[Congressional Record Volume 144, Number 105 (Thursday, July 30, 1998)]
[Senate]
[Pages S9504-S9506]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




            FEDERAL ACTIVITIES INVENTORY REFORM ACT OF 1998

  Mr. JEFFORDS. Mr. President, I ask unanimous consent that the Senate 
now proceed to the consideration of Calendar No. 502, S. 314.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       A bill (S. 314) to require that the Federal Government 
     procure from the private sector the goods and services 
     necessary for the operations and management of certain 
     Government agencies, and for other purposes.


[[Page S9505]]


  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 there of the following:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Federal Activities Inventory 
     Reform Act of 1998''.

     SEC. 2. ANNUAL LISTS OF GOVERNMENT ACTIVITIES NOT INHERENTLY 
                   GOVERNMENTAL IN NATURE.

       (a) Lists Required.--Not later than the end of the third 
     quarter of each fiscal year, the head of each executive 
     agency shall submit to the Director of the Office of 
     Management and Budget a list of activities performed by 
     Federal Government sources for the executive agency that, in 
     the judgment of the head of the executive agency, are not 
     inherently governmental functions. The entry for an activity 
     on the list shall include the following:
       (1) The fiscal year for which the activity first appeared 
     on a list prepared under this section.
       (2) The number of full-time employees (or its equivalent) 
     that are necessary for the performance of the activity by a 
     Federal Government source.
       (3) The name of a Federal Government employee responsible 
     for the activity from whom additional information about the 
     activity may be obtained.
       (b) OMB Review and Consultation.--The Director of the 
     Office of Management and Budget shall review the executive 
     agency's list for a fiscal year and consult with the head of 
     the executive agency regarding the content of the final list 
     for that fiscal year.
       (c) Public Availability of Lists.--
       (1) Publication.--Upon the completion of the review and 
     consultation regarding a list of an executive agency--
       (A) the head of the executive agency shall promptly 
     transmit a copy of the list to Congress and make the list 
     available to the public; and
       (B) the Director of the Office of Management and Budget 
     shall promptly publish in the Federal Register a notice that 
     the list is available to the public.
       (2) Changes.--If the list changes after the publication of 
     the notice as a result of the resolution of a challenge under 
     section 3, the head of the executive agency shall promptly--
       (A) make each such change available to the public and 
     transmit a copy of the change to Congress; and
       (B) publish in the Federal Register a notice that the 
     change is available to the public.
       (d) Competition Required.--Within a reasonable time after 
     the date on which a notice of the public availability of a 
     list is published under subsection (c), the head of the 
     executive agency concerned shall review the activities on the 
     list. Each time that the head of the executive agency 
     considers contracting with a private sector source for 
     the performance of such an activity, the head of the 
     executive agency shall use a competitive process to select 
     the source (except as may otherwise be provided in a law 
     other than this Act, an Executive order, regulations, or 
     any Executive branch circular setting forth requirements 
     or guidance that is issued by competent executive 
     authority). The Director of the Office of Management and 
     Budget shall issue guidance for the administration of this 
     subsection.
       (e) Realistic and Fair Cost Comparisons.--For the purpose 
     of determining whether to contract with a source in the 
     private sector for the performance of an executive agency 
     activity on the list on the basis of a comparison of the 
     costs of procuring services from such a source with the costs 
     of performing that activity by the executive agency, the head 
     of the executive agency shall ensure that all costs 
     (including the costs of quality assurance, technical 
     monitoring of the performance of such function, liability 
     insurance, employee retirement and disability benefits, and 
     all other overhead costs) are considered and that the costs 
     considered are realistic and fair.

     SEC. 3. CHALLENGES TO THE LIST.

       (a) Challenge Authorized.--An interested party may submit 
     to an executive agency a challenge of an omission of a 
     particular activity from, or an inclusion of a particular 
     activity on, a list for which a notice of public availability 
     has been published under section 2.
       (b) Interested Party Defined.--For the purposes of this 
     section, the term ``interested party'', with respect to an 
     activity referred to in subsection (a), means the following:
       (1) A private sector source that--
       (A) is an actual or prospective offeror for any contract, 
     or other form of agreement, to perform the activity; and
       (B) has a direct economic interest in performing the 
     activity that would be adversely affected by a determination 
     not to procure the performance of the activity from a private 
     sector source.
       (2) A representative of any business or professional 
     association that includes within its membership private 
     sector sources referred to in paragraph (1).
       (3) An officer or employee of an organization within an 
     executive agency that is an actual or prospective offeror to 
     perform the activity.
       (4) The head of any labor organization referred to in 
     section 7103(a)(4) of title 5, United States Code, that 
     includes within its membership officers or employees of an 
     organization referred to in paragraph (3).
       (c) Time for Submission.--A challenge to a list shall be 
     submitted to the executive agency concerned within 30 days 
     after the publication of the notice of the public 
     availability of the list under section 2.
       (d) Initial Decision.--Within 28 days after an executive 
     agency receives a challenge, an official designated by the 
     head of the executive agency shall--
       (1) decide the challenge; and
       (2) transmit to the party submitting the challenge a 
     written notification of the decision together with a 
     discussion of the rationale for the decision and an 
     explanation of the party's right to appeal under subsection 
     (e).
       (e) Appeal.--
       (1) Authorization of appeal.--An interested party may 
     appeal an adverse decision of the official to the head of the 
     executive agency within 10 days after receiving a 
     notification of the decision under subsection (d).
       (2) Decision on appeal.--Within 10 days after the head of 
     an executive agency receives an appeal of a decision under 
     paragraph (1), the head of the executive agency shall decide 
     the appeal and transmit to the party submitting the appeal a 
     written notification of the decision together with a 
     discussion of the rationale for the decision.

     SEC. 4. APPLICABILITY.

       (a) Executive Agencies Covered.--Except as provided in 
     subsection (b), this Act applies to the following executive 
     agencies:
       (1) Executive department.--An executive department named in 
     section 101 of title 5, United States Code.
       (2) Military department.--A military department named in 
     section 102 of title 5, United States Code.
       (3) Independent establishment.--An independent 
     establishment, as defined in section 104 of title 5, United 
     States Code.
       (b) Exceptions.--This Act does not apply to or with respect 
     to the following:
       (1) General accounting office.--The General Accounting 
     Office.
       (2) Government corporation.--A Government corporation or a 
     Government controlled corporation, as those terms are defined 
     in section 103 of title 5, United States Code.
       (3) Nonappropriated funds instrumentality.--A part of a 
     department or agency if all of the employees of that part of 
     the department or agency are employees referred to in section 
     2105(c) of title 5, United States Code.
       (4) Certain depot-level maintenance and repair.--Depot-
     level maintenance and repair of the Department of Defense (as 
     defined in section 2460 of title 10, United States Code).

     SEC. 5. DEFINITIONS.

       In this Act:
       (1) Federal government source.--The term ``Federal 
     Government source'', with respect to performance of an 
     activity, means any organization within an executive agency 
     that uses Federal Government employees to perform the 
     activity.
       (2) Inherently governmental function.--
       (A) Definition.--The term ``inherently governmental 
     function'' means a function that is so intimately related to 
     the public interest as to require performance by Federal 
     Government employees.
       (B) Functions included.--The term includes activities that 
     require either the exercise of discretion in applying Federal 
     Government authority or the making of value judgments in 
     making decisions for the Federal Government, including 
     judgments relating to monetary transactions and entitlements. 
     An inherently governmental function involves, among other 
     things, the interpretation and execution of the laws of the 
     United States so as--
       (i) to bind the United States to take or not to take some 
     action by contract, policy, regulation, authorization, order, 
     or otherwise;
       (ii) to determine, protect, and advance United States 
     economic, political, territorial, property, or other 
     interests by military or diplomatic action, civil or criminal 
     judicial proceedings, contract management, or otherwise;
       (iii) to significantly affect the life, liberty, or 
     property of private persons;
       (iv) to commission, appoint, direct, or control officers or 
     employees of the United States; or
       (v) to exert ultimate control over the acquisition, use, or 
     disposition of the property, real or personal, tangible or 
     intangible, of the United States, including the collection, 
     control, or disbursement of appropriated and other Federal 
     funds.
       (C) Functions excluded.--The term does not normally 
     include--
       (i) gathering information for or providing advice, 
     opinions, recommendations, or ideas to Federal Government 
     officials; or
       (ii) any function that is primarily ministerial and 
     internal in nature (such as building security, mail 
     operations, operation of cafeterias, housekeeping, facilities 
     operations and maintenance, warehouse operations, motor 
     vehicle fleet management operations, or other routine 
     electrical or mechanical services).

     SEC. 6. EFFECTIVE DATE.

       This Act shall take effect on October 1, 1998.

  Mr. THOMPSON. Mr. President, S. 314, originally sponsored by Senators 
Thomas, among others, and Congressman Duncan in the House, was ordered 
reported by the Governmental Affairs Committee on July 15, 1998. The 
original S. 314 has had long and contentious past. The bill reported by 
our Committee represents months of drafting and redrafting to create 
language which truly represents a consensus.
  I commend the original sponsors of this bill for their dedication to 
this issue and their willingness to accommodate the Governmental 
Affairs Committee's changes in order to develop legislation which could 
be supported by all sides. Interested industry groups

[[Page S9506]]

have expressed their support of this legislation. And the 
Administration and the Federal employee unions, although opposed to the 
original S. 314, all have indicated they will not object to this 
legislation.
  S. 314 would require Federal agencies prepare a list of activities 
that are not inherently governmental functions that are being performed 
by Federal employees, submit that list to OMB for review, and make the 
list publicly available. It also would establish an ``appeals'' process 
within each agency to challenge what is on the list or what is not 
included on the list. S. 314 also would create a statutory definition--
identical to current regulation--for what is an ``inherently 
governmental function'' that must be performed by the government and 
not the private sector.
  S. 314 adheres to the seven principles the Administration outlined in 
its testimony to this Committee. It reflects recommendations made by 
the General Accounting Office in testimony to this and other 
committees. And it provides a statutory basis for longstanding 
administrative policy.
  Mr. JEFFORDS. Mr. President, I ask unanimous consent that the 
committee amendment be agreed to.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The committee amendment was agreed to.
  Mr. JEFFORDS. Mr. President, I ask unanimous consent that the bill be 
considered read a third time and passed, as amended; that the motion to 
reconsider be laid upon the table; that the title amendment be agreed 
to; and that any statements relating to the bill appear at the 
appropriate place in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The bill (S. 314) was considered read the third time and passed.
  The title was amended so as to read:

       ``A bill to provide a process for identifying the functions 
     of the Federal Government that are not inherently 
     governmental functions, and for other purposes.''.

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