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LEGISLATIVE PROVISIONS NOT ADOPTED

From House Conference Report

Sections of House and Senate Bills Not Enacted

SEC. 850. ADDITIONAL INFORMATION ON WAIVERS UNDER THE BUY AMERICAN ACT BY DEPARTMENT OF DEFENSE REQUIRED TO BE INCLUDED IN ANNUAL REPORT.

Section 812 of the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136; 10 U.S.C. 2501 note) is amended in subsection (c)(2)(A) by striking clause (vi) and inserting the following:

`(vi) An itemized list of all waivers granted with respect to such articles, materials, or supplies under chapter 83 of title 41 (commonly referred to as the Buy American Act), including--

`(I) an analysis of the domestic capacity to supply the articles, materials, or supplies; and

`(II) an analysis of the reasons for an increase or decrease in the number of waivers granted from fiscal year to fiscal year.'.

The conferees expect the Department of Defense (DOD) to manage its business operations in an efficient manner. At the same time, the conferees understand that the consolidation of contracts for base services and construction can have a detrimental impact on the ability of small businesses to compete for such contracts. This issue has been addressed by Congress in the Small Business Jobs Act of 2010 (Public Law 111-240), the Small Business Reauthorization Act of 1997 (Public Law 105-135), the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136).

The conferees direct the Comptroller General to review DOD's compliance with provisions of law and regulation addressing contract consolidation and bundling with regard to contracts for base services and construction. The Comptroller General's report should address the scope of consolidation or bundling undertaken by the Department, the justification provided for such consolidation or bundling, and the impact of such consolidation or bundling on contracting with small business concerns. The report should also address associated issues, including the need for training, the availability of alternative contracting approaches, and any recommendations the Comptroller General may have to improve the Department's performance in this area.

SEC. 851. ASSESSMENT OF DEPARTMENT OF DEFENSE CONTRACTING ACTIONS AND THE IMPACT ON SMALL BUSINESSES.

(a) Assessment Required- The Inspector General of the Department of Defense shall conduct an assessment of consolidated contracting actions of the Department of Defense relating to base services and construction activities from October 2009 through October 2011 to ensure the Department's compliance with the provisions of the Small Business Jobs Act of 2010 (Public Law 111-240). The assessment shall, at a minimum, examine--

(1) compliance with the Small Business Jobs Act of 2010 (Public Law 111-240), the Small Business Reauthorization Act of 1997 (Public Law 105-135), the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136) and all relevant provisions in the Federal Acquisition Regulation and the Defense Federal Acquisition Regulation Supplement;

(2) justification for contract consolidation;

(3) scope of services provided by category, contract award ceiling, and period of performance;

(4) identification of any shortages in trained acquisition personnel that may have contributed to a determination to consolidate contracting actions;

(5) potential for alternative contracting approaches that would increase small business participation;

(6) any negative impact by such contract consolidations on contracting with small business concerns; and

(7) recommendations to improve or enhance Department of Defense policy, guidance, or execution of contracting actions to ensure compliance with the Small Business Jobs Act of 2010.

(b) Briefing- The Inspector General shall brief the congressional defense committees on the findings of the assessment required under subsection (a) not later than April 1, 2012.

SEC. 833. COMPTROLLER GENERAL ASSESSMENT OF GOVERNMENT COMPETITION IN THE DEPARTMENT OF DEFENSE INDUSTRIAL BASE.

(a) Comptroller General Assessment Required- The Comptroller General of the United States shall carry out an assessment of the effect of Government mandated and supported competition in the Department of Defense industrial base that includes, at a minimum, the following:

(1) An examination of the aerospace propulsion business volume that the Department generates and whether such volume facilitates or supports multiple levels of competitors.

(2) An examination of the factors necessary to achieve cost effectiveness in initiating and supporting a competitive industrial base.

(3) An examination of the actual costs of developing a second source for previous private sector provided materials versus savings provided through such competitions.

(4) The advantages and disadvantages of other potential options or methods as well as any shortfalls in the current processes.

(5) Recommendations for any administrative or legislative action that the Comptroller General deems appropriate in the context of the assessment.

(b) Report- Not later than April 1, 2012, the Comptroller General shall submit to the Chairmen and ranking members of the Committees on Armed Services of the Senate and the House of Representatives a report on the findings and recommendations, as appropriate, of the Comptroller General with respect to the assessment conducted. The Comptroller General shall receive comments from the Secretary of Defense and others, as appropriate.

SEC. 850. COMPTROLLER GENERAL OF THE UNITED STATES REPORTS ON DEPARTMENT OF DEFENSE IMPLEMENTATION OF JUSTIFICATION AND APPROVAL REQUIREMENTS FOR CERTAIN SOLE-SOURCE CONTRACTS.

Not later than 90 days after March 1, 2012, and March 1, 2013, the dates on which the Department of Defense submits to Congress a report on its implementation of section 811 of the Fiscal Year 2010 National Defense Authorization Act, the Comptroller General of the United States shall submit to the congressional defense committees a report setting forth an assessment of the extent to which the implementation of such section 811 by the Department ensures that sole-source contracts are awarded in applicable procurements only when those awards have been determined to be in the best interest of the Department.

SEC. 847. COMPTROLLER GENERAL OF THE UNITED STATES REPORTS ON NONCOMPETITIVE AND ONE-OFFER CONTRACTS AWARDED BY THE DEPARTMENT OF DEFENSE.

(a) Reports Required- Not later than March 31 of each of 2013, 2014, and 2015, the Comptroller General of the United States shall submit to the Committees on Armed Services of the Senate and the House of Representatives a report setting forth a review and assessment by the Comptroller General of the noncompetitive contracts and one-offer contracts awarded by the Department of Defense during the preceding fiscal year.

(b) Elements- Each report under subsection (a) shall include the following:

(1) The number of noncompetitive contracts awarded by the Department of Defense during the fiscal year covered by such report, and the percentage of such number to the total number of contracts awarded by the Department during such fiscal year.

(2) A description of the competition exceptions that served as the basis for the award of such noncompetitive contracts.

(3) An assessment of the adequacy of the justification and approvals issued under section 2304(f) of title 10, United States Code, in support of such noncompetitive contracts.

(4) The number of one-offer contracts awarded by the Department during the fiscal year covered by such report, and the percentage of such number to the total number of contracts awarded by the Department during such fiscal year.

(5) An assessment of the extent to which such one-offer contracts were awarded in compliance with applicable Department guidance on one-offer contracts.

(6) An assessment whether the contracting practices of the Department during the fiscal year covered by such report were in keeping with the objective of promoting full and open competition in the award of contracts in excess of the simplified acquisition threshold.

(c) Definitions- In this section:

(1) The term `competitive procedures' has the meaning given that term in section 2302(2) of title 10, United States Code.

(2) The term `noncompetitive contract' means a contract awarded through other than competitive procedures.

(3) The term `one-offer contract' means a contract awarded after receiving a bid from only one qualified vendor.

SEC. 824. DEFINITIONS.

In this subtitle:

(1) CONTRACT IN SUPPORT OF A CONTINGENCY OPERATION IN IRAQ OR AFGHANISTAN- The term `contract in support of a contingency operation in Iraq or Afghanistan' means a contract awarded by the Secretary of Defense for the procurement of property or services to be used outside the United States in support of a contingency operation in Iraq or Afghanistan.

(2) CONTINGENCY OPERATION- The term `contingency operation' has the meaning provided by section 101(a)(13) of title 10, United States Code.

(3) RECORDS- The term `records' has the meaning provided by section 2313(l) of title 10, United States Code.

(4) FOREIGN CONTRACTOR- The term `foreign contractor' means a contractor or subcontractor organized or existing under the laws of a country other than the United States.

SEC. 844. EXEMPTION OF DEPARTMENT OF DEFENSE FROM ALTERNATIVE FUEL PROCUREMENT REQUIREMENT.

Section 526 of the Energy Independence and Security Act of 2007 (Public Law 110-140; 42 U.S.C. 17142) is amended by adding at the end the following: `This section shall not apply to the Department of Defense.'.

SEC. 885. EXTENSION AND EXPANSION OF SMALL BUSINESS PROGRAMS OF THE DEPARTMENT OF DEFENSE.

(a) Extension of SBIR Program- Section 9(m)(2) of the Small Business Act (15 U.S.C. 638(m)(2)) is amended by striking `September 30, 2010' and inserting `September 30, 2018'.

(b) Extension of STTR Program- Section 9(n)(1)(A)(ii) of the Small Business Act (15 U.S.C. 638(n)(1)(A)(ii)) is amended by striking `2010' and inserting `2018'.

(c) Extension and Expansion of Commercialization Pilot Program- Section 9(y) of the Small Business Act (15 U.S.C. 638(y)) is amended--

(1) in paragraphs (1), (2), and (4), by inserting `and the Small Business Technology Transfer Program' after `Small Business Innovation Research Program'; and

(2) in paragraph (6), by striking `2010' and inserting `2018'.

SEC. 816. PARA-ARAMID FIBERS AND YARNS.

(a) Repeal of Foreign Supplier Exemption- Section 807 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (Public Law 105-261; 112 Stat. 2084) is repealed.

(b) Prohibition on Specification in Solicitations- No solicitation issued by the Department of Defense may include a requirement that proposals submitted pursuant to such solicitation must include the use of para-aramid fibers and yarns.

SEC. 842. PROCUREMENT OF PHOTOVOLTAIC DEVICES.

(a) Revision to Contracts Described- Subsection (b) of section 846 of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011 (Public Law 111-383; 124 Stat. 4285; 10 U.S.C. 2534 note) is amended by striking `For the purposes of this section,' and all that follows through the end and inserting the following: `For the purposes of this section, the Department of Defense is deemed to own a photovoltaic device if the device is installed on Department of Defense property or in a facility owned or leased by or for the Department of Defense.'.

(b) Revision to Definition of Photovoltaic Devices- Subsection (c) of such section is amended by striking `means' and all that follows through the end and inserting the following: `means devices that convert light directly into electricity.'.

SEC. 827. APPLICABILITY OF BUY AMERICAN ACT TO PROCUREMENT OF PHOTOVOLTAIC DEVICES BY DEPARTMENT OF DEFENSE.

(a) In General- Section 2534 of title 10, United States Code, is amended by adding at the end the following new subsection:

`(k) Procurement of Photovoltaic Devices-

`(1) CONTRACT REQUIREMENT- The Secretary of Defense shall ensure that each contract described in paragraph (2) awarded by the Department of Defense includes a provision requiring any photovoltaic devices installed pursuant to the contract, or pursuant to a subcontract under the contract, to comply with the provisions of chapter 83 of title 41 (commonly known as the `Buy American Act'), without regard to whether the contract results in ownership of the photovoltaic devices by the Department.

`(2) CONTRACTS DESCRIBED- The contracts described in this paragraph include energy savings performance contracts, utility service contracts, power purchase agreements, land leases, and private housing contracts pursuant to which any photovoltaic devices are--

`(A) installed on property or in a facility owned by the Department of Defense; and

`(B) generate power consumed predominantly by the Department of Defense and counted toward federal renewable energy purchase requirements.

`(3) CONSISTENCY WITH INTERNATIONAL OBLIGATIONS- Paragraph (1) shall be applied in a manner consistent with the obligations of the United States under international agreements.

`(4) DEFINITION OF PHOTOVOLTAIC DEVICES- In this subsection, the term `photovoltaic devices' means devices that convert light directly into electricity.

`(5) EFFECTIVE DATE- This subsection applies to photovoltaic devices procured or installed on or after the date that is 30 days after the date of the enactment of the National Defense Authorization Act for Fiscal Year 2012 pursuant to contracts entered into or after such date of enactment.'.

(b) Conforming Repeal- Section 846 of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011 (10 U.S.C. 2534 note) is repealed.

SEC. 826. PROHIBITION ON USE OF FUNDS FOR CERTAIN PROGRAMS.

No amounts authorized to be appropriated by this Act may be obligated or expended to implement or carry out any program that creates a price evaluation adjustment as described in section 2323(e)(3) of title 10, United States Code, or any other authority, that is inconsistent with the holdings in the following:

(1) Adarand Constructors, Inc. v. Pen.AE6a, 515 U.S. 200 (1995).

(2) Rothe Development Corporation. v. Department of Defense, 545 F.3d 1023 (2008).

SEC. 825. QUALITY ASSURANCE SURVEILLANCE PLAN FOR SECURITY CONTRACTORS OPERATING IN AFGHANISTAN AND IN SUPPORT OF OTHER CONTINGENCY OPERATIONS.

(a) In General- The Secretary of Defense shall establish a plan to be known as a `Quality Assurance Surveillance Plan' setting standards that must be incorporated in Department of Defense oversight plans governing all security contractors operating in Afghanistan, and other future contingency operations, under a contract or subcontract funded by the Department of Defense. The Secretary shall designate a single appropriate official stationed in the country of operations to review each security contract or subcontract involving security contractors funded by the Department of Defense for compliance with the Quality Assurance Surveillance Plan. Such official shall certify that the official has reviewed the oversight plan for that contract, that the oversight plan is appropriate for that contract, that there is an appropriate number of appropriately trained personnel available to oversee that contract, and confirm that any and all licenses and permits required by the security contractor and its employees have been reviewed and verified as current and authentic.

(b) Deadline for Implementation- These requirements under subsection (a) shall be implemented by not later than six months after the date of enactment of this Act.

(c) Comptroller General Assessment- The Comptroller General of the United States shall conduct an assessment the Department of Defense's compliance with this section and, not later than 6 months after the requirements of this section are implemented pursuant to subsection (b), shall submit to Congress a report on such assessment.

SEC. 834. REPORT ON IMPACT OF FOREIGN BOYCOTTS ON THE DEFENSE INDUSTRIAL BASE.

(a) In General- Not later than February 1, 2012, the Comptroller General of the United States shall submit to the appropriate congressional committees a report setting forth an assessment of the impact of foreign boycotts on the defense industrial base.

(b) Elements- The report required by subsection (a) shall include--

(1) a summary of foreign boycotts that posed a material risk to the defense industrial base from January 2008 to the date of enactment of this Act;

(2) the apparent objectives of each such boycott;

(3) an assessment of harm to the defense industrial base as a result of each such boycott;

(4) an assessment of the sufficiency of Department of Defense and Department of State efforts to mitigate the material risks of any such boycott to the defense industrial base; and

(5) recommendations of the Comptroller General to reduce the material risks of foreign boycotts to the defense industrial base, including recommendations for changes to legislation, regulation, policy, or procedures.

(c) Confidentiality- The Comptroller General shall not publicly disclose the names of any person, organization, or entity involved in or affected by any foreign boycott identified in the report required under subsection (a) without the express written approval of the person, organization, or entity concerned.

(d) Definitions- In this section:

(1) FOREIGN BOYCOTT- The term `foreign boycott' means any policy or practice adopted by a foreign government or foreign business enterprise intended to directly penalize, disadvantage, or harm any contractor or subcontractor of the Department of Defense, or otherwise dissociate the foreign government or foreign business enterprise from such a contractor or subcontractor on account of the provision by that contractor or subcontractor of any product or service to the Department.

(2) APPROPRIATE CONGRESSIONAL COMMITTEES- The term `appropriate congressional committees' means--

(A) the congressional defense committees; and

(B) the Committee on Foreign Affairs of the House of Representatives and the Committee on Foreign Relations of the Senate.

SEC. 892. REPORT ON IMPACT OF FOREIGN BOYCOTTS ON THE DEFENSE INDUSTRIAL BASE.

(a) In General- Not later than October 1, 2012, the Department of Defense shall submit to the appropriate congressional committees a report setting forth an assessment of the impact of foreign boycotts on the defense industrial base.

(b) Element- The report required by subsection (a) shall include a summary of foreign boycotts that posed a material risk to the defense industrial base from January 2008 to the date of the enactment of this Act.

(c) Definitions- In this section:

(1) FOREIGN BOYCOTT- The term `foreign boycott' means any policy or practice adopted by a foreign government or foreign business enterprise intended to penalize, disadvantage, or harm any contractor or subcontractor of the Department of Defense on account of the provision by that contractor or subcontractor of any product or service to the Department.

(2) APPROPRIATE CONGRESSIONAL COMMITTEES- The term `appropriate congressional committees' means--

(A) the congressional defense committees; and

(B) the Committee on Foreign Relations of the Senate and the Committee on Foreign Affairs of the House of Representatives.

SEC. 846. REPORTS ON USE OF INDEMNIFICATION AGREEMENTS.

(a) In General- Chapter 137 of title 10, United States Code, is amended by adding at the end the following:

`Sec. 2335. Reports on use of indemnification agreements

`(a) In General- Beginning October 1, 2011, not later than 90 days after the date on which any action described in subsection (b)(1) occurs, the Secretary of Defense shall submit to the congressional defense committees and the Committees on the Budget of the House of Representatives and the Senate a report on such action.

`(b) Action Described- (1) An action described in this paragraph is the Secretary of Defense--

`(A) entering into a contract that includes an indemnification agreement; or

`(B) modifying an existing indemnification agreement in any contract.

`(2) Paragraph (1) shall not apply to any contract awarded in accordance with--

`(A) section 2354 of this title; or

`(B) the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. 9601 et seq.).

`(c) Matters Included- For each contract covered in a report under subsection (a), the report shall include--

`(1) the name of the contractor;

`(2) the actual cost or estimated potential cost involved;

`(3) a description of the items, property, or services for which the contract is awarded; and

`(4) a justification of the contract including the indemnification agreement.

`(d) National Security- The Secretary may omit any information in a report under subsection (a) if the Secretary--

`(1) determines that the disclosure of such information is not in the national security interests of the United States; and

`(2) includes in the report a justification of the determination made under paragraph (1).'.

(b) Clerical Amendment- The table of sections at the beginning of such chapter is amended by adding at the end the following new item:

`2335. Reports on use of indemnification agreements.'.

SEC. 804. SUPPLIER RISK MANAGEMENT.

(a) Supplier Risk Management- In order to reduce waste, fraud, and abuse and ensure that the Department of Defense awards contracts to responsible suppliers, the Secretary of Defense shall manage supplier risk in accordance with this section and with the requirements of section 8(b)(7) of the Small Business Act (15 U.S.C. 637(b)(7)).

(b) Evaluation of Supplier Risk Before Award of Contract- The Secretary shall direct contracting personnel to use a business credit reporting bureau (or such other objective source of business information as the Secretary considers appropriate) to evaluate supplier risk on all contract actions.

(c) Identification and Tracking of Suppliers After Award of Contract- The Secretary shall ensure that existing suppliers, including subcontractors and sources of supply, are identified and tracked. In implementing this subsection, the Secretary shall use an automated commercial-off-the-shelf product to identify suppliers by location and to monitor suppliers for events that may affect supplier performance, including debarments and suspensions, mergers and acquisitions, bankruptcy filings, criminal proceedings against a person or company, financial changes, or deterioration of a company.

SEC. 846. WAIVER OF `BUY AMERICAN' REQUIREMENT FOR PROCUREMENT OF COMPONENTS OTHERWISE PRODUCIBLE OVERSEAS WITH SPECIALTY METAL NOT PRODUCED IN THE UNITED STATES.

Section 2533b of title 10, United States Code, is amended--

(1) by redesignating subsections (l) and (m) as subsections (m) and (n), respectively; and

(2) by inserting after subsection (k) the following new subsection (l):

`(l) Additional Waiver Authority- (1) The Secretary of Defense may waive the requirement of subsection (a) with regard to the procurement of a component containing specialty metal if the Secretary determines that, in the absence of the waiver, the component will be produced overseas and will contain specialty metal not melted or produced in the United States.

`(2) The Secretary shall establish a process to review petitions for waivers under this subsection by interested persons. The process shall include an opportunity for comment by persons engaged in melting or producing specialty metals in the United States.

`(3) The authority to grant a waiver under paragraph (1) may be delegated to any civilian official in the Department of Defense or a military department who is appointed by the President, by and with the advice and consent of the Senate.'.