ARCA Act of 2025
What changed between versions
The definition of 'major acquisition program' was raised from a single $250 million life-cycle cost threshold to a dual threshold of $1 billion total life cycle cost or $200 million annually (both inflation-adjusted). The separate 'non-major acquisition program' definition was eliminated.
The organizational structure was renamed from 'Acquisition and Innovation' to simply 'Acquisition.' The Deputy Assistant Secretary for Innovation role was removed entirely. A new Deputy Assistant Secretary for Acquisition, Program Management, and Performance was added with responsibilities spanning lifecycle management, requirements planning, programming/budgeting, policy, performance standards, governance, and workforce capability.
The reorganization section was expanded from a narrow transfer of contracting officers and consolidation of logistics to a one-year mandate to organizationally consolidate ALL acquisition, procurement/contracting, and logistics/supply chain activities across the entire Department (including VBA, VHA, and NCA) under the Assistant Secretary for Acquisition. A 90-day plan and briefing to Congress was added, with a clarification that physical relocation of employees is not required.
The entire 'other transaction authority' section (which allowed the Secretary to enter non-contract transactions with nontraditional contractors for research and innovation up to $5 million, with a 33% non-federal funding requirement and a 3-year sunset) was removed.
The 'advance market commitments' section (which allowed the Secretary to guarantee purchase of technologies or services addressing unmet health care needs at a predetermined price) was removed.
At least four Program Executive Officers were added, each overseeing major acquisition programs in a specific area (Medical, Information Technology, Professional Services, and Other). Each must hold level three project management certification from the Department, Federal Acquisition Institute, DoD, or an equivalent private sector body.
Major acquisition program managers are now appointed by the applicable Program Executive Officer rather than the Deputy Secretary. Managers must also hold level three project management certification. Several duties were removed (alternate requirements consideration, cost accounting standards compliance, workforce establishment, technology/production capacity checks) and new ones added (providing documentation to governance boards, developing resource requests).
A new section requires the Secretary to prioritize acquisition internship programs for hiring into entry-level positions, with annual participant numbers set at no fewer than 2x and no more than 4x the fiscal year 2025 level. The requirement terminates when the Secretary certifies the pipeline is sufficient.
A new section requires the Secretary to enter a memorandum of understanding with the DoD acquisition research center (established under 10 U.S.C. 4142(a)) to conduct a systems engineering analysis of the VA acquisition process, with a report to Congress within one year.
A new section establishes a standardized requirements development process for major acquisition programs exceeding $200 million annually or $1 billion in lifecycle costs. The process must incorporate data-driven needs assessments, stakeholder input, and iterative validation through independent verification and validation. New positions may not be created without a cost-benefit analysis validated by the Director of Cost Assessment and Program Evaluation.
Eligibility for independent verification and validation contracts was broadened to include experience with 'governmental or commercial health care organizations' (not just DoD-related work). A past performance requirement (satisfactory or better in CPARS) was added. A new prohibition bars the Secretary from accepting conflict of interest mitigation plans as a substitute for demonstrating no conflict.
The funding provision for independent verification and validation contracts changed from 'to the extent practicable' proportional contribution to a mandatory requirement that each organizational subdivision proportionally contributes amounts to fund its contracts.
The cost assessment section was dramatically simplified from a detailed multi-subsection framework (with deputy directors, independent cost estimation procedures, review of records, participation/concurrence/approval rights, and staff provisions) to a concise list of five responsibilities. A new requirement was added that the annual report must list all acquisitions where the independent cost estimate exceeded the budget request by more than 5 percent.
The operating and support costs report was changed from a one-time report (due one year after enactment) to an annual report required until December 31, 2028.
