Limitations on off-shore performance of contracts

(a)

Limitations

(1)

In general

The Office of Federal Procurement Policy Act (41 U.S.C. 403 et seq.) is amended by adding at the end the following new section:

42.

Limitations on off-shore performance of contracts

(a)

Conversions to contractor performance of Federal activities

An activity or function of an executive agency that is converted to contractor performance under Office of Management and Budget Circular A–76 may not be performed by the contractor or any subcontractor at a location outside the United States except to the extent that such activity or function was previously performed by Federal Government employees outside the United States. (b)

Other Federal contracts

(1)A contract that is entered into by the head of an executive agency may not be performed outside the United States except to meet a requirement of the executive agency for the contract to be performed specifically at a location outside the United States. (2)The prohibition in paragraph (1) does not apply in the case of a contract of an executive agency if— (A)the President determines in writing that it is necessary in the national security interests of the United States for the contract to be performed outside the United States; or (B)the head of such executive agency makes a determination and reports such determination on a timely basis to the Director of the Office of Management and Budget that— (i)the property or services needed by the executive agency are available only by means of performance of the contract outside the United States; and (ii)no property or services available by means of performance of the contract inside the United States would satisfy the executive agency's need. (3)Paragraph (1) does not apply to the performance of a contract outside the United States under the exception provided in subsection (a). (c)

State contracts

(1)Except as provided in paragraph (2), funds appropriated for financial assistance for a State may not be disbursed to or for such State during a fiscal year unless the chief executive of that State has transmitted to the Administrator for Federal Procurement Policy, not later than April 1 of the preceding fiscal year, a written certification that none of such funds will be expended for the performance outside the United States of contracts entered into by such State. (2)The prohibition on disbursement of funds to or for a State under paragraph (1) does not apply with respect to the performance of a State contract outside the United States if— (A)the chief executive of such State— (i)determines that the property or services needed by the State are available only by means of performance of the contract outside the United States and no property or services available by means of performance of the contract inside the United States would satisfy the State's need; and (ii)transmits a notification of such determination to the head of the executive agency of the United States that administers the authority under which such funds are disbursed to or for the State; and (B)the head of the executive agency receiving the notification of such determination— (i)confirms that the facts warrant the determination; (ii)approves the determination; and (iii)transmits a notification of the approval of the determination to the Director of the Office of Management and Budget. (3)In this subsection, the term `State' means each of the several States of the United States, the District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, the Virgin Islands, Guam, American Samoa, and the Trust Territory of the Pacific Islands. (d)

Inapplicability of limitations

The limitations in subsections (b) and (c) shall not apply to procurement covered by the Agreement on Government Procurement of the World Trade Organization (as described in section 101(d)(17) of the Uruguay Round Agreement Act (19 U.S.C. 3511(d)(17))). (e)

Responsibilities of OMB

The Director of the Office of Management and Budget shall— (1)maintain— (A)the waivers granted under subsection (b)(2), together with the determinations and certifications on which such waivers were based; and (B)the notifications received under subsection (c)(2)(B)(iii); and (2)submit to Congress promptly after the end of each quarter of each fiscal year a report that sets forth— (A)the waivers that were granted under subsection (b)(2) during such quarter; and (B)the notifications that were received under subsection (c)(2)(B)(iii) during such quarter. (f)

Annual GAO review

The Comptroller General shall— (1)review, each fiscal year, the waivers granted during such fiscal year under subsection (b)(2) and the disbursements of funds authorized pursuant to the exception in subsection (c)(2); and (2)promptly after the end of such fiscal year, transmit to Congress a report containing a list of the contracts covered by such waivers and exception together with a brief description of the performance of each such contract outside the United States.

(2)

Clerical amendment

The table of sections in section 1(b) of such Act is amended by adding at the end the following new item:

Sec. 42. Limitations on off-shore performance of contracts

(b)

Inapplicability to States during first two fiscal years

Section 42(c) of the Office of Federal Procurement Policy Act (as added by subsection (a)) shall not apply to disbursements of funds to a State during the fiscal year in which this Act is enacted and the next fiscal year.