Life Cycle Cost Composition - PowerPoint Presentation

Life Cycle Cost Composition MILCON Facilities Disposal O&M (or others as appropriate ) RDT & E Development Costs of PME & Support Items Systems Engineering Program Management Test & Evaluation RDT & E Development Costs of PME & Support Items Systems Engineering Program Management Test & Evaluation Development Cost Operations & Support • O&M, MILPERS Operating and Support O&M, MILPERS (or others as appropriate) PROCUREMENT Initial Spares PROCUREMENT Prime Mission Equipment (PME ) PROCUREMENT Support Items Flyaway Cost Weapon System Cost Procurement Cost Life Cycle Cost Program Acquisition Cost

Cost Estimating Requirements ACAT IC & ID (MDAP) ACAT IA (MAIS)POE Program initiation & all subsequent Program initiation & all subsequent milestones, including FRP DR milestones - Includes Economic AnalysisCARD MS A & all subsequent milestones MS A & whenever including FRP DR Economic Analysis is required - Draft 180 days prior to OIPT/milestone - Draft 180 days prior to OIPT/milestone - Final 45 days prior to OIPT/milestone - Final 45 days prior to OIPT/milestoneCCE MS A and all subsequent milestones MS A and whenever an Economic Analysis including FRP DR is requiredICE Required by law for all MDAP programs * - Prepared by OSD CAPE for ACAT ID, and ACAT IC at discretion of USD (AT&L) - Prepared by component cost agency (AFCAA, DASA-CE, NCCA) for ACAT IC (if no CAPE estimate) - In advance of any certification under Title 10, USC, Section 2366a (MS A) and Section 2366b (MS B) - In advance of any decision to enter low-rate initial production (LRIP) (MS C) or full-rate production (FRP DR) - In advance of any certification of MDAPs that experience critical cost growth (Title 10, USC, Sec 2433a) - In advance of any report of Critical Program Changes for MAIS (Title 10, USC, Sec 2445c(f))*ICE statutory requirement (Title 10, US Code, Sec 2434) and P.L. 111-23, May 22, 2009Source: DoDI 5000.02, January 2015 and Weapon Systems Acquisition Reform Act of 2009 ACAT II & ACAT III: POE (and, at MDA discretion, an independent cost estimate prepared by the component cost agency)at program initiation and all subsequent milestones AFCAA = Air Force Cost Analysis AgencyACAT = Acquisition Category CAPE = Cost Assessment & Program EvaluationCARD = Cost Analysis Requirements DescriptionCCE = Component Cost EstimateDASA-CE = Dep Asst Sec of Army (Cost & Economics) FRP DR = Full Rate Production Decision ReviewICE = Independent Cost Estimate MAIS = Major Automated Information SystemMDA = Milestone Decision AuthorityMDAP = Major Defense Acquisition ProgramNCCA = Naval Center for Cost AnalysisOIPT = Overarching Integrated Product TeamPOE = Program Office EstimateUSD(AT&L) = Under Secretary of Defense (Acquisition, Technology, & Logistics)

CIA – Central Intelligence Agency COCOM – Combatant CommanderCPR – Chairman’s Program RecommendationDIA – Defense Intelligence AgencyDPG – Defense Planning GuidanceDSR – Defense Strategy Review formerly known as the Quadrennial Defense ReviewJCS – Joint Chiefs of StaffNDS – National Defense StrategyNMS – National Military StrategyNSS – National Security StrategyOSD – Office of the Secretary of DefenseUSD(P) – Undersecretary of Defense (Policy) PresidentNational Security CouncilCIA/DIA/JCS/OSD (JCS, COCOMs,SERVICES)NMS DPG NSS NDS OSD Level JCS Level DSR CPR Every 4 Years Guidance for POM/BES submission and OSD Program & Budget Review Planning Phase focus: Threat vs. Capabilities Update strategy Guidance for Programming & Budgeting PPBE – Planning Phase - Led by USD (P) YEAR 1FEB/MARElapsed Time: 15-16 Months YEAR 2 APR/MAY

PPBE - Program Review JUN JUL AUG SEP OCT NOV CAPE – Cost Assessment & Prgm EvaluationCPA – Chairman’s Program Assessment DEPSECDEF – Deputy Secretary of DefenseDoD – Department of DefenseDMAG – Deputy’s Management Action GroupDPG – Defense Planning GuidanceFYDP – Future Years Defense ProgramPOM – Program Objectives MemorandumPDM – Program Decision MemorandaSLRG – Senior Leader Review GroupSECDEF – Secretary of Defense Components/Defense AgenciesIssue ResolutionSECDEF / DEPSECDEFSLRG & DMAG POMCAPECPA JCSFYDPUpdate3-Star Group IssueTeams DoD“Large Group” PDM Program Review focus: Compliance with DPG

PPBE – Budget Review BES – Budget Estimate Submission FYDP – Future Years Defense ProgramMBI – Major Budget IssuesOMB – Office of Management and BudgetOSD – Office of the Secretary of DefensePEO – Program Executive OfficerPB – President’s BudgetPM – Program ManagerPBD – Program Budget Decision USD(C) – Undersecretary of Defense (Comptroller)Components/Defense AgenciesBESPB MBI USD(C) &OMBFYDP Update Services / PEO / PM Answer / Reclama DEC JAN FEBPBDsAdv Questions/OSD/OMB Budget Hearings Budget Review focus: PricingFunding policies PhasingBudget execution FYDPUpdate

Resource Allocation Process Budget. FY 18 Budget.FY 19

Congressional Enactment Timetable JAN FEB MAR APR MAY JUN JUL AUG SEP OCT COMMITTEE INPUTS 15 HRNGS MARKS FLOOR HRNGS MARKS FLOOR AUTHORIZATION APPROPRIATION BUDGET RESOLUTION CONF 15 PRES BUDGET “TARGET” FISCAL YEAR HOUSE SENATE HOUSE SENATE HOUSE SENATE SAC HRNGS MARK-UP FLOOR HAC HRNGS MARK-UP FLOOR SASC HRNGS MARK-UP FLOOR HASC HRNGS MARK-UP FLOOR FLOOR FLOOR ^ RESOLUTION ^ ACT CONF /RPT CONF /RPT FLOOR FLOOR FLOOR FLOOR ^ ACT BILL / RPT BILL / RPT BILL / RPT BILL / RPT ^

Below Threshold Reprogramming RDT & E APPRN MAX INTO MAX OUT LEVEL OF CONTROL OBL AVAIL Program Element 2 Years Line Item 3 Years SCN: 5 Years + $15 M + $10 M Budget Activity Project PROC MILPERS MILCON O & M Budget Activity (or Defense Agency) Some Sub-Activity Limitations on Decreases (see reference below) Reference Sources: DoDFMR 7000.14-R, Volume 3, Chapter 6 (Sep 2015) and Chapter 7 (Mar 2011) Lesser of - $10 M or - 20% No Specific Congressional Restriction Lesser of + $2 M + 25 % - $15 M No Specific Congressional Restriction 5 Years 1 Year 1 Year Amounts are Cumulative Over Entire Period of Obligation Availability Lesser of - $20 M or - 20% Lesser of + $10 M or + 20% Lesser of + $20 M or + 20%

  Years  1 2345 678910 11O&M          RDT&E           Procurement            Ships           MILCON          MILPERS             Appropriation Life Cycle Current Period: Available for new obligations, obligation adjustments, expenditures, and outlays Expired Period : Available for obligation adjustments, expenditures, and outlays Cancelled: Unavailable for obligations, obligation adjustments, expenditures, and outlays