[Senate Report 117-192]
[From the U.S. Government Publishing Office]


                                                  Calendar No. 543

117th Congress}                                           { Report
                                 SENATE
  2d Session  }                                           { 117-192

======================================================================
 
                   HOMELAND PROCUREMENT REFORM ACT

                               __________

                              R E P O R T

                                 OF THE

                   COMMITTEE ON HOMELAND SECURITY AND

                          GOVERNMENTAL AFFAIRS

                          UNITED STATES SENATE

                              TO ACCOMPANY

                                S. 1009

               TO AMEND THE HOMELAND SECURITY ACT OF 2002
               REGARDING THE PROCUREMENT OF CERTAIN ITEMS
               RELATED TO NATIONAL SECURITY INTERESTS FOR
               DEPARTMENT OF HOMELAND SECURITY FRONTLINE
             OPERATIONAL COMPONENTS, AND FOR OTHER PURPOSES

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


               November 14, 2022.--Ordered to be printed
               
                                __________

                    U.S. GOVERNMENT PUBLISHING OFFICE                    
39-010                    WASHINGTON : 2022                     
          
-----------------------------------------------------------------------------------   
               
        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                   GARY C. PETERS, Michigan, Chairman
THOMAS R. CARPER, Delaware           ROB PORTMAN, Ohio
MAGGIE HASSAN, New Hampshire         RON JOHNSON, Wisconsin
KYRSTEN SINEMA, Arizona              RAND PAUL, Kentucky
JACKY ROSEN, Nevada                  JAMES LANKFORD, Oklahoma
ALEX PADILLA, California             MITT ROMNEY, Utah
JON OSSOFF, Georgia                  RICK SCOTT, Florida
                                     JOSH HAWLEY, Missouri

                   David M. Weinberg, Staff Director
                    Zachary I. Schram, Chief Counsel
                  Michelle M. Benecke, Senior Counsel
   Tiffany Ann Shujath, U.S. Department of Homeland Security Detailee
                Pamela Thiessen, Minority Staff Director
            Sam J. Mulopulos, Minority Deputy Staff Director
       Jeremy H. Hayes, Minority Senior Professional Staff Member
                     Laura W. Kilbride, Chief Clerk
                     
                     

                                                  Calendar No. 543

117th Congress}                                           { Report
                                 SENATE
  2d Session  }                                           { 117-192

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

                    HOMELAND PROCUREMENT REFORM ACT

                                _______
                                

               November 14, 2022.--Ordered to be printed

                                _______
                                

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

                              R E P O R T

                         [To accompany S. 1009]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Homeland Security and Governmental 
Affairs, to which was referred the bill (S. 1009) to amend the 
Homeland Security Act of 2002 regarding the procurement of 
certain items related to national security interests for 
Department of Homeland Security frontline operational 
components, and for other purposes, having considered the same, 
reports favorably thereon with an amendment, in the nature of a 
substitute, and recommends that the bill, as amended, do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and Summary..............................................1
 II. Background and Need for the Legislation..........................2
III. Legislative History..............................................2
 IV. Section-by-Section Analysis of the Bill, as Reported.............3
  V. Evaluation of Regulatory Impact..................................4
 VI. Congressional Budget Office Cost Estimate........................4
VII. Changes in Existing Law Made by the Bill, as Reported............6

                         I. Purpose and Summary

    The purpose of S. 1009, the Homeland Procurement Reform 
(HOPR) Act is to ensure that certain materials procured by the 
Department of Homeland Security (DHS) are made in America and 
meet established quality standards. Additionally, to the 
maximum extent possible, one third of the funds obligated for 
DHS procurement of items covered in the bill must be reserved 
for manufacturers that qualify as small businesses. Covered 
items include uniforms, holsters, patches and insignia, 
footwear, body armor, and biological, radiological, and nuclear 
protective gear.
    The Secretary of DHS may waive bill requirements in the 
event of a national emergency or major disaster if the 
Secretary determines there is an insufficient supply of covered 
items that meet the requirement; notice must be provided to 
Congress in such an event. The bill also requires the Secretary 
to provide a report to House and Senate Committees on instances 
in which vendors have failed to meet deadlines for delivery of 
covered items and corrective actions taken by the Department in 
response to such instances. The Secretary is directed to 
conduct a study on the adequacy of uniform allowances provided 
to employees of frontline operational components.

              II. Background and Need for the Legislation

    Currently, many uniforms and uniform components for 
frontline officers of U.S. Customs and Border Protection, the 
personnel who facilitate trade and travel and safeguard United 
States' borders, are made in foreign countries, including El 
Salvador, Mexico, Honduras and Cambodia.\1\ This presents a 
homeland security risk by exposing uniforms and uniform 
components to potential theft and use for nefarious purposes 
and a supply chain risk in the event that circumstances in 
these various countries disrupt the production of materials.
---------------------------------------------------------------------------
    \1\Government Accountability Office, Government Procurement: Effect 
of Restriction on DHS's Purchasing of Foreign Textiles is Limited (Nov. 
21, 2017).
---------------------------------------------------------------------------
    In 2009, Congress enacted the Kissell Amendment as part of 
the American Recovery and Reinvestment Act to institute a 
preference at DHS for buying American-sourced textiles, 
clothing, and footwear.\2\ However, in practice, the Kissell 
Amendment only applies to the Transportation Security 
Administration (TSA), while other agencies such as Customs and 
Border Protection, Immigration and Customs Enforcement, and the 
Secret Service are not covered.\3\
---------------------------------------------------------------------------
    \2\American Recovery and Reinvestment Act of 2009, Pub. L. No. 111-
5, Sec. 602.
    \3\Congressional Research Service, Buying American: The Berry and 
Kissell Amendments (Jan. 13, 2021).
---------------------------------------------------------------------------
    The Government Accountability Office (GAO) has found that 
the Kissell Amendment has only a limited effect on DHS textile 
purchases from foreign sources due to U.S. obligations under 
international agreements.\4\ GAO has also noted that DHS 
officials and representatives stated that it would be possible 
to source most of the items in the current uniforms contract 
from the United States.\5\
---------------------------------------------------------------------------
    \4\Government Accountability Office, Government Procurement: Effect 
of Restriction on DHS's Purchasing of Foreign Textiles is Limited (Nov. 
21, 2017).
    \5\Id.
---------------------------------------------------------------------------
    The HOPR Act addresses these concerns by requiring DHS to 
procure covered items from domestic sources to the greatest 
extent possible.

                        III. Legislative History

    Senator Jeanne Shaheen (D-NH) introduced S. 1009 on March 
25, 2021, with Senator Jerry Moran (R-KS), Senator Margaret 
Wood Hassan (D-NH), and Senator Mike Rounds (R-SD). Senator 
Gary Peters (D-MI) joined as a cosponsor on July 13, 2021. The 
bill was referred to the Committee on Homeland Security and 
Governmental Affairs.
    The Committee considered S. 1009 at a business meeting on 
July 14, 2021. During the meeting, a substitute amendment 
clarifying procured items covered by the bill and adding a 
reporting requirement was offered by Chairman Peters and 
adopted by unanimous consent.
    An amendment to rescind President Biden's proclamation that 
terminated President Trump's emergency with respect to the 
southern border was offered by Senator Lankford (R-OK), and was 
not adopted by roll call vote of 6 yeas to 8 nays. Senators 
Portman, Johnson, Lankford, Romney, Scott, and Hawley voted in 
the affirmative. Senators Peters, Carper, Hassan, Rosen, 
Padilla, Ossoff, Sinema (by proxy), and Paul (by proxy) voted 
in the negative.
    The Committee ordered the bill to be reported favorably by 
voice vote as amended by the Peters Substitute Amendment. 
Senators present for the vote on the bill were: Peters, Carper, 
Hassan, Rosen, Padilla, Ossoff, Portman, Johnson, Lankford, 
Romney, Scott, and Hawley.

        IV. Section-by-Section Analysis of the Bill, as Reported


Section 1. Short title

    This section provides that the bill may be cited as the 
``Homeland Procurement Reform Act'' or the ``HOPR Act.''

Sec. 2. Requirements to Buy Certain Items Related to National Security 
        Interests according to certain criteria

    Subsection (a) adds a new section 836 titled ``Requirements 
to Buy Certain Items Related to National Security Interests'' 
to the end of Subtitle D of title VIII of the Homeland Security 
Act of 2002.
    Section 836, subsection (a) defines the terms ``covered 
item'' and ``frontline operational component.''
    Section 836, subsection (b) requires the defined components 
of the Department of Homeland Security to use at least one-
third of all funds allocated to purchasing the items specified 
as covered in the amendment to purchase these items from small 
businesses that manufacture the items in the United States. The 
subsection further defines the criteria these small businesses 
must meet to qualify as an approved contractor. The subsection 
also provides direction for the safeguarding of any covered 
item with insignia, including requirements for storage and 
reporting theft of these items, and for their destruction if 
they are defective or unusable. The subsection waives these 
requirements, as well as the requirements in Subsection (C), 
for national emergencies in which there is a supply shortage of 
such items; the Secretary must provide notice to Congress if 
requirements are waived.
    Section 836, subsection (c) stipulates that the Secretary 
abide by the Federal Acquisition Regulation to ensure that the 
prices of these items are fair and reasonable.
    Section 836, subsection (d) requires the Secretary to 
report on any failures of vendors to meet deadlines for 
delivery of covered items to specified Congressional committees 
within one year of the Act's enactment.
    Section 836, subsection (e) stipulates that the contract 
requirements created by this section will apply to all 
contracts entered into by the Department or any frontline 
component beginning 180 days after the Act's enactment.
    Subsection (b) instructs the Secretary to submit a study of 
the adequacy of employee uniform allowances of the frontline 
operational components defined in this amendment. The 
subsection specifies that the study must be informed by an 
employee survey, must assess the adequacy of the most recent 
uniform allowance increase for first year employees, and must 
consider increasing the allowance for all employees by 50 
percent. This study must be submitted within 18 months of the 
Act's enactment.
    Subsection (c) instructs the Secretary to report to 
Congress with recommendations on how the Department could 
procure additional items from domestic sources and bolster the 
domestic supply chain for items related to national security. 
The report must include a review of the Department's compliance 
with certain procurement requirements in the American Recovery 
and Reinvestment Act of 2009, as well as an assessment of the 
Department's capacity to procure personal protective equipment 
(for pandemic response), helmets and other head protection, and 
environmental and flame-resistant clothing. This report must be 
submitted within 180 days of the Act's enactment.
    Subsection (d) adds Sec. 836 to the table of contents of 
the Homeland Security Act of 2002 through a clerical amendment.

                   V. Evaluation of Regulatory Impact

    Pursuant to the requirements of paragraph 11(b) of rule 
XXVI of the Standing Rules of the Senate, the Committee has 
considered the regulatory impact of this bill and determined 
that the bill will have no regulatory impact within the meaning 
of the rules. The Committee agrees with the Congressional 
Budget Office's statement that the bill contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act (UMRA) and would impose no costs 
on state, local, or tribal governments.

             VI. Congressional Budget Office Cost Estimate

                                     U.S. Congress,
                               Congressional Budget Office,
                                  Washington, DC, October 24, 2022.
Hon. Gary C. Peters,
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. 1009, the Homeland 
Procurement Reform Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Jeremy Crimm.
            Sincerely,
                                         Phillip L. Swagel,
                                                          Director.
    Enclosure.

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    

    S. 1009 would require, to the extent possible, that no less 
than one-third of the funds the Department of Homeland Security 
(DHS) obligates annually for procuring uniforms and certain 
protective gear be spent for contracts with domestic small 
business manufacturers. That provision would apply to contracts 
signed six months after the bill's enactment for select DHS 
component units. S. 1009 also contains several reporting 
requirements, including an annual briefing to the Congress and 
studies on the adequacy of uniform allowances and ways to 
bolster domestic procurement.
    Currently, DHS sources its uniforms under a contract that 
will expire in January 2027. Based on information from DHS, the 
agency obligates funds when items are ordered and outlays them 
when they are delivered, usually within 90 days.
    The affected agencies, including Customs and Border 
Protection, the U.S. Coast Guard, the Transportation Security 
Administration, and the Federal Emergency Management Agency, 
currently spend $100 million on 1,500 items annually under the 
contract, which covers the majority of items subject to the 
bill's requirements. Using information from DHS, CBO expects 
that it would need to procure 150 of those items from new 
sources to meet the bill's requirements.
    Using information from DHS regarding its current uniform 
contract, CBO estimates that each item that is re-sourced from 
domestic small business manufacturers would cost about 100 
percent more. That includes a change fee, which is required 
under the current contract, and additional costs from the item 
being sourced from a domestic small business manufacturer. In 
conversations with CBO, DHS indicated that it could take 
several years to re-source items due to prototype development 
and testing. Based on this information, CBO anticipates that 
DHS would gradually procure items from domestic small business 
manufacturers beginning in fiscal year 2025.
    In total, CBO estimates that re-sourcing uniforms to meet 
S. 1009's requirements would increase spending by $54 million 
over the 2023-2027 period. Such spending would be subject to 
the availability of appropriated funds.
    The specified agencies currently spend $12 million annually 
on protective equipment, all of which is manufactured 
domestically. Based on this information, CBO assumes that DHS 
already complies with the protective equipment requirements in 
S. 1009 and that implementing the bill would not increase the 
cost of procuring these items.
    Based on the cost of reports similar to those required by 
the bill, CBO estimates that it would cost DHS less than 
$500,000 over the 2023-2027 period to annually brief the 
Congress and produce the required studies; such spending would 
be subject to the availability of appropriated funds.
    The costs of the legislation, detailed in Table 1, fall 
within budget functions 750 (administration of justice), 450 
(community regional development), and 400 (transportation).

                TABLE 1.--ESTIMATED INCREASES IN SPENDING SUBJECT TO APPROPRIATION UNDER S. 1009
----------------------------------------------------------------------------------------------------------------
                                                                     By fiscal year, millions of dollars--
                                                              --------------------------------------------------
                                                                2023    2024    2025    2026    2027   2023-2027
----------------------------------------------------------------------------------------------------------------
Estimated Authorization......................................       0       0      13      23      20        56
Estimated Outlays............................................       0       0      12      22      20        54
----------------------------------------------------------------------------------------------------------------

    S. 1009 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would not affect the budgets of state, local, or tribal 
governments.
    On November 12, 2021, CBO transmitted a cost estimate for 
H.R. 2915, the Homeland Procurement Reform Act, as ordered 
reported by the House Committee on Homeland Security on October 
5, 2021. The Senate bill would require that one-third of the 
funds DHS obligates annually for uniforms and protective gear 
for certain agencies to come from manufacturers that are small 
business. The House bill would require one-third of those 
obligations to come from both manufacturers and suppliers. DHS 
indicated that it is currently in compliance with the House 
bill's procurement provision because a large percentage of its 
uniforms and protective gear already come from suppliers that 
are domestic small businesses. However, the exclusion of 
suppliers in the Senate bill would require DHS to re-source 150 
items from domestic small business manufacturers at a higher 
cost. In addition, CBO's estimate for H.R. 2195 assumed a 
different enactment date than S. 1009.
    The CBO staff contact for this estimate is Jeremy Crimm. 
The estimate was reviewed by Leo Lex, Deputy Director of 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, changes in existing law made by 
the bill, as reported, are shown as follows: (existing law 
proposed to be omitted is enclosed in brackets, new matter is 
printed in italic, and existing law in which no change is 
proposed is shown in roman):

HOMELAND SECURITY ACT OF 2002

           *       *       *       *       *       *       *


SEC. 836. REQUIREMENTS TO BUY CERTAIN ITEMS RELATED TO NATIONAL 
                    SECURITY INTERESTS.

    (a) Definitions.--In this section:
          (1) Covered item.--The term `covered item' means any 
        of the following:
                  (A) Footwear provided as part of a uniform.
                  (B) Uniforms.
                  (C) Holsters and tactical pouches.
                  (D) Patches, insignia, and embellishments.
                  (E) Chemical, biological, radiological, and 
                nuclear protective gear.
                  (F) Body armor components intended to provide 
                ballistic protection for an individual, 
                consisting of 1 or more of the following:
                          (i) Soft ballistic panels.
                          (ii) Hard ballistic plates.
                          (iii) Concealed armor carriers worn 
                        under a uniform.
                          (iv) External armor carriers worn 
                        over a uniform.
                  (G) Any other item as determined appropriate 
                by the Secretary.
          (2) Frontline operational component.--The term 
        `frontline operational component' means any of the 
        following organizations of the Department:
                  (A) U.S. Customs and Border Protection.
                  (B) U.S. Immigration and Customs Enforcement.
                  (C) The United States Secret Service.
                  (D) The Transportation Security 
                Administration.
                  (E) The Coast Guard.
                  (F) The Federal Protective Service.
                  (G) The Federal Emergency Management Agency.
                  (H) The Federal Law Enforcement Training 
                Centers.
                  (I) The Cybersecurity and Infrastructure 
                Security Agency.
    (b) Requirements.--
          (1) In general.--The Secretary shall ensure that any 
        procurement of a covered item for a front-line 
        operational component meets the following criteria:
                  (A) To the maximum extent possible, not less 
                than one-third of funds obligated in a specific 
                fiscal year for the procurement of such covered 
                items shall be covered items that are 
                manufactured in the United States by entities 
                that qualify as small business concerns, as 
                defined in section 3 of the Small Business Act 
                (15 U.S.C. 632).
                  (B) Each contractor with respect to the 
                procurement of such a covered item, including 
                the end-item manufacturer of such a covered 
                item--
                          (i) is an entity registered with the 
                        System for Award Management (or 
                        successor system) administered by the 
                        General Services Administration; and
                          (ii) is in compliance with ISO 
                        9001:2015 of the International 
                        Organization for Standardization (or 
                        successor standard) or a standard 
                        determined appropriate by the Secretary 
                        to ensure the quality of products and 
                        adherence to applicable statutory and 
                        regulatory requirements.
                  (C) Each supplier of such a covered item with 
                an insignia (such as any patch, badge, or 
                emblem) and each supplier of such an insignia, 
                if such covered item with such insignia or such 
                insignia, as the case may be, is not produced, 
                applied, or assembled in the United States, 
                shall--
                          (i) store such covered item with such 
                        insignia or such insignia in a locked 
                        area;
                          (ii) report any pilferage or theft of 
                        such covered item with such insignia or 
                        such insignia occurring at any stage 
                        before delivery of such covered item 
                        with such insignia or such insignia; 
                        and
                          (iii) destroy any such defective or 
                        unusable covered item with insignia or 
                        insignia in a manner established by the 
                        Secretary, and maintain records, for 
                        three years after the creation of such 
                        records, of such destruction that 
                        include the date of such destruction, a 
                        description of the covered item with 
                        insignia or insignia destroyed, the 
                        quantity of the covered item with 
                        insignia or insignia destroyed, and the 
                        method of destruction.
          (2) Waiver.--
                  (A) In general.--In the case of a national 
                emergency declared by the President under the 
                National Emergencies Act (50 U.S.C. 1601 et 
                seq.) or a major disaster declared by the 
                President under section 401 of the Robert T. 
                Stafford Disaster Relief and Emergency 
                Assistance Act (42 U.S.C. 5170), the Secretary 
                may waive a requirement in subparagraph (A), 
                (B) or (C) of paragraph (1) if the Secretary 
                determines there is an insufficient supply of a 
                covered item that meets the requirement.
                  (B) Notice.--Not later than 60 days after the 
                date on which the Secretary determines a waiver 
                under subparagraph (A) is necessary, the 
                Secretary shall provide to the Committee on 
                Homeland Security and Governmental Affairs and 
                the Committee on Appropriations of the Senate 
                and the Committee on Homeland Security, the 
                Committee on Oversight and Reform, and the 
                Committee on Appropriations of the House of 
                Representatives notice of such determination, 
                which shall include--
                          (i) identification of the national 
                        emergency or major disaster declared by 
                        the President;
                          (ii) identification of the covered 
                        item for which the Secretary intends to 
                        issue the waiver; and
                          (iii) a description of the demand for 
                        the covered item and corresponding lack 
                        of supply from contractors able to meet 
                        the criteria described in subparagraph 
                        (B) or (C) of paragraph (1).
    (c) Pricing.--The Secretary shall ensure that covered items 
are purchased at a fair and reasonable price, consistent with 
the procedures and guidelines specified in the Federal 
Acquisition Regulation.
    (d) Report.--Not later than 1 year after the date of 
enactment of this section and annually thereafter, the 
Secretary shall provide to the Committee on Homeland Security, 
the Committee on Oversight and Reform, and the Committee on 
Appropriations of the House of Representatives, and the 
Committee on Homeland Security and Governmental Affairs and the 
Committee on Appropriations of the Senate a briefing on 
instances in which vendors have failed to meet deadlines for 
delivery of covered items and corrective actions taken by the 
Department in response to such instances.
    (e) Effective Date.--This section applies with respect to a 
contract entered into by the Department or any frontline 
operational component on or after the date that is 180 days 
after the date of enactment of this section.

                                  [all]