INCLUSION OF PLAN ON THE FINANCIAL MANAGEMENT WORKFORCE IN THE STRATEGIC WORKFORCE PLAN OF THE DEPARTMENT OF DEFENSE (SEC. 1053)

INCLUSION OF PLAN ON THE FINANCIAL MANAGEMENT WORKFORCE IN THE STRATEGIC WORKFORCE PLAN OF THE DEPARTMENT OF DEFENSE (SEC. 1053) The House bill contained a provision (sec. 1063) that would require an assessment of the financial management workforce of the Department of Defense and a plan for addressing any gaps in capabilities of that workforce. The Senate amendment contained no similar provision. The Senate recedes with an amendment that would require the Secretary of Defense to assess and plan the Department s financial management workforce through the strategic workforce plan established pursuant to section 115b of title 10, United States Code. SEC. 1053. INCLUSION OF PLAN ON THE FINANCIAL MANAGEMENT WORKFORCE IN THE STRATEGIC WORKFORCE PLAN OF THE DEPARTMENT OF DEFENSE. Section 115b of title 10, United States Code, is amended (1) by redesignating subsections (e) and (f) as subsections (f) and (g), respectively; and (2) by inserting after subsection (d) the fol1lowing new subsection (e): (e) FINANCIAL MANAGEMENT WORKFORCE. (1) Each strategic workforce plan under subsection (a) shall include a separate chapter to specifically address the shaping and improvement of the financial management workforce of the Department of Defense, including both military and civilian personnel of that workforce. (2) For purposes of paragraph (1), each plan shall include, with respect to the financial management workforce of the Department (A) an assessment of the matters set forth in subparagraphs (A) through (D) of subsection (b)(1); (B) a plan of action meeting the requirements set forth in subparagraphs (A) through (F) of subsection (b)(2); (C) specific steps that the Department has taken or plans to take to develop appropriate career paths for civilian employees in the financial management field and to implement the requirements of 10 section 1599d of this title; and (D) a plan for funding needed improvements in the financial management workforce of the Department through the period of the current future years defense program under section 221 of this title, including a description of any continuing short falls in funding available for that workforce.. TITLE 10 - ARMED FORCES SUBTITLE A - GENERAL MILITARY LAW PART I - ORGANIZATION AND GENERAL MILITARY POWERS CHAPTER 2 - DEPARTMENT OF DEFENSE 115b. Annual strategic workforce plan (a) Annual Plan Required. (1) The Secretary of Defense shall submit to the congressional defense committees on an annual basis a strategic workforce plan to shape and improve the civilian employee workforce of the Department of Defense.

(2) The Under Secretary of Defense for Personnel and Readiness shall have overall responsibility for developing and implementing the strategic workforce plan, in consultation with the Under Secretary of Defense for Acquisition, Technology, and Logistics. (b) Contents. Each strategic workforce plan under subsection (a) shall include, at a minimum, the following: (1) An assessment of (A) the critical skills and competencies that will be needed in the future within the civilian employee workforce by the Department of Defense to support national security requirements and effectively manage the Department during the seven-year period following the year in which the plan is submitted; (B) the appropriate mix of military, civilian, and contractor personnel capabilities; (C) the critical skills and competencies of the existing civilian employee workforce of the Department and projected trends in that workforce based on expected losses due to retirement and other attrition; and (D) gaps in the existing or projected civilian employee workforce of the Department that should be addressed to ensure that the Department has continued access to the critical skills and competencies described in subparagraphs (A) and (C). (2) A plan of action for developing and reshaping the civilian employee workforce of the Department to address the gaps in critical skills and competencies identified under paragraph (1)(D), including (A) specific recruiting and retention goals, especially in areas identified as critical skills and competencies under paragraph (1), including the program objectives of the Department to be achieved through such goals and the funding needed to achieve such goals; (B) specific strategies for developing, training, deploying, compensating, and motivating the civilian employee workforce of the Department, including the program objectives of the Department to be achieved through such strategies and the funding needed to implement such strategies; (C) any incentives necessary to attract or retain any civilian personnel possessing the skills and competencies identified under paragraph (1); (D) any changes in the number of personnel authorized in any category of personnel listed in subsection (f)(1) or in the acquisition workforce that may be needed to address such gaps and effectively meet the needs of the Department; (E) any changes in resources or in the rates or methods of pay for any category of personnel listed in subsection (f)(1) or in the acquisition workforce that may be needed to address inequities and ensure that the Department has full access to appropriately qualified personnel to address such gaps and meet the needs of the Department; and (F) any legislative changes that may be necessary to achieve the goals referred to in subparagraph (A). (3) An assessment, using results-oriented performance measures, of the progress of the Department in implementing the strategic workforce plan under this section during the previous year. (4) Any additional matters the Secretary of Defense considers necessary to address. (c) Senior Management, Functional, and Technical Workforce. (1) Each strategic workforce plan under subsection (a) shall include a separate chapter to specifically address the shaping and improvement of the senior management, functional, and technical workforce (including scientists and engineers) of the Department of Defense. (2) For purposes of paragraph (1), each plan shall include, with respect to such senior management, functional, and technical workforce

(A) an assessment of the matters set forth in subparagraphs (A) through (D) of subsection (b)(1); (B) a plan of action meeting the requirements set forth in subparagraphs (A) through (F) of subsection (b)(2); (C) specific strategies for developing, training, deploying, compensating, motivating, and designing career paths and career opportunities; and (D) specific steps that the Department has taken or plans to take to ensure that such workforce is managed in compliance with the requirements of section 129 of this title. (d) Defense Acquisition Workforce. (1) Each strategic workforce plan under subsection (a) shall include a separate chapter to specifically address the shaping and improvement of the defense acquisition workforce, including both military and civilian personnel. (2) For purposes of paragraph (1), each plan shall include, with respect to the defense acquisition workforce (A) an assessment of the matters set forth in subparagraphs (A) through (D) of subsection (b)(1); (B) a plan of action meeting the requirements set forth in subparagraphs (A) through (F) of subsection (b)(2); (C) specific steps that the Department has taken or plans to take to develop appropriate career paths for civilian employees in the acquisition field and to implement the requirements of section 1722a of this title with regard to members of the armed forces in the acquisition field; and (D) a plan for funding needed improvements in the acquisition workforce of the Department through the period of the future-years defense program, including (i) the funding programmed for defense acquisition workforce improvements, including a specific identification of funding provided in the Department of Defense Acquisition Workforce Fund established under section 1705 of this title, along with a description of how such funding is being implemented and whether it is being fully used; and (ii) a description of any continuing shortfalls in funding available for the acquisition workforce. (e) Financial Management Workforce. (1) Each strategic workforce plan under subsection (a) shall include a separate chapter to specifically address the shaping and improvement of the financial management workforce of the Department of Defense, including both military and civilian personnel of that workforce. (2) For purposes of paragraph (1), each plan shall include, with respect to the financial management workforce of the Department (A) an assessment of the matters set forth in subparagraphs (A) through (D) of subsection (b)(1); (B) a plan of action meeting the requirements set forth in subparagraphs (A) through (F) of subsection (b)(2); (C) specific steps that the Department has taken or plans to take to develop appropriate career paths for civilian employees in the financial management field and to implement the requirements of 10 section 1599d of this title; and (D) a plan for funding needed improvements in the financial management workforce of the Department through the period of the current future years defense program under section 221 of this title, including a description of any continuing short falls in funding available for that workforce.. (ef) Submittals by Secretaries of the Military Departments and Heads of the Defense Agencies.

The Secretary of Defense shall require the Secretary of each military department and the head of each Defense Agency to submit a report to the Secretary addressing each of the matters described in this section. The Secretary of Defense shall establish a deadline for the submittal of reports under this subsection that enables the Secretary to consider the material submitted in a timely manner and incorporate such material, as appropriate, into the strategic workforce plan required by this section. (fg) Definitions. In this section: (1) The term senior management, functional, and technical workforce of the Department of Defense includes the following categories of Department of Defense civilian personnel: (A) Appointees in the Senior Executive Service under section 3131 of title 5. (B) Persons serving in positions described in section 5376 (a) of title 5. (C) Highly qualified experts appointed pursuant to section 9903 of title 5. (D) Scientists and engineers appointed pursuant to section 342(b) of the National Defense Authorization Act for Fiscal Year 1995 (Public Law 103 337; 108 Stat. 2721), as amended by section 1114 of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 (as enacted into law by Public Law 106 398 (114 Stat. 1654A 315)). (E) Scientists and engineers appointed pursuant to section 1101 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (5 U.S.C. 3104 note ). (F) Persons serving in the Defense Intelligence Senior Executive Service under section 1606 of this title. (G) Persons serving in Intelligence Senior Level positions under section 1607 of this title. (2) The term acquisition workforce includes individuals designated under section 1721 as filling acquisition positions.

TRACKING IMPLEMENTATION OF DEPARTMENT OF DEFENSE EFFICIENCIES (SEC. 1054) The House bill contained a provision (sec. 1064) that would require the Comptroller General to assess and report to Congress on the extent to which the Department of Defense has tracked and realized the savings proposed pursuant to the efficiencies initiatives announced by the Secretary of Defense. The Senate amendment contained no similar provision. The Senate recedes. SEC. 1054. TRACKING IMPLEMENTATION OF DEPARTMENT OF DEFENSE EFFICIENCIES. (a) ANNUAL ASSESSMENTS. For each of fiscal years 2012 through 2016, the Comptroller General of the United States shall carry out an assessment of the extent to which the Department of Defense has tracked and realized the savings proposed pursuant to the initiative led by the Secretary of Defense to identify at least $100,000,000,000 in efficiencies during fiscal years 2012 through 2016. (b) ANNUAL REPORT. Not later than October 30 of each of 2012 through 2016, the Comptroller General shall submit to the congressional defense committees a report on the assessment carried out under subsection (a) for the fiscal year ending on September 30 of that year. Each such report shall include the recommendations of the Comptroller General with respect to the matter covered by the assessment.

CORE DEPOT-LEVEL MAINTENANCE AND REPAIR CAPABILITIES (SEC. 327) The House bill contained a provision (sec. 322) that would modify core logistics capabilities requirements (10 U.S.C. 2464) and require an annual report. The Senate amendment contained no similar provision. The Senate recedes with a clarifying amendment. The conferees note that the study on the future capability of the Department of Defense (DOD) maintenance depots directed by section 322 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Public Law 110-417) found that the existing core determination process should be revised to ensure that it is visible and readily understood. Through this conference agreement, the conferees confirm the criticality of a government-controlled source of repair to support warfighter requirements. The conferees believe a streamlined core policy that eliminates exclusions and exemptions and instead provides for conditional waivers of government performance is in keeping with the section 322 study s recommendations. To provide greater transparency of the core determination process, the conference agreement includes an annual core report that should align capital investment to support current and emerging core requirements and better align sustainment planning with acquisition and development. SEC. 327. CORE DEPOT-LEVEL MAINTENANCE AND REPAIR CAPABILITIES. (a) IN GENERAL. Section 2464 of title 10, United States Code, is amended to read as follows: 2464. Core depot-level maintenance and repair capabilities (a) NECESSITY FOR CORE DEPOT-LEVEL MAINTENANCE AND REPAIR CAPABILITIES. (1) It is essential for national security that the Department of Defense maintain a core depot-level maintenance and repair capability, as defined by this title, in support of mission-essential weapon systems or items of military equipment needed to directly support combatant command operational requirements and enable the armed forces to execute the strategic, contingency, and emergency plans prepared by the Department of Defense, as required under section 153(a) of this title. (2) This core depot-level maintenance and repair capability shall be Governmentowned and Government-operated, including the use of Government personnel and Government-owned and Government-operated equipment and facilities, throughout the lifecycle of the weapon system or item of military equipment involved 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. (3) (A) Except as provided in subsection (c), the Secretary of Defense shall identify and establish the core depot-level maintenance and repair capabilities and capacity required in paragraph (1). (B) Core depot-level maintenance and repair capabilities and capacity, including the facilities, equipment, associated logistics capabilities, technical data, and trained personnel, shall be established not later than four years after a weapon system or item of military equipment achieves initial operational capability or is fielded in support of operations.

(4) The Secretary of Defense shall assign Government-owned and Government-operated depot-level maintenance and repair facilities of the Department of Defense sufficient workload to ensure cost efficiency and technical competence in peacetime, while preserving the ability to provide an effective and timely response to a mobilization, national defense contingency situations, and other emergency requirements. (b) WAIVER AUTHORITY. (1) The Secretary of Defense may waive the requirement in subsection (a)(3) if the Secretary determines that (A) the weapon system or item of military equipment is not an enduring element of the national defense strategy; (B) in the case of nuclear aircraft carrier refueling, fulfilling the requirement is not economically feasible; or (C) it is in the best interest of national security. (2) The Secretary of a military department may waive the requirement in subsection (a)(3) for special access programs if such a waiver is determined to be in the best interest of the United States. (3) The determination to waive requirements in accordance with paragraph (1) or (2) shall be documented and notification submitted to Congress with justification for the waiver within 30 days of issuance. (c) APPLICABILITY TO COMMERCIAL ITEMS. (1)The requirement in subsection (a)(3) shall not apply to items determined to be commercial items. (2) The first time a weapon system or other item of military equipment described in subsection (a) is determined to be a commercial item for the purposes of the exception under subsection (c), 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: (A) The estimated percentage of commonality of parts of the version of the item that is sold or leased in the commercial marketplace and the version of the item to be purchased by the Department of Defense. (B) The value of any unique support and test equipment and tools needed to support the military requirements if the item were maintained by the Department of Defense. (C) A comparison of the estimated life-cycle depot-level maintenance and repair support costs that would be incurred by the Government if the item were maintained by the private sector with the estimated life-cycle depot-level maintenance support costs that would be incurred by the Government if the item were maintained by the Department of Defense. (3) In this subsection, the term commercial item means an end-item, assembly, subassembly, or part sold or leased in substantial quantities to the general public and purchased by the Department of Defense without modification in the same form that they are sold in the commercial marketplace, or with minor modifications to meet Federal Government requirements. (d) LIMITATION ON CONTRACTING. (1) Except as provided in paragraph (2), performance of workload needed to maintain a core depot-level maintenance and repair capability identified by the Secretary under subsection (a)(3) 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 depot-level maintenance and repair 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. (e) BIENNIAL CORE REPORT. Not later than April 1 on 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 subsequent fiscal year 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 the shortfall and a plan either to correct, or mitigate, the effects of the shortfall. (f) ANNUAL CORE REPORT. In 2013 and each year thereafter, not later than 60 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), for the fiscal year preceding the fiscal year during which the report is submitted, each of the following: (1) The core depot-level maintenance and repair capability requirements identified in subsection (a)(3). (2) The workload required to cost-effectively support such requirements. (3) To the maximum extent practicable, the additional workload beyond the workloads identified under subsection (a)(4) needed to ensure that not more than 50 percent of the non-exempt depot maintenance funding is expended for performance by non-federal governmental personnel in accordance with section 2466 of this title. (4) The allocation of workload for each Center of Industrial and Technical Excellence as designated in accordance with section 2474 of this title.

(5) The depot-level maintenance and repair capital investments required to be made in order to ensure compliance with subsection (a)(3) by not later than four years after achieving initial operational capacity. (6) The outcome of a reassessment of continuation of a waiver granted under subsection (b). (g) COMPTROLLER GENERAL REVIEW. The Comptroller General shall review each report required under subsections (e) and (f) for completeness and compliance and provide findings and recommendations to the congressional defense committees not later than 60 days after the report is submitted to Congress.. (b) CLERICAL AMENDMENT. The table of sections at the beginning of chapter 146 of such title is amended by striking the item relating to section 2464 and inserting the following new item: 2464. Core depot-level maintenance and repair capabilities.. TITLE 10 - ARMED FORCES SUBTITLE A - GENERAL MILITARY LAW PART IV - SERVICE, SUPPLY, AND PROCUREMENT CHAPTER 146 - CONTRACTING FOR PERFORMANCE OF CIVILIAN COMMERCIAL OR INDUSTRIAL TYPE FUNCTIONS 2464. Core logistics capabilities Core depot-level maintenance and repair capabilities. (a) Necessity for Core Logistics Capabilities. NECESSITY FOR CORE DEPOT-LEVEL MAINTENANCE AND REPAIR 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. It is essential for national security that the Department of Defense maintain a core depotlevel maintenance and repair capability, as defined by this title, in support of missionessential weapon systems or items of military equipment needed to directly support combatant command operational requirements and enable the armed forces to execute the strategic, contingency, and emergency plans prepared by the Department of Defense, as required under section 153(a) of this title. (2) The Secretary of Defense shall identify the core logistics capabilities described in paragraph (1) and the workload required to maintain those capabilities. This core depot-level maintenance and repair capability shall be Government-owned and Government-operated, including the use of Government personnel and Governmentowned and Government-operated equipment and facilities, throughout the lifecycle of the weapon system or item of military equipment involved 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. (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 items 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. (A) Except as provided in subsection (c), the Secretary of Defense shall identify and establish the core depot-level maintenance and repair capabilities and capacity required in paragraph (1). (B) Core depot-level maintenance and repair capabilities and capacity, including the facilities, equipment, associated logistics capabilities, technical data, and trained personnel, shall be established not later than four years after a weapon system or item of military equipment achieves initial operational capability or is fielded in support of operations. (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). The Secretary of Defense shall assign Government-owned and Government-operated depot-level maintenance and repair facilities of the Department of Defense sufficient workload to ensure cost efficiency and technical competence in peacetime, while preserving the ability to provide an effective and timely response to a mobilization, national defense contingency situations, and other emergency requirements. (5) The commercial items covered by paragraph (3) are commercial items 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) WAIVER AUTHORITY. (1) The Secretary of Defense may waive the requirement in subsection (a)(3) if the Secretary determines that (A) the weapon system or item of military equipment is not an enduring element of the national defense strategy; (B) in the case of nuclear aircraft carrier refueling, fulfilling the requirement is not economically feasible; or (C) it is in the best interest of national security. (2) The Secretary of a military department may waive the requirement in subsection (a)(3) for special access programs if such a waiver is determined to be in the best interest of the United States. (3) The determination to waive requirements in accordance with paragraph (1) or (2) shall be documented and notification submitted to Congress with justification for the waiver within 30 days of issuance. (c) APPLICABILITY TO COMMERCIAL ITEMS. (1)The requirement in subsection (a)(3) shall not apply to items determined to be commercial items. (2) The first time a weapon system or other item of military equipment described in subsection (a) is determined to be a commercial item for the purposes of the exception under subsection (c), 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:

(A) The estimated percentage of commonality of parts of the version of the item that is sold or leased in the commercial marketplace and the version of the item to be purchased by the Department of Defense. (B) The value of any unique support and test equipment and tools needed to support the military requirements if the item were maintained by the Department of Defense. (C) A comparison of the estimated life-cycle depot-level maintenance and repair support costs that would be incurred by the Government if the item were maintained by the private sector with the estimated life-cycle depot-level maintenance support costs that would be incurred by the Government if the item were maintained by the Department of Defense. (3) In this subsection, the term commercial item means an end-item, assembly, subassembly, or part sold or leased in substantial quantities to the general public and purchased by the Department of Defense without modification in the same form that they are sold in the commercial marketplace, or with minor modifications to meet Federal Government requirements. (bd) Limitation on Contracting 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). Except as provided in paragraph (2), performance of workload needed to maintain a core depot-level maintenance and repair capability identified by the Secretary under subsection (a)(3) 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 The Secretary of Defense may waive paragraph (1) in the case of any such depotlevel maintenance and repair 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. (e) BIENNIAL CORE REPORT. Not later than April 1 on 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 subsequent fiscal year 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 the shortfall and a plan either to correct, or mitigate, the effects of the shortfall. (f) ANNUAL CORE REPORT. In 2013 and each year thereafter, not later than 60 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), for the fiscal year preceding the fiscal year during which the report is submitted, each of the following: (1) The core depot-level maintenance and repair capability requirements identified in subsection (a)(3). (2) The workload required to cost-effectively support such requirements. (3) To the maximum extent practicable, the additional workload beyond the workloads identified under subsection (a)(4) needed to ensure that not more than 50 percent of the non-exempt depot maintenance funding is expended for performance by non-federal governmental personnel in accordance with section 2466 of this title. (4) The allocation of workload for each Center of Industrial and Technical Excellence as designated in accordance with section 2474 of this title. (5) The depot-level maintenance and repair capital investments required to be made in order to ensure compliance with subsection (a)(3) by not later than four years after achieving initial operational capacity. (6) The outcome of a reassessment of continuation of a waiver granted under subsection (b). (g) COMPTROLLER GENERAL REVIEW. The Comptroller General shall review each report required under subsections (e) and (f) for completeness and compliance and provide findings and recommendations to the congressional defense committees not later than 60 days after the report is submitted to Congress.. (c) Notification of Determinations Regarding Certain Commercial Items. The first time that a weapon system or other item of military equipment described in subsection (a)(3) is

determined to be a commercial item 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.

IMPLEMENTATION OF RECOMMENDATIONS OF DEFENSE SCIENCE BOARD TASK FORCE ON IMPROVEMENTS TO SERVICE CONTRACTING (SEC. 807) The Senate amendment contained a provision (sec. 822) that would require the Department of Defense to develop a plan to implement the recommendations of a Defense Science Board report on service contracting. The House bill contained no similar provision. The House recedes with an amendment striking language requiring a taxonomy and definitions for the tracking of contract services. This issue has been already addressed in previously-enacted legislation requiring an inventory of contract services. SEC. 807. IMPLEMENTATION OF RECOMMENDATIONS OF DEFENSE SCIENCE BOARD TASK FORCE ON IMPROVEMENTS TO SERVICE CONTRACTING. (a) PLAN FOR IMPLEMENTATION. Not later than 180 days after the date of the enactment of this Act, the Under Secretary of Defense for Acquisition, Technology, and Logistics shall, acting pursuant to the Under Secretary s responsibility under section 2330 of title 10, United States Code, develop a plan for implementing the recommendations of the Defense Science Board Task Force on Improvements to Service Contracting. (b) ELEMENTS. The plan developed pursuant to subsection (a) shall include, to the extent determined appropriate by the Under Secretary for Acquisition, Technology, and Logistics, the following: (1) Meaningful incentives to services contractors for high performance at low cost, consistent with the objectives of the Better Buying Power Initiative established by the Under Secretary. (2) Improved means of communication between the Government and the services contracting industry in the process of developing requirements for services contracts. (3) Clear guidance for defense acquisition personnel on the use of appropriate contract types for particular categories of services contracts. (4) Formal certification and training requirements for services acquisition personnel, consistent with the requirements of sections 1723 and 1724 of title 10, United States Code. (5) Appropriate emphasis on the recruiting and training of services acquisition personnel, consistent with the strategic workforce plan developed pursuant to section 115b of title 10, United States Code, and the funds available through the Department of Defense Acquisition Workforce Development Fund established pursuant to section 1705 of title 10, United States Code. (6) Policies and guidance on career development for services acquisition personnel, consistent with the requirements of sections 1722a and 1722b of title 10, United States Code. (7) Actions to ensure that the military departments dedicate portfolio-specific commodity managers to coordinate the procurement of key categories of contract services, as required by section 2330(b)(3)(C) of title 10, United States Code. (8) Actions to ensure that the Department of Defense conducts realistic exercises and training that account for services contracting during contingency operations, as required by section 2333(e) of title 10, United States Code. (c) COMPTROLLER GENERAL REPORT. Not later than 18 months after the date of the enactment of this Act, the Comptroller General of the United States shall submit to the congressional defense committees a report on the following: (1) The actions taken by the Under Secretary of Defense for Acquisition, Technology, and Logistics to carry out the requirements of this section.