HR 2722 - Integrated Deepwater Program Reform Act

HR 2722
7-31-07, Bill Passed House 426-0
Referred to Senate Committee on Commerce, Science & Transportation

110th CONGRESS
1st Session

H. R. 2722

IN THE SENATE OF THE UNITED STATES

August 1, 2007

Received

August 3, 2007

Read twice and referred to the Committee on Commerce, Science, and Transportation

AN ACT

To restructure the Coast Guard Integrated Deepwater Program, and for other purposes.

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

SECTION 1. SHORT TITLE.

This Act may be cited as the `Integrated Deepwater Program Reform Act'.

SEC. 2. IMPLEMENTATION OF COAST GUARD INTEGRATED DEEPWATER ACQUISITION PROGRAM.

(a) Use of Private Sector Entity as a Lead Systems Integrator-

(1) IN GENERAL- Except as otherwise provided in this subsection, the Secretary may not use a private sector entity as a lead systems integrator for procurements under, or in support of, the Deepwater Program beginning on the earlier of October 1, 2011, or the date on which the Secretary certifies in writing to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate that the Coast Guard has available and can retain sufficient contracting personnel and expertise within the Coast Guard, through an arrangement with other Federal agencies, or through contracts or other arrangements with private sector entities, to perform the functions and responsibilities of the lead system integrator in an efficient and cost-effective manner.

(2) COMPLETION OF EXISTING DELIVERY ORDERS AND TASK ORDERS- The Secretary may use a private sector entity as a lead systems integrator to complete any delivery order or task order under the Deepwater Program that was issued to the lead systems integrator on or before the date of enactment of this Act.

(3) ASSISTANCE OF OTHER FEDERAL AGENCIES- In any case in which the Secretary is the systems integrator under the Deepwater Program, the Secretary may obtain any type of assistance the Secretary considers appropriate, with any systems integration functions, from any Federal agency with experience in systems integration involving maritime vessels and aircraft.

(4) ASSISTANCE OF PRIVATE SECTOR ENTITIES- In any case in which the Secretary is the systems integrator under the Deepwater Program, the Secretary may, subject to the availability of appropriations, obtain by grant, contract, or cooperative agreement any type of assistance the Secretary considers appropriate, with any systems integration functions, from any private sector entity with experience in systems integration involving maritime vessels and aircraft.

(b) Competition-

(1) IN GENERAL- Except as otherwise provided in this subsection, the Secretary shall use full and open competition for each class of asset acquisitions under the Deepwater Program for which an outside contractor is used, if the asset is procured directly by the Coast Guard or by the Integrated Coast Guard System acting under a contract with the Coast Guard.

(2) EXCEPTION- The Secretary may use a procurement method that is less than full and open competition to procure an asset under the Deepwater Program, if--

(A) the Secretary determines that such method is in the best interests of the Federal Government; and

(B) by not later than 30 days before the date of the award of a contract for the procurement, the Secretary submits to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate a report explaining why such procurement is in the best interests of the Federal Government.

(3) LIMITATION ON APPLICATION- Paragraph (1) shall not apply to a contract, subcontract, or task order that was issued before the date of enactment of this Act, if there is no change in the quantity of assets or the specific type of assets procured.

(c) Required Contract Terms- The Secretary shall include in each contract, subcontract, and task order issued under the Deepwater Program after the date of the enactment of this Act the following provisions, as applicable:

(1) TECHNICAL REVIEWS- A requirement that the Secretary shall conduct a technical review of all proposed designs, design changes, and engineering changes, and a requirement that the contractor must specifically address all engineering concerns identified in the technical reviews, before any funds may be obligated.

(2) RESPONSIBILITY FOR TECHNICAL REQUIREMENTS- A requirement that the Secretary shall maintain the authority to establish, approve, and maintain technical requirements.

(3) COST ESTIMATE OF MAJOR CHANGES- A requirement that an independent cost estimate must be prepared and approved by the Secretary before the execution of any change order costing more than 5 percent of the unit cost approved in the Deepwater Program baseline in effect as of May 2007.

(4) PERFORMANCE MEASUREMENT- A requirement that any measurement of contractor and subcontractor performance must be based on the status of all work performed, including the extent to which the work performed met all cost, schedule, and mission performance requirements outlined in the Deepwater Program contract.

(5) EARLY OPERATIONAL ASSESSMENT- For the acquisition of any cutter class for which an Early Operational Assessment has not been developed--

(A) a requirement that the Secretary of the Department in which the Coast Guard is operating shall cause an Early Operational Assessment to be conducted by the Department of the Navy after the development of the preliminary design of the cutter and before the conduct of the critical design review of the cutter; and

(B) a requirement that the Coast Guard shall develop a plan to address the findings presented in the Early Operational Assessment.

(6) TRANSIENT ELECTROMAGNETIC PULSE EMANATION- For the acquisition or upgrade of air, surface, or shore assets for which compliance with transient electromagnetic pulse emanation (TEMPEST) is a requirement, a provision specifying that the standard for determining such compliance shall be the air, surface, or shore asset standard then used by the Department of the Navy.

(7) OFFSHORE PATROL CUTTER UNDERWAY REQUIREMENT- For any contract issued to acquire an Offshore Patrol Cutter, provisions specifying the service life, fatigue life, days underway in general Atlantic and North Pacific Sea conditions, maximum range, and maximum speed the cutter shall be built to achieve.

(8) INSPECTOR GENERAL ACCESS- A requirement that the Department of Homeland Security's Office of the Inspector General shall have access to all records maintained by all contractors working on the Deepwater Program, and shall have the right to privately interview any contractor personnel.

(d) Life Cycle Cost Estimate-

(1) IN GENERAL- The Secretary shall develop an authoritative life cycle cost estimate for the Deepwater Program.

(2) CONTENTS- The life cycle cost estimate shall include asset acquisition and logistics support decisions and planned operational tempo and locations as of the date of enactment of this Act.

(3) SUBMITTAL- The Secretary shall--

(A) submit the life cycle cost estimate to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate within 4 months after the date of enactment of this Act; and

(B) submit updates of the life cycle cost estimate to such Committees annually.

(e) Contract Officers- The Secretary shall assign a separate contract officer for each class of cutter and aircraft acquired or rehabilitated under the Deepwater Program, including the National Security Cutter, the Offshore Patrol Cutter, the Fast Response Cutter A, the Fast Response Cutter B, maritime patrol aircraft, the aircraft HC-130J, the helicopter HH-65, the helicopter HH-60, and the vertical unmanned aerial vehicle.

(f) Technology Risk Report- The Secretary shall submit to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate a report identifying the technology risks and level of maturity for major technologies used on each class of asset acquisitions under the Deepwater Program, including the Fast Response Cutter A (FRC-A), the Fast Response Cutter B (FRC-B), the Offshore Patrol Cutter (OPC), and the Vertical Unmanned Aerial Vehicle (VUAV), not later than 90 days before the date of award of a contract for such an acquisition.

(g) Submission of Assessment Results and Plans to Congress- The Commandant of the Coast Guard shall submit to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate--

(1) the results of each Early Operational Assessment conducted pursuant to subsection (c)(5)(A) and the plan approved by the Commandant pursuant to subsection (c)(5)(B) for addressing the findings of such assessment, within 30 days after the Commandant approves the plan; and

(2) a report describing how the recommendations of each Early Operational Assessment conducted pursuant to subsection (c)(5)(A) on the first in class of a new cutter class have been addressed in the design on which construction is to begin, within 30 days before initiation of construction.

SEC. 3. CHIEF ACQUISITION OFFICER.

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

`Sec. 55. Chief Acquisition Officer

`(a) Establishment of Agency Chief Acquisition Officer- The Commandant shall appoint or designate a career reserved employee as Chief Acquisition Officer for the Coast Guard, who shall--

`(1) have acquisition management as that official's primary duty; and

`(2) report directly to the Commandant to advise and assist the Commandant to ensure that the mission of the Coast Guard is achieved through the management of the Coast Guard's acquisition activities.

`(b) Authority and Functions of the Chief Acquisition Officer- The functions of the Chief Acquisition Officer shall include--

`(1) monitoring the performance of acquisition activities and acquisition programs of the Coast Guard, evaluating the performance of those programs on the basis of applicable performance measurements, and advising the Commandant regarding the appropriate business strategy to achieve the mission of the Coast Guard;

`(2) increasing the use of full and open competition in the acquisition of property and services by the Coast Guard by establishing policies, procedures, and practices that ensure that the Coast Guard receives a sufficient number of sealed bids or competitive proposals from responsible sources to fulfill the Government's requirements (including performance and delivery schedules) at the lowest cost or best value considering the nature of the property or service procured;

`(3) ensuring the use of detailed performance specifications in instances in which performance-based contracting is used;

`(4) making acquisition decisions consistent with all applicable laws and establishing clear lines of authority, accountability, and responsibility for acquisition decisionmaking within the Coast Guard;

`(5) managing the direction of acquisition policy for the Coast Guard, including implementation of the unique acquisition policies, regulations, and standards of the Coast Guard;

`(6) developing and maintaining an acquisition career management program in the Coast Guard to ensure that there is an adequate professional workforce; and

`(7) as part of the strategic planning and performance evaluation process required under section 306 of title 5 and sections 1105(a)(28), 1115, 1116, and 9703 of title 31--

`(A) assessing the requirements established for Coast Guard personnel regarding knowledge and skill in acquisition resources management and the adequacy of such requirements for facilitating the achievement of the performance goals established for acquisition management;

`(B) in order to rectify any deficiency in meeting such requirements, developing strategies and specific plans for hiring, training, and professional development; and

`(C) reporting to the Commandant on the progress made in improving acquisition management capability.'.

(b) Clerical Amendment- The table of sections at the beginning of such chapter is amended by adding at the end the following:

`55. Chief Acquisition Officer.'.

(1) REQUIREMENT TO ESTABLISH- Not later than 1 year after the date of enactment of this Act and in accordance with part 9701.333 of title 5, Code of Federal Regulations, the Commandant of the Coast Guard shall establish special rate supplements that provide higher pay levels for employees necessary to carry out the amendment made by this section.

(2) SUBJECT TO APPROPRIATIONS- The requirement under paragraph (1) is subject to the availability of appropriations.

SEC. 4. TESTING AND CERTIFICATION.

(a) In General- The Secretary shall--

(1) cause each cutter, other than a National Security Cutter, acquired by the Coast Guard and delivered after the date of enactment of this Act to be classed by the American Bureau of Shipping, before acceptance of delivery;

(2) cause the design and construction of each National Security Cutter, other than National Security Cutter 1 and 2, to be certified by an independent third party with expertise in vessel design and construction certification to be able to meet a 185-underway-day requirement under general Atlantic and North Pacific sea conditions for a period of at least 30 years;

(3) cause all electronics on all aircraft, surface, and shore assets that require TEMPEST certification and that are delivered after the date of enactment of this Act to be tested and certified in accordance with TEMPEST standards and communications security (COMSEC) standards by an independent third party that is authorized by the Federal Government to perform such testing and certification; and

(4) cause all aircraft and aircraft engines acquired by the Coast Guard and delivered after the date of enactment of this Act to be certified for airworthiness by an independent third party with expertise in aircraft and aircraft engine certification, before acceptance of delivery.

(b) First in Class of a Major Asset Acquisition- The Secretary shall cause the first in class of a major asset acquisition of a cutter or an aircraft to be subjected to an assessment of operational capability conducted by the Secretary of the Navy.

(c) Final Arbiter- The Secretary shall be the final arbiter of all technical disputes regarding designs and acquisitions of vessels and aircraft for the Coast Guard.

SEC. 5. NATIONAL SECURITY CUTTERS.

(a) National Security Cutters 1 and 2-

(1) REPORT ON OPTIONS UNDER CONSIDERATION- The Secretary shall submit to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate--

(A) within 120 days after the date of enactment of this Act, a report describing in detail the cost increases that have been experienced on National Security Cutters 1 and 2 since the date of the issuance of the task orders for construction of those cutters and explaining the causes of these cost increases; and

(B) within 180 days after the date of enactment of this Act, a report on the options that the Coast Guard is considering to strengthen the hulls of National Security Cutter 1 and National Security Cutter 2, including--

(i) the costs of each of the options under consideration;

(ii) a schedule for when the hull strengthening repairs are anticipated to be performed; and

(iii) the impact that the weight likely to be added to each the cutter by each option will have on the cutter's ability to meet both the original performance requirements included in the Deepwater Program contract and the performance requirements created by contract Amendment Modification 00042 dated February 7, 2007.

(2) DESIGN ASSESSMENT- Not later than 30 days before the Coast Guard signs any contract, delivery order, or task order to strengthen the hull of either of National Security Cutter 1 or 2 to resolve the structural design and performance issues identified in the Department of Homeland Security Inspector General's report OIG-07-23 dated January 2007, the Secretary shall submit to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate all results of an assessment of the proposed hull strengthening design conducted by the Naval Surface Warfare Center, Carderock Division, including a description in detail of the extent to which the hull strengthening measures to be implemented on those cutters will enable the cutters to meet a 185-underway-day requirement under general Atlantic and North Pacific sea conditions for a period of at least 30 years.

(b) National Security Cutters 3 Through 8- Not later than 30 days before the Coast Guard signs any contract, delivery order, or task order authorizing construction of National Security Cutters 3 through 8, the Secretary shall submit to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate all results of an assessment of the proposed designs to resolve the structural design, safety, and performance issues identified by the Department of Homeland Security Office of Inspector General report OIG-07-23 for the hulls of those cutters conducted by the Naval Surface Warfare Center, Carderock Division, including a description in detail of the extent to which such designs will enable the cutters to meet a 185-underway-day requirement under general Atlantic and North Pacific sea conditions.

SEC. 6. MISCELLANEOUS REPORTS.

(a) In General- The Secretary shall submit the following reports to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate:

(1) Within 4 months after the date of enactment of this Act, a justification for why 8 National Security Cutters are required to meet the operational needs of the Coast Guard, including--

(A) how many days per year each National Security Cutter will be underway at sea;

(B) where each National Security Cutter will be home ported;

(D) the extent to which 8 National Security Cutters deployed without vertical unmanned aerial vehicles (VUAV) will meet or exceed the mission capability (including surveillance capacity) of the 12 Hamilton-class high endurance cutters that the National Security Cutters will replace;

(E) the business case in support of constructing National Security Cutters 3 through 8, including a cost-benefit analysis; and

(F) an analysis of how many Offshore Patrol Cutters would be required to provide the patrol coverage provided by a National Security Cutter.

(2) Within 4 months after the date of enactment of this Act, a report on--

(A) the impact that deployment of a National Security Cutter and other cutter assets without the vertical unmanned aerial vehicle (VUAV) will have on the amount of patrol coverage that will be able to be provided during missions conducted by the National Security Cutter and all other cutters planned to be equipped with a VUAV;

(B) how the coverage gap will be made up;

(D) the timeline detailing the major milestones to be achieved during development of the VUAV and identifying the delivery date for the first and last VUAV.

(3) Within 30 days after the elevation to flag-level for resolution of any design or other dispute regarding the Deepwater Program contract or an item to be procured under that contract, including a detailed description of the issue and the rationale underlying the decision taken by the flag officer to resolve the issue.

(4) Within 4 months after the date of enactment of this Act, a report detailing the total number of change orders that have been created by the Coast Guard under the Deepwater Program before the date of enactment of this Act, the total cost of these change orders, and their impact on the Deepwater Program schedule.

(5) Within 180 days after the date of enactment of this Act, a report detailing the technology risks and level of maturity for major technologies used on maritime patrol aircraft, the HC-130J, and the National Security Cutter.

(6) Not less than 60 days before signing a contract to acquire any vessel or aircraft, a report comparing the cost of purchasing that vessel or aircraft directly from the manufacturer or shipyard with the cost of procuring it through the Integrated Coast Guard System.

(7) Within 30 days after the Program Executive Officer of the Deepwater Program becomes aware of a likely cost overrun exceeding 5 percent of the overall asset acquisition contract cost or schedule delay exceeding 5 percent of the estimated asset construction period under the Deepwater Program, a report by the Commandant containing a description of the cost overrun or delay, an explanation of the overrun or delay, a description of Coast Guard's response, and a description of significant delays in the procurement schedule likely to be caused by the overrun or delay.

(8) Within 90 days after the date of enactment of this Act, articulation of a doctrine and description of an anticipated implementation of a plan for management of acquisitions programs, financial management (including earned value management and cost estimating), engineering and logistics management, and contract management, that includes--

(A) a description of how the Coast Guard will cultivate among uniformed personnel expertise in acquisitions management and financial management;

(B) a description of the processes that will be followed to draft and ensure technical review of procurement packages, including statements of work, for any class of assets acquired by the Coast Guard;

(C) a description of how the Coast Guard will conduct an independent cost estimating process, including independently developing cost estimates for major change orders; and

(D) a description of how Coast Guard will strengthen the management of change orders.

(9) Within 4 months after the date of enactment of this Act, a report on the development of a new acquisitions office within the Coast Guard describing the specific staffing structure for that directorate, including--

(A) identification of all managerial positions proposed as part of the office, the functions that each managerial position will fill, and the number of employees each manager will supervise; and

(B) a formal organizational chart and identification of when managerial positions are to be filled.

(10) Ninety days prior to the issuance of a Request for Proposals for construction of an Offshore Patrol Cutter, a report detailing the service life, fatigue life, maximum range, maximum speed, and number of days underway under general Atlantic and North Pacific Sea conditions the cutter shall be built to achieve.

(11) The Secretary shall report annually on the percentage of the total amount of funds expended on procurements under the Deepwater Program that has been paid to each of small businesses and minority-owned businesses.

(12) Within 120 days after the date of enactment of this Act, a report on any Coast Guard mission performance gap due to the removal of Deepwater Program assets from service. The report shall include the following:

(A) A description of the mission performance gap detailing the geographic regions and Coast Guard capabilities affected.

(B) An analysis of factors affecting the mission performance gap that are unrelated to the Deepwater Program, including deployment of Coast Guard assets overseas and continuous vessel shortages.

(C) A description of measures being taken in the near term to fill the mission performance gap, including what those measures are and when they will be implemented.

(D) A description of measures being taken in the long term to fill the mission performance gap, including what those measures are and when they will be implemented.

(E) A description of the potential alternatives to fill the mission performance gap, including any acquisition or lease considered and the reasons they were not pursued.

(b) Report Required on Acceptance of Delivery of Incomplete Asset-

(1) IN GENERAL- If the Secretary accepts delivery of an asset after the date of enactment of this Act for which a contractually required certification cannot be achieved within 30 days after the date of delivery or with any system that is not fully functional for the mission for which it was intended, the Secretary shall submit to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the United States Senate within 30 days after accepting delivery of the asset a report explaining why acceptance of the asset in such a condition is in the best interests of the United States Government.

(2) CONTENTS- The report shall--

(A) specify the systems that are not able to achieve contractually required certifications within 30 days after the date of delivery and the systems that are not fully functional at the time of delivery for the missions for which they were intended;

(B) identify milestones for the completion of required certifications and to make all systems fully functional; and

SEC. 7. USE OF THE NAVAL SEA SYSTEMS COMMAND, THE NAVAL AIR SYSTEMS COMMAND, AND THE SPACE AND NAVAL WARFARE SYSTEMS COMMAND TO ASSIST THE COAST GUARD IN EXERCISING TECHNICAL AUTHORITY FOR THE DEEPWATER PROGRAM AND OTHER COAST GUARD ACQUISITION PROGRAMS.

(a) Findings- Congress finds that the Coast Guard's use of the technical, contractual, and program management oversight expertise of the Department of the Navy in ship and aircraft production complements and augments the Coast Guard's organic expertise as it procures assets for the Deepwater Program.

(b) Inter-Service Technical Assistance- The Secretary may enter into a memorandum of understanding or a memorandum of agreement with the Secretary of the Navy to provide for the use of the Navy Systems Commands to assist the Coast Guard with the oversight of Coast Guard major acquisition programs. Such memorandum of understanding or memorandum of agreement shall, at a minimum provide for--

(1) the exchange of technical assistance and support that the Coast Guard Chief Engineer and the Coast Guard Chief Information Officer, as Coast Guard Technical Authorities, may identify;

(2) the use, as appropriate, of Navy technical expertise; and

(3) the temporary assignment or exchange of personnel between the Coast Guard and the Navy Systems Commands to facilitate the development of organic capabilities in the Coast Guard.

(c) Technical Authorities- The Coast Guard Chief Engineer, Chief Information Officer, and Chief Acquisition Officer shall adopt, to the extent practicable, procedures that are similar to those used by the Navy Senior Acquisition Official to ensure the Coast Guard Technical Authorities, or designated Technical Warrant Holders, approve all technical requirements.

(d) Coordination- The Secretary, acting through the Commandant of the Coast Guard, may coordinate with the Secretary of the Navy, acting through the Chief of Naval Operations, to develop processes by which the assistance will be requested from the Navy Systems Commands and provided to the Coast Guard.

(e) Report- Not later than 120 days after the date of enactment of this Act and every twelve months thereafter, the Commandant of the Coast Guard shall report to the Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate on the activities undertaken pursuant to such memorandum of understanding or memorandum of agreement.

SEC. 8. DEFINITIONS.

In this Act:

(1) DEEPWATER PROGRAM- The term `Deepwater Program' means the Integrated Deepwater Systems Program described by the Coast Guard in its report to Congress entitled `Revised Deepwater Implementation Plan 2005', dated March 25, 2005. The Deepwater Program primarily involves the procurement of cutter and aviation assets that operate more than 50 miles offshore.

(2) SECRETARY- The term `Secretary' means the Secretary of the department in which the Coast Guard is operating.

Passed the House of Representatives July 31, 2007.

Attest:

LORRAINE C. MILLER,

Clerk.

END