H.R. 4372 — To amend title 10 to shorten breach reporting timelines, increase program transparency, and improve congressional oversight of Department of Defense cost overruns with respect to the cost growth for major systems, and for other purposes.

This section shortens timelines for Nunn-McCurdy breach determinations and congressional notifications for major defense acquisition programs (i.e., Selected Acquisition Reports tracking program acquisition unit cost and procurement unit cost against significant or critical cost growth thresholds). Specifically, it (1) requires each service acquisition executive to determine whether thresholds are met within 30 days after receiving a unit cost report (previously, upon submission with no deadline), and (2) requires the Secretary concerned to notify Congress within 30 days after the determination date for reports under 10 USC 4372 (quarterly) or 4373 (other) (previously, within 45 days after quarter-end or report date).

This section directs the Secretary of Defense to designate each end item as a major subprogram for acquisition reporting purposes if a major defense acquisition program requires delivery of two or more such end items, each estimated to require more than $500 million in eventual total expenditures for research, development, test, evaluation, operation, and support. (Thus, these high-cost end items—such as major weapon system components—receive separate congressional oversight and reporting akin to standalone major defense acquisition programs.)

This section modifies the critical cost growth (Nunn-McCurdy) requirements for major defense acquisition programs (MDAPs)—which trigger reassessment and potential termination when program acquisition unit cost or procurement unit cost exceeds the critical cost growth threshold (typically 30% above baseline)—as follows: (1) establishes mandatory termination for an MDAP experiencing a second such cost breach, prohibiting the Secretary of Defense from submitting a continuation certification and requiring termination within 90 days of reassessment (with no such second-breach exclusion previously); (2) requires the Secretary to publicly post on a Department of Defense website each report on program termination options previously submitted only to congressional defense committees; (3) prohibits the Secretary from delegating submission of any continuation certification; and (4) requires consideration of termination plans that maximize government value from obligated or expended funds (e.g., completing in-production end items with resale value exceeding completion costs).