II 112th CONGRESS 1st Session S. 1736 IN THE SENATE OF THE UNITED STATES October 19, 2011 Mr. Brown of Massachusetts (for himself, Ms. Collins, and Mr. Lieberman) introduced the following bill; which was read twice and referred to the Committee on Homeland Security and Governmental Affairs A BILL To achieve cost savings through the reform of Federal acquisition practices and procedures.

1.

Short title; table of contents

(a)

Short title

This Act may be cited as the Acquisition Savings Reform Act of 2011. (b)

Table of contents

The table of contents for this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Definitions. Sec. 3. Use of reverse auction methods. Sec. 4. Federal Strategic Sourcing Initiative. Sec. 5. Savings through leveraging the Federal Government’s purchasing power. Sec. 6. Governmentwide contract vehicles. Sec. 7. Streamlining of contract closeouts. Sec. 8. Affordability as a requirement for certain acquisition plans. Sec. 9. Cost efficiency objectives for service contracts. Sec. 10. Establishing governmentwide acquisition savings criteria. Sec. 11. Office of Management and Budget savings requirements. Sec. 12. Expedited payment to small business.

2.

Definitions

In this Act: (1)

Approved business case

The term approved business case means a business case approved by the senior procurement executive of an executive agency. (2)

Acquisition

The term acquisition has the meaning given the term in section 131 of title 41, United States Code. (3)

Commercial item

The term commercial item has the meaning given the term in section 103 of title 41, United States Code. (4)

Executive agency

The term executive agency has the meaning given the term in section 133 of title 41, United States Code. (5)

Federal acquisition regulation

The term Federal Acquisition Regulation means the Federal Acquisition Regulation maintained under section 1303(a)(1) of title 41, United States Code. (6)

Federal Acquisition Regulatory Council

The term Federal Acquisition Regulatory Council means the Federal Acquisition Regulatory Council established under section 1302(a) of title 41, United States Code. (7)

Federal Strategic Sourcing Vehicles (FSSVs)

The term Federal Strategic Sourcing Vehicles means a kind of governmentwide interagency acquisition contract or agreement designated by the Office of Management and Budget to leverage the Federal Government’s buying power and save taxpayers money. (8)

Interagency contract

The term interagency contract— (A)includes— (i)governmentwide acquisition contracts as defined in Federal Acquisition Regulation part 2.101; (ii)multi-agency contracts as defined in Federal Acquisition Regulation part 2.101; (iii)Federal Supply Schedule contracts; and (iv)franchise funds; and (B)does not include contracts entered into under the authority of section 1535 of title 31, United States Code. (9)

Procurement

The term procurement has the meaning given the term in section 111 of title 41, United States Code.

3.

Use of reverse auction methods

Not later than 270 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation to require the heads of executive agencies, to the extent possible, to use online reverse auction, or an equivalent method, in the procurement of commercial items above the simplified acquisition threshold whenever doing so would be expected to result in savings to the agencies. The regulatory guidance shall address the circumstances in which use of reverse auctions is appropriate, and shall direct agencies, in deciding whether to use auctions or an equivalent method, to consider the dollar volume of the acquisition and potential to streamline the procurement for the agency and vendors.

4.

Federal Strategic Sourcing Initiative

(a)

Consideration in Acquisition Planning Process

Not later than 270 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation to require the consideration of Federal Strategic Sourcing Vehicles in the acquisition planning process, by including a listing of Federal Strategic Sourcing Vehicles in the Priorities for use of Government supply sources for Supplies and Services. The Office of Management and Budget shall maintain a website with the current list of Federal Strategic Sourcing Vehicles. The Supplies priority shall be after the priority for wholesale supply services. The Services priority shall be after services which are on the Procurement List maintained by the Committee for Purchase From People Who are Blind or Severely Disabled. The Federal Acquisition Regulation shall be amended to authorize purchases from other than from Federal Strategic Sourcing Vehicles, provided that consideration is given to its use in the acquisition planning process. The plan will be documented to acknowledge why usage of other than Federal Strategic Sourcing Vehicles is warranted. The acknowledgment shall indicate that such action is judged to be in the best interest of the Federal Government in terms of the combination quality, timeliness, and cost that best meets the requirement. Cost comparisons shall include the administrative cost of the acquisition. Unusual and compelling urgency as prescribed in the Federal Acquisition Regulation shall also be an authorized reason from deviating from the Federal Strategic Sourcing Vehicles. (b)

Maximization of small business and other socioeconomic categories in Federal Strategic Sourcing Vehicles

The Administrator for Federal Procurement Policy shall issue policy maximizing the participation of small business and other socioeconomic categories such as service-disabled veteran-owned small business in these Federal Strategic Sourcing Vehicles. Agencies shall also be credited towards their small business goals when awarding to small business Federal Strategic Sourcing Vehicle contract holders. (c)

Identification of Designated Federal Strategic Source Vehicles

The Office of Management and Budget shall identify on its website a list of all Federal Strategic Source Vehicle contracts and agreements and awardees. (d)

Inclusion of Information Technology Purchases and Services in Initiative

(1)

Data collection

The Director of the Office of Management and Budget shall prescribe regulations requiring Chief Information Officers and Chief Acquisition Officers of executive agencies to develop and gather such data on information technology purchases and service acquisitions by North American Industrial Classification codes. (2)

Annual report

The regulations prescribed under this subsection shall require the head of each executive agency to submit to the Director of Office of Management and Budget an annual report through fiscal year 2016 including the data collected under paragraph (1) and a plan for the strategic sourcing of information technology purchases and common commercial services. The plan shall include specific milestones, measurable savings, and evaluation criteria. (e)

Reporting

The head of each executive agency shall submit to the Director of the Office of Management and Budget an annual report for each of fiscal years 2013 through 2016, estimating the amount of savings achieved through the usage of Federal Strategic Sourcing Vehicles and through other measurable acquisition savings methods approved by the Administrator for Federal Procurement Policy. The report shall also specify by each Federal Strategic Sourcing Vehicle commodity what guidance the agency has issued to employees instructing them to procure goods or services through the Federal Strategic Sourcing Vehicle. If the agency has not issued such guidance to their employees, the agency shall submit an explanation.

5.

Savings through leveraging the Federal Government’s purchasing power

Not later than 120 days after the date of the enactment of this Act, the Director of the Office of Management and Budget shall develop a plan to achieve not less than $1,000,000,000 in measurable savings through Federal Strategic Sourcing Vehicles for fiscal years 2013 through 2016. The plan shall include an annual scorecard measuring the success of each executive agency in achieving savings.

6.

Governmentwide contract vehicles

Not later than 270 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation to provide that— (1)where an agency is unable to satisfy the requirements from a mandatory source, agencies are strongly encouraged to utilize Federal Supply Schedules, governmentwide acquisition contracts, multi-agency contracts, and any other procurement instruments intended for use by multiple agencies, including blanket purchase agreements (BPAs) under Federal Supply Schedule contracts absent a written justification that the governmentwide contract is not in the best interest of the Federal Government; (2)agencies shall promote acquisition strategies utilizing these vehicles to maximize participation of small businesses and other socioeconomic categories, including set-asides of acquisitions under these vehicles; and (3)contracting officers shall be encouraged by agency guidance to maximize competition under these vehicles to the maximum amount practicable with the goal of achieving the best value to the Federal Government.

7.

Streamlining of contract closeouts

(a)

Authority To waive contract closeout audits

(1)

Authority

Not later than 270 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation to provide contracting officers the authority to waive contract closeout audits above the simplified acquisition purchase threshold based on risk assessments. Factors upon which an assessment of low risk may include time and material contracts, low dollar cost type contracts, and contractors with approved business systems, strong internal controls, and good past performance ratings. (2)

Guidance

Not later than 270 days after the date of the enactment of this Act, the Administrator for Federal Procurement Policy, in collaboration with the Director of the Defense Procurement and Acquisition Policy, shall issue guidance for assisting contracting officials in determining when waivers of contract closeout audits pursuant to paragraph (1) are appropriate. (3)

Use of AbilityOne program

Where practicable, and in accordance with the Javits-Wagner-O'Day Act (41 U.S.C. 46 et seq.) as administered by the Committee For Purchase From People Who Are Blind or Severely Disabled, utilize the AbilityOne Program to accomplish non-inherently governmental tasks associated with contract or grant close-out in those cases where a Federal agency utilizes contractor support for close-out functions. (b)

Firm-Fixed contracts

Not later than 270 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation to provide that, on firm-fixed contracts— (1)contractors shall submit a final invoice within 60 days of Federal Government acceptance or relinquish payment unless exempted by the contracting officer; (2)the contracting officer may— (A)close a contract without a final invoice if the amount due is less than $1,000 and less than 10 percent of the contract value; and (B)unilaterally deobligate any unliquidated obligations remaining on the contract; and (3)such contracts may be closed with missing contract documentation if no additional product or service will be received by the Federal Government and there are no outstanding administrative actions. (c)

Authority To Write Off Unreconciled Balances for Low-Risk Contracts

Not later than 270 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation to provide contracting officers, with approval one level above the contracting officer concerned, the authority to write off unreconciled balances on low-risk contracts in cases in which— (1)all administrative actions are complete, including final payment to the contractor unless exempted under subsection (b)(1); and (2)a written notice of the action has been sent to the payment office responsible for the contract. (d)

Authority To grant exemptions

The regulations promulgated under this section shall permit the head of contracting activity to grant exemptions to the requirements under this section, with the exemptions included in the contract file. (e)

Contracting officer defined

In this section, the term contracting officer includes procuring and administrative contracting officers.

8.

Affordability as a requirement for certain acquisition plans

(a)

In general

Not later than 270 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation to require heads of executive agencies to mandate that affordability be included as a requirement for major systems, research and development, construction and architect-engineering acquisitions prior to the approval of any acquisition plan exceeding $100,000,000. (b)

Affordability defined

In this section, the term affordability refers to conducting an acquisition program at a cost constrained by the maximum resources that an executive agency can allocate for a particular capability.

9.

Cost efficiency objectives for service contracts

Not later than 270 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation to require service contracts valued at more than $100,000,000 include provisions to achieve productivity improvements and cost efficiencies. The regulation shall permit the head of contracting activity to grant exceptions to this requirement which shall be included in the contract file.

10.

Establishing governmentwide acquisition savings criteria

The Administrator for Federal Procurement Policy, in collaboration with the Director of the Defense Procurement and Acquisition Policy, shall establish at least one year from enactment a methodology to track and monitor progress made by executive agencies in achieving measurable acquisition savings. Measurable acquisition savings should include price reductions and cost savings through reduced acquisition costs such as administrative costs.

11.

Office of Management and Budget savings requirements

(a)

Plan for reduced use of time and materials contracts

Not later than 270 days after the date of the enactment of this Act, the Administrator for Federal Procurement Policy, in coordination with the Administrator of General Services and the Secretary of Defense, shall develop a plan for reducing the use of time and materials and labor hour contracts, including for orders under indefinite delivery/indefinite quantity contracts. (b)

Report on spending on management support service contracts

Not later than one year after the date of the enactment of this Act, the Administrator for Federal Procurement Policy, in collaboration with the Director of the Defense Procurement and Acquisition Policy, shall submit to Congress a report on reduced spending on management support service contracts.

12.

Expedited payment to small business

Not later than 270 days after the date of the enactment of this Act, the Federal Acquisition Regulatory Council shall amend the Federal Acquisition Regulation to reflect that governmentwide policy is to assist small business concerns by paying them as quickly as possible after invoices and all proper documentation, including acceptance, are received and before normal payment due dates established in the contract.