USC Chapter 146

USC Chapter 146
in effect

10 U.S.C. § 2460 Definition of depot-level maintenance and repair

(a) In General.—In this chapter, the term “depot-level maintenance and repair” means (except as provided in subsection (b)) material maintenance or repair requiring the overhaul, upgrading, or rebuilding of parts, assemblies, or subassemblies, and the testing and reclamation of equipment as necessary, regardless of the source of funds for the maintenance or repair or the location at which the maintenance or repair is performed. The term includes (1) all aspects of software maintenance classified by the Department of Defense as of July 1, 1995, as depot-level maintenance and repair, and (2) interim contractor support or contractor logistics support (or any similar contractor support), to the extent that such support is for the performance of services described in the preceding sentence. (b) Exceptions.—(1) The term does not include the procurement of major modifications or upgrades of weapon systems that are designed to improve program performance or the nuclear refueling or defueling of an aircraft carrier and any concurrent complex overhaul. A major upgrade program covered by this exception could continue to be performed by private or public sector activities. (2) The term also does not include the procurement of parts for safety modifications. However, the term does include the installation of parts for that purpose.

10 U.S.C. § 2461 Public-private competition required before conversion to contractor performance

(a) Public-Private Competition.—(1) No function of the Department of Defense performed by Department of Defense civilian employees may be converted, in whole or in part, to performance by a contractor unless the conversion is based on the results of a public-private competition that—(A) formally compares the cost of performance of the function by Department of Defense civilian employees with the cost of performance by a contractor; (B) creates an agency tender, including a most efficient organization plan, in accordance with Office of Management and Budget Circular A–76, as implemented on May 29, 2003, or any successor circular; (C) includes the issuance of a solicitation; (D) determines whether the submitted offers meet the needs of the Department of Defense with respect to factors other than cost, including quality, reliability, and timeliness; (E) examines the cost of performance of the function by Department of Defense civilian employees and the cost of performance of the function by one or more contractors to demonstrate whether converting to performance by a contractor will result in savings to the Government over the life of the contract, including—(i) the estimated cost to the Government (based on offers received) for performance of the function by a contractor; (ii) the estimated cost to the Government for performance of the function by Department of Defense civilian employees; and (iii) an estimate of all other costs and expenditures that the Government would incur because of the award of such a contract; (F) requires continued performance of the function by Department of Defense civilian employees unless the difference in the cost of performance of the function by a contractor compared to the cost of performance of the function by Department of Defense civilian employees would, over all performance periods required by the solicitation, be equal to or exceed the lesser of—(i) 10 percent of the personnel-related costs for performance of that function in the agency tender; or (ii) $10,000,000; (G) requires that the contractor shall not receive an advantage for a proposal that would reduce costs for the Department of Defense by—(i) not making an employer-sponsored health insurance plan (or payment that could be used in lieu of such a plan), health savings account, or medical savings account available to the workers who are to be employed to perform the function under the contract; (ii) offering to such workers an employer-sponsored health benefits plan that requires the employer to contribute less towards the premium or subscription share than the amount that is paid by the Department of Defense for health benefits for civilian employees of the Department under chapter 89 of title 5; or (iii) offering to such workers a retirement benefit that, in any year, costs less than the annual retirement cost factor applicable to civilian employees of the Department of Defense under chapter 84 of title 5; and (H) examines the effect of performance of the function by a contractor on the military mission associated with the performance of the function. (2) A function that is performed by the Department of Defense and is reengineered, reorganized, modernized, upgraded, expanded, or changed to become more efficient, but still essentially provides the same service, shall not be considered a new requirement. (3) In no case may a function being performed by Department of Defense personnel be—(A) modified, reorganized, divided, or in any way changed for the purpose of exempting the conversion of the function from the requirements of this section; or (B) converted to performance by a contractor to circumvent a civilian personnel ceiling. (4) A military department or Defense Agency may not be required to conduct a public-private competition under Office of Management and Budget Circular A–76 or any other provision of law at the end of the performance period specified in a letter of obligation or other agreement entered into with Department of Defense civilian employees pursuant to a public-private competition for any function of the Department of Defense performed by Department of Defense civilian employees. (5)(A) Except as provided in subparagraph (B), the duration of a public-private competition conducted pursuant to Office of Management and Budget Circular A–76 or any other provision of law for any function of the Department of Defense performed by Department of Defense civilian employees may not exceed a period of 24 months, commencing on the date on which the preliminary planning for the public-private competition begins and ending on the date on which a performance decision is rendered with respect to the function. (B)(i) The Secretary of Defense may specify an alternative period of time for a public-private competition, which may not exceed 33 months, if the Secretary—(I) determines that the competition is of such complexity that it cannot be completed within 24 months; and (II) submits to Congress, as part of the formal congressional notification of a public-private competition pursuant to subsection (c), written notification that explains the basis of such determination. (ii) The notification under clause (i)(II) shall also address each of the following:(I) Any efforts of the Secretary to break up the study geographically or functionally. (II) The Secretary’s justification for undertaking a public-private competition instead of using internal reengineering alternatives. (III) The cost savings that the Secretary expects to achieve as a result of the public-private competition. (iii) If the Secretary specifies an alternative time period under this subparagraph, the alternative time period shall be binding on the Department in the same manner and to the same extent as the limitation provided in subparagraph (A). (C) The time period specified in subparagraph (A) for a public-private competition does not include any day during which the public-private competition is delayed by reason of the filing of a protest before the Government Accountability Office or a complaint in the United States Court of Federal Claims up until the day the decision or recommendation of either authority becomes final. In the case of a protest before the Government Accountability Office, the recommendation becomes final after the period of time for filing a request for reconsideration, or if a request for reconsideration is filed, on the day the Government Accountability Office issues a decision on the reconsideration. (D) If a protest with respect to a public-private competition before the Government Accountability Office or the United States Court of Federal Claims is sustained, and the recommendation is final as described in subparagraph (C), and if such protest and recommendation result in an unforeseen delay in implementing a final performance decision, the Secretary of Defense may terminate the public-private competition or extend the period of time specified for the public-private competition under subparagraph (A) or subparagraph (B). If the Secretary decides not to terminate a competition, the Secretary shall submit to Congress written notice of such decision. Any such notification shall include a justification for the Secretary’s decision and a new time limitation for the competition, which shall not exceed 12 months from the final decision and shall be binding on the Department. (E) For the purposes of this paragraph, preliminary planning with respect to a public-private competition shall be conducted in accordance with guidance and procedures that shall be issued and maintained by the Under Secretary of Defense for Personnel and Readiness and shall begin on the date on which a component of the Department of Defense first obligates funds specifically for the acquisition of contract support for the preliminary planning effort, or formally assigns Department of Defense personnel, to carry out any of the following activities:(i) Determining the scope of the public-private competition. (ii) Conducting research to determine the appropriate grouping of functions for the competition. (iii) Assessing the availability of workload data, quantifiable outputs of functions, and agency or industry performance standards applicable to the competition. (iv) Determining the baseline cost of any function for which the competition is conducted. (F) To effectively establish the date that is the first day of preliminary planning for a public-private competition, the head of a military department or Defense Agency shall submit to Congress written notice of the actions intended to be taken during the preliminary planning process and shall provide public notice of such actions by announcing such date on an appropriate Internet website and through other means as determined necessary. The date of such announcement shall be used for the purpose of computing the duration of the public private competition for purposes of this section. (G) The Secretary of Defense shall submit to the congressional defense committees an annual report on the use, during the year covered by the report, of alternative time periods for public-private competitions under this section, and the explanations of the Secretary for such alternative time periods. (b) Requirement to Consult DOD Employees.—(1) Each officer or employee of the Department of Defense responsible for determining under Office of Management and Budget Circular A–76 whether to convert to contractor performance any function of the Department of Defense—(A) shall, at least monthly during the development and preparation of the performance work statement and the management efficiency study used in making that determination, consult with civilian employees who will be affected by that determination and consider the views of such employees on the development and preparation of that statement and that study; and (B) may consult with such employees on other matters relating to that determination. (2)(A) In the case of employees represented by a labor organization accorded exclusive recognition under section 7111 of title 5, consultation with representatives of that labor organization shall satisfy the consultation requirement in paragraph (1). (B) In the case of employees other than employees referred to in subparagraph (A), consultation with appropriate representatives of those employees shall satisfy the consultation requirement in paragraph (1). (C) The Secretary of Defense shall prescribe regulations to carry out this subsection. The regulations shall include provisions for the selection or designation of appropriate representatives of employees referred to in subparagraph (B) for purposes of the consultation required by paragraph (1). (c) Congressional Notification.—(1) Before commencing a public-private competition under subsection (a), the Secretary of Defense shall submit to Congress a report containing the following:(A) The function for which such public-private competition is to be conducted. (B) The location at which the function is performed by Department of Defense civilian employees. (C) The number of Department of Defense civilian employee positions potentially affected. (D) The anticipated length and cost of the public-private competition, and a specific identification of the budgetary line item from which funds will be used to cover the cost of the public-private competition. (E) A certification that a proposed performance of the function by a contractor is not a result of a decision by an official of a military department or Defense Agency to impose predetermined constraints or limitations on such employees in terms of man years, end strengths, full-time equivalent positions, or maximum number of employees. (2) The report required under paragraph (1) shall include an examination of the potential economic effect of performance of the function by a contractor on—(A) Department of Defense civilian employees who would be affected by such a conversion in performance; and (B) the local community and the Government, if more than 50 Department of Defense civilian employees perform the function. (3)(A) A representative individual or entity at a facility where a public-private competition is conducted may submit to the Secretary of Defense an objection to the public-private competition on the grounds that the report required by paragraph (1) has not been submitted or that the certification required by paragraph (1)(E) is not included in the report submitted as a condition for the public-private competition. The objection shall be in writing and shall be submitted within 90 days after the following date:(i) In the case of a failure to submit the report when required, the date on which the representative individual or an official of the representative entity authorized to pose the objection first knew or should have known of that failure. (ii) In the case of a failure to include the certification in a submitted report, the date on which the report was submitted to Congress. (B) If the Secretary determines that the report required by paragraph (1) was not submitted or that the required certification was not included in the submitted report, the function for which the public-private competition was conducted for which the objection was submitted may not be the subject of a solicitation of offers for, or award of, a contract until, respectively, the report is submitted or a report containing the certification in full compliance with the certification requirement is submitted. (d) Exemption for the Purchase of Products and Services of the Blind and Other Severely Handicapped Persons.—This section shall not apply to a commercial or industrial type function of the Department of Defense that—(1) is included on the procurement list established pursuant to section 8503 of title 41; or (2) is planned to be changed to performance by a qualified nonprofit agency for the blind or by a qualified nonprofit agency for other severely handicapped persons in accordance with such section. (e) Inapplicability During War or Emergency.—The provisions of this section shall not apply during war or during a period of national emergency declared by the President or Congress.

10 U.S.C. § 2461a Development and implementation of system for monitoring cost saving resulting from public-private competitions

(a) System for Monitoring Performance.—(1) The Secretary of Defense shall monitor the performance, including the cost of performance, of each function of the Department of Defense that, after October 30, 2000, is the subject of a public-private competition conducted under section 2461 of this title. (2) In carrying out paragraph (1), the Secretary shall—(A) compare the cost of performing the function before the public-private competition to the cost of performing the function after the implementation of the results of the public-private competition; and (B) identify any actual savings of the Department of Defense after the implementation of the results of the public-private competition and compare such savings to the estimated savings identified pursuant to section 2461(a)(1)(E) of this title for that public-private competition; (3) The monitoring of a function shall continue under this section for at least five years after the conversion, reorganization, or reengineering of the function pursuant to such a public-private competition. (b) Consideration in Preparation of Future-Years Defense Program.—In preparing the future-years defense program under section 221 of this title, the Secretary of Defense shall, for the fiscal years covered by the program, estimate and take into account the costs to be incurred and the savings to be derived from the performance of functions by workforces selected in public-private competitions conducted under section 2461 of this title. The Secretary shall consider the results of the monitoring under this section in making the estimates.

10 U.S.C. § 2463 Guidelines and procedures for use of civilian employees to perform Department of Defense functions

(a) Guidelines Required.—(1) The Under Secretary of Defense for Personnel and Readiness shall devise and implement guidelines and procedures to ensure that consideration is given to using, on a regular basis, Department of Defense civilian employees to perform new functions and functions that are performed by contractors and could be performed by Department of Defense civilian employees. The Secretary of a military department may prescribe supplemental regulations, if the Secretary determines such regulations are necessary for implementing such guidelines within that military department. (2) The guidelines and procedures required under paragraph (1) may not include any specific limitation or restriction on the number of functions or activities that may be converted to performance by Department of Defense civilian employees. (b) Special Consideration for Certain Functions.—The guidelines and procedures required under subsection (a) shall provide for special consideration to be given to using Department of Defense civilian employees to perform any function that—(1) is performed by a contractor and—(A) is a critical function that—(i) is necessary to maintain sufficient Government expertise and technical capabilities; or (ii) entails operational risk associated with contractor performance; (B) is an acquisition workforce function; (C) is a function closely associated with the performance of an inherently governmental function; (D) has been performed by Department of Defense civilian employees at any time during the previous 10-year period; (E) has been performed pursuant to a contract awarded on a non-competitive basis; or (F) has been performed poorly, as determined by a contracting officer during the 5-year period preceding the date of such determination, because of excessive costs or inferior quality; or (2) is a new requirement, with particular emphasis given to a new requirement that is similar to a function previously performed by Department of Defense civilian employees or is a function closely associated with the performance of an inherently governmental function. (c) Exclusion of Certain Functions From Competitions.—The Secretary of Defense may not conduct a public-private competition under this chapter, Office of Management and Budget Circular A–76, or any other provision of law or regulation before—(1) in the case of a new Department of Defense function, assigning the performance of the function to Department of Defense civilian employees; (2) in the case of any Department of Defense function described in subsection (b), converting the function to performance by Department of Defense civilian employees; or (3) in the case of a Department of Defense function performed by Department of Defense civilian employees, expanding the scope of the function. (d) Use of Flexible Hiring Authority.—(1) The Secretary of Defense may use the flexible hiring authority available to the Secretary pursuant to section 9902 of title 5, to facilitate the performance by Department of Defense civilian employees of functions described in subsection (b). (2) The Secretary shall make use of the inventory required by section 4505(c) of this title for the purpose of identifying functions that should be considered for performance by Department of Defense civilian employees pursuant to subsection (b). (e) Determinations Relating to the Conversion of Certain Functions.—(1) Except as provided in paragraph (2), in determining whether a function should be converted to performance by Department of Defense civilian employees, the Secretary of Defense shall—(A) develop methodology for determining costs based on the guidance outlined in the Directive-Type Memorandum 09–007 entitled “Estimating and Comparing the Full Costs of Civilian and Military Manpower and Contractor Support” or any successor guidance for the determination of costs when costs are the sole basis for the determination; (B) take into consideration any supplemental guidance issued by the Secretary of a military department for determinations affecting functions of that military department; and (C) ensure that the difference in the cost of performing the function by a contractor compared to the cost of performing the function by Department of Defense civilian employees would be equal to or exceed the lesser of—(i) 10 percent of the personnel-related costs for performance of that function; or (ii) $10,000,000. (2) Paragraph (1) shall not apply to any function that is inherently governmental or any function described in subparagraph (A), (B), or (C) of subsection (b)(1). (f) Notification Relating to the Conversion of Certain Functions.—The Secretary of Defense shall establish procedures for the timely notification of any contractor who performs a function that the Secretary plans to convert to performance by Department of Defense civilian employees pursuant to subsection (a). The Secretary shall provide a copy of any such notification to the congressional defense committees. (g) Definitions.—In this section:(1) The term “functions closely associated with inherently governmental functions” has the meaning given that term in section 4508(b)(3) of this title. (2) The term “acquisition function” has the meaning given that term under section 1721(a) of this title. (3) The term “inherently governmental function” has the meaning given that term in the Federal Activities Inventory Reform Act of 1998 (Public Law 105–270; 31 U.S.C. 501 note).

10 U.S.C. § 2464 Core logistics capabilities

(a) Necessity for Core Logistics Capabilities.—(1) It is essential for the national defense that the Department of Defense maintain a core logistics capability that is Government-owned and Government-operated (including Government personnel and Government-owned and Government-operated equipment and facilities) to ensure a ready and controlled source of technical competence and resources necessary to ensure effective and timely response to a mobilization, national defense contingency situations, and other emergency requirements. (2) The Secretary of Defense shall identify the core logistics capabilities described in paragraph (1) and the workload required to maintain those capabilities. (3) The core logistics capabilities identified under paragraphs (1) and (2) shall include those capabilities that are necessary to maintain and repair the weapon systems and other military equipment (including mission-essential weapon systems or materiel not later than four years after achieving initial operational capability, but excluding systems and equipment under special access programs, nuclear aircraft carriers, and commercial products or commercial services described in paragraph (5)) that are identified by the Secretary, in consultation with the Chairman of the Joint Chiefs of Staff, as necessary to enable the armed forces to fulfill the strategic and contingency plans prepared by the Chairman of the Joint Chiefs of Staff under section 153(a) of this title. (4) The Secretary of Defense shall require the performance of core logistics workloads necessary to maintain the core logistics capabilities identified under paragraphs (1), (2), and (3) at Government-owned, Government-operated facilities of the Department of Defense (including Government-owned, Government-operated facilities of a military department) and shall assign such facilities sufficient workload to ensure cost efficiency and technical competence in peacetime while preserving the surge capacity and reconstitution capabilities necessary to support fully the strategic and contingency plans referred to in paragraph (3). (5) The commercial products or commercial services covered by paragraph (3) are commercial products (as defined in section 103 of title 41) or commercial services (as defined in section 103a of such title) that have been sold or leased in substantial quantities to the general public and are purchased without modification in the same form that they are sold in the commercial marketplace, or with minor modifications to meet Federal Government requirements. (b) Limitation on Contracting.—(1) Except as provided in paragraph (2), performance of workload needed to maintain a logistics capability identified by the Secretary under subsection (a)(2) may not be contracted for performance by non-Government personnel under the procedures and requirements of Office of Management and Budget Circular A–76 or any successor administrative regulation or policy (hereinafter in this section referred to as OMB Circular A–76). (2) The Secretary of Defense may waive paragraph (1) in the case of any such logistics capability and provide that performance of the workload needed to maintain that capability shall be considered for conversion to contractor performance in accordance with OMB Circular A–76. Any such waiver shall be made under regulations prescribed by the Secretary and shall be based on a determination by the Secretary that Government performance of the workload is no longer required for national defense reasons. Such regulations shall include criteria for determining whether Government performance of any such workload is no longer required for national defense reasons. (3)(A) A waiver under paragraph (2) may not take effect until the expiration of the first period of 30 days of continuous session of Congress that begins on or after the date on which the Secretary submits a report on the waiver to the Committee on Armed Services and the Committee on Appropriations of the Senate and the Committee on Armed Services and the Committee on Appropriations of the House of Representatives. (B) For the purposes of subparagraph (A)—(i) continuity of session is broken only by an adjournment of Congress sine die; and (ii) the days on which either House is not in session because of an adjournment of more than three days to a day certain are excluded in the computation of any period of time in which Congress is in continuous session. (c) Notification of Determinations Regarding Certain Commercial Products or Commercial Services.—The first time that a weapon system or other item of military equipment described in subsection (a)(3) is determined to be a commercial product or commercial service for the purposes of the exception contained in that subsection, the Secretary of Defense shall submit to Congress a notification of the determination, together with the justification for the determination. The justification for the determination shall include, at a minimum, the following:(1) The estimated percentage of commonality of parts of the version of the item that is sold or leased in the commercial marketplace and the Government’s version of the item. (2) The value of any unique support and test equipment and tools that are necessary to support the military requirements if the item were maintained by the Government. (3) A comparison of the estimated life cycle logistics support costs that would be incurred by the Government if the item were maintained by the private sector with the estimated life cycle logistics support costs that would be incurred by the Government if the item were maintained by the Government. (d) Biennial Core Report.—Not later than April 1 of each even-numbered year, the Secretary of Defense shall submit to Congress a report identifying, for each of the armed forces (except for the Coast Guard), for the fiscal year after the fiscal year during which the report is submitted, each of the following:(1) The core depot-level maintenance and repair capability requirements and sustaining workloads, organized by work breakdown structure, expressed in direct labor hours. (2) The corresponding workloads necessary to sustain core depot-level maintenance and repair capability requirements, expressed in direct labor hours and cost. (3) In any case where core depot-level maintenance and repair capability requirements exceed or are expected to exceed sustaining workloads, a detailed rationale for any and all shortfalls and a plan either to correct or mitigate the effects of the shortfalls. (4) Any workload shortfalls at any work breakdown structure category designated as a lower-level category pursuant to Department of Defense Instruction 4151.20, or any successor instruction. (5) A description of any workload executed at a category designated as a first-level category pursuant to such Instruction, or any successor instruction, that could be used to mitigate shortfalls in similar categories. (6) A description of any progress made on implementing mitigation plans developed pursuant to paragraph (3). (7) A description of core capability requirements and corresponding workloads at the first level category. (8) In the case of any shortfall that is identified, a description of the shortfall and an identification of the subcategory of the work breakdown structure in which the shortfall occurred. (9) In the case of any work breakdown structure category designated as a special interest item or other pursuant to such Instruction, or any successor instruction, an explanation for such designation. (10) Whether the core depot-level maintenance and repair capability requirements described in the report submitted under this subsection for the preceding fiscal year have been executed.

10 U.S.C. § 2465 Prohibition on contracts for performance of firefighting or security-guard functions

(a) Except as provided in subsection (b), funds appropriated to the Department of Defense may not be obligated or expended for the purpose of entering into a contract for the performance of firefighting or security-guard functions at any military installation or facility. (b) The prohibition in subsection (a) does not apply to the following contracts:(1) A contract to be carried out at a location outside the United States (including its commonwealths, territories, and possessions) at which members of the armed forces would have to be used for the performance of a function described in subsection (a) at the expense of unit readiness. (2) A contract to be carried out on a Government-owned but privately operated installation. (3) A contract (or the renewal of a contract) for the performance of a function under contract on September 24, 1983. (4) A contract that is—(A) for a period of one year or less; and (B) covers the performance of functions that, in the absence of the contract, would have to be performed by members of the armed forces who are not readily available to perform such functions.

10 U.S.C. § 2466 Limitations on the performance of depot-level maintenance of materiel

(a) Percentage Limitation.—Not more than 50 percent of the funds made available in a fiscal year to a military department or a Defense Agency for depot-level maintenance and repair workload may be used to contract for the performance by non-Federal Government personnel of such workload for the military department or the Defense Agency. Any such funds that are not used for such a contract shall be used for the performance of depot-level maintenance and repair workload by employees of the Department of Defense. (b) Waiver of Limitation.—The Secretary of Defense may waive the limitation in subsection (a) for a fiscal year if—(1) the Secretary determines that the waiver is necessary for reasons of national security; and (2) the Secretary submits to Congress a notification of the waiver together with the reasons for the waiver. (c) Prohibition on Delegation of Waiver Authority.—The authority to grant a waiver under subsection (b) may not be delegated. (d) Annual Report.—(1) Not later than 90 days after the date on which the budget of the President for a fiscal year is submitted to Congress pursuant to section 1105 of title 31, the Secretary of Defense shall submit to Congress a report identifying, for each of the armed forces (other than the Coast Guard) and each Defense Agency, the percentage of the funds referred to in subsection (a) that was expended during the preceding fiscal year, and are projected to be expended during the current fiscal year and the ensuing fiscal year, for performance of depot-level maintenance and repair workloads by the public and private sectors. (2) Each report required under paragraph (1) shall include as a separate item any expenditure covered by section 2474(f) of this title that was made during the fiscal year covered by the report and shall specify the amount and nature of each such expenditure.

10 U.S.C. § 2469 Contracts to perform workloads previously performed by depot-level activities of the Department of Defense: requirement of competition

(a) Requirement for Competition.—The Secretary of Defense shall ensure that the performance of a depot-level maintenance and repair workload described in subsection (b) is not changed to performance by a contractor or by another depot-level activity of the Department of Defense unless the change is made using—(1) merit-based selection procedures for competitions among all depot-level activities of the Department of Defense; or (2) competitive procedures for competitions among private and public sector entities. (b) Scope.—Except as provided in subsection (c), subsection (a) applies to any depot-level maintenance and repair workload that has a value of not less than $3,000,000 (including the cost of labor and materials) and is being performed by a depot-level activity of the Department of Defense. (c) Exception for Public-Private Partnerships.—The requirements of subsection (a) may be waived in the case of a depot-level maintenance and repair workload that is performed at a Center of Industrial and Technical Excellence designated under subsection (a) of section 2474 of this title by a public-private partnership entered into under subsection (b) of such section consisting of a depot-level activity and a private entity. (d) Inapplicability of OMB Circular A–76.—Office of Management and Budget Circular A–76 (or any successor administrative regulation or policy) does not apply to a performance change to which subsection (a) applies.

10 U.S.C. § 2470 Depot-level activities of the Department of Defense: authority to compete for maintenance and repair workloads of other Federal agencies

A depot-level activity of the Department of Defense shall be eligible to compete for the performance of any depot-level maintenance and repair workload of a Federal agency for which competitive procedures are used to select the entity to perform the workload.

10 U.S.C. § 2472 Prohibition on management of depot employees by end strength

The civilian employees of the Department of Defense, including the civilian employees of the military departments and the Defense Agencies, who perform, or are involved in the performance of, depot-level maintenance and repair workloads may not be managed on the basis of any constraint or limitation in terms of man years, end strength, full-time equivalent positions, or maximum number of employees. Such employees shall be managed solely on the basis of the available workload and the funds made available for such depot-level maintenance and repair.

10 U.S.C. § 2473 Annual five-year plans on improvement of depot infrastructure

(a) Submission.—As part of the annual budget submission of the President under section 1105(a) of title 31, each Secretary of a military department shall submit to the congressional defense committees a plan describing the objectives of that Secretary to improve depot infrastructure during the five fiscal years following the fiscal year for which such budget is submitted. (b) Elements.—Each plan submitted by a Secretary of a military department under subsection (a) shall include the following:(1) With respect to the five-year period covered by the plan, an identification of the major lines of effort, milestones, and specific goals of the Secretary over such period relating to the improvement of depot infrastructure and a description of how such goals support the goals outlined in section 359(b)(1)(B) of the National Defense Authorization Act for Fiscal Year 2020 (Public Law 116–92; 133 Stat. 1324; 10 U.S.C. 2476 note). (2) The estimated costs of necessary depot infrastructure improvements and a description of how such costs would be addressed by the Department of Defense budget request submitted during the same year as the plan and the applicable future-years defense program. (3) Information regarding the plan of the Secretary to initiate such environmental and engineering studies as may be necessary to carry out planned depot infrastructure improvements. (4) Detailed information regarding how depot infrastructure improvement projects will be paced and sequenced to ensure continuous operations. (c) Incorporation of Results-oriented Management Practices.—Each plan under subsection (a) shall incorporate the leading results-oriented management practices identified in the report of the Comptroller General of the United States titled “Actions Needed to Improve Poor Conditions of Facilities and Equipment that Affect Maintenance Timeliness and Efficiency” (GAO–19–242), or any successor report, including—(1) analytically based goals; (2) results-oriented metrics; (3) the identification of required resources, risks, and stakeholders; and (4) regular reporting on progress to decision makers.

10 U.S.C. § 2474 Centers of Industrial and Technical Excellence: designation; public-private partnerships

(a) Designation.—(1) The Secretary concerned, or the Secretary of Defense in the case of a Defense Agency, shall designate each depot-level activity or military arsenal facility of the military departments and the Defense Agencies (other than facilities approved for closure or major realignment under the Defense Base Closure and Realignment Act of 1990 (part A of title XXIX of Public Law 101–510; 10 U.S.C. 2687 note)) as a Center of Industrial and Technical Excellence in the recognized core competencies of the designee. (2) The Secretary of Defense shall establish a policy to encourage the Secretary of each military department and the head of each Defense Agency to reengineer industrial processes and adopt best-business practices at their Centers of Industrial and Technical Excellence in connection with their core competency requirements, so as to serve as recognized leaders in their core competencies throughout the Department of Defense and in the national technology and industrial base (as defined in section 4801(1) of this title). (3) The Secretary of a military department may conduct a pilot program, consistent with applicable requirements of law, to test any practices referred to in paragraph (2) that the Secretary determines could improve the efficiency and effectiveness of operations at Centers of Industrial and Technical Excellence, improve the support provided by the Centers for the armed forces user of the services of the Centers, and enhance readiness by reducing the time that it takes to repair equipment. (b) Public-Private Partnerships.—(1) To achieve one or more objectives set forth in paragraph (2), the Secretary designating a Center of Industrial and Technical Excellence under subsection (a) may authorize and encourage the head of the Center to enter into public-private cooperative arrangements (in this section referred to as a “public-private partnership”) to provide for any of the following:(A) For employees of the Center, private industry, or other entities outside the Department of Defense to perform (under contract, subcontract, or otherwise) work related to the core competencies of the Center, including any depot-level maintenance and repair work that involves one or more core competencies of the Center. (B) For private industry or other entities outside the Department of Defense to use, for any period of time determined to be consistent with the needs of the Department of Defense, any facilities or equipment of the Center that are not fully utilized for a military department’s own production or maintenance requirements. (2) The objectives for exercising the authority provided in paragraph (1) are as follows:(A) To maximize the utilization of the capacity of a Center of Industrial and Technical Excellence. (B) To reduce or eliminate the cost of ownership of a Center by the Department of Defense in such areas of responsibility as operations and maintenance and environmental remediation. (C) To reduce the cost of products of the Department of Defense produced or maintained at a Center. (D) To leverage private sector investment in—(i) such efforts as plant and equipment recapitalization for a Center; and (ii) the promotion of the undertaking of commercial business ventures at a Center. (E) To foster cooperation between the armed forces and private industry. (3) If the Secretary concerned, or the Secretary of Defense in the case of a Defense Agency, authorizes the use of public-private partnerships under this subsection, the Secretary shall submit to Congress a report evaluating the need for loan guarantee authority, similar to the ARMS Initiative loan guarantee program under section 7555 of this title, to facilitate the establishment of public-private partnerships and the achievement of the objectives set forth in paragraph (2). (c) Private Sector Use of Excess Capacity.—Any facilities or equipment of a Center of Industrial and Technical Excellence made available to private industry may be used to perform maintenance or to produce goods in order to make more efficient and economical use of Government-owned industrial plants and encourage the creation and preservation of jobs to ensure the availability of a workforce with the necessary manufacturing and maintenance skills to meet the needs of the armed forces. (d) Crediting of Amounts for Performance.—Amounts received by a Center for work performed under a public-private partnership shall be credited to the appropriation or fund, including a working-capital fund, that incurs the cost of performing the work. Consideration in the form of rental payments or (notwithstanding section 3302(b) of title 31) in other forms may be accepted for a use of property accountable under a contract performed pursuant to this section. Notwithstanding section 2667(e) of this title, revenues generated pursuant to this section shall be available for facility operations, maintenance, and environmental restoration at the Center where the leased property is located. (e) Availability of Excess Equipment to Private-Sector Partners.—Equipment or facilities of a Center of Industrial and Technical Excellence may be made available for use by a private-sector entity under this section only if—(1) the use of the equipment or facilities will not have a significant adverse effect on the readiness of the armed forces, as determined by the Secretary concerned or, in the case of a Center in a Defense Agency, by the Secretary of Defense; and (2) the private-sector entity agrees—(A) to reimburse the Department of Defense for the direct and indirect costs (including any rental costs) that are attributable to the entity’s use of the equipment or facilities, as determined by that Secretary; and (B) to hold harmless and indemnify the United States from—(i) any claim for damages or injury to any person or property arising out of the use of the equipment or facilities, except under the circumstances described in section 2563(c)(3) of this title; and (ii) any liability or claim for damages or injury to any person or property arising out of a decision by the Secretary concerned or the Secretary of Defense to suspend or terminate that use of equipment or facilities during a war or national emergency. (f) Exclusion of Certain Expenditures From Percentage Limitation.—Amounts expended for the performance of a depot-level maintenance and repair workload by non-Federal Government personnel at a Center of Industrial and Technical Excellence under any contract shall not be counted for purposes of applying the percentage limitation in section 2466(a) of this title if the personnel are provided by private industry or other entities outside the Department of Defense pursuant to a public-private partnership. (g) Construction of Provision.—Nothing in this section may be construed to authorize a change, otherwise prohibited by law, from the performance of work at a Center of Industrial and Technical Excellence by Department of Defense personnel to performance by a contractor.

10 U.S.C. § 2475 Consolidation, restructuring, or reengineering of organizations, functions, or activities: notification requirements

(a) Strategic Sourcing Plan of Action Defined.—In this section, the term “Strategic Sourcing Plan of Action” means a Strategic Sourcing Plan of Action for the Department of Defense (as identified in the Department of Defense Interim Guidance dated February 29, 2000, or any successor Department of Defense guidance or directive) in effect for a fiscal year. (b) Notification of Decision To Execute Plan.—If a decision is made to consolidate, restructure, or reengineer an organization, function, or activity of the Department of Defense pursuant to a Strategic Sourcing Plan of Action described in subsection (a), and such consolidation, restructuring, or reengineering would result in a manpower reduction affecting 50 or more personnel of the Department of Defense (including military and civilian personnel)—(1) the Secretary of Defense shall submit to the Committees on Armed Services of the Senate and the House of Representatives a report describing that decision, including—(A) a projection of the savings that will be realized as a result of the consolidation, restructuring, or reengineering, compared with the cost incurred by the Department of Defense to perform the function or to operate the organization or activity prior to such proposed consolidation, restructuring, or reengineering; (B) a description of all missions, duties, or military requirements that will be affected as a result of the decision to consolidate, restructure, or reengineer the organization, function, or activity that was analyzed; (C) the Secretary’s certification that the consolidation, restructuring, or reengineering will not result in any diminution of military readiness; (D) a schedule for performing the consolidation, restructuring, or reengineering; and (E) the Secretary’s certification that the entire analysis for the consolidation, restructuring, or reengineering is available for examination; and (2) the head of the Defense Agency or the Secretary of the military department concerned may not implement the plan until 30 days after the date that the agency head or Secretary submits notification to the Committees on Armed Services of the Senate and House of Representatives of the intent to carry out such plan.

10 U.S.C. § 2476 Minimum capital investment for certain depots

(a) Minimum Investment.—(1) Each fiscal year, the Secretary of a military department shall invest in the capital budgets of the covered depots of that military department a total amount equal to not less than eight percent of the average total combined maintenance, repair, and overhaul workload funded at all the depots of that military department for the preceding three fiscal years. (2) Of the amount required to be invested in the capital budgets of the covered depots of a military department under paragraph (1) for each fiscal year—(A) 75 percent shall be used for the modernization or improvement of the efficiency of depot facilities, equipment, work environment, or processes in direct support of depot operations; and (B) 25 percent shall be used for the sustainment, restoration, and modernization (as such terms are defined in the Department of Defense Financial Management Regulation 7000.14–R, or successor regulation) of existing facilities or infrastructure. (b) Capital Budget.—For purposes of this section, the capital budget of a depot includes investment funds spent to modernize or improve the efficiency of depot facilities, equipment, work environment, or processes in direct support of depot operations. (c) Compliance With Certain Requirements Relating to Personnel and Total Force Management.—In identifying amounts to invest pursuant to the requirement under subsection (a)(1), the Secretary of a military department shall comply with all applicable requirements of sections 129 and 129a of this title. (d) Waiver.—The Secretary of Defense may waive the requirement under subsection (a)(1) with respect to a military department for a fiscal year if the Secretary determines that the waiver is necessary for reasons of national security. Whenever the Secretary makes such a waiver, the Secretary shall notify the congressional defense committees of the waiver and the reasons for the waiver. (e) Annual Report.—(1) Not later than 45 days after the date on which the President submits to Congress the budget for a fiscal year under section 1105 of title 31, the Secretary of Defense shall submit to the congressional defense committees a report containing budget justification documents summarizing the level of capital investment for each military department as of the end of the preceding fiscal year. (2) Each report submitted under paragraph (1) shall include the following:(A) A specification of any statutory, regulatory, or operational impediments to achieving the requirement under subsection (a)(1) with respect to each military department. (B) A description of the benchmarks for capital investment established for each covered depot and military department and the relationship of the benchmarks to applicable performance measurement methods used in the private sector. (C) If the requirement under subsection (a)(1) is not met for a military department for the fiscal year covered by the report, a statement of the reasons why the requirement was not met and a plan of actions for meeting the requirement for the fiscal year beginning in the year in which such report is submitted. (D) Separate consideration and reporting of Navy depots and Marine Corps depots. (E) A table showing the funded workload performed by each covered depot for the preceding three fiscal years and actual investment funds allocated to each depot for the period covered by the report. (F) A table enumerating, for the period covered by the report, the amounts invested to meet the requirement under subsection (a)(1), disaggregated by funding source and whether the amount is allocated pursuant to subparagraph (A) or subparagraph (B) of subsection (a)(2). (f) Covered Depot.—In this section, the term “covered depot” means any of the following:(1) With respect to the Department of the Army:(A) Anniston Army Depot, Alabama. (B) Letterkenny Army Depot, Pennsylvania. (C) Tobyhanna Army Depot, Pennsylvania. (D) Corpus Christi Army Depot, Texas. (E) Red River Army Depot, Texas. (F) Watervliet Arsenal, New York. (G) Rock Island Arsenal, Illinois. (H) Pine Bluff Arsenal, Arkansas. (I) Tooele Army Depot, Utah. (2) With respect to the Department of the Navy:(A) The following Navy depots:(i) Fleet Readiness Center East Site, Cherry Point, North Carolina. (ii) Fleet Readiness Center Southwest Site, North Island, California. (iii) Fleet Readiness Center Southeast Site, Jacksonville, Florida. (iv) Portsmouth Naval Shipyard, Maine. (v) Pearl Harbor Naval Shipyard, Hawaii. (vi) Puget Sound Naval Shipyard, Washington. (vii) Norfolk Naval Shipyard, Virginia. (B) The following Marine Corps depots:(i) Marine Corps Logistics Base, Albany, Georgia. (ii) Marine Corps Logistics Base, Barstow, California. (3) With respect to the Department of the Air Force:(A) Warner-Robins Air Logistics Center, Georgia. (B) Ogden Air Logistics Center, Utah. (C) Oklahoma City Air Logistics Center, Oklahoma.

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