U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

1 

89–010 

" ! SENATE 

111TH CONGRESS

2d Session 

REPORT

2010

111–179 

Calendar No. 364 

INFORMATION TECHNOLOGY (IT) INVESTMENT OVERSIGHT ENHANCEMENT AND 

WASTE PREVENTION ACT OF 2009 

R E P O R T 

OF THE

COMMITTEE ON HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

TO ACCOMPANY

S. 920 

TO AMEND SECTION 11317 OF TITLE 40, UNITED STATES CODE, 

TO IMPROVE THE TRANSPARENCY OF THE STATUS OF INFORMATION TECHNOLOGY INVESTMENTS, TO REQUIRE GREATER 

ACCOUNTABILITY FOR COST OVERRUNS ON FEDERAL INFORMATION TECHNOLOGY INVESTMENT PROJECTS, TO IMPROVE THE 

PROCESSES AGENCIES IMPLEMENT TO MANAGE INFORMATION 

TECHNOLOGY INVESTMENTS, TO REWARD EXCELLENCE IN INFORMATION TECHNOLOGY ACQUISITION, AND FOR OTHER PURPOSES 

MAY 5, 2010.—Ordered to be printed 


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(II) 

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

JOSEPH I. LIEBERMAN, Connecticut, Chairman 

CARL LEVIN, Michigan 

DANIEL K. AKAKA, Hawaii 

THOMAS R. CARPER, Delaware 

MARK L. PRYOR, Arkansas 

MARY L. LANDRIEU, Louisiana 

CLAIRE MCCASKILL, Missouri 

JON TESTER, Montana 

ROLAND W. BURRIS, Illinois 

EDWARD E. KAUFMAN, Delaware 

SUSAN M. COLLINS, Maine 

TOM COBURN, Oklahoma 

SCOTT P. BROWN, Massachusetts 

JOHN MCCAIN, Arizona 

GEORGE V. VOINOVICH, Ohio 

JOHN ENSIGN, Nevada 

LINDSEY GRAHAM, South Carolina 

MICHAEL L. ALEXANDER, Staff Director 

KEVIN J. LANDY, Chief Counsel 

ADAM R. SEDGEWICK, Professional Staff Member 

ERIC S. HOPKINS, Professional Staff Member, Subcommittee on Federal Financial 

Management, Government Information, Federal Services, and International Security 

BRANDON L. MILHORN, Minority Staff Director and Chief Counsel 

LISA M. NIEMAN, Minority Counsel 

R. JUSTIN STEVENS, Minority Professional Staff Member, Subcommittee on Federal Financial 

Management, Government Information, Federal Services, and International Security 

TRINA DRIESSNACK TYRER, Chief Clerk 


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(III) 

C O N T E N T S 

Page 

I. Purpose and Summary .................................................................................. 1 

II. Background and Need for Legislation .......................................................... 2 

III. Legislative History ......................................................................................... 4 

IV. Section-by-Section Analysis .......................................................................... 4 

V. Evaluation of Regulatory Impact .................................................................. 12 

VI. Congressional Budget Office Cost Estimate ................................................ 13 

VII. Changes in Existing Laws, as Reported ...................................................... 14 


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1GAO–08–1051T Information Technology: OMB and Agncies Need to Improve Planning, Management, and Oversight of Projects Totaling Billions of Dollars. 

Calendar No. 364 

111TH CONGRESS REPORT " ! SENATE 2d Session 111–179 

INFORMATION TECHNOLOGY (IT) INVESTMENT OVERSIGHT ENHANCEMENT AND WASTE PREVENTION ACT 

OF 2009 

MAY 5, 2010.—Ordered to be printed 

Mr. LIEBERMAN, from the Committee on Homeland Security and 

Governmental Affairs, submitted the following 

R E P O R T 

[To accompany S. 920] 

The Committee on Homeland Security and Governmental Affairs, 

to which was referred the bill (S. 920) to amend section 11317 of 

title 40, United States Code, to improve the transparency of the 

status of information technology investments, to require greater accountability for cost overruns on Federal information technology investment projects, to improve the processes agencies implement to 

manage information technology investments, to reward excellence 

in information technology acquisition, and for other purposes, having considered the same, reports favorably thereon with an amendment and recommends that the bill do pass. 

I. PURPOSE AND SUMMARY

S. 920 seeks to improve the federal government’s management of 

its information technology projects and investments. As it stands 

now, the federal government spends more than $40 billion annually 

on major IT investments, with the Government Accountability Office estimating that nearly one-half of the investments are poorly 

planned, poorly managed, or both.1

To address these problems, this bill would establish an improved 

process for agencies to manage and monitor progress of large IT investments. It would require agencies to take specific steps to show 


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sufficient planning and oversight before there is a significant investment in money; measure whether the investment is achieving 

expected cost, schedule, and performance targets; report to the Office of Management and Budget and to Congress if a project is experiencing significant problems; and terminate investments that 

fail to meet cost, schedule, and performance targets. 

II. BACKGROUND AND NEED FOR THE LEGISLATION

Since 2006, the Committee’s Subcommittee on Federal Financial 

Management, Government Information, Federal Services, and 

International Security has held several hearings on the federal government’s information technology acquisition planning and management. These hearings, along with a number of Government Accountability Office (GAO) reports, have shown that it is difficult for 

stakeholders to stay informed of major Federal IT investments, 

which total billions of dollars each year. For instance, many agencies fail to define why an investment is needed, provide incomplete 

and inaccurate planning documents for the investment, and insufficiently manage investments according to established standards and 

best practices. In addition, many project managers lack the resources and knowledge necessary to effectively plan and manage 

complex IT investments. 

This bill would establish reporting requirements to inform agency senior managers, OMB, and Congress when an investment is 

facing critical problems that could negatively impact the success of 

the project. Furthermore, the legislation is intended to give agencies help in properly planning and managing projects, so that they 

can correct unanticipated problems before a project fails. 

An example of the type of project that would have cost less and 

produced better results had this bill’s provisions been in law is the 

Census Bureau’s investment in automating the 2010 Decennial 

Census. Automation of the 2010 Decennial Census was a major acquisition project that required the purchase and management of 

systems, equipment (including handheld computers), and infrastructure for field staff to use in collecting data for the 2010 Census. The Census Bureau initially estimated it would cost $600 million for the technology necessary to automate the project. However, 

the automation project had to be significantly changed after project 

managers realized the investment was not proceeding as planned 

and would not meet its goals for cost and performance. 

In 2007, the Census Bureau determined that it would not be feasible to use the handheld computers in the non-response follow-up 

(NRFU) portion of the 2010 Decennial Census, its largest field operation, and that it would accordingly need to revert to a paperbased system. The Bureau estimated that reverting to a paperbased NRFU, but still using handheld computers for address canvassing (which determines residences to receive the Census questionnaire), would result in a cost increase of the life-cycle cost of 

the 2010 Decennial Census of between $2.2 billion and $3 billion 

in addition to the previously reported estimate of $11.5 billion. Further, the automation contract itself was renegotiated in the fall of 

2008 and is now expected to total around $790 million nearly onethird more than the original estimate. Despite this increase in contract cost, the Bureau has reverted to a paper-based NRFU and 

will be conducting some of the automation in-house, such as the 


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2Testimony before the United States House of Representatives Committee on Oversight and 

Government Reform April 9, 2008. ‘‘Progress on the development of the Field Data Collection 

automation program and the Decennial Response Integration System.’’ Accessed December 10, 

2009 at http://oversight.house.gov/images/stories/documents/20081219175944.pdft. 3 Information Technology: Agencies Need to Establish Comprehensive Policies to Address 

Changes to Projects’ Cost, Schedule, and Performance Goals, GAO–08–925 (Washington, D.C.: 

July 2008). 4 Earned Value Management Systems (ANSI/EIA 748–B), Copyright© (2007), Information 

Technology Association of America. All Rights Reserved. Reprinted by Permission. 

help desk, support, and some software development. Moving these 

functions in-house is expected to cost the Bureau $97 million. 

Had the IT Investment Oversight Enhancement and Waste Prevention Act of 2009 been enacted prior to the 2010 Decennial Census automation contract, the project would have been considered a 

core IT investment at the Census Bureau, and the project would 

have undergone an independent cost estimate for the full lifecycle 

of the project. Then, quarterly reports on the project’s cost, schedule, and performance would have been required. With these additional planning and monitoring steps in place, the Bureau likely 

would have identified these cost and performance problems in time 

to prevent some of the failures. These mistakes likely led to the 

need to pay an additional $1 billion dollars to revert the 2010 Decennial Census process to a paper-based system that will limit the 

use of the handheld computers, reduce the accuracy of the Decennial Census, and unnecessarily waste taxpayer money.2

GAO found that one of the major contributing factors to federal 

IT investment failures is that agencies continually change the 

originally planned price tag and delivery date for IT investments, 

which essentially masks overall cost, schedule, and performance 

problems.3 Under S. 920, agencies will have to measure progress 

from the original cost, schedule, and performance baselines to avoid 

situations where senior managers and Congress are limited in their 

ability to fully examine the life cycle cost of an investment. 

The bill also requires each agency, in coordination with OMB, to 

identify and report to Congress what it considers to be its core IT 

investments. Core IT investments are defined as investments that 

are a high-dollar value relative to the rest of the IT investments 

undertaken by that agency, critical to the successful mission of the 

agency, and/or incorporate technologies that may be unproven or 

not fully developed. Once core IT investment projects are identified, 

agencies must report annually to Congress on the projects’ primary 

business case and key functional requirements. The bill also requires the agency head to review the primary business case and 

core functionality requirements quarterly and notify Congress of 

any changes within 14 days of the end of each quarter. The agency 

head must also provide an interim report notifying Congress of how 

the changes will affect the cost and ultimate effectiveness of the investment. 

The bill creates two reporting thresholds that the Committee believes will help inform Congress about major IT investments that 

are experiencing serious problems. To do this, the bill uses the 

earned value management system (EVM) 4 developed by the American National Standards Institute, and used throughout the industry to manage IT investments. An EVM system is an index that 

takes into account cost, schedule, and performance of an IT project. 

In S. 920, an investment is considered to have crossed reporting 

thresholds if it: (1) ‘‘significantly deviates’’ from the original EVM 


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baseline by 20 percent, or (2) ‘‘grossly deviates’’ from the original 

EVM baseline by 40 percent. If an investment significantly deviates, then the agency head will have to report to Congress and 

GAO, providing information such as the date the deviation determination was made, the amount of the cost increases and the extent of schedule delays, as well as changes in the project’s requirements and reasonable alternatives to the investment. If a project 

grossly deviates, the agency will have to provide a more detailed 

report to Congress and GAO, conduct specific project analyses, develop a new baseline for the project, and designate the project as 

a core IT investment. 

III. LEGISLATIVE HISTORY

Senator Carper introduced S. 920 on April 28, 2009. The bill was 

read twice and referred to the Committee on Homeland Security 

and Governmental Affairs. Chairman Lieberman, Ranking Minority Member Collins and Senator Voinovich cosponsored S. 920. 

The Subcommittee on Federal Financial Management, Government Information, Federal Services, and International Security 

held a hearing on April 28, 2009, titled, ‘‘Government 2.0: 

Transitioning America into the 21st Century and a Digital Future.’’ 

The Committee received testimony from the Honorable Vivek 

Kundra, Administrator, Office of Electronic Government and Information Technology and Federal Chief Information Officer; David 

Powner, Director, Information Technology Issues, U.S. Government 

Accountability Office; The Honorable Karen Evans, former Administrator for Electronic Government and Information Technology 

(OMB); and Phillip Bond, President and Chief Executive Officer of 

TechAmerica. The witnesses focused their testimony on the need 

for agencies to be more transparent with their investments in order 

to better manage cost, schedule, and performance. In addition, the 

witnesses agreed that agencies need to better implement the principles of Earned Value Management in order to reduce the risk of 

cost overruns and schedule delays. 

The Committee considered S. 920 on May 20, 2009, adopted the 

Carper substitute amendment, and ordered the bill reported favorably, both by unanimous consent. Members present for consideration of both the substitute amendment and the bill were Chairman Lieberman; Senators, Akaka, Carper, Pryor, McCaskill, and 

Burris; Ranking Minority Member Collins; and Senators Coburn, 

and Voinovich. 

IV. SECTION-BY-SECTION ANALYSIS

Section 1. Short title 

Section 1 designates the name of the Act as the ‘‘Information 

Technology Investment Oversight Enhancement and Waste Prevention Act of 2009.’’ 

Section 2. Findings 

Section 2 states Congress’ findings with respect to Federal IT investments, including that agencies have struggled with high risk 

and complex IT investments and that Congress has historically 

been caught off-guard by IT investments that seemed like they 

were on budget, but ended up costing taxpayers hundreds of milVerDate Mar 15 2010 08:09 May 08, 2010 Jkt 056260 PO 00000 Frm 00008 Fmt 6659 Sfmt 6602 E:\HR\OC\SR179.XXX SR179

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lions of dollars more than expected. The findings also state Congress’ belief that OMB can help better inform Congress and the 

American taxpayers of the true costs and status of IT investments 

through mechanisms that provide real time project management 

information and force agencies to improve the accuracy and reliability of project management information. 

Section 3. Real-time transparency of IT investment projects 

Section 3 requires the Office of Management and Budget to establish and maintain a website that will provide accurate information on the status of all major IT investments. The website, also 

known as a ‘‘dashboard,’’ will show current and projected future 

cost, schedule, and performance information. OMB and federal 

agencies can use the website to cost-effectively satisfy the reporting 

requirements established in the bill. Congress can also use the 

website to track progress of major IT investments and identify 

when those investments may be falling behind the cost, schedule, 

and performance expectations of the project. It is the intent of the 

Committee that, based on the successful implementation of the 

website, OMB should expand the website to include information on 

other major capital investments including, but not limited to, weapons acquisitions, satellites, construction projects, and environmental cleanup. 

Section 4. IT Investments projects 

Subsection 4(a) Significant and Gross Deviations 

Section 4(a) amends Section 11317 of Title 40, United States 

Code. The section-by-section analysis (subsections a through f) 

below refers to the new Section 11317, as amended by this bill. 

Subsection (a) Definitions 

Paragraph (a)(1) defines the term ‘‘agency head’’ as the person 

within the agency primarily responsible for the information technology investment. 

Paragraph (a)(2) defines the ‘‘ANSI EIA 748 B standard’’ by cross 

referencing a standard jointly established by the American National Standards Institute and the Electronic Industries Alliance. 

That standard lays out several best practice guidelines that government project managers should follow if an investment is to be delivered within an acceptable cost and schedule. For example, the 

standard requires that project managers break investments into 

smaller, more manageable deliverables, and then, as the project 

progresses, measure whether the investment is meeting the expected deliverables. The standard is seen by project management 

experts as one of the most effective ways to manage risk and reduce cost and schedule overruns. 

Paragraph (a)(3) identifies the congressional committees to which 

the bill directs reports required under it. 

Paragraph (a)(4) states that the Chief Information Officer (CIO) 

at the Department level agency is primarily responsible for the IT 

project under review. 

Paragraph (a)(5) defines ‘‘core IT investment project’’ as an IT investment project that the CIO, with approval of the agency head, 

designates as such. The designation criteria, further detailed in 


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paragraph (b), include: the project’s criticality to the mission, highdollar value, use of unproven technologies and/or risk of a significant negative impact to the agency if the project fails, relative to 

the other major IT investments in the agency. The CIO and agency 

head are the individuals most intimately familiar with the various 

IT projects and mission of the agency, so they are in the best position to determine which projects are most critical and risky to their 

agency. Thus, the CIO and agency head are tasked with the responsibility to identity these projects. 

Paragraph (a)(6) states that the term ‘‘Director’’ refers to the Director of the Office of Management and Budget. 

Paragraph (a)(7) defines the term ‘‘Earned Value Management’’ 

(EVM) as the cost, schedule, and performance data used to determine a project’s status. The EVM for each agency’s projects must 

be developed in accordance with the ANSI EIA–748 B standard, defined above. 

Paragraph (a)(8) defines the term ‘‘grossly deviated’’ as a variance of 40 percent or more from the original cost and schedule expectations. This means that if any major IT investment project’s 

EVM cost, schedule, or performance indicators deviate 40 percent 

or more from its original baseline, the project will be considered to 

have grossly deviated, thereby triggering the remedial actions set 

forth in section (e)(3). 

Paragraph (a)(9) defines the term ‘‘independent government cost 

estimate’’ to mean an examination conducted by a third party not 

involved in the project and who provides a neutral and nonbiased 

analysis of the IT investment. The independent government cost 

estimate is intended to ensure that the agency and the contractor 

take proper steps to plan, acquire, and implement the investment 

appropriately. 

Paragraph (a)(10) defines an ‘‘IT investment project’’ as an investment that requires special management attention, requires significant agency resources, is responsible for obligating over 

$500,000 annually, or has significant program or policy implications. This definition is consistent with OMB’s definition of a major 

IT investment. However, it is the intent of the Committee that 

OMB shall develop a consistent and uniform government-wide definition of information technology that applies to investments that 

significantly incorporate information technology hardware and software such as satellites and weapons systems. 

Paragraph (a)(11) defines the term ‘‘life cycle cost’’ to mean the 

total cost of an IT investment, which encompasses planning, research and development, modernization, enhancement, operation, 

and maintenance. 

Paragraph (a)(12) defines the ‘‘original baseline’’ as the agreed 

upon cost, schedule, and performance parameters of an IT investment. The original baseline, also known as a performance measurement baseline or PMB should be developed at the beginning of the 

project, using EVM standards and approved by OMB. This original 

baseline shall be used through the course of the project, unless 

there is a gross deviation. Following a gross deviation, a new EVM 

baseline (also known as a rebaseline) must be established, as required for remedial action in section (e)(3). This new EVM baseline 

will, once established after a gross deviation, be considered an 

original baseline. 


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Paragraph (a)(13) defines ‘‘significantly deviated’’ as an EVM 

variance that is at least 20 percent from the original baseline. This 

means that if any major IT investment project’s EVM cost, schedule, or performance indicators deviate 20 percent or more from its 

original baseline, the project will be considered to have significantly deviated, thereby triggering the remedial actions set forth in 

section (d)(2). 

Subsection (b). Core IT Investment Projects Designation 

Subsection (b) requires the CIO, with approval from the agency 

head, to designate those IT investment projects that are most critical to the agency’s mission as ‘‘core IT investment projects.’’ The 

designation may be based on whether the IT investment represents 

a higher dollar value relative to the rest of the portfolio, is critical 

to the successful mission of the agency, incorporates unproven or 

undeveloped technology, or whether the project would have a significant negative impact on the successful completion of the agency 

mission if the project experienced significant cost, schedule, or performance deviations. 

Subsection (c). Cost, Schedule, and Performance Reports 

Subsection (c) designates the reporting requirements for agencies 

on all IT investments. The bill requires that the project manager 

for the investment must submit, within 14 calendar days after each 

fiscal quarter, a descriptive report to the CIO. This report should 

include the current cost, schedule, and performance for all projects 

under the project manager’s supervision; a description of the original cost, schedule, and performance benchmarks for the investment; any variance in the cost, schedule, or performance of the investment since the commencement of the project; and a declaration 

of any known, expected, or anticipated changes to the original or 

current baseline description. However, if a project manager determines that an IT investment has deviated according to definitions 

established in paragraph (a)(8) and paragraph (a)(13) before the 

end of the fiscal quarter, then the project manager must within 14 

days of the determination submit a descriptive report including the 

same information to the CIO. 

Subsection (d). Determination of Significant Deviation 

Subsection (d) requires CIOs to report to Congress any major IT 

investments which have ‘‘significantly deviated,’’ as defined in 

paragraph (a)(13). A CIO makes this determination based on a report from the project manager as described in subsection (c). Upon 

the significant deviation determination, the CIO must notify the 

agency head and issue a report to Congress and GAO, which includes the date the CIO determined the project deviated; the 

amount of the cost increase and schedule delay for delivery; any 

change in requirements from the original contract; the reason for 

the differences between the project manager’s, contractor’s, and any 

independent analysis estimated cost for the investment; the reasons why the investment has deviated from cost, schedule or performance benchmarks; and a summary of the plan of action to correct the deviation. The agency head must submit this report to 

Congress and GAO within 21 calendar days after the determination of a significant deviation. 


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Subsection (e). Determination of Gross Deviation 

Subsection (e) requires CIOs to submit a report described in subsection (c) to Congress upon the project manager’s determination 

that the IT investment has grossly deviated, as defined in paragraph (a)(8). If the project has not been previously reported as 

grossly deviated then the agency head must submit a report to 

Congress that includes the date the CIO determined the investment had grossly deviated; whether the project was previously reported as significantly deviated under subsection (d) or grossly deviated under this subsection; incorporation of all previous reports 

to Congress on the investment by reference; updated information 

as required under subsection (d); and a comprehensive plan of action to remedy the gross deviation with milestones to control future 

cost, schedule, and performance deviations in the future. In addition, the agency head must submit to Congress a report that describes the primary business case and key functional requirements 

of the investment; any portions of the investment that may be feasibly procured under a fixed-price contract; a certification by the 

agency head that all technical requirements have been reviewed 

and are aligned with the primary business case; a description of 

any changes to the primary business case or functional requirements since the project’s inception; and an independent cost estimate by an entity approved by OMB. The agency must also submit 

to Congress an analysis of the business goals that the project was 

originally designed to address; an analysis of what project 

deliverables remain to be completed to achieve the business goals 

defined; the three most cost-effective alternative approaches to 

achieve the business goals defined; a cost-benefit analysis that compares the three most cost-effective alternative approaches with the 

current investment; and a cost-benefit analysis of termination of 

the project without choosing any of the three alternative approaches; a new cost, schedule, and performance baseline that is 

consistent with the independent government cost estimate; and a 

designation by the agency that the project is considered a core IT 

investment under subsection (b). 

The agency head must report the information required under this 

subsection to Congress within 45 calendar days after the end of the 

fiscal quarter or interim determination and ensure the completion 

of the remedial actions as reported by the agency within 180 calendar days. If the agency head fails to complete the remedial action 

within 180 calendar days, then additional funds may not be spent 

on the investment. 

The bill allows an exception to the reporting and analyses requirements, which states that the CIO, in coordination with the 

agency head and OMB Director, may forgo completion of any element of a report or analysis if it is determined that those elements 

are not relevant to the understanding of the difficulties facing the 

project or further continuation of the project in a timely and costefficient manner. If the CIO chooses to forgo such reporting or 

analysis, the CIO must explain to Congress the basis for the CIO’s 

decision to exclude any element of the report or analysis not provided. The purpose of allowing for such an exception is so that if 

an element of the reporting or analyses required under this section 

does not pertain to the IT investment project that has deviated 

and/or whose inclusion would not be beneficial in bringing the 


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project back on track, the agency does not have to conduct work to 

provide irrelevant information to Congress. The requirement that 

the CIO must provide the basis for not including any omitted element is intended to ensure that the CIO can sufficiently explain 

why the information would not be pertinent. 

Subsection (f). Additional Requirements for Core IT Investment Project Reports 

Subsection (f) outlines additional planning requirements for 

those IT projects designated as core IT investments by the agency 

head. First, this section requires that an IT project identified as 

grossly deviated under subsection (e) must be designated as a core 

IT project, as defined under subsection (b) in the next budget submission. In addition, those IT investments that are listed as core 

IT investments must be tracked by the agency head on a quarterly 

basis. The bill would require the agency head to notify Congress 

within 14 days following the end of the fiscal quarter if there are 

any changes to the primary business case or key functional requirements and explain the changes and impact the changes will have 

on the cost and ultimate effectiveness of the project. Further, if the 

CIO determines the core IT investment would have deviated as defined under subsection (a) without a change in the primary business case or key functional requirements, then the agency head 

must fulfill and submit the requirements under subsection (d) or 

subsection (e) depending on the deviation. 

Subsection 4(b). Inclusion in the Budget Submitted to Congress 

Subsection 4(b) requires agencies to include the reports designated under subsection (f) of Section 11317 of Title 40, as amended by this bill, in their annual budget submissions to Congress. 

Subsection 4(c). Improvement of Information Technology Acquisition and Development 

Section 4(c) amends Section 11319 of Title 40, United States 

Code. The section-by-section analysis below refers to the new Section 11319, as amended by this bill. 

Subsection (a). Purpose 

Subsection (a) explains the purposes of the section. The purposes 

are that agencies will meaningfully examine current internal processes used to plan, manage, and deliver IT investments and consistently improve delivery of superior IT products and services on 

time and within budget. 

Subsection (b). OMB Guidance 

Subsection (b) requires OMB to develop and oversee the implementation of guidance established under this section within 180 

calendar days of enactment of this bill. It is the intent of the Committee that OMB will, to the extent possible, ensure agency programs are consistent government wide, but will allow agencies 

enough flexibility to tailor programs to ensure success. 


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Subsection (c). Establishment of Program 

Subsection (c) requires each CIO, upon approval of the agency 

head, to establish a program to improve IT processes within 120 

calendar days of enactment. 

Subsection (d). Program Requirements 

Subsection (d) specifies the requirements of the program mandated by subsection (c). The Committee expects that if agencies 

have not already done so, they will establish and continually update a documented process for IT acquisition planning, requirements development and management, project management and 

oversight, earned-value management, and risk management. Further, this subsection requires agencies to develop metrics that can 

be monitored in near real-time through an easy to understand 

‘‘dashboard,’’ consistent with the goals of Section 3 of this bill, appropriate for project management and that appropriately monitor 

the process and development status of IT investments, and achievement of stated program and investment outcomes. In addition, the 

subsection recognizes that there is a government-wide workforce 

shortage of key personnel required to manage highly complex IT investments. Therefore, the subsection requires agencies to develop a 

process to ensure that key program personnel have the appropriate 

level of experience, training, and education from an institute recognized by the Director of OMB. Lastly, the subsection requires that 

agencies develop an appropriate and effective process for CIOs to 

intervene and stop funding of an IT investment if the project is at 

risk of not achieving its major milestones. It is the expectation of 

the Committee that agencies will give CIOs clear and direct authority to intervene or stop funding at any point in the process of 

planning, managing, and delivering an IT investment. 

Subsection (e). Annual Report to OMB 

Subsection (e) requires agency heads to submit an annual report 

to OMB. The report must include, among other elements, a detailed 

summary of the program’s accomplishments, the status of implementation, and the metrics used to determine the program’s success. 

Subsection (f). Annual Report to Congress 

Subsection (f) establishes reporting requirements for OMB and 

Congress to ensure agencies are appropriately and efficiently implementing subsection (d). 

Section 5. Major Automated Information System Programs 

Subsection 5(a). Definitions 

Subparagraph 5(a)(1) amends the section heading of Section 

2445a of title 10 of the U.S. Code to read ‘‘Section 2445a. Definitions.’’ 

Subparagraph 5(a)(2) and Subparagraph 5(a)(3) make technical 

corrections to Title 10 of the U.S. Code that harmonize, to the extent possible, the definitions and requirements established by S. 

920 for civilian agencies with those requirements under Title 10 of 

the U.S. Code for the Department of Defense. These subparagraphs 

also ensure that the CIO continues to be the Department lead for 


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overseeing IT investments, avoiding duplicative efforts, preventing 

capability gaps, and ensuring that older and newer systems are 

compatible and interoperable. 

For example, Subparagraphs 5(a)(3) requires the Department of 

Defense to track IT investments with an appropriate EVM project 

management system that shows accurate and reliable cost, schedule, and performance information. If DOD finds that investments 

deviate by 15 to 25 percent from the established baseline based on 

the EVM system, then DOD will be required to include information 

on troubled projects similar to civilian agencies as required under 

section 4. 

Subsection 5(b). Cost, Schedule, and Performance Information 

Subsection 5(b) mirrors subsection 4 and enhances current Title 

10 significant and critical change planning and reporting requirements for the Department of Defense to make them consistent with 

requirements S. 920 establishes for civilian agencies. 

Section 6. IT SWAT 

Subsection 6(a) establishes the purpose of the IT SWAT (Significant Waste Avoidance Team) as providing a resource to assist 

agencies in avoiding deviations as defined in subsection 4(a) of the 

bill. 

Subsection 6(b) directs the E-Government Administrator to establish the IT SWAT within 180 calendar days after the enactment 

of the act to carry out subsection 4(a). The individuals on the IT 

SWAT shall be highly trained and experienced program managers 

who are trained to the Senior/Expert level according to the Federal 

Acquisition Certification for Program and Project Managers, or who 

have comparable education, certification, training, and experience 

to successfully manage high-risk IT investment projects. The OMB 

Director will determine the number of individuals who serve on 

each IT SWAT. 

Subsection 6(c) requires OMB to identify consultants outside of 

government who have expert knowledge in IT program and risk 

management. If OMB decides that a team of IT experts is needed, 

OMB can hire on a limited-time basis consultants from the private 

sector. However, the number of consultants that are hired from the 

private sector cannot equal more than 20 percent of any IT SWAT. 

The remaining 80 percent of the IT SWAT members must be federal government employees. Further, consultants that have an established relationship with an organization that is under review 

may not participate in the assessment. This subsection gives the EGovernment Administrator the ability to enter into competitively 

bid contracts with one or more qualified consultants. 

Subsection 6(d) requires the E-Government Administrator to determine whether an IT investment may deviate as defined in Section 4 of the bill. If a project is reasonably suspected to deviate in 

the future or lacks information that will allow the E-Government 

Administrator to accurately assess the investment, then the section 

directs OMB to recommend the assignment of one or more members from the IT SWAT to assess the project. The costs for the assessment would be paid for by the IT investment project being asVerDate Mar 15 2010 08:09 May 08, 2010 Jkt 056260 PO 00000 Frm 00015 Fmt 6659 Sfmt 6602 E:\HR\OC\SR179.XXX SR179

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sessed. The E-Government Administrator shall monitor the 

progress being made by the IT SWAT. 

Subsection 6(e) requires the E-Government Administrator to recommend that the agency head take steps to reduce and avoid any 

deviations in cost, schedule, and performance if potential problems 

are found during the assessment under subsection 6(d). The E-Government Administrator can recommend that the agency provide 

training or mentoring to improve the qualifications of the program 

manager; replace the program manager or other staff; supplement 

the program manager with highly qualified federal government employees or independent contractors; terminate the IT investment; or 

hire an independent contractor to report directly to senior management and the E-Government Administrator. 

Subsection 6(f) allows the OMB E-Government Administrator to 

reprogram amounts within an agency to pay for an assessment 

under subsection 6(d) and to notify the Congressional committees 

on appropriations of any such reprogramming. 

Subsection 6(g) requires the Director of OMB to include in the 

annual E-Government report a detailed summary of the composition and activities of the IT SWAT, including the number and 

qualifications of individuals on the IT SWAT; a description of the 

IT investment projects that the IT SWAT assessed and worked on 

during the previous fiscal year; the major issues that necessitated 

the involvement of the IT SWAT and whether the issues were resolved; whether or not issues were resolved and any plans the 

agency head has to resolve these issues; a breakdown of the 

sources and amounts OMB and federal agencies spent to support 

the activities of the IT SWAT; and a determination of whether the 

IT SWAT was effective in reducing the number of IT investment 

projects that deviate as defined in Section 4. 

Section 7. Awards for Personnel for Excellence in the Acquisition of 

Information System and Information Technology 

Subsection 7(a) requires the Director of the Office of Personnel 

Management to develop policy and guidance for agencies to recognize excellent performance by federal government employees or 

teams of federal government employees in acquisition of IT systems. 

Subsection 7(b) requires that any award program developed 

under subsection 7(a) should use, to the extent practical, objective 

outcome performance measures and include procedures for individuals to be nominated and evaluated. 

Subsection 7(c) allows the Director of the Office of Personnel 

Management and Director of Office of Management and Budget to 

develop guidance policy to provide rewards for federal government 

employees who receive recognition under subsection 7(b). 

V. EVALUATION OF REGULATORY IMPACT

Pursuant to the requirement of paragraph 11(b)(1) of rule XXVI 

of the Standing Rules of the Senate the Committee has considered 

the regulatory impact of this bill. CBO states that there are no 

intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and no costs on State, local, or tribal 

governments. The legislation contains no other regulatory impact. 


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VI. CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

JUNE 26, 2009. 

Hon. JOSEPH I. LIEBERMAN, Chairman, 

Committee on Homeland Security and Governmental Affairs, U.S. 

Senate, Washington, DC. 

Dear Mr. Chairman: The Congressional Budget Office has prepared the enclosed cost estimate for S. 920, the Information Technology (IT) Investment Oversight Enhancement and Waste Prevention Act of 2009. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Matthew Pickford. 

Sincerely, 

DOUGLAS W. ELMENDORF. 

Enclosure. 

S. 920—Information Technology (IT) Investment Oversight Enhancement and Waste Prevention Act of 2009 

S. 920 would amend federal law regarding the oversight of 

project plans for information technology (IT) systems. The legislation would require chief information officers to identify critical IT 

projects and would subject each IT project to additional reporting, 

planning, and monitoring requirements, including corrective actions for projects that fail to meet applicable standards. In addition, the legislation would establish a group of information technology experts, administered by the Office of Management and 

Budget (OMB), to respond to problems with IT projects. Finally, S. 

920 would authorize agencies to provide awards (including cash) to 

federal employees for excellence in IT acquisition, subject to the 

availability of appropriated funds. 

CBO estimates that implementing S. 920 would cost about $30 

million per year, or $150 million over the 2010–2014 period, primarily for the additional reporting requirements, subject to the 

availability of appropriated funds. The bill would have no effect on 

direct spending or revenues. 

Most of the provisions of S. 920 would expand the current practices of the federal government. Under the Clinger-Cohen Act of 

1996, agencies are required to analyze, track, and evaluate the 

risks and results of major capital investments in IT systems. To accomplish this, OMB uses a Management Watch List to monitor and 

plan agencies’ IT investments. OMB also evaluates each agency’s 

capability to manage its investments. 

Based on information from OMB and various agencies, CBO expects that complying with the reporting provisions of S. 920 would 

increase the administrative expenses of most federal agencies, but 

because of the large number of agencies and computer systems involved, we cannot precisely estimate the likely total costs. According to the Government Accountability Office (GAO), about $71 billion will be spent on IT projects by the federal government in 2009. 

In addition, GAO has reported that OMB and federal agencies have 

identified more than 400 IT projects—costing $25.2 billion in 

2008—as being poorly planned, poorly performing, or both. CBO expects that the legislation would require additional quarterly status 

reports and detailed corrective action plans for a significant number of those troubled IT projects. We estimate that implementing 


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the bill would increase the cost of such projects by a total of $25 

million a year over the 2010–2014 period. 

Reporting costs over the 2010–2014 period would generally come 

from agencies’ salary and expense budgets. In addition, there could 

be additional costs to implement and deploy the IT response group 

and to provide for awards to IT employees. Those costs also would 

be subject to the availability of appropriated funds, and we estimate that they would total around $5 million a year, depending on 

the number of employees deployed or awarded. 

S. 920 contains no intergovernmental or private-sector mandates 

as defined in the Unfunded Mandates Reform Act and would not 

affect the budgets of state, local, or tribal governments. 

The CBO staff contact for this estimate is Matthew Pickford. The 

estimate was approved by Peter H. Fontaine, Assistant Director for 

Budget Analysis. 

VII. CHANGES IN EXISTING LAWS, AS REPORTED

In compliance with paragraph 12 of rule XXVI of the Standing 

Rules of the Senate, the following changes in existing law made by 

the bill, as reported, are shown as follows: (existing law proposed 

to be omitted is enclosed in øblack brackets¿, new matter is printed 

in italic, existing law in which no change is proposed is shown in 

roman): 

UNITED STATES CODE 

* * * * * * * 

TITLE 10—ARMED 

* * * * * * * 

Subtitle A—General Military Law 

* * * * * * * 

PART IV—SERVICE SUPPLY, AND PROCUREMENT 

* * * * * * * 

CHAPTER 144A—MAJOR AUTOMATED INFORMATION 

SYSTEM PROGRAMS 

* * * * * * * 

§ 2445a. Definitions 

(a) MAJOR AUTOMATED INFORMATION SYSTEM PROGRAM.—In this 

chapter ø10 USCS §§ 2445a et seq.¿, the term ‘‘major automated information system program’’ means a Department of Defense program for the acquisition of an automated information system (either as a product or a service) if— 

(1) the program is designated by the Secretary of Defense, or 

a designee of the Secretary, as a major automated information 

system program; øor¿ 

(2) the dollar value of the program is estimated to exceed— 


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(A) $32,000,000 in fiscal year 2000 constant dollars for 

all program costs in a single fiscal year; (B) $126,000,000 in fiscal year 2000 constant dollars for 

all program acquisition costs for the entire program; or (C) $378,000,000 in fiscal year 2000 constant dollars for 

the total life-cycle costs of the program (including operation and maintenance costs)ø.¿; or 

(3) the Chief Information Officer, with the approval of the 

Secretary of Defense, determines that the program— (A) delivers a capability critical to the successful completion of the mission of the Department of Defense, or a portion of such mission; 

(B) incorporates unproven or previously undeveloped 

technology to meet primary program technical requirements; or 

(C) would have a significant negative impact on the successful completion of the mission of the Department of Defense if the program experienced significant cost, schedule, 

or performance deviations. (b) ADJUSTMENT.—The Secretary of Defense may adjust the 

amounts (and base fiscal year) set forth in subsection (a) on the 

basis of Department of Defense escalation rates. An adjustment 

under this subsection shall be effective after the Secretary transmits a written notification of the adjustment to the congressional 

defense committees. 

(c) INCREMENTS.—In the event any increment of a major automated information system program separately meets the requirements for treatment as a major automated information system program, the provisions of this chapter ø10 USCS §§ 2445a et seq.¿ 

shall apply to such increment as well as to the overall major automated information system program of which such increment is a 

part. 

(d) OTHER MAJOR INFORMATION TECHNOLOGY INVESTMENT PRO- GRAM.—In this chapter, the term ‘‘other major information technology investment program’’ means the following: 

(1) An investment that is designated by the Secretary of Defense, or a designee of the Secretary, as a ‘‘pre-Major Automated Information System’’ or ‘‘pre-MAIS’’ program. 

(2) Any other investment in automated information system 

products or services that is expected to exceed the thresholds 

established in subsection (a), as adjusted under subsection (b), 

but is not considered to be a major automated information system program because a formal acquisition decision has not yet 

been made with respect to such investment. 

(e) DEFINITIONS.—In this chapter: 

(1) CHIEF INFORMATION OFFICER.—The term ‘‘Chief Information Officer’’ means the Chief Information Officer of the Department of Defense, designated under section 3506(a)(2) of title 44. 

(2) EARNED VALUE MANAGEMENT.—The term ‘‘Earned Value 

Management’’ means the cost, performance, and schedule data 

used to determine the status of a major automated information 

system program that has been developed in accordance with the 

ANSI EIA–748–B Standard. 

(3) INDEPENDENT GOVERNMENT COST ASSESSMENT.—The term 

‘‘independent government cost assessment’’ means a pragmatic 


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and neutral analysis, assessment, and quantification of all 

costs and risks associated with a major automated information 

system program developed and submitted by the Director of 

Independent Cost Assessment. 

§ 2445b. Cost, schedule, and performance information 

(a) SUBMITTAL OF COST, SCHEDULE, AND PERFORMANCE INFORMA- TION.—The Secretary of Defense shall submit to øCongress¿ the Office of Management and Budget, the Government Accountability Office, the Committee on Homeland Security and Governmental Affairs of the Senate, and the Committee on Oversight and Government Reform of the House of Representatives each calendar year, 

not later than 45 days after the President submits to Congress the 

budget for a fiscal year under section 1105 of title 31 ø31 USCS 

§ 1105¿, budget justification documents regarding cost, schedule, 

and performance for each major automated information system program and each other major information technology investment program for which funds are requested by the President in the budget. 

(b) ELEMENTS REGARDING MAJOR AUTOMATED INFORMATION SYS- TEM PROGRAMS.—The documents submitted under subsection (a) 

with respect to a major automated information system program 

shall include detailed and summarized information with respect to 

the automated information system to be acquired under the program, and shall specifically include each of the following: 

(1) The development schedule, including major milestones. 

(2) The implementation schedule, including estimates of 

milestone dates, initial operational capability, and full operational capability. 

(3) Estimates of development costs and full life-cycle costs. 

(4) A summary of key performance parameters. 

(5) A description of the primary business case and key functional requirements for the program, including an analysis of 

alternatives. 

(6) An identification and description of any portions of the 

program that have technical requirements of sufficient clarity 

that such portions may be feasibly procured under firm, fixedprice contracts. 

(7) An independent government cost assessment for the project 

provided by the Director of Independent Cost Assessment. 

(8) Certification by the Chief Information Officer that all 

technical and business requirements have been reviewed and 

validated to ensure alignment with the reported business case. 

(9) Any changes to the primary business case or key functional requirements which have occurred since the inception of 

the program. 

(c) BASELINE.— 

(1) For purposes of this chapter ø10 USCS §§ 2445a et seq.¿, 

the initial submittal øto Congress¿ of the documents required 

by subsection (a) with respect to a major automated information system program shall constitute the original estimate or 

information originally submitted on such program for purposes 

of the reports and determinations on program changes in section 2445c of this title. 

(2) An adjustment or revision of the original estimate or information originally submitted on a program may be treated as 


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the original estimate or information originally submitted on 

the program if the adjustment or revision is the result of a critical change in the program covered by section 2445c(d) of this 

title ø10 USCS § 2445c(d)¿. 

(3) In the event of an adjustment or revision to the original 

estimate or information originally submitted on a program 

under paragraph (2), the Secretary of Defense shall include in 

the next budget justification documents submitted under subsection (a) after such adjustment or revision a notification to 

the Office of Management and Budget, the Government Accountability Office, the Committee on Armed Services of the 

Senate, the Committee on Armed Services of the House of Representatives, the Committee on Homeland Security and Governmental Affairs of the Senate, and the Committee on Oversight 

and Government Reform of the House of Representatives øthe 

congressional defense committees¿ of such adjustment or revision, together with the reasons for such adjustment or revision. 

(d) ELEMENTS REGARDING OTHER MAJOR INFORMATION TECHNOLOGY INVESTMENT PROGRAMS.—With respect to each other major 

information technology investment program, the information required by subsection (a) may be provided in the format that is most 

appropriate to the current status of the program. 

§ 2445c. Reports: quarterly reports; reports on program 

changes 

(a) QUARTERLY REPORTS BY PROGRAM MANAGERS.—The program 

manager of a major automated information system program or 

other major information technology investment program shall, on a 

quarterly basis, submit to the senior Department of Defense official 

responsible for the program a written report øidentifying¿ that— 

(1) identifies any variance in the projected development 

schedule, implementation schedule, life-cycle costs, or key performance parameters for the major automated information system or information technology investment to be acquired under 

the program from such information as originally submitted øto 

Congress¿ under section 2445b of this title ø10 USCS 

§ 2445b¿;ø.¿ 

(2) describes the cost, schedule, and performance of all programs under the program manager’s supervision; 

(3) provides the original and current program cost, schedule, 

and performance benchmarks for each program under the program manager’s supervision; 

(4) for each program under the program manager’s supervision, any known, expected, or anticipated changes to program 

schedule milestones or program performance benchmarks included as part of the original or current baseline description. 

(b) SENIOR OFFICIALS RESPONSIBLE FOR PROGRAMS.—For purposes of this section, the senior Department of Defense official responsible for a major automated information system program or 

other major information technology investment program is— 

(1) in the case of an automated information system or information technology investment to be acquired for a military department, the senior acquisition executive for the military department; or 


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(2) in the case of any other automated information system or 

information technology investment to be acquired for the Department of Defense or any component of the Department of 

Defense, the Under Secretary of Defense for Acquisition, Technology, and Logistics. 

(c) REPORT ON SIGNIFICANT CHANGES IN PROGRAM.— 

(1) IN GENERAL.—If, based on a quarterly report submitted 

by the program manager of a major automated information 

system program pursuant to subsection (a), the senior Department of Defense official responsible for the program makes a 

determination described in paragraph (2), the official shall, not 

later than 45 days after receiving such report, notify øthe congressional defense committees¿ the Office of Management and 

Budget, the Government Accountability Office, the Committee 

on Armed Services of the Senate, the Committee on Armed Services of the House of Representatives, the Committee on Homeland Security and Governmental Affairs of the Senate, and the 

Committee on Oversight and Government Reform of the House 

of Representatives in writing of such determination. 

(2) COVERED DETERMINATION.—A determination described in 

this paragraph with respect to a major automated information 

system program is a determination that— 

(A) there has been a schedule change that will cause a 

delay of more than six months but less than a year in any 

program schedule milestone or significant event from the 

schedule originally submitted øto Congress¿ under paragraph (1) or (2) of section 2445b(b) of this title ø10 USCS 

§ 2445b(b)¿; 

(B) the estimated program development cost or full lifecycle cost for the program has increased by at least 15 percent, but less than 25 percent, over the original estimate 

submitted øto Congress¿ under paragraph (3) of section 

2445b(b) of this title ø10 USCS § 2445b(b)¿; øor¿ 

(C) there has been a significant, adverse change in the 

expected performance of the major automated information 

system to be acquired under the program from the parameters originally submitted øto Congress¿ under paragraph 

(4) of section 2445b(b) of this title ø10 USCS § 2445b(b)¿; 

or ø.¿ 

(D) the Earned Value Management of the program has 

changed by at least 15 percent, but less than 25 percent. 

(3) NOTIFICATION REQUIREMENTS.—The notification required under paragraph (1) shall include— 

(A) the date on which the determination described in 

paragraph (2) was made; 

(B) the amount of the cost increases and the extent of the 

schedule delays with respect to such program; 

(C) any requirements that— 

(i) were added subsequent to the original contract; or 

(ii) were part of the original contract, but were 

changed by deferment or deletion from the original 

schedule, or were otherwise no longer included in the 

contract; 

(D) an explanation of the differences between— 


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(i) the estimate at completion between the program 

manager, any contract, and any independent analysis 

and 

(ii) the original budget at completion; 

(E) a statement of the reasons underlying the program’s 

significant changes; and 

(F) a summary of the plan of action to remedy the significant changes. 

(4) ALTERNATIVE SIGNIFICANT CHANGES DETERMINATION.—If 

the program manager determines, subsequent to a change in the 

primary business case or key functional requirements, that 

without such change the program would undergo significant 

changes— 

(A) the program manager shall notify the Secretary of 

Defense of the significant changes; and 

(B) the Secretary of Defense shall notify the congressional 

defense committees in accordance with the requirements of 

this subsection. 

(d) REPORT ON CRITICAL CHANGES IN PROGRAM.— (1) IN GENERAL.—If, based on a quarterly report submitted 

by the program manager of a major automated information 

system program or other major information technology investment program pursuant to subsection (a), the senior Department of Defense official responsible for the program makes a 

determination described in paragraph (2), the official shall, not 

later than 60 days after receiving such report— 

(A) carry out an evaluation of the program under subsection (e); and 

(B) submit, through the Secretary of Defense, to øthe 

congressional defense committees¿ the Office of Management and Budget, the Government Accountability Office, 

the Committee on Armed Services of the Senate, the Committee on Armed Services of the House of Representatives, 

the Committee on Homeland Security and Governmental 

Affairs of the Senate, and the Committee on Oversight and 

Government Reform of the House of Representatives a report meeting the requirements of subsection (f). 

(2) COVERED DETERMINATION.—A determination described in 

this paragraph with respect to a major automated information 

system program or other major information technology investment program is a determination that— 

(A) the automated information system or information 

technology investment failed to achieve initial operational 

capability within five years after funds were first obligated 

for the program; 

(B) there has been a schedule change that will cause a 

delay of one year or more in any program schedule milestone or significant event from the schedule originally submitted øto Congress¿ under paragraph (1) or (2) of section 

2445b(b) of this title ø10 USCS § 2445b(b)¿ or section 

2445b(d) of this title ø10 USCS § 2445b(d)¿, as applicable; 

(C) the estimated program development cost or full lifecycle cost for the program has increased by 25 percent or 

more over the original estimate submitted øto Congress¿ 

under paragraph (3) of section 2445b(b) of this title ø10 


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USCS § 2445b(b)¿ or section 2445b(d) of this title ø10 

USCS § 2445b(d)¿, as applicable ø; or¿ 

(D) there has been a change in the expected performance 

of the major automated information system or major information technology investment to be acquired under the 

program that will undermine the ability of the system to 

perform the functions anticipated at the time information 

on the program was originally submitted øto Congress¿ 

under section 2445b(b) of this title ø10 USCS § 2445b(b)¿ 

or section 2445b(d) of this title ø10 USCS § 2445b(d)¿, as 

applicable; or ø.¿ 

(E) the Earned Value Management of the program has 

changed by at least 25 percent. 

(3) ALTERNATIVE CRITICAL CHANGES DETERMINATION.—If the 

program manager determines, subsequent to a change in the 

primary business case or key functional requirements, that 

without such change the program would undergo critical 

changes— 

(A) the program manager shall notify the Secretary of 

Defense of the critical changes; and 

(B) the Secretary of Defense shall fulfill the requirements 

described in subparagraphs (A) and (B) of paragraph (1). 

(e) PROGRAM EVALUATION.—The evaluation of a major automated 

information system program or other major information technology 

investment program conducted under this subsection for purposes 

of subsection (d)(1)(A) shall include an assessment of— 

(1) the projected schedule and an independent government 

cost assessment provided by the Director of Independent Cost 

Assessment øcost and schedule¿ for completing the program if 

current requirements are not modified; 

(2) the projected schedule and an independent government 

cost assessment provided by the Director of Independent Cost 

Assessment øcost and schedule ¿for completing the program 

based on reasonable modification of such requirements; and 

(3) the rough order of magnitude of the cost and schedule for 

any reasonable alternative system or capability. 

(f) REPORT ON CRITICAL PROGRAM CHANGES.—A report on a 

major automated information system program or other major information technology investment program conducted under this subsection for purposes of subsection (d)(1)(B) shall include—øinclude 

a written certification¿ 

(1) a written certification (with supporting explanation) stating that— 

(A) ø(1)¿ the automated information system or information technology investment to be acquired under the program is essential to the national security or to the efficient 

management of the Department of Defense; 

(B) ø(2)¿ there is no alternative to the system or information technology investment which will provide equal or 

greater capability at less cost; 

(C) ø(3)¿ the new estimates of the costs, schedule, and 

performance parameters with respect to the program and 

system or information technology investment, as applicable, have been determined, with the concurrence of the DiVerDate Mar 15 2010 08:09 May 08, 2010 Jkt 056260 PO 00000 Frm 00024 Fmt 6659 Sfmt 6602 E:\HR\OC\SR179.XXX SR179

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rector of Cost Assessment and Program Evaluation, to be 

reasonable; and 

(D) ø(4)¿ the management structure for the program is 

adequate to manage and control program costs; and ø.¿ 

(E) all technical and business requirements have been reviewed and validated to ensure alignment with the reported 

business case; and 

(2) a description of— 

(A) the primary business case and key functional requirements for the program, including an analysis of alternatives; 

(B) any portions of the program that have technical requirements of sufficient clarity that such portions may be 

feasibly procured under firm, fixed-price type contract; and 

(C) any changes to the primary business case or key functional requirements which have occurred since the inception 

of the program. 

(g) PROHIBITION ON OBLIGATION OF FUNDS.— 

(1) If the determination of a critical change to a program is 

made by the senior Department official responsible for the program under subsection (d)(2) and a report is not submitted to 

Congress within the 60-day period provided by subsection 

(d)(1), appropriated funds may not be obligated for any major 

contract under the program. 

(2) The prohibition on the obligation of funds for a program 

under paragraph (1) shall cease to apply on the date on which 

Congress has received a report in compliance with the requirements of subsection (d)(2). 

* * * * * * * 

TITLE 31—MONEY AND FINANCE 

* * * * * * * 

Subtitle II—The Budget Process 

* * * * * * * 

CHAPTER 11—THE BUDGET AND FISCAL, BUDGET, AND 

PROGRAM INFORMATION 

* * * * * * * 

§ 1105. Budget contents and submission to Congress 

(a) On or after the first Monday in January but not later than 

the first Monday in February of each year, the President shall submit a budget of the United States Government for the following fiscal year. Each budget shall include a budget message and summary and supporting information. The President shall øinclude in 

each budget the following¿ include in each budget— 

(1) information on activities and functions of the 

Governmentø.¿; 

(2) when practicable, information on costs and achievements 

of Government programsø.¿; 

(3) other desirable classifications of informationø.¿; 


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(4) a reconciliation of the summary information on expenditures with proposed appropriationsø.¿; 

(5) except as provided in subsection (b) of this section, estimated expenditures and proposed appropriations the President 

decides are necessary to support the Government in the fiscal 

year for which the budget is submitted and the 4 fiscal years 

after that yearø.¿; 

(6) estimated receipts of the Government in the fiscal year 

for which the budget is submitted and the 4 fiscal years after 

that year under— 

(A) laws in effect when the budget is submitted; and 

(B) proposals in the budget to increase revenuesø.¿; 

(7) appropriations, expenditures, and receipts of the Government in the prior fiscal yearø.¿; 

(8) estimated expenditures and receipts, and appropriations 

and proposed appropriations, of the Government for the current fiscal yearø.¿; 

(9) balanced statements of the— 

(A) condition of the Treasury at the end of the prior fiscal year; 

(B) estimated condition of the Treasury at the end of the 

current fiscal year; and 

(C) estimated condition of the Treasury at the end of the 

fiscal year for which the budget is submitted if financial 

proposals in the budget are adoptedø.¿; 

(10) essential information about the debt of the 

Governmentø.¿; 

(11) other financial information the President decides is desirable to explain in practicable detail the financial condition 

of the Governmentø.¿; 

(12) for each proposal in the budget for legislation that would 

establish or expand a Government activity or function, a table 

showing— 

(A) the amount proposed in the budget for appropriation 

and for expenditure because of the proposal in the fiscal 

year for which the budget is submitted; and 

(B) the estimated appropriation required because of the 

proposal for each of the 4 fiscal years after that year that 

the proposal will be in effectø.¿; 

(13) an allowance for additional estimated expenditures and 

proposed appropriations for the fiscal year for which the budget is submittedø.¿; 

(14) an allowance for unanticipated uncontrollable expenditures for that yearø.¿; 

(15) a separate statement on each of the items referred to in 

section 301(a)(1)(5) of the Congressional Budget Act of 1974 (2 

U.S.C. 632(a)(1)(5))ø.¿; 

(16) the level of tax expenditures under existing law in the 

tax expenditures budget (as defined in section 3(a)(3) of the 

Congressional Budget Act of 1974 (2 U.S.C. 622(a)(3)) for the 

fiscal year for which the budget is submitted, considering projected economic factors and changes in the existing levels 

based on proposals in the budgetø.¿; 

(17) information on estimates of appropriations for the fiscal 

year following the fiscal year for which the budget is submitted 


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for grants, contracts, and other payments under each program 

for which there is an authorization of appropriations for that 

following fiscal year when the appropriations are authorized to 

be included in an appropriation law for the fiscal year before 

the fiscal year in which the appropriation is to be available for 

obligationø.¿; 

(18) a comparison of the total amount of budget outlays for 

the prior fiscal year, estimated in the budget submitted for 

that year, for each major program having relatively uncontrollable outlays with the total amount of outlays for that program 

in that yearø.¿; 

(19) a comparison of the total amount of receipts for the 

prior fiscal year, estimated in the budget submitted for that 

year, with receipts received in that year, and for each major 

source of receipts, a comparison of the amount of receipts estimated in that budget with the amount of receipts from that 

source in that yearø.¿; 

(20) an analysis and explanation of the differences between 

each amount compared under clauses (18) and (19) of this 

subsectionø.¿; 

(21) a horizontal budget showing— 

(A) the programs for meteorology and of the National 

Climate Program established under section 5 of the National Climate Program Act (15 U.S.C. 2904); 

(B) specific aspects of the program of, and appropriations 

for, each agency; and 

(C) estimated goals and financial requirementsø.¿; 

(22) a statement of budget authority, proposed budget authority, budget outlays, and proposed budget outlays, and descriptive information in terms of— 

(A) a detailed structure of national needs that refers to 

the missions and programs of agencies (as defined in section 101 of this title); and 

(B) the missions and basic programsø.¿; 

(23) separate appropriation accounts for appropriations 

under the Occupational Safety and Health Act of 1970 (29 

U.S.C. 651 et seq.) and the Federal Mine Safety and Health 

Act of 1977 (30 U.S.C. 801 et seq.)ø.¿; 

(24) recommendations on the return of Government capital 

to the Treasury by a mixed-ownership corporation (as defined 

in section 9101(2) of this title) that the President decides are 

desirableø.¿; 

(25) a separate appropriation account for appropriations for 

each Office of Inspector General of an establishment defined 

under section 11(2) of the Inspector General Act of 1978ø.¿; 

(26) a separate statement of the amount of appropriations requested for the Office of National Drug Control Policy and each 

program of the National Drug Control Programø.¿; 

(27) a separate statement of the amount of appropriations requested for the Office of Federal Financial Managementø.¿; 

(28) beginning with fiscal year 1999, a Federal Government 

performance plan for the overall budget as provided for under 

section 1115ø.¿; 


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(29) information about the Violent Crime Reduction Trust 

Fund, including a separate statement of amounts in that Trust 

Fundø.¿; 

(30) an analysis displaying, by agency, proposed reductions 

in full-time equivalent positions compared to the current year’s 

level in order to comply with section 5 of the Federal Workforce Restructuring Act of 1994ø.¿; 

(31) a separate statement of the amount of appropriations requested for the Chief Financial Officer in the Executive Office 

of the Presidentø.¿; 

(32) a statement of the levels of budget authority and outlays 

for each program assumed to be extended in the baseline as 

provided in section 257(b)(2)(A) and for excise taxes assumed 

to be extended under section 257(b)(2)(C) of the Balanced 

Budget and Emergency Deficit Control Act of 1985ø.¿; 

(33) a separate appropriation account for appropriations for 

the Inspectors General Criminal Investigator Academy and the 

Inspectors General Forensic Laboratory of the Department of 

the Treasuryø.¿; 

(34) with respect to the amount of appropriations requested 

for use by the Export-Import Bank of the United States, a separate statement of the amount requested for its program budget, the amount requested for its administrative expenses, and 

of the amount requested for its administrative expenses, the 

amount requested for technology expensesø.¿; 

ø(33)¿ (35) (a) * * * 

(h)(1) If there is a medicare funding warning under section 

801(a)(2) of the Medicare Prescription Drug, Improvement, and 

Modernization Act of 2003 made in a year, the President shall submit to Congress, within the 15-day period beginning on the date of 

the budget submission to Congress under subsection (a) for the succeeding year, proposed legislation to respond to such warning. 

(2) Paragraph (1) does not apply if, during the year in which the 

warning is made, legislation is enacted which eliminates excess 

general revenue medicare funding (as defined in section 801(c) of 

the Medicare Prescription Drug, Improvement, and Modernization 

Act of 2003) for the 7-fiscal-year reporting period, as certified by 

the Board of Trustees of each medicare trust fund (as defined in 

section 801(c)(5) of such Act) not later than 30 days after the date 

of the enactment of such legislationø.¿; and 

(36) the reports prepared under section 11317(f) of title 40, 

United States Code, relating to the core IT investment projects 

of the agency. 

* * * * * * * 

TITLE 40—PUBLIC BUILDINGS, PROPERTY, 

AND WORKS 

* * * * * * * 

Subtitle III—Information Technology 

Management 

* * * * * * * 


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CHAPTER 113—RESPONSIBILITY FOR ACQUISITIONS OF 

INFORMATION TECHNOLOGY 

* * * * * * * 

Subchapter II—Executive Agencies 

* * * * * * * 

§ 11317. [Significant deviations] Significant and gross deviations 

‘‘(a) DEFINITIONS.—In this subchapter: 

‘‘(1) AGENCY HEAD.—The term ‘Agency Head’ means the head 

of the Federal agency that is primarily responsible for the IT investment project under review. 

‘‘(2) ANSI EIA 748 B STANDARD.—The term ‘ANSI—EIA–748– 

B Standard’ means the measurement tool jointly developed by 

the American National Standards Institute and the Electronic 

Industries Alliance to analyze Earned Value Management systems. 

‘‘(3) APPROPRIATE CONGRESSIONAL COMMITTEES.—The term 

‘appropriate congressional committees’ means— 

‘‘(A) the Committee on Homeland Security and Governmental Affairs of the Senate; 

‘‘(B) the Committee on Oversight and Government Reform 

of the House of Representatives; 

‘‘(C) the Committee on Appropriations of the Senate; 

‘‘(D) the Committee on Appropriations of the House of 

Representatives; and 

‘‘(E) any other relevant congressional committee with jurisdiction over an agency required to take action under this 

section. 

‘‘(4) CHIEF INFORMATION OFFICER.—The term ‘Chief Information Officer’ means the Chief Information Officer designated 

under section 3506(a)(2) of title 44 of the Federal agency that 

is primarily responsible for the IT investment project under review. 

‘‘(5) CORE IT INVESTMENT PROJECT.—The terms ‘core IT investment project’ and ‘core project’ mean a mission critical IT 

investment project designated as such by the Chief Information 

Officer, with approval by the Agency Head under subsection (b). 

‘‘(6) DIRECTOR.—The term ‘Director’ means the Director of the 

Office of Management and Budget. 

‘‘(7) EARNED VALUE MANAGEMENT.—The term ‘Earned Value 

Management’ means the cost, performance, and schedule data 

used to determine project status and developed in accordance 

with the ANSI EIA–748–B standard. 

‘‘(8) GROSSLY DEVIATED.—The term ‘grossly deviated’ means 

cost, schedule, or performance variance that is at least 40 percent from the Original Baseline. 

‘‘(9) INDEPENDENT GOVERNMENT COST ESTIMATE.—The term 

‘independent government cost estimate’ means a pragmatic and 

neutral analysis, assessment, and quantification of all costs 

and risks associated with the acquisition of an IT investment 

project, which— 


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‘‘(A) is based on programmatic and technical specifications provided by the office within the agency with primary 

responsibility for the development, procurement, and delivery of the project; 

‘‘(B) is formulated and provided by an entity other than 

the office within the agency with primary responsibility for 

the development, procurement, and delivery of the project; 

‘‘(C) contains sufficient detail to inform the selection of 

an Earned Value Management baseline benchmark measure under the ANSI EIA 748–B standard; and 

‘‘(D) accounts for the full life cycle cost plus associated 

operations and maintenance expenses over the usable life of 

the project’s deliverables. 

‘‘(10) IT INVESTMENT PROJECT.—The terms ‘major IT investment project’ and ‘project’ mean an information technology system or information technology acquisition, excluding systems or 

acquisitions of the Department of Defense, that— 

(A) requires special management attention because of its 

importance to the mission or function of the agency, a component of the agency, or another organization; 

(B) is for financial management and obligates more than 

$500,000 annually; 

(C) has significant program or policy implications; 

(D) has high executive visibility; 

(E) has high development, operating, or maintenance 

costs; 

(F) is funded through other than direct appropriations; 

or 

(G) is defined as major by the agency’s capital planning 

and investment control process 

‘‘(11) LIFE CYCLE COST.—The term ‘life cycle cost’ means the 

total cost of an IT investment project for planning, research and 

development, modernization, enhancement, operation, and 

maintenance. 

‘‘(12) ORIGINAL BASELINE.— 

‘‘(A) IN GENERAL.—Except as provided under subparagraph (B), the term ‘Original Baseline’ means the ANSI 

EIA–748–B Standard-compliant Earned Value Management benchmark established at the commencement of an IT 

investment project. 

‘‘(B) GROSSLY DEVIATED PROJECT.—If an IT investment 

project grossly deviates from its Original Baseline (as defined in subparagraph (A)), the term ‘Original Baseline’ 

means the ANSI EIA–748–B Standard-compliant Earned 

Value Management benchmark established under subsection (e)(3)(C). 

‘‘(13) SIGNIFICANTLY DEVIATED.—The term ‘significantly deviated’ means Earned Value Management variance that is at 

least 20 percent from the Original Baseline. 

‘‘(b) CORE IT INVESTMENT PROJECTS DESIGNATION.—Except as 

provided under paragraph (2), each Chief Information Officer, with 

approval by the Agency Head, shall— 

‘‘(1) identify the major IT investments that are the most critical to the agency; and 


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‘‘(2) any project as a core ‘IT investment project’ or a ‘core 

project’, upon determining that the project is a mission critical 

IT investment project that— 

‘‘(A) represents a significant high-dollar value relative to 

the average IT investment project in the agency’s portfolio; 

‘‘(B) delivers a capability critical to the successful completion of the agency mission, or a portion of such mission; 

‘‘(C) incorporates unproven or previously undeveloped 

technology to meet primary project technical requirements; 

or 

‘‘(D) would have a significant negative impact on the successful completion of the agency mission if the project experienced significant cost, schedule, or performance deviations. 

‘‘(c) COST, SCHEDULE, AND PERFORMANCE REPORTS.— 

‘‘(1) QUARTERLY REPORTS.—Not later than 14 days after the 

end of each fiscal quarter, the project manager for an IT investment project shall submit a written report to the Chief Information Officer that includes, as of the last day of the applicable 

quarter— 

‘‘(A) a description of the cost, schedule, and performance 

of all projects under the project manager’s supervision; 

‘‘(B) the original and current project cost, schedule, and 

performance benchmarks for each project under the project 

manager’s supervision; 

‘‘(C) the quarterly and cumulative cost, schedule, and 

performance variance related to each IT investment project 

under the project manager’s supervision since the commencement of the project; 

‘‘(D) for each IT investment project under the project 

manager’s supervision, any known, expected, or anticipated 

changes to project schedule milestones or project performance benchmarks included as part of the original or current 

baseline description; 

‘‘(E) the current cost, schedule, and performance status of 

all IT investment projects under supervision that were previously identified as significantly deviated or grossly deviated; and 

‘‘(F) any corrective actions taken to address problems discovered under subparagraphs (C) through (E). 

‘‘(2) INTERIM REPORTS.—If the project manager for an IT investment project determines that there is reasonable cause to believe that an IT investment project has significantly deviated or 

grossly deviated since the issuance of the latest quarterly report, 

the project manager shall submit to the Chief Information Officer, not later than 14 days after such determination, a report 

on the project that includes, as of the date of the report— 

‘‘(A) a description of the original and current program 

cost, schedule, and performance benchmarks; 

‘‘(B) the cost, schedule, or performance variance related to 

the IT investment project since the commencement of the 

project; 

‘‘(C) any known, expected, or anticipated changes to the 

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marks included as part of the original or current baseline 

description; 

‘‘(D) the major reasons underlying the significant or gross 

deviation of the project; and 

‘‘(E) a corrective action plan to correct such deviations. 

‘‘(d) DETERMINATION OF SIGNIFICANT DEVIATION.— ‘‘(1) CHIEF INFORMATION OFFICER.—Upon receiving a report 

under subsection (c), the Chief Information Officer shall— 

‘‘(A) determine if any IT investment project has significantly deviated; and 

‘‘(B) report such determination to the Agency Head. 

‘‘(2) CONGRESSIONAL NOTIFICATION.—If the Chief Information 

Officer determines under paragraph (1) that an IT investment 

project has significantly deviated and the Agency Head has not 

issued a report to the appropriate congressional committees of 

a significant deviation for that project under this section since 

the project was last required to be rebaselined under this section, the Agency Head shall submit a report to the appropriate 

congressional committees, the Director, and the Government Accountability Office that includes— 

‘‘(A) written notification of such determination; 

‘‘(B) the date on which such determination was made; 

‘‘(C) the amount of the cost increases and the extent of the 

schedule delays with respect to such project; 

‘‘(D) any requirements that— 

‘‘(i) were added subsequent to the original contract; 

or 

‘‘(ii) were originally contracted for, but were changed 

by deferment or deletion from the original schedule, or 

were otherwise no longer included in the requirements 

contracted for; 

‘‘(E) an explanation of the differences between— 

‘‘(i) the estimate at completion between the project 

manager, any contractor, and any independent analysis; and 

‘‘(ii) the original budget at completion; 

‘‘(F) a statement of the reasons underlying the project’s 

significant deviation; and 

‘‘(G) a summary of the plan of action to remedy the significant deviation. 

‘‘(3) DEADLINE.— 

‘‘(A) NOTIFICATION BASED ON QUARTERLY REPORT.—If the 

determination of significant deviation is based on a report 

submitted under subsection (b)(1), the Agency Head shall 

notify Congress and the Director in accordance with paragraph (2) not later than 21 days after the end of the quarter 

upon which such report is based. 

‘‘(B) NOTIFICATION BASED ON INTERIM REPORT.—If the determination of significant deviation is based on a report 

submitted under subsection (b)(2), the Agency Head shall 

notify Congress and the Director in accordance with paragraph (2) not later than 21 days after the submission of 

such report. 

‘‘(C) METHOD OF DELIVERY.—Information required under 

paragraphs (1) and (2) may be provided through the Web 


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site established under section 11302(c)(1) in a manner consistent with guidance from the Office of Management and 

Budget to satisfy reporting requirements and to reduce paperwork. 

‘‘(e) DETERMINATION OF GROSS DEVIATION.— 

‘‘(1) CHIEF INFORMATION OFFICER.—Upon receiving a report 

under subsection (c), the Chief Information Officer shall— 

‘‘(A) determine if any IT investment project has grossly 

deviated; and 

‘‘(B) report any such determination to the Agency Head. 

‘‘(2) CONGRESSIONAL NOTIFICATION.—If the Chief Information 

Officer determines under paragraph (1) that an IT investment 

project has grossly deviated and the Agency Head has not 

issued a report to the appropriate congressional committees of 

a gross deviation for that project under this section since the 

project was last required to be rebaselined under this section, 

the Agency Head shall submit a report to the appropriate congressional committees, the Director, and the Government Accountability Office that includes— 

‘‘(A) written notification of such determination, which 

states— 

‘‘(i) the date on which such determination was made; 

and 

‘‘(ii) an indication of whether or not the project has 

been previously reported as a significant or gross deviation by the Chief Information Officer, and the date of 

any such report; 

‘‘(B) incorporations by reference of all prior reports to 

Congress on the project required under this section; 

‘‘(C) updated accounts of the items described in subparagraphs (C) through (G) of subsection (d)(2); 

‘‘(D) the original estimate at completion for the project 

manager, any contractor, and any independent analysis; 

‘‘(E) a graphical depiction that shows monthly planned 

expenditures against actual expenditures since the commencement of the project; 

‘‘(F) the amount, if any, of incentive or award fees any 

contractor has received since the commencement of the contract and the reasons for receiving such incentive or award 

fees; 

‘‘(G) the project manager’s estimated cost at completion 

and estimated completion date for the project if current requirements are not modified; 

‘‘(H) the project manager’s estimated cost at completion 

and estimated completion date for the project based on reasonable modification of such requirements; 

‘‘(I) an explanation of the most significant occurrence contributing to the variance identified, including cost, schedule, and performance variances, and the effect such occurrence will have on future project costs and program schedule; 

‘‘(J) a statement regarding previous or anticipated rebaselining or replanning of the project and the names of 

the individuals responsible for approval; 


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‘‘(K) the original life cycle cost of the investment and the 

expected life cycle cost of the investment expressed in constant base year dollars and in current dollars; and 

‘‘(L) a comprehensive plan of action to remedy the gross 

deviation, and milestones established to control future cost, 

schedule, and performance deviations in the future. 

(3) METHOD OF DELIVERY.—Information required under paragraphs (1) and (2) may be provided through the Web site established under section 11302(c)(1) in a manner consistent with 

guidance from the Office of Management and Budget to satisfy 

reporting requirements and to reduce paperwork. 

‘‘(3) REMEDIAL ACTION.— ‘‘(A) IN GENERAL.—If the Chief Information Officer determines under paragraph (1) that an IT investment project 

has grossly deviated, the Agency Head, in consultation with 

the Chief Information Officer, shall develop and implement 

a remedial action plan that includes— 

‘‘(i) a report that— 

‘‘(I) describes the primary business case and key 

functional requirements for the project; 

‘‘(II) describes any portions of the project that 

have technical requirements of sufficient clarity 

that such portions may be feasibly procured under 

firm, fixed-price contract; 

‘‘(III) includes a certification by the Agency 

Head, after consultation with the Chief Information Officer, that all technical requirements have 

been reviewed and validated to ensure alignment 

with the reported business case; 

‘‘(IV) describes any changes to the primary business case or key functional requirements which 

have occurred since project inception; and 

‘‘(V) includes an independent government cost estimate for the project conducted by an entity approved by the Director; 

‘‘(ii) an analysis that— 

‘‘(I) describes agency business goals that the 

project was originally designed to address; 

‘‘(II) includes a gap analysis of what project 

deliverables remain in order for the agency to accomplish the business goals referred to in subclause (I); 

‘‘(III) identifies the 3 most cost-effective alternative approaches to the project which would 

achieve the business goals referred to in subclause 

(I); and 

‘‘(IV) includes a cost-benefit analysis, which compares— 

‘‘(aa) the completion of the project with the 

completion of each alternative approach, after 

factoring in future costs associated with the 

termination of the project; and 

‘‘(bb) the termination of the project without 

pursuit of alternatives, after factoring in foregone benefits; and 


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‘‘(iii) a new baseline of the project is established that 

is consistent with the independent government cost estimate required under clause (i)(V); and 

‘‘(iv) the project is designated as a core IT investment 

project and subjected to the requirements under subsection (f). 

‘‘(B) SUBMISSION TO CONGRESS.—The remedial action 

plan and all corresponding reports, analyses, and actions 

under this paragraph shall be submitted to the appropriate 

congressional committees and the Director. 

‘‘(C) REPORTING AND ANALYSIS EXEMPTIONS.— ‘‘(i) IN GENERAL.—The Chief Information Officer, in 

coordination with the Agency Head and the Director, 

may forego the completion of any element of a report or 

analysis under clause (i) or (ii) of subparagraph (A) if 

the Chief Information Officer determines that such element is not relevant to the understanding of the difficulties facing the project or further continuation of 

the project in a timely and cost-efficient manner. 

‘‘(ii) IDENTIFICATION OF REASONS.—The Chief Information Officer shall include the reasons for not including any element referred to in clause (i) in the report 

submitted to Congress under subparagraph (B). 

‘‘(4) DEADLINE AND FUNDING CONTINGENCY.— ‘‘(A) NOTIFICATION AND REMEDIAL ACTION BASED ON

QUARTERLY REPORT.— ‘‘(i) IN GENERAL.—If the determination of gross deviation is based on a report submitted under subsection 

(c)(1), the Agency Head shall— 

‘‘(I) not later than 45 days after the end of the 

quarter upon which such report is based, notify the 

appropriate congressional committees and the Director in accordance with paragraph (2); and 

‘‘(II) not later than 180 days after the end of the 

quarter upon which such report is based, ensure 

the completion of remedial action under paragraph 

(3). 

‘‘(ii) FAILURE TO MEET DEADLINES.—If the Agency 

Head fails to meet the deadlines described in clause 

(i)(II), additional funds may not be obligated to support expenditures associated with the project until the 

requirements of this subsection have been fulfilled. 

‘‘(B) NOTIFICATION AND REMEDIAL ACTION BASED ON INTERIM REPORT.— 

‘‘(i) IN GENERAL.—If the determination of gross deviation is based on a report submitted under subsection 

(c)(2), the Agency Head shall— 

‘‘(I) not later than 45 days after the submission 

of such report, notify the appropriate congressional 

committees in accordance with paragraph (2); and 

‘‘(II) not later than 180 days after the submission 

of such report, ensure the completion of remedial 

action in accordance with paragraph (3). 

‘‘(ii) FAILURE TO MEET DEADLINES.—If the Agency 

Head fails to meet the deadlines described in clause 


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(i)(II), additional funds may not be obligated to support expenditures associated with the project until the 

requirements of this subsection have been fulfilled. 

‘‘(f) ADDITIONAL REQUIREMENTS FOR CORE IT INVESTMENT

PROJECT REPORTS.— 

‘‘(1) INITIAL REPORT.—If a report described in subsection 

(e)(3)(A) has not been submitted for a core IT investment 

project, the Agency Head, in coordination with the Chief Information Officer and responsible program managers, shall prepare an initial report for inclusion in the first budget submitted 

to Congress under section 1105(a) of title 31, United States 

Code, after the designation of a project as a core IT investment 

project, which includes— 

‘‘(A) a description of the primary business case and key 

functional requirements for the project; 

‘‘(B) an identification and description of any portions of 

the project that have technical requirements of sufficient 

clarity that such portions may be feasibly procured under 

firm, fixed-price contracts; 

‘‘(C) an independent government cost estimate for the 

project; 

‘‘(D) certification by the Chief Information Officer that all 

technical requirements have been reviewed and validated to 

ensure alignment with the reported business case; and 

‘‘(E) any changes to the primary business case or key 

functional requirements which have occurred since project 

inception. 

‘‘(2) QUARTERLY REVIEW OF BUSINESS CASE.—The Agency 

Head, in coordination with the Chief Information Officer and 

responsible program managers, shall— 

‘‘(A) monitor the primary business case and core 

functionality requirements reported to Congress and the Director for designated core IT investment projects; and 

‘‘(B) if changes to the primary business case or key functional requirements for a core IT investment project occur 

in any fiscal quarter, submit a report to Congress and the 

Director not later than 14 days after the end of such quarter that details the changes and describes the impact the 

changes will have on the cost and ultimate effectiveness of 

the project. 

‘‘(3) ALTERNATIVE SIGNIFICANT DEVIATION DETERMINATION.— 

If the Chief Information Officer determines, subsequent to a 

change in the primary business case or key functional requirements, that without such change the project would have significantly deviated— 

‘‘(A) the Chief Information Officer shall notify the Agency 

Head of the significant deviation; and 

‘‘(B) the Agency Head shall fulfill the requirements under 

subsection (d)(2) in accordance with the deadlines under 

subsection (d)(3). 

‘‘(4) ALTERNATIVE GROSS DEVIATION DETERMINATION.—If the 

Chief Information Officer determines, subsequent to a change in 

the primary business case or key functional requirements, that 

without such change the project would have grossly deviated— 


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‘‘(A) the Chief Information Officer shall notify the Agency 

Head of the gross deviation; and 

‘‘(B) the Agency Head shall fulfill the requirements under 

subsections (e)(2) and (e)(3) in accordance with subsection 

(e)(4).’’ 

* * * * * * * 

§ 11319. Acquisition and development 

(a) PURPOSE.—The objective of this section is to significantly reduce— 

(1) cost overruns and schedule slippage from the estimates established at the time the program is initially approved; 

(2) the number of requirements and business objectives at the 

time the program is approved that are not met by the delivered 

products; and 

(3) the number of critical defects and serious defects in delivered information technology. 

‘‘(b) ESTABLISHMENT OF PROGRAMS.—The Director of the Office of 

Management and Budget shall— 

(1) Not later than 180 days after the date of the enactment 

of this section, prescribe uniformly applicable guidance for 

agencies to implement the requirements of this section, which 

shall not include any exemptions to such requirements not specifically authorized under this section; and 

(2) Take any actions that are necessary to ensure that Federal 

agencies are in compliance with the guidance prescribed pursuant to paragraph (1) not later than 1 year after the date of the 

enactment of this section. 

(c) ESTABLISHMENT OF PROGRAM.—Not later than 120 days after 

the enactment of this section, the Agency Head (as defined in section 

11317(a) of title 40, United States Code) shall establish a program 

to improve the information technology (referred to in this section as 

‘IT) process overseen by the Chief Information Officer. 

(d) PROGRAM REQUIREMENTS.—Each program established pursuant to this section shall include— 

‘‘(1) a documented process for information technology acquisition planning, requirements development and management, 

project management and oversight, earned-value management, 

and risk management; 

‘‘(2) the development of appropriate metrics for performance 

measurement of— 

‘‘(A) processes and development status; 

‘‘(B) continuous process improvement; and 

‘‘(C) achievement of project outcomes; 

‘‘(3) a process to ensure that key program personnel have an 

appropriate level of experience and training and education, at 

an institution or institutions approved by the Director, in the 

planning, acquisition, execution, management, and oversight of 

information technology; 

‘‘(4) a process to ensure that the applicable department and 

subcomponents implement and adhere to established processes 

and requirements relating to the planning, acquisition, execution, management, and oversight of information technology programs and developments; and 


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‘‘(5) a process for the Chief Information Officer to intervene or 

stop the funding of an IT investment if it is at risk of not 

achieving major project milestones. 

‘‘(e) ANNUAL REPORT TO OMB.—Not later than the last day of 

February of each year, the Agency Head shall submit a report to 

Congress that includes— 

‘‘(1) a detailed summary of the accomplishments of the program established by the Agency Head pursuant to this section; 

‘‘(2) the status of completeness of implementation of each of 

the program requirements, and the date each such requirement 

was deemed to be completed; 

‘‘(3) the percentage of Federal IT projects covered under the 

program compared to all of the IT projects of the agency, listed 

by number of programs and by annual dollars expended; 

‘‘(4) a detailed breakdown of the sources and uses of the 

amounts spent by the agency during the previous fiscal year to 

support the activities of the program; 

‘‘(5) a copy of any guidance issued under the program and a 

statement regarding whether each such guidance is mandatory; 

‘‘(6) the identification of the metrics developed in accordance 

with subsection (b)(2); 

‘‘(7) a description of how paragraphs (3) and (4) of subsection 

(b) have been implemented and any related agency guidance; 

and 

‘‘(8) a description of how continuous process improvement has 

been implemented and the objectives of such guidance.’’ 

(f) ANNUAL REPORT TO CONGRESS.—The Director of the Office of 

Management and Budget shall provide an annual report to Congress on the status and implementation of the program established 

pursuant to this section. 

Æ 


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