Sec. 131. Economic order quantity contracting and buy-to-budget acquisition for F–35 aircraft program
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Subject to paragraphs
(2)through (5), from amounts made available for obligation under the F–35 aircraft program for fiscal year 2020, the Secretary of Defense may enter into one or more contracts, beginning with the fiscal year 2020 program year, for the procurement of economic order quantities of material and equipment that has completed formal hardware qualification testing for the F–35 aircraft program for use in procurement contracts to be awarded for such program during fiscal years 2021, 2022, and 2023. The total amount obligated under all contracts entered into under paragraph
(1)shall not exceed $574,000,000. Before entering into a contract under paragraph (1), the Secretary of Defense shall make each of the following findings with respect to such contract: The use of such a contract will result in significant savings of the total anticipated costs of carrying out the program through annual contracts. The minimum need for the property to be procured is expected to remain substantially unchanged during the contemplated contract period in terms of production rate, procurement rate, and total quantities. There is a reasonable expectation that, throughout the contemplated contract period, the Secretary will request funding for the contract at the level required to avoid contract cancellation. That there is a stable, certified, and qualified design for the property to be procured and that the technical risks and redesign risks associated with such property are low. The estimates of both the cost of the contract and the anticipated cost avoidance through the use of an economic order quantity contract are realistic. Entering into the contract will promote the national security interests of the United States. Except as provided in paragraph (5), the Secretary of Defense may not enter into a contract under paragraph
(1)until a period of 30 days has elapsed following the date on which the Secretary certifies to the congressional defense committees, in writing, that each of the following conditions is satisfied: A sufficient number of end items of the system being acquired under such contract have been delivered at or within the most recently available estimates of the program acquisition unit cost or procurement unit cost for such system to determine that the estimates of the unit costs are realistic. During the fiscal year in which such contract is to be awarded, sufficient funds will be available to perform the contract in such fiscal year, and the future-years defense program submitted to Congress under section 221 of title 10, United States Code, for that fiscal year will include the funding required to execute the program without cancellation. The contract is a fixed-price type contract. The proposed contract provides for production at not less than minimum economic rates given the existing tooling and facilities. The Secretary has determined that each of the conditions described in subparagraphs
(A)through
(F)of paragraph
(3)will be met by such contract and has provided the basis for such determination to the congressional defense committees. The determination under subparagraph
(E)was made after the completion of a cost analysis performed by the Director of Cost Assessment and Program Evaluation for the purpose of section 2334 of title 10, United States Code, and the analysis supports that determination. Notwithstanding paragraph (4), the Secretary of Defense may enter into a contract under paragraph
(1)on or after March 1, 2020, if— the Director of Cost Assessment and Program Evaluation has not completed a cost analysis of the preliminary findings made by the Secretary under paragraph
(3)with respect to the contract; the Secretary certifies to the congressional defense committees, in writing, that each of the conditions described in subparagraphs
(A)through
(E)of paragraph
(4)is satisfied; and a period of 30 days has elapsed following the date on which the Secretary submits the certification under subparagraph (B). Subject to section 2308 of title 10, United States Code, using funds authorized to be appropriated by this Act for the procurement of F–35 aircraft, the Secretary of Defense may procure a quantity of F–35 aircraft in excess of the quantity authorized by this Act if such additional procurement does not require additional funds to be authorized to be appropriated because of production efficiencies or other cost reductions.