Nunn mccurdy breaches in major defense acquisition programs. A nunn mccurdy breach occurs when a program s unit cost exceeds certain thresholds. The sasc, in its markup for the 2017 defense policy bill, cited a cost growth of 186 percent for program acquisition unit cost over the original baseline estimate. Correspondence issued by the government accountability office with an abstract that begins for nearly 30 years, the statutory provision, known as nunnmccurdy, has been an oversight tool for congress to hold the department of defense dod accountable for cost growth on major defense programs. One is an analysis of the nunn mccurdy breach that occurred in the joint precision approach and landing system increment1a jpals inc. Accelerating dod systems fielding while avoiding a new. Trends in nunnmccurdy cost breaches for major defense. The purpose of the act is to help control cost growth in major defense systems by holding the appropriate pentagon officials and defense contractors. Ppt apb, sar, and nunnmccurdy status powerpoint presentation free to view id.
The program has already experienced one nunn mccurdy act breach in 2010. Mccurdy breach the selected sample includes 27 of the 41 programs since 1997 that had a nunn. Download for offline reading, highlight, bookmark or take notes while you read trends in nunn mccurdy cost breaches for major defense acquisition programs. A nunnmccurdy breach occurs when a programs unit cost exceeds certain thresholds. This thursday insider daily digest has news on the small diameter bomb ii program suffering a nunn mccurdy cost breach, the air forces nc3 modernization efforts and more the air forces small diameter bomb ii program has suffered a nunn mccurdy cost breach. Nunnmccurdy breach breaking defense defense industry. The nunnmccurdy provision applies to weapons programs and. We previously discussed nunnmccurdy limits in this article. The program then suffered a nunn mccurdy breach in 2002, when costs rose steeply on the first ship of the class, and there were some questions as to whether the program. Trends in nunn mccurdy cost breaches for major defense acquisition programs dear mr. A program whose cost growth exceeds the statutory thresholds is said to have a nunnmccurdy breach. When that happens, dod must notify congress of the breach. Although 25 of these programs experienced unitcostgrowth of over 50% relative to their original baseline, the dod did not report programs as having incurred a nunn mccurdy breach because the national defense authorization act permitted the original baseline estimate to be revised to the current baseline estimate as. The spacebased infrared system sbirs is a consolidated system intended to meet the united states infrared space surveillance needs through the first two to three decades of the 21st century.
However, the navy is reporting the breach for transparency purposes. The apache block 3 program is on the list because the department added new aircraft to a program that was refurbishing existing aircraft. This new process has merit, as our analysis shows that nearly 40 percent of nunnmccurdy breaches occurred after a production decision had been madewhen a program has fewer options for restructuring. Correspondence issued by the government accountability office with an abstract that begins for nearly 30 years, the statutory provision, known as nunn mccurdy, has been an oversight tool for congress to hold the department of defense dod accountable for cost growth on major defense programs. Programs with multiple breaches did share some common characteristics. A nunn mccurdy breach occurs when a programs unit cost exceeds certain thresholds. Trends in nunn mccurdy cost breaches for major defense acquisition programs ebook written by michael j. None of the programs on the nunn mccurdy list are surprises to department officials or to congress, the official said. Marines wont cut planned f35 buy totals for now, but. The nunn mccurdy provision set forth in the national defense authorization act for fy 1982 is designed to address unwarranted cost escalation in defense acquisition programs by requiring formal notification to congress of cost growth above designated thresholds. Background, analysis, and issues for congress kindle edition by moshe schwartz. Example programs include the warfighter information network tactical wint, advanced anti.
Gao11295r march 9, 2011 for nearly 30 years, the statutory provision, known as nunn mccurdy, has been an oversight tool for congress to hold the department of defense dod accountable for cost growth on major defense programs. Prepares root cause analyses for mdaps with nunn mccurdy breach status or when requested by senior dod officials. However, ritschels 2012 analysis of nunn mccurdy breaches reveals that. Management perspectives pertaining to root cause analyses of nunn mccurdy breaches volumes 6. Cape may, in its discretion, delegate the authority for the conduct of the cost estimate to the sca. Management perspectives pertaining to root cause analyses of.
Nunnmccurdy relief associated with changing programs of record to incorporate new. The pentagon declared a nunn mccurdy breach for the operational control system ocx program this june after costs increased by more than 25 percent over projections. Dod decision breathes new life into critical ocx satellite program. Nunn mccurdy unit cost breaches to the program acquisition unit cost pauc or average procurement unit cost apuc of 25% or more compared to the current apb or 50% or more compared to the original apb significant breach require notification to congress and submission of a sar to congress explaining the causes of the breach. Small diameter bomb ii unit cost growth caused significant nunn mccurdy breach.
Nunn mccurdy unit cost breaches to the program acquisition. As shown in table 1, a significant nunnmccurdy breach occurs when the program acquisition unit cost or the procurement unit cost increases 15% or more over the current baseline estimate or 30% or. A program that experiences cost growth exceeding any of the established thresholds is said to have a nunn mccurdy breach. Download it once and read it on your kindle device, pc, phones or tablets. Raytheon says gps control system ocx on track to hit revised milestones. Navy for inspection and acceptance trials this month. Mccurdy breaches in four of six major defense acquisition programs that had. Initial dod position was to submit sars only for programs with nunnmccurdy breaches due to limit on obligations. Use features like bookmarks, note taking and highlighting while reading the nunnmccurdy act. Dod certifies 6 programs under nunnmccurdy law breaches u. Military and naval science defense programs military procurement laws, regulations and rules management. Nunnmccurdy thresholds there are two categories of breaches.
Cape will conduct an ice for programs using the software acquisition pathway likely to exceed acat i or ii thresholds before the program enters the execution phase ep. Pricetag for pentagons major weapon systems grows by 10. Two billion dollar ddg cost growth explained usni news. The integrated defensive electronic countermeasures idecm blocks 23 program suffered a critical nunn mccurdy breach, with an increase of almost 2. Mar 29, 2011 an even higher trigger point, known as a critical breach under nunn mccurdy, occurs when costs balloon past 25 percent of the current baseline or 50 percent of the original baseline. Whenever the program has a nunn mccurdy unit cost breach d. The new standard prevents dod from simply rebaselining a program to avoid a breach. Aaa driven changes may cause nunn mccurdy breaches and are not necessarily the result of poor management. As a mdap, peo acwa has experienced three nunn mccurdy breaches to date.
Dod notified congress that the programs were in nunn mccurdy breach 90 days ago. The nunn mccurdy process can be a useful mechanism for holding programs accountable for cost growth and restructuring them in the wake of cost growth. Unit cost reporting is required to be reported quarterly in the daes. Nunn mccurdy thresholds there are two categories of breaches. Factors leading to the breach include inadequate systems engineering at program inception, and the. A nunnmccurdy unit cost breach occurs when a major defense acquisition program mdap experiences an increase of at least 15% in program acquisition. The criteria for reporting nunn mccurdy breaches have been modified several times since the 1982 act. Justia gao reports gao11295r trends in nunnmccurdy. Programs in breach may be terminated if the program is not certified by the secretary of defense and restructured. Dod releases new selected acquisition reports sars. The nunnmccurdy amendment or nunnmccurdy provision, introduced by senator sam nunn and congressman dave mccurdy in the united states 1982 defense authorization act and made permanent in 1983, is designed to curtail cost growth in american weapons procurement programs. One is an analysis of the nunn mccurdy breach that occurred in the joint precision approach and landing system increment 1a jpals inc. Mar 09, 2011 for nearly 30 years, the statutory provision, known as nunnmccurdy, has been an oversight tool for congress to hold the department of defense dod accountable for cost growth on major defense programs.
Background, analysis, and issues for congress congressional research service 3 under current dod policy, current apbs cannot be revised just to avoid a nunnmccurdy breach. If a program manager believes a program has experienced a breach, he or she is required to submit a unit cost report that includes. Dod officials notified congress that the programs were in nunn mccurdy breach 90 days ago. Dod plans to propose a legislative amendment to reduce several statutory requirements added in 2009 for nunnmccurdy breaches. Major weapon system acquisition senate armed services. The law requires department of defense dod acquisition programs and other largescale federal gov. Leverages the capabilities of a variety of product support providers. Download it to your device today and never miss a beat. But when most of the programs that breach the threshold are deemed immune from nunn mccurdy and most defense programs go over budget, it seems to me to be more of a case of the usg biting off more than it can chew and only realizing it when you try to swallow.
A program whose cost growth exceeds the statutory thresholds is said to have a nunn mccurdy breach. The purpose of the statute was to provide congress greater visibility into major defense programs cost growth and to encourage dod to manage and control cost growth. Programs that breach once are not more likely to breach a second time. Efficacy of us legislation in military acquisition programmes. Background, analysis, and issues for congress may 12, 2016 open pdf 2 mb the nunnmccurdy act 10 u.
At the discretion of dcape, the ice may be updated during the ep. Trends in nunn mccurdy cost breaches for major defense acquisition programs gao id. The purpose of the act is to help control cost growth in major defense systems by holding the appropriate pentagon officials and defense contractors publicly accountable and responsible for managing costs. Amendment to title 10 introduced by senator sam nunn and congressman dave mccurdy in the national defense authorization act ndaa for fiscal year fy 1982. Management perspectives pertaining to root cause analyses. Dod certifies 6 programs under nunnmccurdy law breaches. Raytheon says gps control system ocx on track to hit. Other significant aviation systems that have had a nunn mccurdy breach in the.
We were asked the following three research questions. Programs that breach more than once had technical issues that were not resolved by corrective actions taken at the first. Dod and commercial advanced waveform developments and. The nunn mccurdy amendment or nunn mccurdy provision, introduced by senator sam nunn and congressman dave mccurdy in the united states 1982 defense authorization act and made permanent in 1983, is designed to curtail cost growth in american weapons procurement programs. In 2007, dod certified the acwa program to congress under the four conditions specified by the act. Are programs that have a nunn mccurdy breach more likely to breach again. As long as the ffrdcs have access to the damir system, they will download their. Dod confirms f35 ioc delays, 50% nunnmccurdy breach. Requires that acquisition category i pms maintain current estimates of program acquisition unit cost pauc and average procurement unit cost apuc. The small diameter bomb iis unit cost grew high enough to trigger a nunn mccurdy breach in the fall because, according to the air forces acquisition chief, the other military services and foreign partners have not bought as many as expected.
For nearly 30 years, the statutory provision, known as nunn mccurdy, has been an oversight tool for congress to hold the department of defense dod accountable for cost growth on major defense programs. No obvious cost growth trends suggest that a program might breach more than once. Arena, john birkler, irv blickstein, charles nemfakos, abby doll, jeffrey a drezner, gordon t lee, megan mckernan, brian mcinnis, carter c. Government accountability office investigators found 74 breaches in 47 major defense acquisition programs since 1997, the earliest date available in dod databases. Programs continue despite cost overruns, gao says federal. In addition, air force officials steering the multiservice program within days officially will notify congress it suffered a unit cost breach of more than 50 percent triggering a socalled nunn mccurdy recertification to congress, militaryprocurement brass told. For example, the nunn mccurdy act threatens the termination of programs upon breach of specified cost overrun thresholds. H1 upgrades sar submitted to congress on july 6, 2009 for a significant nunnmccurdy breach however, in september 2009 at the request of the hasc and sasc, dod agreed to submit pb10 limited sars. In 2010, seven dod programs breached the nunn mccurdy prohibition, but under the law, all that has to happen is for the pentagon to explain why a given program is important.
In addition to reports on major defense acquisition programs, rand, at the request of the sponsor, has researched topics related to the management of defense acquisition. Ocx gets good news, right after nunnmccurdy breaking. Dod certifies six programs under nunnmccurdy law breaches. As shown in table 1, a significant nunn mccurdy breach occurs when the program acquisition unit cost paucdefined as the total cost of development, procurement, and construction divided by the. Jul 12, 2016 a nunn mccurdy breach notifies congress of major cost overruns on major defense acquisition programs. The criteria for reporting nunn mccurdy breaches have been. This research includes such topics as program manager tenure, oversight of acquisition category ii programs, framing assumptions, and programs with multiple nunn mccurdy breaches. In 1983, the nunn mccurdy act was passed into law by the u.
None of the programs on the nunn mccurdy list are surprises to the department or to congress, the official said. The program executive office, assembled chemical weapons alternatives is considered an mdap. Six programs certified for oversight under nunnmccurdy law. Table 4 statutory program breach and change definitions. Issues policies, procedures, and guidance governing the conduct of performance assessment and root cause analysis by military departments and defense agencies. Decisions made during program execution as a root cause of. Exceeding these thresholds is known as a nunnmccurdy breach.
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