[Congressional Record Volume 155, Number 69 (Wednesday, May 6, 2009)]
[Senate]
[Pages S5205-S5225]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             WEAPON SYSTEMS ACQUISITION REFORM ACT OF 2009

  The PRESIDING OFFICER. Under the previous order, the Senate will 
proceed to the consideration of S. 454, which the clerk will report.
  The assistant legislative clerk read as follows:

       A bill (S. 454) to improve the organization and procedures 
     of the Department of Defense for the acquisition of major 
     weapon systems, and for other purposes.

  The Senate proceeded to consider the bill, which had been reported 
from the Committee on Armed Services, with an amendment to strike all 
after the enacting clause and insert in lieu thereof the following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Weapon 
     Systems Acquisition Reform Act of 2009''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.

                   TITLE I--ACQUISITION ORGANIZATION

Sec. 101. Reports on systems engineering capabilities of the Department 
              of Defense.
Sec. 102. Director of Developmental Test and Evaluation.
Sec. 103. Assessment of technological maturity of critical technologies 
              of major defense acquisition programs by the Director of 
              Defense Research and Engineering.
Sec. 104. Director of Independent Cost Assessment.
Sec. 105. Role of the commanders of the combatant commands in 
              identifying joint military requirements.

                      TITLE II--ACQUISITION POLICY

Sec. 201. Consideration of trade-offs among cost, schedule, and 
              performance in the acquisition of major weapon systems.
Sec. 202. Preliminary design review and critical design review for 
              major defense acquisition programs.
Sec. 203. Ensuring competition throughout the life cycle of major 
              defense acquisition programs.
Sec. 204. Critical cost growth in major defense acquisition programs.
Sec. 205. Organizational conflicts of interest in the acquisition of 
              major weapon systems.
Sec. 206. Awards for Department of Defense personnel for excellence in 
              the acquisition of products and services.

     SEC. 2. DEFINITIONS.

       In this Act:
       (1) The term ``congressional defense committees'' has the 
     meaning given that term in section 101(a)(16) of title 10, 
     United States Code.
       (2) The term ``major defense acquisition program'' has the 
     meaning given that term in section 2430 of title 10, United 
     States Code.

                   TITLE I--ACQUISITION ORGANIZATION

     SEC. 101. REPORTS ON SYSTEMS ENGINEERING CAPABILITIES OF THE 
                   DEPARTMENT OF DEFENSE.

       (a) Reports by Service Acquisition Executives.--Not later 
     than 180 days after the date of the enactment of this Act, 
     the service acquisition executive of each military department 
     shall submit to the Under Secretary of Defense for 
     Acquisition, Technology, and Logistics a report setting forth 
     the following:
       (1) A description of the extent to which such military 
     department has in place development planning organizations 
     and processes staffed by adequate numbers of personnel with 
     appropriate training and expertise to ensure that--
       (A) key requirements, acquisition, and budget decisions 
     made for each major weapon system prior to Milestones A and B 
     are supported by a rigorous systems analysis and systems 
     engineering process;
       (B) the systems engineering strategy for each major weapon 
     system includes a robust program for improving reliability, 
     availability, maintainability, and sustainability as an 
     integral part of design and development; and
       (C) systems engineering requirements, including 
     reliability, availability, maintainability, and 
     sustainability requirements, are identified during the Joint 
     Capabilities Integration Development System process and 
     incorporated into contract requirements for each major weapon 
     system.
       (2) A description of the actions that such military 
     department has taken, or plans to take, to--
       (A) establish needed development planning and systems 
     engineering organizations and processes; and
       (B) attract, develop, retain, and reward systems engineers 
     with appropriate levels of hands-on experience and technical 
     expertise to meet the needs of such military department.
       (b) Report by Under Secretary of Defense for Acquisition, 
     Technology, and Logistics.--Not later than 270 days after the 
     date of the enactment of this Act, the Under Secretary of 
     Defense for Acquisition, Technology, and Logistics shall 
     submit to the Committee on Armed Services of the Senate and 
     the Committee on Armed Services of the House of 
     Representatives a report on the system engineering 
     capabilities of the Department of Defense. The report shall 
     include, at a minimum, the following:
       (1) An assessment by the Under Secretary of the reports 
     submitted by the service acquisition executives pursuant to 
     subsection (a) and of the adequacy of the actions that each 
     military department has taken, or plans to take, to meet the 
     systems engineering and development planning needs of such 
     military department.

[[Page S5206]]

       (2) An assessment of each of the recommendations of the 
     report on Pre-Milestone A and Early-Phase Systems Engineering 
     of the Air Force Studies Board of the National Research 
     Council, including the recommended checklist of systems 
     engineering issues to be addressed prior to Milestones A and 
     B, and the extent to which such recommendations should be 
     implemented throughout the Department of Defense.

     SEC. 102. DIRECTOR OF DEVELOPMENTAL TEST AND EVALUATION.

       (a) Establishment of Position.--
       (1) In general.--Chapter 4 of title 10, United States Code, 
     is amended by inserting after section 139b the following new 
     section:

     ``Sec. 139c. Director of Developmental Test and Evaluation

       ``(a) There is a Director of Developmental Test and 
     Evaluation, who shall be appointed by the Secretary of 
     Defense from among individuals with an expertise in 
     acquisition and testing.
       ``(b)(1) The Director of Developmental Test and Evaluation 
     shall be the principal advisor to the Secretary of Defense 
     and the Under Secretary of Defense for Acquisition, 
     Technology, and Logistics on developmental test and 
     evaluation in the Department of Defense.
       ``(2) The individual serving as the Director of 
     Developmental Test and Evaluation may also serve concurrently 
     as the Director of the Department of Defense Test Resource 
     Management Center under section 196 of this title.
       ``(3) The Director shall be subject to the supervision of 
     the Under Secretary of Defense for Acquisition, Technology, 
     and Logistics and shall report to the Under Secretary.
       ``(4)(A) The Under Secretary shall provide guidance to the 
     Director to ensure that the developmental test and evaluation 
     activities of the Department of Defense are fully integrated 
     into and consistent with the systems engineering and 
     development processes of the Department.
       ``(B) The guidance under this paragraph shall ensure, at a 
     minimum, that--
       ``(i) developmental test and evaluation requirements are 
     fully integrated into the Systems Engineering Master Plan for 
     each major defense acquisition program; and
       ``(ii) systems engineering and development planning 
     requirements are fully considered in the Test and Evaluation 
     Master Plan for each major defense acquisition program.
       ``(c) The Director of Developmental Test and Evaluation 
     shall--
       ``(1) develop policies and guidance for the developmental 
     test and evaluation activities of the Department of Defense 
     (including integration and developmental testing of 
     software);
       ``(2) monitor and review the developmental test and 
     evaluation activities of the major defense acquisition 
     programs and major automated information systems programs of 
     the Department of Defense;
       ``(3) review and approve the test and evaluation master 
     plan for each major defense acquisition program of the 
     Department of Defense;
       ``(4) supervise the activities of the Director of the 
     Department of Defense Test Resource Management Center under 
     section 196 of this title, or carry out such activities if 
     serving concurrently as the Director of Developmental Test 
     and Evaluation and the Director of the Department of Defense 
     Test Resource Management Center under subsection (b)(2);
       ``(5) review the organizations and capabilities of the 
     military departments with respect to developmental test and 
     evaluation and identify needed changes or improvements to 
     such organizations and capabilities; and
       ``(6) perform such other activities relating to the 
     developmental test and evaluation activities of the 
     Department of Defense as the Under Secretary of Defense for 
     Acquisition, Technology, and Logistics may prescribe.
       ``(d) The Director of Developmental Test and Evaluation 
     shall have access to all records and data of the Department 
     of Defense (including the records and data of each military 
     department) that the Director considers necessary in order to 
     carry out the Director's duties under this section.
       ``(e)(1) The Director of Developmental Test and Evaluation 
     shall submit to Congress each year a report on the 
     developmental test and evaluation activities of the major 
     defense acquisition programs and major automated information 
     system programs of the of the Department of Defense. Each 
     report shall include, at a minimum, the following:
       ``(A) A discussion of any waivers to testing activities 
     included in the Test and Evaluation Master Plan for a major 
     defense acquisition program in the preceding year.
       ``(B) An assessment of the organization and capabilities of 
     the Department of Defense for test and evaluation.
       ``(2) The Secretary of Defense may include in any report 
     submitted to Congress under this subsection such comments on 
     such report as the Secretary considers appropriate.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of chapter 4 of such title is amended by inserting 
     after the item relating to section 139b the following new 
     item:

``139c. Director of Developmental Test and Evaluation.''.
       (3) Conforming amendments.--
       (A) Section 196(f) of title 10, United States Code, is 
     amended by striking ``the Under Secretary of Defense for 
     Acquisition, Technology, and Logistics'' and all that follows 
     and inserting ``the Under Secretary of Defense for 
     Acquisition, Technology, and Logistics and the Director of 
     Developmental Test and Evaluation.''.
       (B) Section 139(b) of such title is amended--
       (i) by redesignating paragraphs (4) through (6) as 
     paragraphs (5) through (7), respectively; and
       (ii) by inserting after paragraph (3) the following new 
     paragraph (4):
       ``(4) review and approve the test and evaluation master 
     plan for each major defense acquisition program of the 
     Department of Defense;''.
       (b) Reports on Developmental Testing Organizations and 
     Personnel.--
       (1) Reports by service acquisition executives.--Not later 
     than 180 days after the date of the enactment of this Act, 
     the service acquisition executive of each military department 
     shall submit to the Director of Developmental Test and 
     Evaluation a report on the extent to which the test 
     organizations of such military department have in place, or 
     have effective plans to develop, adequate numbers of 
     personnel with appropriate expertise for each purpose as 
     follows:
       (A) To ensure that testing requirements are appropriately 
     addressed in the translation of operational requirements into 
     contract specifications, in the source selection process, and 
     in the preparation of requests for proposals on all major 
     defense acquisition programs.
       (B) To participate in the planning of developmental test 
     and evaluation activities, including the preparation and 
     approval of a test and evaluation master plan for each major 
     defense acquisition program.
       (C) To participate in and oversee the conduct of 
     developmental testing, the analysis of data, and the 
     preparation of evaluations and reports based on such testing.
       (2) First annual report by director of developmental test 
     and evaluation.--The first annual report submitted to 
     Congress by the Director of Developmental Test and Evaluation 
     under section 139c(e) of title 10, United States Code (as 
     added by subsection (a)), shall be submitted not later than 
     one year after the date of the enactment of this Act, and 
     shall include an assessment by the Director of the reports 
     submitted by the service acquisition executives to the 
     Director under paragraph (1).

     SEC. 103. ASSESSMENT OF TECHNOLOGICAL MATURITY OF CRITICAL 
                   TECHNOLOGIES OF MAJOR DEFENSE ACQUISITION 
                   PROGRAMS BY THE DIRECTOR OF DEFENSE RESEARCH 
                   AND ENGINEERING.

       (a) Assessment by Director of Defense Research and 
     Engineering.--
       (1) In general.--Section 139a of title 10, United States 
     Code, is amended by adding at the end the following new 
     subsection:
       ``(c)(1) The Director of Defense Research and Engineering 
     shall periodically review and assess the technological 
     maturity and integration risk of critical technologies of the 
     major defense acquisition programs of the Department of 
     Defense and report on the findings of such reviews and 
     assessments to the Under Secretary of Defense for 
     Acquisition, Technology, and Logistics.
       ``(2) The Director shall submit to the Secretary of Defense 
     and to Congress each year a report on the technological 
     maturity and integration risk of critical technologies of the 
     major defense acquisition programs of the Department of 
     Defense.''.
       (2) First annual report.--The first annual report under 
     subsection (c)(2) of section 139a of title 10, United States 
     Code (as added by paragraph (1)), shall be submitted to 
     Congress not later than March 1, 2011, and shall address the 
     results of reviews and assessments conducted by the Director 
     of Defense Research and Engineering pursuant to subsection 
     (c)(1) of such section (as so added) during the preceding 
     calendar year.
       (b) Report on Resources for Implementation.--Not later than 
     120 days after the date of the enactment of this Act, the 
     Director of Defense Research and Engineering shall submit to 
     the congressional defense committees a report describing any 
     additional resources, including specialized workforce, that 
     may be required by the Director, and by other science and 
     technology elements of the Department of Defense, to carry 
     out the following:
       (1) The requirements under the amendment made by subsection 
     (a).
       (2) The technological maturity assessments required by 
     section 2366b(a) of title 10, United States Code, as amended 
     by section 202 of this Act.
       (3) The requirements of Department of Defense Instruction 
     5000, as revised.

     SEC. 104. DIRECTOR OF INDEPENDENT COST ASSESSMENT.

       (a) Director of Independent Cost Assessment.--
       (1) In general.--Chapter 4 of title 10, United States Code, 
     as amended by section 102 of this Act, is further amended by 
     inserting after section 139c the following new section:

     ``Sec. 139d. Director of Independent Cost Assessment

       ``(a) There is a Director of Independent Cost Assessment in 
     the Department of Defense, appointed by the President, by and 
     with the advice and consent of the Senate. The Director shall 
     be appointed without regard to political affiliation and 
     solely on the basis of fitness to perform the duties of the 
     Director.
       ``(b) The Director is the principal advisor to the 
     Secretary of Defense, the Under Secretary of Defense for 
     Acquisition, Technology, and Logistics, and the Under 
     Secretary of Defense (Comptroller) on cost estimation and 
     cost analyses for the acquisition programs of the Department 
     of Defense and the principal cost estimation official within 
     the senior management of the Department of Defense. The 
     Director shall--
       ``(1) prescribe, by authority of the Secretary of Defense, 
     policies and procedures for the conduct of cost estimation 
     and cost analysis for the acquisition programs of the 
     Department of Defense;
       ``(2) provide guidance to and consult with the Secretary of 
     Defense, the Under Secretary of

[[Page S5207]]

     Defense for Acquisition, Technology, and Logistics, the Under 
     Secretary of Defense (Comptroller), and the Secretaries of 
     the military departments with respect to cost estimation in 
     the Department of Defense in general and with respect to 
     specific cost estimates and cost analyses to be conducted in 
     connection with a major defense acquisition program under 
     chapter 144 of this title or a major automated information 
     system program under chapter 144A of this title;
       ``(3) establish guidance on confidence levels for cost 
     estimates on major defense acquisition programs and require 
     the disclosure of all such confidence levels;
       ``(4) monitor and review all cost estimates and cost 
     analyses conducted in connection with major defense 
     acquisition programs and major automated information system 
     programs; and
       ``(5) conduct independent cost estimates and cost analyses 
     for major defense acquisition programs and major automated 
     information system programs for which the Under Secretary of 
     Defense for Acquisition, Technology, and Logistics is the 
     Milestone Decision Authority--
       ``(A) in advance of--
       ``(i) any certification under section 2366a or 2366b of 
     this title;
       ``(ii) any certification under section 2433(e)(2) of this 
     title; and
       ``(iii) any report under section 2445c(f) of this title; 
     and
       ``(B) whenever necessary to ensure that an estimate or 
     analysis under paragraph (4) is unbiased, fair, and reliable.
       ``(c)(1) The Director may communicate views on matters 
     within the responsibility of the Director directly to the 
     Secretary of Defense and the Deputy Secretary of Defense 
     without obtaining the approval or concurrence of any other 
     official within the Department of Defense.
       ``(2) The Director shall consult closely with, but the 
     Director and the Director's staff shall be independent of, 
     the Under Secretary of Defense for Acquisition, Technology, 
     and Logistics, the Under Secretary of Defense (Comptroller), 
     and all other officers and entities of the Department of 
     Defense responsible for acquisition and budgeting.
       ``(d)(1) The Secretary of a military department shall 
     report promptly to the Director the results of all cost 
     estimates and cost analyses conducted by the military 
     department and all studies conducted by the military 
     department in connection with cost estimates and cost 
     analyses for major defense acquisition programs of the 
     military department.
       ``(2) The Director may make comments on cost estimates and 
     cost analyses conducted by a military department for a major 
     defense acquisition program, request changes in such cost 
     estimates and cost analyses to ensure that they are fair and 
     reliable, and develop or require the development of 
     independent cost estimates or cost analyses for such program, 
     as the Director determines to be appropriate.
       ``(3) The Director shall have access to any records and 
     data in the Department of Defense (including the records and 
     data of each military department) that the Director considers 
     necessary to review in order to carry out the Director's 
     duties under this section.
       ``(e)(1) The Director shall prepare an annual report 
     summarizing the cost estimation and cost analysis activities 
     of the Department of Defense during the previous year and 
     assessing the progress of the Department in improving the 
     accuracy of its costs estimates and analyses.
       ``(2) Each report under this subsection shall be submitted 
     concurrently to the Secretary of Defense, the Under Secretary 
     of Defense for Acquisition, Technology, and Logistics, the 
     Under Secretary of Defense (Comptroller), and Congress not 
     later than 10 days after the transmission of the budget for 
     the next fiscal year under section 1105 of title 31. The 
     Director shall ensure that a report submitted under this 
     subsection does not include any information, such as 
     proprietary or source selection sensitive information, that 
     could undermine the integrity of the acquisition process.
       ``(3) The Secretary may comment on any report of the 
     Director to Congress under this subsection.
       ``(f) The President shall include in the budget transmitted 
     to Congress pursuant to section 1105 of title 31 for each 
     fiscal year a separate statement of estimated expenditures 
     and proposed appropriations for that fiscal year for the 
     Director of Independent Cost Assessment in carrying out the 
     duties and responsibilities of the Director under this 
     section.
       ``(g) The Secretary of Defense shall ensure that the 
     Director has sufficient professional staff of military and 
     civilian personnel to enable the Director to carry out the 
     duties and responsibilities of the Director under this 
     section.''.
       (2) Clerical amendment.--The table of sections at the 
     beginning of chapter 4 of such title, as so amended, is 
     further amended by inserting after the item relating to 
     section 139c the following new item:

``139d. Director of Independent Cost Assessment.''.
       (3) Executive schedule level iv.--Section 5315 of title 5, 
     United States Code, is amended by inserting after the item 
     relating to the Director of Operational Test and Evaluation, 
     Department of Defense the following new item:
       ``Director of Independent Cost Assessment, Defense of 
     Defense.''.
       (b) Report on Monitoring of Operating and Support Costs for 
     MDAPs.--
       (1) Report to secretary of defense.--Not later than one 
     year after the date of the enactment of this Act, the 
     Director of Independent Cost Assessment under section 139d of 
     title 10 United States Code (as added by subsection (a)), 
     shall review existing systems and methods of the Department 
     of Defense for tracking and assessing operating and support 
     costs on major defense acquisition programs and submit to the 
     Secretary of Defense a report on the finding and 
     recommendations of the Director as a result of the review.
       (2) Transmittal to congress.--Not later than 30 days after 
     receiving the report required by paragraph (1), the Secretary 
     shall transmit the report to the congressional defense 
     committees, together with any comments on the report the 
     Secretary considers appropriate.
       (c) Transfer of Personnel and Functions of Cost Analysis 
     Improvement Group.--The personnel and functions of the Cost 
     Analysis Improvement Group of the Department of Defense are 
     hereby transferred to the Director of Independent Cost 
     Assessment under section 139d of title 10, United States Code 
     (as so added), and shall report directly to the Director.
       (d) Conforming Amendments.--
       (1) Section 181(d) of title 10, United States Code, is 
     amended by inserting ``the Director of Independent Cost 
     Assessment,'' before ``and the Director''.
       (2) Section 2306b(i)(1)(B) of such title is amended by 
     striking ``Cost Analysis Improvement Group of the Department 
     of Defense'' and inserting ``Director of Independent Cost 
     Assessment''.
       (3) Section 2366a(a)(4) of such title is amended by 
     striking ``has been submitted'' and inserting ``has been 
     approved by the Director of Independent Cost Assessment''.
       (4) Section 2366b(a)(1)(C) of such title is amended by 
     striking ``have been developed to execute'' and inserting 
     ``have been approved by the Director of Independent Cost 
     Assessment to provide for the execution of''.
       (5) Section 2433(e)(2)(B)(iii) of such title is amended by 
     striking ``are reasonable'' and inserting ``have been 
     determined by the Director of Independent Cost Assessment to 
     be reasonable''.
       (6) Subparagraph (A) of section 2434(b)(1) of such title is 
     amended to read as follows:
       ``(A) be prepared or approved by the Director of 
     Independent Cost Assessment; and''.
       (7) Section 2445c(f)(3) of such title is amended by 
     striking ``are reasonable'' and inserting ``have been 
     determined by the Director of Independent Cost Assessment to 
     be reasonable''.

     SEC. 105. ROLE OF THE COMMANDERS OF THE COMBATANT COMMANDS IN 
                   IDENTIFYING JOINT MILITARY REQUIREMENTS.

       Section 181 of title 10, United States Code, as amended by 
     section 104(d)(1) of this Act, is further amended--
       (1) by redesignating subsections (e), (f), and (g) as 
     subsections (f), (g), and (h), respectively; and
       (2) by adding after subsection (d) the following new 
     subsection (e):
       ``(e) Input From Combatant Commanders on Joint Military 
     Requirements.--The Council shall seek and consider input from 
     the commanders of the combatant commands in carrying out its 
     mission under paragraphs (1) and (2) of subsection (b) and in 
     conducting periodic reviews in accordance with the 
     requirements of subsection (f).''.

                      TITLE II--ACQUISITION POLICY

     SEC. 201. CONSIDERATION OF TRADE-OFFS AMONG COST, SCHEDULE, 
                   AND PERFORMANCE IN THE ACQUISITION OF MAJOR 
                   WEAPON SYSTEMS.

       (a) Consideration of Trade-Offs.--
       (1) In general.--The Secretary of Defense shall develop and 
     implement mechanisms to ensure that trade-offs between cost, 
     schedule, and performance are considered as part of the 
     process for developing requirements for major weapon systems.
       (2) Elements.--The mechanisms required under this 
     subsection shall ensure, at a minimum, that--
       (A) Department of Defense officials responsible for 
     acquisition, budget, and cost estimating functions are 
     provided an appropriate opportunity to develop estimates and 
     raise cost and schedule matters before performance 
     requirements are established for major weapon systems; and
       (B) consideration is given to fielding major weapon systems 
     through incremental or spiral acquisition, while deferring 
     technologies that are not yet mature, and capabilities that 
     are likely to significantly increase costs or delay 
     production, until later increments or spirals.
       (3) Major weapons system defined.--In this subsection, the 
     term ``major weapon system'' has the meaning given that term 
     in section 2379(d) of title 10, United States Code.
       (b) Duties of Joint Requirements Oversight Council.--
     Section 181(b)(1) of title 10, United States Code, is 
     amended--
       (1) in subparagraph (A), by striking ``and'' at the end;
       (2) in subparagraph (B), by striking the period at the end 
     and inserting ``; and''; and
       (3) by adding at the end the following new subparagraph:
       ``(C) in ensuring the consideration of trade-offs among 
     cost, schedule and performance for joint military 
     requirements in consultation with the advisors specified in 
     subsection (d);''.
       (c) Analysis of Alternatives.--
       (1) Requirement at material solution analysis phase.--The 
     Under Secretary of Defense for Acquisition, Technology, and 
     Logistics shall ensure that Department of Defense guidance on 
     major defense acquisition programs requires the Milestone 
     Decision Authority to conduct an analysis of alternatives 
     (AOA) during the Material Solution Analysis Phase of each 
     major defense acquisition program.
       (2) Elements.--Each analysis of alternatives under 
     paragraph (1) shall, at a minimum--
       (A) solicit and consider alternative approaches proposed by 
     the military departments and Defense Agencies to meet joint 
     military requirements; and
       (B) give full consideration to possible trade-offs between 
     cost, schedule, and performance for each of the alternatives 
     so considered.

[[Page S5208]]

       (d) Duties of Milestone Decision Authority.--Section 
     2366b(a)(1)(B) of title 10, United States Code, is amended by 
     inserting ``appropriate trade-offs between cost, schedule, 
     and performance have been made to ensure that'' before ``the 
     program is affordable''.

     SEC. 202. PRELIMINARY DESIGN REVIEW AND CRITICAL DESIGN 
                   REVIEW FOR MAJOR DEFENSE ACQUISITION PROGRAMS.

       (a) Preliminary Design Review.--Section 2366b(a) of title 
     10, United States Code, as amended by section 201(d) of this 
     Act, is further amended--
       (1) in paragraph (1), by striking ``and'' at the end;
       (2) by redesignating paragraph (2) as paragraph (3);
       (3) by inserting after paragraph (1) the following new 
     paragraph (2):
       ``(2) has received a preliminary design review (PDR) and 
     conducted a formal post-preliminary design review assessment, 
     and certifies on the basis of such assessment that the 
     program demonstrates a high likelihood of accomplishing its 
     intended mission; and''; and
       (4) in paragraph (3), as redesignated by paragraph (2) of 
     this section--
       (A) in subparagraph (D), by striking the semicolon and 
     inserting ``, as determined by the Milestone Decision 
     Authority on the basis of an independent review and 
     assessment by the Director of Defense Research and 
     Engineering; and'';
       (B) by striking subparagraph (E); and
       (C) by redesignating subparagraph (F) as subparagraph (E).
       (b) Critical Design Review.--The Under Secretary of Defense 
     for Acquisition, Technology, and Logistics shall ensure that 
     Department of Defense guidance on major defense acquisition 
     programs requires a critical design review and a formal post-
     critical design review assessment for each major defense 
     acquisition program to ensure that such program has attained 
     an appropriate level of design maturity before such program 
     is approved for System Capability and Manufacturing Process 
     Development.

     SEC. 203. ENSURING COMPETITION THROUGHOUT THE LIFE CYCLE OF 
                   MAJOR DEFENSE ACQUISITION PROGRAMS.

       (a) Ensuring Competition.--The Secretary of Defense shall 
     ensure that the acquisition plan for each major defense 
     acquisition program includes measures to ensure competition, 
     or the option of competition, at both the prime contract 
     level and the subcontract level of such program throughout 
     the life cycle of such program as a means to incentivize 
     contractor performance.
       (b) Measures To Ensure Competition.--The measures to ensure 
     competition, or the option of competition, utilized for 
     purposes of subsection (a) may include, but are not limited 
     to, measures to achieve the following, in appropriate cases 
     where such measures are cost-effective:
       (1) Competitive prototyping.
       (2) Dual-sourcing.
       (3) Funding of a second source for interchangeable, next-
     generation prototype systems or subsystems.
       (4) Utilization of modular, open architectures to enable 
     competition for upgrades.
       (5) Periodic competitions for subsystem upgrades.
       (6) Licensing of additional suppliers.
       (7) Requirements for Government oversight or approval of 
     make or buy decisions to ensure competition at the subsystem 
     level.
       (8) Periodic system or program reviews to address long-term 
     competitive effects of program decisions.
       (9) Consideration of competition at the subcontract level 
     and in make or buy decisions as a factor in proposal 
     evaluations.
       (c) Competitive Prototyping.--The Secretary of Defense 
     shall modify the acquisition regulations of the Department of 
     Defense to ensure with respect to competitive prototyping for 
     major defense acquisition programs the following:
       (1) That the acquisition strategy for each major defense 
     acquisition program provides for two or more competing teams 
     to produce prototypes before Milestone B approval (or Key 
     Decision Point B approval in the case of a space program) 
     unless the milestone decision authority for such program 
     waives the requirement on the basis of a determination that--
       (A) but for such waiver, the Department would be unable to 
     meet critical national security objectives; or
       (B) the cost of producing competitive prototypes exceeds 
     the potential life-cycle benefits of such competition, 
     including the benefits of improved performance and increased 
     technological and design maturity that may be achieved 
     through prototyping.
       (2) That if the milestone decision authority waives the 
     requirement for prototypes produced by two or more teams for 
     a major defense acquisition program under paragraph (1), the 
     acquisition strategy for the program provides for the 
     production of at least one prototype before Milestone B 
     approval (or Key Decision Point B approval in the case of a 
     space program) unless the milestone decision authority waives 
     such requirement on the basis of a determination that--
       (A) but for such waiver, the Department would be unable to 
     meet critical national security objectives; or
       (B) the cost of producing a prototype exceeds the potential 
     life-cycle benefits of such prototyping, including the 
     benefits of improved performance and increased technological 
     and design maturity that may be achieved through prototyping.
       (3) That whenever a milestone decision authority authorizes 
     a waiver under paragraph (1) or (2), the waiver, the 
     determination upon which the waiver is based, and the reasons 
     for the determination are submitted in writing to the 
     congressional defense committees not later than 30 days after 
     the waiver is authorized.
       (4) That prototypes may be required under paragraph (1) or 
     (2) for the system to be acquired or, if prototyping of the 
     system is not feasible, for critical subsystems of the 
     system.
       (d) Applicability.--This section shall apply to any 
     acquisition plan for a major defense acquisition program that 
     is developed or revised on or after the date that is 60 days 
     after the date of the enactment of this Act.

     SEC. 204. CRITICAL COST GROWTH IN MAJOR DEFENSE ACQUISITION 
                   PROGRAMS.

       (a) Authorized Actions in Event of Critical Cost Growth.--
     Section 2433(e)(2) of title 10, United States Code, is 
     amended--
       (1) by redesignating subparagraph (C) as subparagraph (D);
       (2) by striking subparagraph (B); and
       (3) by inserting after subparagraph (A) the following new 
     subparagraphs (B) and (C):
       ``(B) terminate such acquisition program, unless the 
     Secretary determines that the continuation of such program is 
     essential to the national security of the United States and 
     submits a written certification in accordance with 
     subparagraph (C)(i) accompanied by a report setting forth the 
     assessment carried out pursuant to subparagraph (A) and the 
     basis for each determination made in accordance with clauses 
     (I) through (IV) of subparagraph (C)(i), together with 
     supporting documentation;
       ``(C) if the program is not terminated--
       ``(i) submit to Congress, before the end of the 60-day 
     period beginning on the day the Selected Acquisition Report 
     containing the information described in subsection (g) is 
     required to be submitted under section 2432(f) of this title, 
     a written certification stating that--
       ``(I) such acquisition program is essential to national 
     security;
       ``(II) there are no alternatives to such acquisition 
     program which will provide equal or greater capability to 
     meet a joint military requirement (as that term is defined in 
     section 181(h)(1) of this title) at less cost;
       ``(III) the new estimates of the program acquisition unit 
     cost or procurement unit cost were arrived at in accordance 
     with the requirements of section 139d of this title and are 
     reasonable; and
       ``(IV) the management structure for the acquisition program 
     is adequate to manage and control program acquisition unit 
     cost or procurement unit cost;
       ``(ii) rescind the most recent Milestone approval (or Key 
     Decision Point approval in the case of a space program) for 
     such program and withdraw any associated certification under 
     section 2366a or 2366b of this title; and
       ``(iii) require a new Milestone approval (or Key Decision 
     Point approval in the case of a space program) for such 
     program before entering into a new contract, exercising an 
     option under an existing contract, or otherwise extending the 
     scope of an existing contract under such program; and''.
       (b) Total Expenditure for Procurement Resulting in 
     Treatment as MDAP.--Section 2430(a)(2) of such title is 
     amended by inserting ``, including all planned increments or 
     spirals,'' after ``an eventual total expenditure for 
     procurement''.

     SEC. 205. ORGANIZATIONAL CONFLICTS OF INTEREST IN THE 
                   ACQUISITION OF MAJOR WEAPON SYSTEMS.

       (a) Revised Regulations Required.--Not later than 180 days 
     after the date of the enactment of this Act, the Under 
     Secretary of Defense for Acquisition, Technology, and 
     Logistics shall revise the Defense Supplement to the Federal 
     Acquisition Regulation to address organizational conflicts of 
     interest by contractors in the acquisition of major weapon 
     systems.
       (b) Elements.--The revised regulations required by 
     subsection (a) shall, at a minimum--
       (1) ensure that the Department of Defense receives advice 
     on systems architecture and systems engineering matters with 
     respect to major weapon systems from federally funded 
     research and development centers or other sources independent 
     of the prime contractor;
       (2) require that a contract for the performance of systems 
     engineering and technical assistance (SETA) functions with 
     regard to a major weapon system contains a provision 
     prohibiting the contractor or any affiliate of the contractor 
     from having a direct financial interest in the development or 
     construction of the weapon system or any component thereof;
       (3) provide for an exception to the requirement in 
     paragraph (2) for an affiliate that is separated from the 
     contractor by structural mechanisms, approved by the 
     Secretary of Defense, that are similar to those required 
     under rules governing foreign ownership, control, or 
     influence over United States companies that have access to 
     classified information, including, at a minimum--
       (A) establishment of the affiliate as a separate business 
     entity, geographically separated from related entities, with 
     its own employees and management and restrictions on 
     transfers for personnel;
       (B) a governing board for the affiliate that has 
     organizational separation from related entities and 
     governance procedures that require the board to act solely in 
     the interest of the affiliate, without regard to the 
     interests of related entities, except in specified 
     circumstances;
       (C) complete informational separation, including the 
     execution of non-disclosure agreements;
       (D) initial and recurring training on organizational 
     conflicts of interest and protections against organizational 
     conflicts of interest; and
       (E) annual compliance audits in which Department of Defense 
     personnel are authorized to participate;
       (4) prohibit the use of the exception in paragraph (3) for 
     any category of systems engineering and technical assistance 
     functions (including, but not limited to, advice on source 
     selection matters) for which the potential for an 
     organizational conflict of interest or the appearance of an 
     organizational conflict of interest

[[Page S5209]]

     makes mitigation in accordance with that paragraph an 
     inappropriate approach;
       (5) authorize waiver of the requirement in paragraph (2) in 
     cases in which the agency head determines in writing that--
       (A) the financial interest of the contractor or its 
     affiliate in the development or construction of the weapon 
     system is not substantial and does not include a prime 
     contract, a first-tier subcontract, or a joint venture or 
     similar relationship with a prime contractor or first-tier 
     subcontractor; or
       (B) the contractor--
       (i) has unique systems engineering capabilities that are 
     not available from other sources;
       (ii) has taken appropriate actions to mitigate any 
     organizational conflict of interest; and
       (iii) has made a binding commitment to comply with the 
     requirement in paragraph (2) by not later than January 1, 
     2011; and
       (6) provide for fair and objective ``make-buy'' decisions 
     by the prime contractor on a major weapon system by--
       (A) requiring prime contractors to give full and fair 
     consideration to qualified sources other than the prime 
     contractor for the development or construction of major 
     subsystems and components of the weapon system;
       (B) providing for government oversight of the process by 
     which prime contractors consider such sources and determine 
     whether to conduct such development or construction in-house 
     or through a subcontract;
       (C) authorizing program managers to disapprove the 
     determination by a prime contractor to conduct development or 
     construction in-house rather than through a subcontract in 
     cases in which--
       (i) the prime contractor fails to give full and fair 
     consideration to qualified sources other than the prime 
     contractor; or
       (ii) implementation of the determination by the prime 
     contractor is likely to undermine future competition or the 
     defense industrial base; and
       (D) providing for the consideration of prime contractors 
     ``make-buy'' decisions in past performance evaluations.
       (c) Organizational Conflict of Interest Review Board.--
       (1) Establishment required.--Not later than 90 days after 
     the date of the enactment of this Act, the Secretary of 
     Defense shall establish within the Department of Defense a 
     board to be known as the ``Organizational Conflict of 
     Interest Review Board''.
       (2) Duties.--The Board shall have the following duties:
       (A) To advise the Under Secretary of Defense for 
     Acquisition, Technology, and Logistics on policies relating 
     to organizational conflicts of interest in the acquisition of 
     major weapon systems.
       (B) To advise program managers on steps to comply with the 
     requirements of the revised regulations required by this 
     section and to address organizational conflicts of interest 
     in the acquisition of major weapon systems.
       (C) To advise appropriate officials of the Department on 
     organizational conflicts of interest arising in proposed 
     mergers of defense contractors.
       (d) Major Weapon System Defined.--In this section, the term 
     ``major weapon system'' has the meaning given that term in 
     section 2379(d) of title 10, United States Code.

     SEC. 206. AWARDS FOR DEPARTMENT OF DEFENSE PERSONNEL FOR 
                   EXCELLENCE IN THE ACQUISITION OF PRODUCTS AND 
                   SERVICES.

       (a) In General.--Not later than 180 days after the date of 
     the enactment of this Act, the Secretary of Defense shall 
     commence carrying out a program to recognize excellent 
     performance by individuals and teams of members of the Armed 
     Forces and civilian personnel of the Department of Defense in 
     the acquisition of products and services for the Department 
     of Defense.
       (b) Elements.--The program required by subsection (a) shall 
     include the following:
       (1) Procedures for the nomination by the personnel of the 
     military departments and the Defense Agencies of individuals 
     and teams of members of the Armed Forces and civilian 
     personnel of the Department of Defense for eligibility for 
     recognition under the program.
       (2) Procedures for the evaluation of nominations for 
     recognition under the program by one or more panels of 
     individuals from the government, academia, and the private 
     sector who have such expertise, and are appointed in such 
     manner, as the Secretary shall establish for purposes of the 
     program.
       (c) Award of Cash Bonuses.--As part of the program required 
     by subsection (a), the Secretary may award to any individual 
     recognized pursuant to the program a cash bonus authorized by 
     any other provision of law to the extent that the performance 
     of such individual so recognized warrants the award of such 
     bonus under such provision of law.

  Mr. LEVIN. Mr. President, on behalf of the Senate Armed Services 
Committee, we are pleased to bring S. 454, the Weapon Systems 
Acquisition Reform Act of 2009 to the Senate floor. I introduced this 
bill with Senator McCain on February 23 to address problems in the 
performance of the major defense acquisition programs of the Department 
of Defense at a time when the cost growth on these programs has reached 
levels we simply cannot afford.
  Five weeks later, the bill was unanimously approved by the Armed 
Services Committee, and just last week the President called on Congress 
to act quickly on the bill. Report after report has shown that there 
are fundamental problems with the way we buy major weapons systems. In 
the last month alone, we received three major reports documenting 
problems with the acquisition system.
  First, the Government Accountability Office reported that the cost 
overruns of the Department's 97 largest acquisition programs now total 
almost $300 billion over the original program estimates, and the 
programs are an average of 22 months behind schedule. That is true even 
though the Department has cut unit quantities and reduced performance 
expectations on many programs in an effort to expedite production and 
hold costs down.
  Second, we got a report from the Business Executives for National 
Security, BENS. They reported:

       We have an acquisition system at odds with the best 
     practices in the business world: insufficient systems 
     engineering capability [and] unrealistic cost estimating that 
     injects too much optimism in early program execution. . . .

  Then, thirdly, there was a Defense Science Board report that said:

       Today, the defense acquisition process takes too long to 
     produce weapons that are too expensive. . . .

  As Secretary Gates pointed out in his testimony before our committee 
earlier this year:

       The list of big-ticket weapons systems that have 
     experienced contract or program performance problems spans 
     the services.
       Here are just a few examples of the kind of problems the 
     Department of Defense's major acquisition programs have 
     encountered. The Navy initially established a goal of $220 
     million and a 2-year construction cycle for the two lead 
     ships on the Littoral Combat Ship, the LCS program. Those 
     goals ran counter to the Navy's historic experience in 
     building new ships and were inconsistent with the complexity 
     of the design required to make the program successful. As a 
     result, program costs have tripled and the program is almost 
     4 years behind schedule.

  Next, the Air Force initially estimated that commonality between the 
three variants, threat varieties, of the Joint Strike Fighter would 
significantly reduce development costs. However, that level of 
commonality has proven impossible to achieve. Twelve years after the 
program started, three of the JSF's eight critical technologies are 
still not mature. Its production processes are not mature, and its 
designs are still not fully proven and tested.
  As a result, the program is now expected to exceed its original 
budget by almost 40 percent. That is $40 billion. The Army 
underestimated the lines of code needed to support the Future Combat 
System's software development by a factor of three. That led to an 
increase in software development costs that now approaches $8 billion. 
So 8 years after the program started, only three of the Future Combat 
System's 44 critical technologies are fully mature. GAO tells us that 
the Army has not advanced the maturity of 11 critical technologies 
since 2003, and that 2 other technologies, which are central to the 
Army's plans, are now rated less mature than when the program began. As 
a result, the program is now expected to exceed its original budget by 
about 45 percent or $40 billion. It is as much as 5 years behind 
schedule and is likely to be substantially restructured.
  There is a set of common problems underlying all these program 
failures. As a general rule, when the Department of Defense acquisition 
program fails, it is because the Department relies on unreasonable 
costs and schedule estimates; establishes unrealistic performance 
expectations; insists on the use of immature technologies; and adopts 
costly changes to program requirements, production quantities and 
funding levels in the middle of ongoing programs.
  The bill we bring before the Senate today is designed to address 
these problems and to help put major defense acquisition programs on a 
sound footing from the outset by addressing program shortcomings in the 
early phases of the acquisition process. Our bill is going to address 
problems with unreasonable performance requirements and immature 
technologies by requiring the Department of Defense to reestablish 
systems engineering organizations and developmental testing 
capabilities that were downsized or eliminated as a result of 
reductions in the acquisition workforce in the late 1990s; periodically 
review and assess the maturity of critical technologies; and make 
greater use of prototypes, including competitive prototypes, to prove 
that new

[[Page S5210]]

technologies work before trying to produce them.
  Our bill will address problems with unreasonable cost and schedule 
estimates by establishing an independent cost estimating office headed 
by a Senate-confirmed director of independent cost assessment in an 
effort to ensure that the budget assumptions underlying acquisition 
programs are sound.
  We deal with a similar problem in the Congress by using an 
independent office, the Congressional Budget Office, to tell us how 
much direct spending programs are really going to cost. Those of us who 
have tangled with the CBO over the years know how tough and independent 
that office can be in insisting on its estimates. We can decide to 
spend the money anyway, but we do so with our eyes wide open because 
the cost estimator is not going to back down.
  The Department of Defense itself has a model for this type of 
independence in the Director of Operational Test and Evaluation, the 
DOT&E. For the last 25 years, that Director, who is appointed by the 
President, confirmed by the Senate, and reports directly to the 
Secretary of Defense, has ensured that weapons systems are adequately 
tested before they are deployed by providing independent certifications 
as to whether new military systems are effective and suitable for 
combat. Program officials and contractors may disagree with the 
Director, but they have discovered they cannot go around him.
  Section 104 of our bill would ensure comparable discipline when it 
comes to cost estimating by establishing a new director of independent 
cost assessment. Like the DOT&E, a new director will be appointed by 
the President, confirmed by the Senate, and will report directly to the 
Secretary of Defense. Like the Director of Test and Evaluation, this 
official would have the independence and the clout within the 
Department to make objective determinations and stick to them. A truly 
independent cost estimating director will not be popular within the 
Department, as the DOT&E is not popular often, but he will make our 
acquisition system work better by forcing the Department to recognize 
the real cost of what our Secretary of Defense has called ``exquisite 
requirements.''
  Only when the Department faces up to these costs will it become more 
realistic in its requirements and start to make the necessary tradeoffs 
between cost, schedule, and performance.
  Section 104 makes the Director responsible for all cost estimates and 
cost analyses conducted in connection with major defense acquisition 
programs and major automated systems programs in the Department of 
Defense. Under section 104, the Director is required to perform his own 
cost estimates at four separate points in the life of each program for 
which the Under Secretary is the milestone decision authority. On other 
programs, he may rely on an independent cost estimate produced by one 
of the military departments but only if he determines that the 
service's independent estimate is unbiased, fair, and reliable.
  Our bill would also address problems with costly changes in the 
middle of a program by putting teeth in the Nunn-McCurdy requirements 
that currently exist for troubled acquisition programs.
  We will establish a presumption that any program that exceeds its 
original baseline by more than 50 percent will be terminated unless it 
can be justified--be ``justified;'' and this is critically important--
from the ground up.
  Finally, our bill would address an inherent conflict of interest we 
see on a number of programs today, when a contractor hired to give us 
an independent assessment of an acquisition program is participating in 
the development or construction side of the same program.
  We held a hearing back in March on S. 454, at which four witnesses, 
including two former Under Secretaries of Defense for Acquisition, 
Technology, and Logistics, endorsed the committee's acquisition reform 
effort. The new Under Secretary for Acquisition, Technology, and 
Logistics added his support at his March 26 nomination hearing. In 
addition, we have since received extensive comments on the bill from 
the Department of Defense, from the defense industry, and from 
independent experts on the acquisition system.
  Senator McCain and I took those comments into consideration and we 
offered a number of modifications to the bill, which were adopted by 
the Armed Services Committee at our April 2 markup. We did not make all 
of the changes requested by the Department or the contractor community. 
For example, the Department would like to eliminate the provision on 
the Director of Independent Cost Assessment. Many contractors would 
prefer we not tighten the rules for organizational conflicts of 
interest. And both the Department and industry would like us to drop 
our Nunn-McCurdy amendments, which place tough new requirements on 
failing programs. We have not done that. These provisions are tough 
medicine, but the acquisition system needs tough medicine.
  In January, Secretary Gates told our committee that we must work 
together to address the ``repeated--and unacceptable--problems with 
requirements, schedule, cost, and performance'' from which too many of 
our defense acquisition programs suffer. On March 4, the President 
endorsed the goals of the bill, telling the press that ``It's time to 
end the extra costs and long delays that are all too common in our 
defense contracting.'' Last week, the President reiterated his position 
that the bill has his full support, and he urged us to act quickly.
  I hope our colleagues will join us. Senator McCain has been 
instrumental in making this happen, and we and the Nation are 
appreciative to him for so many things, but we can add this now to the 
list. Also, our full committee endorsed this bill. It was adopted 
unanimously in committee. It is a bipartisan bill.
  We look forward to beginning consideration of this legislation. And 
to those Senators who have amendments, we hope they will let us know 
about them to see if we can work them out, and, if not, arrange a time 
for their consideration.
  Again, I thank my friend from Arizona for all his work on this 
matter.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. McCAIN. Mr. President, I wish to begin by thanking my friend from 
Michigan, the distinguished chairman of the committee, whom I have had 
the great honor of working with for many years. Senator Levin and I 
have not always agreed on every issue; we are of different parties. But 
we have had, in my view, a great opportunity to work together for the 
good of this Nation and its security and the men and women who serve 
it.
  I again thank Senator Levin for his leadership in bringing this 
legislation quickly through our committee in a unanimous, bipartisan 
fashion, and bringing it to the floor.
  As Senator Levin has mentioned, there may be some amendments or some 
modifications that our colleagues want to make, but I am confident we 
can get this bill done, into conference, and on the desk of the 
President. I am happy to say the President is very supportive. A 
meeting he and Senator Levin and I had with the leaders in the House 
Armed Services Committee indicates the President and the 
administration's commitment.
  I also want to say Secretary Gates--a man who I believe is one of the 
outstanding Secretaries of Defense in the history of our country--has 
always been forcefully in support of this legislation. There obviously 
is more to do because we have a broken system, a system that is broken 
so badly that in our attempt to provide a replacement for the 
President's helicopter--which is some 30 years old, known as Marine 
One--we came to a point where the helicopter costs more than Air Force 
One.
  You cannot make it up--where we have a future combat system with cost 
overruns of tens of billions of dollars; a joint strike fighter program 
that is completely out of control; and contracts--and there are many 
areas to place the blame and responsibility--but contracts that are let 
at certain cost estimates and then lose all touch with the original 
realities.
  Is there anybody who is an expert on defense acquisition, weapons 
systems acquisition, who believes the final cost will be anything near 
what the initial cost was as presented to Congress and the American 
people? Of course not. Of course not.
  So the title of this legislation is the ``Weapon Systems Acquisition 
Reform Act of 2009''--perhaps not a very exciting title. But the fact 
is, we have out-

[[Page S5211]]

of-control costs of our weapons systems, which we cannot afford. We are 
expanding our Army and Marine Corps. We have increased obligations in 
Afghanistan, which has certainly been highlighted by the recent events 
in Pakistan, as well as Afghanistan. We cannot afford it.
  We cannot afford to take care of our obligations in at least two 
wars, and potential flashpoints all over the world, and continue the 
spending spree we are on on weapons systems acquisition. This is 
timely. It is needed.
  I again thank the chairman of the committee, Senator Levin, for his 
leadership in seeing this bill from introduction through floor 
consideration today. It shows, I think--and I do not want to make too 
much of it, but it does show when there is an issue that cries out for 
bipartisan action, this one can be an example now and in the future.
  I do not want to get into a lot of the details of how all this came 
about. But I would remind my colleagues that back some years ago, we 
used to have a thing called fixed-cost contracts. Those were the 
majority of the contracts that were let when we wanted to build a new 
weapons system: a new airplane, a new ship, a new tank. For many years, 
we were almost able to stay within those costs.
  There were some dramatic exceptions. I can remember back in the 1970s 
the cost escalation associated with new nuclear submarines. And I can 
remember some others. But, generally speaking, we built weapons systems 
and gave them to the military at very close to their original cost 
estimates. That is not the case today.
  Some will argue--as I have heard in the industry--well, there are 
technical changes that are ordered by the military which increase the 
cost. I think Secretary Gates pointed out some months ago: Are we 
allowing the perfect to be the enemy of the good? Are we getting a 
weapon system which achieves 80 to 90 percent of what we want--which, 
it seems to me, is under reasonable costs--or are we making all these 
technical changes, which cause the cost of these systems to go up in 
the most dramatic fashion?
  We cannot afford to continue to do it. We cannot. I think this is an 
important step. I know the chairman would agree with me. This is not 
the only step that needs to be taken to bring an out-of-control system 
under some kind of control and accountability to the American taxpayer.
  In its most recent assessment of the Department of Defense's major 
weapons systems, the General Accountability Office observed that ``the 
overall performance of weapon system programs is poor [and] the time 
for change is now.''
  So I say to my colleagues, as they come to the floor with amendments 
and debate--and we need to discuss this--we should keep in mind the 
General Accountability Office's observation that ``the time for change 
is now.''
  I would also remind my colleagues and the American people this 
legislation has to pass through the House. We have to then go to 
conference. We then have to have the President sign it. And then the 
changes have to be implemented. So we are not seeing even an immediate 
turnaround with the rapid consideration of this legislation, as I think 
we can achieve today.
  I would ask my colleagues on this side of the aisle, if they have 
amendments, if they would notify the cloakroom, and we will make time 
for them. I know the chairman and I can enter into time agreements so 
we can dispense with the legislation in an expeditious way as possible, 
but also taking into consideration any concerns, amendments, our 
colleagues on both sides of the aisle have.
  The chairman has described, I think, this bill very well, and I do 
not want to repeat his assessment. But I do want to point out a couple 
things or emphasize a couple points the chairman made.
  The bill improves how the Department of Defense manages probably the 
single most significant driver of cost growth in our largest weapons 
procurement programs: technology risk. Basically, it does so by 
starting programs off right--with sound systems engineering, 
developmental testing, and independent cost estimates early in the 
program. We have seen these cost estimates particularly being 
unrealistic because we have not done the proper sound systems 
engineering and developmental testing that is necessary to get a 
correct assessment of costs.
  The bill, among many other things, requires the Department of Defense 
to assess each department's ability to conduct early stage systems 
engineering and fill in any gaps in that important capability.
  The bill provides for the creation or resumption of key oversight 
positions, including a Director of Independent Cost Assessment and a 
Director of Developmental Testing and Evaluation. I am not one who 
believes in creating new positions. I think our bureaucracy over on the 
other side of the river is big enough. But I do believe we need to 
create and resume key oversight functions, and those do require a 
Director of Independent Cost Assessment and a Director of Developmental 
Testing and Evaluation.
  The relationship between those who are doing the contracting, other 
contractors, and the awardee is way too close today for us to get truly 
independent assessments and cost controls.
  The bill requires that preliminary design and critical design reviews 
are completed early in a program's acquisition cycle so as to inform 
go/no-go purchase decisions on major weapons systems.
  The bill requires that the Department's budget, requirements, and 
acquisitions community consult with each other and make tradeoffs 
between cost, schedule, and performance early in the procurement 
process, and get combatant commanders more involved in the requirements 
process.
  I want to emphasize that last point. The combatant commanders are the 
end users of the equipment we provide them with. Unfortunately, on many 
occasions, the combatant commanders have not been involved in the 
requirements process early enough on or too late, to the point where 
they cannot make significant changes. What we want to do is give the 
Department, under the leadership of our great Secretary of Defense and 
the Congress, a big stick--bigger than anything available under current 
law--to wield against the very worst performing programs.
  On the broadest level, this bill recognizes that only when a program 
is predictable; that is, when milestones are being met, estimated costs 
are actual costs, and performance-to-contract specifications and ``key 
performance parameters'' are achieved, only then can we rely on the 
acquisition process to provide the joint warfighter with timely optimal 
capability at the most reasonable cost to the taxpayer.

  The approach provided for in this bill, which allows the Department 
of Defense to manage technology risks effectively, should help it move 
away from cost-reimbursable contracts and instead maximize its use of 
fixed price-type contracts. When coupled with initiatives that subject 
programs to full and open competition, this approach could save 
taxpayers billions of dollars.
  While we do not intend this bill as a panacea that will cure all that 
ails the defense procurement process, as it is, it constitutes an 
important next step in Congress's continuing effort to help the 
Department reform itself.
  Two final points.
  Since the chairman and I originally introduced the bill, the 
Department of Defense and others have raised various concerns about 
discrete elements of the bill. The bill now under consideration has 
benefited from that dialog as it addresses their reasonable concerns, 
without undermining the underlying intent of the bill, to put in place 
an evolutionary, knowledge-based acquisition process that metes out 
technology risks early in a program.
  I note for the record that we received testimony on this bill in our 
March 3, 2009, hearing. A day later, the President came out in support 
of the bill's underlying principles. Just a few days ago, he offered an 
unqualified endorsement. In addition, Secretary Gates and Dr. Ashton 
Carter, the new Under Secretary of Defense for Acquisition, Technology 
and Logistics, have spoken approvingly of the bill. Also, the General 
Accountability Office, two former Defense acquisition chiefs, and 
various taxpayer advocacy and think tank organizations, including the 
Center for American Progress, Business Executives for National 
Security, the Project on Government Oversight, known as POGO, the 
National Taxpayers Union, NTU, the U.S. Public Interest Research

[[Page S5212]]

Group, PIRG, and Taxpayers for Common Sense, have also weighed in in 
support of the bill.
  I ask unanimous consent to have their statements printed in the 
Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

     Hon. Carl Levin,
     Chairman, U.S. Senate Committee on Armed Services, 
         Washington, DC.
     Hon. John McCain,
     Ranking Member, U.S. Senate Committee on Armed Services, 
         Washington, DC.
       Dear Chairman Levin and Ranking Member McCain, The 
     undersigned groups applaud your commitment to reforming and 
     improving the Department of Defense's (DoD's) acquisition 
     system through the Weapons Acquisition Reform Act of 2009 (S. 
     454) and the Weapons Acquisition System Reform Through 
     Enhancing Technical Knowledge and Oversight (WASTE TKO) Act 
     of 2009 (H.R. 2101). Both pieces of legislation include 
     important provisions to restore discipline to DoD's 
     procurement process. As the final legislation is worked out 
     in conference, we believe that the following principles 
     should be preserved:
       Ensuring only programs with design maturity move forward--
     Programs that enter production before their designs are 
     mature are vulnerable to gross schedule and cost overruns. 
     The Senate bill advocates a strategy that would significantly 
     improve programs by requiring design reviews to certify that 
     programs have attained an appropriate level of design 
     maturity before a program is approved for System Capability 
     and Manufacturing Process Development. As a result of this 
     reform, program and cost risk could be significantly reduced.
       Elevating independent cost estimates--We support the 
     establishment of a Director of Independent Cost Assessment to 
     provide oversight and implement policies and procedures to 
     make sure that the cost estimation process is reliable and 
     objective. Creating this new, independent position is 
     important to prevent the cycle of costs that exceed estimates 
     due to insufficient knowledge of accurate requirements.
       Increasing accountability for programs that experience 
     critical cost growth--Both bills propose language that place 
     additional and needed scrutiny on programs that experience 
     critical cost growth. The House bill seeks to increase 
     accountability by asking for an assessment of the root cause 
     of growth, program validity, the viability of program 
     strategy, and the quality of program management to determine 
     whether a program should be terminated. But we believe the 
     more aggressive strategy advocated by the Senate will do more 
     to increase program discipline by requiring that a program be 
     terminated unless the Secretary determines that it is 
     essential to national security, and includes documentation 
     that also states that 1) there are no alternatives to the 
     acquisition program ``which will provide equal or greater 
     capability to meet a joint military requirement''; 2) the new 
     acquisition cost or procurement unit costs are reasonable; 
     and 3) the management structure for the acquisition program 
     is adequate to manage and control program acquisition unit 
     cost or procurement unit cost. By also rescinding the most 
     recent Milestone approval and requiring a new approval, we 
     believe program management for programs that experience 
     critical cost growth will be improved.
       Reducing organizational conflicts of interest--Independent 
     analysis is key to ensuring that DoD decision makers are 
     given unbiased, accurate information upon which to base 
     program decisions. While we applaud the House for calling for 
     a study to examine how to eliminate or mitigate 
     organizational conflicts of interest, we also strongly 
     support preventing organizational conflicts. The Senate 
     version of this bill would decrease conflicts of interest by 
     mandating that DoD seek independent advice on systems 
     architecture and systems engineering for major weapon 
     systems. We also support the language initially proposed in 
     S. 454 that would require that a contract for the performance 
     of systems engineering and technical assistance (SETA) 
     functions for major weapons systems contain a provision 
     prohibiting the contractor or any affiliate of the contractor 
     from having a direct financial interest in the development or 
     construction of the weapon system or any component thereof. 
     We urge you to include the ``Organizational Conflict of 
     Interest'' provision that explicitly defines the minimum 
     regulations to be enacted that will preclude contractors from 
     advising the Department of Defense on weapons systems and 
     then developing them.
       Increasing competition in major weapons systems--Both bills 
     enhance competition in the procurement process that will 
     translate into the best value for taxpayers and also serves 
     as an important tool to prevent waste, fraud, and abuse. We 
     support language that would encourage programs to utilize 
     methods such as competitive prototyping, periodic 
     competitions for subsystem upgrades, licensing of additional 
     suppliers, and periodic system or program reviews to address 
     long-term competitive effects of program decisions. But we 
     believe that competition, and with it benefits to taxpayers, 
     will only be further enhanced by measures in the Senate bill 
     to increase the use of government oversight or approval in 
     make or buy decisions at every system level.
       Increasing transparency in the waiver process--The answer 
     to solving the problems with DoD's procurement process is not 
     simply a matter of making new rules. We believe that many of 
     the rules and controls are already in place for responsible 
     procurement of weapons systems, but that these rules are too 
     frequently ignored or otherwise not followed, resulting in a 
     system that has been plagued by cost and schedule overruns. 
     The House adopts an important strategy for this effort by 
     forcing DoD to supply Congress with explanations for waivers 
     to key provisions for Milestone decisions and follow-up 
     annual reviews of these programs. This significantly 
     increases Congress's ability to oversee DoD and make sure 
     that taxpayers are getting the national security capabilities 
     they need at a reasonable price.
       We also support the proposed reforms to increase the 
     emphasis on systems engineering, developmental testing, and 
     technology maturity assessments, along with confidence levels 
     for cost estimates. All of these principles help programs to 
     have a strong foundation.
       As important as all of these provisions are, it's important 
     to recognize that this legislation is only one step in 
     reforming weapons acquisition. The defense procurement 
     process is also in desperate need of discipline. Standards 
     for appropriate levels of design maturity should be clearly 
     defined to meet missions and requirements. Waivers from 
     procurement rules should be used rarely, should be the 
     exception, not the rule, and should be made available to both 
     Congress and the public. Additionally, spiral acquisition 
     contracts should not be used to push immature technologies 
     back in the production process, where they can still endanger 
     the program's cost and schedule. All technologies should be 
     mature before committing to production.
       In the short term, Defense Secretary Robert Gates has 
     demonstrated his commitment to restoring discipline to the 
     Pentagon's weapons acquisition by his aggressive program 
     cuts, and Congress should follow his lead in putting the 
     public good ahead of their parochial interests. But in order 
     to achieve lasting, meaningful change, the Pentagon must 
     follow the rules and controls in place, and Congress must 
     conduct oversight to make sure that they do so. We look 
     forward to working with you in the future to implement these 
     changes.
     Danielle Brian,
       Project on Government Oversight.
     Pete Sepp,
       Vice President, National Taxpayers Union, U.S. Public 
     Interest Research Group.
     Ryan Alexander,
       Taxpayers for Common Sense.
                                  ____

                                               Business Executives


                                        for National Security,

                                   Washington, DC, March 31, 2009.
     Hon. John McCain,
     Ranking Member, Committee on Armed Services,
     U.S. Senate.
       Dear Senator McCain: We note with pleasure the introduction 
     of your bill targeted towards improvement of the Defense 
     Department's acquisition management process. At Business 
     Executives for National Security (BENS), we believe--and have 
     asserted for some time--that acquisition reform is one of the 
     most important areas for achieving efficiencies and savings 
     that can be redirected to the warfighter. In line with your 
     proposals, research shows the keys to successful acquisition 
     are to start programs with sound systems engineering, realism 
     in cost-estimating and subsequent funding, and ensuring 
     appropriate technology maturation before entry into the 
     program. Your proposal takes steps in the appropriate 
     direction toward ensuring increased attention to these 
     important areas.
       For over twenty five years BENS has been the nation's pre-
     eminent conduit for bringing the best business practices and 
     advice from the private sector to the world of national 
     security. Through this engagement BENS has come to recognize 
     that the Department of Defense and the Military Services are 
     not businesses; they are organizations with an ethos and 
     culture unique to their members and mission. Recognizing the 
     difference has allowed BENS to help the Defense Department 
     adopt relevant, proven practices that slash bureaucracy, 
     streamline operations, and cut waste without violating those 
     non-business characteristics which cannot be changed.
       Therefore, we are particularly supportive of the Senate 
     bill, Weapon Systems Acquisition Reform Act of 2009 (S. 454). 
     We believe this bill, as good as it is, could go further in 
     addressing many of the embedded processes that continue to 
     detract from the overall effectiveness of the process. We 
     fail sometimes in the basic recognition that the defense 
     acquisition system is a national enterprise comprised of 
     branches and agencies of the federal government on both sides 
     of the Potomac River, and in the defense and private sectors 
     nationally and globally. Based on the research of our Task 
     Force on Acquisition Law and Oversight, BENS has concluded 
     that it is time to fundamentally reset the expectations for 
     what our nation wants from the defense acquisition enterprise 
     and its processes. Congress is best suited to define and 
     advocate these expectations. Too many studies and too many 
     good recommendations have gone unheeded. If we are to reform, 
     only Congress can lead it.

[[Page S5213]]

       Your attention to this important issue is heartening. BENS 
     recommends that Congress, as it continues to fashion this 
     legislation, give careful consideration to the 
     recommendations we make in our report, which is expected to 
     be issued by April 30, 2009. We look forward to a successful 
     outcome on the acquisition management issue, and to providing 
     any further help as you negotiate the final bill. Please 
     contact Chuck Boyd should you have any questions.
           Sincerely,
     Joseph E. Robert, Jr.
       Chairman, BENS Board of Directors,
       Chairman and CEO, J.E. Robert Companies.
     Charles G. Boyd,
       President & CEO, BENS.

  Mr. McCAIN. Finally, I wish to say that there is another ongoing 
battle I will continue to engage in for as long as I am here, and that 
is the earmarking and porkbarreling that goes on in the Defense 
appropriations bill.
  I am proud to have served for many years on the authorizing committee 
of the Armed Services Committee of the Senate. I see year after year, 
time after time, billions of dollars of unwanted, unnecessary 
porkbarrel-earmark spending, many of it having nothing to do with the 
defense of this Nation and the men and women who serve it. I see 
earmark-porkbarrel projects highlighted even as short a time ago as 
yesterday in the Washington Post, and the outrageous abuse of the 
taxpayers' dollars. When Members of Congress were put in Federal 
prison, it was the Defense appropriations bill that was the source of 
some of the corruption.
  So I look forward to passing this to help reform the Pentagon. We 
still need to reform the way the Congress of the United States does 
business in porkbarreling and earmarking scarce taxpayers' dollars that 
should be used to defend this Nation and not for the sources of 
porkbarrel and earmark spending that has become rampant. The last 
Omnibus appropriations bill had 9,000 earmark-porkbarrel projects in 
it, thousands of them on the defense side of the appropriations. It is 
unacceptable. It is outrageous. The American people are sick and tired 
of it. I will continue that fight.
  Again, I thank the distinguished chairman, Senator Levin, for his 
leadership on this legislation.
  I yield the floor.
  Mr. LEVIN. Mr. President, let me again thank Senator McCain for all 
he has done to bring us to the floor today. This is a bipartisan bill. 
It is a major reform of the acquisition system. It is long overdue. It 
is genuinely and desperately needed.
  Mr. McCAIN. Mr. President, I wish to take just a couple minutes to 
discuss the kinds of overruns we are talking about.
  I ask unanimous consent that this report by the GAO of 2009 on major 
weapons programs, changes in costs and quantities for 10 of the highest 
cost acquisition programs, be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

               2009 GAO Report on Major Weapons Programs

            TABLE 2: CHANGES IN COSTS AND QUANTITIES FOR 10 OF THE HIGHEST-COST ACQUISITION PROGRAMS
----------------------------------------------------------------------------------------------------------------
                                                  Total cost (fiscal year       Total quantity       Acquisition
                                                      2009 dollars in     --------------------------  unit cost
                                                         millions)                                  ------------
                    Program                     --------------------------  First full    Current
                                                  First full    Current      estimate     estimate    Percentage
                                                   estimate     estimate                                change
----------------------------------------------------------------------------------------------------------------
Joint Strike Fighter...........................      206,410      244,772        2,866        2,456          *38
Future Combat System...........................       89,776      129,731           15           15          *45
Virginia Class Submarine.......................       58,378       81,556           30           30          *40
F-22A Raptor...................................       88,134       73,723          648          184         *195
C-17 Globemaster III...........................       51,733       73,571          210          190           57
V-22 Joint Services Advanced Vertical Lift            38,726       55,544          913          458         *186
 Aircraft......................................
F/A-18E/F Super Hornet.........................       78,925       51,787        1,000          493           33
Trident II Missile.............................       49,939       49,614          845          561           50
CVN 21 Nuclear Aircraft Class Carrier..........       34,360       29,914            3            3          -13
P-8A Poseidon Multi-mission Maritime Aircraft..       29,974       29,622          115          113            1
 
----------------------------------------------------------------------------------------------------------------
*Enormous cost growth.
 
Source: GAO analysis of DOD data.

  Mr. McCAIN. For the Joint Strike Fighter, the first full estimate was 
that the cost would be $2.866 billion. The current estimate and 
percentage change is a 38-percent increase.
  The Future Combat System was first estimated to cost $89-and-some 
billion. It is now up to $129 billion, a 45-percent increase in cost.
  The Virginia class submarine was originally estimated to be around 
$58 billion. It is now $81 billion, a 40-percent increase.
  The F-22, which will be the subject of debate on the floor of the 
Senate, original cost estimate was $88 billion, and the cost has 
increased by 195 percent.
  The Globemaster has a 57-percent increase, the C-17.
  The V-22 Joint Services Advanced Vertical Lift Aircraft, a 186-
percent increase in cost.
  The list goes on and on, with the exception of the nuclear aircraft 
carrier, which has a 13-percent decrease in cost. We ought to see what 
they are doing.
  The programs GAO reviewed in 2008, the most used initial cost 
estimates from sources previously found to be unreliable, many still 
began with low levels of technical maturity. The promised capabilities 
continued to be delivered later than planned, and 10 of the Pentagon's 
largest programs equaling half of the Department's overall acquisition 
dollars are significantly over budget and under delivery in capability.
  So these are the reasons we are absolutely in need of addressing 
weapons acquisition reform as early and quickly as possible.
  Mr. LEVIN. Mr. President, our staffs have worked hard to try to clear 
some amendments. We have been able to do so. But in order for us to 
move these amendments be adopted, they are going to have to have their 
sponsors come to the floor.
  The nine amendments which have been cleared on both sides and which 
we can accept if we can get the sponsors here would be three amendments 
of Senator McCaskill, one of Senator Collins, one of Senator Coburn, 
one of Senator Whitehouse, one of Senator Carper, one of Senator 
Inhofe, and one of Senator Chambliss.
  These amendments have not been filed yet. We have cleared them but 
they need to be filed by the Senators, and that is the reason we need 
them to come to the floor.
  I will be happy to yield to my colleague.
  Mr. McCAIN. Mr. President, the Chairman explained what is necessary. 
I urge my colleagues to come to the floor, if they have additional 
amendments, so we can finish the bill. It seems to be remarkably free 
of controversy.
  Mr. LEVIN. Mr. President, on a bipartisan basis our committee 
approved this bill unanimously, the Weapon Systems Acquisition Reform 
Act of 2009. We have a few minutes so I will just make a few points 
highlighting this bill.
  The Government Accountability Office reported last month, as both 
Senator McCain and I mentioned earlier, the cost overruns on the 
Department's 97 largest acquisition programs alone totaled almost $300 
billion over the original program estimates. That is true, even though 
the Department of Defense cut the quantities being purchased and they 
reduced the performance expectations on many of the programs in order 
to hold down costs.
  Second, we know what the underlying problems are at the Department of 
Defense. The Department of Defense acquisition programs fail because 
the

[[Page S5214]]

Department continues to rely on unreasonable cost and schedule 
estimates. They continue to establish unrealistic performance 
expectations. The Department continues to use immature technologies and 
to adopt costly changes to program requirements, to production 
quantities, and to funding levels right in the middle of these 
programs. When we do that we have unstable programs and costs that are 
going to rise.
  Third, this bill contains a number of specific measures to address 
the problems I have just identified. The bill has the support of the 
President, Secretary of Defense, the Government Accountability Office, 
many independent experts on acquisition policy, and a number of public 
interest groups. There are many important provisions in this bill, but 
I want to highlight one of them this afternoon.
  We are waiting for sponsors of amendments we have cleared, and those 
that we have not cleared, to come to the floor. We are open for 
business.
  One of the most important provisions that is in this bill is the 
provision which establishes a director of independent cost assessment. 
It is the way to bring real discipline to the DOD's cost estimating 
process. At present, there is an entity called Cost Assessment 
Improvement Group, or CAIG, for short. They are supposed to be 
producing independent cost estimates on DOD acquisition programs. That 
is their responsibility. However, the CAIG operation is too low down in 
the bureaucracy. It is not directly accountable and reporting to the 
Secretary of Defense. It is a committee and includes representatives of 
each of the Under Secretaries and a number of other senior officials in 
the Department, chaired by a civil servant in the Senior Executive 
Service who is the Deputy Director for Resource Analysis in the Office 
of Program Analysis and Evaluation.
  Just almost by saying those words one can understand why it does not 
have the direct clout we need this person to have. We are going to 
establish an individual who is responsible, a person who directly 
reports to the Secretary of Defense just the way in which another 
critically important office now does, the one that evaluates the 
technologies.
  We are also going to have this person be Senate confirmed. The person 
who now is Senate confirmed, who does this for a different role, is the 
Director of Program Analysis and Evaluation. That person, that 
Director, is--I misspoke. It is the Director of Operational Testing and 
Evaluation who now is directly accountable to the Secretary of Defense 
and is Senate confirmed. We want this person who is going to be 
responsible for cost analysis to be also in that same position and to 
have that same kind of clout.
  Now, the CAIG staff does a terrific job at what they do. I am not, in 
any way, disparaging the work of the CAIG staff. But a career official 
in the Senior Executive Service who serves as the Deputy Director of an 
office that is not even headed by a Presidential appointee simply does 
not have the independence and the clout that is essential if the cost 
of these programs is going to be put under control.
  By establishing a tough and an independent cost estimator who is 
Senate confirmed and reports directly to the Secretary of Defense, we 
believe our bill is going to go a long way toward ending the 
unrealistic, the overly optimistic cost assessments that are too often 
used in order to sell the new acquisition programs.
  We have to reduce the unnecessary ``gold plating'' of weapon systems. 
We have to bring the Department of Defense undisciplined requirements 
system under control.
  As I indicated, we are ready to begin addressing amendments.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Arizona is recognized.


                     Republic of Georgia Situation

  Mr. McCAIN. Mr. President, I thank my friend, the distinguished 
chairman of the Committee. I hope we can get these amendments filed as 
quickly as possible. In the meantime, I would like to make a comment 
about the recent situation in the Republic of Georgia.
  It has been just 8 months since the world's attention was riveted by 
Russia's invasion of neighboring Georgia. In the midst of the fighting, 
the United States, the European Union, and the international community 
decried the violence and called on Russia to withdraw its troops from 
sovereign Georgian soil. There was talk of sanctions against Moscow, 
the Bush administration withdrew its submission to Congress of a 
nuclear cooperation agreement with Russia, and NATO suspended meetings 
of the NATO-Russia Council.
  The outrage quickly subsided, however, and it seems that the events 
of last August have been all but forgotten in some quarters. A casual 
observer might guess that things have returned to normal in this part 
of the world, that the war in Georgia was a brief and tragic 
circumstance that has since been reversed.
  But in fact this is not the case. While the stories have faded from 
the headlines, Russia remains in violation of the terms of the 
ceasefire to which it agreed last year, and Russian troops continue to 
be stationed on sovereign Georgian territory. I would like to spend a 
few moments addressing this issue. It bears remembering.
  Last August, following months of escalating tension in the breakaway 
Georgian province of South Ossetia, the Russian military sent tanks and 
troops across the internationally recognized border into South Ossetia. 
It did not stop there, and Moscow also sent troops into Abkhazia, 
another breakaway province, dispatched its Black Sea Fleet to take up 
positions along the Georgian coastline, barred access to the port at 
Poti, and commenced bombing raids deep into Georgian territory. Despite 
an appeal from Georgian officials on August 10, noting the Georgian 
withdrawal from nearly all of South Ossetia and requesting a ceasefire, 
the Russian attacks continued.
  Two days later, the Russian president met with French President 
Nicolas Sarkozy, and ultimately agreed to a six-point ceasefire 
requiring, among other things, that all parties to the conflict cease 
hostilities and pull back their troops to the positions they had 
occupied before the conflict began. Despite this agreement, the Russian 
military continued its operations throughout Georgia, targeting the 
country's military infrastructure and reportedly engaging in widespread 
looting.
  A follow-on ceasefire agreement signed on September 8 by French 
President Sarkozy and Russian President Medvedev required that all 
Russian forces would withdraw from areas adjoining South Ossetia and 
Abkhazia by October 10, but it took just 1 day for Moscow to announce 
that, while it would withdraw its troops to the two provinces, it 
intended to station thousands of Russian soldiers there, in violation 
of its commitment to return those numbers to preconflict levels. Russia 
also recognized the independence of South Ossetia and Abkhazia, the 
only country in the world to do so other than Nicaragua. The leaders of 
both provinces have suggested publicly that they may seek eventual 
unification with Russia.
  Despite the initial international reaction to these moves, the will 
to impose consequences on Russia for its aggression quickly faded. To 
cite one example, the European Parliament agreed on September 3 to 
postpone its talks with Russia on a new partnership agreement until 
Russian troops had withdrawn from Georgia. Just 2 months later, the 
European Union decided to restart those talks. The U.N. Security 
Council attempted to move forward a resolution embracing the terms of 
the ceasefire, but Russia blocked action. The NATO allies suspended 
meetings of the NATO-Russia Council, then decided in March to resume 
them.
  Yet today, Russia remains in violation of its obligations of the 
ceasefire agreement. Thousands of Russian troops remain in South 
Ossetia and Abkhazia, greatly in excess of the preconflict levels. 
Rather than abide by the ceasefire's requirement to engage in 
international talks on the future of the two provinces, Russia has 
recognized their independence, signed friendship agreements with them 
that effectively render them Russian dependencies, and taken over their 
border controls.
  All of this suggests tangible results to Russia's desire to maintain 
a sphere of influence in neighboring countries, dominate their 
politics, and circumscribe their freedom of action in

[[Page S5215]]

international affairs. Just last week, President Medvedev denounced 
NATO exercises currently taking place in Georgia, describing them as 
``provocative.'' These ``provocative'' exercises do not involve heavy 
equipment or arms and focus on disaster response, search and rescue, 
and the like. Russia was even invited to participate in the exercises, 
an invitation Moscow declined.
  We must not revert to an era in which the countries on Russia's 
periphery were not permitted to make their own decisions, control their 
own political futures, and decide their own alliances. Whether in 
Kyrgyzstan, where Moscow seems to have exerted pressure for the 
eviction of U.S. forces from the Manas base, to Estonia, which suffered 
a serious cyberattack some time ago, to Georgia and elsewhere, Russia 
continues its attempts to reestablish a sphere of influence. Yet such 
moves are in direct contravention to the free and open, rules-based 
international system that the United States and its partners have spent 
so many decades to uphold.
  So let us not forget what has happened in Georgia, and what is 
happening there today. I would urge the Europeans, including the French 
President who brokered the ceasefire, to help hold the Russians to its 
terms. And in the United States, where there remain areas of potential 
cooperation with Moscow, from nuclear issues to ending the Iranian 
nuclear program, let us not sacrifice the full independence and 
sovereignty of countries we have been proud to call friends.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Ms. COLLINS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1045

  Ms. COLLINS. Mr. President, the Weapon Systems Acquisition Reform Act 
of 2009, authored by Senators Levin and McCain, would strengthen and 
reform the Department of Defense acquisition process.
  The bill would bring increased accountability, more transparency, and 
cost savings to major defense acquisition programs. Simply put, the 
bill would build discipline into the planning and requirements process, 
keep projects focused, help to prevent cost overruns and schedule 
delays and ultimately save taxpayers' dollars.
  I am very proud to join the chairman and ranking member of the Armed 
Services Committee in cosponsoring this important initiative. I applaud 
their continued efforts to improve procurement at the Pentagon.
  In fiscal year 2008, DOD spending reached $396 billion, approximately 
74 percent of total Federal contract spending. The scope of the 
Department's contract spending is particularly startling when one 
examines closely Army procurement. The number of Army contract actions 
has grown by more than 600 percent since 2001, and contract dollars 
have increased by more than 500 percent.
  In 2007, the Army put on contract one out of every four Federal 
contracting dollars. These figures alone are overwhelming. But they 
actually understate the scope of the procurement challenges at the 
Department of Defense.
  Research, development, testing, evaluation, and procurement of 
increasingly complex weapon systems challenge the Department's ability 
to ensure that taxpayer dollars are wisely spent. Let me give you an 
example: The National Polar Orbiting Operational Environmental 
Satellite System--there is a mouthful--is just one of several Defense 
programs that have been undermined by cost overruns and schedule 
delays.
  This is a complicated program that is required to promote and provide 
a remote sensing capability that is used by the Department of Defense 
and by the National Oceanic and Atmospheric Administration.
  A 2006 report by an inspector general indicated that this one program 
was more than $3 billion over the initial life cycle cost estimates and 
nearly 17 months behind schedule. So here we have an essential program 
that is $3 billion over the initial life cycle cost estimates and it is 
about a year and a half behind schedule. Unfortunately, this is not an 
isolated example. It is but one of many examples of defense 
procurements that have suffered from soaring cost increases and 
unacceptable delays.
  The legislation introduced by Senators Levin and McCain, which I am 
pleased to cosponsor, would improve the Defense Department's planning 
and program oversight in many ways.
  First, the bill would create a new director of independent cost 
assessment to be the principal cost estimation official at the 
Department. The director would be responsible for monitoring and 
reviewing all cost estimates and cost analyses conducted in connection 
with the major defense acquisition programs. Having this set of 
independent eyes on critical but expensive programs would help to 
prevent wasteful spending. It would help to ensure that when we embark 
on a new defense acquisition, we truly have confidence in the cost 
estimates.
  The bill also mandates that the Department carefully balance cost, 
schedule, and performance as part of the requirements development 
process. These reforms would build important discipline into the 
procurement process long before a request for proposals is issued and a 
contract is awarded. By carefully considering the needs of the program 
office, the associated requirements and estimated cost of a program, 
and the risks inherent in system development and deployment, the 
Department will be able to make much more rational decisions about its 
investments and use more effective contracting vehicles for 
procurements long before taxpayer dollars are committed to the project.
  I also applaud the bright lines this legislation would establish 
regarding organizational conflicts of interest by defense contractors. 
These reforms would strengthen the wall between Government employees 
and contractors, helping to ensure that ethical boundaries are 
respected. While certainly private sector contractors are vital 
partners with military and civilian employees at the Department of 
Defense, their roles and responsibilities must be well defined and free 
of conflicts of interest as they undertake their critical work 
supporting our Nation's military.
  What we are finding--and we have had oversight hearings in the 
Homeland Security Committee on this issue--is that in the Department of 
Homeland Security and the Department of Defense, in some cases we have 
defense contractors involved in setting requirements, defining 
requirements for projects on which subsidiaries of those defense 
contractors may well be bidding. We want to avoid those kinds of 
conflicts of interest which impair confidence in the integrity of the 
process.
  We also want to make sure we are following current law as far as 
activities that should be done in-house because they are inherently 
governmental.
  I note, too, that this legislation encourages the Department to 
reinvest personnel resources in systems engineers--a necessary element 
for any successful acquisition reform of the Department's major weapon 
systems programs. Without experienced, well-trained engineers, the 
Department will be unable to set definitive requirements during the 
planning process, incapable of effectively testing and evaluating the 
development of these systems, and ineffective in addressing systems 
defects in the incredibly complex programs in which the Department, of 
necessity, invests. The lack of systems engineers also prevents strong 
program oversight, as the limited number of engineers available simply 
cannot focus sufficient time and attention on the programs as they are 
constantly pulled in multiple directions.
  Adding systems engineers is only one part of the overall personnel 
reforms necessary to improve the acquisition process. DOD must also 
invest significantly in its undermanned acquisition workforce.
  The dramatic downsizing of the defense acquisition workforce during 
the 1990s was followed by an even more dramatic increase in workload. 
So at the time that the Defense Department's acquisition workforce was 
declining, the workload was increasing. In fiscal year 2001, the 
Department spent $138 billion on contracts. Seven years later, DOD

[[Page S5216]]

spending reached $396 billion--a 187-percent increase. Of that amount, 
$202 billion was for the procurement of services. That requires labor-
intensive acquisition management and oversight. Needless to say, these 
factors have greatly strained the defense acquisition workforce and 
greatly increased the risk of acquisition failure. At the same time, a 
significant increase in the use of contractor acquisition support 
personnel has added another layer of complexity as the Department must 
manage both organizational and personal conflicts of interest.
  I commend Secretary Gates for recognizing just how important these 
workforce issues are. Under his leadership, the Department has set 
forth an aggressive program for strengthening the acquisition 
workforce, including increasing the number of acquisition personnel and 
improving their training. The Secretary has proposed increasing the 
workforce by 15 percent through 2015. That amounts to approximately 
20,000 new employees. I also praise the Secretary for not only adding 
additional personnel but for thinking about what they should be doing. 
For example, he has proposed that some of these new employees take over 
tasks that are currently being performed by defense contractors. That 
is that conflict-of-interest issue I mentioned earlier. If the 
Secretary's plan goes through--and I am going to support him strongly 
in this regard--the acquisition workforce would increase to numbers not 
seen in a decade. That will save money and improve acquisition 
outcomes.
  But this isn't just a numbers game. In addition to having a 
sufficient number of personnel, the Department must have the right mix. 
I am pleased that the Secretary has proposed 600 additional auditors 
for DCAA, the Defense Contract Audit Agency, and additional engineers 
and technical experts.
  These acquisition changes will help to prevent contracting waste, 
fraud, abuse, and mismanagement. Most of all, they are absolutely 
essential to the effective implementation of the procurement reforms in 
this bill. We can write the best laws. We can impose the strongest 
reforms. But if we do not have sufficient personnel, well-trained 
employees to carry out these reforms, our efforts will be for naught.
  I now call up an amendment I have at the desk. It is amendment No. 
1045.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       The Senator from Maine [Ms. Collins], for herself and Mrs. 
     McCaskill, proposes an amendment numbered 1045.

  Ms. COLLINS. I ask unanimous consent that reading of the amendment be 
dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:


                           amendment no. 1045

 (Purpose: To require the Secretary of Defense to apply uniform earned 
    value management standards to reliably and consistently measure 
contract performance, and to ensure that contractors establish and use 
               approved earned value management systems)

       On page 69, after line 2, add the following:

     SEC. 207. EARNED VALUE MANAGEMENT.

       (a) Enhanced Tracking of Contractor Performance.--Not later 
     than 180 days after the date of the enactment of this Act, 
     the Under Secretary of Defense for Acquisition, Technology, 
     and Logistics shall review the existing guidance and, as 
     necessary, prescribe additional guidance governing the 
     implementation of the Earned Value Management (EVM) 
     requirements and reporting for contracts to ensure that the 
     Department of Defense--
       (1) applies uniform EVM standards to reliably and 
     consistently measure contract or project performance;
       (2) applies such standards to establish appropriate 
     baselines at the award of a contract or commencement of a 
     program, whichever is earlier;
       (3) ensures that personnel responsible for administering 
     and overseeing EVM systems have the training and 
     qualifications needed to perform this function; and
       (4) has appropriate mechanisms in place to ensure that 
     contractors establish and use approved EVM systems.
       (b) Enforcement Mechanisms.--For the purposes of subsection 
     (a)(4), mechanisms to ensure that contractors establish and 
     use approved EVM systems shall include--
       (1) consideration of the quality of the contractors' EVM 
     systems and the timeliness of the contractors' EVM reporting 
     in any past performance evaluation for a contract that 
     includes an EVM requirement; and
       (2) increased government oversight of the cost, schedule, 
     scope, and performance of contractors that do not have 
     approved EVM systems in place.

  Ms. COLLINS. Mr. President, this amendment, which I am offering along 
with my distinguished colleague, Senator McCaskill, who has brought 
great auditing skills to this body, would help to ensure that the 
Department is supplying certain critical principles consistently and 
reliably to all projects that use a specific management tool that is 
known as EVM, earned value management. The Department currently 
requires EVM tracking for all contracts that exceed $20 million. This 
provides important visibility into the scope, schedule, and cost in a 
single integrated system. When properly applied, this system can 
provide an early warning of performance problems. The Government 
Accountability Office has observed, however, that contractor reporting 
on EVM often lacks consistency, leading to inaccurate data and faulty 
application of this metric. In other words, this is a garbage-in/
garbage-out problem that we need to correct.
  To address this challenge, our amendment would provide enforcement 
mechanisms to ensure that contractors establish and use approved EVM 
systems, and we would require the Department of Defense to consider the 
quality of the contractor's EVM systems and reporting in the past 
performance evaluation for a contract. When a contractor is bidding, 
the contracting official looks at any past performance. With improved 
data quality, both the Government and the contractor will be able to 
improve program oversight, leading to better acquisition outcomes.
  This is so important. Some of the provisions that are particularly 
important in the Levin-McCain bill would increase transparency and 
oversight so that if an acquisition process is going in the wrong 
direction, we know about it and are able to take action. We are able to 
decide whether the Nunn-McCurdy breaches, for example, warrant halting 
the project. We are improving the cost estimate system for weapons 
acquisition projects. We have a lot of reforms. This would increase our 
transparency, our ability to flag problems.
  I believe this amendment Senator McCaskill and I offer would help to 
strengthen the Department's acquisition planning, increase and improve 
program oversight, and help to prevent contracting waste, fraud, and 
mismanagement.
  Let me end my comments by reminding all of us why this bill and our 
amendment are so important.
  Ultimately, these procurement reforms will help ensure that our brave 
men and women in uniform--our military personnel--have the equipment 
they need when they need it, that it performs as promised, and that our 
tax dollars are not wasted on programs that are doomed to fail.
  Thank you, Mr. President.
  The PRESIDING OFFICER. The Senator from Michigan.
  Mr. LEVIN. Mr. President, before the Senator from Maine leaves the 
floor, let me congratulate her on this amendment. She has put her 
finger on a very significant point. There is a weakness in this system 
of contract oversight that the Department of Defense has not 
satisfactorily addressed.
  As frequently happens, the Senator from Maine is willing to take on 
issues which are not necessarily the most glamorous and do not 
necessarily get the headlines but really get to the inside of what 
needs to be delved into, needs to be looked at, needs to be analyzed, 
and needs to be addressed.
  This is an amendment which will require the Department of Defense to 
use a management tool which is called earned value management. They 
acknowledge it is an important tool, but they also acknowledge too 
often contractors are not using it and that Government officials who 
are responsible for overseeing this system and this management tool are 
inadequately trained, not qualified. There are inadequate mechanisms to 
enforce contractor compliance.
  So the Senator from Maine, as she so often does, has put her finger 
on a critical issue and is willing to tackle it and make it 
understandable for the rest of us. I commend her and Senator McCaskill 
for this amendment, and we are delighted to support it.

[[Page S5217]]

  The PRESIDING OFFICER (Mr. Burris). The Senator from Maine.
  Ms. COLLINS. Mr. President, I thank the chairman for his thoughtful 
comments and for working with us on this amendment. I hope at the 
appropriate time it can be adopted. I believe it is acceptable to 
Senator McCain. But I am unclear whether there is further clearance 
that needs to be done.
  But, again, while the Senator is on the floor, I want to once again 
praise Senator Levin and Senator McCain for tackling this critical 
issue. It is complex. And it is important that the reforms make a 
difference to our military--to those who need these weapon systems, who 
need the material and the supplies that the contracting is procuring. 
It is also important that taxpayers be protected. There have been far 
too many cost overruns and schedule delays that hurt those who are on 
the front lines, quite literally.
  I praise and thank the chairman again for his leadership in this 
area.
  Thank you, Mr. President.
  Mr. LEVIN. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Ms. COLLINS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Ms. COLLINS. Mr. President, I am informed that the amendment I have 
offered with Senator McCaskill, which is the pending amendment, No. 
1045, has been cleared on our side.
  The PRESIDING OFFICER. The Senator from Michigan.
  Mr. LEVIN. Mr. President, we very strongly support the amendment and 
hope it will be acted upon immediately.
  The PRESIDING OFFICER. Is there further debate on the amendment?
  If not, the question is on agreeing to the amendment.
  The amendment (No. 1045) was agreed to.
  Mr. LEVIN. Mr. President, I move to reconsider the vote.
  Ms. COLLINS. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Ms. COLLINS. Thank you, Mr. President. And I thank the chairman.
  Mr. LEVIN. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. DORGAN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. Mr. President, I have come to the floor to speak about a 
couple of issues that relate to the Department of Defense and to 
defense issues, but I want to especially today talk about the work that 
has been done by my colleague, Senator Levin, and my colleague from 
Arizona. The work they have done on procurement reform is very 
important.
  I listened to some of the presentations earlier today by Senator 
Levin and Senator McCain about the overruns in various weapons 
programs, the cost overruns, and the significant dislocations with 
respect to decisions that have been made or not made with certain 
weapons programs.
  I think there is real need for reform, and the bill they have brought 
to the floor of the Senate is a great service to the American taxpayer. 
I think it is also a great service to our defense structure. We have 
limited funds. We have to use them effectively. We have to fund weapons 
programs that are essential to the defense strength of this country. 
That is what both of my colleagues are saying. And they are saying, 
when we have a program that has outlived its usefulness, a program that 
has cost overruns that never stop and seem completely out of control, 
we have to address that and deal with it and respond to it.
  So we have been going through a long period here of unbelievable cost 
overruns in some programs without much notice and without much action 
attending to it. I think my two colleagues are doing a great service. I 
hope, as I know the chairman does, we will be able to move quickly to 
address this legislation, perhaps without even amendments, and go 
forward and get it through the Senate. We will have done, I think, a 
great service to strengthen our defense capability and protect the 
American taxpayer at the same time.


                          Defense Duplication

  Mr. President, I want to raise an issue that does not directly relate 
to this bill but relates to all the considerations of this bill because 
it is a follow-on and one I think we will deal with in the next bill, 
defense authorization. That bill will also be chaired on the floor of 
the Senate by my colleague, Senator Levin. It deals with the issue of 
duplication.

  In addition to contract and procurement reform--in this case 
procurement reform--the issue of duplication of our services at the 
Department of Defense is a very important issue. Every service wants to 
do everything. That is just the way it is. I wish to give an example of 
something I have been working on, so far unsuccessfully, but I am going 
to raise it and push it during Defense authorization because it relates 
to the very same things that my colleagues have talked about today.
  These are pictures of unmanned aerial vehicles; UAVs they are called. 
It is sort of the new way to fly, particularly over a battlefield for 
reconnaissance purposes and so on. Many of us are familiar with what is 
called the Predator B, which the Air Force refers to as the Reaper. 
That is this airplane. The Predator B is used extensively and has been 
used extensively in the war theater in Afghanistan and in Iraq and in 
that region. It is an unmanned aerial vehicle, unmanned aerial aircraft 
without a pilot. The pilot sits on the ground someplace in a little 
thing that looks almost like a trailer house, and they are flying this 
aircraft. In some cases, the pilot is 6,000, 8,000 miles away from 
where the aircraft is, flying it at a duty station perhaps at a 
National Guard base or somewhere else.
  But, anyway, the Air Force has what is called the Predator. That is 
built by General Atomics, and it is a worthwhile program that has 
provided great service to us and to our country in terms of our defense 
capability.
  This, by the way, is called the Sky Warrior. This is the Reaper. It 
is owned by the Air Force. This is the Sky Warrior. That is the U.S. 
Army.
  Why does it look alike? Well, it is because it is made by the same 
company. It is made to different specifications because the Army wants 
a slightly different vehicle, but the Air Force has the Predator B, and 
the Army has the Sky Warrior.
  Why does the Army have a Sky Warrior? Well, because they want to run 
their own reconnaissance. So what we have in these circumstances is, 
the Army, in the next 5 years, wants to spend $800 million to buy more 
than 100 of the Sky Warriors, and eventually they want to have 500 Sky 
Warriors. The Air Force wants to spend $1.5 billion to buy 150 more 
Predators, Predator Bs.
  Here is what the Predator B and the Sky Warrior look like. As you can 
see, they are nearly identical. Both carry intelligence, surveillance, 
and reconnaissance sensors so they can find and track targets on the 
ground. Both can fire missiles so they can hit a target they might 
find, both can fly over 25,000 feet high for more than 30 hours which 
gives them range and endurance, but it seems to me a complete 
duplication of effort.
  We are not talking about just the UAV mission itself; we are talking 
about the duplication of acquisition programs--engineering, 
contracting. I don't understand it.
  For years, the Air Force used U-2s, F-15s, F-16s, even B-52s from 
time to time to provide surveillance, intelligence, reconnaissance, and 
close air support for the Army. They used manned aircraft to provide 
all of those services for the U.S. Army. It is not clear why that ought 
to be different just because we are using unmanned aircraft.
  The Army says they plan to assign each set of 12 Sky Warriors to a 
specific combat unit. Of course, since most combat units in the Army 
are at their home base at any given time, most Sky Warriors will be 
based in the United States or perhaps Europe at any given time. The Air 
Force has a different approach. They have a streamlined operation 
concept. They have been working nearly 8 years in almost constant 
combat operations, and almost every single

[[Page S5218]]

Air Force Predator is at this point in the Central Command of 
Operations--CENTCOM.
  It seems to me the services ought to do what they do best. What the 
Army does best is fight a war on the ground. What the Air Force does 
best is to provide timely intelligence, surveillance, and 
reconnaissance for the troops on the ground and to attack ground 
targets from the air. That is what each does best.
  However, the Army wants to do exactly what the Air Force does and 
have a separate acquisition program to do so.
  So we ought to be asking the question: Does this make sense to send 
thousands of airmen to Iraq and Afghanistan to be truck drivers in Army 
convoys while the Army plans to have thousands of troops operating 
unmanned aircraft? Yes, that is happening. Putting all of our large 
UAVs under the Air Force will result, in my judgment, in streamlined 
and more efficient acquisition of UAVs and allow the Army to 
concentrate its manpower on Army tasks.
  Let me be clear. There are some surveillance--at low-altitude, over-
the-battlefield surveillance with unmanned aircraft--that are just fine 
at 500 feet, 1,000 feet with various kinds of unmanned devices. I 
understand why the Army would want to operate that, and should. 
However, I don't understand the Army flying at 25,000 or 30,000 feet, a 
duplicate mission for which the Air Force exists.
  So given the budget problems we face, with nondiscretionary and 
discretionary spending, we can't afford duplication of effort.
  A few years ago, the Air Force proposed that it be designated as the 
executive agent for all medium- and high-altitude unmanned aerial 
vehicles. That made sense to me. The Air Force is the logical choice. 
They already have the infrastructure to deliver that combat power.
  In 2007, by the way, the Pentagon's Joint Requirements Oversight 
Council endorsed that proposal, but the proposal didn't go anywhere 
because of intense opposition from the Army and those who support the 
Army in this Congress.
  I don't think this should be an intramural debate between supporting 
the Army and supporting the Air Force. I support both. I want the Army 
to be equipped in an unbelievably important way to do its mission, and 
I want the Air Force to be similarly equipped. I just don't want the 
taxpayer to be paying for duplication of effort, and I don't want every 
service to believe it should do everything because that clearly is a 
duplication of effort.
  The legislation that is before us today is about procurement reform, 
procurement reform itself. It does not address this specific issue of 
duplication, but this issue is certainly the second cousin to it. We 
will be discussing this when we get to the Defense authorization bill, 
and that, too, is a very important part of how we can strengthen our 
defense; how do we make certain the taxpayers are getting their money's 
worth; and how do we make certain the men and women who serve in 
defense of this country are equipped to do what they do best.
  I raise this issue of duplication because I think it is so important 
that we find a way to begin to unravel the unmistakable duplication 
that exists in so many areas within the Pentagon. This is one that 
should be self-evident to virtually everyone.
  I wish to mention as well today the issue that will also come up in 
Defense authorization that is the first or second cousin to procurement 
reform, and that is contracting reform. I know my colleague from 
Michigan and my colleague from Arizona are very concerned about this as 
well, and I look forward to working with them on the Defense 
authorization bill.
  A couple of points about contract reform: I have held, I believe, 18 
hearings in the Democratic Policy Committee that I chair on contracting 
issues over a good number of years now. I wish to show a couple of 
photographs that describe some of the unbelievable circumstances that 
have existed and that we must take steps to correct, and I know my 
colleagues, the chairman and ranking member, are already doing so.
  This, by the way, deals with contracting. I understand during wartime 
there are going to be contracts sometimes that are let without a lot of 
scrutiny and somebody is going to make a lot of money, or perhaps 
somebody doesn't quite measure up, but this is different. I think we 
have seen some of the greatest waste, fraud, and abuse in the history 
of this country in contracting.
  This is a picture of a couple million dollars wrapped in Saran wrap, 
a couple of million dollars in cash. Franklin Willis is the guy with 
the white shirt. He is holding one of these. This happens to be in a 
palace in Iraq, one of Saddam's palaces. I assume the chairman of the 
committee has been in one of Saddam's palaces. I have been in one of 
Saddam's palaces in Baghdad. So we took over all of those palaces for 
headquarters, or a good many of them. This happens to be a couple of 
million dollars in cash put on a table because the contractor was 
coming to pick up the cash. Franklin Willis--a very respected guy, by 
the way, who went over from the Federal Government to work on these 
issues and testified in one of my hearings--said the word was to 
contractors: Bring a bag because we pay cash.

  We were contracting for everything in Iraq. Just all kinds--they had 
over 130,000 contractors, I believe, at one point. So the company who 
was going to pick up this cash, by the way, was later indicted in 
criminal court. But Franklin Willis was showing us how reimbursements 
were made in Iraq. This is bills wrapped in Saran wrap. He would say 
from time to time he would see people playing football catch with 100-
dollar bills wrapped in Saran wrap waiting for the contractors to bring 
a bag, to pick up a couple million dollars on this day.
  It is not an isolated problem that the contractor that was going to 
show up to pick up this money was later convicted--indicted and 
convicted--in a U.S. court for stealing millions of taxpayers' dollars. 
Franklin Willis said it was just like the old Wild West. That is what 
he said to us: It was like the Wild West. Bring a bag. We have cash.
  So during this period of time, in Baghdad, as they began to try to 
set up a provisional government--which was the U.S. Government trying 
to set up a government, and we sent Ambassador Bremer over to set up a 
government--during that time, we know that pallets of cash were shipped 
to Iraq. This cash left the Federal Reserve Bank in New York. This 
pallet, each pallet, contains 640 bundles of 1,000-dollar bills and 
weighs 1,500 pounds. They sent 484 of these pallets to Iraq on C-130s. 
That is more than 363 tons of cash that was sent to Iraq in C-130s, 
totaling $12 billion. Think of that: $12 billion with reports of 
distributing cash onto the back of pickup trucks. Do you wonder why we 
were stolen blind?
  A woman who has had a substantial amount of experience who has never 
gotten her due, but one of the most courageous women I have met in 
Washington, DC, Bunny Greenhouse, and for her testimony and for her 
courage she lost her job. Here is what she said. She was the former 
chief contracting officer at the Corps of Engineers. She was the top 
civilian working for the Army Corps of Engineers, and she was in the 
room when the logcap project was negotiated.
  Let me describe to you what she said. This is the top civilian 
official in the U.S. Army Corps of Engineers. She had 25 years of great 
service to our country with two masters degrees, unbelievable 
qualifications, and performance appraisals that said she was 
outstanding every single time--until she spoke publicly.
  Here is what she said:

       I can unequivocally state that the abuse related to the 
     contracts awarded to Kellogg, Brown & Root--

  A subsidiary of Halliburton--

     represents the most blatant and improper contract abuse I 
     have witnessed during the course of my professional career.

  For that, this woman was demoted and lost her job; for the courage to 
speak out, she lost her job. Pretty unbelievable. This is an 
extraordinary woman.
  We have seen from all of these circumstances unbelievable waste in 
contracting. It is not just--it is what Bunnatine Greenhouse said, the 
way the contracts were negotiated. She said they were illegal and so 
on.
  Let me give an example, and I could give 100 examples. This shows $40 
million spent on a prison in Iraq they

[[Page S5219]]

called the whale. This is when most of the money had already been 
spent. You can see there is virtually nothing done. The Parsons 
Corporation got that money. This now sits empty, never having been 
used. A top floor was never finished. The U.S. Government says: Well, 
we gave it to the Iraqis.
  The Iraqi Government says: Are you kidding me? We wouldn't take that 
in a million years. We don't want the prison. We would not use the 
prison. It was never given to us.
  So $40 million was spent of the taxpayers' money. Procurement reform 
and contractor reform are all related. I don't want to come and provide 
a message that steps in any way on anything that the chairman is doing 
on procurement reform because that is critically important.
  We have to follow it with its first cousin, contract reform. The 
stories are so legend. In this photo is a young man who was killed. He 
was a Ranger and a Green Beret. He was electrocuted while taking a 
shower. This is his mother Cheryl. He was electrocuted because KBR got 
the contract for wiring facilities in Iraq and didn't do a good job. He 
was killed in a shower. Another man was power washing a Jeep or humvee 
and got electrocuted. The Army said: We think he took a radio or an 
electrical device into the shower. But he didn't.
  It is not just this, but it is providing water to military bases that 
was more contaminated than the Euphrates River.
  I will be on the floor when we come to defense authorization with a 
good number of amendments on contracting reform because we have to put 
a stop to this. It has gone on way too long.
  Let me finish by coming back to where I started, and that is the 
issue of procurement reform. Our colleagues on the Defense 
Authorization Committee are trying to deal with virtually unlimited 
wants and resources. That is not new. We understand the problems that 
creates. So they have decided they have to put together procurement 
reform legislation. It is so important to this country to get this done 
and to get it right. Procurement reform is essential. It is the 
foundation of fixing the problems that exist with respect to these 
major weapons programs.
  Then, I hope we can segue into contracting reform and the issues of 
duplication, on which I wish to work with the chairman and ranking 
member. I thank Senators Levin and McCain for their leadership. I 
requested that I be made a cosponsor of the procurement reform 
legislation. I look forward to visiting and working with them on 
amendments on contracting reform in the coming month or two, when we 
get to the defense authorization.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Michigan is recognized.
  Mr. LEVIN. Mr. President, let me very quickly thank Senator Dorgan 
for his extraordinary commitment to the issues he has outlined. I don't 
know of anybody in this body who has devoted anywhere near the time he 
has to these issues. He has a passion second to none, and I commend him 
for it. We look forward to working with him on amendments on the 
authorization bill, and we also more than welcome his cosponsorship of 
the pending bill. I thank him for the effort he made.
  I assume all the materials he has produced will go to the Commission 
on Contracting Reform, which has been created on wartime contracting. 
That will probably give us an opportunity, with the power they have, to 
take some concrete steps. I thank the Senator.
  The PRESIDING OFFICER. The Senator from Arizona is recognized.
  Mr. McCAIN. Mr. President, I believe we have cleared some amendments.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant bill clerk proceeded to call the roll.
  Mr. LEVIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


Amendments Nos. 1044, 1053, 1046, 1051, 1049, 1050, 1047, and 1048, En 
                                  Bloc

  Mr. LEVIN. Mr. President, Senator McCain and I now, with our staffs, 
have been able to clear eight amendments.
  I ask unanimous consent that the following amendments be called up, 
considered, and approved en bloc: amendment No. 1044, by Senator 
Inhofe, which he will speak on; amendment No. 1053, Senator Chambliss; 
Senator Coburn's amendment No. 1046; Senator McCaskill's amendments 
numbered 1051, 1049, and 1050; Senator Whitehouse's amendment No. 1047; 
Senator Carper's amendment No. 1048.
  The PRESIDING OFFICER. Without objection, the amendments are 
considered en bloc and are agreed to.
  The amendments were agreed to as follows:


                           amendment no. 1044

(Purpose: To require a report on certain cost growth matters following 
  the termination of a major defense acquisition program for critical 
                              cost growth)

       On page 59, line 25, strike ``(D)'' and inserting ``(E)''.
       On page 60, strike line 3 and insert the following:
       lowing new subparagraphs (B), (C), and (D):
       On page 60, line 4, insert ``and submit the report required 
     by subparagraph (D)'' after ``terminate such acquisition 
     program''.
       On page 61, strike like 24 and insert the following:
       gram;
       ``(D) if the program is terminated, submit to Congress a 
     written report setting forth--
       ``(i) an explanation of the reasons for terminating the 
     program;
       ``(ii) the alternatives considered to address any problems 
     in the program; and
       ``(iii) the course the Department plans to pursue to meet 
     any continuing joint military requirements otherwise intended 
     to be met by the program; and''.


                           amendment no. 1053

(Purpose: To clarify an exception to conflict of interest requirements 
     applicable to contracts for systems engineering and technical 
                         assistance functions)

       On page 63, line 11, insert ``for special security 
     agreements'' after ``to those required''.


                           amendment no. 1046

  (Purpose: To require reports on the operation and support costs of 
     major defense acquisition programs and major weapons systems)

       On page 49, strike line 15 and all that follows through 
     page 51, line 8, and insert the following:

     view, including an assessment by the Director of the 
     feasibility and advisability of establishing baselines for 
     operating and support costs under section 2435 of title 10, 
     United States Code.
       (2) Transmittal to congress.--Not later than 30 days after 
     receiving the report required by paragraph (1), the Secretary 
     shall transmit the report to the congressional defense 
     committees, together with any comments on the report the 
     Secretary considers appropriate.
       (c) Transfer of Personnel and Functions of Cost Analysis 
     Improvement Group.--The personnel and functions of the Cost 
     Analysis Improvement Group of the Department of Defense are 
     hereby transferred to the Director of Independent Cost 
     Assessment under section 139d of title 10, United States Code 
     (as so added), and shall report directly to the Director.
       (d) Conforming Amendments.--
       (1) Section 181(d) of title 10, United States Code, is 
     amended by inserting ``the Director of Independent Cost 
     Assessment,'' before ``and the Director''.
       (2) Section 2306b(i)(1)(B) of such title is amended by 
     striking ``Cost Analysis Improvement Group of the Department 
     of Defense'' and inserting ``Director of Independent Cost 
     Assessment''.
       (3) Section 2366a(a)(4) of such title is amended by 
     striking ``has been submitted'' and inserting ``has been 
     approved by the Director of Independent Cost Assessment''.
       (4) Section 2366b(a)(1)(C) of such title is amended by 
     striking ``have been developed to execute'' and inserting 
     ``have been approved by the Director of Independent Cost 
     Assessment to provide for the execution of''.
       (5) Section 2433(e)(2)(B)(iii) of such title is amended by 
     striking ``are reasonable'' and inserting ``have been 
     determined by the Director of Independent Cost Assessment to 
     be reasonable''.
       (6) Subparagraph (A) of section 2434(b)(1) of such title is 
     amended to read as follows:
       ``(A) be prepared or approved by the Director of 
     Independent Cost Assessment; and''.
       (7) Section 2445c(f)(3) of such title is amended by 
     striking ``are reasonable'' and inserting ``have been 
     determined by the Director of Independent Cost Assessment to 
     be reasonable''.
       (e) Comptroller General of the United States Review of 
     Operating and Support Costs of Major Weapon Systems.--
       (1) In general.--Not later than one year after the date of 
     the enactment of this Act, the Comptroller General of the 
     United States shall submit to the congressional defense 
     committees a report on growth in operating and support costs 
     for major weapon systems.
       (2) Elements.--In preparing the report required by 
     paragraph (1), the Comptroller General shall, at a minimum--
       (A) identify the original estimates for operating and 
     support costs for major weapon systems selected by the 
     Comptroller General for purposes of the report;
       (B) assess the actual operating and support costs for such 
     major weapon systems;

[[Page S5220]]

       (C) analyze the rate of growth for operating and support 
     costs for such major weapon systems;
       (D) for such major weapon systems that have experienced the 
     highest rate of growth in operating and support costs, assess 
     the factors contributing to such growth;
       (E) assess measures taken by the Department of Defense to 
     reduce operating and support costs for major weapon systems; 
     and
       (F) make such recommendations as the Comptroller General 
     considers appropriate.
       (3) Major weapon system defined.--In this subsection, the 
     term ``major weapon system'' has the meaning given that term 
     in 2379(d) of title 10, United States Code.


                           amendment no. 1051

    (Purpose: To enhance the review of joint military requirements)

       On page 53, between lines 17 and 18, insert the following:
       (c) Review of Joint Military Requirements.--
       (1) JROC submittal of recommended requirements to under 
     secretary for atl.--Upon recommending a new joint military 
     requirement, the Joint Requirements Oversight Council shall 
     transmit the recommendation to the Under Secretary of Defense 
     for Acquisition, Technology, and Logistics for review and 
     concurrence or non-concurrence in the recommendation.
       (2) Review of recommended requirements.--The Under 
     Secretary for Acquisition, Technology, and Logistics shall 
     review each recommendation transmitted under paragraph (1) to 
     determine whether or not the Joint Requirements Oversight 
     Council has, in making such recommendation--
       (A) taken appropriate action to solicit and consider input 
     from the commanders of the combatant commands in accordance 
     with the requirements of section 181(e) of title 10, United 
     States Code (as amended by section 105);
       (B) given appropriate consideration to trade-offs among 
     cost, schedule, and performance in accordance with the 
     requirements of section 181(b)(1)(C) of title 10, United 
     States Code (as amended by subsection (b)); and
       (C) given appropriate consideration to issues of joint 
     portfolio management, including alternative material and non-
     material solutions, as provided in Chairman of the Joint 
     Chiefs of Staff Instruction 3170.01G.
       (3) Non-concurrence of under secretary for atl.--If the 
     Under Secretary for Acquisition, Technology, and Logistics 
     determines that the Joint Requirements Oversight Council has 
     failed to take appropriate action in accordance with 
     subparagraphs (A), (B), and (C) of paragraph (2) regarding a 
     joint military requirement, the Under Secretary shall return 
     the recommendation to the Council with specific 
     recommendations as to matters to be considered by the Council 
     to address any shortcoming identified by the Under Secretary 
     in the course of the review under paragraph (2).
       (4) Notice on continuing disagreement on requirement.--If 
     the Under Secretary for Acquisition, Technology, and 
     Logistics and the Joint Requirements Oversight Council are 
     unable to reach agreement on a joint military requirement 
     that has been returned to the Council by the Under Secretary 
     under paragraph (4), the Under Secretary shall transmit 
     notice of lack of agreement on the requirement to the 
     Secretary of Defense.
       (5) Resolution of continuing disagreement.--Upon receiving 
     notice under paragraph (4) of a lack of agreement on a joint 
     military requirement, the Secretary of Defense shall make a 
     final determination on whether or not to validate the 
     requirement.

       On page 53, line 18, strike ``(c)'' and insert ``(d)''.

       On page 54, line 12, strike ``(d)'' and insert ``(e)''.


                           amendment no. 1049

(Purpose: To specify certain inputs to the Joint Requirements Oversight 
Council from the commanders of the combatant commands on joint military 
                             requirements)

       On page 51, line 12, insert ``(a) In General.--'' before 
     ``Section 181''.
       On page 51, line 23, strike ``of subsection (f).''.'' and 
     insert the following: ``of subsection (f). Such input may 
     include, but is not limited to, an assessment of the 
     following:
       ``(1) Any current or projected missions or threats in the 
     theater of operations of the commander of a combatant command 
     that would justify a new joint military requirement.
       ``(2) The necessity and sufficiency of a proposed joint 
     military requirement in terms of current and projected 
     missions or threats.
       ``(3) The relative priority of a proposed joint military 
     requirement in comparison with other joint military 
     requirements.
       ``(4) The ability of partner nations in the theater of 
     operations of the commander of a combatant command to assist 
     in meeting the joint military requirement or to partner in 
     using technologies developed to meet the joint military 
     requirement.''.
       (b) Comptroller General of the United States Review of 
     Implementation.--Not later than two years after the date of 
     the enactment of this Act, the Comptroller General of the 
     United States shall submit to the Committees on Armed 
     Services of the Senate and the House of Representatives a 
     report on the implementation of the requirements of 
     subsection (e) of section 181 of title 10, United States Code 
     (as amended by subsection (a)), for the Joint Requirements 
     Oversight Council to solicit and consider input from the 
     commanders of the combatant commands. The report shall 
     include, at a minimum, an assessment of the extent to which 
     the Council has effectively sought, and the commanders of the 
     combatant commands have provided, meaningful input on 
     proposed joint military requirements.


                           amendment no. 1050

  (Purpose: To provide for a review by the Comptroller General of the 
United States of waivers of the requirement for competitive prototypes 
                        based on excessive cost)

       On page 59, strike line 15 and insert the following:
       (d) Comptroller General of the United States Review of 
     Certain Waivers.--
       (1) Notice to comptroller general.--Whenever a milestone 
     decision authority authorizes a waiver of the requirement for 
     prototypes under paragraph (1) or (2) of subsection (c) on 
     the basis of excessive cost, the milestone decision authority 
     shall submit a notice on the waiver, together with the 
     rational for the waiver, to the Comptroller General of the 
     United States at the same time a report on the waiver is 
     submitted to the congressional defense committees under 
     paragraph (3) of that subsection.
       (2) Comptroller general review.--Not later than 60 days 
     after receipt of a notice on a waiver under paragraph (1), 
     the Comptroller General shall--
       (A) review the rationale for the waiver; and
       (B) submit to the congressional defense committees a 
     written assessment of the rationale for the waiver.
       (e) Applicability.--This section shall apply to any


                           amendment no. 1047

    (Purpose: To further improve the cost assessment procedures and 
                processes of the Department of Defense)

       On page 43, between lines 20 and 21, insert the following:
       (c) Technological Maturity Standards.--For purposes of the 
     review and assessment conducted by the Director of Defense 
     Research and Engineering in accordance with subsection (c) of 
     section 139a of title 10, United States Code (as added by 
     subsection (a)), a critical technology is considered to be 
     mature--
       (1) in the case of a major defense acquisition program that 
     is being considered for Milestone B approval, if the 
     technology has been demonstrated in a relevant environment; 
     and
       (2) in the case of a major defense acquisition program that 
     is being considered for Milestone C approval, if the 
     technology has been demonstrated in a realistic environment.
       On page 45, beginning on line 9, strike ``programs and 
     require the disclosure of all such confidence levels;'' and 
     insert ``programs, require that all such estimates include 
     confidence levels compliant with such guidance, and require 
     the disclosure of all such confidence levels (including 
     through Selected Acquisition Reports submitted pursuant to 
     section 2432 of this title);''.
       On page 47, line 16, add at the end the following: ``The 
     report shall include an assessment of--
       ``(A) the extent to which each of the military departments 
     have complied with policies, procedures, and guidance issued 
     by the Director with regard to the preparation of cost 
     estimates; and
       ``(B) the overall quality of cost estimates prepared by 
     each of the military departments.
       On page 48, line 2, add at the end the following: ``Each 
     report submitted to Congress under this subsection shall be 
     posted on an Internet website of the Department of Defense 
     that is available to the public.''.


                           amendment no. 1048

   (Purpose: To require consultation between the Director of Defense 
  Research and Engineering and the Director of Developmental Test and 
    Evaluation in assessments of technological maturity of critical 
          technologies of major defense acquisition programs)

       On page 42, line 12, insert ``, in consultation with the 
     Director of Developmental Test and Evaluation,'' after 
     ``shall''.

  Mr. LEVIN. Mr. President, I move to reconsider the vote regarding the 
amendments agreed to en bloc.
  Mr. INHOFE. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. McCAIN. Mr. President, it is my understanding, and I believe also 
the chairman's understanding, that we may have one or two other 
amendments pending.
  Mr. LEVIN. I thank the Senator for making that point. We want to see 
additional amendments if they are out there. We will do our best to 
clear them but, if not, debate them. We appreciate the cooperation of 
everybody.
  I yield the floor.


                           Amendment No. 1044

  The PRESIDING OFFICER. The Senator from Oklahoma is recognized.
  Mr. INHOFE. Mr. President, my amendment was one of the eight

[[Page S5221]]

amendments agreed to. I will be brief. I wish to get on record as to 
what it is I am trying to do.
  First of all, though, I think my name may be on there as a cosponsor; 
if not, I ask unanimous consent that I be added at this time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. INHOFE. Mr. President, section 2094 of the bill requires the 
Secretary to submit written certification if a program is not 
terminated that states the acquisition program is essential to the 
national security, that no alternatives meet the joint military 
requirement, the new estimates are reasonable, and the management 
structure is adequate to manage and control the program acquisition 
cost. I concur with the certification process, but no similar 
requirement is there for the termination of an acquisition program. 
That is an area in which oversight is required and information critical 
as we continue to improve the acquisition process, which I believe this 
legislation will do.
  My amendment requires the Secretary of Defense to submit a written 
report explaining the reasons for terminating the program, alternatives 
considered to address any problems in the program, and the course of 
action the Department of Defense plans to pursue to meet continuing 
joint military requirements intended to be met by the program being 
canceled. This report will provide Congress with historical 
documentation of the terminated or failed programs and why they are 
terminated.
  Essentially, the language of the amendment is simply the requirement 
that if a program is terminated, submit to Congress a written report 
setting forth three things: One, an explanation of the reason for 
terminating the program; two, the alternatives considered to address 
any problems in the program; three, the course the Department plans to 
pursue to meet any continuing joint military requirements otherwise 
intended to be met by the program.
  In other words, it makes the same requirement on terminated programs 
as others. This has already been adopted en bloc, and I have no motion 
to make.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant bill clerk proceeded to call the roll.
  Mrs. McCASKILL. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                  Amendments Nos. 1049, 1050, and 1051

  Mrs. McCASKILL. Mr. President, I rise to thank Chairman Levin and 
Ranking Member McCain on a good bill to address a serious and expensive 
problem in our military. We have costs that have ballooned. As Senator 
Levin explained earlier today, in 2008 alone the portfolio of DOD's 97 
major defense acquisition programs was nearly $300 billion over cost 
and the average delay in terms of delivering these capabilities to the 
warfighter was 22 months. That is unacceptable to our warfighters and 
unacceptable to taxpayers.
  There are obviously many examples of these systems that have been 
underestimated both on time of delivery and costs, but a good one is 
the Joint Strike Fighter. Right now, the JSF continues to rely on 
immature technologies and unrealistic cost schedules. We have a 
situation where DOD might actually procure these aircraft, these F-35s, 
costing $57 billion, before we have even completed the developmental 
flight testing. That is just one, but it is a very good example of a 
program that is underperforming for the warfighter and for the 
taxpayer.
  There are three amendments that have been added to this bill at my 
request, and I thank the Armed Services staff and particularly Senator 
Levin and Senator McCain for accepting these three amendments. I would 
like to briefly explain the three amendments we have added.
  The first is one that will provide some more teeth in a very critical 
area that is of huge importance in this process; that is, tightening up 
the process and procedures at JROC.
  JROC is the military's Joint Requirements Oversight Council. Now, 
that sounds pretty good. JROC sounds like a place where you are going 
to get oversight. But unfortunately, invariably, JROC has become a 
place where one branch of the military gets what it wants, and in 
return the other branch of the military gets what it wants, and in 
return the other branch of the military gets what it wants. It has been 
kind of a murky process. Based on hearings we have had and testimony 
and questions I have asked, it is clear to me that JROC has not been 
providing a lot of oversight--maybe a little too much back-scratching 
and not enough oversight. So two of these amendments are to deal with 
the JROC situation and hopefully improve it.
  One is going to bring more input from combatant commands to the JROC 
process. The warfighter's perspective is very important, as this 
council makes decisions about requirements on systems the U.S. taxpayer 
is going to purchase. It is very important that the warfighters have 
input because they are the end user. Maybe what they are saying in that 
room is what is needed or it turns out that maybe it is not what is 
needed. We have had examples of where we have failed our warfighters in 
not anticipating what the needs actually are on the ground. The Iraq 
war is full of examples where we underestimated what we needed in some 
regards and overestimated what we needed in others. The warfighter 
being in the process is very important.
  The other amendment that deals with the JROC--the Joint Requirements 
Oversight Council--is bringing another voice to this process. The Under 
Secretary of Defense for Acquisitions, Technology and Logistics will 
now be required to concur on the JROC requirements with an eye toward 
cost, utility, and policy considerations. So we have now added a 
referee of sorts--another voice. So it isn't just going to be about the 
Air Force or the Navy or the Army keeping each other happy but, rather, 
someone in a responsible position to look and concur that what they are 
doing is in the best interest of cost, utility, and overall policy 
considerations.
  That critical layer of the Under Secretary of Defense for 
Acquisitions, Technology and Logistics will also bring into the process 
the Secretary of Defense, if necessary, because if there is not an 
agreement, then the Secretary of Defense will have to come in and 
provide that ultimate decisionmaking with an eye toward cost, utility, 
and policy. This will allow the kind of leadership from the top to make 
sure these decisions are in the best interests of all of the military 
as opposed to everybody getting what they want.
  The final amendment that has been accepted that I believe will help 
is a little bit of looking over the shoulder on cost waivers. We have 
put into this bill a number of situations where certain safeguards can 
be waived if they are going to be too expensive. The best example is 
the prototype. There is going to be no need for them to do a 
competitive prototype if they decide they need to waive that 
requirement based on the cost of producing that prototype. I don't 
disagree that there may be some circumstances where costs are going to 
be too high to do a prototype, but what I want to make sure is that we 
don't abuse the cost waiver. In order to avoid abusing the cost waiver, 
we need an auditor looking over their shoulders. So this amendment 
mandates the reporting of cost waivers to GAO--the Government 
Accountability Office, the overall auditor in the Federal Government--
and it requires the GAO to provide a written review to the Senate Armed 
Services Committee and the House Armed Services Committee within 60 
days of the receipt of that waiver. This will allow the GAO to look 
over the shoulder and make sure the cost waiver is one based on 
reliable, objective, and reasonable information. I don't think it is 
going to be necessary for GAO to do a lot of these analyses if the 
military knows that it can. Sometimes, just knowing somebody is looking 
over your shoulder brings about better behavior. That is the goal of 
this amendment, to make sure we don't abuse cost waivers because this 
bill is not going to do a lot of good if the military has the 
opportunity to drive in, around, and through it without appropriate 
oversight.
  So I believe these amendments improve the bill. They are going to be 
helpful as we try to get a handle on the acquisition process.

[[Page S5222]]

  I will continue to work with the chairman and the ranking member in 
any way I can, particularly on the Subcommittee on Contracting 
Oversight, which I chair, which is now part of the Homeland Security 
and Governmental Affairs Committee. We on that subcommittee are going 
to continue to look at contracting in DOD, particularly keeping an eye 
not just on the weapons acquisition but the acquisition of services at 
DOD. That has also has been a huge growth industry as we have entered 
into contracting for support services such as never before in the 
American military, with, frankly, boxes and boxes of examples of waste, 
abuse, and fraud.
  So I am pleased this bill is moving as quickly as it has, and I am 
particularly pleased there has been such a bipartisan effort in this 
body. It is refreshing when we can all come together and do the right 
thing, as we are doing on this bill.
  Mr. President, I yield the floor.
  Mr. UDALL of Colorado. Mr. President, I am pleased to rise in support 
of an amendment to this important bill, offered by my colleague Senator 
McCaskill. I am proud to be a cosponsor of this amendment, which adds 
to good language in the bill requiring competitive prototyping. At its 
heart, this amendment is about our government wisely using taxpayer 
dollars.
  Last year, the U.S. Department of Defense announced a new policy that 
DOD development programs in their early stages must involve at least 
two prototypes--to be developed by competing industry teams--before DOD 
can move forward into the system design and development phase, the 
longest and costliest part of the process.
  The idea behind this policy makes sense: Technologies should be 
proven before contracts are awarded. Paper proposals alone do not 
always provide sufficient information on technical risk and cost 
estimates. But an investment in prototyping up-front can result in 
greater knowledge up-front, which in turn can lead to better cost and 
schedule assessments.
  It seems to me that DOD had the right idea to resurrect competitive 
prototyping. The sponsors of this bill--Senators Levin and McCain--
agreed. The bill we are considering today would codify DOD's policy.
  The bill would also authorize a waiver for competitive prototyping in 
the event of excessive cost. This was a change we made in the Senate 
Armed Services Committee, on which I sit. This change reflects DOD's 
concerns that it can sometimes be cost prohibitive to produce two or 
more prototypes of a system.
  One of the goals of competitive prototyping is to try to reduce 
costs, not increase them. So I believe DOD should have authority to 
waive this requirement when producing two or more prototypes of a 
system would be cost prohibitive. However, we should ensure that this 
waiver authority is not abused, or casually used as a way to avoid 
prototyping.
  So I support this amendment offered by my colleague today, which will 
add a layer of fiscal oversight to the sole-source nature of 
prototyping that can result from these waivers. It would require DOD to 
report cost waivers both to the Government Accountability Office and to 
congressional defense committees and require GAO to provide a written 
review to the congressional defense committees. This amendment is about 
good government, and I would hope that my colleagues in both parties 
would support it.
  I want to close by addressing the larger issue we are considering 
today--acquisition reform. As a member of the Armed Services Committee 
and as a taxpayer, this issue concerns me greatly. There seems to be 
universal agreement that reform is necessary. The GAO reported this 
year that DOD's major defense acquisition programs are nearly $300 
billion over budget. At a time of economic crisis and uncertainty, we 
need to work much harder to get these costs under control.
  But DOD's acquisition system is complex and there is no shortage of 
ideas on how to fix it. I am a cosponsor of this bill because I believe 
it takes important steps in the right direction. It does not try to fix 
the whole system, but instead focuses mainly on the early phases of the 
acquisition process, which can often start with ``inadequate 
foundations.'' As Chairman Levin stated in our committee, the ``bill is 
designed to help put major defense acquisition programs on a sound 
footing from the outset.'' I believe this bill will do that. I commend 
the authors of this bill for their important work and for building 
bipartisan support for this bill.
  I urge support of this bill and of the McCaskill amendment.
  The PRESIDING OFFICER. The Senator from Michigan is recognized.
  Mr. LEVIN. Mr. President, let me thank Senator McCaskill for her 
great work on the amendments she has just described. These are 
significant amendments, important amendments. They reflect the kind of 
dogged determination the good Senator from Missouri shows every day.
  These amendments are so important to the procurement process.
  I thank Senator McCaskill for her three amendments, which have 
strengthened the bill by, No. 1, reinforcing requirements to make 
trade-offs between cost, schedule, and performance, by directing the 
Under Secretary of Defense for Acquisition, Technology and Logistics to 
review requirements and ensure that such trade-offs have been made; No. 
2, enhancing the role of combatant commanders in developing 
requirements by spelling out issues on which their input should be 
solicited and considered; and No. 3, reinforcing competitive 
prototyping requirements in the bill by requiring a GAO review and 
assessment of any waiver on the requirement on the basis of excessive 
cost.
  These amendments improve the bill and reflect Senator McCaskill's 
consistent dedication to acquisition reform in the best interests of 
the taxpayers.
  I commend the Senator from Missouri.
  The PRESIDING OFFICER. The Senator from Arizona is recognized.
  Mr. McCAIN. Mr. President, I also would express my appreciation to 
the Senator from Missouri for her hard work, not only on this amendment 
but on the committee. I thank her and I think it has improved the 
legislation.
  In consultation, I think the chairman is going to talk about what we 
intend to do. I understand there are a couple of amendments that may 
require recorded votes, but we really need to have all amendments in so 
we can wrap up this legislation either tonight or tomorrow, depending 
on the wishes of the respective leaders.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Michigan is recognized.
  Mr. LEVIN. Mr. President, I thank the Senator from Arizona. What we 
are trying to do is see if we can't limit amendments. We think we know 
the amendments that are still out there, but we need people who want to 
pursue amendments to let us know that and give us an opportunity to 
look at them, to discuss the amendments with folks.
  I have not had an opportunity to talk with the majority leader about 
whether there will be an opportunity to have votes tonight if we can't 
work out amendments, but I better not say anything until I have that 
opportunity to check it out with the majority leader. I know Senator 
Chambliss is here to be recognized.
  I yield the floor.


                     Amendments Nos. 1053 and 1054

  Mr. CHAMBLISS. Mr. President, I rise to call up two amendments that 
have been filed at the desk, No. 1053 and No. 1054. I want to start by 
recognizing the great work Senators Levin and McCain have done on this 
issue. I have been extremely concerned about the acquisition process at 
the Department of Defense for years--during my House years as well as 
my Senate years. There have been no two greater champions on the issue 
than Senators Levin and McCain.
  They put together a piece of legislation that I think really does 
move us down the road in the right direction. We are dealing with less 
money in the defense budget than we have ever had. Yet the needs are 
greater. So I commend them for the great work they have done.
  One of the amendments I am going to talk about has already been 
accepted. I am very appreciative of their support of that amendment.
  Both of these amendments relate to the organizational conflict of 
interest--OCI--area of the bill.
  The first amendment, No. 1053, deals with the ways in which 
contractors

[[Page S5223]]

that have affiliates that provide systems engineering and technical 
assistance, or ``SETA'' services, must organize their SETA affiliates 
in order to mitigate conflict of interest.
  In relation to large contractors having affiliates that perform SETA 
functions, this amendment would allow for a closer modeling of the 
arrangements that large U.S. companies that are foreign-owned or 
controlled currently have for their defense-related operations in order 
to protect classified information.
  One aspect of these arrangements relates to how the corporate board 
for the U.S. company, or SETA affiliate in this case, is organized.
  One model is ``proxy board'' which cannot communicate in any way with 
the parent company and prohibits any board member for the affiliate 
from serving on the board of or having other responsibilities within 
the parent company.
  The proxy board model requires all outside board members and removes 
all prerogatives of ownership for the parent company. It does not allow 
the parent company to exercise any management control or oversight over 
the separate entity and, as such, is a huge liability for the parent 
company. As such, it is not an attractive model in many cases.
  The other approach is a ``special security agreement'' which is what 
BAE, Rolls Royce, and other large defense contractors who have a 
reputation for responsibility and trustworthiness use for their U.S. 
affiliates. This approach requires some board members to be totally 
independent of the parent company but also permits some communication 
between the board of the affiliate and the parent company.
  This model allows for regulated discussions between the affiliate and 
the parent and protects sensitive--versus routine--information from 
being shared.
  This model has other aspects to it that provide for independence and 
security, and it makes sense and is less onerous for the parent 
company.
  My amendment specifies that the arrangements between large 
contractors and their SETA affiliates should be similar to the 
``special security agreement'' I have discussed above.
  I am pleased that the managers have agreed to accept the amendment. I 
thank them for that.
  The second amendment which I have filed, No. 1054, relates to prime 
contractor ``make-buy'' decisions. These decisions relate to which 
aspects of a contract the prime contractor chooses to either make 
themselves or contract out to another company.
  The current bill prescribes what I believe to be onerous procedures 
for regulating the prime contractors' decisions in this regard and 
provides for ``government oversight of the process by which prime 
contractors consider such sources'' and authorizes ``program managers 
to disapprove the determination by a prime contractor to conduct 
development or construction in-house rather than through a 
subcontract.''

  In my opinion, this is an example of the Government interfering in a 
private company's legitimate business decisions and adds little value 
to the process.
  Current acquisition regulations already provide for oversight of 
``make-buy'' decisions by the Government. The ``Acquisition Reform 
Working Group'' composed of industry associations has strong language 
in their recent report on this bill opposing further Government 
intervention in ``make-buy'' decisions.
  Prime contractors are already incentivized through the market to make 
wise choices in this area and are held accountable to the Government 
for their choices, both through the terms of the contract in question 
and through future competitions for which past performance is always a 
consideration.
  My amendment strikes much of the provision in the bill and is 
intended to account for the fact that there are already procedures in 
place to address this issue. My amendment also attempts to prohibit 
excessive Government involvement in private sector business decisions.
  I would like to quote from the Acquisition Reform Working Group's, 
position paper they issued on this bill in relation to this issue.

       The acquisition regulations already grant the government 
     oversight of contractors' make/buy programs . . . The 
     government has an appropriate oversight role, but that role 
     must be managed to assure that the government is able to hold 
     a contractor accountable for results. If the government is to 
     determine which subcontractors will be part of a major 
     program, the government will necessarily assume 
     responsibility for that choice which will result in a 
     corresponding reduction in the prime contractor 's 
     responsibility for the program.
       Make-buy decisions are critical to program success. The 
     prime contractor must consider the selection of a major 
     subcontractor much as the government considers the selection 
     of the prime contractor in the source selection process. The 
     selection of the major subcontractors is made early in the 
     proposal process . . . To have the government substitute an 
     agency decision concerning these selections after award would 
     likely put the prime contractor's performance against the 
     contract awarded base-line at risk. Any additional emphasis 
     on the make-buy process should take into account the program 
     risk created by Government direction for contractor source 
     selection decisions.
       There is a fine balance that must be maintained to hold 
     contractors accountable for performance and results while 
     affording the government an appropriate oversight role. It is 
     unreasonable to expect a contractor to be held accountable 
     for results if the government does not both provide the 
     responsibility and the right incentives for that performance. 
     Better and earlier planning and program management by the 
     Government will mitigate a contractor's performance risks 
     more effectively than taking away a contractor's intellectual 
     property rights, innovation incentives, and accountability. 
     Taking away such rights will also render the Defense market 
     less attractive for new companies, especially commercial 
     companies, with high risk and little chance of reward.

  That is a rather extensive quote from that report by the Acquisition 
Reform Working Group, but I thought it was important to rationalize the 
way of thinking related to how we look at this issue. Basically, what 
we are proposing is, not to change the way the situation works today 
with respect to make-buy contracts.
  So if you have a major weapons system contractor that is awarded a 
contract, and under that contract, let's say for an automobile that 
obviously requires a steering wheel, then the contractor ought to have 
the ability to decide whether to make that steering wheel themselves or 
whether to subcontract that steering wheel out to another contractor. 
If the contractor has a right to make those decisions then the numbers 
that were contained in their bid are going to reflect that and 
accurately reflect the ultimate price the Government pays. But if the 
Government has the right, as the bill says, to step in after the award 
and tell the prime contractor: You are not going to subcontract out, we 
are going to mandate that you make that steering wheel, then I think it 
does take away some of the flexibility and the ability on the part of 
the prime contractor to be able to adhere to the numbers and pricing 
that their bid contains.
  This is a situation where, if we think contractors in the defense 
community are taking advantage of the system, the language in the bill 
is the direction in which we ought to go. But there are safeguards in 
every contract that the Department of Defense awards. I think what we 
need to do is focus more on making sure contractors are giving us the 
best possible buy we can get and the best quality of product we can 
get, and not hamstring those contractors who are making these bids. 
This will allow us to take the most advantage of taxpayer dollars that 
we have to use in equipping our men and women who wear the uniform of 
the United States.
  I understand the committee may have issues with this amendment, but I 
think it is a good amendment. I urge its adoption.
  I want to close by saying again that Senator McCain and I have talked 
about this issue of acquisition reform a number of times during my 
years in the Senate. There is no stronger advocate for doing what is 
right related to proper expenditure of taxpayer money than Senator 
McCain. I applaud him and Senator Levin for taking this on, getting in 
the weeds on it, because the contracts for which the Pentagon solicits 
bids and that they award on a daily basis are extremely complex, they 
are very large in the amount of money they spend, and this type of 
reform is not easy to put together.
  But I think Senators Levin and McCain have done an excellent job of 
coming up with what I think is a good product. I think with some of the 
amendments that have come forward

[[Page S5224]]

today it is going to be an even better product.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Michigan.
  Mr. LEVIN. Mr. President, first, let me commend the Senator from 
Georgia for the amendment which we have adopted, amendment No. 1053, 
that makes a very useful clarification of the standard for the separate 
business unit definition on this original conflict-of-interest 
provision we have.
  I wish to commend my friend from Georgia for doing that, for catching 
that, and for making that suggested change which we have now adopted in 
amendment No. 1053.
  We would oppose amendment No. 1054, if it were offered, for the 
following reasons: There has been a report from the Defense Science 
Board Task Force that, because of consolidation in the defense 
industry, there has been a substantial reduction in innovation and 
competition.
  In order to stimulate that, to make sure the avenues are open for 
small business, we have a provision in this bill which basically adopts 
the approach of the Defense Science Board Task Force and is consistent 
with the concerns they raise about the lack of competition resulting 
from consolidation.
  But, equally important, we hear from small business owners 
consistently that they have been excluded by prime contractors from 
competing for subcontract work. When they do that, they, of course, are 
reserving the business for themselves, for the prime contractors 
themselves.
  As the Senator from Georgia mentions, there is now some oversight. 
But the problem is, there is no ability to veto, in effect, the 
decision to keep the work in-house. We would not take over the 
competition or the contracting bidding process. But what we do provide 
for is the veto of a decision to keep work in-house, where we think it 
is anticompetitive or unfair.
  It is kind of an in-between position. The Defense Science Board 
actually suggested we go further than we have. What we do in this bill 
is say that if a decision is made that the contractor is keeping work 
in-house, which should be put up to competition to allow small 
businesses to bid on it, the discretion would be available for the 
Department to override that decision.
  We think that is kind of an appropriate thing to do to protect small 
businesses, to protect competition, and to make sure there is 
reasonable oversight of that decision of any prime contractor to keep 
the work for themselves instead of bidding it out, which, of course, 
would open it to smaller businesses and greater innovation.
  So we would oppose this amendment should it be called up. On the 
other hand, we want to, again, commend the Senator from Georgia because 
he has gotten into issues such as this. While we disagree with him on 
this one, we do want to note he has been very deeply involved in this 
bill. He has worked with us on this bill, and we greatly appreciate his 
support for our bill.
  I yield the floor and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BROWN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Bennet). Without objection, it is so 
ordered.


                           Health Care Reform

  Mr. BROWN. Mr. President, as has always been the case when our Nation 
attempts to improve its health care system, some people and some groups 
try to scare Americans into believing it would be better to cling to 
what we have than to strive for something better--the same old story, 
the same old song.
  Those who are using anti-reform scare tactics are typically people 
who are doing just fine, thank you, under the current system and, 
frankly, could not care less about those who are not doing so well, 
along with industry groups that want to make sure they can keep 
squeezing as much profit out of the health care system as possible.
  It is that lust for profits--not a desire to honestly inform the 
public--that leads industry groups to demonize any reform proposals 
they themselves did not write.
  In this case, conservative pundits, who I would guess have excellent 
health care coverage for themselves--the people you see on TV, the 
writers you see in the newspapers, the commentators you hear on the 
radio--conservative pundits, who probably have excellent health 
coverage for themselves, are trying to convince Americans that the only 
alternative to the status quo is ``socialized medicine.'' And the 
health insurance industry is trying to convince Americans that if it 
has to coexist with a federally backed insurance plan; that is, as an 
option for people, the insurance industry will disappear.
  The private insurance industry did not disappear when Medicare was 
established. The private insurance industry did not disappear when 
Medicaid was established, even though many insurance companies said 
they would. Why would it disappear when a federally backed option is 
created for working-age adults?
  Improving our health care system is too important a topic to be co-
opted by inflammatory, unfounded rhetoric--rhetoric about ``socialized 
medicine,'' rhetoric about ``Medicare for all,'' rhetoric about 
``single-payer systems,'' rhetoric that at the end of the day is 
nothing more than a bunch of hot air coming from a bunch of hotheads.
  The truth is, Congress is contemplating health care reform that would 
increase consumer choice--increase consumer choice--by improving access 
to private and public insurance alike.
  We are not eliminating private plans. We are saying: OK, the private 
plans will be here. They will have rules. The public plan will be here 
as an option--only as an option. It will have the same rules. Let them 
compete. If the private plans are so good, they will do well. The 
public plan is there, frankly, to keep the private plans honest so the 
private plans do not eliminate people because of community rating, do 
not eliminate people because they might have a preexisting medical 
condition.
  As I said, the truth is, the Congress is contemplating health care 
reforms that would increase consumer choice. There are zero--count 
them, zero--health care proposals under consideration in this Senate 
that would eliminate the private insurance system. In fact, every 
single one of them embraces and strengthens the private health 
insurance system.
  If you have employer-sponsored coverage, the reforms under 
consideration are designed to help you keep it. So understand, if you 
have insurance today, you can keep what you have. Under the legislation 
we will look at, if you want to choose a new insurance plan, you should 
have the full complement of choices: several private plans and a public 
plan, if you want to choose it. It is simply an option. It makes sense. 
It is not socialized medicine. It is simply good government. It is good 
health care.
  What we have done in the past simply has not worked. It is time for a 
different approach. It is time for a public option for the American 
people.
  Mr. President, I yield the floor.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. LEVIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1055

  Mr. LEVIN. Mr. President, I would call up, on behalf of Senator 
Bingaman, amendment No. 1055. I understand this has been cleared now. 
It is a useful clarification of the relationship between the 
developmental testing requirements in the bill and the testing reforms 
that were enacted 6 years ago.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       The Senator from Michigan [Mr. Levin], for Mr. Bingaman, 
     proposes an amendment numbered 1055.

  Mr. LEVIN. Mr. President, I ask unanimous consent that the reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To clarify the submittal of certifications of the adequacy of 
  budgets by the Director of the Department of Defense Test Resource 
                           Management Center)

       At the end of title I, add the following:

[[Page S5225]]

     SEC. 106. CLARIFICATION OF SUBMITTAL OF CERTIFICATION OF 
                   ADEQUACY OF BUDGETS BY THE DIRECTOR OF THE 
                   DEPARTMENT OF DEFENSE TEST RESOURCE MANAGEMENT 
                   CENTER.

       Section 196(e)(2) of title 10, United States Code, is 
     amended--
       (1) by redesignating subparagraph (B) as subparagraph (C); 
     and
       (2) by inserting after subparagraph (A) the following new 
     subparagraph (B):
       ``(B) If the Director of the Center is not serving 
     concurrently as the Director of Developmental Test and 
     Evaluation under subsection (b)(2) of section 139c of this 
     title, the certification of the Director of the Center under 
     subparagraph (A) shall, notwithstanding subsection (c)(4) of 
     such section, be submitted directly and independently to the 
     Secretary of Defense.''.

  The PRESIDING OFFICER. Is there further debate on the amendment?
  If not, the question is on agreeing to the amendment.
  The amendment (No. 1055) was agreed to.
  Mr. McCAIN. Mr. President, I move to reconsider the vote.
  Mr. LEVIN. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. LEVIN. Mr. President, I ask unanimous consent that the following 
be the only first-degree amendments in order to S. 454, other than the 
committee-reported substitute amendment, that the listed first-degree 
amendments be subject to second-degree amendments which are relevant to 
the amendment to which offered; that with respect to any subsequent 
agreement which provides for a limitation of debate regarding an 
amendment on the list, then that time be equally divided and controlled 
in the usual form; that if there is a sequence of votes with respect to 
these amendments, then there be 2 minutes equally divided and 
controlled prior to a vote in relation thereto; that upon disposition 
of the listed amendments, the substitute amendment, as amended, be 
agreed to, the bill, as amended, be read a third time, and the Senate 
proceed to vote on passage of the bill.
  The amendments I am including in this unanimous consent proposal are 
as follows:
  The Snowe amendment No. 1056 regarding small business contracting; a 
Thune amendment regarding weapons systems; a Coburn amendment regarding 
financial management, which we think we may have worked out, by the 
way; the Chambliss amendment No. 1054 regarding ``make buy;'' the 
Bingaman amendment, which we have already adopted so I will not refer 
to that; and the Murray amendment No. 1052 regarding national security 
objectives.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  Mr. LEVIN. I thank the Chair, and I thank my friend from Arizona and 
the staffs who worked this out. I think these amendments then would be 
considered probably tomorrow morning, although I don't know that we 
have final word on that. We ought to probably doublecheck that with our 
leaders, and I would note the absence of a quorum while we do that.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. LEVIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________