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TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED MATTERS

Subtitle C--Amendments to General Contracting Authorities, Procedures, and Limitations

P. L. 111-

Joint Explanatory Statement of the Committees on Armed Services of the U. S. Senate and House of Representatives on H. R. 6523

From H. R. 6523

SEC. 827. PERMANENT AUTHORITY FOR DEFENSE ACQUISITION CHALLENGE PROGRAM; PILOT EXPANSION OF PROGRAM.

(a) Permanent Authority- Section 2359b of title 10, United States Code, is amended--

(1) by striking subsections (j) and (k); and

(2) by redesignating subsection (l) as subsection (j).

(b) Pilot Program- Section 2359b of title 10, United States Code, as amended by subsection (a), is further amended by adding at the end the following new subsection (k):

`(k) Pilot Program for Programs Other Than Major Defense Acquisition Programs-

`(1) IN GENERAL- The Under Secretary of Defense for Acquisition, Technology, and Logistics shall carry out a pilot program to expand the use of the authority provided in this section to provide opportunities for the introduction of innovative and cost-saving approaches to programs other than major defense acquisition programs through the submission, review, and implementation, where appropriate, of qualifying proposals.

`(2) QUALIFYING PROPOSALS- For purposes of this subsection, a qualifying proposal is an offer to supply a nondevelopmental item that--

`(A) is evaluated as achieving a level of performance that is at least equal to the level of performance of an item being procured under a covered acquisition program and as providing savings in excess of 15 percent after considering all costs to the Government of implementing such proposal; or

`(B) is evaluated as achieving a level of performance that is significantly better than the level of performance of an item being procured under a covered acquisition program without any increase in cost to the Government.

`(3) REVIEW PROCEDURES- The Under Secretary shall adopt modifications as may be needed to the procedures applicable to the Challenge Program to provide for Department of Defense review of, and action on, qualifying proposals. Such procedures shall include, at a minimum, the issuance of a broad agency announcement inviting interested parties to submit qualifying proposals in areas of interest to the Department.

`(4) DEFINITIONS- In this subsection:

`(A) NONDEVELOPMENTAL ITEM- The term `nondevelopmental item' has the meaning given that term in section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403).

`(B) COVERED ACQUISITION PROGRAM- The term `covered acquisition program' means any acquisition program of the Department of Defense other than a major defense acquisition program, but does not include any contract awarded under an exception to competitive acquisition authorized by the Small Business Act (15 U.S.C. 631 et seq.)

`(C) LEVEL OF PERFORMANCE- The term `level of performance', with respect to a nondevelopmental item, means the extent to which the item demonstrates required item functional characteristics.

`(5) SUNSET- The authority to carry out the pilot program under this subsection shall terminate on the date that is five years after the date of the enactment of this Act.'.

From H.R. 5136:  National Defense Authorization Act for Fiscal Year 2011

SEC. 831. EXTENSION OF AUTHORITY FOR DEFENSE ACQUISITION CHALLENGE PROGRAM.

Section 2359b(k) of title 10, United States Code, is amended by striking `2012' and inserting `2017'.

SEC. 408. ACQUISITION SAVINGS PROGRAM.

(a) Program Required-

(1) IN GENERAL- The Secretary of Defense, acting through the Under Secretary of Defense for Acquisition, Technology, and Logistics, shall carry out a program to provide opportunities to provide cost-savings on nondevelopmental items.

(2) SAVINGS- The program, to be known as the Acquisition Savings Program, shall provide any person or activity within or outside the Department of Defense with the opportunity to offer a proposal to provide savings in excess of 15 percent, to be known as an acquisition savings proposal, for covered contracts.

(3) SUNSET- The program shall cease to be required on September 30, 2013.

(b) Qualifying Acquisition Savings Proposals- A proposal shall qualify as an acquisition savings proposal for purposes of this section if it offers to supply a nondevelopmental item that is identical to, or equivalent to (under a performance specification or relevant commercial standard), an item being procured under a covered contract.

(c) Review by Contracting Officer- Each acquisition savings proposal shall be reviewed by the contracting officer for the covered contract concerned to determine if such proposal qualifies under this section and to calculate the savings provided by such proposal.

(d) Actions Upon Favorable Review- If the contracting officer for a covered contract determines after review of an acquisition savings proposal that the proposal would provide an identical or equivalent nondevelopmental item at a savings in excess of 15 percent, and that a contract award to the offeror of the proposal would not result in the violation of a minimum purchase agreement or otherwise cause a breach of contract for the covered contract, the contracting officer may make an award under the covered contract to the offeror of the acquisition savings proposal or otherwise award a contract for the nondevelopmental item concerned to such offeror.

(e) Actions Upon Unfavorable Review- If a contracting officer determines after review of an acquisition savings proposal that the proposal would not satisfy the requirements of this section, the contracting officer shall debrief the person or activity offering such proposal within 30 days after completion of the review.

(f) Report- Not later than March 1, 2013, the Secretary of Defense shall submit to the Committees on Armed Services of the Senate and House of Representatives a report regarding the program, including the number of acquisition savings proposals submitted, the number favorably reviewed, the cumulative savings, and any further recommendations for the program.

(g) Definitions- In this section:

(1) NONDEVELOPMENTAL ITEM- The term `nondevelopmental item' has the meaning provided for such term in section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403).

(2) COVERED CONTRACT- The term `covered contract'--

(A) means an indefinite delivery indefinite quantity contract for property as defined in section 2304d(2) of title 10, United States Code; and

(B) does not include any contract awarded under an exception to competitive acquisition authorized by the Small Business Act (15 U.S.C. 631 et seq.)

(3) PERFORMANCE SPECIFICATION- The term `performance specification' means a specification of required item functional characteristics.

(4) COMMERCIAL STANDARD- The term `commercial standard' means a standard used in industry promulgated by an accredited standards organizations that is not a Federal entity.

From S. 3454, National Defense Authorization Act for Fiscal Year 2011

SEC. 813. PERMANENT AUTHORITY FOR DEFENSE ACQUISITION CHALLENGE PROGRAM.

(a) Permanent Authority- Section 2359b of title 10, United States Code, is amended by striking subsection (k).

(b) Repeal of Annual Report Requirement- Such section is further amended by striking subsection (j).

(c) Conforming Amendment- Such section is further amended by redesignating subsection (l) as subsection (j).

The House bill contained a provision (sec. 831) that would amend section 2359b of title 10, United States Code, to extend the Defense Acquisition Challenge Program for 5 years, to 2017.

The House bill contained a second provision (sec. 408 of division D) that would establish a new program, similar to the Challenge Program, focused on non-developmental items.

The Senate committee-reported bill contained a provision (sec. 813) that would eliminate the sunset date for the Challenge Program, making the program permanent.

The agreement includes a provision that would make the Challenge Program permanent and amend the program to ensure that it covers the non-developmental items addressed in section 408 of division D of the House bill.

From H. Rpt. 111-491, accompanying H. R. 5136, the NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2011

SECTION 831--EXTENSION OF AUTHORITY FOR DEFENSE ACQUISITION CHALLENGE PROGRAM

This section would extend the expiration date of the Defense Acquisition Challenge Program from 2012 to 2017.

Section 408 of division D  (Wifcon.com Note)

This section was added as part of H. R. 5013 during consideration of H. R. 5136.  It was added at the end of H. R. 5136 after H. Rpt. 111-491.

From S. Rpt. 111-201, to accompany S. 3454, NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2011

Permanent authority for Defense Acquisition Challenge Program (sec. 813)

The committee recommends a provision that would provide permanent authority for the Defense Acquisition Challenge Program, as requested by the Department of Defense (DOD). The Challenge program is designed to provide opportunities for the introduction of innovative and cost-saving technology in DOD acquisition programs.