(1) Designating certain SBIR and STTR programs as Entrepreneurial Innovation Projects

Chapter 303 of title 10, United States Code, is amended by inserting after section 4062 the following new section:

4063. Entrepreneurial Innovation Project designations

(a) In general

During the first fiscal year beginning after the date of the enactment of this section, and during each subsequent fiscal year, each Secretary concerned, in consultation with each chief of an armed force under the jurisdiction of the Secretary concerned, shall designate not less than five eligible programs as Entrepreneurial Innovation Projects.

(b) Application

An eligible program seeking designation as an Entrepreneurial Innovation Project under this section shall submit to the Secretary concerned an application at such time, in such manner, and containing such information as the Secretary concerned determines appropriate.

(c) Designation criteria

In making designations under subsection (a), the Secretary concerned shall consider—

(1)

the potential of the eligible program to—

(A)

advance the national security capabilities of the United States;

(B)

provide new technologies or processes, or new applications of existing technologies, that will enable new alternatives to existing programs; and

(C)

provide future cost savings;

(2)

whether an advisory panel has recommended the eligible program for designation; and

(3)

such other criteria that the Secretary concerned determines to be appropriate.

(d) Designation benefits

(1) Future years defense program inclusion

With respect to each designated program, the Secretary of Defense shall include in the next future-years defense program the estimated expenditures of such designated program. In the preceding sentence, the term next future-years defense program means the future-years defense program submitted to Congress under section 221 of this title after the date on which such designated program is designated under subsection (a).

(2) Programming proposal

Each designated program shall be included by the Secretary concerned under a separate heading in any programming proposals submitted to the Secretary of Defense.

(3) PPBE component

Each designated program shall be considered by the Secretary concerned as an integral part of the planning, programming, budgeting, and execution process of the Department of Defense.

(e) Entrepreneurial Innovation Advisory Panels

(1) Establishment

For each military department, the Secretary concerned shall establish an advisory panel that, starting in the first fiscal year beginning after the date of the enactment of this section, and in each subsequent fiscal year, shall identify and recommend to the Secretary concerned for designation under subsection (a) eligible programs based on the criteria described in subsection (c)(1).

(2) Membership

(A) Composition

(i) In general

Each advisory panel shall be composed of four members appointed by the Secretary concerned and one member appointed by the chief of the relevant armed force under the jurisdiction of the Secretary concerned.

(ii) Secretary concerned appointments

The Secretary concerned shall appoint members to the advisory panel as follows:

(I)

Three members who—

(aa)

have experience with private sector entrepreneurial innovation, including development and implementation of such innovations into well established markets; and

(bb)

are not employed by the Federal Government.

(II)

One member who is in the Senior Executive Service in the acquisition workforce (as defined in section 1705 of this title) of the relevant military department.

(iii) Service chief appointment

The chief of an armed force under the jurisdiction of the Secretary concerned shall appoint to the advisory panel one member who is a member of such armed forces.

(B) Terms

(i) Private sector members

Members described in subparagraph (A)(ii)(I) shall serve for a term of three years, except that of the members first appointed—

(I)

one shall serve a term of one year;

(II)

one shall serve a term of two years; and

(III)

one shall serve a term of three years.

(ii) Federal Government employees

Members described in clause (ii)(II) or (iii) of subparagraph (A) shall serve for a term of two years, except that the first member appointed under subparagraph (A)(iii) shall serve for a term of one year.

(C) Chair

The chair for each advisory panel shall be as follows:

(i)

For the first year of operation of each such advisory panel, and every other year thereafter, the member appointed under subparagraph (A)(iii).

(ii)

For the second year of operation of each such advisory panel, and every other year thereafter, the member appointed under subparagraph (A)(ii)(II).

(D) Vacancies

A vacancy in an advisory panel shall be filled in the same manner as the original appointment.

(E) Conflict of interest

Members and staff of each advisory panel shall disclose to the relevant Secretary concerned, and such Secretary concerned shall mitigate to the extent practicable, any professional or organizational conflict of interest of such members or staff arising from service on the advisory panel.

(F) Compensation

(i) Private sector member compensation

Except as provided in clause (ii), members of an advisory panel, and the support staff of such members, shall be compensated at a rate determined reasonable by the Secretary concerned and shall be reimbursed in accordance with section 5703 of title 5 for reasonable travel costs and expenses incurred in performing duties as members of an advisory panel.

(ii) Prohibition on compensation of Federal employees

Members of an advisory panel who are full-time officers or employees of the United States or Members of Congress may not receive additional pay, allowances, or benefits by reason of their service on an advisory panel.

(3) Selection process

(A) Initial selection

Each advisory panel shall select not less than ten eligible programs that have submitted an application under subsection (b).

(B) Program plans

(i) In general

Each eligible program selected under subparagraph (A) may submit to the advisory panel that selected such eligible program a program plan containing the five-year goals, execution plans, schedules, and funding needs of such eligible program.

(ii) Support

Each Secretary concerned shall, to the greatest extent practicable, provide eligible programs selected under subparagraph (A) with access to information to support the development of the program plans described in clause (i).

(C) Final selection

Each advisory panel shall recommend to the Secretary concerned for designation under subsection (a) not less than five eligible programs that submitted a program plan under subparagraph (B) to such advisory panel. If there are less than five such eligible programs, such advisory panel may recommend to the Secretary concerned for designation under subsection (a) less than five such eligible programs.

(4) Administrative and technical support

The Secretary concerned shall provide the relevant advisory panel with such administrative support, staff, and technical assistance as the Secretary concerned determines necessary for such advisory panel to carry out it duties.

(5) Funding

The Secretary of Defense may use amounts available from the Department of Defense Acquisition Workforce Development Account established under section 1705 of this title to support the activities of advisory panels.

(6) Inapplicability of FACA

Chapter 10 of title 5 shall not apply to the advisory panels established under this subsection.

(f) Revocation of designation

If the Secretary concerned determines that a designated program cannot reasonably meet the objectives of such designated program in the relevant programming proposal referred to in subsection (d)(2) or such objectives are irrelevant, such Secretary concerned may revoke the designation.

(g) Report to congress

The Secretary of Defense shall submit to Congress an annual report describing each designated program and the progress each designated program has made toward achieving the objectives of the designated program.

(h) Definitions

In this section:

(1) Advisory panel

The term advisory panel means an advisory panel established under subsection (e)(1).

(2) Designated program

The term designated program means an eligible program that has been designated as an Entrepreneurial Innovation Project under this section.

(3) Eligible program

The term eligible program means work performed pursuant to a Phase III agreement (as such term is defined in section 9(r)(2) of the Small Business Act (15 U.S.C. 638(r)(2))).

(2) Clerical amendment

The table of sections at the beginning of chapter 303 of title 10, United States Code, is amended by striking the item relating to section 4063 and inserting after the item relating to section 4062 the following new item: