I
114th CONGRESS
1st Session
H. R. 1597
IN THE HOUSE OF REPRESENTATIVES
March 25, 2015
Mr. Thornberry (for himself and Mr. Smith of Washington) introduced the following bill; which was referred to the Committee on Armed Services, and in addition to the Committees on Small Business, Science, Space, and Technology, and Oversight and Government Reform, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned
A BILL
To reform the acquisition system of the Department of Defense, and for other purposes.
Short title
This Act may be cited as the Agile Acquisition to Retain Technological Edge Act
.
Table of contents
The table of contents for this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Sense of Congress on the desired tenets of the defense acquisition system.
Title I—Workforce Development and Related Matters
Sec. 101. Amendments to Department of Defense Acquisition Workforce Development Fund.
Sec. 102. Dual-track military professionals in operational and acquisition specialities.
Sec. 103. Provision of joint duty assignment credit for acquisition duty.
Sec. 104. Requirement for acquisition skills assessment biennial strategic workforce plan.
Sec. 105. Mandatory requirement for training related to the conduct of market research.
Sec. 106. Independent study of implementation of defense acquisition workforce improvement efforts.
Title II—Weapon Systems Acquisition and Related Matters
Sec. 201. Sense of Congress on the desired characteristics for the weapon systems acquisition system.
Sec. 202. Revision to duties of the Deputy Assistant Secretary of Defense for Developmental Test and Evaluation and the Deputy Assistant Secretary of Defense for Systems Engineering.
Sec. 203. Acquisition strategy required for each major defense acquisition program and major system.
Sec. 204. Revision to requirements relating to risk management in development of major defense acquisition programs and major systems.
Sec. 205. Modification to requirements relating to determination of contract type for major defense acquisition programs and major systems.
Sec. 206. Required determination before Milestone A approval or initiation of major defense acquisition programs.
Sec. 207. Required certification and determination before Milestone B approval of major defense acquisition programs.
Title III—Services Contracting and Related Matters
Sec. 301. Examination and guidance relating to oversight and approval of services contracts.
Title IV—Information Technology Acquisitions and Related Matters
Sec. 401. Streamlining of requirements relating to defense business systems.
Title V—Industrial Base Matters
Sec. 501. Codification and amendment of Mentor-Protege Program.
Sec. 502. Amendments to data quality improvement plan.
Sec. 503. Notice of contract consolidation for acquisition strategies.
Sec. 504. Clarification of requirements related to small business contracts for services.
Sec. 505. Review of Government access to intellectual property rights of private sector firms.
Sec. 506. Modifications to the Small Business Innovative Research Program and the Small Business Technology Transfer Program.
Sec. 507. Extension of defense research and development rapid innovation program.
Title VI—Repeal or Revision of Reporting Requirements
Sec. 601. Repeal of certain reporting requirements.
Title VII—Planning, Budgeting, Contracting, Oversight, and Other Related Matters
Sec. 701. Additional responsibility for Director of Operational Test and Evaluation.
Sec. 702. Report on linking and streamlining requirements, acquisition, and budget processes within Armed Forces.
Sec. 703. Required review of acquisition-related functions of the Chiefs of Staff of the Armed Forces.
Sec. 704. FAR Council membership for Administrator of Small Business Administration.
Sec. 705. Independent study of matters related to bid protests.
Sec. 706. Procurement of commercial items.
Sec. 707. Amendment relating to multiyear contract authority for acquisition of property.
Sec. 708. Use of recent prices paid by the Government in the determination of price reasonableness.
Sec. 709. Codification of other transaction authority for certain prototype projects.
Sec. 710. Amendments to certain acquisition thresholds.
Sec. 711. Revision of method of rounding when making inflation adjustment of acquisition-related dollar thresholds.
Sec. 712. Repeal of requirement for stand-alone manpower estimates for major defense acquisition programs.
Sense of Congress on the desired tenets of the defense acquisition system
Findings
Congress finds the following:
The Committee on Armed Services of the House of Representatives held a series of hearings in 2013, 2014, and 2015 gathering testimony from key acquisition leaders and experts. It is clear that the acquisition reform efforts of the last 50 years continue to founder because they fail to address the motivational and environmental factors in which they must be implemented. The acquisition system, though frustrating to all, is in one sense in equilibrium. The acquisition system provides enough benefits to proponents and opponents to continue, with only minor changes, despite its shortcomings.
The Department of Defense still has too many defense acquisitions and services chasing too few dollars. Consequently, there remains a vast difference between the budgeting plans of the Department and the reality of the cost of its systems or the services it acquires. To keep programs alive, the Department develops and Congress accepts fragile acquisition strategies that downplay technical issues and assume only successful outcomes from high-risk efforts. As a result, the Department often ends up with too few weapons, with performance that falls short, that are difficult and costly to maintain, delivered late at too high a cost. We have limited insight into the services acquired or what services need to be acquired in the future. Furthermore, the conventional acquisition process is not agile enough for today’s demands. Finally, the Department of Defense continues to struggle with financial management and auditability, affecting its ability to control costs, ensure basic accountability, anticipate future costs and claims on the budget, and measure performance.
Too often today, all stakeholders in the Department of Defense, Congress, and industry, accept that—
for the acquisition process, success is defined as maximizing technical performance or protecting organizational interests, without regard to funding disruptions and delivery delays of needed capability or services to the warfighter; and
the acquisition process is—
reactive, meaning issues are addressed late and at great cost only after problems are realized;
plodding, meaning the bureaucratic processes are sclerotic and cumbersome;
opaque, meaning that limiting information is necessary to protect programs; and
traditional, meaning that customary approaches and suppliers are preferred over perceived risk of new or unique concepts and vendors.
Today, the United States is at a cross-roads, and if changes to the acquisition system are not made soon, the trend of fewer and more costly systems and services that fall short of the needs of the Armed Forces will continue. Congress, the Department of Defense, contractors, and the American people all have a stake in making positive changes. Each plays a role in contributing to the current system. Each gains benefits from that system, but each is frustrated by it as well.
The acquisition improvement effort of the Committee on Armed Services of the House of Representatives proposes a different approach from previous efforts by seeking to improve the environment (i.e., statutes, regulations, processes, and culture) driving acquisition decisions in the Department of Defense, industry, and Congress. The Committee has solicited input from industry and the Department of Defense, as well as others in Congress, and will continue to do so. The Committee recognizes that there are no silver bullets
that can immediately fix the current acquisition system in a holistic and long-standing manner. Therefore, the reform effort will be an ongoing and iterative process that will result in legislation not only this year, but will be embedded in the Committee’s annual and regular work.
Sense of congress on the tenets of an improved acquisition system
It is the sense of Congress that all stakeholders in the acquisition system—the Department of Defense, Congress, and industry—should be governed by the following tenets:
Success
Success in the acquisition system means the timely delivering of affordable and effective military equipment and services.
Proactive
The acquisition system should be proactive, meaning—
the system should recognize that development and acquisition problems can occur; and
officials at all levels should be empowered to solve problems and reduce risks by surfacing issues early and honestly and taking action to resolve them.
Agile
The acquisition system should be agile, meaning that needed program adjustments should be proposed and adjudicated quickly.
Transparent
The acquisition system should be transparent, meaning that—
all decisionmakers should be given useful, relevant, credible, and reliable information when making commitments;
Government and industry communication should be clear and open; and
the Department of Defense should produce auditable financial management statements.
Innovative
The acquisition system should be innovative, meaning that barriers should be removed that preclude companies from undertaking defense business or officials from proposing new approaches.
Workforce Development and Related Matters
Amendments to Department of Defense Acquisition Workforce Development Fund
Permanent extension of fund
Section 1705(d)(2) of title 10, United States Code, is amended—
in subparagraph (C), by striking of an amount as follows:
and all that follows through the end, and inserting of an amount of not less than $500,000,000.
; and
in subparagraph (D), by striking an amount that is less than
and all that follows through the end, and inserting an amount that is less than $400,000,000
.
Permanent extension of expedited hiring authority
Section 1705(g) of such title is amended—
by striking paragraph (2);
by striking Authority.—
and all that follows through For purposes of
in paragraph (1) and inserting Authority.—For purposes of
;
by striking (A)
and inserting (1)
; and
by striking (B)
and inserting (2)
.
Clarification of acquisition workforce covered
Section 1705(g) of such title, as amended by subsection (c), is further amended by striking acquisition workforce positions
and inserting of positions in the acquisition workforce, as defined in subsection (h),
.
Dual-track military professionals in operational and acquisition specialities
Requirement for service chief involvement
Section 1722a(a) of title 10, United States Code, is amended by inserting after military department)
the following: , in collaboration with the Chief of Staff of the Army, the Chief of Naval Operations, the Chief of Staff of the Air Force, and the Commandant of the Marine Corps (with respect to the Army, Navy, Air Force, and Marine Corps, respectively),
.
Dual-Track Career Path
Section 1722a(b) of such title is amended—
by redesignating paragraphs (2) and (3) as paragraphs (3) and (4), respectively;
in paragraph (1), by inserting single-track
before career path
; and
by inserting after paragraph (1) the following new paragraph (2):
A dual-track career path that attracts the highest quality officers and enlisted personnel and allows them to gain experience in and receive credit for a primary career in combat arms and a functional secondary career in the acquisition field in order to more closely align the military operational, requirements, and acquisition workforces of each armed force.
.
Provision of joint duty assignment credit for acquisition duty
Section 668(a)(1) of title 10, United States Code, is amended—
by striking or
at the end of subparagraph (D);
by striking the period at the end of subparagraph (E) and inserting ; or
; and
by adding at the end the following new subparagraph:
acquisition matters addressed by military personnel and covered under chapter 87 of this title.
.
Requirement for acquisition skills assessment biennial strategic workforce plan
Requirement
Section 115b(b)(1) of title 10, United States Code, is amended—
by redesignating subparagraph (D) as subparagraph (E);
in subparagraph (C), by striking and
at the end; and
by inserting after subparagraph (C) the following:
new or expanded critical skills and competencies needed by the existing civilian employee workforce of the Department to address new acquisition process requirements established by law or policy during the four years preceding the year of submission of the plan; and
.
Conforming amendments
Section 115b of such title is further amended—
in subparagraph (E) of subsection (b)(1), as redesignated by subsection (a)(1), by striking (C)
and inserting (D)
;
in paragraph (2) of subsection (b), in the matter preceding subparagraph (A), by striking (1)(D)
and inserting (1)(E)
; and
in paragraph (2)(A) of each of subsections (c), (d), and (e), by striking through (D)
and inserting through (E)
.
Mandatory requirement for training related to the conduct of market research
Mandatory market research training
Section 2377 of title 10, United States Code, is amended by adding at the end the following new subsection:
Market research training required
The Secretary of Defense shall provide mandatory training for members of the armed forces and employees of the Department of Defense responsible for the conduct of market research required under subsection (c). Such mandatory training shall, at a minimum—
provide comprehensive information on the subject of market research and the function of market research in the acquisition of commercial items;
teach best practices for conducting and documenting market research; and
provide methodologies for establishing standard processes and reports for collecting and sharing market research across the Department.
.
Incorporation into management certification training mandate
The Chairman of the Joint Chiefs of Staff shall ensure that the requirements of section 2377(d) of title 10, United States Code, as added by subsection (a), are incorporated into the requirements management certification training mandate of the Joint Capabilities Integration Development System.
Independent study of implementation of defense acquisition workforce improvement efforts
Requirement for study
Not later than 30 days after the date of the enactment of this Act, the Secretary of Defense shall enter into a contract with an independent research entity described in subsection (b) to carry out a comprehensive study of the strategic planning of the Department of Defense related to the defense acquisition workforce. The study shall provide a comprehensive examination of the Department’s efforts to recruit, develop, and retain the acquisition workforce with a specific review of the following:
The implementation of the Defense Acquisition Workforce Improvement Act (including chapter 87 of title 10, United States Code).
The application of the Department of Defense Acquisition Workforce Development Fund (as established under section 1705 of title 10, United States Code).
The effectiveness of professional military education programs, including fellowships and exchanges with industry.
Independent research entity
The entity described in this subsection is an independent research entity that is a not-for-profit entity or a federally funded research and development center with appropriate expertise and analytical capability.
Reports
To Secretary
Not later than one year after the date of the enactment of this Act, the independent research entity shall provide to the Secretary a report containing—
the results of the study required by subsection (a); and
such recommendations to improve the acquisition workforce as the independent research entity considers to be appropriate.
To Congress
Not later than 30 days after receipt of the report under paragraph (1), the Secretary of Defense shall submit such report, together with any additional views or recommendations of the Secretary, to the congressional defense committees.
Weapon Systems Acquisition and Related Matters
Sense of Congress on the desired characteristics for the weapon systems acquisition system
Findings
Congress makes the following findings:
Current situation
Despite significant and repeated attempts at acquisition reform, the Department of Defense still experiences case after case of expensive weapon system acquisition failures. The Department of Defense has a track record of too many cancellations, schedule slippages, cost over-runs, and failures to deliver timely solutions to the requirements of the Armed Forces. This situation is unacceptable. For example, according to the Final Report of the 2010 Army Acquisition Review, between 1996 and 2010, the Army expended approximately $1 billion to $3 billion annually on two dozen programs that were eventually cancelled. No military service and no type of weapon acquisition has been immune.
Problems in all phases of acquisitions
Despite detailed weapon acquisition processes and procedures, there is only limited discipline in starting programs. Many programs begin without a solid foundation. They have too many requirements deemed critical
, which are driven by too many organizations and individuals. Approved requirements are often set with only a limited understanding of the technical feasibility of achieving them. The resulting compromises of good program management and engineering judgment that allow the programs to proceed are the spackle
of the acquisition system that covers up the risks and enables the system to operate.
As these weapon systems proceed into engineering and manufacturing development, they often encounter development problems leading to cost growth, schedule delay, and performance reductions. Industry and Government officials frequently respond by taking additional development risks to resolve basic performance issues by reducing the time to analyze and assess development results, overlapping key development efforts, and reducing testing. The Department of Defense and Congress disrupt the planned funding of stable programs to find resources for troubled programs or to fund across-the-board spending cuts. Funding instability is the inevitable price that programs pay for survival because funding disruptions actually keep more programs alive.
Finally, these weapons are often rushed into production only to encounter production problems, and are fielded with many unknowns or deficiencies leading to significantly reduced quantities and force structure reductions. The warfighter faces the challenge of operating weapons with poor reliability, high maintenance demands, reduced performance, and many capability shortfalls.
Sense of Congress
In general
It is the sense of Congress that, in accordance with the tenets described in section 3, to improve weapon system acquisitions, the Department of Defense, Congress, and industry should develop an acquisition system characterized by highly disciplined program initiation coupled with agile program execution and balanced oversight, as described in paragraphs (2), (3), and (4).
Highly disciplined program initiation
An acquisition system characterized by highly disciplined program initiation means that programs do not begin engineering development until firm requirements are matched to a flexible acquisition strategy structured to develop militarily useful capability that can be delivered in a relevant period of time with available technologies, funding, and management capacity. Such a highly disciplined program initiation includes—
a workforce with smart requirements setters and expert buyers, with the knowledge, skills, and experience to successfully plan for and execute highly complex acquisitions;
requirements that are well-defined, technically feasible, and affordable;
acquisition strategies that are designed to minimize time to market of militarily useful capability, with the program concerned being structured so that—
lower-risk, technically mature capabilities are matched to delivering capability to the warfighter in the near term, while remaining requirements are aligned and resources are programmed to support integration into later increments to meet the requirements of the Armed Forces;
capabilities are approved for an increment only when their developmental risks have been appropriately reduced; and
increments are planned to complete engineering and manufacturing development in a reasonable period of time;
a science and technology development enterprise that is responsive to the acquisition process before engineering and manufacturing development begins, and sufficiently resourced to reduce risks and enable programs to make smart decisions without losing critical funds; and
redtape reduction in order to free up program and Department officials to focus on their mission of defining an executable program and understanding and addressing risks.
Agile program execution
An acquisition system characterized by agile program execution means a system in which acquisition speed and flexibility to make trade-offs are balanced with the need to achieve desired technical performance. Such agile program execution includes—
program managers and program officials who are expert buyers and negotiators who anticipate problems, negotiate solutions, and are empowered to manage;
a preference for fixed price development, with program initiation laying the foundation in which fixed price contracting is the appropriate contract type for product development;
program managers who avoid increasing program risk by resisting the addition of new requirements or the reduction of developmental activities;
empowering program managers and senior decisionmakers to make decisions easily in order to move forward with capabilities that mature quickly, cancel those that encounter greater difficulties than expected, and trade-off or reduce requirements to maintain cost and schedule;
enabling program managers to focus on overcoming execution challenges and delivering success rather than concentrating on compliance with reporting, certifications, and other redtape; and
senior decisionmakers who have knowledge of demonstrated performance as programs proceed through development, with robust developmental testing occurring before committing to production for operational use as a basis for decisionmaking.
Balanced Oversight
An acquisition system characterized by balanced oversight means that the focus is on ensuring discipline initiating programs and that appropriate adjustments are made during development, so that programs have the best chance to succeed. Such balanced oversight includes—
involvement by decisionmakers early to ensure that an understanding of trade-offs, risks, and needs are considered, resourced, and validated, and that agreement is reached between the executive and legislative branches;
acceptance by decisionmakers that complex weapon system developments are inherently risky and require expertise and flexibility to manage effectively;
conscious decisions by decisionmakers regarding where to accept risk, while ensuring that risk mitigation plans are resourced (with time, funding, alternatives, and competent government and contractor officials);
measuring and monitoring by decisionmakers of the right factors, such as technology maturation progress and systems engineering during risk reduction, development cost growth during engineering and manufacturing development, and reliability growth during system demonstration;
work by Congress and the Department of Defense, once a program has begun, to resolve issues by considering trade-offs among cost, schedule, and performance necessary to best support the warfighter; and
congressional understanding of risks and efforts to mitigate such risks even if they are through non-traditional means or other technological advances.
Revision to duties of the Deputy Assistant Secretary of Defense for Developmental Test and Evaluation and the Deputy Assistant Secretary of Defense for Systems Engineering
Section 139b of title 10, United States Code, is amended—
in subsection (a)(5)—
in subparagraph (B), by striking review and approve or disapprove
and inserting advise in writing the milestone decision authority regarding review and approval of
; and
in subparagraph (C), by inserting in order to advise relevant technical authorities for such programs on the incorporation of best practices for developmental test from across the Department
after programs
; and
in subsection (b)(5)—
in subparagraph (B), by striking review and approve
and inserting advise in writing the milestone decision authority regarding review and approval of
; and
in subparagraph (C), by inserting in order to advise relevant technical authorities for such programs on the incorporation of best practices for systems engineering from across the Department
after programs
.
Acquisition strategy required for each major defense acquisition program and major system
Consolidation of requirements relating to acquisition strategy
New title 10 section
Chapter 144 of title 10, United States Code, is amended by inserting after section 2431 the following new section:
Acquisition strategy
Acquisition strategy required
There shall be an acquisition strategy for each major defense acquisition program and each major system approved by a Milestone Decision Authority.
Responsible official
For each acquisition strategy required by subsection (a), the Under Secretary of Defense for Acquisition, Technology, and Logistics is responsible for issuing and maintaining the requirements for—
the content of the strategy; and
the review and approval process for the strategy.
Considerations
In issuing requirements for the content of an acquisition strategy for a major defense acquisition program or major system, the Under Secretary shall ensure that—
the strategy clearly describes the proposed business and technical management approach for the program or system, in sufficient detail to allow the Milestone Decision Authority to assess the viability of the proposed approach;
the strategy contains a clear explanation of how the strategy is designed to be implemented with available resources, such as time, funding, and management capacity; and
the strategy considers the items listed in paragraph (2).
Each strategy shall, at a minimum, consider the following:
An approach that delivers required capability in increments, each depending on available mature technology, and that recognizes up front the need for future capability improvements.
Acquisition approach, including industrial base considerations in accordance with section 2440 of this title.
Risk management, including such methods as competitive prototyping at the system, subsystem, or component level, in accordance with section 2431b of this title.
Business strategy, including measures to ensure competition at the system and subsystem level throughout the life-cycle of the program or system in accordance with section 2337 of this title.
Contracting strategy, including—
contract type and how the type selected relates to level of program risk in each acquisition phase;
how the plans for the program or system to reduce risk enable the use of fixed-price elements in subsequent contracts and the timing of the use of those fixed price elements;
market research; and
consideration of small business participation.
Intellectual property strategy in accordance with section 2320 of this title.
International involvement, including foreign military sales and cooperative opportunities, in accordance with section 2350a of this title.
Multi-year procurement in accordance with section 2306b of this title.
Integration of current intelligence assessments into the acquisition process.
Review
Subject to the authority, direction, and control of the Under Secretary of Defense for Acquisition, Technology, and Logistics, the Milestone Decision Authority shall review and approve, as appropriate, the acquisition strategy for a major defense acquisition program or major system at each of the following times:
Milestone A approval.
The decision to release the request for proposals for development of the program or system.
Milestone B approval.
Each subsequent milestone.
Review of any decision to enter into full-rate production.
When there has been—
a significant change to the cost of the program or system;
a critical change to the cost of the program or system;
a significant change to the schedule of the program or system; or
a significant change to the performance of the program or system.
Any other time considered relevant by the Milestone Decision Authority.
If the Milestone Decision Authority revises an acquisition strategy for a program or system, the Milestone Decision Authority shall provide notice of the revision to the congressional defense committees.
Definitions
In this section:
The term major defense acquisition program
has the meaning provided in section 2430 of this title.
The term major system
has the meaning provided in section 2302(5) of this title.
The term Milestone A approval
means a decision to enter into technology maturation and risk reduction pursuant to guidance prescribed by the Secretary of Defense for the management of Department of Defense acquisition programs.
The term Milestone B approval
has the meaning provided in section 2366(e)(7) of this title.
The term Milestone Decision Authority
, with respect to a major defense acquisition program or major system, means the official within the Department of Defense designated with the overall responsibility and authority for acquisition decisions for the program or system, including authority to approve entry of the program or system into the next phase of the acquisition process.
The term management capacity
, with respect to a major defense acquisition program or major system, means the capacity to manage the program or system through the use of highly qualified organizations and personnel with appropriate experience, knowledge, and skills.
The term significant change to the cost
, with respect to a major defense acquisition program or major system, means a significant cost growth threshold, as that term is defined in section 2433(a)(4) of this title.
The term critical change to the cost
, with respect to a major defense acquisition program or major system, means a critical cost growth threshold, as that term is defined in section 2433(a)(5) of this title.
The term significant change to the schedule
, with respect to a major defense acquisition program or major system, means any schedule delay greater than six months in a reported event.
Submission to congressional committees
Upon request by the chairman or ranking member of the Committee on Armed Services of the Senate or the House of Representatives, the Secretary of Defense shall submit to the committee the most recently approved acquisition strategy for a major defense acquisition program or major system. The strategy shall be submitted in unclassified form but may include a classified annex.
.
Clerical amendment
The table of sections at the beginning of such chapter is amended by inserting after the item relating to section 2431 the following new item:
2431a. Acquisition strategy.
.
Additional amendments
Section 2350a(e) of such title is amended—
in the subsection heading, by striking Document
;
in paragraph (1), by striking the Under Secretary of Defense for
and all that follows through of the Board
and inserting opportunities for such cooperative research and development shall be addressed in the acquisition strategy for the project
; and
in paragraph (2)—
in the matter preceding subparagraph (A)—
by striking document
and inserting discussion
; and
by striking include
and inserting consider
;
in subparagraph (A), by striking A statement indicating whether
and inserting Whether
;
in subparagraph (B)—
by striking by the Under Secretary of Defense for Acquisition, Technology, and Logistics
; and
by striking of the United States under consideration by the Department of Defense
; and
in subparagraph (D), by striking The recommendation of the Under Secretary
and inserting A recommendation to the Milestone Decision Authority
.
Section 803 of the Bob Stump National Defense Authorization Act for Fiscal Year 2003 (Public Law 107–314; 10 U.S.C. 2430 note) is repealed.
Revision to requirements relating to risk management in development of major defense acquisition programs and major systems
Risk management and mitigation requirements
In general
Chapter 144 of title 10, United States Code, is amended by inserting after section 2431a (as added by section 203) the following new section:
Risk management and mitigation in major defense acquisition programs and major systems
Requirement
There shall be a risk management and mitigation strategy for each major defense acquisition program or major system.
The Secretary of Defense shall ensure that the initial acquisition strategy (required under section 2431a of this title) approved by the Milestone Decision Authority and any subsequent revisions include the following:
A comprehensive strategy for managing and mitigating risk (including technical, cost, and schedule risk) during each of the following periods:
The period preceding engineering manufacturing development, or its equivalent.
The period preceding initial production.
The period preceding full-rate production.
An identification of the major sources of risk in each of the periods listed in subparagraph (A).
In the case of a program or system with separate increments of capabilities that require Milestone Decision Authority approval to begin or proceed, paragraphs (1) and (2) shall apply to each increment.
Strategy To Manage and Mitigate Risks
The comprehensive strategy to manage and mitigate risk included in the acquisition strategy for purposes of subsection (a)(2)(A) shall identify each individual risk and the risk management and mitigation activities to address each risk. For the mitigation activities identified, the strategy shall note whether they require cost and schedule margins and need to be included in funding requests.
The comprehensive strategy shall include the role and extent of the following:
Prototyping (including prototyping at the system, subsystem, or component level and competitive prototyping, where appropriate) and, if prototyping at either the system, subsystem, or component level is not used, an explanation of why it is not appropriate.
Modeling and simulation, the areas that modeling and simulation will assess, and identification of the need for development of any new modeling and simulation tools in order to support the comprehensive strategy.
Technology demonstrations and decision points for disciplined transition of planned technologies into programs or the selection of alternative technologies.
Multiple design approaches.
Alternative designs, including any designs that meet requirements but do so with reduced performance.
Phasing of program activities or related technology development efforts in order to address high risk areas as early as feasible.
Definitions
In this section, the terms major defense acquisition program
and major system
have the meanings provided in section 2431a of this title.
.
Clerical amendment
The table of sections at the beginning of such chapter is amended by inserting after the item relating to section 2431a, as so added, the following new item:
2431b. Risk management and mitigation in major defense acquisition programs and major systems.
.
Repeal of superseded provision
Section 203 of the Weapon Systems Acquisition Reform Act of 2009 (10 U.S.C. 2430 note) is repealed.
Modification to requirements relating to determination of contract type for major defense acquisition programs and major systems
Determination of contract type
Section 2306 of title 10, United States Code, is amended by adding at the end the following new subsection:
Required elements of guidance relating to contract type
The Secretary of Defense shall ensure that the guidance of the Department of Defense relating to major defense acquisition programs, major systems, and major automated information systems includes a requirement that the acquisition strategy required under section 2431a of this title for such a program or system includes—
a separate identification of the contract type for each acquisition phase of the program or system; and
a justification of the contract type identified.
The contract type identified in accordance with paragraph (1)(A) may be—
a fixed-price type contract (including a fixed-price incentive contract); or
a cost-type contract (including a cost-plus-incentive-fee contract).
The guidance referred to in paragraph (1) shall require that the justification for the contract type selected explain—
how the level of program risk in each acquisition phase relates to the contract type selected;
how the use of incentives (especially cost incentives) in the contract, if any, supports the program or system objectives during each acquisition phase; and
how the plans for the program or system to reduce risk enable the use of fixed-price elements in subsequent contracts.
The guidance shall also specify that the use of contracts with target costs, target profits or fees, and profit or fee adjustment formulas can be an appropriate contract type.
.
Repeal
Section 818 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109–364; 10 U.S.C. 2306 note) is amended by striking subsections (b), (c), (d), and (e).
Required determination before Milestone A approval or initiation of major defense acquisition programs
Determination rather than certification required
Subsection (a) of section 2366a of title 10, United States Code, is amended—
in the subsection heading, by striking Certification
and inserting Written determination required
; and
in the matter preceding paragraph (1), by striking certifies
and inserting determines, in writing,
.
Submission of written determination to congress
Subsection (b) of such section is amended to read as follows:
Submission to congress
At the request of any of the congressional defense committees, the Secretary of Defense shall submit to the committee an explanation of the basis for a determination made under subsection (a) with respect to a major defense acquisition program, together with a copy of the written determination. The explanation shall be submitted in unclassified form, but may include a classified annex.
.
Repeal of unused definitions
Subsection (c) of such section is amended—
by striking paragraphs (2) and (4); and
by redesignating paragraphs (3), (5), (6), and (7) as paragraphs (2), (3), (4), and (5), respectively.
Clerical amendments
Section heading
The heading of section 2366a of title 10, United States Code, is amended to read as follows:
Major defense acquisition programs: determination required before Milestone A approval
.
Table of sections
The table of sections at the beginning of chapter 139 of such title is amended by striking the item relating to section 2366a and inserting the following new item:
2366a. Major defense acquisition programs: determination required before Milestone A approval.
.
Required certification and determination before Milestone B approval of major defense acquisition programs
Determination required in addition to certification
Subsection (a) of section 2366b of title 10, United States Code, is amended—
in the subsection heading, by striking Certification
and inserting Certification and determination required
;
by redesignating paragraph (4) as paragraph (5); and
by striking (3) further certifies that—
and inserting the following:
further certifies that the technology in the program has been demonstrated in a relevant environment, as determined by the Milestone Decision Authority on the basis of an independent review and assessment by the Assistant Secretary of Defense for Research and Engineering, in consultation with the Deputy Assistant Secretary of Defense for Developmental Test and Evaluation;
determines, in writing, that—
.
Submission of written determination to congress
Subsection (c) of such section is amended by adding at the end the following new paragraph:
At the request of any of the congressional defense committees, the Secretary of Defense shall submit to the committee an explanation of the basis for a determination made under subsection (a)(4) with respect to a major defense acquisition program, together with a copy of the written determination. The explanation shall be submitted in unclassified form, but may include a classified annex.
.
National security waiver
Subsection (d) of such section is amended—
in paragraph (1), by striking certification requirement
and inserting certification and determination requirements
; and
in paragraph (2)—
in the matter preceding subparagraph (A) and in subparagraph (A), by inserting waiver
before determination
each place it appears; and
in subparagraph (B), by striking certification components
both places it appears and inserting certification and determination components
.
Conforming amendments
Section 2366b of title 10, United States Code, is further amended—
in subsection (b)(1), by striking paragraph (1) or (2) of subsection (a)
and inserting paragraph (1), (2), or (3) of subsection (a)
;
in subsection (d)(1), by striking paragraph (1), (2), or (3) of subsection (a)
and inserting paragraph (1), (2), (3), or (4) of subsection (a)
; and
in subsection (d)(2)(B), by striking paragraphs (1), (2), and (3) of subsection (a)
and inserting paragraphs (1), (2), (3), and (4) of subsection (a)
.
Clerical amendments
Section heading
The heading of section 2366b of title 10, United States Code, is amended to read as follows:
Major defense acquisition programs: certification and determination required before Milestone B approval
.
Table of sections
The table of sections at the beginning of chapter 139 of such title is amended by striking the item relating to section 2366b and inserting the following new item:
2366b. Major defense acquisition programs: certification and determination required before Milestone B approval.
.
Services Contracting and Related Matters
Examination and guidance relating to oversight and approval of services contracts
Not later than September 15, 2015, the Under Secretary of Defense for Acquisition, Technology, and Logistics shall—
complete an examination of the decision authority related to acquisition of services; and
develop and issue guidance to improve capabilities and processes related to requirements development and source selection for, and oversight and management of, services contracts.
Information Technology Acquisitions and Related Matters
Streamlining of requirements relating to defense business systems
In general
Revision
Section 2222 of title 10, United States Code, is amended to read as follows:
Defense business systems: business process reengineering; enterprise architecture; management
Defense business systems generally
The Secretary of Defense shall ensure that each covered defense business system developed, deployed, and operated by the Department of Defense—
supports efficient business processes that have been reviewed, and as appropriate revised, through business process reengineering;
is integrated into a comprehensive defense business enterprise architecture; and
is managed in a manner that provides visibility into, and traceability of, expenditures for the system.
Issuance of guidance
Secretary of defense guidance
The Secretary shall issue guidance to provide for the coordination of, and decisionmaking for, the planning, programming, and control of investments in covered defense business systems.
Supporting guidance
The Secretary shall direct the Deputy Chief Management Officer of the Department of Defense, the Under Secretary of Defense for Acquisition, Technology, and Logistics, the Chief Information Officer, and the Chief Management Officer of each of the military departments to issue and maintain supporting guidance, as appropriate, for the guidance of the Secretary issued under paragraph (1).
Guidance elements
The guidance issued under subsection (b)(1) shall include the following elements:
Policy to ensure that the business processes of the Department of Defense are continuously reviewed and revised—
to implement the most streamlined and efficient business processes practicable; and
to enable the use of commercial off-the-shelf business systems with the fewest changes necessary to accommodate requirements and interfaces that are unique to the Department of Defense.
A process to establish requirements for covered defense business systems.
Mechanisms for the planning and control of investments in covered defense business systems, including a process for the collection and review of programming and budgeting information for covered defense business systems.
Policy requiring the periodic review of covered defense business systems that have been fully deployed, by portfolio, to ensure that investments in such portfolios are appropriate.
Defense business enterprise architecture
Blueprint
The Secretary, working through the Deputy Chief Management Officer of the Department of Defense, shall develop and maintain a blueprint to guide the development of integrated business processes within the Department of Defense. Such blueprint shall be known as the defense business enterprise architecture
.
Purpose
The defense business enterprise architecture shall be sufficiently defined to effectively guide implementation of interoperable defense business system solutions and shall be consistent with the policies and procedures established by the Director of the Office of Management and Budget.
Elements
The defense business enterprise architecture shall—
include policies, procedures, business data standards, business performance measures, and business information requirements that apply uniformly throughout the Department of Defense; and
enable the Department of Defense to—
comply with all applicable law, including Federal accounting, financial management, and reporting requirements;
routinely produce verifiable, timely, accurate, and reliable business and financial information for management purposes; and
integrate budget, accounting, and program information and systems.
Integration into information technology architecture
The defense business enterprise architecture shall be integrated into the information technology enterprise architecture required under subparagraph (B).
The Chief Information Officer of the Department of Defense shall develop an information technology enterprise architecture. The architecture shall describe a plan for improving the information technology and computing infrastructure of the Department of Defense, including for each of the major business processes conducted by the Department of Defense.
Defense business council
Requirement for council
The Secretary shall establish a Defense Business Council to provide advice to the Secretary on developing the defense business enterprise architecture, reengineering the Department’s business processes, and requirements for defense business systems. The Council shall be chaired by the Deputy Chief Management Officer and the Chief Information Officer of the Department of Defense.
Membership
The membership of the Council shall include the following:
The Chief Management Officers of the military departments, or their designees.
The following officials of the Department of Defense, or their designees:
The Under Secretary of Defense for Acquisition, Technology, and Logistics with respect to acquisition, logistics, and installations management processes.
The Under Secretary of Defense (Comptroller) with respect to financial management and planning and budgeting processes.
The Under Secretary of Defense for Personnel and Readiness with respect to human resources management processes.
Approvals required for development
Initial approval required
The Secretary shall ensure that a covered defense business system program cannot proceed into development (or, if no development is required, into production or fielding) unless the appropriate approval official (as specified in paragraph (2)) approves the program by determining that the covered defense business system concerned—
supports a business process that has been, or is being as a result of the acquisition program, reengineered to be as streamlined and efficient as practicable consistent with the guidance issued pursuant to subsection (b), including business process mapping;
is in compliance with the defense business enterprise architecture developed pursuant to subsection (d) or will be in compliance as a result of modifications planned;
has valid, achievable requirements; and
is in compliance with the Department’s auditability requirements.
Appropriate official
For purposes of paragraph (1), the appropriate approval official with respect to a covered defense business system is the following:
In the case of a system of a military department, the Chief Management Officer of that military department.
In the case of a system of a Defense Agency or Defense Field Activity or a system that will support the business process of more than one military department or Defense Agency or Defense Field Activity, the Deputy Chief Management Officer of the Department of Defense.
In the case of any system, such official other than the applicable official under subparagraph (A) or (B) as the Secretary designates for such purpose.
Annual certification
For any fiscal year in which funds are expended for development pursuant to a covered defense business system program, the Defense Business Council shall review the system and certify (or decline to certify as the case may be) that it continues to satisfy the requirements of paragraph (1). If the Council determines that certification cannot be granted, the chairman of the Council shall notify the appropriate approval official and the acquisition Milestone Decision Authority for the program and provide a recommendation for corrective action.
Obligation of funds in violation of requirements
The obligation of Department of Defense funds for a covered defense business system program that has not been certified in accordance with paragraph (3) is a violation of section 1341(a)(1)(A) of title 31.
Responsibility of milestone decision authority
The Secretary shall ensure that, as part of the defense acquisition system, the requirements of this section are fully addressed by the Milestone Decision Authority for a covered defense business system program as acquisition process approvals are considered for such system.
Annual report
Not later than March 15 of each year from 2016 through 2020, the Secretary shall submit to the congressional defense committees a report on activities of the Department of Defense pursuant to this section. Each report shall include the following:
A description of actions taken and planned with respect to the guidance required by subsection (b) and the defense business enterprise architecture developed pursuant to subsection (d).
A description of actions taken and planned for the reengineering of business processes by the Defense Business Council established pursuant to subsection (e).
A summary of covered defense business system funding and covered defense business systems approved pursuant to subsection (f).
Identification of any covered defense business system program that during the preceding fiscal year was reviewed and not approved pursuant to subsection (f) and the reasons for the lack of approval.
Identification of any covered defense business system program that during the preceding fiscal year failed to achieve initial operational capability within five years after the date the program received Milestone B approval.
For any program identified under paragraph (5), a description of the plan to address the issues that caused the failure.
A discussion of specific improvements in business operations and cost savings resulting from successful covered defense business systems programs.
A copy of the most recent report of the Chief Management Officer of each military department on implementation of business transformation initiatives by such military department in accordance with section 908 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Public Law 110–417; 122 Stat. 4569; 10 U.S.C. 2222 note).
Definitions
In this section:
Defense business system
The term defense business system
means an information system that is operated by, for, or on behalf of the Department of Defense, including any of the following:
A financial system.
A financial data feeder system.
A contracting system.
A logistics system.
A planning and budgeting system.
An installations management system.
A human resources management system.
A training and readiness system.
The term does not include—
a national security system; or
an information system used exclusively by and within the defense commissary system or the exchange system or other instrumentality of the Department of Defense conducted for the morale, welfare, and recreation of members of the armed forces using nonappropriated funds.
Covered defense business system
The term covered defense business system
means a defense business system that is expected to have a total amount of budget authority, over the period of the current future-years defense program submitted to Congress under section 221 of this title, in excess of the threshold established for the use of special simplified acquisition procedures pursuant to section 2304(g)(1)(B) of this title.
Covered defense business system program
The term covered defense business system program
means a defense acquisition program to develop and field a covered defense business system or an increment of a covered defense business system.
Enterprise architecture
The term enterprise architecture
has the meaning given that term in section 3601(4) of title 44.
Information system
The term information system
has the meaning given that term in section 11101 of title 40.
National security system
The term national security system
has the meaning given that term in section 3542(b)(2) of title 44.
Milestone decision authority
The term Milestone Decision Authority
, with respect to a defense acquisition program, means the individual within the Department of Defense designated with the responsibility to grant milestone approvals for that program.
Business process mapping
The term business process mapping
means a procedure in which the steps in a business process are clarified and documented in both written form and in a flow chart.
.
Clerical amendment
The table of sections at the beginning of such chapter is amended by adding at the end the following new item:
2222. Defense business systems: business process reengineering; enterprise architecture; management.
.
Deadline for guidance
The guidance required by subsection (b)(1) of section 2222 of title 10, United States Code, as amended by subsection (a)(1), shall be issued not later than December 31, 2016.
Repeal
Section 811 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109–364; 10 U.S.C. 2222 note) is repealed.
Industrial Base Matters
Codification and amendment of Mentor-Protege Program
In general
Section 831 of the National Defense Authorization Act for Fiscal Year 1991 (Public Law 101–510; 104 Stat. 1607; 10 U.S.C. 2302 note) is transferred to chapter 137 of title 10, United States Code, inserted so as to appear after section 2323a, redesignated as section 2323b, and amended—
by amending the section heading to read as follows:
Mentor-Protege Program
;
by striking pilot
each place such term appears;
by amending subsection (e)(1) to read as follows:
A developmental program for the protege firm, in such detail as may be reasonable, including—
factors to assess the protege firm's developmental progress under the program; and
the anticipated number and type of subcontracts to be awarded to the protege firm.
;
in subsection (g)(2)(B), by striking under subsection (l)(2)
;
in subsection (h)(1), by inserting (15 U.S.C. 631 et seq.)
after Small Business Act
;
by striking subsection (j) and redesignating subsections (k) and (l) as subsections (j) and (k), respectively;
by amending subsection (j) (as so redesignated) to read as follows:
Regulations
The regulations implementing the Mentor-Protege Pilot Program established under section 831 of the National Defense Authorization Act for Fiscal Year 1991 (Public Law 101–510; 104 Stat. 1607; 10 U.S.C. 2302 note) as in effect on March 25, 2015, shall apply to this section. The Secretary of Defense may revise such regulations or prescribe additional regulations necessary to carry out this section. The Department of Defense policy regarding the Mentor-Protege Program shall be published and maintained as an appendix to the Department of Defense Supplement to the Federal Acquisition Regulation.
;
by striking prescribed pursuant to subsection (k)
each place such term appears and inserting described in subsection (j)
; and
in subsection (k) (as so redesignated)—
in paragraph (1), by striking means a business concern that meets the requirements of section 3(a) of the Small Business Act (15 U.S.C. 632(a)) and the regulations promulgated pursuant thereto
and inserting has the meaning given such term under section 3 of the Small Business Act (15 U.S.C. 632)
;
in paragraph (2)—
in subparagraph (D), by striking the severely disabled
and inserting severely disabled individuals
; and
in subparagraph (G), by inserting (15 U.S.C. 632(p))
after Small Business Act
;
in paragraph (4), by striking of title 10, United States Code
and inserting of this title
; and
by amending paragraph (8) to read as follows:
The term severely disabled individual means an individual who is blind (as defined in section 8501 of title 41) or a severely disabled individual (as defined in such section).
.
Clerical amendment
The table of sections at the beginning of such chapter is amended by inserting after the item relating to section 2323a the following new item:
2323b. Mentor-Protege Program.
.
Amendments to data quality improvement plan
In general
Section 15(s) of the Small Business Act (15 U.S.C. 644(s)) is amended—
by redesignating paragraph (4) as paragraph (6); and
by inserting after paragraph (3) the following new paragraphs:
Implementation
Not later than the first day of fiscal year 2017, the Administrator of the Small Business Administration shall implement the plan described in this subsection.
Certification
The Administrator shall annually provide to the Committee on Small Business of the House of Representatives and the Committee on Small Business and Entrepreneurship of the Senate a certification of the accuracy and completeness of data reported on bundled and consolidated contracts.
.
GAO study
Study
Not later than the first day of fiscal year 2018, the Comptroller General of the United States shall initiate a study on the effectiveness of the plan described in section 15(s) of the Small Business Act (15 U.S.C. 644(s)) that shall assess whether contracts were accurately labeled as bundled or consolidated.
Contracts evaluated
For the purposes of conducting the study described in paragraph (1), the Comptroller General of the United States—
shall evaluate, for work in each of sectors 23, 33, 54, and 56 (as defined by the North American Industry Classification System), not fewer than 100 contracts in each sector;
shall evaluate only those contracts—
awarded by an agency listed in section 901(b) of title 31, United States Code; and
that have a Base and Exercised Options Value, an Action Obligation, or a Base and All Options Value (as such terms are defined in the Federal procurement data system described in section 1222(a)(4)(A) of title 41, United States Code, or any successor system); and
shall not evaluate contracts that have used any set aside authority.
Report
Not later than 12 months after initiating the study required by paragraph (1), the Comptroller General of the United States shall report to the Committee on Small Business of the House of Representatives and the Committee on Small Business and Entrepreneurship of the Senate on the results from such study and, if warranted, any recommendations on how to improve the quality of data reported on bundled and consolidated contracts.
Notice of contract consolidation for acquisition strategies
Notice requirement for the senior procurement executive or Chief Acquisition Officer
Section 44(c)(2) of the Small Business Act (15 U.S.C. 657q(c)(2)) is amended by adding at the end the following:
Notice
Not later than 7 days after making a determination that an acquisition strategy involving a consolidation of contract requirements is necessary and justified under subparagraph (A), the senior procurement executive or Chief Acquisition Officer shall publish a notice on a public website that such determination has been made. Any solicitation for a procurement related to the acquisition strategy may not be published earlier than 7 days after such notice is published. Along with the publication of the solicitation, the senior procurement executive or Chief Acquisition Officer shall publish a justification for the determination, which shall include the information in subparagraphs (A) through (E) of paragraph (1).
.
Notice requirement for the head of a contracting agency
Section 15(e)(3) of the Small Business Act (15 U.S.C. 644(e)(3)) is amended to read as follows:
Strategy specifications
If the head of a contracting agency determines that an acquisition plan for a procurement involves a substantial bundling of contract requirements, the head of a contracting agency shall publish a notice on a public website that such determination has been made not later than 7 days after making such determination. Any solicitation for a procurement related to the acquisition plan may not be published earlier than 7 days after such notice is published. Along with the publication of the solicitation, the head of a contracting agency shall publish a justification for the determination, which shall include following information:
The specific benefits anticipated to be derived from the bundling of contract requirements and a determination that such benefits justify the bundling.
An identification of any alternative contracting approaches that would involve a lesser degree of bundling of contract requirements.
An assessment of—
the specific impediments to participation by small business concerns as prime contractors that result from the bundling of contract requirements; and
the specific actions designed to maximize participation of small business concerns as subcontractors (including suppliers) at various tiers under the contract or contracts that are awarded to meet the requirements.
.
Technical amendment
Section 44(c)(1) of the Small Business Act (15 U.S.C. 657q(c)(1)) is amended by striking Subject to paragraph (4), the head
and inserting The head
.
Clarification of requirements related to small business contracts for services
Procurement contracts
Section 8(a)(17) of the Small Business Act (15 U.S.C. 637(a)(17)) is amended—
in subparagraph (A), by striking any procurement contract
and all that follows through section 15
and inserting any procurement contract, which contract has as its principal purpose the supply of a product to be let pursuant to this subsection or subsection (m), or section 15(a), 31, or 36,
; and
by adding at the end the following new subparagraph:
Limitation
This paragraph shall not apply to a contract that has as its principal purpose the acquisition of services or construction.
.
Subcontractor contracts
Section 46(a)(4) of the Small Business Act (15 U.S.C. 657s(a)(4)) is amended by striking for supplies from a regular dealer in such supplies
and inserting which is principally for supplies from a regular dealer in such supplies, and which is not a contract principally for services or construction,
.
Review of Government access to intellectual property rights of private sector firms
Review required
The Secretary of Defense shall direct the Defense Business Board to conduct a review of Department of Defense regulations and practices, and laws authorizing such regulations and practices, related to Government access to and use of intellectual property rights of private sector firms.
Report
Not later than March 1, 2016, the Secretary shall submit to the congressional defense committees a report on the findings of the Defense Business Board, along with any actions the Secretary proposes to revise and clarify laws or regulations related to intellectual property rights.
Modifications to the Small Business Innovative Research Program and the Small Business Technology Transfer Program
Section 9 of the Small Business Act (15 U.S.C. 638) is amended—
in subsection (b)—
in paragraph (1), by striking development;
and inserting development, particularly contracts for research and development supporting defense and national security missions and programs;
; and
in paragraph (3), by striking ; and
and inserting a semicolon;
in subsection (e)—
in paragraph (4)(C)(i), by inserting or non-Federal sources of capital
after funding awards
; and
in paragraph (6)(C)(i), by inserting or non-Federal sources of capital
after funding awards
;
in subsection (f)—
in paragraph (1), by striking paragraph (2)(B)
and inserting paragraphs (2)(B) and (5)
; and
by adding at the end the following new paragraph:
Required expenditures for military departments
The Secretary of each military department shall expend, in connection with SBIR, not less than 2.9 percent and not more than 5 percent of each such military department’s extramural budget for research or research and development for fiscal year 2018 and each subsequent fiscal year.
;
in subsection (g)(3)—
in subparagraph (A), by striking ; or
and inserting a semicolon;
in subparagraph (B), by inserting or
after the semicolon; and
by adding at the end the following new subparagraph:
the Secretary of Defense and as applied to the Department of Defense and each military department, in the quadrennial defense review (described in section 118 of title 10, United States Code) and other strategies or reports that direct the research and development and acquisition processes of the Department of Defense;
;
in subsection (j), by adding at the end the following new paragraph:
Modifications related to military departments
Not later than 90 days after March 25, 2015, the Administrator shall modify the policy directives issued pursuant to this subsection to establish the authority of each Secretary of a military department to manage and operate the SBIR program funded under subsection (f)(5).
;
in subsection (k)(2)—
by striking subsection (f)(1)
and inserting paragraphs (1) and (4) of subsection (f)
; and
by striking subsection (n)(1)
and inserting paragraphs (1) and (4) of subsection (n)
;
in subsection (m), by inserting , except as provided in subsections (f)(5) and (n)(4)
after 2017
;
in subsection (n)—
in paragraph (1)(B), by striking The percentage
and inserting Except as provided in paragraph (4), the percentage
; and
by adding at the end the following new paragraph:
Required expenditure for military departments
The Secretary of each military department shall expend, in connection with STTR, not more than 5 percent of each such military department’s extramural budget for research or research and development for fiscal year 2018 and each subsequent fiscal year.
;
in subsection (o)(3)(B), by striking Code;
and inserting Code, and in other reports that direct the research and development and acquisition processes of the Department of Defense;
;
in subsection (p), by adding at the end the following new paragraph:
Modifications related to military departments
Not later than 90 days after the date of enactment of the Agile Acquisition to Retain Technological Edge Act, the Administrator shall modify the policy directives issued pursuant to this subsection to establish the authority of each Secretary of a military department to manage and operate the STTR program funded under subsection (n)(4).
;
in subsection (r)(4), by adding at the end the following sentence: For the Department of Defense, such Phase III awards shall be made in conformance with defense and national security missions and programs.
;
in subsection (x)(2)(B), by inserting (or its successor)
before the period at the end;
in subsection (aa)(4)—
in the paragraph heading, by inserting or project
after topic
; and
by inserting or project
after topic
;
in subsection (bb)(1), by striking another Federal agency
and inserting one or more other Federal agencies
;
in subsection (ff)(1)—
by striking 1 additional Phase II SBIR award or Phase II STTR award
and inserting one or more additional Phase II SBIR awards or Phase II STTR awards
; and
by inserting from one or more Federal agencies
after project
; and
in subsection (qq)(2), by adding at the end the following new subparagraph:
Implementation deadline
The head of each Federal agency shall implement the requirements described under subparagraph (A) not later than December 31, 2017.
.
Extension of defense research and development rapid innovation program
Subsection (d) of section 1073 of the Ike Skeleton National Defense Authorization Act for Fiscal Year 2011 (Public Law 111–383; 124 Stat. 4366; 10 U.S.C. 2359 note) is amended by striking through 2015
and inserting through 2020
.
Repeal or Revision of Reporting Requirements
Repeal of certain reporting requirements
Reports Related to Military Personnel Issues (Other Than Health Care)
Report on voting assistance programs effectiveness and compliance
Section 1566(c) of title 10, United States Code, is amended—
by striking (1)
after the subsection heading; and
by striking paragraphs (2) and (3).
Report on aviation officer retention bonuses
Section 301b(i) of title 37, United States Code, is amended—
by striking (1)
after the subsection heading; and
by striking paragraph (2).
Report on foreign language proficiency incentive pay
Section 316a of title 37, United States Code, as amended by section 615(5) of this Act, is amended—
by striking subsection (f); and
by redesignating subsection (g) as subsection (f).
Report on use of waiver authority for military service academy appointments
Section 553 of the National Defense Authorization Act for Fiscal Year 2012 (Public Law 112–81; 10 U.S.C. 4346 note) is amended—
by striking subsection (e); and
by redesignating subsection (f) as subsection (e).
Report on increase in Junior Reserve Officers' Training Corps units
Subsection (e) of section 548 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Public Law 110–417; 122 Stat. 4466) is repealed.
Report on implementation of yellow ribbon reintegration program
Reporting requirement
Section 582(e) of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110–181; 10 U.S.C. 10101 note) is amended by striking paragraph (4).
Conforming repeal
Section 597 of the National Defense Authorization Act for Fiscal Year 2010 (Public Law 111–84; 10 U.S.C. 10101 note) is repealed.
Report on local educational agency Assistance related to DOD activities
Section 574 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109–364; 20 U.S.C. 7703b note) is amended—
by striking subsection (c); and
by redesignating subsections (d) and (e) as subsections (c) and (d), respectively.
Reports related to health care
Reports on health protection quality and health assessment data
Section 1073b of title 10, United States Code, is repealed.
The table of sections at the beginning of chapter 55 of title 10, United States Code, is amended by striking the item relating to section 1073b.
Report on standards of facilities
Section 1648 of the Wounded Warrior Act (10 U.S.C. 1071 note) is amended by striking subsection (f).
Report on inspections of facilities
Section 1662 of the Wounded Warrior Act (10 U.S.C. 1071 note) is amended—
by striking (a) Required inspections of facilities.—
; and
by striking subsection (b).
Report on inspections of other facilities
Section 3307 of the U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007 (10 U.S.C. 1073 note) is amended—
by striking subsection (d); and
by redesignating subsection (e) as subsection (d).
Reports related to readiness
Report on Arsenal Support Program Initiative
Section 323 of the Floyd Spence National Defense Authorization Act for Fiscal Year 2001 (Public Law 106–398; 10 U.S.C. 4551 note) is amended by striking subsection (g).
GAO review of contractor-operated civil engineering supply stores program
Section 345 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (Public Law 105–26; 112 Stat. 1978) is amended—
by striking subsection (d); and
by redesignating subsection (e) as subsection (d).
Reports related to naval vessels and Merchant Marine
Report on naming of naval vessels
Section 7292 of title 10, United States Code, is amended by striking subsection (d).
Report on transfer of vessels stricken from naval vessel register
Section 7306 of title 10, United States Code, is amended—
by striking subsection (d); and
by redesignating subsections (e) and (f) as subsections (d) and (e), respectively.
Reports on mission modules of Littoral Combat Ship
Section 126 of the National Defense Authorization Act for Fiscal Year 2013 (Public Law 112–239) is amended—
by striking (b) Additional Quarterly Reports.—
; and
by striking subsection (b).
Report on cost estimate of CVN–79
Section 122 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109–364; 120 Stat. 2104), as most recently amended by section 121 of the National Defense Authorization Act for Fiscal Year 2014 (Public Law 113–66), is amended by striking subsection (f).
Report on assessments of first ship of a shipbuilding program
Section 124 of the National Defense Authorization Act for Fiscal Year 2008 is repealed.
Annual report of Federal Maritime Commission
Section 50111 of title 46, United States Code, is repealed.
The table of sections at the beginning of chapter 501 of title 46, United States Code, is amended by striking the item relating to section 50111.
Discretionary reports no longer needed
The Secretary of the Navy is not required to submit to the congressional defense committees—
a report, or updates to such a report, on open architecture as described in Senate Report 110–077; or
a monthly report on Ford class aircraft carriers not otherwise required by law.
Reports related to nuclear, proliferation, and related matters
Report on Proliferation Security Initiative
Section 1821(b) of the Implementing Recommendations of the 9/11 Commission Act of 2007 (50 U.S.C. 2911) is amended—
by striking (1) In general.—
; and
by striking paragraphs (2) and (3).
Report on warhead life extension options
The National Defense Authorization Act for Fiscal Year 2014 (Public Law 113–66) is amended by repealing section 3118.
Report on Nuclear Weapons Council
Section 179 of title 10, United States Code, is amended by striking subsection (g).
Briefings on dialogue between United States and Russian Federation on nuclear arms
Section 1282 of the National Defense Authorization Act for Fiscal Year 2013 (22 U.S.C. 5951 note) is amended—
by striking subsection (a); and
by redesignating subsections (b) and (c) as subsections (a) and (b), respectively.
Implementation plan for whole-of- government vision prescribed in the national security strategy
Section 1072 of the National Authorization Act for Fiscal Year 2012 (50 U.S.C. 3043 note) is amended—
by striking (a) Implementation plan.—
;
by striking subsection (b); and
by redesignating subsection (c) as subsection (b).
Reports related to missile defense
Report on ground-based midcourse defense program
Section 234 of the National Defense Authorization Act for Fiscal Year 2012 (Public Law 112–81; 125 Stat. 1340) is amended—
by striking (a) Sense of Congress.—
; and
by striking subsection (b).
Report on Missile Defense Executive Board activities
Section 232 of the National Defense Authorization Act for Fiscal Year 2012 (Public Law 112–81; 125 Stat. 1339) is amended—
by striking subsection (b); and
by redesignating subsection (c) as subsection (b).
Reports related to acquisition
Report on foreign purchases
Section 8305 of title 41, United States Code, is repealed.
Report on cost assessment activities
Section 2334 of title 10, United States Code, is amended—
by striking subsection (f); and
by redesignating subsection (g) as subsection (f).
Report on performance assessments and root cause analyses
Section 2438 of title 10, United States Code, is amended by striking subsection (f).
Reports related to civilian personnel
Report on experimental program for scientific and technical personnel
Section 1101 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (Public Law 105–261; 112 Stat. 2139) is amended by striking subsection (g).
Report on pilot program for exchange of information technology personnel
Section 1110 of the National Defense Authorization Act for Fiscal Year 2010 (Public Law 111–84; 123 Stat. 2493) is amended—
by striking subsection (i);
by redesignating subsection (j) as subsection (i); and
in subsection (i) (as redesignated by subparagraph (B)), by amending paragraph (2) to read as follows:
any employee whose assignment is allowed to continue by virtue of paragraph (1) shall be taken into account for purposes of the numerical limitation under subsection (h).
.
GAO report with respect to Department of Defense performance management and workforce incentive system
Section 9902(h) of title 5, United States Code, is amended—
in paragraph (1)(B), by striking and the Comptroller General,
;
by striking paragraph (2); and
by redesignating paragraph (3) as paragraph (2).
Miscellaneous Reports
Report on rewards for combating terrorism
Section 127b of title 10, United States Code, is amended—
by striking subsection (f); and
by redesignating subsection (g) as subsection (f).
Report on technological maturity and integration risk of critical technologies
Section 138b of title 10, United States Code, is amended—
by striking paragraph (2); and
by striking (b)(1)
and inserting (b)
.
Report on systems engineering
Section 139b(d) of title 10, United States Code, is amended—
by striking paragraph (2);
by redesignating paragraph (3) as paragraph (2);
in paragraph (2), as redesignated by subparagraph (B)—
by striking or (2)
;
in subparagraph (A), by striking systems engineering master plans and
;
in subparagraph (B), by striking , systems engineering master plans,
;
in subparagraph (C), by striking systems engineering, development planning,
and inserting development planning
; and
by redesignating subparagraph (D) as subparagraph (F);
by transferring subparagraphs (A) and (B) of paragraph (4) to paragraph (2), as so redesignated, and redesignating those subparagraphs as subparagraphs (D) and (E), respectively; and
by striking paragraph (4).
Report on humanitarian demining assistance authority
Section 407 of title 10, United States Code, is amended—
by striking subsection (d); and
by redesignating subsection (e) as subsection (d).
Report on Regional Defense Counterterrorism Fellowship Program
Section 2249c of title 10, United States Code, is amended by striking subsection (c).
Report on space science and technology strategy
Section 2272(a) of title 10, United States Code, is amended by striking paragraph (5).
Report on DARPA
Repeal
Section 2352 of title 10, United States Code, is repealed.
Clerical amendment
The table of sections at the beginning of chapter 139 of title 10, United States Code, is amended by striking the item relating to section 2352.
Report on airlift requirements
Section 112 of the National Defense Authorization Act for Fiscal Year 2013 (Public Law 112–239; 126 Stat. 1654) is repealed.
Report on interagency collaboration on unmanned aircraft systems
Section 1052(b) of the National Defense Authorization Act for Fiscal Year 2013 (Public Law 112–239; 49 U.S.C. 40101 note) is amended by striking paragraph (4).
Report on in-kind payments
Section 2805 of the National Defense Authorization Act for Fiscal Year 2013 (Public Law 112–239; 126 Stat. 2149) is repealed.
Report on airborne signals intelligence, surveillance, and reconnaissance capabilities
Section 112(b) of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011 (Public Law 111–383; 124 Stat. 4153) is amended—
by striking paragraph (3); and
by redesignating paragraph (4) as paragraph (3).
Reports on status of Navy Next Generation Enterprise Networks Program
Section 1034 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Public Law 110–417; 122 Stat. 4593) is repealed.
Planning, Budgeting, Contracting, Oversight, and Other Related Matters
Additional responsibility for Director of Operational Test and Evaluation
Additional responsibility
Section 139 of title 10, United States Code, is amended—
by redesignating subsections (c), (d), (e), (f), (g), (h), (i), (j), and (k) as subsections (d), (e), (f), (g), (h), (i), (j), (k), and (l), respectively; and
by inserting after subsection (b) the following new subsection (c):
The Director shall consider the potential for increases in program cost estimates or delays in schedule estimates in the implementation of policies, procedures, and activities related to operational test and evaluation and shall take appropriate action to ensure that operational test and evaluation activities do not unnecessarily increase program costs or impede program schedules.
.
Conforming amendment
Section 196(c)(1)(A)(ii) of such title is amended by striking section 139(i)
and inserting section 139(k)
.
Report on linking and streamlining requirements, acquisition, and budget processes within Armed Forces
Reports
Not later than 180 days after the date of the enactment of this Act, the Chief of Staff of the Army, the Chief of Naval Operations, the Chief of Staff of the Air Force, and the Commandant of the Marine Corps shall each submit to the congressional defense committees a report on efforts to link and streamline the requirements, acquisition, and budget processes within the Army, Navy, Air Force, and Marine Corps, respectively.
Matters included
Each report under subsection (a) shall include the following:
A specific description of—
the management actions the Chief concerned or the Commandant has taken or plans to take to link and streamline the requirements, acquisition, and budget processes of the Armed Force concerned;
any reorganization or process changes that will link and streamline the requirements, acquisition, and budget processes of the Armed Force concerned; and
any cross-training or professional development initiatives of the Chief concerned or the Commandant.
For each description under paragraph (1)—
the specific timeline associated with implementation;
the anticipated outcomes once implemented; and
how to measure whether or not those outcomes are realized.
Any other matters the Chief concerned or the Commandant considers appropriate.
Required review of acquisition-related functions of the Chiefs of Staff of the Armed Forces
Review required
The Chief of Staff of the Army, the Chief of Naval Operations, the Chief of Staff of the Air Force, and the Commandant of the Marine Corps shall conduct a review of their current individual authorities provided in sections 3033, 5033, 8033, and 5043 of title 10, United States Code, and other relevant statutes and regulations related to defense acquisitions for the purpose of developing such recommendations as the Chief concerned or the Commandant considers necessary to further or advance the role of the Chief concerned or the Commandant in the development of requirements, acquisition processes, and the associated budget practices of the Department of Defense.
Reports
Not later than September 15, 2015, the Chief of Staff of the Army, the Chief of Naval Operations, the Chief of Staff of the Air Force, and the Commandant of the Marine Corps shall each submit to the congressional defense committees a report containing, at a minimum, the following:
The recommendations developed by the Chief concerned or the Commandant under subsection (a) and other results of the review conducted under such subsection.
The actions the Chief concerned or the Commandant is taking, if any, within the Chief’s or Commandant’s existing authority to implement such recommendations.
FAR Council membership for Administrator of Small Business Administration
Addition of Administrator of Small Business Administration to Federal Acquisition Regulatory Council
Section 1302(b)(1) of title 41, United States Code, is amended—
by striking and
at the end of subparagraph (C);
by striking the period and inserting ; and
at the end of subparagraph (D); and
by adding at the end the following new subparagraph:
the Administrator of the Small Business Administration.
.
Conforming amendments
Such title is amended—
in section 1303(a)(1)—
by striking and the Administrator of National Aeronautics and Space,
and inserting the Administrator of National Aeronautics and Space, and the Administrator of the Small Business Administration,
; and
by striking and the National Aeronautics and Space Act of 1958 (42 U.S.C. 2451 et seq.),
and inserting the National Aeronautics and Space Act of 1958 (42 U.S.C. 2451 et seq.), and the Small Business Act (15 U.S.C. 631 et seq.),
; and
in section 1121(d), by striking and the General Services Administration
and inserting the General Services Administration, and the Small Business Administration
.
Independent study of matters related to bid protests
Requirement for study
Not later than 60 days after the date of the enactment of this Act, the Secretary of Defense shall enter into a contract with an independent research entity that is a not-for-profit entity or a federally funded research and development center with appropriate expertise and analytical capability to carry out a comprehensive study of factors leading to the filing of bid protests. The study shall examine issues such as the following:
The variable influences on the net benefit (monetary and non-monetary) to contractors either filing a protest or indicating intent to file a protest.
The extent to which protests are filed by incumbent contractors for purposes of extending a contract’s period of performance.
The extent to which companies file protests even if they do not contest that there was an error in the procurement process.
Report
Not later than one year after the date of the enactment of this Act, the independent entity shall provide to the Secretary and the congressional defense committees a report on the results of the study, along with any recommendations it may have.
Procurement of commercial items
Delegation of Responsibility for Commercial Item Determinations
Section 2375 of title 10, United States Code, is amended by adding at the end the following new subsection:
Delegation of Responsibility Within Department of Defense for Commercial Item Determinations
The Secretary of Defense shall designate an individual within the Department of Defense to be responsible for making determinations that, for the purpose of procurement of an item by a component of the Department of Defense, an item is a commercial item as described in section 103 of title 41. The Secretary shall ensure that the designated individual receives sufficient—
staff and resources so that determinations are made in an expedient manner; and
staff support or authorities (or both) to provide technical expertise on the functionality of an item subject to determination and expertise in conducting market research related to the item.
The Secretary of Defense shall provide public access to Department of Defense determinations regarding whether an item is a commercial item for the purpose of procurement by a component of the Department of Defense. Each determination shall include a summary explanation of the basis for the determination.
.
Commercial item exception to submission of cost and pricing data
Section 2306a(b) of title 10, United States Code, is amended by adding at the end the following new paragraph:
Consideration of determination of commercial item
For purposes of applying the commercial item exception under paragraph (1)(B) to the required submission of certified cost or pricing data, the contracting officer shall use the determinations made by the individual designated by the Secretary of Defense under section 2375(d) of this title.
.
Implementation
The Secretary of Defense shall ensure that the requirements of sections 2375(d) and 2306a(b)(4) of title 10, United States Code, as added by this section, are implemented not later than 180 days after the date of the enactment of this Act to ensure that sufficient capability is available within the Department of Defense to make necessary determinations in a timely manner.
Amendment relating to multiyear contract authority for acquisition of property
Paragraph (1) of section 2306b(a) of title 10, United States Code, is amended to read as follows:
That there is a reasonable expectation that the use of such a contract will result in lower total anticipated costs of carrying out the program than if the program were carried out through annual contracts.
.
Use of recent prices paid by the Government in the determination of price reasonableness
Section 2306a(b) of title 10, United States Code, as amended by section 706, is further amended by adding at the end the following new paragraph:
A contracting officer may consider evidence provided by an offeror of recent purchase prices paid by the Government for identical or similar commercial items in establishing price reasonableness on a subsequent purchase if the contracting officer is satisfied that the prices previously paid remain a valid reference for comparison after considering the totality of other relevant factors such as the time elapsed since the prior purchase and any differences in the quantities purchased or applicable terms and conditions.
.
Codification of other transaction authority for certain prototype projects
In general
Section 845 of the National Defense Authorization Act for Fiscal Year 1994 (Public Law 103–160; 10 U.S.C. 2371 note) is transferred to chapter 139 of title 10, United States Code, inserted so as to appear after section 2371a, redesignated as section 2371b, and amended—
by amending the section heading to read as follows:
Authority of the Advanced Research Projects Agency to carry out certain prototype projects
;
by striking of title 10, United States Code
each place it appears and inserting of this title
;
by striking of title 41, United States Code
each place it appears and inserting of title 41
;
by amending subparagraph (B) of subsection (d)(1) to read as follows:
all parties to the transaction other than the Federal Government are innovative small business and nontraditional contractors with unique capabilities relevant to the prototype project.
; and
by striking subsection (i).
Clerical amendment
The table of sections at the beginning of such chapter is amended by inserting after the item relating to section 2371a the following new item:
2371b. Authority of the Advanced Research Projects Agency to carry out certain prototype projects.
.
Amendments to certain acquisition thresholds
Simplified acquisition threshold generally
Section 134 of title 41, United States Code, is amended by striking $100,000
and inserting $500,000
.
Micro-Purchase threshold
Section 1902(a) of title 41, United States Code, is amended by striking $3,000
and inserting $5,000
.
Special emergency procurement authority
Section 1903(b)(2) of title 41, United States Code, is amended—
in subparagraph (A), by striking $250,000
and inserting $750,000
; and
in subparagraph (B), by striking $1,000,000
and inserting $1,500,000
.
Small business concern reservation
Section 15(j)(1) of the Small Business Act (15 U.S.C. 644(j)(1)) is amended by striking $100,000
and inserting $500,000
.
Revision of method of rounding when making inflation adjustment of acquisition-related dollar thresholds
Section 1908(e)(2) of title 41, United States Code, is amended—
in the matter preceding subparagraph (A), by striking on the day before the adjustment
and inserting as calculated under paragraph (1)
;
by striking and
at the end of subparagraph (C); and
by striking subparagraph (D) and inserting the following new subparagraphs:
not less than $1,000,000, but less than $10,000,000, to the nearest $500,000;
not less than $10,000,000, but less than $100,000,000, to the nearest $5,000,000;
not less than $100,000,000, but less than $1,000,000,000, to the nearest $50,000,000; and
$1,000,000,000 or more, to the nearest $500,000,000.
.
Repeal of requirement for stand-alone manpower estimates for major defense acquisition programs
Repeal of requirement
Subsection (a)(1) of section 2434 of title 10, United States Code, is amended by striking and a manpower estimate for the program have
and inserting has
.
Conforming amendments relating to regulations
Subsection (b) of such section is amended—
by striking paragraph (2);
by striking shall require—
and all that follows through that the independent
and inserting shall require that the independent
;
by redesignating subparagraphs (A) and (B) as paragraphs (1) and (2), respectively, and realigning those paragraphs so as to be two ems from the left margin; and
in paragraph (2), as so redesignated—
by striking and operations and support,
and inserting operations and support, and manpower to operate, maintain, and support the program upon full operational deployment,
; and
by striking ; and
at the end and inserting a period.
Clerical amendments
Section heading
The heading of such section is amended to read as follows:
Independent cost estimates
.
Table of sections
The item relating to such section in the table of sections at the beginning of chapter 144 of such title is amended to read as follows:
2434. Independent cost estimates.
.