S. 2135: Prototype to Production Act

This bill, titled the Prototype to Production Act, proposes modifications to the existing framework under which the U.S. Department of Defense (DoD) can conduct transactions related to prototype projects and follow-on production contracts. Below are the key points outlined in the bill:

1. Changes to Transaction Authority

The bill aims to enhance the authority given to specific officials for executing certain defense contracts by amending Section 4022 of Title 10 of the United States Code. The following changes are significant:

• High-Cost Transactions: It allows for the exercise of authority for prototype projects or subsequent production contracts if the expected cost exceeds $100 million. This authority can only be used upon a written determination made by the head of the contracting activity or designated agency heads, such as directors of specific military research agencies.
• No Delegation of Authority: The authority to determine and execute these transactions cannot be delegated to other officials, ensuring that senior officials retain responsibility for these significant expenses.

2. Definitions and Clarifications

The bill clarifies certain terms related to acquisition and contracting:

• Head of Contracting Activity: This is defined as officials responsible for managing acquisition organizations and who usually possess unlimited procurement authority.
• Follow-on Production: This refers to contracts aimed at further developing, testing, producing, deploying, or sustaining capabilities that were successfully prototyped previously under this authority.

3. Rapid Acquisition for High Priority Needs

A new provision introduced in the bill allows for a production transaction to be awarded quickly, even without competitive procedures, for proven technologies and systems that have already been demonstrated in a relevant environment. This can happen when there is a high-priority need for the military and it is justified in writing by the appropriate service or component acquisition executive.

Overall Impact

The modifications are aimed at streamlining the process for acquiring defense-related technologies and increasing the speed at which new capabilities can be brought to production and fielded for use by military forces. This can potentially enhance the military's responsiveness to urgent needs, especially in evolving combat situations.

Relevant Companies

• BA (Boeing Company) - Boeing is a major contractor for the U.S. defense sector and could be significantly impacted as the bill may streamline procurement processes for military technologies that it develops.
• LOCK (Lockheed Martin Corporation) - As a leading defense contractor, Lockheed Martin could benefit from faster procurement for projects that require rapid deployment and production.
• RTX (Raytheon Technologies Corp) - Raytheon might see an impact as the bill facilitates quicker transactions for technologies that are critical for defense purposes, which involves products they manufacture.