Sec. 1285. PILOT PROGRAM ON REPAIR, OVERHAUL, AND REFURBISHMENT OF DEFENSE ARTICLES FOR SALE OR TRANSFER TO ELIGIBLE FOREIGN COUNTRIES AND ENTITIES

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## SEC. 1285 PILOT PROGRAM ON REPAIR, OVERHAUL, AND REFURBISHMENT OF DEFENSE ARTICLES FOR SALE OR TRANSFER TO ELIGIBLE FOREIGN COUNTRIES AND ENTITIES **[**[22 U.S.C. 2753 note](/us/usc/t22/s2753)**]** ###

(a)Pilot Program Authorized The Secretary of Defense may carry out a pilot program to repair, overhaul, or refurbish in-stock defense articles in anticipation of the sale or transfer of such defense articles to eligible foreign countries or international organizations under law. ###

(b)Fund for Support of Program Authorized The Secretary of Defense may establish and administer a fund to be known as the “Special Defense Repair Fund” (in this section referred to as the “Fund”) to support the program authorized by subsection (a). ###

(c)Credits to Fund ####

(1)In general Subject to paragraphs

(2)and (3), the following shall be credited to the Fund: #####

(A)Such amounts, not to exceed $50,000,000, from amounts authorized to be appropriated for overseas contingency operations for fiscal year 2013 as the Secretary of Defense considers appropriate, and reprogrammed under a reprogramming authority provided by another provision of this Act or by other law. #####

(B)Notwithstanding section 114(c) of title 10, United States Code, any collection from the sale or transfer of defense articles from Department of Defense stocks repaired, overhauled, or refurbished with amounts from the Fund that are not intended to be replaced which sale or transfer is made pursuant to section 21(a)(1)(A) of the Arms Export Control Act (22 U.S.C. 2761(a)(1)(A)), the Foreign Assistance Act of 1961 (22 U.S.C. 2151 et seq.), or another provision of law. #####

(C)Notwithstanding section 37(a) of the Arms Export Control Act (22 U.S.C. 2777(a)), any cash payment from the sale or transfer of defense articles from Department of Defense stocks repaired, overhauled, or refurbished with amounts from the Fund that are intended to be replaced. ####

(2)Limitation on amounts creditable from sale or transfer of articles #####

(A)Credits in connection with articles not to be replaced The amount credited to the Fund under paragraph (1)(B) in connection with a collection from the sale or transfer of defense articles may not exceed the cost incurred by the Department of Defense in repairing, overhauling, or refurbishing such defense articles under the program authorized by subsection (a). #####

(B)Credits in connection with articles to be replaced The amount credited to the Fund under paragraph (1)(C) in connection with a sale or transfer of defense articles may not exceed the amounts from the Fund used to repair, overhaul, or refurbish such defense articles. ####

(3)Limitation on size of fund The total amount in the Fund at any time may not exceed $50,000,000. ####

(4)Treatment of amounts credited Amounts credited to the Fund under this subsection shall be merged with amounts in the Fund, and shall remain available until expended. ####

(5)Authorization to purchase services from dod working capital fund activities The Fund shall be considered an authorized customer of Department of Defense Working Capital Fund activities. Prices of goods and services sold by Working Capital Fund activities to the Fund shall reflect Foreign Military Sales pricing guidelines, as promulgated by the Department of Defense Financial Management Regulation, and other applicable guidelines. ###

(d)Nonavailability of Amounts in Fund for Storage, Maintenance, and Related Costs Following the repair, overhaul, or refurbishment of defense articles under the program authorized by subsection (a), amounts in the Fund may not be used to pay costs of storage and maintenance of such defense articles or any other costs associated with the preservation or preparation for sale or transfer of such defense articles. ###

(e)Sales or Transfers of Defense Articles ####

(1)In general Any sale or transfer of defense articles repaired, overhauled, or refurbished under the program authorized by subsection

(a)shall be in accordance with— #####

(A)the Arms Export Control Act (22 U.S.C. 2751 et seq.); #####

(B)the Foreign Assistance Act of 1961; or #####

(C)another provision of law authorizing such sale or transfer. ####

(2)Secretary of state concurrence required for certain sales or transfers to foreign countries If the sale or transfer of defense articles occurs in accordance with a provision of law referred to in paragraph (1)(C) that does not otherwise require the concurrence of the Secretary of State for the sale or transfer, the sale or transfer may be made only with the concurrence of the Secretary of State. ###

(f)Transfers of Amounts ####

(1)Transfer to other department of defense accounts Amounts in the Fund may be transferred to any Department of Defense account for use in carrying out the program authorized by subsection (a). Any amount so transferred shall be merged with amounts in the account to which transferred, and shall be available for the same purposes and the same time period as amounts in the account to which transferred. ####

(2)Transfer from other department of defense accounts Upon a determination by the Secretary of Defense with respect to an amount transferred under paragraph

(1)that all or part of such transfer is not necessary for the purposes transferred, such amount may be transferred back to the Fund. Any amount so transferred shall be merged with amounts in the Fund, and shall remain available until expended. ###

(g)Certain Excess Proceeds To Be Credited to Special Defense Acquisition Fund Any collection from the sale or transfer of defense articles that are not intended to be replaced in excess of the amount creditable to the Fund under subsection (c)(2)(A) shall be credited to the Special Defense Acquisition Fund established pursuant to chapter 5 of the Arms Export Control Act (22 U.S.C. 2795 et seq.). ###

(h)Materiel Efficiencies and Duplication In administering the program authorized by subsection (a), the Secretary of Defense shall ensure to the maximum extent possible that purchases made utilizing the Fund utilize existing Defense Logistics Agency contracts. The Secretary shall also ensure that none of the activities carried out under the program authorized by subsection

(a)are duplicative in nature to those performed by other military departments or Defense Agencies. ###

(i)Conduct by Public or Private Sector Facilities or Entities The repair, overhaul, and refurbishment of defense articles under the program authorized by subsection

(a)may be conducted by a facility or entity in the public sector or the private sector, consistent with the requirements of chapter 146 of title 10, United States Code. ###

(j)Reports ####

(1)Annual report Not later than 45 days after the end of each fiscal year through the date of expiration specified in subsection (l), the Secretary of Defense shall submit to the appropriate congressional committees a report on the authorities under this section during such fiscal year. Each report shall include, for the fiscal year covered by such report, the following: #####

(A)The types and quantities of defense articles repaired, overhauled, or refurbished under the program authorized by subsection (a). #####

(B)The value of the repair, overhaul, or refurbishment performed under the program. #####

(C)The amount of operation and maintenance funds credited to the Fund under subsection (c)(1)(A). #####

(D)The amount of any collections from the sale or transfer of defense articles repaired, overhauled, or refurbished under the program that was credited to the Fund under subsection (c)(1)(B). #####

(E)The amount of any cash payments from the sale or transfer of defense articles repaired, overhauled, or refurbished under the program that was credited to the Fund under subsection (c)(1)(C). ####

(2)Assessment report Not later than February 1, 2015, the Secretary of Defense shall submit to the appropriate congressional committees a report on the operation of the authorities in this section. The report shall include an assessment of the effectiveness of the authorities in meeting the objectives of the program authorized by subsection (a). At a minimum, the assessment shall address the following: #####

(A)Cost efficiencies generated by utilization of the Fund. #####

(B)Time efficiencies gained in the delivery of defense articles under the program. #####

(C)An explanation of all amounts transferred to and from the Fund pursuant to subsection (f). #####

(D)A detailed account of excess proceeds credited to the Special Defense Acquisition Fund pursuant to section (g). #####

(E)A list of defense articles, by quantity and type, repaired under the program and an identification of the foreign countries or international organizations to which the repaired defense articles were sold or transferred. ####

(3)Appropriate congressional committees defined In this subsection, the term “appropriate congressional committees” means— #####

(A)the congressional defense committees; and #####

(B)the Committee on Foreign Relations of the Senate and the Committee on Foreign Affairs of the House of Representatives. ###

(k)Defense Article Defined In this section, the term “defense article” has the meaning given that term in section 47(3) of the Arms Export Control Act (22 U.S.C. 2794(3)). ###

(l)Expiration of Authority The authority to carry out the program authorized by subsection (a), and to use amounts in the Fund in support of the program, shall expire on September 30, 2015.

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Sec. 1285

PILOT PROGRAM ON REPAIR, OVERHAUL, AND REFURBISHMENT OF DEFENSE ARTICLES FOR SALE OR TRANSFER TO ELIGIBLE FOREIGN COUNTRIES AND ENTITIES

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