DoD releases long awaited policy on mid-tier acquisition

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After three years and a serious reprimand from Congress, the Defense Department finally released its guidance for the processes governing middle-tier acquisition.

The Dec. 30, 2019, instruction, signed by defense acquisition and sustainment undersecretary Ellen Lord, gives DoD agencies direction for when and how to use middle-tier acquisition, and explains leadership responsibilities for the contracting method.

The DoD guidance, at least temporarily, allays concerns from Congress and the Government Accountability Office about unclear oversight of middle-tier acquisition.

The document doesn’t really tell readers much more than is already known about the process, but rather codifies the way DoD uses it, and then leaves a large part of the way the method is used up to the individual defense agencies.

DoD explains that the Defense Acquisition University will create a companion guide in the near future to expand upon the guidance.

“The guidance validates a lot of the current process of how things are working,” Bill Greenwalt, senior fellow at the Atlantic Council told Federal News Network. “I think it took so long because DoD didn’t really know what to do with the authority. It’s not just this authority, its things like other transaction authority. They are ways of trying to go faster. I don’t think they really had it figured out.”

Within the actual document, DoD clearly identifies middle-tier acquisition as a “pathway intended to fill a gap in the defense acquisition system for those capabilities that have a level of maturity to allow them to be rapidly prototyped within an acquisition program or fielded, within 5 years of middle-tier acquisition program start. The middle-tier acquisition pathway may be used to accelerate capability maturation before transitioning to another acquisition pathway or may be used to minimally develop a capability before rapidly fielding.”

It establishes two pathways: one for rapid fielding and the other for rapid prototyping. It states that middle-tier acquisition programs should not exceed five years and discourages its use for major systems “intended to satisfy requirements that are critical to a major interagency requirement or are primarily focused on technology development, or have significant international partner involvement.”

DoD components will oversee their own middle-tier acquisition programs. The guidance puts the onus on the components to develop a merit-based process for the consideration of innovative technologies to meet the needs communicated by the military for both prototyping and fielding. That process will be used to validate the use of middle-tier acquisition.

Defense agencies are required to develop a succinct requirement document within six months of using the process.

The components are also in charge of developing a process to transfer a successful prototype or program to new or existing programs for production, fielding, operations and sustainment.

Already existing middle-tier acquisition programs will have 60 days to comply with the guidance.

The acquisition and sustainment undersecretary holds the authority to determine if a program is not suited for middle-tier acquisition.

Greenwalt said he is concerned the implementation of the guidance could create some bureaucracy that would slow the purposefully rapid acquisition method.

“This could be used to create a lot of excess bureaucracy and slow this thing down if it’s implemented in the wrong way,” Greenwalt said.

The middle-tier acquisition gained popularity in DoD after the 2016 defense authorization act gave the authority to the Pentagon.

GAO and Congress grew concerned about the process after DoD did not release any policy outlining clear responsibilities.

The Government Accountability Office released a report in June stating that, “DOD has yet to fully determine how it will oversee middle-tier acquisition programs, including what information should be required to ensure informed decisions about program selection and how to measure program performance. Without consistent oversight, DOD is not well positioned to ensure that these programs—some of which are multibillion dollar acquisitions—are likely to meet expectations for delivering prototypes or capability to the warfighter quickly.”

The 2020 defense authorization act told DoD it needed to release this guidance or Congress would withhold funds.

The law states 75% of 2020 funds would be cordoned off for any mid-tier acquisition program as well as operations funds for the DoD research and technology undersecretary, the DoD acquisition, sustainment undersecretary, the director of cost analysis and program evaluation and the operations of the military service acquisition executives if the guidance was not delivered.

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