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

Subtitle B — Provisions Relating to Major Defense Acquisition Programs

NDAA Section

House Conference Report 110-477

SEC. 816. REVIEW OF SYSTEMIC DEFICIENCIES ON MAJOR DEFENSE ACQUISITION PROGRAMS.

(a) Annual Review- The Under Secretary of Defense for Acquisition, Technology, and Logistics shall conduct an annual review of systemic deficiencies in the major defense acquisition programs of the Department of Defense for each fiscal year in which three or more major defense acquisition programs--

(1) experience a critical cost growth threshold breach;

(2) have a section 2366a certification withdrawn; or

(3) have a Milestone A approval or Key Decision Point A approval rescinded, by the milestone decision authority under subsection (b) of section 2366b of title 10, United States Code, as added by section 943 of this Act.

(b) Content of Review- The review conducted under subsection (a) shall--

(1) identify common factors, including any systemic deficiencies in the budget, requirements, and acquisition policies and practices, that may have contributed to problems with major defense acquisition programs covered by the criteria in subsection (a);

(2) assess the adequacy of corrective actions taken or to be taken to address cost growth or other performance deficiencies in programs covered by the criteria in subsection (a); and

(3) make recommendations for any changes in budget, requirements, and acquisition policies and practices that may be appropriate to avoid similar problems with major defense acquisition programs in the future.

(c) Definitions- In this section:

(1) CRITICAL COST GROWTH THRESHOLD BREACH- The term `critical cost growth threshold breach' means a determination under section 2433(d) of title 10, United States Code, by the Secretary of a military department with respect to a major defense acquisition program that the program acquisition unit cost has increased by a percentage equal to or greater than the critical cost growth threshold or that the procurement unit cost has increased by a percentage equal to or greater than the critical cost growth threshold.

(2) SECTION 2366a CERTIFICATION- The term `section 2366a certification' means a certification with respect to a major defense acquisition program under section 2366a(a) of title 10, United States Code, by the milestone decision authority.

(d) Report- Not later than July 15, 2008, and not later than August 15 of each year from 2009 through 2012, the Secretary of Defense shall submit to the congressional defense committees a report on the results of the annual review conducted (if any) for the preceding fiscal year under subsection (a).

(e) Sunset- The requirement to conduct an annual review under subsection (a) shall terminate on September 30, 2012.

The House bill contained a provision (sec. 847) that would require each component of the Department of Defense that has multiple programs experiencing excessive cost growth in any fiscal year to identify and report on systemic deficiencies in its acquisition policies and practices that may have contributed to such cost growth.

The Senate amendment contained no similar provision.

The Senate recedes with an amendment that would require the Under Secretary of Defense for Acquisition, Technology, and Logistics to conduct an annual review of systemic deficiencies in major defense acquisition programs that have led to critical cost threshold breaches or required recertification of programs by the Joint Requirements Oversight Council.

House Armed Services Committee Report 110-146

SECTION 847--MULTIPLE COST THRESHOLD BREACHES

This section would require that each military department, each defense agency, each defense field activity, and each combatant command managing a major defense acquisition program track the number of such programs experiencing excessive cost growth. For purposes of this section, excessive cost growth would be increases in cost in excess of the thresholds established in section 2433 of title 10, United States Code, and section 945 of this Act. This section would also require that any military department, defense agency, defense field activity, or combatant command managing more than two major defense acquisition programs that are experiencing excessive cost growth provide a report to the Secretary of Defense within 90 days of the end of the fiscal year, outlining any systemic deficiencies in its acquisition policies or practices and outlining possible corrections. This section would further require that the Secretary of Defense provide a report to the congressional defense committees containing a description of the excessive cost growth reported under this section and an assessment of the corrective actions proposed within 120 days of the end of the fiscal year.