E2. ENCLOSURE 2

ACAT AND MDA

E2.1. General. A technology project or acquisition program shall be categorized based on its location in the acquisition process, dollar value, and MDA special interest.

E2.2. Pre-ACAT Technology Projects. Advanced Technology Demonstrations, Joint Warfighting Experiments, Advanced Concept and Technology Demonstrations, Concept Refinement, and Technology Development occur prior to acquisition program initiation. The USD(AT&L) shall be the MDA for those projects that, if successful, will likely result in an MDAP. The ASD(C3I)/DoD CIO shall be the MDA for those projects that, if successful, will result in a MAIS.

E2.3. Table E2.T1. contains the description and decision authority for ACAT I through III programs.

Table E2.T1. Description and Decision Authority for ACAT I . III Programs

Acquisition Category	Reason for ACAT Designation	Decision Authority
ACAT I	MDAP (10 USC 2430, reference (n))) Dollar value: estimated by the USD(AT&L) to require an eventual total expenditure for research, development, test and evaluation (RDT&E) of more than $365 million in fiscal year (FY) 2000 constant dollars or, for procurement, of more than $2.190 billion in FY 2000 constant dollars MDA designation MDA designation as special interest	ACAT ID: USD(AT&L) ACAT IC: Head of the DoD Component or, if delegated, the DoD Component Acquisition Executive (CAE)
ACAT IA	MAIS: Dollar value of AIS estimated by the DoD Component Head to require program costs (all appropriations) in any single year in excess of $32 million in fiscal year (FY) 2000 constant dollars, total program costs in excess of $126 million in FY 2000 constant dollars, or total life-cycle costs in excess of $378 million in FY 2000 constant dollars MDA designation as special interest	ACAT IAM: ASD(C3I)/DoD CIOACAT IAC: CAE, as delegate by the DoD CIO
ACAT II	Does not meet criteria for ACAT I Major system Dollar value: estimated by the DoD Component Head to require an eventual total expenditure for RDT&E of more the $140 million in FY 2000 constant dollars, or for procurement more than $660 million in FY 2000 constant dollars (10 USC2302d, reference (o)) MDA designation4 (10 USC 2302(5), reference (p)) MDA designation as special interest	DoD CAE or the individual designated by the CAE
ACAT III	Does not meet criteria for ACAT II or above Less-than a MAIS program	Designated by the DoD CAE at the lowest level appropriate
Notes: 1. In some cases, an ACAT IA program, as defined above, also meets the definition of an MDAP. The USD(AT&L) and the ASD(C3I)/DoD CIO shall decide who will be the MDA for such programs. Regardless of who is the MDA, the statutory requirements that apply to MDAPs shall apply to such programs. 2. An AIS program is an acquisition program that acquires IT, except IT that involves equipment that is an integral part of a weapon or weapons system, or is an acquisition of services program. 3. The ASD(C3I)/DoD CIO shall designate programs as ACAT IAM or ACAT IAC. MAIS programs shall not be designated as ACAT II. 4. As delegated by the Secretary of Defense or Secretary of the Military Department

E2.4. The DoD Component shall notify the USD(AT&L) or the ASD(C3I)/DoD CIO when cost growth or a change in acquisition strategy results in reclassifying a formerly lower ACAT program as an ACAT I or IA program. ACAT-level changes shall be reported as soon as the DoD Component anticipates that the program is within 10 percent of the next ACAT level. ACAT-level reclassification shall occur upon designation by the USD(AT&L) or the ASD(C3I)/DoD CIO.

E2.4.1. The CAE shall request a reclassification of an ACAT I or IA program to a lower ACAT. The request shall identify the reasons for the reduction in category. The category reduction shall become effective upon approval of the request by the USD(AT&L) or the ASD(C3I)/DoD CIO.

E2.4.2. The USD(AT&L) or the ASD(C3I)/DoD CIO may reclassify an acquisition program as a pre-MDAP/MAIS or as an ACAT ID or IAM at any time.