50 U.S.C. § 3097 — Budget treatment of costs of acquisition

Page 673 TITLE 50—WAR AND NATIONAL DEFENSE § 3097 Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2004 AMENDMENT For Determination by President that amendment by Pub. L. 108–458 take effect on Apr. 21, 2005, see Memo- randum of President of the United States, Apr. 21, 2005, 70 F.R. 23925, set out as a note under section 3001 of this title. Amendment by Pub. L. 108–458 effective not later than six months after Dec. 17, 2004, except as otherwise expressly provided, see section 1097(a) of Pub. L. 108–458, set out in an Effective Date of 2004 Amendment; Transition Provisions note under section 3001 of this title. INCLUSION OF COUNTERNARCOTICS AS SPECIAL TOPIC IN CERTAIN BUDGET JUSTIFICATION MATERIALS Pub. L. 118–31, div. G, title III, § 7320, Dec. 22, 2023, 137 Stat. 1036, provided that: ‘‘(a) INCLUSION OF COUNTERNARCOTICS AS SPECIAL TOPIC.—For the purposes of the congressional budget justification book for the National Intelligence Pro- gram (as such term is defined in section 3 of the Na- tional Security Act of 1947 (50 U.S.C. 3003)) for each of fiscal years 2025 through 2027, and for any subsequent fiscal year as the Director of National Intelligence de- termines appropriate, information with respect to the aggregate amount of funding requested for counter- narcotics required to be included as part of the budget justification materials submitted to Congress under section 506(a)(3) of such Act [50 U.S.C. 3096(a)(3)] shall be included as a provision relating to a special topic in such congressional budget justification book. ‘‘(b) CONTENTS.—With respect to a fiscal year, the special topic provision included in the congressional budget justification book pursuant to subsection (a) re- garding the aggregate amount of funding requested for counternarcotics shall include— ‘‘(1) a summary of the main activities and invest- ments that such requested funding would support; ‘‘(2) a breakdown of such requested funding by pro- gram, budget category, intelligence discipline, and any other appropriate classification; ‘‘(3) a comparison of aggregate requested funding and aggregate enacted funding for counternarcotics for the current fiscal year and the previous fiscal year; ‘‘(4) the number of full-time equivalent civilian and military personnel assigned to the counternarcotics mission of the intelligence community; and ‘‘(5) such other information as the Director of Na- tional Intelligence determines appropriate.’’ [For definition of ‘‘intelligence community’’ as used in section 7320 of Pub. L. 118–31, set out above, see sec- tion 7002 of Pub. L. 118–31, set out as a note under sec- tion 3003 of this title.] § 3097. Budget treatment of costs of acquisition of major systems by the intelligence commu- nity (a) Independent cost estimates (1) The Director of National Intelligence shall, in consultation with the head of each element of the intelligence community concerned, prepare an independent cost estimate of the full life- cycle cost of development, procurement, and op- eration of each major system to be acquired by the intelligence community. (2)(A) Each independent cost estimate for a major system shall, to the maximum extent practicable, specify the amount required to be appropriated and obligated to develop, procure, and operate the major system in each fiscal year of the proposed period of development, procure- ment, and operation of the major system. (B) For major system acquisitions requiring a service or capability from another acquisition or program to deliver the end-to-end functionality for the intelligence community end users, inde- pendent cost estimates shall include, to the maximum extent practicable, all estimated costs across all pertinent elements of the intel- ligence community. For collection programs, such cost estimates shall include the cost of new analyst training, new hardware and software for data exploitation and analysis, and any unique or additional costs for data processing, storing, and power, space, and cooling across the life cycle of the program. If such costs for proc- essing, exploitation, dissemination, and storage are scheduled to be executed in other elements of the intelligence community, the independent cost estimate shall identify and annotate such costs for such other elements accordingly. (3)(A) In the case of a program of the intel- ligence community that qualifies as a major system, an independent cost estimate shall be prepared before the submission to Congress of the budget of the President for the first fiscal year in which appropriated funds are anticipated to be obligated for the development or procure- ment of such major system. (B) In the case of a program of the intelligence community for which an independent cost esti- mate was not previously required to be prepared under this section, including a program for which development or procurement commenced before December 13, 2003, if the aggregate future costs of development or procurement (or any combination of such activities) of the program will exceed $500,000,000 (in current fiscal year dollars), the program shall qualify as a major system for purposes of this section, and an inde- pendent cost estimate for such major system shall be prepared before the submission to Con- gress of the budget of the President for the first fiscal year thereafter in which appropriated funds are anticipated to be obligated for such major system. (4) The independent cost estimate for a major system shall be updated upon— (A) the completion of any preliminary de- sign review associated with the major system; (B) any significant modification to the an- ticipated design of the major system; or (C) any change in circumstances that ren- ders the current independent cost estimate for the major system inaccurate. (5) Any update of an independent cost esti- mate for a major system under paragraph (4) shall meet all requirements for independent cost estimates under this section, and shall be treat- ed as the most current independent cost esti- mate for the major system until further updated under that paragraph. (b) Preparation of independent cost estimates (1) The Director shall establish within the Of- fice of the Director of National Intelligence for Community Management an office which shall be responsible for preparing independent cost es- timates, and any updates thereof, under sub- section (a), unless a designation is made under paragraph (2). (2) In the case of the acquisition of a major system for an element of the intelligence com- munity within the Department of Defense, the Director and the Secretary of Defense shall pro- Page 674 TITLE 50—WAR AND NATIONAL DEFENSE § 3097 1 See References in Text note below. vide that the independent cost estimate, and any updates thereof, under subsection (a) be pre- pared by an entity jointly designated by the Di- rector and the Secretary in accordance with sec- tion 2434(b)(1)(A) 1 of title 10. (c) Utilization in budgets of President (1) If the budget of the President requests ap- propriations for any fiscal year for the develop- ment or procurement of a major system by the intelligence community, the President shall, subject to paragraph (2), request in such budget an amount of appropriations for the develop- ment or procurement, as the case may be, of the major system that is equivalent to the amount of appropriations identified in the most current independent cost estimate for the major system for obligation for each fiscal year for which ap- propriations are requested for the major system in such budget. (2) If the amount of appropriations requested in the budget of the President for the develop- ment or procurement of a major system is less than the amount of appropriations identified in the most current independent cost estimate for the major system for obligation for each fiscal year for which appropriations are requested for the major system in such budget, the President shall include in the budget justification mate- rials submitted to Congress in support of such budget— (A) an explanation for the difference be- tween the amount of appropriations requested and the amount of appropriations identified in the most current independent cost estimate; (B) a description of the importance of the major system to the national security; (C) an assessment of the consequences for the funding of all programs of the National In- telligence Program in future fiscal years if the most current independent cost estimate for the major system is accurate and additional appropriations are required in future fiscal years to ensure the continued development or procurement of the major system, including the consequences of such funding shortfalls on the major system and all other programs of the National Intelligence Program; and (D) such other information on the funding of the major system as the President considers appropriate. (d) Inclusion of estimates in budget justification materials The budget justification materials submitted to Congress in support of the budget of the President shall include the most current inde- pendent cost estimate under this section for each major system for which appropriations are requested in such budget for any fiscal year. (e) Definitions In this section: (1) The term ‘‘budget of the President’’ means the budget of the President for a fiscal year as submitted to Congress under section 1105(a) of title 31. (2)(A) The term ‘‘independent cost estimate’’ means a pragmatic and neutral analysis, as- sessment, and quantification of all costs and risks associated with the development, acqui- sition, procurement, operation, and sustainment of a major system across its pro- posed life cycle, which shall be based on pro- grammatic and technical specifications pro- vided by the office within the element of the intelligence community with primary respon- sibility for the development, procurement, or operation of the major system. (B) In accordance with subsection (a)(2)(B), each independent cost estimate shall include all costs required across elements of the intel- ligence community to develop, acquire, pro- cure, operate, and sustain the system to pro- vide the end-to-end intelligence functionality of the system, including— (i) for collection programs, the cost of new analyst training, new hardware and software for data exploitation and analysis, and any unique or additional costs for data proc- essing, storing, and power, space, and cool- ing across the life cycle of the program; and (ii) costs for processing, exploitation, dis- semination, and storage scheduled to be exe- cuted in other elements of the intelligence community. (3) The term ‘‘major system’’ means any sig- nificant program of an element of the intel- ligence community with projected total devel- opment and procurement costs exceeding $500,000,000 (based on fiscal year 2010 constant dollars), which costs shall include all end-to- end program costs, including costs associated with the development and procurement of the program and any other costs associated with the development and procurement of systems required to support or utilize the program. (July 26, 1947, ch. 343, title V, § 506A, as added Pub. L. 108–177, title III, § 312(b)(1), Dec. 13, 2003, 117 Stat. 2607; amended Pub. L. 108–458, title I, §§ 1071(a)(1)(BB), 1072(a)(6), Dec. 17, 2004, 118 Stat. 3689, 3692; Pub. L. 111–259, title III, § 321(b), Oct. 7, 2010, 124 Stat. 2669; Pub. L. 112–87, title III, § 306(a), title V, § 505(3), Jan. 3, 2012, 125 Stat. 1881, 1897.) Editorial Notes REFERENCES IN TEXT Section 2434 of title 10, referred to in subsec. (b)(2), was repealed by Pub. L. 114–328, div. A, title VIII, § 842(c)(1), Dec. 23, 2016, 130 Stat. 2290. CODIFICATION Section was formerly classified to section 415a–1 of this title prior to editorial reclassification and renum- bering as this section. AMENDMENTS 2012—Subsec. (a)(2). Pub. L. 112–87, § 306(a)(1), des- ignated existing provisions as subpar. (A) and added subpar. (B). Subsec. (c)(2)(C). Pub. L. 112–87, § 505(3), substituted ‘‘National Intelligence Program’’ for ‘‘National Foreign Intelligence Program’’ in two places. Subsec. (e)(2). Pub. L. 112–87, § 306(a)(2), designated ex- isting provisions as subpar. (A), substituted ‘‘associated with the development, acquisition, procurement, oper- ation, and sustainment of a major system across its proposed life cycle,’’ for ‘‘associated with the acquisi- tion of a major system,’’, and added subpar. (B). 2010—Subsec. (e)(3). Pub. L. 111–259 substituted ‘‘(based on fiscal year 2010 constant dollars)’’ for ‘‘(in current fiscal year dollars)’’. Page 675 TITLE 50—WAR AND NATIONAL DEFENSE § 3098 2004—Subsec. (a)(1). Pub. L. 108–458, § 1071(a)(1)(BB), substituted ‘‘Director of National Intelligence’’ for ‘‘Di- rector of Central Intelligence’’. Subsec. (b)(1). Pub. L. 108–458, § 1072(a)(6), substituted ‘‘Office of the Director of National Intelligence’’ for ‘‘Office of the Deputy Director of Central Intelligence’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2012 AMENDMENT Pub. L. 112–87, title III, § 306(b), Jan. 3, 2012, 125 Stat. 1882, provided that: ‘‘The amendments made by this section [amending this section] shall take effect on the date that is 180 days after the date of the enactment of this Act [Jan. 3, 2012].’’ EFFECTIVE DATE OF 2004 AMENDMENT For Determination by President that amendment by Pub. L. 108–458 take effect on Apr. 21, 2005, see Memo- randum of President of the United States, Apr. 21, 2005, 70 F.R. 23925, set out as a note under section 3001 of this title. Amendment by Pub. L. 108–458 effective not later than six months after Dec. 17, 2004, except as otherwise expressly provided, see section 1097(a) of Pub. L. 108–458, set out in an Effective Date of 2004 Amendment; Transition Provisions note under section 3001 of this title. EFFECTIVE DATE Pub. L. 108–177, title III, § 312(c), Dec. 13, 2003, 117 Stat. 2609, provided that: ‘‘The amendments made by subsection (b) [enacting this section] shall take effect on the date of the enactment of this Act [Dec. 13, 2003].’’ CONGRESSIONAL FINDINGS Pub. L. 108–177, title III, § 312(a), Dec. 13, 2003, 117 Stat. 2606, provided that: ‘‘Congress makes the fol- lowing findings: ‘‘(1) Funds within the National Foreign Intelligence Program often must be shifted from program to pro- gram and from fiscal year to fiscal year to address funding shortfalls caused by significant increases in the costs of acquisition of major systems by the in- telligence community. ‘‘(2) While some increases in the costs of acquisi- tion of major systems by the intelligence community are unavoidable, the magnitude of growth in the costs of acquisition of many major systems indicates a systemic bias within the intelligence community to underestimate the costs of such acquisition, particu- larly in the preliminary stages of development and production. ‘‘(3) Decisions by Congress to fund the acquisition of major systems by the intelligence community rely significantly upon initial estimates of the afford- ability of acquiring such major systems and occur within a context in which funds can be allocated for a variety of alternative programs. Thus, substantial increases in costs of acquisition of major systems place significant burdens on the availability of funds for other programs and new proposals within the Na- tional Foreign Intelligence Program. ‘‘(4) Independent cost estimates, prepared by inde- pendent offices, have historically represented a more accurate projection of the costs of acquisition of major systems. ‘‘(5) Recognizing the benefits associated with inde- pendent cost estimates for the acquisition of major systems, the Secretary of Defense has built upon the statutory requirement in [former] section 2434 of title 10, United States Code, to develop and consider inde- pendent cost estimates for the acquisition of such systems by mandating the use of such estimates in budget requests of the Department of Defense. ‘‘(6) The mandatory use throughout the intelligence community of independent cost estimates for the ac- quisition of major systems will assist the President and Congress in the development and funding of budg- ets which more accurately reflect the requirements and priorities of the United States Government for intelligence and intelligence-related activities.’’ LIMITATIONS ON MAJOR SYSTEM PROCUREMENT, ACQUISITION, AND DEVELOPMENT Pub. L. 108–177, title III, § 312(d), Dec. 13, 2003, 117 Stat. 2609, provided that: ‘‘(1)(A) For each major system for which funds have been authorized for a fiscal year before fiscal year 2005, or for which funds are sought in the budget of the President for fiscal year 2005, as submitted to Congress pursuant to section 1105(a) of title 31, United States Code, and for which no independent cost estimate has been provided to Congress, no contract, or option to contract, for the procurement or acquisition of such major system may be entered into, or option to con- tract be exercised, before the date of the enactment of an Act to authorize appropriations for fiscal year 2005 for intelligence and intelligence-related activities of the United States Government. ‘‘(B) Subparagraph (A) shall not affect any contract for procurement or acquisition that was entered into before the date of the enactment of this Act [Dec. 13, 2003]. ‘‘(2) Commencing as of the date of the submittal to Congress of the budget of the President for fiscal year 2006 pursuant to section 1105(a) of title 31, United States Code, no funds may be obligated or expended for the development or procurement of a major system until the President has complied with the requirements of section 506A of the National Security Act of 1947 (as added by subsection (b)) [50 U.S.C. 3097] with respect to such major system. ‘‘(3) In this subsection, the terms ‘independent cost estimate’ and ‘major system’ have the meaning given such terms in subsection (e) of section 506A of the Na- tional Security Act of 1947 (as so added) [50 U.S.C. 3097(e)].’’ § 3098. Annual personnel level assessments for the intelligence community (a) Requirement to provide The Director of National Intelligence shall, in consultation with the head of each element of the intelligence community, prepare an annual personnel level assessment for such element that assesses the personnel levels for such ele- ment for the fiscal year following the fiscal year in which the assessment is submitted. (b) Schedule Each assessment required by subsection (a) shall be submitted to the congressional intel- ligence committees each year at the time that the President submits to Congress the budget for a fiscal year pursuant to section 1105 of title 31. (c) Contents Each assessment required by subsection (a) submitted during a fiscal year shall contain the following information for the element of the in- telligence community concerned: (1) The budget submission for personnel costs for the upcoming fiscal year. (2) The dollar and percentage increase or de- crease of such costs as compared to the per- sonnel costs of the current fiscal year. (3) The dollar and percentage increase or de- crease of such costs as compared to the per- sonnel costs during the prior 5 fiscal years. (4) The number of full-time equivalent posi- tions that is the basis for which personnel