[House Report 117-492]
[From the U.S. Government Publishing Office]


117th Congress    }                                    {      Report
                        HOUSE OF REPRESENTATIVES
 2d Session       }                                    {      117-492

======================================================================

 
  DEPARTMENT OF VETERANS AFFAIRS INFORMATION TECHNOLOGY REFORM ACT OF 
                                  2021

                                _______
                                

 September 26, 2022.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

  Mr. Takano, from the Committee on Veterans' Affairs, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 2250]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Veterans' Affairs, to whom was referred 
the bill (H.R. 2250) to amend title 38, United States Code, to 
improve the management of information technology projects and 
investments of the Department of Veterans Affairs, and for 
other purposes, having considered the same, reports favorably 
thereon with an amendment and recommends that the bill as 
amended do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     5
Background and Need for Legislation..............................     6
Hearings.........................................................     7
Subcommittee Consideration.......................................     7
Committee Consideration..........................................     7
Committee Votes..................................................     7
Committee Oversight Findings.....................................     8
Statement of General Performance Goals and Objectives............     8
New Budget Authority, Entitlement Authority, and Tax Expenditures     8
Earmarks and Tax and Tariff Benefits.............................     8
Committee Cost Estimate..........................................     8
Congressional Budget Office Estimate.............................     8
Federal Mandates Statement.......................................    10
Advisory Committee Statement.....................................    10
Constitutional Authority Statement...............................    10
Applicability to Legislative Branch..............................    10
Statement on Duplication of Federal Programs.....................    10
Disclosure of Directed Rulemaking................................    11
Section-by-Section Analysis of the Legislation...................    11
Changes in Existing Law Made by the Bill as Reported.............    17

    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Department of Veterans Affairs 
Information Technology Reform Act of 2021''.

SEC. 2. MANAGEMENT OF MAJOR INFORMATION TECHNOLOGY PROJECTS.

  (a) In General.--Chapter 81 of title 38, United States Code, is 
amended by adding at the end the following new subchapter:

    ``SUBCHAPTER VI--INFORMATION TECHNOLOGY PROJECTS AND ACTIVITIES

``Sec. 8171. Definitions

  ``In this subchapter:
          ``(1) The term `appropriate congressional committees' means--
                  ``(A) the Committee on Veterans' Affairs and the 
                Subcommittee on Military Construction, Veterans Affairs 
                and Related Agencies of the Committee on Appropriations 
                of the Senate; and
                  ``(B) the Committee on Veterans' Affairs and the 
                Subcommittee on Military Construction, Veterans Affairs 
                and Related Agencies of the Committee on Appropriations 
                of the House of Representatives.
          ``(2) The term `information technology' has the meaning given 
        that term in section 11101 of title 40.
          ``(3) The term `information technology project' means a 
        project or program of the Department (including a project or 
        program of any element of the Department) for, or including, 
        the acquisition or implementation of information technology. In 
        cases where the Secretary transmits to the Director of the 
        Office of Management and Budget information regarding 
        information technology investments, which may consist of 
        individual or multiple projects, such term refers to an 
        individual project or program or a grouping of multiple 
        projects or programs resulting in the acquisition or 
        implementation of discrete information technology.
          ``(4) The term `life cycle costs' means all direct and 
        indirect costs to acquire, implement, operate, and maintain 
        information technology, including with respect to costs of any 
        element of the Department.
          ``(5) The term `major information technology project' means 
        an information technology project if--
                  ``(A) the project is designated by the Secretary, the 
                Chief Information Officer of the Department, or the 
                Director of the Office of Management and Budget as a 
                major information technology investment, as defined in 
                section 11302 of title 40; or
                  ``(B) the dollar value of the project is estimated by 
                the Secretary to exceed $500,000,000 (as adjusted for 
                inflation pursuant to section 1908 of title 41) for the 
                total life cycle costs of the project.
          ``(6) The term `business owner' means, with respect to an 
        information technology project, the program manager, project 
        manager, or other supervisory official of the Department 
        responsible for the project.

``Sec. 8172. Management of major information technology projects

  ``(a) Cost, Schedule, and Performance Information.--(1) The Secretary 
may not obligate or expend funds for any major information technology 
project that begins after the date of the enactment of the Department 
of Veterans Affairs Information Technology Reform Act of 2021 unless 
the Secretary, acting through the Chief Information Officer of the 
Department, submits to the appropriate congressional committees a 
report containing information on the cost, schedule, and performance of 
such project, as generated by the business owner of the project.
  ``(2) Each report submitted under paragraph (1) for a project shall 
include, with respect to such project, the following:
          ``(A) An estimate of acquisition costs, implementation costs, 
        and life cycle costs.
          ``(B) An intended implementation schedule indicating 
        significant milestones, initial operating capability, and full 
        operating capability or completion.
          ``(C) Key business, functional, and performance objectives.
  ``(b) Baseline.--(1) The Secretary shall use the information on the 
cost, schedule, and performance of a major information technology 
project included in the report under subsection (a) as the baseline 
against which changes or variances are measured during the life cycle 
of such project.
  ``(2) The Secretary shall--
          ``(A) annually update the baseline of a major information 
        technology project pursuant to subsection (c); and
          ``(B) include such updated baseline in the documents 
        providing detailed information on the budget for the Department 
        that the Secretary submits to Congress in conjunction with the 
        President's budget submission pursuant to section 1105 of title 
        31.
  ``(c) Changes and Variances.--(1) Not later than 60 days after the 
date on which the Secretary identifies a change or variance described 
in paragraph (2) in the cost, schedule, or performance of a major 
information technology project, the Secretary, acting through the Chief 
Information Officer, shall submit to the appropriate congressional 
committees a notification of such change or variance, including a 
description and explanation for such change or variance.
  ``(2) A change or variance in the cost, schedule, or performance of a 
major information technology project described in this paragraph is--
          ``(A) with respect to the acquisition, implementation, or 
        life cycle cost of the project, or development increment 
        therein, a change or variance that is 10 percent or greater 
        compared to the baseline;
          ``(B) with respect to the schedule for a development 
        increment or for achieving a significant milestone, initial 
        operating capability, or full operating capability, or for the 
        final completion of the project, a change or variance that is 
        180 days or greater compared to the baseline; or
          ``(C) with respect to the performance, an instance where a 
        key business, functional, or performance objective is not 
        attained, or is not anticipated to be attained, in whole or in 
        part.
  ``(d) Management.--The Secretary shall ensure that each major 
information technology project is managed by an interdisciplinary team 
consisting of the following:
          ``(1) A project manager who is--
                  ``(A) certified in project management at level three 
                by the Department, the Federal Acquisition Institute 
                pursuant to section 1201 of title 41, or the Department 
                of Defense pursuant to section 1701a of title 10, or 
                who holds an equivalent certification by a private 
                sector project management certification organization, 
                as determined appropriate by the Secretary; and
                  ``(B) an employee of the Office of Information and 
                Technology of the Department or an employee of an 
                element of the Department at which the project 
                originates.
          ``(2) A functional lead who is an employee of the element of 
        the Department at which the project originates.
          ``(3) A technical lead who is an employee of the Office of 
        Information and Technology of the Department.
          ``(4) A contracting officer.
          ``(5) Sufficient other project management, functional, 
        technical, and procurement personnel as the Secretary 
        determines appropriate.

``Sec. 8173. Information technology activities of the Financial 
                    Services Center

  ``(a) Management.--Consistent with sections 11302 and 11319 of title 
40--
          ``(1) the Chief Information Officer of the Department shall--
                  ``(A) exercise authority over the management, 
                governance, and oversight processes relating to 
                existing or proposed information technology of the 
                Financial Services Center of the Department, or such 
                successor office; and
                  ``(B) supervise the information technology employees 
                and contractors of the Financial Services Center; and
          ``(2) the Director of the Financial Services Center of the 
        Department, or the head of such successor office, may not enter 
        into a contract or other agreement for information technology 
        or information technology services unless the contract or other 
        agreement has been reviewed and approved by the Chief 
        Information Officer.
  ``(b) Oversight.--The Chief Information Officer shall have oversight 
and operational authority over all information security practices of 
the Financial Services Center of the Department.

``Sec. 8174. Submission of annual reviews of information technology

  ``(a) In General.--The Secretary, acting through the Chief 
Information Officer of the Department, shall submit to the appropriate 
congressional committees each annual review of the information 
technology portfolio of the Department conducted pursuant to section 
11319(d)(3) of title 40.
  ``(b) First Submission.--The first annual review submitted under 
subsection (a) shall include a copy of each previous annual review 
conducted under section 11319(d)(3) of title 40.

``Sec. 8175. Information technology matters to be included in budget 
                    justification materials for the Department

  ``(a) List of Information Technology Projects in Effect.--The 
Secretary shall ensure that whenever the budget justification materials 
are submitted to Congress in support of the Department budget for a 
fiscal year (as submitted with the budget of the President for such 
fiscal year under section 1105(a) of title 31), such budget 
justification materials include a list of every information technology 
project currently in effect at the Department (including not only 
congressional projects and subprojects as determined by the Director of 
the Office of Management and Budget or the Secretary).
  ``(b) Prioritized List of Unfunded Projects.--(1) In addition to the 
list included in the budget justification materials required by 
subsection (a), the Secretary shall ensure that the budget 
justification materials described in such subsection also include 
summary descriptions and a prioritized list, in rank order, of every 
information technology project of the Department, proposed or intended 
to be proposed for the following one, two, or three fiscal years, that 
is unfunded as of the time of the inclusion of the list under this 
paragraph.
  ``(2) In producing the list required by paragraph (1), the Secretary 
shall--
          ``(A) ensure such list represents a ranking of all proposed 
        information technology projects that reflects the needs of all 
        elements of the Department;
          ``(B) produce one unified list for the entire Department 
        demonstrating how the various proposed information technology 
        projects of each of the elements of the Department rank in 
        priority with the information technology projects of the other 
        elements of the Department; and
          ``(C) ensure that the list--
                  ``(i) does not disaggregate and rank information 
                technology projects based on element of the Department; 
                and
                  ``(ii) does identify the element of the Department 
                requesting the information technology project.
  ``(3)(A) In producing each list under paragraph (1), the Secretary 
shall prioritize and rank each information technology project based on 
an assessment of each of the following factors:
          ``(i) Degree of collaboration between business owners and the 
        Chief Information Officer with respect to joint functional-
        technical planning, requirements, and management.
          ``(ii) Operational or efficiency benefits to employees of the 
        Department created or produced by the information technology 
        project.
          ``(iii) The life cycle cost of the information technology 
        project.
          ``(iv) The cost savings or cost avoidance yielded by the 
        information technology project.
          ``(v) Time to completion of the information technology 
        project.
          ``(vi) The difficulty of the information technology project, 
        the likelihood the information technology project will be 
        completed, or the risks associated with undertaking the 
        information technology project.
          ``(vii) Tangible benefits to veterans created or produced by 
        the information technology project.
          ``(viii) Such other factors as the Secretary considers 
        appropriate.
  ``(B) The Secretary shall ensure that each list produced under 
paragraph (1) includes, for each information technology project 
included in the list, a brief description of the findings of the 
Secretary with respect to each assessment carried out by the Secretary 
for each factor for the information technology project under 
subparagraph (A).
  ``(c) Projected Funding Needs.--(1) In addition to the matters 
included under subsections (a) and (b), the Secretary shall ensure that 
the budget justification materials described in subsection (a) also 
include a projection of the one-year, two-year, and three-year funding 
needs of the Department for information technology, disaggregated by 
portfolio and product line of the Department that requires the funding.
  ``(2) In addition to the projections under paragraph (1), the 
Secretary shall include a description of the following, with respect to 
each of the periods set forth in such paragraph, disaggregated by major 
business line of the Department:
          ``(A) The information technology infrastructure and equipment 
        requirements.
          ``(B) The funding required for development.
          ``(C) The funding required for operations and maintenance.
          ``(D) The funding required by cybersecurity.
          ``(E) Such other categories of the information technology 
        needs of the Department as the Secretary considers relevant and 
        important.''.
  (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by adding at the end the following:

     ``subchapter vi--information technology projects and activities

``8171. Definitions.
``8172. Management of major information technology projects.
``8173. Information technology activities of the Financial Services 
Center.
``8174. Submission of annual reviews of information technology.
``8175. Information technology matters to be included in budget 
justification materials for the Department.''.

  (c) Application; Report.--
          (1) Current and new projects.--Except as specifically 
        provided in subsection (a) of section 8172 of title 38, United 
        States Code, as added by subsection (a) of this section, such 
        section 8172 shall apply with respect to major information 
        technology projects that begin before, on, or after the date of 
        the enactment of this Act.
          (2) Report on current projects.--
                  (A) In general.--Not later than 90 days after the 
                date of the enactment of this Act, the Secretary of 
                Veterans Affairs shall submit to the appropriate 
                congressional committees a report on each major 
                information technology project that the Secretary is 
                carrying out as of the date of the report.
                  (B) Contents.--The report submitted under 
                subparagraph (A) shall contain, with respect to each 
                project described in such subparagraph, information on 
                the cost, schedule, and performance of the project as 
                described in subsection (a) of section 8172 of such 
                title, as so added.
          (3) Definitions.--In this subsection, the terms ``appropriate 
        congressional committees'' and ``major information technology 
        project'' have the meanings given those terms in section 8171 
        of title 38, United States Code, as added by subsection (a) of 
        this section.
  (d) Effective Date of Requirement for Projects in Budget 
Justification Materials.--Subsection (c) of section 8175 of such title, 
as added by subsection (a) of this section, shall take effect on the 
first Monday in the second January beginning after the date of the 
enactment of this Act.

SEC. 3. REPORT ON INFORMATION TECHNOLOGY DASHBOARD INFORMATION.

  (a) Report.--Not later than 90 days after the date of the enactment 
of this Act, the Secretary of Veterans Affairs, acting through the 
Chief Information Officer of the Department of Veterans Affairs, shall 
submit to the appropriate congressional committees a report 
containing--
          (1) an explanation of the ratings, rankings, and risk 
        categorizations used by the Chief Information Officer pursuant 
        to subparagraph (C) of section 11302(c)(3) of title 40, United 
        States Code, with respect to the information technology 
        dashboard of the Office of Management and Budget developed 
        under such section; and
          (2) copies of supporting or explanatory information provided 
        by the Chief Information Officer to the Office of Management 
        and Budget with respect to submissions by the Chief Information 
        Officer to the information technology dashboard for the fiscal 
        year in which the report is submitted (other than information 
        not otherwise made public pursuant to such section).
  (b) Appropriate Congressional Committees Defined.--In section, the 
term ``appropriate congressional committees'' has the meaning given 
such term in section 8171 of title 38, United States Code, as added by 
section 2.

                          Purpose and Summary

    H.R. 2250 was introduced by Representative Matthew M. 
Rosendale, Sr. of Montana on March 26, 2021. H.R. 2250, as 
amended, establishes a new reporting regime for the Department 
of Veterans Affairs' (VA) major projects concerning or 
involving information technology (IT), places the IT activities 
of the Financial Services Center of the Department under the 
supervision of the Office of Information and Technology of the 
Department, requires reporting to Congress of certain 
information provided by VA to the Office of Management and 
Budget (OMB) under the Federal Information Technology 
Acquisition Reform Act, and sets new requirements for 
explanatory information in VA's budget justification materials.

                  Background and Need for Legislation

    The Department of Veterans Affairs' management of major 
acquisitions and projects concerning, or involving, IT and its 
budget justification materials pertaining to IT are 
consistently inadequate.
    The VA Office of Information and Technology (OIT) was 
created in 2006, along with a centralized IT appropriation, to 
consolidate the IT activities of the Veterans Health 
Administration, Veterans Benefits Administration, National 
Cemetery Administration, and VA staff offices as well as the 
enterprise technology infrastructure shared among them. While 
this reform increased the visibility of VA's technology needs 
and improved coordination in some respects, dissatisfaction has 
persisted within the Department as well as externally with 
OIT's ability to prioritize and execute the various VA 
organizational elements' escalating, and at times competing, 
needs. While the IT appropriation has increased since its 
creation from about $1.2 billion to more than $4.8 billion, 
along with the Department's size and complexity, its budget 
justification materials have not sufficiently represented the 
activities of individual projects or the extent of the 
Department's projected, long-term IT needs.
    In recent years, VA has undertaken an increasing number of 
major acquisitions and projects seeking to modernize its 
business operations and systems. Only one has been completed, 
several have failed or been abandoned, and most continue to 
struggle. None has been authorized by Congress. This is 
motivated by a confluence of factors, including VA's rapid 
growth over the past decade, the prevailing attitude in the 
Department that the management of such major acquisitions is 
not a core mission, and a historical precedence in VA's 
authorizing committees of not authorizing or becoming actively 
involved in such projects. However, even if the authorizing 
committees sought to authorize such projects, they presently 
lack, and the Department does not provide, the information 
necessary to do so. Indeed, VA provides extensive cost, 
schedule, and performance information on its major 
acquisitions, projects, and other technology investments, 
albeit not in any standard format or regular cadence, but this 
is always done ex post facto, after funds have been obligated 
and work has commenced.
    VA's budget justification materials regarding IT are 
lengthy but incomplete and unrepresentative as to the 
activities of individual projects, the Department's performance 
with respect to its technology goals, or VA's projected, long-
term, and unmet needs. As a foundational matter, not all budget 
justification materials relevant to IT are found in the 
Information Technology section of the Medical Programs and 
Information Technology volume. The project information which is 
included concerns only so-called ``Congressional Projects,'' 
which are a subset of all projects selected by OMB. Information 
as to goals and actual performance is descriptive but rarely 
quantitative and is inconsistent from year to year. The budget 
justification materials contain scant information about 
projected or long-term financial needs; they discuss technical 
debt and the magnitude of outdated or otherwise inadequate 
hardware and software but typically fail to connect this to 
dollars. Finally, the budget request and its justification 
materials seem to operate based on the premise, which flies in 
the face of actual experience and the public statements of 
successive VA leaders, that the IT request and resulting 
appropriation are necessarily equal to the need and, by 
extension, that meritorious but unfunded IT projects or 
investments do not exist.
    The Subcommittee on Technology Modernization held hearings 
on OIT's organization and operations on April 2, 2019; VA 
cybersecurity practices on November 14, 2019 and May 20, 2020; 
VA IT budget justification materials on July 1, 2021; and OIT's 
strategic priorities on September 30, 2021. The above 
observations and inferences were gathered from testimony during 
these hearings as well as Subcommittee staff's numerous private 
meetings and written inquiries to VA.

                                Hearings

    On October 7, 2021, the Subcommittee on Technology 
Modernization held a legislative hearing on H.R. 2250; H.R. 
2326; H.R. 4591; and a draft bill, the Department of Veterans 
Affairs Demographic Collection Improvement Act of 2021. The 
following witnesses testified: Mr. Paul Brubaker, Acting 
Principal Deputy Assistant Secretary for Information and 
Technology, U.S. Department of Veterans Affairs; Mr. Kshemendra 
Paul, Chief Data Officer, U.S. Department of Veterans Affairs; 
Mr. Patrick Murray, Director, National Legislative Service, 
Veterans of Foreign Wars of the United States; Ms. Jennifer 
Dane, Executive Director and Chief Executive Officer, Modern 
Military Association of America; Lindsay Church, Executive 
Director, Minority Veterans of America.

                       Subcommittee Consideration

    There was no Subcommittee markup of H.R. 2250.

                        Committee Consideration

    On November 4, 2021, the full Committee met in an open 
markup session, a quorum being present, and ordered H.R. 2250, 
as amended, favorably reported to the House of Representatives 
by voice vote. During consideration of the bill, the following 
amendment was considered:
    An amendment in the nature of a substitute offered by 
Representative Mike Bost of Illinois. The amendment revised the 
new sections 8171, 8172, 8173, and 8174 added by the bill to 
chapter 81 of title 38, United States Code, to reflect 
technical assistance from VA as well as discussions with the 
Senate Committee on Veterans' affairs to harmonize H.R. 2250 
with S. 731. The amendment also added a new section 8175 to 
chapter 81 of title 38, United States Code, which was contained 
in S. 731, reflecting discussions with the Senate Committee on 
Veterans' Affairs since both bills' introductions. Finally, the 
amendment deleted section 3 of the bill, regarding the 
suitability of cloud migration investments, which had been 
determined unnecessary.

                            Committee Votes

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, there were no recorded votes 
taken on the amendment in the nature of a substitute or in 
connection with ordering H.R. 2250, as amended, reported to the 
House. The amendment in the nature of a substitute was adopted 
by voice vote. A motion by Representative Mike Bost of Illinois 
to report H.R. 2250, as amended, favorably to the House of 
Representatives was agreed to by voice vote.

                      Committee Oversight Findings

    In compliance with clause 3(c)(1) of rule XIII and clause 
(2)(b)(1) of rule X of the Rules of the House of 
Representatives, the Committee's oversight findings and 
recommendations are reflected in the descriptive portions of 
this report.

         Statement of General Performance Goals and Objectives

    In accordance with clause 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goals and objectives are to improve the Department of Veterans 
Affairs' ability to meet its own performance goals relevant to 
technology within its Strategic Plan as well as carry out its 
Digital Modernization Strategy, and improve the descriptive 
information relevant to technology in the Department's budget 
justification materials.

           New Budget Authority, Entitlement Authority, and 
                            Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee adopts as its 
own the estimate of new budget authority, entitlement 
authority, or tax expenditures or revenues contained in the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to section 402 of the Congressional 
Budget Act of 1974.

                  Earmarks and Tax and Tariff Benefits

    H.R. 2250, as amended, does not contain any Congressional 
earmarks, limited tax benefits, or limited tariff benefits as 
defined in clause 9 of rule XXI of the Rules of the House of 
Representatives.

                        Committee Cost Estimate

    Pursuant to clause 3(d)(1) of rule XIII, the Committee 
adopts as its own the cost estimate on H.R. 2250, as amended, 
prepared by the Director of the Congressional Budget Office 
pursuant to section 402 of the Congressional Budget Act of 
1974.

               Congressional Budget Office Cost Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
for H.R. 2250, as amended, provided by the Congressional Budget 
Office pursuant to section 402 of the Congressional Budget Act 
of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                 Washington, DC, February 14, 2022.
Hon. Mark Takano,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2250, the 
Department of Veterans Affairs Information Technology Reform 
Act of 2021.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Logan Smith.
            Sincerely,
                                         Phillip L. Swagel,
                                                          Director.
    Enclosure.

    	[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    

    H.R. 2250 would change how the Department of Veterans 
Affairs (VA) manages information technology (IT) projects. 
Specifically, the bill would:
           Require that all VA IT projects be managed 
        by interdisciplinary teams that meet a specific list of 
        qualifications,
           Increase requirements for reporting 
        deviations in the cost and schedule of IT projects; 
        and,
           Require VA to provide additional information 
        on unfunded IT projects in its annual budget 
        submission, as well as other reporting requirements.
    For this estimate, CBO assumes that H.R. 2250 will be 
enacted in the middle of fiscal year 2022.
    Although VA generally follows governmentwide IT-reporting 
requirements, and thus now meets some of the bill's 
requirements, CBO estimates that the agency would need 
additional human and IT resources to meet all of the bill's 
requirements. Using information from VA, CBO estimates that the 
agency would need the equivalent of 10 full-time employees and 
that salaries and expenses would average $130,000 per person. 
CBO estimates that those personnel costs would total $4 million 
over the 2022-2026 period. In addition, using information from 
VA, CBO estimates that the necessary IT resources would cost $2 
million over the 2022-2026 period. In total, implementing the 
bill would cost $6 million over the period. Such spending would 
be subject to the availability of appropriated funds.
    The costs of the legislation, detailed in Table 1, fall 
within budget function 700 (veterans benefits and services).

               TABLE 1.--ESTIMATED INCREASES IN SPENDING SUBJECT TO APPROPRIATION UNDER H.R. 2250
----------------------------------------------------------------------------------------------------------------
                                                                        By fiscal year, millions of dollars--
                                                                   ---------------------------------------------
                                                                     2022   2023   2024   2025   2026  2022-2026
----------------------------------------------------------------------------------------------------------------
Personnel:
    Estimated Authorization.......................................  .....      1      1      1      1          4
    Estimated Outlays.............................................  .....      1      1      1      1          4
Information Technology:
    Estimated Authorization.......................................      2      0      0      0      0          2
    Estimated Outlays.............................................      1      1  .....      0      0          2
Total Changes:
    Estimated Authorization.......................................      2      1      1      1      1          6
    Estimated Outlays.............................................      1      2      1      1      1          6
----------------------------------------------------------------------------------------------------------------
* = between zero and $500,000.

    The CBO staff contact for this estimate is Logan Smith. The 
estimate was reviewed by Leo Lex, Deputy Director of Budget 
Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates regarding H.R. 2250, as amended, prepared by the 
Director of the Congressional Budget Office pursuant to section 
423 of the Unfunded Mandates Reform Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act would be created by H.R. 
2250, as amended.

                 Statement of Constitutional Authority

    Pursuant to Article I, section 8 of the United States 
Constitution, H.R. 2250, as amended, is authorized by Congress' 
power to ``provide for the common Defense and general Welfare 
of the United States.''

                  Applicability to Legislative Branch

    The Committee finds that H.R. 2250, as amended, does not 
relate to the terms and conditions of employment or access to 
public services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

              Statement on Duplication of Federal Programs

    Pursuant to clause 3(c)(5) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that no provision 
of H.R. 2250, as amended, establishes or reauthorizes a program 
of the Federal Government known to be duplicative of another 
Federal program, a program that was included in any report from 
the Government Accountability Office to Congress pursuant to 
section 21 of Public Law 111-139, or a program related to a 
program identified in the most recent Catalog of Federal 
Domestic Assistance.

                   Disclosure of Directed Rulemaking

    Pursuant to clause 3(c)(5) of rule XIII, the Committee 
estimates that H.R. 2250, as amended, contains no directed rule 
making that would require the Secretary to prescribe 
regulations.

             Section-by-Section Analysis of the Legislation


Sec. 1. Short title

    Section 1 names the Act the ``Department of Veterans 
Affairs Information Technology Reform Act of 2021''.

Sec. 2. Management of major information technology projects

    Section 2 amends chapter 81 of title 38, United State Code 
to add a new subchapter VI, Information Technology Projects and 
Activities. This subchapter contains the new sections 8171, 
8172, 8173, 8174, and 8175.
    Section 8171 contains definitions. The ``appropriate 
congressional committees,'' to which the reporting mandated in 
the bill is directed, are the Committees on Veterans' Affairs 
of the House and Senate and the Subcommittees on Military 
Construction, Veterans' Affairs, and Related Agencies of the 
Committees on Appropriations of the House and Senate. The term 
``information technology'' is defined in section 11101 of title 
40, as follows:
          (6) Information technology.--The term ``information 
        technology''--
                  (A) with respect to an executive agency means 
                any equipment or interconnected system or 
                subsystem of equipment, used in the automatic 
                acquisition, storage, analysis, evaluation, 
                manipulation, management, movement, control, 
                display, switching, interchange, transmission, 
                or reception of data or information by the 
                executive agency, if the equipment is used by 
                the executive agency directly or is used by a 
                contractor under a contract with the executive 
                agency that requires the use--
                          (i) of that equipment; or
                          (ii) of that equipment to a 
                        significant extent in the performance 
                        of a service or the furnishing of a 
                        product;
                  (B) includes computers, ancillary equipment 
                (including imaging peripherals, input, output, 
                and storage devices necessary for security and 
                surveillance), peripheral equipment designed to 
                be controlled by the central processing unit of 
                a computer, software, firmware and similar 
                procedures, services (including support 
                services), and related resources; but
                  (C) does not include any equipment acquired 
                by a federal contractor incidental to a federal 
                contract.
This definition, created by P.L. 107-217 in 2002, makes 
repeated mention of ``equipment'' but, crucially, also includes 
``. . . software, firmware and similar procedures, services 
(including support services), and related resources''. Since 
2002, software has become a much larger proportion of the 
overall IT marketplace than equipment. Notwithstanding that 
fact, the term ``information technology'' remains sufficiently 
expansive. The meaning of the term ``information technology 
project'' is derived from the definition of ``information 
technology''; it is, simply, ``a project or program of the 
Department (including a project or program of any element of 
the Department) for, or including, the acquisition or 
implementation of information technology.'' This is not limited 
to projects originating from or managed by OIT. On the 
contrary, it includes projects originating from, managed by, or 
for the benefit of the Veterans Benefits Administration, 
Veterans Health Administration, National Cemetery 
Administration, VA staff offices, or any other organizational 
element of the Department. The term ``information technology 
project (emphasis added)'' is inclusive of ``projects'' as well 
as ``programs'' in recognition of the fact that these terms are 
sometimes used by VA officials and in documents interchangeably 
while at other times used differently, with ``project'' 
connoting a smaller or temporary effort, and ``program'' 
connoting a larger or permanent effort. (To clarify any 
ambiguity in how these words are used in practice, the 
legislation includes the term ``major (emphasis added) 
information technology project'', discussed later.) The second 
sentence of the definition of ``information technology 
project'' clarifies the unit of reporting: in other words, how 
a project or program may consist of multiple consolidated, 
subordinated, or component projects or programs in the same 
manner that an information system may consist of multiple 
component systems. The ``information technology project'' to be 
reported is the one which results in the acquisition or 
implementation of a discrete information technology capability. 
Information shall be reported to the appropriate congressional 
committees in the same manner, using the same unit of 
reporting, as reported to OMB. The ``term life cycle costs'' 
``means all direct and indirect costs to acquire, implement, 
operate, and maintain information technology, including with 
respect to costs of any element (emphasis added) of the 
Department.'' This definition is not limited to costs incurred 
or assigned to OIT. The term ``major information technology 
project'' sets forth which information technology projects are 
``major.'' This is a two-pronged definition, including those 
projects that are designated as such by the ``Secretary, the 
Chief Information Officer of the Department, or the Director of 
the Office of Management and Budget as a major information 
technology investment, as defined in section 11302 of title 
40'', or when ``the dollar value of the project is estimated by 
the Secretary to exceed $500,000,000 (as adjusted for inflation 
pursuant to section 1908 of title 41) for the total life cycle 
costs of the project.'' As a result, this definition includes 
those projects or ``investments,'' which has a similar meaning 
to ``information technology project,'' already being reported 
by VA to OMB by virtue of their designation as ``major'' as 
well as other projects or investments not already being 
reported but whose dollar values warrant coverage. Finally, the 
term ``business owner'' means, ``with respect to an information 
technology project, the program manager, project manager, or 
other supervisory official of the Department responsible for 
the project.'' This term's purpose is to specify which VA 
officials are to generate or compile the information ultimately 
transmitted to the appropriate congressional committees by the 
Chief Information Officer.
    Section 8172 sets forth the reporting regime for major 
information technology projects. The Secretary is prohibited 
from obligating or expending funds for any new major 
information technology project until the Chief Information 
Officer submits to the appropriate congressional committees a 
report containing certain cost, schedule, and performance 
information for the project. The purpose of this requirement is 
to give the House and Senate Committees on Veterans' Affairs 
the necessary information, in advance, to consider whether to 
authorize, prohibit, or allow to proceed without authorization 
each major information technology project. Each report shall 
include an estimate of acquisition costs, implementation costs, 
and life cycle costs (which may be inclusive of acquisition or 
implementation costs); an intended implementation schedule 
indicating significant milestones, when initial operating 
capability and full operating capability should be achieved, 
and when the project should be completed; and key business, 
functional, and performance objectives. Subsection (c) of 
section 2 applies this reporting requirement, within 90 days of 
enactment, to existing major information technology projects. 
As such projects are not ``new,'' the prohibition against 
obligating or extending funds does not apply. Otherwise, as 
described in paragraph (2) Report on Current Projects, the 
material to be reported is identical. After the Chief 
Information Officer's initial reporting on cost, schedule, and 
performance for each major information technology project, this 
information shall be used to establish a baseline against which 
changes or variances are to be measured during the life cycle 
of each project. This baseline information shall be contained 
in VA's annual budget justification materials, alongside the 
existing IT project-level information, and updated by the 
Secretary annually. A ``change'' is an impact to actual cost, 
schedule, or performance resulting from a change in 
requirements, such as a change order. A ``variance'' is an 
impact to actual cost, schedule, or performance (in the absence 
of a change in requirements) due to external factors. A 
``change'' connotes an intentional event. A ``variance'' 
connotes an unintentional event. Annual baseline updates 
include a compulsory element and a discretionary element: the 
budget justification materials must enumerate all changes or 
variances in cost, schedule, or performance regardless of 
magnitude during the previous fiscal year; the Secretary may 
also determine that a change, variance, or collection of 
changes or variances in the areas of cost, schedule, or 
performance objectives constitute a new baseline. Additionally, 
changes and variances of sufficient size occurring at any time 
must be reported, within 60 days after they occur, separately 
from the budget justification materials. The Chief Information 
Officer shall notify the appropriate congressional committees, 
and provide a description and explanation, for each change or 
variance ``with respect to the acquisition, implementation, or 
life cycle cost of the project, or development increment 
therein . . .'' that is 10 percent or greater compared to the 
baseline; ``with respect to the schedule for a development 
increment or for achieving a significant milestone, initial 
operating capability, or full operating capability, or for the 
final completion of the project . . .'' that is 180 days or 
greater compared to the baseline; and ``with respect to the 
performance, an instance where a key business, functional, or 
performance objective is not attained, or is not anticipated to 
be attained, in whole or in part.'' The term ``development 
increment'' is included to accommodate incremental software 
development and project management methodologies, such as 
agile. While VA must report initial baselines for entire 
projects, VA retains the ability to report changes and 
variances for individual development increments within 
projects. This is in recognition of the fact that cost 
estimates and schedules, and to a lesser extent performance 
objectives, may be somewhat speculative for major projects at 
their inceptions. Finally, section 8172 sets forth requirements 
for the leadership and composition of interdisciplinary project 
teams managing major information technology projects. Such 
teams must consist of an adequately qualified project manager, 
a functional lead, a technical lead, a contracting officer, and 
sufficient other project management, functional, technical, and 
procurement personnel as the Secretary determines appropriate. 
The project manager may be an employee of OIT or the 
organizational element in which the project originates (such as 
the Veterans Benefits Administration, Veterans Health 
Administration, National Cemetery Administration, a staff 
office, or others). The project manager must be certified at 
level three in project management by the Department, the 
Federal Acquisition Institute, the Department of Defense, or a 
private sector project management certification organization as 
determined appropriate by the Secretary. Certification by the 
Federal Acquisition Institute is conferred upon civilian 
Federal employees; this may be by the Institute directly, by 
the Department on behalf of the Institute, or by another 
civilian Federal agency, for which the employee previously 
worked, on behalf of the Institute. Certification by the 
Department of Defense is conferred upon members of the military 
or civilian Department of Defense employees by the Department 
of Defense under the Defense Acquisition Workforce Improvement 
Act (chapter 87 of title 10, United States Code). As relevant 
here, Department of Defense certification would have been 
conferred on VA employees while in the military or while 
previously working for the Department of Defense. An example of 
a private sector project management organization that the 
Secretary may determine appropriate is the Project Management 
Institute. The functional lead must be an employee of the 
organizational element of the Department at which the project 
originates. The functional lead is responsible for identifying 
functional requirements, such a business or non-technical 
requirements, and performance objectives. The technical lead 
must be an employee of OIT. The technical lead is responsible 
for identifying technical requirements and the execution of the 
same.
    Section 8173 concerns the IT activities of the VA Financial 
Services Center (FSC). The Committee understands that the FSC 
operates more than 80 IT systems. This section clarifies that, 
consistent with sections 11302 and 11319 of title 40, ``the 
Chief Information Officer of the Department shall exercise 
authority over the management, governance, and oversight 
processes relating to existing or proposed information 
technology of the Financial Services Center of the Department, 
or such successor office; and supervise the information 
technology employees and contractors of the Financial Services 
Center . . .'' This should already be happening but, in 
reality, is not, due in large part to the FSC's autonomy, in 
policy and in custom, derived from its self-financing status as 
a revolving fund entity. Additionally, this section stipulates 
that, ``the Director of the Financial Services Center of the 
Department, or the head of such successor office, may not enter 
into a contract or other agreement for information technology 
or information technology services unless the contract or other 
agreement has been reviewed and approved by the Chief 
Information Officer,'' and that, ``the Chief Information 
Officer shall have oversight and operational authority over all 
information security practices of the Financial Services Center 
of the Department.''
    Section 8174 requires the Secretary, acting through the 
Chief Information officer, to submit to the appropriate 
congressional committees each annual review of VA's IT 
portfolio conducted pursuant to section 11319(d)(3) of title 
40. The first annual review submitted shall include copies of 
each previous annual review. The Committee understands that VA 
has not conducted such IT portfolio reviews in each year since 
this requirement has been in statute.
    Section 8175 adds three new descriptive elements concerning 
IT to VA's annual budget justification materials. This 
section's purpose is to present a complete view of all 
individual projects, regardless of size, and to quantity the 
Department's IT needs beyond the fiscal year of the budget 
request. Subsection (a) requires a list of all IT projects in 
effect. It directs the Secretary to ``ensure that whenever the 
budget justification materials are submitted to Congress in 
support of the Department budget for a fiscal year (as 
submitted with the budget of the President for such fiscal year 
under section 1105(a) of title 31), such budget justification 
materials include a list of every information technology 
project currently in effect at the Department (including not 
only congressional projects and subprojects as determined by 
the Director of the Office of Management and Budget or the 
Secretary).'' This list should include similar descriptive 
information as is currently presented for the information 
technology projects listed in the budget justification 
materials. Subsection (a) of section 8175 works in concert with 
section 8172 to present all information technology projects 
regardless of size and major information technology projects, 
respectively. Subsection (b) requires a list of all unfunded IT 
projects for three fiscal years in the future. It directs the 
Secretary to ``ensure that the budget justification materials 
described in [this] subsection also include summary 
descriptions and a prioritized list, in rank order, of every 
information technology project of the Department, proposed or 
intended to be proposed for the following one, two, or three 
fiscal years, that is unfunded as of the time of the inclusion 
of the list under this paragraph.'' This is the first 
requirement for VA to rank IT projects. It is similar in 
concept, though different in mechanics, to the Department's 
longstanding Strategic Capital Investment Planning process and 
list. The stipulation that ranked projects be ``unfunded'' does 
not necessarily mean that such projects have been proposed and 
denied for funding or unable to obtain funding in the past, 
though this is possible. Rather, it supposes that such projects 
have not yet commenced. It is a list of all such projects that 
are in some stage of planning or proposal. The subsection 
directs the Secretary to ``ensure such list represents a 
ranking of all proposed information technology projects that 
reflects the needs of all elements of the Department''; it is 
not limited to projects or proposed projects originating in 
OIT. The subsection also directs the Secretary to ``produce one 
unified list for the entire Department demonstrating how the 
various proposed information technology projects of each of the 
elements of the Department rank in priority with the 
information technology projects of the other elements of the 
Department; and ensure that the list does not disaggregate and 
rank information technology projects based on element of the 
Department and does identify the element of the Department 
requesting the information technology project.'' In other 
words, VA shall not segregate lists or rank separately projects 
requested, funded by, or originating in OIT, the Veterans 
Benefits Administration, Veterans Health Administration, 
National Cemetery Administration, or other organizational 
elements of the Department; there shall be one list for the 
Department. The subsection lists the ranking factors to be 
used:
          (i) Degree of collaboration between business owners 
        and the Chief Information Officer with respect to joint 
        functional-technical planning, requirements, and 
        management.
          (ii) Operational or efficiency benefits to employees 
        of the Department created or produced by the 
        information technology project.
          (iii) The life cycle cost of the information 
        technology project.
          (iv) The cost savings or cost avoidance yielded by 
        the information technology project.
          (v) Time to completion of the information technology 
        project.
          (vi) The difficulty of the information technology 
        project, the likelihood the information technology 
        project will be completed, or the risks associated with 
        undertaking the information technology project.
          (vii) Tangible benefits to veterans created or 
        produced by the information technology project.
          (viii) Such other factors the Secretary considers 
        appropriate.
    The ranking factors are presented in no sequence or 
hierarchy; the Secretary may order or weight them as he 
determines best. Factor (i) is intended to incentivize better 
planning, requirements definition, and management in functional 
and technical areas between OIT and other organizational 
elements of the Department in order to acquire information 
technology that serves multiple organizational elements' needs, 
is more compatible, and makes more economical use of IT 
infrastructure. This is in contrast to OIT and other 
organizational elements planning, defining their requirements, 
and managing IT projects in isolation, creating waste and 
duplication. In factor (ii), operational or efficiency benefits 
to employees may be quantitative or qualitative. In factor 
(iii), lower life cycle costs are considered more favorable and 
should be ranked more highly. The Secretary may opt to define 
categories of magnitude so as to compare projects of similar 
magnitude and avoid comparing very large projects to very small 
projects, which would inevitably produce lower rankings for the 
larger projects. In factor (iv), cost savings and cost 
avoidance should be measured or quantified as the same manner 
used by the Department elsewhere, including in its internal 
programming or budgeting processes. In factor (v), lower time 
to completion is considered more favorable and should be ranked 
more highly. In factor (vi), a higher difficulty should be 
considered less favorable and ranked lower; a higher likelihood 
of completion should be considered more favorable and ranked 
more highly; a higher risk or risks should be considered less 
favorable and ranked lower. In factor (vii), tangible benefits 
to veterans may take various forms, as determined by the 
Secretary, but in all cases should be quantifiable. Subsection 
(c) requires the Secretary to project VA's IT funding needs 
one, two, and three fiscal years in the future. Such 
projections shall be disaggregated by portfolio and product or 
business line, which are the groupings and units of analysis 
already used by the Department in its budget justification 
materials as well as in reporting to OMB. The Secretary shall 
also present the projections of funding needs in terms of the 
categories of: infrastructure and equipment requirements (apart 
from software and services costs), development, operations and 
maintenance, and cybersecurity. These categories of are 
particular interest; they are not, however, all-encompassing of 
projected funding needs and would not necessarily add up to the 
total funding need projections disaggregated by portfolio and 
product or business line. The remainder of section 8175 is 
administrative. Subsection (b) inserts a new table index of the 
sections being added. Subsection (c) applies the new section 
8172 retroactively as previously discussed. Subsection (d) 
specifies that the effective date of the new budget 
justification material requirements is ``the first Monday in 
the second January beginning after the date of the enactment of 
this Act.'' The purpose of this subsection is to avoid applying 
these requirements to the budget request immediately following 
enactment.

Sec. 3. Report on Information Technology Dashboard Information

    Section 3 requires that not later than 90 days after 
enactment, the Secretary, acting through the Chief Information 
Officer, shall submit to the appropriate congressional 
committees a report containing an explanation of the ratings, 
rankings, and risk categorizations used by the Chief 
Information Officer in OMB's IT Dashboard, as well as copies or 
supporting or explanatory information provided by the Chief 
Information Officer to OMB but not publicly displaying on the 
IT Dashboard.

         Changes in Existing Law Made by the Bill, as Reported

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, and existing law in which no 
change is proposed is shown in roman):

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (new matter is 
printed in italics and existing law in which no change is 
proposed is shown in roman):

                      TITLE 38, UNITED STATES CODE



           *       *       *       *       *       *       *
PART VI--ACQUISITION AND DISPOSITION OF PROPERTY

           *       *       *       *       *       *       *


   CHAPTER 81--ACQUISITION AND OPERATION OF HOSPITAL AND DOMICILIARY 
    FACILITIES; PROCUREMENT AND SUPPLY; ENHANCED-USE LEASES OF REAL 
                                PROPERTY

      SUBCHAPTER I--ACQUISITION AND OPERATION OF MEDICAL FACILITIES

Sec.
8101. Definitions.
     * * * * * * *

      SUBCHAPTER VI--INFORMATION TECHNOLOGY PROJECTS AND ACTIVITIES

8171. Definitions.
8172. Management of major information technology projects.
8173. Information technology activities of the Financial Services 
          Center.
8174. Submission of annual reviews of information technology.
8175. Information technology matters to be included in budget 
          justification materials for the Department.

           *       *       *       *       *       *       *


     SUBCHAPTER VI--INFORMATION TECHNOLOGY PROJECTS AND ACTIVITIES

Sec. 8171. Definitions

  In this subchapter:
          (1) The term ``appropriate congressional committees'' 
        means--
                  (A) the Committee on Veterans' Affairs and 
                the Subcommittee on Military Construction, 
                Veterans Affairs and Related Agencies of the 
                Committee on Appropriations of the Senate; and
                  (B) the Committee on Veterans' Affairs and 
                the Subcommittee on Military Construction, 
                Veterans Affairs and Related Agencies of the 
                Committee on Appropriations of the House of 
                Representatives.
          (2) The term ``information technology'' has the 
        meaning given that term in section 11101 of title 40.
          (3) The term ``information technology project'' means 
        a project or program of the Department (including a 
        project or program of any element of the Department) 
        for, or including, the acquisition or implementation of 
        information technology. In cases where the Secretary 
        transmits to the Director of the Office of Management 
        and Budget information regarding information technology 
        investments, which may consist of individual or 
        multiple projects, such term refers to an individual 
        project or program or a grouping of multiple projects 
        or programs resulting in the acquisition or 
        implementation of discrete information technology.
          (4) The term ``life cycle costs'' means all direct 
        and indirect costs to acquire, implement, operate, and 
        maintain information technology, including with respect 
        to costs of any element of the Department.
          (5) The term ``major information technology project'' 
        means an information technology project if--
                  (A) the project is designated by the 
                Secretary, the Chief Information Officer of the 
                Department, or the Director of the Office of 
                Management and Budget as a major information 
                technology investment, as defined in section 
                11302 of title 40; or
                  (B) the dollar value of the project is 
                estimated by the Secretary to exceed 
                $500,000,000 (as adjusted for inflation 
                pursuant to section 1908 of title 41) for the 
                total life cycle costs of the project.
          (6) The term ``business owner'' means, with respect 
        to an information technology project, the program 
        manager, project manager, or other supervisory official 
        of the Department responsible for the project.

Sec. 8172. Management of major information technology projects

  (a) Cost, Schedule, and Performance Information.--(1) The 
Secretary may not obligate or expend funds for any major 
information technology project that begins after the date of 
the enactment of the Department of Veterans Affairs Information 
Technology Reform Act of 2021 unless the Secretary, acting 
through the Chief Information Officer of the Department, 
submits to the appropriate congressional committees a report 
containing information on the cost, schedule, and performance 
of such project, as generated by the business owner of the 
project.
  (2) Each report submitted under paragraph (1) for a project 
shall include, with respect to such project, the following:
          (A) An estimate of acquisition costs, implementation 
        costs, and life cycle costs.
          (B) An intended implementation schedule indicating 
        significant milestones, initial operating capability, 
        and full operating capability or completion.
          (C) Key business, functional, and performance 
        objectives.
  (b) Baseline.--(1) The Secretary shall use the information on 
the cost, schedule, and performance of a major information 
technology project included in the report under subsection (a) 
as the baseline against which changes or variances are measured 
during the life cycle of such project.
  (2) The Secretary shall--
          (A) annually update the baseline of a major 
        information technology project pursuant to subsection 
        (c); and
          (B) include such updated baseline in the documents 
        providing detailed information on the budget for the 
        Department that the Secretary submits to Congress in 
        conjunction with the President's budget submission 
        pursuant to section 1105 of title 31.
  (c) Changes and Variances.--(1) Not later than 60 days after 
the date on which the Secretary identifies a change or variance 
described in paragraph (2) in the cost, schedule, or 
performance of a major information technology project, the 
Secretary, acting through the Chief Information Officer, shall 
submit to the appropriate congressional committees a 
notification of such change or variance, including a 
description and explanation for such change or variance.
  (2) A change or variance in the cost, schedule, or 
performance of a major information technology project described 
in this paragraph is--
          (A) with respect to the acquisition, implementation, 
        or life cycle cost of the project, or development 
        increment therein, a change or variance that is 10 
        percent or greater compared to the baseline;
          (B) with respect to the schedule for a development 
        increment or for achieving a significant milestone, 
        initial operating capability, or full operating 
        capability, or for the final completion of the project, 
        a change or variance that is 180 days or greater 
        compared to the baseline; or
          (C) with respect to the performance, an instance 
        where a key business, functional, or performance 
        objective is not attained, or is not anticipated to be 
        attained, in whole or in part.
  (d) Management.--The Secretary shall ensure that each major 
information technology project is managed by an 
interdisciplinary team consisting of the following:
          (1) A project manager who is--
                  (A) certified in project management at level 
                three by the Department, the Federal 
                Acquisition Institute pursuant to section 1201 
                of title 41, or the Department of Defense 
                pursuant to section 1701a of title 10, or who 
                holds an equivalent certification by a private 
                sector project management certification 
                organization, as determined appropriate by the 
                Secretary; and
                  (B) an employee of the Office of Information 
                and Technology of the Department or an employee 
                of an element of the Department at which the 
                project originates.
          (2) A functional lead who is an employee of the 
        element of the Department at which the project 
        originates.
          (3) A technical lead who is an employee of the Office 
        of Information and Technology of the Department.
          (4) A contracting officer.
          (5) Sufficient other project management, functional, 
        technical, and procurement personnel as the Secretary 
        determines appropriate.

Sec. 8173. Information technology activities of the Financial Services 
                    Center

  (a) Management.--Consistent with sections 11302 and 11319 of 
title 40--
          (1) the Chief Information Officer of the Department 
        shall--
                  (A) exercise authority over the management, 
                governance, and oversight processes relating to 
                existing or proposed information technology of 
                the Financial Services Center of the 
                Department, or such successor office; and
                  (B) supervise the information technology 
                employees and contractors of the Financial 
                Services Center; and
          (2) the Director of the Financial Services Center of 
        the Department, or the head of such successor office, 
        may not enter into a contract or other agreement for 
        information technology or information technology 
        services unless the contract or other agreement has 
        been reviewed and approved by the Chief Information 
        Officer.
  (b) Oversight.--The Chief Information Officer shall have 
oversight and operational authority over all information 
security practices of the Financial Services Center of the 
Department.

Sec. 8174. Submission of annual reviews of information technology

  (a) In General.--The Secretary, acting through the Chief 
Information Officer of the Department, shall submit to the 
appropriate congressional committees each annual review of the 
information technology portfolio of the Department conducted 
pursuant to section 11319(d)(3) of title 40.
  (b) First Submission.--The first annual review submitted 
under subsection (a) shall include a copy of each previous 
annual review conducted under section 11319(d)(3) of title 40.

Sec. 8175. Information technology matters to be included in budget 
                    justification materials for the Department

  (a) List of Information Technology Projects in Effect.--The 
Secretary shall ensure that whenever the budget justification 
materials are submitted to Congress in support of the 
Department budget for a fiscal year (as submitted with the 
budget of the President for such fiscal year under section 
1105(a) of title 31), such budget justification materials 
include a list of every information technology project 
currently in effect at the Department (including not only 
congressional projects and subprojects as determined by the 
Director of the Office of Management and Budget or the 
Secretary).
  (b) Prioritized List of Unfunded Projects.--(1) In addition 
to the list included in the budget justification materials 
required by subsection (a), the Secretary shall ensure that the 
budget justification materials described in such subsection 
also include summary descriptions and a prioritized list, in 
rank order, of every information technology project of the 
Department, proposed or intended to be proposed for the 
following one, two, or three fiscal years, that is unfunded as 
of the time of the inclusion of the list under this paragraph.
  (2) In producing the list required by paragraph (1), the 
Secretary shall--
          (A) ensure such list represents a ranking of all 
        proposed information technology projects that reflects 
        the needs of all elements of the Department;
          (B) produce one unified list for the entire 
        Department demonstrating how the various proposed 
        information technology projects of each of the elements 
        of the Department rank in priority with the information 
        technology projects of the other elements of the 
        Department; and
          (C) ensure that the list--
                  (i) does not disaggregate and rank 
                information technology projects based on 
                element of the Department; and
                  (ii) does identify the element of the 
                Department requesting the information 
                technology project.
  (3)(A) In producing each list under paragraph (1), the 
Secretary shall prioritize and rank each information technology 
project based on an assessment of each of the following 
factors:
          (i) Degree of collaboration between business owners 
        and the Chief Information Officer with respect to joint 
        functional-technical planning, requirements, and 
        management.
          (ii) Operational or efficiency benefits to employees 
        of the Department created or produced by the 
        information technology project.
          (iii) The life cycle cost of the information 
        technology project.
          (iv) The cost savings or cost avoidance yielded by 
        the information technology project.
          (v) Time to completion of the information technology 
        project.
          (vi) The difficulty of the information technology 
        project, the likelihood the information technology 
        project will be completed, or the risks associated with 
        undertaking the information technology project.
          (vii) Tangible benefits to veterans created or 
        produced by the information technology project.
          (viii) Such other factors as the Secretary considers 
        appropriate.
  (B) The Secretary shall ensure that each list produced under 
paragraph (1) includes, for each information technology project 
included in the list, a brief description of the findings of 
the Secretary with respect to each assessment carried out by 
the Secretary for each factor for the information technology 
project under subparagraph (A).
  (c) Projected Funding Needs.--(1) In addition to the matters 
included under subsections (a) and (b), the Secretary shall 
ensure that the budget justification materials described in 
subsection (a) also include a projection of the one-year, two-
year, and three-year funding needs of the Department for 
information technology, disaggregated by portfolio and product 
line of the Department that requires the funding.
  (2) In addition to the projections under paragraph (1), the 
Secretary shall include a description of the following, with 
respect to each of the periods set forth in such paragraph, 
disaggregated by major business line of the Department:
          (A) The information technology infrastructure and 
        equipment requirements.
          (B) The funding required for development.
          (C) The funding required for operations and 
        maintenance.
          (D) The funding required by cybersecurity.
          (E) Such other categories of the information 
        technology needs of the Department as the Secretary 
        considers relevant and important.

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