Code, including specific input relating to each capabilities 
development document. 
‘‘(c) ACCESS TO RECORDS OF THE MILITARY DE-
PARTMENTS.—The official designated to perform over-
sight of systems engineering pursuant to section 145 of 
this title shall have access to any records or data of the 
Department of Defense (including the records and data 
of each military department and including classified and 
proprietary information as appropriate) that the official 
considers necessary to review in order to carry out any 
duties under this section. 
‘‘(d) ASSESSMENT OF MILITARY DEPARTMENT CA-
PABILITIES FOR SYSTEMS ENGINEERING AND DEVELOP-
MENTAL
TEST
AND
EVALUATION.—The official des-
ignated to perform oversight of systems engineering pur-
suant to section 145 of this title shall periodically assess 
the capabilities of the military departments for systems 
engineering and developmental test and evaluation and 
provide such assessment, along with such recommenda-
tions for improvement as the official considers necessary, 
to the Secretary of Defense and the Under Secretary of 
Defense for Acquisition, Technology, and Logistics. 
‘‘(e) REVIEW AND APPROVAL OF PLANS FOR MAJOR 
DEFENSE ACQUISITION PROGRAMS.—The official des-
ignated to perform oversight of systems engineering pur-
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suant to section 145 of this title shall review and approve 
the following plans with respect to any major defense ac-
quisition program: 
‘‘(1) The systems engineering master plan. 
‘‘(2) The developmental test and evaluation 
plan within the test and evaluation master plan. 
‘‘(f) ANNUAL REPORT.—Not later than March 1 of 
each year, beginning on March 1, 2010, the official des-
ignated to perform oversight of systems engineering pur-
suant to section 145 of this title shall submit to the con-
gressional defense committees a report on the activities 
undertaken pursuant to this section during the preceding 
year.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
at the beginning of such chapter, as amended by section 
102, is further amended by adding at the end the following 
new item: 
‘‘2334a. Acquisition oversight: oversight of systems engineering.’’. 
SEC. 104. OVERSIGHT OF PERFORMANCE ASSESSMENT. 
(a) IN GENERAL.—Chapter 137 of title 10, United 
States Code, as amended by section 103, is further amend-
ed by adding at the end the following new section: 
‘‘§ 2334b. Acquisition oversight: oversight of perform-
ance assessment 
‘‘(a) ISSUANCE
OF POLICIES, PROCEDURES, AND 
GUIDANCE FOR PERFORMANCE ASSESSMENTS.—The offi-
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cial designated to perform oversight of performance as-
sessment pursuant to section 145 of this title shall be re-
sponsible for the issuance of policies, procedures, and 
guidance governing the conduct of performance assess-
ments for the acquisition programs of the Department of 
Defense, including assessment of the extent to which ac-
quisition programs— 
‘‘(1) 
deliver 
sufficient 
capability 
to 
the 
warfighter; 
‘‘(2) achieve timely delivery of such capability; 
and 
‘‘(3) deliver a level of value consistent with re-
sources expended. 
‘‘(b) ASSESSMENT OF BASELINE QUALITY.—The of-
ficial designated to perform oversight of performance as-
sessment pursuant to section 145 of this title shall periodi-
cally assess the suitability of the baseline descriptions re-
quired by section 2435 of title 10, United States Code, 
of major defense acquisition programs for providing a 
basis for performance assessment and make such rec-
ommendations to the Secretary of Defense and the Under 
Secretary of Defense for Acquisition, Technology, and Lo-
gistics as the official considers necessary to improve the 
suitability of baseline descriptions for such purpose. 
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‘‘(c) EARNED VALUE MANAGEMENT SYSTEM.—The 
official designated to perform oversight of performance as-
sessment pursuant to section 145 of this title shall be re-
sponsible for the management and oversight of the records 
of the earned value management system of the Depart-
ment of Defense. 
‘‘(d) PARTICIPATION
IN CERTAIN PROGRAM RE-
VIEW.—The official designated to perform oversight of 
performance assessment pursuant to section 145 of this 
title is authorized to present an assessment of the per-
formance of a major defense acquisition program during— 
‘‘(1) any discussions prior to certification under 
section 2433(e)(2) of this title; 
‘‘(2) any discussions prior to entry into full-rate 
production; and 
‘‘(3) consideration of any decision to request 
authorization of a multiyear procurement contract 
for a major defense acquisition program. 
‘‘(e) ANNUAL REPORT.—Not later than March 1 of 
each year, beginning on March 1, 2010, the official des-
ignated to perform oversight of performance assessment 
pursuant to section 145 of this title shall submit to the 
congressional defense committees a report on the activities 
undertaken pursuant to this section during the preceding 
year.’’. 
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(b) CLERICAL AMENDMENT.—The table of sections 
at the beginning of such chapter, as amended by section 
103, is further amended by adding at the end the following 
new item: 
‘‘2334b. Acquisition oversight: oversight of performance assessment.’’. 
SEC. 105. ASSESSMENT OF TECHNOLOGICAL MATURITY OF 
CRITICAL TECHNOLOGIES OF MAJOR DE-
FENSE ACQUISITION PROGRAMS BY THE DI-
RECTOR OF DEFENSE RESEARCH AND ENGI-
NEERING. 
(a) ASSESSMENT BY DIRECTOR OF DEFENSE RE-
SEARCH AND ENGINEERING.— 
(1) IN
GENERAL.—Section 139a of title 10, 
United States Code, is amended by adding at the 
end the following new subsection: 
‘‘(c)(1) The Director of Defense Research and Engi-
neering shall periodically review and assess the techno-
logical maturity and integration risk of critical tech-
nologies of the major defense acquisition programs of the 
Department of Defense and report on the findings of such 
reviews and assessments to the Under Secretary of De-
fense for Acquisition, Technology, and Logistics. 
‘‘(2) The Director shall submit to the Secretary of 
Defense and to the congressional defense committees by 
January 1 of each year a report on the technological matu-
rity and integration risk of critical technologies of the 
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major defense acquisition programs of the Department of 
Defense.’’. 
(2) FIRST ANNUAL REPORT.—The first annual 
report under subsection (c)(2) of section 139a of 
title 10, United States Code (as added by paragraph 
(1)), shall be submitted to Congress not later than 
March 1, 2011, and shall address the results of re-
views and assessments conducted by the Director of 
Defense Research and Engineering pursuant to sub-
section (c)(1) of such section (as so added) during 
the preceding calendar year. 
(b) REPORT
ON RESOURCES
FOR IMPLEMENTA-
TION.—Not later than 120 days after the date of the en-
actment of this Act, the Director of Defense Research and 
Engineering shall submit to the congressional defense 
committees a report describing any additional resources 
that may be required by the Director, and by other re-
search and engineering elements of the Department of De-
fense, to carry out the following: 
(1) The requirements under the amendment 
made by subsection (a)(1). 
(2) The technological maturity assessments re-
quired by section 2366b(a) of title 10, United States 
Code. 
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(3) The requirements of Department of Defense 
Instruction 5000, as revised. 
SEC. 106. ROLE OF THE COMMANDERS OF THE COMBATANT 
COMMANDS IN IDENTIFYING JOINT MILITARY 
REQUIREMENTS. 
Section 181(d) of title 10, United States Code, is 
amended— 
(1) by inserting ‘‘(1)’’ before ‘‘The Under Sec-
retary’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(2) The Council shall seek and consider input from 
the commanders of the combatant commands in carrying 
out its mission under paragraphs (1) and (2) of subsection 
(b) and in conducting periodic reviews in accordance with 
the requirements of subsection (e).’’. 
TITLE II—ACQUISITION POLICY 
SEC. 201. ACQUISITION STRATEGIES ENSURING COMPETI-
TION 
THROUGHOUT 
THE 
LIFECYCLE 
OF 
MAJOR DEFENSE ACQUISITION PROGRAMS. 
(a) ACQUISITION STRATEGY ENSURING COMPETI-
TION.—The Secretary of Defense shall ensure that the ac-
quisition strategy for each major defense acquisition pro-
gram includes measures to ensure competition, or the op-
tion of competition, at both the prime contract level and 
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the subcontract level of such program throughout the life- 
cycle of such program as a means to improve contractor 
performance. 
(b) MEASURES TO ENSURE COMPETITION.—The 
measures to ensure competition, or the option of competi-
tion, for purposes of subsection (a) may include measures 
to achieve the following, in appropriate cases if such meas-
ures are cost-effective: 
(1) Competitive prototyping. 
(2) Dual-sourcing. 
(3) Funding of a second source for interchange-
able, next-generation prototype systems or sub-
systems. 
(4) Use of modular, open architectures to en-
able competition for upgrades. 
(5) Use of build-to-print approaches to enable 
production through multiple sources. 
(6) Acquisition of complete technical data pack-
ages. 
(7) Periodic competitions for subsystem up-
grades. 
(8) Licensing of additional suppliers. 
(9) Periodic system or program reviews to ad-
dress long-term competitive effects of program deci-
sions. 
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SEC. 202. ADDITIONAL REQUIREMENTS FOR CERTAIN 
MAJOR DEFENSE ACQUISITION PROGRAMS. 
(a) ADDITIONAL
REQUIREMENTS
RELATING
TO 
MILESTONE B APPROVAL.—Section 2366b of title 10, 
United States Code, is amended— 
(1) in subsection (d)— 
(A) by inserting ‘‘(1)’’ before ‘‘The Mile-
stone Decision Authority may’’; and 
(B) by striking the second sentence and in-
serting the following: 
‘‘(2) Whenever the Milestone Decision Authority 
makes such a determination and authorizes such a waiv-
er— 
‘‘(A) the waiver, the determination, and the 
reasons for the determination shall be submitted in 
writing to the congressional defense committees 
within 30 days after the waiver is authorized; and 
‘‘(B) the Milestone Decision Authority shall re-
view the program not less often than annually to de-
termine the extent to which such program currently 
satisfies the certification components specified in 
paragraphs (1) and (2) of subsection (a) until such 
time as the Milestone Decision Authority determines 
that the program satisfies all such certification com-
ponents.’’; 
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(2) by redesignating subsections (e) and (f) as 
subsections (f) and (g), respectively, and inserting 
after subsection (d) the following new subsection (e): 
‘‘(e) DESIGNATION OF CERTIFICATION STATUS IN 
BUDGET DOCUMENTATION.—Any budget request, budget 
justification material, budget display, reprogramming re-
quest, Selected Acquisition Report, or other budget docu-
mentation or performance report submitted by the Sec-
retary of Defense to the President regarding a major de-
fense acquisition program receiving a waiver pursuant to 
subsection (d) shall prominently and clearly indicate that 
such program has not fully satisfied the certification re-
quirements of this section until such time as the Milestone 
Decision Authority makes the determination that such 
program has satisfied all certification components pursu-
ant to subsection (d)(2)(B).’’; 
(3) in subsection (a)— 
(A) in paragraph (1), by striking ‘‘and’’ at 
the end; 
(B) by redesignating paragraph (2) as 
paragraph (3); 
(C) by inserting after paragraph (1) the 
following new paragraph (2): 
‘‘(2) has received a preliminary design review 
and conducted a formal post-preliminary design re-
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view assessment, and certifies on the basis of such 
assessment that the program demonstrates a high 
likelihood of accomplishing its intended mission; 
and’’; and 
(D) in paragraph (3), as redesignated by 
subparagraph (B) of this paragraph— 
(i) in subparagraph (D), by striking 
the semicolon and inserting ‘‘, as deter-
mined by the Milestone Decision Authority 
on the basis of an independent review and 
assessment by the Director of Defense Re-
search and Engineering; and’’; 
(ii) by striking subparagraph (E); and 
(iii) by redesignating subparagraph 
(F) as subparagraph (E). 
(b) CERTIFICATION AND REVIEW OF PROGRAMS EN-
TERING DEVELOPMENT PRIOR TO ENACTMENT OF SEC-
TION 2366b OF TITLE 10.— 
(1) DETERMINATION.—(A) Except as provided 
in subparagraph (B), beginning not later than 270 
days after the date of the enactment of this Act, for 
each major defense acquisition program that has not 
received a Milestone C approval, or Key Decision 
Point C approval in the case of a space program, the 
Milestone Decision Authority shall determine wheth-
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er or not the program satisfies the certification com-
ponents specified in paragraphs (1) and (2) of sub-
section (a) of section 2366b of title 10, United 
States Code. 
(B) Subparagraph (A) shall not apply to a 
major defense acquisition program that has been re-
viewed pursuant to section 2366b, title 10, United 
States Code, prior to the date that is 270 days after 
the date of the enactment of this Act. 
(2) ANNUAL REVIEW.—The Milestone Decision 
Authority shall review any program determined pur-
suant to paragraph (1) not to satisfy the certifi-
cation components of subsection (a) of section 2366b 
of title 10, United States Code, not less often than 
annually thereafter to determine the extent to which 
such program currently satisfies the certification 
components specified in paragraphs (1) and (2) of 
subsection (a) of such section until such time as the 
Milestone Decision Authority determines that the 
program satisfies all such certification components. 
(3) DESIGNATION OF CERTIFICATION STATUS 
IN BUDGET DOCUMENTATION.—Any budget request, 
budget justification material, budget display, re-
programming request, Selected Acquisition Report, 
or other budget documentation or performance re-
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port submitted by the Secretary of Defense to the 
President regarding a major defense acquisition pro-
gram which the Milestone Decision Authority deter-
mines under paragraph (1) does not satisfy the cer-
tification components specified in paragraphs (1) 
and (2) of subsection (a) of section 2366b of title 
10, United States Code, shall prominently and clear-
ly indicate that such program has not fully satisfied 
such certification components until such time as the 
Milestone Decision Authority makes the determina-
tion that such program has satisfied all certification 
components pursuant to paragraph (2). 
(c) REVIEWS OF PROGRAMS RESTRUCTURED AFTER 
EXPERIENCING CRITICAL COST GROWTH.—The official 
designated to perform oversight of performance assess-
ment pursuant to section 145 of title 10, United States 
Code, as added by this Act, shall annually review each 
major defense acquisition program that has been consid-
ered pursuant to paragraph (2) of section 2433(e) of title 
10, United States Code, and which has been certified as 
necessary to continue pursuant to such paragraph, to as-
sess the success of the program in achieving adequate pro-
gram performance after the completion of such consider-
ation. The results of reviews performed pursuant to this 
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subsection shall be included in the next annual report of 
such official. 
SEC. 203. REQUIREMENT FOR CERTIFICATION OF MAJOR 
SYSTEMS PRIOR TO MILESTONE B. 
(a) CERTIFICATION.—Except as provided in sub-
section (b), beginning not later than 270 days after the 
date of the enactment of this Act, for each major defense 
acquisition program that has not received Milestone B ap-
proval, or Key Decision Point B approval in the case of 
a space program, the Milestone Decision Authority shall 
certify, after consultation with the Joint Requirements 
Oversight Council on matters relating to program require-
ments and military needs— 
(1) that the program fulfills an approved initial 
capabilities document; 
(2) that the program is being executed by an 
entity with a relevant core competency as identified 
by the Secretary of Defense under section 118b of 
title 10, United States Code; 
(3) if the program duplicates a capability al-
ready provided by an existing program, the duplica-
tion provided by such program is necessary and ap-
propriate; 
(4) that a cost estimate for the development of 
such program has been submitted to the Milestone 
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Decision Authority and that the concurrence of the 
official designated to perform oversight of cost esti-
mation pursuant to section 145 of title 10, United 
States Code, has been obtained regarding the choice 
of a cost estimate; and 
(5) that a schedule identifying the time and 
major activities required to reach Milestone B ap-
proval, or Key Decision Point B approval in the case 
of a space program, has been submitted to the Mile-
stone Decision Authority. 
(b) EXCEPTION.—Subsection (a) shall not apply to 
a major defense acquisition program that has received a 
certification as required by section 2366a, title 10, United 
States Code. 
(c) REPORTS.— 
(1) RELATING TO COST GROWTH OR SCHEDULE 
DELAY
OF
PROGRAMS
CERTIFIED
UNDER
SUB-
SECTION (a).—With respect to a major defense ac-
quisition program certified by the Milestone Decision 
Authority under subsection (a), the Milestone Deci-
sion Authority shall submit to the congressional de-
fense committees a report in accordance with this 
subsection if, prior to Milestone B approval— 
(A) the projected development cost of the 
program exceeds the cost estimate for the pro-
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gram submitted to the Milestone Decision Au-
thority in accordance with subsection (a)(4) by 
more than 25 percent; or 
(B) the schedule submitted to the Mile-
stone Decision Authority in accordance with 
subsection (a)(5) is delayed by more than 25 
percent. 
(2) RELATING TO COST GROWTH OF PROGRAMS 
CERTIFIED UNDER SECTION 2366a.—With respect to 
a major defense acquisition program certified by the 
Milestone Decision Authority under section 2366a of 
title 10, United States Code, the Milestone Decision 
Authority shall submit to the congressional defense 
committees a report in accordance with this sub-
section if the program manager submits a notifica-
tion to the Milestone Decision Authority pursuant to 
section 2366a(b). 
(3) MATTERS COVERED.—Any report submitted 
pursuant to paragraph (1) or (2) shall— 
(A) identify the root causes of the cost or 
schedule growth; 
(B) identify appropriate acquisition per-
formance measures for the remainder of the de-
velopment of the program; and 
(C) include one of the following: 
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(i) A written certification (with a sup-
porting explanation) stating that— 
(I) such program is essential to 
national security; 
(II) there are no alternatives to 
such program that will provide accept-
able military capability at less cost; 
(III) new estimates of the devel-
opment cost or schedule, as appro-
priate, are reasonable; and 
(IV) the management structure 
for the program is adequate to man-
age and control program development 
cost and schedule. 
(ii) A plan for terminating the devel-
opment of the program or withdrawal of 
Milestone A approval (or Key Decision 
Point A approval in the case of a space 
program) if the Milestone Decision Author-
ity determines that such action is in the in-
terest of national defense. 
(4) TIME OF SUBMISSION.—A report required 
by this subsection shall be submitted— 
(A) in the case of a report required by 
paragraph (1), not later than 30 days after the 
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Milestone Decision Authority determines the 
cost growth or schedule delay described in that 
paragraph; and 
(B) in the case of a report required by 
paragraph (2), not later than 30 days after the 
Milestone Decision Authority receives the notifi-
cation from the program manager described in 
that paragraph. 
(d) DEFINITIONS.—In this section: 
(1) MAJOR DEFENSE ACQUISITION PROGRAM.— 
The term ‘‘major defense acquisition program’’ has 
the meaning provided in section 2430 of title 10, 
United States Code. 
(2) INITIAL
CAPABILITIES
DOCUMENT.—The 
term ‘‘initial capabilities document’’ has the meaning 
provided by section 2366a (c)(2) of such title. 
(3) ENTITY.—The term ‘‘entity’’ has the mean-
ing provided by section 2366a(c)(4) of such title. 
(4) MILESTONE B APPROVAL.—The term ‘‘Mile-
stone B approval’’ has the meaning provided by sec-
tion 2366(e)(7) of such title. 
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SEC. 204. CRITICAL COST GROWTH IN MAJOR DEFENSE AC-
QUISITION PROGRAMS. 
(a) AUTHORIZED ACTIONS IN EVENT OF CRITICAL 
COST GROWTH.—Paragraph (2) of section 2433(e) of title 
10, United States Code, is amended to read as follows: 
‘‘(2)(A) If the program acquisition unit cost or pro-
curement unit cost of a major defense acquisition program 
or designated major subprogram (as determined by the 
Secretary under subsection (d)) increases by a percentage 
equal to or greater than the critical cost growth threshold 
for the program or subprogram, the Secretary of Defense, 
after consultation with the Joint Requirements Oversight 
Council regarding program requirements, shall— 
‘‘(i) determine the root cause or causes of the 
critical cost growth including the role, if any, of— 
‘‘(I) changes or growth in requirements; 
‘‘(II) unrealistic baseline estimates; 
‘‘(III) any design, engineering, manufac-
turing, or technology integration issues; 
‘‘(IV) changes in procurement quantities; 
‘‘(V) inadequate program funding or fund-
ing instability; 
‘‘(VI) poor performance by government or 
contractor personnel responsible for program 
management; or 
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‘‘(VII) other causes as identified by the 
Secretary; 
‘‘(ii) subject to subparagraph (B), determine 
whether to terminate such program or to restructure 
such program after assessing— 
‘‘(I) the root causes of cost growth identi-
fied pursuant to subparagraph (A); 
‘‘(II) the validity and urgency of the joint 
military requirement; 
‘‘(III) the viability of the acquisition strat-
egy; 
‘‘(IV) the quality of program management; 
or 
‘‘(V) a broad range of potential material 
and non-material alternatives to such program; 
‘‘(iii) submit the determination made under 
clause (ii) to Congress, before the end of the 60-day 
period beginning on the day the Selected Acquisition 
Report containing the information described in sub-
section (g) is required to be submitted under section 
2432(f) of this title; and 
‘‘(iv) if a report under paragraph (1) has been 
previously submitted to Congress with respect to 
such program or subprogram for the current fiscal 
year but was based upon a different unit cost report 
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from the program manager to the service acquisition 
executive designated by the Secretary concerned, 
submit a further report containing the information 
described in subsection (g), determined from the 
time of the previous report to the time of the cur-
rent report. 
‘‘(B) A program may be restructured pursuant to a 
determination under subparagraph (A)(ii) only if— 
‘‘(i) a written certification (with a supporting 
explanation) is submitted along with the determina-
tion stating that— 
‘‘(I) such program is essential to national 
security; 
‘‘(II) there are no alternatives to such pro-
gram which will provide acceptable military ca-
pability at less cost; 
‘‘(III) new estimates of the program acqui-
sition unit cost or procurement unit cost are 
reasonable; and 
‘‘(IV) the management structure for the 
program is adequate to manage and control 
program acquisition unit cost or procurement 
unit cost; and 
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‘‘(ii) the most recent milestone decision is revis-
ited and results in the approval of such restructured 
program.’’. 
(b) TOTAL EXPENDITURE FOR PROCUREMENT RE-
SULTING IN TREATMENT AS MAJOR DEFENSE ACQUISI-
TION PROGRAM.—Section 2430(a)(2) of such title is 
amended by inserting ‘‘, including all planned increments 
or spirals,’’ after ‘‘an eventual total expenditure for pro-
curement’’. 
(c) 
CONFORMING
AMENDMENTS.—Section 
2433(e)(3) of such title is amended— 
(1) in subparagraph (A), by striking ‘‘or 
(2)(B)’’ and inserting ‘‘or (2)(A)(iii)’’; and 
(2) in subparagraph (B)— 
(A) by striking ‘‘or (2)(B)’’ and inserting 
‘‘or (2)(A)(iii)’’; and 
(B) by striking ‘‘paragraph (2)(A)’’ and 
inserting ‘‘paragraph (2)(B)’’. 
SEC. 205. ORGANIZATIONAL CONFLICTS OF INTEREST IN 
THE ACQUISITION OF MAJOR WEAPON SYS-
TEMS. 
(a) REQUIREMENT FOR PANEL TO PRESENT REC-
OMMENDATIONS.—Not later than one year after the date 
of the enactment of this Act, the Panel on Contracting 
Integrity established pursuant to section 813 of the John 
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Warner National Defense Authorization Act for Fiscal 
Year 2007 (Public Law 109–364; 120 Stat. 2320) shall 
present recommendations to the Secretary of Defense on 
measures to eliminate or mitigate organizational conflicts 
of interest in the acquisition of major weapons systems. 
(b) REVISED REGULATIONS REQUIRED.—Not later 
than 180 days after receiving recommendations pursuant 
to subsection (a), the Secretary of Defense shall revise the 
Defense Supplement to the Federal Acquisition Regula-
tion to address organizational conflicts of interest by con-
tractors in the acquisition of major weapon systems. 
(c) EXTENSION OF PANEL ON CONTRACTING INTEG-
RITY.—Subsection (e) of section 813 of the John Warner 
National Defense Authorization Act (Public Law 109– 
364; 120 Stat. 2321) is amended to read as follows: 
‘‘(e) TERMINATION.—(1) Subject to the restriction in 
paragraph (2), the panel shall continue to serve until the 
date that is 18 months after the date on which the Sec-
retary of Defense notifies the congressional defense com-
mittees of an intention to terminate the panel based on 
a determination that the activities of the panel no longer 
justify its continuation and that concerns about con-
tracting integrity have been fully mitigated. 
‘‘(2) The panel shall continue to serve at least until 
December 31, 2011.’’. 
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