10 U.S.C. § 3507 (ARMED FORCES)
§ 3507. Department of defense contracts: defense acquisitions specifically authorized by law
(a) Limitation.—
In the case of the Department of Defense, a multiyear contract in an amount equal to or greater than $500,000,000 may not be entered into under this subchapter unless the contract is specifically authorized by law in an Act other than an appropriations Act.
(b) Matters to Be Included in Request for Authorization.—
In submitting a request for a specific authorization by law to carry out a defense acquisition program using multiyear contract authority under this subchapter, the Secretary of Defense shall include in the request the following:
(1) A report containing preliminary findings of the agency head required in paragraphs (1) through (6) of section 3501(a) of this title, together with the basis for such findings.
(2) Confirmation that the preliminary findings of the agency head under paragraph (1) were supported by a preliminary cost analysis performed by the Director of Cost Assessment and Program Evaluation.
(c) Required Certification.—
A multiyear contract may not be entered into under this subchapter for a defense acquisition program that has been specifically authorized by law to be carried out using multiyear contract authority unless the Secretary of Defense certifies in writing, not later than 30 days before entry into the contract, that each of the following conditions is satisfied:
(1) The Secretary has determined that each of the requirements in paragraphs (1) through (6) of section 3501(a) of this title will be met by such contract and has provided the basis for such determination to the congressional defense committees.
(2) The Secretary’s determination under subparagraph (A) was made after completion of a cost analysis conducted on the basis of section 3226(b) of this title, and the analysis supports the determination.
(3) The system being acquired pursuant to such contract has not been determined to have experienced cost growth in excess of the critical cost growth threshold pursuant to section 4374 of this title within 5 years prior to the date the Secretary anticipates such contract (or a contract for advance procurement entered into consistent with the authorization for such contract) will be awarded.
(4) A sufficient number of end items of the system being acquired under such contract have been delivered at or within the most current estimates of the program acquisition unit cost or procurement unit cost for such system to determine that current estimates of such unit costs are realistic.
(5) During the fiscal year in which such contract is to be awarded, sufficient funds will be available to perform the contract in such fiscal year, and the future-years defense program for such fiscal year will include the funding required to execute the program without cancellation.
(6) The contract is a fixed price type contract.
(7) The proposed multiyear contract provides for production at not less than minimum economic rates given the existing tooling and facilities.
(d) Authority When One or More Conditions Not Met.—
The Secretary may make the certification under subsection (c) notwithstanding the fact that one or more of the conditions of such certification are not met, if—
(1) the Secretary determines that, due to exceptional circumstances, proceeding with a multiyear contract under this section is in the best interest of the Department of Defense; and
(2) the Secretary provides the basis for such determination with the certification.
(e) Limitation on Delegation.—
The Secretary may not delegate the authority to make the certification under subsection (c) or the determination under subsection (d) to an official below the level of Under Secretary of Defense for Acquisition and Sustainment.
(f) Requests for Relief From Specified Cost Savings.—
If for any fiscal year a multiyear contract to be entered into under this subchapter is authorized by law for a particular procurement program and that authorization is subject to certain conditions established by law (including a condition as to cost savings to be achieved under the multiyear contract in comparison to specified other contracts) and if it appears (after negotiations with contractors) that such savings cannot be achieved, but that significant savings could nevertheless be achieved through the use of a multiyear contract rather than specified other contracts, the President may submit to Congress a request for relief from the specified cost savings that must be achieved through multiyear contracting for that program. Any such request by the President shall include details about the request for a multiyear contract, including details about the negotiated contract terms and conditions.
(g) Procurement of Complete and Usable End Items.—
(1) In general.—
The Secretary may obligate funds for procurement of an end item under a multiyear contract for the purchase of property only for procurement of a complete and usable end item.
(2) Long-lead items.—
The Secretary may obligate funds appropriated for any fiscal year for advance procurement under a contract for the purchase of property only for the procurement of those long-lead items necessary in order to meet a planned delivery schedule for complete major end items that are programmed under the contract to be acquired with funds appropriated for a subsequent fiscal year (including an economic order quantity of such long-lead items when authorized by law).