Lawmakers direct SCO to establish pilot program to close capability gaps in 'high-priority theaters'

House and Senate lawmakers are directing the Pentagon's Strategic Capabilities Office to establish a pilot program oriented around broad missions to close significant capability gaps in "high-priority theaters" with funding sourced from private investment resources.

The SCO would act as the mission manager “to integrate any commercially provided mission capabilities with existing programs, systems, capabilities and processes necessary to implement mission solutions,” according to the compromise fiscal year 2022 defense policy bill.

The SCO would also develop metrics to assess the progress of the program and frequently report to Congress about whether to continue or expand the pilot program.

According to the joint explanatory statement, the pilot program would be oriented around broad missions or operational challenges like “maintaining the ability to conduct air operations from Guam or to conduct joint logistics and resupply missions, all amid rapidly worsening threats.”

The provision directs that funding for the pilot program would be sourced through private investment resources, like equity of venture capital, “and such capabilities should be used to integrate existing Department of Defense platforms and capabilities.”

“The pilot should be structured to accommodate and balance risks and rewards for both the government and the private sector,” according to the joint explanatory statement. “The private sector investors and performers would assume the risk of up-front investment in capability development and realizing substantial profit by solving hard problems at far less expense than the government could achieve by traditional program management processes.”

Additionally, the pilot program’s proof of efficacy must be demonstrated within three years “such that an operational capability can be delivered within [five] years.”