Sec. 1283. Review and report on use and management of administrative surcharges under the foreign military sales program
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The Secretary of Defense, acting through the Director of the Defense Security Cooperation Agency, shall review options for expanding the use of administrative surcharges under the foreign military sales program, including practices for managing administrative surcharges and contract administrative services surcharges. The review conducted under paragraph
(1)shall include the following: A determination of which specific expenses are incurred by the United States Government in operation of the foreign military sales program that the administrative surcharge does not currently pay for. The estimated annual cost of each of such specific expenses. An assessment of the costs and benefits of funding such specific expenses through the administrative surcharge, including any data to support such an assessment. An assessment of how the Department of Defense could calculate an upper bound of a target range for the administrative surcharge account and the contract administration services surcharge account, including an assessment of the costs and benefits of setting such a bound. An assessment of how the Department of Defense calculates the lower bound, or safety level, for the administrative surcharge account and the contract administration services surcharge account, including what specific factors inform the calculation and whether such a method for calculating the safety level is still valid or should be revisited. An assessment of the process used by the Department of Defense to review and set rates for the administrative surcharge and the contract administration services surcharge, including the extent to which outside parties are consulted and any proposals of the Department of Defense may have for better ensuring that the fee rates are set appropriately. Such other matters as the Secretary of Defense determines to be appropriate. Not later than 120 days after the date of the enactment of this Act, the Secretary of Defense, acting through the Director of the Defense Security Cooperation Agency, shall submit to the congressional defense committees a report on— the findings of the review conducted under paragraph (1); and any legislative changes needed to allow the surcharge under the foreign military sales program to pay for any expenses currently not covered by administrative surcharge under the foreign military sales program.