[Congressional Record (Bound Edition), Volume 151 (2005), Part 17]
[Senate]
[Pages 22955-22956]
[From the U.S. Government Publishing Office, www.gpo.gov]




                   REPEAL OF MICROPURCHASE AUTHORITY

  Mr. GRASSLEY. Mr. President, I rise today to speak regarding the 
repeal of expanded Federal Government micro-purchase limits, as well as 
to speak regarding recent regulatory action taken by the Office of 
Management and Budget on this matter.
  We are all deeply concerned with the recent events surrounding 
Hurricane Katrina and the massive rebuilding and reconstruction efforts 
ongoing in the gulf coast.
  While we all agree that help is needed, many have argued how best to 
provide this help. The second supplemental emergency appropriation for 
Hurricane Katrina included a number of provisions to help provide for 
rebuilding and reconstruction--including nearly $61 billion.
  This money will help rebuild the gulf coast, yet there were some 
provisions in that second supplemental that leave the rebuilding effort 
vulnerable to fraud, waste, and abuse of taxpayer dollars.
  One such provision was the repeal of the limitations on micropurchase 
spending authority. Micropurchases represent delegated buying authority 
for Federal agencies and were designed to save money by providing 
flexible spending. Micropurchases are usually small--averaging $600--
and are most often made through Government credit cards.
  By law these Government credit card micropurchases were originally 
capped at $2,500 per purchase. This limit was raised following 9/11 for 
emergency purposes only, to $15,000 domestically and $25,000 abroad.
  The second Hurricane Katrina supplemental raised this emergency rate 
from $15,000 to $250,000, per purchase. This change represents a nearly 
1600 percent increase. Imagine a Government bureaucrat being able to 
walk into a store, purchase an item for $250,000 without prior 
approval, and say, ``Put it on the taxpayer's tab.''
  History has proven that these Government credit cards are prone to 
fraud, waste and abuse of taxpayer funds. I began looking into this 
issue several years ago. Working with the Government Accountability 
Office, GAO, and the various inspectors general over the years, I have 
uncovered hundreds of millions of dollars lost to fraud, waste, and 
abuse due to inadequate controls on Government credit cards.
  This history of abuse prompted my immediate attention and 
intervention with OMB regarding the increased threshold. Through 
negotiations during the critical early hours following the passage of 
the micropurchase increase, OMB agreed to issue guidance which provided 
a temporary limit on who could utilize the new limits. This guidance 
helped to prevent undocumented spending and potential abuse; however, 
it only served as a temporary stop-gap measure.
  On September 15, I introduced legislation on this topic. The bill 
introduced, S. 1716--the Emergency Health Care Relief Act of 2005--
contained a provision that would roll back the increased micropurchase 
thresholds to a responsible level while maintaining flexibility for 
those providing relief in the impacted Gulf States. I included this 
provision in the bill I introduced because of my experience in fighting 
fraud, waste, and abuse that has occurred as a result of Government 
credit cards.
  Unfortunately, S. 1716 has been held up in this body for too long, 
preventing legislation from fixing this potential giveaway and delaying 
health care to those most desperately in need.
  I was pleased to hear that Senators Dorgan and Wyden have voiced 
their concerns by recently introducing legislation on this matter. I am 
also pleased that legislation which was introduced by Senators Collins 
and Lieberman on this matter was recently reported out of Committee in 
a favorable voice vote. Both of these bills represent what I believe is 
the sense of Congress, that this increased limit must be reduced 
statutorily.
  On October 3, OMB revised its guidance for micropurchases, reducing 
the increased limits from $250,000 to $2,500, the same correction 
sought in the different legislation introduced by Senators Collins and 
Lieberman and the subsequent legislation by Senators Dorgan and Wyden. 
I applaud OMB for stepping forward and taking corrective action; 
however, I remain concerned that this limit could be changed by OMB at 
any time as the increased limit still remains in the law.
  Fortunately, OMB has listened to my recommendations and recognized 
the

[[Page 22956]]

need to rescind this provision and is now supporting efforts to provide 
a legislative fix. I have learned from OMB that all agencies within the 
Government have agreed that the higher limit is unnecessary and also 
support reducing the increased limit.
  The micropurchase threshold increase needs to be repealed permanently 
by Congress and not merely corrected through regulatory guidance. As 
this body continues to hold up action on S. 1716, the best option for 
quick and decisive action to reduce this increased credit limit is to 
support the legislation introduced by Senators Collins and Lieberman 
which was recently voted out by the Committee on Homeland Security and 
Government Affairs.
  S. 1716 remains an important piece of legislation providing health 
care for those who have been affected by the tragedy in the Gulf 
States. By no means should my support of this legislation be seen as 
reducing the need to pass S. 1716 however; it just makes sense for this 
body to move quickly in closing this potential loophole for fraud, 
waste, and abuse.
  I urge all my colleagues to join me in supporting quick passage of 
both S. 1716 and the legislation offered by Senators Collins and 
Lieberman, to help prevent relief dollars from being lost to fraud, 
waste, and abuse and provide the much needed health care to the region 
devastated by Hurricane Katrina.

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