[Congressional Record Volume 155, Number 115 (Tuesday, July 28, 2009)]
[House]
[Pages H8918-H8926]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               COAST GUARD ACQUISITION REFORM ACT OF 2009

  Mr. CUMMINGS. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 1665) to structure Coast Guard acquisition processes and 
policies, and for other purposes, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 1665

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Coast 
     Guard Acquisition Reform Act of 2009''.
       (b) Table of Contents.--

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

      TITLE I--RESTRICTIONS ON THE USE OF LEAD SYSTEMS INTEGRATORS

Sec. 101. Procurement structure.

                TITLE II--COAST GUARD ACQUISITION POLICY

Sec. 201. Operational requirements.
Sec. 202. Required contract terms.
Sec. 203. Life-cycle cost estimates.
Sec. 204. Test and evaluation.
Sec. 205. Capability standards.
Sec. 206. Acquisition program reports.
Sec. 207. Undefinitized contractual actions.
Sec. 208. Guidance on excessive pass-through charges.
Sec. 209. Acquisition of major capabilities: Alternatives analysis.
Sec. 210. Cost overruns and delays.
Sec. 211. Report on former Coast Guard officials employed by 
              contractors to the agency.
Sec. 212. Department of Defense consultation.

                    TITLE III--COAST GUARD PERSONNEL

Sec. 301. Chief Acquisition Officer.
Sec. 302. Improvements in Coast Guard acquisition management.
Sec. 303. Recognition of Coast Guard personnel for excellence in 
              acquisition.
Sec. 304. Enhanced status quo officer promotion system.
Sec. 305. Coast Guard acquisition workforce expedited hiring authority.

     SEC. 2. DEFINITIONS.

       In this Act, the following definitions apply:
       (1) Appropriate congressional committees.--The term 
     ``appropriate congressional committees'' means the Committee 
     on Transportation and Infrastructure of the House of 
     Representatives and the Committee on Commerce, Science, and 
     Transportation of the Senate.
       (2) Commandant.--The term ``Commandant'' means the 
     Commandant of the Coast Guard.
       (3) Level 1 acquisition.--The term ``Level 1 acquisition'' 
     means--
       (A) an acquisition by the Coast Guard--
       (i) the estimated life-cycle costs of which exceed 
     $1,000,000,000; or
       (ii) the estimated total acquisition costs of which exceed 
     $300,000,000; or
       (B) any acquisition that the Chief Acquisition Officer of 
     the Coast Guard determines to have a special interest--
       (i) due to--

       (I) the experimental or technically immature nature of the 
     asset;
       (II) the technological complexity of the asset;
       (III) the commitment of resources; or
       (IV) the nature of the capability or set of capabilities to 
     be achieved; or

       (ii) because such acquisition is a joint acquisition.
       (4) Level 2 acquisition.--The term ``Level 2 acquisition'' 
     means an acquisition by the Coast Guard--
       (A) the estimated life-cycle costs of which are equal to or 
     less than $1,000,000,000, but greater than $300,000,000; or
       (B) the estimated total acquisition costs of which are 
     equal to or less than $300,000,0000, but greater than 
     $100,000,000.
       (5) Life-cycle cost.--The term ``life-cycle cost'' means 
     all costs for development, procurement, construction, and 
     operations and support for a particular capability or asset, 
     without regard to funding source or management control.

      TITLE I--RESTRICTIONS ON THE USE OF LEAD SYSTEMS INTEGRATORS

     SEC. 101. PROCUREMENT STRUCTURE.

       (a) In General.--
       (1) Use of lead systems integrator.--Except as provided in 
     subsection (b), the Commandant may not use a private sector 
     entity as a lead systems integrator for an acquisition 
     contract awarded or delivery order or task order issued after 
     the end of the 180-day period beginning on the date of 
     enactment of this Act.
       (2) Full and open competition.--The Commandant and any lead 
     systems integrator engaged by the Coast Guard shall use full 
     and open competition for any acquisition contract awarded 
     after the date of enactment of this Act, unless otherwise 
     excepted in accordance with Federal acquisition laws and 
     regulations promulgated under those laws, including the 
     Federal Acquisition Regulation.
       (3) No effect on small business act.--Nothing in this 
     subsection shall be construed to supersede or otherwise 
     affect the authorities provided by and under the Small 
     Business Act (15 U.S.C. 631 et seq.).
       (b) Exceptions.--
       (1) National distress and response system modernization 
     program; national security cutters 2 and 3.--Notwithstanding 
     subsections (a) and (e), the Commandant may use a private 
     sector entity as a lead systems integrator for the Coast 
     Guard to complete the National Distress and Response System 
     Modernization Program (otherwise known as the ``Rescue 21'' 
     program) and National Security Cutters 2 and 3.
       (2) Completion of acquisition by lead systems integrator.--
     Notwithstanding subsection (a), the Commandant may use a 
     private sector entity as a lead systems integrator for the 
     Coast Guard--
       (A) to complete any delivery order or task order, including 
     the exercise of previously established options on a delivery 
     order or task order that was issued to a lead systems 
     integrator on or before the date that is 180 days after the 
     date of enactment of this Act without any change in the 
     quantity of capabilities or assets or the specific type of 
     capabilities or assets covered by the order;
       (B) for a contract awarded after the date that is 180 days 
     after the date of enactment of this Act for acquisition of, 
     or in support of, the HC-130J aircraft, the HH-65 aircraft, 
     or the C4ISR system, if the requirements of subsection (c) 
     are met with respect to such acquisitions;
       (C) for a contract awarded after the date that is 180 days 
     after the date of enactment of this Act for acquisition of, 
     or in support of, Maritime Patrol Aircraft, if the 
     requirements of subsection (c) are met with respect to such 
     an acquisition; and
       (D) for the acquisition of, or in support of, additional 
     National Security Cutters or Maritime Patrol Aircraft, if the 
     Commandant determines that--
       (i) the acquisition is in accordance with Federal 
     acquisition laws and regulations promulgated under those 
     laws, including the Federal Acquisition Regulation;
       (ii) the acquisition and the use of a private sector entity 
     as a lead systems integrator for the acquisition are in the 
     best interest of the Federal Government; and
       (iii) the requirements of subsection (c) are met with 
     respect to such acquisition.
       (3) Report on decision-making process.--If the Commandant 
     determines under subparagraph (B), (C), or (D) of subsection 
     (b)(2) that the Coast Guard will use a private sector lead 
     systems integrator for an acquisition, the Commandant shall 
     notify in writing the appropriate congressional committees of 
     the Commandant's determination and shall provide a detailed 
     rationale for the determination, at least 30 days before the 
     award of a contract or issuance of a delivery order or task 
     order, using a private sector lead systems integrator, 
     including a comparison of the cost of the acquisition through 
     the private sector lead systems integrator with the expected 
     cost if the acquisition were awarded directly to the 
     manufacturer or shipyard. For purposes of that comparison, 
     the cost of award directly to a manufacturer or shipyard 
     shall include the costs of Government contract management and 
     oversight.
       (c) Limitation on Lead Systems Integrators.--Neither an 
     entity performing lead systems integrator functions for a 
     Coast Guard acquisition nor a Tier 1 subcontractor for any 
     acquisition described in subparagraph (B), (C), or (D) of 
     subsection (b)(2) may have a financial interest in a 
     subcontractor below the Tier 1 subcontractor level unless--
       (1) the subcontractor was selected by the prime contractor 
     through full and open competition for such procurement;
       (2) the procurement was awarded by the lead systems 
     integrator or a subcontractor through full and open 
     competition;
       (3) the procurement was awarded by a subcontractor through 
     a process over which the lead systems integrator or a Tier 1 
     subcontractor exercised no control; or
       (4) the Commandant has determined that the procurement was 
     awarded in a manner consistent with Federal acquisition laws 
     and regulations promulgated under those laws, including the 
     Federal Acquisition Regulation.
       (d) Rule of Construction.--The limitation in subsection 
     (b)(1)(A) on the quantity and specific type of assets to 
     which subsection

[[Page H8919]]

     (b) applies shall not be construed to apply to the 
     modification of the number or type of any sub-systems or 
     other components of a vessel or aircraft described in 
     subparagraph (B), (C), or (D) of subsection (b)(2).
       (e) Termination Date for Exceptions.--Except as described 
     in subsection (b)(1), the Commandant may not use a private 
     sector entity as a lead systems integrator for acquisition 
     contracts awarded, or task orders or delivery orders issued, 
     after the earlier of--
       (1) September 30, 2011; or
       (2) the date on which the Commandant certifies in writing 
     to the appropriate congressional committees that the Coast 
     Guard has available and can retain sufficient acquisition 
     workforce personnel and expertise within the Coast Guard, 
     through an arrangement with other Federal agencies, or 
     through contracts or other arrangements with private sector 
     entities, to perform the functions and responsibilities of 
     the lead systems integrator in an efficient and cost-
     effective manner.

                TITLE II--COAST GUARD ACQUISITION POLICY

     SEC. 201. OPERATIONAL REQUIREMENTS.

       (a) In General.--No Level 1 or Level 2 acquisition program 
     may be initiated by the Coast Guard, and no production 
     contract may be awarded for such an acquisition, unless the 
     Commandant has approved an operational requirement for such 
     acquisition.
       (b) Operational Requirement for Acquisition Programs.--
       (1) In general.--The Commandant shall establish mature and 
     stable operational requirements for acquisition programs.
       (2) Elements.--Prior to establishing operational 
     requirements under paragraph (1), the Commandant shall--
       (A) prepare a preliminary statement of need, a concept of 
     operations, an analysis of alternatives or the equivalent, an 
     estimate of life-cycle costs, and requirements for 
     interoperability with other capabilities and assets within 
     and external to the Coast Guard; and
       (B) in preparing the concept of operations under 
     subparagraph (A), coordinate with acquisition and support 
     professionals, requirements officials, operational users and 
     maintainers, and resource officials who can ensure the 
     appropriate consideration of performance, cost, schedule and 
     risk trade-offs.
       (c) Consideration of Trade-Offs.--In establishing 
     operational requirements under subsection (a), the Commandant 
     shall develop and implement mechanisms to ensure that trade-
     offs among performance, cost, schedule, and risk are 
     considered in the establishment of operational requirements 
     for development and production of a Level 1 or Level 2 
     acquisition.
       (d) Elements.--The mechanisms required under this section 
     shall ensure at a minimum that Coast Guard officials 
     responsible for acquisition management, budget, and cost 
     estimating functions have the authority to develop cost 
     estimates and raise cost and schedule matters at any point in 
     the process of establishing operational requirements for a 
     Level 1 or Level 2 acquisition.

     SEC. 202. REQUIRED CONTRACT TERMS.

       (a) In General.--The Commandant shall ensure that a 
     contract awarded or a delivery order or task order issued for 
     an acquisition of a capability or an asset with an expected 
     service life of 10 years and with a total acquisition cost 
     that is equal to or exceeds $10,000,000 awarded or issued by 
     the Coast Guard after the date of enactment of this Act--
       (1) provides that all certifications for an end-state 
     capability or asset under such contract, delivery order, or 
     task order, respectively, will be conducted by the Commandant 
     or an independent third party, and that self-certification by 
     a contractor or subcontractor is not allowed;
       (2) requires that the Commandant shall maintain the 
     authority to establish, approve, and maintain technical 
     requirements;
       (3) requires that any measurement of contractor and 
     subcontractor performance be based on the status of all work 
     performed, including the extent to which the work performed 
     met all performance, cost, and schedule requirements;
       (4) specifies that, for the acquisition or upgrade of air, 
     surface, or shore capabilities and assets for which 
     compliance with TEMPEST certification is a requirement, the 
     standard for determining such compliance will be the air, 
     surface, or shore standard then used by the Department of the 
     Navy for that type of capability or asset; and
       (5) for any contract awarded to acquire an Offshore Patrol 
     Cutter, includes provisions specifying the service life, 
     fatigue life, and days underway in general Atlantic and North 
     Pacific Sea conditions, maximum range, and maximum speed the 
     cutter will be built to achieve.
       (b) Prohibited Contract Provisions.--The Commandant shall 
     ensure that any contract awarded or delivery order or task 
     order issued by the Coast Guard after the date of enactment 
     of this Act does not include any provision allowing for 
     equitable adjustment that differs from the Federal 
     Acquisition Regulation.
       (c) Extension of Program.--Any contract, contract 
     modification, or award term extending a contract with a lead 
     systems integrator--
       (1) shall not include any minimum requirements for the 
     purchase of a given or determinable number of specific 
     capabilities or assets; and
       (2) shall be reviewed by an independent third party with 
     expertise in acquisition management, and the results of that 
     review shall be submitted to the appropriate congressional 
     committees at least 60 days prior to the award of the 
     contract, contract modification, or award term.

     SEC. 203. LIFE-CYCLE COST ESTIMATES.

       (a) In General.--The Commandant shall implement mechanisms 
     to ensure the development and regular updating of life-cycle 
     cost estimates for each acquisition with a total acquisition 
     cost that equals or exceeds $10,000,000 and an expected 
     service life of 10 years, and to ensure that these estimates 
     are considered in decisions to develop or produce new or 
     enhanced capabilities and assets.
       (b) Types of Estimates.--In addition to life-cycle cost 
     estimates that may be developed by acquisition program 
     offices, the Commandant shall require that an independent 
     life-cycle cost estimate be developed for each Level 1 or 
     Level 2 acquisition program or project.
       (c) Required Updates.--For each Level 1 or Level 2 
     acquisition program or project the Commandant shall require 
     that life-cycle cost estimates shall be updated before each 
     milestone decision is concluded and the program or project 
     enters a new acquisition phase.

     SEC. 204. TEST AND EVALUATION.

       (a) Test and Evaluation Master Plan.--
       (1) In general.--For any Level 1 or Level 2 acquisition 
     program or project the Coast Guard Chief Acquisition Officer 
     must approve a Test and Evaluation Master Plan specific to 
     the acquisition program or project for the capability, asset, 
     or sub-systems of the capability or asset and intended to 
     minimize technical, cost, and schedule risk as early as 
     practicable in the development of the program or project.
       (2) Test and evaluation strategy.--The TEMP shall--
       (A) set forth an integrated test and evaluation strategy 
     that will verify that capability-level or asset-level and 
     sub-system-level design and development, including 
     performance and supportability, have been sufficiently proven 
     before the capability, asset, or sub-system of the capability 
     or asset is approved for production; and
       (B) require that adequate developmental tests and 
     evaluations and operational tests and evaluations established 
     under subparagraph (A) are performed to inform production 
     decisions.
       (3) Other components of temp.--At a minimum, the TEMP shall 
     identify--
       (A) the key performance parameters to be resolved through 
     the integrated test and evaluation strategy;
       (B) critical operational issues to be assessed in addition 
     to the key performance parameters;
       (C) specific development test and evaluation phases and the 
     scope of each phase;
       (D) modeling and simulation activities to be performed, if 
     any, and the scope of such activities;
       (E) early operational assessments to be performed, if any, 
     and the scope of such assessments;
       (F) operational test and evaluation phases;
       (G) an estimate of the resources, including funds, that 
     will be required for all test, evaluation, assessment, 
     modeling, and simulation activities; and
       (H) the Government entity or independent entity that will 
     perform the test, evaluation, assessment, modeling, and 
     simulation activities.
       (4) Update.--The Coast Guard Chief Acquisition Officer 
     shall approve an updated TEMP whenever there is a revision to 
     program or project test and evaluation strategy, scope, or 
     phasing.
       (5) Limitation.--The Coast Guard may not--
       (A) proceed past that phase of the acquisition process that 
     entails approving the supporting acquisition of a capability 
     or asset before the TEMP is approved by the Coast Guard Chief 
     Acquisition Officer; or
       (B) award any production contract for a capability, asset, 
     or sub-system for which a TEMP is required under this 
     subsection before the TEMP is approved by the Coast Guard 
     Chief Acquisition Officer.
       (b) Tests and Evaluations.--
       (1) In general.--The Commandant shall ensure that the Coast 
     Guard conducts developmental tests and evaluations and 
     operational tests and evaluations of a capability or asset 
     and the sub-systems of the capability or asset for which a 
     TEMP has been prepared under subsection (a).
       (2) Use of third parties.--The Commandant shall ensure that 
     the Coast Guard uses third parties with expertise in testing 
     and evaluating the capabilities or assets and the sub-systems 
     of the capabilities or assets being acquired to conduct 
     developmental tests and evaluations and operational tests and 
     evaluations whenever the Coast Guard lacks the capability to 
     conduct the tests and evaluations required by a TEMP.
       (3) Communication of safety concerns.--The Commandant shall 
     require that safety concerns identified during developmental 
     or operational tests and evaluations or through independent 
     or Government-conducted design assessments of capabilities or 
     assets and sub-systems of capabilities or assets to be 
     acquired by the Coast Guard shall be communicated as soon as 
     practicable, but not later than 30 days after the completion 
     of the test or assessment event or activity that identified 
     the safety concern, to the program manager for the capability 
     or asset and the sub-systems concerned and to the Coast Guard 
     Chief Acquisition Officer.

[[Page H8920]]

       (4) Reporting of safety concerns.--Any safety concerns that 
     have been reported to the Chief Acquisition Officer for an 
     acquisition program or project shall be reported by the 
     Commandant to the appropriate congressional committees at 
     least 90 days before the award of any contract or issuance of 
     any delivery order or task order for low, initial, or full-
     rate production of the capability or asset concerned if they 
     will remain uncorrected or unmitigated at the time such a 
     contract is awarded or delivery order or task order is 
     issued. The report shall include a justification for the 
     approval of that level of production of the capability or 
     asset before the safety concern is corrected or mitigated. 
     The report shall also include an explanation of the actions 
     that will be taken to correct or mitigate the safety concern, 
     the date by which those actions will be taken, and the 
     adequacy of current funding to correct or mitigate the safety 
     concern.
       (5) Asset already in low, initial, or full-rate 
     production.--If operational test and evaluation on a 
     capability or asset already in low, initial, or full-rate 
     production identifies a safety concern with the capability or 
     asset or any sub-systems of the capability or asset not 
     previously identified during developmental or operational 
     test and evaluation, the Commandant shall--
       (A) notify the program manager and the Chief Acquisition 
     Officer of the safety concern as soon as practicable, but not 
     later than 30 days after the completion of the test and 
     evaluation event or activity that identified the safety 
     concern; and
       (B) notify the appropriate congressional Committee of the 
     safety concern not later than 30 days after notification is 
     made to the program manager and Chief Acquisition Officer, 
     and include in such notification--
       (i) an explanation of the actions that will be taken to 
     correct or mitigate the safety concern in all capabilities or 
     assets and sub-systems of the capabilities or assets yet to 
     be produced, and the date by which those actions will be 
     taken;
       (ii) an explanation of the actions that will be taken to 
     correct or mitigate the safety concern in previously produced 
     capabilities or assets and sub-systems of the capabilities or 
     assets, and the date by which those actions will be taken; 
     and
       (iii) an assessment of the adequacy of current funding to 
     correct or mitigate the safety concern in capabilities or 
     assets and sub-systems of the capabilities or assets and in 
     previously produced capabilities or assets and sub-systems.
       (c) Definitions.--In this section:
       (1) Developmental test and evaluation.--The term 
     ``developmental test and evaluation'' means--
       (A) the testing of a capability or asset and the sub-
     systems of the capability or asset to determine whether they 
     meet all contractual performance requirements, including 
     technical performance requirements, supportability 
     requirements, and interoperability requirements and related 
     specifications; and
       (B) the evaluation of the results of such testing.
       (2) Operational test and evaluation.--The term 
     ``operational test and evaluation'' means--
       (A) the testing of a capability or asset and the sub-
     systems of the capability or asset, under conditions similar 
     to those in which the capability or asset and subsystems will 
     actually be deployed, for the purpose of determining the 
     effectiveness and suitability of the capability or asset and 
     sub-systems for use by typical Coast Guard users to conduct 
     those missions for which the capability or asset and sub-
     systems are intended to be used; and
       (B) the evaluation of the results of such testing.
       (3) Safety concern.--The term ``safety concern'' means any 
     hazard associated with a capability or asset or a sub-system 
     of a capability or asset that is likely to cause serious 
     bodily injury or death to a typical Coast Guard user in 
     testing, maintaining, repairing, or operating the capability, 
     asset, or sub-system or any hazard associated with the 
     capability, asset, or sub-system that is likely to cause 
     major damage to the capability, asset, or sub-system during 
     the course of its normal operation by a typical Coast Guard 
     user.
       (4) TEMP.--The term ``TEMP'' means a Test and Evaluation 
     Master Plan for which approval is required under this 
     section.

     SEC. 205. CAPABILITY STANDARDS.

       (a) Cutter Classification.--The Commandant shall cause each 
     cutter, other than a National Security Cutter, acquired by 
     the Coast Guard and delivered after the date of enactment of 
     this Act to be classed by the American Bureau of Shipping 
     before final acceptance.
       (b) Tempest Testing.--The Commandant shall--
       (1) cause all electronics on all aircraft, surface, and 
     shore capabilities and assets that require TEMPEST 
     certification and that are delivered after the date of 
     enactment of this Act to be tested in accordance with TEMPEST 
     standards and communication security (COMSEC) standards by an 
     independent third party that is authorized by the Federal 
     Government to perform such testing; and
       (2) certify that the capabilities and assets meet all 
     applicable TEMPEST requirements.
       (c) National Security Cutters.--
       (1) National security cutters 1 and 2.--Not later than 90 
     days before the Coast Guard awards any contract or issues any 
     delivery order or task order to strengthen the hull of either 
     of National Security Cutter 1 or 2 to resolve the structural 
     design and performance issues identified in the Department of 
     Homeland Security Inspector General's report OIG-07-23 dated 
     January 2007, the Commandant shall submit to the appropriate 
     congressional committees and the Committee on Homeland 
     Security of the House of Representatives all results of an 
     assessment of the proposed hull strengthening design 
     conducted by the Coast Guard, including--
       (A) a description in detail of the extent to which the hull 
     strengthening measures to be implemented on those cutters 
     will enable the cutters to meet contract and performance 
     requirements;
       (B) a cost benefit analysis of the proposed hull 
     strengthening measures for National Security Cutters 1 and 2; 
     and
       (C) a description of any operational restrictions that 
     would have to be applied to either National Security Cutters 
     1 or 2 if the proposed hull strengthening measures were not 
     implemented on either cutter.
       (2) Other vessels.--The Commandant shall cause the design 
     and construction of each National Security Cutter, other than 
     National Security Cutters 1, 2, and 3, to be assessed by an 
     independent third party with expertise in vessel design and 
     construction certification.
       (d) Aircraft Airworthiness.--The Commandant shall cause all 
     aircraft and aircraft engines acquired by the Coast Guard and 
     delivered after the date of enactment of this Act to be 
     assessed for airworthiness by an independent third party with 
     expertise in aircraft and aircraft engine certification, 
     before final acceptance.

     SEC. 206. ACQUISITION PROGRAM REPORTS.

       Any Coast Guard Level 1 or Level 2 acquisition program or 
     project may not begin to obtain any capability or asset or 
     proceed beyond that phase of its development that entails 
     approving the supporting acquisition until the Commandant 
     submits to the appropriate congressional committees the 
     following:
       (1) The key performance parameters, the key system 
     attributes, and the operational performance attributes of the 
     capability and asset to be acquired under the proposed 
     acquisition program or project will be built to achieve.
       (2) A detailed list of the systems or other capabilities 
     with which the capability or asset to be acquired is intended 
     to be interoperable, including an explanation of the 
     attributes of interoperability.
       (3) The anticipated acquisition program baseline and 
     acquisition unit cost for the capability or asset to be 
     produced and deployed under the program or project.
       (4) A detailed schedule for the acquisition process showing 
     when all capability and asset acquisitions are to be 
     completed and when all acquired capabilities and assets are 
     to be initially and fully deployed.

     SEC. 207. UNDEFINITIZED CONTRACTUAL ACTIONS.

       (a) In General.--The Coast Guard may not enter into an 
     undefinitized contractual action unless such action is 
     directly approved by the Head of Contracting Activity of the 
     Coast Guard.
       (b) Requests for Undefinitized Contractual Actions.--Any 
     request to the Head of Contracting Activity for approval of 
     an undefinitized contractual action covered under subsection 
     (a) must include a description of the anticipated effect on 
     requirements of the Coast Guard if a delay is incurred for 
     the purposes of determining contractual terms, 
     specifications, and price before performance is begun under 
     the contractual action.
       (c) Requirements for Undefinitized Contractual Actions.--
       (1) Deadline for agreement on terms, specifications, and 
     price.--A contracting officer of the Coast Guard may not 
     enter into an undefinitized contractual action unless the 
     contractual action provides for agreement upon contractual 
     terms, specification, and price by the earlier of--
       (A) the end of the 180-day period beginning on the date on 
     which the contractor submits a qualifying proposal to 
     definitize the contractual terms, specifications, and price; 
     or
       (B) the date on which the amount of funds obligated under 
     the contractual action is equal to more than 50 percent of 
     the negotiated overall ceiling price for the contractual 
     action.
       (2) Limitation on obligations.--
       (A) In general.--Except as provided in subparagraph (B), 
     the contracting officer for an undefinitized contractual 
     action may not obligate under such contractual action an 
     amount that exceeds 50 percent of the negotiated overall 
     ceiling price until the contractual terms, specifications, 
     and price are definitized for such contractual action.
       (B) Exception.--Notwithstanding subparagraph (A), if a 
     contractor submits a qualifying proposal to definitize an 
     undefinitized contractual action before an amount that 
     exceeds 50 percent of the negotiated overall ceiling price is 
     obligated on such action, the contracting officer for such 
     action may not obligate with respect to such contractual 
     action an amount that exceeds 75 percent of the negotiated 
     overall ceiling price until the contractual terms, 
     specifications, and price are definitized for such 
     contractual action.
       (3) Waiver.--The Commandant may waive the application of 
     this subsection with respect to a contract if the Commandant 
     determines that the waiver is necessary to support--

[[Page H8921]]

       (A) a contingency operation (as that term is defined in 
     section 101(a)(13) of title 10, United States Code);
       (B) an operation in response to an emergency that poses an 
     unacceptable threat to human health or safety or to the 
     marine environment; or
       (C) an operation in response to a natural disaster or major 
     disaster or emergency designated by the President under the 
     Robert T. Stafford Disaster Relief and Emergency Assistance 
     Act (42 U.S.C. 5121 et seq.).
       (4) Limitation on application.--This subsection does not 
     apply to an undefinitized contractual action for the purchase 
     of initial spares.
       (d) Inclusion of Nonurgent Requirements.--Requirements for 
     spare parts and support equipment that are not needed on an 
     urgent basis may not be included in an undefinitized 
     contractual action by the Coast Guard for spare parts and 
     support equipment that are needed on an urgent basis unless 
     the Commandant approves such inclusion as being--
       (1) good business practice; and
       (2) in the best interests of the United States.
       (e) Modification of Scope.--The scope of an undefinitized 
     contractual action under which performance has begun may not 
     be modified unless the Commandant approves such modification 
     as being--
       (1) good business practice; and
       (2) in the best interests of the United States.
       (f) Allowable Profit.--The Commandant shall ensure that the 
     profit allowed on an undefinitized contractual action for 
     which the final price is negotiated after a substantial 
     portion of the performance required is completed reflects--
       (1) the possible reduced cost risk of the contractor with 
     respect to costs incurred during performance of the contract 
     before the final price is negotiated; and
       (2) the reduced cost risk of the contractor with respect to 
     costs incurred during performance of the remaining portion of 
     the contract.
       (g) Definitions.--In this section:
       (1) Undefinitized contractual action.--
       (A) In general.--Except as provided in subparagraph (B), 
     the term ``undefinitized contractual action'' means a new 
     procurement action entered into by the Coast Guard for which 
     the contractual terms, specifications, or price are not 
     agreed upon before performance is begun under the action.
       (B) Exclusion.--Such term does not include contractual 
     actions with respect to the following:
       (i) Foreign military sales.
       (ii) Purchases in an amount not in excess of the amount of 
     the simplified acquisition threshold.
       (iii) Special access programs.
       (2) Qualifying proposal.--The term ``qualifying proposal'' 
     means a proposal that contains sufficient information to 
     enable complete and meaningful audits of the information 
     contained in the proposal as determined by the contracting 
     officer.

     SEC. 208. GUIDANCE ON EXCESSIVE PASS-THROUGH CHARGES.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, the Commandant shall issue guidance to 
     ensure that pass-through charges on contracts, subcontracts, 
     delivery orders, and task orders that are entered into with a 
     private entity acting as a lead systems integrator by or on 
     behalf of the Coast Guard are not excessive in relation to 
     the cost of work performed by the relevant contractor or 
     subcontractor. The guidance shall, at a minimum--
       (1) set forth clear standards for determining when no, or 
     negligible, value has been added to a contract by a 
     contractor or subcontractor;
       (2) set forth procedures for preventing the payment by the 
     Government of excessive pass-through charges; and
       (3) identify any exceptions determined by the Commandant to 
     be in the best interest of the Government.
       (b) Excessive Pass-Through Charge Defined.--In this section 
     the term ``excessive pass-through charge'', with respect to a 
     contractor or subcontractor that adds no, or negligible, 
     value to a contract or subcontract, means a charge to the 
     Government by the contractor or subcontractor that is for 
     overhead or profit on work performed by a lower-tier 
     contractor or subcontractor, other than reasonable charges 
     for the direct costs of managing lower-tier contractors and 
     subcontracts and overhead and profit based on such direct 
     costs.
       (c) Application of Guidance.--The guidance under this 
     subsection shall apply to contracts awarded to a private 
     entity acting as a lead systems integrator by or on behalf of 
     the Coast Guard on or after the date that is 360 days after 
     the date of enactment of this Act.

     SEC. 209. ACQUISITION OF MAJOR CAPABILITIES: ALTERNATIVES 
                   ANALYSIS.

       The Coast Guard may not acquire an experimental or 
     technically immature capability or asset or implement a Level 
     1 or Level 2 acquisition, unless it has conducted an 
     alternatives analysis for the capability or asset to be 
     acquired in the concept and technology development phase of 
     the acquisition process for the capability or asset. Such 
     analysis shall be conducted by a federally funded research 
     and development center, a qualified entity of the Department 
     of Defense, or a similar independent third party entity that 
     has appropriate acquisition expertise. Such alternatives 
     analysis shall include--
       (1) an assessment of the technical maturity of the 
     capability or asset and technical and other risks;
       (2) an examination of capability, interoperability, and 
     other advantages and disadvantages;
       (3) an evaluation of whether different combinations or 
     quantities of specific capabilities or assets could meet the 
     Coast Guard's overall performance needs;
       (4) a discussion of key assumptions and variables, and 
     sensitivity to change in such assumptions and variables;
       (5) when an alternative is an existing capability, asset, 
     or prototype, an evaluation of relevant safety and 
     performance records and costs;
       (6) a calculation of life-cycle costs, including--
       (A) an examination of development costs and the levels of 
     uncertainty associated with such estimated costs;
       (B) an examination of likely production and deployment 
     costs and the levels of uncertainty associated with such 
     estimated costs;
       (C) an examination of likely operating and support costs 
     and the levels of uncertainty associated with such estimated 
     costs;
       (D) if they are likely to be significant, an examination of 
     likely disposal costs and the levels of uncertainty 
     associated with such estimated costs; and
       (E) such additional measures the Commandant determines to 
     be necessary for appropriate evaluation of the capability or 
     asset; and
       (7) the business case for each viable alternative.

     SEC. 210. COST OVERRUNS AND DELAYS.

       (a) In General.--The Commandant shall submit a report to 
     the appropriate congressional committees as soon as possible, 
     but not later than 30 days, after the Chief Acquisition 
     Officer of the Coast Guard becomes aware of the breach of an 
     acquisition program baseline for any Level 1 or Level 2 
     acquisition program, by--
       (1) a likely cost overrun greater than 10 percent of the 
     acquisition program baseline for that individual capability 
     or asset or a class of capabilities or assets;
       (2) a likely delay of more than 180 days in the delivery 
     schedule for any individual capability or asset or class of 
     capabilities or assets; or
       (3) an anticipated failure for any individual capability or 
     asset or class of capabilities or assets to satisfy any key 
     performance threshold or parameter under the acquisition 
     program baseline.
       (b) Content.--The report submitted under subsection (a) 
     shall include--
       (1) a detailed description of the breach and an explanation 
     of its cause;
       (2) the projected impact to performance, cost, and 
     schedule;
       (3) an updated acquisition program baseline and the 
     complete history of changes to the original acquisition 
     program baseline;
       (4) the updated acquisition schedule and the complete 
     history of changes to the original schedule;
       (5) a full life-cycle cost analysis for the capability or 
     asset or class of capabilities or assets;
       (6) a remediation plan identifying corrective actions and 
     any resulting issues or risks; and
       (7) a description of how progress in the remediation plan 
     will be measured and monitored.
       (c) Substantial Variances in Costs or Schedule.--If a 
     likely cost overrun is greater than 20 percent or a likely 
     delay is greater than 12 months from the costs and schedule 
     described in the acquisition program baseline for any Level 1 
     or Level 2 acquisition program or project of the Coast Guard, 
     the Commandant shall include in the report a written 
     certification, with a supporting explanation, that--
       (1) the capability or asset or capability or asset class to 
     be acquired under the program or project is essential to the 
     accomplishment of Coast Guard missions;
       (2) there are no alternatives to such capability or asset 
     or capability or asset class which will provide equal or 
     greater capability in both a more cost-effective and timely 
     manner;
       (3) the new acquisition schedule and estimates for total 
     acquisition cost are reasonable; and
       (4) the management structure for the acquisition program is 
     adequate to manage and control performance, cost, and 
     schedule.

     SEC. 211. REPORT ON FORMER COAST GUARD OFFICIALS EMPLOYED BY 
                   CONTRACTORS TO THE AGENCY.

       (a) Report Required.--Not later than December 31, 2009, and 
     annually thereafter, the Comptroller General of the United 
     States shall submit a report to the appropriate congressional 
     committees on the employment during the preceding year by 
     Coast Guard contractors of individuals who were Coast Guard 
     officials in the previous 5-year period. The report shall 
     assess the extent to which former Coast Guard officials were 
     provided compensation by Coast Guard contractors in the 
     preceding calendar year.
       (b) Objectives of Report.--At a minimum, the report 
     required by this section shall assess the extent to which 
     former Coast Guard officials who receive compensation from 
     Coast Guard contractors have been assigned by those 
     contractors to work on contracts or programs between the 
     contractor and the Coast Guard, including contracts or

[[Page H8922]]

     programs for which the former official personally had 
     oversight responsibility or decision-making authority when 
     they served in or worked for the Coast Guard.
       (c) Confidentiality Requirement.--The report required by 
     this subsection shall not include the names of the former 
     Coast Guard officials who receive compensation from Coast 
     Guard contractors.
       (d) Access to Information.--A Coast Guard contractor shall 
     provide the Comptroller General access to information 
     requested by the Comptroller General for the purpose of 
     conducting the study required by this section.
       (e) Definitions.--In this section:
       (1) Coast guard contractor.--The term ``Coast Guard 
     contractor'' includes any person that received at least 
     $10,000,000 in contractor awards from the Coast Guard in the 
     calendar year covered by the annual report.
       (2) Coast guard official.--The term ``Coast Guard 
     official'' includes former officers of the Coast Guard who 
     were compensated at a rate of pay for grade O-7 or above 
     during the calendar year prior to the date on which they 
     separated from the Coast Guard, and former civilian employees 
     of the Coast Guard who served at any level of the Senior 
     Executive Service under subchapter VIII of chapter 53 of 
     title 5, United States Code, during the calendar year prior 
     to the date on which they separated from the Coast Guard.

     SEC. 212. DEPARTMENT OF DEFENSE CONSULTATION.

       (a) In General.--The Commandant shall make arrangements as 
     appropriate with the Secretary of Defense for support in 
     contracting and management of Coast Guard acquisition 
     programs. The Commandant shall also seek opportunities to 
     make use of Department of Defense contracts, and contracts of 
     other appropriate agencies, to obtain the best possible price 
     for capabilities and assets acquired for the Coast Guard.
       (b) Inter-Service Technical Assistance.--The Commandant may 
     enter into a memorandum of understanding or a memorandum of 
     agreement with the Secretary of the Navy to obtain the 
     assistance of the Office of the Assistant Secretary of the 
     Navy for Research, Development, and Acquisition, including 
     the Navy Systems Commands, with the oversight of Coast Guard 
     major acquisition programs. Such memorandum of understanding 
     or memorandum of agreement shall, at a minimum, provide for--
       (1) the exchange of technical assistance and support that 
     the Coast Guard Chief Acquisition Officer, Coast Guard Chief 
     Engineer, and the Coast Guard Chief Information Officer may 
     identify;
       (2) the use, as appropriate, of Navy technical expertise; 
     and
       (3) the temporary assignment or exchange of personnel 
     between the Coast Guard and the Office of the Assistant 
     Secretary of the Navy for Research, Development, and 
     Acquisition, including Naval Systems Commands, to facilitate 
     the development of organic capabilities in the Coast Guard.
       (c) Technical Requirement Approval Procedures.--The Coast 
     Guard Chief Acquisition Officer shall adopt, to the extent 
     practicable, procedures that are similar to those used by the 
     senior procurement executive of the Department of the Navy to 
     approve all technical requirements.
       (d) Assessment.--Within 180 days after the date of 
     enactment of this Act, the Comptroller General shall transmit 
     a report to the appropriate congressional committees that--
       (1) contains an assessment of current Coast Guard 
     acquisition and management capabilities to manage Level 1 and 
     Level 2 acquisitions;
       (2) includes recommendations as to how the Coast Guard can 
     improve its acquisition management, either through internal 
     reforms or by seeking acquisition expertise from the 
     Department of Defense; and
       (3) addresses specifically the question of whether the 
     Coast Guard can better leverage Department of Defense or 
     other agencies' contracts that would meet the needs of Level 
     1 or Level 2 acquisitions in order to obtain the best 
     possible price.

                    TITLE III--COAST GUARD PERSONNEL

     SEC. 301. CHIEF ACQUISITION OFFICER.

       (a) In General.--Chapter 3 of title 14, United States Code, 
     is amended by adding at the end the following:

     ``Sec. 55. Chief Acquisition Officer

       ``(a) Establishment of Chief Acquisition Officer.--There 
     shall be in the Coast Guard a Chief Acquisition Officer 
     selected by the Commandant who shall be a Rear Admiral or 
     civilian from the Senior Executive Service (career reserved) 
     and who meets the qualifications set forth under subsection 
     (b). The Chief Acquisition Officer shall serve at the 
     Assistant Commandant level and have acquisition management as 
     that individual's primary duty.
       ``(b) Qualifications.--
       ``(1) The Chief Acquisition Officer and any Flag Officer 
     serving in the Acquisitions Directorate shall be an 
     acquisition professional with a program manager level III 
     certification and must have at least 10 years experience in 
     an acquisition position, of which at least 4 years were spent 
     in one of the following qualifying positions:
       ``(A) Program executive officer.
       ``(B) Program manager of a Level 1 or Level 2 acquisition.
       ``(C) Deputy program manager of a Level 1 or Level 2 
     acquisition.
       ``(D) Project manager for a Level 1 or Level 2 acquisition.
       ``(E) Any other acquisition position of significant 
     responsibility in which the primary duties are supervisory or 
     management duties.
       ``(2) The Commandant shall periodically publish a list of 
     the positions designated under this subsection.
       ``(c) Authority and Functions of the Chief Acquisition 
     Officer.--The functions of the Chief Acquisition Officer 
     shall include--
       ``(1) monitoring the performance of programs and projects 
     on the basis of applicable performance measurements and 
     advising the Commandant, through the chain of command, 
     regarding the appropriate business strategy to achieve the 
     missions of the Coast Guard;
       ``(2) maximizing the use of full and open competition at 
     the prime contract and subcontract levels in the acquisition 
     of property, capabilities, assets, and services by the Coast 
     Guard by establishing policies, procedures, and practices 
     that ensure that the Coast Guard receives a sufficient number 
     of sealed bids or competitive proposals from responsible 
     sources to fulfill the Government's requirements, including 
     performance and delivery schedules, at the lowest cost or 
     best value considering the nature of the property, 
     capability, asset, or service procured;
       ``(3) making acquisition decisions in concurrence with the 
     technical authority of the Coast Guard, as designated by the 
     Commandant, and consistent with all other applicable laws and 
     decisions establishing procedures within the Coast Guard;
       ``(4) ensuring the use of detailed performance 
     specifications in instances in which performance based 
     contracting is used;
       ``(5) managing the direction of acquisition policy for the 
     Coast Guard, including implementation of the unique 
     acquisition policies, regulations, and standards of the Coast 
     Guard;
       ``(6) developing and maintaining an acquisition career 
     management program in the Coast Guard to ensure that there is 
     an adequate acquisition workforce;
       ``(7) assessing the requirements established for Coast 
     Guard personnel regarding knowledge and skill in acquisition 
     resources and management and the adequacy of such 
     requirements for facilitating the achievement of the 
     performance goals established for acquisition management;
       ``(8) developing strategies and specific plans for hiring, 
     training, and professional development; and
       ``(9) reporting to the Commandant, through the chain of 
     command, on the progress made in improving acquisition 
     management capability.''.
       (b) Application of Qualification Requirement.--Section 
     55(b) of title 14, United States Code, as amended by this 
     section, shall apply beginning October 1, 2011.
       (c) Clerical Amendment.--The table of sections at the 
     beginning of such chapter is amended by adding at the end the 
     following:

``55. Chief Acquisition Officer.''.
       (d) Elevation of Disputes to the Chief Acquisition 
     Officer.--Within 45 days after the elevation to the Chief 
     Acquisition Officer of any design or other dispute regarding 
     a Level 1 or Level 2 acquisition, the Commandant shall 
     provide to the appropriate congressional committees a 
     detailed description of the issue and the rationale 
     underlying the decision taken by the Chief Acquisition 
     Officer to resolve the issue.
       (e) Special Rate Supplements.--
       (1) Requirement to establish.--Not later than 1 year after 
     the date of enactment of this Act and in accordance with part 
     9701.333 of title 5, Code of Federal Regulations, the 
     Commandant shall establish special rate supplements that 
     provide higher pay levels for employees necessary to carry 
     out the amendment made by this section.
       (2) Subject to appropriations.--The requirement under 
     paragraph (1) is subject to the availability of 
     appropriations.

     SEC. 302. IMPROVEMENTS IN COAST GUARD ACQUISITION MANAGEMENT.

       (a) Program and Project Managers.--An individual may not be 
     assigned as the program manager for a Level 1 or Level 2 
     acquisition unless the individual holds a Level III 
     acquisition certification as a program manager.
       (b) Integrated Product Teams.--Integrated product teams, 
     and all teams that oversee integrated product teams, shall be 
     chaired by officers, members, or employees of the Coast 
     Guard.
       (c) Technical Authority.--The Commandant shall maintain or 
     designate the technical authority to establish, approve, and 
     maintain technical requirements. Any such designation shall 
     be made in writing and may not be delegated to the authority 
     of the Chief Acquisition Officer established by section 55 of 
     title 14, United States Code.
       (d) Designation of Positions in the Acquisition 
     Workforce.--
       (1) In general.--The Commandant shall designate a 
     sufficient number of positions to be in the Coast Guard's 
     acquisition workforce to perform acquisition-related 
     functions at Coast Guard headquarters and field activities.
       (2) Required positions.--In designating positions under 
     subsection (a), the Commandant shall include, at a minimum, 
     positions encompassing the following competencies and 
     functions:
       (A) Program management.
       (B) Systems planning, research, development, engineering, 
     and testing.
       (C) Procurement, including contracting.
       (D) Industrial and contract property management.

[[Page H8923]]

       (E) Life-cycle logistics.
       (F) Quality control and assurance.
       (G) Manufacturing and production.
       (H) Business, cost estimating, financial management, and 
     auditing.
       (I) Acquisition education, training, and career 
     development.
       (J) Construction and facilities engineering.
       (K) Testing and evaluation.
       (3) Acquisition management headquarter activities.--The 
     Commandant shall also designate as positions in the 
     acquisition workforce under paragraph (1) those acquisition-
     related positions located at Coast Guard headquarters units.
       (4) Appropriate expertise required.--The Commandant shall 
     ensure that each individual assigned to a position in the 
     acquisition workforce has the appropriate expertise to carry 
     out the responsibilities of that position.
       (e) Management Information System.--
       (1) In general.--The Commandant shall establish a 
     management information system capability to improve 
     acquisition workforce management and reporting.
       (2) Information maintained.--Information maintained with 
     such capability shall include the following standardized 
     information on individuals assigned to positions in the 
     workforce:
       (A) Qualifications, assignment history, and tenure of those 
     individuals assigned to positions in the acquisition 
     workforce or holding acquisition-related certifications.
       (B) Promotion rates for officers and members of the Coast 
     Guard in the acquisition workforce.
       (f) Report on Adequacy of Acquisition Workforce.--
       (1) In general.--The Commandant shall report to the 
     Congress by July 1 of each year on the scope of the 
     acquisition activities to be performed in the next fiscal 
     year and on the adequacy of the current acquisition workforce 
     to meet that anticipated workload.
       (2) Contents.--The report shall--
       (A) specify the number of officers, members, and employees 
     of the Coast Guard currently and planned to be assigned to 
     each position designated under subsection (d); and
       (B) identify positions that are understaffed to meet the 
     anticipated acquisition workload, and actions that will be 
     taken to correct such understaffing.
       (g) Appointments to Acquisition Positions.--The Commandant 
     shall ensure that no requirement or preference for officers 
     or members of the Coast Guard is used in the consideration of 
     persons for positions in the acquisition workforce.
       (h) Career Paths.--
       (1) Identification of career paths.--To establish 
     acquisition management as a core competency of the Coast 
     Guard, the Commandant shall--
       (A) ensure that career paths for officers, members, and 
     employees of the Coast Guard who wish to pursue careers in 
     acquisition are identified in terms of the education, 
     training, experience, and assignments necessary for career 
     progression of those officers, members, and employees to the 
     most senior positions in the acquisition workforce; and
       (B) publish information on such career paths.
       (2) Promotion parity.--The Commandant shall ensure that 
     promotion parity is established for officers and members of 
     the Coast Guard who have been assigned to the acquisition 
     workforce relative to officers and members who have not been 
     assigned to the acquisition workforce.
       (i) Balanced Workforce Policy.--In the development of 
     acquisition workforce policies under this section with 
     respect to any civilian employees or applicants for 
     employment, the Commandant shall, consistent with the merit 
     system principles set out in paragraphs (1) and (2) of 
     section 2301(b) of title 5, United States Code, take into 
     consideration the need to maintain a balanced workforce in 
     which women and members of racial and ethnic minority groups 
     are appropriately represented in Government service.
       (j) Guidance on Tenure and Accountability of Program 
     Managers.--
       (1) Issuance of guidance.--Not later than one year after 
     the date of enactment of this Act, the Commandant shall issue 
     guidance to address the qualifications, resources, 
     responsibilities, tenure, and accountability of program 
     managers for the management of acquisition programs and 
     projects. The guidance shall address, at a minimum--
       (A) the qualifications that shall be required of program 
     managers, including the number of years of acquisition 
     experience and the professional training levels to be 
     required of those appointed to program management positions;
       (B) authorities available to program managers, including, 
     to the extent appropriate, the authority to object to the 
     addition of new program requirements that would be 
     inconsistent with the parameters established for an 
     acquisition program; and
       (C) the extent to which a program manager who initiates a 
     new program or project will continue in management of that 
     program or project without interruption until the delivery of 
     the first production units of the program.
       (2) Strategy.--
       (A) In general.--Not later than 18 months after the date of 
     enactment of this Act, the Commandant shall develop a 
     comprehensive strategy for enhancing the role of Coast Guard 
     program managers in developing and carrying out acquisition 
     programs.
       (B) Matters to be addressed.--The strategy required by this 
     section shall address, at a minimum--
       (i) the creation of a specific career path and career 
     opportunities for individuals who are or may become program 
     managers, including the rotational assignments that will be 
     provided to program managers;
       (ii) the provision of enhanced training and educational 
     opportunities for individuals who are or may become program 
     managers;
       (iii) the provision of mentoring support to current and 
     future program managers by experienced senior executives and 
     program managers within the Coast Guard, and through 
     rotational assignments to the Department of Defense;
       (iv) the methods by which the Coast Guard will collect and 
     disseminate best practices and lessons learned on systems 
     acquisition to enhance program management throughout the 
     Coast Guard;
       (v) the templates and tools that will be used to support 
     improved data gathering and analysis for program management 
     and oversight purposes, including the metrics that will be 
     utilized to assess the effectiveness of Coast Guard program 
     managers in managing systems acquisition efforts;
       (vi) a description in detail of how the Coast Guard will 
     promote a balanced workforce in which women and members of 
     racial and ethnic minority groups are appropriately 
     represented in Government service; and
       (vii) the methods by which the accountability of program 
     managers for the results of acquisition programs will be 
     increased.

     SEC. 303. RECOGNITION OF COAST GUARD PERSONNEL FOR EXCELLENCE 
                   IN ACQUISITION.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, the Commandant shall commence 
     implementation of a program to recognize excellent 
     performance by individuals and teams comprised of officers, 
     members, and employees of the Coast Guard that contributed to 
     the long-term success of a Coast Guard acquisition program or 
     project.
       (b) Elements.--The program required by subsection (a) shall 
     include the following:
       (1) Specific award categories, criteria, and eligibility 
     and manners of recognition.
       (2) Procedures for the nomination by personnel of the Coast 
     Guard of individuals and teams comprised of officers, 
     members, and employees of the Coast Guard for recognition 
     under the program.
       (3) 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 Commandant shall establish for the purposes of 
     this program.
       (c) Award of Cash Bonuses.--As part of the program required 
     by subsection (a), the Commandant, subject to the 
     availability of appropriations, may award to any individual 
     recognized pursuant to the program a cash bonus to the extent 
     that the performance of such individual so recognized 
     warrants the award of such bonus.

     SEC. 304. ENHANCED STATUS QUO OFFICER PROMOTION SYSTEM.

       Chapter 11 of title 14, United States Code, is amended--
       (1) in section 253(a)--
       (A) by inserting ``and'' after ``considered,''; and
       (B) by striking ``, and the number of officers the board 
     may recommend for promotion'';
       (2) in section 258--
       (A) by inserting ``(a) In General.--'' before the existing 
     text;
       (B) in subsection (a) (as so designated) by striking the 
     colon at the end of the material preceding paragraph (1) and 
     inserting ``--''; and
       (C) by adding at the end the following:
       ``(b) Provision of Direction and Guidance.--
       ``(1) In addition to the information provided pursuant to 
     subsection (a), the Commandant may furnish the selection 
     board--
       ``(A) specific direction relating to the needs of the Coast 
     Guard for officers having particular skills, including 
     direction relating to the need for a minimum number of 
     officers with particular skills within a specialty; and
       ``(B) any other guidance that the Commandant believes may 
     be necessary to enable the board to properly perform its 
     functions.
       ``(2) Selections made based on the direction and guidance 
     provided under this subsection shall not exceed the maximum 
     percentage of officers who may be selected from below the 
     announced promotion zone at any given selection board 
     convened under section 251 of this title.'';
       (3) in section 259(a), by inserting after ``whom the 
     board'' the following: ``, giving due consideration to the 
     needs of the Coast Guard for officers with particular skills 
     so noted in specific direction furnished to the board by the 
     Commandant under section 258 of this title,''; and
       (4) in section 260(b), by inserting after ``qualified for 
     promotion'' the following: ``to meet the needs of the service 
     (as noted in specific direction furnished the board by the 
     Commandant under section 258 of this title)''.

     SEC. 305. COAST GUARD ACQUISITION WORKFORCE EXPEDITED HIRING 
                   AUTHORITY.

       (a) In General.--For purposes of sections 3304, 5333, and 
     5753 of title 5, United States Code, the Commandant may--

[[Page H8924]]

       (1) designate any category of acquisition positions within 
     the Coast Guard as shortage category positions; and
       (2) use the authorities in such sections to recruit and 
     appoint highly qualified persons directly to positions so 
     designated.
       (b) Limitation.--The Commandant may not appoint a person to 
     a position of employment under this subsection after 
     September 30, 2012.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Maryland (Mr. Cummings) and the gentleman from Arkansas (Mr. Boozman) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Maryland.


                             General Leave

  Mr. CUMMINGS. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days in which to revise and extend their remarks 
and to include extraneous material on H.R. 1665.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Maryland?
  There was no objection.
  Mr. CUMMINGS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, as chairman of the Subcommittee on Coast Guard and 
Maritime Transportation, ensuring that the Coast Guard can effectively 
manage its acquisition efforts and that it is fully accountable for its 
use of taxpayer hard-earned resources has been among my highest 
priorities.
  In his memorandum on Federal contracting management issued on March 
4, President Barack Obama argued that ``it is essential that the 
Federal Government have the capacity to carry out robust and thorough 
management of its contracts in order to achieve programmatic goals, 
avoid significant overcharges, and curb wasteful spending.''
  I authored the Coast Guard Acquisition Reform Act of 2009, H.R. 1665, 
in an effort to institutionalize within the Coast Guard the processes 
and procedures that will help the service meet this standard.
  I want to thank Congressman Oberstar, the chairman of the full 
Committee on Transportation and Infrastructure, for his diligent work 
on this bill and for his unwavering focus on effective oversight. He 
has tirelessly led the Transportation Committee's efforts to ensure 
that we fully account for the expenditure of every single taxpayer 
dollar in the transportation realm, and the United States public is the 
true beneficiary of his dedication.
  I also thank the ranking member of the full committee, Congressman 
Mica, and the ranking member of our subcommittee, Congressman LoBiondo, 
for working so closely and constructively with us on the drafting of 
this legislation.
  Since becoming the subcommittee chairman in January, 2007, I have 
convened four subcommittee hearings that have focused partially or 
entirely on Coast Guard acquisition efforts. The major focus of these 
hearings has been the multibillion-dollar Deepwater program that is 
intended to replace or rehabilitate the Coast Guard's air and surface 
assets.
  When the Coast Guard signed the initial Deepwater contract, the 
service lacked standardized acquisition processes. It lacked a proven 
process to guide the generation of asset requirements, designs, and 
acquisition strategies, and it had only limited acquisition management 
capability among its staff. Without the capacity to hold its 
contractors accountable for their performance, the consortium hired by 
the Coast Guard to implement the lead systems integration function for 
the Deepwater program essentially took the Coast Guard for a ride that 
wasted hundreds of millions of taxpayer dollars. Thus, the Government 
Accountability Office has detailed that of the more than $6 billion 
that has been appropriated for Deepwater since fiscal year 2002, nearly 
$300 million has been spent on projects that were canceled or 
subsequently restructured, including $95 million wasted in the failed 
effort to lengthen 110-foot patrol boats to 123 feet, a contract 
failure that the full Committee on Transportation and Infrastructure 
examined during an 11-hour investigative hearing convened by Chairman 
Oberstar; $119 million wasted on the first effort to develop a vertical 
unmanned aerial vehicle; and $66 million wasted on the first designs 
for the Offshore Patrol Cutter and the Fast Response Cutter. Mr. 
Speaker, I say we can do better.
  The Coast Guard's need for the new assets to be produced under 
Deepwater is without question, but the Coast Guard will not obtain 
assets that fully meet its mission requirement if it cannot effectively 
manage its procurement Process.

                              {time}  1700

  In response to the extensive criticisms leveled at the service's 
acquisition management capabilities, the Coast Guard's Commandant, 
Admiral Thad Allen, has created a new Acquisition Directorate. Under 
his leadership, the service issued and is continuing to revise a 
``Blueprint for Acquisition Reform.'' The service is also developing 
the process and capabilities that will enable it to assume the lead 
systems integration function.
  During our subcommittee's most recent hearing on acquisition issues, 
the Coast Guard announced that under an agreement signed the morning of 
our hearing, all options for extending the Deepwater contract with the 
Lockheed Martin-Northrop Grumman team beyond the date of expiration of 
the current award, January 24, 2011, were eliminated. I, of course, 
applaud this move. That said, during the hearing we also learned that 
certain challenges remain.
  Since 2007, the course of the acquisitions contained within the 
Deepwater program as currently envisioned have grown by more than $2 
billion and are now projected to approach $27 billion. Cost overruns in 
Coast Guard acquisition efforts remain a very serious concern.
  Further, this month the Government Accountability Office released a 
new report whose very title contains a serious warning. The title 
reads: ``As Deepwater Systems Integrator, Coast Guard is Reassessing 
Costs and Capabilities but Lags in Applying Its Disciplined Acquisition 
Approach.'' This report notes that the service has moved to procure the 
Fast Response Cutter, the first asset acquisition effort that the 
service is managing entirely in-house, without having in place all 
acquisition documentation required by its Major Systems Acquisition 
Manual. Even if the Coast Guard establishes the best possible 
management systems, they will be of no use if they are not followed.
  Further, while the service is requiring that its largest programs be 
managed by individuals with professional acquisition management 
qualifications, the service recently designated as the Program 
Executive Officer for the Coast Guard Acquisition Directorate an 
Admiral-select who lacked the highest available acquisition management 
qualifications, despite having a dozen captains who have achieved a 
Level III program management certification.
  Again, I say, we can do better. Through a bipartisan effort, we have 
crafted detailed legislation that responds directly to the challenges 
in the Coast Guard acquisition management that we have so thoroughly 
examined in the subcommittee and full committee, and that builds on the 
acquisition management reforms the Coast Guard has already implemented.
  H.R. 1665, the Coast Guard Acquisition Reform Act of 2009, as 
amended, would strengthen specific acquisition processes and establish 
personnel-related standards and policies for individuals in the Coast 
Guard's acquisition workforce. The legislation would bar the Coast 
Guard from using a private-sector lead systems integrator beginning 
September 30th, 2011, the date on which the use of private-sector lead 
systems integrators will end at the Department of Defense.
  The legislation would require the appointment of a Chief Acquisition 
Officer who, at the Commandant's choice, can be either a member of the 
military or a civilian member of the Senior Executive Service, but who 
must be a Level III Program Manager and who must have 10 years of 
professional experience in acquisition management.
  Additionally, the legislation will require that the Coast Guard put 
in place systems to ensure that it effectively and efficiently defines 
operational requirements before initiating acquisition efforts, and 
that all acquired assets undergo thorough developmental and operational 
testing to ensure that they will meet mission needs and pose no safety 
risks or threats to Coast Guard personnel.

[[Page H8925]]

  The legislation would also ensure that the service develops and 
critically maintains within its workforce the expertise that it will 
need to effectively and efficiently oversee acquisition efforts in the 
future by requiring the service to establish career paths in 
acquisition management. H.R. 1665 would also provide expedited hiring 
authority so that the service can quickly fill vacancies in its 
acquisition workforce.
  I, again, thank Chairman Oberstar, Ranking Member Mica, Ranking 
Member LoBiondo for their work on this legislation, and for making this 
truly a bipartisan effort. I urge my colleagues to support H.R. 1665, 
as amended, and look forward to working with our Senate colleagues to 
enact a final version that can be presented to President Obama for his 
signature.

         House of Representatives, Committee on Transportation and 
           Infrastructure,
                                    Washington, DC, July 10, 2009.
     Hon. Bennie G. Thompson,
     Chairman, Committee on Homeland Security, Washington, DC
       Dear Chairman Thompson: I write to you regarding H.R. 1665, 
     the ``Coast Guard Acquisition Reform Act of 2009''.
       I agree that provisions in H.R. 1665 are of jurisdictional 
     interest to the Committee on Homeland Security. I acknowledge 
     that by forgoing a sequential referral, your Committee is not 
     relinquishing its jurisdiction and I will fully support your 
     request to be represented in a House-Senate conference on 
     those provisions over which the Committee on Homeland 
     Security has jurisdiction in H.R. 1665.
       This exchange of letters will be inserted in the Committee 
     Report on H.R. 1665 and in the Congressional Record as part 
     of the consideration of this legislation in the House.
       I look forward to working with you as we prepare to pass 
     this important legislation.
           Sincerely,
                                           James L. Oberstar, M.C.
     Chairman.
                                  ____

                                         House of Representatives,


                               Committee on Homeland Security,

                                    Washington, DC, July 10, 2009.
     Hon. James L. Oberstar,
     Chairman, Committee on Transportation and Infrastructure, 
         Washington, DC.
       Dear Chairman Oberstar: I write to you regarding H.R. 1655, 
     the ``Coast Guard Acquisition Reform Act of 2009.''
       H.R. 1665 contains provisions that fall within the 
     jurisdiction of the Committee on Homeland Security. I 
     recognize and appreciate your desire to bring this 
     legislation before the House in an expeditious manner and, 
     accordingly, I will not seek a sequential referral of the 
     bill. However, agreeing to waive consideration of this bill 
     should not be construed as the Committee on Homeland Security 
     waiving, altering, or otherwise affecting its jurisdiction 
     over subject matters contained in the bill which fall within 
     its Rule X jurisdiction.
       Further, I request your support for the appointment of an 
     appropriate number of Members of the Committee on Homeland 
     Security to be named as conferees during any House-Senate 
     conference convened on H.R. 1665 or similar legislation. I 
     also ask that a copy of this letter and your response be 
     included in the legislative report on H.R. 1665 and in the 
     Congressional Record during floor consideration of this bill.
       I look forward to working with you as we prepare to pass 
     this important legislation.
           Sincerely,
                                               Bennie G. Thompson,
                                                         Chairman.

  Mr. Speaker, I reserve the balance of my time.
  The SPEAKER pro tempore. Without objection, the gentleman from New 
Jersey (Mr. LoBiondo) will control 20 minutes.
  There was no objection.
  Mr. LoBIONDO. Mr. Speaker, I yield myself such time as I may consume.
  I rise in support of H.R. 1665, the Coast Guard Acquisition Reform 
Act of 2009. I'd like to thank the chairman of the full committee, Mr. 
Oberstar. I'd like to thank Mr. Cummings and Mr. Mica for their help in 
moving and developing this important legislation. H.R. 1665 builds upon 
several provisions which passed the House during the 110th Congress and 
includes new language which I believe greatly improves the legislation.
  Like those bills in the previous Congress, the bill would reform the 
service's acquisition programs and procedures, prohibit the continued 
use of private-sector lead systems integrators, and establish a Chief 
Acquisition Officer to oversee all the Coast Guard's acquisition 
projects.
  H.R. 1665 would also require the Coast Guard to take several steps 
during the planning, production and acceptance period to enhance the 
Coast Guard's control over all parts of the process. Under the 
programmatic changes made by this bill, the Coast Guard will be able to 
use all of its many technical authorities to ensure that assets 
delivered meet the service's specifications and needs.
  Lastly, the bill includes two new provisions which will improve the 
Coast Guard's ability to staff acquisition positions with the most 
qualified candidates. The first is limited direct hiring authority 
which is based on existing authority available to the other Armed 
Services. Under this language, the Coast Guard will be able to directly 
hire civilian personnel with the needed acquisition expertise. The 
second will allow Coast Guard promotion boards to consider the need for 
specialized skills and qualifications of Coast Guard officers in areas 
like acquisitions. This language will provide Coast Guardsmen with the 
opportunity to specialize in limited duty areas, such as acquisition, 
without negatively impacting their promotional potential in the future.
  Mr. Speaker, I support this bill and urge other Members to do the 
same.
  I reserve the balance of my time.
  Mr. CUMMINGS. Mr. Speaker, we have no additional speakers, so I would 
reserve.
  Mr. LoBIONDO. We have no additional speakers, Mr. Speaker, so I yield 
back the balance of my time.
  Mr. CUMMINGS. Mr. Speaker, I yield myself such time as I may consume. 
I urge the Members of the House to vote for this very, very important 
bill. This is one that our committee and subcommittee have worked on 
for a long time. It is overdue, and it's an outstanding bipartisan 
effort.
  Mr. OBERSTAR. Mr. Speaker, I rise today in strong support of H.R. 
1665, the ``Coast Guard Acquisition Reform Act of 2009'', as amended.
  This legislation, authored by the Chairman of the Subcommittee on 
Coast Guard and Maritime Transportation, Mr. Cummings, is a thorough, 
comprehensive response to the challenges that have confronted the Coast 
Guard as it has worked to manage large-scale acquisition efforts.
  I also applaud the Ranking Member of the Full Committee, Congressman 
Mica, and the Ranking Member of the Coast Guard Subcommittee, 
Congressman LoBiondo, for their diligent work on this legislation.
  H.R. 1665 incorporates the lessons that the Committee on 
Transportation and Infrastructure has drawn from its extensive 
oversight of the Coast Guard's acquisition programs.
  Much of that oversight has focused on the Coast Guard's Deepwater 
program, a 25-year program to repair or replace the service's surface 
and air assets that is now projected to cost nearly $27 billion--a 
figure that is more than a $2 billion increase over the cost 
projections developed just two years ago.
  These oversight efforts have included a nearly 11-hour full Committee 
hearing that I convened in April 2007 to examine the results of an 
extensive Committee investigation that evaluated the multiple factors 
that contributed to the failure of the effort to lengthen 110-foot 
patrol boats to 123 feet.
  The oversight efforts have also included four separate Coast Guard 
Subcommittee hearings that have examined different aspects of the Coast 
Guard's acquisition programs.
  Through these tireless efforts, the Committee has developed a 
comprehensive picture of the challenges that have plagued the Coast 
Guard's acquisition efforts, including the use of personnel who had 
little experience managing a major systems acquisition, continued 
alteration of performance requirements even after major engineering 
milestones were passed, and failure to apply cost and performance 
measures to individual asset acquisitions within the Deepwater program. 
The Coast Guard has responded to these criticisms.
  The service has moved to take control of the lead systems integration 
function that had been contracted to the Lockheed Martin-Northrop 
Grumman team. The service has established an Acquisition Directorate 
and assigned individuals with the highest available professional 
qualifications in acquisition management to oversee the service's 
largest acquisition efforts.
  Further, the Coast Guard has expanded the role of the American Bureau 
of Shipping, and other qualified third parties, to ensure that procured 
assets meet the highest quality standards.
  However, more remains to be done, and H.R. 1665 takes the steps 
necessary to institutionalize within the Coast Guard the kind of 
effective management practices that should, if fully implemented, 
enable the service to avoid the procurement failures it has had in the 
past.
  Specifically, H.R. 1665 requires that all flag-level officers serving 
in the Acquisition Directorate have a Level III Program Management 
certification and 10 years of acquisition experience.

[[Page H8926]]

  Despite the service's new emphasis on placing in management positions 
those individuals who have professional acquisition management 
qualifications, a Captain selected for promotion to Rear Admiral was 
recently named to be the Program Executive Officer for Deepwater even 
though he lacked a Level III program manager certification at the time 
of his selection. This choice is even more surprising given that, as of 
February 2009, the Coast Guard had 27 military officers who had 
achieved a Level III program manager certification, including 12 
Captains.
  H.R. 1665 requires the Coast Guard to develop life-cycle cost 
estimates for projects expected to cost more than $10 million. 
Independent life-cycle cost estimates will be required for major 
acquisitions. With these estimates in place, we will know what it will 
cost to operate and maintain new assets before we commit to acquiring 
them.
  H.R. 1665 mandates that the Coast Guard firmly establish operational 
requirements before awarding production contracts--so that cost 
thresholds and testing and evaluation standards can, in turn, be firmly 
established.
  Further, H.R. 1665 imposes a breach ceiling on Coast Guard 
acquisitions--something that has long been imposed on Department of 
Defense acquisitions and that is overdue in the Coast Guard. 
Specifically, H.R. 1665 specifies that for any major acquisition, the 
Coast Guard must report to Congress when a cost overrun of greater than 
10 percent is likely to occur, a delay of more than 180 days is likely 
to occur, or a failure for a new asset or class of assets is 
anticipated. More stringent standards are required whenever higher cost 
over-runs or more extensive delays are anticipated.
  I note that H.R. 1665 is based, in part, on legislation considered 
and passed twice by this House in the 110th Congress.
  I urge my colleagues to support H.R. 1665.
  Ms. ROS-LEHTINEN. Mr. Speaker, I rise today to voice my support of 
H.R. 1665, the Coast Guard Acquisition Reform Act.
  I have the unique pleasure of representing over 265 miles of pristine 
Florida coastline, and I will never forget that it is the Coast Guard 
that keeps these waters safe.
  Two of the largest Coast Guard Sectors in the United States, Sector 
Miami and Sector Key West are located in my Congressional district.
  This act will direct the Coast Guard in their Acquisition efforts and 
make for more of full and open competition contracts.
  Overall, this act will be of benefit to the Coast Guard; however, 
being from a District heavily involved with the Coast Guard, I know 
that sections of the bill could use clarification and adjustment.
  Firstly, in Section 210, the Coast Guard is required to report to the 
appropriate congressional committees about any cost overruns.
  However, the reporting requirement is set a uniquely low threshold, a 
mere 10 percent.
  It would be more appropriate to set this reporting requirement in 
line with other Department of Defense programs, ranging from 15 percent 
to 25 percent.
  Also, in Section 302a, the act states that an individual may not be 
assigned as the acquisition program manager for a Level 1 or Level 2 
acquisition unless the individual holds a Level III acquisition 
certification as a program manager.
  In the interest of training Level III program manager's for Level 1 
projects, this act should leave the Coast Guards current practice in 
place.
  This would allow program managers to gain the experience they need 
before being assigned to the most important of acquisition projects.
  In Sec 301d, the act states that within 45 days after any design or 
other dispute regarding a Level 1 or Level 2 acquisition, the Coast 
Guard would be required to provide Congress a detailed description of 
the dispute and the rationale underlying any decision made by the Chief 
Acquisition Officer.
  In the interest of keeping burdensome reporting requirements to a 
minimum, the act should have added the word ``significant'' for any 
design dispute.
  The Coast Guard will make many fact-based and timely decisions on 
projects that may be internally disputed.
  Congress needs to be involved in significant problems that could 
affect results.
  Still, I urge all Members to recognize the crucial need to protect 
our nation by strengthening the United States' oldest continuous 
seagoing service, the United States Coast Guard.
  I urge my colleagues to vote ``yes'' on this act.
  Mr. CUMMINGS. Mr. Speaker, I yield back my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Maryland (Mr. Cummings) that the House suspend the rules 
and pass the bill, H.R. 1665, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Mr. LoBIONDO. Mr. Speaker, I object to the vote on the ground that a 
quorum is not present and make the point of order that a quorum is not 
present.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.
  The point of no quorum is considered withdrawn.

                          ____________________