[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2547 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 2547

  To require certain executive agencies to carry out a cost-effective 
 program for identifying any errors made in paying contractors and for 
        recovering any amounts erroneously paid to contractors.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 18, 2001

   Mr. Burton of Indiana (for himself and Mr. Armey) introduced the 
   following bill; which was referred to the Committee on Government 
                                 Reform

_______________________________________________________________________

                                 A BILL


 
  To require certain executive agencies to carry out a cost-effective 
 program for identifying any errors made in paying contractors and for 
        recovering any amounts erroneously paid to contractors.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Erroneous Payments Recovery Act of 
2001''.

SEC. 2. IDENTIFICATION OF ERRORS MADE BY EXECUTIVE AGENCIES IN PAYMENTS 
              TO CONTRACTORS AND RECOVERY OF AMOUNTS ERRONEOUSLY PAID.

    (a) Program Required.--The head of each executive agency that 
enters into contracts with a total value in excess of $500,000,000 in a 
fiscal year shall carry out a cost-effective program for identifying 
any errors made in paying the contractors and for recovering any 
amounts erroneously paid to the contractors.
    (b) Recovery Audits and Activities.--A program of an executive 
agency under subsection (a) shall include recovery audits and recovery 
activities. The head of the executive agency shall determine, in 
accordance with guidance provided under subsection (c), the classes of 
contracts to which recovery audits and recovery activities are 
appropriately applied.
    (c) OMB Guidance.--The Director of the Office of Management and 
Budget shall issue guidance for the conduct of programs under 
subsection (a). The guidance shall include the following:
            (1) Definitions of the terms ``recovery audit'' and 
        ``recovery activity'' for the purposes of the programs.
            (2) The classes of contracts to which recovery audits and 
        recovery activities are appropriately applied under the 
        programs.
            (3) Protections for the confidentiality of--
                    (A) sensitive financial information that has not 
                been released for use by the general public; and
                    (B) information that could be used to identify a 
                person.
            (4) Policies and procedures for ensuring that the 
        implementation of the programs does not result in duplicative 
        audits of contractor records.
            (5) Policies regarding the types of contracts executive 
        agencies may use for the procurement of recovery services, 
        including guidance for use, in appropriate circumstances, of a 
        contingency contract pursuant to which the head of an executive 
        agency may pay a contractor an amount equal to a percentage of 
        the total amount collected for the United States pursuant to 
        that contract.
            (6) Protections for a contractor's records and facilities 
        through restrictions on the authority of a contractor under a 
        contract for the procurement of recovery services for an 
        executive agency--
                    (A) to require the production of any record or 
                information by any person other than an officer, 
                employee, or agent of the executive
                agency;
                    (B) to establish, or otherwise have, a physical 
                presence on the property or premises of any private 
                sector entity for the purposes of performing the 
                contract; or
                    (C) to act as agents for the Government in the 
                recovery of funds erroneously paid to contractors.
            (7) Policies for the appropriate types of management 
        improvement programs authorized by section 5 that executive 
        agencies may carry out to address overpayment problems and the 
        recovery of overpayments.

SEC. 3. DISPOSITION OF RECOVERED FUNDS.

    (a) Availability of Funds for Recovery Audits and Activities 
Program.--Funds collected under a program carried out by an executive 
agency under section 2 shall be available to the executive agency, 
without further appropriation, for the following purposes:
            (1) To reimburse the actual expenses incurred by the 
        executive agency in the administration of the program.
            (2) To pay contractors for services under the program in 
        accordance with the guidance issued under section 2(c)(5).
    (b) Funds Not Used for Program.--Any amounts erroneously paid by an 
executive agency that are recovered under such a program of an 
executive agency and are not used to reimburse expenses or pay 
contractors under subsection (a)--
            (1) shall be credited to the appropriations from which the 
        erroneous payments were made that remain available for 
        obligation as of the time such amounts were collected, shall be 
        merged with other amounts in those appropriations, and shall be 
        available for the purposes and period for which such 
        appropriations are available; or
            (2) if no such appropriation remains available for 
        obligation at that time, shall be disposed of as provided in 
        subsection (c).
    (c) Other Dispositions.--Of the total amount collected under such a 
program of an executive agency that is to be disposed of under this 
subsection--
            (1) up to 25 percent of such amount may be expended by the 
        head of the executive agency for carrying out any management 
        improvement program of the executive agency under section 5; 
        and
            (2) the remainder of that total amount, including any 
        amount not expended under paragraph (1), shall be deposited in 
        the Treasury as miscellaneous receipts.
    (d) Priority of Other Authorized Dispositions.--Notwithstanding 
subsections (b) and (c), the authority under such subsections may not 
be exercised to use, credit, or deposit funds collected under such a 
program as provided in those subsections to the extent that any other 
provision of law requires or authorizes the crediting of such funds to 
a nonappropriated fund instrumentality, revolving fund, working-capital 
fund, trust fund, or other fund or account.

SEC. 4. SOURCES OF RECOVERY SERVICES.

    (a) Consideration of Available Recovery Resources.--(1) In carrying 
out a program under section 2, the head of an executive agency shall 
consider all resources available to that official to carry out the 
program.
    (2) The resources considered by the head of an executive agency for 
carrying out the program shall include the resources available to the 
executive agency for such purpose from the following sources:
            (A) The executive agency.
            (B) Other departments and agencies of the United States.
            (C) Private sector sources.
    (b) Compliance With Applicable Law and Regulations.--Before 
entering into a contract with a private sector source for the 
performance of services under a program of the executive agency carried 
out under section 2, the head of an executive agency shall comply 
with--
            (1) any otherwise applicable provisions of Office of 
        Management and Budget Circular A-76; and
            (2) any other applicable provision of law or regulation 
        with respect to the selection between employees of the United 
        States and private sector sources for the performance of 
        services.

SEC. 5. MANAGEMENT IMPROVEMENT PROGRAMS.

    In accordance with guidance provided by the Director of the Office 
of Management and Budget under section 2, the head of an executive 
agency required to carry out a program under section 2 may carry out a 
program for improving management processes within the executive 
agency--
            (1) to address problems that contribute directly to the 
        occurrence of errors in the paying of contractors of the 
        executive agency; or
            (2) to improve the recovery of overpayments due to the 
        agency.

SEC. 6. REPORTS.

    (a) Requirement for Reports.--Not later than 30 months after the 
date of the enactment of this Act, and annually for each of the first 
two years following the year of the first report, the Director of the 
Office of Management and Budget shall submit to the House Committee on 
Government Reform and the Senate Committee on Governmental Affairs, a 
report on the implementation of this Act.
    (b) Content.--Each report shall include--
            (1) a general description and evaluation of the steps taken 
        by the heads of executive agencies to carry out the programs 
        under this Act, including any management improvement programs 
        carried out under section 5;
            (2) the costs incurred by executive agencies to carry out 
        the programs under this Act; and
            (3) the amounts recovered under the programs under this 
        Act.

SEC. 7. RELATIONSHIP TO AUTHORITY OF INSPECTORS GENERAL.

    Nothing in this Act shall be construed as impairing the authority 
of an Inspector General under the Inspector General Act of 1978 or any 
other provision of law.

SEC. 8. PRIVACY PROTECTIONS.

    (a) Prohibition.--Any nongovernmental entity that, in the course of 
recovery auditing or recovery activity under this Act, obtains 
information that identifies an individual or with respect to which 
there is a reasonable basis to believe that the information can be used 
to identify an individual, may not disclose the information for any 
purpose other than such recovery auditing or recovery activity and 
governmental oversight of such activity, unless disclosure for that 
other purpose is authorized by the individual to the executive agency 
that contracted for the performance of the recovery auditing or 
recovery activity.
    (b) Liability.--Any person that violates subsection (a) shall be 
liable for any damages (including nonpecuniary damages), costs, and 
attorneys fees incurred by the individual as a result of the violation.

SEC. 9. DEFINITION.

    In this Act, the term ``executive agency'' has the meaning given 
the term in section 4(1) of the Office of Federal Procurement Policy 
Act (41 U.S.C. 403(1)).
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