CONTRACT AUTHORITY FOR ADVANCED COMPONENT DEVELOPMENT OR PROTOTYPE UNITS.

SEC. 819. CONTRACT AUTHORITY FOR ADVANCED COMPONENT DEVELOPMENT OR PROTOTYPE UNITS.(a) Authority.—A contract initially awarded from the competitive selection of a proposal resulting from a general solicitation referred to in section 2302(2)(B) of title 10, United States Code, may contain a contract line item or contract option for—(1) the provision of advanced component development or prototype of technology developed under the contract; or(2) the delivery of initial or additional prototype items if the item or a prototype thereof is created as the result of work performed under the contract.(b) Limitations.—(1) Minimal amount.—A contract line item or contract option described in subsection (a)(2) shall require the delivery of the minimal amount of initial or additional prototype items to allow for the timely competitive solicitation and award of a follow-on development or production contract for those items.(2) Term.—A contract line item or contract option described in subsection (a) shall be for a term of not more than 12 months.(3) Dollar value of work.—The dollar value of the work to be performed pursuant to a contract line item or contract option described in subsection (a) may not exceed the lesser of the amounts as follows:(A) The amount that is three times the dollar value of the work previously performed under the contract.(B) $20,000,000.(4) Termination of authority.—A military department or defense agency may not exercise a contract line item or contract option pursuant to the authority provided in subsection (a) after September 30, 2014.(c) Report.—The Secretary of Defense shall submit to the congressional defense committees a report on the use of the 123 STAT. 2410 authority provided by subsection (a) not later than March 1, 2013. The report shall, at a minimum, describe—(1) the number of times a contract line item or contract option was exercised under such authority, the dollar amount of each such line item or option, and the scope of each such line item or option;(2) the circumstances that rendered the military department or defense agency unable to solicit and award a follow-on development or production contract in a timely fashion, but for the use of such authority;(3) the extent to which such authority affected competition and technology transition; and(4) such recommendations as the Secretary considers appropriate, including any recommendations regarding the modification or extension of such authority.