
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 10USC2464]

 
                         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
 
Sec. 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 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.
    (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 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) 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 
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.

(Added Pub. L. 100-370, Sec. 2(a)(1), July 19, 1988, 102 Stat. 853; 
amended Pub. L. 101-189, div. A, title XVI, Sec. 1622(c)(7), Nov. 29, 
1989, 103 Stat. 1604; Pub. L. 104-106, div. A, title III, Sec. 314, Feb. 
10, 1996, 110 Stat. 251; Pub. L. 105-85, div. A, title III, Sec. 356(a), 
Nov. 18, 1997, 111 Stat. 1694; Pub. L. 105-261, div. A, title III, 
Sec. 343(a), Oct. 17, 1998, 112 Stat. 1976; Pub. L. 106-65, div. A, 
title X, Sec. 1067(1), Oct. 5, 1999, 113 Stat. 774.)


                      Historical and Revision Notes

    Section is based on Pub. L. 98-525, title III, Sec. 307, Oct. 19, 
1984, 98 Stat. 2514, as amended by Pub. L. 99-145, title XII, 
Sec. 1231(f), Nov. 8, 1985, 99 Stat. 733.


                               Amendments

    1999--Subsec. (b)(3)(A). Pub. L. 106-65 substituted ``and the 
Committee on Armed Services'' for ``and the Committee on National 
Security''.
    1998--Subsec. (c). Pub. L. 105-261 added subsec. (c).
    1997--Pub. L. 105-85 substituted ``capabilities'' for ``functions'' 
in section catchline and amended text generally. Prior to amendment, 
text related to necessity for core logistics capabilities and restricted 
contracting out of certain logistics activities and functions of the 
Department of Defense to non-Government personnel.
    1996--Subsec. (b)(3), (4). Pub. L. 104-106 added par. (3) and struck 
out former pars. (3) and (4) which read as follows:
    ``(3) A waiver under paragraph (2) may not take effect until--
        ``(A) the Secretary submits a report on the waiver to the 
    Committees on Armed Services and the Committees on Appropriations of 
    the Senate and House of Representatives; and
        ``(B) a period of 20 days of continuous session of Congress or 
    40 calendar days has passed after the receipt of the report by those 
    committees.
    ``(4) For purposes of paragraph (3)(B), the continuity of a session 
of Congress is broken only by an adjournment sine die, and 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 such 
20-day period.''
    1989--Subsec. (b)(3)(A). Pub. L. 101-189 substituted ``Committees on 
Appropriations'' for ``Committee on Appropriations''.


                    Effective Date of 1998 Amendment

    Pub. L. 105-261, div. A, title III, Sec. 343(b), Oct. 17, 1998, 112 
Stat. 1976, provided that: ``Subsection (c) of section 2464 of title 10, 
United States Code (as added by subsection (a)), shall apply with 
respect to determinations made after the date of the enactment of this 
Act [Oct. 17, 1998].''


   Conditions on Expansion of Functions Performed Under Prime Vendor 
            Contracts for Depot-Level Maintenance and Repair

    Pub. L. 105-261, div. A, title III, Sec. 346, Oct. 17, 1998, 112 
Stat. 1979, as amended by Pub. L. 106-65, div. A, title III, Sec. 336, 
Oct. 5, 1999, 113 Stat. 568, provided that:
    ``(a) Conditions on Expanded Use.--The Secretary of Defense or the 
Secretary of a military department, as the case may be, may not enter 
into a prime vendor contract for depot-level maintenance and repair of a 
weapon system or other military equipment described in section 
2464(a)(3) of title 10, United States Code, before the end of the 30-day 
period beginning on the date on which the Secretary submits to Congress 
a report, specific to the proposed contract, that--
        ``(1) describes the competitive procedures to be used to award 
    the prime vendor contract;
        ``(2) contains an analysis of costs and benefits that 
    demonstrates that use of the prime vendor contract will result in 
    savings to the Government over the life of the contract;
        ``(3) contains an analysis of the extent to which the contract 
    conforms to the requirements of section 2466 of title 10, United 
    States Code; and
        ``(4) describes the measures taken to ensure that the contract 
    does not violate the core logistics policies, requirements, and 
    restrictions set forth in section 2464 of that title.
    ``(b) Definitions.--In this section:
        ``(1) The term `prime vendor contract' means an innovative 
    contract that gives a defense contractor the responsibility to 
    manage, store, and distribute inventory, manage and provide 
    services, or manage and perform research, on behalf of the 
    Department of Defense on a frequent, regular basis, for users within 
    the Department on request. The term includes contracts commonly 
    referred to as prime vendor support contracts, flexible sustainment 
    contracts, and direct vendor delivery contracts.
        ``(2) The term `depot-level maintenance and repair' has the 
    meaning given such term in section 2460 of title 10, United States 
    Code.
    ``(c) Relationship to Other Laws.--Nothing in this section shall be 
construed to exempt a prime vendor contract from the requirements of 
section 2461 of title 10, United States Code, or any other provision of 
chapter 146 of such title.''


 Policy Regarding Performance of Depot-Level Maintenance and Repair for 
                          Department of Defense

    Section 311 of Pub. L. 104-106, as amended by Pub. L. 105-85, div. 
A, title III, Sec. 363, Nov. 18, 1997, 111 Stat. 1702, provided that:
    ``(a) Findings.--Congress makes the following findings:
        ``(1) The Department of Defense does not have a comprehensive 
    policy regarding the performance of depot-level maintenance and 
    repair of military equipment.
        ``(2) The absence of such a policy has caused the Congress to 
    establish guidelines for the performance of such functions.
        ``(3) It is essential to the national security of the United 
    States that the Department of Defense maintain an organic capability 
    within the department, including skilled personnel, technical 
    competencies, equipment, and facilities, to perform depot-level 
    maintenance and repair of military equipment in order to ensure that 
    the Armed Forces of the United States are able to meet training, 
    operational, mobilization, and emergency requirements without 
    impediment.
        ``(4) The organic capability of the Department of Defense to 
    perform depot-level maintenance and repair of military equipment 
    must satisfy known and anticipated core maintenance and repair 
    requirements across the full range of peacetime and wartime 
    scenarios.
        ``(5) Although it is possible that savings can be achieved by 
    contracting with private-sector sources for the performance of some 
    work currently performed by Department of Defense depots, the 
    Department of Defense has not determined the type or amount of work 
    that should be performed under contract with private-sector sources 
    nor the relative costs and benefits of contracting for the 
    performance of such work by those sources.
    ``(b) Sense of Congress.--It is the sense of Congress that there is 
a compelling need for the Department of Defense to articulate known and 
anticipated core maintenance and repair requirements, to organize the 
resources of the Department of Defense to meet those requirements 
economically and efficiently, and to determine what work should be 
performed by the private sector and how such work should be managed.
    ``(c) Requirement for Policy.--Not later than March 31, 1996, the 
Secretary of Defense shall develop and report to the Committee on Armed 
Services of the Senate and the Committee on National Security of the 
House of Representatives [now Committee on Armed Services of the House 
of Representatives] a comprehensive policy on the performance of depot-
level maintenance and repair for the Department of Defense that 
maintains the capability described in section 2464 of title 10, United 
States Code.
    ``(d) Content of Policy.--In developing the policy, the Secretary of 
Defense shall do each of the following:
        ``(1) Identify for each military department, with the 
    concurrence of the Secretary of that military department, those 
    depot-level maintenance and repair activities that are necessary to 
    ensure the depot-level maintenance and repair capability as required 
    by section 2464 of title 10, United States Code.
        ``(2) Provide for performance of core depot-level maintenance 
    and repair capabilities in facilities owned and operated by the 
    United States.
        ``(3) Provide for the core capabilities to include sufficient 
    skilled personnel, equipment, and facilities that--
            ``(A) is of the proper size (i) to ensure a ready and 
        controlled source of technical competence and repair and 
        maintenance capability necessary to meet the requirements of the 
        National Military Strategy and other requirements for responding 
        to mobilizations and military contingencies, and (ii) to provide 
        for rapid augmentation in time of emergency; and
            ``(B) is assigned sufficient workload to ensure cost 
        efficiency and technical proficiency in time of peace.
        ``(4) Address environmental liability.
        ``(5) In the case of depot-level maintenance and repair 
    workloads in excess of the workload required to be performed by 
    Department of Defense depots, provide for competition for those 
    workloads between public and private entities when there is 
    sufficient potential for realizing cost savings based on adequate 
    private-sector competition and technical capabilities.
        ``(6) Address issues concerning exchange of technical data 
    between the Federal Government and the private sector.
        ``(7) Provide for, in the Secretary's discretion and after 
    consultation with the Secretaries of the military departments, the 
    transfer from one military department to another, in accordance with 
    merit-based selection processes, workload that supports the core 
    depot-level maintenance and repair capabilities in facilities owned 
    and operated by the United States.
        ``(8) Require that, in any competition for a workload (whether 
    among private-sector sources or between depot-level activities of 
    the Department of Defense and private-sector sources), bids are 
    evaluated under a methodology that ensures that appropriate costs to 
    the Government and the private sector are identified.
        ``(9) Provide for the performance of maintenance and repair for 
    any new weapons systems defined as core, under section 2464 of title 
    10, United States Code, in facilities owned and operated by the 
    United States.
    ``(e) Considerations.--In developing the policy, the Secretary shall 
take into consideration the following matters:
        ``(1) The national security interests of the United States.
        ``(2) The capabilities of the public depots and the capabilities 
    of businesses in the private sector to perform the maintenance and 
    repair work required by the Department of Defense.
        ``(3) Any applicable recommendations of the Defense Base Closure 
    and Realignment Commission that are required to be implemented under 
    the Defense Base Closure and Realignment Act of 1990 [part A of 
    title XXIX of div. B of Pub. L. 101-510, set out as a note under 
    section 2687 of this title].
        ``(4) The extent to which the readiness of the Armed Forces 
    would be affected by a necessity to construct new facilities to 
    accommodate any redistribution of depot-level maintenance and repair 
    workloads that is made in accordance with the recommendation of the 
    Defense Base Closure and Realignment Commission, under the Defense 
    Base Closure and Realignment Act of 1990, that such workloads be 
    consolidated at Department of Defense depots or private-sector 
    facilities.
        ``(5) Analyses of costs and benefits of alternatives, including 
    a comparative analysis of--
            ``(A) the costs and benefits, including any readiness 
        implications, of any proposed policy to convert to contractor 
        performance of depot-level maintenance and repair workloads 
        where the workload is being performed by Department of Defense 
        personnel; and
            ``(B) the costs and benefits, including any readiness 
        implications, of a policy to transfer depot-level maintenance 
        and repair workloads among depots.
    ``[(f), (g) Repealed. Pub. L. 105-85, div. A, title III, Sec. 363, 
Nov. 18, 1997, 111 Stat. 1702.]
    ``(h) Review by General Accounting Office.--(1) The Secretary shall 
make available to the Comptroller General of the United States all 
information used by the Department of Defense in developing the policy 
under subsections (c) through (e) of this section.
    ``(2) Not later than 45 days after the date on which the Secretary 
submits to Congress the report required by subsection (c), the 
Comptroller General shall transmit to Congress a report containing a 
detailed analysis of the Secretary's proposed policy as reported under 
such subsection.
    ``(i) Report on Depot-Level Maintenance and Repair Workload.--Not 
later than March 31, 1996, the Secretary of Defense shall submit to 
Congress a report on the depot-level maintenance and repair workload of 
the Department of Defense. The report shall, to the maximum extent 
practicable, include the following:
        ``(1) An analysis of the need for and effect of the requirement 
    under section 2466 of title 10, United States Code, that no more 
    than 40 percent of the depot-level maintenance and repair work of 
    the Department of Defense be contracted for performance by non-
    Government personnel, including a description of the effect on 
    military readiness and the national security resulting from that 
    requirement and a description of any specific difficulties 
    experienced by the Department of Defense as a result of that 
    requirement.
        ``(2) An analysis of the distribution during the five fiscal 
    years ending with fiscal year 1995 of the depot-level maintenance 
    and repair workload of the Department of Defense between depot-level 
    activities of the Department of Defense and non-Government 
    personnel, measured by direct labor hours and by amounts expended, 
    and displayed, for that five-year period and for each year of that 
    period, so as to show (for each military department (and separately 
    for the Navy and Marine Corps)) such distribution.
        ``(3) A projection of the distribution during the five fiscal 
    years beginning with fiscal year 1997 of the depot-level maintenance 
    and repair workload of the Department of Defense between depot-level 
    activities of the Department of Defense and non-Government 
    personnel, measured by direct labor hours and by amounts expended, 
    and displayed, for that five-year period and for each year of that 
    period, so as to show (for each military department (and separately 
    for the Navy and Marine Corps)) such distribution that would be 
    accomplished under a new policy as required under subsection (c).
    ``(j) Other Review by General Accounting Office.--(1) The 
Comptroller General of the United States shall conduct an independent 
audit of the findings of the Secretary of Defense in the report under 
subsection (i). The Secretary of Defense shall provide to the 
Comptroller General for such purpose all information used by the 
Secretary in preparing such report.
    ``(2) Not later than 45 days after the date on which the Secretary 
of Defense submits to Congress the report required under subsection (i), 
the Comptroller General shall transmit to Congress a report containing a 
detailed analysis of the report submitted under that subsection.''

                  Section Referred to in Other Sections

    This section is referred to in section 2469a of this title.
