ELIMINATION OF COST UNDERRUNS AS FACTOR IN CALCULATION OF PENALTIES FOR COST OVERRUNS.

SEC. 825. ELIMINATION OF COST UNDERRUNS AS FACTOR IN CALCULATION OF PENALTIES FOR COST OVERRUNS. Section 828 of the National Defense Authorization Act for Fiscal Year 2016 (Public Law 114-92; 10 U.S.C. 2430 note) is amended— (1) in subsection (a), by striking “each fiscal year beginning with fiscal year 2015” and inserting “each of fiscal years 2018 through 2022”; (2) in subsection (b)— (A) in paragraph (1), by striking “or underrun”; (B) in paragraph (2)— (i) by striking “or underruns”; and (ii) by striking “,Technology, and Logistics” and inserting “and Sustainment”; (C) in paragraph (3)— (i) by striking “and cost underruns”; and (ii) by striking “or underruns”; and (D) in paragraph (4), by striking “, except that the cost overrun penalty may not be a negative amount”; (3) by redesignating subsections (c) and (d) as subsections (d) and (e), respectively; (4) by inserting after subsection (b) the following new subsection: “(c) Total Cost Overrun Penalty. Notwithstanding the amount of a cost overrun penalty determined in (b), the total cost overrun penalty for a military department (including any cost overrun penalty for joint programs of military departments) for a fiscal year may not exceed $50,000,000.” ; and (5) in subsection (d) (as so redesignated)— (A) in paragraph (1)— (i) in the paragraph heading, by inserting “or procurement” after “evaluation”; (ii) by striking “each fiscal year beginning with fiscal year 2015” and inserting “each of fiscal years 2018 through 2022”; (iii) by striking “each research” and inserting “the research”; (iv) by striking “evaluation account” and inserting “evaluation or procurement accounts”; and (v) by striking “percentage” and inserting “amount”; and (B) in paragraph (2)— (i) in the paragraph heading, by striking “amount” and inserting “amounts”; (ii) by striking “percentage reduction” and inserting “reductions”; (iii) by striking “evaluation accounts” and inserting “evaluation or procurement accounts”; (iv) by striking “paragraph (1) is the percentage reduction” and inserting “paragraph (1) are the reductions”; and (v) by inserting “, when combined,” after “equal”.