Industry urges acquisition reform and relief from regulatory burdens; continuing resolutions flagged as major harm

Industry witnesses told the committee layered regulations, long award timelines and funding uncertainty reduce competition and slow delivery of capability to the field.

Eric Fanning said the cumulative effect of risk‑mitigation policies has become "a greater risk than the combined mitigation" because they delay materiel to warfighters and disincentivize new entrants. He cited commercial contractors’ preference for faster commercial work when Department of Defense processes are slow and noted that prolonged continuing resolutions force small suppliers to burn cash reserves or exit defense contracting.

Members asked for specific fixes. Witnesses suggested raising thresholds for cost and pricing data, piloting faster authorities for certain technology classes, improving incentive structures for program offices and contracting officers, and ensuring that tools meant to attract nontraditional vendors do not lock them into the slow system once successful. David Norquist urged execution of already proposed FMS reforms and faster use of direct commercial sales pathways where appropriate.

A recurring theme was that CRs are distortive: witnesses said long CRs and repeated short‑term funding spurts create cash‑flow stress, interrupt new starts and lead firms to choose commercial work over defense. Fanning warned that CRs have a ripple effect through supply chains and that small firms are especially vulnerable.

Committee members asked for written specifics on programs or contract clauses that could be changed, and industry leaders pledged to provide follow‑up lists and suggested pilots for streamlined acquisition tracks.