§3102 Critical cost growth in major systems

Summary

If the Director of National Intelligence finds that a major system’s total cost has risen by at least the critical cost growth threshold, the Director must find the root cause and do four short cost studies: how much it will cost to finish if nothing changes, how much if requirements are reasonably changed, a rough cost for reasonable alternative systems, and whether other programs will need funding cuts. After that review, the Director must stop the program unless a report and a written certification are sent to Congress within 90 days of getting the cost report. The certification must say five things: the program is essential to national security, no cheaper alternative gives acceptable capability, the new cost estimates are reasonable, the program is a higher priority than any programs that lose money because of it, and the program’s management can control costs. The report must include the root cause work, the cost assessments, the reasons for each certification point, and any funding changes. If not ended, the Director must restructure the program to fix the root causes and improve management, cancel the last milestone approval, require a new milestone OK before new or bigger contracts (with limited exceptions), reset the baseline cost estimate, and do regular reviews. If the program is ended, the Director must tell Congress why, what alternatives were considered, and how the needed capability will be met. Reports may be classified. The Director can waive many steps if at least 90 percent of the baseline has been spent, but must notify the congressional intelligence committees within 90 days and include required information and, for big cost increases, a root cause finding and a limited certification. Key terms are defined in section 3101(a).