INCENTIVES FOR INNOVATION

SEC. 806. INCENTIVES FOR INNOVATION (a) In General.—(1) Section 2305(d) of title 10, United States Code, is amended by adding at the end the following: “(4) (A) Whenever the head of an agency requires that proposals described in paragraph (1)(B) or (2)(B) be submitted by an offeror in its offer, the offeror shall not be required to provide a proposal that enables the United States to acquire competitively in the future an identical item if the item was developed exclusively at private expense unless the head of the agency determines that— “(i) the original supplier of such item will be unable to satisfy program schedule or delivery requirements; or “(ii) proposals by the original supplier of such item to meet the mobilization requirements are insufficient to meet the agency’s mobilization needs. “(B) In considering offers in response to a solicitation requiring proposals described in paragraph (1)(B) or (2)(B), the head of an agency shall base any evaluation of items developed exclusively at private expense on an analysis of the total value, in terms of innovative design, life-cycle costs, and other pertinent factors, of incorporating such items in the system.”. (2) Section 2305(d)(3) of such title is amended by adding at the end the following: “Such objectives may not impair the rights of prospective contractors or subcontractors otherwise provided by law.”. (b) Clarifying Amendment.—Paragraphs (1)(B) and (2)(B) of section 2305(d) of such title are each amended by striking out “The proposals” and all that follows through “contract are” and inserting 102 STAT. 2011in lieu thereof “Proposals referred to in the first sentence of subparagraph (A) are”.