US Code

Public Law 119-73 (01/23/2026)

10 U.S.C. § 4375

Breach of significant cost growth threshold or critical cost growth threshold: required action

(a)

Breach of significant cost growth threshold; submission of a selected acquisition report.—

(1)

General rule .—

section 4374 of this titlesection 4351(e) of this titlesection 4351(f) of this titleExcept as provided in paragraph (2), whenever the Secretary concerned determines under that the program acquisition unit cost or the procurement unit cost of a major defense acquisition program or designated major subprogram has increased by a percentage equal to or greater than the significant cost growth threshold for the program or subprogram, a Selected Acquisition Report shall be submitted to Congress for the first fiscal-year quarter ending on or after the date of the determination or for the fiscal-year quarter which immediately precedes the first fiscal-year quarter ending on or after that date. The report shall include the information described in and shall be submitted in accordance with .
(2)
section 1105 of title 31 Whenever the Secretary makes a determination referred to in paragraph (1) in the case of a major defense acquisition program or designated major subprogram during the second quarter of a fiscal year and before the date on which the President transmits the budget for the following fiscal year to Congress pursuant to , the Secretary is not required to file a Selected Acquisition Report under paragraph (1) but shall include the information described in subsection (d) regarding that program or subprogram in the comprehensive annual Selected Acquisition Report submitted in that quarter.
(b)

Breach of Critical Cost Growth Threshold .—

section 4374 of this titleIf the program acquisition unit cost or procurement unit cost of a major defense acquisition program or designated major subprogram (as determined by the Secretary under ) increases by a percentage equal to or greater than the critical cost growth threshold for the program or subprogram, the Secretary of Defense shall take actions consistent with the requirements of sections 4376 and 4377 of this title.
(c)

Prohibition on Obligation of Funds for Certain Purposes When Required Action Not Taken.—

(1)

Prohibition .—

section 4374 of this titlesection 4374 of this titleIf a determination of an increase by a percentage equal to or greater than the significant cost growth threshold is made by the Secretary under and a Selected Acquisition Report containing the information described in subsection (d) is not submitted to Congress under subsection (a), or if a determination of an increase by a percentage equal to or greater than the critical cost growth threshold is made by the Secretary under and the certification of the Secretary of Defense is not submitted to Congress under subsection (b), funds appropriated for military construction, for research, development, test, and evaluation, and for procurement may not be obligated for a major contract under the program.
(2)

Termination of prohibition .—

section 8677(b)(2) of this titleThe prohibition under paragraph (1) on the obligation of funds for a major defense acquisition program shall cease to apply at the end of a period of 30 days of continuous session of Congress (as determined under ) beginning on the date—
(A)
section 4374 of this title on which Congress receives the Selected Acquisition Report under subsection (a) with respect to that program, in the case of a determination of an increase by a percentage equal to or greater than the significant cost growth threshold (as determined in ); or
(B)
section 4374 of this title on which Congress has received both the Selected Acquisition Report under subsection (a) and the certification of the Secretary of Defense under section 4376 with respect to that program, in the case of an increase by a percentage equal to or greater than the critical cost growth threshold (as determined under ).
(d)

Matter to Be Included in Reports .—

Except as provided in subsection (e), each report under this section with respect to a major defense acquisition program shall include the following:
(1)
The name of the major defense acquisition program.
(2)
The date of the preparation of the report.
(3)
The program phase as of the date of the preparation of the report.
(4)
The estimate of the program acquisition cost for the program (and for each designated major subprogram under the program) as shown in the Selected Acquisition Report in which the program or subprogram was first included, expressed in constant base-year dollars and in current dollars.
(5)
The current program acquisition cost for the program (and for each designated major subprogram under the program) in constant base-year dollars and in current dollars.
(6)
A statement of the reasons for any increase in program acquisition unit cost or procurement unit cost for the program (or for any designated major subprogram under the program).
(7)
The completion status of the program and each designated major subprogram under the program—
(A)
expressed as the percentage that the number of years for which funds have been appropriated for the program or subprogram is of the number of years for which it is planned that funds will be appropriated for the program or subprogram; and
(B)
expressed as the percentage that the amount of funds that have been appropriated for the program or subprogram is of the total amount of funds which it is planned will be appropriated for the program or subprogram.
(8)
The fiscal year in which information on the program and each designated major subprogram under the program was first included in a Selected Acquisition Report (referred to in this paragraph as the “base year”) and the date of that Selected Acquisition Report in which information on the program or subprogram was first included.
(9)
section 4214 of this title The type of the Baseline Estimate that was included in the baseline description under and the date of the Baseline Estimate.
(10)
The current change and the total change, in dollars and expressed as a percentage, in the program acquisition unit cost for the program (or for each designated major subprogram under the program), stated both in constant base-year dollars and in current dollars.
(11)
The current change and the total change, in dollars and expressed as a percentage, in the procurement unit cost for the program (or for each designated major subprogram under the program), stated both in constant base-year dollars and in current dollars and the procurement unit cost for the program (or for each designated major subprogram under the program) for the succeeding fiscal year expressed in constant base-year dollars and in current year dollars.
(12)
The quantity of end items to be acquired under the program and the current change and total change, if any, in that quantity.
(13)
The identities of the military and civilian officers responsible for program management and cost control of the program.
(14)
The action taken and proposed to be taken to control future cost growth of the program.
(15)
Any changes made in the performance or schedule milestones of the program and the extent to which such changes have contributed to the increase in program acquisition unit cost or procurement unit cost for the program (or for any designated major subprogram under the program).
(16)
The following contract performance assessment information with respect to each major contract under the program or subprogram:
(A)
The name of the contractor.
(B)
The phase that the contract is in at the time of the preparation of the report.
(C)
The percentage of work under the contract that has been completed.
(D)
Any current change and the total change, in dollars and expressed as a percentage, in the contract cost.
(E)
The percentage by which the contract is currently ahead of or behind schedule.
(F)
A narrative providing a summary explanation of the most significant occurrences, including cost and schedule variances under major contracts of the program and any designated major subprogram under the program, contributing to the changes identified and a discussion of the effect these occurrences will have on future program costs and the program schedule.
(17)
In any case in which one or more problems with the software component of the program or any designated major subprogram under the program significantly contributed to the increase in program unit costs, the action taken and proposed to be taken to solve such problems.
(e)

Breach Due to Termination or Cancellation of Program or Subprogram.—

(1)

Limited reporting .—

If a program acquisition unit cost increase or a procurement unit cost increase for a major defense acquisition program or designated major subprogram that results in a report under this subsection is due to termination or cancellation of the entire program or subprogram, only the information specified in paragraphs (1) through (6) of subsection (d) and the percentage change in program acquisition unit cost or procurement unit cost that resulted in the report need be included in the report.
(2)

Certification not required .—

The certification of the Secretary of Defense under subsection (b) is not required to be submitted for termination or cancellation of a program or subprogram.

Pub. L. 116–283, div. A, title XVIII, § 1850(a)134 Stat. 4265Pub. L. 117–81, div. A, title XVII, § 1701(c)(4)o135 Stat. 2136(Added and amended , (h), (i), , , 4267, 4269; , (d)(12), ()(6)(E)(iv), , , 2137, 2148.)

Editorial Notes

Codification

section 2433 of this titlePub. L. 116–283, § 1850(h)(1)Pub. L. 97–252, title XI, § 1107(a)(1)96 Stat. 741Pub. L. 98–525, title XII, § 1242(b)(5)98 Stat. 2608Pub. L. 99–433, title I, § 101(a)(5)100 Stat. 995Pub. L. 100–180, div. A, title XIII, § 1314(a)(1)101 Stat. 1175Pub. L. 101–189, div. A, title VIII, § 811(a)(5)103 Stat. 1491Pub. L. 102–484, div. A, title VIII, § 817(d)(5)106 Stat. 2457Pub. L. 103–35, title II, § 201(i)(2)107 Stat. 100Pub. L. 103–355, title III, § 3002(a)(2)(C)108 Stat. 3328Pub. L. 109–163, div. A, title VIII, § 802(b)(3)119 Stat. 3369Pub. L. 109–364, div. A, title II, § 213(a)120 Stat. 2121Pub. L. 110–181, div. A, title IX, § 942(e)122 Stat. 288Pub. L. 110–417122 Stat. 4523Pub. L. 111–23, title II, § 206(a)(3)123 Stat. 1728Pub. L. 115–232, div. A, title VIII, § 809(a)132 Stat. 1840The text of subsec. (e) of , which was transferred to this section, redesignated subsecs. (a) to (c), and amended by , was based on , , , § 139b; , , ; renumbered § 2433, , , ; , , ; , , ; , , ; , , ; , , ; , (c), , ; , , ; , , ; , [div. A], title VIII, § 811(c)(5), , ; , , ; , , .

section 2433 of this titlePub. L. 116–283, § 1850(i)(1)Pub. L. 97–252, title XI, § 1107(a)(1)96 Stat. 741Pub. L. 98–94, title XII, § 1268(1)97 Stat. 705Pub. L. 98–525, title XII, § 1242(b)(6)98 Stat. 2608Pub. L. 99–433, title I, § 101(a)(5)100 Stat. 995Pub. L. 100–180, div. A, title XIII, § 1314(a)(1)101 Stat. 1175Pub. L. 101–189, div. A, title VIII, § 811(a)(6)103 Stat. 1493Pub. L. 103–355, title III, § 3003(e)108 Stat. 3329Pub. L. 108–375, div. A, title VIII, § 801(b)(1)118 Stat. 2004Pub. L. 110–417122 Stat. 4523Pub. L. 111–84, div. A, title X, § 1073(c)(4)123 Stat. 2474The text of subsec. (g) of , which was transferred to this section, redesignated subsecs. (d) and (e), and amended by , was based on , , , § 139b; , , ; , , ; renumbered § 2433, , , ; , , ; , , ; , , ; , , ; , [div. A], title VIII, § 811(c)(6), , ; , , .

Amendments

Pub. L. 116–283, § 1850(i)(1)section 2433 of this title2021—, transferred subsec. (g) of to this section, struck out subsec. designation, and redesignated pars. (1) and (2) as subsecs. (d) and (e), respectively.

Pub. L. 116–283, § 1850(h)(1)section 2433 of this title, transferred subsec. (e) of to this section, struck out subsec. designation, and redesignated pars. (1) to (3) as subsecs. (a) to (c), respectively.

Pub. L. 116–283, § 1850(h)(2)(A)Subsec. (a). , (B), inserted subsec. heading, redesignated subpars. (A) and (B) as pars. (1) and (2), respectively, inserted par. (1) heading, and substituted “Except as provided in paragraph (2),” for “Except as provided in subparagraph (B),” in par. (1).

Pub. L. 116–283, § 1850(h)(2)(C)Pub. L. 117–81, § 1701osection 4374 of this titleSubsec. (a)(1). , as amended by ()(6)(E)(iv), substituted “under ” for “under subsection (d)”, “section 4351(e)” for “section 2432(e)”, and “section 4351(f)” for “section 2432(f)”.

Pub. L. 116–283, § 1850(h)(2)(D)Subsec. (a)(2). , substituted “paragraph (1)” for “subparagraph (A)” in two places and “subsection (d)” for “subsection (g)”.

Pub. L. 116–283, § 1850(h)(3)section 4374 of this titleSubsec. (b). , inserted heading and substituted “” for “subsection (d)” and “sections 4376 and 4377” for “section 2433a”.

Pub. L. 116–283, § 1850(h)(4)(A)Subsec. (c). , (B), inserted subsec. heading, designated first and second sentences as pars. (1) and (2), respectively, and inserted par. (1) heading.

Pub. L. 116–283, § 1850(h)(4)(C)section 4374 of this titleSubsec. (c)(1). , substituted “” for “subsection (d)” in two places, “subsection (d)” for “subsection (g)”, “subsection (a)” for “paragraph (1)”, and “subsection (b)” for “paragraph (2)”.

Pub. L. 116–283, § 1850(h)(4)(D)(i)Subsec. (c)(2). , inserted heading and substituted “The prohibition under paragraph (1)” for “The prohibition” in introductory provisions.

Pub. L. 117–81, § 1701(d)(12)(A)Subsec. (c)(2)(A). , struck out “or (b)(2)” after “subsection (a)”.

Pub. L. 116–283, § 1850(h)(4)(D)(ii)section 4374 of this title, substituted “subsection (a) or (b)(2)” for “paragraph (1) or (2)(B)” and “” for “subsection (d)”.

Pub. L. 117–81, § 1701(d)(12)(B)Subsec. (c)(2)(B). , struck out “or (b)(2)” after “subsection (a)” and substituted “section 4376” for “subsection (b)(1)”.

Pub. L. 116–283, § 1850(h)(4)(D)(iii)section 4374 of this title, substituted “subsection (a) or (b)(2)” for “paragraph (1) or (2)(B)”, “subsection (b)(1)” for “paragraph (2)(A)”, and “” for “subsection (d)”.

Pub. L. 116–283, § 1850(i)(2)(A)Subsec. (d). , (B), inserted heading, substituted “Except as provided in subsection (e), each report under this section” for “Except as provided in paragraph (2), each report under subsection (e)” in introductory provisions, and redesignated subpars. (A) to (Q) as pars. (1) to (17), respectively.

Pub. L. 117–81, § 1701(c)(4)Subsec. (d)(7). , substituted “under the program—

“(A) expressed as”

for “under the program (i) expressed as” and “or subprogram; and

“(B) expressed as”

for “or subprogram, and (ii) expressed as”.

Pub. L. 116–283, § 1850(i)(2)(C)Subsec. (d)(9). , substituted “section 4214” for “section 2435”.

Pub. L. 116–283, § 1850(i)(2)(D)Subsec. (d)(16). , redesignated cls. (i) to (vi) as subpars. (A) to (F), respectively.

Pub. L. 116–283, § 1850(i)(3)(A)Subsec. (e). –(C), inserted subsec. heading, designated first and second sentences as pars. (1) and (2), respectively, inserted par. (1) heading, and, in par. (1), substituted “paragraphs (1) through (6) of subsection (d)” for “clauses (A) through (F) of paragraph (1)”.

Pub. L. 116–283, § 1850(i)(3)(D)Subsec. (e)(2). , inserted heading and substituted “subsection (b)” for “subsection (e)”.

Statutory Notes and Related Subsidiaries

Effective Date of 2021 Amendment

Pub. L. 117–81Pub. L. 116–283section 1701(a)(3) of Pub. L. 117–81section 3001 of this titleAmendment by section 1701(c)(4), (d)(12) of to take effect immediately after the amendments made by title XVIII of have taken effect, see , set out in a note preceding and Effective Date note below.

oPub. L. 117–81Pub. L. 116–283section 1701(a)(2) of Pub. L. 117–81section 3001 of this titleAmendment by section 1701()(6)(E)(iv) of applicable as if included in the enactment of title XVIII of as enacted, see , set out in a note preceding and Effective Date note below.

Effective Date

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