Breach of critical cost growth threshold: reassessment of program; presumption of program termination

10 U.S.C. § 4376

• Title: 10 — Armed Forces
• Chapter: 325 — COST GROWTH—UNIT COST REPORTS (NUNN-MCCURDY)

Text

(a) Reassessment of Program.—If the program acquisition unit cost or procurement unit cost of a major defense acquisition program or designated subprogram (as determined by the Secretary under section 4374 of this title) increases by a percentage equal to or greater than the critical cost growth threshold for the program or subprogram, the Secretary of Defense shall—
(1) determine the root cause or causes of the critical cost growth in accordance with applicable statutory requirements and Department of Defense policies, procedures, and guidance; and
(2) in consultation with the Director of Cost Assessment and Program Evaluation, carry out an assessment of—
(A) the projected cost of completing the program if current requirements are not modified;
(B) the projected cost of completing the program based on reasonable modification of such requirements;
(C) the rough order of magnitude of the costs of any reasonable alternative system or capability; and
(D) the need to reduce funding for other programs due to the growth in cost of the program.
(b) Presumption of Termination.—
(1) Termination unless secretary submits certification and report.—After conducting the reassessment required by subsection (a) with respect to a major defense acquisition program, the Secretary shall terminate the program unless the Secretary submits to Congress, before the end of the 60-day period beginning on the day the Selected Acquisition Report containing the information described in section 4375(d) and (e) of this title is required to be submitted under section 4351(f) of this title, a written certification in accordance with paragraph (2).
(2) Certification.—A certification described by this paragraph with respect to a major defense acquisition program is a written certification that—
(A) the continuation of the program is essential to the national security;
(B) there are no alternatives to the program which will provide acceptable capability at less cost;
(C) the new estimates of the program acquisition unit cost or procurement unit cost have been determined by the Director of Cost Assessment and Program Evaluation to be reasonable;
(D) the program is a higher priority than programs whose funding must be reduced to accommodate the growth in cost of the program; and
(E) the management structure for the program is adequate to manage and control program acquisition unit cost or procurement unit cost.
(3) Report.—A written certification under paragraph (2) shall be accompanied by a report presenting the root cause analysis and assessment carried out pursuant to subsection (a) and the basis for each determination made in accordance with subparagraphs (A) through (E) of paragraph (2), together with supporting documentation.
(c) Actions if Program Terminated.—If a major defense acquisition program is terminated pursuant to subsection (b), the Secretary shall submit to Congress a written report setting forth—
(1) an explanation of the reasons for terminating the program;
(2) the alternatives considered to address any problems in the program; and
(3) the course the Department plans to pursue to meet any continuing military requirements otherwise intended to be met by the program.

History

(Added and amended Pub. L. 116–283, div. A, title XVIII, §1850(a), (j), Jan. 1, 2021, 134 Stat. 4265, 4269; Pub. L. 117–81, div. A, title XVII, §1701(o)(6)(E)(v), Dec. 27, 2021, 135 Stat. 2148; Pub. L. 119–60, div. A, title XVIII, §1811(g)(4), Dec. 18, 2025, 139 Stat. 1243.)

Editorial Notes

Editorial Notes

Codification
The text of subsecs. (a) and (b) of section 2433a of this title, which was transferred to this section by Pub. L. 116–283, §1850(j)(1), was based on Pub. L. 111–23, title II, §206(a)(1), May 22, 2009, 123 Stat. 1726; Pub. L. 111–383, div. A, title X, §1075(b)(35), Jan. 7, 2011, 124 Stat. 4371.
The text of subsec. (d) of section 2433a of this title, which was transferred to this section and redesignated subsec. (c) by Pub. L. 116–283, §1850(j)(2), was based on Pub. L. 111–23, title II, §206(a)(1), May 22, 2009, 123 Stat. 1726.

Amendments
2025—Subsec. (a). Pub. L. 119–60, §1811(g)(4)(A), struck out ", after consultation with the Joint Requirements Oversight Council regarding program requirements," after "Secretary of Defense" in introductory provisions.
Subsec. (b)(2)(B). Pub. L. 119–60, §1811(g)(4)(B), struck out "to meet the joint military requirement (as defined in section 181(g)(1) of this title)" after "capability".
Subsec. (c)(3). Pub. L. 119–60, §1811(g)(4)(C), struck out "joint" before "military requirements".
2021—Pub. L. 116–283, §1850(j)(1), (2), transferred subsecs. (a), (b), and (d) of section 2433a of this title to this section and redesignated subsec. (d) as (c).
Subsec. (a). Pub. L. 116–283, §1850(j)(3)(A), substituted "section 4374" for "section 2433(d)" in introductory provisions.
Subsec. (b)(1). Pub. L. 116–283, §1850(j)(4)(A), inserted heading.
Pub. L. 116–283, §1850(j)(3)(B), as amended by Pub. L. 117–81, §1701(o)(6)(E)(v), substituted "section 4375(d) and (e)" for "section 2433(g)" and "section 4351(f)" for "section 2432(f)".
Subsec. (b)(2), (3). Pub. L. 116–283, §1850(j)(4)(B)–(D), realigned margins and inserted headings.

Statutory Notes and Related Subsidiaries

Effective Date of 2021 Amendment
Amendment by Pub. L. 117–81 applicable as if included in the enactment of title XVIII of Pub. L. 116–283 as enacted, see section 1701(a)(2) of Pub. L. 117–81, set out in a note preceding section 3001 of this title and Effective Date note below.

Effective Date
Section and amendment by Pub. L. 116–283 effective Jan. 1, 2022, with additional provisions for delayed implementation and applicability of existing law, see section 1801(d) of Pub. L. 116–283, set out as an Effective Date of 2021 Amendment note preceding section 3001 of this title.