Sec. 801 — Responsibilities and authorities of portfolio acquisition executives with respect to contractors

Statutory text

(a) In general. Chapter 205 of title 10, United States Code, is amended by inserting after section 3105 the following new sections:3105a.Portfolio acquisition executives: performance management authorities with respect to contractors

(a) Performance management authorities. Each portfolio acquisition executive shall, with respect to contractors under the defense acquisition programs assigned to such executive, have the following authorities:

(1) To issue a performance improvement notice to any contractor that, as documented in any contractor past performance database used by the Department of Defense, has received a rating indicating a deficiency (such as marginal or unsatisfactory) in two or more consecutive assessment periods, or in three or more assessment periods within a period of five years. Such a notice shall specify, with particularity, the deficiencies identified in such ratings and shall establish measurable corrective action benchmarks and a remediation period not to exceed 180 days. The portfolio acquisition executive shall ensure that the notice is provided contemporaneously to the contractor and the component acquisition executive or service acquisition executive of the military department concerned, as applicable, and is documented in any contractor past performance database used by the Department.

(2) To initiate a contract restructuring action, including an action to adjust a performance metric, milestone schedule, deliverable specification, or associated incentive fee structure, without the prior approval of the component acquisition executive or the service acquisition executive of the military department concerned, as long as the total value of the restructured contract does not exceed any applicable threshold. The portfolio acquisition executive shall provide written notification to the component acquisition executive or service acquisition executive, as applicable, not later than 15 days after initiating such an action.

(3) To recommend to the component acquisition executive or the service acquisition executive of the military department concerned that a contract be terminated for cause. The service acquisition executive shall act on such recommendation, or determine not to act on such recommendation, not later than 30 days after receiving the recommendation.

(b) Responsibilities of component acquisition executive or service acquisition executiveIn a case in which the component acquisition executive or service acquisition executive, as applicable, overrides the issuance of a performance improvement notice under subsection

(a) (1), overrides a contract restructuring action under subsection

(a) (2), or determines not to act on a recommendation under subsection

(a) (3), the component acquisition executive or service acquisition executive, as applicable, shall—(1)not later than 15 days after such override or determination, make a written documentation of the override or determination that cites the specific statutory, regulatory, or policy basis for the override or determination; and(2)provide a copy of such written documentation to the portfolio acquisition executive and the Under Secretary of Defense for Acquisition and Sustainment.

(c) Limitation. This section does not—(1)authorize a portfolio acquisition executive to terminate a contract for cause without the approval of the component acquisition executive or service acquisition executive, as applicable; or(2)supersede any right of the contractor to notice and opportunity to respond under applicable provisions of law or regulation.

(d) Guidance. The Under Secretary of Defense for Acquisition and Sustainment shall issue guidance for the implementation of this section.

(e) Annual report. On an annual basis, the Under Secretary of Defense for Acquisition and Sustainment, in consultation with each component acquisition executive and service acquisition executive, shall submit to the congressional defense committees a report on the exercise of authorities under this section. The report shall include—(1)a consolidated list of all actions taken by a portfolio acquisition executive under paragraphs (1), (2), and (3) of subsection (a);(2)a consolidated list of all overrides and determinations by a component acquisition executive or service acquisition executive under subsection (b); and(3)an assessment of the effectiveness of the actions taken under paragraphs (1), (2), and (3) of subsection (a).3105b.Portfolio acquisition executives: defense-wide framework of contractor performance metrics

(a) Framework required. The Under Secretary of Defense for Acquisition and Sustainment, in consultation with each component acquisition executive and service acquisition executive, shall establish a framework of contractor performance metrics to be used by all portfolio acquisition executives of the Department of Defense. The framework shall—(1)specify metrics that must be used by each portfolio acquisition executive to assess each defense acquisition program assigned to such executive;(2)for each such metric, establish minimum thresholds for reporting; and(3)provide for consistency and comparability of contractor performance data across the Department while preserving the flexibility of each portfolio acquisition executive to tailor specific indicators and thresholds to the defense acquisition programs assigned to such executive.

(b) Categories required. The framework required by subsection (a) shall include metrics in each of the following categories:

(1) Cost performance. Metrics relating to variance from the approved cost baseline, including estimate at completion versus budget at completion, undefinitized contract action definitization rate, and cost overrun recurrence.

(2) Schedule performance. Metrics relating to adherence to milestones, including delivery delays measured in days against the approved program baseline and frequency of approved re-baselining.

(3) Technical performance. Metrics relating to achievement of key performance parameters at applicable program milestones and