[Senate Hearing 117-574]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 117-574

                   PATHWAYS TO PROCUREMENT INNOVATION

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                                HEARING

                               BEFORE THE

                              COMMITTEE ON
               HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE

                    ONE HUNDRED SEVENTEENTH CONGRESS


                             SECOND SESSION
                               __________

                              MAY 12, 2022
                               __________

        Available via the World Wide Web: http://www.govinfo.gov

                       Printed for the use of the
        Committee on Homeland Security and Governmental Affairs
        
        
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                               __________

                    U.S. GOVERNMENT PUBLISHING OFFICE
                    
50-844 PDF                WASHINGTON : 2023   
        


        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                   GARY C. PETERS, Michigan, Chairman
THOMAS R. CARPER, Delaware           ROB PORTMAN, Ohio
MAGGIE HASSAN, New Hampshire         RON JOHNSON, Wisconsin
KYRSTEN SINEMA, Arizona              RAND PAUL, Kentucky
JACKY ROSEN, Nevada                  JAMES LANKFORD, Oklahoma
ALEX PADILLA, California             MITT ROMNEY, Utah
JON OSSOFF, Georgia                  RICK SCOTT, Florida
                                     JOSH HAWLEY, Missouri

                   David M. Weinberg, Staff Director
                    Zachary I. Schram, Chief Counsel
                  Michelle M. Benecke, Senior Counsel
   Tiffany Ann Shujath, U.S. Department of Homeland Security Detailee
                Pamela Thiessen, Minority Staff Director
            Sam J. Mulopulos, Minority Deputy Staff Director
       Jeremy H. Hayes, Minority Senior Professional Staff Member
   Timothy Harris III, Minority Federal Emergency Management Agency 
                                Detailee
                     Laura W. Kilbride, Chief Clerk
                     Thomas J. Spino, Hearing Clerk


                            C O N T E N T S

                                 ------                                
Opening statements:
                                                                   Page
    Senator Peters...............................................     1
    Senator Portman..............................................     2
    Senator Carper...............................................    15
Prepared statements:
    Senator Peters...............................................    23
    Senator Portman..............................................    25

                               WITNESSES
                         Thursday, May 12, 2022

Soraya Correa, President and Chief Executive Officer, Soraya 
  Correa and Associates, LLC.....................................     4
Grant M. Schneider, Senior Director of Cybersecurity Services, 
  Venable LLP....................................................     6
Elizabeth Sullivan, President, Madison Services Group, Inc.......     8

                     Alphabetical List of Witnesses

Correa, Soraya:
    Testimony....................................................     4
    Prepared statement...........................................    27
Schneider, Grant M.:
    Testimony....................................................     6
    Prepared statement...........................................    31
Sullivan, Elizabeth:
    Testimony....................................................     8
    Prepared statement...........................................    37

 
                   PATHWAYS TO PROCUREMENT INNOVATION

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                         THURSDAY, MAY 12, 2022

                                     U.S. Senate,  
                           Committee on Homeland Security  
                                  and Governmental Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:15 a.m., in 
room SD-342, Dirksen Senate Office Building, Hon. Gary Peters, 
Chairman of the Committee, presiding.
    Present: Senators Peters, Carper, Hassan, Sinema, Ossoff, 
Portman, Scott, and Hawley.

            OPENING STATEMENT OF CHAIRMAN PETERS\1\

    Chairman Peters. The Committee will come to order.
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    \1\ The prepared statement of Senator Peters appears in the 
Appendix on page 23.
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    First I would like to thank our witnesses for joining us 
here today. Today's hearing will examine the state of Federal 
Procurement, consider ways to boost innovation in the 
procurement process, and address challenges that have put a 
tremendous strain on Federal contracting.
    A reliable and consistent procurement process is the key to 
ensuring that the Federal Government can effectively deliver 
its services to all Americans.
    Federal agencies depend on procurement professionals to 
place contracts efficiently, to ensure that government needs 
are being met, and that taxpayer dollars are being used 
effectively. But we also need a process that is innovative and 
a process that is nimble enough to adapt to changing needs and 
circumstances. In recent years, the amount of Federal dollars 
spent on contracts has steadily increased, driven in part by 
the need to acquire new technology, such as software, cloud 
computing, cybersecurity protections, and artificial 
intelligence (AI), products and services that we can only 
expect to become even more in demand as we move forward.
    At the same time, we face several challenges that have made 
the procurement process both difficult to manage, and difficult 
to navigate for companies hoping to do business with the 
Federal Government. These challenges include a shortage of 
procurement professionals, particularly those with expertise 
related to emerging technologies, along with steep barriers for 
new companies seeking their first Federal contract, and a 
diminishing domestic industrial base that can support the 
government's needs and requirements.
    Right now, procurement professionals are retiring at a 
higher rate than they can be replaced, which leaves few 
experienced staff available to train new recruits in the 
contracting field, and even fewer staff with the expertise and 
training needed to make increasingly complex technology 
purchases.
    I was pleased to work with Ranking Member Portman on 
bipartisan legislation to create a training program to help 
Federal employees responsible for purchasing and managing 
artificial intelligence technologies better understand their 
capabilities and their potential risks.
    But it is clear there is more we must do to ensure that 
government is at the cutting edge of new developments and that 
taxpayers are getting the most out of their hard-earned tax 
dollars.
    Frequently, agencies are challenged to work at the ``speed 
of relevance'' of the technology that they buy, and 
procurements that take years to complete cannot keep pace with 
the speed of technological developments. This leaves agencies 
with technology that is new to them but may already be obsolete 
for the job at hand.
    The pool of Federal contractors is also shrinking, 
particularly with regard to new and small companies. A recent 
Government Accountability Office (GAO) study of the Department 
of Defense (DOD) contracting found that, while DOD contracts 
with small businesses increased by 15 percent, the number of 
small businesses awarded those contracts decreased by almost 
half.
    A July 2021 Bipartisan Policy Center report noted similar 
concerns, with unique barriers that small businesses in 
particular face when trying to enter the Federal contracting 
process.
    New, small firms are a critical component of our industrial 
base, pioneering new innovations, strengthening the resiliency 
of the domestic supply chains, and creating good-paying jobs in 
communities across our country.
    I was proud to advance bipartisan legislation through this 
Committee that was signed into law earlier this year, called 
the Promoting Rigorous and Innovative Cost Efficiencies (PRICE) 
Act, which ensures that small and disadvantaged business owners 
are given a fair opportunity to compete for Federal contracts 
and continue to grow their companies.
    Today, I am very pleased to welcome a talented group of 
experts who can help us identify more effective solutions to 
address these ongoing challenges, and ensure that the Federal 
Government is able to better serve the American people.
    Thank you to the three of you for being here. We look 
forward to this discussion.
    Ranking Member Portman, you are recognized for your opening 
comments.

            OPENING STATEMENT OF SENATOR PORTMAN\1\

    Senator Portman. Thank you, Mr. Chairman. I appreciate the 
witnesses as well, and particularly Ms. Correa, thank you for 
your many years of service to the Department of Homeland 
Security (DHS). You were there at the inception and 
congratulations on your retirement.
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    \1\ The prepared statement of Senator Portman appears in the 
Appendix on page 25.
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    The United States government spends a lot of money each 
year from taxpayers on contracts for goods and services. In 
2020, that was about $665 billion, a 50 percent increase from 
just 2015. Some of this increase was due to the coronavirus 
disease 2019 (COVID-19)--we understand that--but not all of it. 
We have to wait and see what the contracting outcomes will be 
for this year as Federal agencies contend with skyrocketing 
inflation, because it is likely that drive the numbers up 
further. Procurement officials also face a lot of other major 
challenges in the areas of cybersecurity, which this Committee 
has spent a lot of time on, and also workforce, and the need to 
get more procurement officials into the government.
    I think we have to focus today on another issue which is 
``Buy American'', because that is where this Committee has 
taken a lead. We have to do what we can do to protect American 
jobs, and that starts by ensuring that tax dollars spent on 
American government procurement is not used to create jobs 
overseas when it can be used to create jobs here.
    I am grateful that one area that remains bipartisan is this 
``Buy American'' and Made in America approach. It has been the 
law for nearly a century, but Federal agencies have, in my 
view, granted too many waivers to ``Buy American''. Under 
current law Federal agencies may use domestic content waivers 
to purchase goods or services from foreign companies only in 
very limited circumstances, for example, when there is no 
American-made product available or it will significantly 
increase the cost. Federal agencies, however, in my view, 
overuse this waiver authority and until recently there was not 
an easily accessible, governmentwide system tracking the use 
and the abuse of these waivers. I am pleased we have made 
progress on that.
    The bipartisan BuyAmerican.gov Act is now law. That is my 
legislation with Senator Stabenow, which was part of the 
infrastructure bill, and the Administration has issued an 
Executive Order (EO) creating this public website, 
MadeinAmerica.gov. I am pleased to see that, which will help 
by, among other things, better identifying opportunities for 
American companies to be able to contract with the government. 
It mandates that any Federal agency requesting a waiver to Made 
in America requirements to publicly submit it for everyone to 
see. There may be American manufacturers unknown to the 
government that can meet these needs, and that is what this 
website will be helpful to provide. That transparency is good 
for American jobs.
    I also was pleased to work with Chairman Peters on 
something called ``Build America, Buy America.'' It is a title 
of the recently passed infrastructure bill as well. That title 
updated ``Buy American'' requirements to ensure all the money 
spent on infrastructure goes to American manufacturing and 
American workers, American steel as an example, which is made 
in Ohio. We also included the Make PPE in America Act part of 
that legislation. That requires personal protective equipment 
(PPE) critical to responding to a public health crisis here at 
home is made in America. When we talked to PPE manufacturers 
about re-shoring this production to America, the biggest thing 
we heard was we need long-term contracts to be able to make the 
investments, and that is in that legislation. The multi-year 
contracts as required in this legislation will give them the 
certainty they need to make these investments in the United 
States.
    Having passed all these laws, we might just say 2021 was 
the ``Year of Buy American''. These are really historic 
changes, particularly in the infrastructure bill, and this 
Committee should be proud of the work it has done on a 
bipartisan basis to improve these programs. Again, I thank the 
witnesses for being here. We look forward to your comments 
today and your ideas on improving the Federal procurement 
system further and making the government a smarter buyer on 
behalf of the American people.
    Chairman Peters. Thank you, Ranking Member Portman.
    It is the practice to the Homeland Security and 
Governmental Affairs Committee (HSGAC) to swear in witnesses, 
so if each of our witnesses would please stand and raise your 
right hand.
    Do you swear the testimony you will give before this 
Committee will be the truth, the whole truth, and nothing but 
the truth, so help you, God?
    Ms. Correa. I do.
    Mr. Schneider. I do.
    Ms. Sullivan. I do
    Chairman Peters. Thank you. You may be seated.
    Our first witness is Soraya Correa. Ms. Correa currently 
serves as President and Chief Executive Officer (CEO) of Soraya 
Correa & Associates, LLC, and was the former Chief Procurement 
Officer at the Department of Homeland Security. While at DHS, 
Ms. Correa was recognized for her advancement of acquisition 
innovation through the creation of the Procurement Innovation 
Lab (PIL), now regarded as a model within government. She has 
also served more than 40 years in Federal services at agencies 
such as the Naval Sea Systems Command (NAVSEA), General 
Services Administration (GSA), National Aeronautics and Space 
Administration (NASA), and DHS since its very inception. She 
was awarded the Presidential Rank Award for Distinguished 
Service in 2018, and has spoken widely on acquisition topics, 
including acquisition reform and securing the supply chain.
    Welcome, Ms. Correa. It is great to have you here. You may 
proceed with your opening remarks.

 TESTIMONY OF SORAYA CORREA,\1\ PRESIDENT AND CHIEF EXECUTIVE 
            OFFICER, SORAYA CORREA & ASSOCIATES, LLC

    Ms. Correa. Sir, thank you. Good morning, Chairman Peters, 
Ranking Member Portman, and other distinguished Members of the 
Committee. I appreciate the opportunity to appear before you 
today to discuss procurement innovation. After over 40 years of 
dedicated Federal service in the acquisition profession I 
retired in July 2021, as the Chief Procurement Officer (CPO) 
and Senior Procurement Executive at the Department of Homeland 
Security. My career spanned several Federal agencies and 
positions as both a procurement and program official.
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    \1\ The prepared statement of Ms. Correa appears in the Appendix on 
page 27.
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    Today I operate a small business supporting the acquisition 
process through the advice and consultation to professional 
associations, industry, and academia. My commitment to the 
profession and the improvement of the procurement process is 
demonstrated through the programs and initiative I implemented 
at DHS.
    Speak with any acquisition leader and they will highlight 
the challenge of recruiting, hiring, and retaining a well-
trained and experienced workforce. To address the challenge, 
the Federal Government needs to invest in the growth and 
development of the acquisition workforce. By that I mean create 
programs and initiatives to promote the profession, deliver the 
right training at the right time, and ensure career paths are 
clear.
    One area where we can improve is in creating consistency 
across the profession when it comes to certification standards 
and promoting the use of a common language for the profession. 
By doing so we can make acquisition careers more transferrable 
between government and industry and as a result grow the 
profession. I believe that the use of a common language will 
also make it easier for academic institutions to offer degree 
programs and for individuals to understand and appreciate the 
profession.
    However, certification and training is not enough. We need 
to develop the soft skills and provide on-the-job learning 
opportunities. While this is nothing new, I believe that 
today's acquisition professional needs to know how to 
communicate, collaborate, and cooperate with others and they 
need to be inquisitive, risk tolerant, and decisive. The best 
way to gain these skills is through on-the-job training where 
they can learn by doing.
    The establishment of intern programs is one of the many 
ways in which agencies can develop and grow their workforce 
while simultaneously providing technical, interpersonal, and 
leadership training. At DHS we established the Acquisition 
Professionals Career Program (APCP) to attract, train, and hire 
acquisition professionals. We also created a mentoring program 
for procurement personnel. Finally, we encouraged rotational 
job assignments and participation in specialized training and 
certification programs such as the Digital Information 
Technology Acquisition Professionals (DITAP) Program. Such 
initiatives create an environment where individuals feel 
appreciated and valued.
    I established the DHS Procurement Innovation Lab to inspire 
and motivate the acquisition workforce to put forth ideas on 
how we could simplify the procurement process, enhance 
outcomes, and ensure a more efficient and effective experience 
for industry and government. My goal was not to seek changes to 
statute or regulation but to identify and use all the 
flexibilities available in the Federal acquisition regulation. 
Our process was designed to test the innovation or idea and 
share what we learned across the acquisition community.
    Since then, several agencies have created procurement 
innovation organizations. Many of the innovative practices and 
techniques developed by the PIL and other agencies are found on 
the Periodic Table of Acquisition Innovations (PTAI), which is 
hosted on the Federal Acquisition Institute (FAI) website. 
Encouraging organizations to promote procurement innovation and 
sharing what they learn is essential to improving the process.
    Several agencies are also using artificial intelligence, 
robotic process automation, and other technologies to promote 
efficiency in procurement processes and enhance the customer 
experience. Such efforts need to be encouraged and shared 
across the Federal agencies.
    While at DHS I implemented discussion forums for 
traditional and non-traditional contractors to learn about DHS 
and share with us technologies, approaches, and innovations. 
Two of the most popular were the Strategic Industry 
Conversation and the Reverse Industry Day. At the Strategic 
Industry Conversation, officials shared with industry the 
challenges and opportunities that lay ahead. The Reverse 
Industry Day was a unique forum for industry to educate us on 
their business practices. Topics included what goes into 
preparing a proposal, why do companies protest, and how to buy 
certain technologies.
    These events provide information and generate ideas for 
improving processes and removing barriers to competition. I 
recommend we encourage agencies to create or participate in 
such events.
    In addition to exploring the flexibilities in the Federal 
Acquisition Regulatory (FAR), at DHS we had success in using 
special procurement authorities, including other transaction 
authority and the Commercial Solutions Opening Pilot (CSOP) 
program, to acquire innovative technologies and solutions. 
These authorities provide greater flexibility in the drafting 
of the contractual agreement since they are not subject to the 
FAR and enable organizations to acquire products and services 
from new or non-traditional contractors with specialized 
knowledge and expertise. I ask that you consider making such 
authorities permanent and expand these authorities for use by 
the Chief Financial Officer (CFO) Act agencies.
    Thank you again for the opportunity to appear before you 
today. I remain committed to the success of our Federal 
Government and the acquisition profession. I take this 
opportunity to express appreciation for my colleagues in 
government, industry, and academia, and a special thank you to 
the Committee for seeking solutions and providing the support 
this profession deserves.
    I look forward to your questions.
    Chairman Peters. Thank you, Ms. Correa, for your comments.
    Our next witness is Grant Schneider. Mr. Schneider 
currently serves as the Senior Director of Cybersecurity 
Services at Venable LLP, and served as the former U.S. Chief 
Information Security Officer (CISO) based out of the White 
House. Mr. Schneider led the establishment of the Federal 
Acquisition Security Council (FASC), an interagency body 
responsible for overseeing information and communications 
technology, supply chain risk management for the Federal 
Government as its first chair. He also held positions leading 
cybersecurity at the National Security Council (NSC), and 
acquisition-related positions in information technology (IT) 
resource management at the Defense Intelligence Agency (DIA).
    Mr. Schneider, welcome to the Committee. You may proceed 
with your opening remarks.

    TESTIMONY OF GRANT M. SCHNEIDER,\1\ SENIOR DIRECTOR OF 
              CYBERSECURITY SERVICES, VENABLE LLP

    Mr. Schneider. Thank you very much. Chairman Peters, 
Ranking Member Portman, Members of the Committee and your 
staff, thank you for the privilege to appear before you today.
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    \1\ The prepared statement of Mr. Schneider appears in the Appendix 
on page 31.
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    As mentioned, I have spent my entire 30-year career focused 
on our nation's security. This includes over 20 years at the 
Defense Intelligence Agency, seven of which as the Chief 
Information Officer (CIO). I then spent six years at the 
Executive Office of the President (EOP), including serving as a 
Senior Director for Cybersecurity Policy on the National 
Security Council staff, and most recently as the Federal Chief 
Information Security Officer.
    For the past 20 months I have been a Senior Director of 
Community Services at the law firm Venable, where I help our 
clients, both large and small companies, from across all 
sectors, enhance their cybersecurity programs through the 
development and implementation of risk management strategies, 
as well as assisting with the preparation, response, and 
recovery from cybersecurity incidents, including ransomware.
    I also have helped many clients who are struggling to 
navigate the acquisition and compliance regimes necessary to do 
business with the Federal Government. I want to thank the 
Committee for taking up the important issues related to the 
timely acquisition of goods and services by the government.
    My first exposure to procurement was in the mid 1990s, when 
I was a GS-8 or--9. I was the Defense Intelligence Agency's 
representative to a global contract for IT services to support 
the defense intelligence community (IC). I met the Air Force 
(USAF) representative, who was a colleague and would-be mentor.
    One day we were working the program and I made the comment 
that there was something in the contract that gave us great 
leverage over the contractor and it was going to be a great 
deal for the government. The Air Force representative looked at 
me and said, ``Look, son. The point of the contract is to 
create an environment where the government and industry can 
work together to accomplish and solve agency mission needs. It 
is not there for us to beat each other over the head about.''
    Through that program I experienced the mission success 
possible from a partnership between contracting officers, 
technologists, and the vendors. Unfortunately, many of the 
people I have met throughout my career still view government 
contracts as an adversarial tool rather than a collaborative 
opportunity.
    Federal agencies, like nearly all organizations today, are 
dependent on technology to develop and deliver critical 
services in support of our Nation. While these digital 
enhancements increase productivity, convenience, and access to 
services, they also present opportunities for malicious cyber 
actors who have demonstrated a willingness to exploit any 
system to achieve their objectives.
    This evolution to a more digital experience means Federal 
information technology investments are more critical than ever 
before, and as previously mentioned, the Federal Government 
invests a lot of money in information technology, over $90 
billion a year. Most of that money is spent on goods and 
services acquired through Federal procurement processes. 
Federal agencies need agility within the procurement system to 
leverage the innovative tools, technologies, and services 
available from the private sector.
    Here are some actions I think government can take to 
enhance procurement innovation.
    One, provider greater flexibilities for contracting 
officers to prioritize the mission needs of the government 
during procurement. This includes recognizing that time to 
market is a key metric for every acquisition.
    Two, establish partnerships between technology and 
acquisition professionals. I recommend creating joint teams of 
acquisition and technology individuals who can focus on mission 
delivery to address agencies' most pressing technology 
procurement needs.
    Three, develop procurement vehicles that allow for 
technical refresh throughout their lifecycle so new 
technologies can be made available to agencies without 
necessitating new procurement processes.
    Four, consider supply chain risks associated with goods and 
services in technology acquisitions. This includes the quality 
and provenance of the items being procured as well as the 
trustworthiness of the provider. Additionally, the government 
should take steps to ensure there is a trusted marketplace 
available for public and private sector acquisitions.
    Fifth, drive consistent compliance and security 
requirements across the Department of Defense and Federal 
civilian agencies' acquisition processes. DOD and civilian 
agencies are seeking many of the same innovative commodity 
technologies available in the private sector. However, 
divergence in compliance requirements increases costs to the 
private sector to develop and provide solutions to both 
communities.
    Thank you again for the opportunity to speak with you 
today, and I look forward to your questions.
    Chairman Peters. Thank you, Mr. Schneider.
    Our final witness is Elizabeth Sullivan. Ms. Sullivan 
currently serves as President of Madison Services Group Inc. 
(MSGI), a government relations firm focusing on government 
contracting, and leads various groups representing both small 
and midsize contractors.
    She recently led the formation of the Secure Supply Chain 
Consortium, a group of small and midsize Federal contractors 
that advice decisionmakers on difficult supply chain security 
problems such as recent efforts to restrict procurement of 
certain information and telecommunications equipment from China 
and the Department of Defense's Cybersecurity Maturity Model 
certification.
    Ms. Sullivan, welcome to our Committee. You may proceed 
with your opening remarks.

TESTIMONY OF ELIZABETH SULLIVAN,\1\ PRESIDENT, MADISON SERVICES 
                          GROUP, INC.

    Ms. Sullivan. Thank you. Chair Peters, Ranking Member 
Portman, and members of the Committee, thank you for the 
opportunity to testify today. My name is Elizabeth Sullivan and 
I am President of Madison Services Group. MSGI advocates on 
behalf of many segments of the small and midsize Federal 
contracting community. I am here today to discuss a key 
component of our procurement system, small businesses.
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    \1\ The prepared statement of Ms. Sullivan appears in the Appendix 
on page 37.
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    At MSGI, we believe practical business problems require 
practical policy solutions. I would like to thank the Chair for 
spearheading the bipartisan PRICE Act. This new law addresses 
the need for modernizing the Federal acquisition system and 
will be transformative for small business contractors around 
the country. It tackles one of the barriers to procurement 
innovation, effective utilization of small businesses.
    Let me say up front a common misconception is that small 
companies believe they will be given awards by the Federal 
Government. This is simply not true. Small businesses just want 
a fair shot to compete.
    The Federal procurement system adds additional layers of 
complexity. This is not to say that all acquisition regulations 
are problematic. However, a number of them should be 
streamlined. Challenges arise not just from the content of the 
rules but how the rules are promulgated. For example, the time 
lapse between FAR Council action and final rules published the 
Small Business Administration (SBA) can span up to seven or 
more years, causing confusion for all involved. I urge this 
Committee to require the FAR Council to issue its rulemaking 
simultaneously with the SBA.
    The Committee has expressed concern about the health of the 
industrial base, for good reason. On average, the Federal 
market loses five percent of small business entrants every 
fiscal year. Small companies are not just valuable prime 
contractors but often serve as subcontractors to large 
businesses. Since the government does not have a relationship 
with subcontractors these companies have very little leverage 
to remedy any problems that arise. Further, category management 
has accelerated the decline in diversity of vendors, with large 
dollar amounts held only by a few companies. Nearly one in 
every four Federal contract dollars is spent through large 
Multiple Award Contracts.
    As the focus of government spending shifts more toward 
innovation, small IT vendors play an important part in this 
ecosystem. Hampering their success, outdated North American 
Industry Classification System (NAICS) codes inhibit their 
ability to win work. In addition, how agencies determine best 
value can also prove to be problematic for small businesses. 
Best value does not always mean lowest price, and despite past 
congressional efforts, agencies are still using Lowest Price 
Technically Acceptable (LPTA) for many contracts.
    Small business offices at Federal agencies play an outsized 
role in supporting small business participation. Our experience 
is that they are under-resourced and cannot give individual 
attention to all the small businesses that request it. Yet 
agencies have been tasked with increasing the number of new 
contractors.
    Additionally, there is not enough attention given to 
understanding small business programs across government. I know 
firsthand that many women-owned small businesses (WOSB) spend a 
great deal of time explaining the WOSB program to contracting 
officers.
    Speaking of new entrants, the government relies on strong 
past performance when awarding a contract. Many times these 
requirements can result in a chicken-and-egg situation. The 
company can only get past performance by performing on the 
contract but cannot be awarded a contract unless they have past 
performance.
    A recent attempt at solving this issue was proposed on the 
new GSA Polaris procurement. The solicitation allowed small 
companies to rely on the past performance of the large company 
on their team. While good for new entrants, on the flip side 
allowing this use of past performance could also hurt more 
mature small businesses.
    I would be remiss if I did not point out the uncertainty in 
cybersecurity requirements that loom over small businesses. 
With the constantly evolving cyber standards for government 
contractors it can be challenging to remain compliant. I would 
encourage this Committee to evaluate civilian agency 
requirements, ensuring that they do not conflict with new DOD 
standards.
    In conclusion, small businesses are only asking for a fair 
chance to compete. Strengthening agency focus on small business 
programs, eliminating rulemaking discrepancies, shifting the 
buying environment away from category management, and 
clarifying governmentwide cybersecurity requirements builds 
resiliency of the industrial base.
    The topic today is of utmost importance to continuing COVID 
recovery and securing a sustainable, innovation acquisition 
environment.
    Thank you for the opportunity to testify today, and I look 
forward to answering your questions.
    Chairman Peters. Thank you, Ms. Sullivan. Thank you for 
your opening comments. Actually I want to pick up on the 
comment you made with small businesses and ask a question of 
all three of you. I will have Ms. Correa start and then you can 
elaborate more, as the final word in this question.
    I hear it all the time from small businesses. I was just at 
a forum at Wayne State University earlier this week, and 
particularly with minority businesses they are saying, ``We 
cannot get contracts because we have to first show that we have 
done well with a contract, that we cannot get, so it is 
impossible to actually get one.'' I think all of you agree that 
there is incredible innovation and dynamism in our small 
business sector and we want to help those businesses grow and 
prosper.
    My question to each of, and we will let you have the last 
word, Ms. Sullivan, because you brought up this issue in your 
opening comments, to just elaborate on, how can we remove this 
barrier? How can we expand opportunities for small businesses 
to get these contracts and to stabilize their business and 
provide great services to the Federal Government?
    Ms. Correa. It is all in the evaluation, sir, and that is a 
great question. It is all in the evaluation of the proposals. 
There is an inherent desire to try to rely on past performance 
and experience. What I have always said it experience is good, 
depending on what it is you need it for. If you need a brain 
surgeon you probably want them to have experience. If you are 
buying technology, it is probably not going to have a lot of 
experience because technology is changing on a recurring basis.
    Instead of focusing so much on experience and past 
performance I have always recommended let us test them. Let us 
bring them in, have them demonstrate what they do. Have them 
come talk to us, similar to what you do with interviewing a 
person. A lot of the techniques that we develop through the 
Procurement Innovation Lab were designed to do just that, to 
create greater confidence in the evaluators by having the 
opportunity to meet with companies, talk to them, perhaps test 
them, or have them come in and demonstrate how they would 
accomplish the work in the solicitation.
    Chairman Peters. Thank you. Mr. Schneider.
    Mr. Schneider. Yes, I think in addition to the test--I love 
that idea--is recognizing past performance done in a commercial 
setting. So past performance in government is not necessarily 
unique, and I agree it is a lot about the evaluation, and often 
the criteria is written so specific that you have to have had 
past performance, perhaps even at a bureau level within an 
agency, in order to even be considered for the acquisition, 
whereas past performance in commercial settings would also be 
perfect acceptable.
    Ms. Sullivan. I think that builds off the idea that we 
should not confuse new entrants in the Federal market with new 
companies. I think that is a lot of the time what the 
acquisition workforce thinks of with small businesses--oh, they 
must have just started the businesses. A lot of these are very 
successful commercial companies.
    I do think, to address what you had said, Senator, having 
goals that are internal to the agency, to kind of move the 
needle for new entrants, that can be a way to incentivize 
agencies to utilize these new entrants that may not have the 
past performance. Also I think the Small Business 
Administration district offices could be really powerful 
feeders for non-traditional contractors that come to them and 
connect them to different agencies that might have those 
specific mission needs that need to be met.
    Chairman Peters. Thank you. Ms. Correa, I understand that 
recruiting and retention of procurement staff is clearly a 
chief concern among Federal agencies all across the board. With 
procurements becoming ever more complex we need trained, we 
need experienced workforce, and I understand agencies are 
continually recruiting contracting officers from each other in 
an attempt to maintain staffing. A little bit of poaching going 
on back and forth.
    My question to you is how can the Federal Government ensure 
that it has enough trained professionals? What do we need to be 
doing now, and what do we need to be doing differently?
    Ms. Correa. Thank you. That is a magnificent question. It 
is something that I am passionate about. First, we have to put 
the right leadership in place, people who really understand the 
profession, understand what makes people tick, and are willing 
to support their individuals, that are supposed to champion 
this workforce and enable to take the right risks and do the 
right thing.
    But the most important thing that I would emphasize is 
helping people understand what this profession is really about. 
People do not always come into this profession because what 
they read about is the bad-news stories that are out there in 
the press. They do not hear about the good news, the things 
that we do very well, including the lives that we save through 
the procurements that we make, the things that we do to enable 
the mission. We talk about procurement in terms of contracting 
and administrative processes, and we do not talk about the fact 
that what procurement does is enable the mission. We buy the 
products and services that our first responders, our 
warfighters, and others use. We need to learn how to talk to 
people.
    The other thing that I would say is we have to get into the 
colleges, the universities, and I daresay, high schools, and 
start talking about the profession. We need to bring in people 
at the very beginning, help them see the career path and 
understand what this mission is.
    I came into the government as a clerk typist, and I took my 
first procurement job at the Department of Navy, and I was 
hooked. I was hooked because my job was diving and salvage, and 
it was about people's lives and the livelihood of people, and I 
have never forgotten what mission is about. We need to talk 
that way. We need to promote the right leadership in the 
organization, and we need to create programs.
    I talked about intern programs. Intern programs are a great 
way to bring people on board and educate them. I do think we 
need to cross-train people. It is important. I took the 
opportunity to go into the program side, program management, 
and work in IT for a while, so I understand what IT is and how 
they think and what they look at and what program officials 
think.
    In short, I would say we have to invest in the profession, 
and I do mean invest--invest in training, invest in 
recruitment, but most importantly we have got to get the right 
leaders in place to go out there and talk to people and bring 
them.
    By the way, it was not a little bit of poaching, it was a 
lot of poaching. Just thought I would mention that.
    Chairman Peters. Good. Thanks for that clarification there.
    Let me pick up on the cross-training aspect. Mr. Schneider, 
with your own experience has a technical expert working on the 
procurement team, what are your thoughts about cross-training? 
Should we be doing more of that IT knowledge with folks with 
procurement backgrounds?
    Mr. Schneider. Yes. I think we should be realistic in what 
that is going to get us. I think, in general, it is going to 
get us awareness, and it is going to help people from each 
community who are cross-trained kind of issue spot and 
recognize issues and be able to adapt and react to them.
    But I think we really need the collaborative teams, working 
together, both focused on the mission outcomes that Soraya 
talked about, to really be able to have that interest in the 
agency outcomes and be able to learn from each other at a more 
organic level than kind of awareness training will do.
    Chairman Peters. Great. Thank you. I am going to need to 
step away briefly. I have an Senate Armed Services Committee 
(SASC) going on downstairs where I will be asking some 
questions. I will temporarily pass the gavel over to Senator 
Carper. But before Senator Carper gets that gavel I will 
recognize Ranking Member Portman for his questions.
    Senator Portman. Thank goodness, because you never know 
once Carper gets that gavel what he might do with it. 
[Laughter.]
    I have seen him in action.
    Thank you all again for your work on the procurement front. 
Not always, as Ms. Correa kind of suggested, the best image 
people think procurement and sometimes their eyes kind of glaze 
over. I taught a course in procurement when I left the Office 
of Management and Budget (OMB), and many of my students' eyes 
sort of glazed over.
    But by the end of the course I think they understood that 
it really is essential, both for the proper use of our taxpayer 
dollars and also you can do amazing things for the small 
businesses, in particular, when given an opportunity to work 
with government. Obviously we want the best, best for the 
services that we provide.
    One of the programs that I have concerns about is called 
Federal Risk and Authorization Management Program (FedRAMP). It 
is basically kind of a preclearance program for cloud services, 
and Mr. Schneider, you know a lot about this. I think it has 
weaknesses that make it vulnerable to foreign-based threats 
targeting our cloud systems. That would include China and 
Russia, by the way, in terms of some of these threats. The 
Senate unanimously passed our bill called Strengthening 
American Cybersecurity Act, which would address some of these 
issues.
    Mr. Schneider, have you looked at that legislation and do 
you think it would be helpful?
    Mr. Schneider. I am not intimately familiar with the 
legislation. However, I certainly agree with you that the 
FedRAMP program has some very good intentions. It certainly has 
some room for improvement there, and I think that we have to 
consider supply chain risk management in all our acquisitions, 
whether it is for cloud services or any other services that we 
are getting, and really come up with consistent ways that we 
can evaluate a vendor, again for quality of product and 
trustworthiness of the vendor themselves and potentially any 
legal oversight that their host country could put upon them.
    Senator Portman. I think it is really important that we 
have these reforms to protect these cloud-based systems, and my 
hope is that the House will take it up and it be properly 
implemented.
    What do GSA and FedRAMP programs need to do to attract 
small and innovative technology companies to become FedRAMP 
certified and to provide services to the Federal Government?
    Mr. Schneider. I think the struggle with small businesses 
and working to help some small businesses go through that 
process, it is a very intensive and expensive process to get 
through that has a lot of compliance. I think the Program 
Office at GSA needs to be bigger, it needs to be better 
resourced to be able to work with more companies. I think they 
need to seek ways to reduce the burden and reduce the amount of 
paperwork associated.
    I think it also goes to being able to evaluate companies 
for their security outcomes as opposed to just for their 
security paperwork. The processes, they certainly need to have 
processes in place. But we need more flexibility on how you can 
meet the security outcomes for all businesses, small and large.
    Senator Portman. That is one of our goals here, and my hope 
is that this legislation can pass to help protect the cloud-
based services but also we can expand the number of companies 
that are innovative technology companies that will provide that 
service.
    On the Buy American laws, we talked about it in my opening 
Statement quite a bit, but bottom line is we are spending more 
and more money on goods being manufactured around the country, 
but also $34 billion was spent on goods manufactured by foreign 
firms in the last five years. The Department of Defense the 
largest purchaser of manufactured goods in the world, has spent 
over $200 billion on foreign products since 2007. Of course, we 
have lost manufacturing jobs during that time period.
    Ms. Correa, talk about that a little bit if you would, and 
maybe one thing that would be interesting, I think, for people 
to hear is what steps does a contracting officer go through in 
determining whether or not to apply for a waiver of our Buy 
American laws?
    Ms. Correa. Sure. Certainly. Thank you. Thank you for the 
question.
    The Buy American Act is a little bit challenging because 
you have to look at it in conjunction with other legislation 
such as the Trade Agreements Act and a couple of other 
legislations.
    Generally speaking, what a contracting officer has to do 
is, first of all, they have to make sure they are incorporating 
the right clauses in the contract, but they also have to look 
at the product and determine if that product is available by 
American manufacturers. That is done in a number of ways. They 
can publish it out in the Federal Biz Opps (FedBizOpps), the 
publication that tells contractors that we are interested in 
certain products and services.
    Typically what agencies do on an annual basis is identify 
all those products that they buy from foreign manufacturers and 
publish them so that companies out there can tell us if they 
can make those products or if they are interested in selling 
those products to the government.
    What I have seen is that typically when certain agencies 
are buying things like aircraft parts, parts of ships, it 
depends what engine they bought, and if that engine was bought 
by a foreign manufacturer then you are probably going to have 
to buy the parts from that manufacturer. That is what I have 
typically seen.
    At DHS, one of the things that I did to improve compliance 
with Buy American Act--and I did this probably about six years 
ago, when I was well into the job--was I raised the threshold 
for review. Instead of leaving it at the head of contracting 
level it came to my level to review any waivers for Buy 
American Act. That seemed to cut down the number of the 
waivers, but it also made us more conscious of what people were 
buying and how they were buying.
    But generally speaking the process is they do have to look 
to see if there are American manufacturers out there. They do 
have to announce that they intend to buy this product from 
Company XYZ, whoever they may be, so that companies can come in 
and tell us that they manufacture the product.
    I do want to add that I think some of the recent efforts 
that OMB has undertaken to take a closer look at Buy American 
compliance, I think those processes will work. I think 
compliance varies by agencies, based on what they buy and how 
they buy.
    Senator Portman. Yes. As I said earlier, 2021 was sort of 
Buy America year. We had historic reforms to Buy America Act 
and expanding it, and again, I am pleased that the Executive 
Order has been issued with regard to BuyAmerica.gov website, 
which is kind of a clearinghouse, as you say. That is needed to 
let people know both on the private side what the opportunities 
are but also to let government contracting officers and 
procurement officers know that there is a business out there 
that can provide this, and sometimes that is lost.
    Do you think that the transparency and the clearinghouse 
element of BuyAmerica.gov can be successful in expanding the 
use of U.S. manufacturers?
    Ms. Correa. Yes, I do believe that it can be successful but 
I also think we have to do something a little bit more 
practical, and that is we need to get out there and talk to 
industry. We need to go out and understand why industry perhaps 
is not interested in selling certain products or manufacturing 
certain products in support of government needs.
    A lot of times it has to do with the lack of guarantees in 
the contracts. I think Elizabeth mentioned that in her 
testimony, that sometimes these contracts, the way they are 
written, the companies does not know when they are going to 
recover their costs, if they are going to recover their costs. 
There are upfront investments the companies have to make if 
they are going to go into the manufacturing of certain 
products. I think that is extremely important.
    This all ties back to something that Grant said, and that 
is we have got to build cohesive teams that plan the 
procurement properly to think about all these factors, whether 
it is cybersecurity, FedRAMP certification, Buy American. When 
you build that team up front and you put it on the front end of 
the question, you are going to write a much better 
solicitation, you are going to engage in a much better 
procurement process, and you are probably going to be bringing 
industry in a lot earlier to talk about what you are thinking 
about doing so they can get some input.
    I am a huge advocate of the coordinated teams, but you have 
to get them up front.
    Senator Portman. Expediting the process so that it moves 
more quickly, because we are moving at faster and faster speeds 
in our economy, and particularly with inflation have a real 
challenge right now to ensure we are spending that taxpayer 
dollar most efficiently.
    Senator Carper, when I taught this procurement class it was 
at the Ohio State University (OSU), at the Glenn School, now 
Glenn College, your alma mater, and named after the former 
Chairman of this Committee. Mr. Chairman.

              OPENING STATEMENT OF SENATOR CARPER

    Senator Carper [presiding.] Ohio. I am a Navy Reserve 
Officers' Training Corps (ROTC) midshipman, Ohio State 
graduate. I graduated in 1968, at the height of the Vietnam 
War, and headed over there to do three tours later on. I am 
happy to be here to serve with Senator Portman and our 
colleagues.
    This first question is sort of light-hearted. I do remind 
you all that you are under oath.
    Ms. Correa, 40 years or more in service, and Mr. Schneider, 
I think 30 years or more. Was your hiring all those years ago 
in violation of child labor laws of this country? [Laughter.]
    Ms. Correa. I wish.
    Mr. Schneider. Sadly not.
    Senator Carper. OK. All right.
    First of all, this is a great hearing. You are wonderful to 
come and join us.
    On a panel like this, where sometimes we have witnesses 
where it is an adversarial environment and we just kind of go 
at it with each other, but that is not the case here. I think 
there is a fair amount of consensus.
    I would just start with you, Ms. Correa. Give us one or two 
examples where you think this panel actually agrees on ideas 
that we really ought to take to heart. Would you give us one or 
two great ideas for consensus?
    Ms. Correa. I believe in investing in the acquisition 
workforce. That is the most important thing. If we do not 
invest in the people you cannot fix the process. The people 
will fix the process.
    I stood up the Procurement Innovation Lab. I think that is 
the right way to go. What we have to do is develop these people 
so they become the kind of leaders that say, ``We are going to 
champion what you do. We are going to stand with you and we are 
going to let you take certain risks, and we are going to 
support you.'' Understanding that when you take risks that 
means that we might fail once or twice. But failure can be a 
good thing because we learn from failure. We get up, we dust 
ourselves off, we figure it out, and try again.
    That is what I encouraged in my office, and that is what I 
talked about, and I rewarded people who took risks, even when 
it did not go well. I gave them awards and I recognized them 
for trying something new.
    The other thing that I would say is the authorities, the 
flexibilities in the Federal acquisition regulation. There are 
many there. We just have to understand them and we have to be 
able to interpret them. We have to learn to talk to one 
another. Often I hear procurement personnel say, ``The lawyer 
would not let me do it.'' I never had a lawyer stop me from 
doing anything I wanted to do. I knew how to talk to them. I 
knew how to approach them and say, ``Here is what we are trying 
to do. Get me there.''
    Senator Carper. I like to say, ``'No' means find another 
way.''
    Ms. Correa. Then the other thing that I did also was I 
stood up for the position that I was in. It was my job to 
ultimately make the decision. The lawyers are there to advise. 
Sometimes I was willing to take the risk, document the file on 
that risk, and move on.
    I think these are the kinds of things that we need to be 
encouraging in the workforce. The partnerships with the program 
offices, I was very candid with my program offices when I 
thought they were trying to do something that was not going to 
work, but I tried to give them options, to understand what was 
available.
    But the most important thing we can do is put the right 
leaders in, investment in this acquisition workforce, get them 
as young as we can. Look at me. I came in as a little kid--no, 
just kidding. But bring them in as young as we can. Let's go 
start talking to them at high school. Let them think about a 
career in acquisition. I think promoting a common lexicon, a 
common way of describing the profession and what we do, so that 
industry and government can share in resources. There are a lot 
of brilliant people in industry that I brought into the 
government, and there are a lot of brilliant people in 
government that went out to industry, and I think that is an 
important thing to do.
    Senator Carper. Good. Thank you very much for all that.
    Mr. Schneider, do you agree with anything that Ms. Correa 
has said?
    Mr. Schneider. Yes. I really agree with that many 
flexibilities exist in the FAR today. Whenever people ask me 
about acquisition reform, and if you tell them you want a 
particular thing it probably exists. The challenge is, quite 
frankly, finding a contracting officer or a team who feels 
empowered to leverage and implement and use some of those 
flexibilities.
    I think we need to talk to contracting officers and to the 
teams about their role with risk management as opposed to their 
personal liability if they decide to leverage one of those 
flexibilities and how they are going to have to explain it to 
an Inspector General (IG) or to GAO after the fact.
    Some ability to go to their leadership, hopefully someone 
as wonderful as Soraya, who is going to support them and 
support their ability to focus on the mission needs I think is 
absolutely critical.
    Senator Carper. Good. Thanks. Ms. Sullivan, do you agree 
with anything that either of these two people have said?
    Ms. Sullivan. I agree with both of my fellow panelists. I 
think that empowerment is really important, especially with 
respect to utilizing small businesses. DHS is a fantastic 
example of an agency who is willing to engage with small 
businesses, to use those innovative solutions, where a lot of 
times, agencies just will not.
    I would say, on the use of other authorities, such as Other 
Transnational Authority (OTAs) that was mentioned, something 
that might be of interest is figuring out how are small 
businesses able to access consortia? Are there any barriers 
there? If Congress could look into that I think that would be 
really useful to help see if we can get more small businesses 
contracts via those flexible authorities.
    Senator Carper. All right. Thank you.
    Let me go back to Mr. Schneider for this question, and I 
think I have time maybe for one more. As you know there is 
critical need--we have been talking about the need to modernize 
information technology systems across the Federal agencies. For 
as long as I have been here we have been talking about this, 
and to some extent doing it. It is important to both improve 
the security of our systems and to ensure that the Federal 
Government can serve the people we work for more effectively 
and more efficiently.
    From your perspective, what are the greatest challenges? 
From your perspective, what are the greatest challenges to 
agencies and their components to successfully investing in 
technology modernization efforts?
    Mr. Schneider. Senator, that is a great question, and I 
feel like I have been chasing that much of my career. To your 
point, I think there have been lots of successes. However, 
technology modernization is something we never achieve. It is 
something we are always going to be moving toward.
    I think one of the opportunities we have today--and 
certainly as Senator Portman mentioned there are some risks 
with cloud capabilities and we need to understand the security 
risks there--as agencies move toward cloud technologies they 
are no longer buying the next decade's legacy system. They are 
actually moving to a system where industry that has and brings 
a lot of capability and innovation, is going to do the 
evolution and the sustainment and the modernization of kind of 
the underlying technologies, and the government can work toward 
just having to modernize at more the application layer.
    I think there are some opportunities moving forward, but it 
also is going to take agencies to make some tradeoffs and to 
decide to kill some systems that need to go away and should no 
longer continue to be sustained.
    Senator Carper. Part of what you said reminds me of the 
Preamble of the Constitution. ``We the People, in order to form 
a more perfect union.'' It does not say ``perfect.'' It says 
``more perfect.'' The idea is that we realize we are always at 
places where we can do better, and the idea is to move toward 
that more perfect union, or more perfect approach to 
technology.
    I think Senator Peters may be en route to the airport to 
fly back to Michigan, and so I get to chair this Committee now 
for the next several weeks. [Laughter.]
    But I am happy to yield back to Senator Portman, for 
whatever he would like to ask.
    Senator Portman. Thank you, Mr. Chairman. You chair so many 
committees, I do not know if you would have time to chair 
another.
    With regard to workforce, we talked earlier about the 
challenge that you are facing, and let us face it, pretty much 
every sector of our economy is facing it right now, the private 
sector and public sector. With unemployment at under three 
percent and competition for talented workers being more intense 
than ever, I am concerned that the Federal Government is going 
to have even a harder time hiring individuals with private 
sector experience to help the acquisition system work better, 
because I think it is very helpful to have the private sector 
coming in and helping our government to be able to recruit 
people who understand the needs on both sides of the table, the 
private sector of companies that we want to engage more in 
procurement and the government side.
    My question to you would be this. What can we do to make 
sure that we are competitive? What could we do better? Ms. 
Correa, why don't you start off since you have been looking at 
this question over many years, and you have seen times when it 
is easier and times when it is harder.
    Ms. Correa. That is a great question and I want to mention 
first the hiring process is painful, and I think you have heard 
that before from other sides of the house, from the human 
resource (HR) folks in government. We have to modernize our 
hiring process. It takes too long to hire people. I literally 
had to authorize overhires, meaning telling my folks to hire in 
excess of the budget, meaning go out and recruit people, 
because we know we are going to lose people. That way we have 
people sitting on the bench ready to come in.
    I should not have to do that. I should be able to run a 
process where I can go and pick up people. I need a talent 
individual and I should be able to go and say, ``Hey, 
Elizabeth, come join my team. Here is what you applied for. Let 
us look at this resume and let us get her on board.'' We do not 
move that fast. Even with direct hire authority--you will hear 
about direct hire authority--you have to go through a lot of 
rules and reports and statistics to justify using that 
authority that has been given to us.
    I think therein lies the problem. We have to have a better 
process, but then again, I revert back to what I said earlier. 
We have to put the right leaders in place that know how to do 
this, that know how to motivate a workforce. When I came to the 
headquarters of Homeland Security to run one of the first 
offices that I ran, which was the Office of Procurement 
Operations, we had 60 people on board. I was authorized 250 
people, and I needed to hire quickly. I got 250 people on board 
in less than two years, but that is because I marshaled the 
troops, and we went out there and recruited. But it is hard to 
do with the current processes that are in place.
    Senator Portman. I think that is a great point. We hear, in 
this Committee, despite some of the improvements we tried to 
make, like direct hiring--and by the way, some of it is agency 
by agency; I think it should be governmentwide--but we hear 
people telling this story about having found somebody talented 
and the person, after two or three weeks of waiting, gets an 
office from the private sector. The private sector says, ``We 
will hire you tomorrow with benefits, ready to go,'' and they 
say, ``I would love to join the government and have done some 
public service here but I cannot wait four, five, or six 
months. I have to move.'' I think that is a disadvantage that 
we have.
    Senator Peters is now back and I will let me ask questions, 
but anybody, Ms. Sullivan or Mr. Schneider, any responses to 
the hiring dilemma?
    Mr. Schneider. Yes. One thing I would like to add and 
really highlight something Soraya mentioned earlier, I think we 
also need more flexibility to have people move in and out of 
government in these rules. It is difficult for people, and we 
need good, strong ethics rules, but sometimes they are a 
barrier, for many government jobs but especially for 
contracting officers who get excluded from being able to work 
at lots of companies, or if they work at a company are excluded 
from working back in the government. I think we will be able to 
retain more people if we can allow them more flexibility to 
move back and forth between industry and government, and gain a 
whole bunch of expertise at the same time.
    Ms. Sullivan. I would just add, if I can, that small 
business offices at agencies are under-resourced, and they are 
incredible tools to be able to get some new small businesses 
into the government, keep small businesses providing innovative 
products. So making sure that there are enough resources for 
those offices is incredibly important.
    Ms. Correa. May I add something to that----
    Senator Portman. You may.
    Ms. Correa [continuing]. Because Elizabeth raises a very 
important point. At DHS I think we were successful because we 
partnered with our Office of Small and Disadvantaged Business 
Utilization, and I carved out positions from my staff to put 
into that office so that we could work in partnership to evolve 
our program. I think our program was successful because we had 
it properly resourced, and I probably had one of the larger 
Office of Small and Disadvantaged Business Utilization in 
government, including that it was staffed by a senior executive 
official.
    I think that is a really important and valid point. 
Agencies need to focus a little bit more on their small 
business programs and how to bring in small businesses, and 
that starts with the right people talking to the small 
businesses.
    Senator Portman. Great. My final question is about Federal 
acquisition regulations. They are often added. They are rarely 
taken away. Mr. Schneider mentioned that a second ago with 
regard to one. New regulations are necessary but obsolete rules 
and regulations, it seems to me, have to be removed.
    Ms. Sullivan, one of the strengths of our acquisition 
system is the presumption of competition, to get the best 
value, so people have to compete with one another, and that is 
a good thing. Based on your experience with small to midsize 
companies, what Federal rules or regulations make it difficult 
for these smaller companies to comply or compete when doing 
business with the Federal Government and what rules or 
regulations should be removed?
    Ms. Sullivan. I think that clarity is always what small 
businesses are seeking in any rule or regulation. One of the 
issues that has been kind of plaguing the community for a long 
time, that I had mentioned in my opening remarks, is the time 
period from when the FAR Council issues a rule and the SBA 
issues a final rule. It can span many years, and the 
acquisition community often does not take SBA's final rules as 
what they should be, which is that they should be followed 
until it is in the FAR. It creates a ton of confusion and then 
even more regulations or more rules that have to show up after 
the fact because the rulemaking is not simultaneous.
    Also I think the SBA Office of Advocacy did a nationwide 
tour a couple of years ago, I think, if I am remembering the 
timetable correct, and asked small businesses what regulations, 
including contractors, are really hindering them. It encouraged 
taking a look at that and what they found, because I know that 
they found specific ones that were problematic for small and 
obviously midsize companies as well.
    Senator Portman. Great. We will look for that. Our capable 
staff is already behind us, trying to find that online.
    Thank you, Mr. Chairman. Thank you to the witnesses. Thanks 
for your service.
    Chairman Peters [presiding.] Thank you, Senator Portman.
    Ms. Correa, the Government Ownership and Oversight of Data 
in Artificial Intelligence (GOOD AI) Act is legislation that I 
worked on with Ranking Member Portman which would create an 
artificial intelligence hygiene working group. This group of 
experts would create a means to ensure that Federal contractors 
are using AI properly for the benefit of the country and that 
the information collected through these technologies is not 
misused.
    My question for you is what are your thoughts on developing 
additional contract requirements to ensure our systems are 
secure and that sensitive information is being protected?
    Ms. Correa. I never oppose contract requirements that are 
about protecting our information, protecting our country, and 
protecting our citizenry. However, we need to look at those 
rules carefully and how they are going to impact industry, 
because every time that we add rules in the Federal acquisition 
regulation we are imposing new requirements on companies, and 
they have to comply and they have to demonstrate compliance. We 
also create additional work for the contracting officer or that 
acquisition workforce, both from the program as well as the 
procurement side.
    What I would say is we have to carefully look at these 
rules and make sure that we are looking at any other rules that 
are affected by this rule, because all too often we are also 
adding regulations without looking at what is already on the 
books, what are the compliance requirements that are already on 
the books.
    But I am not opposed to any rules that protect our data, 
protect our people, and protect our government. I am totally in 
favor of that. I want to make sure that we do it right, that we 
are looking across the spectrum to see what else is out there.
    Chairman Peters. Mr. Schneider and Ms. Sullivan, do you 
have thoughts on this matter?
    Mr. Schneider. I agree. I would like to see the working 
group, if they are going to propose new things that are needed 
they could also propose, to Senator Portman's question, 
something that needs to go away, but also there should be some 
requirement on them to be able to explain what is not available 
today within the regulations to achieve the outcome. They 
should first be looking for how do the current regulations meet 
the outcomes they are seeking and then look toward what new 
requirements might be necessary.
    Ms. Sullivan. Mr. Schneider actually mentioned something I 
was going to say earlier, which is any new committee or any new 
regulations in the cybersecurity realm or securing our 
information, the regulations between DOD and civilian agencies 
need to make sure that they are talking to each. Because that 
has been a big problem for small businesses is there are 
different agencies making really good changes to their 
requirements but then they are not talking to each other. Then 
the compliance for each one gets confusing and time-consuming 
and expensive and does not result in better security for our 
contractors.
    Chairman Peters. Good.
    Mr. Schneider, I would also, in closing here, just like you 
to speak more about the process that you mentioned in your 
opening statement that would allow technologies to be refreshed 
throughout their lifecycle without necessitating a new 
procurement. Would you expand on that, please?
    Mr. Schneider. I think you mentioned this in the beginning, 
the fact that we get things that are maybe new to an agency but 
not new to the ecosystem, because of some of the procurement 
timelines that we have. We need agility inside the procurement 
process to be able to have procurements done quicker. The 
reality is those may never get to the timelines that we really 
want them to be able to acquire technologies on the timeline 
that agencies are really going to want them and that the 
timelines technologies are being developed.
    How do we add flexibilities into those procurement vehicles 
that allow vendors to come in and propose technical refreshes, 
build it more at maybe the capability versus the procurement 
vehicle at the capability level versus at the product level, so 
that new products can be brought in to support that capability 
as the products evolve over time, and for services as well.
    Chairman Peters. Ms. Correa, do you have some thoughts?
    Ms. Correa. No. I agree with what Grant is saying, that we 
do need to build that technical refresh capability, and we have 
done that before. It is not something new. It is how we do it. 
How do we build it in there so that it is agile and flexible 
and it is properly interpreted by the parties, because a lot of 
times that is what you really run into is how we are 
interpreting the rules and what we put into the contracts.
    Chairman Peters. Great. Thank you.
    I would like to thank all of our witnesses here for 
participating in today's important discussion. I appreciate you 
taking the time and for your very thorough answers to the 
questions that we posed.
    I think this conversation has given us a lot of 
information. It has given us some ideas on how we can continue 
to improve the procurement process, especially when it comes to 
expanding opportunities for businesses to work with the Federal 
Government, particularly small businesses, which is a priority 
for me and I think many of the Members on this Committee.
    Also how do we keep pace with rapidly changing technology. 
The change we have seen will likely only accelerate in the 
years ahead and we definitely need to be nimble and creative in 
how we approach this problem. All three of you have given us 
some ideas and we would love to continue to work with you in 
the months ahead.
    I want to thank Ranking Member Portman for holding this 
hearing with me. We all look forward to working together. This 
is a very bipartisan Committee that rolls up our sleeves and 
gets things done, and this is one of those areas where we need 
to do that. But we know that we are going to need to be talking 
to you on a regular basis in order to accomplish that.
    The record for this hearing will remain open for 15 days, 
until 5 p.m. on May 27, 2022, for the submission of statements 
and questions for the record.
    The hearing is now adjourned.
    [Whereupon, at 11:21 a.m., the hearing was adjourned.]

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