[Congressional Record Volume 142, Number 86 (Wednesday, June 12, 1996)]
[Senate]
[Pages S6155-S6163]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             ADMINISTRATIVE DISPUTE RESOLUTION ACT OF 1995

  Mr. LOTT. Mr. President, I ask unanimous consent that the Senate 
proceed to the immediate consideration of Calendar No. 350, S. 1224.
  The PRESIDING OFFICER. The clerk will report:
  The bill clerk read as follows:

       A bill (S. 1224) to amend subchapter IV of chapter 5 of 
     title 5, United States Code, relating to alternative means of 
     dispute resolution in the administrative process, and for 
     other purposes.

  The PRESIDING OFFICER. Is there objection to the immediate 
consideration of the bill?
  There being no objection, the Senate proceeded to consider the bill 
which had been reported from the Committee on Governmental Affairs, 
with an amendment to strike all after the enacting clause and insert in 
lieu thereof the following:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Administrative Dispute 
     Resolution Act of 1995''.

     SEC. 2. AMENDMENT TO DEFINITIONS.

       Section 571 of title 5, United States Code, is amended:
       (1) in paragraph (3)--
       (A) by striking out ``settlement negotiations,''; and
       (B) by striking out ``and arbitration'' and inserting in 
     lie thereof ``use of ombuds, and binding or nonbinding 
     arbitration,''; and
       (2) in paragraph (8)--
       (A) in subparagraph (B) by striking out ``decision,'' and 
     inserting in lieu thereof ``decision.''; and
       (B) by striking out the matter following subparagraph (B).

     SEC. 3. AMENDMENTS TO CONFIDENTIALITY PROVISIONS.

       (a) Termination of Availability Exemption to 
     Confidentiality.--Section 574(b) of title 5, United States 
     Code, is amended:
       (1) in paragraph (5) by adding ``or'' at the end thereof;
       (2) in paragraph (6) by striking out ``; or'' and inserting 
     in lieu thereof a period; and
       (3) by striking out paragraph (7).
       (b) Limitation of Confidentiality Application to 
     Communication.--Section 574 of title 5, United States Code, 
     is amended--
       (1) in subsection (a) in the matter before paragraph (1) by 
     striking out ``any information concerning''; and
       (2) in subsection (b) in the matter before paragraph (1) by 
     striking out ``any information concerning''.
       (c) Alternative Confidentiality Procedures.--Section 574(d) 
     of title 5, United States Code, is amended--
       (1) by inserting ``(1)'' after ``(d)''; and
       (2) by adding at the end thereof the following new 
     paragraph:
       ``(2) To qualify for the exemption established under 
     subsection (j), an alternative confidential procedure under 
     this subsection may not provide for less disclosure than the 
     confidential procedures otherwise provided under this 
     section.''.
       (d) Exemption From Disclosure by Statute.--Section 574 of 
     title 5, United States Code, is amended by striking out 
     subsection (j) and inserting in lieu thereof the following:
       ``(j) A dispute resolution communication which is generated 
     by or provided to an agency or neutral, and which may not be 
     disclosed under this section, shall also be exempt from 
     disclosure under section 552(b)(3).''.

     SEC. 4. AMENDMENT TO REFLECT THE CLOSURE OF THE 
                   ADMINISTRATIVE CONFERENCE.

       (a) Promotion of Administrative Dispute Resolutions.--
     Section 3(a)(1) of the Administrative Dispute Resolution Act 
     (5 U.S.C. 581 note; Public Law 101-552; 104 Stat. 2736) is 
     amended by striking out ``the Administrative Conference of 
     the United States and''.
       (b) Compilation of Information--
       (1) In general.--Section 582 of title 5, United States 
     Code, is repealed.
       (2) Technical and conforming amendment.--The table of 
     sections for chapter 5 of title 5, United States Code, is 
     amended by striking out the item relating to section 582.
       (c) Federal Mediation and Conciliation Service.--Section 
     203(f) of the Labor Management Relations Act, 1947 (29 U.S.C. 
     173(f)) is amended by striking out ``the Administrative 
     Conference of the United States and''.

     SEC. 5. AMENDMENTS TO SUPPORT SERVICE PROVISION.

       Section 583 of title 5, United States Code, is amended by 
     inserting ``State, local, and tribal governments,'' after 
     ``other Federal agencies,''.

     SEC. 6. AMENDMENTS TO THE CONTRACT DISPUTES ACT.

       Section 6 of the Contract Disputes Act of 1978 (41 U.S.C. 
     605) is amended--
       (1) in subsection (d) by striking out the second sentence 
     and inserting in lieu thereof: ``The contractor shall certify 
     the claim when required to do so as provided under subsection 
     (c)(1) or as otherwise required by law.''; and
       (2) in subsection (e) by striking out the first sentence.

     SEC. 7. AMENDMENTS ON ACQUIRING NEUTRALS.

       (a) Expedited Hiring of Neutrals.--
       (1) Competitive requirements in defense agency contracts.--
     Section 2304(c)(3)(C) of title 10, United States Code, is 
     amended by striking out ``agency, or'' and inserting in lieu 
     thereof ``agency, or to procure the services of an expert or 
     neutral for use''.
       (2) Competitive requirements in federal contracts.--Section 
     303(c)(3)(C) of the Federal Property and Administrative 
     Services Act of 1949 (41 U.S.C. 253(c)(3)(C)), is amended by 
     striking out ``agency, or'' and inserting in lieu thereof 
     ``agency, or to procure the services of an expert or neutral 
     for use''.
       (b) References to the Administrative Conference of the 
     United States.--Section 573 of title United States Code is 
     amended--
       (1) by striking out subsection (c) and inserting in lieu 
     thereof the following:
       ``(c) In consultation with other appropriate Federal 
     agencies and professional organizations experienced in 
     matters concerning dispute resolution, the Federal Mediation 
     and Conciliation Service shall--
       ``(1) encourage and facilitate agency use of alternative 
     means of dispute resolution; and
       ``(2) develop procedures that permit agencies to obtain the 
     services of neutrals on an expedited basis.''; and
       (2) in subsection (e) by striking out ``on a roster 
     established under subsection (c)(2) or a roster maintained by 
     other public or private organizations, or individual''.

     SEC. 8. ARBITRATION AWARDS AND JUDICIAL REVIEW.

       (a) Arbitration Awards.--Section 580 of title 5, United 
     States Code, is amended--
       (1) by striking and subsections (c), (f), and (g); and
       (2) by redesignating subsections (d) and (e) as subsections 
     (c) and (d), respectively.
       (b) Judicial Awards.--Section 581(d) of title 5, United 
     States Code, is amended--
       (1) by striking out ``(1)'' after ``(b)''; and
       (2) by striking out paragraph (2).

     SEC. 9. PERMANENT AUTHORIZATION OF THE ALTERNATIVE DISPUTE 
                   RESOLUTION PROVISIONS OF TITLE 5, UNITED STATES 
                   CODE.

       The Administrative Dispute Resolution Act (Public Law 101-
     552; 104 Stat. 2747; 5 U.S.C. 581 note) is amended by 
     striking out section 11.

     SEC. 10. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--Subsection IV of title 5, United States 
     Code, is amended by adding at the end thereof the following 
     new section:

     ``Sec. 584. Authorization of appropriations

       ``There are authorized to be appropriated such sums as may 
     be necessary to carry out the purposes of this subchapter.''.
       (b) Technical and Conforming Amendment.--The table of 
     sections for chapter 5 of title 5, United States Code, is 
     amended by inserting after the item relating to section 583 
     the following:

``Sec. 584. Authorization of appropriations.''.

  Mr. COHEN. Mr. President, over the past decades, a consensus has 
emerged that traditional litigation is an inefficient way to resolve 
disputes. Not only is litigation costly, but due to its adversarial, 
contentious nature, litigation often deteriorates working relationships 
and fails to produce long-term solutions to problems.
  Private corporations recognized many years ago that certain types of 
disputes could be resolved much less expensively and with less acrimony 
by relying on techniques such as mediation, arbitration, and 
partnering,

[[Page S6156]]

which collectively have become known as alternative dispute resolution 
or ADR.
  In 1990, Congress recognized that the Government lagged well behind 
the private sector in this field and in response enacted the 
Administrative Dispute Resolution Act to promote the use of ADR in 
Government agencies. Senators Grassley and Levin led the effort to pass 
this legislation and bring the benefits of ADR to the Federal 
Government.
  The act authorizes agencies to apply ADR to almost any type of claim 
involving the Government, requires the appointment of ADR specialists 
in each agency, establishes procedures for hiring neutral third-parties 
to help resolve disputes, and provides confidentiality protection to 
parties participating in ADR.
  S. 1224, the bill before the Senate, would permanently reauthorize 
this important legislation. It would also improve the system for hiring 
mediators, provide additional confidentiality protections to ADR 
participants, promote the use of binding arbitration and make a number 
of other minor adjustments to the act.
  The Subcommittee on Oversight of Government Management held a hearing 
on the bill on November 29. At the hearing, the Department of Justice, 
the Federal Mediation and Conciliation Service, the Office of 
Management and Budget, the American Bar Association, and private 
individuals representing the Heritage Foundation and a consortium of 
Government contractors all praised the ADR Act and strongly endorsed 
its reauthorization. On December 12, 1995, the bill was unanimously 
reported, with an amendment in the nature of a substitute, by the 
Committee on Governmental Affairs.
  The most significant change this bill makes to the original ADR Act 
is the repeal of a provision known as the arbitration escape clause. 
During consideration of the ADR Act in 1990, this provision was 
included to accommodate the Department of Justice's view that agencies 
lacked constitutional authority to refer disputes to binding 
arbitration. Although many scholars and the sponsors of the bill 
disagreed with this view, to satisfy the Department of Justice [DOJ], a 
provision was added that enabled Federal agencies to opt-out of 
arbitral awards. Unfortunately, this unilateral provision has deterred 
private parties from entering into arbitration with the Government. As 
one witness testified at the hearing on this reauthorization 
legislation, unless the escape clause is eliminated, ``arbitration 
likely will never become a viable alternative for the Federal 
Government.''
  This would be unfortunate. Throughout the private sector, companies 
are saving money and reducing litigation costs by using arbitration to 
resolve commercial disputes instead of resorting to litigation. If we 
want the Government to enjoy the efficiencies of the private sector, it 
must have the flexibility to operate as a private business, especially 
when the Government is acting as a commercial entity. Indeed, the 
Government achieves a double benefit when a case is resolved through 
arbitration rather than litigation because not only are agency 
litigation costs and attorneys fees reduced, but judicial resources are 
freed to pursue criminal cases or other civil matters.
  Last year, DOJ's Office of Legal Counsel issued a detailed opinion 
concluding that Federal agencies could submit disputes to binding 
arbitration without violating the Constitution. Since the 
constitutional objection to binding arbitration has been removed, there 
is no longer any reason to reauthorize the agency escape clause.
  There are two amendments to S. 1224 before the Senate for 
consideration. The first amendment is designed to increase the 
efficiency of our procurement system by consolidating jurisdiction over 
bid protest claims in the Court of Federal Claims. The amendment would 
reverse the decision of the D.C. Circuit in Scanwell Lab., Inc. versus 
Shaffer (1969), that permitted bid protests to be filed in any district 
court across the country. Providing district courts with jurisdiction 
to hear bid protest claims has led to forum shopping and the 
fragmentation of Government contract law. Consolidation of jurisdiction 
in the Court of Federal Claims is necessary to develop a uniform 
national law on bid protest issues and end the wasteful practice of 
shopping for the most hospitable forum. Congress established the Claims 
Court--now the Court of Federal Claims--for the specific purpose of 
improving the administration of the law in the areas of patents, 
trademarks, Government contracts, Government employment, and 
international trade. Scanwell jurisdiction frustrates this purpose and 
deprives litigants of the substantial experience and expertise the 
Court of Federal Claims has developed in the Government contracting 
area.
  The Information Technology and Management Reform Act of 1996, which I 
authored, eliminated the authority of the General Services Board of 
Contract Appeals to entertain bid protests on information technology 
contracts and left the General Accounting Office as the single extra-
agency administrative forum for such actions. My amendment to S. 1224 
follows this path of reform by creating a single forum for all bid 
protest litigation, which will lead to the development of more uniform, 
and thus more predictable, law.
  Identical legislation passed the Senate as part of the Federal 
Acquisition Streamlining Act, but was rejected in conference. The 
Department of Justice and Office of Management and Budget strongly 
support the addition of this legislation to the ADR Act.
  I also want to express my support for the Levin-Grassley amendment to 
S. 1224, which would reauthorize the Negotiated Rulemaking Act. This 
legislation establishes a framework for agencies to convene interested 
parties for the purpose of developing consensus-based regulation. When 
it is used, negotiated rulemaking can improve the quality, 
acceptability, and timeliness of regulations, reduce litigation, and 
enhance industry compliance, thereby reducing the costs of regulations 
to both private industry and the Government. Over the past 5 years 
negotiated rulemaking has been an unqualified success; there is no 
reason not to reauthorize this legislation while we are dealing with 
the closely related ADR Act.
  In sum, reauthorization of the ADR and Negotiated Rulemaking Acts and 
the elimination of Scanwell jurisdiction represent cost-saving, 
commonsense improvements to the Federal regulatory and administrative 
processes. These reforms are good for the taxpayer, good for our 
courts, and good for the parties that have disputes with the 
Government.
  I congratulate Senators Grassley and Levin for the success of the 
original pieces of legislation and commend them for their work on this 
reauthorization bill.
  I urge my colleagues to support this bill and sincerely hope that it 
may be enacted into law during this session of Congress.
  I ask unanimous consent that the letter from the Department of 
Justice I referred to be printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                       U.S. Department of Justice,


                                Office of Legislative Affairs,

                                   Washington, DC, April 12, 1996.
     Hon. William S. Cohen,
     Chairman, Subcommittee on Oversight of Government Management 
         and the District of Columbia, Committee on Governmental 
         Affairs, U.S. Senate, Washington, DC.
       Dear Mr. Chairman: The Administration supports your efforts 
     to enact legislation that would make one small but vital 
     improvement to the handling of bid protests arising from the 
     award of Federal contracts--the elimination of district court 
     jurisdiction over bid protests (the so-called Scanwell 
     cases).\1\ In disputes between an agency and a contractor 
     after the award of a contract, Congress has previously 
     recognized the need for a uniform national body of law to 
     guide both Federal procurement officials and Federal 
     contractors. The same need for nationwide uniformity exists 
     for bid protests. The current forum shopping between the 
     Federal district courts and the Court of Federal Claims only 
     encourages needless litigation in a search for the most 
     hospitable forum, and results in disparate bodies of law 
     between the circuits. There is simply no need to have 
     multiple judicial bodies to review bid protests of federal 
     contacts.
---------------------------------------------------------------------------
     \1\ Scanwell Lab., Inc. v. Shaffer, 424 F.2d 859, 869, 137 
     U.S. App. D.C. 371, 381 (1969) (held, a contractor making a 
     prima facie showing alleging arbitrary or capricious action, 
     or an abuse of discretion, by an agency or contracting 
     officer in making the award of a contract, has standing to 
     sue in district court under the Administrative Procedure 
     Act).
---------------------------------------------------------------------------
       In the past, Congress has recognized the need for 
     nationwide uniformity in several areas of the law, and 
     established the Claims

[[Page S6157]]

     Court (now the Court of Federal Claims) and the Court of 
     Appeals for the Federal Circuit to achieve that result. 
     Federal Courts Improvement Act of 1982 (FCIA) Pub. L. No. 97-
     164. The purpose of the FCIA was to improve ``the 
     administration of the law in the areas of patents, government 
     contracts, merit system protection, trademarks and 
     international trade.'' H. Rep. No. 97-312, 97th Cong., 1st 
     Sess. 17 (1981). As a result of the enactment of the FCIA, 
     the Court of Federal Claims was made the sole judicial forum 
     for resolution of contract disputes between the contractor 
     and the agency. The very same need exists for nationwide 
     uniformity in the handling of bid protests.
       By eliminating the authority of the General Services Board 
     of Contract Appeal to entertain bid protests of the award of 
     information technology contracts, the recently-enacted 
     defense authorization bill for fiscal year 1996 (Pub. L. No. 
     104-106) took a significant step forward in the handling of 
     bid protests by leaving the General Accounting Office as the 
     sole remaining extra-agency administrative forum. The process 
     of procurement reform should continue by eliminating Scanwell 
     jurisdiction, and by creating a single judicial forum to 
     govern all bid protest litigation, both prior to and after 
     award. While there is good reason to apply local state law, 
     as district courts are required to do when they adjudicate 
     torts under the Federal Tort Claims Act, it is simply 
     inappropriate to have different interpretations of Federal 
     contracts applied, depending upon where the contractor 
     resides or where the contract will be performed. This results 
     in inconsistent application of legal principles and an 
     unwieldy body of procurement law.
       Our concerns about varying results in the district courts 
     is not hypothetical. For example, the district court in 
     Advanced Seal Tech., Inc. v. Perry, 873 F. Supp. 1144 (N.D. 
     Ill. 1995), disagreed with the district court's holding in 
     Abel Converting, Inc. v. United States, 679 F. Supp. 1133 
     (D.D.C. 1988), regarding the burden of proof borne by the 
     protestor to establish grounds for injunctive relief. 
     Similarly, the district court in Washington Mechanical 
     Contractors, Inc. v. United States Dept. of the Navy, 612 F. 
     Supp. 1243 (N.D. Cal. 1984), disagreed with the district 
     court's decision in Robert E. Dereckto of Rhode Island, Inc. 
     v. Goldschmidt, 506 F. Supp. 1059 (D. R.I. 1980), regarding 
     the quantum of proof necessary to invalidate an award of a 
     contract. In addition, the district court in Metric Systems 
     Corp. v. United States Dept. of the Air Force, 673 F. Supp 
     439 (N.D. Fla. 1987), disagreed with the holding in Acme of 
     Precision Surgical Co., Inc. v. Weinberger, 580 F. Supp. 490 
     (E.D. Pa. 1984), that Federal district courts have both pre- 
     and post-award bid protest jurisdiction. These cases show 
     that, since Federal district court judges rarely have the 
     opportunity to review bid protests, as might be suspected, 
     the results vary from court-to-court.
       Legislation should seek to accomplish three important 
     goals. First, it should achieve a uniform and consistent body 
     of precedent governing bid protests, by providing interested 
     parties with a choice of only one administrative and one 
     judicial forum for the resolution of bid protests. Second, it 
     should discourage forum shopping between the remaining 
     tribunal and court by imposing a similar, if not identical, 
     standard and scope of review in both fora. Finally, it should 
     impose a standard and scope of review which both recognizes 
     the deference to the contracting agency in conducting 
     procurements and also limits expensive, time-consuming and 
     resource-intensive discovery.
       As Mr. Steven Kelman, Administrator for Federal Procurement 
     Policy, testified before your subcommittee last July:
       ``With its nationwide jurisdiction and contract expertise, 
     the Court of Federal Claims could effectively and efficiently 
     serve as a unified judicial forum operating in the national 
     interest. This would avoid the unfairness of forum shopping. 
     At the same time, it would not prevent small businesses from 
     having their day in court inasmuch as the Court of Federal 
     Claims is authorized to hold hearings throughout the country 
     to minimize inconvenience and expense to litigants.''
       In summary, the problems associated with district court bid 
     protest activity can be effectively avoided by vesting 
     judicial bid protests authority, both pre- and post-award, 
     exclusively in the Court of Federal Claims and imposing a 
     deferential standard of review and limited scope of review 
     similar to that used by the General Accounting Office. With 
     national jurisdiction, this court would effectively serve as 
     a unified judicial forum with contract expertise, eliminating 
     forum shopping and promoting the application of consistent 
     legal principles.
       We urge Congress to take immediate action to eliminate 
     Scanwell jurisdiction in the district courts. We would be 
     happy to work with you to ensure enactment of legislation 
     that would meet this important objective. The Office of 
     Management and Budget has advised that there is no objection 
     from the standpoint of the Administration's program to the 
     presentation of this report.
           Sincerely,
                                                      Andrew Fois,
                                       Assistant Attorney General.

  Mr. LEVIN. Mr. President, we all want a Government that works better 
and costs less, and I am pleased that the Senate is considering today 
legislation authored by myself and Senator Chuck Grassley to encourage 
faster, less costly ways to resolve disputes with the Federal 
Government.
  It's a fact of life that many people have disputes with the Federal 
Government. In the late 1980's, of the 220,000 civil cases filed on 
Federal court, more than 55,000 involved the Federal Government in one 
way or another. Resolving these disputes costs taxpayers billions of 
dollars.
  Resolving them before they become courtroom dramas is one way to make 
a dent in this billion-dollar drain on taxpayer funds. Mediation, 
arbitration, mini-trials, and other methods offer cheaper, faster 
alternatives to courtroom battles.
  That's why, 6 years ago, Senator Grassley and I cosponsored the 
Administrative Dispute Resolution Act of 1990. It is why we have teamed 
up again this year on legislation to reauthorize that act and ensure 
that alternative dispute resolution techniques, which those familiar 
with it call ADR, remain a cost-effective tool that Federal agencies 
can use to resolve disputes.
  Since the passage of the ADR law in 1990, Federal agencies have 
increasingly used alternatives to courtroom litigation to save time and 
money. The Army Corps of Engineers, for example, successfully resolved 
53 of 55 contract disputes with ADR over a 5-year period, including 
settling a $55 million claim in 1994 for $17.3 million in 4 days. The 
Resolution Trust Corporation saved legal costs of approximately $115 
million from 1991 through 1994, by using ADR instead of litigation. The 
Navy shortened dispute resolution times in some cases from 4 years to 3 
months by replacing formal litigation with informal, abbreviated 
proceedings. Not all Federal agencies have used ADR extensively, but 
those agencies that have tried it report both savings and satisfaction 
with the process.
  In these times of tight Federal budgets and shrinking Government, we 
need more of the savings that ADR offers, not less. That's why the ADR 
Act should become a permanent fixture in Federal law. The act's 
unfortunate lapse in October of last year due to the press of business 
before Congress shows why this step is necessary.

  The bill that Senator Grassley and I have introduced, S. 1224, would 
fill the current statutory void by permanently reauthorizing the ADR 
law. It would also fine-tune the law in several ways.
  First and most importantly, the bill would eliminate a 30-day escape 
hatch that allowed Federal agencies unilaterally to vacate an 
arbitration award that disadvantaged the Government. In the 5 years 
this one-way escape clause has been on the books, no one has ever 
agreed to an arbitration proceeding with the Government on this basis. 
Eliminating this unilateral escape clause--which allows the Government 
but not its opponent to nullify an arbitration decision--is expected to 
encourage parties to agree to use binding arbitration as a cost-saving 
alternative to civil litigation. Other bill provisions make it clear 
that Federal agencies also retain the option to use nonbinding 
arbitration, when they so choose.
  Second, the bill would encourage use of ADR methods by clarifying the 
confidentiality of ADR proceedings in several respects. The bill would 
make it clear that confidential documents prepared for purposes of an 
ADR proceeding are also exempt from disclosure under the Freedom of 
Information Act. The bill would also strike overly broad language 
which, if taken literally, would prohibit ADR neutrals and parties from 
disclosing any information concerning an ADR proceeding, even whether 
an ADR proceeding took place. The bill would also eliminate a provision 
that ended confidentiality protections for any document given to all 
parties, since this provision discourages open communications among all 
the parties to a dispute. Together, these changes clarify, focus and 
strengthen the law's confidentiality protections for ADR negotiations.
  Third, the bill would encourage ADR by making it easier to use and 
improving coordination with other dispute resolution procedures. 
Specifically, the bill would clarify agency authority to hire mediators 
and other ADR neutrals on an expedited basis; allow agencies to accept 
donated services from State, local and tribal governments to support an 
ADR proceeding; add an explicit authorization for such sums as may be 
necessary to implement the ADR law; remove a provision which

[[Page S6158]]

barred Federal employees from electing to use ADR methods to resolve 
certain personnel disputes; and eliminate special paperwork burdens on 
contractors willing to use ADR to resolve small claims against the 
Government under the Contract Disputes Act.
  Finally, the bill would reassign the tasks of encouraging and 
facilitating agency use of ADR methods from the Administrative 
Conference of the United States, which no longer exists due to a lack 
of appropriations, to the Federal Mediation and Conciliation Service, 
which has experience in this area.

  Mr. President, I would also like to urge my colleagues to support a 
Levin-Grassley amendment to the ADR bill which would also reauthorize 
the Negotiated Rulemaking Act of 1990. The Negotiated Rulemaking Act 
became law back in 1990, at the same time as the ADR Act--in fact, for 
a time, the two laws shared the same United States Code cites--so it 
would be fitting to reauthorize both laws in the same piece of 
legislation.
  Like the ADR law, the Negotiated Rulemaking Act is a reform effort 
that seeks to interject common sense and cost savings into the way the 
Federal Government does business. In essence, it allows a regulated 
community to form an advisory committee with all other interested 
parties to work with the Federal Government to draft regulations that 
everyone will then have to live by.
  An its name implies, the point of the law is to get parties to 
negotiate with each other and the Federal Government to devise 
sensible, cost effective rules. No one is required to participate in a 
negotiation, and no one gives up their rights by agreeing to negotiate. 
It is a voluntary, rather than a mandatory, process.
  The pleasant surprise is that it works. Since the Negotiated 
Rulemaking Act was enacted 6 years ago, agencies across the Government 
have tried it and liked it.
  Over the past 6 years, negotiated rulemaking has been used to issue 
regulations under the Clean Air Act to produce cleaner burning gasoline 
and to clear haze from the Grand Canyon. The Coast Guard has used it to 
improve ships' oilspill fighting capabilities, while the Federal 
Railroad Administration has used it to improve railway worker safety. 
The Farm Credit System has negotiated a rule to apportion its 
administrative expenses among banks and other parties, while the FCC 
has used it to apportion data messaging services on satellites.
  President Clinton has embraced the concept with an Executive order 
that encourages all agencies to try negotiated rulemaking at least once 
per year. Some agencies, like the Federal Aviation Administration, have 
found it so rewarding that they have established standing negotiated 
rulemaking committees and routinely invoke negotiated rulemaking to 
resolve difficult regulatory problems.
  These agencies and others have discovered that, in many rulemaking 
situations, negotiation beats confrontation in terms of cost, time, 
aggravation, and the ability to develop regulations that parties with 
very different perspectives can accept. One industry participant in the 
clean air negotiations put it this way, ``It's a better situation when 
people who are adversaries can sit down at the table and talk about it 
rather than throwing bricks at each other in courtrooms and the 
press.'' An environmental journal came to the same conclusion, summing 
up the Grand Canyon negotiation with the headline, ``See You Later, 
Litigator.'' The Washington Post has called negotiated rulemaking 
plainly a good idea, while the New York Times has called it an 
immensely valuable procedure that ought to be used far more often.

  The goal of the Levin-Grassley amendment is exactly that--to 
reauthorize the Negotiated Rulemaking Act to ensure continued agency 
use of this rulemaking procedure.
  The amendment itself is straightforward. Like the ADR bill, it 
reauthorizes the 1990 law and makes it a permanent part of the U.S. 
Code. Like the ADR bill, it facilitates agency hiring of neutrals, 
called convenors and facilitators; provides an authorization for 
appropriations; and reassigns the responsibility of facilitating and 
encouraging agency use of negotiated rulemaking from the Administrative 
Conference of the United States, which has been terminated, to an 
agency or interagency committee to be designated by the President.
  This amendment has been circulated extensively among negotiated 
rulemaking practitioners and is supported by the administration and the 
American Bar Association. It has been cleared by both sides of the 
aisle. It is being offered now to avoid a lapse in the law which is 
scheduled to expire in November.
  Mr. President, I would like to thank Senator Grassley for his 
leadership on both ADR and negotiated rulemaking; Senator Cohen, 
chairman of the Government Affairs Oversight Subcommittee, for his 
continuing support; and Senator Stevens, Governmental Affairs Committee 
chairman, for his cooperation in getting this legislation to the floor 
despite a crowded calendar.
  Alternative dispute resolution methods and negotiated rulemaking 
provide new and better ways to conduct Government business. They cost 
less, they're quicker, they're less adversarial, they develop sensible 
solutions to problems, and they free up courts for other business. They 
are two success stories in creating a government that works better and 
costs less. I urge my colleagues to join Senator Grassley and myself in 
voting for the reauthorization of both laws.
  Mr. GRASSLEY. Mr. President, the Administrative Dispute Resolution 
Act before us, sponsored by myself and Senator Levin, is an amendment 
to title 5 of the United States Code. This is a law which I originally 
sponsored back in 1989 with Senator Levin. That 1989 law, also titled 
the ``Administrative Dispute Resolution Act,'' was crafted to encourage 
Federal agencies to streamline dispute resolution processes by use of 
alternative dispute resolution techniques rather than by litigation. 
These techniques are often collectively referred to as ADR, and include 
mediation, arbitration, conciliation, fact-finding, and minitrials.
  Since the enactment of that law, most Federal agencies have 
formulated ADR programs and consequently have saved significant amounts 
of time and money by avoiding litigation of claims. At the same time, 
agencies haven't sacrificed fairness or party satisfaction. Overall, 
agencies have recognized the benefits of ADR's efficiency. As an 
example of the success of these programs, the Environmental Protection 
Agency utilizes mediation and arbitration to resolve Superfund, Clean 
Water Act, and Resource Conservation and Recovery Act disputes. The EPA 
has expressed great satisfaction with the results of these techniques 
in their resolution of complex regulatory enforcement issues.
  In addition, ADR techniques are far less costly than litigation. The 
Federal Deposit Insurance Corporation estimated a savings of $13 
million in legal costs in the last 3 years alone because of its ADR 
program. The Resolution Trust Corporation estimated it saved $114 
million over the last 4 years using ADR techniques. These examples are 
proof of ADR's efficiency.
  The judiciary has also benefited from adoption of ADR techniques. The 
U.S. District Court for the Northern District of California estimated 
savings of almost $44,000 in administrative costs per case after it 
implemented an early neutral evaluation program. Although the bill 
before us doesn't include the judiciary, we are in the process of 
drafting a bill that would encourage the judiciary to adopt ADR 
programs, which have been in existence on a limited basis. 
Representative Moorhead's subcommittee has already held hearings on the 
House side regarding this issue, and I expect to pursue this initiative 
in my Judiciary Subcommittee this year.
  Despite the benefits that both the executive and judiciary branches 
have derived from adopting ADR programs, improvements can still be made 
to promote ADR. Many ADR programs haven't been integrated into the 
daily routines of their agencies. Agencies have had legitimate concerns 
about confidentiality, fairness, and quality assurance. Further, the 
original law expired in October of last year, and by not extending this 
law, progress in agency adoption of ADR techniques has been stalled. 
The new ADR bill seeks to address these concerns by modifying and 
clarifying the original act to make ADR more attractive to the agencies 
in the resolution of their disputes.

[[Page S6159]]

  The Governmental Affairs Committee, Subcommittee on Oversight of 
Government Management and the District of Columbia, held a hearing on 
this bill on November 16, 1995. At the hearing, the bill enjoyed strong 
bipartisan support. A number of changes were made to further improve 
the bill. I'd like to briefly summarize the bill as it presently is 
being proposed and how it will accomplish our goals of promoting the 
use of ADR techniques.
  First of all, the bill removes the term ``settlement negotiations'' 
from the group of ADR techniques listed in the 1989 act. This won't 
decrease the effectiveness of the act as settlement negotiations are 
not and have never been covered by the act as they do not use third 
party neutrals in resolving conflicts. Abolition of the term merely 
eliminates agency confusion as to whether settlement negotiation is a 
statutorily supported ADR technique. It doesn't decrease the scope of 
the original act. The bill also clarifies ADR techniques by 
substituting the term ``arbitration'' with ``Use of Ombuds, and Binding 
or Nonbinding Arbitration.''
  The bill addresses agency confidentiality concerns by exempting all 
dispute resolution communications from Freedom of Information Act 
disclosure. Although these communications have always been confidential 
by implication, the proposed bill makes this confidentiality express 
and clear.
  The bill also deletes the Administrative Conference of the United 
States from the promulgation of agency policy addressing the use of ADR 
and case management. This acknowledges the unfortunate demise of the 
Administrative Conference and its consultation with agencies in 
developing and promulgating agency ADR policies, and the maintenance of 
rosters of neutrals and arbitrators.
  The bill makes it easier for agencies to acquire neutrals by 
eliminating the requirement of full competitive procedures in obtaining 
expert services and by allowing the acquisition of neutrals from 
nonprofit organizations. It also amends the Code to provide that 
agencies will consult with the Federal Mediation and Conciliation 
Service on encouraging and facilitating agency use of ADR and 
developing procedures on obtaining services of neutrals.
  The bill expands agency use of services to include services and 
facilities of State, local, and tribal governments. This will allow 
agencies to take advantage of all available support services in order 
to implement their ADR activities in the most effective and efficient 
manner possible.
  The bill eliminates the requirement that the validity of all contract 
claims under $100,000 be certified by the contractor. This change 
brings the 1989 ADR Act into conformance with the certification levels 
in the Contracts Disputes Act, thus encouraging the use of ADR 
techniques in many small disputes where they may be particularly 
appropriate.
  In addition, the bill deletes the so-called escape clause for binding 
arbitration. Under the 1989 law, a Federal agency had the right to 
override an ADR decision after it had been entered. These provisions 
were inserted in the original act because the Department of Justice 
believed there was a constitutional problem regarding agency ability to 
ultimately override ADR decisions. In essence, DOJ felt that it was 
necessary to protect agency interests from the whim of non-judicial 
decisionmakers. The Administrative Conference argued that parties were 
reluctant to go through ADR because they believed that an agency could 
opt out of a final decision and that effectively ADR rulings were 
nonbinding on the Government. Recently, DOJ has dropped these 
constitutional concerns. Deletion of these provisions from the law will 
ultimately further facilitate and promote the use of ADR, by making ADR 
techniques more attractive to the private sector for solving agency 
disputes.
  Finally, the bill permanently authorizes the ADR Act by striking the 
sunset provision presently in the law and authorizing such sums as may 
be necessary to carry out the act.
  Mr. President, there has been much progress in the implementation and 
use of ADR techniques in the Federal Government since I first 
introduced the Administrative Dispute Resolution Act back in 1989. 
Passage of this amendment to the act will further this progress by 
eliminating statutory barriers to ADR use and clarifying statutory 
language. I hope my colleagues will support this initiative.
  Mr. JOHNSTON. Mr. President, I would like to add my support for this 
bill and in particular for a provision, in the amendment providing 
permanent reauthorization of the Negotiated Rulemaking Act of 1990, 
that addresses what I and others perceive to be the redundancy between 
the requirements of this act and the Federal Advisory Committee Act 
[FACA].
  The Negotiated Rulemaking Act, in section 3(a) (5 U.S.C. 564(a)) 
mandates a specific procedure for public notification of the 
establishment of each negotiated rulemaking committee. This includes 
publication ``in the Federal Register and, as appropriate, in trade or 
other specialized publications'' of a notice of intent to form the 
committee, along with ``a description of the subject and scope of the 
rule to be developed, and the issues to be considered; a list of the 
interests likely to be significantly affected by the rule; a list of 
the persons proposed to represent such interests and the person or 
persons proposed to represent the agency; a proposed agenda and 
schedule for completing the work of the committee, including a target 
date for publication by the agency of a proposed rule for notice and 
comment; a description of the administrative support for the committee 
to be provided by the agency, including technical assistance; a 
solicitation for comments on the proposal to establish the committee, 
and the proposed membership of the negotiated rulemaking committee; and 
an explanation of how a person may apply or nominate another person for 
membership on the committee.'' After publication of this notice, there 
is a public comment period of at least 30 days.
  In addition to these statutory requirements, negotiated rulemaking 
committees are subject to regulatory review requirements of 
Presidential Executive orders. Section 3(e) of President Clinton's 
Executive Order No. 12866 defines ``regulatory action'' as ``any 
substantive action by an agency (normally published in the Federal 
Register) that promulgates or is expected to lead to the promulgation 
of a final rule or regulation, including notices of inquiry, advance 
notices of proposed rulemaking, and notices of proposed rulemaking.'' 
The notice of intent to establish a negotiated rulemaking committee, 
required by 5 U.S.C. 564(a)(1), would appear to be completely within 
this definition, as it is analogous to an advanced notice of proposed 
rulemaking, and certainly a more ``substantive action by an agency * * 
* expected to lead to the promulgation of a final rule'' than a mere 
notice of inquiry. Thus, even a plan to publish such a notice, for a 
``significant regulatory action,'' must be disclosed to the Office of 
Management and Budget [OMB] under section 6(a)(3)(A) of the Executive 
Order. Given the very broad definition of ``significant regulatory 
actions'' in the Executive order, OMB is effectively capable of 
capturing for review any negotiated rulemaking committee that it wants.
  Quite apart from these requirements and reviews, negotiated 
rulemaking committees must meet a second, parallel set of disclosure 
and review requirements contained in section 9 of FACA, because 
negotiated rulemaking committees are within the definition of an 
``advisory committee'' under FACA. Thus, the FACA requirements in 
section 9 for ``consultation with the Administrator'' of the General 
Services Administration [GSA], ``timely notice in the Federal 
Register,'' and filing of a charter containing a list of specific 
topics that closely resembles the topics in section 3(a) of the 
Negotiated Rulemaking Act, quoted above, also apply to the negotiated 
rulemaking committees.
  There is clearly duplication of effort here, without, in my opinion, 
much value added. First of all, if the President has put in place a 
mechanism, via Executive order, by which the Office of Information and 
Regulatory Affairs in OMB must be apprised of a mere plan to form a 
negotiated rulemaking committee, what is the added value of a 
mandate for a separate consultation with the GSA under FACA? Surely the 
President's designee for Government-

[[Page S6160]]

wide regulatory review and coordination, in OMB, is better situated to 
advise agencies on the need for such committees than the GSA. Second, a 
comparison of the typical advisory committee charter received in the 
Committee on Energy and Natural Resources with the typical Federal 
Register notice for a negotiated rulemaking committee over the past 
year shows that the latter is generally more detailed and informative 
than the former. Finally, is it really necessary to have two separate 
legal requirements for notice in the Federal Register of the same 
event?

  In addition to these overlapping requirements and processes, it is a 
fair question whether other specific requirements of FACA, for example, 
the automatic 2-year sunset of advisory committees, make sense in the 
context of negotiated rulemaking. It is envisioned by the Negotiated 
Rulemaking Act that negotiated rulemaking committees will routinely 
remain in existence until the publication of a final rule, which may 
take several years. In this specific context, the one-size-fits-all 
requirement of FACA for rechartering every 2 years, while sensible for 
advisory committees that have nonspecific oversight-type 
responsibilities, would seem somewhat arbitrary.
  I am not alone in questioning this apparent duplication. I will ask 
unanimous consent to have printed at the end of this statement a 
statement on the reauthorization of the Negotiated Rulemaking Act from 
the American Bar Association [ABA] and the formal ABA position 
statement on which it is based. The formal position of the ABA, jointly 
proposed by the ABA Standing Committee on Environmental Law, the 
Section of Administrative Law and Regulatory Practice, and the Section 
of Natural Resources, Energy, and Environmental Law, and passed by the 
ABA House of Delegates, states that--

       a federal agency should not be required to secure the 
     permission of the Office of Management and Budget or the 
     General Services Administration before it impanels a 
     committee under the Negotiated Rulemaking Act or the 
     Administrative Dispute Resolution Act, and that such agencies 
     must continue to comply with the substantive requirements of 
     the Federal Advisory Committee Act, including openness and 
     balance on committees.

  These questions of duplication are important in the real world of how 
Federal agencies operate because there is already a considerable 
transaction cost to the formation and running of advisory committees 
under FACA. The formal chartering process under FACA, in practice, 
involves numerous levels of review within agencies and is often a time-
consuming bureaucratic step. It is perhaps justifiable to impose such 
transaction costs to prevent the formation of generic advisory 
committees for which there is not a clear and compelling need. Perhaps, 
notwithstanding the current interest in having more, rather than less, 
stakeholder input into Federal agency processes and decisions, it is 
thought appropriate to view advisory committees generally as a problem 
to be contained. But the whole point of the Negotiated Rulemaking Act 
is to promote the use of one specific type of advisory committee. The 
Negotiated Rulemaking Act creates no new authorities for agencies. If 
it were to expire on November 29, of this year, as it is currently 
scheduled to do under current law, agencies could still form such 
committees and use them in the promulgation of rules. Since, then, the 
whole point of the act is to underscore Congress' intent that 
negotiated rulemaking be more widely used, we should look carefully at 
the question of administrative transaction costs in Federal agencies, 
to see if we have unwittingly put in place duplicative steps that make 
forming such committees seem to be more trouble than they are worth.
  There is evidence that this is now the case. In the National Marine 
Fisheries Service of the Department of Commerce, a proposal to form a 
negotiated rulemaking committee to resolve issues between commercial 
and sport fishing interests regarding tuna fishing in the mid-Atlantic, 
published in the Federal Register on February 1, has languished 
precisely because the Department of Commerce, like other agencies such 
as the Department of Energy, has a process for reviewing proposals to 
form advisory committees under FACA that involves sending the proposal 
to numerous offices dispersed through the agency structure for 
checkoffs on issues such as--in the case of Commerce--national security 
concerns. Transiting this sort of administrative gauntlet is a daunting 
task, even for hardened bureaucrats. Meanwhile, the underlying dispute 
that prompted the proposal to form this committee has escalated, 
perhaps to the point where getting to a consensus result has been 
imperiled by the delay resulting from administrative inefficiency. If 
the administrative duplication occasioned by the overlaps in these two 
laws did not exist, the negotiated rulemaking committee could have 
started to meet in March of this year.
  How representative is this case? It is hard to say. The permanent 
reauthorization of Negotiated Rulemaking Act was not covered in the 
hearings on this bill, so this problem was not explored on the record. 
Given this, I appreciate the willingness of the sponsors of this bill 
to address my concerns that a far greater problem may exist. Subsection 
(e) of the amendment provides for study, in the Office of Management 
and Budget, of this question, so that a complete picture of the problem 
can be obtained, and so that recommendations can be formulated. I would 
hope that the OMB review, in the spirit of reinventing Government, will 
take a careful look at such barriers and proposed best practices to 
agencies to facilitate the expeditious formation of advisory committees 
generally.
  I thank the sponsors of the bill, again, for their assistance and 
willingness to address this issue. I hope that if, in the course of the 
OMB study, the administration identifies solutions to some of these 
issues that require legislative action by Congress, that the sponsors 
will be willing to act on such suggestions.
  I ask unanimous consent that the material I earlier referred to be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:


                                     American Bar Association,

                                   Washington, DC, April 16, 1996.
     Hon. Carl Levin,
     Governmental Affairs Committee, U.S. Senate, Washington, DC.
       Dear Senator Levin: I write on behalf of the American Bar 
     Association to urge that the Administrative Dispute 
     Resolution Act and the Negotiated Rulemaking Act be 
     reauthorized on a permanent basis. We are concerned that the 
     decision regarding reassignment of negotiated rulemaking 
     responsibilities formerly carried out by the Administrative 
     Conference of the United States will prevent the 
     reauthorization of these two important laws.
       These two laws form the framework for consensus building in 
     government decision-making. The Administrative Dispute 
     Resolution Act authorizes agencies to use a full array of 
     alternative dispute resolution processes, if the parties 
     agree to do so. The Negotiated Rulemaking Act provides a 
     framework for negotiating rules among representatives of the 
     affected interests. We have reviewed the draft amendment on 
     encouraging negotiated rulemaking and offer the following 
     comments.
       (1) The ABA endorses the prompt, permanent reauthorization 
     of these two laws.
       (2) The Association would be pleased to work with you to 
     determine an appropriate alternative placement of the 
     consultative function under the Negotiated Rulemaking Act.
       (3) The ABA recommends an amendment to the draft to direct 
     that federal agencies not be required to secure the 
     permission of the Office of Management and Budget or the 
     General Service Administration before impanelling a committee 
     under the Negotiated Rulemaking Act or the Administrative 
     Dispute Resolution Act. The Association believes the 
     requirement that agencies secure permission to establish 
     committees has inhibited the wider use of these important, 
     consensus based process. However, Congress should continue to 
     require that such agencies must comply with the substantive 
     requirements of the Federal Advisory Committee Act, including 
     openness and balance on committees.
       The Negotiated Rulemaking Act and the Administrative 
     Dispute Resolution Act encourage federal agencies to explore 
     the use of mediation and consensus building to reduce costs 
     and increase responsiveness to public concerns. We look 
     forward to working with you to ensure that these laws are 
     reauthorized.
           Sincerely,
     Robert D. Evans.
                                                                    ____


  American Bar Association, Standing Committee on Environmental Law; 
Section of Administrative Law & Regulatory Practice; Section of Natural 
                 Resources, Energy & Environmental Law


                             recommendation

       Be it Resolved, That the public participation provisions of 
     local, state and federal environmental laws and international 
     environmental agreements and treaties should recognize and 
     express the principle that the

[[Page S6161]]

     public and all affected interests should be provided 
     meaningful and effective involvement and should be expected 
     to participate in consensus building efforts to ensure that 
     government decision-making regarding the administration, 
     regulation, and enforcement of environmental laws is open, 
     fair, efficient and credible; Be it further
       Resolved, That the public participation provisions of 
     local, state and federal environmental laws should include 
     express authority allowing government agencies to choose 
     innovative public participation, stakeholder-involvement and 
     shared decision-making models, including site-specific, 
     negotiated consensus-building processes and negotiated 
     rulemaking, which involve all affected stakeholders, such as 
     citizens, potentially responsible parties, and affected 
     federal, tribal, state, territorial and local governments; be 
     it further
       Resolved, That federal agencies should use more fully the 
     Administrative Dispute Resolution Act and the Negotiated 
     Rulemaking Act for making environmental decisions, and state 
     agencies should follow similar procedures permitted under 
     generally applicable provisions of administrative law; be it 
     further
       Resolved, That Congress should reauthorize the 
     Administrative Dispute Resolution Act and the Negotiated 
     Rulemaking Act on a permanent basis, and, in doing so, 
     Congress should revise provisions that inhibit their wider 
     use to resolve environmental matters by clarifying:
       (1) that the Administrative Dispute Resolution Act 
     authorizes the use of the full range of dispute resolution 
     processes for making administrative decisions, including 
     general consensus building and the resolution of issues 
     between private parties that otherwise would be decided by 
     the environmental agency;
       (2) that the decision of an arbitrator, where applicable, 
     should be final when issued, without the authority of an 
     agency to unilaterally override such decision;
       (3) that communications between a party and the neutral 
     should be protected from disclosure except for the 
     circumstances defined in the Administrative Dispute 
     Resolution Act; to that extent the Administrative Dispute 
     Resolution Act should be regarded as a Section (b)(3) 
     exemption under the Freedom of Information Act; and
       (4) that a federal agency should not be required to secure 
     the permission of the Office of Management and Budget or the 
     General Services Administration before it impanels a 
     committee under the Negotiated Rulemaking Act or the 
     Administrative Dispute Resolution Act, and that such agencies 
     must continue to comply with the substantive requirements of 
     the Federal Advisory Committee Act, including openness and 
     balance on committees; be it further
       Resolved, That the procedures described in the Negotiated 
     Rulemaking Act should be used for making policy decisions 
     under environmental statutes; be it finally
       Resolved, That the framework established under the 
     Negotiated Rulemaking Act and the Administrative Dispute 
     Resolution Act provide the means by which the U.S. 
     Environmental Protection Agency (``EPA''), community and 
     business interests, state, tribal and local governments, and 
     environmental and other non-governmental organizations can 
     reach agreement on the appropriate issues. For example, in 
     addition to existing alternative dispute resolution 
     provisions in the Comprehensive Environmental Response, 
     Compensation and Liability Act (``CERCLA''), potentially 
     responsible parties are encouraged to use the Administrative 
     Dispute Resolution Act to make allocation decisions, while 
     environmental agencies are encouraged to use the Negotiated 
     Rulemaking Act for making policy decisions. In doing so, EPA 
     should appoint a single, relatively senior official to 
     represent the agency and various components of its staff in 
     such negotiations, and policy negotiations and allocation 
     decisions should be coordinated to the extent appropriate.


                           Amendment No. 4045

(Purpose: To reauthorize the Negotiated Rulemaking Act of 1990, and for 
                            other purposes)

  Mr. LOTT. Mr. President, I understand that there is an amendment at 
the desk in behalf of Senators Levin and Grassley. I ask for its 
consideration.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       The Senator from Mississippi [Mr. Lott], for Mr. Levin, for 
     himself and Mr. Grassley, proposes an amendment numbered 
     4045.

       At the end of the bill, add the following new section:

     SEC. 11. REAUTHORIZATION OF NEGOTIATED RULEMAKING ACT OF 
                   1990.

       (a) Permanent Reauthorization.--Section 5 of the Negotiated 
     Rulemaking Act of 1990 (Public Law 101-648; 5 U.S.C. 561 
     note) is repealed.
       (b) Closure of Administrative Conference.--
       (1) In general.--Section 569 of title 5, United States 
     Code, is amended--
       (A) by amending the section heading to read as follows:

     ``Sec. 569. Encouraging negotiated rulemaking'';

     and

       (B) by striking out subsections (a) through (g) and 
     inserting in lieu thereof the following:
       ``(a) The President shall designate an agency or designate 
     or establish an interagency committee to facilitate and 
     encourage agency use of negotiated rulemaking. An agency that 
     is considering, planning or conducting a negotiated 
     rulemaking may consult with such agency or committee for 
     information and assistance.
       (b) To carry out the purposes of this subchapter, an agency 
     planning or conducting a negotiated rulemaking may accept, 
     hold, administer, and utilize gifts, devises, and bequests of 
     property, both real and personal, provided that agency 
     acceptance and use of such gifts, devises or bequests do not 
     create a conflict of interest. Gifts and bequests of money 
     and proceeds from sales of other property received as gifts, 
     devises, or bequests shall be deposited in the Treasury and 
     shall be disbursed upon the order of the head of such agency. 
     Property accepted pursuant to this section, and the proceeds, 
     thereof, shall be used as nearly as possible in accordance 
     with the terms of the gifts, devises, or bequests. For 
     purposes of Federal income, estate, or gift taxes, property 
     accepted under this section shall be considered as a gift, 
     devise, or bequest to the United States.''.
       (2) Technical and conforming amendment.--The table of 
     sections for chapter 5 of title 5, United States Code, is 
     amended by striking out the item relating to section 569 and 
     inserting in lieu thereof the following:

``569. Encouraging negotiated rulemaking.''

       (c) Expedited Hiring of Convenors and Facilitators.--
       (1) Defense agency contracts.--Section 2304(c)(3)(C) of 
     title 10, United States Code, is amended by inserting ``or 
     negotiated rulemaking'' after ``alternative dispute 
     resolution''.
       (2) Federal contracts.--Section 303(c)(3)(C) of the Federal 
     Property and Administrative Services Act of 1949 (41 U.S.C. 
     253(c)(3)(C)), is amended by inserting ``or negotiated 
     rulemaking'' after ``alternative dispute resolution''.
       (d) Authorization of Appropriations.--
       (1) In general.--Subchapter III of title 5, United States 
     Code, is amended by adding at the end thereof the following 
     new section:

     ``Sec. 570a. Authorization of appropriations

       ``There are authorized to be appropriated such sums as may 
     be necessary to carry out the purposes of this subchapter.''.
       (2) Technical and conforming amendment.--The table of 
     sections for chapter 5 of title 5, United States Code, is 
     amended by inserting after the item relating to section 570 
     the following:

``Sec. 570a Authorization of appropriations.''

       (e) Study.--No later than 180 days after the enactment of 
     this Act, the Director of the Office of Management and Budget 
     shall complete a study with recommendations on expediting the 
     establishment of negotiated rulemaking committees, including 
     eliminating any redundant administrative requirements related 
     to filing a committee charter under section 9 of the Federal 
     Advisory Committee Act and providing public notice of such 
     committee under section 564 of title 5, United States Code.

  The PRESIDING OFFICER. Without objection, the amendment is agreed to.
  The amendment (No. 4045) was agreed to.


                           Amendment No. 4046

  (Purpose: To provide the United States Court of Federal Claims with 
           exclusive jurisdiction over contract bid protests)

  Mr. LOTT. I understand Senator Cohen has an amendment at the desk, 
and I ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       The Senator from Mississippi [Mr. Lott], for Mr. Cohen, 
     proposes an amendment numbered 4046.

       At the end of the Committee amendment add the following:

     SEC. 11. JURISDICTION OF THE UNITED STATES COURT OF FEDERAL 
                   CLAIMS: BID PROTESTS.

       (a) Bid Protests.--
       (1) Termination of jurisdiction of district courts.--
     Section 1491 of title 28, United States Code, is amended--
       (A) by redesignating subsection (b) as subsection (d);
       (B) in subsection (a)--
       (i) by striking out ``(a)(1)'' and inserting in lieu 
     thereof ``(a) Claims Against the United States.--'';
       (ii) in paragraph (2), by striking out ``(2) To'' and 
     inserting in lieu thereof ``(b) Remedy and Relief.--To''; and
       (iii) by striking out paragraph (3); and
       (C) by inserting after subsection (b), as designated by 
     paragraph (1)(B)(ii), the following new subsection (c):
       ``(c) Bid Protests.--(1) The United States Court of Federal 
     Claims has jurisdiction to render judgment on an action by an 
     interested party objecting to a solicitation by a Federal 
     agency for bids or proposals for a proposed contract or to a 
     proposed award or the award of a contract. The court has 
     jurisdiction to entertain such an action without regard to 
     whether suit is instituted before or after the contract is 
     awarded.
       ``(2) To afford relief in such an action, the court may 
     award any relief that the court considers proper, including 
     declaratory and injunctive relief.

[[Page S6162]]

       ``(3) In exercising jurisdiction under this subsection, the 
     court shall give due regard to the interests of national 
     defense and national security and the need for expeditious 
     resolution of the action.
       ``(4) The district courts of the United States do not have 
     jurisdiction of any action referred to in paragraph (1).''.
       (2) Clerical amendments.--
       (A) Section heading.--The heading of such section is 
     amended by inserting ``bid protests;'' after ``generally;'',
       (B) Table of sections.--The table of sections at the 
     beginning of chapter 91 of title 28, United States Code, is 
     amended by striking out the item relating to section 1491 and 
     inserting in lieu thereof the following:

``1491. Claims against United States generally; bid protests; actions 
              involving Tennessee Valley Authority.''.

       (b) Nonexclusivity of GAO Remedies.--Section 3556 of title 
     31, United States Code, is amended by striking out ``a 
     district court of the United States or the United States 
     Claims Court'' in the first sentence and inserting in lieu 
     thereof ``the United States Court of Federal Claims''.
       (c) Savings Provisions.--
       (1) Orders.--The amendments made by this section shall not 
     terminate the effectiveness of orders that have been issued 
     by a court in connection with an action within the 
     jurisdiction of that court on the day before the effective 
     date of this section. Such orders shall continue in effect 
     according to their terms until modified, terminated, 
     superseded, set aside, or revoked by a court of competent 
     jurisdiction or by operation of law.
       (2) Proceedings and applications.--(A) The amendments made 
     by this section shall not affect the jurisdiction of a court 
     of the United States to continue with any proceeding that is 
     pending before the court on the day before the effective date 
     of this section.
       (B) Orders may be issued in any such proceeding, appeals 
     may be taken therefrom, and payments may be made pursuant to 
     such orders, as if this section had not been enacted. An 
     order issued in any such proceeding shall continue in effect 
     until modified, terminated, superseded, set aside, or revoked 
     by a court of competent jurisdiction or by operation of law.
       (C) Nothing in this paragraph prohibits the discontinuance 
     or modification of any such proceeding under the same terms 
     and conditions and to the same extent that such proceeding 
     could have been discontinued or modified if this section had 
     not been enacted.
       (d) Effective Date.--This section and the amendments made 
     by this section shall take effect on October 1, 1996.

  The PRESIDING OFFICER. Without objection, the amendment is agreed to.
  The amendment (No. 4046) was agreed to.
  Mr. LOTT. I ask unanimous consent that the committee amendment be 
agreed to, the bill then be deemed read a third time, the Senate then 
immediately proceed to Calendar No. 427, H.R. 2977; further, that all 
after the enacting clause be stricken and the text of S. 1224, as 
amended, be inserted in lieu thereof, the bill then be read a third 
time, passed, the motion to reconsider be laid upon the table, the 
Senate then insist on its amendment and request a conference with the 
House, the Chair be authorized to appoint conferees on the part of the 
Senate, the bill S. 1224 be placed back on the calendar; and, finally, 
that any statements relating to the bill be placed at the appropriate 
place in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The bill (H.R. 2977), as amended, was deemed read for the third time, 
and passed as follows:

       Resolved, That the bill from the House of Representatives 
     (H.R. 2977) entitled ``An Act to reauthorize alternative 
     means of dispute resolution in the Federal administrative 
     process, and for other purposes.'', do pass with the 
     following amendments:
       Strike out all after the enacting clause and insert:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Administrative Dispute 
     Resolution Act of 1995''.

     SEC. 2. AMENDMENT TO DEFINITIONS.

       Section 571 of title 5, United States Code, is amended--
       (1) in paragraph (3)--
       (A) by striking out ``settlement negotiations,''; and
       (B) by striking out ``and arbitration'' and inserting in 
     lieu thereof ``use of ombuds, and binding or nonbinding 
     arbitration,''; and
       (2) in paragraph (8)--
       (A) in subparagraph (B) by striking out ``decision,'' and 
     inserting in lieu thereof ``decision.''; and
       (B) by striking out the matter following subparagraph (B).

     SEC. 3. AMENDMENTS TO CONFIDENTIALITY PROVISIONS.

       (a) Termination of Availability Exemption to 
     Confidentiality.--Section 574(b) of title 5, United States 
     Code, is amended--
       (1) in paragraph (5) by adding ``or'' at the end thereof;
       (2) in paragraph (6) by striking out ``; or'' and inserting 
     in lieu thereof a period; and
       (3) by striking out paragraph (7).
       (b) Limitation of Confidentiality Application to 
     Communication.--Section 574 of title 5, United States Code, 
     is amended--
       (1) in subsection (a) in the matter before paragraph (1) by 
     striking out ``any information concerning''; and
       (2) in subsection (b) in the matter before paragraph (1) by 
     striking out ``any information concerning''.
       (c) Alternative Confidentiality Procedures.--Section 574(d) 
     of title 5, United States Code, is amended--
       (1) by inserting ``(1)'' after ``(d)''; and
       (2) by adding at the end thereof the following new 
     paragraph:
       ``(2) To qualify for the exemption established under 
     subsection (j), an alternative confidential procedure under 
     this subsection may not provide for less disclosure than the 
     confidential procedures otherwise provided under this 
     section.''.
       (d) Exemption From Disclosure by Statute.--Section 574 of 
     title 5, United States Code, is amended by striking out 
     subsection (j) and inserting in lieu thereof the following:
       ``(j) A dispute resolution communication which is generated 
     by or provided to an agency or neutral, and which may not be 
     disclosed under this section, shall also be exempt from 
     disclosure under section 552(b)(3).''.

     SEC. 4. AMENDMENT TO REFLECT THE CLOSURE OF THE 
                   ADMINISTRATIVE CONFERENCE.

       (a) Promotion of Administrative Dispute Resolutions.--
     Section 3(a)(1) of the Administrative Dispute Resolution Act 
     (5 U.S.C. 581 note; Public Law 101-552; 104 Stat. 2736) is 
     amended by striking out ``the Administrative Conference of 
     the United States and''.
       (b) Compilation of Information.--
       (1) In general.--Section 582 of title 5, United States 
     Code, is repealed.
       (2) Technical and conforming amendment.--The table of 
     sections for chapter 5 of title 5, United States Code, is 
     amended by striking out the item relating to section 582.
       (c) Federal Mediation and Conciliation Service.--Section 
     203(f) of the Labor Management Relations Act, 1947 (29 U.S.C. 
     173(f)) is amended by striking out ``the Administrative 
     Conference of the United States and''.

     SEC. 5. AMENDMENTS TO SUPPORT SERVICE PROVISION.

       Section 583 of title 5, United States Code, is amended by 
     inserting ``State, local, and tribal governments,'' after 
     ``other Federal agencies,''.

     SEC. 6. AMENDMENTS TO THE CONTRACT DISPUTES ACT.

       Section 6 of the Contract Disputes Act of 1978 (41 U.S.C. 
     605) is amended--
       (1) in subsection (d) by striking out the second sentence 
     and inserting in lieu thereof: ``The contractor shall certify 
     the claim when required to do so as provided under subsection 
     (c)(1) or as otherwise required by law.''; and
       (2) in subsection (e) by striking out the first sentence.

     SEC. 7. AMENDMENTS ON ACQUIRING NEUTRALS.

       (a) Expedited Hiring of Neutrals.--
       (1) Competitive requirements in defense agency contracts.--
     Section 2304(c)(3)(C) of title 10, United States Code, is 
     amended by striking out ``agency, or'' and inserting in lieu 
     thereof ``agency, or to procure the services of an expert or 
     neutral for use''.
       (2) Competitive requirements in federal contracts.--Section 
     303(c)(3)(C) of the Federal Property and Administrative 
     Services Act of 1949 (41 U.S.C. 253(c)(3)(C)), is amended by 
     striking out ``agency, or'' and inserting in lieu thereof 
     ``agency, or to procure the services of an expert or neutral 
     for use''.
       (b) References to the Administrative Conference of the 
     United States.--Section 573 of title 5, United States Code, 
     is amended--
       (1) by striking out subsection (c) and inserting in lieu 
     thereof the following:
       ``(c) In consultation with other appropriate Federal 
     agencies and professional organizations experienced in 
     matters concerning dispute resolution, the Federal Mediation 
     and Conciliation Service shall--
       ``(1) encourage and facilitate agency use of alternative 
     means of dispute resolution; and
       ``(2) develop procedures that permit agencies to obtain the 
     services of neutrals on an expedited basis.''; and
       (2) in subsection (e) by striking out ``on a roster 
     established under subsection (c)(2) or a roster maintained by 
     other public or private organizations, or individual''.

     SEC. 8. ARBITRATION AWARDS AND JUDICIAL REVIEW.

       (a) Arbitration Awards.--Section 580 of title 5, United 
     States Code, is amended--
       (1) by striking out subsections (c), (f), and (g); and
       (2) by redesignating subsections (d) and (e) as subsections 
     (c) and (d), respectively.
       (b) Judicial Awards.--Section 581(d) of title 5, United 
     States Code, is amended--
       (1) by striking out ``(1)'' after ``(b)''; and
       (2) by striking out paragraph (2).

     SEC. 9. PERMANENT AUTHORIZATION OF THE ALTERNATIVE DISPUTE 
                   RESOLUTION PROVISIONS OF TITLE 5, UNITED STATES 
                   CODE.

       The Administrative Dispute Resolution Act (Public Law 101-
     552; 104 Stat. 2747; 5 U.S.C. 581 note) is amended by 
     striking out section 11.

     SEC. 10. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--Subchapter IV of title 5, United States 
     Code, is amended by adding at the end thereof the following 
     new section:

     ``Sec. 584. Authorization of appropriations

       ``There are authorized to be appropriated such sums as may 
     be necessary to carry out the purposes of this subchapter.''.

[[Page S6163]]

       (b) Technical and Conforming Amendment.--The table of 
     sections for chapter 5 of title 5, United States Code, is 
     amended by inserting after the item relating to section 583 
     the following:

``Sec. 584. Authorization of appropriations.''.

     SEC. 11. REAUTHORIZATION OF NEGOTIATED RULEMAKING ACT OF 
                   1990.

       (a) Permanent Reauthorization.--Section 5 of the Negotiated 
     Rulemaking Act of 1990 (Public Law 101-648; 5 U.S.C. 561 
     note) is repealed.
       (b) Closure of Administrative Conference.--
       (1) In general.--Section 569 of title 5, United States 
     Code, is amended--
       (A) by amending the section heading to read as follows:

     ``Sec. 569. Encouraging negotiated rulemaking''; and

       (B) by striking out subsections (a) through (g) and 
     inserting in lieu thereof the following:
       ``(a) The President shall designate an agency or designate 
     or establish an interagency committee to facilitate and 
     encourage agency use of negotiated rulemaking. An agency that 
     is considering, planning or conducting a negotiated 
     rulemaking may consult with such agency or committee for 
     information and assistance.
       ``(b) To carry out the purposes of this subchapter, an 
     agency planning or conducting a negotiated rulemaking may 
     accept, hold, administer, and utilize gifts, devises, and 
     bequests of property, both real and personal:  Provided, That 
     agency acceptance and use of such gifts, devises or bequests 
     do not create a conflict of interest. Gifts and bequests of 
     money and proceeds from sales of other property received as 
     gifts, devises, or bequests shall be deposited in the 
     Treasury and shall be disbursed upon the order of the head of 
     such agency. Property accepted pursuant to this section, and 
     the proceeds thereof, shall be used as nearly as possible in 
     accordance with the terms of the gifts, devises, or bequests. 
     For purposes of Federal income, estate, or gift taxes, 
     property accepted under this section shall be considered as a 
     gift, devise, or bequest to the United States.''.
       (2) Technical and conforming amendment.--The table of 
     sections for chapter 5 of title 5, United States Code, is 
     amended by striking out the item relating to section 569 and 
     inserting in lieu thereof the following:

``569. Encouraging negotiated rulemaking.''.

       (c) Expedited Hiring of Convenors and Facilitators.--
       (1) Defense agency contracts.--Section 2304(c)(3)(C) of 
     title 10, United States Code, is amended by inserting ``or 
     negotiated rulemaking'' after ``alternative dispute 
     resolution''.
       (2) Federal contracts.--Section 303(c)(3)(C) of the Federal 
     Property and Administrative Services Act of 1949 (41 U.S.C. 
     253(c)(3)(C)), is amended by inserting ``or negotiated 
     rulemaking'' after ``alternative dispute resolution''.
       (d) Authorization of Appropriations.--
       (1) In general.--Subchapter III of title 5, United States 
     Code, is amended by adding at the end thereof the following 
     new section:

     ``Sec. 570a. Authorization of appropriations

       ``There are authorized to be appropriated such sums as may 
     be necessary to carry out the purposes of this subchapter.''.
       (2) Technical and conforming amendment.--The table of 
     sections for chapter 5 of title 5, United States Code, is 
     amended by inserting after the item relating to section 570 
     the following:

``Sec. 570a. Authorization of appropriations.''.

       (e) Study.--No later than 180 days after the enactment of 
     this Act, the Director of the Office of Management and Budget 
     shall complete a study with recommendations on expediting the 
     establishment of negotiated rulemaking committees, including 
     eliminating any redundant administrative requirements related 
     to filing a committee charter under section 9 of the Federal 
     Advisory Committee Act and providing public notice of such 
     committee under section 564 of title 5, United States Code.

     SEC. 12. JURISDICTION OF THE UNITED STATES COURT OF FEDERAL 
                   CLAIMS: BID PROTESTS.

       (a) Bid Protests.--
       (1) Termination of jurisdiction of district courts.--
     Section 1491 of title 28, United States Code, is amended--
       (A) by redesignating subsection (b) as subsection (d);
       (B) in subsection (a)--
       (i) by striking out ``(a)(1)'' and inserting in lieu 
     thereof ``(a) Claims Against the United States.--'';
       (ii) in paragraph (2), by striking out ``(2) To'' and 
     inserting in lieu thereof ``(b) Remedy and Relief.--To''; and
       (iii) by striking out paragraph (3); and
       (C) by inserting after subsection (b), as designated by 
     paragraph (1)(B)(ii), the following new subsection (c):
       ``(c) Bid Protests.--(1) The United States Court of Federal 
     Claims has jurisdiction to render judgment on an action by an 
     interested party objecting to a solicitation by a Federal 
     agency for bids or proposals for a proposed contract or to a 
     proposed award or the award of a contract. The court has 
     jurisdiction to entertain such an action without regard to 
     whether suit is instituted before or after the contract is 
     awarded.
       ``(2) To afford relief in such an action, the court may 
     award any relief that the court considers proper, including 
     declaratory and injunctive relief.
       ``(3) In exercising jurisdiction under this subsection, the 
     court shall give due regard to the interests of national 
     defense and national security and the need for expeditious 
     resolution of the action.
       ``(4) The district courts of the United States do not have 
     jurisdiction of any action referred to in paragraph (1).''.
       (2) Clerical amendments.--
       (A) Section heading.--The heading of such section is 
     amended by inserting ``bid protests;'' after ``generally;''.
       (B) Table of sections.--The table of sections at the 
     beginning of chapter 91 of title 28, United States Code, is 
     amended by striking out the item relating to section 1491 and 
     inserting in lieu thereof the following:

``1491. Claims against United States generally; bid protests; actions 
              involving Tennessee Valley Authority.''.

       (b) Nonexclusivity of GAO Remedies.--Section 3556 of title 
     31, United States Code, is amended by striking out ``a 
     district court of the United States or the United States 
     Claims Court'' in the first sentence and inserting in lieu 
     thereof ``the United States Court of Federal Claims''.
       (c) Savings Provisions.--
       (1) Orders.--The amendments made by this section shall not 
     terminate the effectiveness of orders that have been issued 
     by a court in connection with an action within the 
     jurisdiction of that court on the day before the effective 
     date of this section. Such orders shall continue in effect 
     according to their terms until modified, terminated, 
     superseded, set aside, or revoked by a court of competent 
     jurisdiction or by operation of law.
       (2) Proceedings and applications.--(A) The amendments made 
     by this section shall not affect the jurisdiction of a court 
     of the United States to continue with any proceeding that is 
     pending before the court on the day before the effective date 
     of this section.
       (B) Orders may be issued in any such proceeding, appeals 
     may be taken therefrom, and payments may be made pursuant to 
     such orders, as if this section had not been enacted. An 
     order issued in any such proceeding shall continue in effect 
     until modified, terminated, superseded, set aside, or revoked 
     by a court of competent jurisdiction or by operation of law.
       (C) Nothing in this paragraph prohibits the discontinuance 
     or modification of any such proceeding under the same terms 
     and conditions and to the same extent that such proceeding 
     could have been discontinued or modified if this section had 
     not been enacted.
       (d) Effective Date.--This section and the amendments made 
     by this section shall take effect on October 1, 1996.

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