ii) attorneys' fees that exceed $150 per hour unless the 
        Board concerned, on a case by case basis, determines that an 
        increase in the cost of living or a special factor, such as the 
        limited availability of qualified attorneys for the proceedings 
        involved, justifies a higher fee.
  ``(2) Payment of amounts due from an agency under paragraph (1) or 
under the terms of a settlement agreement under subsection (h)(4) shall 
be made from the appropriation made by section 1304 of title 31, United 
States Code, for the payment of judgments. The executive agency 
concerned shall reimburse that appropriation account out of funds 
available for the procurement.
  ``(j) Appeals.--A final decision of the Board concerned may be 
appealed as set forth in section 8(g)(1) of the Contract Disputes Act 
of 1978 by the head of the executive agency concerned and by any 
interested party, including interested parties who intervene in any 
protest filed under this section.
  ``(k) Additional Relief.--Nothing contained in this section shall 
affect the power of the Board concerned to order any additional relief 
which it is authorized to provide under any statute or regulation.
  ``(l) Nonexclusivity of Remedies.--Nothing contained in this section 
shall affect the right of any interested party to file a protest with 
the contracting agency or to file an action in the United States Court 
of Federal Claims or in a United States district court.''.

SEC. 425. APPLICABILITY TO CERTAIN CONTRACTS.

  The Office of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), 
as amended by section 424, is further amended by adding at the end the 
following:

``SEC. 215. APPLICABILITY TO CERTAIN CONTRACTS.

  ``(a) Contracts At or Below the Simplified Acquisition Threshold.--
Notwithstanding section 33 of this Act, the authority conferred on the 
Defense Board and the Civilian Board by this title is applicable to 
contracts in amounts not greater than the simplified acquisition 
threshold.
  ``(b) Contracts for Commercial Items.--Notwithstanding section 34 of 
this Act, the authority conferred on the Defense Board and the Civilian 
Board by this title is applicable to contracts for the procurement of 
commercial items.''.
    Subtitle D--Repeal of Other Statutes Authorizing Administrative 
                                Protests

SEC. 431. REPEALS.

  (a) GSBCA Provisions.--Subsection (f) of the Brooks Automatic Data 
Processing Act (section 111 of the Federal Property and Administrative 
Services Act of 1949; 40 U.S.C. 759) is repealed.
  (b) GAO Provisions.--(1) Subchapter V of chapter 35 of title 31, 
United States Code (31 U.S.C. 3551-3556) is repealed.
  (2) The analysis for chapter 35 of such title is amended by striking 
out the items relating to sections 3551 through 3556 and the heading 
for subchapter V.

    Subtitle E--Transfers and Transitional, Savings, and Conforming 
                               Provisions

SEC. 441. TRANSFER AND ALLOCATION OF APPROPRIATIONS AND PERSONNEL.

  (a) Transfers.--
          (1) Armed services board of contract appeals.--The personnel 
        employed in connection with, and the assets, liabilities, 
        contracts, property, records, and unexpended balance of 
        appropriations, authorizations, allocations, and other funds 
        employed, held, used, arising from, available to, or to be made 
        available in connection with the functions vested by law in the 
        Armed Services Board of Contract Appeals established pursuant 
        to section 8 of the Contract Disputes Act of 1978 (41 U.S.C. 
        607) (as in effect on the day before the effective date of this 
        Act), shall be transferred to the Department of Defense Board 
        of Contract Appeals for appropriate allocation by the Chairman 
        of that Board.
          (2) Other boards of contracts appeals.--The personnel 
        employed in connection with, and the assets, liabilities, 
        contracts, property, records, and unexpended balance of 
        appropriations, authorizations, allocations, and other funds 
        employed, held, used, arising from, available to, or to be made 
        available in connection with the functions vested by law in the 
        boards of contract appeals established pursuant to section 8 of 
        the Contract Disputes Act of 1978 (41 U.S.C. 607) other than 
        the Armed Services Board of Contract Appeals (as in effect on 
        the day before the effective date of this Act), shall be 
        transferred to the Civilian Board of Contract Appeals for 
        appropriate allocation by the Chairman of that Board.
          (3) Comptroller general.--(A) One-third (as determined by the 
        Comptroller General) of the personnel employed in connection 
        with, and one-third (as determined by the Comptroller General) 
        of the assets, liabilities, contracts, property, records, and 
        unexpended balance of appropriations, authorizations, 
        allocations, and other funds employed, held, used, arising 
        from, available to, or to be made available in connection with 
        the functions vested by law in the Comptroller General pursuant 
        to subchapter V of chapter 35 of title 31, United States Code 
        (as in effect on the day before the effective date of this 
        Act), shall be transferred to the Civilian Board of Contract 
        Appeals for appropriate allocation by the Chairman of that 
        Board.
          (B) Two-thirds (as determined by the Comptroller General) of 
        the personnel employed in connection with, and two-thirds (as 
        determined by the Comptroller General) of the assets, 
        liabilities, contracts, property, records, and unexpended 
        balance of appropriations, authorizations, allocations, and 
        other funds employed, held, used, arising from, available to, 
        or to be made available in connection with the functions vested 
        by law in the Comptroller General pursuant to subchapter V of 
        chapter 35 of title 31, United States Code (as in effect on the 
        day before the effective date of this Act), shall be 
        transferred to the Department of Defense Board of Contract 
        Appeals for appropriate allocation by the Chairman of that 
        Board.
  (b) Effect on Personnel.--Personnel transferred pursuant to this 
title shall not be separated or reduced in compensation for one year 
after such transfer, except for cause.
  (c) Regulations.--(1) The Department of Defense Board of Contract 
Appeals and the Civilian Board of Contract Appeals shall each prescribe 
regulations for the release of competing employees in a reduction in 
force that gives due effect to--
          (A) efficiency or performance ratings;
          (B) military preference; and
          (C) tenure of employment.
  (2) In prescribing the regulations, the Board concerned shall provide 
for military preference in the same manner as set forth in subchapter I 
of chapter 35 of title 5, United States Code.

SEC. 442. TERMINATIONS AND SAVINGS PROVISIONS.

  (a) Termination of Boards of Contract Appeals.--On the effective date 
of this title, the boards of contract appeals established pursuant to 
section 8 of the Contract Disputes Act of 1978 (41 U.S.C. 607) (as in 
effect on the day before the effective date of this Act) shall 
terminate.
  (b) Savings Provision for Contract Dispute Matters Pending Before 
Boards.--(1) The provisions of this title shall not affect any 
proceedings (other than bid protests pending before the board of 
contract appeals of the General Services Administration) pending on the 
effective date of this Act before any board of contract appeals 
described in subsection (a).
  (2) In the case of any such proceedings pending before the Armed 
Services Board of Contract Appeals, the proceedings shall be continued 
by the Department of Defense Board of Contract Appeals, and orders 
which were issued in any such proceeding by the Armed Services Board of 
Contract Appeals shall continue in effect until modified, terminated, 
superseded, or revoked by the Department of Defense Board of Contract 
Appeals, by a court of competent jurisdiction, or by operation of law.
  (3) In the case of any such proceedings pending before an agency 
board of contract appeals other than the Armed Services Board of 
Contract Appeals, the proceedings shall be continued by the Civilian 
Board of Contract Appeals, and orders which were issued in any such 
proceeding by the agency board shall continue in effect until modified, 
terminated, superseded, or revoked by the Civilian Board of Contract 
Appeals, by a court of competent jurisdiction, or by operation of law.
  (c) Bid Protest Transition Provisions.--(1) No protest may be 
submitted to the Comptroller General pursuant to section 3553(a) of 
title 31, United States Code, or to the board of contract appeals for 
the General Services Administration pursuant to the Brooks Automatic 
Data Processing Act (40 U.S.C. 759) on or after the effective date of 
this Act.
  (2) In the case of bid protest proceedings pending before the board 
of contract appeals of the General Services Administration on the 
effective date of this Act, the proceedings shall be continued by the 
Civilian Board of Contract Appeals. The provisions repealed by section 
431(a) shall continue to apply to such proceedings until the Civilian 
Board of Contract Appeals determines such proceedings have been 
completed.
  (3) The provisions repealed by section 431(b) shall continue to apply 
to proceedings pending on the effective date of this title before the 
Comptroller General pursuant to those provisions, until the Comptroller 
General determines such proceedings have been completed.

SEC. 443. CONTRACT DISPUTES AUTHORITY OF BOARDS.

  (a) Section 2 of the Contract Disputes Act of 1978 (41 U.S.C. 601) is 
amended--
          (1) by amending paragraph (6) to read as follows:
          ``(6) the term `Defense Board' means the Department of 
        Defense Board of Contract Appeals established under section 
        8(a) of this Act;'';
          (2) by redesignating paragraph (7) as paragraph (8); and
          (3) by inserting after paragraph (6) the following new 
        paragraph (7):
          ``(7) the term `Civilian Board' means the Civilian Board of 
        Contract Appeals established under section 8(b) of this Act; 
        and''.
  (b) Section 6(c)(6) of the Contract Disputes Act of 1978 (41 U.S.C. 
605(c)(6)) is amended--
          (1) by striking out ``court or an agency board of contract 
        appeals'' and inserting in lieu thereof ``court, the Defense 
        Board, or the Civilian Board'';
          (2) by striking out ``an agency board of contract appeals'' 
        in the third sentence and inserting in lieu thereof ``the 
        Defense Board or the Civilian Board''; and
          (3) by striking out ``agency board'' and inserting in lieu 
        thereof ``the Board concerned''.
  (c) Section 7 of the Contract Disputes Act of 1978 (41 U.S.C. 606) is 
amended by striking out ``an agency board of contract appeals'' and 
inserting in lieu thereof ``the Defense Board or the Civilian Board''.
  (d) Section 8 of the Contract Disputes Act of 1978 (41 U.S.C. 607), 
as amended by section 411, is further amended--
          (1) by amending the heading to read as follows:
          ``defense and civilian boards of contract appeals'';
          (2) by striking out subsection (c);
          (3) in subsection (d)--
                  (A) by striking out the first sentence and inserting 
                in lieu thereof the following:
``The Defense Board shall have jurisdiction to decide any appeal from a 
decision of a contracting officer of the Department of Defense, the 
Department of the Army, the Department of the Navy, or the Department 
of the Air Force relative to a contract made by that department. The 
Civilian Board shall have jurisdiction to decide any appeal from a 
decision of a contracting officer of any executive agency (other than 
the Department of Defense or the Department of the Army, the Navy, or 
the Air Force) relative to a contract made by that agency.''; and
                  (B) in the second sentence, by striking out ``the 
                agency board'' and inserting in lieu thereof ``the 
                Board concerned'';
          (4) in subsection (e), by striking out ``An agency board 
        shall provide'' and inserting in lieu thereof ``The Defense 
        Board and the Civilian Board shall each provide,'';
          (5) in subsection (f), by striking out ``each agency board'' 
        and inserting in lieu thereof ``the Defense Board and the 
        Civilian Board'';
          (6) in subsection (g)--
                  (A) in the first sentence of paragraph (1), by 
                striking out ``an agency board of contract appeals'' 
                and inserting in lieu thereof ``the Defense Board or 
                the Civilian Board, as the case may be,'';
                  (B) by striking out paragraph (2); and
                  (C) by redesignating paragraph (3) as paragraph (2); 
                and
          (7) by striking out subsections (h) and (i).
  (e) Section 9 of the Contract Disputes Act of 1978 (41 U.S.C. 608) is 
amended--
          (1) in subsection (a), by striking out ``each agency board'' 
        and inserting in lieu thereof ``the Defense Board and the 
        Civilian Board''; and
          (2) in subsection (b), by striking out ``the agency board'' 
        and inserting in lieu thereof ``the Board concerned''.
  (f) Section 10 of the Contract Disputes Act of 1978 (41 U.S.C. 609) 
is amended--
          (1) in subsection (a)--
                  (A) in the first sentence of paragraph (1)--
                          (i) by striking out ``Except as provided in 
                        paragraph (2), and in'' and inserting in lieu 
                        thereof ``In''; and
                          (ii) by striking out ``an agency board'' and 
                        inserting in lieu thereof ``the Defense Board 
                        or the Civilian Board'';
                  (B) by striking out paragraph (2); and
                  (C) by redesignating paragraph (3) as paragraph (2), 
                and in that paragraph by striking out ``or (2)'';
          (2) in subsection (b)--
                  (A) by striking out ``any agency board'' and 
                inserting in lieu thereof ``the Defense Board or the 
                Civilian Board''; and
                  (B) by striking out ``the agency board'' and 
                inserting in lieu thereof ``the Board concerned'';
          (3) in subsection (c)--
                  (A) by striking out ``an agency board'' and inserting 
                in lieu of each ``the Defense Board or the Civilian 
                Board''; and
                  (B) by striking out ``the agency board'' and 
                inserting in lieu thereof ``the Board concerned''; and
          (4) in subsection (d)--
                  (A) by striking out ``one or more agency boards'' and 
                inserting in lieu thereof ``the Defense Board or the 
                Civilian Board (or both)''; and
                  (B) by striking out ``or among the agency boards 
                involved'' and inserting in lieu thereof ``one or both 
                of the Boards''.
  (g) Section 11 of the Contract Disputes Act of 1978 (41 U.S.C. 610) 
is amended--
          (1) in the first sentence, by striking out ``an agency board 
        of contract appeals'' and inserting in lieu thereof ``the 
        Defense Board or the Civilian Board''; and
          (2) in the second sentence, by striking out ``the agency 
        board through the Attorney General; or upon application by the 
        board of contract appeals of the Tennessee Valley Authority'' 
        and inserting in lieu thereof ``the Defense Board or the 
        Civilian Board''.
  (h) Section 13 of the Contract Disputes Act of 1978 (41 U.S.C. 612) 
is amended--
          (1) in subsection (b), by striking out ``an agency board of 
        contract appeals'' and inserting in lieu thereof ``the Defense 
        Board or the Civilian Board''; and
          (2) in subsection (d)(2), by striking out ``by the board of 
        contract appeals for'' and inserting in lieu thereof ``by the 
        Defense Board or the Civilian Board from''.

SEC. 444. REFERENCES TO AGENCY BOARDS OF CONTRACT APPEALS.

  (a) Defense Board.--Any reference to the Armed Services Board of 
Contract Appeals in any provision of law or in any rule, regulation, or 
other paper of the United States shall be treated as referring to the 
Department of Defense Board of Contract Appeals.
  (b) Civilian Board.--Any reference to an agency board of contract 
appeals other than the Armed Services Board of Contract Appeals in any 
provision of law or in any rule, regulation, or other paper of the 
United States shall be treated as referring to the Civilian Board of 
Contract Appeals.

SEC. 445. CONFORMING AMENDMENTS.

  (a) Title 5.--Section 5372a of title 5, United States Code, is 
amended--
          (1) in subsection (a)(1), by striking out ``an agency board 
        of contract appeals appointed under section 8 of the Contract 
        Disputes Act of 1978'' and inserting in lieu thereof ``the 
        Department of Defense Board of Contract Appeals or the Civilian 
        Board of Contract Appeals appointed under section 202 of the 
        Office of Federal Procurement Policy Act''; and
          (2) in subsection (a)(2), by striking out ``an agency board 
        of contract appeals'' and inserting in lieu thereof ``the 
        Department of Defense Board of Contract Appeals or the Civilian 
        Board of Contract Appeals''.
  (b) Title 10.--(1) Section 2305(e) of title 10, United States Code, 
is amended--
          (A) in paragraph (1), by striking out ``subchapter V of 
        chapter 35 of title 31'' and inserting in lieu thereof ``title 
        II of the Office of Federal Procurement Policy Act''; and
          (B) by striking out paragraph (3).
  (2) Section 2305(f) of such title is amended--
          (A) in paragraph (1), by striking out ``subparagraphs (A) 
        through (F) of subsection (b)(1) of section 3554 of title 31'' 
        and inserting in lieu thereof ``section 214(h)(2) of the Office 
        of Federal Procurement Policy Act''; and
          (B) in paragraph (2), by striking out ``paragraph (1) of 
        section 3554(c) of title 31 within the limits referred to in 
        paragraph (2)'' and inserting in lieu thereof ``subparagraph 
        (A) of section 214(i)(1) of the Office of Federal Procurement 
        Policy Act within the limits referred to in subparagraph (B)''.
  (c) Federal Property and Administrative Services Act of 1949.--(1) 
Section 303B(j) (as redesignated by section 104(b)(2)) of the Federal 
Property and Administrative Services Act of 1949 (41 U.S.C. 253b(h)) is 
amended--
          (A) in paragraph (1), by striking out ``subchapter V of 
        chapter 35 of title 31, United States Code'' and inserting in 
        lieu thereof ``title II of the Office of Federal Procurement 
        Policy Act''; and
          (B) by striking out paragraph (3).
  (2) Section 303B(k) (as redesignated by section 104(b)(2)) of such 
Act (41 U.S.C. 253b(i)) is amended--
          (A) in paragraph (1), by striking out ``in subparagraphs (A) 
        through (F) of subsection (b)(1) of section 3554 of title 31, 
        United States Code'' and inserting in lieu thereof ``section 
        214(h)(2) of the Office of Federal Procurement Policy Act''; 
        and
          (B) in paragraph (2), by striking out ``paragraph (1) of 
        section 3554(c) of such title within the limits referred to in 
        paragraph (2)'' and inserting in lieu thereof ``subparagraph 
        (A) of section 214(i)(1) of the Office of Federal Procurement 
        Policy Act within the limits referred to in subparagraph (B)''.
  (d) Office of Federal Procurement Policy Act.--The table of contents 
for the Office of Federal Procurement Policy Act (contained in section 
1(b)) is amended--
          (1) by inserting the following before the item relating to 
        section 1:

         ``TITLE I--FEDERAL PROCUREMENT POLICY GENERALLY''; and
          (2) by adding at the end the following:

                     ``TITLE II--DISPUTE RESOLUTION

                    ``Subtitle A--General Provisions

``Sec. 201. Definitions.
``Sec. 202. Membership.
``Sec. 203. Chairman.
``Sec. 204. Rulemaking authority.
``Sec. 205. Authorization of appropriations.

``Subtitle B--Functions of the Defense and Civilian Boards of Contract 
                                Appeals

``Sec. 211. Alternative dispute resolution services.
``Sec. 212. Alternative dispute resolution of disputes and protests 
submitted to Boards.
``Sec. 213. Contract disputes.
``Sec. 214. Protests.
``Sec. 215. Applicability to certain contracts.''.
       Subtitle F--Effective Date; Interim Appointment and Rules

SEC. 451. EFFECTIVE DATE.

  This title and the amendments made by this title shall take effect on 
October 1, 1996.

SEC. 452. INTERIM APPOINTMENT.

  (a) Defense Board.--The judge serving as chairman of the Armed 
Services Board of Contract Appeals on the date of the enactment of this 
Act shall serve as Chairman of the Department of Defense Board of 
Contract Appeals during the two-year period beginning on the effective 
date of this title, unless such individual resigns such position or the 
position otherwise becomes vacant before the expiration of such period. 
The authority vested in the Secretary of Defense by section 203(a) of 
the Office of Federal Procurement Policy Act (as added by section 413) 
shall take effect upon the expiration of such two-year period or on the 
date such position is vacated, whichever occurs earlier.
  (b) Civilian Board.--The judge serving as chairman of the board of 
contract appeals of the General Services Administration on the date of 
the enactment of this Act shall serve as Chairman of the Civilian Board 
of Contract Appeals during the two-year period beginning on the 
effective date of this title, unless such individual resigns such 
position or the position otherwise becomes vacant before the expiration 
of such period. The authority vested in the Administrator of General 
Services by section 203(a) of the Office of Federal Procurement Policy 
Act (as added by section 413) shall take effect upon the expiration of 
such two-year period or on the date such position is vacated, whichever 
occurs earlier.

SEC. 453. INTERIM RULES.

  (a) Rules of Procedure.--Until such date as rules of procedure are 
promulgated pursuant to section 204 of the Office of Federal 
Procurement Policy Act (as added by section 414)--
          (1) for protests, the rules of procedure of the board of 
        contract appeals of the General Services Administration, as in 
        effect on the day before the effective date of this Act, shall 
        be the rules of procedure for both the Department of Defense 
        Board of Contract Appeals and the Civilian Board of Contract 
        Appeals; and
          (2) for contract disputes--
                  (A) the rules of procedure of the board of contract 
                appeals of the General Services Administration, as in 
                effect on the day before the effective date of this 
                Act, shall be the rules of procedure for the Civilian 
                Board of Contract Appeals; and
                  (B) the rules of procedure of the Armed Services 
                Board of Contract Appeals, as in effect on the day 
                before the effective date of this Act, shall be the 
                rules of procedure for the Department of Defense Board 
                of Contract Appeals.
  (b) Rules Regarding Board Judges.--(1) Until such date as the 
Department of Defense Board of Contract Appeals (in this paragraph 
referred to as the ``Defense Board'') promulgates rules governing the 
establishment and maintenance of a register of eligible applicants and 
the selection of Board judges, the rules of the Armed Services Board of 
Contract Appeals governing the establishment and maintenance of a 
register of eligible applicants and the selection of board members (as 
in effect on the day before the effective date of this Act) shall be 
the rules of the Defense Board governing the establishment and 
maintenance of a register of eligible applicants and the selection of 
Board judges, except that any provisions of the rules of the Armed 
Services Board of Contract Appeals that authorize any individual other 
than the chairman of such board to select a Defense Board judge shall 
have no effect.
  (2) Until such date as the Civilian Board of Contract Appeals (in 
this paragraph referred to as the ``Civilian Board'') promulgates rules 
governing the establishment and maintenance of a register of eligible 
applicants and the selection of Board judges, the rules of the board of 
contract appeals of the General Services Administration governing the 
establishment and maintenance of a register of eligible applicants and 
the selection of board members (as in effect on the day before the 
effective date of this Act) shall be the rules of the Civilian Board 
governing the establishment and maintenance of a register of eligible 
applicants and the selection of Board judges, except that any 
provisions of the rules of the board of contract appeals of the General 
Services Administration that authorize any individual other than the 
chairman of such board to select a Civilian Board judge shall have no 
effect.
              TITLE V--EFFECTIVE DATES AND IMPLEMENTATION

SEC. 501. EFFECTIVE DATE AND APPLICABILITY.

  (a) Effective Date.--Except as otherwise provided in this title, this 
title and the amendments made by this title shall take effect on the 
date of the enactment of this Act.
  (b) Applicability of Amendments.--(1) An amendment made by this title 
shall apply, in the manner prescribed in the final regulations 
promulgated pursuant to section 502 to implement such amendment, with 
respect to any solicitation that is issued, any unsolicited proposal 
that is received, and any contract entered into pursuant to such a 
solicitation or proposal, on or after the date described in paragraph 
(3).
  (2) An amendment made by this title shall also apply, to the extent 
and in the manner prescribed in the final regulations promulgated 
pursuant to section 502 to implement such amendment, with respect to 
any matter related to--
          (A) a contract that is in effect on the date described in 
        paragraph (3);
          (B) an offer under consideration on the date described in 
        paragraph (3); or
          (C) any other proceeding or action that is ongoing on the 
        date described in paragraph (3).
  (3) The date referred to in paragraphs (1) and (2) is the date 
specified in such final regulations. The date so specified shall be 
October 1, 1996, or any earlier date that is not within 30 days after 
the date on which such final regulations are published.

SEC. 502. IMPLEMENTING REGULATIONS.

  (a) Proposed Revisions.--Proposed revisions to the Federal 
Acquisition Regulation and such other proposed regulations (or 
revisions to existing regulations) as may be necessary to implement 
this title shall be published in the Federal Register not later than 
210 days after the date of the enactment of this Act.
  (b) Public Comment.--The proposed regulations described in subsection 
(a) shall be made available for public comment for a period of not less 
than 60 days.
  (c) Final Regulations.--Final regulations shall be published in the 
Federal Register not later than 330 days after the date of enactment of 
this Act.
  (d) Modifications.--Final regulations promulgated pursuant to this 
section to implement an amendment made by this title may provide for 
modification of an existing contract without consideration upon the 
request of the contractor.
  (e) Savings Provisions.--(1) Nothing in this title shall be construed 
to affect the validity of any action taken or any contract entered into 
before the date specified in the regulations pursuant to section 
501(b)(3) except to the extent and in the manner prescribed in such 
regulations.
  (2) Except as specifically provided in this title, nothing in this 
title shall be construed to require the renegotiation or modification 
of contracts in existence on the date of the enactment of this Act.
  (3) Except as otherwise provided in this title, a law amended by this 
title shall continue to be applied according to the provisions thereof 
as such law was in effect on the day before the date of the enactment 
of this Act until--
          (A) the date specified in final regulations implementing the 
        amendment of that law (as promulgated pursuant to this 
        section); or
          (B) if no such date is specified in regulations, October 1, 
        1996.
                      Short Summary of Legislation

                                Title I

    H.R. 1670 at title I amends Federal procurement law to 
establish a new standard of full and open competition for the 
government's purchase of goods and services. The standard 
requires that the government provide ``open access'' to its 
market for all firms through the use of competitive procedures, 
while permitting the government to focus the competition it 
receives on the need to efficiently fulfill its requirements. 
This creates a balanced system which permits all firms to 
submit offers to meet government requirements. At the same 
time, the government is allowed to establish its requirements 
and specifications based solely on its minimum needs and to 
efficiently select the most advantageous offer from those 
submitted based upon clearly stated evaluation factors.
    The change from current law will decrease costs for both 
government and industry by permitting the efficient and timely 
removal from the competition of firms that are not qualified or 
whose products are not reasonably priced. While all firms would 
be permitted to bid, the new standard allows the government's 
procurement professionals to focus their attention on all 
qualified offerors who can meet the government's requirements 
at a reasonable cost.
    Title I makes a number of other changes to accommodate the 
new competition standard and to streamline and modernize the 
procurement statutes.

                                Title II

    Title II of the legislation strengthens the improvements in 
the acquisition of commercial items made by the Federal 
Acquisition Streamlining Act of 1994 (FASA). FASA provided the 
foundation for establishing ``commercial-like'' procedures 
within the Federal procurement system. H.R. 1670 builds upon 
what FASA created by establishing simplified procedures for the 
purchase of commercial items and exempting commercial item 
purchases from burdensome government-unique requirements such 
as the Truth in Negotiations Act and Cost Accounting Standards.

                               Title III

    H.R. 1670 at title III repeals current provisions of law 
known as ``Procurement Integrity'' and replaces those 
provisions with simple prohibitions and clearer administrative 
standards. The provisions more squarely address the same basic 
concern as current law--the unauthorized disclosure and receipt 
of procurement-sensitive information--but does it by focusing 
on the information to be protected. While the remedies are 
similar to those under current law, H.R. 1670 repeals the 
complex system of certifications and eliminates the remaining 
agency-specific post-employment restrictions which were made 
unnecessary when Congress passed the Ethics Reform Act of 1989.
    Title III also repeals a current provision of law which 
requires the payment of a fee or tax to the U.S. government on 
foreign sales of products or technologies developed under 
government contracts. The repeal is contingent on the President 
and Congress providing budget offsets for any receipts lost as 
a result of the repeal.
    Further, title III adds a new provision setting forth in 
statute for the first time a policy that, since 1955, has been 
the underpinning of the government's acquisition system: that 
the government is to rely on the private sector to supply its 
needs.
    Title III also eliminates certain non-value added 
certifications while retaining the underlying prohibitions. In 
addition, title III requires elimination of all 
administratively-imposed certifications unless they can be 
justified as necessary.
    Also, title III adopts a Department of Defense proposal to 
amend FASA to add the Joint Standoff Weapon Unitary Variant 
(JSOW-UV) as a defense acquisition pilot program to the current 
five pilot programs in FASA.
    Finally, title III further streamlines and simplifies the 
procurement process by repealing certain duplicative or 
unneeded provisions of law, including a provision that would 
inhibit the authority of the executive branch from testing 
innovative procurement procedures.

                                Title IV

    Title IV of the bill consolidates the current two bid 
protest forums and the 11 administrative tribunals located 
within different government agencies for the resolution of 
government contract disputes into two boards--one at the 
Department of Defense (DoD) to handle DoD bid protests and 
contract disputes and one at the General Services 
Administration to handle civilian agency bid protests and 
contract disputes. A single set of new procedures and processes 
will govern both boards.

                 I. Background and Need for Legislation

    Each year the government spends about $200 billion on goods 
and services, ranging from weapons systems to computer systems 
to everyday commodities. The current system costs too much, 
involves too much red tape, and ill-serves the taxpayer and 
industry.
    In December 1994, a report prepared for the Secretary of 
Defense found that, on average, the government pays an 
additional 18 percent on what it buys solely because of 
requirements it imposes on its contractors. That confirmed the 
average estimate by major contractors surveyed by the General 
Accounting Office that the additional costs incurred in selling 
to the government are about 19 percent. While some of the 
government's unique requirements certainly are needed, we 
clearly are paying an enormous premium for them--billions of 
dollars annually.
    And that is only part of the government's inflated cost of 
doing business--for it includes only what is paid to 
contractors, not the cost of the government's own 
administrative system. The government's contracting officials 
are confronted with a daunting array of mandates of their own, 
often amounting to step-by-step prescriptions that increase 
staff and equipment needs. This rigid, rule-based process 
leaves little room for the exercise of business judgement, 
initiative, and creativity and often forces the professional 
staff to assume the role of box-checking robots.
    These requirements are well-intentioned. From the time the 
Second Continental Congress established a Commissary General in 
1775, the procurement system commanded the attention of both 
public officials and the American public. Unfortunately and all 
too often, the attention has focused on individual abuses 
rather than the operations of the system as a whole. In 
response, Congress and the executive branch have maintained a 
constant effort to correct wrongs or add particular 
initiatives. Inevitably, after a while, often-uncoordinated 
incremental efforts will tilt any system out of balance, until 
the cost of requirements outweigh benefits. That is the current 
state of our procurement system. It has become an unbalanced 
mass of requirements that lead, simply, to too much money for 
too little product. Mr. Philip K. Howard in a recent editorial 
on the government's procurement process in the Wall Street 
Journal aptly described the state of the current process as 
follows:

          The rigid procedures designed to prevent squandering 
        of public money, as it turns out, function almost 
        perfectly to guarantee that the money gets squandered.

    It is critical in these times of declining budgets to bring 
the government's procurement system into balance.
            II. Legislative History/Committee Consideration

    Last year, a significant step was taken toward establishing 
a more commercial-like Federal contracting system. Congress 
took that step with the passage of the Federal Acquisition 
Streamlining Act of 1994 (FASA) (Public Law 103-355). FASA 
established a preference for commercial items and simplified 
procedures for contracts under $100,000, as well as addressing 
a wide spectrum of issues regarding the administrative burden--
on all sides--associated with the government's specialized 
requirements. These ranged from socio-economic laws to the 
government's oversight tools, which over the years have 
resulted in major differences between the government and 
commercial marketplaces.
    But FASA went only part of the way, and as important as 
that effort was, more must be done to move the Federal 
procurement system closer to a commercial-type process. It is 
imperative that industry sellers and government buyers are 
allowed to offer and acquire, respectively, maximum value for 
the taxpayer.
    On February 24, 1995, Chairman William F. Clinger, Jr. of 
the Committee on Government Reform and Oversight and Chairman 
Floyd D. Spence of the Committee on National Security and 
Chairman Benjamin A. Gilman of the Committee on International 
Relations introduced H.R. 1038 to revise and streamline the 
acquisition laws of the Federal Government. The bill addressed 
two issues: repeal of the recoupment of research and 
development costs and a rewrite of the Procurement Integrity 
law.
    The bill was referred to the Subcommittee on Government 
Management, Information and Technology, which met pursuant to 
notice on February 28, 1995 to solicit proposals for further 
simplifying and streamlining the Federal procurement process.
    At the hearing, testimony was received from various 
procurement specialists in the contracting community including: 
the Honorable Steven Kelman, Administrator for Federal 
Procurement Policy, Office of Management and Budget; Mrs. 
Colleen Preston, Deputy Under Secretary for Acquisition Reform, 
Department of Defense; Mr. Robert P. Murphy, General Counsel, 
General Accounting Office; Mr. Ron Turner, Computing Devices, 
Inc. for the Acquisition Reform Working Group (ARWG); Mr. John 
C. Custer, Mason & Hangar, Mason-Silas, Inc. for ARWG; Mr. Paul 
Schwiezer, Schwiezer Aircraft Corporation; Mr. Carl Guerreri, 
Electronic Warfare Associates, for ARWG; Mr. Bernard F. McKay, 
AT&T;, for the Computer and Communications Information 
Association; Mr. Randall I. Cole, HFSI, for the Information 
Technology Association of America; Mr. Bruce E. Leinster, IBM 
Corporation, for the Information Technology Industry Council; 
Mr. Dennis Cossey, Innotek Corporation; Mr. Robert F. Trimble, 
Procurement Round Table; Mr. John B. Miller, Gadsby & Hannah, 
for the Section of Public Contract Law, American Bar 
Association; Mr. William J. Mielke, Ruekert Mielke Consultants, 
for the Council on Federal Procurement of Architectural/
Engineering Services.
    Generally, the comments of the witnesses were as follows: 
those representing the government expressed the need for less 
congressional micro-management and greater flexibility and 
authority for agency contracting officers; those representing 
businesses, both large and small, reiterated their long held 
views about reducing government rules and regulations so they 
could sell to government agencies like they do to private 
sector buyers; and those representing other groups complained 
that existing laws are too complicated and too confusing.
    The various proposals for reform which were brought forward 
by the witnesses ranged from minor technical corrections to a 
complete overhaul of the system. This wealth of ideas 
contributed to the effort which resulted in the introduction of 
H.R. 1670 on May 18, 1995, by Chairman Clinger for himself, Mr. 
Spence, Mr. Horn, Mr. Zeliff, Mr. Blute, Mr. Davis, Mr. 
Scarborough, Mr. Lewis of Kentucky, Mr. Tate, Mr. Tiahrt, Mr. 
Flanagan, Mr. Bass, Mr. Chambliss, Mr. Fox, Mr. Watts, Mr. 
Moran, and Mr. McKeon.
    A joint hearing by the Government Reform and Oversight and 
National Security Committees was then held on May 25, 1995 to 
solicit views on the bill as introduced on May 18, 1995. 
Chairman Clinger noted at the beginning of the hearing that, 
``some may say we should rest on our laurels, and let the 
system absorb the changes made last year by the Federal 
Acquisition Streamlining Act. But clearly the system still 
cries out for fundamental change * * * . From the time the 
Second Continental Congress established a Commissary General in 
1775, the Federal procurement system has commanded the 
attention of both public officials and the American taxpayer. 
In many respects, we still are guided today by the same 
considerations the Commissary General faced in 1775: how to 
provide meaningful competition, obtain quality goods at 
reasonable prices, and ensure accountability of public 
officials for public transactions. And too, as in 1775, we are 
under great budgetary constraints that drive us to look at ways 
to meet our goals, yet do so in a way that is affordable and 
uses common sense.''
    Procurement experts from government and industry provided 
comment. Those witnesses included: Mr. James Leto, Chairman and 
Chief Executive Officer, PRC, Inc. for the Acquisition Reform 
Working Group (ARWG); Mr. Stanley Ebner, Vice President, 
Washington Operations, McDonnell Douglas, for ARWG; Mr. Milton 
Cooper, President, Systems Group, Computer Sciences 
Corporation, for the Information Technology Association of 
America; Mr. Edward Cypert, Vice President, Operations, Space & 
Electronics Group, TRW, Inc., for ARWG; Mr. Edward Black, 
President, Computer and Communications Information Association; 
Mr. Dan Young, President, Federal Data Corporation; Mr. 
Sterling Phillips, Executive Vice President & Chief Operating 
Officer, Tri-Cor Industries, Inc.; Ms. Elizabeth Salih, 
Contracting Officer, General Services Administration, Fort 
Worth, TX; Colonel John M. Case (USAF), Program Director, 
Maxwell Air Force Base, Montgomery, AL; the Honorable Steven 
Kelman, Administrator for Federal Procurement Policy, Office of 
Management and Budget; Captain Barry Cohen (USN), Deputy to the 
Deputy Under Secretary for Acquisition Reform, Department of 
Defense; Mr. John Miller, Gadsby & Hannah, for the Section of 
Public Contract Law, American Bar Association; Mr. Stephen 
Daniels, Chairman, General Services Board of Contract Appeals, 
General Services Administration; Mr. Robert Murphy, General 
Counsel, General Accounting Office, accompanied by Mr. Frank 
Conahan, Senior Defense and International Affairs Advisor to 
the Comptroller General.
    Statements presented by representatives of ARWG emphasized 
that H.R. 1670 has the potential to shift presumptions of 
private and public-sector business interactions from negative 
ones to positive ones, and carries with it the potential to do 
things cheaper, faster and better than currently is done today. 
These representatives identified H.R. 1670 as clearly making a 
long-term mark on the acquisition system to prepare it for the 
21st century.
    A representative of the Computer and Communications 
Industry Association, Mr. Edward Black, strongly recommended 
that any new reforms only be considered after careful 
evaluation of reforms passed last Congress under the FASA. Mr. 
Dan Young of Federal Data Corporation, a small business, stated 
that he believed the bill's new standard of competition would 
not deter his company's participation in future government 
procurements. And finally, Mr. Sterling Phillips, Chief 
Executive Operating Officer, Tri-Cor Industries, a small 
minority-owned firm that predominantly participates in the 
Federal marketplace shared the Committee's sense of urgency to 
streamline the cumbersome and costly acquisition process, 
noting that this is an issue every bit as important to industry 
as it is to government.
    As a representative of the Administration, Ms. Elizabeth 
Salih, a government contracting officer with the General 
Services Administration in Fort Worth, Texas, stated that the 
current statutory and regulatory framework leaves no room to 
exercise the training and knowledge she has gained, and that by 
the time she adheres to all the requirements, ``the taxpayer 
has paid a tremendous price for this unnecessary oversight.'' 
She went on to ask for the Committee's help in removing the 
obstacles that hinder her so she ``can make a difference in the 
way the public views the government and its lawmakers in terms 
of expenditure of funds.''
    Other witnesses who represented the American Bar 
Association and General Services Board of Contract Appeals 
raised concerns about the current forums for bid protests and 
made suggestions for change to streamline current government 
procedures.
    Subsequent to the hearing, Chairman Clinger, Chairman 
Spence and other members of their committees held several 
meetings with interested parties from the government 
contracting community. As a result, an amendment in the nature 
of a substitute to H.R. 1670 was developed to reflect the views 
of other members of Congress (both Republican and Democrat), 
industry associations, senior industry executives, the 
Administration, government contracting officials, 
representatives of both large and small business, and from 
other interested individuals.
    The Committee on Government Reform and Oversight met on 
July 27, 1995, to consider H.R. 1670. Chairman Clinger 
presented the amendment in the nature of a substitute, 
reflecting the revisions made subsequent to the hearing. The 
bill, as amended, was favorably reported to the House by voice 
vote and without further amendment by the full Committee.

                      III. Explanation of the Bill

                              a. overview

Title I

    Competition is the driving force of our free enterprise 
system, and consequently must remain the driver behind the 
Committee's efforts to reform the current Federal procurement 
system. H.R. 1670 creates an open system which permits all 
firms to submit offers to meet government requirements. At the 
same time, the government is allowed to establish its 
requirements and specifications based solely on its minimum 
needs and to efficiently select the most advantageous offer 
from those submitted based upon clearly stated evaluation 
factors. This provides the necessary balance to a procurement 
system that has become overly burdened with step-by-step 
prescriptions leaving little room for the exercise of 
judgement, initiative, and creativity. However, the increased 
discretion given to contracting officials is to be accompanied 
by a robust and easily-accessed protest process established in 
title IV of H.R. 1670 to ensure that a contracting official's 
decision that results in the elimination of a firm from the 
competition at any point in the process has a rational basis.
    The provisions of law which currently comprise the 
competition requirements have proven to be overly complex and 
cumbersome. H.R. 1670 attempts to streamline these provisions 
to provide clear statutory standards and policy guidance, but 
to remove from statute the congressional micro-management 
complained about by both industry and the executive agencies. 
For example, H.R. 1670 (in section 101) eliminates from statute 
the long list of circumstances under which an agency may 
exclude a particular firm in order to maintain an alternate 
source and places the requirement for setting forth those 
circumstances in the Federal Acquisition Regulation (FAR). The 
Committee expects that the regulation writers will include in 
the FAR the current statutory reasons for exercising this 
authority listed as subparagraphs (A) through (F) under 10 
U.S.C. 2304(b)(1) and 41 U.S.C. 253(b)(1). There is no intent 
on the part of the Committee to change these existing 
exceptions.
    The Committee intends that the provisions in title I 
authorize the use of innovative procedures involving the 
issuance of solicitations containing multi-phase, quality-based 
evaluation processes. These procedures could include the use of 
preliminary selection factors based primarily upon the 
qualifications that an offeror must have in order to meet the 
government's requirements. Those firms successfully meeting the 
government's stated qualification requirements would then 
submit detailed price and technical proposals. The final 
selection of the most advantageous offer would be made from 
among those firms in accordance with evaluation factors set 
forth in the solicitation.
    Further, through changes made in this title and also in 
title III (Procurement Integrity), the Committee hopes to 
encourage more open communication between government and 
industry in the early stages of program requirements 
development. It is important that industry have early access to 
government spending information in order to make decisions on 
how to spend valuable research and development and bid and 
proposal funds. The Committee believes that the availability of 
such information, if not in conflict with the Office of 
Management and Budget (OMB) Circular A-10 (which restricts 
release of detailed budget information related to the 
President's planned budget), would be appropriate in order to 
increase the quality and timeliness of contractor bids and 
result in the overall streamlining of the procurement process.
    Another streamlining effort of H.R. 1670 is to eliminate 
the current pre-qualification process and replace it with one 
which is simpler and provides clear statutory standards on 
which the executive agency bases its pre-qualification (or 
``verification''). It is intended to be a system open to all 
firms and once in the system, these firms would compete with 
each other in procurements conducted within the system. In 
order to be considered ``verified,'' firms would be assessed 
based upon various criteria, among them ``past performance.'' 
H.R. 1670 provides that past performance includes a firm's 
performance under contracts with state and local governments 
and with private sector entities as well as those with the 
Federal government. This list of elements of past performance 
is not intended to be exclusive. For example, the Committee 
believes that it would be appropriate to consider a firm's 
performance under contracts with foreign entities.

Title II

    FASA set an important precedent when it established a 
preference for the acquisition of commercial items and provided 
for an expanded exemption for such items from the requirement 
for certified cost or pricing data contained in the Truth in 
Negotiations Act (TINA). To complete the initiative began in 
FASA, the bill exempts all commercial items, as defined by the 
Office of Federal Procurement Policy (OFPP) Act at 41 U.S.C. 
403, from the certified data and audit requirements of TINA and 
from the corresponding requirements of the Cost Accounting 
Standards. The impact of the commercial market on the price of 
the item should be sufficient.
    Further, the expanded use of simplified procedures also was 
conceived in FASA by increasing the threshold for simplified 
purchases. H.R. 1670 takes the next step and provides for the 
use of simplified procedures when purchasing a commercial item. 
The purchase of a commercial item logically lends itself to 
simplified procedures because there exists a yardstick in the 
commercial marketplace against which to measure price and 
product quality and to serve as a surrogate for government-
unique procedures. While the Committee is aware that some have 
expressed a concern that there is no dollar threshold, the 
Committee believes that any dollar threshold would be 
inconsistent with the commercial-type process established by 
H.R. 1670. Since there is no requirement in H.R. 1670 that 
simplified procedures be used, procurement officials would have 
the discretion to use standard procedures where the 
circumstances dictated. Circumstances such as the complexity of 
the purchase, past experience with the particular item, whether 
it is a commonplace item, and the availability of the item 
should be taken into account when determining which procedures 
to use for the purchase of a particular commercial item. It is 
not the Committee's intent that simplified procedures be used 
for every purchase of commercial items.
Title III

    Title III sets forth for the first time in statute the 
policy which has been the underpinning of the government's 
acquisition system since 1955: that the government rely on the 
private sector for its needed goods and services. While this 
policy statement currently is included in OMB Circular A-76, a 
statutory statement expresses Congress' commitment to the 
policy. Other issues surrounding OMB Circular A-76 are not 
addressed in H.R. 1670. However, the Committee believes that 
industry and the executive branch could make a valuable 
contribution to improving the acquisition system if together 
they study issues such as the cost comparison process as it now 
exists and make recommendations as to how the process can be 
streamlined and made less costly and more effective.
    Also, title III eliminates certain statutory certification 
requirements, requires the removal of current regulatory 
certifications unless retention is supported by a written 
justification, and prohibits new regulatory certification 
requirements unless mandated by statute or justified in 
writing. Most certifications are established merely to certify 
performance or compliance already required by contract clauses 
or provisions of law or regulation. By signing a proposal or 
contract, contractors accept responsibility for performance of 
all the terms of the contract and all applicable law. 
Certifications do not result in improved compliance with the 
law or even improved ethical behavior. However, certifications 
do increase the administrative costs of both the government and 
industry and deter participation in the government market. The 
provision would retain the underlying prohibitions but 
eliminate what, in many cases, are non-value added 
certification requirements which often do more to deter 
participation in the government market rather than the 
prohibited conduct. Further, although the provisions refer to 
agency procurement regulations, the Committee intends this to 
mean procurement regulations at all levels within an agency.
    Title III repeals a current provision of law which 
disadvantages U.S. companies when selling American products in 
international markets. The repeal would be contingent on the 
President and the Congress providing budget offsets for any 
receipts to the government lost as a result of the repeal. 
Current law requires that a fee or tax be paid to the U.S. 
government on foreign sales of products and technologies 
developed under government contracts. It may have been an 
appropriate policy when it was originally adopted in the early 
1960's as a way of sharing development costs with U.S. allies. 
But today, our allies are our competition, and this policy 
threatens the future of American workers by making it more 
difficult for their employers to compete for business in the 
world marketplace. The Bush Administration recommended repeal 
of this provision, and the Clinton Administration currently is 
recommending its repeal.
    Title III repeals current provisions of law known as 
``Procurement Integrity'' and replaces these provisions with 
simple prohibitions and clearer administrative standards. This 
proposal was developed originally by the Bush Administration 
and is supported by the Clinton Administration. The provisions 
more squarely address the same basic concern as current law--
the unauthorized disclosure and receipt of procurement-
sensitive information--but do it by focusing on the information 
to be protected. With respect to information to be protected,--
specifically, the category of source selection information 
referred to as ``other information''--the Committee cautions 
agencies to use the authority to designate non-standard 
material as ``source selection information'' only in truly 
unique situations as authorized by senior agency officials. 
While it is imperative that source selection information be 
protected, the ability to designate non-standard material 
should be used carefully. Further, while title III provides 
remedies similar to those available under current law, it 
repeals the complex system of certifications demanded by 
current law to ensure compliance. Non-value added certification 
requirements do more to deter participation in the government 
market than to deter the prohibited conduct.

Title IV

    Recently, the current bid protest system has come under 
attack as being too complex, too intrusive, and too 
procedurally intensive.
    The Committee strongly believes that there is a critical 
role for a meaningful and robust protest process in order to 
ensure that the discretion granted the government's procurement 
officials is exercised responsibly and within the statutorily 
designated parameters. Even more important is the role of the 
protest process in ensuring the perception of fairness in the 
government's acquisition system. However, the Committee 
recognizes that the current system, based primarily on the two 
administrative forums--one in the General Accounting Office 
(GAO) and the General Services Board of Contract Appeals 
(GSBCA)--presents contractors with a bewildering array of 
procedural rules and features and seemingly incomprehensible 
jurisdictional differences.
    The provisions of title VI will create a new protest 
resolution system and consolidate the current contract disputes 
process, which is currently spread out among 11 different 
administrative boards. These functions will be handled by two 
consolidated boards with more efficient procedures and an 
increased use of alternate dispute resolution. The new 
Department of Defense Board of Contract Appeals will resolve 
protests and disputes involving Department of Defense 
Acquisitions, while the new Civilian Agency Board of Contract 
Appeals will do the same for executive agencies other than the 
Department of Defense. The Committee's intent in creating the 
new dispute and protest resolution process is to achieve a 
better balance between the need to ensure the fundamental 
fairness of the government's acquisition system and the need to 
acquire the goods and services needed by the government in a 
efficient manner.
    The new Boards will be governed by a single set of 
streamlined and simplified procedures which are based upon the 
best features of both of the current bid protest forums. In 
developing the outlines of these procedures in the legislation, 
the Committee was mindful of the need to curb the use of 
intrusive discovery procedures such as depositions and 
interrogatories in the protest process. For this reason, the 
Committee has specified a $20,000,000 threshold (including 
options) below which only written discovery is to be used. 
While formal hearings would not be held in such below threshold 
protests, the Committee contemplates that informal conferences 
for the discussion of the protest issues could be held at the 
discretion of the Board judge. Further, in order to add needed 
flexibility to handle complex cases below $20,000,000, the 
legislation provides that below threshold cases may be accorded 
full procedural treatment if the Chairman determines that the 
unique circumstances of the case so dictate.
    In addition, the Administration proposed statutory language 
to make unallowable the costs of pursuing a bid protest. The 
Committee rejected this proposal which would add further 
prescriptions to the procurement process as inconsistent with 
the streamlining goals of this bill. The Committee takes no 
position on the merits of this issue. Further, the Committee 
would not object to the Administration addressing cost 
reimbursement issues in regulations.
    Additionally, the Committee intends that the use of 
interrogatories and depositions be limited for protests of 
contract actions above the threshold. The Committee further 
intends that hearings should be held only if the protest can 
not be resolved on the written record and that hearings should 
be held sparingly in appropriate cases. The Committee intends 
that, in developing the procedural rules and standards, both 
Chairman will adhere strictly to the clear statutory direction 
that discovery is to be limited to the minimum necessary for 
the expeditious, fair, and cost-effective resolution of 
protests. Finally, the Committee expects that all Board judges 
will be mindful of the adverse impact of overly intrusive 
discovery upon the procurement system as a whole and also will 
adhere to the ``minimum necessary'' standard in approving the 
use of discovery in cases before them.

                     b. section by section analysis

                          TITLE I--COMPETITION

Section 101--Improvement of competition requirements

    Subsection (a) would amend 10 U.S.C. 2304(a) governing 
armed services acquisitions to establish a new standard of full 
and open competition for the acquisition of goods and services 
that would provide ``open access'' to the government market for 
all responsible sources through the use of competitive 
procedures. To provide balance, the new standard would 
incorporate the principle that the government would be 
permitted to focus competition it receives on the need to 
efficiently fulfill its requirements. This would result in a 
system which permits all responsible firms to submit offers in 
response to government requirements while at the same time 
granting contracting officials the discretion they need to 
efficiently select the most advantageous offeror. In order to 
parallel the new competition standard, the subsection would 
also amend 10 U.S.C. 2304(g)(3) which sets forth the standard 
for the use of competition in simplified procedures for 
acquisitions under the simplified acquisition threshold to 
provide that agencies obtaincompetition to the maximum extent 
practicable consistent with the particular requirement 
solicited.
    The subsection would further streamline and modernize the 
current competition requirements by amending 10 U.S.C. 
2304(b)(1) to eliminate from statute the long list of 
circumstances under which an agency may exclude a particular 
firm in order to maintain an alternate source for goods or 
services and would place the discretion for the use of this 
authority in the contracting agencies under circumstances to be 
set forth in the Federal Acquisition Regulation (FAR).
    Similarly, the subsection would eliminate the maze of 
rules, paperwork-generating approval requirements, and detailed 
instructions in 10 U.S.C. 2304 (c), (d), (e) and (f) that 
currently govern the use of ``other than competitive 
procedures'' and substitute a simple provision stating that 
competitive procedures must be used unless such procedures are 
determined to be not feasible or appropriate in accordance with 
standards set forth in the FAR. In addition, the subsection 
would provide that the FAR set forth strict standards for sole-
source awards based upon the seven exceptions to the use of 
competitive procedures set forth in current law. The use of 
``other than competitive procedures,'' which includes limited 
competition and sole-source awards, must be justified and 
approved in accordance with simplified standards to be set 
forth in the FAR.
    Subsection (b) would replicate the above changes in title 
41, the Federal Property and Administrative Services Act of 
1949 (Federal Property Act), governing the acquisitions of 
civilian agencies.
    Subsection (c) would amend the Office of Federal 
Procurement Policy Act (OFPP Act) at section 18 (41 U.S.C. 416) 
to establish a uniform notice requirement for acquisitions 
between $10,000 and $25,000, provide for the inclusion of 
additional information regarding qualification requirements in 
published notices of acquisitions above $25,000 and make other 
conforming changes.
    Subsection (d) would amend the OFPP Act at 41 U.S.C. 414 to 
integrate the new competition standard into the enumerated 
executive agency procurement responsibilities and at 41 U.S.C. 
418 to remove obsolete language regarding competition 
advocates.

Section 102--Definitions relating to competition requirements

    The section would amend the OFPP Act at 41 U.S.C. 403 to 
remove the definition of ``full and open competition'' and to 
define the terms ``open access'' and ``competitive procedures'' 
as the operative elements of the new competition standard. 
According to the new definition, ``open access'' would be 
achieved when all responsible sources are permitted to submit 
offers under ``competitive procedures.'' ``Competitive 
procedures'' would be defined as those under which an agency 
enters into a contract pursuant to full and open competition 
that provides open access and is consistent with the 
government's needs to efficiently fulfill its requirements. The 
section also would provide for other amendments to the OFPP 
Act, title 10, the Federal Property Act, and other laws to 
conform them to the new competition standard.

Section 103--Contract solicitation amendments

    The section would amend 10 U.S.C. 2305 (a) and (b) 
governing armed services acquisitions to revise a provision 
concerning solicitation specifications to make it consistent 
with the new competition standard and to further conform the 
provision regarding the competitive range. The section would 
amend the Federal Property Act at 41 U.S.C. 253a and 253b in 
the same manner.

Section 104--Preaward debriefings

    The section would amend 10 U.S.C. 2305(b) and the Federal 
Property Act at 41 U.S.C. 253b to augment the new debriefing 
requirements added by FASA to permit a firm removed from the 
competitive range to request a debriefing after receiving 
notice of the removal, but before award. The agency may deny 
the request for a debriefing to be held at that time if it is 
not in the government's best interest to do so in accordance 
with procedures set forth in the FAR. Such a refusal would not 
result in a firm's loss of its right to a debriefing as long as 
the request is made when the firm is notified of its removal 
from the competition. The debriefing would then be held after 
award in accordance with current law.

Section 105--Contract types

    The section would amend 10 U.S.C. 2306 and 41 U.S.C. 254 to 
provide that the selection of contract type is to be governed 
by market conditions, established commercial practice and sound 
business judgement. To further the commercialization of the 
government's acquisition process, existing fee limits on 
specified contract types are to be eliminated. The section also 
would eliminate from title 10 service-specific provisions that 
set forth a six percent fee limit on architect-engineering 
services contracts. It would add a new section 2332 to title 10 
to provide the authority to procure such services for civil 
works.

Section 106--Contractor performance

    The section would add a new provision to the OFPP Act to 
establish in the FAR an alternative quality-based pre-
qualification system for meeting the government's recurring 
needs. The system would be open to all sources, including small 
businesses. Firms would be included as ``verified'' contractors 
after passing scrutiny based on an assessment of the firm's 
business practices, level of quality of its product or service, 
and relevant past contract performance. Past performance would 
include the consideration of a firm's performance under 
contracts with State and local governments, contracts with 
private sector entities, as well as those with the Federal 
government.
    Once in the system, firms would become eligible to compete 
with other ``verified'' firms in acquisitions conducted within 
the system. The ``verification'' could be revoked based upon 
the expiration of a specified time period or for a firm's 
failure to maintain the requisite performance quality. In the 
case of a revocation, the firm would be provided a fair 
opportunity to reenter the system. The existing pre-
qualification requirements in 10 U.S.C. 2319 and 41 U.S.C. 253c 
would be repealed.

                       TITLE II--COMMERCIAL ITEMS

Section 201--Commercial item exception to requirement for cost or 
        pricing data and information limitations

    The section would amend 10 U.S.C. 2306a and 41 U.S.C. 
254b--the ``Truth in Negotiations Act'' (TINA) provisions--to 
exempt all acquisitions for commercial products and services 
which fit within the definition of commercial item in the OFPP 
Act at 41 U.S.C. 403 from the requirement to submit certified 
cost or pricing data.
    The section also would eliminate the data and audit 
requirements applicable to some commercial items under the 
current TINA provisions. The section would conform the TINA 
provisions regarding the submission of information to be 
considered in determining price reasonableness when certified 
cost and pricing data are not required either because a TINA 
exemption applies or the acquisition is not expected to exceed 
the $500,000 TINA threshold. The amended provisions would state 
that the FAR shall provide appropriate limitations on 
information that should be considered in determining price 
reasonableness, including specific limits on information 
requests relating to commercial items. Finally, the section 
would strike subsections (h) in titles 10 and 41 as no longer 
needed.

Section 202--Application of simplified procedures to commercial items

    The section would amend 10 U.S.C. 2304(e), as amended by 
section 101(a) and 41 U.S.C. 253, as amended by section 101(b), 
to provide that all acquisitions for commercial items, no 
matter what their dollar value, can be conducted pursuant to 
special simplified commercial-type procedures that currently 
are authorized for acquisitions below the simplified 
acquisition threshold. The section would provide that such 
purchases may not be made on a sole-source basis unless first 
justified in writing and approved in accordance with the FAR. 
Further, it would provide for the documentation in the contract 
file of the procedures used for the purchase and of the number 
of offers received. The section would also amend the OFPP Act 
to conform the notice provisions for commercial items to the 
use of simplified procedures.

Section 203--Amendment to definition of commercial items

    The section would amend the OFPP Act at 41 U.S.C. 
403(12)(F) to remove the requirement in the definition of 
commercial services added by FASA that they be sold based on 
established ``catalog'' prices. To be considered ``commercial'' 
services under this section they would have to be offered and 
sold at ``established prices'' rather than at established 
``catalog'' prices. Since commercial services are often offered 
at prices that may not fit the strict definition of a catalog 
(e.g., commercial price lists, advertisements, etc.), the 
section is intended to more accurately reflect the commercial 
market, yet ensure that the services are clearly defined and 
actually available commercially.

Section 204--Inapplicability of cost accounting standards to contracts 
        and subcontracts for commercial items

    The section would amend the OFPP Act at 41 U.S.C. 422(f)(2) 
to make it clear that all contracts for commercial items are 
exempt from the burdens of the cost accounting standards. This 
provision would complement section 201 which exempts all 
acquisitions for commercial items from the requirement to 
submit certified cost or pricing data as well as from the 
accompanying audit requirements.

                TITLE III--ADDITIONAL REFORM PROVISIONS

Section 301--Government reliance on the private sector

    The section would amend the OFPP Act by adding a new 
section 17 providing that it is the policy of the government to 
rely on private sector sources to supply its needs. The policy 
that would be set forth in this section has been the policy 
underpinning the government's acquisition system since 1955 and 
reflects the language currently in Office of Management and 
Budget Circular A-76.

Section 302--Elimination of certain certification requirements

    The section would provide for the elimination of specified 
certification requirements currently in statute and would 
require the removal of current regulatory certifications unless 
retention is supported by a written justification. The section 
also would amend the OFPP Act to prohibit the inclusion in the 
FAR or agency procurement regulations of new certification 
requirements unless mandated by statute or justified in 
writing.

Section 303--Amendment to commencement and expiration of authority to 
        conduct certain tests of procurement procedures

    The section would amend section 5061 of FASA, 41 U.S.C. 413 
note, to permit the OFPP Administrator to exercise the 
authority granted in FASA to test ``innovative'' procurement 
procedures without having to wait for the implementation of 
other FASA provisions.

Section 304--International competitiveness

    The section would amend 22 U.S.C. 2761(e) to eliminate the 
requirement for recoupment of non-recurring research and 
development charges for products sold through the foreign 
military sales program. It would require the President and 
Congress to include budgetary offsets beginning in FY 1997.

Section 305--Procurement integrity

    The section would amend the OFPP Act at 41 U.S.C. 423 to 
repeal the current ``Procurement Integrity'' provisions and its 
complex system of certifications and substitute a direct 
prohibition against the unauthorized disclosure and receipt of 
procurement-sensitive information. One who would violate the 
prohibitions of the section would be subject to criminal and 
civil penalties and appropriate administrative actions. The 
section would contain prohibitions and remedies which would be 
similar to those regarding the disclosure of procurement-
sensitive information contained in the current ``Procurement 
Integrity'' provisions. Finally, the section would eliminate 
the remaining agency-specific post-employment restrictions 
which became redundant with the passage of the Ethics Reform 
Act of 1989.

Section 306--Further acquisition streamlining provisions

    The section would amend several provisions of the OFPP Act 
to update and clarify the statement in 41 U.S.C. 404 of OFPP's 
purpose and to repeal unneeded or obsolete provisions at 41 
U.S.C. 401, 402, 407, 409 and 410.
Section 307--Justification of major defense acquisition programs not 
        meeting goals

    This section would amend 10 U.S.C. 2220(b) to provide that 
the Secretary of Defense shall justify to Congress continuation 
of any program that is more than 50 percent over its cost 
goals, fails to achieve at least 50 percent of its performance 
capability goals, or is more than 50 percent behind schedule.

Section 308--Enhanced performance incentives for acquisition workforce

    This section would require, for both Defense and civilian 
agencies, enhanced performance incentives for the acquisition 
workforce. These incentives would include pay bands, 
significant pay and promotion incentives and unfavorable 
personnel actions to be based on contributions of personnel to 
the performance of the acquisition program.

Section 309--Results oriented acquisition program cycle

    The section would require the Secretary of Defense to 
ensure that regulations regarding acquisition program cycle 
procedures compress time periods associated with developing, 
procuring and making operational new systems and that the 
Department of Defense directives are consolidated and made 
consistent with such compressed time periods.

Section 310--Rapid contracting goal

    This section would amend the OFPP Act to require the 
establishment of a government-wide goal of reducing by 50 
percent the time necessary for executive agencies to acquire an 
item for the user.

Section 311--Encouragement of multiyear contracting

    The section would amend both titles 10 and 41 to provide 
that executive agencies shall, to the maximum extent possible, 
use multiyear contracting.

Section 312--Contractor share of gains and losses from cost, schedule, 
        and performance experience

    The section would require that the FAR include provisions 
on rewarding contractors for performance which exceeds cost, 
schedule or performance parameters and penalizing them for 
failing to meet such parameters.

Section 313--Phase funding of defense acquisition programs

    The section would require the Secretary of Defense to 
submit to Congress information concerning the phase of an 
acquisition program identifying the intended user of the system 
and the objective criteria for assessing the extent to which 
the objectives and goals pursuant to 10 U.S.C. 2345 are 
achieved.

Section 314--Improved Department of Defense contract payment procedures

    The section would require the Comptroller General to review 
commercial practices regarding accounts payable and develop 
standards for the Secretary of Defense to consider for 
improving DOD's contract payment procedures and financial 
systems.

Section 315--Consideration of past performance in assignment to 
        acquisition positions

    The section would require that the Secretary of Defense's 
policies and procedures provide that education and training in 
acquisition and past performance of acquisition 
responsibilities are major factors in the selection of 
personnel for acquisition positions.

Section 316--Additional Department of Defense pilot programs

    The section would add to the current pilot programs set 
forth in section 5064 of FASA a new program, the Joint Standoff 
Weapon Unitary Variant (JSOW-UV). In addition, the section 
would permit the Secretary of Defense to conduct a new pilot 
program to be called the ``defense facility-wide pilot 
program.'' This pilot would apply enumerated statutory 
exemptions and authorities to all contracts performed at 
designated facilities.

Section 317--Value engineering for Federal agencies

    The section would add a new section to the OFPP Act to 
provide that each executive agency establish and maintain 
effective value engineering procedures and processes.

Section 318--Workforce

    The section would amend the OFPP Act to establish policies 
and procedures for the effective management, including 
accession, education, training, career development, and 
performance incentives of the civilian agencies' acquisition 
workforce.

              TITLE IV--STREAMLINING OF DISPUTE RESOLUTION

                     Subtitle A--General Provisions

Section 401--Definitions

    The section would amend the OFPP Act to set forth 
definitions of the terms needed to create and operate two new 
consolidated boards for the resolution of the government's 
contract disputes and review of bid protests. The new 
Department of Defense Board of Contract Appeals (Defense Board) 
would resolve disputes and protests involving Department of 
Defense acquisitions. The new Civilian Agency Board of Contract 
Appeals (Civilian Board) would resolve disputes and protests 
involving acquisitions of executive agencies other than the 
Department of Defense. The Defense Board and the Civilian Board 
would replace the current agency boards of contract appeals and 
the General Accounting Office (GAO) bid protest section. The 
definitions of ``protest,'' ``interested party,'' and 
``prevailing party'' would be similar to those set forth in 
FASA.

 Subtitle B--Establishment of Civilian and Defense Boards of Contract 
                                Appeals

Section 411--Establishment

    The section would amend the Contract Disputes Act of 1978 
(41 U.S.C. 607) to establish the Defense Board in the 
Department of Defense and the Civilian Board in the General 
Services Administration.

Section 412--Membership

    The section would amend the OFPP Act to provide that the 
Defense Board and the Civilian Board consist of judges 
appointed by the respective chairman. New judges would be 
selected and appointed in the same manner as administrative law 
judges pursuant to 5 U.S.C. 3105, with the additional 
requirement that they have at least 5 years public contract law 
experience. The judges would be subject to removal as 
administrative law judges pursuant to 5 U.S.C. 7521 and 
compensated pursuant to 5 U.S.C. 5372a. Current board judges 
and certain GAO employees would serve as Board judges.

Section 413--Chairman

    The section would amend the OFPP Act to provide for the 
designation of the Chairman of the Defense Board by the 
Secretary of Defense and for the designation of the Chairman of 
the Civilian Board by the Administrator of General Services. 
The section also would provide for the respective Chairmen's 
executive and administrative responsibilities as well as for 
the designation of Vice Chairmen by the Chairmen. Finally, the 
section would provide for the division of each of the board 
into two sections. One section would be responsible for 
contract disputes and the other for protests.

Section 414--Rulemaking authority

    The section would amend the OFPP Act to provide that the 
Chairman of the Defense Board and the Chairman of the Civilian 
Board shall jointly issue and maintain procedural rules and 
regulations necessary to resolve disputes and protests in both 
Boards.
Section 415--Authorization of appropriations

    The section would amend the OFPP Act to provide for the 
authorization of sums to be appropriated for FY 1997 and 
beyond. It would provide that the funds for the activities of 
each Board shall be separately appropriated.

   Subtitle C--Functions of Defense and Civilian Boards of Contract 
                                Appeals

Section 421--Alternate dispute resolution services

    The section would amend the OFPP Act to provide that each 
Board offer alternate dispute resolution services for any 
contract- related disagreement.

Section 422--Alternative dispute resolution of disputes and protests 
        submitted to boards

    The section would amend the OFPP Act to provide that a 
judge or attorney of the respective Board shall meet with the 
parties to the protest or dispute to attempt to resolve the 
matter through use of an alternate method of dispute 
resolution. Section 424(g)(4) of this Act would permit this 
process to take up to 20 days without impacting the time limits 
for issuing decisions.

Section 423--Contract disputes

    The section would amend the OFPP Act to provide that the 
Defense Board would have jurisdiction over contract disputes as 
provided by section 8(a) of the Contract Disputes Act. The 
section would further provide that the Civilian Board would 
have jurisdiction over contract disputes as provided by section 
8(b) of the Contract Disputes Act.

Section 424--Protests

    The section would amend the OFPP Act to provide that the 
Defense Board or the Civilian Board, as the case may be, shall 
review decisions by the head of an executive agency alleged by 
an interested party to violate statute or regulation and that 
in deciding protests the Board concerned may consider all 
evidence relevant to the decision under protest. The section 
also would provide that decisions protested be presumed correct 
and that the protester may rebut such presumption by showing by 
a preponderance of the evidence that the decision was arbitrary 
or capricious or violated a statute or regulation.
    Further, the section would provide procedures for the 
suspension of contract award in protests filed before award and 
for the suspension of contract performance in protests filed 
after award. Such suspensions could be lifted by the head of 
the procuring activity upon a written finding that urgent and 
compelling circumstances would not permit waiting for the 
decision. The section would provide that the Board concerned 
conduct proceedings and permit such discovery of relevant 
material to the minimum extent necessary for the expeditious, 
fair and cost-effective resolution of protests.
    The section also would provide for simplified procedures, 
including written discovery, for the resolution of most 
protests of procurements below $20,000,000. The use of these 
simplified procedures could be waived if the Board Chairman 
concerned determines that special and unique circumstances 
would require the use of full procedures. The section would 
further provide for the dismissal and payment of costs for 
frivolous protests.
    Finally, among other things, the section would provide that 
decisions be issued within 65 days, or within 40 days, if 
simplified procedures are used, for the appeal of Board 
decisions in accordance with section 8(g)(1) of the Contract 
Disputes Act, for the corrective actions to be ordered by the 
Boards and for the Boards' authority to declare the entitlement 
of a prevailing party to its protest costs.

Section 425--Applicability to contracts for commercial items

    The section would amend the OFPP Act to provide that the 
authority conferred on the Defense Board and the Civilian Board 
is applicable to procurements for commercial items and to 
procurements at or below the simplified acquisition threshold.

    Subtitle D--Repeal of Other Statutes Authorizing Administrative 
                                Protests

Section 431--Repeals

    The section would repeal the current statutory authority 
for the GSBCA and for the GAO bid protest function.

    Subtitle E--Transfers and Transitional, Savings, and Conforming 
                               Provisions

Section 441--Transfer and allocation of appropriations and personnel

    The section would provide for the transfer of the personnel 
and assets, etc. of the Armed Services Board of Contract 
Appeals (ASBCA) to the Defense Board and for the transfer of 
the personnel and assets, etc. of the agency boards of contract 
appeals, other than the ASBCA, to the Civilian Board. Further, 
the section would provide for the transfer of one third of the 
relevant GAO personnel and assets to the Civilian Board and two 
thirds to the Military Board. Finally, the section would 
provide that the personnel transferred could not be separated 
or reduced in compensation for one year after the transfer and 
would set forth the standards to be followed by the Boards for 
possible later reductions in force.

Section 442--Terminations and savings provisions

    The section would provide the rules for affect on pending 
proceedings before the agency boards and GAO.

Section 443--Contract disputes authority of board

    The section would provide conforming amendments to the 
Contract Disputes Act of 1978 needed by the establishment of 
the Defense and Civilian Boards regarding contract disputes.

Section 444--References to agency boards of contract appeals

    The section would provide that any reference to the ASBCA 
be treated as referring to the Defense Board and that any 
reference to an agency board of contract appeals other than the 
ASBCA be treated as referring to the Civilian Board.

Section 445--Conforming amendments

    The section would provide for the necessary conforming 
amendments to title 5, title 10, the Federal Property Act, and 
the OFPP Act.

       Subtitle F--Effective Date; Interim Appointment and Rules

Section 451--Effective date
    The section would provide for an effective date of October 
1, 1996.

Section 452--Interim appointment

    The section would provide for the current Chairman of the 
GSBCA to serve as the Chairman of the Civilian Board for two 
years and for the current Chairman of the ASBCA to serve as 
Chairman of the Department of Defense Board for two years.

Section 453--Interim rules

    The section would provide for the rules of procedure of the 
GSBCA to apply to protests before both the Defense and Civilian 
Boards until the Boards promulgate their procedural rules. The 
section also would provide that for contract disputes the rules 
of the ASBCA would be applied by the Defense Board and that the 
rules of the GSBCA would be applied by the Civilian Board until 
the new rules are promulgated. Finally, the rules of the ASBCA 
regarding Board judges would apply to the Defense Board judges 
while the rules of the GSBCA would apply to the Civilian Board 
judges until relevant Board rules are promulgated.

              TITLE V--EFFECTIVE DATES AND IMPLEMENTATION

Section 501--Effective date and applicability

    The section would provide that the Act would take effect on 
the date of enactment, except as otherwise provided in the Act 
and that the amendments made by the Act would apply in the 
manner prescribed in the final regulations and on the date 
provided in the implementing regulations or on October 1, 1996, 
whichever is earlier.

Section 502--Implementing regulations

    The section would provide a schedule for the promulgation 
of the implementing regulations.

                      IV. Compliance With Rule XI

    Pursuant to rule XI, 2(l)(3)(A), of the Rules of the House 
of Representatives, under the authority of rule X, clause 
2(b)(1) and clause 3(f), the results and findings from those 
oversight activities are incorporated in the recommendations 
found in the bill and in the report.

                   V. Budget Analysis and Projections

    This Act provides for no new authorization or budget 
authority or tax expenditures. Consequently, the provisions of 
section 308(a)(1) of the Congressional Budget Act are not 
applicable.

          VI. Cost Estimate of the Congressional Budget Office

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, August 1, 1995.
Hon. William F. Clinger, Jr.,
Chairman, Committee on Government Reform and Oversight, House of 
        Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
reviewed H.R. 1670, the Federal Acquisition Reform Act of 1995 
as ordered reported by the House Committee on Government Reform 
and Oversight on July 27, 1995. The bill would make several 
changes to the federal procurement system, including:
          encouraging the substitution of commercial items for 
        goods developed according to unique government 
        specifications;
          relaxing requirements that result in contractors 
        collecting and supplying data specific to the federal 
        government;
         centralizing the boards of contract appeals in 
        individual agencies into a defense board and a civilian 
        board;
         requiring agencies to establish policies and 
        procedures for recruiting and managing procurement 
        personnel; and
         amending the Arms Export Control Act to eliminate the 
        requirement that non-recurring charges be recouped in 
        foreign military sales.
    Overall, H.R. 1670 is likely to reduce costs that the 
federal government would incur for goods and services it would 
purchase from the private sector. Any such savings would allow 
agencies to make more efficient use of their appropriated 
funds, but would affect total spending only if overall 
appropriations were reduced accordingly. CBO has no basis for 
estimating the amounts of potential federal savings that could 
be achieved by implementing the procurement reforms contained 
in H.R. 1670. The bill would have no effect on the budgets of 
state and local governments.
    H.R. 1670 would facilitate procurement of commercial items 
instead of goods developed to unique government specifications. 
The government often bears added costs when it specifies in 
unusual detail what a contractor must provide. The literature 
on government procurement suggests that the government 
frequently sets standards for its purchases that make them more 
costly, but not substantially more useful than other products 
available through normal commercial channels. Extra development 
costs and forgone economies of scale increase the cost of 
products produced uniquely for the federal government. 
Increasing reliance on commercially available products would 
lower costs.
    In addition, the bill could lead to budgetary savings by 
relaxing policies that require government contractors to supply 
data that they do not have to collect or provide in ordinary 
business dealings. Firms that bid on federal contracts often 
have to maintain a separate, government-specific accounting 
system for information that its other customers do not require. 
Much of the data requirements aim at assuring the government 
that it is getting the most for its money, but some of this 
data is used to verify that certain socioeconomic and domestic 
production goals are met. By easing many of the existing 
requirements for data, the bill may encourage more firms to bid 
on government contracts, which might lower prices through 
increased competition. Reducing the information burden also may 
lower bids from all firms if bidders can dispense with separate 
accounting systems for federal and commercial contracts.
    Furthermore, H.R. 1670 would establish boards of contract 
appeals within the Department of Defense (DoD) and within the 
General Services Administration to replace 11 existing agency 
boards and would encourage the use of alternative means of 
dispute resolution. After some small administrative costs to 
form the two boards, it is possible that savings could be 
achieved from such a centralization. In addition, increased use 
of alternative dispute resolution could result in a more 
efficient contract appeals process. Also, the bill would enable 
these boards to require compensation to the United States in 
protest cases found to be frivolous or pursued in bad faith.
    The bill also would affect how agencies recruit and manage 
personnel who carry out procurement functions, by establishing 
stricter qualifications for employment, strengthening the 
incentives and penalties related to performance, and 
encouraging funding for the training and education of such 
personnel. The bill would require relevant agencies to request 
an amount greater than or equal to 2.5 percent of the base 
aggregate salary cost of their procurement personnel. To offset 
this cost, the bill also would require that the agencies reduce 
their base aggregate salary cost by an equal amount. While 
these measures could yield increased efficiencies to agencies 
by providing a more competent and productive workforce, it is 
also possible that they could lead to greater net costs if the 
efficiency gains and relatively unenforceable constraints on 
aggregate salaries save less than the costs of the new training 
programs.
    H.R. 1670 also would amend the Arms Export Control Act to 
eliminate--contingent on future legislation--the requirement 
that non-recurring research and development charges related to 
products sold through the foreign military sales program be 
recouped by the federal government. This provision would result 
in a loss of receipts, except that additional legislation must 
first be enacted for the express purpose of fully offsetting 
the loss of receipts estimated to occur for each of fiscal 
years 1998 through 2000. Further, the additional legislation 
must be certified as fully offsetting by CBO and the Office of 
Management and Budget.
    This bill contains several other provisions that could 
result in budgetary savings. CBO, however, does not have 
sufficient information to estimate either the extent to which 
the changes in law would translate into changes in standard 
procurement practices, or the savings that would result. In 
sum, CBO estimates that savings from new procurement practices 
would equal or exceed minor costs from other provisions of H.R. 
1670. Because H.R. 1670 would not affect direct spending or 
receipts, pay-as-you-go procedures would not apply.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are John R. 
Righter, who can be reached at 226-2860, and for defense 
provisions, Kent Christensen, who can be reached at 226-2840.
            Sincerely,
                                              James J. Blum
                                   (For June E. O'Neill, Director).

                   VII. Inflationary Impact Statement

    In accordance with rule XI, clause 2(l)(4) of the Rules of 
the House of Representatives, this legislation is assessed to 
have no inflationary effect on prices and costs in the 
operation of the national economy.

                     VIII. Changes in Existing Law
  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

                      TITLE 10, UNITED STATES CODE

          * * * * * * *

                    Subtitle A--General Military Law

          * * * * * * *

                           PART II--PERSONNEL

          * * * * * * *

               CHAPTER 87--DEFENSE ACQUISITION WORKFORCE

          * * * * * * *
         SUBCHAPTER I--GENERAL AUTHORITIES AND RESPONSIBILITIES

          * * * * * * *

Sec. 1701. Management policies

  (a) Policies and Procedures.--The Secretary of Defense shall 
establish policies and procedures for the effective management 
(including accession, education, training, and career 
development) of persons serving in acquisition positions in the 
Department of Defense. The policies and procedures shall 
provide that education and training in acquisition matters, and 
past performance of acquisition responsibilities, are major 
factors in the selection of personnel for assignment to 
acquisition positions in the Department of Defense.
          * * * * * * *
              SUBCHAPTER II--DEFENSE ACQUISITION POSITIONS

          * * * * * * *

Sec. 1723. General education, training, and experience requirements

  (a) Qualification Requirements.--The Secretary of Defense 
shall establish education, training, and experience 
requirements, including requirements relating to demonstrated 
past performance of acquisition duties, for each acquisition 
position, based on the level of complexity of duties carried 
out in the position. Unless otherwise provided in this chapter, 
such requirements shall take effect not later than October 1, 
1993. In establishing such requirements for positions other 
than critical acquisition positions designated pursuant to 
section 1733 of this title, the Secretary may state the 
requirements by categories of positions.
          * * * * * * *

Sec. 1724. Contracting positions: qualification requirements

  (a) Contracting Officers.--The Secretary of Defense shall 
require that, beginning on October 1, 1993, 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 small purchase threshold referred to in section 
2304(g) of this title, a person must (except as provided in 
subsections (c) and (d))--
          (1) have completed all mandatory contracting courses 
        required for a contracting officer at the grade level, 
        or in the position within the grade of the General 
        Schedule (in the case of an employee), that the person 
        is serving in;
          (2) have at least two years of experience in a 
        contracting position and have demonstrated proficiency 
        in the performance of acquisition duties in the 
        contracting position or positions previously held;
          * * * * * * *

                   SUBCHAPTER III--ACQUISITION CORPS

          * * * * * * *

Sec. 1735. Education, training, and experience requirements for 
                    critical acquisition positions

  (a) Qualification Requirements.--In establishing the 
education, training, and experience requirements under section 
1723 of this title for critical acquisition positions, the 
Secretary of Defense shall, at a minimum, include the 
requirements set forth in subsections (b) through (e).
  (b) Program Managers and Deputy Program Managers.--Before 
being assigned to a position as a program manager or deputy 
program manager of a major defense acquisition program or a 
significant nonmajor defense acquisition program, a person--
          (1) must have completed the program management course 
        at the Defense Systems Management College or a 
        management program at an accredited educational 
        institution determined to be comparable by the 
        Secretary of Defense;
          (2) must have executed a written agreement as 
        required in section 1734(b)(2); [and]
          (3) in the case of--
                  (A) * * *
          * * * * * * *
                  (D) a deputy program manager of a significant 
                nonmajor defense acquisition program, must have 
                at least four years of experience in 
                acquisition[.]; and
          (4) must have demonstrated proficiency in the 
        performance of acquisition duties.
  (c) Program Executive Officers.--Before being assigned to a 
position as a program executive officer, a person--
          (1) must have completed the program management course 
        at the Defense Systems Management College or a 
        management program at an accredited educational 
        institution in the private sector determined to be 
        comparable by the Secretary of Defense, acting through 
        the Under Secretary of Defense for Acquisition and 
        Technology;
          (2) must have at least 10 years experience in an 
        acquisition position, at least four years of which were 
        performed while assigned to a critical acquisition 
        position; [and]
          (3) must have held a position as a program manager or 
        a deputy program manager[.]; and
          (4) must have demonstrated proficiency in the 
        performance of acquisition duties.
  (d) General and Flag Officers and Civilians in Equivalent 
Positions.--Before a general or flag officer, or a civilian 
serving in a position equivalent in grade to the grade of such 
an officer, may be assigned to a critical acquisition position, 
the person must have at least 10 years experience in an 
acquisition position, at least four years of which were 
performed while assigned to a critical acquisition position, 
and have demonstrated proficiency in the performance of 
acquisition duties.
  (e) Senior Contracting Officials.--Before a person may be 
assigned to a critical acquisition position as a senior 
contracting official, the person must have at least four years 
experience in contracting, and have demonstrated proficiency in 
the performance of acquisition duties.
          * * * * * * *

               PART IV--SERVICE, SUPPLY, AND PROCUREMENT

          * * * * * * *

                 CHAPTER 131--PLANNING AND COORDINATION
Sec.
2201.  Apportionment of funds: authority for exemption; excepted 
          expenses.
     * * * * * * *
2221.  Funding for results oriented acquisition program cycle.
     * * * * * * *
Sec. 2220. Performance based management: acquisition programs

  (a) * * *
  (b) Annual Reporting Requirement.--The Secretary of Defense 
shall include in the annual report submitted to Congress 
pursuant to section 113(c) of this title an assessment of 
whether major and nonmajor acquisition programs of the 
Department of Defense are achieving, on average, 90 percent of 
cost, performance, and schedule goals established pursuant to 
subsection (a) and whether the average period for converting 
emerging technology into operational capability has decreased 
by 50 percent or more from the average period required for such 
conversion as of the date of the enactment of the Federal 
Acquisition Streamlining Act of 1994. The Secretary shall use 
data from existing management systems in making the assessment. 
In addition, the Secretary shall include in such annual report 
a justification for the continuation of any program that--
          (1) is more than 50 percent over the cost goal 
        established for the development, procurement, or 
        operational phase of the program;
          (2) fails to achieve at least 50 percent of the 
        performance capability goals established for the 
        development, procurement, or operational phase of the 
        program; or
          (3) is more than 50 percent behind schedule, as 
        determined in accordance with the schedule goal 
        established for the development, procurement, or 
        operational phase of the program.
          * * * * * * *
Sec. 2221. Funding for results oriented acquisition program cycle

  Before initial funding is made available for the development, 
procurement, or operational phase of an acquisition program for 
which an authorization of appropriations is required by section 
114 of this title, the Secretary of Defense shall submit to 
Congress information about the objectives and plans for the 
conduct of that phase and the funding requirements for the 
entire phase. The information shall identify the intended user 
of the system to be acquired under the program and shall 
include objective, quantifiable criteria for assessing the 
extent to which the objectives and goals determined pursuant to 
section 2435 of this title are achieved.
          * * * * * * *
                   CHAPTER 137--PROCUREMENT GENERALLY
Sec.
     * * * * * * *
2304.  Contracts: competition requirements.
     * * * * * * *
2304f.  Merit-based selection.
     * * * * * * *
[2306.  Kinds of contracts.]
2306.  Contract types
     * * * * * * *
2306c. Contractor share of gains and losses from cost, schedule, and 
          performance experience.
     * * * * * * *
[2319.  Encouragement of new competitors.]
     * * * * * * *
2332. Contracts for architectural and engineering services.
     * * * * * * *
Sec. 2302. Definitions

  In this chapter:
          * * * * * * *
          (2) [The term ``competitive procedures'' means 
        procedures under which the head of an agency enters 
        into a contract pursuant to full and open competition.] 
        The term ``competitive procedures'' means procedures 
        under which an agency enters into a contract pursuant 
        to full and open competition that provides open access 
        and is consistent with the need to efficiently fulfill 
        the Government's requirements. Such term also 
        includes--
                  (A) * * *
          * * * * * * *
          (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] 
                open access''.
          * * * * * * *

[Sec. 2304. Contracts: competition requirements

  [(a)(1) Except as provided in subsections (b), (c), and (g) 
and except in the case of procurement procedures otherwise 
expressly authorized by statute, the head of an agency in 
conducting a procurement for property or services--
          [(A) shall obtain full and open competition through 
        the use of competitive procedures in accordance with 
        the requirements of this chapter and the Federal 
        Acquisition Regulation; and
          [(B) shall use the competitive procedure or 
        combination of competitive procedures that is best 
        suited under the circumstances of the procurement.
  [(2) In determining the competitive procedure appropriate 
under the circumstances, the head of an agency--
          [(A) shall solicit sealed bids if--
                  [(i) time permits the solicitation, 
                submission, and evaluation of sealed bids;
                  [(ii) the award will be made on the basis of 
                price and other price-related factors;
                  [(iii) it is not necessary to conduct 
                discussions with the responding sources about 
                their bids; and
                  [(iv) there is a reasonable expectation of 
                receiving more than one sealed bid; and
          [(B) shall request competitive proposals if sealed 
        bids are not appropriate under clause (A).
  [(b)(1) The head of an agency may provide for the procurement 
of property or services covered by this chapter using 
competitive procedures but excluding a particular source in 
order to establish or maintain an alternative source or sources 
of supply for that property or service if the head of the 
agency determines that to do so--
          [(A) would increase or maintain competition and would 
        likely result in reduced overall costs for such 
        procurement, or for any anticipated procurement, of 
        property or services;
          [(B) would be in the interest of national defense in 
        having a facility (or a producer, manufacturer, or 
        other supplier) available for furnishing the property 
        or service in case of a national emergency or 
        industrial mobilization;
          [(C) would be in the interest of national defense in 
        establishing or maintaining an essential engineering, 
        research, or development capability to be provided by 
        an educational or other nonprofit institution or a 
        federally funded research and development center;
          [(D) would ensure the continuous availability of a 
        reliable source of supply of such property or service;
          [(E) would satisfy projected needs for such property 
        or service determined on the basis of a history of high 
        demand for the property or service; or
          [(F) in the case of medical supplies, safety 
        supplies, or emergency supplies, would satisfy a 
        critical need for such supplies.
  [(2) The head of an agency may provide for the procurement of 
property or services covered by this section using competitive 
procedures, but excluding concerns other than small business 
concerns in furtherance of sections 9 and 15 of the Small 
Business Act (15 U.S.C. 638, 644) and concerns other than small 
business concerns, historically Black colleges and 
universities, and minority institutions in furtherance of 
section 2323 of this title.
  [(3) A contract awarded pursuant to the competitive 
procedures referred to in paragraphs (1) and (2) shall not be 
subject to the justification and approval required by 
subsection (f)(1).
  [(4) A determination under paragraph (1) may not be made for 
a class of purchases or contracts.
  [(c) The head of an agency may use procedures other than 
competitive procedures only when--
          [(1) the property or services needed by the agency 
        are available from only one responsible source or only 
        from a limited number of responsible sources and no 
        other type of property or services will satisfy the 
        needs of the agency;
          [(2) the agency's need for the property or services 
        is of such an unusual and compelling urgency that the 
        United States would be seriously injured unless the 
        agency is permitted to limit the number of sources from 
        which it solicits bids or proposals;
          [(3) it is necessary to award the contract to a 
        particular source or sources in order (A) to maintain a 
        facility, producer, manufacturer, or other supplier 
        available for furnishing property or services in case 
        of a national emergency or to achieve industrial 
        mobilization, (B) to establish or maintain an essential 
        engineering, research, or development capability to be 
        provided by an educational or other nonprofit 
        institution or a federally funded research and 
        development center, or (C) to procure the services of 
        an expert for use, in any litigation or dispute 
        (including any reasonably foreseeable litigation or 
        dispute) involving the Federal Government, in any 
        trial, hearing, or proceeding before any court, 
        administrative tribunal, or agency, or in any part of 
        an alternative dispute resolution process, whether or 
        not the expert is expected to testify;
          [(4) the terms of an international agreement or a 
        treaty between the United States and a foreign 
        government or international organization, or the 
        written directions of a foreign government reimbursing 
        the agency for the cost of the procurement of the 
        property or services for such government, have the 
        effect of requiring the use of procedures other than 
        competitive procedures;
          [(5) subject to subsection (j), a statute expressly 
        authorizes or requires that the procurement be made 
        through another agency or from a specified source, or 
        the agency's need is for a brand-name commercial item 
        for authorized resale;
          [(6) the disclosure of the agency's needs would 
        compromise the national security unless the agency is 
        permitted to limit the number of sources from which it 
        solicits bids or proposals; or
          [(7) the head of the agency--
                  [(A) determines that it is necessary in the 
                public interest to use procedures other than 
                competitive procedures in the particular 
                procurement concerned, and
                  [(B) notifies the Congress in writing of such 
                determination not less than 30 days before the 
                award of the contract.
  [(d)(1) For the purposes of applying subsection (c)(1)--
          [(A) in the case of a contract for property or 
        services to be awarded on the basis of acceptance of an 
        unsolicited research proposal, the property or services 
        shall be considered to be available from only one 
        source if the source has submitted an unsolicited 
        research proposal that demonstrates a concept--
                  [(i) that is unique and innovative or, in the 
                case of a service, for which the source 
                demonstrates a unique capability of the source 
                to provide the service; and
                  [(ii) the substance of which is otherwise 
                available to the United States and does not 
                resemble the substance of a pending competitive 
                procurement; and
          [(B) in the case of a follow-on contract for the 
        continued development or production of a major system 
        or highly specialized equipment, or the continued 
        provision of highly specialized services, such property 
        or services may be deemed to be available only from the 
        original source and may be procured through procedures 
        other than competitive procedures when it is likely 
        that award to a source other than the original source 
        would result in--
                  [(i) substantial duplication of cost to the 
                United States which is not expected to be 
                recovered through competition; or
                  [(ii) unacceptable delays in fulfilling the 
                agency's needs.
  [(2) The authority of the head of an agency under subsection 
(c)(7) may not be delegated.
  [(e) The head of an agency using procedures other than 
competitive procedures to procure property or services by 
reason of the application of subsection (c)(2) or (c)(6) shall 
request offers from as many potential sources as is practicable 
under the circumstances.
  [(f)(1) Except as provided in paragraph (2), the head of an 
agency may not award a contract using procedures other than 
competitive procedures unless--
          [(A) the contracting officer for the contract 
        justifies the use of such procedures in writing and 
        certifies the accuracy and completeness of the 
        justification;
          [(B) the justification is approved--
                  [(i) in the case of a contract for an amount 
                exceeding $100,000 (but equal to or less than 
                $1,000,000), by the competition advocate for 
                the procuring activity (without further 
                delegation) or by an official referred to in 
                clause (ii), (iii), or (iv);
                  [(ii) in the case of a contract for an amount 
                exceeding $1,000,000 (but equal to or less than 
                $10,000,000), by the head of the procuring 
                activity (or the head of the procuring 
                activity's delegate designated pursuant to 
                paragraph (6)(A));
                  [(iii) in the case of a contract for an 
                amount exceeding $10,000,000 (but equal to or 
                less than $50,000,000), by the senior 
                procurement executive of the agency designated 
                pursuant to section 16(3) of the Office of 
                Federal Procurement Policy Act (41 U.S.C. 
                414(3)) or the senior procurement executive's 
                delegate designated pursuant to paragraph 
                (6)(B), or in the case of the Under Secretary 
                of Defense for Acquisition and Technology, 
                acting in his capacity as the senior 
                procurement executive for the Department of 
                Defense, the Under Secretary's delegate 
                designated pursuant to paragraph (6)(C);
                  [(iv) in the case of a contract for an amount 
                exceeding $50,000,000, by the senior 
                procurement executive of the agency designated 
                pursuant to section 16(3) of the Office of 
                Federal Procurement Policy Act (41 U.S.C. 
                414(3)) (without further delegation) or in the 
                case of the Under Secretary of Defense for 
                Acquisition and Technology, acting in his 
                capacity as the senior procurement executive 
                for the Department of Defense, the Under 
                Secretary's delegate designated pursuant to 
                paragraph (6)(C); and
          [(C) any required notice has been published with 
        respect to such contract pursuant to section 18 of the 
        Office of Federal Procurement Policy Act (41 U.S.C. 
        416) and all bids or proposals received in response to 
        that notice have been considered by the head of the 
        agency.
  [(2) In the case of a procurement permitted by subsection 
(c)(2), the justification and approval required by paragraph 
(1) may be made after the contract is awarded. The 
justification and approval required by paragraph (1) is not 
required--
          [(A) when a statute expressly requires that the 
        procurement be made from a specified source;
          [(B) when the agency's need is for a brand-name 
        commercial item for authorized resale;
          [(C) in the case of a procurement permitted by 
        subsection (c)(7);
          [(D) in the case of a procurement conducted under (i) 
        the Act of June 25, 1938 (41 U.S.C. 46 et seq.), 
        popularly referred to as the Wagner-O'Day Act, or (ii) 
        section 8(a) of the Small Business Act (15 U.S.C. 
        637(a)); or
          [(E) in the case of a procurement permitted by 
        subsection (c)(4), but only if the head of the 
        contracting activity prepares a document in connection 
        with such procurement that describes the terms of an 
        agreement or treaty, or the written directions, 
        referred to in that subsection that have the effect of 
        requiring the use of procedures other than competitive 
        procedures and such document is approved by the 
        competition advocate for the procuring activity.
  [(3) The justification required by paragraph (1)(A) shall 
include--
          [(A) a description of the agency's needs;
          [(B) an identification of the statutory exception 
        from the requirement to use competitive procedures and 
        a demonstration, based on the proposed contractor's 
        qualifications or the nature of the procurement, of the 
        reasons for using that exception;
          [(C) a determination that the anticipated cost will 
        be fair and reasonable;
          [(D) a description of the market survey conducted or 
        a statement of the reasons a market survey was not 
        conducted;
          [(E) a listing of the sources, if any, that expressed 
        in writing an interest in the procurement; and
          [(F) a statement of the actions, if any, the agency 
        may take to remove or overcome any barrier to 
        competition before a subsequent procurement for such 
        needs.
  [(4) The justification required by paragraph (1)(A) and any 
related information, and any document prepared pursuant to 
paragraph (2)(E), shall be made available for inspection by the 
public consistent with the provisions of section 552 of title 
5.
  [(5) In no case may the head of an agency--
          [(A) enter into a contract for property or services 
        using procedures other than competitive procedures on 
        the basis of the lack of advance planning or concerns 
        related to the amount of funds available to the agency 
        for procurement functions; or
          [(B) procure property or services from another agency 
        unless such other agency complies fully with the 
        requirements of this chapter in its procurement of such 
        property or services.
The restriction contained in clause (B) is in addition to, and 
not in lieu of, any other restriction provided by law.
  [(6)(A) The authority of the head of a procuring activity 
under paragraph (1)(B)(ii) may be delegated only to an officer 
or employee who--
          [(i) if a member of the armed forces, is a general or 
        flag officer; or
          [(ii) if a civilian, is serving in a position with a 
        grade under the General Schedule (or any other schedule 
        for civilian officers or employees) that is comparable 
        to or higher than the grade of brigadier general or 
        rear admiral (lower half).
  [(B) The authority of the senior procurement executive under 
paragraph (1)(B)(iii) may be delegated only to an officer or 
employee within the senior procurement executive's organization 
who--
          [(i) if a member of the armed forces, is a general or 
        flag officer; or
          [(ii) if a civilian, is serving in a position in 
        grade GS-16 or above (or in a comparable or higher 
        position under any other schedule for civilian officers 
        or employees).
  [(C) The authority of the Under Secretary of Defense for 
Acquisition and Technology under paragraph (1)(B)(iv) may be 
delegated only to--
          [(i) an Assistant Secretary of Defense; or
          [(ii) with respect to the element of the Department 
        of Defense (as specified in section 111(b) of this 
        title), other than a military department, carrying out 
        the procurement action concerned, an officer or 
        employee serving in or assigned or detailed to that 
        element who--
                  [(I) if a member of the armed forces, is 
                serving in a grade above brigadier general or 
                rear admiral (lower half); or
                  [(II) if a civilian, is serving in a position 
                with a grade under the General Schedule (or any 
                other schedule for civilian officers or 
                employees) that is comparable to or higher than 
                the grade of major general or rear admiral.
  [(g)(1) In order to promote efficiency and economy in 
contracting and to avoid unnecessary burdens for agencies and 
contractors, the Federal Acquisition Regulation shall provide 
for special simplified procedures for purchases of property and 
services for amounts not greater than the simplified 
acquisition threshold.
  [(2) A proposed purchase or contract for an amount above the 
simplified acquisition threshold may not be divided into 
several purchases or contracts for lesser amounts in order to 
use the simplified procedures required by paragraph (1).
  [(3) In using simplified procedures, the head of an agency 
shall promote competition to the maximum extent practicable.
  [(h) For the purposes of the following laws, purchases or 
contracts awarded after using procedures other than sealed-bid 
procedures shall be treated as if they were made with sealed-
bid procedures:
          [(1) The Act entitled ``An Act to provide conditions 
        for the purchase of supplies and the making of 
        contracts by the United States, and for other 
        purposes'', approved June 30, 1936 (commonly referred 
        to as the ``Walsh-Healey Act'') (41 U.S.C. 35-45).
          [(2) The Act entitled ``An Act relating to the rate 
        of wages for laborers and mechanics employed on public 
        buildings of the United States and the District of 
        Columbia by contractors and subcontractors, and for 
        other purposes'', approved March 3, 1931 (commonly 
        referred to as the ``Davis-Bacon Act'') (40 U.S.C. 
        276a-276a-5).
  [(i)(1) The Secretary of Defense shall prescribe by 
regulation the manner in which the Department of Defense 
negotiates prices for supplies to be obtained through the use 
of procedures other than competitive procedures, as defined in 
section 2302(2) of this title.
  [(2) The regulations required by paragraph (1) shall--
          [(A) specify the incurred overhead a contractor may 
        appropriately allocate to supplies referred to in that 
        paragraph; and
          [(B) require the contractor to identify those 
        supplies which it did not manufacture or to which it 
        did not contribute significant value.
  [(3) Such regulations shall not apply to an item of supply 
included in a contract or subcontract for which the price is 
based on established catalog or market prices of commercial 
items sold in substantial quantities to the general public.
  [(j)(1) It is the policy of Congress that an agency named in 
section 2303(a) of this title should not be required by 
legislation to award a new contract to a specific non-Federal 
Government entity. It is further the policy of Congress that 
any program, project, or technology identified in legislation 
be procured through merit-based selection procedures.
  [(2) A provision of law may not be construed as requiring a 
new contract to be awarded to a specified non-Federal 
Government entity unless that provision of law--
          [(A) specifically refers to this subsection;
          [(B) specifically identifies the particular non-
        Federal Government entity involved; and
          [(C) specifically states that the award to that 
        entity is required by such provision of law in 
        contravention of the policy set forth in paragraph (1).
  [(3) For purposes of this subsection, a contract is a new 
contract unless the work provided for in the contract is a 
continuation of the work performed by the specified entity 
under a preceding contract.
  [(4) This subsection shall not apply with respect to any 
contract that calls upon the National Academy of Sciences to 
investigate, examine, or experiment upon any subject of science 
or art of significance to an agency named in section 2303(a) of 
this title and to report on such matters to the Congress or any 
agency of the Federal Government.]
Sec. 2304. Contracts: competition requirements

  (a) Competition.--(1) Except as provided in subsections (b), 
(c), and (e) and except in the case of procurement procedures 
otherwise expressly authorized by statute, the head of an 
agency in conducting a procurement for property or services--
          (A) shall obtain full and open competition--
                  (i) that provides open access, and
                  (ii) that is consistent with the need to 
                efficiently fulfill the Government's 
                requirements,
        through the use of competitive procedures in accordance 
        with this chapter and the Federal Acquisition 
        Regulation; and
          (B) shall use the competitive procedure or 
        combination of competitive procedures that is best 
        suited under the circumstances of the procurement.
  (2) In determining the competitive procedure appropriate 
under the circumstances, the head of an agency--
          (A) shall solicit sealed bids if--
                  (i) time permits the solicitation, 
                submission, and evaluation of sealed bids;
                  (ii) the award will be made on the basis of 
                price and other price-related factors;
                  (iii) it is not necessary to conduct 
                discussions with the responding sources about 
                their bids; and
                  (iv) there is a reasonable expectation of 
                receiving more than one sealed bid; and
          (B) shall request competitive proposals if sealed 
        bids are not appropriate under clause (A).
  (b) Exclusion of Particular Source.--The head of an agency 
may provide for the procurement of property or services covered 
by this chapter using competitive procedures but excluding a 
particular source in order to establish or maintain an 
alternative source or sources of supply for that property or 
service. The Federal Acquisition Regulation shall set forth the 
circumstances under which a particular source may be excluded 
pursuant to this subsection.
  (c) Exclusion of Concerns Other Than Small Business Concerns 
and Certain Other Entities.--The head of an agency may provide 
for the procurement of property or services covered by this 
section using competitive procedures, but excluding concerns 
other than small business concerns in furtherance of sections 9 
and 15 of the Small Business Act (15 U.S.C. 638, 644) and 
concerns other than small business concerns, historically Black 
colleges and universities, and minority institutions in 
furtherance of section 2323 of this title.
  (d) Procedures Other Than Competitive Procedures.--(1) 
Procedures other than competitive procedures may be used for 
purchasing property and services only when the use of 
competitive procedures is not feasible or appropriate. 
Standards for determining when the use of competitive 
procedures is not feasible or appropriate shall be set forth in 
the Federal Acquisition Regulation. Each procurement using 
procedures other than competitive procedures (other than a 
procurement for commercial items using simplified procedures or 
a procurement in an amount not greater than the simplified 
acquisition threshold) shall be justified in writing and 
approved in accordance with the Federal Acquisition Regulation.
  (2) In the case of a procurement using procedures that 
preclude all but one source from responding (hereinafter in 
this subsection referred to as a ``sole source procurement''), 
the Federal Acquisition Regulation shall provide for 
justification and approval under paragraph (1) of such 
procurement under standards that set forth limited 
circumstances for such sole source procurements, including 
circumstances when--
          (A) the property or services needed by the agency are 
        available from only one responsible source and no other 
        type of property or services will satisfy the needs of 
        the agency;
          (B) the agency's need for the property or services is 
        of such an unusual and compelling urgency that the 
        United States would be seriously injured unless the 
        agency is permitted to award the contract for the 
        property or services to a particular source;
          (C) it is necessary to award the contract to a 
        particular source in order (i) to maintain a facility, 
        producer, manufacturer, or other supplier available for 
        furnishing property or services in case of a national 
        emergency or to achieve industrial mobilization, (ii) 
        to establish or maintain an essential engineering, 
        research, or development capability to be provided by 
        an educational or other nonprofit institution or a 
        federally funded research and development center, or 
        (iii) to procure the services of an expert for use, in 
        any litigation or dispute (including any reasonably 
        foreseeable litigation or dispute) involving the 
        Federal Government, in any trial, hearing, or 
        proceeding before any court, administrative tribunal, 
        or agency, or in any part of an alternative dispute 
        resolution process, whether or not the expert is 
        expected to testify;
          (D) the terms of an international agreement or a 
        treaty between the United States and a foreign 
        government or international organization, or the 
        written directions of a foreign government reimbursing 
        the agency for the cost of the procurement of the 
        property or services for such government, have the 
        effect of requiring the award of the contract for the 
        property or services to a particular source;
          (E) subject to section 2304f, a statute expressly 
        authorizes or requires that the procurement be made 
        through another agency or from a specified source, or 
        the agency's need is for a brand-name commercial item 
        for authorized resale;
          (F) the disclosure of the agency's needs would 
        compromise the national security unless the agency is 
        permitted to award the contract for the property or 
        services needed by the agency to a particular source; 
        or
          (G) the head of the agency--
                  (i) determines that it is necessary in the 
                public interest to award the contract for the 
                property or services needed by the agency to a 
                particular source in the particular procurement 
                concerned, and
                  (ii) notifies the Congress in writing of such 
                determination not less than 30 days before the 
                award of the contract.
  (3) The authority of the head of an agency under paragraph 
(2)(G) may not be delegated.
  (e) Simplified Procedures.--(1) In order to promote 
efficiency and economy in contracting and to avoid unnecessary 
burdens for agencies and contractors, the Federal Acquisition 
Regulation shall provide for special simplified procedures for 
purchases of commercial items and for purchases of property and 
services for amounts not greater than the simplified 
acquisition threshold.
  (2) A proposed purchase or contract for an amount above the 
simplified acquisition threshold may not be divided into 
several purchases or contracts for lesser amounts in order to 
use the simplified procedures required by paragraph (1).
  (3) In using simplified procedures, the head of an agency 
shall ensure that competition is obtained to the maximum extent 
practicable consistent with the particular Government 
requirement.
  (4) The Federal Acquisition Regulation shall provide that, in 
the case of a purchase of commercial items in an amount greater 
than the simplified acquisition threshold, the head of an 
agency--
          (A) may not conduct the purchase on a sole source 
        basis unless the need to do so is justified in writing 
        and approved in accordance with the Federal Acquisition 
        Regulation; and
          (B) shall include in the contract file a written 
        description of the procedures used in awarding the 
        contract and the number of offers received.
  (f) Certain Contracts.--For the purposes of the following 
laws, purchases or contracts awarded after using procedures 
other than sealed-bid procedures shall be treated as if they 
were made with sealed-bid procedures:
          (1) The Walsh-Healey Act (41 U.S.C. 35-45).
          (2) The Act entitled ``An Act relating to the rate of 
        wages for laborers and mechanics employed on public 
        buildings of the United States and the District of 
        Columbia by contractors and subcontractors, and for 
        other purposes'', approved March 3, 1931 (commonly 
        referred to as the ``Davis-Bacon Act'') (40 U.S.C. 
        276a--276a-5).
          * * * * * * *

Sec. 2304f. Merit-based selection

  [(j)(1)] (a) It is the policy of Congress that an agency 
named in section 2303(a) of this title should not be required 
by legislation to award a new contract to a specific non-
Federal Government entity. It is further the policy of Congress 
that any program, project, or technology identified in 
legislation be procured through merit-based selection 
procedures.
  [(2)] (b) A provision of law may not be construed as 
requiring a new contract to be awarded to a specified non-
Federal Government entity unless that provision of law--
          [(A)] (1) specifically refers to this [subsection] 
        section;
          [(B)] (2) specifically identifies the particular non-
        Federal Government entity involved; and
          [(C)] (3) specifically states that the award to that 
        entity is required by such provision of law in 
        contravention of the policy set forth in [paragraph 
        (1)] subsection (a).
  [(3)] (c) For purposes of this [subsection] section, a 
contract is a new contract unless the work provided for in the 
contract is a continuation of the work performed by the 
specified entity under a preceding contract.
  [(4)] (d) This [subsection] section shall not apply with 
respect to any contract that calls upon the National Academy of 
Sciences to investigate, examine, or experiment upon any 
subject of science or art of significance to an agency named in 
section 2303(a) of this title and to report on such matters to 
the Congress or any agency of the Federal Government.

Sec. 2305. Contracts: planning, solicitation, evaluation, and award 
                    procedures 

  (a)(1)[(A) In preparing for the procurement of property or 
services, the head of an agency shall--
          [(i) specify the agency's needs and solicit bids or 
        proposals in a manner designed to achieve full and open 
        competition for the procurement;
          [(ii) use advance procurement planning and market 
        research; and
          [(iii) develop specifications in such manner as is 
        necessary to obtain full and open competition with due 
        regard to the nature of the property or services to be 
        acquired.] (A) In preparing for the procurement of 
        property or services, the head of an agency shall use 
        advance procurement planning and market research.
  [(B) Each solicitation under this chapter shall include 
specifications which--
          [(i) consistent with the provisions of this chapter, 
        permit full and open competition; and
          [(ii) include restrictive provisions or conditions 
        only to the extent necessary to satisfy the needs of 
        the agency or as authorized by law.]
  [(C) For the purposes of subparagraphs (A) and (B), the] (B) 
Each solicitation under this chapter shall include 
specifications that include restrictive provisions or 
conditions only to the extent necessary to satisfy the needs of 
the agency or as authorized by law. The type of specification 
included in a solicitation shall depend on the nature of the 
needs of the agency and the market available to satisfy such 
needs. Subject to such needs, specifications may be stated in 
terms of--
          (i) * * *
          * * * * * * *
  (2) In addition to the specifications described in paragraph 
(1), a solicitation for sealed bids or competitive proposals 
(other than for a procurement for commercial items using 
simplified procedures or a purchase for an amount not greater 
than the simplified acquisition threshold) shall at a minimum 
include--
          (A) * * *
          * * * * * * *
  (b)(1) The head of an agency shall evaluate sealed bids and 
competitive proposals and make an award based solely on the 
factors specified in the solicitation.
          * * * * * * *
  (4)(A) The head of an agency shall evaluate competitive 
proposals in accordance with paragraph (1) and may award a 
contract--
          (i) after discussions with the offerors, provided 
        that written or oral discussions have been conducted 
        with [all] the responsible offerors who submit 
        proposals within the competitive range; or
          * * * * * * *
  (5)(A) When a contract is awarded by the head of an agency on 
the basis of competitive proposals, an unsuccessful offeror, 
upon written request received by the agency within 3 days after 
the date on which the unsuccessful offeror receives the 
notification of the contract award, shall be debriefed and 
furnished the basis for the selection decision and contract 
award. The head of the agency shall debrief the offeror within, 
to the maximum extent practicable, five days after receipt of 
the request by the agency.
          * * * * * * *
  [(F) The contracting officer shall include a summary of the 
debriefing in the contract file.]
  (6) (A) When the contracting officer excludes an offeror 
submitting a competitive proposal from the competitive range 
(or otherwise excludes such an offeror from further 
consideration prior to the final source selection decision), 
the excluded offeror may request in writing, within three days 
after the date on which the excluded offeror receives notice of 
its exclusion, a debriefing prior to award. The contracting 
officer shall make every effort to debrief the unsuccessful 
offeror as soon as practicable and may refuse the request for a 
debriefing if it is not in the best interests of the Government 
to conduct a debriefing at that time.
  (B) The contracting officer is required to debrief an 
excluded offeror in accordance with paragraph (5) of this 
section only if that offeror requested and was refused a 
preaward debriefing under subparagraph (A) of this paragraph.
  (C) The debriefing conducted under this subsection shall 
include--
          (i) the executive agency's evaluation of the 
        significant elements in the offeror's offer;
          (ii) a summary of the rationale for the offeror's 
        exclusion; and
          (iii) reasonable responses to relevant questions 
        posed by the debriefed offeror as to whether source 
        selection procedures set forth in the solicitation, 
        applicable regulations, and other applicable 
        authorities were followed by the executive agency.
  (D) The debriefing conducted pursuant to this subsection may 
not disclose the number or identity of other offerors and shall 
not disclose information about the content, ranking, or 
evaluation of other offerors' proposals.
  (7) The contracting officer shall include a summary of any 
debriefing conducted under paragraph (5) or (6) in the contract 
file.
  [(6)] (8) If the head of an agency considers that a bid or 
proposal evidences a violation of the antitrust laws, he shall 
refer the bid or proposal to the Attorney General for 
appropriate action.
          * * * * * * *
  (e) Protest File.--(1) If, in the case of a solicitation for 
a contract issued by, or an award or proposed award of a 
contract by, the head of an agency, a protest is filed pursuant 
to the procedures in [subchapter V of chapter 35 of title 31] 
title II of the Office of Federal Procurement Policy Act and an 
actual or prospective offeror so requests, a file of the 
protest shall be established by the procuring activity and 
reasonable access shall be provided to actual or prospective 
offerors.
  (2) Information exempt from disclosure under section 552 of 
title 5 may be redacted in a file established pursuant to 
paragraph (1) unless an applicable protective order provides 
otherwise.
  [(3) Regulations implementing this subsection shall be 
consistent with the regulations regarding the preparation and 
submission of an agency's protest file (the so-called ``rule 4 
file'') for protests to the General Services Board of Contract 
Appeals under section 111 of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 759).]
  (f) Agency Actions on Protests.--If, in connection with a 
protest, the head of an agency determines that a solicitation, 
proposed award, or award does not comply with the requirements 
of law or regulation, the head of the agency--
          (1) may take any action set out in [subparagraphs (A) 
        through (F) of subsection (b)(1) of section 3554 of 
        title 31] section 214(h)(2) of the Office of Federal 
        Procurement Policy Act; and
          (2) may pay costs described in [paragraph (1) of 
        section 3554(c) of title 31 within the limits referred 
        to in paragraph (2)] subparagraph (A) of section 
        214(i)(1) of the Office of Federal Procurement Policy 
        Act within the limits referred to in subparagraph (B) 
        of such section.

[Sec. 2306. Kinds of contracts]
Sec. 2306. Contract types
  (a) The cost-plus-a-percentage-of-cost system of contracting 
may not be used. Subject to the limitation in the preceding 
sentence, the other provisions of this section, and other 
applicable provisions of law, the head of an agency, in 
awarding contracts under this chapter after using procedures 
other than sealed-bid procedures, may enter into any kind of 
contract that he considers will promote the best interests of 
the United States, based on market conditions, established 
commercial practice (if any) for the product or service being 
acquired, and sound business judgment.
  [(b) Each contract awarded under this chapter after using 
procedures other than sealed-bid procedures shall contain a 
warranty, determined to be suitable by the head of the agency, 
that the contractor has employed or retained no person or 
selling agency to solicit or obtain the contract under an 
understanding or agreement for a commission, percentage, 
brokerage, or contingent fee, except a bona fide employee or 
established commercial or selling agency maintained by him to 
obtain business. If a contractor breaks such a warranty the 
United States may annul the contract without liability or may 
deduct the commission, percentage, brokerage, or contingent fee 
from the contract price or consideration. This subsection does 
not apply to a contract that is for an amount not greater than 
the simplified acquisition threshold or to a contract for the 
acquisition of commercial items.
  [(d) The fee for performing a cost-plus-a-fixed-fee contract 
for experimental, developmental, or research work may not be 
more than 15 percent of the estimated cost of the contract, not 
including the fee. The fee for performing a cost-plus-a-fixed-
fee contract for architectural or engineering services for a 
public work or utility plus the cost of those services to the 
contractor may not be more than 6 percent of the estimated cost 
of that work or project, not including fees. The fee for 
performing any other cost-plus-a-fixed-fee contract may not be 
more than 10 percent of the estimated cost of the contract, not 
including the fee. Determinations under this subsection of the 
estimated costs of a contract or project shall be made by the 
head of the agency at the time the contract is made.
  [(e) Each cost contract and each cost-plus-a-fixed-fee 
contract shall provide for notice to the agency by the 
contractor before the making, under the prime contract, of--
          [(1) a cost-plus-a-fixed-fee subcontract; or
          [(2) a fixed-price subcontract or purchase order 
        involving more than the greater of (A) the simplified 
        acquisition threshold, or (B) 5 percent of the 
        estimated cost of the prime contract.
  [(f) So-called ``truth-in-negotiations'' provisions relating 
to cost or pricing data to be submitted by certain contractors 
and subcontractors are provided in section 2306a of this 
title.]
  [(g)] (b)(1) The head of an agency may enter into contracts 
for periods of not more than five years for the following types 
of services (and items of supply related to such services) for 
which funds would otherwise be available for obligation only 
within the fiscal year for which appropriated--
          (A) operation, maintenance, and support of facilities 
        and installations;
          (B) maintenance or modification of aircraft, ships, 
        vehicles, and other highly complex military equipment;
          (C) specialized training necessitating high quality 
        instructor skills (for example, pilot and aircrew 
        members; foreign language training); and
          (D) base services (for example, ground maintenance; 
        in-plane refueling; bus transportation; refuse 
        collection and disposal);
whenever he finds that--
          (i) there will be a continuing requirement for the 
        services consonant with current plans for the proposed 
        contract period;
          (ii) the furnishing of such services will require a 
        substantial initial investment in plant or equipment, 
        or the incurrence of substantial contingent liabilities 
        for the assembly, training, or transportation of a 
        specialized work force; and
          (iii) the use of such a contract will promote the 
        best interests of the United States by encouraging 
        effective competition and promoting economies in 
        operation.
  (2) In entering into such contracts, the head of the agency 
shall be guided by the following principles:
          (A) The portion of the cost of any plant or equipment 
        amortized as a cost of contract performance should not 
        exceed the ratio between the period of contract 
        performance and the anticipated useful commercial life 
        of such plant or equipment. Useful commercial life, for 
        this purpose, means the commercial utility of the 
        facilities rather than the physical life thereof, with 
        due consideration given to such factors as location of 
        facilities, specialized nature thereof, and 
        obsolescence.
          (B) Consideration shall be given to the desirability 
        of obtaining an option to renew the contract for a 
        reasonable period not to exceed three years, at prices 
        not to include charges for plant, equipment and other 
        nonrecurring costs, already amortized.
          (C) Consideration shall be given to the desirability 
        of reserving in the agency the right, upon payment of 
        the unamortized portion of the cost of the plant or 
        equipment, to take title thereto under appropriate 
        circumstances.
  (3) In the event funds are not made available for the 
continuation of such a contract into a subsequent fiscal year, 
the contract shall be canceled or terminated, and the costs of 
cancellation or termination may be paid from--
          (A) appropriations originally available for the 
        performance of the contract concerned;
          (B) appropriations currently available for 
        procurement of the type of services concerned, and not 
        otherwise obligated; or
          (C) funds appropriated for those payments.
  [(h) Multiyear contracting authority is provided in section 
2306b of this title.]

Sec. 2306a. Cost or pricing data: truth in negotiations

  (a) * * *
  [(b) Exceptions.--
          [(1) In general.--Submission of cost or pricing data 
        shall not be required under subsection (a) in the case 
        of a contract, a subcontract, or modification of a 
        contract or subcontract--
                  [(A) for which the price agreed upon is based 
                on--
                          [(i) adequate price competition;
                          [(ii) established catalog or market 
                        prices of commercial items that are 
                        sold in substantial quantities to the 
                        general public; or
                          [(iii) prices set by law or 
                        regulation; or
                  [(B) in an exceptional case when the head of 
                the procuring activity, without delegation, 
                determines that the requirements of this 
                section may be waived and justifies in writing 
                the reasons for such determination.
          [(2) Modifications of contracts and subcontracts for 
        commercial items.--In the case of a modification of a 
        contract or subcontract for a commercial item that is 
        not covered by the prohibition on the submission of 
        cost or pricing data in paragraph (1)(A), submission of 
        cost or pricing data shall not be required under 
        subsection (a) if--
                  [(A) the contract or subcontract being 
                modified is a contract or subcontract for which 
                submission of cost or pricing data may not be 
                required by reason of paragraph (1)(A); and
                  [(B) the modification would not change the 
                contract or subcontract, as the case may be, 
                from a contract or subcontract for the 
                acquisition of a commercial item to a contract 
                or subcontract for the acquisition of an item 
                other than a commercial item.
          [(3) FAR standards.--The Federal Acquisition 
        Regulation shall provide clear standards for 
        determining whether the exceptions provided in 
        paragraph (1)(A) apply. In the case of the exception 
        provided in paragraph (1)(A)(i), the regulations shall 
        specify the criteria to be used to determine whether 
        adequate price competition exists. In the case of the 
        exception provided in paragraph (1)(A)(ii), the 
        regulations shall provide that the exception applies to 
        items that are sold in substantial quantities to the 
        general public, without regard to the quantity of items 
        that may be sold to the Federal Government.
  [(c) Restrictions on Additional Authority to Require Cost or 
Pricing Data or Other Information.--
          [(1) Authority to require cost or pricing data on 
        below-threshold contracts.--(A) Subject to subparagraph 
        (B), when cost or pricing data are not required to be 
        submitted by subsection (a) for a contract, 
        subcontract, or modification of a contract or 
        subcontract, such data may nevertheless be required to 
        be submitted by the head of the procuring activity, but 
        only if the head of the procuring activity determines 
        that such data are necessary for the evaluation by the 
        agency of the reasonableness of the price of the 
        contract, subcontract, or modification of a contract or 
        subcontract. In any case in which the head of the 
        procuring activity requires such data to be submitted 
        under this subsection, the head of the procuring 
        activity shall justify in writing the reason for such 
        requirement.
          [(B) The head of the procuring activity may not 
        require certified cost or pricing data to be submitted 
        under this paragraph for any contract or subcontract, 
        or modification of a contract or subcontract, covered 
        by the exceptions in subsection (b)(1)(A).
          [(C) The head of a procuring activity may not 
        delegate functions under this paragraph.
          [(2) Authority to require information other than 
        certified cost or pricing data.--When certified cost or 
        pricing data are not required to be submitted under 
        this section for a contract, subcontract, or 
        modification of a contract or subcontract, the head of 
        the procuring activity may require submission of data 
        other than certified cost or pricing data to the extent 
        necessary to determine the reasonableness of the price 
        of the contract, subcontract, or modification of the 
        contract or subcontract.
  [(d) Additional Exception Provisions Regarding Commercial 
Items.--
          [(1) Procurements based on adequate price 
        competition.--To the maximum extent practicable, the 
        head of an agency shall conduct procurements of 
        commercial items on a competitive basis. In any 
        procurement of a commercial item conducted on a 
        competitive basis and based upon adequate price 
        competition, the head of the agency conducting the 
        procurement shall not require cost or pricing data to 
        be submitted under subsection (a) for the contract, 
        subcontract, or modification of the contract or 
        subcontract under the procurement. If additional 
        information is necessary to determine the 
        reasonableness of the price of the contract, 
        subcontract, or modification, the head of the agency 
        shall, to the maximum extent practicable, obtain the 
        additional information from sources other than the 
        offeror.
          [(2) Procurements not based on adequate price 
        competition.--(A)(i) In any case in which it is not 
        practicable to conduct a procurement of a commercial 
        item covered by subsection (a) on a competitive basis, 
        and the procurement is not covered by an exception in 
        subsection (b), the contracting officer shall seek to 
        obtain from the offeror or contractor information 
        described in clause (ii). When such information is not 
        available from that source, the contracting officer 
        shall seek to obtain such information from another 
        source or sources.
          [(ii) The information referred in clause (i) is 
        information on prices at which the same item or similar 
        items have been sold in the commercial market that is 
        adequate for evaluating, through price analysis, the 
        reasonableness of the price of the contract, 
        subcontract, or modification of the contract or 
        subcontract under the procurement.
          [(B) The contracting officer shall exempt a contract, 
        subcontract, or modification of a contract or 
        subcontract under the procurement from the requirements 
        of subsection (a) if the contracting officer obtains 
        the information described in subparagraph (A)(ii) in 
        accordance with standards and procedures set forth in 
        the Federal Acquisition Regulation.
          [(C) A contracting officer may require submission of 
        cost or pricing data under subsection (a) only if the 
        contracting officer makes a written determination that 
        the agency is unable to obtain the information 
        described in subparagraph (A)(ii).
          [(3) Authority to audit.--(A) In accordance with 
        procedures prescribed in the Federal Acquisition 
        Regulation, the head of an agency is authorized to 
        examine all information provided by an offeror, 
        contractor, or subcontractor pursuant to paragraph 
        (2)(A) and all books and records of such offeror, 
        contractor, or subcontractor that directly relate to 
        such information in order to determine whether the 
        agency is receiving accurate information required under 
        this subsection.
          [(B) The right under subparagraph (A) shall expire 2 
        years after the date of award of the contract, or 2 
        years after the date of the modification of the 
        contract, with respect to which the information was 
        provided.
          [(4) Limitations on requests for data.--The Federal 
        Acquisition Regulation shall include reasonable 
        limitations on requests under this section for sales 
        data relating to commercial items.
          [(5) Form of information.--In requesting information 
        from an offeror under this subsection, a contracting 
        officer shall, to the maximum extent practicable, limit 
        the scope of the request to include only information 
        that is in the form regularly maintained by the offeror 
        in commercial operations.
          [(6) Confidentiality.--Any information received under 
        this subsection that is exempt from disclosure under 
        section 552(b) of title 5 shall not be disclosed by the 
        Federal Government.]
  (b) Exceptions.--
          (1) In general.--Submission of cost or pricing data 
        shall not be required under subsection (a) in the case 
        of a contract, a subcontract, or modification of a 
        contract or subcontract--
                  (A) for which the price agreed upon is based 
                on--
                          (i) adequate price competition; or
                          (ii) prices set by law or regulation;
                  (B) for the acquisition of a commercial item; 
                or
                  (C) in an exceptional case when the head of 
                the procuring activity, without delegation, 
                determines that the requirements of this 
                section may be waived and justifies in writing 
                the reasons for such determination.
          (2) Modifications of contracts and subcontracts for 
        commercial items.--In the case of a modification of a 
        contract or subcontract for a commercial item that is 
        not covered by the exception on the submission of cost 
        or pricing data in paragraph (1)(A) or (1)(B), 
        submission of cost or pricing data shall not be 
        required under subsection (a) if--
                  (A) the contract or subcontract being 
                modified is a contract or subcontract for which 
                submission of cost or pricing data may not be 
                required by reason of paragraph (1)(A) or 
                (1)(B); and
                  (B) the modification would not change the 
                contract or subcontract, as the case may be, 
                from a contract or subcontract for the 
                acquisition of a commercial item to a contract 
                or subcontract for the acquisition of an item 
                other than a commercial item.
  (c) Authority To Require Cost or Pricing Data on Below-
Threshold Contracts.--(1) Subject to paragraph (2), when 
certified cost or pricing data are not required to be submitted 
by subsection (a) for a contract, subcontract, or modification 
of a contract or subcontract, such data may nevertheless be 
required to be submitted by the head of the procuring activity, 
but only if the head of the procuring activity determines that 
such data are necessary for the evaluation by the agency of the 
reasonableness of the price of the contract, subcontract, or 
modification of a contract or subcontract. In any case in which 
the head of the procuring activity requires such data to be 
submitted under this subsection, the head of the procuring 
activity shall justify in writing the reason for such 
requirement.
  (2) The head of the procuring activity may not require 
certified cost or pricing data to be submitted under this 
paragraph for any contract or subcontract, or modification of a 
contract or subcontract, covered by the exceptions in 
subparagraph (A) or (B) of subsection (b)(1).
  (3) The head of a procuring activity may not delegate 
functions under this paragraph.
  (d) Limitations on Other Information.--The Federal 
Acquisition Regulation shall include the following:
          (1) Provisions concerning the types of information 
        that contracting officers may consider in determining 
        whether the price of a procurement to the Government is 
        fair and reasonable when certified cost or pricing data 
        are not required to be submitted under this section, 
        including appropriate information on the prices at 
        which the same item or similar items have previously 
        been sold that is adequate for evaluating the 
        reasonableness of the price of the proposed contract or 
        subcontract for the procurement.
          (2) Reasonable limitations on requests for sales data 
        relating to commercial items.
          (3) A requirement that a contracting officer shall, 
        to the maximum extent practicable, limit the scope of 
        any request for information relating to commercial 
        items from an offeror to only that information that is 
        in the form regularly maintained by the offeror in 
        commercial operations.
          (4) A statement that any information received 
        relating to commercial items that is exempt from 
        disclosure under section 552(b) of title 5 shall not be 
        disclosed by the Federal Government.
          * * * * * * *
  [(h) Required Regulations.--The Federal Acquisition 
Regulation shall contain provisions concerning the types of 
information that offerors must submit for a contracting officer 
to consider in determining whether the price of a procurement 
to the Government is fair and reasonable when certified cost or 
pricing data are not required to be submitted under this 
section because the price of the procurement to the United 
States is not expected to exceed the applicable threshold 
amount set forth in subsection (a) (as adjusted pursuant to 
paragraph (7) of such subsection). Such information, at a 
minimum, shall include appropriate information on the prices at 
which the same item or similar items have previously been sold 
that is adequate for evaluating the reasonableness of the price 
of the proposed contract or subcontract for the procurement.]
  [(i)] (h) Definitions.--In this section:
          (1) Cost or pricing data.--The term ``cost or pricing 
        data'' means all facts that, as of the date of 
        agreement on the price of a contract (or the price of a 
        contract modification), or, if applicable consistent 
        with subsection (e)(1)(B), another date agreed upon 
        between the parties, a prudent buyer or seller would 
        reasonably expect to affect price negotiations 
        significantly. Such term does not include information 
        that is judgmental, but does include the factual 
        information from which a judgment was derived.
          (2) Subcontract.--The term ``subcontract'' includes a 
        transfer of commercial items between divisions, 
        subsidiaries, or affiliates of a contractor or a 
        subcontractor.
          (3) Commercial item.--The term ``commercial item'' 
        has the meaning provided such term in section 4(12) of 
        the Office of Federal Procurement Policy Act.

Sec. 2306b. Multiyear contracts

  (a) In General.--To the extent that funds are otherwise 
available for obligation, the head of an agency [may] shall, to 
the maximum extent possible, enter into multiyear contracts for 
the purchase of property whenever the head of that agency 
finds--
          (1) * * *
          * * * * * * *
Sec. 2306c. Contractor share of gains and losses from cost, schedule, 
                    and performance experience

  The Federal Acquisition Regulation shall contain provisions 
to ensure that, for any cost-type contract or incentive-type 
contract, the contractor may be rewarded for contract 
performance exceeding the contract cost, schedule, or 
performance parameters to the benefit of the United States and 
may be penalized for failing to adhere to cost, schedule, or 
performance parameters to the detriment of the United States.
          * * * * * * *

[Sec. 2319. Encouragement of new competitors

  [(a) In this section, the term ``qualification requirement'' 
means a requirement for testing or other quality assurance 
demonstration that must be completed by an offeror before award 
of a contract.
  [(b) Except as provided in subsection (c), the head of the 
agency shall, before establishing a qualification requirement--
          [(1) prepare a written justification stating the 
        necessity for establishing the qualification 
        requirement and specify why the qualification 
        requirement must be demonstrated before contract award:
          [(2) specify in writing and make available to a 
        potential offeror upon request all requirements which a 
        prospective offeror, or its product, must satisfy in 
        order to become qualified, such requirements to be 
        limited to those least restrictive to meet the purposes 
        necessitating the establishment of the qualification 
        requirement;
          [(3) specify an estimate of the costs of testing and 
        evaluation likely to be incurred by a potential offeror 
        in order to become qualified;
          [(4) ensure that a potential offeror is provided, 
        upon request and on a reimbursable basis, a prompt 
        opportunity to demonstrate its ability to meet the 
        standards specified for qualification using qualified 
        personnel and facilities of the agency concerned or of 
        another agency obtained through interagency agreement, 
        or under contract, or other methods approved by the 
        agency (including use of approved testing and 
        evaluation services not provided under contract to the 
        agency);
          [(5) if testing and evaluation services are provided 
        under contract to the agency for the purposes of clause 
        (4), provide to the extent possible that such services 
        be provided by a contractor who is not expected to 
        benefit from an absence of additional qualified sources 
        and who shall be required in such contract to adhere to 
        any restriction on technical data asserted by the 
        potential offeror seeking qualification; and
          [(6) ensure that a potential offeror seeking 
        qualification is promptly informed as to whether 
        qualification is attained and, in the event 
        qualification is not attained, is promptly furnished 
        specific information why qualification was not 
        attained.
  [(c)(1) Subsection (b) of this section does not apply with 
respect to a qualification requirement established by statute 
or administrative action before October 19, 1984, unless such 
requirement is a qualified products list.
  [(2)(A) Except as provided in subparagraph (B), if it is 
unreasonable to specify the standards for qualification which a 
prospective offeror or its product must satisfy, a 
determination to that effect shall be submitted to the advocate 
for competition of the procuring activity responsible for the 
purchase of the item subject to the qualification requirement. 
After considering any comments of the advocate for competition 
reviewing such determination, the head of the purchasing office 
may waive the requirements of clauses (2) through (6) of 
subsection (b) for up to two years with respect to the item 
subject to the qualification requirement.
  [(B) The waiver authority provided in this paragraph does not 
apply with respect to a qualified products list.
  [(3) A potential offeror may not be denied the opportunity to 
submit and have considered an offer for a contract solely 
because the potential offer (A) is not on a qualified bidders 
list, qualified manufacturers list, or qualified products list, 
or (B) has not been identified as meeting a qualification 
requirement established after October 19, 1984, if the 
potential offeror can demonstrate to the satisfaction of the 
contracting officer that the potential offeror or its product 
meets the standards established for qualification or can meet 
such standards before the date specified for award of the 
contract.
  [(4) Nothing contained in this subsection requires the 
referral of an offer to the Small Business Administration 
pursuant to section 8(b)(7) of the Small Business Act (15 
U.S.C. 637(b)(7)), if the basis for the referral is a challenge 
by the offeror to either the validity of the qualification 
requirement or the offeror's compliance with such requirement.
  [(5) The head of an agency need not delay a proposed 
procurement in order to comply with subsection (b) or in order 
to provide a potential offeror with an opportunity to 
demonstrate its ability to meet the standards specified for 
qualification.
  [(6) The requirements of subsection (b) also apply before 
enforcement of any qualified products list, qualified 
manufacturers list, or qualified bidders list.
  [(d)(1) If the number of qualified sources or qualified 
products available to compete actively for an anticipated 
future requirement is fewer than two actual manufacturers or 
the products of two actual manufacturers, respectively, the 
head of the agency concerned shall--
          [(A) periodically publish notice in the Commerce 
        Business Daily soliciting additional sources or 
        products to seek qualification, unless the contracting 
        officer determines that such publication would 
        compromise national security; and
          [(B) bear the cost of conducting the specified 
        testing and evaluation (excluding the costs associated 
        with producing the item or establishing the production, 
        quality control, or other system to be tested and 
        evaluated) for a small business concern or a product 
        manufactured by a small business concern which has met 
        the standards specified for qualification and which 
        could reasonably be expected to compete for a contract 
        for that requirement, but such costs may be borne only 
        if the head of the agency determines that such 
        additional qualified sources or products are likely to 
        result in cost savings from increased competition for 
        future requirements sufficient to amortize the costs 
        incurred by the agency within a reasonable period of 
        time considering the duration and dollar value of 
        anticipated future requirements.
  [(2) The head of an agency shall require a prospective 
contractor requesting the United States to bear testing and 
evaluation costs under paragraph (1)(B) to certify as to its 
status as a small business concern under section 3 of the Small 
Business Act (15 U.S.C. 632).
  [(e) Within seven years after the establishment of a 
qualification requirement under subsection (b) or within seven 
years following an agency's enforcement of a qualified products 
list, qualified manufacturers list, or qualified bidders list, 
any such qualification requirement shall be examined and 
revalidated in accordance with the requirements of subsection 
(b). The preceding sentence does not apply in the case of a 
qualification requirement for which a waiver is in effect under 
subsection (c)(2).
  [(f) Except in an emergency as determined by the head of the 
agency, whenever the head of the agency determines not to 
enforce a qualification requirement for a solicitation, the 
agency may not thereafter enforce that qualification 
requirement unless the agency complies with the requirements of 
subsection (b).]
          * * * * * * *

Sec. 2323. Contract goal for small disadvantaged businesses and certain 
                    institutions of higher education

  (a) * * *
          * * * * * * *
  (e) Competitive Procedures and Advance Payments.--To attain 
the goal of subsection (a):
          (1) * * *
          * * * * * * *
          (3) To the extent practicable and when necessary to 
        facilitate achievement of the 5 percent goal described 
        in subsection (a), the head of an agency may enter into 
        contracts using [less than full and open] procedures 
        other than competitive procedures (including awards 
        under section 8(a) of the Small Business Act) and 
        partial set asides for entities described in subsection 
        (a)(1), but shall pay a price not exceeding fair market 
        cost by more than 10 percent in payment per contract to 
        contractors or subcontractors described in subsection 
        (a). The head of an agency shall adjust the percentage 
        specified in the preceding sentence for any industry 
        category if available information clearly indicates 
        that nondisadvantaged small business concerns in such 
        industry category are generally being denied a 
        reasonable opportunity to compete for contracts because 
        of the use of that percentage in the application of 
        this paragraph.
          * * * * * * *
  (i) Annual Report.--(1) * * *
          * * * * * * *
  (3) The report required under paragraph (1) shall also 
include the following:
          (A) The aggregate differential between the fair 
        market price of all contracts awarded pursuant to 
        subsection (e)(3) and the estimated fair market price 
        of all such contracts had such contracts been entered 
        into using [full and open] competitive procedures.
          * * * * * * *

[Sec. 2855. Law applicable to contracts for architectural and 
                    engineering services and construction design

  [(a) Contracts for architectural and engineering services and 
construction design in connection with a military construction 
project or a military family housing project shall be awarded 
in accordance with title IX of the Federal Property and 
Administrative Services Act of 1949 (40 U.S.C. 541 et seq.).]
Sec. 2332. Contracts for architectural and engineering services

  (a) The Secretary of Defense and the Secretaries of the 
military departments may enter into contracts for architectural 
and engineering services in connection with a military 
construction or family housing project or for other Department 
of Defense or military department purposes. Such contracts 
shall be awarded in accordance with the Brooks Architect-
Engineers Act (40 U.S.C. 541 et seq.).
  (b)(1) In the case of a contract referred to in subsection 
(a)--
          (A) if the Secretary concerned estimates that the 
        initial award of the contract will be in an amount 
        greater than or equal to the threshold amount 
        determined under paragraph (2), the contract may not be 
        set aside exclusively for award to small business 
        concerns; and
          (B) if the Secretary concerned estimates that the 
        initial award of the contract will be in an amount less 
        than the threshold amount determined under paragraph 
        (2), the contract shall be awarded in accordance with 
        the set aside provisions of the Small Business Act (15 
        U.S.C. 631 et seq.).
  (2) The initial threshold amount under paragraph (1) is 
$85,000. The Secretary of Defense may revise that amount in 
order to ensure that small business concerns receive a 
reasonable share of contracts referred to in subsection (a).
  (3) This subsection does not restrict the award of contracts 
to small business concerns under section 8(a) of the Small 
Business Act (15 U.S.C. 637(a)).
          * * * * * * *

              CHAPTER 140--PROCUREMENT OF COMMERCIAL ITEMS

          * * * * * * *

Sec. 2375. Relationship of commercial item provisions to other 
                    provisions of law

  (a) * * *
          * * * * * * *
  [(c) Cross Reference to Exception to Cost or Pricing Data 
Requirements for Commercial Items.--For provisions relating to 
exceptions for requirements for cost or pricing data for 
contracts for the procurement of commercial items, see section 
2306a(d) of this title.]
          * * * * * * *
           CHAPTER 141--MISCELLANEOUS PROCUREMENT PROVISIONS
Sec.
2381.  Contracts: regulations for bids.
     * * * * * * *
[2397.  Employees or former employees of defense contractors: reports.
[2397a.  Requirements relating to private employment contacts between 
          certain Department of Defense procurement officials and 
          defense contractors.
[2397b.  Certain former Department of Defense procurement officials: 
          limitations on employment by contractors.
[2397c.  Defense contractors: requirements concerning former Department 
          of Defense officials.]
     * * * * * * *
[2410.  Requests for equitable adjustment or other relief: 
          certification.]
2410.  Requests for equitable adjustment or other relief.
     * * * * * * *
[Sec. 2397. Employees or former employees of defense contractors: 
                    reports 

  [(a) In this section:
          [(1) The term ``contract'' means a contract 
        (including the net amount of modifications to, and the 
        exercise of options under, the contract) that is in an 
        amount in excess of the simplified acquisition 
        threshold, as in effect at the time that the contract 
        is awarded. The term does not include a contract for 
        the purchase of commercial items (as defined in section 
        4(12) of the Office of Federal Procurement Policy Act 
        (41 U.S.C. 403(12))).
          [(2) The term ``defense contractor'' means a person 
        that provides services, supplies, or both (including 
        construction) to the Department of Defense under a 
        contract directly with the Department.
          [(3) The term ``served'', when used with 
        ``otherwise'', includes the representation of a defense 
        contractor--
                  [(A) at a hearing, trial, appeal, or other 
                action in which the United States was a party 
                and that involved services, supplies, or both 
                (including construction) that were provided to, 
                or to be provided to, the Department by the 
                contractor; and
                  [(B) in a transaction with the Department 
                that involved services, supplies, or both 
                (including construction) that were provided to, 
                or to be provided to, the Department by the 
                contractor.
  [(b)(1) This subsection applies to--
          [(A) a former or retired officer of the Army, Navy, 
        Air Force, or Marine Corps who (i) has at least 10 
        years of active service, and (ii) held for any period 
        during that service a grade above captain or, if the 
        Navy, above lieutenant; and
          [(B) a former civilian official or employee 
        (including a consultant or part-time employee) of the 
        Department of Defense whose pay rate (at any time 
        during the three-year period before the end of the last 
        service of the person with the Department) was at least 
        equal to the minimum rate at the time for GS-13.
  [(2)(A) If a person to whom this subsection applies (i) was 
employed by, or served as a consultant or otherwise to, a 
defense contractor at any time during a year at an annual pay 
rate of at least $25,000 and the defense contractor was awarded 
contracts by the Department of Defense during the preceding 
year that totaled at least $10,000,000, and (ii) within the 
two-year period ending on the day before the person began the 
employment or consulting relationship, the person served on 
active duty or was a civilian employee for the Department, the 
person shall file a report with the Secretary of Defense in 
such manner and form as the Secretary may prescribe. The person 
shall file the report not later than 90-days after the date on 
which the person began the employment or consulting 
relationship.
  [(B) The person shall file an additional report each time, 
during the two-year period beginning on the date the active 
duty or civilian employment with the Department terminated, 
that the person's job with the defense contractor significantly 
changes or the person commences an employment or consulting 
relationship with another defense contractor under the 
conditions described in the first sentence. A person required 
to file an additional report under this subparagraph shall file 
the report within 30 days after the date of the change or the 
date the employment or consulting relationship commences, as 
the case may be.
  [(3) The report shall contain the following information:
          [(A) The name and address of the person reporting.
          [(B) The name and address of the defense contractor 
        that employed the person or for whom the person served 
        as a consultant or otherwise.
          [(C) The title of the position of the person when 
        serving the defense contractor.
          [(D) A description of the duties and work performed 
        or to be performed by the person for the defense 
        contractor, and a description of any similar duties or 
        work performed for which the person had at least 
        partial responsibility as a civilian official or 
        employee of the Department of Defense or a member of 
        the armed forces during the two-year period referred to 
        in paragraph (2)(A)(ii).
          [(E) The military grade of the person while on active 
        duty or the gross pay rate while performing civilian 
        service for the Department.
          [(F) A description of the duties and the work 
        performed by the person while on active duty or 
        performing civilian service for the Department during 
        the two-year period referred to in paragraph (2)(A)(ii) 
        and a description of the type of work performed and the 
        extent to which such work was performed by the person 
        for the defense contractor that has employed the person 
        or has retained the person as a consultant.
          [(G) The date the active duty or civilian service by 
        the person for the Department ended and the date the 
        service with the defense contractor began and, if 
        applicable, ended.
          [(H) Other pertinent information the Secretary 
        requires.
          [(I) A statement describing any disqualification 
        action taken by the person during the two-year period 
        referred to in paragraph (2)(A)(ii) with respect to any 
        involvement in a matter concerning the defense 
        contractor.
  [(c)(1) A person who (A) holds civilian office or employment 
(including employment as a consultant or part-time employee) in 
the Department at any time during a year at a pay rate at least 
equal to the minimum rate for GS-13, and (B) within the two-
year period before the effective date of employment with the 
Department was employed by, or served as a consultant or 
otherwise to, a defense contractor at any time during a year at 
an annual pay rate of at least $25,000 and the contractor was 
awarded contracts by the Department during that year that total 
at least $10,000,000, shall file a report with the Secretary in 
the way and at the time prescribed by the Secretary.
  [(2) The report shall contain the following information:
          [(A) The name and address of the person reporting.
          [(B) The title of the position of the person with the 
        Department.
          [(C) A description of the duties and work performed 
        by the person with the Department and a description of 
        any similar duties or work for which the person had at 
        least partial responsibility as an employee or 
        consultant of the defense contractor during the two-
        year period referred to in paragraph (1)(B).
          [(D) The name and address of the defense contractor 
        that employed the person or for whom the person served 
        as a consultant or otherwise.
          [(E) The title of the position of the person when 
        serving the defense contractor.
          [(F) A description of the duties and the work 
        performed by the person for the defense contractor and 
        a description of the type of work and the extent to 
        which such work was performed by the person in 
        connection with contracts of the defense contractor 
        with the Department during the two-year period referred 
        to in paragraph (1)(B).
          [(G) The date the service of the person with the 
        defense contractor ended and the date the service with 
        the Department began.
          [(H) Other pertinent information the Secretary 
        requires.
  [(d) The Secretary shall maintain a file containing the 
information filed under this section. The file may be inspected 
by members of the public at any time during regular work hours.
  [(e) Before April 1 of each year, the Secretary shall report 
to Congress the names of persons who have filed reports for the 
preceding year under this section. The names shall be listed, 
by groups, under the names of the appropriate defense 
contractors. The Secretary may include for each name 
appropriate additional information.
  [(f)(1) A person who fails to comply with the filing 
requirements of this section shall be liable to the United 
States for an administrative penalty in the amount of $10,000, 
or in such lesser amount as may be determined by the Secretary 
of Defense, considering all the relevant circumstances.
  [(2) The Secretary shall determine whether a person has 
failed to file a report required by this section and shall 
determine the amount of the penalty under paragraph (1). The 
Secretary shall make the determinations on the record after 
opportunity for an agency hearing as provided in subchapter II 
of chapter 5 of title 5. The determinations of the Secretary 
shall be subject to judicial review under chapter 7 of such 
title.

[Sec. 2397a. Requirements relating to private employment contacts 
                    between certain Department of Defense procurement 
                    officials and defense contractors

  [(a) In this section:
          [(1) The term ``contract'' has the same meaning as 
        provided in section 2397(a)(1) of this title.
          [(2) The term ``covered defense official'' means any 
        individual who is serving--
                  [(A) as a civilian officer or employee of the 
                Department of Defense in a position for which 
                the rate of pay is equal to or greater than the 
                minimum rate of pay payable for grade GS-11 
                under the General Schedule; or
                  [(B) on active duty in the armed forces in a 
                pay grade of O-4 or higher.
          [(3) The term ``defense contractor'' has the same 
        meaning as provided in section 2397(a)(2) of this 
        title.
          [(4) The term ``designated agency ethics official'' 
        has the same meaning as the term ``designated agency 
        official'' in section 109(3) of the Ethics in 
        Government Act of 1978 (92 Stat. 1850; 5 U.S.C. App.).
          [(5) The term ``employment'' means a relationship 
        under which an individual furnishes services in return 
        for any payment or other compensation paid directly or 
        indirectly to the individual for the services.
          [(6) The term ``procurement function'' includes, with 
        respect to a contract, any function relating to--
                  [(A) the negotiation, award, administration, 
                or approval of the contract;
                  [(B) the selection of a contractor;
                  [(C) the approval of changes in the contract;
                  [(D) quality assurance, operation and 
                developmental testing, the approval of payment, 
                or auditing under the contract; or
                  [(E) the management of the procurement 
                program.
  [(b)(1) If a covered defense official who has participated in 
the performance of a procurement function in connection with a 
contract awarded by the Department of Defense contacts, or is 
contacted by, the defense contractor to whom the contract was 
awarded (or an agent of such contractor) regarding future 
employment opportunities for the official with the defense 
contractor, the official (except as provided in paragraph (2)) 
shall--
          [(A) promptly report the contact to the official's 
        supervisor and to the designated agency ethics official 
        (or his designee) of the agency in which the covered 
        defense official is employed; and
          [(B) for any period for which future employment 
        opportunities for the covered defense official have not 
        been rejected by either the covered defense official or 
        the defense contractor, disqualify himself from all 
        participation in the performance of procurement 
        functions relating to contracts of the defense 
        contractor.
  [(2) A covered defense official is not required to report the 
first contact with a defense contractor under paragraph (1)(A) 
or to disqualify himself under paragraph (1)(B) if the defense 
official terminates the contact immediately. However, if an 
additional contact of the same or a similar nature is made by 
or with the defense contractor, the covered defense official 
shall report (as provided in paragraph (1)) the contact and all 
contacts of the same or a similar nature made by or with the 
defense contractor during the 90-day period ending on the date 
the additional contact is made.
  [(c) A report required by subsection (b)(1) shall include--
          [(1) the date of each contact covered by the report; 
        and
          [(2) a brief description of the substance of the 
        contact.
  [(d)(1)(A) If the Secretary of Defense determines under 
paragraph (2) that a person has failed promptly to make a 
report required by subsection (b)(1)(A) or (b)(2) or has failed 
to disqualify himself in any case in which he is required to do 
so under subsection (b)(1)(B)--
          [(i) the person may not accept or continue employment 
        with the defense contractor during the 10-year period 
        beginning with the date of separation from Government 
        service; and
          [(ii) the Secretary may impose on the person an 
        administrative penalty in the amount of $10,000, or in 
        such lesser amount as may be prescribed by the 
        Secretary, taking into consideration all the 
        circumstances.
  [(B) An individual who accepts or continues employment 
prohibited by subparagraph (A)(i) shall be liable to the United 
States for an administrative penalty as provided in 
subparagraph (A)(ii). Such penalty may be in addition to any 
penalty previously imposed on the individual under subparagraph 
(A)(ii) for failure promptly to make a report relating to the 
defense contractor by whom the individual is employed as 
required by subsection (b)(1)(A) or (b)(2).
  [(C) The Secretary of Defense may take action against an 
individual under this paragraph before, on, or after the date 
on which the individual's employment with the Government is 
terminated.
  [(2)(A) The Secretary of Defense shall determine--
          [(i) whether an individual has failed promptly to 
        make a report required by subsection (b)(1)(A) or 
        (b)(2) or has failed to disqualify himself in any case 
        in which he is required to do so under subsection 
        (b)(1)(B) and whether to impose a penalty under 
        paragraph (1)(A)(ii) and the amount of such penalty; 
        and
          [(ii) whether an individual is liable to the United 
        States for an administrative penalty under paragraph 
        (1)(B) and the amount of such penalty.
There shall be a rebuttable presumption in favor of a covered 
defense official that failure to report a contact with a 
defense contractor or failure to disqualify himself from 
participation in the performance of certain procurement 
functions is not a violation of subsection (b)(1)(A) or (b)(2) 
or subsection (b)(1)(B), as the case may be, if the defense 
official has received an opinion in writing from the designated 
agency ethics official under subsection (e) stating that a 
report or disqualification by the official was not necessary.
  [(B) Determinations of the Secretary under subparagraph (A) 
shall be made on the record after opportunity for an agency 
hearing as provided in subchapter II of chapter 5 of title 5. 
The determinations of the Secretary shall be subject to 
judicial review under chapter 7 of such title.
  [(e) If a designated agency ethics official or his designee 
receives a report required by subsection (b) or a request for 
advice from a covered defense official relating to a contact 
described in such subsection, the designated agency ethics 
official or his designee may issue a written opinion regarding 
the necessity of a covered defense official to file a report or 
disqualify himself from participation in certain procurement 
functions, as the case may be.
  [(f) A covered defense official should request the advice of 
his supervisor and the appropriate designated agency ethics 
official (or his designee) on matters to which this section 
applies.

[Sec. 2397b. Certain former Department of Defense procurement 
                    officials: limitations on employment by contractors

  [(a)(1) Subject to subsections (c) and (d), a person who is a 
former officer or employee of the Department of Defense or a 
former or retired member of the armed forces may not accept 
compensation from a contractor during the two-year period 
beginning on the date of such person's separation from service 
in the Department of Defense if--
          [(A) on a majority of the person's working days 
        during the two-year period ending on the date of such 
        person's separation from service in the Department of 
        Defense, the person performed a procurement function 
        (relating to a contract of the Department of Defense) 
        at a site or plant that is owned or operated by the 
        contractor and that was the principal location of such 
        person's performance of that procurement function;
          [(B) the person performed, on a majority of the 
        person's working days during such two-year period, 
        procurement functions relating to a major defense 
        system and, in the performance of such functions, 
        participated personally and substantially, and in a 
        manner involving decisionmaking responsibilities, with 
        respect to a contract for that system through contact 
        with the contractor; or
          [(C) during such two-year period the person acted as 
        one of the primary representatives of the United 
        States--
                  [(i) in the negotiation of a Department of 
                Defense contract in an amount in excess of 
                $10,000,000 with the contractor; or
                  [(ii) in the negotiation of a settlement of 
                an unresolved claim of the contractor in an 
                amount in excess of $10,000,000 under a 
                Department of Defense contract.
  [(2) In the application of paragraph (1) to a former officer 
or employee of the Department of Defense or a former or retired 
member of the armed forces, a person's status as a contractor 
shall be determined as of the date of the separation from 
service in the Department of Defense of the officer or employee 
or member or former member involved.
  [(b)(1) Any person who knowingly violates subsection (a)(1) 
shall be subject to a civil fine, in an amount not to exceed 
$250,000, in a civil action brought by the United States in the 
appropriate district court of the United States.
  [(2) Any person who knowingly offers or provides any 
compensation to another person, and who knew or should have 
known that the acceptance of such compensation is or would be 
in violation of subsection (a)(1), shall be subject to a civil 
fine, in an amount not to exceed $500,000, in a civil action 
brought by the United States in the appropriate district court 
of the United States.
  [(c) This section does not apply to any person with respect 
to--
          [(1) duties described in clause (A) or (B) of 
        subsection (a)(1) which were performed while such 
        person was serving--
                  [(A) in a civilian position for which the 
                rate of pay is less than the minimum rate of 
                pay payable for grade GS-13 of the General 
                Schedule; or
                  [(B) as a member of the armed forces in a pay 
                grade below pay grade O-4; or
          [(2) duties described in clause (C) of subsection 
        (a)(1) which were performed while such person was 
        serving--
                  [(A) in a civilian position for which the 
                rate of pay is less than the minimum rate of 
                pay payable for a Senior Executive Service 
                position; or
                  [(B) as a member of the armed forces in a pay 
                grade below pay grade O-7.
  [(d) This section does not prohibit any person from accepting 
compensation from any contractor that, during the fiscal year 
preceding the fiscal year in which such compensation is 
accepted, was not a Department of Defense contractor or was a 
contractor under Department of Defense contracts in a total 
amount less than $10,000,000.
  [(e)(1) Any person may, before accepting any compensation, 
request the appropriate designated agency ethics official to 
advise such person on the applicability of this section to the 
acceptance of such compensation. For purposes of the preceding 
sentence, the appropriate designated agency ethics official is 
the designated agency ethics official of the agency in which 
such person was serving at the time such person separated from 
service in the Department of Defense.
  [(2) A request for advice under paragraph (1) shall contain 
all information that is relevant to a determination by the 
designated agency ethics official on such request.
  [(3) Not later than 30 days after the date on which a 
designated agency ethics official receives a request for advice 
under paragraph (1), such official shall issue a written 
opinion on the applicability of this section to the acceptance 
of compensation covered by the request.
  [(4) If a designated agency ethics official, on the basis of 
a complete disclosure as required by paragraph (2), states in a 
written opinion furnished to any person under this subsection 
that this section is inapplicable to the acceptance of 
compensation by such person from a contractor in a particular 
case, there shall be a conclusive presumption in favor of such 
person, for the purposes of this section, that the person's 
acceptance of such compensation in such case is not a violation 
of subsection (a)(1).
  [(f) In this section:
          [(1) The term ``compensation'' includes any payment, 
        gift, benefit, reward, favor, or gratuity--
                  [(A) which is provided, directly or 
                indirectly, for services rendered by the person 
                accepting such payment, gift, benefit, reward, 
                favor, or gratuity; and
                  [(B) which is valued in excess of $250 at the 
                prevailing market price.
          [(2)(A) The term ``contractor'' means a person--
                  [(i) that contracts to supply the Department 
                of Defense with goods or services;
                  [(ii) that controls or is controlled by a 
                person described in clause (i); or
                  [(iii) that is under common control with a 
                person described in clause (i).
          [(B) Such term does not include--
                  [(i) an affiliate or subsidiary of a person 
                described in subparagraph (A) that is clearly 
                not engaged in the performance of a Department 
                of Defense contract;
                  [(ii) a State or local government; or
                  [(iii) any person who contracts to supply the 
                Department of Defense only commercial items (as 
                defined in section 4(12) of the Office of 
                Federal Procurement Policy Act (41 U.S.C. 
                403(12)))
          [(3) The term ``procurement function'' includes, with 
        respect to a contract, any function relating to--
                  [(A) the negotiation, award, administration, 
                or approval of the contract;
                  [(B) the selection of a contractor;
                  [(C) the approval of changes in the contract;
                  [(D) quality assurance, operational and 
                developmental testing, the approval of payment, 
                or auditing under the contract; or
                  [(E) the management of the procurement 
                program.
          [(4) The term ``armed forces'' does not include the 
        Coast Guard.
          [(5) The term ``major defense system'' has the 
        meaning given the term ``major system'' in section 
        2302(5) of this title.
  [(g) For the purposes of this section, a person who is a 
retired member or a former member of the armed forces shall be 
considered to have been separated from service in the 
Department of Defense upon the date of the person's discharge 
or release from active duty.

[Sec. 2397c. Defense contractors: requirements concerning former 
                    Department of Defense officials

  [(a)(1) Each contract for the procurement of goods or 
services in excess of $100,000 entered into by the Department 
of Defense shall include a provision under which the contractor 
agrees not to provide compensation to a person if the 
acceptance of such compensation by such person would violate 
section 2397b(a)(1) of this title.
  [(2) Such a contract shall also provide that if the 
contractor knowingly violates a contract provision required by 
paragraph (1) the contractor shall pay to the United States, as 
liquidated damages under the contract, an amount equal to the 
greater of--
          [(A) $100,000; or
          [(B) three times the amount of the compensation paid 
        by the contractor to the person in violation of such 
        contract provision.
  [(b)(1)(A) Any contractor that was awarded one or more 
contracts by the Department of Defense during the preceding 
fiscal year in an aggregate amount of at least $10,000,000 that 
is subject during a calendar year to a contract provision 
described in subsection (a) shall submit to the Secretary of 
Defense, not later than April 1 of the next year, a written 
report covering the preceding calendar year. Each such report 
shall list the name of each person (together with other 
information adequate for the Government to identify the person) 
who--
          [(i) is a former officer or employee of the 
        Department of Defense or a former or retired member of 
        the armed forces; and
          [(ii) during the preceding calendar year was provided 
        compensation by that contractor, if such compensation 
        was provided within two years after such officer, 
        employee, or member left service in the Department of 
        Defense.
  [(B) In the case of each person named in a report submitted 
under subparagraph (A), the report shall--
          [(i) identify the agency in which the person was 
        employed or served on active duty during the last two 
        years of the person's service with the Department of 
        Defense;
          [(ii) state the person's job title and identify each 
        major defense system, if any, on which the person 
        performed any work with the Department of Defense 
        during the last two years of the person's service with 
        the Department;
          [(iii) contain a complete description of any work 
        that the person is performing on behalf of the 
        contractor; and
          [(iv) identify each major defense system on which the 
        person has performed any work on behalf of the 
        contractor.
  [(2) A person who knowingly fails to file a report required 
by paragraph (1) shall be subject to an administrative penalty, 
not to exceed $10,000, imposed by the Secretary of Defense 
after an opportunity for an agency hearing on the record 
pursuant to regulations prescribed by the Secretary of Defense. 
The determinations of the Secretary shall be included in such 
record. The determinations of the Secretary shall be subject to 
judicial review under chapter 7 of title 5.
  [(3) The Secretary of Defense shall review each report under 
paragraph (1) for the purposes of (A) assessing the accuracy 
and completeness of the report, and (B) identifying possible 
violations of section 2397b(a)(1) of this title or of a 
contract provision required by subsection (a). The Secretary 
shall report any such possible violation to the Attorney 
General.
  [(4) The Secretary shall make reports submitted under this 
subsection available to any Member of Congress upon request.
  [(d) Subsection (g) of section 2397b of this title, and the 
definitions prescribed in subsection (f) of such section, apply 
to this section.
  [(e) This section does not apply to contracts for the 
purchase of commercial items (as defined in section 4(12) of 
the Office of Federal Procurement Policy Act (41 U.S.C. 
403(12))).]
          * * * * * * *

Sec. 2410. Requests for equitable adjustment or other relief[: 
                    certification]

  (a) [Certification] Requirement.--A request for equitable 
adjustment to contract terms or request for relief under Public 
Law 85-804 (50 U.S.C. 1431 et seq.) that exceeds the simplified 
acquisition threshold may not be paid [unless a person 
authorized to certify the request on behalf of the contractor 
certifies, at the time the request is submitted, that--] 
unless--
          (1) the request is made in good faith, and
          (2) the supporting data are accurate and complete [to 
        the best of that person's knowledge and belief].
          * * * * * * *

     CHAPTER 169--MILITARY CONSTRUCTION AND MILITARY FAMILY HOUSING

          * * * * * * *

 SUBCHAPTER III--ADMINISTRATION OF MILITARY CONSTRUCTION AND MILITARY 
                             FAMILY HOUSING
Sec.
2851.  Supervision of military construction projects.
     * * * * * * *
[2855.  Law applicable to contracts for architectural and engineering 
          services and construction design.]
     * * * * * * *
[Sec. 2855. Law applicable to contracts for architectural and 
                    engineering services and construction design

  [(a) Contracts for architectural and engineering services and 
construction design in connection with a military construction 
project or a military family housing project shall be awarded 
in accordance with title IX of the Federal Property and 
Administrative Services Act of 1949 (40 U.S.C. 541 et seq.).
  [(b)(1) In the case of a contract referred to in subsection 
(a)--
          [(A) if the Secretary concerned estimates that the 
        initial award of the contract will be in an amount 
        greater than or equal to the threshold amount 
        determined under paragraph (2), the contract may not be 
        set aside exclusively for award to small business 
        concerns; and
          [(B) if the Secretary concerned estimates that the 
        initial award of the contract will be in an amount less 
        than the threshold amount determined under paragraph 
        (2), the contract shall be awarded in accordance with 
        the set aside provisions of the Small Business Act (15 
        U.S.C. 631 et seq.).
  [(2) The initial threshold amount under paragraph (1) is 
$85,000. The Secretary of Defense may revise that amount in 
order to ensure that small business concerns receive a 
reasonable share of contracts referred to in subsection (a).
  [(3) This subsection does not restrict the award of contracts 
to small business concerns under section 8(a) of the Small 
Business Act (15 U.S.C. 637(a)).]
          * * * * * * *

                            Subtitle B--Army

          * * * * * * *

               PART IV--SERVICE, SUPPLY, AND PROCUREMENT

          * * * * * * *

                        CHAPTER 433--PROCUREMENT
Sec.
     * * * * * * *
[4540.  Architectural and engineering services.]
     * * * * * * *
[Sec. 4540. Architectural and engineering services

  [(a) Whenever he considers that it is advantageous to the 
national defense and that existing facilities of the Department 
of the Army are inadequate, the Secretary of the Army may, by 
contract or otherwise, employ the architectural or engineering 
services of any person outside that Department for producing 
and delivering designs, plans, drawings, and specifications 
needed for any public works or utilities project of the 
Department.
  [(b) The fee for any service under this section may not be 
more than 6 percent of the estimated cost, as determined by the 
Secretary, of the project to which it applies.
  [(c) Sections 305, 3324, and 7204, chapter 51, and 
subchapters III, IV, and VI of chapter 53 of title 5 do not 
apply to employment under this section.]
          * * * * * * *

                   Subtitle C--Navy and Marine Corps

          * * * * * * *

                    PART IV--GENERAL ADMINISTRATION

          * * * * * * *

  CHAPTER 631--SECRETARY OF THE NAVY: MISCELLANEOUS POWERS AND DUTIES
Sec.
     * * * * * * *
[7212.  Employment of outside architects and engineers.]
     * * * * * * *
[Sec. 7212. Employment of outside architects and engineers

  [(a) Whenever the Secretary of the Navy believes that the 
existing facilities of the Department of the Navy are 
inadequate and he considers it advantageous to national 
defense, he may employ, by contract or otherwise, without 
advertising and without reference to sections 305, 3324, and 
7204, chapter 51, and subchapters III, IV, and VI of chapter 53 
of title 5, architectural or engineering corporations, or 
firms, or individual architects or engineers, to produce 
designs, plans, drawings, and specifications for the 
accomplishment of any naval public works or utilities project 
or for the construction of any vessel or aircraft, or part 
thereof.
  [(b) The fee for any service under this section may not 
exceed 6 percent of the estimated cost, as determined by the 
Secretary, of the project to which the fee applies.]
          * * * * * * *

                         Subtitle D--Air Force

          * * * * * * *

               PART IV--SERVICE, SUPPLY, AND PROCUREMENT

          * * * * * * *

                        CHAPTER 933--PROCUREMENT
Sec.
     * * * * * * *
[9540.  Architectural and engineering services.]
     * * * * * * *
[Sec. 9540. Architectural and engineering services

  [(a) Whenever he considers that it is advantageous to the 
national defense and that existing facilities of the Department 
of the Air Force are inadequate, the Secretary of the Air Force 
may, by contract or otherwise, employ the architectural or 
engineering services of any person outside that Department for 
producing and delivering designs, plans, drawings, and 
specifications needed for any public works or utilities project 
of the Department.
  [(b) The fee for any service under this section may not be 
more than 6 percent of the estimated cost, as determined by the 
Secretary, of the project to which it applies.
  [(c) Sections 305, 3324, and 7204, chapter 51, and 
subchapters III, IV, and VI of chapter 53 of title 5 do not 
apply to employment under this section.]
          * * * * * * *
                              ----------                              

        FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Federal 
Property and Administrative Services Act of 1949''.
  (b) Table of Contents.--The table of contents for this Act is 
as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Declaration of policy.
     * * * * * * *

                    TITLE III--PROCUREMENT PROCEDURE

Sec. 301. Declaration of purpose.
     * * * * * * *
[Sec. 303. Competition requirements.]
Sec. 303. Contracts: competition requirements.
     * * * * * * *
[Sec. 303C. Encouragement of new competition.]
     * * * * * * *
Sec. 303M. Merit-based selection.
Sec. 304. Contract types.
     * * * * * * *
Sec. 304D. Contractor share of gains and losses from cost, schedule, and 
          performance experience.
     * * * * * * *
                         TITLE I--ORGANIZATION
          * * * * * * *

SEC. 111. AUTOMATIC DATA PROCESSING EQUIPMENT

  (a) * * *
          * * * * * * *
  [(f)(1) Upon request of an interested party in connection 
with any procurement that is subject to this section (including 
any such procurement that is subject to delegation of 
procurement authority), the board of contract appeals of the 
General Services Administration (hereafter in this subsection 
referred to as the ``board'') shall review, as provided in this 
subsection, any decision by a contracting officer that is 
alleged to violate a statute, a regulation, or the conditions 
of a delegation of procurement authority. Such review shall be 
conducted under the standard applicable to review of 
contracting officer final decisions by boards of contract 
appeals. The authority of the board to conduct such review 
shall include the authority to determine whether any 
procurement is subject to this section and the authority to 
review regulations to determine their consistency with 
applicable statutes. A proceeding, decision, or order of the 
board pursuant to this subsection shall not be subject to 
interlocutory appeal or review. An interested party who has 
filed a protest under subchapter V of chapter 35 of title 31, 
United States Code, with respect to a procurement or proposed 
procurement may not file a protest with respect to that 
procurement or proposed procurement under this subsection.
  [(2)(A) When a protest under this subsection is filed before 
the award of a contract in a protested procurement, the board, 
at the request of an interested party and within 10 days of the 
filing of the protest, shall hold a hearing to determine 
whether the board should suspend the procurement authority or 
the Administrator or the Administrator's delegation of 
procurement authority for the protested procurement on an 
interim basis until the board can decide the protest.
  [(B)(i) The board shall suspend the procurement authority of 
the Administrator or the Administrator's delegation of 
procurement authority unless the Federal agency concerned 
establishes that--
          [(I) absent action by the board, contract award is 
        likely to occur within 30 days of the hearing; and
          [(II) urgent and compelling circumstances which 
        significantly affect interests of the United States 
        will not permit waiting for the decision of the board.
  [(ii) A suspension under this subparagraph shall not preclude 
the Federal agency concerned from continuing the procurement 
process up to but not including award of the contract unless 
the board determines such action is not in the best interests 
of the United States.
  [(3)(A)(i) If, with respect to an award of a contract, the 
board receives notice of a protest under this subsection within 
the period described in clause (ii), the board shall, at the 
request of an interested party, hold a hearing to determine 
whether the board should suspend the procurement authority of 
the Administrator or the Administrator's delegation of 
procurement authority for the protested procurement on an 
interim basis until the board can decide the protest.
  [(ii) The period referred to in clause (i) is the period 
beginning on the date on which the contract is awarded and 
ending at the end of the later of--
          [(I) the tenth day after the date of contract award; 
        or
          [(II) the fifth day after the debriefing date offered 
        to an unsuccessful offeror for any debriefing that is 
        requested and, when requested, is required.
  [(iii) The board shall hold the requested hearing within 5 
days after the date of the filing of the protest or, in the 
case of a request for debriefing under the provisions of 
section 2305(b)(5) of title 10, United States Code, or section 
303B(e) of this Act, within 5 days after the later of the date 
of the filing of the protest or the date of the debriefing.
  [(B) The board shall suspend the procurement authority of the 
Administrator or the Administrator's delegation of procurement 
authority to acquire any goods or services under the contract 
which are not previously delivered and accepted unless the 
Federal agency concerned establishes that urgent and compelling 
circumstances which significantly affect interests of the 
United States will not permit waiting for the decision of the 
board.
  [(4)(A) The board shall conduct such proceedings and allow 
such discovery as may be required for the expeditious, fair, 
and reasonable resolution of the protest.
  [(B) Subject to any deadlines imposed by section 9(a) of the 
Contract Disputes Act of 1978 (41 U.S.C. 608(a)), the board 
shall give priority to protests filed under this subsection. 
The board shall issue its final decision within 65 days after 
the date of the filing of the protest, unless the board's 
chairman determines that the specific and unique circumstances 
of the protest require a longer period, in which case the board 
shall issue such decision within the longer period determined 
by the chairman. An amendment which adds a new ground of 
protest should be resolved, to the maximum extent practicable, 
within the time limits established for resolution of the 
initial protest.
  [(C) The board may dismiss a protest that the board 
determines--
          [(i) is frivolous;
          [(ii) has been brought or pursued in bad faith; or
          [(iii) does not state on its face a valid basis for 
        protest.
  [(5)(A) In making a decision on the merits of protests 
brought under this section, the board shall accord due weight 
to the policies of this section and the goals of economic and 
efficient procurement set forth in this section. The board may 
consider any decision, determination, opinion, or statement 
made by the Director of the Office of Management and Budget or 
any officer of any other Federal agency regarding applicability 
of this section to a particular procurement, and may request 
the advice of the Director or such officer with regard to such 
applicability, but shall not be bound by any such decision, 
determination, opinion, or statement when determining whether a 
procurement is subject to this section.
  [(B) If the board determines that a challenged agency action 
violates a statute or regulation or the conditions of any 
delegation of procurement authority issued pursuant to this 
section, the board may suspend, revoke, or revise the 
procurement authority of the Administrator or the 
Administrator's delegation of procurement authority applicable 
to the challenged procurement.
  [(C) Whenever the board makes such a determination, it may, 
in accordance with section 1304 of title 31, United States 
Code, further declare an appropriate prevailing party to be 
entitled to the cost of filing and pursuing the protest 
(including reasonable attorneys' fees and consultant and expert 
witness fees), and bid and proposal preparation. However, no 
party (other than a small business concern (within the meaning 
of section 3(a) of the Small Business Act)) may be declared 
entitled to costs for consultants and expert witness fees that 
exceed the highest rate of compensation for expert witnesses 
paid by the Federal Government, and no party (other than a 
small business concern (within the meaning of section 3(a) of 
the Small Business Act)) may be declared entitled to attorneys' 
fees that exceed $150 per hour unless the board, on a case by 
case basis, determines that an increase in the cost of living 
or a special factor, such as the limited availability of 
qualified attorneys for the proceedings involved, justifies a 
higher fee.
  [(D) Any agreement that provides for the dismissal of a 
protest and involves a direct or indirect expenditure of 
appropriated funds shall be submitted to the board and shall be 
made a part of the public record (subject to any protective 
order considered appropriate by the board) before dismissal of 
the protest. If a Federal agency is a party to a settlement 
agreement, the submission of the agreement to the board shall 
include a memorandum, signed by the contracting officer 
concerned, that describes in detail the procurement, the 
grounds for protest, the Federal Government's position 
regarding the grounds for protest, the terms of the settlement, 
and the agency's position regarding the propriety of the award 
or proposed award of the contract at issue in the protest.
  [(E) Payment of amounts due from an agency under subparagraph 
(C) or under the terms of a settlement agreement under 
subparagraph (D) shall be made from the appropriation made by 
section 1304 of title 31, United States Code, for the payment 
of judgments. The Federal agency concerned shall reimburse that 
appropriation account out of funds available for the 
procurement.
  [(6)(A) The final decision of the board may be appealed by 
the head of the Federal agency concerned and by any interested 
party, including interested parties who intervene in any 
protest filed under this subsection, as set forth in the 
Contract Disputes Act of 1978 (41 U.S.C. 601 et seq.).
  [(B) If the board revokes, suspends, or revises the 
procurement authority of the Administrator or the 
Administrator's delegation of procurement authority after the 
contract award, the affected contract shall be presumed valid 
as to all goods or services delivered and accepted under the 
contract before the suspension, revocation, or revision of such 
procurement authority or delegation.
  [(C) Nothing contained in this subsection shall affect the 
board's power to order any additional relief which it is 
authorized to provide under any statute or regulation. However, 
the procedures set forth in this subsection shall only apply to 
procurements conducted under the authority contained in this 
section. In addition, nothing contained in this subsection 
shall affect the right of any interested party to file a 
protest with the contracting agency or to file an action in a 
district court of the United States or the United States Claims 
Court.
  [(7)(A) The board shall adopt and issue such rules and 
procedures as may be necessary to the expeditious disposition 
of protests filed under the authority of this subsection.
  [(B) The procedures shall provide that, in the computation of 
any period described in this subsection--
          [(i) the day of the act, event, or default from which 
        the designated period of time begins to run not be 
        included; and
          [(ii) the last day after such act, event, or default 
        be included, unless--
                  [(I) such last day is a Saturday, a Sunday, 
                or a legal holiday; or
                  [(II) in the case of a filing of a paper at 
                the board, such last day is a day on which 
                weather or other conditions cause the closing 
                of the board in which event the next day that 
                is not a Saturday, Sunday, or legal holiday 
                shall be included.
  [(C) The procedures may provide for electronic filing and 
dissemination of documents and information required under this 
subsection and in so providing shall consider the ability of 
all parties to achieve electronic access to such documents and 
records.
  [(D) The procedures shall provide that if the board expressly 
finds that a protest or a portion of a protest is frivolous or 
has been brought or pursued in bad faith, or that any person 
has willfully abused the board's process during the course of a 
protest, the board may impose appropriate procedural sanctions, 
including dismissal of the protest.
  [(9) For purposes of this subsection:
          [(A) The term ``protest'' means a written objection 
        by an interested party to any of the following:
                  [(i) A solicitation or other request by a 
                Federal agency for offers for a contract for 
                the procurement of property or services.
                  [(ii) The cancellation of such a solicitation 
                or other request.
                  [(iii) An award or proposed award of such a 
                contract.
                  [(iv) A termination or cancellation of an 
                award of such a contract, if the written 
                objection contains an allegation that the 
                termination or cancellation is based in whole 
                or in part on improprieties concerning the 
                award of the contract.
          [(B) The term ``interested party'' means, with 
        respect to a contract or proposed contract described in 
        subparagraph (A), an actual or prospective bidder or 
        offeror whose direct economic interest would be 
        affected by the award of the contract or by failure to 
        award the contract.
          [(C) The term ``prevailing party'', with respect to a 
        determination of the board under paragraph (5)(B) that 
        a challenged action of a Federal agency violates a 
        statute or regulation or the conditions of a delegation 
        of procurement authority issued pursuant to this 
        section, means a party that demonstrated such 
        violation.]
          * * * * * * *

                    TITLE III--PROCUREMENT PROCEDURE

          * * * * * * *

[SEC. 303. COMPETITION REQUIREMENTS.

  [(a)(1) Except as provided in subsections (b), (c), and (g) 
and except in the case of procurement procedures otherwise 
expressly authorized by statute, an executive agency in 
conducting a procurement for property or services--
          [(A) shall obtain full and open competition through 
        the use of competitive procedures in accordance with 
        the requirements of this title and the Federal 
        Acquisition Regulation; and
          [(B) shall use the competitive procedure or 
        combination of competitive procedures that is best 
        suited under the circumstances of the procurement.
  [(2) In determining the competitive procedures appropriate 
under the circumstances, an executive agency--
          [(A) shall solicit sealed bids if--
                  [(i) time permits the solicitation, 
                submission, and evaluation of sealed bids;
                  [(ii) the award will be made on the basis of 
                price and other price-related factors;
                  [(iii) it is not necessary to conduct 
                discussions with the responding sources about 
                their bids; and
                  [(iv) there is a reasonable expectation of 
                receiving more than one sealed bid; and
          [(B) shall request competitive proposals if sealed 
        bids are not appropriate under clause (A).
  [(b)(1) An executive agency may provide for the procurement 
of property or services covered by this section using 
competitive procedures but excluding a particular source in 
order to establish or maintain any alternative source or 
sources of supply for that property or service if the agency 
head determines that to do so--
          [(A) would increase or maintain competition and would 
        likely result in reduced overall costs for such 
        procurement, or for any anticipated procurement, of 
        such property or services;
          [(B) would be in the interest of national defense in 
        having a facility (or a producer, manufacturer, or 
        other supplier) available for furnishing the property 
        or service in case of a national emergency or 
        industrial mobilization;
          [(C) would be in the interest of national defense in 
        establishing or maintaining an essential engineering, 
        research, or development capability to be provided by 
        an educational or other nonprofit institution or a 
        federally funded research and development center;
          [(D) would ensure the continuous availability of a 
        reliable source of supply of such property or service;
          [(E) would satisfy projected needs for such property 
        or service determined on the basis of a history of high 
        demand for the property or service; or
          [(F) in the case of medical supplies, safety 
        supplies, or emergency supplies, would satisfy a 
        critical need for such supplies.
  [(2) An executive agency may provide for the procurement of 
property or services covered by this section using competitive 
procedures, but excluding other than small business concerns in 
furtherance of sections 9 and 15 of the Small Business Act (15 
U.S.C. 639; 644).
  [(3) A contract awarded pursuant to the competitive 
procedures referred to in paragraphs (1) and (2) shall not be 
subject to the justification and approval required by 
subsection (f)(1).
  [(4) A determination under paragraph (1) may not be made for 
a class of purchases or contracts.
  [(c) An executive agency may use procedures other than 
competitive procedures only when--
          [(1) the property or services needed by the executive 
        agency are available from only one responsible source 
        and no other type of property or services will satisfy 
        the needs of the executive agency;
          [(2) the executive agency's need for the property or 
        services is of such an unusual and compelling urgency 
        that the Government would be seriously injured unless 
        the executive agency is permitted to limit the number 
        of sources from which it solicits bids or proposals;
          [(3) it is necessary to award the contract to a 
        particular source or sources in order (A) to maintain a 
        facility, producer, manufacturer, or other supplier 
        available for furnishing property or services in case 
        of a national emergency or to achieve industrial 
        mobilization, (B) to establish or maintain an essential 
        engineering, research, or development capability to be 
        provided by an educational or other nonprofit 
        institution or a federally funded research and 
        development center, or (C) to procure the services of 
        an expert for use, in any litigation or dispute 
        (including any reasonably foreseeable litigation or 
        dispute) involving the Federal Government, in any 
        trial, hearing, or proceeding before any court, 
        administrative tribunal, or agency, or in any part of 
        an alternative dispute resolution process, whether or 
        not the expert is expected to testify;
          [(4) the terms of an international agreement or 
        treaty between the United States Government and a 
        foreign government or international organization, or 
        the written directions of a foreign government 
        reimbursing the executive agency for the cost of the 
        procurement of the property or services for such 
        government, have the effect of requiring the use of 
        procedures other than competitive procedures;
          [(5) subject to subsection (h), a statute expressly 
        authorizes or requires that the procurement be made 
        through another executive agency or from a specified 
        source, or the agency's need is for a brand-name 
        commercial item for authorized resale;
          [(6) the disclosure of the executive agency's needs 
        would compromise the national security unless the 
        agency is permitted to limit the number of sources from 
        which it solicits bids or proposals; or
          [(7) the head of the executive agency--
                  [(A) determines that it is necessary in the 
                public interest to use procedures other than 
                competitive procedures in the particular 
                procurement concerned, and
                  [(B) notifies the Congress in writing of such 
                determination not less than 30 days before the 
                award of the contract.
  [(d)(1) For the purposes of applying subsection (c)(1)--
          [(A) in the case of a contract for property or 
        services to be awarded on the basis of acceptance of an 
        unsolicited research proposal, the property or services 
        shall be considered to be available from only one 
        source if the source has submitted an unsolicited 
        research proposal that demonstrates a unique and 
        innovative concept the substance of which is not 
        otherwise available to the United States and does not 
        resemble the substance of a pending competitive 
        procurement; and
          [(B) in the case of a follow-on contract for the 
        continued development or production of a major system 
        or highly specialized equipment when it is likely that 
        award to a source other than the original source would 
        result in (i) substantial duplication of cost to the 
        Government which is not expected to be recovered 
        through competition, or (ii) unacceptable delays in 
        fulfilling the executive agency's needs, such property 
        may be deemed to be available only from the original 
        source and may be procured through procedures other 
        than competitive procedures.
  [(2) The authority of the head of an executive agency under 
subsection (c)(7) may not be delegated.
  [(e) An executive agency using procedures other than 
competitive procedures to procure property or services by 
reason of the application of subsection (c)(2) or (c)(6) shall 
request offers from as many potential sources as is practicable 
under the circumstances.
  [(f)(1) Except as provided in paragraph (2), an executive 
agency may not award a contract using procedures other than 
competitive procedures unless--
          [(A) the contracting officer for the contract 
        justifies the use of such procedures in writing and 
        certifies the accuracy and completeness of the 
        justification;
          [(B) the justification is approved--
                  [(i) in the case of a contract for an amount 
                exceeding $100,000 (but equal to or less than 
                $1,000,000), by the competition advocate for 
                the procuring activity (without further 
                delegation) or by an official referred to in 
                clause (ii), (iii), or (iv);
                  [(ii) in the case of a contract for an amount 
                exceeding $1,000,000 (but equal to or less than 
                $10,000,000), by the head of the procuring 
                activity or a delegate who, if a member of the 
                armed forces, is a general or flag officer or, 
                if a civilian; is serving in a position in 
                grade GS-16 or above under the General Schedule 
                (or in a comparable or higher position under 
                another schedule); or
                  [(iii) in the case of a contract for an 
                amount exceeding $10,000,000, by the senior 
                procurement executive of the agency designated 
                pursuant to section 16(3) of the Office of 
                Federal Procurement Policy Act (41 U.S.C. 
                414(3)) (without further delegation); and
          [(C) any required notice has been published with 
        respect to such contract pursuant to section 18 of the 
        Office of Federal Procurement Policy Act and all bids 
        or proposals received in response to such notice have 
        been considered by such executive agency.
  [(2) In the case of a procurement permitted by subsection 
(c)(2), the justification and approval required by paragraph 
(1) may be made after the contract is awarded. The 
justification and approval required by paragraph (1) is not 
required--
          [(A) when a statute expressly requires that the 
        procurement be made from a specified source;
          [(B) when the agency's need is for a brand-name 
        commercial item for authorized resale;
          [(C) in the case of a procurement permitted by 
        subsection (c)(7); or
          [(D) in the case of a procurement conducted under (i) 
        the Act of June 25, 1938 (41 U.S.C. 46 et seq.), 
        popularly referred to as the Wagner-O'Day Act, or (ii) 
        section 8(a) of the Small Business Act (15 U.S.C. 
        637(a)).
  [(3) The justification required by paragraph (1)(A) shall 
include--
          [(A) a description of the agency's needs;
          [(B) an identification of the statutory exception 
        from the requirement to use competitive procedures and 
        a demonstration, based on the proposed contractor's 
        qualifications or the nature of the procurement, of the 
        reasons for using that exception;
          [(C) a determination that the anticipated cost will 
        be fair and reasonable;
          [(D) a description of the market survey conducted or 
        a statement of the reasons a market survey was not 
        conducted;
          [(E) a listing of the sources, if any, that expressed 
        in writing an interest in the procurement; and
          [(F) a statement of the actions, if any, the agency 
        may take to remove or overcome a barrier to competition 
        before a subsequent procurement for such needs.
  [(4) The justification required by paragraph (1)(A) and any 
related information shall be made available for inspection by 
the public consistent with the provisions of section 552 of 
title 5, United States Code.
  [(5) In no case may an executive agency--
          [(A) enter into a contract for property or services 
        using procedures other than competitive procedures on 
        the basis of the lack of advance planning or concerns 
        related to the amount of funds available to the agency 
        for procurement functions; or
          [(B) procure property or services from another 
        executive agency unless such other executive agency 
        complies fully with the requirements of this title in 
        its procurement of such property or services.
The restriction set out in clause (B) is in addition to, and 
not in lieu of any other restriction provided by law.
  [(g)(1) In order to promote efficiency and economy in 
contracting and to avoid unnecessary burdens for agencies and 
contractors, the Federal Acquisition Regulation shall provide 
for special simplified procedures for purchases of property and 
services for amounts not greater than the simplified 
acquisition threshold.
  [(2)(A) The Administrator of General Services shall prescribe 
regulations that provide special simplified procedures for 
acquisitions of leasehold interests in real property at rental 
rates that do not exceed the simplified acquisition threshold.
  [(B) For purposes of subparagraph (A), the rental rate or 
rates under a multiyear lease do not exceed the simplified 
acquisition threshold if the average annual amount of the rent 
payable for the period of the lease does not exceed the 
simplified acquisition threshold.
  [(3) A proposed purchase or contract for an amount above the 
simplified acquisition threshold may not be divided into 
several purchases or contracts for lesser amounts in order to 
use the simplified procedures required by paragraph (1).
  [(4) In using the simplified procedures, an executive agency 
shall promote competition to the maximum extent practicable.
  [(h)(1) It is the policy of Congress that an executive agency 
should not be required by legislation to award a new contract 
to a specific non-Federal Government entity. It is further the 
policy of Congress that any program, project, or technology 
identified in legislation be procured through merit-based 
selection procedures.
  [(2) A provision of law may not be construed as requiring a 
new contract to be awarded to a specified non-Federal 
Government entity unless that provision of law--
          [(A) specifically refers to this subsection;
          [(B) specifically identifies the particular non-
        Federal Government entity involved; and
          [(C) specifically states that the award to that 
        entity is required by such provision of law in 
        contravention of the policy set forth in paragraph (1).
  [(3) For purposes of this subsection, a contract is a new 
contract unless the work provided for in the contract is a 
continuation of the work performed by the specified entity 
under a preceding contract.
  [(4) This subsection shall not apply with respect to any 
contract that calls upon the National Academy of Sciences to 
investigate, examine, or experiment upon any subject of science 
or art of significance to an executive agency and to report on 
such matters to the Congress or any agency of the Federal 
Government.]
SEC. 303. CONTRACTS: COMPETITION REQUIREMENTS.

  (a) Competition.--(1) Except as provided in subsections (b), 
(c), and (e) and except in the case of procurement procedures 
otherwise expressly authorized by statute, an executive agency 
in conducting a procurement for property or services--
          (A) shall obtain full and open competition--
                  (i) that provides open access, and
                  (ii) that is consistent with the need to 
                efficiently fulfill the Government's 
                requirements,
        through the use of competitive procedures in accordance 
        with this chapter and the Federal Acquisition 
        Regulation; and
          (B) shall use the competitive procedure or 
        combination of competitive procedures that is best 
        suited under the circumstances of the procurement.
  (2) In determining the competitive procedure appropriate 
under the circumstances, an executive agency--
          (A) shall solicit sealed bids if--
                  (i) time permits the solicitation, 
                submission, and evaluation of sealed bids;
                  (ii) the award will be made on the basis of 
                price and other price-related factors;
                  (iii) it is not necessary to conduct 
                discussions with the responding sources about 
                their bids; and
                  (iv) there is a reasonable expectation of 
                receiving more than one sealed bid; and
          (B) shall request competitive proposals if sealed 
        bids are not appropriate under clause (A).
  (b) Exclusion of Particular Source.--An executive agency may 
provide for the procurement of property or services covered by 
this chapter using competitive procedures but excluding a 
particular source in order to establish or maintain an 
alternative source or sources of supply for that property or 
service. The Federal Acquisition Regulation shall set forth the 
circumstances under which a particular source may be excluded 
pursuant to this subsection.
  (c) Exclusion of Concerns Other than Small Business Concerns 
and Certain Other Entities.--An executive agency may provide 
for the procurement of property or services covered by this 
section using competitive procedures, but excluding concerns 
other than small business concerns in furtherance of sections 9 
and 15 of the Small Business Act (15 U.S.C. 638, 644) and 
concerns other than small business concerns, historically Black 
colleges and universities, and minority institutions in 
furtherance of section 7102 of the Federal Acquisition 
Streamlining Act of 1994 (15 U.S.C. 644 note).
  (d) Procedures Other Than Competitive Procedures.--(1) 
Procedures other than competitive procedures may be used for 
purchasing property and services only when the use of 
competitive procedures is not feasible or appropriate. 
Standards for determining when the use of competitive 
procedures is not feasible or appropriate shall be set forth in 
the Federal Acquisition Regulation. Each procurement using 
procedures other than competitive procedures (other than a 
procurement for commercial items using simplified procedures or 
a procurement in an amount not greater than the simplified 
acquisition threshold) shall be justified in writing and 
approved in accordance with the Federal Acquisition Regulation.
  (2) In the case of a procurement using procedures that 
preclude all but one source from responding (hereinafter in 
this subsection referred to as a ``sole source procurement''), 
the Federal Acquisition Regulation shall provide for 
justification and approval under paragraph (1) of such 
procurement under standards that set forth limited 
circumstances for such sole source procurements, including 
circumstances when--
          (A) the property or services needed by the executive 
        agency are available from only one responsible source 
        and no other type of property or services will satisfy 
        the needs of the executive agency;
          (B) the executive agency's need for the property or 
        services is of such an unusual and compelling urgency 
        that the United States would be seriously injured 
        unless the executive agency is permitted to award the 
        contract for the property or services to a particular 
        source;
          (C) it is necessary to award the contract to a 
        particular source in order (i) to maintain a facility, 
        producer, manufacturer, or other supplier available for 
        furnishing property or services in case of a national 
        emergency or to achieve industrial mobilization, (ii) 
        to establish or maintain an essential engineering, 
        research, or development capability to be provided by 
        an educational or other nonprofit institution or a 
        federally funded research and development center, or 
        (iii) to procure the services of an expert for use, in 
        any litigation or dispute (including any reasonably 
        foreseeable litigation or dispute) involving the 
        Federal Government, in any trial, hearing, or 
        proceeding before any court, administrative tribunal, 
        or agency, or in any part of an alternative dispute 
        resolution process, whether or not the expert is 
        expected to testify;
          (D) the terms of an international agreement or treaty 
        between the United States Government and a foreign 
        government or international organization, or the 
        written directions of a foreign government reimbursing 
        the executive agency for the cost of the procurement of 
        the property or services for such government, have the 
        effect of requiring the award of the contract for the 
        property or services to a particular source;
          (E) subject to section 303M, a statute expressly 
        authorizes or requires that the procurement be made 
        through another executive agency or from a specified 
        source, or the agency's need is for a brand-name 
        commercial item for authorized resale;
          (F) the disclosure of the executive agency's needs 
        would compromise the national security unless the 
        agency is permitted to award the contract for the 
        property or services needed by the agency to a 
        particular source; or
          (G) the head of the executive agency--
                  (i) determines that it is necessary in the 
                public interest to award the contract for the 
                property or services needed by the agency to a 
                particular source in the particular procurement 
                concerned, and
                  (ii) notifies the Congress in writing of such 
                determination not less than 30 days before the 
                award of the contract.
  (3) The authority of the head of an executive agency under 
paragraph (2)(G) may not be delegated.
  (e) Simplified Procedures.--(1) In order to promote 
efficiency and economy in contracting and to avoid unnecessary 
burdens for agencies and contractors, the Federal Acquisition 
Regulation shall provide for special simplified procedures for 
purchases of commercial items and for purchases of property and 
services for amounts not greater than the simplified 
acquisition threshold.
  (2)(A) The Administrator of General Services shall prescribe 
regulations that provide special simplified procedures for 
acquisitions of leasehold interests in real property at rental 
rates that do not exceed the simplified acquisition threshold.
  (B) For purposes of subparagraph (A), the rental rate or 
rates under a multiyear lease do not exceed the simplified 
acquisition threshold if the average annual amount of the rent 
payable for the period of the lease does not exceed the 
simplified acquisition threshold.
  (3) A proposed purchase or contract or for an amount above 
the simplified acquisition threshold may not be divided into 
several purchases or contracts for lesser amounts in order to 
use the simplified procedures required by paragraph (1).
  (4) In using simplified procedures, an executive agency shall 
ensure that competition is obtained to the maximum extent 
practicable consistent with the particular Government 
requirement.
  (5) The Federal Acquisition Regulation shall provide that, in 
the case of a purchase of commercial items in an amount greater 
than the simplified acquisition threshold, an executive agency 
may not conduct the purchase on a sole source basis unless the 
need to do so is justified in writing and approved in 
accordance with the Federal Acquisition Regulation.
SEC. 303A. PLANNING AND SOLICITATION REQUIREMENTS.

  (a)[(1) In preparing for the procurement of property or 
services, an executive agency shall--
          [(A) specify its needs and solicit bids or proposals 
        in a manner designed to achieve full and open 
        competition for the procurement;
          [(B) use advance procurement planning and market 
        research; and
          [(C) develop specifications in such manner as is 
        necessary to obtain full and open competition with due 
        regard to the nature of the property or services to be 
        acquired.] (1) In preparing for the procurement of 
        property or services, an executive agency shall use 
        advance procurement planning and market research.
  [(2) Each solicitation under this title shall include 
specifications which--
          [(A) consistent with the provisions of this title, 
        permit full and open competition;
          [(B) include restrictive provisions or conditions 
        only to the extent necessary to satisfy the needs of 
        the executive agency or as authorized by law.]
  [(3) For the purposes of paragraphs (1) and (2), the] (2) 
Each solicitation under this title shall include specifications 
that include restrictive provisions or conditions only to the 
extent necessary to satisfy the needs of the executive agency 
or as authorized by law. The type of specification included in 
a solicitation shall depend on the nature of the needs of the 
executive agency and the market available to satisfy such 
needs. Subject to such needs, specifications may be stated in 
terms of--
          (A) function, so that a variety of products or 
        services may qualify;
          (B) performance, including specifications of the 
        range of acceptable characteristics or of the minimum 
        acceptable standards; or
          (C) design requirements.
  (b) In addition to the specifications described in subsection 
(a), each solicitation for sealed bids or competitive proposals 
(other than for a procurement for commercial items using 
simplified procedures or a purchase for an amount not greater 
than the simplified acquisition threshold) shall at a minimum 
include--
          (1) * * *
          * * * * * * *

SEC. 303B. EVALUATION AND AWARD.

  (a) * * *
          * * * * * * *
  (d)(1) An executive agency shall evaluate competitive 
proposals in accordance with subsection (a) and may award a 
contract--
          (A) after discussions with the offerors, provided 
        that written or oral discussions have been conducted 
        with [all] the responsible offerors who submit 
        proposals within the competitive range; or
          * * * * * * *
  (e)(1) * * *
          * * * * * * *
  [(6) The contracting officer shall include a summary of the 
debriefing in the contract file.]
  (f)(1) When the contracting officer excludes an offeror 
submitting a competitive proposal from the competitive range 
(or otherwise excludes such an offeror from further 
consideration prior to the final source selection decision), 
the excluded offeror may request in writing, within 3 days 
after the date on which the excluded offeror receives notice of 
its exclusion, a debriefing prior to award. The contracting 
officer shall make every effort to debrief the unsuccessful 
offeror as soon as practicable and may refuse the request for a 
debriefing if it is not in the best interests of the Government 
to conduct a debriefing at that time.
  (2) The contracting officer is required to debrief an 
excluded offeror in accordance with subsection (e) of this 
section only if that offeror requested and was refused a 
preaward debriefing under paragraph (1) of this subsection.
  (3) The debriefing conducted under this subsection shall 
include--
          (A) the executive agency's evaluation of the 
        significant elements in the offeror's offer;
          (B) a summary of the rationale for the offeror's 
        exclusion; and
          (C) reasonable responses to relevant questions posed 
        by the debriefed offeror as to whether source selection 
        procedures set forth in the solicitation, applicable 
        regulations, and other applicable authorities were 
        followed by the executive agency.
  (4) The debriefing conducted pursuant to this subsection may 
not disclose the number or identity of other offerors and shall 
not disclose information about the content, ranking, or 
evaluation of other offerors' proposals.
  (g) The contracting officer shall include a summary of the 
any debriefing conducted under subsection (e) or (f) in the 
contract file.
  [(f)] (h) If the agency head considers that a bid or proposal 
evidences a violation of the antitrust laws, such agency head 
shall refer the bid or proposal to the Attorney General for 
appropriate action.
  [(g)] (i)(1)(A) In preparing a solicitation for the award of 
a development contract for a major system, the head of an 
agency shall consider requiring in the solicitation that an 
offeror include in its offer proposals described in 
subparagraph (B). In determining whether to require such 
proposals, the head of the agency shall give due consideration 
to the purposes for which the system is being procured and the 
technology necessary to meet the system's required 
capabilities. If such proposals are required, the head of the 
agency shall consider them in evaluating the offeror's price.
  (B) The proposals that the head of an agency is to consider 
requiring in a solicitation for the award of a development 
contract are the following:
          (i) Proposals to incorporate in the design of the 
        major system items which are currently available within 
        the supply system of the Federal agency responsible for 
        the major system, available elsewhere in the national 
        supply system, or commercially available from more than 
        one source.
          (ii) With respect to items that are likely to be 
        required in substantial quantities during the system's 
        service life, proposals to incorporate in the design of 
        the major system items which the United States will be 
        able to acquire competitively in the future.
  (2)(A) In preparing a solicitation for the award of a 
production contract for a major system, the head of an agency 
shall consider requiring in the solicitation that an offeror 
include in its offer proposals described in subparagraph (B). 
In determining whether to require such proposals, the head of 
the agency shall give due consideration to the purposes for 
which the system is being procured and the technology necessary 
to meet the system's required capabilities. If such proposals 
are required, the head of the agency shall consider them in 
evaluating the offeror's price.
  (B) The proposals that the head of an agency is to consider 
requiring in a solicitation for the award of a production 
contract are proposals identifying opportunities to ensure that 
the United States will be able to obtain on a competitive basis 
items procured in connection with the system that are likely to 
be reprocured in substantial quantities during the service life 
of the system. Proposals submitted in response to such 
requirement may include the following:
          (i) Proposals to provide to the United States the 
        right to use technical data to be provided under the 
        contract for competitive reprocurement of the item, 
        together with cost to the United States, if any, of 
        acquiring such technical data and the right to use such 
        data.
          (ii) Proposals for the qualification or development 
        of multiple sources of supply for the item.
  (3) If the head of an agency is making a noncompetitive award 
of a development contract or a production contract for a major 
system, the factors specified in paragraphs (1) and (2) to be 
considered in evaluating an offer for a contract may be 
considered as objectives in negotiating the contract to be 
awarded.
  [(h)] (j) Protest File.--(1) If, in the case of a 
solicitation for a contract issued by, or an award or proposed 
award of a contract by, the head of an executive agency, a 
protest is filed pursuant to the procedures in [subchapter V of 
chapter 35 of title 31, United States Code] title II of the 
Office of Federal Procurement Policy Act, and an actual or 
prospective offeror so requests, a file of the protest shall be 
established by the procuring activity and reasonable access 
shall be provided to actual or prospective offerors.
  (2) Information exempt from disclosure under section 552 of 
title 5, United States Code, may be redacted in a file 
established pursuant to paragraph (1) unless an applicable 
protective order provides otherwise.
  [(3) Regulations implementing this subsection shall be 
consistent with the regulations regarding the preparation and 
submission of an agency's protest file (the so-called ``rule 4 
file'') for protests to the General Services Board of Contract 
Appeals under section 111 of the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 759).]
  [(i)] (k) Agency Actions on Protests.--If, in connection with 
a protest, the head of an executive agency determines that a 
solicitation, proposed award, or award does not comply with the 
requirements of law or regulation, the head of such executive 
agency--
          (1) may take any action set out [in subparagraphs (A) 
        through (F) of subsection (b)(1) of section 3554 of 
        title 31, United States Code] section 214(h)(2) of the 
        Office of Federal Procurement Policy Act; and
          (2) may pay costs described in [paragraph (1) of 
        section 3554(c) of such title within the limits 
        referred to in paragraph (2)] subparagraph (A) of 
        section 214(i)(1) of the Office of Federal Procurement 
        Policy Act within the limits referred to in 
        subparagraph (B) of such section.

[SEC. 303C. ENCOURAGEMENT OF NEW COMPETITION.

  [(a) In this section, ``qualification requirement'' means a 
requirement for testing or other quality assurance 
demonstration that must be completed by an offeror before award 
of a contract.
  [(b) Except as provided in subsection (c), the head of the 
agency shall, before enforcing any qualification requirement--
          [(1) prepare a written justification stating the 
        necessity for establishing the qualification 
        requirement and specify why the qualification 
        requirement must be demonstrated before contract award;
          [(2) specify in writing and make available to a 
        potential offeror upon request all requirements which a 
        prospective offeror, or its product, must satisfy in 
        order to become qualified, such requirements to be 
        limited to those least restrictive to meet the purposes 
        necessitating the establishment of the qualification 
        requirement;
          [(3) specify an estimate of the costs of testing and 
        evaluation likely to be incurred by a potential offeror 
        in order to become qualified;
          [(4) ensure that a potential offeror is provided, 
        upon request, a prompt opportunity to demonstrate at 
        its own expense (except as provided in subsection (d)) 
        its ability to meet the standards specified for 
        qualification using qualified personnel and facilities 
        of the agency concerned or of another agency obtained 
        through interagency agreement, or under contract, or 
        other methods approved by the agency (including use of 
        approved testing and evaluation services not provided 
        under contract to the agency);
          [(5) if testing and evaluation services are provided 
        under contract to the agency for the purposes of clause 
        (4), provide to the extent possible that such services 
        be provided by a contractor who is not expected to 
        benefit from an absence of additional qualified sources 
        and who shall be required in such contract to adhere to 
        any restriction on technical data asserted by the 
        potential offeror seeking qualification; and
          [(6) ensure that a potential offeror seeking 
        qualification is promptly informed as to whether 
        qualification is attained and, in the event 
        qualification is not attained, is promptly furnished 
        specific information why qualification was not 
        attained.
  [(c)(1) Subsection (b) of this section does not apply with 
respect to a qualification requirement established by statute 
prior to the date of enactment of this section.
  [(2) Except as provided in paragraph (3), if it is 
unreasonable to specify the standards for qualification which a 
prospective offeror or its product must satisfy, a 
determination to that effect shall be submitted to the advocate 
for competition of the procuring activity responsible for the 
purchase of the item subject to the qualification requirement. 
After considering any comments of the advocate for competition 
reviewing such determination, the head of the procuring 
activity may waive the requirements of paragraphs (2) through 
(5) of subsection (b) for up to two years with respect to the 
item subject to the qualification requirement.
  [(3) The waiver authority contained in paragraph (2) shall 
not apply with respect to any qualified products list.
  [(4) A potential offeror may not be denied the opportunity to 
submit and have considered an offer for a contract solely 
because the potential offeror has not been identified as 
meeting a qualification requirement, if the potential offeror 
can demonstrate to the satisfaction of the contracting officer 
that the potential offeror or its product meets the standards 
established for qualification or can meet such standards before 
the date specified for award of the contract.
  [(5) Nothing contained in this subsection requires the 
referral of an offer to the Small Business Administration 
pursuant to section 8(b)(7) of the Small Business Act if the 
basis for the referral is a challenge by the offeror to either 
the validity of the qualification requirement or the offeror's 
compliance with such requirement.
  [(6) The head of an agency need not delay a proposed 
procurement in order to comply with subsection (b) or in order 
to provide a potential offeror with an opportunity to 
demonstrate its ability to meet the standards specified for 
qualification.
  [(d)(1) If the number of qualified sources or qualified 
products available to compete actively for an anticipated 
future requirement is fewer than two actual manufacturers or 
the products of two actual manufacturers, respectively, the 
head of the agency concerned shall--
          [(A) periodically publish notice in the Commerce 
        Business Daily soliciting additional sources or 
        products to seek qualification, unless the contracting 
        officer determines that such publication would 
        compromise national security; and
          [(B) bear the cost of conducting the specified 
        testing and evaluation (excluding the costs associated 
        with producing the item or establishing the production, 
        quality control, or other system to be tested and 
        evaluated) for a small business concern or a product 
        manufactured by a small business concern which has met 
        the standards specified for qualification and which 
        could reasonably be expected to compete for a contract 
        for that requirement, but such costs may be borne only 
        if the head of the agency determines that such 
        additional qualified sources or products are likely to 
        result in cost savings from increased competition for 
        future requirements sufficient to offset (within a 
        reasonable period of time considering the duration and 
        dollar value of anticipated future requirements) the 
        costs incurred by the agency.
  [(2) The head of an agency shall require a prospective 
contractor requesting the United States to bear testing and 
evaluation costs under paragraph (1)(B) to certify as to its 
status as a small business concern under section 3 of the Small 
Business Act.
  [(e) Within seven years after the establishment of a 
qualification requirement, the need for such qualification 
requirement shall be examined and the standards of such 
requirement revalidated in accordance with the requirements of 
subsection (b). The preceding sentence does not apply in the 
case of a qualification requirement for which a waiver is in 
effect under subsection (c)(2).
  [(f) Except in an emergency as determined by the head of the 
agency, whenever the head of the agency determines not to 
enforce a qualification requirement for a solicitation, the 
agency may not thereafter enforce that qualification 
requirement unless the agency complies with the requirements of 
subsection (b).]
          * * * * * * *
SEC. 303M. MERIT-BASED SELECTION.
  [(h)(1)] (a) It is the policy of Congress that an executive 
agency should not be required by legislation to award a new 
contract to a specific non-Federal Government entity. It is 
further the policy of Congress that any program, project, or 
technology identified in legislation be procured through merit-
based selection procedures.
  [(2)] (b) A provision of law may not be construed as 
requiring a new contract to be awarded to a specified non-
Federal Government entity unless that provision of law--
          [(A)] (1) specifically refers to this [subsection] 
        section;
          [(B)] (2) specifically identifies the particular non-
        Federal Government entity involved; and
          [(C)] (3) specifically states that the award to that 
        entity is required by such provision of law in 
        contravention of the policy set forth in [paragraph 
        (1)] subsection (a).
  [(3)] (c) For purposes of this [subsection] section, a 
contract is a new contract unless the work provided for in the 
contract is a continuation of the work performed by the 
specified entity under a preceding contract.
  [(4)] (d) This [subsection] section shall not apply with 
respect to any contract that calls upon the National Academy of 
Sciences to investigate, examine, or experiment upon any 
subject of science or art of significance to an executive 
agency and to report on such matters to the Congress or any 
agency of the Federal Government.

[SEC. 304. CONTRACT REQUIREMENTS.]
SEC. 304. CONTRACT TYPES.
  (a) Except as provided in subsection (b) of this section, 
contracts awarded after using procedures other than sealed-bid 
procedures may be of any type which in the opinion of the 
agency head will promote the best interests of the Government, 
based on market conditions, established commercial practice (if 
any) for the product or service being acquired, and sound 
business judgment. [Every contract awarded after using 
procedures other than sealed-bid procedures shall contain a 
suitable warranty, as determined by the agency head, by the 
contractor that no person or selling agency has been employed 
or retained to solicit or secure such contract upon an 
agreement or understanding for a commission, percentage, 
brokerage, or contingent fee, excepting bona fide employees or 
bona fide established commercial or selling agencies maintained 
by the contractor for the purpose of securing business, for the 
breach or violation of which warranty the Government shall have 
the right to annul such contract without liability or in its 
discretion to deduct from the contract price or consideration 
the full amount of such commission, percentage, brokerage, or 
contingent fee. The preceding sentence does not apply to a 
contract for an amount that is not greater than the simplified 
acquisition threshold or to a contract for the acquisition of 
commercial items.]
  (b) The cost-plus-a-percentage-of-cost system of contracting 
shall not be [used, and in the case of a cost-plus-a-fixed-fee 
contract the fee shall not exceed 10 percent of the estimated 
cost of the contract, exclusive of the fee, as determined by 
the agency head at the time of entering into such contract 
(except that a fee not in excess of 15 percent of such 
estimated cost is authorized in any such contract for 
experimental, developmental, or research work and that a fee 
inclusive of the contractor's costs and not in excess of 6 
percent of the estimated cost, exclusive of fees, as determined 
by the agency head at the time of entering into the contract, 
of the project to which such fee is applicable is authorized in 
contracts for architectural or engineering services relating to 
any public works or utility project). All cost and cost-plus-a-
fixed-fee contracts shall provide for advance notification by 
the contractor to the procuring agency of any subcontract 
thereunder on a cost-plus-a-fixed-fee basis and of any fixed-
price subcontract or purchase order which exceeds in dollar 
amount either the simplified acquisition threshold or 5 percent 
of the total estimated cost of the prime contract; and a 
procuring agency, through any authorized representative 
thereof, shall have the right to inspect the plans and to audit 
the books and records of any prime contractor or subcontractor 
engaged in the performance of a cost or cost-plus-a-fixed-fee 
contract.] used.

SEC. 304A. COST OR PRICING DATA: TRUTH IN NEGOTIATIONS.

  (a) * * *
  [(b) Exceptions.--
          [(1) In general.--Submission of cost or pricing data 
        shall not be required under subsection (a) in the case 
        of a contract, a subcontract, or a modification of a 
        contract or subcontract--
                  [(A) for which the price agreed upon is based 
                on--
                          [(i) adequate price competition;
                          [(ii) established catalog or market 
                        prices of commercial items that are 
                        sold in substantial quantities to the 
                        general public; or
                          [(iii) prices set by law or 
                        regulation; or
                  [(B) in an exceptional case when the head of 
                the procuring activity, without delegation, 
                determines that the requirements of this 
                section may be waived and justifies in writing 
                the reasons for such determination.
          [(2) Modifications of contracts and subcontracts for 
        commercial items.--In the case of a modification of a 
        contract or subcontract for a commercial item that is 
        not covered by the prohibition on the submission of 
        cost or pricing data in paragraph (1)(A), submission of 
        cost or pricing data shall not be required under 
        subsection (a) if--
                  [(A) the contract or subcontract being 
                modified is a contract or subcontract for which 
                submission of cost or pricing data may not be 
                required by reason of paragraph (1)(A); and
                  [(B) the modification would not change the 
                contract or subcontract, as the case may be, 
                from a contract or subcontract for the 
                acquisition of a commercial item to a contract 
                or subcontract for the acquisition of an item 
                other than a commercial item.
          [(3) FAR standards.--The Federal Acquisition 
        Regulation shall provide clear standards for 
        determining whether the exceptions provided in 
        paragraph (1)(A) apply. In the case of the exception 
        provided in paragraph (1)(A)(i), the regulations shall 
        specify the criteria to be used to determine whether 
        adequate price competition exists. In the case of the 
        exception provided in paragraph (1)(A)(ii), the 
        regulations shall provide that the exception applies to 
        items that are sold in substantial quantities to the 
        general public, without regard to the quantity of items 
        that may be sold to the Federal Government.
  [(c) Restrictions on Additional Authority To Require Cost or 
Pricing Data or Other Information.--
          [(1) Authority To Require Cost or Pricing Data on 
        Below-Threshold Contracts.--(A) Subject to subparagraph 
        (B), when cost or pricing data are not required to be 
        submitted by subsection (a) for a contract, 
        subcontract, or modification of a contract or 
        subcontract, such data may nevertheless be required to 
        be submitted by the head of the procuring activity, but 
        only if the head of the procuring activity determines 
        that such data are necessary for the evaluation by the 
        agency of the reasonableness of the price of the 
        contract, subcontract, or modification of a contract or 
        subcontract. In any case in which the head of the 
        procuring activity requires such data to be submitted 
        under this subsection, the head of the procuring 
        activity shall justify in writing the reason for such 
        requirement.
          [(B) The head of the procuring activity may not 
        require certified cost or pricing data to be submitted 
        under this paragraph for any contract or subcontract, 
        or modification of a contract or subcontract, covered 
        by the exceptions in subsection (b)(1)(A).
          [(C) The head of a procuring activity may not 
        delegate the functions under this paragraph.
          [(2) Authority to require information other than 
        certified cost or pricing data.--When certified cost or 
        pricing data are not required to be submitted under 
        this section for a contract, subcontract, or 
        modification of a contract or subcontract, the head of 
        the procuring activity may require submission of data 
        other than certified cost or pricing data to the extent 
        necessary to determine the reasonableness of the price 
        of the contract, subcontract, or modification of the 
        contract or subcontract.
  [(d) Additional Exception Provisions Regarding Commercial 
Items.--
          [(1) Procurements based on adequate price 
        competition.--To the maximum extent practicable, the 
        head of an executive agency shall conduct procurements 
        of commercial items on a competitive basis. In any 
        procurement of a commercial item conducted on a 
        competitive basis and based upon adequate price 
        competition, the head of the executive agency 
        conducting the procurement shall not require cost or 
        pricing data to be submitted under subsection (a) for 
        the contract, subcontract, or modification of the 
        contract or subcontract under the procurement. If 
        additional information is necessary to determine the 
        reasonableness of the price of the contract, 
        subcontract, or modification of the contract or 
        subcontract, the head of the executive agency shall, to 
        the maximum extent practicable, obtain the additional 
        information from sources other than the offeror.
          [(2) Procurements not based on adequate price 
        competition.--(A)(i) In any case in which it is not 
        practicable to conduct a procurement of a commercial 
        item covered by subsection (a) on a competitive basis, 
        and the procurement is not covered by an exception in 
        subsection (b), the contracting officer shall seek to 
        obtain from the offeror or contractor information 
        described in clause (ii). When such information is not 
        available from that source, the contracting officer 
        shall seek to obtain such information from another 
        source or sources.
          [(ii) The information referred in clause (i) is 
        information on prices at which the same item or similar 
        items have been sold in the commercial market that is 
        adequate for evaluating, through price analysis, the 
        reasonableness of the price of the contract, 
        subcontract, or modification of the contract or 
        subcontract under the procurement.
          [(B) The contracting officer shall exempt a contract, 
        subcontract, or modification of a contract or 
        subcontract under the procurement from the requirements 
        of subsection (a) if the contracting officer obtains 
        the information described in subparagraph (A)(ii) in 
        accordance with standards and procedures set forth in 
        the Federal Acquisition Regulation.
          [(C) A contracting officer may require submission of 
        cost or pricing data under subsection (a) only if the 
        contracting officer makes a written determination that 
        the agency is unable to obtain the information 
        described in subparagraph (A)(ii).
          [(3) Authority to audit.--(A) In accordance with 
        procedures prescribed in the Federal Acquisition 
        Regulation, the head of an executive agency is 
        authorized to examine all information provided by an 
        offeror, contractor, or subcontractor pursuant to 
        paragraph (2)(A) and all books and records of such 
        offeror, contractor, or subcontractor that directly 
        relate to such information in order to determine 
        whether the agency is receiving accurate information 
        required under this section.
          [(B) The right under subparagraph (A) shall expire 2 
        years after the date of award of the contract, or 2 
        years after the date of the modification of the 
        contract, with respect to which the information was 
        provided.
          [(4) Limitations on requests for data.--The Federal 
        Acquisition Regulation shall include reasonable 
        limitations on requests under this subsection for sales 
        data relating to commercial items.
          [(5) Form of information.--In requesting information 
        from an offeror under this subsection, a contracting 
        officer shall, to the maximum extent practicable, limit 
        the scope of the request to include only information 
        that is in the form regularly maintained by the offeror 
        in commercial operations.
          [(6) Confidentiality.--Any information received under 
        this subsection that is exempt from disclosure under 
        section 552(b) of title 5 shall not be disclosed by the 
        Federal Government.]
  (b) Exceptions.--
          (1) In general.--Submission of cost or pricing data 
        shall not be required under subsection (a) in the case 
        of a contract, a subcontract, or a modification of a 
        contract or subcontract--
                  (A) for which the price agreed upon is based 
                on--
                          (i) adequate price competition; or
                          (ii) prices set by law or regulation;
                  (B) for the acquisition of a commercial item; 
                or
                  (C) in an exceptional case when the head of 
                the procuring activity, without delegation, 
                determines that the requirements of this 
                section may be waived and justifies in writing 
                the reasons for such determination.
          (2) Modifications of contracts and subcontracts for 
        commercial items.--In the case of a modification of a 
        contract or subcontract for a commercial item that is 
        not covered by the exception on the submission of cost 
        or pricing data in paragraph (1)(A) or (1)(B), 
        submission of cost or pricing data shall not be 
        required under subsection (a) if--
                  (A) the contract or subcontract being 
                modified is a contract or subcontract for which 
                submission of cost or pricing data may not be 
                required by reason of paragraph (1)(A) or 
                (1)(B); and
                  (B) the modification would not change the 
                contract or subcontract, as the case may be, 
                from a contract or subcontract for the 
                acquisition of a commercial item to a contract 
                or subcontract for the acquisition of an item 
                other than a commercial item.
  (c) Authority To Require Cost or Pricing Data on Below-
Threshold Contracts.--(1) Subject to paragraph (2), when 
certified cost or pricing data are not required to be submitted 
by subsection (a) for a contract, subcontract, or modification 
of a contract or subcontract, such data may nevertheless be 
required to be submitted by the head of the procuring activity, 
but only if the head of the procuring activity determines that 
such data are necessary for the evaluation by the agency of the 
reasonableness of the price of the contract, subcontract, or 
modification of a contract or subcontract. In any case in which 
the head of the procuring activity requires such data to be 
submitted under this subsection, the head of the procuring 
activity shall justify in writing the reason for such 
requirement.
  (2) The head of the procuring activity may not require 
certified cost or pricing data to be submitted under this 
paragraph for any contract or subcontract, or modification of a 
contract or subcontract, covered by the exceptions in 
subparagraph (A) or (B) of subsection (b)(1).
  (3) The head of a procuring activity may not delegate the 
functions under this paragraph.
  (d) Limitations on Other Information.--The Federal 
Acquisition Regulation shall include the following:
          (1) Provisions concerning the types of information 
        that contracting officers may consider in determining 
        whether the price of a procurement to the Government is 
        fair and reasonable when certified cost or pricing data 
        are not required to be submitted under this section, 
        including appropriate information on the prices at 
        which the same item or similar items have previously 
        been sold that is adequate for evaluating the 
        reasonableness of the price of the proposed contract or 
        subcontract for the procurement.
          (2) Reasonable limitations on requests for sales data 
        relating to commercial items.
          (3) A requirement that a contracting officer shall, 
        to the maximum extent practicable, limit the scope of 
        any request for information relating to commercial 
        items from an offeror to only that information that is 
        in the form regularly maintained by the offeror in 
        commercial operations.
          (4) A statement that any information received 
        relating to commercial items that is exempt from 
        disclosure under section 552(b) of title 5 shall not be 
        disclosed by the Federal Government.
          * * * * * * *
  [(h) Required Regulations.--The Federal Acquisition 
Regulation shall include regulations concerning the types of 
information that offerors must submit for a contracting officer 
to consider in determining whether the price of a procurement 
to the Government is fair and reasonable when certified cost or 
pricing data are not required to be submitted under this 
section because the price of the procurement to the United 
States is not expected to exceed the applicable threshold 
amount set forth in subsection (a) (as adjusted pursuant to 
paragraph (7) of such subsection). Such information, at a 
minimum, shall include appropriate information on the prices at 
which the same item or similar items have previously been sold 
that is adequate for evaluating the reasonableness of the price 
of a proposed contract or subcontract for the procurement.]
  [(i)] (h) Definitions.--In this section:
          (1) Cost or pricing data.--The term ``cost or pricing 
        data'' means all facts that, as of the date of 
        agreement on the price of a contract (or the price of a 
        contract modification) or, if applicable consistent 
        with subsection (e)(1)(B), another date agreed upon 
        between the parties, a prudent buyer or seller would 
        reasonably expect to affect price negotiations 
        significantly. Such term does not include information 
        that is judgmental, but does include the factual 
        information from which a judgment was derived.
          (2) Subcontract.--The term ``subcontract'' includes a 
        transfer of commercial items between divisions, 
        subsidiaries, or affiliates of a contractor or a 
        subcontractor.
          (3) Commercial item.--The term ``commercial item'' 
        has the meaning provided such term by section 4(12) of 
        the Office of Federal Procurement Policy Act.

SEC. 304B. MULTIYEAR CONTRACTS.

  (a) Authority.--An executive agency [may] shall, to the 
maximum extent possible, enter into a multiyear contract for 
the acquisition of property or services if--
          (1) funds are available and obligated for such 
        contract, for the full period of the contract or for 
        the first fiscal year in which the contract is in 
        effect, and for the estimated costs associated with any 
        necessary termination of such contract; and
          (2) the executive agency determines that--
                  (A) the need for the property or services is 
                reasonably firm and continuing over the period 
                of the contract; and
                  (B) a multiyear contract will serve the best 
                interests of the United States by [encouraging 
                full and open competition or] promoting economy 
                in administration, performance, and operation 
                of the agency's programs.
          * * * * * * *
SEC. 304D. CONTRACTOR SHARE OF GAINS AND LOSSES FROM COST, SCHEDULE, 
                    AND PERFORMANCE EXPERIENCE.

  The Federal Acquisition Regulation shall contain provisions 
to ensure that, for any cost-type contract or incentive-type 
contract, the contractor may be rewarded for contract 
performance exceeding the contract cost, schedule, or 
performance parameters to the benefit of the United States and 
may be penalized for failing to adhere to cost, schedule, or 
performance parameters to the detriment of the United States.
          * * * * * * *
SEC. 309. DEFINITIONS.

  As used in this title--
  (a) * * *
  (b) [The term ``competitive procedures'' means procedures 
under which an executive agency enters into a contract pursuant 
to full and open competition.] The term ``competitive 
procedures'' means procedures under which an executive agency 
enters into a contract pursuant to full and open competition 
that provides open access and is consistent with the need to 
efficiently fulfill the Government's requirements. Such term 
also includes--
          (1) * * *
          * * * * * * *
  (c) 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):
          (1) * * *
          * * * * * * *
          (4) The term ``[full and open competition] open 
        access''.
          * * * * * * *
                              ----------                              

                OFFICE OF FEDERAL PROCUREMENT POLICY ACT
             TITLE I--FEDERAL PROCUREMENT POLICY GENERALLY
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Office of 
Federal Procurement Policy Act''.
  (b) Table of Contents.--The table of contents for this Act is 
as follows:
              TITLE I--FEDERAL PROCUREMENT POLICY GENERALLY
Sec. 1. Short title; table of contents.
[Sec. 2. Declaration of policy.
[Sec. 3. Findings and purpose.]
     * * * * * * *
[Sec. 8. Responsiveness to Congress.]
Sec. 9. Effect on existing laws.
[Sec. 10. Effect on existing regulations.
[Sec. 11. Authorization of appropriations.]
     * * * * * * *
Sec. 17. Government reliance on the private sector.
     * * * * * * *
Sec. 29. Contract clauses and certifications.
     * * * * * * *
Sec. 35. Contractor performance.
Sec. 36. Rapid contracting goal.
Sec. 37. Value engineering.
Sec. 38. Acquisition workforce.

                      TITLE II--DISPUTE RESOLUTION

                     Subtitle A--General Provisions

Sec. 201. Definitions.
Sec. 202. Membership.
Sec. 203. Chairman.
Sec. 204. Rulemaking authority.
Sec. 205. Authorization of appropriations.

  Subtitle B--Functions of the Defense and Civilian Boards of Contract 
                                 Appeals

Sec. 211. Alternative dispute resolution services.
Sec. 212. Alternative dispute resolution of disputes and protests 
          submitted to Boards.
Sec. 213. Contract disputes.
Sec. 214. Protests.
Sec. 215. Applicability to certain contracts.
[SEC. 2. DECLARATION OF POLICY.

  [It is the policy of the United States Government to promote 
economy, efficiency and effectiveness in the procurement of 
property and services by the executive branch of the Federal 
Government by--
          [(1) promoting full and open competition;
          [(2) establishing policies, procedures, and practices 
        which will provide the Government with property and 
        services of the requisite quality, within the time 
        needed, at the lowest reasonable cost;
          [(3) promoting the development of simplified uniform 
        procurement processes;
          [(4) promoting the participation of small business 
        concerns;
          [(5) supporting the continuing development of a 
        competent, professional work force;
          [(6) eliminating fraud and waste in the procurement 
        process;
          [(7) eliminating redundant administrative 
        requirements placed on contractor and Federal 
        procurement officials;
          [(8) promoting fair dealings and equitable 
        relationships with the private sector;
          [(9) ensuring that payment is made in a timely manner 
        and only for value received;
          [(10) requiring, to the extent practicable, the use 
        of commercial products to meet the Government's needs;
          [(11) requiring that personal services are obtained 
        in accordance with applicable personnel procedures and 
        not by contract;
          [(12) ensuring the development of procurement 
        policies that will accommodate emergencies and wartime 
        as well as peacetime requirements;
          [(13) promoting, whenever feasible, the use of 
        specifications which describe needs in terms of 
        functions to be performed or the performance required; 
        and
          [(14) establishing policies and procedures that 
        encourage the consideration of the offerors' past 
        performance in the selection of contractors.

[SEC. 3. FINDINGS AND PURPOSE.

  [(a) The Congress finds that economy, efficiency, and 
effectiveness in the procurement of property and services by 
the executive agencies will be improved by establishing an 
office to exercise responsibility for Government-wide 
procurement policies, regulations, procedures, and forms.
  [(b) The purpose of this Act is to establish an Office of 
Federal Procurement Policy in the Office of Management and 
Budget to provide overall direction of procurement policies, 
regulations, procedures, and forms for executive agencies in 
accordance with applicable laws.]

SEC. 4. DEFINITIONS.

  [As used in this Act:] Except as otherwise specifically 
provided, as used in this Act:
          (1) * * *
          * * * * * * *
          [(5) The term ``competitive procedures'' means 
        procedures under which an agency enters into a contract 
        pursuant to full and open competition.
          [(6) The term ``full and open competition'', when 
        used with respect to a procurement, means that all 
        responsible sources are permitted to submit sealed bids 
        or competitive proposals on the procurement.]
          (5) The term ``competitive procedures'' means 
        procedures under which an agency enters into a contract 
        pursuant to full and open competition that provides 
        open access and is consistent with the need to 
        efficiently fulfill the Government's requirements.
          (6) The term ``open access'', when used with respect 
        to a procurement, means that all responsible sources 
        are permitted to submit sealed bids or competitive 
        proposals on the procurement.
          * * * * * * *
          (12) The term ``commercial item'' means any of the 
        following:
                  (A) * * *
          * * * * * * *
                  (F) Services offered and sold competitively, 
                in substantial quantities, in the commercial 
                marketplace based on established [catalog] 
                prices for specific tasks performed and under 
                standard commercial terms and conditions.
          * * * * * * *

SEC. 5. OFFICE OF FEDERAL PROCUREMENT POLICY.

  [(a) There is established in the Office of Management and 
Budget an office to be known as the Office of Federal 
Procurement Policy (hereinafter referred to as the 
``Office'').]
  (a) To promote economy, efficiency, and effectiveness in the 
procurement of property and services by the executive branch of 
the Federal Government, there shall be an Office of Federal 
Procurement Policy (hereinafter referred to as the ``Office'') 
in the Office of Management and Budget to provide overall 
direction of Government-wide procurement policies, regulations, 
procedures, and forms for executive agencies.
          * * * * * * *

SEC. 6. AUTHORITY AND FUNCTIONS OF THE ADMINISTRATOR.

  (a) * * *
          * * * * * * *
  (d) The functions of the Administrator shall include--
          (1) * * *
          * * * * * * *
          (5) providing for and directing the activities of the 
        Federal Acquisition Institute (including recommending 
        to the Administrator of General Services a sufficient 
        budget for such activities), which shall be located in 
        the General Services Administration, in order to--
                  (A) foster and promote [Government-wide 
                career management programs for a professional 
                procurement work force] the development of a 
                professional acquisition workforce Government-
                wide;
                  (B) promote and coordinate Government-wide 
                research and studies to improve the procurement 
                process and the laws, policies, methods, 
                regulations, procedures, and forms relating to 
                [procurement by the] aquisition by the 
                executive agencies; [and]
                  [(C) establish policies and procedures for 
                the establishment and implementation of 
                education and training programs authorized by 
                this Act, including the establishment and 
                implementation of training, in conjunction with 
                the General Services Administration, for 
                critical procurement personnel designed to 
                increase the participation of small business 
                concerns owned and controlled by socially and 
                economically disadvantaged individuals, women, 
                and other minorities in procurement activities 
                conducted by an executive agency.]
                  (C) administer the provisions of section 38;
                  (D) collect data and analyze acquisition 
                workforce data from the Office of Personnel 
                Management, the heads of executive agencies, 
                and, through periodic surveys, from individual 
                employees;
                  (E) periodically analyze acquisition career 
                fields to identify critical competencies, 
                duties, tasks, and related academic 
                prerequisites, skills, and knowledge;
                  (F) coordinate and assist agencies in 
                identifying and recruiting highly qualified 
                candidates for acquisition fields;
                  (G) develop instructional materials for 
                acquisition personnel in coordination with 
                private and public acquisition colleges and 
                training facilities;
                  (H) evaluate the effectiveness of training 
                and career development programs for acquisition 
                personnel;
                  (I) promote the establishment and utilization 
                of academic programs by colleges and 
                universities in acquisition fields;
                  (J) facilitate, to the extent requested by 
                agencies, interagency intern and training 
                programs; and
                  (K) perform other career management or 
                research functions as directed by the 
                Administrator.
          * * * * * * *

[SEC. 8. RESPONSIVENESS TO CONGRESS.

  [(a) The Administrator shall keep the Congress and its duly 
authorized committees fully and currently informed of the major 
activities of the Office of Federal Procurement Policy, and 
shall submit a report thereon to the House of Representatives 
and the Senate annually and at such other times as may be 
necessary for this purpose.
  [(b) At least 30 days prior to the effective date of any 
policy or regulation prescribed under section 6(a), the 
Administrator shall transmit to the Congress a report on the 
proposed policy or regulation. Such report shall include--
          [(1) a full description of the policy or regulation;
          [(2) a summary of the reasons for the issuance of 
        such policy or regulation; and
          [(3) the names and positions of employees of the 
        Office who will be made available, prior to such 
        effective date, for full consultation with such 
        Committees regarding such policy or regulation.
  [(c) In the case of an emergency, the President may waive the 
notice requirement of subsection (b) by submitting in writing 
to the Congress his reasons therefor at the earliest 
practicable date on or before the effective date of any policy 
or regulation.]
          * * * * * * *

[SEC. 10. EFFECT ON EXISTING REGULATIONS.

  [Procurement policies, regulations, procedures, or forms in 
effect on the date of enactment of the Office of Federal 
Procurement Policy Act Amendments of 1983 shall continue in 
effect, as modified from time to time, until repealed, amended, 
or superseded by policies, regulations, procedures, or forms 
promulgated by the Administrator.

[SEC. 11. AUTHORIZATION OF APPROPRIATIONS.

  [There are authorized to be appropriated to carry out the 
provisions of this Act, and for no other purpose, $4,500,000 
for the fiscal year ending September 30, 1984, and such sums as 
may be necessary for each succeeding fiscal year.]
          * * * * * * *

SEC. 16. EXECUTIVE AGENCY RESPONSIBILITIES.

  To further [achieve] promote effective, efficient, and 
economic administration of the Federal procurement system, the 
head of each executive agency shall, in accordance with 
applicable laws, Government-wide policies and regulations, and 
good business practices--
          [(1) increase the use of full and open competition in 
        the procurement of property or services by the 
        executive agency by establishing policies, procedures, 
        and practices that assure that the executive agency 
        receives a sufficient number of sealed bids or 
        competitive proposals from responsible sources to 
        fulfill the Government's requirements (including 
        performance and delivery schedules) at the lowest 
        reasonable cost considering the nature of the property 
        or service procured;]
          (1) to implement competition that provides open 
        access for responsible sources in the procurement of 
        property or services by the executive agency by 
        establishing policies, procedures, and practices that 
        are consistent with the need to efficiently fulfill the 
        Government's requirements;
          * * * * * * *

SEC. 17. GOVERNMENT RELIANCE ON THE PRIVATE SECTOR.

  It is the policy of the Federal Government to rely on the 
private sector to supply the products and services the Federal 
Government needs.
SEC. 18. PROCUREMENT NOTICE.

  (a)(1) Except as provided in subsection (c)--
          (A) an executive agency intending to--
                  (i) solicit bids or proposals for a contract 
                for property or services for a price expected 
                to exceed $25,000; or
                  (ii) place an order, expected to exceed 
                $25,000, under a basic agreement, basic 
                ordering agreement, or similar arrangement,
        shall furnish for publication by the Secretary of 
        Commerce a notice of solicitation described in 
        subsection (b);
          (B) an executive agency intending to solicit bids or 
        proposals for a contract for property or services for a 
        price expected to exceed $10,000 but not to exceed 
        $25,000 shall post, for a period of not less than ten 
        days, in a public place at the contracting office 
        issuing the solicitation a notice of solicitation 
        described in [subsection (f)--
                  [(i) in the case of an executive agency other 
                than the Department of Defense, if a contract 
                is for a price expected to exceed $10,000, but 
                not to exceed $25,000; and
                  [(ii) in the case of the Department of 
                Defense, if the contract is for a price 
                expected to exceed $5,000, but not to exceed 
                $25,000; and] subsection (b); and
          * * * * * * *
  [(4) An executive agency intending to solicit offers for a 
contract for which a notice of solicitation is required to be 
posted under paragraph (1)(B) shall ensure that contracting 
officers consider each responsive offer timely received from an 
offeror.]
  [(5)] (4) An executive agency shall establish a deadline for 
the submission of all bids or proposals in response to a 
solicitation with respect to which no such deadline is provided 
by statute. Each deadline for the submission of offers shall 
afford potential offerors a reasonable opportunity to respond.
  [(6)] (5) The Administrator shall prescribe regulations 
defining [limited] circumstances in which flexible deadlines 
can be used under paragraph (3) for the issuance of 
solicitations and the submission of bids or proposals for the 
procurement of commercial items.
  (b) Each notice of solicitation required by subparagraph (A) 
or (B) of subsection (a)(1) shall include--
          (1) * * *
          (2) provisions that--
                  (A) state whether the technical data required 
                to respond to the solicitation will not be 
                furnished as part of such solicitation, and 
                identify the source in the Government, if any, 
                from which the technical data may be obtained; 
                and
                  [(B) state whether an offeror, its product, 
                or service must meet a qualification 
                requirement in order to be eligible for award, 
                and if so, identify the office from which the 
                qualification requirement may be obtained;]
                  (B) state whether the acquisition is to be 
                conducted pursuant to a contractor verification 
                system (as provided pursuant to section 35) or 
                whether the offeror, its product, or its 
                service otherwise must meet a qualification 
                requirement in order to be eligible for award 
                and, if so, identify the criteria to be used in 
                determining such eligibility;
          * * * * * * *
          [(4) a statement that all responsible sources may 
        submit a bid, proposal, or quotation (as appropriate) 
        which shall be considered by the agency;]
          (4) a statement that all responsible sources may 
        submit for consideration a bid, proposal, or quotation;
          * * * * * * *
          (6) in the case of a contract in an amount estimated 
        to be greater than $25,000 but not greater than the 
        simplified acquisition [threshold--] threshold, or a 
        contract for the procurement of commercial items using 
        simplified procedures--
                  (A) a description of the procedures to be 
                used in awarding the contract; and
                  (B) a statement specifying the periods for 
                prospective offerors and the contracting 
                officer to take the necessary preaward and 
                award actions.
          * * * * * * *

SEC. 20. ADVOCATES FOR COMPETITION.

  (a)(1) There is established in each executive agency an 
advocate for competition.
  (2) The head of each executive agency shall--
          (A) designate for the executive agency and for each 
        procuring activity of the executive agency one officer 
        or employee [serving in a position authorized for such 
        executive agency on the date of enactment of the 
        Competition in Contracting Act of 1984] (other than the 
        senior procurement executive designated pursuant to 
        section 16(3)) to serve as the advocate for 
        competition;
          * * * * * * *
  (b) The advocate for competition of an executive agency 
shall--
          (1) be responsible for challenging barriers to and 
        promoting full and open competition that provides open 
        access and is consistent with the need to efficiently 
        fulfill the Government's requirements in the 
        procurement of property and services by the executive 
        agency;
          (2) review the procurement activities of the 
        executive agency;
          (3) identify and report to the senior procurement 
        executive of the executive agency designated pursuant 
        to section 16(3)--
                  (A) opportunities and actions taken to 
                achieve full and open competition that provides 
                open access and is consistent with the need to 
                efficiently fulfill the Government's 
                requirements in the procurement activities of 
                the executive agency; and
                  (B) any condition or action which has the 
                effect of unnecessarily restricting competition 
                in the procurement actions of the executive 
                agency; and
          (4) prepare and transmit to such senior procurement 
        executive an annual report describing--
                  (A) such advocate's activities under this 
                section;
                  (B) new initiatives required to increase 
                competition; and
                  (C) barriers [to full and open competition 
                that remain] that remain to achieving full and 
                open competition that provides open access and 
                is consistent with the need to efficiently 
                fulfill the Government's requirements;
          (5) recommend to the senior procurement executive of 
        the executive agency goals and the plans for increasing 
        competition on a fiscal year basis;
          (6) recommend to the senior procurement executive of 
        the executive agency a system of personal and 
        organizational accountability for competition, which 
        may include the use of recognition and awards to 
        motivate program managers, contracting officers, and 
        others in authority to promote competition in 
        procurement programs; and
          (7) describe other ways in which the executive agency 
        has emphasized competition in programs for procurement 
        training and research.
  (c) The advocate for competition for each procuring activity 
shall be responsible for promoting full and open competition 
that provides open access and is consistent with the need to 
efficiently fulfill the Government's requirements, promoting 
the acquisition of commercial items, and challenging barriers 
to such acquisition, including such barriers as unnecessarily 
restrictive statements of need, unnecessarily detailed 
specifications, and unnecessarily burdensome contract clauses.
          * * * * * * *

SEC. 26. COST ACCOUNTING STANDARDS BOARD.

  (a) * * *
          * * * * * * *
  (f) Cost Accounting Standards Authority.--(1) * * *
  (2)(A) Cost accounting standards promulgated under this 
section shall be mandatory for use by all executive agencies 
and by contractors and subcontractors in estimating, 
accumulating, and reporting costs in connection with pricing 
and administration of, and settlement of disputes concerning, 
all negotiated prime contract and subcontract procurements with 
the United States in excess of $500,000.
  (B) Subparagraph (A) does not apply to the following 
contracts or subcontracts:
          [(i) Contracts or subcontracts where the price 
        negotiated is based on established catalog or market 
        prices of commercial items sold in substantial 
        quantities to the general public.]
          (i) Contracts or subcontracts for the acquisition of 
        commercial items.
          (ii) Contracts or subcontracts where the price 
        negotiated is based on prices set by law or regulation.
          [(iii) Any other firm fixed-price contract or 
        subcontract (without cost incentives) for commercial 
        items.]
          * * * * * * *

[SEC. 27. PROCUREMENT INTEGRITY.

  [(a) Prohibited Conduct by Competing Contractors.--During the 
conduct of any Federal agency procurement of property or 
services, no competing contractor or any officer, employee, 
representative, agent, or consultant of any competing 
contractor shall knowingly--
          [(1) make, directly or indirectly, any offer or 
        promise of future employment or business opportunity 
        to, or engage, directly or indirectly, in any 
        discussion of future employment or business opportunity 
        with, any procurement official of such agency, except 
        as provided in subsection (c);
          [(2) offer, give, or promise to offer or give, 
        directly or indirectly, any money, gratuity, or other 
        thing of value to any procurement official of such 
        agency; or
          [(3) solicit or obtain, directly or indirectly, from 
        any officer or employee of such agency, prior to the 
        award of a contract any proprietary or source selection 
        information regarding such procurement.
  [(b) Prohibited Conduct by Procurement Officials.--During the 
conduct of any Federal agency procurement of property or 
services, no procurement official of such agency shall 
knowingly--
          [(1) solicit or accept, directly or indirectly, any 
        promise of future employment or business opportunity 
        from, or engage, directly or indirectly, in any 
        discussion of future employment or business opportunity 
        with, any officer, employee, representative, agent, or 
        consultant of a competing contractor, except as 
        provided in subsection (c);
          [(2) ask for, demand, exact, solicit, seek, accept, 
        receive, or agree to receive, directly or indirectly, 
        any money, gratuity, or other thing of value from any 
        officer, employee, representative, agent, or consultant 
        of any competing contractor for such procurement; or
          [(3) disclose any proprietary or source selection 
        information regarding such procurement directly or 
        indirectly to any person other than a person authorized 
        by the head of such agency or the contracting officer 
        to receive such information.
  [(c) Recusal.--(1) A procurement official may engage in a 
discussion with a competing contractor that is otherwise 
prohibited by subsection (b)(1) if, before engaging in such 
discussion--
          [(A) the procurement official proposes in writing to 
        disqualify himself from the conduct of any procurement 
        relating to the competing contractor (i) for any period 
        during which future employment or business 
        opportunities for such procurement official with such 
        competing contractor have not been rejected by either 
        the procurement official or the competing contractor, 
        and (ii) if determined to be necessary by the head of 
        such procuring official's procuring activity (or his 
        designee) in accordance with criteria prescribed in 
        implementing regulations, for a reasonable period 
        thereafter; and
          [(B) the head of that procuring activity of such 
        procurement official (or his designee), after 
        consultation with the appropriate designated agency 
        ethics official, approves in writing the recusal of the 
        procurement official.
  [(2) A procurement official who, during the period beginning 
with the issuance of a procurement solicitation and ending with 
the award of a contract, has participated personally and 
substantially in the evaluation of bids or proposals, selection 
of sources, or conduct of negotiations in connection with such 
solicitation and contract may not be approved for a recusal 
under paragraph (1) during such period with respect to such 
procurement.
  [(3) A procurement official who, during the period beginning 
with the negotiation of a modification or extension of a 
contract and ending with--
          [(A) an agreement to modify or extend the contract, 
        or
          [(B) a decision not to modify or extend the contract,
has participated personally and substantially in the evaluation 
of a proposed modification or extension or the conduct of 
negotiations may not be approved for a recusal under paragraph 
(1) during such period with respect to such procurement.
  [(4) A competing contractor may engage in a discussion with a 
procurement official that is otherwise prohibited by subsection 
(a)(1) if, before engaging in such discussion, the procurement 
official has been recused in accordance with this subsection.
  [(5) Regulations implementing this subsection shall include 
specific criteria to be used in making determinations and 
approving recusals under paragraph (1).
  [(d) Disclosure to Unauthorized Persons.--During the conduct 
of any Federal agency procurement of property or services, no 
person who is given authorized or unauthorized access to 
proprietary or source selection information regarding such 
procurement, shall knowingly disclose such information, 
directly or indirectly, to any person other than a person 
authorized by the head of such agency or the contracting 
officer to receive such information.
  [(e) Certification and Enforcement Matters.--(1) A Federal 
agency may not award a contract for the procurement of property 
or services to any competing contractor, or agree to any 
modification or extension of a contract, unless the officer or 
employee of such contractor responsible for the offer or bid 
for such contract, or the modification or extension of such 
contract, as the case may be--
          [(A)(i) certifies in writing to the contracting 
        officer responsible for such contract that such officer 
        or employee of the competing contractor has no 
        information concerning a violation or possible 
        violation of subsection (a), (b), (d), or (f), or 
        applicable implementing regulations, pertaining to such 
        procurement; or
          [(ii) discloses to such contracting officer any and 
        all such information and certifies in writing to such 
        contracting officer that any and all such information 
        has been disclosed; and
          [(B) certifies in writing to such contracting 
        officer, except in the case of a contract for the 
        procurement of commercial items, that each officer, 
        employee, agent, representative, and consultant of such 
        competing contractor who has participated personally 
        and substantially in the preparation or submission of 
        such bid or offer, or in such modification or extension 
        of such contract, as the case may be, has certified to 
        such competing contractor that he or she--
                  [(i) is familiar with, and will comply with, 
                the requirements of subsection (a) and 
                applicable implementing regulations; and
                  [(ii) will report immediately to the officer 
                or employee of the competing contractor 
                responsible for the offer or bid for any 
                contract or the modification or extension of 
                such contract, as the case may be, any 
                information concerning a violation or possible 
                violation of subsection (a), (b), (d), or (f), 
                or such applicable implementing regulations, 
                pertaining to such procurement.
  [(2) A Federal agency may not award a contract for the 
procurement of property or services, or agree to any 
modification or extension of any such contract, unless the 
contracting officer responsible for such procurement--
          [(A) certifies in writing to the head of such agency 
        that the contracting officer has no information 
        concerning a violation or possible violation of 
        subsection (a), (b), (d), or (f), or applicable 
        implementing regulations, pertaining to such 
        procurement; or
          [(B) discloses to the head of such agency any and all 
        such information and certifies in writing that any and 
        all such information has been disclosed.
  [(3) The head of a Federal agency may require any procurement 
official or any competing contractor, at any time during the 
conduct of any Federal agency procurement of property or 
services--
          [(A) to certify in writing to the head of such agency 
        that such procurement official or the officer or 
        employee of the competing contractor responsible for 
        the offer or bid for such contract or the modification 
        or extension of such contract, as the case may be, has 
        no information concerning a violation or possible 
        violation of subsection (a), (b), (d), or (f), or 
        applicable implementing regulations, pertaining to such 
        procurement; or
          [(B) to disclose to the head of such agency any and 
        all such information and to certify in writing that any 
        and all such information has been disclosed.
  [(4) If a procurement official leaves the Government during 
the conduct of such a procurement, such official shall certify 
that he or she understands the continuing obligation not to 
disclose proprietary or source selection information.
  [(5) For the purposes of enforcing the requirements of this 
section, the contracting officer responsible for the conduct of 
a procurement shall maintain, as part of the procurement file--
          [(A) all certifications made by procurement officials 
        and competing contractors with regard to such 
        procurement, as required by this subsection; and
          [(B) a record of all persons who have been authorized 
        by the head of the agency or the contracting officer to 
        have access to proprietary or source selection 
        information regarding such procurement.
  [(6) Any person making a certification required by this 
subsection shall be notified of the applicability of section 
1001 of title 18, United States Code, to false, fictitious, or 
fraudulent statements in such certification.
  [(7)(A) This subsection applies only to contracts, 
extensions, and modifications in excess of $100,000.
  [(B) This subsection need not be applied to a contract--
          [(i) with a foreign government or an international 
        organization that is not required to be awarded using 
        competitive procedures pursuant to section 303(c)(4) of 
        the Federal Property and Administrative Services Act of 
        1949 or section 2304(c)(4) of title 10, United States 
        Code; or
          [(ii) in an exceptional case, when the head of the 
        Federal agency concerned determines in writing that 
        this subsection should be waived pursuant to procedures 
        and criteria established in implementing regulations 
        issued pursuant to subsection (o) and notifies the 
        Congress in writing of such determination.
The authority to make determinations under clause (ii) of this 
subparagraph may not be delegated.
  [(f) Restrictions Resulting From Procurement Activities of 
Procurement Officials.--(1) No individual who, while serving as 
an officer or employee of the Government or member of the Armed 
Forces, was a procurement official with respect to a particular 
procurement may knowingly--
          [(A) participate in any manner, as an officer, 
        employee, agent, or representative of a competing 
        contractor, in any negotiations leading to the award, 
        modification, or extension of a contract for such 
        procurement, or
          [(B) participate personally and substantially on 
        behalf of the competing contractor in the performance 
        of such contract,
during the period ending 2 years after the last date such 
individual participated personally and substantially in the 
conduct of such procurement or personally reviewed and approved 
the award, modification, or extension of any contract for such 
procurement.
  [(2) This subsection does not apply to any participation 
referred to in paragraph (1)(A) or (1)(B) with respect to a 
subcontractor who is a competing contractor unless--
          [(A) the subcontractor is a first or second tier 
        subcontractor and the subcontract is for an amount that 
        is in excess of $100,000;
          [(B) the subcontractor significantly assisted the 
        prime contractor with respect to negotiation of the 
        prime contract;
          [(C) the procurement official involved in the award, 
        modification, or extension of the prime contract 
        personally directed or recommended the particular 
        subcontractor to the prime contractor as a source for 
        the subcontract; or
          [(D) the procurement official personally reviewed and 
        approved the award, modification, or extension of the 
        subcontract.
  [(3)(A)(i) The President may grant a waiver of a restriction 
imposed by paragraph (1) (relating to post-Government service 
employment) to an officer or employee described in subparagraph 
(B) if the President determines and certifies in writing that 
it is in the public interest to grant the waiver and that the 
services of the officer or employee are critically needed for 
the benefit of the Federal Government. Not more than 25 
officers and employees currently employed by the Government at 
any one time may hold waivers under this subparagraph.
  [(ii) A waiver granted under this subparagraph to any person 
shall apply only with respect to activities engaged in by that 
person after that person's Government employment is terminated 
and only to that person's employment at a Government-owned, 
contractor operated entity with which the person served as an 
officer or employee immediately before the person's Government 
employment began.
  [(B) Waivers under subparagraph (A) may be granted only to 
civilian officers and employees of the executive branch, other 
than officers and employees in the Executive Office of the 
President.
  [(C) A certification under subparagraph (A) shall take effect 
upon its publication in the Federal Register and shall 
identify--
          [(i) the officer or employee covered by the waiver by 
        name and by position, and
          [(ii) the reasons for granting the waiver.
A copy of the certification shall also be provided to the 
Director of the Office of Government Ethics.
  [(D) The President may not delegate the authority provided by 
this paragraph.
  [(E)(i) Each person granted a waiver under this paragraph 
shall prepare reports, in accordance with clause (ii), stating 
whether the person has engaged in activities otherwise 
prohibited by this section for each six-month period described 
in clause (ii), and if so, what those activities were.
  [(ii) A report under clause (i) shall cover each six-month 
period beginning on the date of the termination of the person's 
Government employment (with respect to which the waiver under 
this paragraph was granted) and ending two years after that 
date. Such report shall be filed with the President and the 
Director of the Office of Government Ethics not later than 60 
days after the end of the six-month period covered by the 
report. All reports filed with the Director under this 
subparagraph shall be made available for public inspection and 
copying.
  [(iii) If a person fails to file any report in accordance 
with clauses (i) and (ii), the President shall revoke the 
waiver and notify the person of the revocation. The revocation 
shall take effect upon the person's receipt of the notification 
and shall remain in effect until the report is filed.
  [(iv) Any person who is granted a waiver under this paragraph 
shall be ineligible for appointment in the civil service unless 
all reports required of such person by clauses (i) and (ii) 
have been filed.
  [(F) As used in this paragraph, the term ``civil service'' 
has the meaning given that term in section 2101 of title 5, 
United States Code.
  [(g) Contractual Penalties.--(1) Regulations issued pursuant 
to subsection (o) shall require that each contract awarded by a 
Federal agency contain a clause specified in such regulation 
that provides appropriate contractual penalties for conduct of 
any competing contractor prohibited by subsection (a) and for 
any such conduct of any officer, employee, agent, 
representative, or consultant of such contractor.
  [(2) The following remedies are authorized to be included in, 
and shall be considered in the development of, such 
regulations:
          [(A) Denial of payment of all or any portion of the 
        profit component of amounts otherwise payable to the 
        contractor by the Federal agency under the contract and 
        recovery of all or any portion of the profit component 
        of amounts paid to the contractor by the Federal agency 
        under the contract.
          [(B) Termination of the contract for default.
          [(C) Any other appropriate penalty.
  [(h) Administrative Actions.--(1) If an agency receives a 
disclosure of information pursuant to subsection (e) or 
otherwise receives or obtains information providing a 
reasonable basis to believe that an officer, employee, agent, 
representative, or consultant of a competing contractor has 
knowingly violated the requirements of this section--
          [(A) in the case of a procurement in which a contract 
        has not been awarded, the agency shall determine 
        whether to terminate the procurement or take other 
        appropriate actions;
          [(B) in the case of a procurement with respect to 
        which a contract has been awarded, the agency shall 
        determine whether to void or rescind the contract, to 
        terminate the contract for default, to impose sanctions 
        upon the contractor, or to permit the contractor to 
        continue to perform the contract, subject to review in 
        accordance with, and to the extent provided in, the 
        Contract Disputes Act of 1978, or to take other 
        appropriate actions; and
          [(C) if the agency determines that such a knowing 
        violation has occurred, the agency, pursuant to 
        procedures specified in the Federal Acquisition 
        Regulation--
                  [(i) may impose an immediate suspension, and
                  [(ii) shall determine whether to initiate a 
                debarment proceeding,
        against the competing contractor or other person who 
        committed such violation.
  [(2) Any procurement official of a Federal agency who engages 
in conduct prohibited by subsection (b) or (d) shall be subject 
to removal or other appropriate adverse personnel action 
pursuant to the procedures specified in chapter 75 of title 5, 
United States Code, or other applicable law or regulation.
  [(3) The actions taken under paragraph (1) or (2) may be 
suspended by the agency head upon the request of the Attorney 
General pending the disposition of any civil or criminal 
actions pursuant to subsections (i) and (j).
  [(i) Civil Penalties.--Any person who engages in conduct 
prohibited by subsection (a), (b), (d), or (f) shall be subject 
to the imposition of a civil fine in a civil action brought by 
the United States in an appropriate district court of the 
United States. The amount of any such civil fine for such 
violation may not exceed--
          [(1) $100,000 in the case of an individual; or
          [(2) $1,000,000 in the case of a competing contractor 
        (other than an individual).
  [(j) Criminal Penalties.--Whoever, during the conduct of a 
Federal agency procurement of property or services--
          [(1) being a competing contractor or an officer, 
        employee, representative, agent, or consultant of a 
        competing contractor, knowingly and willfully solicits 
        or obtains, directly or indirectly, from any officer or 
        employee of such agency any proprietary or source 
        selection information (as such terms as defined in 
        subsection (p) and in regulations prescribed pursuant 
        to subsection (o)), or
          [(2) being an officer or employee of such agency, 
        knowingly and willfully discloses or promises to 
        disclose, directly or indirectly, to any competing 
        contractor or any officer, employee, representative, 
        agent, or consultant of a competing contractor any 
        proprietary or source selection information,
shall be imprisoned for not more than 5 years, or fined in 
accordance with title 18, United States Code, or both.
  [(k) Ethics Advice.--(1) Regulations implementing this 
section shall include procedures for a procurement official or 
former procurement official of a Federal agency to request 
advice from the appropriate designated agency ethics official 
regarding whether such procurement official or former 
procurement official is or would be precluded by this section 
from engaging in a specified activity.
  [(2) A procurement official or former procurement official of 
an agency who requests advice from a designated agency ethics 
official pursuant to paragraph (1) shall provide the agency 
ethics official with all information reasonably available to 
the procurement official or former procurement official that is 
relevant to a determination regarding such request.
  [(3) Not later than 30 days after the date on which the 
appropriate designated agency ethics official receives a 
request for advice pursuant to paragraph (1) accompanied by the 
information required by paragraph (2), or as soon thereafter as 
practicable, the official shall issue a written opinion 
regarding whether the requesting procurement official or former 
procurement official is precluded by this section from engaging 
in the specified activity.
  [(l) Training.--The head of each Federal agency shall 
establish a procurement ethics program for its procurement 
officials. The program shall, at a minimum--
          [(1) provide for the distribution of written 
        explanations of the provisions of subsections (b), (c), 
        and (e) to such procurement officials; and
          [(2) require each such procurement official, as a 
        condition of serving as a procurement official, to 
        certify that he or she is familiar with the provisions 
        of subsections (b), (c), and (e), and will not engage 
        in any conduct prohibited by such subsection, and will 
        report immediately to the contracting officer any 
        information concerning a violation or possible 
        violation of subsection (a), (b), (d), or (f), or 
        applicable implementing regulations.
  [(m) Remedies Not Exclusive.--Nothing in this subsection 
shall be construed to limit the applicability of the 
requirements, sanctions, contract penalties, and remedies 
established under any other law, but no agency shall be 
relieved of the obligation to carry out the requirements of 
this section because such agency has also applied such other 
requirements, sanctions, contract penalties, or remedies.
  [(n) No Authority To Withhold Information.--Nothing in this 
section shall be construed to authorize the withholding of any 
information from the Congress, any committee or subcommittee 
thereof, a Federal agency, any board of contract appeals of a 
Federal agency, the Comptroller General, or an Inspector 
General of a Federal agency.
  [(o) Implementing Regulations and Guidelines.--(1) 
Government-wide regulations and guidelines appropriate to carry 
out this section shall be included in the Federal Acquisition 
Regulation.
  [(2) Regulations implementing this section shall--
          [(A) define the term ``thing of value'' for the 
        purposes of this section and shall include a single 
        uniform Government-wide exclusion at a specific minimal 
        dollar amount; and
          [(B) authorize the delegation of the functions 
        assigned to designated agency ethics officials under 
        this section.
  [(3) Notwithstanding sections 6 and 25 of this Act, on and 
after June 1, 1990, the Director of the Office of Government 
Ethics shall have the responsibility for issuance, 
modification, or termination of Government-wide regulations 
implementing paragraphs (1) and (2) of subsection (a), 
paragraphs (1) and (2) of subsection (b), subsections (c), (f), 
and (k), and paragraph (2) of this subsection. The Director 
shall exercise such responsibility in coordination with the 
Federal Acquisition Regulatory Council.
  [(p) Definitions.--As used in this section:
          [(1) The term ``during the conduct of any Federal 
        agency procurement of property or services'' means the 
        period beginning on the earliest specific date, as 
        determined under implementing regulations, on which an 
        authorized official orders or requests an action 
        described in clauses (i)-(viii) of paragraph (3)(A), 
        and concluding with the award, modification, or 
        extension of a contract, and includes the evaluation of 
        bids or proposals, selection of sources, and conduct of 
        negotiations.
          [(2) The term ``competing contractor'', with respect 
        to any procurement (including any procurement using 
        procedures other than competitive procedures) of 
        property or services, means any entity that is, or is 
        reasonably likely to become, a competitor for or 
        recipient of a contract or subcontract under such 
        procurement, and includes any other person acting on 
        behalf of such an entity.
          [(3)(A) The term ``procurement official'' means, with 
        respect to any procurement (including the modification 
        or extension of a contract), any civilian or military 
        official or employee of an agency who has participated 
        personally and substantially in any of the following, 
        as defined in implementing regulations:
                  [(i) The drafting of a specification 
                developed for that procurement.
                  [(ii) The review and approval of a 
                specification developed for that procurement.
                  [(iii) The preparation or issuance of a 
                procurement solicitation in that procurement.
                  [(iv) The evaluation of bids or proposals for 
                that procurement.
                  [(v) The selection of sources for that 
                procurement.
                  [(vi) The conduct of negotiations in the 
                procurement.
                  [(vii) The review and approval of the award, 
                modification, or extension of a contract in 
                that procurement.
                  [(viii) Such other specific procurement 
                actions as may be specified in implementing 
                regulations.
          [(B) For purposes of subparagraph (A), the term 
        ``employee of an agency'' includes a contractor, 
        subcontractor, consultant, expert, or adviser (other 
        than a competing contractor) acting on behalf of, or 
        providing advice to, the agency with respect to any 
        phase of the agency procurement concerned.
          [(4) The term ``contracting officer'' means any 
        official or employee of a Federal agency who has been 
        authorized by the agency head or his or her designee to 
        enter into, administer, or terminate contracts and make 
        related determinations and findings.
          [(5) The term ``Federal agency'' has the meaning 
        provided by section 3(b) of the Federal Property and 
        Administrative Services Act of 1949 (40 U.S.C. 472(b)).
          [(6) The term ``proprietary information'' means--
                  [(A) information contained in a bid or 
                proposal;
                  [(B) cost or pricing data; or
                  [(C) any other information submitted to the 
                Government by a contractor and designated as 
                proprietary, in accordance with law or 
                regulation, by the contractor, the head of the 
                agency, or the contracting officer.
          [(7) The term ``source selection information'' means 
        information determined by the head of the agency or the 
        contracting officer to be information--
                  [(A) the disclosure of which to a competing 
                contractor would jeopardize the integrity or 
                successful completion of the procurement 
                concerned; and
                  [(B) which is required by statute, 
                regulation, or order to be secured in a source 
                selection file or other restricted facility to 
                prevent such disclosure;
        as further defined by regulations issued pursuant to 
        subsection (m) of this section.
  [(8) The term ``designated agency ethics official'' has the 
meaning given such term by section 109(3) of the Ethics in 
Government Act of 1978 (5 U.S.C. App.).]
SEC. 27. RESTRICTIONS ON DISCLOSING AND OBTAINING CONTRACTOR BID OR 
                    PROPOSAL INFORMATION OR SOURCE SELECTION 
                    INFORMATION.

  (a) Prohibition on Disclosing Procurement Information.--(1) A 
person described in paragraph (2) shall not, other than as 
provided by law, knowingly disclose contractor bid or proposal 
information or source selection information before the award of 
a Federal agency procurement contract to which the information 
relates.
  (2) Paragraph (1) applies to any person who--
          (A) is a present or former officer or employee of the 
        United States, or a person who is acting or has acted 
        for or on behalf of, or who is advising or has advised 
        the United States with respect to, a Federal agency 
        procurement; and
          (B) by virtue of that office, employment, or 
        relationship has or had access to contractor bid or 
        proposal information or source selection information.
  (b) Prohibition on Obtaining Procurement Information.--A 
person shall not, other than as provided by law, knowingly 
obtain contractor bid or proposal information or source 
selection information before the award of a Federal agency 
procurement contract to which the information relates.
  (c) Prohibition on Disclosing or Obtaining Procurement 
Information in Connection With a Protest.--(1) A person shall 
not, other than as provided by law, knowingly violate the terms 
of a protective order described in paragraph (2) by disclosing 
or obtaining contractor bid or proposal information or source 
selection information related to the procurement contract 
concerned.
  (2) Paragraph (1) applies to any protective order issued by 
the United States Board of Contract Appeals in connection with 
a protest against the award or proposed award of a Federal 
agency procurement contract.
  (d) Penalties and Administrative Actions.--
          (1) Criminal penalties.--
                  (A) Whoever engages in conduct constituting 
                an offense under subsection (a), (b), or (c) 
                shall be imprisoned for not more than one year 
                or fined as provided under title 18, United 
                States Code, or both.
                  (B) Whoever engages in conduct constituting 
                an offense under subsection (a), (b), or (c) 
                for the purpose of either--
                          (i) exchanging the information 
                        covered by such subsection for anything 
                        of value, or
                          (ii) obtaining or giving anyone a 
                        competitive advantage in the award of a 
                        Federal agency procurement contract,
                shall be imprisoned for not more than 15 years 
                or fined as provided under title 18, United 
                States Code, or both.
          (2) Civil penalties.--The Attorney General may bring 
        a civil action in the appropriate United States 
        district court against any person who engages in 
        conduct constituting an offense under subsection (a), 
        (b), or (c). Upon proof of such conduct by a 
        preponderance of the evidence, the person is subject to 
        a civil penalty. An individual who engages in such 
        conduct is subject to a civil penalty of not more than 
        $50,000 for each violation plus twice the amount of 
        compensation which the individual received or offered 
        for the prohibited conduct. An organization that 
        engages in such conduct is subject to a civil penalty 
        of not more than $500,000 for each violation plus twice 
        the amount of compensation which the organization 
        received or offered for the prohibited conduct.
          (3) Administrative actions.--(A) If a Federal agency 
        receives information that a contractor or a person has 
        engaged in conduct constituting an offense under 
        subsection (a), (b), or (c), the Federal agency shall 
        consider taking one or more of the following actions, 
        as appropriate:
                  (i) Cancellation of the Federal agency 
                procurement, if a contract has not yet been 
                awarded.
                  (ii) Rescission of a contract with respect to 
                which--
                          (I) the contractor or someone acting 
                        for the contractor has been convicted 
                        for an offense under subsection (a), 
                        (b), or (c), or
                          (II) the head of the agency that 
                        awarded the contract has determined, 
                        based upon a preponderance of the 
                        evidence, that the contractor or 
                        someone acting for the contractor has 
                        engaged in conduct constituting such an 
                        offense.
                  (iii) Initiation of suspension or debarment 
                proceedings for the protection of the 
                Government in accordance with procedures in the 
                Federal Acquisition Regulation.
                  (iv) Initiation of adverse personnel action, 
                pursuant to the procedures in chapter 75 of 
                title 5, United States Code, or other 
                applicable law or regulation.
          (B) If a Federal agency rescinds a contract pursuant 
        to subparagraph (A)(ii), the United States is entitled 
        to recover, in addition to any penalty prescribed by 
        law, the amount expended under the contract.
          (C) For purposes of any suspension or debarment 
        proceedings initiated pursuant to subparagraph 
        (A)(iii), engaging in conduct constituting an offense 
        under subsection (a), (b), or (c) affects the present 
        responsibility of a Government contractor or 
        subcontractor.
  (e) Definitions.--As used in this section:
          (1) The term ``contractor bid or proposal 
        information'' means any of the following information 
        submitted to a Federal agency as part of or in 
        connection with a bid or proposal to enter into a 
        Federal agency procurement contract, if that 
        information has not been previously made available to 
        the public or disclosed publicly:
                  (A) Cost or pricing data (as defined by 
                section 2306a(h) of title 10, United States 
                Code, with respect to procurements subject to 
                that section, and section 304A(h) of Federal 
                Property and Administrative Services Act of 
                1949 (41 U.S.C. 254b(h), with respect to 
                procurements subject to that section).
                  (B) Indirect costs and direct labor rates.
                  (C) Proprietary information about 
                manufacturing processes, operations, or 
                techniques marked by the contractor in 
                accordance with applicable law or regulation.
                  (D) Information marked by the contractor as 
                ``contractor bid or proposal information'', in 
                accordance with applicable law or regulation.
          (2) The term ``source selection information'' means 
        any of the following information prepared for use by a 
        Federal agency for the purpose of evaluating a bid or 
        proposal to enter into a Federal agency procurement 
        contract, if that information has not been previously 
        made available to the public or disclosed publicly:
                  (A) Bid prices submitted in response to a 
                Federal agency solicitation for sealed bids, or 
                lists of those bid prices before public bid 
                opening.
                  (B) Proposed costs or prices submitted in 
                response to a Federal agency solicitation, or 
                lists of those proposed costs or prices.
                  (C) Source selection plans.
                  (D) Technical evaluation plans.
                  (E) Technical evaluations of proposals.
                  (F) Cost or price evaluations of proposals.
                  (G) Competitive range determinations that 
                identify proposals that have a reasonable 
                chance of being selected for award of a 
                contract.
                  (H) Rankings of bids, proposals, or 
                competitors.
                  (I) The reports and evaluations of source 
                selection panels, boards, or advisory councils.
                  (J) Other information marked as ``source 
                selection information'' based on a case-by-case 
                determination by the head of the agency, his 
                designee, or the contracting officer that its 
                disclosure would jeopardize the integrity or 
                successful completion of the Federal agency 
                procurement to which the information relates.
          (3) The term ``Federal agency'' has the meaning 
        provided such term in section 3 of the Federal Property 
        and Administrative Services Act of 1949 (40 U.S.C. 
        472).
          (4) The term ``Federal agency procurement'' means the 
        acquisition (by using competitive procedures and 
        awarding a contract) of goods or services (including 
        construction) from non-Federal sources by a Federal 
        agency using appropriated funds.
          (5) The term ``contracting officer'' means a person 
        who, by appointment in accordance with applicable 
        regulations, has the authority to enter into a Federal 
        agency procurement contract on behalf of the Government 
        and to make determinations and findings with respect to 
        such a contract.
          (6) The term ``protest'' means a written objection by 
        an interested party to the award or proposed award of a 
        Federal agency procurement contract, pursuant to title 
        IV of the Federal Acquisition Reform Act of 1995.
  (f) Limitation on Protests.--No person may file a protest 
against the award or proposed award of a Federal agency 
procurement contract alleging an offense under subsection (a), 
(b), or (c), of this section, nor may the United States Board 
of Contract Appeals consider such an allegation in deciding a 
protest, unless that person reported to the Federal agency 
responsible for the procurement information that the person 
believed constituted evidence of the offense no later than 14 
days after the person first discovered the possible offense.
  (g) Savings Provisions.--This section does not--
          (1) restrict the disclosure of information to, or its 
        receipt by, any person or class of persons authorized, 
        in accordance with applicable agency regulations or 
        procedures, to receive that information;
          (2) restrict a contractor from disclosing its own bid 
        or proposal information or the recipient from receiving 
        that information;
          (3) restrict the disclosure or receipt of information 
        relating to a Federal agency procurement after it has 
        been canceled by the Federal agency before contract 
        award unless the Federal agency plans to resume the 
        procurement;
          (4) prohibit individual meetings between a Federal 
        agency employee and an offeror or potential offeror 
        for, or a recipient of, a contract or subcontract under 
        a Federal agency procurement, provided that 
        unauthorized disclosure or receipt of contractor bid or 
        proposal information or source selection information 
        does not occur;
          (5) authorize the withholding of information from, 
        nor restrict its receipt by, Congress, a committee or 
        subcommittee of Congress, the Comptroller General, a 
        Federal agency, or an inspector general of a Federal 
        agency;
          (6) authorize the withholding of information from, 
        nor restrict its receipt by, the United States Board of 
        Contract Appeals in the course of a protest against the 
        award or proposed award of a Federal agency procurement 
        contract; or
          (7) limit the applicability of any requirements, 
        sanctions, contract penalties, and remedies established 
        under any other law or regulation.
[SEC. 29. NONSTANDARD CONTRACT CLAUSES.]
SEC. 29. CONTRACT CLAUSES AND CERTIFICATIONS.
  (a) Nonstandard Contract Clauses.--The Federal Acquisition 
Regulatory Council shall promulgate regulations to discourage 
the use of a nonstandard contract clause on a repetitive basis. 
The regulations shall include provisions that--
          (1) clearly define what types of contract clauses are 
        to be treated as nonstandard clauses; and
          (2) require prior approval for the use of a 
        nonstandard clause on a repetitive basis by an official 
        at a level of responsibility above the contracting 
        officer.
  (b) Prohibition on Certification Requirements.--(1) A 
requirement for a certification by a contractor or offeror may 
not be included in the Federal Acquisition Regulation unless--
          (A) the certification is specifically imposed by 
        statute; or
          (B) written justification for such certification is 
        provided to the Administrator for Federal Procurement 
        Policy by the Federal Acquisition Regulatory Council, 
        and the Administrator approves in writing the inclusion 
        of such certification.
  (2)(A) A requirement for a certification by a contractor or 
offeror may not be included in a procurement regulation of an 
executive agency unless--
          (i) the certification is specifically imposed by 
        statute; or
          (ii) written justification for such certification is 
        provided to the head of the executive agency by the 
        senior procurement executive of the agency, and the 
        head of the executive agency approves in writing the 
        inclusion of such certification.
  (B) For purposes of subparagraph (A), the term ``head of the 
executive agency'' with respect to a military department means 
the Secretary of Defense.
  (C) The Secretary of Defense may delegate his duties under 
this paragraph only to the Under Secretary of Defense for 
Acquisition and Technology.
          * * * * * * *

SEC. 32. PROCEDURES APPLICABLE TO PURCHASES BELOW MICRO-PURCHASE 
                    THRESHOLD.

  (a) * * *
          * * * * * * *
  [(c) Applicability of Certain Provisions.--For purposes of 
section 27, an officer or employee of an executive agency, or a 
member of the Armed Forces of the United States, shall not be 
considered a procurement official if--
          [(1) the contracting authority of the officer, 
        employee, or member does not exceed $2,500; and
          [(2) the head of the contracting activity concerned 
        (or a designee of the head of the contracting activity 
        concerned) determines that the duties of the position 
        of that officer, employee, or member are such that is 
        it unlikely that the officer, employee, or member will 
        be required to conduct procurements in a total amount 
        greater than $20,000 in any 12-month period.]
  [(d)] (c) Purchases Without Competitive Quotations.--A 
purchase not greater than $2,500 may be made without obtaining 
competitive quotations if the contracting officer determines 
that the price for the purchase is reasonable.
  [(e)] (d) Equitable Distribution.--Purchases not greater than 
$2,500 shall be distributed equitably among qualified 
suppliers.
  [(f)] (e) Implementation Through FAR.--This section shall be 
implemented through the Federal Acquisition Regulation.
  [(g)] (f) Micro-Purchase Threshold Defined.--For purposes of 
this section, the micro-purchase threshold is the amount of 
$2,500.
          * * * * * * *
SEC. 35. CONTRACTOR PERFORMANCE.

  (a) Verification System.--
          (1) Requirement.--The Federal Acquisition Regulation 
        shall provide for a contractor verification system in 
        accordance with this section.
          (2) Procedures.--The Federal Acquisition Regulation 
        shall provide procedures for the head of an executive 
        agency to follow in order to verify a contractor as 
        eligible to compete for contracts to furnish property 
        or services that are procured by the executive agency 
        on a recurring basis.
          (3) Notification.--The procedures shall include a 
        requirement that the head of an executive agency 
        provide for the publication of appropriate notification 
        about the verification system in the Commerce Business 
        Daily.
  (b) Evaluation.--(1) Under the procedures referred to in 
subsection (a)(2), the head of an executive agency in granting 
a verification to a contractor shall use the following factors 
as the basis of the evaluation:
          (A) The efficiency and effectiveness of its business 
        practices.
          (B) The level of quality of its product or service.
          (C) Past performance of the contractor with regard to 
        the particular property or service.
  (2)(A) The evaluation of past performance may include 
performance under--
          (i) a contract with an executive agency of the 
        Federal Government;
          (ii) a contract with an agency of a State or local 
        government; or
          (iii) a contract with an entity in the private 
        sector.
  (B) The procedures shall include a requirement that, in the 
case of a contractor with respect to which there is no 
information on past contract performance or with respect to 
which information on past contract performance is not 
available, the contractor may not be evaluated favorably or 
unfavorably on the factor of past performance.
  (c) Opportunity for All Interested Sources.--The Federal 
Acquisition Regulation shall provide procedures for ensuring 
that all interested sources, including small businesses, have a 
fair opportunity to be considered for verification under the 
verification system.
  (d) Procurement From Verified Contractors.--The Federal 
Acquisition Regulation shall provide procedures under which the 
head of an executive agency may enter into a contract for the 
procurement of property or services referred to in subsection 
(a)(2) on the basis of a competition in accordance with section 
2304 of title 10, United States Code, or section 303 of the 
Federal Property and Administrative Services Act of 1949 (41 
U.S.C. 253) for contractors verified with respect to such 
property or services pursuant to the contractor verification 
system.
  (e) Termination of Verification.--The Federal Acquisition 
Regulation shall provide procedures under which the head of an 
executive agency--
          (1) may provide for the termination of a verification 
        granted a contractor under this section upon the 
        expiration of a period specified by the head of an 
        executive agency;
          (2) may revoke a verification granted a contractor 
        under this section upon a determination that the 
        quality of performance of the contractor does not meet 
        standards applied by the head of the executive agency 
        as of the time of the revocation decision; and
          (3) may provide that a contractor whose verification 
        is terminated or revoked will have a fair opportunity 
        to be considered for reentry into the verification 
        system.
  (f) Special Applicability Rule.--Notwithstanding section 34, 
the verification system shall apply to the procurement of 
commercial items.

SEC. 36. RAPID CONTRACTING GOAL.

  The Administrator for Federal Procurement Policy shall 
establish a goal of reducing by 50 percent the time necessary 
for executive agencies to acquire an item for the user of that 
item.

SEC. 37. VALUE ENGINEERING.

  (a) In General.--Each executive agency shall establish and 
maintain effective value engineering procedures and processes.
  (b) Threshold.--The procedures and processes established 
pursuant to subsection (a) shall be applied to those programs, 
projects, systems, and products of an executive agency that, in 
a ranking of all programs, projects, systems, and products of 
the agency according to greatest dollar value, are within the 
highest 20th percentile.
  (c) Definition.--As used in this section, the term ``value 
engineering'' means a team effort, performed by qualified 
agency or contractor personnel, directed at analyzing the 
functions of a program, project, system, product, item of 
equipment, building, facility, service, or supply for the 
purpose of achieving the essential functions at the lowest 
life-cycle cost that is consistent with required or improved 
performance, reliability, quality, and safety.
SEC. 38. ACQUISITION WORKFORCE.

  (a) Applicability.--This section does not apply to an 
executive agency that is subject to chapter 87 of title 10, 
United States Code.
  (b) Management Policies.--
          (1) Policies and procedures.--The head of each 
        executive agency, after consultation with the 
        Administrator for Federal Procurement Policy, shall 
        establish policies and procedures for the effective 
        management (including accession, education, training, 
        career development, and performance incentives) of the 
        acquisition workforce of the agency. The development of 
        acquisition workforce policies under this section shall 
        be carried out consistent with the merit system 
        principles set forth in paragraphs (1) and (2) of 
        section 2301(b) of title 5, United States Code.
          (2) Uniform implementation.--The head of each 
        executive agency shall ensure that, to the maximum 
        extent practicable, acquisition workforce policies and 
        procedures established are uniform in their 
        implementation throughout the agency.
          (3) Government-wide policies and evaluation.--The 
        Administrator shall issue policies to promote uniform 
        implementation of this section by executive agencies, 
        with due regard for differences in program requirements 
        among agencies that may be appropriate and warranted in 
        view of the agency mission. The Administrator shall 
        coordinate with the Deputy Director for Management of 
        the Office of Management and Budget to ensure that such 
        policies are consistent with the policies and 
        procedures established and enhanced system of 
        incentives provided pursuant to section 5051(c) of the 
        Federal Acquisition Streamlining Act of 1994 (41 U.S.C. 
        263 note). The Administrator shall evaluate the 
        implementation of the provisions of this section by 
        executive agencies.
  (c) Senior Procurement Executive Authorities and 
Responsibilities.--Subject to the authority, direction, and 
control of the head of an executive agency, the senior 
procurement executive of the agency shall carry out all powers, 
functions, and duties of the head of the agency with respect to 
implementation of this section. The senior procurement 
executive shall ensure that the policies of the head of the 
executive agency established in accordance with this section 
are implemented throughout the agency.
  (d) Management Information Systems.--The Administrator shall 
ensure that the heads of executive agencies collect and 
maintain standardized information on the acquisition workforce 
related to implementation of this section. To the maximum 
extent practicable, such data requirements shall conform to 
standards established by the Office of Personnel Management for 
the Central Personnel Data File.
  (e) Acquisition Workforce.--The programs established by this 
section shall apply to all employees in the General Schedule 
Contracting series (GS-1102) and the General Schedule 
Purchasing series (GS-1105), and to any employees regardless of 
series who have been appointed as contracting officers whose 
authority exceeds the micro-purchase threshold, as that term is 
defined in section 32(g). The head of each executive agency may 
include employees in other series who perform acquisition or 
acquisition-related functions.
  (f) Career Development.--
          (1) Career paths.--The head of each executive agency 
        shall ensure that appropriate career paths for 
        personnel who desire to pursue careers in acquisition 
        are identified in terms of the education, training, 
        experience, and assignments necessary for career 
        progression to the most senior acquisition positions. 
        The head of each executive agency shall make 
        information available on such career paths.
          (2) Critical duties and tasks.--For each career path, 
        the head of each executive agency shall identify the 
        critical acquisition-related duties and tasks in which, 
        at minimum, employees of the agency in the career path 
        shall be competent to perform at full performance grade 
        levels. For this purpose, the head of the executive 
        agency shall provide appropriate coverage of the 
        critical duties and tasks identified by the Director of 
        the Federal Acquisition Institute.
          (3) Mandatory training and education.--For each 
        career path, the head of each executive agency shall 
        establish requirements for the completion of course 
        work and related on-the-job training in the critical 
        acquisition-related duties and tasks of the career 
        path. The head of each executive agency shall also 
        encourage employees to maintain the currency of their 
        acquisition knowledge and generally enhance their 
        knowledge of related acquisition management disciplines 
        through academic programs and other self-developmental 
        activities.
          (4) Performance incentives.--The head of each 
        executive agency, acting through the senior procurement 
        executive for the agency, shall provide for an enhanced 
        system of incentives for the encouragement of 
        excellence in the acquisition workforce which rewards 
        performance of employees that contribute to achieving 
        the agency's performance goals. The system of 
        incentives shall include provisions that--
                  (A) relate pay to performance;
                  (B) provide for consideration, in personnel 
                evaluations and promotion decisions, of the 
                extent to which the performance of personnel 
                contributed to achieving the agency's 
                performance goals; and
                  (C) provide pay and promotion incentives to 
                be awarded, and unfavorable personnel actions 
                to be imposed, under the system on the basis of 
                the contributions of personnel to achieving the 
                agency's performance goals.
  (g) Qualification Requirements.--
          (1) General schedule contracting series (gs-1102).--
                  (A) Entry level qualifications.--The Director 
                of the Office of Personnel Management shall 
                require that, after October 1, 1996, a person 
                may not be appointed to a position in the GS-
                1102 occupational series unless the person--
                          (i) has received a baccalaureate 
                        degree from an accredited educational 
                        institution authorized to grant 
                        baccalaureate degrees,
                          (ii) has 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, economics, 
                        industrial management, marketing, 
                        quantitative methods, or organization 
                        and management, or
                          (iii) has passed a written test 
                        determined by the Administrator for 
                        Federal Procurement Policy, after 
                        consultation with the Director of the 
                        Office of Personnel Management, to 
                        demonstrate the judgmental skills 
                        necessary for positions in this series.
                  (B) Qualifications for senior contracting 
                positions.--The Director of the Office of 
                Personnel Management shall require that, after 
                October 1, 1996, persons may be appointed to 
                positions at and above full performance grade 
                levels in the GS-1102 occupational series only 
                if those persons--
                          (i) have satisfied the educational 
                        requirement either of subparagraph 
                        (A)(i) or (A)(ii),
                          (ii) have successfully completed all 
                        training required for the position 
                        under subsection (f)(3), and
                          (iii) have satisfied experience and 
                        other requirements established by the 
                        Director for such positions.
                However, this requirement shall apply to 
                persons employed on October 1, 1996, in GS-1102 
                positions at those grade levels only as a 
                prerequisite for promotion to a GS-1102 
                position at a higher grade.
          (2) General schedule purchasing series (gs-1105).--
        The Director of the Office of Personnel Management 
        shall require that, after October 1, 1996, a person may 
        not be appointed to a position in the GS-1105 
        occupational series unless the person--
                  (A) has successfully completed 2 years of 
                course work from an accredited educational 
                institution authorized to grant degrees, or
                  (B) has passed a written test determined by 
                the Administrator for Federal Procurement 
                Policy, after consultation with the Director of 
                the Office of Personnel Management, to 
                demonstrate the judgmental skills necessary for 
                positions in this series.
          (3) Contracting officers.--The head of each executive 
        agency shall require that, beginning after October 1, 
        1996, a person may be appointed as a contracting 
        officer with authority to award or administer contracts 
        for amounts above the micro-purchase threshold, as that 
        term is defined in section 32(g), only if the person--
                  (A) has successfully completed all mandatory 
                training required of an employee in an 
                equivalent GS-1102 or 1105 position under 
                subsection (f)(3); and
                  (B) meets experience and other requirements 
                established by the head of the agency, based on 
                the dollar value and complexity of the 
                contracts that the employee will be authorized 
                to award or administer under the appointment as 
                a contracting officer.
          (4) Exceptions.--(A) The requirements set forth in 
        paragraphs (1) and (2), as applicable, shall not apply 
        to any person employed in the GS-1102 or GS-1105 series 
        on October 1, 1996.
          (B) Employees of an executive agency who do not 
        satisfy the full qualification requirements for 
        appointment as a contracting officer under paragraph 
        (3) may be appointed as a contracting officer for a 
        temporary period of time under procedures established 
        by the agency head. The procedures shall--
                  (i) require that the person have completed a 
                significant portion of the required training,
                  (ii) require a plan be established for the 
                balance of the required training,
                  (iii) specify a period of time for completion 
                of the training, and
                  (iv) include provisions for withdrawing or 
                terminating the appointment prior to the 
                scheduled expiration date, where appropriate.
          (5) Waiver.--The senior procurement executive for an 
        executive agency may waive any or all of the 
        qualification requirements of paragraphs (1) and (2) 
        for a person if the person possesses significant 
        potential for advancement to levels of greater 
        responsibility and authority, based on demonstrated job 
        performance and qualifying experience. This authority 
        may not be redelegated by the senior procurement 
        executive. With respect to each waiver granted under 
        this subsection, the senior procurement executive shall 
        set forth in writing the rationale for the decision to 
        waive such requirements.
  (h) Program Establishment and Implementation.--
          (1) Funding levels.--(A) The head of an executive 
        agency shall request in the budget for a fiscal year 
        for the agency--
                  (i) for education and training under this 
                section, an amount equal to no less than 2.5 
                percent of the base aggregate salary cost of 
                the acquisition workforce subject to this 
                section for that fiscal year; and
                  (ii) for salaries of the acquisition 
                workforce, an amount equal to no more than 97.5 
                percent of such base aggregate salary cost.
          (B) The head of the executive agency shall set forth 
        separately the funding levels requested in the budget 
        justification documents submitted in support of the 
        President's budget submitted to Congress under section 
        1105 of title 31, United States Code.
          (C) Funds appropriated for education and training 
        under this section may not be obligated or used for any 
        other purpose.
          (2) Interagency agreements.--The head of an executive 
        agency may enter into a written agreement with another 
        agency to participate in programs established under 
        this section on a reimbursable basis.
          (3) Tuition assistance.--Notwithstanding the 
        prohibition in section 4107(b) of title 5, United 
        States Code, the head of each executive agency may 
        provide for tuition reimbursement and education 
        (including a full-time course of study leading to a 
        degree) for acquisition personnel in the agency related 
        to the purposes of this section.
          (4) Intern programs.--The head of each executive 
        agency may establish intern programs in order to 
        recruit highly qualified and talented individuals and 
        provide them with opportunities for accelerated 
        promotions, career broadening assignments, and 
        specified training for advancement to senior 
        acquisition positions. For such programs, the head of 
        an executive agency, without regard to the provisions 
        of title 5, United States Code, may appoint individuals 
        to competitive GS-5, GS-7, or GS-9 positions in the 
        General Schedule Contracting series (GS-1102) who have 
        graduated from baccalaureate or master's programs in 
        purchasing or contracting from accredited educational 
        institutions authorized to grant baccalaureate and 
        master's degrees.
          (5) Cooperative education program.--The head of each 
        executive agency may establish an agencywide 
        cooperative education credit program for acquisition 
        positions. Under the program, the head of the executive 
        agency may enter into cooperative arrangements with one 
        or more accredited institutions of higher education 
        which provide for such institutions to grant 
        undergraduate credit for work performed in such 
        position.
          (6) Scholarship program.--
                  (A) Establishment.--Where deemed appropriate, 
                the head of each executive agency may establish 
                a scholarship program for the purpose of 
                qualifying individuals for acquisition 
                positions in the agency.
                  (B) Eligibility.--To be eligible to 
                participate in a scholarship program 
                established under this paragraph by an 
                executive agency, an individual must--
                          (i) be accepted for enrollment or be 
                        currently enrolled as a full-time 
                        student at an accredited educational 
                        institution authorized to grant 
                        baccalaureate or graduate degrees (as 
                        appropriate);
                          (ii) be pursuing a course of 
                        education that leads toward completion 
                        of a bachelor's, master's, or doctor's 
                        degree (as appropriate) in a qualifying 
                        field of study, as determined by the 
                        head of the agency;
                          (iii) sign an agreement described in 
                        subparagraph (C) under which the 
                        participant agrees to serve a period of 
                        obligated service in the agency in an 
                        acquisition position in return for 
                        payment of educational assistance as 
                        provided in the agreement; and
                          (iv) meet such other requirements as 
                        the head of the agency prescribes.
                  (C) Agreement.--An agreement between the head 
                of an executive agency and a participant in a 
                scholarship program established under this 
                paragraph shall be in writing, shall be signed 
                by the participant, and shall include the 
                following provisions:
                          (i) The agreement of the head of the 
                        agency to provide the participant with 
                        educational assistance for a specified 
                        number of school years, not to exceed 
                        4, during which the participant is 
                        pursuing a course of education in a 
                        qualifying field of study. The 
                        assistance may include payment of 
                        tuition, fees, books, laboratory 
                        expenses, and a stipend.
                          (ii) The participant's agreement--
                                  (I) to accept such 
                                educational assistance,
                                  (II) to maintain enrollment 
                                and attendance in the course of 
                                education until completed,
                                  (III) while enrolled in such 
                                course, to maintain an 
                                acceptable level of academic 
                                standing (as prescribed by the 
                                head of the agency), and
                                  (IV) after completion of the 
                                course of education, to serve 
                                as a full-time employee in an 
                                acquisition position in the 
                                agency for a period of time of 
                                one calendar year for each 
                                school year or part thereof for 
                                which the participant was 
                                provided a scholarship under 
                                the program.
                  (D) Repayment.--(i) Any person participating 
                in a program established under this paragraph 
                shall agree to pay to the United States the 
                total amount of educational assistance provided 
                to the person under the program if the person 
                is voluntarily separated from the agency or 
                involuntarily separated for cause from the 
                agency before the end of the period for which 
                the person has agreed to continue in the 
                service of the agency in an acquisition 
                position.
                  (ii) If an employee fails to fulfill the 
                agreement to pay to the Government the total 
                amount of educational assistance provided to 
                the person under the program, a sum equal to 
                the amount of the educational assistance may be 
                recovered by the Government from the employee 
                (or the estate of the employee) by setoff 
                against accrued pay, compensation, amount of 
                retirement credit, or other amount due the 
                employee from the Government; and by such other 
                method as is provided by law for the recovery 
                of amounts owing to the Government.
                  (iii) The head of an executive agency may 
                waive in whole or in part a repayment required 
                under this paragraph if the head of the agency 
                determines the recovery would be against equity 
                and good conscience or would be contrary to the 
                best interests of the United States.
                  (E) Termination of agreement.--There shall be 
                no requirement that a position be offered to a 
                person after such person successfully completes 
                a course of education required by an agreement 
                under this paragraph. If no position is 
                offered, the agreement shall be considered 
                terminated.

                      TITLE II--DISPUTE RESOLUTION

                     Subtitle A--General Provisions

SEC. 201. DEFINITIONS.

  In this title:
          (1) The term ``Defense Board'' means the Department 
        of Defense Board of Contract Appeals established 
        pursuant to section 8(a) of the Contract Disputes Act 
        of 1978 (41 U.S.C. 607).
          (2) The term ``Civilian Board'' means the Civilian 
        Board of Contract Appeals established pursuant to 
        section 8(b) of the Contract Disputes Act of 1978 (41 
        U.S.C. 607).
          (3) The term ``Board judge'' means a member of the 
        Defense Board or the Civilian Board, as the case may 
        be.
          (4) The term ``Chairman'' means the Chairman of the 
        Defense Board or the Civilian Board, as the case may 
        be.
          (5) The term ``Board concerned'' means--
                  (A) the Defense Board with respect to matters 
                within its jurisdiction; and
                  (B) the Civilian Board with respect to 
                matters within its jurisdiction.
          (6) The term ``executive agency''--
                  (A) for purposes of contract disputes under 
                section 213--
                          (i) with respect to contract disputes 
                        under the jurisdiction of the Defense 
                        Board, means the Department of Defense, 
                        the Department of the Army, the 
                        Department of the Navy, or the 
                        Department of the Air Force; and
                          (ii) with respect to contract 
                        disputes under the jurisdiction of the 
                        Civilian Board, has the meaning given 
                        by section 2(2) of the Contract 
                        Disputes Act of 1978 (41 U.S.C. 601(2)) 
                        except that the term does not include 
                        the Department of Defense, the 
                        Department of the Army, the Department 
                        of the Navy, and the Department of the 
                        Air Force; and
                  (B) for purposes of protests under section 
                214--
                          (i) with respect to protests under 
                        the jurisdiction of the Defense Board, 
                        means the Department of Defense, the 
                        Department of the Army, the Department 
                        of the Navy, or the Department of the 
                        Air Force; and
                          (ii) with respect to protests under 
                        the jurisdiction of the Civilian Board, 
                        has the meaning given by section 4(1) 
                        of this Act except that the term does 
                        not include the Department of Defense, 
                        the Department of the Army, the 
                        Department of the Navy, and the 
                        Department of the Air Force.
          (7) The term ``alternative means of dispute 
        resolution'' has the meaning given by section 571(3) of 
        title 5, United States Code.
          (8) The term ``protest'' means a written objection by 
        an interested party to any of the following:
                  (A) A solicitation or other request by an 
                executive agency for offers for a contract for 
                the procurement of property or services.
                  (B) The cancellation of such a solicitation 
                or other request.
                  (C) An award or proposed award of such a 
                contract.
                  (D) A termination or cancellation of an award 
                of such a contract, if the written objection 
                contains an allegation that the termination or 
                cancellation is based in whole or in part on 
                improprieties concerning the award of the 
                contract.
          (9) The term ``interested party'', with respect to a 
        contract or a solicitation or other request for offers, 
        means an actual or prospective bidder or offeror whose 
        direct economic interest would be affected by the award 
        of the contract or by failure to award the contract.
          (10) The term ``prevailing party'', with respect to a 
        determination of the Board under section 214(h)(2) that 
        a decision of a contracting officer violates a statute 
        or regulation, means a party that demonstrated such 
        violation.

SEC. 202. MEMBERSHIP.

  (a) Appointment.--(1)(A) The Defense Board shall consist of 
judges appointed by the Chairman, without regard to political 
affiliation and solely on the basis of the professional 
qualifications required to perform the duties and 
responsibilities of a Defense Board judge, from a register of 
applicants maintained by the Defense Board.
  (B) The Civilian Board shall consist of judges appointed by 
the Chairman, without regard to political affiliation and 
solely on the basis of the professional qualifications required 
to perform the duties and responsibilities of a Civilian Board 
judge, from a register of applicants maintained by the Civilian 
Board.
  (2) The members of the Defense Board and the Civilian Board 
shall be selected and appointed to serve in the same manner as 
administrative law judges appointed pursuant to section 3105 of 
title 5, United States Code, with an additional requirement 
that such members shall have had not fewer than five years of 
experience in public contract law.
  (3) Notwithstanding paragraph (2) and subject to subsection 
(b), the following persons shall serve as Board judges:
          (A) For the Defense Board, any full-time member of 
        the Armed Services Board of Contract Appeals serving as 
        such on the day before the effective date of this 
        title.
          (B) For the Civilian Board, any full-time member of 
        any agency board of contract appeals other than the 
        Armed Services Board of Contract Appeals serving as 
        such on the day before the effective date of this 
        title.
          (C) For either the Defense Board or the Civilian 
        Board, any person serving on the day before the date of 
        the enactment of this title in a position at a level of 
        assistant general counsel or higher with authority 
        delegated from the Comptroller General to decide bid 
        protests under subchapter V of chapter 35 of title 31, 
        United States Code.
  (b) Removal.--Members of the Defense Board and the Civilian 
Board shall be subject to removal in the same manner as 
administrative law judges, as provided in section 7521 of title 
5, United States Code.
  (c) Compensation.--Compensation for the Chairman of the 
Defense Board and the Chairman of the Civilian Board and all 
other members of each Board shall be determined under section 
5372a of title 5, United States Code.

SEC. 203. CHAIRMAN.

  (a) Designation.--(1)(A) The Chairman of the Defense Board 
shall be designated by the Secretary of Defense to serve for a 
term of five years. The Secretary shall select the Chairman 
from among sitting judges each of whom has had at least five 
years of service--
          (i) as a member of the Armed Services Board of 
        Contract Appeals; or
          (ii) in a position at a level of assistant general 
        counsel or higher with authority delegated from the 
        Comptroller General to decide bid protests under 
        subchapter V of chapter 35 of title 31, United States 
        Code (as in effect on the day before the effective date 
        of this title).
  (B) The Chairman of the Civilian Board shall be designated by 
the Administrator of General Services to serve for a term of 
five years. The Administrator shall select the Chairman from 
among sitting judges each of whom has had at least five years 
of service--
          (i) as a member of an agency board of contract 
        appeals other than the Armed Services Board of Contract 
        Appeals; or
          (ii) in a position at a level of assistant general 
        counsel or higher with authority delegated from the 
        Comptroller General to decide bid protests under 
        subchapter V of chapter 35 of title 31, United States 
        Code (as in effect on the day before the effective date 
        of this title).
  (2) A Chairman of a Board may continue to serve after the 
expiration of the Chairman's term until a successor has taken 
office. A Chairman may be reappointed any number of times.
  (b) Responsibilities.--The Chairman of the Defense Board or 
the Civilian Board, as the case may be, shall be responsible on 
behalf of the Board for the executive and administrative 
operation of the Board, including functions of the Board with 
respect to the following:
          (1) The selection, appointment, and fixing of the 
        compensation of such personnel, pursuant to part III of 
        title 5, United States Code, as the Chairman considers 
        necessary or appropriate, including a Clerk of the 
        Board, a General Counsel, and clerical and legal 
        assistance for Board judges.
          (2) The supervision of personnel employed by or 
        assigned to the Board, and the distribution of work 
        among such personnel.
          (3) The operation of an Office of the Clerk of the 
        Board, including the receipt of all filings made with 
        the Board, the assignment of cases, and the maintenance 
        of all records of the Board.
          (4) The prescription of such rules and regulations as 
        the Chairman considers necessary or appropriate for the 
        administration and management of the Board.
  (c) Vice Chairmen.--The Chairman of the Defense Board or the 
Civilian Board, as the case may be, may designate up to four 
other Board judges as Vice Chairmen. The Chairman may divide 
the Board into two divisions, one for handling contract 
disputes and one for handling protests, and, if such division 
is made, shall assign a Vice Chairman to head each division. 
The Vice Chairmen, in the order designated by the Chairman, 
shall act in the place and stead of the Chairman during the 
absence of the Chairman.

SEC. 204. RULEMAKING AUTHORITY.

  The Chairman of the Defense Board and the Chairman of the 
Civilian Board shall jointly issue and maintain--
          (1) such procedural rules and regulations as are 
        necessary to the exercise of the functions of the 
        Boards under sections 213 and 214; and
          (2) statements of policy of general applicability 
        with respect to such functions.

SEC. 205. AUTHORIZATION OF APPROPRIATIONS.

  There are authorized to be appropriated for fiscal year 1997 
and each succeeding fiscal year such sums as may be necessary 
to carry out the provisions of this title. Funds for the 
activities of each Board shall be separately appropriated for 
such purpose. Funds appropriate pursuant to this section shall 
remain available until expended.

 Subtitle B--Functions of the Defense and Civilian Boards of Contract 
                                Appeals

SEC. 211. ALTERNATIVE DISPUTE RESOLUTION SERVICES.

  (a) Requirement To Provide Services Upon Request.--The 
Defense Board and the Civilian Board shall each provide 
alternative means of dispute resolution for any disagreement 
regarding a contract or prospective contract of an executive 
agency upon the request of all parties to the disagreement.
  (b) Personnel Qualified To Act.--Each Board judge and each 
attorney employed by the Board concerned shall be considered to 
be qualified to act for the purpose of conducting alternative 
means of dispute resolution under this section.
  (c) Services To Be Provided Without Charge.--Any services 
provided by the Board concerned or any Board judge or employee 
pursuant to this section shall be provided without charge.
  (d) Recusal of Certain Personnel Upon Request.--In the event 
that a matter which is presented to the Board concerned for 
alternative means of dispute resolution, pursuant to this 
section, later becomes the subject of formal proceedings before 
such Board, any Board judge or employee who was involved in the 
alternative means of dispute resolution shall, if requested by 
any party to the formal proceeding, take no part in that 
proceeding.

SEC. 212. ALTERNATIVE DISPUTE RESOLUTION OF DISPUTES AND PROTESTS 
                    SUBMITTED TO BOARDS.

  With reasonable promptness after the submission to the 
Defense Board or the Civilian Board of a contract dispute under 
section 213 or a bid protest under section 214, a Board judge 
to whom the contract dispute or protest is assigned shall 
request the parties to meet with a Board judge, or an attorney 
employed by the Board concerned, for the purpose of attempting 
to resolve the dispute or protest through alternative means of 
dispute resolution. Formal proceedings in the appeal shall then 
be suspended until such time as any party or a Board judge to 
whom the dispute or protest is assigned determines that 
alternative means of dispute resolution are not appropriate for 
resolution of the dispute or protest.

SEC. 213. CONTRACT DISPUTES.

  The Defense Board shall have jurisdiction as provided by 
section 8(a) of the Contract Disputes Act of 1978 (41 U.S.C. 
601-613). The Civilian Board shall have jurisdiction as 
provided by section 8(b) of such Act.

SEC. 214. PROTESTS.

  (a) Review Required Upon Request.--Upon request of an 
interested party in connection with any procurement conducted 
by an executive agency, the Defense Board or the Civilian 
Board, as the case may be, shall review, as provided in this 
section, any decision by the head of the executive agency 
alleged to violate a statute or regulation. A decision or order 
of the Board concerned pursuant to this section shall not be 
subject to interlocutory appeal or review.
  (b) Standard of Review.--In deciding a protest, the Board 
concerned may consider all evidence that is relevant to the 
decision under protest. It shall accord a presumption of 
correctness to the decision under protest. The protester may 
rebut such presumption by showing, by a preponderance of the 
evidence, that the decision was arbitrary or capricious or 
violated a statute or regulation.
  (c) Notification.--Within one day after the receipt of a 
protest, the Board concerned shall notify the executive agency 
involved of the protest.
  (d) Suspension of Contract Award.--(1) Except as provided in 
paragraph (2) of this subsection, a contract may not be awarded 
in any procurement after the executive agency has received 
notice of a protest with respect to such procurement from the 
Board concerned and while the protest is pending.
  (2) The head of the procuring activity responsible for award 
of a contract may authorize the award of the contract 
(notwithstanding a protest of which the executive agency has 
notice under this section)--
          (A) upon a written finding that urgent and compelling 
        circumstances which significantly affect interests of 
        the United States will not permit waiting for the 
        decision of the Board concerned under this section; and
          (B) after the Board concerned is advised of that 
        finding.
  (3) A finding may not be made under paragraph (2)(A) of this 
subsection unless the award of the contract is otherwise likely 
to occur within 30 days after the making of such finding.
  (4) The suspension of the award under paragraph (1) shall not 
preclude the executive agency concerned from continuing the 
procurement process up to but not including the award of the 
contract.
  (e) Suspension of Contract Performance.--(1) A contractor 
awarded an executive agency contract may, during the period 
described in paragraph (4), begin performance of the contract 
and engage in any related activities that result in obligations 
being incurred by the United States under the contract unless 
the contracting officer responsible for the award of the 
contract withholds authorization to proceed with performance of 
the contract.
  (2) The contracting officer may withhold an authorization to 
proceed with performance of the contract during the period 
described in paragraph (4) if the contracting officer 
determines in writing that--
          (A) a protest is likely to be filed; and
          (B) the immediate performance of the contract is not 
        in the best interests of the United States.
  (3)(A) If the executive agency awarding the contract receives 
notice of a protest in accordance with this section during the 
period described in paragraph (4)--
          (i) the contracting officer may not authorize 
        performance of the contract to begin while the protest 
        is pending; or
          (ii) if authorization for contract performance to 
        proceed was not withheld in accordance with paragraph 
        (2) before receipt of the notice, the contracting 
        officer shall immediately direct the contractor to 
        cease performance under the contract and to suspend any 
        related activities that may result in additional 
        obligations being incurred by the United States under 
        that contract.
  (B) Performance and related activities suspended pursuant to 
subparagraph (A)(ii) by reason of a protest may not be resumed 
while the protest is pending.
  (C) The head of the procuring activity may authorize the 
performance of the contract (notwithstanding a protest of which 
the executive agency has notice under this section)--
          (i) upon a written finding that urgent and compelling 
        circumstances that significantly affect interests of 
        the United States will not permit waiting for the 
        decision concerning the protest by the Board concerned; 
        and
          (ii) after the Board concerned is notified of that 
        finding.
  (4) The period referred to in paragraphs (2) and (3)(A), with 
respect to a contract, is the period beginning on the date of 
the contract award and ending on the later of--
          (A) the date that is 10 days after the date of the 
        contract award; or
          (B) the date that is 5 days after the debriefing date 
        offered to an unsuccessful offeror for any debriefing 
        that is requested and, when requested, is required.
  (f) The authority of the head of the procuring activity to 
make findings and to authorize the award and performance of 
contracts under subsections (d) and (e) of this section may not 
be delegated.
  (g) Procedures.--
          (1) Proceedings and discovery.--The Board concerned 
        shall conduct proceedings and allow such discovery to 
        the minimum extent necessary for the expeditious, fair, 
        and cost-effective resolution of the protest. The Board 
        concerned shall limit discovery to material which is 
        relevant to the grounds of protest or to such 
        affirmative defenses as the executive agency involved, 
        or any intervenor supporting the agency, may raise.
          (2) Priority.--The Board concerned shall give 
        priority to protests filed under this section over 
        contract disputes and alternative dispute services. 
        Except as provided in paragraph (3), the Board 
        concerned shall issue its final decision within 65 days 
        after the date of the filing of the protest, unless the 
        Chairman determines that the specific and unique 
        circumstances of the protest require a longer period, 
        in which case the Board concerned shall issue such 
        decision within the longer period determined by the 
        Chairman. An amendment that adds a new ground of 
        protest should be resolved, to the maximum extent 
        practicable, within the time limits established for 
        resolution of the initial protest.
          (3) Threshold.--(A) Except as provided in 
        subparagraph (B), any protest in which the anticipated 
        value of the contract award that will result from the 
        protested procurement, as estimated by the executive 
        agency involved, is less than $20,000,000 shall be 
        considered under simplified rules of procedure. Such 
        simplified rules shall provide that discovery in such 
        protests shall be in writing only. Such protests shall 
        be decided by a single Board judge. The Board concerned 
        shall issue its final decision in each such protest 
        within 40 days after the date of the filing of the 
        protest, unless the Chairman determines that the 
        specific and unique circumstances of the protest 
        require a longer period, in which case the Board 
        concerned shall issue such decision within the longer 
        period determined by the Chairman.
          (B) If the Chairman of the Board concerned determines 
        that special and unique circumstances of a protest that 
        would otherwise qualify for the simplified rules 
        described in subparagraph (A), including the complexity 
        of a protest, requires the use of full procedures as 
        described in paragraphs (1) and (2), the Chairman shall 
        use such procedures in lieu of the simplified rules 
        described in subparagraph (A).
          (4) Calculation of time for adr.--In calculating time 
        for purposes of paragraph (2) or (3) of this 
        subsection, any days during which proceedings are 
        suspended for the purpose of attempting to resolve the 
        protest by alternative means of dispute resolution, up 
        to a maximum of 20 days, shall not be counted.
          (5) Dismissal of frivolous protests.--The Board 
        concerned may dismiss a protest that the Board 
        concerned determines--
                  (A) is frivolous,
                  (B) has been brought or pursued in bad faith; 
                or
                  (C) does not state on its face a valid basis 
                for protest.
          (6) Payment of costs for frivolous protests.--(A) If 
        the Board concerned expressly finds that a protest or a 
        portion of a protest is frivolous or has been brought 
        or pursued in bad faith, the Board concerned shall 
        declare that the protester or other interested party 
        who joins the protest is liable to the United States 
        for payment of the costs described in subparagraph (B) 
        unless--
                  (i) special circumstances would make such 
                payment unjust; or
                  (ii) the protester obtains documents or other 
                information after the protest is filed with the 
                Board concerned that establishes that the 
                protest or a portion of the protest is 
                frivolous or has been brought or pursued in bad 
                faith, and the protester then promptly 
                withdraws the protest or portion of the 
                protest.
          (B) The costs referred to in subparagraph (A) are all 
        of the costs incurred by the United States of reviewing 
        the protest, or of reviewing that portion of the 
        protest for which the finding is made, including the 
        fees and other expenses (as defined in section 
        2412(d)(2)(A) of title 28, United States Code) incurred 
        by the United States in defending the protest.
  (h) Decisions and Corrective Actions on Protests.--(1) In 
making a decision on protests filed under this section, the 
Board concerned shall accord due weight to the goals of 
economic and efficient procurement, and shall take due account 
of the rule of prejudicial error.
  (2) If the Board concerned determines that a decision of the 
head of the executive agency violates a statute or regulation, 
the Board concerned may order the agency (or its head) to take 
such corrective action as the Board concerned considers 
appropriate. Corrective action includes requiring that the 
executive agency--
          (A) refrain from exercising any of its options under 
        the contract;
          (B) recompete the contract immediately;
          (C) issue a new solicitation;
          (D) terminate the contract;
          (E) award a contract consistent with the requirements 
        of such statute and regulation;
          (F) implement any combination of requirements under 
        subparagraphs (A), (B), (C), (D), and (E); or
          (G) implement such other actions as the Board 
        concerned determines necessary.
  (3) If the Board concerned orders corrective action after the 
contract award, the affected contract shall be presumed valid 
as to all goods or services delivered and accepted under the 
contract before the corrective action was ordered.
  (4) Any agreement that provides for the dismissal of a 
protest and involves a direct or indirect expenditure of 
appropriated funds shall be submitted to the Board concerned 
and shall be made a part of the public record (subject to any 
protective order considered appropriate by the Board concerned) 
before dismissal of the protest.
  (i) Authority To Declare Entitlement to Costs.--(1)(A) 
Whenever the Board concerned determines that a decision of a 
contracting officer violates a statute or regulation, it may, 
in accordance with section 1304 of title 31, United States 
Code, further declare an appropriate prevailing party to be 
entitled to the costs of--
          (i) filing and pursuing the protest, including 
        reasonable attorneys' fees and consultant and expert 
        witness fees, and
          (ii) bid and proposal preparation.
  (B) No party (other than a small business concern (within the 
meaning of section 3(a) of the Small Business Act)) may be 
declared entitled under this paragraph to costs for--
          (i) consultant and expert witness fees that exceed 
        the highest rate of compensation for expert witnesses 
        paid by the Federal Government, or
          (ii) attorneys' fees that exceed $150 per hour unless 
        the Board concerned, on a case by case basis, 
        determines that an increase in the cost of living or a 
        special factor, such as the limited availability of 
        qualified attorneys for the proceedings involved, 
        justifies a higher fee.
  (2) Payment of amounts due from an agency under paragraph (1) 
or under the terms of a settlement agreement under subsection 
(h)(4) shall be made from the appropriation made by section 
1304 of title 31, United States Code, for the payment of 
judgments. The executive agency concerned shall reimburse that 
appropriation account out of funds available for the 
procurement.
  (j) Appeals.--A final decision of the Board concerned may be 
appealed as set forth in section 8(g)(1) of the Contract 
Disputes Act of 1978 by the head of the executive agency 
concerned and by any interested party, including interested 
parties who intervene in any protest filed under this section.
  (k) Additional Relief.--Nothing contained in this section 
shall affect the power of the Board concerned to order any 
additional relief which it is authorized to provide under any 
statute or regulation.
  (l) Nonexclusivity of Remedies.--Nothing contained in this 
section shall affect the right of any interested party to file 
a protest with the contracting agency or to file an action in 
the United States Court of Federal Claims or in a United States 
district court.

SEC. 215. APPLICABILITY TO CERTAIN CONTRACTS.

  (a) Contracts at or Below the Simplified Acquisition 
Threshold.--Notwithstanding section 33 of this Act, the 
authority conferred on the Defense Board and the Civilian Board 
by this title is applicable to contracts in amounts not greater 
than the simplified acquisition threshold.
  (b) Contracts for Commercial Items.--Notwithstanding section 
34 of this Act, the authority conferred on the Defense Board 
and the Civilian Board by this title is applicable to contracts 
for the procurement of commercial items.
                              ----------                              

              FEDERAL ACQUISITION STREAMLINING ACT OF 1994

          * * * * * * *

                    TITLE V--ACQUISITION MANAGEMENT

                Subtitle A--Armed Services Acquisitions

SEC. 5001. PERFORMANCE BASED MANAGEMENT.

  (a) * * *
  (b) Enhanced System of Performance Incentives.--(1) Within 
one year after the date of the enactment of this Act, the 
Secretary of Defense shall review the incentives and personnel 
actions available to the Secretary of Defense for encouraging 
excellence in the management of defense acquisition programs 
and provide an enhanced system of incentives to facilitate the 
achievement of goals approved or defined pursuant to section 
2220(a) of title 10, United States Code.
  (2) The enhanced system of incentives shall, to the maximum 
extent consistent with applicable law--
          [(1)] (A) relate pay to performance (including the 
        extent to which the performance of personnel in such 
        programs contributes to achieving the cost goals, 
        performance goals, and schedule goals established for 
        acquisition programs of the Department of Defense 
        pursuant to section 2220(a) of title 10, as added by 
        subsection (a)); and
          [(2)] (B) provide for consideration, in personnel 
        evaluations and promotion decisions, of the extent to 
        which the performance of personnel in such programs 
        contributes to achieving the cost goals, performance 
        goals, and schedule goals established for acquisition 
        programs of the Department of Defense pursuant to 
        section 2220(a) of title 10, United States Code, as 
        added by subsection (a).
  (3) The Secretary shall include in the enhanced system of 
incentives the following:
          (A) Pay bands.
          (B) Significant and material pay and promotion 
        incentives to be awarded, and significant and material 
        unfavorable personnel actions to be imposed, under the 
        system exclusively, or primarily, on the basis of the 
        contributions of personnel to the performance of the 
        acquisition program in relation to cost goals, 
        performance goals, and schedule goals.
          (C) Provisions for pay incentives and promotion 
        incentives to be awarded under the system.
          * * * * * * *

SEC. 5002. REVIEW OF ACQUISITION PROGRAM CYCLE.

  (a) Review.--The Secretary of Defense shall review the 
regulations of the Department of Defense (1) to ensure that 
acquisition program cycle procedures are focused on achieving 
the goals that are consistent with the program baseline 
description established pursuant to section 2435 of title 10, 
United States Code[.]; (2) to ensure that the regulations 
compress the time periods associated with developing, 
procuring, and making operational new systems; and (3) to 
ensure that Department of Defense directives relating to 
development and procurement of information systems (numbered in 
the 8000 series) and the Department of Defense directives 
numbered in the 5000 series are consolidated into one series of 
directives that is consistent with such compressed time 
periods.
          * * * * * * *

                Subtitle B--Civilian Agency Acquisitions

SEC. 5051. PERFORMANCE BASED MANAGEMENT.

  (a) * * *
          * * * * * * *
  (c) Enhanced System of Performance Incentives.--(1) Within 
one year after the date of the enactment of this Act, the 
Deputy Director for Management of the Office of Management and 
Budget, in consultation with appropriate officials in other 
departments and agencies of the Federal Government, shall, to 
the maximum extent consistent with applicable law--
          [(1)] (A) establish policies and procedures for the 
        heads of such departments and agencies to designate 
        acquisition positions and manage employees (including 
        the accession, education, training and career 
        development of employees) in the designated acquisition 
        positions; and
          [(2)] (B) review the incentives and personnel actions 
        available to the heads of departments and agencies of 
        the Federal Government for encouraging excellence in 
        the acquisition workforce of the Federal Government and 
        provide an enhanced system of incentives for the 
        encouragement of excellence in such workforce which--
                  [(A)] (i) relates pay to performance 
                (including the extent to which the performance 
                of personnel in such workforce contributes to 
                achieving the cost goals, schedule goals, and 
                performance goals established for acquisition 
                programs pursuant to section 313(b) of the 
                Federal Property and Administrative Services 
                Act of 1949, as added by subsection (a)); and
                  [(B)] (ii) provides for consideration, in 
                personnel evaluations and promotion decisions, 
                of the extent to which the performance of 
                personnel in such workforce contributes to 
                achieving such cost goals, schedule goals, and 
                performance goals.
  (2) The Deputy Director shall include in the enhanced system 
of incentives under paragraph (1)(B) the following:
          (A) Pay bands.
          (B) Significant and material pay and promotion 
        incentives to be awarded, and significant and material 
        unfavorable personnel actions to be imposed, under the 
        system exclusively, or primarily, on the basis of the 
        contributions of personnel to the performance of the 
        acquisition program in relation to cost goals, 
        performance goals, and schedule goals.
          (C) Provisions for pay incentives and promotion 
        incentives to be awarded under the system.
          * * * * * * *

                       Subtitle C--Pilot Programs

SEC. 5061. OFPP TEST PROGRAM FOR EXECUTIVE AGENCIES.

  (a) * * *
          * * * * * * *
  [(j) Commencement and Expiration of Authority.--(1) The 
Administrator may not exercise the authority to conduct a test 
under subsection (a) in an agency and to award contracts under 
such a test before the date on which the head of the agency 
certifies to Congress under section 30A(a)(2) of the Office of 
Federal Procurement Policy Act that the agency has implemented 
a full FACNET capability.
  [(2) The authority to conduct a test under subsection (a) in 
an agency and to award contracts under such a test shall expire 
4 years after the date on which the head of the agency makes 
the certification referred to in paragraph (1). Contracts 
entered into before such authority expires in an agency 
pursuant to a test shall remain in effect, notwithstanding the 
expiration of the authority to conduct the test under this 
section.]
  (j) Commencement and Expiration of Authority.--The authority 
to conduct a test under subsection (a) in an agency and to 
award contracts under such a test shall take effect on August 
1, 1995, and shall expire on August 1, 2000. Contracts entered 
into before such authority expires in an agency pursuant to a 
test shall remain in effect, notwithstanding the expiration of 
the authority to conduct the test under this section.
          * * * * * * *

SEC. 5064. DEPARTMENT OF DEFENSE ACQUISITION PILOT PROGRAMS.

  (a) In General.--The Secretary of Defense is authorized to 
designate the following defense acquisition programs for 
participation in the defense acquisition pilot program 
authorized by section 809 of the National Defense Authorization 
Act for Fiscal Year 1991 (10 U.S.C. 2430 note):
          (1) * * *
          * * * * * * *
          (6) Joint standoff weapon unitary variant (jsow-
        uv).--The Joint Standoff Weapon Unitary Variant program 
        with respect to all contracts directly related to the 
        development and procurement of an air-delivered, 
        standoff weapon that incorporates a global positioning 
        system-aided inertial navigation system, a data link 
        capability, and a unitary warhead.
          * * * * * * *
  (c) Special Authority.--The authority delegated under 
subsection (a) may include authority for the Secretary of 
Defense--
          (1) to apply any amendment or repeal of a provision 
        of law made in this Act to the pilot programs before 
        the effective date of such amendment or repeal; [and]
          (2) to apply to a procurement of items other than 
        commercial items under such programs--
                  (A) any authority provided in this Act (or in 
                an amendment made by a provision of this Act) 
                to waive a provision of law in the case of 
                commercial items, and
                  (B) any exception applicable under this Act 
                (or an amendment made by a provision of this 
                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[.]; and
          (3) with respect to the program described in 
        subsection (a)(6)--
                  (A) to apply any amendment or repeal of a 
                provision of law made in the Federal 
                Acquisition Reform Act of 1995 to the pilot 
                program before the effective date of such 
                amendment or repeal; and
                  (B) to apply to a procurement of items other 
                than commercial items under such program any 
                waiver or exception applicable under the 
                Federal Acquisition Streamlining Act of 1994 
                (Public Law 103-355) or the Federal Acquisition 
                Reform Act of 1995 (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.
          * * * * * * *

            TITLE VII--SMALL BUSINESS AND SOCIOECONOMIC LAWS

                    Subtitle A--Small Business Laws

          * * * * * * *

SEC. 7102. CONTRACTING PROGRAM FOR CERTAIN SMALL BUSINESS CONCERNS.

  (a) Procurement Procedures Authorized.--(1) To facilitate the 
attainment of a goal for the participation of small business 
concerns owned and controlled by socially and economically 
disadvantaged individuals that is established for a Federal 
agency pursuant to section 15(g)(1) of the Small Business Act 
(15 U.S.C. 644(g)(1)), the head of the agency may enter into 
contracts using--
          (A) [less than full and open competition] procedures 
        other than competitive procedures by restricting the 
        competition for such awards to small business concerns 
        owned and controlled by socially and economically 
        disadvantaged individuals described in subsection 
        (d)(3)(C) of section 8 of the Small Business Act (15 
        U.S.C. 637); and
          (B) a price evaluation preference not in excess of 10 
        percent when evaluating an offer received from such a 
        small business concern as the result of an unrestricted 
        solicitation.
          * * * * * * *
                              ----------                              


                      TITLE 31, UNITED STATES CODE

          * * * * * * *

                       CHAPTER 13--APPROPRIATIONS

          * * * * * * *

         SUBCHAPTER III--LIMITATIONS, EXCEPTIONS, AND PENALTIES

          * * * * * * *

Sec. 1352. Limitation on use of appropriated funds to influence certain 
                    Federal contracting and financial transactions

  (a) * * *
  (b)(1) * * *
  (2) A declaration filed by a person pursuant to paragraph 
(1)(A) of this subsection in connection with a Federal 
contract, grant, loan, or cooperative agreement shall contain--
          (A) a statement setting forth whether such person--
                  (i) has made any payment with respect to that 
                Federal contract, grant, loan, or cooperative 
                agreement, using funds other than appropriated 
                funds, which would be prohibited by subsection 
                (a) of this section if the payment were paid 
                for with appropriated funds; or
                  (ii) has agreed to make any such payment; and
          * * * * * * *
          [(C) a certification that the person making the 
        declaration has not made, and will not make, any 
        payment prohibited by subsection (a).]
          * * * * * * *

                 CHAPTER 35--ACCOUNTING AND COLLECTION

          * * * * * * *
                [SUBCHAPTER V--PROCUREMENT PROTEST SYSTEM

[3551.  Definitions.
[3552.  Protests by interested parties concerning procurement actions.
[3553.  Review of protests; effect on contracts pending decision.
[3554.  Decisions on protests.
[3555.  Regulations; authority of Comptroller General to verify 
          assertions.
[3556.  Nonexclusivity of remedies; matters included in agency record.]
          * * * * * * *

               [SUBCHAPTER V--PROCUREMENT PROTEST SYSTEM

[Sec. 3551. Definitions

  [In this subchapter--
          [(1) The term ``protest'' means a written objection 
        by an interested party to any of the following:
                  [(A) A solicitation or other request by a 
                Federal agency for offers for a contract for 
                the procurement of property or services.
                  [(B) The cancellation of such a solicitation 
                or other request.
                  [(C) An award or proposed award of such a 
                contract.
                  [(D) A termination or cancellation of an 
                award of such a contract, if the written 
                objection contains an allegation that the 
                termination or cancellation is based in whole 
                or in part on improprieties concerning the 
                award of the contract.
          [(2) The term ``interested party'', with respect to a 
        contract or proposed contract described in paragraph 
        (1), means an actual or prospective bidder or offeror 
        whose direct economic interest would be affected by the 
        award of the contract or by failure to award the 
        contract.
          [(3) The term ``Federal agency'' has the meaning 
        given such term by section 3 of the Federal Property 
        and Administrative Services Act of 1949 (40 U.S.C. 
        472).
[Sec. 3552. Protests by interested parties concerning procurement 
                    actions

  [A protest concerning an alleged violation of a procurement 
statute or regulation shall be decided by the Comptroller 
General if filed in accordance with this subchapter. An 
interested party who has filed a protest under section 111(f) 
of the Federal Property and Administrative Services Act of 1949 
(40 U.S.C. 759(f)) with respect to a procurement or proposed 
procurement may not file a protest with respect to that 
procurement under this subchapter.

[Sec. 3553. Review of protests; effect on contracts pending decision

  [(a) Under procedures prescribed under section 3555 of this 
title, the Comptroller General shall decide a protest submitted 
to the Comptroller General by an interested party.
  [(b)(1) Within one day after the receipt of a protest, the 
Comptroller General shall notify the Federal agency involved of 
the protest.
  [(2) Except as provided in paragraph (3) of this subsection, 
a Federal agency receiving a notice of a protested procurement 
under paragraph (1) of this subsection shall submit to the 
Comptroller General a complete report (including all relevant 
documents) on the protested procurement--
          [(A) within 35 days after the date of the agency's 
        receipt of that notice;
          [(B) if the Comptroller General, upon a showing by 
        the Federal agency, determines (and states the reasons 
        in writing) that the specific circumstances of the 
        protest require a longer period, within the longer 
        period determined by the Comptroller General; or
          [(C) in a case determined by the Comptroller General 
        to be suitable for the express option under section 
        3554(a)(2) of this title, within 20 days after the date 
        of the Federal agency's receipt of that determination.
  [(3) A Federal agency need not submit a report to the 
Comptroller General pursuant to paragraph (2) of this 
subsection if the agency is sooner notified by the Comptroller 
General that the protest concerned has been dismissed under 
section 3554(a)(3) of this title.
  [(c)(1) Except as provided in paragraph (2) of this 
subsection, a contract may not be awarded in any procurement 
after the Federal agency has received notice of a protest with 
respect to such procurement from the Comptroller General and 
while the protest is pending.
  [(2) The head of the procuring activity responsible for award 
of a contract may authorize the award of the contract 
(notwithstanding a protest of which the Federal agency has 
notice under this section)--
          [(A) upon a written finding that urgent and 
        compelling circumstances which significantly affect 
        interests of the United States will not permit waiting 
        for the decision of the Comptroller General under this 
        subchapter; and
          [(B) after the Comptroller General is advised of that 
        finding.
  [(3) A finding may not be made under paragraph (2)(A) of this 
subsection unless the award of the contract is otherwise likely 
to occur within 30 days after the making of such finding.
  [(d)(1) A contractor awarded a Federal agency contract may, 
during the period described in paragraph (4), begin performance 
of the contract and engage in any related activities that 
result in obligations being incurred by the United States under 
the contract unless the contracting officer responsible for the 
award of the contract withholds authorization to proceed with 
performance of the contract.
  [(2) The contracting officer may withhold an authorization to 
proceed with performance of the contract during the period 
described in paragraph (4) if the contracting officer 
determines in writing that--
          [(A) a protest is likely to be filed; and
          [(B) the immediate performance of the contract is not 
        in the best interests of the United States.
  [(3)(A) If the Federal agency awarding the contract receives 
notice of a protest in accordance with this section during the 
period described in paragraph (4)--
          [(i) the contracting officer may not authorize 
        performance of the contract to begin while the protest 
        is pending; or
          [(ii) if authorization for contract performance to 
        proceed was not withheld in accordance with paragraph 
        (2) before receipt of the notice, the contracting 
        officer shall immediately direct the contractor to 
        cease performance under the contract and to suspend any 
        related activities that may result in additional 
        obligations being incurred by the United States under 
        that contract.
  [(B) Performance and related activities suspended pursuant to 
subparagraph (A)(ii) by reason of a protest may not be resumed 
while the protest is pending.
  [(C) The head of the procuring activity may authorize the 
performance of the contract (notwithstanding a protest of which 
the Federal agency has notice under this section)--
          [(i) upon a written finding that--
                  [(I) performance of the contract is in the 
                best interests of the United States; or
                  [(II) urgent and compelling circumstances 
                that significantly affect interests of the 
                United States will not permit waiting for the 
                decision of the Comptroller General concerning 
                the protest; and
          [(ii) after the Comptroller General is notified of 
        that finding.
  [(4) The period referred to in paragraphs (2) and (3)(A), 
with respect to a contract, is the period beginning on the date 
of the contract award and ending on the later of--
          [(A) the date that is 10 days after the date of the 
        contract award; or
          [(B) the date that is 5 days after the debriefing 
        date offered to an unsuccessful offeror for any 
        debriefing that is requested and, when requested, is 
        required.
  [(e) The authority of the head of the procuring activity to 
make findings and to authorize the award and performance of 
contracts under subsections (c) and (d) of this section may not 
be delegated.
  [(f)(1) Within such deadlines as the Comptroller General 
prescribes, upon request each Federal agency shall provide to 
an interested party any document relevant to a protested 
procurement action (including the report required by subsection 
(b)(2) of this section) that would not give that party a 
competitive advantage and that the party is otherwise 
authorized by law to receive.
  [(2)(A) The Comptroller General may issue protective orders 
which establish terms, conditions, and restrictions for the 
provision of any document to a party under paragraph (1), that 
prohibit or restrict the disclosure by the party of information 
described in subparagraph (B) that is contained in such a 
document.
  [(B) Information referred to in subparagraph (A) is 
procurement sensitive information, trade secrets, or other 
proprietary or confidential research, development, or 
commercial information.
  [(C) A protective order under this paragraph shall not be 
considered to authorize the withholding of any document or 
information from Congress or an executive agency.

[Sec. 3554. Decisions on protests

  [(a)(1) To the maximum extent practicable, the Comptroller 
General shall provide for the inexpensive and expeditious 
resolution of protests under this subchapter. Except as 
provided under paragraph (2) of this subsection, the 
Comptroller General shall issue a final decision concerning a 
protest within 125 days after the date the protest is submitted 
to the Comptroller General.
  [(2) The Comptroller General shall, by regulation prescribed 
pursuant to section 3555 of this title, establish an express 
option for deciding those protests which the Comptroller 
General determines suitable for resolution within 65 days after 
the date the protest is submitted.
  [(3) An amendment to a protest that adds a new ground of 
protest, if timely made, should be resolved, to the maximum 
extent practicable, within the time limit established under 
paragraph (1) of this subsection for final decision of the 
initial protest. If an amended protest cannot be resolved 
within such time limit, the Comptroller General may resolve the 
amended protest through the express option under paragraph (2) 
of this subsection.
  [(4) The Comptroller General may dismiss a protest that the 
Comptroller General determines is frivolous or which, on its 
face, does not state a valid basis for protest.
  [(b)(1) With respect to a solicitation for a contract, or a 
proposed award or the award of a contract, protested under this 
subchapter, the Comptroller General may determine whether the 
solicitation, proposed award, or award complies with statute 
and regulation. If the Comptroller General determines that the 
solicitation, proposed award, or award does not comply with a 
statute or regulation, the Comptroller General shall recommend 
that the Federal agency--
          [(A) refrain from exercising any of its options under 
        the contract;
          [(B) recompete the contract immediately;
          [(C) issue a new solicitation;
          [(D) terminate the contract;
          [(E) award a contract consistent with the 
        requirements of such statute and regulation;
          [(F) implement any combination of recommendations 
        under clauses (A), (B), (C), (D), and (E); or
          [(G) implement such other recommendations as the 
        Comptroller General determines to be necessary in order 
        to promote compliance with procurement statutes and 
        regulations.
  [(2) If the head of the procuring activity responsible for a 
contract makes a finding under section 3553(d)(2)(A)(i) of this 
title, the Comptroller General shall make recommendations under 
this subsection without regard to any cost or disruption from 
terminating, recompeting, or reawarding the contract.
  [(3) If the Federal agency fails to implement fully the 
recommendations of the Comptroller General under this 
subsection with respect to a solicitation for a contract or an 
award or proposed award of a contract within 60 days after 
receiving the recommendations, the head of the procuring 
activity responsible for that contract shall report such 
failure to the Comptroller General not later than 5 days after 
the end of such 60-day period.
  [(c)(1) If the Comptroller General determines that a 
solicitation for a contract or a proposed award or the award of 
a contract does not comply with a statute or regulation, the 
Comptroller General may recommend that the Federal agency 
conducting the procurement pay to an appropriate interested 
party the costs of--
          [(A) filing and pursuing the protest, including 
        reasonable attorneys' fees and consultant and expert 
        witness fees; and
          [(B) bid and proposal preparation.
  [(2) No party (other than a small business concern (within 
the meaning of section 3(a) of the Small Business Act)) may be 
paid, pursuant to a recommendation made under the authority of 
paragraph (1)--
          [(A) costs for consultant and expert witness fees 
        that exceed the highest rate of compensation for expert 
        witnesses paid by the Federal Government; or
          [(B) costs for attorneys' fees that exceed $150 per 
        hour unless the agency determines, based on the 
        recommendation of the Comptroller General on a case by 
        case basis, that an increase in the cost of living or a 
        special factor, such as the limited availability of 
        qualified attorneys for the proceedings involved, 
        justifies a higher fee.
  [(3) If the Comptroller General recommends under paragraph 
(1) that a Federal agency pay costs to an interested party, the 
Federal agency shall--
          [(A) pay the costs promptly; or
          [(B) if the Federal agency does not make such 
        payment, promptly report to the Comptroller General the 
        reasons for the failure to follow the Comptroller 
        General's recommendation.
  [(4) If the Comptroller General recommends under paragraph 
(1) that a Federal agency pay costs to an interested party, the 
Federal agency and the interested party shall attempt to reach 
an agreement on the amount of the costs to be paid. If the 
Federal agency and the interested party are unable to agree on 
the amount to be paid, the Comptroller General may, upon the 
request of the interested party, recommend to the Federal 
agency the amount of the costs that the Federal agency should 
pay.
  [(d) Each decision of the Comptroller General under this 
subchapter shall be signed by the Comptroller General or a 
designee for that purpose. A copy of the decision shall be made 
available to the interested parties, the head of the procuring 
activity responsible for the solicitation, proposed award, or 
award of the contract, and the senior procurement executive of 
the Federal agency involved.
  [(e)(1) The Comptroller General shall report promptly to the 
Committee on Governmental Affairs and the Committee on 
Appropriations of the Senate and to the Committee on Government 
Operations and the Committee on Appropriations of the House of 
Representatives any case in which a Federal agency fails to 
implement fully a recommendation of the Comptroller General 
under subsection (b) or (c). The report shall include--
          [(A) a comprehensive review of the pertinent 
        procurement, including the circumstances of the failure 
        of the Federal agency to implement a recommendation of 
        the Comptroller General; and
          [(B) a recommendation regarding whether, in order to 
        correct an inequity or to preserve the integrity of the 
        procurement process, the Congress should consider--
                  [(i) private relief legislation;
                  [(ii) legislative rescission or cancellation 
                of funds;
                  [(iii) further investigation by Congress; or
                  [(iv) other action.
  [(2) Not later than January 31 of each year, the Comptroller 
General shall transmit to the Congress a report containing a 
summary of each instance in which a Federal agency did not 
fully implement a recommendation of the Comptroller General 
under subsection (b) or (c) during the preceding year. The 
report shall also describe each instance in which a final 
decision in a protest was not rendered within 125 days after 
the date the protest is submitted to the Comptroller General.

[Sec. 3555. Regulations; authority of Comptroller General to verify 
                    assertions

  [(a) The Comptroller General shall prescribe such procedures 
as may be necessary to the expeditious decision of protests 
under this subchapter, including procedures for accelerated 
resolution of protests under the express option authorized by 
section 3554(a)(2) of this title. Such procedures shall provide 
that the protest process may not be delayed by the failure of a 
party to make a filing within the time provided for the filing.
  [(b) The procedures shall provide that, in the computation of 
any period described in this subchapter--
          [(1) the day of the act, event, or default from which 
        the designated period of time begins to run not be 
        included; and
          [(2) the last day after such act, event, or default 
        be included, unless--
                  [(A) such last day is a Saturday, a Sunday, 
                or a legal holiday; or
                  [(B) in the case of a filing of a paper at 
                the General Accounting Office or a Federal 
                agency, such last day is a day on which weather 
                or other conditions cause the closing of the 
                General Accounting Office or Federal agency, in 
                which event the next day that is not a 
                Saturday, Sunday, or legal holiday shall be 
                included.
  [(c) The Comptroller General may prescribe procedures for the 
electronic filing and dissemination of documents and 
information required under this subchapter. In prescribing such 
procedures, the Comptroller General shall consider the ability 
of all parties to achieve electronic access to such documents 
and records.
  [(d) The Comptroller General may use any authority available 
under chapter 7 of this title and this chapter to verify 
assertions made by parties in protests under this subchapter.

[Sec. 3556. Nonexclusivity of remedies; matters included in agency 
                    record

  [This subchapter does not give the Comptroller General 
exclusive jurisdiction over protests, and nothing contained in 
this subchapter shall affect the right of any interested party 
to file a protest with the contracting agency or to file an 
action in a district court of the United States or the United 
States Claims Court. In any such action based on a procurement 
or proposed procurement with respect to which a protest has 
been filed under this subchapter, the reports required by 
sections 3553(b)(2) and 3554(e)(1) of this title with respect 
to such procurement or proposed procurement and any decision or 
recommendation of the Comptroller General under this subchapter 
with respect to such procurement or proposed procurement shall 
be considered to be part of the agency record subject to 
review.]
          * * * * * * *
                              ----------                              

          SECTION 5152 OF THE DRUG-FREE WORKPLACE ACT OF 1988

SEC. 5152. DRUG-FREE WORKPLACE REQUIREMENTS FOR FEDERAL CONTRACTORS.

    (a) Drug-Free Workplace Requirement.--
          (1) Requirement for persons other than individuals.--
        No person, other than an individual, shall be 
        considered a responsible source, under the meaning of 
        such term as defined in section 4(8) of the Office of 
        Federal Procurement Policy Act (41 U.S.C. 403(8)), for 
        the purposes of being awarded a contract for the 
        procurement of any property or services of a value 
        greater than the simplified acquisition threshold (as 
        defined in section 4(11) of such Act (41 U.S.C. 
        403(11))) by any Federal agency, other than a contract 
        for the procurement of commercial items as defined in 
        section 4 of the Office of Federal Procurement Policy 
        Act (41 U.S.C. 403), unless such person [has certified 
        to the contracting agency that it will] agrees to 
        provide a drug-free workplace by--
                  (A) * * *
          * * * * * * *
          (2) Requirement for individuals.--No Federal agency 
        shall enter into a contract with an individual unless 
        such [contract includes a certification by the 
        individual] individual agrees that the individual will 
        not engage in the unlawful manufacture, distribution, 
        dispensation, possession, or use of a controlled 
        substance in the performance of the contract.
    (b) Suspension, Termination, or Debarment of the 
Contractor.--
          (1) Grounds for suspension, termination, or 
        debarment.--Each contract awarded by a Federal agency 
        shall be subject to suspension of payments under the 
        contract or termination of the contract, or both, and 
        the contractor thereunder or the individual who entered 
        the contract with the Federal agency, as applicable, 
        shall be subject to suspension or debarment in 
        accordance with the requirements of this section if the 
        head of the agency determines that--
                  [(A) the contractor or individual has made a 
                false certification under subsection (a);]
                  [(B)] (A) the contractor violates [such 
                certification by failing to carry out] the 
                requirements of subparagraph (A), (B), (C), 
                (D), (E), or (F) of subsection (a)(1); or
                  [(C)] (B) such a number of employees of such 
                contractor have been convicted of violations of 
                criminal drug statutes for violations occurring 
                in the workplace as to indicate that the 
                contractor has failed to make a good faith 
                effort to provide a drug-free workplace as 
                required by subsection (a).
          * * * * * * *
                              ----------                              

               SECTION 21 OF THE ARMS EXPORT CONTROL ACT

          * * * * * * *

           Chapter 2.--FOREIGN MILITARY SALES AUTHORIZATIONS

  Sec. 21. Sales From Stocks.--(a) * * *
          * * * * * * *
  (e)(1) After September 30, 1976, letters of offer for the 
sale of defense articles or for the sale of defense services 
that are issued pursuant to this section or pursuant to section 
22 of this Act shall include appropriate charges for--
          (A) administrative services, calculated on an average 
        percentage basis to recover the full estimated costs 
        (excluding a pro rata share of fixed base operations 
        costs) of administration of sales made under this Act 
        to all purchasers of such articles and services as 
        specified in section 43(b) and section 43(c) of this 
        Act; and
          [(B) a proportionate amount of any nonrecurring costs 
        of research, development, and production of major 
        defense equipment (except for equipment wholly paid for 
        either from funds transferred under section 503(a)(3) 
        of the Foreign Assistance Act of 1961 or from funds 
        made available on a nonrepayable basis under section 23 
        of this Act); and]
          [(C)] (B) the recovery of ordinary inventory losses 
        associated with the sale from stock of defense articles 
        that are being stored at the expense of the purchaser 
        of such articles.
  [(2) The President may reduce or waive the charge or charges 
which would otherwise be considered appropriate under paragraph 
(1)(B) for particular sales that would, if made, significantly 
advance United States Government interests in North Atlantic 
Treaty Organization standardization, standardization with the 
Armed Forces of Japan, Australia, or New Zealand in furtherance 
of the mutual defense treaties between the United States and 
those countries, or foreign procurement in the United States 
under coproduction arrangements.]
  [(3)] (2)(A) The President may waive the charges for 
administrative services that would otherwise be required by 
paragraph (1)(A) in connection with any sale to the Maintenance 
and Supply Agency of the North Atlantic Treaty Organization in 
support of--
          (i) a weapon system partnership agreement; or
          (ii) a NATO/SHAPE project.
  (B) The Secretary of Defense may reimburse the fund 
established to carry out section 43(b) of this Act in the 
amount of the charges waived under subparagraph (A) of this 
paragraph. Any such reimbursement may be made from any funds 
available to the Department of Defense.
  (C) As used in this paragraph--
          (i) the term ``weapon system partnership agreement'' 
        means an agreement between two or more member countries 
        of the Maintenance and Supply Agency of the North 
        Atlantic Treaty Organization that--
                  (I) is entered into pursuant to the terms of 
                the charter of that organization; and
                  (II) is for the common logistic support of a 
                specific weapon system common to the 
                participating countries; and
          (ii) the term ``NATO/SHAPE project'' means a common-
        funded project supported by allocated credits from 
        North Atlantic Treaty Organization bodies or by host 
        nations with NATO Infrastructure funds.
          * * * * * * *
                              ----------                              

      SECTION 33 OF THE FEDERAL ENERGY ADMINISTRATION ACT OF 1974

                       [organizational conflicts

  [Sec. 33. (a) The Administrator shall, by rule, require any 
person proposing to enter a contract, agreement, or other 
arrangement, whether by competitive bid or negotiation, under 
this Act or any other law administered by him for the conduct 
of research, development, evaluation activities, or for 
technical and management support services, to provide the 
Administrator, prior to entering into any such contract, 
agreement, or arrangement, with all relevant information, as 
determined by the Administrator, bearing on whether that person 
has a possible conflict of interest with respect to--
          [(1) being able to render impartial, technically 
        sound, or objective assistance or advice in light of 
        other activities or relationships with other persons, 
        or
          [(2) being given an unfair competitive advantage.
Such person shall insure, in accordance with regulations 
prescribed by the Administrator, compliance with this section 
by any subcontractor (other than a supply subcontractor) of 
such person in the case of any subcontract of more than 
$10,000.
  [(b) The Administrator shall not enter into any such 
contract, agreement, or arrangement unless he finds, after 
evaluating all information provided under subsection (a) and 
any other information otherwise available to him that--
          [(1) it is unlikely that a conflict of interest would 
        exist, or
          [(2) such conflict has been avoided after appropriate 
        conditions have been included in such contract, 
        agreement, or arrangement;
except that if he determines that such conflict of interest 
exists and that such conflict of interest cannot be avoided by 
including appropriate conditions therein, the Administrator may 
enter into such contract, agreement, or arrangement. If he 
determines that it is in the best interests of the United 
States to do so and includes appropriate conditions in such 
contract, agreement, or arrangement to mitigate such conflict.
  [(c) The Administrator shall publish rules for the 
implementation of this section, in accordance with section 533 
of title 5, United States Code (without regard to subsection 
(a)(2) thereof) as soon as practicable after the date of the 
enactment of this section, but in no event later than 120 days 
after such date.]
                              ----------                              

                      TITLE 18, UNITED STATES CODE

          * * * * * * *

                             PART I--CRIMES

          * * * * * * *

    CHAPTER 15--CLAIMS AND SERVICES IN MATTERS AFFECTING GOVERNMENT
Sec.
[281.  Restrictions on retired military officers regarding certain 
          matters affecting the Government.]
     * * * * * * *
[Sec. 281. Restrictions on retired military officers regarding certain 
                    matters affecting the Government

  [(a)(1) A retired officer of the Armed Forces who, while not 
on active duty and within two years after release from active 
duty, directly or indirectly receives (or agrees to receive) 
any compensation for representation of any person in the sale 
of anything to the United States through the military 
department in which the officer is retired (in the case of an 
officer of the Army, Navy, Air Force, or Marine Corps) or 
through the Department of Transportation (in the case of an 
officer of the Coast Guard) shall be fined under this title or 
imprisoned not more than two years, or both.
  [(2) Any person convicted under paragraph (1) shall be 
incapable of holding any office of honor, trust, or profit 
under the United States.
  [(b) A retired officer of the Armed Forces who, while not on 
active duty and within two years after release from active 
duty, acts as agent or attorney for prosecuting or assisting in 
the prosecution of any claim against the United States--
          [(1) involving the military department in which the 
        officer is retired (in the case of an officer of the 
        Army, Navy, Air Force, or Marine Corps) or the 
        Department of Transportation (in the case of an officer 
        of the Coast Guard); or
          [(2) involving any subject matter with which the 
        officer was directly connected while in an active-duty 
        status;
shall be fined under this title or imprisoned not more than one 
year, or both.
  [(c) This section does not apply--
          [(1) to any person because of the person's membership 
        in the National Guard of the District of Columbia; or
          [(2) to any person specifically excepted by law.]
                              ----------                              

 SECTION 19 OF THE FEDERAL NONNUCLEAR ENERGY RESEARCH AND DEVELOPMENT 
                              ACT OF 1974

  [Sec. 19. (a) The Administrator shall by regulation require 
any person proposing to enter into a contract, agreement, or 
other arrangement, with the Energy Research and Development 
Administration whether by advertising or negotiation, or for 
technical consulting and management support services or other 
such similar services to provide the Administrator, prior to 
entering into any such contract, agreement, or arrangement, 
with all relevant information bearing on whether that person 
has a possible conflict of interest with respect to (1) being 
able to render impartial, technically sound, or objective 
assistance or advice in light of other interests or 
relationships with other persons or (2) being given an unfair 
competitive advantage. Such person shall insure, in accordance 
with regulations published by the Administrator, compliance 
with this section by subcontractors of such person who are 
engaged to perform similar services.
  [(b) The Administrator shall not enter into any such 
contract, agreement, or arrangement unless he affirmatively 
finds after evaluating all such information and any other 
relevant information otherwise available to him, either that 
(1) there is little or no likelihood that a conflict of 
interest would exist, or (2) that such conflict has been 
avoided after appropriate conditions have been included in such 
contract, agreement, or arrangement: Provided, That if he 
determines that such conflict of interest exists and that such 
conflict of interest cannot be avoided by including appropriate 
conditions therein, the Administrator may enter into such 
contract, agreement, or arrangement, if he determines that it 
is in the best interests of the United States to do so and 
includes appropriate conditions in such contract, agreement, or 
arrangement to mitigate such conflict.
  [(c) The Administrator shall publish rules for the 
implementation of this section, in accordance with section 553 
of title 5, United States Code, as soon as possible after the 
date of enactment of this section but in no event later than 
180 days after such date.]
                              ----------                              

                     CONTRACT DISPUTES ACT OF 1978

                              definitions

  Sec. 2. As used in this Act--
          (1) * * *
          * * * * * * *
          [(6) The term ``agency board'' means an agency board 
        of contract appeals established under section 8 of this 
        Act; and]
          (6) the term ``Defense Board'' means the Department 
        of Defense Board of Contract Appeals established under 
        section 8(a) of this Act;
          (7) the term ``Civilian Board'' means the Civilian 
        Board of Contract Appeals established under section 
        8(b) of this Act; and
          [(7)] (8) The term ``misrepresentation of fact'' 
        means a false statement of substantive fact, or any 
        conduct which leads to a belief of a substantive fact 
        material to proper understanding of the matter in hand, 
        made with intent to deceive or mislead.
          * * * * * * *

                  decision by the contracting officer

  Sec. 6. (a) * * *
          * * * * * * *
  (c)(1) A contracting officer shall issue a decision on any 
submitted claim of $100,000 or less within sixty days from his 
receipt of a written request from the contractor that a 
decision be rendered within that period. For claim of more than 
$100,000, the contractor shall certify that the claim is made 
in good faith, that the supporting data are accurate and 
complete to the best of his knowledge and belief, that the 
amount requested accurately reflects the contract adjustment 
for which the contractor believes the government is liable, and 
that the certifier is duly authorized to certify the claim on 
behalf of the contractor.
          * * * * * * *
  (6) The contracting officer shall have no obligation to 
render a final decision on any claim of more than $100,000 that 
is not certified in accordance with paragraph (1) if, within 60 
days after receipt of the claim, the contracting officer 
notifies the contractor in writing of the reasons why any 
attempted certification was found to be defective. A defect in 
the certification of a claim shall not deprive a [court or an 
agency board of contract appeals] court, the Defense Board, or 
the Civilian Board of jurisdiction over that claim. Prior to 
the entry of a final judgment by a court or a decision by [an 
agency board of contract appeals] the Defense Board or the 
Civilian Board, the court or [agency board] the Board concerned 
shall require a defective certification to be corrected.
  (7) The certification required by paragraph (1) may be 
executed by any person duly authorized to bind the contractor 
with respect to the claim.
          * * * * * * *

       contractor's right of appeal to board of contract appeals

  Sec. 7. Within ninety days from the date of receipt of a 
contracting officer's decision under section 6, the contractor 
may appeal such decision to [an agency board of contract 
appeals] the Defense Board or the Civilian Board, as provided 
in section 8.

                  [agency boards of contract appeals]

            defense and civilian boards of contract appeals

  Sec. 8. [(a)(1) Except as provided in paragraph (2) an agency 
board of contract appeals may be established within an 
executive agency when the agency head, after consultation with 
the Administrator, determines from a workload study that the 
volume of contract claims justifies the establishment of a 
full-time agency board of at least three members who shall have 
no other inconsistent duties. Workload studies will be updated 
at least once every three years and submitted to the 
Administrator.
  [(2) The Board of Directors of the Tennessee Valley Authority 
may establish a board of contract appeals for the Authority of 
an indeterminate number of members.
  [(b)(1) Except as provided in paragraph (2), the members of 
agency boards shall be selected and appointed to serve in the 
same manner as hearing examiners appointed pursuant to section 
3105 of title 5 of the United States Code, with an additional 
requirement that such members shall have had not fewer than 
five years' experience in public contract law. Full-time 
members of agency boards serving as such on the effective date 
of this Act shall be considered qualified. The chairman and 
vice chairman of each board shall be designated by the agency 
head from members so appointed. Compensation for the chairman, 
the vice chairman, and all other members of an agency board 
shall be determined under section 5372a of title 5, United 
States Code.
  [(2) The Board of Directors of the Tennessee Valley Authority 
shall establish criteria for the appointment of members to its 
agency board of contract appeals established in subsection 
(a)(2), and shall designate a chairman of such board. The 
chairman and all other members of such board shall receive 
compensation, at the daily equivalent of the rates determined 
under section 5372a of title 5, United States Code, for each 
day they are engaged in the actual performance of their duties 
as members of the board.]
  (a) There is established in the Department of Defense a board 
of contract appeals to be known as the Department of Defense 
Board of Contract Appeals.
  (b) There is established in the General Services 
Administration a board of contract appeals to be known as the 
Civilian Board of Contract Appeals.
  [(c) If the volume of contract claims is not sufficient to 
justify an agency board under subsection (a) or if he otherwise 
considers it appropriate, any agency head shall arrange for 
appeals from decisions by contracting officers of his agency to 
be decided by a board of contract appeals of another executive 
agency. In the event an agency head is unable to make such an 
arrangement with another agency, he shall submit the case to 
the Administrator for placement with an agency board. The 
provisions of this subsection shall not apply to the Tennessee 
Valley Authority.]
  (d) [Each agency board shall have jurisdiction to decide any 
appeal from a decision of a contracting officer (1) relative to 
a contract made by its agency, and (2) relative to a contract 
made by any other agency when such agency or the Administrator 
has designated the agency board to decide the appeal.] The 
Defense Board shall have jurisdiction to decide any appeal from 
a decision of a contracting officer of the Department of 
Defense, the Department of the Army, the Department of the 
Navy, or the Department of the Air Force relative to a contract 
made by that department. The Civilian Board shall have 
jurisdiction to decide any appeal from a decision of a 
contracting officer of any executive agency (other than the 
Department of Defense or the Department of the Army, the Navy, 
or the Air Force) relative to a contract made by that agency. 
In exercising this jurisdiction, [the agency board] the Board 
concerned is authorized to grant any relief that would be 
available to a litigant asserting a contract claim in the 
United States Claims Court.
  (e) [An agency board shall provide] The Defense Board and the 
Civilian Board shall each provide, to the fullest extent 
practicable, informal, expeditious, and inexpensive resolution 
of disputes, and shall issue a decision in writing or take 
other appropriate action on each appeal submitted, and shall 
mail or otherwise furnish a copy of the decision to the 
contractor and the contracting officer.
  (f) The rules of [each agency board] the Defense Board and 
the Civilian Board shall include a procedure for the 
accelerated disposition of any appeal from a decision of a 
contracting officer where the amount in dispute is $100,000 or 
less. The accelerated procedure shall be applicable at the sole 
election of only the contractor. Appeals under the accelerated 
procedure shall be resolved, whenever possible, within one 
hundred and eighty days from the date the contractor elects to 
utilize such procedure.
  (g)(1) The decision of [an agency board of contract appeals] 
the Defense Board or the Civilian Board, as the case may be, 
shall be final, except that--
          (A) a contractor may appeal such a decision to the 
        United States Court of Appeals for the Federal Circuit 
        within one hundred twenty days after the date of 
        receipt of a copy of such decision, or
          (B) The agency head, if he determines that an appeal 
        should be taken, and with the prior approval of the 
        Attorney General, transmits the decision of the board 
        of contract appeals to the Court of Appeals for the 
        Federal Circuit for judicial review under section 1295 
        of title 28, United States Code, within one hundred and 
        twenty days from the date of the agency's receipt of a 
        copy of the board's decision.
  [(2) Notwithstanding the provisions of paragraph (1), the 
decision of the board of contract appeals of the Tennessee 
Valley Authority shall be final, except that--
          [(A) a contractor may appeal such a decision to a 
        United States district court pursuant to the provisions 
        of section 1337 of title 28, United States Code within 
        one hundred twenty days after the date of receipt of a 
        copy of such decision, or
          [(B) The Tennessee Valley Authority may appeal the 
        decision to a United States district court pursuant to 
        the provisions of section 1337 of title 28, United 
        States Code, within one hundred twenty days after the 
        date of the decision in any case.]
  [(3)] (2) An award by an arbitrator under this Act shall be 
reviewed pursuant to sections 9 through 13 of title 9, United 
States Code, except that the court may set aside or limit any 
award that is found to violate limitations imposed by Federal 
statute.
  [(h) Pursuant to the authority conferred under the Office of 
Federal Procurement Policy Act, the Administrator is authorized 
and directed, as may be necessary or desirable to carry out the 
provisions of this Act, to issue guidelines with respect to 
criteria for the establishment, functions, and procedures of 
the agency boards (except for a board established by the 
Tennessee Valley Authority).
  [(i) Within one hundred and twenty days from the date of 
enactment of this Act, all agency boards, except that of the 
Tennessee Valley Authority, of three or more full time members 
shall develop workload studies for approval by the agency head 
as specified in section 8(a)(1).]

                              small claims

  Sec. 9. (a) The rules of [each agency board] the Defense 
Board and the Civilian Board shall include a procedure for the 
expedited disposition of any appeal from a decision of a 
contracting officer where the amount in dispute is $50,000 or 
less. The small claims procedure shall be applicable at the 
sole election of the contractor.
  (b) The small claims procedure shall provide for simplified 
rules of procedure to facilitate the decision of any appeal 
thereunder. Such appeals may be decided by a single member of 
[the agency board] the Board concerned with such concurrences 
as may be provided by rule or regulation.
          * * * * * * *

          actions in court: judicial review of board decisions

  Sec. 10. (a)(1) [Except as provided in paragraph (2), and in] 
In lieu of appealing the decision of the contracting officer 
under section 6 to [an agency board] the Defense Board or the 
Civilian Board, a contractor may bring an action directly on 
the claim in the United States Claims Court, notwithstanding 
any contract provision, regulation, or rule of law to the 
contrary.
  [(2) In the case of an action against the Tennessee Valley 
Authority, the contractor may only bring an action directly on 
the claim in a United States district court pursuant to section 
1337 of title 28, United States Code, notwithstanding any 
contract provision, regulation, or rule of law to the 
contrary.]
  [(3)] (2) Any action under paragraph (1) [or (2)] shall be 
filed within twelve months from the date of the receipt by the 
contractor of the decision of the contracting officer 
concerning the claim, and shall proceed de novo in accordance 
with the rules of the appropriate court.
  (b) In the event of an appeal by a contractor or the 
Government from a decision of [any agency board] the Defense 
Board or the Civilian Board pursuant to section 8, 
notwithstanding any contract provision, regulation, or rules of 
law to the contrary, the decision of [the agency board] the 
Board concerned on any question of law shall not be final or 
conclusive, but the decision on any question of fact shall be 
final and conclusive and shall not be set aside unless the 
decision is fraudulent, or arbitrary, or capricious, or so 
grossly erroneous as to necessarily imply bad faith, or if such 
decision is not supported by substantial evidence.
  (c) In any appeal by a contractor or the Government from a 
decision of [an agency board] the Defense Board or the Civilian 
Board pursuant to section 8, the court may render an opinion 
and judgment and remand the case for further action by [the 
agency board] the Board concerned or by the executive agency as 
appropriate, with such direction as the court considers just 
and proper.
  (d) If two or more suits arising from one contract are filed 
in the Court of Claims and [one or more agency boards] the 
Defense Board or the Civilian Board (or both), for the 
convenience of parties or witnesses or in the interest of 
justice, the United States Claims Court may order the 
consolidation of such suits in that court or transfer any suits 
to [or among the agency boards involved] one or both of the 
Boards.
          * * * * * * *

                   subpena, discovery and deposition

  Sec. 11. A member of [an agency board of contract appeals] 
the Defense Board or the Civilian Board may administer oaths to 
witnesses, authorize depositions and discovery proceedings, and 
require by subpena the attendance of witnesses, and production 
of books and papers, for the taking of testimony or evidence by 
deposition or in the hearing of an appeal by the agency board. 
In case of contumacy or refusal to obey a subpena by a person 
who resides, is found, or transacts business within the 
jurisdiction of a United States district court, the court, upon 
application of [the agency board through the Attorney General; 
or upon application by the board of contract appeals of the 
Tennessee Valley Authority] the Defense Board or the Civilian 
Board, shall have jurisdiction to issue the person an order 
requiring him to appear before the agency board or a member 
thereof, to produce evidence or to give testimony, or both. Any 
failure of any such person to obey the order of the court may 
be punished by the court as a contempt thereof.
          * * * * * * *

                             appropriations

  Sec. 13. (a) * * *
  (b) Any monetary award to a contractor by [an agency board of 
contract appeals] the Defense Board or the Civilian Board shall 
be paid promptly in accordance with the procedures contained in 
subsection (a) above.
          * * * * * * *
  (d)(1) * * *
  (2) Notwithstanding the provisions of subsection (a) through 
(c), any monetary award to a contractor [by the board of 
contract appeals for] by the Defense Board or the Civilian 
Board from the Tennessee Valley Authority shall be paid in 
accordance with the provisions of section 9(b) of the Tennessee 
Valley Authority Act of 1933 (16 U.S.C. 831(h)).
          * * * * * * *
                              ----------                              

              SECTION 5372a OF TITLE 5, UNITED STATES CODE

Sec. 5372a. Contract appeals board members

  (a) For the purpose of this section--
          (1) the term ``contract appeals board member'' means 
        a member of [an agency board of contract appeals 
        appointed under section 8 of the Contract Disputes Act 
        of 1978] the Department of Defense Board of Contract 
        Appeals or the Civilian Board of Contract Appeals 
        appointed under section 202 of the Office of Federal 
        Procurement Policy Act; and
          (2) the term ``appeals board'' means [an agency board 
        of contract appeals established pursuant to section 8 
        of the Contract Disputes Act of 1978] the Department of 
        Defense Board of Contract Appeals or the Civilian Board 
        of Contract Appeals.
          * * * * * * *
                      IX. Committee Recommendation

    On July 27, 1995, a quorum being present, the Committee 
ordered the bill favorably reported.

 committee on government reform and oversight--104th congress rollcall

    Date: July 27, 1995.
    Amendment No. 1.
    Description: Amendment in the Nature of a Substitute.
    Offered By: Mr. Clinger.
    Voice Vote: Ayes.
    Date: July 27, 1995.
    Final Passage of H.R. 1670.
    Offered By: Mr. Horn.
    Voice Vote: Ayes.

    X. Congressional Accountability Act; Public Law 104-1; Section 
                               102(b)(3)

    This provision is inapplicable to the legislative branch 
because it does not relate to any terms or conditions of 
employment or access to public services or accommodations.
                   XI. MINORITY AND ADDITIONAL VIEWS

                              ----------                              


                             MINORITY VIEWS

    The Committee on Government Reform and Oversight met on 
Thursday, July 27, 1995, and marked-up H.R. 1670, the Federal 
Acquisition Reform Act of 1995. The Committee Report reflects 
the fact that Chairman Clinger offered an amendment in the 
nature of a substitute, which was favorably reported to the 
House by voice vote.
    However, the report does not reflect the concerns expressed 
at the mark-up by Democrats that small business may be placed 
at a significant competitive disadvantage by the bill's change 
in the ``full and open'' competition standard. Neither does the 
report reflect the fact that the Democrats did not oppose the 
bill in the committee because of a promise by Chairman Clinger 
to continue to review the impact upon small business, and to 
support our right to offer an amendment on the House floor to 
correct the bill.
    We were only able to examine new changes to H.R. 1670 two 
days before the bill was marked-up. It, after a more careful 
analysis of the new competition language and after consultation 
with small business it continues to appear that small business 
will be disadvantaged by the change in the ``full and open 
competition'' standard, we will offer an amendment on the floor 
to ensure a level playing field for small business.
    Our difference with H.R. 1670 is that we want to preserve 
full and open competition in procurement. It is an important 
principle to ensure that every business, old and new, large and 
small, has a fair chance to compete for government contracts. 
We know from experience if you allow government bureaucrats to 
limit competition, they will invariably do so. We would most 
certainly return to a ``old boy network'' in which only the 
large and established companies can successfully compete.
    At the same time we should note our support for the 
overwhelming majority of H.R. 1670. Generally, the bill 
contains changes that are consistent with the streamlining 
efforts we made less than a year ago, with the most 
comprehensive government-wide acquisition reform act in over a 
decade, the Federal Acquisition Streamlining Act of 1994, known 
as FASA.

                       defense authorization bill

    Despite objections from the committee Democrats, the 
Committee on Rules made H.R. 1670 in order as an amendment on 
the Defense Authorization bill. Prior to floor consideration of 
that amendment, the Ranking Democratic Member of the full 
committee, Rep. Cardiss Collins, and the ranking Democratic 
Member of the Government Information and Technology 
Subcommittee, Representative Maloney, attempted to work with 
Chairman Clinger to improve his amendment. Chairman Clinger 
accepted four of our five concerns. As a result of these 
changes, the modified Clinger amendment was a substantial 
improvement over the original amendment.
    The first of our changes accepted by Chairman Clinger 
improved the government procurement management practices, by 
requiring Federal agencies to make more effective use of the 
cost-management tools and procedures known generally as Value 
Engineering. Value engineering is a long-standing and widely-
accepted technique in both the public and private sectors that, 
despite its proven capabilities, remains under-utilized in the 
Federal acquisition process.
    Our second change retains the ``knowing'' standard for 
criminal violations of our procurement integrity laws, and 
increases the maximum criminal penalty from 5 to 15 years. This 
change will facilitate the Justice Department's ability to 
prosecute criminal and civil procurement fraud cases.
    Third, Chairman Clinger accepted our change to limit sole-
source contracting for commercial products. While we believe 
that the complete elimination of the simplified acquisition 
threshold contained in the Clinger amendment will raise 
problems, our amendment will place limits on its use and will 
help to ensure that an adequate level of competition is 
maintained with the expanded use of commercial items.
    Finally, Chairman Clinger accepted an amendment by 
Representative Maloney that improves the performance capability 
of the frontline contracting personnel. The Maloney language 
requires civilian agency heads to adopt education, training and 
incentive features that raise the level of excellence and 
professionalism of the acquisition work force.
    The one change that Chairman Clinger did not accept was our 
``full and open'' competition amendment. Our amendment did 
three things: First it retained the current full and open 
competition standard. Second, it eliminated an unnecessary 
system of Federal agency verification, whereby agency 
bureaucrats determine which firms are allowed to bid for 
Federal contracts. Third, it moves us closer to commercial 
buying practices, by empowering agency officials to have more 
open communication with the private sector. Rep. Cardiss 
Collins offered this amendment on the floor.
    The Collins amendment passed on June 14, 1995 with 
bipartisan support, and then Chairman Clinger's amendment, as 
amended, passed by a truly bipartisan vote of 420-1.

                            committee markup

    A Committee markup and scheduled for Thursday, July 27, 
1995. Prior to the committee markup, Chairman Clinger made an 
effort to move H.R. 1670 closer to the concept of full and open 
competition which passed with bipartisan support on the House 
floor as a part of the Defense Authorization bill.
    In Title I in the Clinger substitute, the term ``full and 
open competition'' has been included in the text. However, its 
meaning is substantively changed from the language in the 
Collins amendment, that passed on the House floor. The Collins 
``full and open competition'' language has been replaced by 
``open access'', the definition of which is identical to the 
definition of ``full and open'' in the Competition in 
Contracting Act. However, a subsequent provision of the bill 
creates large loopholes through which bureaucrats may be able 
to ignore full competition, and instead more easily limit 
competition.
    For example, the new section 2304(d), entitled ``PROCEDURES 
OTHER THAN COMPETITIVE PROCEDURES'' states that ``Procedures 
other than competitive procedures may be used for purchasing 
property and services only when the use of competitive 
procedures is not feasible or appropriate.'' Standards for 
determining what is feasible or appropriate will be written by 
the procurement officers, and the procurement officers must 
justify their decision in writing. It is impossible to know 
whether those new standards will hamstring small business 
because there has never been such a broad exception to full and 
open competition.
    The hearing record of H.R. 1670 does not establish any 
problems with the current ``full and open competition'' 
standard. The cornerstone of our free enterprise system is full 
and open competition. The competitive market ensures fair 
prices to the government. If a vendor's product costs too much 
it will not survive. At the same time full and open competition 
provides the opportunity for all vendors, particularly small 
businesses, to participate in the Federal marketplace, to be 
judged on merit. This creates incentives for the development of 
new and innovative products. These market forces are essential 
if we are to position our country for economic leadership into 
the next century.
    Small businesses may be threatened by the change in 
competition standard. Maybe they won't. At this stage we just 
don't know, because the language has not been thoroughly 
circulated for comments. We have held no hearings on the new 
provisions. Affected businesses have not been consulted.
    Preliminary indications are that small business believes 
that Chairman Clinger's revised competition standard is a 
problem for small business. Representative Maloney entered into 
the record a letter sent to Chairman Clinger, and signed by the 
U.S. Chamber of Commerce and the Small Business Working Group 
on Procurement Reform, which includes the Small Business 
Legislative Council, National Small Business United, the 
National Association of Women Business Owners, the Latin 
American Management Association, the Minority Business 
Enterprise Legal Defense and Education Fund, the National 
Association of Minority Business, the National Association of 
Minority Contractors, and Women Construction Owners and 
Executives and the American Gear Manufacturers Association. The 
letter indicates that the organizations have serious and 
substantial objectives to the new competition standard in Title 
I, and concerns were expressed regarding the unseen bid protest 
language in Title IV.
                                   Cardiss Collins.
                                   Carolyn B. Maloney.
                       ADDITIONAL MINORITY VIEWS

    If enacted, H.R. 1670 would make sweeping changes in the 
current Federal procurement system. It would do this by 
changing the basic competition standard required of Federal 
agencies when purchasing goods or services. While the 
Chairman's genuine commitment to procurement reform is 
commendable, I continue to have serious reservations about this 
fundamental transformation of Federal acquisition law. The 
Federal government spends over $200 billion per year on the 
acquisition of goods and services--$800 for every person in the 
United States. Especially in an era of every-tightening fiscal 
constraint, if we want to control spending and better manage 
our limited resources, there are few areas of the Federal 
government that are more important.
    The House of Representatives has already taken a position 
supporting the current standard of full and open competition by 
adopting Ranking Member Collins' amendment to Chairman's 
Clinger amendment to H.R. 1530, the National Defense 
Authorization bill. The July 10th version of H.R. 1670 replaced 
``full and open competition.'' With ``open access,'' and 
defined ``open access'' identically to ``full and open 
competition.'' In the July 19th version of H.R. 1670, both 
terms are used in the new standard. On its surface then, the 
final version of H.R. 1670 appears to maintain the current 
standard by directing the government to ``obtain full and open 
competition.'' However, in practical effect this language 
restricts full and open competition because the directive to 
``obtain full and open competition'' is modified by ``that is 
consistent with the need to efficiently fulfill the 
Government's requirements.'' Full and open competition is also 
substantially restricted by allowing the contracting officer 
greater discretion as to when other than competitive procedures 
may be used. This is discussed more fully below.
    The case that the full and open competition standard needs 
to be changed has yet to be made in a credible and coherent 
fashion. It was not raised during the Committee's February 28, 
1995 hearing on procurement reform. At the joint Government 
Reform and Oversight/National Security Committee hearing 
witnesses did not address the fundamental question of whether 
the Federal government should move away from the full and open 
competition standard, but rather testified on the specific 
language of H.R. 1670 at that time, i.e. ``maximum 
practicable'' competition.
    Abandonment of the full and open competition standard has 
not been recommended by any recent authoritative study of the 
Federal procurement system. Indeed, the so-called Section 800 
Panel, whose 1800 page report provided the analytical basis for 
last year's landmark Federal Acquisition Streamlining Act, 
considered and explicitly rejected moving away from full and 
open competition. In addition, changing the full and open 
competition standard is vigorously opposed by the small 
business community. In a letter to Chairman Clinger dated July 
27th, the Small Business Working Group on Procurement Reform 
and the U.S. Chamber of Commerce wrote ``we believe that it is 
essential that H.R. 1670 be modified to maintain the current 
standard of `full and open competition', established by the 
landmark Competition in Contracting Act of 1984 (CICA) * * *. 
The competitive standard established by CICA has proven itself 
for over a decade, resulting in a steady decrease in sole 
source contract awards. It assures a fair and open procurement 
process, which is essential to small business.''
    H.R. 1670 also substantially broadens the contracting 
officer's authority to award contracts through other than 
competitive procedures. CICA established seven statutory 
exceptions that would justify the use of other than competitive 
procedures and required that their use be justified and 
approved. H.R. 1670 retains these exceptions, but applies them 
only when a contract is done on a sole source basis, 
significantly weakening their effect. In addition, H.R. 1670 
adds two new and extremely broad exceptions to competition, 
allowing use of other than competitive procedures when those 
procedures are not ``feasible or appropriate.'' The bill leaves 
the definition of these exceptions to the Federal Acquisition 
Regulation. At the very least, there should be some statutory 
definition of these terms.
    The concern most frequently cited by industry 
representatives and the sponsors of H.R. 1670 with respect to 
the Federal procurement system center around the desire, at 
some point early in the process, to limit the competitive 
range. For businesses, this will save time and money by letting 
them know early that they have little chance of winning the 
contract. For the government, this ability would lead to 
greater efficiency and cost-savings. This problem can be 
addressed by improving communication between vendors and the 
government, and by modifying current law to make explicit the 
ability of the contracting officer to establish an initial 
competitive range and eliminate those offers that are clearly 
unacceptable. This can be done without changing the full and 
open competition standard that has been in effect for over a 
decade.
    Title II (Commercial Items) of H.R. 1670 includes a 
provision which would allow the purchase of commercial items 
with the use of ``simplified procedures'' without any dollar 
value limitation. Currently, such procedures can be used only 
for small (under $25,000). When FASA is fully implemented later 
this year, that threshold will rise to $100,000. At that level, 
over 90% of all commercial item procurements will be able to 
use streamlined procedures. The small business community 
continues to be concerned that these streamlined procedures 
encourage the use of ``telephone call competitions'' in which 
three phone calls would constitute competition. Abolishing any 
threshold at this time is unwise, especially since the 
definition of ``commercial item'' included in FASA is very 
broad. We should wait until we have had time to analyze the 
effects of the $100,000 threshold before lifting it all 
together.

                                   Carolyn B. Maloney.
                            ADDITIONAL VIEWS

    During the mark-up, an amendment was offered by Rep. 
Zeliff, and later withdrawn. The amendment would repeal section 
1555 of the Federal Acquisition Streamlining Act of 1994, which 
authorizes GSA to allow State and local government entities to 
purchase goods and services under GSA's Federal Supply Schedule 
contract program. It is known as the Cooperative Purchasing 
Program.
    Before Rep. Zeliff withdrew his amendment, I offered my 
support for the amendment and requested that a statement 
regarding the intent of the amendment appear in the committee 
report.
    The Cooperative Purchasing Program has not yet been 
implemented by GSA. But considerable objections have been heard 
from small businesses and local dealers about the difficulties 
the program would present for them. GSA's market power would 
give companies listed through GSA catalogs an incredible 
competitive advantage. Those companies not listed, particularly 
small manufacturers and local wholesalers and distributors, 
could be squeezed out of the municipal and state marketplaces.
    The Zeliff amendment does not appear to interfere with 
other programs under which state and local governments may 
acquire Government property, such as recent legislation 
allowing state and local government to purchase police 
equipment through the Department of Defense.
                                   Bob Wise.