- § 1431. Authorization; official approval; Congressional action: notification of committees of certain proposed obligations, resolution of disapproval, continuity of session, computation of period
- § 1432. Restrictions
- § 1433. Public record; examination of records by Comptroller General; exemptions: exceptional conditions; reports to Congress
- § 1434. Repealed.
- § 1435. Effective period
- § 1436. Repealed.
§ 1431. Authorization; official approval; Congressional action: notification of committees of certain proposed obligations, resolution of disapproval, continuity of session, computation of period
(a) The President may authorize any department or agency of the Government which exercises functions in connection with the national defense, acting in accordance with regulations prescribed by the President for the protection of the Government, to enter into contracts or into amendments or modifications of contracts heretofore or hereafter made and to make advance payments thereon, without regard to other provisions of law relating to the making, performance, amendment, or modification of contracts, whenever he deems that such action would facilitate the national defense. The authority conferred by this section shall not be utilized to obligate the United States in an amount in excess of $500,000 without approval by an official at or above the level of an Assistant Secretary or his Deputy, or an assistant head or his deputy, of such department or agency, or by a Contract Adjustment Board established therein. The authority conferred by this section may not be utilized to obligate the United States in an amount in excess of $150,000,000 unless the Committees on Armed Services of the Senate and the House of Representatives and in addition, the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate with respect to contracts, or modifications or amendments to contracts, or advance payments proposed to be made under this section by the Secretary of the Department in which the Coast Guard is operating with respect to the acquisition of Coast Guard cutters or aircraft, have been notified in writing of such proposed obligation and 60 days of continuous session of Congress have expired following the date on which such notice was transmitted to such Committees. For purposes of this section, the continuity of a session of Congress is broken only by an adjournment of the Congress sine die at the end of a Congress, and the days on which either House is not in session because of an adjournment of more than 3 days to a day certain, or because of an adjournment sine die other than at the end of a Congress, are excluded in the computation of such 60-day period.
(b)Temporary Authority to Modify Certain Contracts and Options Based on the Impacts of Inflation.—Only amounts specifically provided by an appropriations Act for the purposes detailed in subsections (c) and (d) of this section may be used by the Secretary of Defense to carry out such subsections. If any such amounts are so specifically provided, the Secretary may use them for such purposes.
(c)
(1) The Secretary of Defense, acting pursuant to a Presidential authorization under subsection (a) and in accordance with subsection (b)—
(A) may, notwithstanding subsection (e) of section 1432 of this title, make an amendment or modification to an eligible contract when, due solely to economic inflation, the cost to a prime contractor of performing such eligible contract is greater than the price of such eligible contract; and
(B) may not request consideration from such prime contractor for such amendment or modification.
(2) A prime contractor may submit to the Secretary of Defense a request for an amendment or modification to an eligible contract pursuant to subsection (a) when, due solely to economic inflation, the cost to a covered subcontractor of performing an eligible subcontract is greater than the price of such eligible subcontract. Such request shall include a certification that the prime contractor—
(A) will remit to such covered subcontractor the difference, if any, between the original price of such eligible contract and the price of such eligible contract if the Secretary of Defense makes an amendment or modification pursuant to subsection (a); and
(B) will not require such covered subcontractor to pay additional consideration or fees related to such amendment or modification.
(3) If a prime contractor does not make the request described in paragraph (2), a covered subcontractor may submit to a contracting officer of the Department of Defense a request for an amendment or modification to an eligible subcontract when, due solely to economic inflation, the cost to such covered subcontractor of performing such eligible subcontract is greater than the price of such eligible subcontract.
(d) Any adjustment or modification made pursuant to subsection (c) to an eligible contract or an eligible subcontract shall—
(1) be contingent upon the continued performance, as applicable, of such eligible contract or such eligible subcontract; and
(2) account only for the actual cost of performing such eligible contract or such eligible subcontract, but may account for indirect costs of performance, as the Secretary of Defense determines appropriate.
(e) The authority under subsections (c) and (d) shall be effective during the period beginning on December 23, 2022, and ending on December 31, 2024.
(f) In this section:
(1) The term “covered subcontractor” means a subcontractor who has entered into an eligible subcontract with a prime contractor.
(2) The term “eligible contract” means a contract awarded to a prime contractor by the Secretary of Defense pursuant to subsection (a).
(3) The term “eligible subcontract” means a subcontract made under an eligible contract to a covered subcontractor.
(Pub. L. 85–804, § 1, Aug. 28, 1958, 72 Stat. 972; Pub. L. 93–155, title VIII, § 807(a), Nov. 16, 1973, 87 Stat. 615; Pub. L. 101–510, div. A, title XIII, § 1313, Nov. 5, 1990, 104 Stat. 1670; Pub. L. 102–25, title VII, § 705(f), Apr. 6, 1991, 105 Stat. 120; Pub. L. 116–92, div. C, title XXXV, § 3507(c), Dec. 20, 2019, 133 Stat. 1976; Pub. L. 117–263, div. A, title VIII, § 822(a), Dec. 23, 2022, 136 Stat. 2709; Pub. L. 118–31, div. A, title VIII, § 824, Dec. 22, 2023, 137 Stat. 332.)
§ 1432. Restrictions
Nothing in this chapter shall be construed to constitute authorization hereunder for—
(a) the use of the cost-plus-a-percentage-of-cost system of contracting;
(b) any contract in violation of existing law relating to limitation of profits;
(c) the negotiation of purchases of or contracts for property or services required by law to be procured by formal advertising and competitive bidding;
(d) the waiver of any bid, payment, performance, or other bond required by law;
(e) the amendment of a contract negotiated under section 2304(a)(15) 1
1 See References in Text note below.
of title 10 or under section 252(c)(13) 1 of title 41, to increase the contract price to an amount higher than the lowest rejected bid of any responsible bidder; or(f) the formalization of an informal commitment, unless it is found that at the time the commitment was made it was impracticable to use normal procurement procedures.
(Pub. L. 85–804, § 2, Aug. 28, 1958, 72 Stat. 972.)
§ 1433. Public record; examination of records by Comptroller General; exemptions: exceptional conditions; reports to Congress
(a) All actions under the authority of this chapter shall be made a matter of public record under regulations prescribed by the President and when deemed by him not to be detrimental to the national security.
(b) All contracts entered into, amended, or modified pursuant to authority contained in this chapter shall include a clause to the effect that the Comptroller General of the United States or any of his duly authorized representatives shall, until the expiration of three years after final payment, have access to and the right to examine any directly pertinent books, documents, papers, and records of the contractor or any of his subcontractors engaged in the performance of and involving transactions related to such contracts or subcontracts. Under regulations to be prescribed by the President, however, such clause may be omitted from contracts with foreign contractors or foreign subcontractors if the agency head determines, with the concurrence of the Comptroller General of the United States or his designee, that the omission will serve the best interests of the United States. However, the concurrence of the Comptroller General of the United States or his designee is not required for the omission of such clause—
(1) where the contractor or subcontractor is a foreign government or agency thereof or is precluded by the laws of the country involved from making its books, documents, papers, or records available for examination; and
(2) where the agency head determines, after taking into account the price and availability of the property or services from United States sources, that the public interest would be best served by the omission of the clause.
If the clause is omitted based on a determination under clause (2), a written report shall be furnished to the Congress.
(Pub. L. 85–804, § 3, Aug. 28, 1958, 72 Stat. 972; Pub. L. 89–607, § 3, Sept. 27, 1966, 80 Stat. 851.)
§ 1434. Repealed. Pub. L. 105–362, title IX, § 901(r)(1)(A), Nov. 10, 1998, 112 Stat. 3291
§ 1435. Effective period
This chapter shall be effective only during a national emergency declared by Congress or the President and for six months after the termination thereof or until such earlier time as Congress, by concurrent resolution, may designate.
(Pub. L. 85–804, § 4, formerly § 5, Aug. 28, 1958, 72 Stat. 973; renumbered § 4, Pub. L. 105–362, title IX, § 901(r)(1)(B), Nov. 10, 1998, 112 Stat. 3291.)
§ 1436. Repealed. Pub. L. 97–295, § 6(b), Oct. 12, 1982, 96 Stat. 1314