CODIFICATION OF DEFENSE BUSINESS OPERATIONS FUND.

SEC. 371. CODIFICATION OF DEFENSE BUSINESS OPERATIONS FUND. (a) Management of Working-Capital Funds.— (1) Chapter 131 of title 10, United States Code, is amended by inserting after section 2215 the following new section: “§2216. Defense Business Operations Fund “(a) Management of Working-Capital Funds and Certain Activities.— The Secretary of Defense may manage the performance of the working-capital funds and industrial, commercial, and support type activities described in subsection (b) through the fund known as the Defense Business Operations Fund, which is established on the books of the Treasury. Except for the funds and activities specified in subsection (b), no other functions, activities, funds, or accounts of the Department of Defense may be managed or converted to management through the Fund. “(b) Funds and Activities Included.— The funds and activities referred to in subsection (a) are the following: “(1) Working-capital funds established under section 2208 of this title and in existence on December 5, 1991. “(2) Those activities that, on December 5, 1991, were funded through the use of a working-capital fund established under that section. “(3) The Defense Finance and Accounting Service. “(4) The Defense Commissary Agency. “(5) The Defense Reutilization and Marketing Service. “(6) The Joint Logistics Systems Center. “(c) Separate Accounting, Reporting, and Auditing of Funds and Activities.— (1) The Secretary of Defense shall provide in accordance with this subsection for separate accounting, reporting, and auditing of funds and activities managed through the Fund. “(2) The Secretary shall maintain the separate identity of each fund and activity managed through the Fund that (before the establishment of the Fund) was managed as a separate Fund or activity. “(3) The Secretary shall maintain separate records for each function for which payment is made through the Fund and which (before the establishment of the Fund) was paid directly through appropriations, including the separate identity of the appropriation account used to pay for the performance of the function. “(d) Charges for Goods and Services Provided Through the Fund.— (1) Charges for goods and services provided through the Fund shall include the following: “(A) Amounts necessary to recover the full costs of the goods and services, whenever practicable, and the costs of the development, implementation, operation, and maintenance of systems supporting the wholesale supply and maintenance activities of the Department of Defense. “(B) Amounts for depreciation of capital assets, set in accordance with generally accepted accounting principles. 110 STAT. 278 “(C) Amounts necessary to recover the full cost of the operation of the Defense Finance Accounting Service. “(2) Charges for goods and services provided through the Fund may not include the following: “(A) Amounts necessary to recover the costs of a military construction project (as defined in section 2801(b) of this title), other than a minor construction project financed by the Fund pursuant to section 2805(c)(1) of this title. “(B) Amounts necessary to cover costs incurred in connection with the closure or realignment of a military installation. “(C) Amounts necessary to recover the costs of functions designated by the Secretary of Defense as mission critical, such as ammunition handling safety, and amounts for ancillary tasks not directly related to the mission of the function or activity managed through the Fund. “(3) (A) The Secretary of Defense may submit to a customer a bill for the provision of goods and services through the Fund in advance of the provision of those goods and services. “(B) The Secretary shall submit to Congress a report on advance billings made pursuant to subparagraph (A)— “(i) wnen the aggregate amount of all such billings after the date of the enactment of the National Defense Authorization Act for Fiscal Year 1996 reaches $100,000,000; and “(ii) whenever the aggregate amount of all such billings after the date of a preceding report under this subparagraph reaches $100,000,000. “(C) Each report under subparagraph (B) shall include, for each such advance billing, the following: “(i) An explanation of the reason for the advance billing. “(ii) An analysis of the impact of the advance billing on readiness. “(iii) An analysis of the impact of the advance billing on the customer so billed. “(e) Capital Asset Subaccount.— (1) Amounts charged for depreciation of capital assets pursuant to subsection (d)(1)(B) shall be credited to a separate capital asset subaccount established within the Fund. “(2) The Secretary of Defense may award contracts for capital assets of the Fund in advance of the availability of funds in the subaccount. “(f) Procedures For Accumulation of Funds.— The Secretary of Defense shall establish billing procedures to ensure that the balance in the Fund does not exceed the amount necessary to provide for the working capital requirements of the Fund, as determined by the Secretary. “(g) Purchase From Other Sources.— The Secretary of Defense or the Secretary of a military department may purchase goods and services that are available for purchase from the Fund from a source other than the Fund if the Secretary determines that such source offers a more competitive rate for the goods and services than the Fund offers. “(h) Annual Reports and Budget.— The Secretary of Defense shall annually submit to Congress, at the same time that the President submits the budget under section 1105 of title 31, the following: “(1) A detailed report that contains a statement of all receipts and disbursements of the Fund (including such a state-110 STAT. 279ment for each subaccount of the Fund) for the fiscal year ending in the year preceding the year in which the budget is submitted. “(2) A detailed proposed budget for the operation of the Fund for the fiscal year for which the budget is submitted. “(3) A comparison of the amounts actually expended for the operation of the Fund for the fiscal year referred to in paragraph (1) with the amount proposed for the operation of the Fund for that fiscal year in the President’s budget. “(4) A report on the capital asset subaccount of the Fund that contains the following information: “(A) The opening balance of the subaccount as of the beginning of the fiscal year in which the report is submitted. “(B) The estimated amounts to be credited to the sub-account in the fiscal year in which the report is submitted. “(C) The estimated amounts of outlays to be paid out of the subaccount in the fiscal year in which the report is submitted. “(D) The estimated balance of the subaccount at the end of the fiscal year in which the report is submitted. “(E) A statement of how much of the estimated balance at the end of the fiscal year in which the report is submitted will be needed to pay outlays in the immediately following fiscal year that are in excess of the amount to be credited to the subaccount in the immediately following fiscal year. “(i) Definitions.— In this section: “(1) The term ‘capital assets’ means the following capital assets that have a development or acquisition cost of not less than $50,000: “(A) Minor construction projects financed by the Fund pursuant to section 2805(c)(1) of this title. “(B) Automatic data processing equipment, software. “(C) Equipment other than equipment described in subparagraph (B). “(D) Other capital improvements. “(2) The term ‘Fund’ means the Defense Business Operations Fund.”. (2) The table of sections at the beginning of such chapter is amended by inserting after the item relating to section 2215 the following new item: “2216. Defense Business Operations Fund.”. (b) Conforming Repeals.— The following provisions of law are hereby repealed: (1) Subsections (b), (c), (d), and (e) of section 311 of the National Defense Authorization Act for Fiscal Year 1995 (Public Law 103–337; 10 U.S.C. 2208 note). (2) Subsections (a) and (b) of section 333 of the National Defense Authorization Act for Fiscal Year 1994 (Public Law 103–160; 10 U.S.C. 2208 note). (3) Section 342 of the National Defense Authorization Act for Fiscal Year 1993 (Public Law 102–484; 10 U.S.C. 2208 note). (4) Section 316 of the National Defense Authorization Act for Fiscal Years 1992 and 1993 (Public Law 102–190; 10 U.S.C. 2208 note). 110 STAT. 280 (5) Section 8121 of the Department of Defense Appropriations Act, 1992 (Public Law 102–172; 10 U.S.C. 2208 note).