[Congressional Record Volume 163, Number 185 (Monday, November 13, 2017)]
[House]
[Pages H9143-H9145]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
FEDERAL ACQUISITION SAVINGS ACT OF 2017
Mr. JODY B. HICE of Georgia. Mr. Speaker, I move to suspend the rules
and pass the bill (H.R. 3071) to require executive agencies to consider
equipment rental in any cost-effectiveness analysis for equipment
acquisition, and for other purposes, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 3071
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Federal Acquisition Savings
Act of 2017''.
SEC. 2. COST-EFFECTIVENESS ANALYSIS OF EQUIPMENT RENTAL.
(a) Cost-Effectiveness Analysis of Equipment Rental.--
(1) In general.--With respect to any cost-effectiveness
analysis for equipment acquisition conducted on or after the
date that is 180 days after the date of the enactment of this
Act, the head of each executive agency shall consider
equipment rental in such cost-effectiveness analysis.
(2) Federal acquisition regulation.--The Federal
Acquisition Regulation shall be revised to implement the
requirement under paragraph (1).
(b) Study of Cost-Effectiveness Analysis.--Not later than
two years after the date of the enactment of this Act, the
Comptroller General of the United States shall submit to the
Committee on Oversight and Government Reform of the House of
Representatives and the Committee on Homeland Security and
Governmental Affairs of the Senate a comprehensive report on
the decisions made by the executive agencies with the highest
levels of acquisition spending, and a sample of executive
agencies with lower levels of acquisition spending, to
acquire high-value equipment by lease, rental, or purchase
pursuant to subpart 7.4 of the Federal Acquisition
Regulation.
(c) Definitions.--In this section:
(1) Equipment rental.--The term ``equipment rental'' means
the acquisition of equipment by contract from a commercial
source for a temporary period of use with no fixed duration.
(2) Executive agency.--The term ``executive agency'' has
the meaning given that term in section 102 of title 40,
United States Code.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Georgia (Mr. Jody B. Hice) and the gentlewoman from Illinois (Ms.
Kelly) each will control 20 minutes.
[[Page H9144]]
The Chair recognizes the gentleman from Georgia.
General Leave
Mr. JODY B. HICE of Georgia. Mr. Speaker, I ask unanimous consent
that all Members may have 5 legislative days within which to revise and
extend their remarks and include extraneous material on the bill under
consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Georgia?
There was no objection.
Mr. JODY B. HICE of Georgia. Mr. Speaker, I yield myself such time as
I may consume.
Mr. Speaker, I rise today in support of H.R. 3071, introduced by my
colleague from Georgia (Mr. Carter), and which I have cosponsored.
The Federal Acquisition Savings Act of 2017 would require the
government to consider renting equipment over buying or leasing that
equipment. The Government Accountability Office reported that agencies
annually spend an average of more than $200 billion on purchasing or
leasing equipment, with purchasing accounting for almost all of that
spending.
The Federal Acquisition Savings Act of 2017 provides an opportunity
to save money when obtaining equipment. The current rules encourage
agencies to consider the most cost-effective way to obtain equipment,
but only between purchasing or leasing. Renting is not an option.
H.R. 3071 requires agencies to consider renting equipment as a cost-
saving measure over purchasing or leasing. The bill also directs that
the Federal Acquisition Regulation be revised to implement this policy.
Renting equipment can provide a more cost-effective and flexible
alternative to buying or leasing.
When purchasing equipment, the purchaser makes a long-term investment
and assumes the total cost of ownership for that equipment. However,
some short-term needs can be met without assuming the cost of
purchasing and maintaining equipment. Leasing or renting are options in
such cases. Leasing should be considered, but, depending on an agency's
needs, leasing may not be the best low-cost option. Typically, leases
involve defined leasing periods and are specific to a single piece of
equipment.
In addition, leasing may require a large upfront outlay of capital,
and, under a lease, the government is generally responsible for the
cost of maintenance, insurance, and storage of the equipment.
Alternatively, rental for a temporary period with no fixed duration may
fit the need and provide a more flexible option.
{time} 1630
Renting equipment may be cost-effective because rental agreements
typically cover costs such as storage, maintenance, insurance,
transport, and licensing.
Other State and local governments have used the equipment rental
option with great success, but the Federal Government has not widely
adopted this low-cost option. For example, the Texas Department of
Transportation reported saving $10.8 million due to a rental program.
They reported renting more than 1,200 pieces of equipment at a cost of
$18.9 million and purchasing 931 assets costing more than $40 million.
The Mississippi Department of Transportation commissioned a study on
their equipment management processes and systems, and that study found
that renting equipment, such as bulldozers and motor graders, to
supplement their fleet was the most cost-effective option. In fact,
that study found that Mississippi could realize over $13,000 in annual
cost savings and $180,000 in lifecycle cost savings per bulldozer unit.
H.R. 3071 presents an opportunity to realize cost savings in
obtaining equipment by directing agencies to consider the rental
option.
Mr. Speaker, I want to thank Representative Buddy Carter for his
leadership on this bill. I urge my colleagues to support it, and I
reserve the balance of my time.
Ms. KELLY of Illinois. Mr. Speaker, I yield myself such time as I may
consume.
H.R. 3071, the Federal Acquisition Savings Act, as amended, would
require Federal contracting officers to consider short-term rentals in
addition to long-term leasing or purchasing when acquiring equipment
agencies need. I would like to thank Chairman Gowdy and Representative
Carter for working with the minority in a bipartisan manner to address
concerns that were raised about the bill as introduced.
The Federal Acquisition Regulation is currently unclear about whether
short-term rentals are permitted. Rental equipment, as opposed to
purchasing or leasing, can be a cost-effective option for Federal
agencies in certain circumstances.
This bill would provide additional flexibility by allowing such
rentals. It would also improve efficiency by requiring the cost-
effectiveness of renting to be considered by Federal contracting
officers. I support giving contracting officers additional tools to
make the most cost-effective decisions.
The bill, as amended, also would require GAO to produce a report card
on the use of renting or leasing by Federal agencies. The requirements
for that report were very burdensome for GAO in the bill as introduced.
I know we all value GAO's work and want to make the best use of its
resources. I am glad that those reporting requirements have been
streamlined.
Mr. Speaker, I reserve the balance of my time.
Mr. JODY B. HICE of Georgia. Mr. Speaker, it is my honor and
privilege to yield such time as he may consume to the gentleman from
Georgia (Mr. Carter), the sponsor of the bill.
Mr. CARTER of Georgia. Mr. Speaker, I thank the gentleman for
yielding.
Mr. Speaker, I rise today in support of my legislation, H.R. 3071,
the Federal Acquisition Savings Act of 2017. This legislation seeks to
modernize our government's outdated acquisition strategies, while
simultaneously acting as good stewards of valuable taxpayer dollars.
My bill would simply require Federal agencies to consider renting as
a cost-effective alternative in equipment acquisition, giving the
government options that the private sector has undertaken and has seen
success and cost savings with.
As previously reported by the Government Accountability Office, the
GAO, the Federal Government spends more than $200 billion, on average,
either purchasing or leasing equipment. Of those acquisition decisions,
purchasing of equipment accounts for more than 99 percent of that
share.
Federal agencies are instructed to consider the cost-effectiveness of
these strategies as they move through the process, but even that has
been found to be lacking. The GAO has found that, in many instances,
Federal agencies don't even bother to undertake these analyses. That
means that the taxpayers are the ones who lose out as Federal agencies
sidestep these responsibilities and undertake what is, many times, the
easiest but most expensive route--purchasing.
This is an issue the committee and this body have been looking at for
years. In 2012, the GAO issued a report finding that contracting
officials from the Air Force and Department of the Interior did not
perform the lease-versus-purchase analysis for many of the contracts
awarded. In July of 2013, GSA issued an RFI seeking to determine if
there is a distinction between leasing and renting of equipment. The
overwhelming response to the RFI indicated that amending the Federal
Acquisition Regulation, the FAR, to include renting would be pertinent.
However, the GSI did not act on that recommendation.
These actions have resulted in this legislation and the good-faith
effort to ensure taxpayer dollars are spent wisely and that the Federal
requirements for Federal acquisition are followed.
Under subpart 7.4 of the FAR, agencies are directed to conduct a
case-by-case evaluation of the cost between leasing and purchasing. As
I mentioned earlier, many of those analyses aren't conducted.
Amending this part of FAR will open up new avenues and will allow
them to pursue successes and cost savings being used in the private
sector. For instance, the Texas Department of Transportation reported
savings of $10.8 million within the fleet operations division. These
savings are realized when the additional costs of ownership are
factored, including maintenance, transportation, and other areas.
[[Page H9145]]
In addition to this example, the Mississippi Department of
Transportation commissioned a study finding that they could find
significant cost savings per unit if they utilized renting equipment as
an option. Rental agreements are often thought of as short-term
transactions with no fixed duration. This gives the renter--in this
case, the Federal agencies--more say in how the equipment is used and
the duration of the need for that equipment. For instance, specialized
equipment that is only needed several times a year or is needed in
varying locations can be sourced via renting to reduce overhead costs.
As this body continues to pursue meaningful legislation to reduce the
burden on our constituents and streamline the government, this is a
great step forward. My bipartisan legislation will reduce waste in the
Federal Government while giving them the opportunity to pursue new and
innovative ways to source equipment.
Too often, we see areas of mismanagement within the Federal
Government that can and should be addressed, and this is a chance to
help correct the ship one step at a time.
This bipartisan legislation passed the Oversight and Government
Reform Committee with overwhelming support, and I thank my colleagues
on the committee and on this bill for their support and persistence in
addressing shortfalls in the Federal Government.
Mr. Speaker, please join me in support of this legislation and help
us ensure future acquisition decisions are done with the taxpayers in
mind.
Ms. KELLY of Illinois. Mr. Speaker, I yield back the balance of my
time.
Mr. JODY B. HICE of Georgia. Mr. Speaker, I am grateful for this
bill, and I urge its adoption.
Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Georgia (Mr. Jody B. Hice) that the House suspend the
rules and pass the bill, H.R. 3071, as amended.
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds
being in the affirmative, the ayes have it.
Mr. JODY B. HICE of Georgia. Mr. Speaker, on that, I demand the yeas
and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further
proceedings on this motion will be postponed.
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