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

Subtitle A--Acquisition Policy and Management

P. L. 111-

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

From H. R. 6523

SEC. 802. DESIGNATION OF ENGINE DEVELOPMENT AND PROCUREMENT PROGRAM AS MAJOR SUBPROGRAM.

(a) Designation as Major Subprogram- Not later than 30 days after the date of the enactment of this Act, the Secretary of Defense shall designate an engine development and procurement program as a major subprogram of the F-35 Lightning II aircraft major defense acquisition program, in accordance with section 2430a of title 10, United States Code.

(b) Original Baseline- For purposes of reporting requirements referred to in section 2430a(b) of title 10, United States Code, for the major subprogram designated under subsection (a), the Secretary shall use the Milestone B decision as the original baseline for the subprogram.

(c) Actions Following Critical Cost Growth-

(1) IN GENERAL- Subject to paragraph (2), to the extent that the Secretary elects to restructure the Lightning II aircraft major defense acquisition program subsequent to a reassessment and actions required by subsections (a) and (c) of section 2433a of title 10, United States Code, during fiscal year 2010, and also conducts such reassessment and actions with respect to an F-35 engine development and procurement program (including related reporting based on the original baseline as defined in subsection (c)), the requirements of section 2433a of such title with respect to a major subprogram designated under subsection (a) shall be considered to be met with respect to the major subprogram.

(2) LIMITATION- Actions taken in accordance with paragraph (1) shall be considered to meet the requirements of section 2433a of title 10, United States Code, with respect to a major subprogram designated under subsection (a) only to the extent that designation as a major subprogram would require the Secretary of Defense to conduct a reassessment and take actions pursuant to such section 2433a for such a subprogram upon enactment of this Act. The requirements of such section 2433a shall not be considered to be met with respect to such a subprogram in the event that additional programmatic changes, following the date of the enactment of this Act, cause the program acquisition unit cost or procurement unit cost of such a subprogram to increase by a percentage equal to or greater than the critical cost growth threshold (as defined in section 2433(a)(5) of such title) for the subprogram.

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

SEC. 802. DESIGNATION OF F135 AND F136 ENGINE DEVELOPMENT AND PROCUREMENT PROGRAMS AS MAJOR SUBPROGRAMS.

(a) Designation as Major Subprograms- Not later than 30 days after the date of the enactment of this Act, the Secretary of Defense shall designate each of the engine development and procurement programs described in subsection (b) as a major subprogram of the F-35 Lightning II aircraft major defense acquisition program, in accordance with section 2430a of title 10, United States Code.

(b) Description- For purposes of subsection (a), the engine development and procurement programs are the following:

(1) The F135 engine development and procurement program.

(2) The F136 engine development and procurement program.

(c) Original Baseline- For purposes of reporting requirements referred to in section 2430a(b) of title 10, United States Code, for the major subprograms designated under subsection (a), the Secretary shall use the Milestone B decision for each subprogram as the original baseline for the subprogram.

(d) Actions Following Critical Cost Growth-

(1) IN GENERAL- Subject to paragraph (2), to the extent that the Secretary elects to restructure the F-35 Lightning II aircraft major defense acquisition program subsequent to a reassessment and actions required by subsections (a) and (c) of section 2433a of title 10, United States Code, during fiscal year 2010, and also conducts such reassessment and actions with respect to the F135 and F136 engine development and procurement programs (including related reporting based on the original baseline as defined in subsection (c)), the requirements of section 2433a of such title with respect to a major subprogram designated under subsection (a) shall be considered to be met with respect to the major subprogram.

(2) LIMITATION- Actions taken in accordance with paragraph (1) shall be considered to meet the requirements of section 2433a of title 10, United States Code, with respect to a major subprogram designated under subsection (a) only to the extent that designation as a major subprogram would require the Secretary of Defense to conduct a reassessment and take actions pursuant to such section 2433a for such a subprogram upon enactment of this Act. The requirements of such section 2433a shall not be considered to be met with respect to such a subprogram in the event that additional programmatic changes, following the date of the enactment of this Act, cause the program acquisition unit cost or procurement unit cost of such a subprogram to increase by a percentage equal to or greater than the critical cost growth threshold (as defined in section 2433(a)(5) of such title) for the subprogram.

Designation of engine development and procurement program as major subprogram (sec. 802)

The House bill contained a provision (sec. 802) that would require the Secretary of Defense to designate the F135 and F136 engine development and procurement programs as major subprograms of the F-35 Lightning II aircraft major defense acquisition program, in accordance with section 2430a of title 10, United States Code.

The Senate committee-reported bill contained no similar provision.

The agreement includes the House provision, amended to require that the Secretary designate an F-35 engine development and procurement program as a major subprogram.

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

SECTION 802--DESIGNATION OF F135 AND F136 ENGINE DEVELOPMENT AND PROCUREMENT PROGRAMS AS MAJOR SUBPROGRAMS

This section would require the Secretary of Defense, within 30 days of the date of enactment of this Act, to designate the F135 and F136 engine development and procurement programs as major subprograms in accordance with section 2430a of title 10, United States Code, and would require the Secretary to use the milestone B decision for the F135 and F136 engine development and procurement programs as the baseline for the reporting requirements referred to in section 2430a(b) of title 10, United States Code.

This section would specify the application of section 2433a of title 10, United States Code, (commonly referred to as Nunn-McCurdy) to the engine subprograms designated under this section. If an engine subprogram designated under this section were to breach one of the Nunn-McCurdy thresholds for critical cost growth, the Secretary of Defense may satisfy the Nunn-McCurdy requirements for reevaluating the engine subprogram if the Secretary fully reevaluated the engine subprogram (including associated reporting in a Selected Acquisition Report) as part of the fiscal year 2010 review caused by a Nunn-McCurdy breach of the F-35 program. If the Secretary does not take such actions for an engine subprogram as part of the Nunn-McCurdy review of the F-35 program in fiscal year 2010, or if future program changes result in unit cost growth that exceeds a Nunn-McCurdy critical cost growth threshold, an engine subprogram would still be subject to the requirements of section 2433a of title 10, United States Code.