[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.
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    \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.
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                       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\
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    \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.
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    \9\ Public Law 108-136, Sec. 1412, Nov. 24, 2003.
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    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.
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    \10\ Public Law 108-136, Sec. 1413(b), Nov. 24, 2003.
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    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.

                                  
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