COST, SCHEDULE, AND PERFORMANCE OF MAJOR DEFENSE ACQUISITION PROGRAMS.

SEC. 807. COST, SCHEDULE, AND PERFORMANCE OF MAJOR DEFENSE ACQUISITION PROGRAMS. (a) Cost, Schedule, and Performance of Major Defense Acquisition Programs.— (1) [10 U.S.C. 2448a] In general.—Chapter 144B of title 10, United States Code, as added by section 805, is amended by adding at the end the following new subchapter: “Subchapter III—COST, SCHEDULE, AND PERFORMANCE OF MAJOR DEFENSE ACQUISITION PROGRAMS “Sec. “2448a. Program cost, fielding, and performance goals in planning major defense acquisition programs. “2448b. Independent technical risk assessments. “SEC. 2448a. [10 U.S.C. 2448a] Program cost, fielding, and performance goals in planning major defense acquisition programs “(a) Program Cost and Fielding Targets. (1) Before funds are obligated for technology development, systems development, or production of a major defense acquisition program, the Secretary of Defense shall ensure, by establishing the goals described in paragraph (2), that the milestone decision authority for the major defense acquisition program approves a program that will— “(A) be affordable; “(B) incorporate program planning that anticipates the evolution of capabilities to meet changing threats, technology insertion, and interoperability; and “(C) be fielded when needed. “(2) The goals described in this paragraph are goals for— “(A) the procurement unit cost and sustainment cost (referred to in this section as the ‘program cost targets’); “(B) the date for initial operational capability (referred to in this section as the ‘fielding target’); and “(C) technology maturation, prototyping, and a modular open system approach to evolve system capabilities and improve interoperability. “(b) Delegation. The responsibilities of the Secretary of Defense in subsection (a) may be delegated only to the Deputy Secretary of Defense. “(c) Definitions. In this section: “(1) The term ‘procurement unit cost’ has the meaning provided in section 2432(a)(2) of this title. “(2) The term ‘initial capabilities document’ has the meaning provided in section 2366a(d)(2) of this title. “SEC. 2448b. [10 U.S.C. 2448b] Independent technical risk assessments “(a) In General. With respect to a major defense acquisition program, the Secretary of Defense shall ensure that an independent technical risk assessment is conducted— “(1) before any decision to grant Milestone A approval for the program pursuant to section 2366a of this title, that identifies critical technologies and manufacturing processes that need to be matured; and “(2) before any decision to grant Milestone B approval for the program pursuant to section 2366b of this title, any decision to enter into low-rate initial production or full-rate production, or at any other time considered appropriate by the Secretary, that includes the identification of any critical technologies or manufacturing processes that have not been successfully demonstrated in a relevant environment. “(b) Categorization of Technical Risk Levels. The Secretary shall issue guidance and a framework for categorizing the degree of technical and manufacturing risk in a major defense acquisition program.” . (2) [10 U.S.C. 2448a note] Effective date.—Subchapter III of chapter 144B of title 10, United States Code, as added by paragraph (1), shall apply with respect to major defense acquisition programs that reach Milestone A after October 1, 2017. (b) [10 U.S.C. 2430 note] Modification of Milestone Decision Authority.—Effective January 1, 2017, subsection (d) of section 2430 of title 10, United States Code, as added by section 825(a) of the National Defense Authorization Act for Fiscal Year 2016 (Public Law 114-92; 129 Stat. 907), is amended— (1) in paragraph (2)(A), by inserting “subject to paragraph (5),” before “the Secretary determines”; and (2) by adding at the end the following new paragraph: “(5) The authority of the Secretary of Defense to designate an alternative milestone decision authority for a program with respect to which the Secretary determines that the program is addressing a joint requirement, as set forth in paragraph (2)(A), shall apply only for a major defense acquisition program that reaches Milestone A after October 1, 2016, and before October 1, 2019.” . (c) Adherence to Requirements in Major Defense Acquisition Programs.—Section 2547 of title 10, United States Code, is amended— (1) by redesignating subsections (b) and (c) as subsections (c) and (d), respectively; (2) by inserting after subsection (a) the following new subsection (b): “(b) Adherence to Requirements in Major Defense Acquisition Programs. The Secretary of the military department concerned shall ensure that the program capability document supporting a Milestone B or subsequent decision for a major defense acquisition program may not be approved until the chief of the armed force concerned determines in writing that the requirements in the document are necessary and realistic in relation to the program cost and fielding targets established under section 2448a(a) of this title.” ; and (3) by adding at the end of subsection (d), as so redesignated, the following new paragraph: “(3) The term ‘program capability document’ has the meaning provided in section 2446a(b)(5) of this title.” . (d) Amendment Relating to Determination Required Before Milestone A Approval.—Section 2366a(b)(4) of title 10, United States Code, is amended by inserting after “areas of risk” the following: “, including risks determined by the identification of critical technologies required under section 2448b(a)(1) of this title or any other risk assessment”. (e) Amendment Relating to Certification Required Before Milestone B Approval.—Section 2366b(a) of title 10, United States Code, is amended— (1) in paragraph (2), by striking “assessment by the Assistant Secretary” and all that follows through “Test and Evaluation” and inserting “technical risk assessment conducted under section 2448b of this title”; and (2) in paragraph (3), as amended by section 805(a)(3)(B)— (A) by striking “and” at the end of subparagraph (C); (B) by redesignating subparagraphs (D) through (M) as subparagraphs (E) through (N), respectively; and (C) by inserting after subparagraph (C) the following new subparagraph (D): “(D) the estimated procurement unit cost for the program and the estimated date for initial operational capability for the baseline description for the program (established under section 2435) do not exceed the program cost and fielding targets established under section 2448a(a) of this title, or, if such estimated cost is higher than the program cost targets or if such estimated date is later than the fielding target, the program cost targets have been increased or the fielding target has been delayed by the Secretary of Defense after a request for such increase or delay by the milestone decision authority;” .