Authority to acquire consumption-based solutions

10 U.S.C. § 3605

• Title: 10 — Armed Forces
• Chapter: 253 — RAPID ACQUISITION PROCEDURES

Text

(a) Authority.—The Secretary of Defense and the Secretaries of the military departments may acquire services through consumption-based solutions.
(b) Guidance Required.—The Secretary of Defense shall amend the Department of Defense Supplement to the Federal Acquisition Regulation to implement the authority under subsection (a), including creating a new subcategory of services under part 237 of the Department of Defense Supplement to the Federal Acquisition Regulation, entitled "Consumption-based solutions", that—
(1) is any combination of hardware, equipment, software, labor, or services that together provides a seamless capability;
(2) has the ability to be metered and billed based on actual usage;
(3) has predetermined pricing at fixed-price units;
(4) requires the awardee to notify the Department of Defense contracting officer when consumption under the contract reaches 75 percent and 90 percent of the funded amount, respectively, of the contract; and
(5) treats modifications to a contract entered into under the authority established in subsection (a) to add new features or capabilities in an amount less than or equal to 25 percent of the total value of such contract, as originally awarded, as procurements made using competitive procedures for the purposes of chapter 221 of this title.
(c) Funding.—Amounts authorized to be appropriated for acquisitions using the authority under subsection (a)—
(1) may be used for expenses for—
(A) research, development, test and evaluation;
(B) procurement;
(C) production;
(D) modification; and
(E) operation and maintenance; and
(2) may be used to enter into incrementally funded contracts or other agreements, including advanced payments.
(d) Consumption-based Solution Defined.—In this section, the term "consumption-based solution" means a model under which a service is provided to the Department of Defense and may utilize any combination of software, hardware or equipment, data, and labor or services that provides a capability that is metered and billed based on actual usage at fixed-price units.
(e) Rule of Construction.—Nothing in this section shall be construed to prohibit the use of the authority created under this section in combination with another contract type provided for under the Department of Defense Supplement to the Federal Acquisition Regulation.

History

(Added Pub. L. 119–60, div. A, title XVIII, §1825, Dec. 18, 2025, 139 Stat. 1248.)

Editorial Notes

Statutory Notes and Related Subsidiaries

Pilot Program on the Use of Consumption-Based Solutions To Address Software-Intensive Warfighting Capability
Pub. L. 116–283, div. A, title VIII, §834, Jan. 1, 2021, 134 Stat. 3754, provided that:
"(a) In General.—Subject to the availability of appropriations, the Secretary of Defense is authorized to establish a pilot program to explore the use of consumption-based solutions to address software-intensive warfighting capability.
"(b) Selection of Initiatives.—Each Secretary of a military department and each commander of a combatant command with acquisition authority shall propose for selection by the Secretary of Defense for the pilot program at least one and not more than three initiatives that are well-suited to explore consumption-based solutions, to include addressing software-intensive warfighting capability. The initiatives may be new or existing programs of record, and may include applications that—
"(1) rapidly analyze sensor data;
"(2) secure warfighter networks, including multilevel security;
"(3) swiftly transport information across various networks and network modalities;
"(4) enable joint all-domain operational concepts, including in a contested environment; or
"(5) advance military capabilities and effectiveness.
"(c) Requirements.—A contract or other agreement for consumption-based solutions entered into under the pilot program shall require—
"(1) the effectiveness of the solution to be measurable at regular intervals customary for the type of solution provided under contract or other agreement; and
"(2) that the awardee notify the Secretary of Defense when consumption under the contract or other agreement reaches 75 percent and 90 percent of the funded amount, respectively, of the contract or other agreement.
"(d) Exemption.—A modification to a contract or other agreement entered into under this section to add new features or capabilities in an amount less than or equal to 25 percent of the total value of such contract or other agreement shall be exempt from the requirements of full and open competition (as defined in section 2302 of title 10, United States Code [see 10 U.S.C. 3011]).
"(e) Duration.—The duration of a contract or other agreement entered into under this section may not exceed three years.
"(f) Monitoring and Evaluation of Pilot Program.—The Director of Cost Assessment and Program Evaluation shall continuously monitor and evaluate the pilot program, including by collecting data on cost, schedule, and performance from the program office, the user community, and the awardees involved in the program.
"(g) Reports.—
"(1) Initial report.—Not later than May 15, 2021, the Secretary of Defense shall submit to the congressional defense committees [Committees on Armed Services and Appropriations of the Senate and the House of Representatives] a report on initiatives selected for the pilot program, roles, and responsibilities for implementing the program, and the monitoring and evaluation approach that will be used for the program.
"(2) Progress report.—Not later than October 15, 2021, the Secretary of Defense shall submit to the congressional defense committees a report on the progress of the initiatives selected for the pilot program.
"(3) Final report.—Not later than 3 years after the date of the enactment of this Act [Jan. 1, 2021], the Secretary of Defense shall submit to the congressional defense committees a report on the cost, schedule, and performance outcomes of the initiatives carried out under the pilot program. The report shall also include lessons learned about the use of consumption-based solutions for software-intensive capabilities and any recommendations for statutory or regulatory changes to facilitate the use of such solutions.
"(h) Consumption-based Solution Defined.—In this section, the term 'consumption-based solution' means any combination of software, hardware or equipment, and labor or services that provides a seamless capability that is metered and billed based on actual usage and predetermined pricing per resource unit, and includes the ability to rapidly scale capacity up or down."

Editorial Notes

Amendments
2018—Pub. L. 115–232, div. A, title VIII, §801(a), Aug. 13, 2018, 132 Stat. 1828, added chapter heading.

Statutory Notes and Related Subsidiaries

Defense Procurements Made Through Contracts of Other Agencies
Pub. L. 108–375, div. A, title VIII, §854, Oct. 28, 2004, 118 Stat. 2022, provided that:
"(a) Limitation.—The head of an agency may not procure goods or services (under section 1535 of title 31, United States Code, pursuant to a designation under section 11302(e) of title 40, United States Code, or otherwise) through a contract entered into by an agency outside the Department of Defense for an amount greater than the simplified acquisition threshold referred to in section 2304(g) of title 10, United States Code [now 10 U.S.C. 3205], unless the procurement is done in accordance with procedures prescribed by that head of an agency for reviewing and approving the use of such contracts.
"(b) Effective Date.—The limitation in subsection (a) shall apply only with respect to orders for goods or services that are issued by the head of an agency to an agency outside the Department of Defense on or after the date that is 180 days after the date of the enactment of this Act [Oct. 28, 2004].
"(c) Inapplicability to Contracts for Certain Services.—This section does not apply to procurements of the following services:
"(1) Printing, binding, or blank-book work to which section 502 of title 44, United States Code, applies.
"(2) Services available under programs pursuant to section 103 of the Library of Congress Fiscal Operations Improvement Act of 2000 (Public Law 106–481; 114 Stat. 2187; 2 U.S.C. 182c).
"(d) Annual Report.—(1) For each of fiscal years 2005 and 2006, each head of an agency shall submit to the Secretary of Defense a report on the service charges imposed on purchases made for an amount greater than the simplified acquisition threshold during such fiscal year through a contract entered into by an agency outside the Department of Defense.
"(2) In the case of procurements made on orders issued by the head of a Defense Agency, Department of Defense Field Activity, or any other organization within the Department of Defense (other than a military department) under the authority of the Secretary of Defense as the head of an agency, the report under paragraph (1) shall be submitted by the head of that Defense Agency, Department of Defense Field Activity, or other organization, respectively.
"(3) The report for a fiscal year under this subsection shall be submitted not later than December 31 of the calendar year in which such fiscal year ends.
"(e) Definitions.—In this section:
"(1) The term 'head of an agency' means the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, the Secretary of the Air Force.
"(2) The term 'Defense Agency' has the meaning given such term in section 101(a)(11) of title 10, United States Code.
"(3) The term 'Department of Defense Field Activity' has the meaning given such term in section 101(a)(12) of such title."

Procurement of Alternative Fueled and Hybrid Light Duty Trucks
Pub. L. 107–107, div. A, title III, §318, Dec. 28, 2001, 115 Stat. 1055, provided that:
"(a) Defense Fleets Not Covered by Requirement in Energy Policy Act of 1992.—(1) The Secretary of Defense shall coordinate with the Administrator of General Services to ensure that only hybrid vehicles are procured by the Administrator for the Department of Defense fleet of light duty trucks that is not in a fleet of vehicles to which section 303 of the Energy Policy Act of 1992 (42 U.S.C. 13212) applies.
"(2) The Secretary, in consultation with the Administrator, may waive the policy regarding the procurement of hybrid vehicles in paragraph (1) to the extent that the Secretary determines necessary—
"(A) in the case of trucks that are exempt from the requirements of section 303 of the Energy Policy Act of 1992 for national security reasons under subsection (b)(3)(E) of such section, to meet specific requirements of the Department of Defense for capabilities of light duty trucks;
"(B) to procure vehicles consistent with the standards applicable to the procurement of fleet vehicles for the Federal Government; or
"(C) to adjust to limitations on the commercial availability of light duty trucks that are hybrid vehicles.
"(3) This subsection applies with respect to procurements of light duty trucks in fiscal year 2005 and subsequent fiscal years.
"(b) Requirement To Exceed Requirement in Energy Policy Act of 1992.—(1) The Secretary of Defense shall coordinate with the Administrator of General Services to ensure that, of the light duty trucks procured in fiscal years after fiscal year 2004 for the fleets of light duty vehicles of the Department of Defense to which section 303 of the Energy Policy Act of 1992 [42 U.S.C. 13212] applies—
"(A) five percent of the total number of such trucks that are procured in each of fiscal years 2005 and 2006 are alternative fueled vehicles or hybrid vehicles; and
"(B) ten percent of the total number of such trucks that are procured in each fiscal year after fiscal year 2006 are alternative fueled vehicles or hybrid vehicles.
"(2) Light duty trucks acquired for the Department of Defense that are counted to comply with section 303 of the Energy Policy Act of 1992 for a fiscal year shall be counted to determine the total number of light duty trucks procured for the Department of Defense for that fiscal year for the purposes of paragraph (1), but shall not be counted to satisfy the requirement in that paragraph.
"(c) Report on Plans for Implementation.—At the same time that the President submits the budget for fiscal year 2003 to Congress under section 1105(a) of title 31, United States Code, the Secretary shall submit to Congress a report summarizing the plans for carrying out subsections (a) and (b).
"(d) Definitions.—In this section:
"(1) The term 'hybrid vehicle' means a motor vehicle that draws propulsion energy from onboard sources of stored energy that are both—
"(A) an internal combustion or heat engine using combustible fuel; and
"(B) a rechargeable energy storage system.
"(2) The term 'alternative fueled vehicle' has the meaning given that term in section 301 of the Energy Policy Act of 1992 (42 U.S.C. 13211)."