Senate Report 110-201 - ACCOUNTABILITY IN GOVERNMENT CONTRACTING ACT OF 2007

[Senate Report 110-201]
[From the U.S. Government Publishing Office]

Calendar No. 420
110th Congress Report
1st Session SENATE 110-201 _______________________________________________________________________

ACCOUNTABILITY IN GOVERNMENT CONTRACTING ACT OF 2007

__________

R E P O R T

of the

COMMITTEE ON HOMELAND SECURITY AND

GOVERNMENTAL AFFAIRS

UNITED STATES SENATE

to accompany

S. 680

TO ENSURE PROPER OVERSIGHT AND ACCOUNTABILITY IN FEDERAL CONTRACTING,
AND FOR OTHER PURPOSES

October 22, 2007.--Ordered to be printed

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii TED STEVENS, Alaska
THOMAS R. CARPER, Delaware GEORGE V. VOINOVICH, Ohio
MARK L. PRYOR, Arkansas NORM COLEMAN, Minnesota
MARY L. LANDRIEU, Louisiana TOM COBURN, Oklahoma
BARACK OBAMA, Illinois PETE V. DOMENICI, New Mexico
CLAIRE McCASKILL, Missouri JOHN WARNER, Virginia
JON TESTER, Montana JOHN E. SUNUNU, New Hampshire

Michael L. Alexander, Staff Director
Kevin J. Landy, Chief Counsel
Troy H. Cribb, Counsel
Timothy J. DiNapoli, GAO Detailee
Brandon L. Milhorn, Minority Staff Director and Chief Counsel
Amy L. Hall, Minority Professional Staff Member
David A. Drabkin, Minority GSA Detailee
Trina Driessnack Tyrer, Chief Clerk

C O N T E N T S

Page
I. Purpose and Summary..............................................1
II. Background and Need for the Legislation..........................1
III. Legislative History..............................................7
IV. Section-by-Section Analysis......................................7
V. Evaluation of Regulatory Impact.................................23
VI. Congressional Budget Office Cost Estimate.......................23
VII. Changes in Existing Law Made by the Bill, as Reported...........26

Calendar No. 420
110th Congress Report
SENATE
1st Session 110-201

======================================================================

ACCOUNTABILITY IN GOVERNMENT CONTRACTING ACT OF 2007

_______

October 22, 2007.--Ordered to be printed

_______

Mr. Lieberman, from the Committee on Homeland Security and
Governmental Affairs, submitted the following

R E P O R T

[To accompany S. 680]

The Committee on Homeland Security and Governmental
Affairs, to which was referred the bill (S. 680), to ensure
proper oversight and accountability in Federal contracting, and
for other purposes, having considered the same reports
favorably thereon with an amendment and recommends that the
bill, as amended, do pass.

I. Purpose and Summary

The purpose of S. 680 is to provide for improved oversight
and accountability in federal contracting. The bill creates new
mechanisms for strengthening the federal government's
acquisition workforce and requires changes in policies and
procedures necessary to improve the overall performance of the
federal government's acquisition system.

II. Background and Need for the Legislation

TODAY'S ACQUISITION SYSTEM

The U.S. government's acquisition system is the largest in
the world. The U.S. government spends in excess of $400 billion
annually on the purchase of goods, services and real property--
an amount that exceeds the gross domestic product of most
countries in the world. The U.S. government buys at least one
of just about every product available in the market (``off-the-
shelf'' products), as well as goods and services that are
developed specifically for use by the government in providing
services for the American citizen.
To ensure integrity in the acquisition process, federal
acquisition law is premised on the principles of competition
and transparency. Over the past several years, though, it has
become apparent to this Committee, and to many others within
and outside government, that the current system faces a number
of significant challenges that have called into question the
government's capacity to meet current and future acquisition
needs efficiently. Systemic problems include shortages of
trained acquisition personnel; the absence of effective
competition and the lack of transparency in too many
acquisitions; poor planning and oversight of contracts by
agencies; and the frequent inability, or unwillingness, of
agencies to hold contractors accountable for poor acquisition
outcomes. These deficiencies are all too evident in the
government's response to Hurricanes Katrina and Rita, in the
post-conflict reconstruction efforts in Afghanistan and Iraq,
and in everyday government programs. Such problems cause the
American people to question the ability of the federal
government to spend taxpayer dollars wisely. The Committee
unequivocally shares the views of the Comptroller General of
the United States expressed before the Committee on July 17,
2007 that the government should have a zero tolerance policy
for waste and mismanagement, whether in times of surplus or
deficit, and that much more can and should be done to minimize
misuse of funds. While the Committee believes that the majority
of contracting is done properly, even a small percentage of
waste results in a loss of billions of dollars every year. It
is critical that Congress and the Executive Branch continuously
strive to improve the acquisition system.
S. 680, the Accountability in Government Contracting Act of
2007, draws on lessons learned by the Committee through its own
oversight of federal acquisition, the extensive analysis of the
Government Accountability Office (GAO), numerous reports of
Inspectors General and auditors across the federal government,
and, as described below, the report of the Acquisition Advisory
Panel. This extensive body of work leads the Committee to
conclude, as has the President's Council on Integrity and
Efficiency,\1\ that acquisition management is one of the top
management challenges facing the federal government. Many
government operations on GAO's ``High-Risk List''--those
suffering from severe mismanagement or highly vulnerable to
waste, fraud, and abuse--directly relate to acquisition,
including contract management at the Departments of Defense
(DOD) and Energy (DOE), and the National Aeronautics and Space
Administration (NASA); DOD weapons acquisitions; the
transformation of DHS; and the management of interagency
contracts. The Comptroller General testified before the
Committee that the government, as a whole, faces serious and
systemic acquisition challenges.
---------------------------------------------------------------------------
\1\ The President's Council on Integrity and Efficiency is
comprised primarily of Presidentially-appointed Inspectors General.
---------------------------------------------------------------------------
In 2003 Congress created the Acquisition Advisory Panel,\2\
which was tasked with the review of laws, regulations, and
governmentwide acquisition policies regarding the use of
commercial practices, performance-based contracting, the
performance of acquisition functions across agency lines of
responsibility, and governmentwide acquisition contracts. The
Panel was comprised of 14 members reflecting considerable
experience and expertise in federal acquisition issues. Over a
period of 18 months, the Panel held 31 public meetings,
received testimony from more than 100 witnesses, and reviewed
countless reports published by the GAO and agency Inspectors
General, among others. In January 2007, the Panel issued its
final report, which made 91 recommendations to improve the
government's acquisition of services.\3\ The Committee
carefully reviewed the Panel's report and heard testimony from
the Panel's Chairman on July 17, 2007. S. 680 reflects a number
of the Panel's recommendations and requires the Office of
Management and Budget (OMB) to report on further actions taken
to implement the Panel's recommendations.
---------------------------------------------------------------------------
\2\ The Acquisition Advisory Panel (also referred to as the SARA
Panel or the 1423 Panel) was authorized by Section 1423 of the Services
Acquisition Reform Act of 2003, enacted as title XIV of the National
Defense Authorization Act for Fiscal Year 2004 (Public Law 108-136,
Nov. 23, 2003).
\3\ Report of the Acquisition Advisory Panel to the Office of
Federal Procurement Policy and the United States Congress
(``Acquisition Advisory Panel Report''). January 2007.
---------------------------------------------------------------------------

THE ACQUISITION WORKFORCE

The acquisitions made daily across the government are
accomplished by the federal government's acquisition workforce,
which numbers between 130,000 and 180,000 employees, most of
whom work in the DOD.\4\ While it is not known exactly how many
employees are in the acquisition workforce as a whole, it is
clear that in certain segments of the acquisition workforce the
government is understaffed. For example, the number of contract
specialists, the career series from which the vast majority of
the government's contracting officers is drawn, has actually
decreased since 1991, when there were over 33,000 contract
specialists who awarded and managed approximately $150 billion
per year in government contracts. In 2006 there were just under
28,000 contract specialists who awarded and managed over $400
billion.\5\
---------------------------------------------------------------------------
\4\ The exact number of the government's acquisition workforce is
difficult to determine with precision because it is made up of
individuals from a variety of different career series throughout the
government and because the government as a whole has not settled on a
single definition of which employees are members of the acquisition
workforce.
\5\ Federal Acquisition Institute, Annual Report on the Federal
Acquisition Workforce, Fiscal Year 2006. May 2007; Federal Procurement
Data System, Trending Analysis Report for the Last 5 Years.
---------------------------------------------------------------------------
During the 1990s, the government reduced the size of its
workforce as a whole, including acquisition personnel. In the
acquisition arena, agencies accomplished this reduction by
offering buy-outs and by decreasing efforts to recruit and
train new members of the acquisition workforce. While the
government has recently increased its recruitment of
acquisition personnel, there is today a critical lack of
acquisition employees with 5-15 years of experience. Further,
the government is facing the possibility that as much as 50
percent of its more experienced workforce--those with more than
15 years of experience--will reach retirement eligibility in
the next 4 years. Unless we act now to reinvigorate the
workforce, the government will not have enough trained and
experienced personnel to replace them.
Rapid changes in acquisition trends have also strained the
workforce. Coinciding with the decrease in acquisition
personnel has been the increase in reliance on services
provided by the private sector. Today, more than half of the
government's contract spending is for services, which cover the
gamut from professional, management, and administrative support
services, to engineering and information technology services,
to military base and logistical support, to housekeeping and
facility maintenance.\6\ Indeed, the government could not
function without the significant contribution made by the
private sector each and every day. At the same time, the
increased reliance on contractors requires that the government
retain sufficient in-house expertise to manage and oversee
contractors. The government must also have the proper policies,
processes and tools in place to ensure that contractors do not
perform inherently governmental functions, and to mitigate the
risk of organizational or personal conflicts of interests.
---------------------------------------------------------------------------
\6\ Acquisition Advisory Panel Report, p. 3.
---------------------------------------------------------------------------
The nature of how the government buys goods and services
has changed significantly since the early 1990s. At that time,
the government purchased the majority of its needs using the
lowest priced, technically acceptable offer, commonly referred
to as the ``low bid.'' In the mid-1990s the government
recognized that ``low bid'' was in many cases actually costing
it more in terms of performance and the total cost of ownership
of the goods and services it purchased. Senator John Glenn once
quipped that when he sat on top of the rocket as he was about
to be launched into space it gave him no comfort in knowing the
rocket was the product of the low bidder. The government now
makes extensive use of ``best value'' approaches for purchases,
in which differences in price, technical performance and other
capabilities are evaluated by government personnel when
determining which approach makes the most overall sense for the
government. In other trends, agencies have made greater use of
government purchase cards (i.e., commercial credit cards) for
smaller dollar purchases, and have increasingly relied on
contracts awarded by other agencies to obtain goods and
services. However, many members of the acquisition workforce
were not prepared for these changes in approaches. Lack of
training in these methods of acquisition, coupled with poor
internal controls, has contributed to instances of fraud, waste
and abuse.
The Committee believes that the government must begin
investing in the acquisition workforce in order to reinvigorate
the federal acquisition system. Toward that objective, the bill
focuses much attention on this important issue by establishing
an executive-level position to help coordinate the government's
acquisition workforce efforts; promoting a governmentwide
intern program; establishing a contingency contracting corps;
reemphasizing the need for training; and encouraging agencies
to use the resources available to them to recruit and retain a
highly skilled workforce. Other provisions of S. 680 require
the Office of Federal Procurement Policy (OFPP) to develop
uniform policies aimed at preventing and mitigating
organizational and personal conflicts of interest, as well as
ensuring that federal employees perform inherently governmental
work.

COMPETITION

Principles of federal contracting have long recognized the
benefits of robust competition--an ability to find out what is
available to meet a particular governmental need and choosing
the best solution, to motivate the private sector to develop
new or innovative goods or services, to provide incentives to
contractors to become more efficient and effective, and to
ensure that the government pays reasonable prices for the goods
and services it needs. The Competition in Contracting Act of
1984 (CICA) established that the government's policy is to
award contracts on the basis of ``full and open competition''--
that is, all responsible contractors are afforded the
opportunity to compete for government contracts.\7\ Since the
passage of CICA the processes by which the government buys
goods and services have changed for the better, but it is
obvious that the government does not always obtain effective
competition in its acquisitions. In particular, agencies
recently have made greater use of indefinite delivery (or task
order) contracts in which the agencies negotiate the basic
terms and conditions up-front and then subsequently place
orders for specific goods and services. The Federal Acquisition
Streamlining Act of 1994 (FASA) encouraged the use of these
contract types as a means of simplifying the acquisition
process, but the volume and size of task orders far exceeds
what was envisioned a decade ago.\8\ Too often, the Committee
has learned of task orders that were not fully competed between
contract holders, were awarded to a single contractor, or were
outside the scope of the underlying contract. Today, it is not
uncommon for a task order worth tens, or even hundreds, of
millions of dollars to be awarded to a single contractor. S.
680, while recognizing that task order contracts are sometimes
necessary, reemphasizes the use of competition as the mainstay
of the government's acquisition system. Additionally, the bill
improves the use of task order contracting by:
---------------------------------------------------------------------------
\7\ CICA, as enacted, is codified in 10 U.S.C. Sec. 2304(a)(1)
(applicable to DOD) and at 41 U.S.C. Sec. 253(a)(1) (applicable to
other executive agencies); CICA's competition requirements are
implemented in the Federal Acquisition Regulation (FAR), 48 C.F.R. part
6, and agency supplemental regulations.
\8\ Pub. L. No. 103-355 (Oct. 13, 1994). FASA is codified in
various sections of Title 10 of the United States Code for military
agencies and Title 41 of the Code for civilian agencies.
---------------------------------------------------------------------------
requiring agencies to better define their
requirements and evaluation procedures;
providing an opportunity for contractors to
receive a post-award debriefing;
enabling contractors to protest the award of
task orders meeting certain criteria;
requiring additional guidance when agencies
make use of tiered evaluations; and
providing agencies more flexibility when
determining when to record certain financial
obligations on task order contracts.
Further, this bill limits the length of contracts awarded
noncompetitively based on urgency to 270 days, which should be
sufficient time for agencies to meet urgent needs while
developing a more robust competition strategy.

TRANSPARENCY

Transparency in the government's actions is essential to
increasing the American people's confidence in the federal
acquisition system. While CICA established ``full and open
competition'' as the key principle underlying federal
acquisition, the law recognized that there were times when such
competition was neither practicable, feasible, nor desirable.
Consequently, CICA enabled agencies to award contracts using
``other than full and open competition,'' provided that the
agencies justify their rationale for doing so. Contracts
awarded using ``other than full and open competition'' are
commonly, though often incorrectly, referred to as either sole
source or no bid contracts, and are the subject of much
criticism today. These contracts are sometimes important tools
to respond to critical and urgent needs of the government and
the government's rationale for using other than full and open
competition should be able to withstand public scrutiny. While
the government's justification for using such contracts is
available to the public under the Freedom of Information Act (5
U.S.C. Sec. 552), the inability of the public and the Congress
to see the justifications supporting these actions in a timely
fashion contributes to a lack of trust and confidence in
government contracting. S. 680 therefore requires agencies to
publish, on their websites and at FedBizOpps, their
justification and approval documents supporting the use of
other than full and open competition.
S. 680 also directs agencies to improve the quality of data
made available to the public. Currently, it is unclear who is
responsible for ensuring that the data on government contracts
are both accurate and timely; thus information that is
available is not always reliable. S. 680 requires agencies to
ensure that the information maintained and subsequently
included in the government's Federal Procurement Data System is
both accurate and timely.

ACCOUNTABILITY

Throughout the bill, the Committee has included provisions
intended to improve accountability in the acquisition process.
Too frequently, the complexity and vastness of the federal
acquisition system diffuses responsibility for actions among
many participants, limiting the ability to hold agencies,
companies, and individuals accountable for results. For
example, by establishing and empowering a new Associate
Administrator for Workforce Programs, the Committee intends to
hold the Associate Administrator responsible for the success of
the acquisition intern program and improvement in the agencies'
workforce plans. Similarly, public reporting of justification
and approval documents and an enhanced right for contractors to
protest the issuance of task orders will serve as incentives to
sound contracting practices. By tying award fees to successful
outcomes, the Committee expects that contractors will be
rewarded for tangible achievements, not simply for efforts.
Additionally, S. 680 improves accountability for the
management of interagency contracts by requiring OMB to submit
to Congress a comprehensive report on interagency acquisitions,
and, in consultation with the heads of each agency, assess
whether the current and planned interagency contracts are cost-
effective or redundant with other contracts. Over the past ten
years, the explosive growth in interagency contracting vehicles
has come, at times, at the expense of adherence to sound
contracting policies and procedures. The Committee finds that
information on the extent and nature of interagency contracting
is incomplete and unreliable, the OMB and OFPP exert only
nominal influence over interagency contracting, and agency
heads are often unaware of the problems that affect their
contracts until it is too late.
Other provisions in S. 680 aimed at improving
accountability include requirements for the development of new
rules to provide additional oversight of purchase cards use,
limit the use of tiering of subcontractors, create a
governmentwide definition of lead system integrator, and ensure
proper use of cost-reimbursement contracts.

III. Legislative History

S. 680 was introduced by Ranking Member Collins on February
17, 2007. The bill was read twice and referred to the Committee
on Homeland Security and Governmental Affairs. S. 680 was
cosponsored by Chairman Lieberman, Senator Carper, Senator
Coleman, Senator McCaskill and Senator Akaka.
The Committee held a hearing on July 17, 2007, entitled
``Federal Acquisition: Ways to Strengthen Competition and
Accountability.'' Testimony was received from: The Honorable
David M. Walker, Comptroller General, United States Government
Accountability Office; Marcia G. Madsen, Chair, Acquisition
Advisory Panel; and Stan Z. Soloway, President, Professional
Services Council.
The Committee considered S. 680 on August 1, 2007. A
managers' amendment in the nature of a substitute was approved
by voice vote. The Committee then ordered the bill reported
favorably by voice vote.

IV. Section-by-Section Analysis

Section 1. Short title

Section 2. Table of contents

Section 3. Definitions

Section 3 provides definitions for the purposes of this
Act. ``Assisted acquisition'' is defined as a procedure by
which an agency needing supplies or services (the requesting
agency) obtains them from another agency (the servicing
agency). The definition makes clear that assisted acquisition
includes support acquired under contract actions governed by
the Economy Act (31 U.S.C. Sec. 1535), the Federal Property and
Administrative Services Act (41 U.S.C. Sec. 251 et seq.), the
Clinger-Cohen Act (division E of P.L. 104-106) (which
authorized the establishment of governmentwide acquisition
contracts (GWACs)) and the Government Management Reform Act
(P.L. 103-356) (which created certain acquisition-related
franchise funds). The Committee does not intend this definition
to include what is known as ``direct order direct bill''
arrangements where an agency is authorized to place orders
directly against another agency's contract vehicle, for example
the GSA Multiple Award Schedule Program or agency indefinite
delivery/indefinite quantity (IDIQ) contracts, where an agency
is delegated direct order authority by the agency awarding the
contract.
A ``multi-agency contract'' is defined as any contract made
available for use by more than one agency. This definition
includes all contracts, whether single award or multiple award,
and regardless of whether the contract is IDIQ or definite
delivery/definite quantity.

Title I--Acquisition Workforce

Section 101. Federal acquisition workforce

Section 101 requires a number of important changes intended
to improve the federal government's acquisition workforce. The
Committee believes that the foundation for success of the
government's acquisition system is its acquisition workforce.
Further, the Committee believes that the acquisition workforce
requires immediate and long-term attention to ensure there are
sufficient numbers of trained and experienced acquisition
workforce members to plan, award and administer acquisition
programs across all agencies. Reinvigorating the federal
acquisition workforce will be a long-term endeavor. Section 101
represents a first step toward ensuring that the government's
acquisition workforce is managed to succeed in supporting the
varied missions of federal agencies.
Throughout this section the terms ``acquisition'' and
``contracting'' are used. The use of both terms is intentional,
since contracting (i.e., the negotiation of contracts) is a
subset of acquisition (i.e., the entire process of acquiring
and managing goods and services, from planning to negotiation
to oversight). It is the Committee's intent that the focus on
the acquisition workforce include not only contracting
specialists and contracting officers but also program managers
and other members of the acquisition team. In this regard, the
Committee reiterates its belief that the acquisition workforce,
in the broadest sense, includes not only the contracting
officers who negotiate and award contracts, but also those
personnel who define the requirements, manage programs, monitor
contractor performance, and pay for the goods and services
received.
Subsection 101(a) creates a new Senior Executive Service
position in OFPP, the Associate Administrator for Workforce
Programs (to be located at the Federal Acquisition Institute)
to oversee all governmentwide acquisition workforce activities.
It is not the intent of the Committee in creating this position
to replace the responsibilities vested in each agency's Chief
Acquisition Officer (CAO) or Senior Procurement Executive.
Rather, the Committee established this position to provide a
governmentwide perspective on the acquisition workforce and to
ensure that the acquisition workforce is adequately staffed and
appropriately trained. This provision implements a
recommendation of the Acquisition Advisory Panel.
Subsection 101(b) requires the establishment of a
governmentwide Acquisition Intern Program. The newly created
Associate Administrator for Workforce Programs will manage and
oversee this program. As written, this section does not require
the creation of a new program, but rather encourages the
Associate Administrator to give strong consideration to using
and building upon existing programs. This provision sets a goal
of including a minimum of 200 interns per year in the program,
but it is the Committee's view that OFPP should seek to include
a sufficient number of interns to significantly contribute to
meeting the acquisition personnel needs of agencies, as
identified in the succession plans required under Subsection
101(h).
Subsection 101(c) creates a Contingency Contracting Corps.
Since 9/11, GAO has done numerous reviews, agency Inspectors
General have issued a number of audits, and the Committee has
heard a great deal of testimony regarding the difficulties the
government encounters when responding to emergency and
contingency situations. The Committee finds that the lack of a
sufficient number of trained contracting officers and
acquisition specialists available to support the contingency
mission contributes to these difficulties. Section 101(c)
requires the Administrator to develop a voluntary corps of
trained, equipped and deployable acquisition workforce members
ready to respond when needed, much like the military reserve.
The salary of each member of the Corps is to be paid by the
agency which employs the member, not by the agency to which the
member is deployed during a contingency operation. Expenditure
of funds to train and equip the Corps is authorized. The
Committee expects that lessons learned by DOD and the Federal
Emergency Management Agency will guide the creation and
deployment of the Corps.
Subsection 101(d) requires the head of each executive
agency, after consultation with the Associate Administrator for
Workforce Programs, to establish and operate acquisition and
contracting training programs. The Committee expects that, to
the extent practicable, training across the government will be
uniform and that agencies will leverage existing training and
education resources.
Subsection 101(e) requires the Administrator to issue
policies to promote the development of performance standards
for training and to evaluate the acquisition and training
programs required under subsection 101(d). Since poor training
and education lead to poor acquisition outcomes, the Committee
believes that the establishment and use of governmentwide
metrics for the training and education of the acquisition
workforce are critical to preventing future fraud, waste and
abuse. It would be appropriate for these metrics to be utilized
as part of the Human Capital initiative under the President's
Management Agenda Scorecard Program.
Subsection 101(f) requires each Chief Acquisition Officer
(subject to the authority, direction, and control of the head
of the agency) to carry out the powers, functions and duties of
the agency head to establish and operate the acquisition and
contracting training programs required under subsection 101(d).
The Committee recognizes that this training crosses a number of
functional areas including the Chief Human Capital Officer, the
Chief Financial Officer, the Chief Information Officer and
others. However, having the responsibility for this important
program dispersed across a number of areas makes management of
the program and consistency of the training difficult to
achieve. The Committee expects that the CAO will coordinate all
training within the agency to make sure that its acquisition
workforce satisfies established training requirements.
Subsection 101(g) requires the Administrator to collect and
maintain standardized information on acquisition and
contracting training of the acquisition workforce. The
Committee notes that the Acquisition Advisory Panel outlined in
its report the difficulty it had in determining who was in the
acquisition workforce, as well as what competencies, skills,
and training are needed by individual acquisition employees.
This does not require the Administrator to create a new system
for the collection of the required data, as the Administrator
already manages a system, the Acquisition Career Management
Information System (ACMIS). This subsection does require that
the Administrator ensure that the system allows both the
President and the Congress to know who is in the Acquisition
Workforce and what competencies and skills they have.
Subsection 101(h) requires each agency to develop an
Acquisition Workforce Succession Plan. Each Chief Acquisition
Officer, in consultation with the agency's Chief Human Capital
Officer and the Associate Administrator for Acquisition
Workforce Programs, will be responsible for developing the
agency's plan. While this subsection requires a particular
focus on program managers and warranted contracting officers,
the plans should not be limited to these specific categories,
and the Committee expects that agencies will tailor their plans
to cover the competencies and skills they need to accomplish
their specific missions. For example, it is well known that
there is a shortage of cost and pricing analysts across the
government both at the operational level and in the policy
arena. The Committee expects that the CAOs will address these
specific immediate needs and also look toward the future to
predict critical shortage areas.
Subsection 101(i) authorizes appropriations in the amount
of $5,000,000 in each of fiscal years 2008 and 2009 to pay for
some of the costs associated with implementing provisions of
this section. The Committee recognizes that $5,000,000 per year
for two years is not sufficient to pay for all of the
requirements to recruit, train, educate and retain a
governmentwide acquisition workforce and expects additional
funds to be budgeted and obtained at the agency level. The
funds authorized are available until expended.
Subsection 101(j) makes permanent the Acquisition Workforce
Training Fund. The fund was established pursuant to the
Services Acquisition Reform Act of 2003 (SARA) \9\ and helps
fund civilian agencies' acquisition workforce training programs
by requiring agencies to contribute five percent of the fees
the agencies collect for managing certain governmentwide
contracts, including GSA's Multiple Award Schedule contracts.
This fund was to expire on November 24, 2008; subsection 101(j)
eliminates this sunset. The Committee believes the fund
provides a much needed way of enabling the workforce to acquire
the necessary skills and capabilities to operate effectively in
today's changing acquisition environment.
---------------------------------------------------------------------------
\9\ Public Law 108-136, Sec. 1412, Nov. 24, 2003.
---------------------------------------------------------------------------
Subsection 101(k) requires the Administrator to ensure that
a sufficient number of acquisition workforce members are
trained in the proper application of the Brooks Architect and
Engineering Act (Brooks A&E Act). The Committee has heard
concerns from the Architect and Engineering community that A&E
services, particularly mapping and surveying services, are not
being acquired consistent with the requirements of the Brooks
Act. The Committee believes that by ensuring that a sufficient
number of acquisition workforce members are trained on the
proper application of the Brooks Act, and by the guidance
required under Section 313, the problem will be resolved.
Subsection 101(l) extends for 3 years the direct-hire
authority for members of the acquisition workforce. Under SARA,
agencies are allowed to directly recruit and appoint highly
qualified individuals to certain acquisition positions.\10\ The
authority expired on September 30, 2007. This authority, when
used in combination with other existent personnel
flexibilities, is an important tool in meeting personnel needs
identified in acquisition workforce succession plans of the
agencies.
---------------------------------------------------------------------------
\10\ Public Law 108-136, Sec. 1413(b), Nov. 24, 2003.
---------------------------------------------------------------------------
Subsection 101(m) adds a requirement that a Chief
Acquisition Officer appointed under Section 16(a) of the Office
of Federal Procurement Policy Act has an extensive management
background. The appointed individual does not have to be a
contracting expert or a certified program manager, but should
be someone who has substantial management expertise and whose
primary duties are acquisition. In those agencies where
acquisition represents a major part of the agency's mission,
appointing an individual who has experience in purchasing and
program management, in addition to management experience, would
be optimal.
Subsection 101(n) requires the Administrator, in
coordination with the Director of the Office of Personnel
Management (OPM), to utilize all existing authorities,
including the reauthorized direct-hire authority, to recruit
members of the acquisition workforce. This provision also
encourages the Administrator to consider the recruitment of
individuals retiring from private sector positions, consistent
with existing law and conflict of interest rules. The Committee
believes that there are individuals who may be willing to serve
their government, particularly in the area of acquisition, upon
retirement from the private sector and that this segment of the
population could be a valuable resource for recruiting
acquisition personnel. The Committee would like to see the
Administrator work with the OPM Director to develop best
practice guidelines, particularly addressing successful
recruitment strategies and ways to alleviate conflict of
interest concerns.

Title II--Competition and Accountability

Section 201. Requirement for purchase of property and services pursuant
to multiple award contracts

Section 201 requires the Administrator to issue regulations
to require competition on all multiple award task or delivery
order contracts. The section also requires publication on the
FedBizOpps website notice of all sole source task or delivery
orders over the simplified acquisition threshold. In practical
effect this section extends to civilian agencies the
requirement for competition established under Section 803 of
the National Defense Authorization Act for Fiscal Year 2002
that was specific to DOD's acquisition of services under
multiple award contracts.\11\ Section 201 expands the
competition requirement to include property (i.e., supplies and
equipment). Section 201 also establishes a new requirement for
posting notice of sole source task or delivery orders as
recommended by the Acquisition Advisory Panel, and requires
agencies to publish the justification and approval documents
supporting the issuance of a task or delivery order made to a
contractor that had not been awarded on a competitive basis.
The Committee has heard concerns that the requirement to post
justification and approval documents might result in the
disclosure of information otherwise protected from release
under the Freedom of Information and Privacy Acts (5 U.S.C.
Sec. Sec. 552 and 552a). This section does not relieve an
agency from its responsibilities to comply with the
requirements of the Freedom of Information and Privacy Acts,
nor was it the intent of the Committee to change the
requirements for the release of personal or proprietary data.
---------------------------------------------------------------------------
\11\ Pub. L. No. 107-107, Sec. 803, (Dec. 28, 2001).
---------------------------------------------------------------------------

Section 202. Statement of work for certain task or delivery orders

Section 202, based on recommendations of the Acquisition
Advisory Panel, creates a new requirement for both civilian and
defense agencies that a task or delivery order must include a
statement of work that clearly specifies the tasks to be
performed or the property to be delivered under the order. For
a task or delivery order in excess of the threshold for the use
of simplified procedures for commercial items, the statement of
work must be made available to all eligible contractors and
must set forth a clear statement of agency requirements,
provide a reasonable time for response, disclose significant
factors and subfactors the agency plans to use in evaluating
offers, and, if the order is to be awarded on a best value
basis, include a statement documenting the basis for selection.
A post-award debriefing shall be available to all unsuccessful
offerors. The Committee expects these post-award debriefings to
be substantive, as the Committee has learned that substantive
post-award debriefings benefit both the government and private
sector by improving the understanding of why the government
made the decisions it made and how the private sector may
improve future offers. The Committee recognizes that this new
requirement adds work to an already stressed acquisition
workforce. However, given the number of actions and dollars
being awarded through the use of task and delivery orders and
the length of performance under those task and delivery orders,
these changes are necessary to provide needed transparency to
the use of task and delivery orders.

Section 203. Protests of task and delivery orders

Section 203 creates a new right for an interested party to
protest the award of a task or delivery order exceeding a
certain threshold. The Committee sets an initial threshold of
$5,000,000, but provides that the Administrator, upon finding
that the threshold is unduly burdensome, may increase the
threshold to an amount no higher than $25,000,000. The
Committee is aware of concerns that more orders will be
protested, at a cost to both the government and the private
sector. Nonetheless, the Committee finds, as did the
Acquisition Advisory Panel, that the use of task and delivery
order contracts has expanded significantly beyond that which
was anticipated when Congress originally authorized their use
under FASA. In that regard, the Panel recommended that protests
be permitted on task and delivery orders exceeding $5 million.
Similarly, the Committee believes that providing contractors an
opportunity to protest awards in which agencies failed to
follow appropriate processes will result in more competitive
and accountable procurements. Further, based on feedback from
the private sector, GAO, and other experts, the Committee does
not anticipate a surge in protests as a result of the addition
of this right. The committee expects that both GAO and the
Court of Claims will ensure that an active motion practice will
be used in dealing with protests under this section and will
actively dismiss frivolous protests either on its own motion or
the motion of parties before the forum.

Section 204. Publication of justification and approval documents

Section 204 requires that justification and approval
documents for making other than full and open competitions be
published on both the agency's website and FedBizOpps.
Currently these documents are available under the Freedom of
Information Act; however, the Committee has learned that the
process for obtaining these documents can be cumbersome,
expensive and time consuming. Providing transparency into the
decisionmaking process to conduct an other than full and open
competition will provide greater insight to the public of what
the government is doing and why. This should improve the
confidence the American public has in how the government is
spending its tax dollars. As previously discussed in section
201, the Committee heard some concerns that the requirement to
post the justification and approval documents might result in
the disclosure of information otherwise protected from release
under the Freedom of Information and Privacy Acts. The language
of the section does not relieve an agency from compliance with
the requirements of the Freedom of Information and Privacy
Acts, nor is it the intent of the Committee to change the
requirements for the protection of personal or proprietary
data.

Section 205. Limitation on length of certain non-competitive contracts

Section 205 limits to 270 days the length of a contract
awarded through less than full and open competition under the
exception for urgent and compelling circumstances. The
Committee believes this timeframe should be sufficient for
agencies to obtain the goods and services needed to meet urgent
needs, while also allowing sufficient time for agencies to
conduct a robust competition. The Committee understands that
there are some requirements that cannot be planned for in
advance and that the government needs flexibility to respond in
those circumstances. At the same time, it is rare that the
urgent and compelling circumstances will continue to exist for
an extended period of time. It is the sense of the Committee
that the government should replace contracts awarded under
other than full and open competition with competitively awarded
contracts as soon as possible. Recognizing the unpredictability
of disasters, the Committee has included an exception process
as a safeguard that would allow the head of an agency, under
exceptional circumstances, to extend the contract beyond 270
days. The Committee intends that the exception clause be used
only when absolutely necessary.

Section 206. Prohibition on award of certain large task or delivery
order contracts for services

Section 206 prohibits the award of single award task or
delivery order contracts for services in excess of
$100,000,000. The section provides for an exception if certain
conditions are met, but the exception process is intended to be
used only where appropriate, not routinely. This section
applies to the underlying contract, not to individual task or
delivery orders. The Committee intends that task and delivery
order contracts for services adhere to the original statutory
intent of FASA, which requires multiple awards for advisory and
assistance services. Further, the Committee intends that
agencies, by awarding contracts to multiple contractors, will
issue subsequent task and delivery orders consistent with
applicable competition requirements, including those
established under Section 201 of this bill.

Section 207. Guidance on use of tiered evaluations of offers for
contracts and task orders under contracts

Section 207 requires the Administrator to issue guidance on
the proper use of tiered evaluations for offers under contract
solicitations and for task or delivery orders under indefinite
delivery indefinite quantity contracts. Under a tiered, or
cascading, evaluation an agency solicits and receives offers
from both small and other than small business concerns,
establishes a tiered order of precedence for evaluating offers,
and, if no award can be made at the first tier evaluated, then
moves on to the next lower tier, and so forth, until an award
can be made. The Committee is aware that such a process has
resulted in complaints from offerors of all sizes about the
cost of submitting bids under such a process. The Committee is
also aware that DOD finalized guidance for its personnel on the
use of tiered evaluations on August 2, 2007 in response to
direction provided under section 816 of the National Defense
Authorization Act for Fiscal Year 2006 (Pub. L. 109-163). The
Committee expects that in implementing this section the
Administrator will give full consideration to DOD's guidance,
making appropriate changes for implementation through the
Federal Acquisition Regulation (FAR).

Section 208. Guidance on use of cost-reimbursement contracts

Section 208 requires the Administrator to promulgate
regulations in the FAR on the proper use of cost-reimbursement
type contracts. The Committee believes that cost reimbursement
type contracts are an important tool and when used properly
result in good value for the taxpayer. On the other hand, the
Committee has heard testimony that cost-reimbursement contracts
too often suffer from the lack of clearly defined requirements
and insufficient oversight, and may be used by agencies in
situations in which a fixed-price type contract would be more
appropriate. Section 208 requires that, at a minimum, the
regulations to be promulgated will address when a cost-
reimbursement type contact is appropriate, what acquisition
plan findings would support use of a cost-reimbursement type
contract, and the acquisition workforce resources that should
be in place to ensure that a cost-reimbursement type contract
can be properly awarded and managed.

Section 209. Preventing conflicts of interest

Section 209 requires the Administrator to create new
uniform, governmentwide policies aimed at preventing and
mitigating organizational and personal conflicts of interest.
The nature of the government workplace has changed
significantly over the past decade, and now it is not uncommon
to find government employees and government contractors working
side-by-side in delivering services to the American people.
Sometimes contractors are even retained by the government to
oversee other contractors. It does not appear that the policies
addressing conflicts of interest have kept pace with these
changing dynamics. The Comptroller General testified before the
Committee in July 2007 that there is a need to reconsider the
current independence and conflict-of-interest rules relating to
contractors. Additionally, the Acquisition Advisory Panel made
several recommendations intended to address the risk of
organizational conflicts of interests. Section 209 is a first
step towards addressing these issues.

Section 210. Linking of award and incentive fees to acquisition
outcomes

Section 210 requires the Administrator to develop guidance
and implementation instructions to ensure that award and
incentive fees in government contracts are tied to actual
performance under the contract. The Committee has learned of a
number of situations where companies who performed marginally
or unsatisfactorily received full award or incentive fees. For
example, over the past three years GAO has reported that the
DOE, DOD and NASA were not making appropriate and effective use
of award fees. On December 19, 2005, GAO reported that DOD
frequently paid contractors the majority of potential award
fees for work where performance was described as ``expected,
good, or satisfactory'' and offered contractors one or more
opportunities to earn initially unearned fees.\12\ GAO
concluded that such practices undermined the effectiveness of
fees as a motivational tool, marginalized their use in holding
contractors accountable for acquisition outcomes, and served to
waste taxpayer funds. Similarly, GAO reported on January 17,
2007, that NASA personnel were not consistently following
agency guidance when using award fees.\13\ The Committee finds
that both the government and the contractor community would be
better served by having consistent requirements throughout the
government on the appropriate use of award fees, including the
linkage of award fees to program outcomes. Further, the
Committee understands that DOD has revised its policies and
guidance to reflect GAO's recommendations. The Administrator is
urged to give full consideration to DOD's policies and guidance
when developing guidance for use by all agencies. Further,
nothing in this section is intended to establish a right to
award or incentive fees by the contractor in the resulting
regulations.
---------------------------------------------------------------------------
\12\ GAO, Defense Acquisitions: DOD Has Paid Billions in Award and
Incentive Fees Regardless of Acquisition Outcomes. GAO-06-66.
Washington, D.C.: December 19, 2005.
\13\ GAO, NASA Procurement: Use of Award Fees for Achieving Program
Outcomes Should Be Improved. GAO-07-58. Washington, D.C.: January 17,
2007.
---------------------------------------------------------------------------

Title III--Accountability and Administration

Section 301. Recording of obligations on task order contracts

Section 301 changes the current fiscal practice that
requires an agency to obligate the full amount of the minimum
guarantee, or termination liability, whichever is more, for
each recipient, upon award of a task or delivery order
contract. This section allows the head of an executive agency
to defer recording the obligation until the issuance of the
first task or delivery order issued to each company under the
contract. It does require that, except in exceptional
circumstances, the minimum guarantee be obligated during the
same fiscal year of the initial award. This will assist
agencies in budgeting their contract dollars more effectively
and will help agencies avoid the situation where an agency is
compelled to issue a task or delivery order in order to
obligate the funds before they expire, even when the agency
does not yet need the goods or services.

Section 302. Definitizing letter contracts

Section 302 requires the unilateral definitization of
undefinitized contracts within 180 day after award or before 40
percent of the work has been completed (or within 180 day after
award or before 50 percent of the funds under the contract have
been obligated, in the case of military contracts), whichever
comes first. The section further provides for disputes
resulting from a unilateral definitization to be handled
through the Contract Disputes Act process.
To meet urgent needs, federal agencies can authorize
contractors to begin work and incur costs before reaching a
final agreement on contract terms and conditions, including
price. Such agreements are called letter contracts or
undefinitized contract actions. The Committee is concerned that
despite existing regulatory guidance on definitizing contracts,
there have been multiple examples where contracts were not
definitized in a timely fashion, and the government's ability
to manage the contract to a successful conclusion was hampered,
in some cases severely. For example, at the Committee's July 17
hearing, the Comptroller General testified that his office
found that DOD failed to definitize, within required
timeframes, 60 percent of the 77 contract actions GAO
reviewed.\14\ The Comptroller General noted that the use the
failure to do so can carry risk to the government and
potentially waste taxpayer dollars. For example, GAO reported
that DOD contracting officials were less likely to remove costs
questioned by auditors if the contractor had incurred these
costs before reaching agreement on the work's scope and
price.\15\ The Committee understands that undefinitized
contracts are sometimes an important tool in responding to
exigent situations and does not intend to limit the use of
undefinitized contracts under appropriate circumstances, but
believes that allowing these contracts to go on undefinitized
puts an unacceptable level of risk on the government.
---------------------------------------------------------------------------
\14\ GAO, Defense Contracting: Use of Undefinitized Contract
Actions Understated and Definitization Time Frames Often Not Met. GAO-
07-559. Washington, D.C.: June 19, 2007.
\15\ GAO, Iraq Contract Costs: DOD Consideration of Defense
Contract Audit Agency's Findings. GAO-06-1132. Washington, D.C.:
September 25, 2006.
---------------------------------------------------------------------------

Section 303. Preventing abuse of interagency contracts and assisted
acquisition services

Section 303 establishes a number of requirements aimed at
eliminating the redundancies in interagency contracts and
assisted acquisition services and ensuring that agencies make
proper use of interagency contracts. According to the Advisory
Acquisition Panel, about 40 percent of the government's
contract spending in fiscal year 2004 was done under
interagency contracts. It is not the Committee's intent to
eliminate either interagency contracting or the provision of
assisted acquisition services. However, the committee firmly
believes that the use of these contract vehicles requires
effective management to make sure the government maximizes its
benefits from using them. Unfortunately, GAO and some agency
Inspectors General have found that agencies too often sacrifice
adherence to sound contracting practices for expediency. In
that regard, GAO placed management of interagency contracting
on its high-risk list of government programs and activities in
January 2005.\16\ Further, the DOD Inspector General has
continued to identify problems in DOD's use of interagency
contracts. The Committee believes that agencies should be able
to achieve desired efficiency without abandoning good
stewardship.
---------------------------------------------------------------------------
\16\ GAO, High-Risk Series: An Update, GAO-05-207 Washington, D.C.:
January 2005.
---------------------------------------------------------------------------
Subsection 303(a) requires the Director of OMB to submit a
report to Congress on interagency acquisitions and to issue
guidelines on their proper use, including procedures to
maximize competition and minimize fraud, waste and abuse. The
Director is also required to institute training requirements
related to proper use of interagency contracts.
Subsection 303(b) requires that the FAR be revised to
require that all assisted acquisitions be supported by a
written agreement, a determination that they represent the best
procurement alternative and adequate, auditable documentation.
Subsection 303(c) requires the senior procurement executive
for each executive agency to provide annual reports to OMB on
compliance with the guidelines established under subsection
303(a).
Subsection 303(d) requires the Administrator to provide a
report to Congress on the number of interagency contracts, the
level of activity in Intergovernmental Revolving Funds, and the
number of enterprise-wide single agency contracts. This report
is to be made available to the public. The Committee intends
that the report will not include those contracts awarded by an
agency for use only within that agency. The Committee expects
that the Administrator, in preparing the report, will review
the acquisition plan for each interagency contract for such
things as: the overall quality of the plan, the business case
that supported the award of the contract, whether the impact
the contract would have on the government's buying power was
evaluated, and whether there was consideration of the costs
faced by industry in competing for multiple contracts.
Subsection 303(e) requires the Administrator of the General
Services to review existing contracts under the Multiple Award
Schedules (MAS) Program, in light of the entire inventory of
interagency contracts, to determine whether unnecessary
duplication exists. The Committee recognizes that the GSA MAS
Program is a key tool for achieving best value in acquiring
goods and services. However, the Committee has received reports
that duplicative schedules exist within the MAS program. The
review required by this subsection is to ensure that
duplications are identified and either mitigated or eliminated
in order to reduce the cost to the agencies that use the MAS
Program and ultimately to the taxpayer.
Subsection 303(f) requires the Administrator of OFPP to
take a number of actions to improve the use of interagency
contracts. Specifically, subsection 303(f) requires the
Administrator to:
issue regulations requiring that the
acquisition plan supporting the award of a multi-agency
contract include a business case analysis justifying
the award and administration of the contract;
review, in consultation with the
Administrator of General Services, all multi-agency
contracts and determine whether each contract is cost
effective and whether any duplication exists; and
review all interagency contracts that have
been awarded and any that are proposed for award, to
approve both the award and the exercise of options for
all interagency contracts.
The Committee believes that OFPP needs to take a more
proactive leadership role in ensuring the appropriate use of
interagency contracts. The Committee remains concerned that
agencies may be using interagency contracting vehicles for
convenience at the expense of sound contracting practices, and
that the fee-for-service environment in which assisted
interagency acquisitions operate may contribute to decisions
that are not in the government's best interests. The Committee
expects that OFFP will work with the agencies to ensure that
duplication is minimized or eliminated and that only those
contracts that provide the best overall value for the
government and adhere to sound contracting practices, whether
awarded and managed by GSA or another agency, are permitted to
continue in operation. The Committee does not know what the
correct number of contracts is to obtain the best value
governmentwide, but the Committee does believe that the current
proliferation of interagency contracts is suboptimal. The
Committee recognizes that the optimal number of interagency
contracts will be dependent on a number of factors, including
the level of government spending, the size and complexity of
the particular market, and purchasing and selling practices in
the various markets. For this reason, the Committee believes
that the guidance should identify the factors that should be
considered in determining whether to permit a new award or
allow an option to be exercised on an existing award, and
should require the agency to document its assessment in its
acquisition plan.
Subsection 303(g) requires the head of each executive
agency, in consultation with the Administrator, to review all
IDIQ contracts awarded by the agency to determine whether those
contracts are cost-effective and whether any are redundant. The
review required in this section is for the specific purpose of
determining whether agency resources should be expended in
awarding and managing these contracts, or if contracts
available from other agencies offering the same or similar
goods and services should be utilized to meet the agency's
requirement. The required review will fully evaluate the cost
to the agency of awarding and managing the contract (the fully
burdened cost). In calculating the fully burdened cost, the
agency must consider all of the acquisition-related costs, not
just the salaries of the contracting office staff. The
Committee also expects agencies to keep in mind that multiple
contracts drive up the cost of the private sector in competing
for those contracts, often to the detriment of smaller
businesses. The Committee does not intend to limit the
flexibility of an agency to fashion an acquisition solution
that meets its needs, but it does intend that agencies not
award new contracts or exercise the options on existing
contracts of their own unless their needs cannot be reasonably
and effectively met by the use of another agency's contract.
Subsection 303(h) requires OMB to modify the Federal
Procurement Data System-Next Generation (FPDS-NG) to collect
and publish complete and reliable order-level data on
interagency contracts. The current data resident in FPDS-NG do
not allow for an accurate assessment of the use of interagency
contract vehicles.
Subsection 303(i) makes it clear that for purposes of this
subsection a contract awarded by any agency or activity within
DOD is not to be considered an interagency contract when it is
used by another agency or activity of DOD.

Section 304. Purchase card waste elimination

Section 304 requires action by OMB, GSA and the Internal
Revenue Service to further improve the government's use of
purchase cards. The program has grown from its inception in
1994 to processing almost $18 billion last year, about half of
that amount in ``micro-purchases.'' \17\ The Committee believes
that the purchase card program is an important tool in meeting
the government's requirements in a cost effective and timely
fashion. The Committee has long believed, however, that agency
disciplines on use of purchase cards need to be strengthened to
prevent waste, fraud, and abuse. A Committee hearing on April
28, 2004 (``Government Purchase Cards: Smarter Use Can Save
Taxpayers Hundreds of Millions of Dollars'') exposed serious
deficiencies in controls on purchase cards across the
government. More recently, the Committee held a hearing on July
19, 2006 on purchase card use at the Department of Homeland
Security (``DHS Purchase Cards: Credit Without
Accountability'') and further examined purchase card use by the
Federal Emergency Management Agency at a hearing on December 6,
2006 (``Hurricane Katrina: Stopping the Flood of Fraud, Waste,
and Abuse''). The Committee believes that opportunities exist
to discipline the use of purchase cards by leveraging the
government's buying power, ensuring that payments are not made
to individuals who fail to meet their tax obligations, and
improving accountability.
---------------------------------------------------------------------------
\17\ Pursuant to Section 807 of the Ronald W. Reagan National
Defense Authorization Act for Fiscal Year 2005 (Pub. L. 108-375),
effective September 28, 2006, the Federal Acquisition Regulation
definition of the micro-purchase threshold changed. The micro-purchase
threshold for supplies, equipment and some services has increased from
$2,500 to $3,000. The threshold for contracts involving construction,
alteration or repair of public buildings or public works, including
painting and decorating, subject to the Davis-Bacon Act remained at
$2,000. The micro-purchase threshold for contracts the principal
purpose of which is to furnish services through the use of service
employees subject to the Service Contract Act of 1965 is $2,500.
---------------------------------------------------------------------------
Subsection 304(a) requires the Director of OMB and the
Administrator of General Services to issue guidance on how
executive agencies can better manage purchase card transactions
and to negotiate point of sale discounts when using the
government purchase card for micro-purchases. It also requires
agency reports on compliance with the OMB guidance and a report
by OMB to Congress on its progress on improving the purchase
card process and in obtaining and implementing point of sale
discounts.
Subsection 304(b) requires that GSA, in conjunction with
the Internal Revenue Service, develop procedures to apply the
Federal Payment Levy Program to purchase card payments. The
Committee is aware of the concerns raised by the banking
industry concerning this requirement. However, the Committee
feels strongly that purchase card payments, which total between
$6 billion and $9 billion annually, should not go to
individuals or companies that do not meet their federal tax
obligations.
Subsection 304(c) requires GSA to submit an annual report
on all first and business class travel undertaken by federal
travelers. This provision responds to findings by the Committee
and GAO that agencies have made improper use of first and
business class travel.

Section 305. Lead system integrators

Section 305 requires the Administrator to develop a
governmentwide definition of lead system integrators, conduct a
study on their use by the government, and then issue guidance
on the appropriate use of lead system integrators. The
Committee believes that the use of lead system integrators can
be an effective approach when developing and implementing
complex solutions. As the Committee has learned firsthand
during its oversight of the Coast Guard's Deepwater program,
however, using a lead systems integrator does not inevitably
result in good acquisition outcomes. Nor does it alleviate the
government's responsibility to clearly define its requirements,
maintain the in-house capacity to evaluate the contractor's
proposed solutions, and provide effective oversight. The
Committee finds that there is no clear guidance available to
agencies on how best to decide whether or not to use a lead
system integrator, or how to maximize the effectiveness of this
approach. Consequently, Section 305 addresses these current
shortfalls and provides a basis for making more effective and
appropriate use of lead system integrators in the future.

Section 306. Limitation on tiering of subcontractors

Section 306 requires the Administrator of OFPP to develop
guidance on how to properly minimize tiering of subcontractors
to ensure that every layer of subcontractor adds value or
serves a legitimate purpose in responding to a government
requirement. The Committee is very concerned about instances,
particularly in the response to Hurricane Katrina and in
support of operations in Iraq and Afghanistan, where multiple
tiers of subcontractors are paid on a contract when they
provide little or no value to the government. The Committee
does not intend to impose an absolute limit on tiering, but
does intend that non-value added tiering be eliminated. The
Committee is aware that DOD is in the process of finalizing
regulations required by Section 852 of the National Defense
Authorization Act for Fiscal Year 2007 (P.L. 109-364) to ensure
that pass-through charges on contracts, subcontracts, or task
or delivery orders are not excessive in relation to the cost of
work performed. OFPP should consider that guidance as it
develops governmentwide guidance.

Section 307. Responsibility of contractors that are serious threats to
national security

Section 307 enables a contracting officer to consider
whether a contractor may pose a national security threat when
determining whether a contractor is responsible when awarding a
federal contract, and requires the Administrator of OFPP to
issue guidance to implement this section. This Committee has
heard concerns that it is sometimes difficult for contracting
officers to determine how to factor into a responsibility
determination concerns that a company may pose a threat to
national security. The Committee firmly believes that agencies
should be able to make a determination that a company is not
responsible for purposes of award of a federal contract when
there is reasonable and compelling evidence that the company
may pose a national security risk. Finding a company ``non-
responsible'' for award of a contract is an action not to be
taken lightly by the government. By the same token, government
officials must have the means to deny a contract when there is
reason to believe that the company may pose a threat to
national security. This section requires OFPP to issue guidance
to help executive agencies determine when a company may pose a
national security threat and be denied a contract on that
basis. It is not the Committee's intent that individual
contracting officers be tasked with the additional burden of
having to determine whether a company is or is not a serious
threat to national security, and in fact the Committee believes
that such a decision should be made at the highest levels of
the agency.

Section 308. Required certification of program managers for Department
of Homeland Security Level One programs

Section 308 requires that program managers for Level One
programs in DHS (programs with an estimated value over $100
million) be properly certified. The Committee is concerned that
DHS program managers without proper certifications have been
assigned to these large programs, potentially contributing to
poor acquisition outcomes. The Committee recognizes that a
properly certified program manager does not in and of itself
guarantee satisfactory program performance. However, assigning
a properly certified program manager to a program means that
the individual is trained, educated, and has the necessary
competencies and skills to manage major programs at DHS.

Section 309. Elimination of one-year limitation on interest due on late
payments to contractors

Section 309 eliminates the limitation on payment of
interest due beyond one year under the Prompt Payment Act (31
U.S.C. 3901). Currently, agencies that fail to make timely
payment on proper invoices are required to pay interest on
those late payments, but only for the first twelve months. The
Committee believes this limitation may provide a disincentive
for agencies to make timely payments owed to the providers of
goods and services once the one-year timeframe has passed.

Section 310. Ensuring that federal employees perform inherently
governmental work

Section 310 requires the Administrator of OFPP to analyze
the services being purchased by the government, to issue
guidelines to ensure that only federal employees perform
inherently governmental services, and to report to Congress on
the actions taken to implement this section. The Committee is
concerned that, with the changing nature of the federal
workplace, guidelines to ensure that inherently governmental
work is performed by federal employees, and not contracted out,
may be outdated. The Comptroller General testified on July 17,
2007 that he believed there was a need to focus greater
attention on what types of functions and activities should be
contracted out and which ones should not be, and to identify
the factors that prompt the government to use contractors in
circumstances where the proper choice might be the use of civil
servants or military personnel. The Comptroller General's views
closely followed those of the Acquisition Advisory Panel, which
recommended that OFPP update the principles for agencies to
apply in determining which functions must be performed by
government employees and to ensure that agencies ensure that
such functions be adequately staffed with qualified federal
employees. Consequently, the Committee believes that the
actions required under Section 310 will help mitigate the risk
of contractors performing inherently governmental functions.

Section 311. Report on Acquisition Advisory Panel report implementation

Section 311 requires the Director of OMB to provide a
report to Congress on the implementation of the recommendations
of the Acquisition Advisory Panel. Section 311 should not be
construed as mandating the implementation of all of the Panel's
recommendations, but the Committee expects that OMB will
discuss the steps it is taking, or plans to take, for those
recommendations it is implementing, and will provide the
rationale for each recommendation that OMB does not intend to
implement.

Section 312. Report by the Government Accountability Office

Section 312 requires GAO to submit various reports to
Congress to assess further areas within the acquisition system
that need improvement. The Committee has been clear on the
importance it places on the government's acquisition workforce
and the importance of being able to leverage that workforce
across the government, as well as leveraging contracting
vehicles. Toward those objectives, the Committee mandates that
GAO report on: (1) the two statutory standards concerning the
qualification of acquisition workforce members and whether they
should be replaced by a single standard, (2) the institutions
providing acquisition training and education within the
government and whether there should be a single institution for
acquisition training and education, and (3) the implementation
of provisions concerning the appointment of Chief Acquisition
Officers. The reports provided by GAO will serve as a
foundation for further improvements in the government's
acquisition workforce. This section also requires GAO to review
the determinations made under subsection 303(g) of this statute
relative to IDIQ contracts and the implementation of
requirements related to such determinations. The review of the
implementation of subsection 303(g) is intended to stress the
importance the Committee places on reviewing and eliminating
redundant interagency contracts.

Section 313. Mapping and surveying services

Section 313 requires OFPP to develop guidance on
contracting for mapping and surveying services under the Brooks
A&E Act. The Committee is aware that there may be some
confusion over the rules applicable to the purchasing of
mapping and surveying services. The Committee does not believe
the law is ambiguous on the requirements, rather that the
implementing guidance may not be as clear as it could be. The
changes to that guidance required in this section and the
subsequent training of the acquisition workforce on the new
guidance should correct the issues surrounding the acquisition
of mapping and surveying services.

Section 314. Timely and accurate transmission of information included
in Federal Procurement Data System

Section 314 makes it clear that it is the responsibility of
the head of each executive agency to ensure that the
procurement data reported to Federal Procurement Data System-
Next Generation (FPDS-NG) is timely and accurate. Despite being
the government's principal source of data on contracting
actions, it is clear that the data are not currently being
reported in a timely fashion and are not always accurate. For
example, GAO expressed concerns on September 17, 2005 about
whether FPDS-NG had achieved the intended improvements in the
timeliness and accuracy of data, as well as ease of use and
access to data.\18\ Similarly, the Acquisition Advisory Panel
found, among other limitations, that the competition data on
orders were unreliable and that the system did not support
efforts to conduct spending analyses or strategic decision
making. Further, the Panel found that there was no individual
specifically assigned responsibility for assuring the accurate
and timely submission of data. It is essential to the agency's
management of its contract dollars, to the governmentwide
effort to leverage its buying power, and to the public's right
to transparency, that FPDS-NG have timely and accurate data.
Consequently, Section 314 implements one of the Panel's
recommendations.
---------------------------------------------------------------------------
\18\ GAO, Improvements Needed to the Federal Procurement Data
System-Next Generation, GAO-05-960R, Washington, D.C.: September 27,
2005.
---------------------------------------------------------------------------

V. Evaluation of Regulatory Impact

[Pursuant to the requirement of paragraph 11(b)(1) of rule
XXVI of the Standing Rules of the Senate the Committee has
considered the regulatory impact of this bill. CBO states that
there are no intergovernmental or private-sector mandates as
defined in the Unfunded Mandates Reform Act and no costs on
State, local, or tribal governments. The legislation contains
no other regulatory impact.]

VI. Estimated Cost of Legislation

October 16, 2007.
Hon. Joseph I. Lieberman, Chairman,
Committee on Homeland Security and Governmental Affairs,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 680, the
Accountability in Government Contracting Act of 2007.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Matthew
Pickford.
Sincerely,
Peter R. Orszag.
Enclosure.

S. 680--Accountability in Government Contracting Act of 2007

Summary: S. 680 would address federal acquisition
practices, amend rules regarding the use of noncompetitive
contracts, and impose additional reporting requirements on
federal agencies regarding noncompetitive and sole-source
contracts. The bill also would authorize appropriations for
contract oversight, training, planning, and administration.
Assuming appropriation of the amounts authorized or
estimated to be necessary, CBO estimates that implementing the
legislation would result in additional discretionary outlays of
$14 million in 2008 and nearly $70 million over the 2008-2012
period. Implementing the contracting reforms contained in the
bill would increase discretionary costs (for contract
administration) but also could result in lower procurement
costs to the federal government for goods and services. CBO
cannot estimate the net effect of those changes in contracting
procedures. Any costs or savings realized by federal agencies
under the bill would depend on future changes in the level of
discretionary appropriations.
In addition, CBO estimates that enacting S. 680 would
increase direct spending by $80 million over the 2008-2012
period and by $180 million over the 2008-2017 period because it
would authorize federal agencies to defer the recording of
obligations on certain types of contracts.
S. 680 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would not affect the budgets of state, local, or tribal
governments.
Estimated cost to the Federal Government: The estimated
budgetary impact of S. 680 is shown in the following table. The
cost of this legislation falls within all budget functions.

----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
--------------------------------------------
2008 2009 2010 2011 2012
----------------------------------------------------------------------------------------------------------------
CHANGES IN SPENDING SUBJECT TO APPROPRIATIONFederal Acquisition Workforce:
Estimated Authorization Level.................................. 5 5 5 5 5
Estimated Outlays.............................................. 4 5 5 5 5
Regulations and Reports:
Estimated Authorization Level.................................. 12 10 8 8 8
Estimated Outlays.............................................. 10 10 8 8 8
Total Changes:
Estimated Authorization Level.................................. 17 15 13 13 13
Estimated Outlays.............................................. 14 15 13 13 13
CHANGES IN DIRECT SPENDING \1\Delay in Recording Obligations:
Estimated Budget Authority..................................... 20 20 20 20 20
Estimated Outlays.............................................. 0 20 20 20 20
----------------------------------------------------------------------------------------------------------------
\1\ CBO estimates that enacting S. 680 would increase direct spending by $20 million a year over the 2009-2017
period.

Basis of estimate: For this estimate, CBO assumes that the
bill will be enacted near the start of fiscal year 2008, that
the amounts authorized or estimated to be necessary will be
appropriated for each fiscal year, and that spending will
follow historical patterns for similar activities.

Spending subject to appropriation

Federal Acquisition Workforce. Title I would authorize the
appropriation of $5 million for each of fiscal years 2008 and
2009 for a new Acquisition Workforce Training Fund. That amount
would be used by the General Services Administration (GSA) to
train personnel and to establish new procurement positions. CBO
estimates that similar amounts would be needed in subsequent
years to continue performing those activities. Assuming
appropriation of the amounts authorized for 2008 and 2009 and
estimated to be necessary for subsequent years for those
purposes, we estimate that implementing title I would cost $4
million in 2008 and $24 million over the 2008-2012 period.
Regulations and Reports. S. 680 would require government
agencies, including the Office of Federal Procurement Policy,
GSA, and the Government Accountability Office, to prepare
program guidance, regulations, and reports on many types of
contracts, including multiple-award contracting, cost-
reimbursement contracts, and other acquisition practices. Based
on the cost of similar activities, CBO estimates that
implementing those provisions would cost $10 million in 2008
and about $45 million over the 2008-2012 period, mostly for
additional administrative and personnel expenses.
Federal Contracting Rules. S. 680 would amend various rules
on using noncompetitive and sole-source contracts, including
restrictions on the contract period for noncompetitive
contracts and limits on the use of sole-source contracts.
Imposing restrictions on the length of noncompetitive
contracts and limiting the use of sole-source contracts could
increase the costs of administering contracts but also could
lower procurement costs by encouraging the use of other
acquisition practices. The circumstances involving the use of
such contracts by federal agencies and the potential to use
alternative types of contracts in those situations varies
greatly. CBO does not have sufficient information relating to
the use of such contracts to determine the magnitude of any
costs or savings that could result from implementing those
provisions.

Direct spending

CBO estimates that enacting S. 680 would increase direct
spending by $20 million annually because it would authorize
executive agencies to enter into contracts for certain types of
purchases before receiving appropriations for those
acquisitions.
Specifically, the bill would permit agencies to defer
recording obligations on task-order and delivery-order
contracts until purchase orders for the goods or services have
been issued. The new contracting authority authorized by S. 680
could be used with contracts that include federal guarantees
for minimum purchases.
Under existing federal contracting practices, agencies
record obligations for acquisitions when they enter into
contracts. In order to execute such contracts, an agency must
have sufficient funds available from current appropriations to
liquidate the entire amount of the obligation, including
minimum-purchase guarantees, which are contractual obligations
of the government.
In contrast, S. 680 would authorize an agency to defer
recording obligations for some of the amounts covered by a
contract until after that contract has been executed,
effectively allowing the agency to incur a contractual
obligation in one year and liquidate it with funds appropriated
in subsequent years. The ability to pay for current obligations
with future appropriations constitutes contract authority, a
form of direct spending.
Minimum-purchase guarantees are one type of contractual
obligation that could be affected by the bill. The Federal
Procurement Data System shows that the federal government
awarded contracts that involved task-order or delivery-order
provisions worth nearly $200 billion in 2005 (the most current
information available in that system). Many such contracts
include minimum-purchase provisions. Although there is no
government-wide information on the value of minimum-purchase
contracts, CBO estimates that minimum-purchase guarantees
account for 1 percent, or $200 million, of the value of all
task-order or delivery-order contracts. The authority to delay
recording contract obligations under the bill likely would be
used infrequently (because the legislation notes that its use
should be restricted to ``extraordinary circumstances'').
Consequently, CBO estimates that direct spending would increase
by $20 million a year over the 2009-2017 period under this
provision of the legislation.
Intergovernmental and private-sector impact: S. 680
contains no intergovernmental or private-sector mandates as
defined in UMRA and would not affect the budgets of state,
local, or tribal governments.
Previous CBO estimates: On March 14, 2007, CBO provided a
cost estimate for H.R. 1362, the Accountability in Contracting
Act, as ordered reported by the House Committee on Armed
Services on March 13, 2007. On March 12, 2007, CBO provided a
cost estimate for H.R. 1362 as ordered reported by the House
Committee on Oversight and Government Reform on March 8, 2007.
All three pieces of legislation address government contracting
but have different provisions, particularly relating to
contract management and deferral of obligations. The House
Oversight and Government Reform version of H.R. 1362 would
authorize additional appropriations for contract management.
The House Armed Services version of H.R. 1362 did not contain
that authorization of appropriations. Additionally, neither
House version contains provisions on deferring the recording of
obligations. Our cost estimates reflect those differences.
Estimate prepared by: Federal Spending: Matthew Pickford
and David Newman; Impact on State, Local, and Tribal
Governments: Elizabeth Cove; Impact on the Private Sector:
Paige Piper/Bach.
Estimate approved by: Theresa Gullo, Deputy Assistant
Director for Budget Analysis.

VII. Changes in Existing Law Made by the Bill, as Reported

In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the following changes in existing
law made by the bill, as reported, are shown as follows:
(existing law proposed to be omitted is enclosed in black
brackets, new matter is printed in italic, existing law in
which no change is proposed is shown in roman):

TITLE 10--ARMED FORCES

Subtitle A--General Military Law

PART IV--SERVICE, SUPPLY, AND PROCUREMENT

CHAPTER 137--PROCUREMENT GENERALLY

Sec. 2304. Contracts: competition requirements

(a) * * *

* * * * * * *

(d)(1) For the purposes of applying subsection (c)(1)--

* * * * * * *

(3)(A) The contract period of a contract described in
subparagraph (B) that is entered into by an agency pursuant to
the authority provided under subsection (c)(2)--
(i) may not exceed the time necessary--
(I) to meet the unusual and compelling
requirements of the work to be performed under
the contract; and
(II) for the agency to enter into another
contract for the required goods or services
through the use of competitive procedures; and
(ii) may not exceed 270 days unless the head of the
agency entering into such contract determines that
exceptional circumstances apply.
(B) This paragraph applies to any contract in an amount
greater than the simplified acquisition threshold (as defined
by section 4 of the Office of Federal Procurement Policy Act
(41 U.S.C. 403)).
(e) * * *
(f)(1) Except as provided in paragraph (2), the head of an
agency may not award a contract using procedures other than
competitive procedures unless--
(A) * * *
(B) the justification is approved--
(i) * * *
(ii) * * *
(iii) in the case of a contract for an amount
exceeding $75,000,000, by the senior
procurement executive of the agency designated
pursuant to section 16(c) of the Office of
Federal Procurement Policy Act (41 U.S.C.
414(c)) (without further delegation) or in the
case of the Under Secretary of Defense for
Acquisition, Technology, and Logistics, acting
in his capacity as the senior procurement
executive for the Department of Defense, the
Under Secretary's delegate designated pursuant
to paragraph (6)(B)[; and] ;
(C) any required notice has been published with
respect to such contract pursuant to section 18 of the
Office of Federal Procurement Policy Act (41 U.S.C.
416) and all bids or proposals received in response to
that notice have been considered by the head of the
agency[.]; and
(D) the justification and approval documents are made
publicly available on the Internet website of the
agency and FedBizOpps.

Sec. 2304a. Task and delivery order contracts: general authority

(a) * * *

* * * * * * *

(d) Single and Multiple Contract Awards.--
(1) The head of an agency may exercise the authority
provided in this section--

* * * * * * *

(4)(A) No task or delivery order contract for
services in an amount estimated to exceed $100,000,000
(including all options) may be awarded to a single
contractor unless the head of the agency determines in
writing that--
(i) because of the size, scope, or method of
performance of the requirement, it would not be
practical to award multiple task or delivery
order contracts;
(ii) the task orders expected under the
contract are so integrally related that only a
single contractor can reasonably perform the
work; or
(iii) for any other reason, it is necessary
in the public interest to award the contract to
a single contractor.
(B) The head of the agency shall notify Congress
within 30 days of any determination under subparagraph
(A)(iii).
(C) The head of the agency shall post the
justification and approval documents related to a
determination under subparagraph (A) on the Internet
website of the agency and on the Federal Business
Opportunities (FedBizOpps) Internet website.
(e) * * *
(f) * * *
(g) Authority To Defer Recording Obligations on Task or
Delivery Order Contracts.--
(1) Subject to paragraphs (2) and (3), the head of an
agency may defer the recording of an obligation,
including an obligation in the amount of the guaranteed
minimum, under a contract awarded under this section
until the issuance of a task or delivery order.
(2) The amount of the guaranteed minimum under a
contract must be obligated during the same fiscal year
during which the contract is awarded unless waived by
the head of the agency for exceptional circumstances.
(3) The amount of the guaranteed minimum under a
contract may be satisfied by multiple task or delivery
orders, but the full value of each individual task or
delivery order must be obligated when such order is
issued.
[(g)] (h) Inapplicability to Contracts for Advisory and
Assistance Services.--Except as otherwise specifically provided
in section 2304b of this title, this section does not apply to
a task or delivery order contract for the procurement of
advisory and assistance services (as defined in section 1105(g)
of title 31).
[(h)] (i) Relationship to Other Contracting Authority.--
Nothing in this section may be construed to limit or expand any
authority of the head of an agency or the Administrator of
General Services to enter into schedule, multiple award, or
task or delivery order contracts under any other provision of
law.

Sec. 2304b. Task order contracts: advisory and assistance services

(a) * * *

* * * * * * *

(f) Authority To Defer Recording Obligations on Task or
Delivery Order Contracts.--
(1) Subject to paragraphs (2) and (3), the head of an
agency may defer the recording of an obligation,
including an obligation in the amount of the guaranteed
minimum, under a contract awarded under this section
until the issuance of a task or delivery order.
(2) The amount of the guaranteed minimum under a
contract must be obligated during the same fiscal year
during which the contract is awarded unless waived by
the head of the agency for exceptional circumstances.
(3) The amount of the guaranteed minimum under a
contract may be satisfied by multiple task or delivery
orders, but the full value of each individual task or
delivery order must be obligated when such order is
issued.
[(f)] (g) Contract Modifications.--
(1) A task order may not increase the scope, period,
or maximum value of the task order contract under which
the order is issued. The scope, period, or maximum
value of the contract may be increased only by
modification of the contract.
(2) Unless use of procedures other than competitive
procedures is authorized by an exception in subsection
(c) of section 2304 of this title and approved in
accordance with subsection (f) of such section,
competitive procedures shall be used for making such a
modification.
(3) Notice regarding the modification shall be
provided in accordance with section 18 of the Office of
Federal Procurement Policy Act (41 U.S.C. 416) and
section 8(e) of the Small Business Act (15 U.S.C.
637(e)).
[(g)] (h) Contract Extensions.--
(1) Notwithstanding the limitation on the contract
period set forth in subsection (b) or in a solicitation
or contract pursuant to subsection (e), a task order
contract entered into by the head of an agency under
this section may be extended on a sole-source basis for
a period not exceeding six months if the head of such
agency determines that--
(A) the award of a follow-on contract has
been delayed by circumstances that were not
reasonably foreseeable at the time the initial
contract was entered into; and
(B) the extension is necessary in order to
ensure continuity of the receipt of services
pending the award of, and commencement of
performance under, the follow-on contract.
(2) A task order contract may be extended under the
authority of paragraph (1) only once and only in
accordance with the limitations and requirements of
this subsection.
[(h)] (i) Inapplicability to Certain Contracts.--This
section does not apply to a contract for the acquisition of
property or services that includes acquisition of advisory and
assistance services if the head of an agency entering into such
contract determines that, under the contract, advisory and
assistance services are necessarily incident to, and not a
significant component of, the contract.
[(i)] (j) Advisory and Assistance Services Defined.--In
this section, the term ``advisory and assistance services'' has
the meaning given such term in section 1105(g) of title 31.

Sec. 2304c. Task and delivery order contracts: orders

(a) * * *
(b) * * *
(c) [Statement of Work.] Statement of Work and Selection
Basis._
[A task or delivery order shall include a statement of work
that clearly specifies all tasks to be performed or property to
be delivered under the order.]
(1) In general.--A task or delivery order shall
include a statement of work that clearly specifies all
tasks to be performed or property to be delivered under
the order.
(2) Task or delivery orders in excess of the
threshold for use of simplified Procedures For
Commercial Items.--The statement of work for a task or
delivery order in excess of the threshold for use of
simplified procedures for commercial items under a task
or delivery order contract shall be made available to
each contractor awarded such contract and shall--
(A) include a clear statement of the agency's
requirements;
(B) permit a reasonable response period;
(C) disclose the significant factors and sub-
factors that the agency expects to consider in
evaluating proposals, including cost, price,
past performance, and the relative importance
of those and other factors;
(D) in the case of an award that is to be
made on a best value basis, include a written
statement documenting the basis for the award
and the relative importance of quality, past
performance, and price or cost factors; and
(E) provide an opportunity for a post-award
debriefing consistent with the requirements of
section 2305(b)(5) of this title.
(d) Protests._A protest is not authorized in connection
with the issuance or proposed issuance of a task or delivery
order [except for a protest on the ground that the order
increases the scope, period, or maximum value of the contract
under which the order is issued.] except for--
(1) a protest on the ground that the order increases
the scope, period, or maximum value of the contract
under which the order is issued; or
(2) a protest by an interested party of an order
valued at greater than the threshold established
pursuant to section 203(c) of the Accountability in
Government Contracting Act of 2007.

* * * * * * *

Sec. 2334. Definitizing of letter contracts

The head of an agency shall unilaterally determine all
missing terms in an undefinitized letter contract that have not
been agreed upon within 180 days after such letter contract has
been entered into or before the funds obligated under such
letter contract exceed 50 percent of the not-to-exceed cost of
the contract. Any terms so determined shall be subject to the
contract disputes process.

TITLE 31--MONEY AND FINANCE

Subtitle III--Financial Management

CHAPTER 39--PROMPT PAYMENT

Sec. 3901. Definitions and application

(a) * * *

* * * * * * *

(d)(1) * * *
(2) * * *
(3)(A) Except as provided in subparagraph (B), an interest
penalty under this chapter does not continue to accrue [for
more than one year or] after a claim for an interest penalty is
filed in the manner described in paragraph (2)[, whichever is
earlier].
----------

FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949 (41 U.S.C.
251, et seq.)

* * * * * * *

SEC. 303. COMPETITION REQUIREMENTS (41 U.S.C. 253).

(a) * * *

* * * * * * *

(d) Property or services deemed available from only one
source; nondelegable authority.--
(1) * * *
(2) * * *
(3)(A) The contract period of a contract described in
subparagraph (B) that is entered into by an executive
agency pursuant to the authority provided under
subsection (c)(2)--
(i) may not exceed the time necessary--
(I) to meet the unusual and
compelling requirements of the work to
be performed under the contract; and
(II) for the executive agency to
enter into another contract for the
required goods or services through the
use of competitive procedures; and
(ii) may not exceed 270 days unless the head
of the executive agency entering into such
contract determines that exceptional
circumstances apply.
(B) This paragraph applies to any contract in an
amount greater than the simplified acquisition
threshold (as defined by section 4 of the Office of
Federal Procurement Policy Act (41 U.S.C. 403)).
(e) * * *
(f) Justification for Use of Noncompetitive Procedures.--
(1) * * *
(A) * * *
(B) the justification is approved--
(i) * * *
(ii) * * *
(iii) in the case of a contract for
an amount exceeding $50,000,000, by the
senior procurement executive of the
agency designated pursuant to section
414(3) of this title (without further
delegation)[; and];
(C) any required notice has been published
with respect to such contract pursuant to
section 416 of this title and all bids or
proposals received in response to such notice
have been considered by such executive
agency[.]; and
(D) the justification and approval documents
are made publicly available on the Internet
website of the agency and FedBizOpps.

* * * * * * *

SEC. 303H. TASK AND DELIVERY ORDER CONTRACTS: GENERAL AUTHORITY (41
U.S.C. 253H).

(a) * * *

* * * * * * *

(d) Single and Multiple Contract Awards.--
(1) * * *

* * * * * * *

(4)(A) No task or delivery order contract for
services in an amount estimated to exceed $100,000,000
(including all options) may be awarded to a single
contractor unless the head of the executive agency
determines in writing that--
(i) because of the size, scope, or method of
performance of the requirement, it would not be
practical to award multiple task or delivery
order contracts;
(ii) the task orders expected under the
contract are so integrally related that only a
single contractor can reasonably perform the
work; or
(iii) for any other reason, it is necessary
in the public interest to award the contract to
a single contractor.
(B) The head of the executive agency shall notify
Congress within 30 days of any determination under
subparagraph (A)(iii).
(C) The head of the executive agency shall post the
justification and approval documents related to a
determination under subparagraph (A) on the Internet
website of the agency and on the Federal Business
Opportunities (FedBizOpps) Internet website.
(e) * * *
(f) Authority To Defer Recording Obligations on Task or
Delivery Order Contracts.--
(1) Subject to paragraphs (2) and (3), the head of an
executive agency may defer the recording of an
obligation, including an obligation in the amount of
the guaranteed minimum, under a contract awarded under
this section until the issuance of a task or delivery
order.
(2) The amount of the guaranteed minimum under a
contract must be obligated during the same fiscal year
during which the contract is awarded unless waived by
the head of the executive agency for exceptional
circumstances.
(3) The amount of the guaranteed minimum under a
contract may be satisfied by multiple task or delivery
orders, but the full value of each individual task or
delivery order must be obligated when such order is
issued.
[(f)] (g) Inapplicability to Contracts for Advisory and
Assistance Services.--Except as otherwise specifically provided
in section 253i of this title, this section does not apply to a
task or delivery order contract for the acquisition of advisory
and assistance services (as defined in section 1105(g) of Title
31).
[(g)] (h) Relationship to Other Contracting Authority.--
Nothing in this section may be construed to limit or expand any
authority of the head of an executive agency or the
Administrator of General Services to enter into schedule,
multiple award, or task or delivery order contracts under any
other provision of law.

SEC. 303I. TASK ORDER CONTRACTS: ADVISORY AND ASSISTANCE SERVICES (41
U.S.C. 253I).

(a) * * *

* * * * * * *

(h) Authority To Defer Recording Obligations on Task or
Delivery Order Contracts.--
(1) Subject to paragraphs (2) and (3), the head of an
executive agency may defer the recording of an
obligation, including an obligation in the amount of
the guaranteed minimum, under a contract awarded under
this section until the issuance of a task or delivery
order.
(2) The amount of the guaranteed minimum under a
contract must be obligated during the same fiscal year
during which the contract is awarded unless waived by
the head of the executive agency for exceptional
circumstances.
(3) The amount of the guaranteed minimum under a
contract may be satisfied by multiple task or delivery
orders, but the full value of each individual task or
delivery order must be obligated when such order is
issued.
[(h)] (i) Inapplicability to Certain Contracts.-- This
section does not apply to a contract for the acquisition of
property or services that includes acquisition of advisory and
assistance services if the head of the executive agency
entering into such contract determines that, under the
contract, advisory and assistance services are necessarily
incident to, and not a significant component of, the contract.
[(i)] (j) ``Advisory and Assistance Services'' Defined.--In
this section, the term ``advisory and assistance services'' has
the meaning given such term in section 1105(g) of Title 31.

SEC. 303J. TASK AND DELIVERY ORDER CONTRACTS: ORDERS (41 U.S.C. 253J).

(a) * * *

* * * * * * *

(c) [Statement of Work] Statement of Work and Selection
Basis.--[A task or delivery order shall include a statement of
work that clearly specifies all tasks to be performed or
property to be delivered under the order.]
(1) In general.--A task or delivery order shall
include a statement of work that clearly specifies all
tasks to be performed or property to be delivered under
the order.
(2) Task or delivery orders in excess of the
threshold for use of simplified procedures for
commercial items.--The statement of work for a task or
delivery order in excess of the threshold for use of
simplified procedures for commercial items under a task
or delivery order contract shall be made available to
each contractor awarded such contract and shall--
(A) include a clear statement of the
executive agency's requirements;
(B) permit a reasonable response period;
(C) disclose the significant factors and sub-
factors that the executive agency expects to
consider in evaluating proposals, including
cost, price, past performance, and the relative
importance of those and other factors;
(D) in the case of an award that is to be
made on a best value basis, include a written
statement documenting the basis for the award
and the relative importance of quality, past
performance, and price or cost factors; and
(E) provide an opportunity for a post-award
debriefing consistent with the requirements of
section 303B(e).
(d) Protests.--A protest is not authorized in connection
with the issuance or proposed issuance of a task or delivery
order [except for a protest on the ground that the order
increases the scope, period, or maximum value of the contract
under which the order is issued.] except for--
(1) a protest on the ground that the order increases
the scope, period, or maximum value of the contract
under which the order is issued; or
(2) a protest by an interested party of an order
valued at greater than the threshold established
pursuant to section 203(c) of the Accountability in
Government Contracting Act of 2007.

* * * * * * *

SEC. 318. DEFINITIZING OF LETTER CONTRACTS.

The head of an executive agency shall unilaterally
determine all missing terms in an undefinitized letter contract
that have not been agreed upon within 180 days after such
letter contract has been entered into or before 40 percent of
the work under such letter contract has been completed. Any
terms so determined shall be subject to the contract disputes
process.
----------

THE OFFICE OF FEDERAL PROCUREMENT POLICY ACT (41 U.S.C. 401, et seq.)

* * * * * * *

SEC. 6. AUTHORITY AND FUNCTIONS OF THE ADMINISTRATOR (41 U.S.C. 405).

(a) * * *

* * * * * * *

(l) The Administrator shall designate a member of the
Senior Executive Service as the Associate Administrator for
Workforce Programs. The Associate Administrator for Workforce
Programs shall be located in the Federal Acquisition Institute,
or its successor. The Associate Administrator shall be
responsible for--
(1) supervising the acquisition workforce training
fund established under section 37(h)(3);
(2) administering the government-wide acquisition
intern program established under section 43;
(3) developing, in coordination with Chief
Acquisition Officers and Chief Human Capital Officers,
a human capital strategic plan for the acquisition
workforce of the Federal Government;
(4) reviewing and providing input to individual
agency acquisition workforce succession plans;
(5) recommending to the Administrator and other
senior government officials appropriate programs,
policies, and practices to increase the quantity and
quality of the Federal acquisition workforce; and
(6) carrying out such other functions as the
Administrator may assign.

SEC. 16. CHIEF ACQUISITION OFFICERS AND SENIOR PROCUREMENT EXECUTIVES
(41 U.S.C. 414).

(a) Establishment of Agency Chief Acquisition Officers.--
(1) * * *
(2) Chief Acquisition Officers shall be appointed
from among persons who have an extensive management
background.

* * * * * * *

SEC. 19. RECORD REQUIREMENTS.

(a) * * *

* * * * * * *

(d) Transmission and Data [System] Entry of Information.--
[The information included in the record established and
maintained under subsection (a) of this section shall be
transmitted to the General Services Administration and shall be
entered in the Federal Procurement Data System referred to in
section 405(d)(4) of this title.] The head of each executive
agency shall ensure the accuracy of the information included in
the record established and maintained by such agency under
subsection (a) and shall timely transmit such information to
the General Services Administration for entry into the Federal
Procurement Data System referred to in section 6(d)(4), or any
successor system.

* * * * * * *

SEC. 37. ACQUISITION WORKFORCE.

(a) * * *

* * * * * * *

(h) Education and Training.--
(1) * * *
(2) * * *
(3) Acquisition workforce training fund.--
(A) * * *

* * * * * * *

(G) Amounts credited to the fund shall remain
available to be expended only in the fiscal
year for which credited and the two succeeding
fiscal years.
[(H) This paragraph shall cease to be
effective five years after November 24, 2003.]

* * * * * * *

SEC. 43. GOVERNMENT-WIDE ACQUISITION INTERN PROGRAM.

(a) Establishment of Program.--The Administrator shall
establish a government-wide Acquisition Intern Program to
strengthen the Federal acquisition workforce to carry out its
key missions through the Federal procurement process. The
Administrator shall have a goal of involving not less than 200
college graduates per year in the Acquisition Intern Program.
(b) Administration of Programs.--The Associate
Administrator for Acquisition Workforce Programs designated
under section 6(l) shall be responsible for the management,
oversight, and administration of the Acquisition Intern Program
and shall give strong consideration to utilizing existing
similar programs and seek to build upon those programs instead
of replacing them or creating new programs.
(c) Terms of Acquisition Intern Program.--
(1) Business-related course work requirement.--
(A) In general.--Each participant in the
Acquisition Intern Program shall have completed
24 credit hours of business-related college
course work by not later than 3 years after
admission into the program.
(B) Certification criteria.--The
Administrator shall establish criteria for
certifying the completion of the course work
requirement under subparagraph (A).
(2) Structure of program.--The Acquisition Intern
Program shall consist of one year of preparatory
education and training in Federal procurement followed
by 3 years of on-the-job training and development
focused on Federal procurement but including rotational
assignments in other functional areas.
(3) Employment status of interns.--Interns
participating in the Acquisition Intern Program shall
be considered probationary employees without civil
service protections under chapter 33 of title 5, United
States Code. In administering any personnel ceiling
applicable to an executive agency or a unit of an
executive agency, an individual assigned as an intern
under the program shall not be counted.
(4) Agency management of program.--The Chief
Acquisition Officer of each executive agency, in
consultation with the Chief Human Capital Officer of
such agency, shall establish a central intern
management function in the agency to supervise and
manage interns participating in the Acquisition Intern
Program.

SEC. 44. CONTINGENCY CONTRACTING CORPS.

(a) Establishment.--The Administrator shall establish a
government-wide Contingency Contracting Corps (in this section,
referred to as the `Corps'). The members of the Corps shall be
available for deployment in responding to disasters, natural
and man-made, and contingency operations both within and
outside the continental United States.
(b) Membership.--Membership in the Corps shall be voluntary
and open to all Federal employees, including uniformed members
of the Armed Services, who are currently members of the Federal
acquisition workforce.
(c) Education and Training.--The Administrator may
establish additional educational and training requirements, and
may pay for these additional requirements from funds available
in the acquisition workforce training fund.
(d) Clothing and Equipment.--The Administrator shall
identify any necessary clothing and equipment requirements, and
may pay for this clothing and equipment from funds available in
the acquisition workforce training fund.
(e) Salary.--The salaries for members of the Corps shall be
paid by their parent agencies out of existing appropriations.
(f) Authority To Deploy the Corps.--The Administrator, or
the Administrator's designee, shall have the authority to
determine when members of the Corps shall be deployed, in
consultation with the head of the agency or agencies employing
the members to be deployed.
(g) Annual Report.--
(1) In general.--The Administrator shall provide to
the Committee on Homeland Security and Governmental
Affairs and the Committee on Armed Services of the
Senate and the Committee on Oversight and Government
Reform and the Committee on Armed Services of the House
of Representatives an annual report on the status of
the Contingency Contracting Corps.
(2) Content.--At a minimum, each report under
paragraph (1) shall include the number of members of
the Contingency Contracting Corps, the fully burdened
cost of operating the program, the number of
deployments of members of the program, and the
performance of members of the program in deployment.
----------

THE SERVICES ACQUISITION REFORM ACT OF 2003 (Title XIV of Public Law
108-136)

SEC. 1413. ACQUISITION WORKFORCE RECRUITMENT PROGRAM.

(a) Determination of Shortage Category Positions.--For
purposes of sections 3304, 5333, and 5753 of title 5, United
States Code, the head of a department or agency of the United
States (other than the Secretary of Defense) may determine,
under regulations prescribed by the Office of Personnel
Management, that certain Federal acquisition positions (as
described in section 37(g)(1)(A) of the Office of Federal
Procurement Policy Act (41 U.S.C. 433(g)(1)(A)) are shortage
category positions in order to use the authorities in those
sections to recruit and appoint highly qualified persons
directly to such positions in the department or agency.
(b) Termination of Authority.--The head of a department or
agency may not appoint a person to a position of employment
under this section after [September 30, 2007] September 30,
2010.