Sec. 123 — Multiyear procurement authority for Arleigh Burke Class Destroyers
TL;DR
Subject to section 3501 of title 10, United States Code, the Secretary of the Navy may enter into one or more multiyear contracts for the procurement of up to 15 Arleigh Burke class Flight III guided missile destroyers.(b)Authority for advance procurementThe Secretary of the…
Statutory text
(a) Authority for multiyear procurement. Subject to section 3501 of title 10, United States Code, the Secretary of the Navy may enter into one or more multiyear contracts for the procurement of up to 15 Arleigh Burke class Flight III guided missile destroyers.
(b) Authority for advance procurement. The Secretary of the Navy may enter into one or more contracts, beginning in fiscal year 2027, for advance procurement associated with the destroyers for which authorization to enter into a multiyear procurement contract is provided under subsection (a), and for systems and subsystems associated with such destroyers in economic order quantities when cost savings are achievable.
(c) Condition for out-year contract paymentsA contract entered into under subsection (a) shall provide that any obligation of the United States to make a payment under the contract for a fiscal year after fiscal year 2027 is subject to the availability of appropriations or funds for that purpose for such later fiscal year.
(d) Mandatory inclusion of prepriced option in certain circumstances
(1) In general. In the event the total base quantity of destroyers to be procured through all contracts entered into under subsection (a) is less than 15, the Secretary of the Navy shall ensure that one or more of the contracts includes a prepriced option for the procurement of additional destroyers such that the sum of such base quantity and the number of destroyers that may be procured through the exercise of such options is equal to 15 destroyers.
(2) Definitions. In this subsection:(A)Base quantityThe term base quantity means the quantity of destroyers to be procured under a contract entered into under subsection (a) excluding any quantity of destroyers that may be procured through the exercise of an option that may be part of such contract.(B)Prepriced optionThe term prepriced option means a contract option for a contract entered into under subsection (a) that, if exercised, would allow the Secretary of the Navy to procure a destroyer at a predetermined price specified in such contract.
(e) Limitation. The Secretary of the Navy may not modify a contract entered into under subsection (a) if the modification would increase the target price of the destroyer by more than 10 percent above the target price specified in the original contract for the destroyer under subsection (a).