H.R. 4228 — Referred from Senate

IIB 113th CONGRESS 2d Session H. R. 4228 IN THE SENATE OF THE UNITED STATES June 10, 2014Received; read twice and referred to the Committee on Homeland Security and Governmental Affairs AN ACT To require the Department of Homeland Security to improve discipline, accountability, and transparency in acquisition program management. 1. Short title This Act may be cited as the DHS Acquisition Accountability and Efficiency Act. 2. Table of contents The table of contents for this Act is as follows: Sec. 1. Short title. Sec. 2. Table of contents. Sec. 3. Findings. Sec. 4. Definitions. Sec. 5. Prohibition on additional authorization of appropriations. Title I—Acquisition Authorities Sec. 101. Acquisition authorities for Under Secretary for Management. Sec. 102. Acquisition authorities for Chief Financial Officer. Sec. 103. Acquisition authorities for Chief Information Officer. Sec. 104. Chief Procurement Officer. Sec. 105. Requirements to ensure greater accountability for acquisition programs. Title II—Acquisition Program Management Discipline Sec. 201. Acquisition Review Board. Sec. 202. Requirements to reduce duplication in acquisition programs. Sec. 203. Government Accountability Office review of Board and of requirements to reduce duplication in acquisition programs. Sec. 204. Excluded Party List System waivers. Sec. 205. Inspector General oversight of suspension and debarment. Title III—Acquisition Program Management Accountability and Transparency Sec. 301. Congressional notification and other requirements for major acquisition program breach. Sec. 302. Multiyear acquisition strategy. Sec. 303. Acquisition reports. Sec. 304. Government Accountability Office review of multiyear acquisition strategy. Sec. 305. Office of Inspector General report. 3. Findings Congress finds the following: (1) The Department of Homeland Security does not consistently implement its policies and Government and private sector best practices for acquisitions and procurement. (2) It is difficult to determine the cost of the Department’s major acquisition programs because the Department has not provided consistent, comparable updates on an annual basis. As of January 2014, the Department identified over 80 major acquisition programs costing over $300,000,000, and, based on 2011, estimates it plans to spend about $170,000,000,000 in the future on major acquisition programs. (3) Since 2005, the Government Accountability Office has placed Department acquisition management activities on its High-Risk List, which identifies Government operations that have greater susceptibility to fraud, waste, abuse, and mismanagement or greater need for transformation to address economy, efficiency, or effectiveness challenges. (4) While the Department has taken actions to address some high-risk acquisition program management issues, many programs continue to experience challenges with funding instability, workforce shortfalls, reliable cost estimates, realistic schedules, agreed-upon baseline objectives, and consistent and reliable data needed to accurately measure program performance. (5) Of the 77 Department major acquisition programs in 2011, the Government Accountability Office identified 42 programs that experienced cost growth, schedule slips, or both. The Department reported that the magnitude of the cost growth for 16 of the 42 programs, which increased from almost $20,000,000,000 to over $50,000,000,000 in 2011, had an aggregate increase of 166 percent. (6) In 2012, the Government Accountability Office found that only 20 of 63 programs had Department-approved acquisition program baselines. The Government Accountability Office also reported that the Department planned to spend more than $105 billion on programs lacking acquisition program baselines. 4. Definitions (a) In general In this Act: (1) Secretary The term Secretary means the Secretary of Homeland Security. (2) Department The term Department means the Department of Homeland Security. (3) Congressional homeland security committees The term congressional homeland security committees means— (A) the Committee on Homeland Security of the House of Representatives and the Committee on Homeland Security and Governmental Affairs of the Senate; and (B) the Committee on Appropriations of the House of Representatives and of the Senate. (b) Additional definitions In this Act: (1) Acquisition The term acquisition has the meaning provided in section 131 of title 41, United States Code. (2) Best practices The term best practices, with respect to acquisition, means a knowledge-based approach to capability development that includes identifying and validating needs; assessing alternatives to select the most appropriate solution; clearly establishing well-defined requirements; developing realistic cost assessments and schedules; securing stable funding that matches resources to requirements; demonstrating technology, design, and manufacturing maturity; using milestones and exit criteria or specific accomplishments that demonstrate progress; adopting and executing standardized processes with known success across programs; establishing an adequate workforce that is qualified and sufficient to perform necessary functions; and integrating these capabilities into the Department’s mission and business operations. (c) Amendments to definitions in homeland security act of 2002 Section 2 of the Homeland Security Act of 2002 is amended— (1) by striking In this Act, and inserting (a) In General.—In this Act,; (2) in paragraph (2)— (A) by inserting (A) after (2); and (B) by adding at the end the following new subparagraph: (B) The term congressional homeland security committees means— (i) the Committee on Homeland Security of the House of Representatives and the Committee on Homeland Security and Governmental Affairs of the Senate; and (ii) the Committee on Appropriations of the House of Representatives and of the Senate, where appropriate. ; and (3) by adding at the end the following new subsection: (b) Acquisition-Related definitions In this Act, the following definitions apply: (1) Acquisition The term acquisition has the meaning provided in section 131 of title 41, United States Code. (2) Acquisition decision authority The term acquisition decision authority means the authority, held by the Secretary acting through the Deputy Secretary or Under Secretary for Management— (A) to ensure compliance with Federal law, the Federal Acquisition Regulation, and Department acquisition management directives; (B) to review (including approving, halting, modifying, or cancelling) an acquisition program through the life cycle of the program; (C) to ensure that program managers have the resources necessary to successfully execute an approved acquisition program; and (D) to ensure good program management of cost, schedule, risk, and system performance of the acquisition, including assessing acquisition program baseline breaches and directing any corrective action for such breaches. (3) Acquisition decision event The term acquisition decision event, with respect to an investment or acquisition program, means a predetermined point within the acquisition phases of the investment or acquisition program at which the investment or acquisition program will undergo a review prior to commencement of the next phase. (4) Acquisition decision memorandum The term acquisition decision memorandum, with respect to an acquisition, means the official acquisition decision event record that includes a documented record of decisions, exit criteria, and assigned actions for the acquisition as determined by the person exercising acquisition decision authority for the acquisition. (5) Acquisition program baseline The term acquisition program baseline, with respect to an acquisition program, means a summary of the cost, schedule, and performance parameters, expressed in standard, measurable, quantitative terms, which must be met in order to accomplish the goals of the program. (6) Capability development plan The term capability development plan, with respect to a proposed acquisition, means the document that the Acquisition Review Board approves for the first acquisition decision event related to validating the need of a proposed acquisition. (7) Component acquisition executive The term Component Acquisition Executive means the senior acquisition official within a Component who is designated in writing by the Under Secretary for Management, in consultation with the Component head, with authority and responsibility for leading a process and staff to provide acquisition and program management oversight, policy, and guidance to ensure that statutory, regulatory, and higher level policy requirements are fulfilled, including compliance with Federal law, the Federal Acquisition Regulation, and Department acquisition management directives established by the Under Secretary for Management. (8) Life cycle cost The term life cycle cost, with respect to an acquisition program, means all costs associated with research, development, procurement, operation, integrated logistics support, and disposal under the program, including supporting infrastructure that plans, manages, and executes the program over its full life, and costs of common support items incurred as a result of the program. (9) Major acquisition program The term major acquisition program means a Department acquisition program that is estimated by the Secretary to require an eventual total expenditure of at least $300,000,000 (based on fiscal year 2014 constant dollars) over its life cycle cost. . 5. Prohibition on additional authorization of appropriations No additional funds are authorized to be appropriated to carry out this Act and the amendments made by this Act. This Act and such amendments shall be carried out using amounts otherwise available for such purposes. I Acquisition Authorities 101. Acquisition authorities for Under Secretary for Management Section 701 of the Homeland Security Act of 2002 (6 U.S.C. 341) is amended— (1) in subsection (a)(2), by striking Procurement and inserting Acquisition and procurement; and (2) by adding at the end the following: (d) Acquisition and related responsibilities (1) In general Notwithstanding section 1702(b) of title 41, United States Code, the Under Secretary for Management is the Chief Acquisition Officer of the Department. As Chief Acquisition Officer, the Under Secretary shall have the authority and perform the functions as specified in section 1702(b) of such title, and perform all other functions and responsibilities delegated by the Secretary or described in this subsection. (2) Duties and responsibilities In addition to the authority and functions specified in section 1702(b) of title 41, United States Code, the duties and responsibilities of the Under Secretary for Management related to acquisition include the following: (A) Advising the Secretary regarding acquisition management activities, taking into account risks of failure to achieve cost, schedule, or performance parameters, to ensure that the Department achieves its mission through the adoption of widely accepted program management best practices and standards. (B) Exercising the acquisition decision authority to approve, halt, modify (including the rescission of approvals of program milestones), or cancel major acquisition programs, unless the Under Secretary delegates the authority to a Component Acquisition Executive pursuant to paragraph (3). (C) Establishing policies for acquisition that implement an approach that takes into account risks of failure to achieve cost, schedule, or performance parameters that all Components of the Department shall comply with, including outlining relevant authorities for program managers to effectively manage acquisition programs. (D) Ensuring that each major acquisition program has a Department-approved acquisition program baseline. (E) Ensuring that the heads of Components and Component Acquisition Executives comply with Federal law, the Federal Acquisition Regulation, and Department acquisition management directives. (F) Ensuring that grants and financial assistance are provided only to individuals and organizations that are not suspended or debarred. (G) Distributing guidance throughout the Department to ensure that contractors involved in acquisitions, particularly companies that access the Department’s information systems and technologies, adhere to internal cybersecurity policies established by the Department of Homeland Security. (3) Delegation of acquisition decision authority (A) Level 3 acquisitions The Under Secretary for Management may delegate acquisition decision authority in writing to the relevant Component Acquisition Executive for an acquisition program that has a life cycle cost estimate of less than $300,000,000. (B) Level 2 acquisitions The Under Secretary for Management may delegate acquisition decision authority in writing to the relevant Component Acquisition Executive for a major acquisition program that has a life cycle cost estimate of at least $300,000,000 but not more than $1,000,000,000 if all of the following requirements are met: (i) The Component concerned possesses working policies, processes, and procedures that are consistent with Department-level acquisition policy. (ii) The Component Acquisition Executive has adequate, experienced, dedicated program management professional staff commensurate with the size of the delegated portfolio. (iii) Each major acquisition program concerned has written documentation showing that it has a Department-approved acquisition program baseline and it is meeting agreed-upon cost, schedule, and performance thresholds. (4) Excluded parties list system consultation The Under Secretary for Management shall require that all Department contracting and procurement officials consult the Excluded Parties List System (or successor system) as maintained by the General Services Administration prior to awarding a contract or grant or entering into other transactions to ascertain whether the selected contractor is excluded from receiving Federal contracts, certain subcontracts, and certain types of Federal financial and non-financial assistance and benefits. (5) Relationship to under secretary for science and technology Nothing in this subsection shall diminish the authority granted to the Under Secretary for Science and Technology under this Act. The Under Secretary for Management and the Under Secretary for Science and Technology shall cooperate in matters related to the coordination of acquisitions across the Department so that investments of the Directorate of Science and Technology can support current and future requirements of the Components. . 102. Acquisition authorities for Chief Financial Officer Section 702 of the Homeland Security Act of 2002 (6 U.S.C. 342) is amended by adding at the end of subsection (b)(2) the following new subparagraph: (J) Notwithstanding section 902 of title 31, United States Code, provide leadership over financial management policy and programs for the Department as they relate to the Department’s acquisitions programs, in consultation with the Under Secretary for Management. . 103. Acquisition authorities for Chief Information Officer Section 703 of the Homeland Security Act of 2002 (6 U.S.C. 343) is amended by adding at the end the following new subsection: (c) Acquisition responsibilities Notwithstanding section 11315 of title 40, United States Code, the acquisition responsibilities of the Chief Information Officer, in consultation with the Under Secretary for Management, shall include the following: (1) Serve as the lead technical authority for information technology programs and establish departmental information technology priorities, policies, processes, standards, guidelines, and procedures. (2) Oversee the management of the Homeland Security Enterprise Architecture and ensure that, before each acquisition decision event, approved information technology acquisitions comply with departmental information technology management processes, technical requirements, and the Homeland Security Enterprise Architecture, and in any case in which information technology acquisitions do not comply with Departmental management directives, make recommendations to the Acquisition Review Board regarding such noncompliance. (3) Be responsible for providing recommendations to the Acquisition Review Board established in section 836 of this Act on information technology programs, and be responsible for developing information technology acquisition strategic guidance. . 104. Chief Procurement Officer (a) In general Title VII of the Homeland Security Act of 2002 (6 U.S.C. 341 et seq.) is amended by adding at the end the following new section: 708. Chief Procurement Officer (a) In general There is a Chief Procurement Officer of the Department, who shall report directly to the Under Secretary for Management. The Chief Procurement Officer is the senior procurement executive for purposes of section 1702(c) of title 41, United States Code, and shall perform procurement functions as specified in such section. The Chief Procurement Officer also shall perform other functions and responsibilities set forth in this section and as may be assigned by the Under Secretary for Management. (b) Responsibilities The Chief Procurement Officer shall— (1) exercise leadership and authority to the extent delegated by the Under Secretary for Management over the Department procurement function; (2) issue acquisition regulations and policies; (3) account for the integrity, performance, and oversight of Department procurement and contracting functions and be responsible for ensuring that a procurement’s contracting strategy and plans are consistent with the intent and direction of the Acquisition Review Board established in section 836 of this Act; (4) serve as the Department’s business advisor and main liaison to industry on procurement-related issues by providing advice on industry engagement, acquisition policy, oversight of the procurement function, and development of the acquisition workforce; (5) oversee a centralized certification and training program, in consultation with the Under Secretary for Management, for the entire Department acquisition workforce while using, to the greatest extent practicable, best practices and acquisitions training opportunities already in existence within the Federal Government, the private sector, or universities and colleges, as appropriate, and including training on how best to identify actions that warrant referrals for suspension or debarment; (6) delegate or retain contracting authority, as appropriate, except as provided in section 701(d)(3) of this Act; (7) participate in the selection, and periodic performance review, of the head of each contracting activity within the Department; (8) collect baseline data and establish performance measures on the impact of strategic sourcing initiatives on the private sector, including, in particular, small businesses; and (9) ensure that a fair proportion (as defined pursuant to the Small Business Act (15 U.S.C. 631 et seq.)) of Federal contract and subcontract dollars are awarded to small businesses, maximize opportunities for small business participation, and ensure, to the extent practicable, small businesses that achieve qualified vendor status for security-related technologies are provided an opportunity to compete for contracts for such technology. . (b) Clerical amendment The table of contents in section 1(b) of the Homeland Security Act of 2002 (6 U.S.C. 101 et seq.) is amended by adding after the item relating to section 707 the following new item: Sec. 708. Chief Procurement Officer. . 105. Requirements to ensure greater accountability for acquisition programs (a) In general Title VII of the Homeland Security Act of 2002 (6 U.S.C. 341 et seq.) is further amended by adding at the end the following new section: 709. Requirements to ensure greater accountability for acquisition programs (a) Requirement To establish mechanism Within the Management Directorate, the Under Secretary for Management shall establish a mechanism to prioritize improving the accountability, standardization, and transparency of major acquisition programs of the Department in order to increase opportunities for effectiveness and efficiencies and to serve as the central oversight function of all Department acquisition programs. (b) Responsibilities of executive director The Under Secretary for Management shall designate an Executive Director to oversee the requirement under subsection (a). The Executive Director shall report directly to the Under Secretary and shall carry out the following responsibilities: (1) Monitor the performance of Department acquisition programs regularly between acquisition decision events to identify problems with cost, performance, or schedule that Components may need to address to prevent cost overruns, performance issues, or schedule delays. (2) Assist the Chief Acquisition Officer in managing the Department’s acquisition portfolio. (3) Conduct oversight of individual acquisition programs to implement Department acquisition program policy, procedures, and guidance with a priority on ensuring the data it collects and maintains from its Components is accurate and reliable. (4) Serve as the focal point within the Department for policy, process, and procedure regarding life cycle cost estimating and analysis. (5) Serve as the focal point and coordinator for the acquisition life cycle review process and as the executive secretariat for the Acquisition Review Board established under section 836 of this Act. (6) Advise the persons having acquisition decision authority in making acquisition decisions consistent with all applicable laws and in establishing clear lines of authority, accountability, and responsibility for acquisition decisionmaking within the Department. (7) Engage in the strategic planning and performance evaluation process required under section 306 of title 5, United States Code, and sections 1105(a)(28), 1115, 1116, and 9703 of title 31, United States Code, by supporting the Chief Procurement Officer in developing strategies and specific plans for hiring, training, and professional development in order to rectify any deficiency within the Department’s acquisition workforce. (8) Oversee the Component Acquisition Executive structure to ensure it has sufficient capabilities and complies with Department policies. (9) Develop standardized certification standards in consultation with the Component Acquisition Executives for all acquisition program managers. (10) In the event that a program manager’s certification or actions need review for purposes of promotion or removal, provide input, in consultation with the relevant Component Acquisition Executive, into the relevant program manager’s performance evaluation, and report positive or negative experiences to the relevant certifying authority. (11) Provide technical support and assistance to Department acquisitions and acquisition personnel in conjunction with the Chief Procurement Officer. (12) Prepare the Department’s Comprehensive Acquisition Status Report, as required by the Department of Homeland Security Appropriations Act, 2013 (division D of Public Law 113–6; 127 Stat. 343) and section 840 of this Act, and make such report available to congressional homeland security committees. (13) Prepare the Department’s Quarterly Program Accountability Report as required by section 840 of this Act, and make such report available to the congressional homeland security committees. (c) Responsibilities of components Each head of a Component shall comply with Federal law, the Federal Acquisition Regulation, and Department acquisition management directives established by the Under Secretary for Management. For each major acquisition program, each head of a Component shall— (1) establish a complete life cycle cost estimate with supporting documentation, including an acquisition program baseline; (2) verify each life cycle cost estimate against independent cost estimates, and reconcile any differences; (3) complete a cost-benefit analysis with supporting documentation; (4) develop and maintain a schedule that is consistent with scheduling best practices as identified by the Comptroller General of the United States, including, in appropriate cases, an integrated master schedule; and (5) ensure that all acquisition program information provided by the Component is complete, accurate, timely, and valid. . (b) Clerical amendment The table of contents in section 1(b) of the Homeland Security Act of 2002 (6 U.S.C. 101 et seq.) is further amended by adding after the item relating to section 708 the following new item: Sec. 709. Requirements to ensure greater accountability for acquisition programs. . II Acquisition Program Management Discipline 201. Acquisition Review Board (a) In general Subtitle D of title VIII of the Homeland Security Act of 2002 (6 U.S.C. 391 et seq.) is amended by adding at the end the following new section: 836. Acquisition Review Board (a) In general The Secretary shall establish an Acquisition Review Board (in this section referred to as the Board) to strengthen accountability and uniformity within the Department acquisition review process, review major acquisition programs, and review the use of best practices. (b) Composition The Deputy Secretary or Under Secretary for Management shall serve as chair of the Board. The Secretary shall also ensure participation by other relevant Department officials, including at least two Component heads or their designees, as permanent members of the Board. (c) Meetings The Board shall meet every time a major acquisition program needs authorization to proceed from acquisition decision events through the acquisition life cycle and to consider any major acquisition program in breach as necessary. The Board may also be convened for non-major acquisitions that are deemed high-risk by the Executive Director referred to in section 709(b) of this Act. The Board shall also meet regularly for purposes of ensuring all acquisitions processes proceed in a timely fashion to achieve mission readiness. (d) Responsibilities The responsibilities of the Board are as follows: (1) Determine whether a proposed acquisition has met the requirements of key phases of the acquisition life cycle framework and is able to proceed to the next phase and eventual full production and deployment. (2) Oversee executable business strategy, resources, management, accountability, and alignment to strategic initiatives. (3) Support the person with acquisition decision authority for an acquisition in determining the appropriate direction for the acquisition at key acquisition decision events. (4) Conduct systematic reviews of acquisitions to ensure that they are progressing in compliance with the approved documents for their current acquisition phase. (5) Validate the acquisition documents of each major acquisition program, including the acquisition program baseline, to ensure the reliability of underlying data. (6) Ensure that practices are adopted and implemented to require consideration of trade-offs among cost, schedule, and performance objectives as part of the process for developing requirements for major acquisition programs prior to the initiation of the capability development plan, second acquisition decision event, including, at a minimum, the following practices: (A) Department officials responsible for acquisition, budget, and cost estimating functions are provided with the appropriate opportunity to develop estimates and raise cost and schedule matters before performance objectives are established for capabilities when feasible. (B) Full consideration of possible trade-offs among cost, schedule, and performance objectives for each alternative is considered. (e) Acquisition program baseline report requirement If the person exercising acquisition decision authority over a major acquisition program approves the program to proceed beyond the acquisition decision event requiring a capability development plan before it has a Department-approved acquisition program baseline, then the Under Secretary for Management shall create and approve an acquisition program baseline report on the decision, and the Secretary shall— (1) within seven days after an acquisition decision memorandum is signed, notify in writing the congressional homeland security committees of such decision; and (2) within 60 days after the acquisition decision memorandum is signed, submit a report to such committees stating the rationale for the decision and a plan of action to require an acquisition program baseline for the program. (f) Best practices defined In this section, the term best practices has the meaning provided in section 4(b) of the DHS Acquisition Accountability and Efficiency Act. . (b) Clerical amendment The table of contents in section 1(b) of the Homeland Security Act of 2002 (6 U.S.C. 101 et seq.) is further amended by adding after the item relating to section 835 the following new item: Sec. 836. Acquisition Review Board. . 202. Requirements to reduce duplication in acquisition programs (a) In general Subtitle D of title VIII of the Homeland Security Act of 2002 (6 U.S.C. 391 et seq.) is further amended by adding at the end the following new section: 837. Requirements to reduce duplication in acquisition programs (a) Requirement To establish policies In an effort to reduce duplication and inefficiency for all Department investments, including major acquisition programs, the Deputy Secretary, in consultation with the Under Secretary for Management, shall establish Department-wide policies to integrate all phases of the investment life cycle and help the Department identify, validate, and prioritize standards for common Component requirements for major acquisition program requirements in order to increase opportunities for effectiveness and efficiencies. The policies shall also include strategic alternatives for developing and facilitating a Department Component-driven requirements process that includes oversight of a development test and evaluation capability; identification of priority gaps and overlaps in Department capability needs; and provision of feasible technical alternatives, including innovative commercially available alternatives, to meet capability needs. (b) Mechanisms To carry out requirement The Deputy Secretary, in consultation with the Under Secretary for Management, shall coordinate the actions necessary to carry out subsection (a), using such mechanisms as considered necessary by the Secretary to help the Department reduce duplication and inefficiency for all Department investments, including major acquisition programs. (c) Coordination In coordinating the actions necessary to carry out subsection (a), the Deputy Secretary shall consult with the Under Secretary for Management, Component Acquisition Executives, and any other Department officials, including the Under Secretary for Science and Technology or his designee, with specific knowledge of Department or Component acquisition capabilities to prevent unnecessary duplication of requirements. (d) Advisors The Deputy Secretary, in consultation with the Under Secretary for Management, shall seek and consider input within legal and ethical boundaries from members of Federal, State, local, and tribal governments, nonprofit organizations, and the private sector, as appropriate, on matters within their authority and expertise in carrying out the Department’s mission. (e) Meetings The Deputy Secretary, in consultation with the Under Secretary for Management, shall meet at least quarterly and communicate with Components often to ensure that Components do not overlap or duplicate spending or priorities on major investments and acquisition programs within their areas of responsibility. (f) Responsibilities In carrying out this section, the responsibilities of the Deputy Secretary are as follows: (1) To review and validate the requirements documents of major investments and acquisition programs prior to acquisition decision events of the investments or programs. (2) To ensure the requirements and scope of a major investment or acquisition program are stable, measurable, achievable, at an acceptable risk level, and match the resources planned to be available. (3) Before any entity of the Department issues a solicitation for a new contract, coordinate with other Department entities as appropriate to prevent duplication and inefficiency and— (A) to implement portfolio reviews to identify common mission requirements and crosscutting opportunities among Components to harmonize investments and requirements and prevent overlap and duplication among Components; and (B) to the extent practicable, to standardize equipment purchases, streamline the acquisition process, improve efficiencies, and conduct best practices for strategic sourcing. (4) To ensure program managers of major investments and acquisition programs conduct analyses, giving particular attention to factors such as cost, schedule, risk, performance, and operational efficiency in order to determine that programs work as intended within cost and budget expectations. (5) To propose schedules for delivery of the operational capability needed to meet each Department investment and major acquisition program. (g) Best practices defined In this section, the term best practices has the meaning provided in section 4(b) of the DHS Acquisition Accountability and Efficiency Act. . (b) Clerical amendment The table of contents in section 1(b) of the Homeland Security Act of 2002 (6 U.S.C. 101 et seq.) is further amended by adding after the item relating to section 836 the following new item: Sec. 837. Requirements to reduce duplication in acquisition programs. . 203. Government Accountability Office review of Board and of requirements to reduce duplication in acquisition programs (a) Review required The Comptroller General of the United States shall conduct a review of the effectiveness of the Acquisition Review Board established under section 836 of the Homeland Security Act of 2002 (as added by section 201) and the requirements to reduce duplication in acquisition programs established under section 837 of such Act (as added by section 202) in improving the Department’s acquisition management process. (b) Scope of report The review shall include the following: (1) An assessment of the effectiveness of the Department in increasing program management oversight, best practices and standards, and discipline among the Components of the Department, including in working together and in preventing overlap and duplication. (2) An assessment of the effectiveness of the Department in instilling program management discipline. (3) A statement of how regularly each major acquisition program is reviewed by the Board, how often the Board stops major acquisition programs from moving forward in the phases of the acquisition life cycle process, and the number of major acquisition programs that have been halted because of problems with operational effectiveness, schedule delays, or cost overruns. (c) Report required The Comptroller General shall submit to the congressional homeland security committees a report on the review required by this section not later than one year after the date of the enactment of this Act. The report shall be submitted in unclassified form but may include a classified annex. 204. Excluded Party List System waivers The Secretary of Homeland Security shall provide notification to the congressional homeland security committees within five days after the issuance of a waiver by the Secretary of Federal requirements that an agency not engage in business with a contractor in the Excluded Party List System (or successor system) as maintained by the General Services Administration and an explanation for a finding by the Secretary that a compelling reason exists for this action. 205. Inspector General oversight of suspension and debarment The Inspector General of the Department of Homeland Security— (1) may audit decisions about grant and procurement awards to identify instances where a contract or grant was improperly awarded to a suspended or debarred entity and whether corrective actions were taken to prevent recurrence; and (2) shall review the suspension and debarment program throughout the Department of Homeland Security to assess whether suspension and debarment criteria are consistently applied throughout the Department and whether disparities exist in the application of such criteria, particularly with respect to business size and categories. III Acquisition Program Management Accountability and Transparency 301. Congressional notification and other requirements for major acquisition program breach (a) In general Subtitle D of title VIII of the Homeland Security Act of 2002 (6 U.S.C. 391 et seq.) is further amended by adding at the end the following new section: 838. Congressional notification and other requirements for major acquisition program breach (a) Breach defined The term breach, with respect to a major acquisition program, means a failure to meet any cost, schedule, or performance parameter specified in the acquisition program baseline. (b) Requirements within department if breach occurs (1) Notifications (A) Notification of potential breach If a major acquisition program has a potential for a future breach, as determined by the program manager for that program, the program manager shall notify the person exercising acquisition decision authority for the program. (B) Notification of actual breach If an actual breach occurs in a major acquisition program, the program manager for that program shall notify the head of the Component concerned, the Component Acquisition Executive for the program, the Executive Director referred to in section 709(b) of this Act, the Under Secretary for Management, and the Deputy Secretary. (C) Notification to secretary If a major acquisition program has an actual breach with a cost overrun greater than 20 percent or a schedule delay greater than 12 months from the costs or schedule set forth in the acquisition program baseline for the program, the Secretary and the Inspector General of the Department shall be notified not later than five business days after the actual breach is identified. (2) Remediation plan and root cause analysis (A) In general In the case of an actual breach with a cost overrun greater than 15 percent or a schedule delay greater than 180 days from the costs or schedule set forth in the acquisition program baseline, a remediation plan and root cause analysis is required, and the Under Secretary for Management or his designee shall establish a date for submission within the Department of a breach remediation plan and root cause analysis in accordance with this subsection. (B) Remediation plan The remediation plan required under this subsection shall be submitted in writing to the head of the Component concerned, the Executive Director referred to in section 709(b) of this Act, and the Under Secretary for Management. The plan shall— (i) explain the circumstances of the breach; (ii) provide prior cost estimating information; (iii) propose corrective action to control cost growth, schedule delays, or performance issues; (iv) in coordination with Component Acquisition Executive, discuss all options considered, including the estimated impact on cost, schedule, or performance of the program if no changes are made to current requirements, the estimated cost of the program if requirements are modified, and the extent to which funding from other programs will need to be reduced to cover the cost growth of the program; and (v) explain the rationale for why the proposed corrective action is recommended. (C) Root cause analysis The root cause analysis required under this subsection shall determine the underlying cause or causes of shortcomings in cost, schedule, or performance of the program, including the role, if any, of the following: (i) Unrealistic performance expectations. (ii) Unrealistic baseline estimates for cost or schedule or changes in program requirements. (iii) Immature technologies or excessive manufacturing or integration risk. (iv) Unanticipated design, engineering, manufacturing, or technology integration issues arising during program performance. (v) Changes in procurement quantities. (vi) Inadequate program funding or changes in planned out-year funding from one five-year funding plan to the next five-year funding plan as outlined in the Future Years Homeland Security Program required under section 874 of this Act. (vii) Legislative, legal, or regulatory changes. (viii) Inadequate program management personnel, including lack of training, credentials, certifications, or use of best practices. (3) Correction of breach The Under Secretary for Management or his designee shall establish a date for submission within the Department of a program of corrective action that ensures that one of the following actions has occurred: (A) The breach has been corrected and the program is again in compliance with the original acquisition program baseline parameters. (B) A revised acquisition program baseline has been approved. (C) The program has been halted or cancelled. (c) Requirements relating to congressional notification if breach occurs (1) Notification to congress If a notification is made under subsection (b)(1)(B) for a breach in a major acquisition program with a cost overrun greater than 15 percent or a schedule delay greater than 180 days from the costs or schedule set forth in the acquisition program baseline, or with an anticipated failure for any key performance threshold or parameter specified in the acquisition program baseline, the Under Secretary for Management shall notify the congressional homeland security committees of the breach in the next quarterly Comprehensive Acquisition Status Report after the Under Secretary for Management receives the notification from the program manager under subsection (b)(1)(B). (2) Substantial variances in costs or schedule If a likely cost overrun is greater than 20 percent or a likely delay is greater than 12 months from the costs and schedule set forth in the acquisition program baseline for a major acquisition program, the Under Secretary for Management shall include in the notification required in (c)(1) a written certification, with supporting explanation, that— (A) the acquisition is essential to the accomplishment of the Department’s mission; (B) there are no alternatives to such capability or asset that will provide equal or greater capability in both a more cost-effective and timely manner; (C) the new acquisition schedule and estimates for total acquisition cost are reasonable; and (D) the management structure for the acquisition program is adequate to manage and control performance, cost, and schedule. (3) Submissions to congress Not later than 30 calendar days after submission to such committees of a breach notification under paragraph (1) of this section for a major acquisition program, the Under Secretary for Management shall submit to such committees the following: (A) A copy of the remediation plan and the root cause analysis prepared under subsection (b)(2) for the program. (B) A statement describing the corrective action or actions that have occurred pursuant to subsection (b)(3) for the program, with a justification for the action or actions. (d) Additional actions if breach occurs (1) Prohibition on obligation of funds During the 90-day period following submission under subsection (c)(3) of a remediation plan, root cause analysis, and statement of corrective actions with respect to a major acquisition program, the Under Secretary for Management shall submit a certification described in paragraph (2) of this subsection to the congressional homeland security committees. If the Under Secretary for Management does not submit such certification by the end of such 90-day period, then funds appropriated to the major acquisition program shall not be obligated until the Under Secretary for Management submits such certification. (2) Certification For purposes of paragraph (1), the certification described in this paragraph is a certification that— (A) the Department has adjusted or restructured the program in a manner that addresses the root cause or causes of the cost growth in the program; and (B) the Department has conducted a thorough review of the breached program’s acquisition decision event approvals and the current acquisition decision event approval for the breached program has been adjusted as necessary to account for the restructured program. . (b) Clerical amendment The table of contents in section 1(b) of the Homeland Security Act of 2002 (6 U.S.C. 101 et seq.) is further amended by adding after the item relating to section 837 the following new item: Sec. 838. Congressional notification and other requirements for major acquisition program breach. . 302. Multiyear acquisition strategy (a) In general (1) Amendment Subtitle D of title VIII of the Homeland Security Act of 2002 (6 U.S.C. 391 et seq.) is further amended by adding at the end the following new section: 839. Multiyear acquisition strategy (a) Multiyear acquisition strategy required Not later than one year after the date of the enactment of this section, the Secretary shall submit to the appropriate homeland security committees a multiyear acquisition strategy to guide the overall direction of the acquisitions of the Department while allowing flexibility to deal with ever-changing threats and risks and to help industry better understand, plan, and align resources to meet the future acquisition needs of the Department. The strategy shall be updated and included in each Future Years Homeland Security Program required under section 874 of this Act. (b) Consultation In developing the strategy, the Secretary shall consult with others as the Secretary deems appropriate, including headquarters, Components, employees in the field, and when appropriate, individuals from industry and the academic community. (c) Form of strategy The report shall be submitted in unclassified form but may include a classified annex for any sensitive or classified information if necessary. The Department also shall publish the plan in an unclassified format that is publicly available. (d) Contents of strategy The strategy shall include the following: (1) Prioritized list A systematic and integrated prioritized list developed by the Under Secretary for Management or his designee in coordination with all of the Component Acquisition Executives of Department major acquisition programs that Department and Component acquisition investments seek to address, that includes the expected security and economic benefit of the program or system and an analysis of how the security and economic benefit derived from the program or system will be measured. (2) Inventory A plan to develop a reliable Department-wide inventory of investments and real property assets to help the Department plan, budget, schedule, and acquire upgrades of its systems and equipment and plan for the acquisition and management of future systems and equipment. (3) Funding gaps A plan to address funding gaps between funding requirements for major acquisition programs and known available resources including, to the maximum extent practicable, ways of leveraging best practices to identify and eliminate overpayment for items to prevent wasteful purchasing, achieve the greatest level of efficiency and cost savings by rationalizing purchases, aligning pricing for similar items, and utilizing purchase timing and economies of scale. (4) Identification of capabilities An identification of test, evaluation, modeling, and simulation capabilities that will be required to support the acquisition of the technologies to meet the needs of the plan and ways to leverage to the greatest extent possible the emerging technology trends and research and development trends within the public and private sectors and an identification of ways to ensure that the appropriate technology is acquired and integrated into the Department’s operating doctrine and procured in ways that improve mission performance. (5) Focus on flexible solutions An assessment of ways the Department can improve its ability to test and acquire innovative solutions to allow needed incentives and protections for appropriate risk-taking in order to meet its acquisition needs with resiliency, agility, and responsiveness to assure the Nation’s homeland security and facilitate trade. (6) Focus on Incentives to Save Taxpayer Dollars An assessment of ways the Department can develop incentives for program managers and senior Department acquisition officials to prevent cost overruns, avoid schedule delays, and achieve cost savings in major acquisition programs. (7) Focus on addressing delays and bid protests An assessment of ways the Department can improve the acquisition process to minimize cost overruns in requirements development, procurement announcements, requests for proposals, evaluation of proposals, protests of decisions and awards and through the use of best practices as defined in section 4(b) of the DHS Acquisition Accountability and Efficiency Act and lessons learned by the Department and other Federal agencies. (8) Focus on improving outreach An identification and assessment of ways to increase opportunities for communication and collaboration with industry, small and disadvantaged businesses, intra-government entities, university centers of excellence, accredited certification and standards development organizations, and national laboratories to ensure that the Department understands the market for technologies, products, and innovation that is available to meet its mission needs to inform the requirements-setting process and before engaging in an acquisition, including— (A) methods designed especially to engage small and disadvantaged businesses and a cost-benefit analysis of the tradeoffs that small and disadvantaged businesses provide, barriers to entry for small and disadvantaged businesses, and unique requirements for small and disadvantaged businesses; and (B) within the Department Vendor Communication Plan and Market Research Guide, instructions for interaction by program managers with such entities to prevent misinterpretation of acquisition regulations and to permit freedom within legal and ethical boundaries for program managers to interact with such businesses with transparency. (9) Competition A plan regarding competition as described in subsection (e). (10) Acquisition workforce A plan regarding the Department acquisition workforce as described in subsection (f). (11) Feasibility of workforce development fund pilot program An assessment of the feasibility of conducting a pilot program to establish an acquisition workforce development fund as described in subsection (g). (e) Competition plan The strategy shall also include a plan (referred to in subsection (d)(9)) that shall address actions to ensure competition, or the option of competition, for major acquisition programs. The plan may include assessments of the following measures in appropriate cases if such measures are cost effective: (1) Competitive prototyping. (2) Dual-sourcing. (3) Unbundling of contracts. (4) Funding of next-generation prototype systems or subsystems. (5) Use of modular, open architectures to enable competition for upgrades. (6) Acquisition of complete technical data packages. (7) Periodic competitions for subsystem upgrades. (8) Licensing of additional suppliers, including small businesses. (9) Periodic system or program reviews to address long-term competitive effects of program decisions. (f) Acquisition workforce plan (1) Acquisition workforce The strategy shall also include a plan (referred to in subsection (d)(10)) to address Department acquisition workforce accountability and talent management that identifies the acquisition workforce needs of each Component performing acquisition functions and develops options for filling those needs with qualified individuals, including a cost-benefit analysis of contracting for acquisition assistance. (2) Additional matters covered The acquisition workforce plan shall address ways to— (A) improve the recruitment, hiring, training, and retention of Department acquisition workforce personnel, including contracting officer’s representatives, in order to retain highly qualified individuals that have experience in the acquisition life cycle, complex procurements, and management of large programs; (B) empower program managers to have the authority to manage their programs in an accountable and transparent manner as they work with the acquisition workforce; (C) prevent duplication within Department acquisition workforce training and certification requirements through leveraging already-existing training within the Federal Government, academic community, or private industry; (D) achieve integration and consistency with Government-wide training and accreditation standards, acquisition training tools, and training facilities; (E) designate the acquisition positions that will be necessary to support the Department acquisition requirements, including in the fields of— (i) program management; (ii) systems engineering; (iii) procurement, including contracting; (iv) test and evaluation; (v) life cycle logistics; (vi) cost estimating and program financial management; and (vii) additional disciplines appropriate to Department mission needs; (F) strengthen the performance of contracting officer’s representatives (as defined in Subpart 1.602-2 and Subpart 2.101 of the Federal Acquisition Regulation), including by— (i) assessing the extent to which contracting officer’s representatives are certified and receive training that is appropriate; (ii) determining what training is most effective with respect to the type and complexity of assignment; and (iii) implementing actions to improve training based on such assessment; and (G) identify ways to increase training for relevant investigators and auditors to examine fraud in major acquisition programs, including identifying opportunities to leverage existing Government and private sector resources in coordination with the Inspector General of the Department. (g) Feasibility of workforce development fund pilot program The strategy shall also include an assessment (referred to in subsection (d)(11)) of the feasibility of conducting a pilot program to establish a Homeland Security Acquisition Workforce Development Fund (in this subsection referred to as the Fund) to ensure the Department acquisition workforce has the capacity, in both personnel and skills, needed to properly perform its mission and ensure that the Department receives the best value for the expenditure of public resources. The assessment shall address the following: (1) Ways to fund the Fund, including the use of direct appropriations, or the credit, transfer, or deposit of unobligated or unused funds from Department Components into the Fund to remain available for obligation in the fiscal year for which credited, transferred, or deposited and to remain available for successive fiscal years. (2) Ways to reward the Department acquisition workforce and program managers for good program management in controlling cost growth, limiting schedule delays, and ensuring operational effectiveness through providing a percentage of the savings or general acquisition bonuses. (3) Guidance for the administration of the Fund that includes provisions to do the following: (A) Describe the costs and benefits associated with the use of direct appropriations or credit, transfer, or deposit of unobligated or unused funds to finance the Fund. (B) Describe the manner and timing for applications for amounts in the Fund to be submitted. (C) Explain the evaluation criteria to be used for approving or prioritizing applications for amounts in the Fund in any fiscal year. (D) Explain the mechanism to report to Congress on the implementation of the Fund on an ongoing basis. (E) Detail measurable performance metrics to determine if the Fund is meeting the objective to improve the acquisition workforce and to achieve cost savings in acquisition management. . (2) Clerical amendment The table of contents in section 1(b) of the Homeland Security Act of 2002 (6 U.S.C. 101 et seq.) is further amended by adding after the item relating to section 838 the following new item: Sec. 839. Multiyear acquisition strategy. . (b) Conforming amendment to future years homeland security program Section 874(b) of the Homeland Security Act of 2002 (6 U.S.C. 454(b)) is amended— (1) by striking and at the end of paragraph (2); (2) by striking the period at the end of paragraph (3) and inserting ; and; and (3) by adding at the end the following new paragraph: (4) include the multiyear acquisition strategy required under section 839 of this Act. . 303. Acquisition reports (a) In general Subtitle D of title VIII of the Homeland Security Act of 2002 (6 U.S.C. 391 et seq.) is further amended by adding at the end the following new section: 840. Acquisition reports (a) Comprehensive Acquisition Status Report (1) In general The Under Secretary for Management each year shall submit to the congressional homeland security committees, at the same time as the President’s budget is submitted for a fiscal year under section 1105(a) of title 31, United States Code, a comprehensive acquisition status report. The report shall include the following: (A) The information required under the heading Office of the Under Secretary for Management under Title I of division D of the Consolidated Appropriations Act, 2012 (Public Law 112–74) (as required under the Department of Homeland Security Appropriations Act, 2013 (Public Law 113–6). (B) A listing of programs that have been cancelled, modified, paused, or referred to the Under Secretary for Management or Deputy Secretary for additional oversight or action by the Board, Department Office of Inspector General, or the Comptroller General. (C) A listing of established Executive Steering Committees, which provide governance of a program or related set of programs and lower-tiered oversight, and support between acquisition decision events and Component reviews, including the mission and membership for each. (2) Information for major acquisition programs For each major acquisition program, the report shall include the following: (A) A narrative description, including current gaps and shortfalls, the capabilities to be fielded, and the number of planned increments or units. (B) Acquisition Review Board (or other board designated to review the acquisition) status of each acquisition, including the current acquisition phase, the date of the last review, and a listing of the required documents that have been reviewed with the dates reviewed or approved. (C) The most current, approved acquisition program baseline (including project schedules and events). (D) A comparison of the original acquisition program baseline, the current acquisition program baseline, and the current estimate. (E) Whether or not an independent verification and validation has been implemented, with an explanation for the decision and a summary of any findings. (F) A rating of cost risk, schedule risk, and technical risk associated with the program (including narrative descriptions and mitigation actions). (G) Contract status (including earned value management data as applicable). (H) A lifecycle cost of the acquisition, and time basis for the estimate. (3) Updates The Under Secretary shall submit quarterly updates to such report not later than 45 days after the completion of each quarter. (b) Quarterly Program Accountability Report The Under Secretary for Management shall prepare a quarterly program accountability report to meet the Department’s mandate to perform program health assessments and improve program execution and governance. The report shall be submitted to the congressional homeland security committees. . (b) Clerical amendment The table of contents in section 1(b) of the Homeland Security Act of 2002 (6 U.S.C. 101 et seq.) is further amended by adding after the item relating to section 839 the following new item: Sec. 840. Acquisition reports. . 304. Government Accountability Office review of multiyear acquisition strategy (a) Review required After submission to Congress of the first multiyear acquisition strategy (pursuant to section 839 of the Homeland Security Act of 2002) after the date of the enactment of this Act, the Comptroller General of the United States shall conduct a review of the plan within 180 days to analyze the viability of the plan’s effectiveness in the following: (1) Complying with the requirements in section 839 of the Homeland Security Act of 2002, as added by section 302 of this Act. (2) Establishing clear connections between Department objectives and acquisition priorities. (3) Demonstrating that Department acquisition policy reflects program management best practices and standards. (4) Ensuring competition or the option of competition for major acquisition programs. (5) Considering potential cost savings through using already-existing technologies when developing acquisition program requirements. (6) Preventing duplication within Department acquisition workforce training requirements through leveraging already-existing training within the Federal Government, academic community, or private industry. (7) Providing incentives for program managers to reduce acquisition and procurement costs through the use of best practices and disciplined program management. (8) Assessing the feasibility of conducting a pilot program to establish a Homeland Security Acquisition Workforce Development Fund. (b) Report required The Comptroller General shall submit to the congressional homeland security committees a report on the review required by this section. The report shall be submitted in unclassified form but may include a classified annex. 305. Office of Inspector General report (a) Review required No later than 2 years following the submission of the report submitted by the Comptroller General of the United States as required by section 304, the Department’s Inspector General shall conduct a review of whether the Department has complied with the multiyear acquisition strategy (pursuant to section 839 of the Homeland Security Act of 2002) and adhered to the strategies set forth in the plan. The review shall also consider whether the Department has complied with the requirements to provide the Acquisition Review Board with a capability development plan for each major acquisition program. (b) Report required The Inspector General shall submit to the congressional homeland security committees a report of the review required by this section. The report shall be submitted in unclassified form but may include a classified annex. Passed the House of Representatives June 9, 2014.Karen L. Haas,Clerk