[Senate Report 118-29]
[From the U.S. Government Publishing Office]
Calendar No. 73
118th Congress} { Report
SENATE
1st Session } { 118-29
======================================================================
BANNING OPERATIONS AND LEASES WITH
THE ILLEGITIMATE VENEZUELAN
AUTHORITARIAN REGIME ACT
__________
R E P O R T
OF THE
COMMITTEE ON HOMELAND SECURITY AND
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
TO ACCOMPANY
S. 257
TO PROHIBIT CONTRACTING WITH PERSONS THAT
HAVE BUSINESS OPERATIONS WITH THE MADURO
REGIME, AND FOR OTHER PURPOSES
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
May 16, 2023.--Ordered to be printed
__________
U.S. GOVERNMENT PUBLISHING OFFICE
WASHINGTON : 2023
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COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
GARY C. PETERS, Michigan, Chairman
THOMAS R. CARPER, Delaware RAND PAUL, Kentucky
MAGGIE HASSAN, New Hampshire RON JOHNSON, Wisconsin
KYRSTEN SINEMA, Arizona JAMES LANKFORD, Oklahoma
JACKY ROSEN, Nevada MITT ROMNEY, Utah
ALEX PADILLA, California RICK SCOTT, Florida
JON OSSOFF, Georgia JOSH HAWLEY, Missouri
RICHARD BLUMENTHAL, Connecticut ROGER MARSHALL, Kansas
David M. Weinberg, Staff Director
Zachary I. Schram, Chief Counsel
Michelle M. Benecke, Senior Counsel
William E. Henderson III, Minority Staff Director
Christina N. Salazar, Minority Chief Counsel
Andrew J. Hopkins, Minority Counsel
Laura W. Kilbride, Chief Clerk
Calendar No. 73
118th Congress} { Report
SENATE
1st Session } { 118-29
======================================================================
BANNING OPERATIONS AND LEASES WITH THE ILLEGITIMATE VENEZUELAN
AUTHORITARIAN REGIME ACT
_______
May 16, 2023.--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. 257]
[Including cost estimate of the Congressional Budget Office]
The Committee on Homeland Security and Governmental
Affairs, to which was referred the bill (S. 257) to prohibit
contracting with persons that have business operations with the
Maduro regime, and for other purposes, having considered the
same, reports favorably thereon without amendment and
recommends that the bill do pass.
CONTENTS
Page
I. Purpose and Summary..............................................1
II. Background and Need for the Legislation..........................2
III. Legislative History..............................................3
IV. Section-by-Section Analysis of the Bill, as Reported.............3
V. Evaluation of Regulatory Impact..................................4
VI. Congressional Budget Office Cost Estimate........................5
VII. Changes in Existing Law Made by the Bill, as Reported............5
I. PURPOSE AND SUMMARY
The purpose of S. 257, the Banning Operations and Leases
with the Illegitimate Venezuelan Authoritarian Regime (BOLIVAR)
Act, is to prohibit federal agencies from contracting for the
procurement of goods or services with any person that has
business operations with an authority of the government of
Venezuela that is not recognized as the legitimate government
of Venezuela by the United States Government. This prohibition
does not apply to contracts that support United States
Government activities in Venezuela, to those who have a valid
license from the Office of Foreign Assets Control, or to
contracts related to the American diplomatic mission in
Venezuela. The legislation also provides exceptions for
instances where the Secretary of State determines that the
business operations with the illegitimate Venezuelan government
are necessary for the provision of humanitarian assistance,
disaster relief, other urgent life-saving measures,
noncombatant evacuations, or is otherwise in the national
security interests of the United States.\1\
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\1\On March 17, 2021, the Committee approved S. 688, the BOLIVAR
Act. That bill, as reported, is substantially similar to S. 257.
Accordingly, this committee report is in many respects similar to the
committee report for S. 688. See S. Rept 117-28.
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II. BACKGROUND AND NEED FOR THE LEGISLATION
Nicolas Maduro was elected President of Venezuela on April
14, 2013, following the death of former Socialist Party
President Hugo Chavez. Under Maduro, the Venezuelan government
has abused the rights of the Venezuelan people through
violence, control, repression, and by cracking down on public
demonstrations.\2\ Security forces have repressed opposition
parties through detention, military prosecution, and the
excessive use of force against protestors. Opponents and
critics of the regime risk being detained, imprisoned,
tortured, and assassinated. According to a 2019 United Nations
Human Rights report, Venezuelan security forces killed at least
5,287 people during security operations in 2018, alleging
``resistance to authority.''\3\ Between January 1 and May 19 of
2019, another 1,569 people were killed.
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\2\Human Rights Watch, World Report 2017: Events of 2016, 661-667
(www.hrw.org/sites/
default/files/world_report_download/wr2017-web.pdf).
\3\Press Release, Office of the High Commissioner, United Nations,
UN Human Rights Report on Venezuela Urges Immediate Measures to Halt
and Remedy Grave Rights Violations (July 4, 2019) (www.ohchr.org/EN/
NewsEvents/Pages/DisplayNews.aspx?NewsID=24788&LangID=E).
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In addition to committing pervasive human rights abuses,
Maduro's regime has exploited the economy and engaged in
widespread corruption.\4\ Despite having among the world's
largest oil reserves, millions of Venezuelans starve because
the government fails to import sufficient food for the
Venezuelan people, engages in rampant corruption of the food
distribution program, and rejects offers of humanitarian
aid.\5\ Maduro's regime has been compared to a criminal
organization;\6\ is involved in drug trafficking, money
laundering,\7\ and illegal gold transfers;\8\ and is said to
associate with terrorist groups.\9\ For years, Maduro's inner
circle has enriched itself by capitalizing on a network of
corruption while his people struggle to survive.\10\
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\4\Fact Sheet, Office of the Spokesperson, U.S. Department of
State, Nicolas Maduro: Corruption and Chaos in Venezuela (Aug. 6, 2019)
(cl.usembassy.gov/nicolas-maduro-corruption-and-chaos-in-venezuela-2/).
\5\Id.; see also, The U.S. Says Maduro is Blocking Aid to Starving
People. The Venezuelan Says His People Aren't Beggars, Washington Post
(Feb. 8, 2019) (www.washingtonpost.com/world/2019/02/08/us-says-maduro-
is-blocking-aid-starving-people-venezuelan-says-his-people-arent-
beggars/).
\6\Study Finds Venezuela Criminal Enterprise is Blunting Effects of
U.S. Sanctions, Miami Herald (May 15, 2019) (www.miamiherald.com/news/
nation-world/world/americas/venezuela/article230420019.html).
\7\U.S. Accuses Maduro, Venezuelan Party Official of Drug Trade
Profiteering, Reuters (May 18, 2018) (www.reuters.com/article/us-usa-
venezuela-sanctions/u-s-accuses-maduro-venezuelan-party-official-of-
drug-trade-profiteering-idUSKCN1IJ2JZ).
\8\These are the Refineries Processing Venezuela's ``Blood Gold''--
and Helping Maduro Stay in Power, Miami Herald (July 23, 2019)
(www.miamiherald.com/news/nation-world/world/americas/venezuela/
article232452267.html).
\9\Venezuela Is Terrorist Sanctuary: Colombian President, U.S. News
(July 29, 2019) (www.usnews.com/news/world/articles/2019-07-29/
venezuela-is-terrorist-sanctuary-colombian-president).
\10\How Miami, a Major Destination for Venezuelan Gold, is Helping
Prop up Maduro's Regime, Miami Herald (July 23, 2019, updated Aug. 5,
2019) (www.miamiherald.com/news/nation-world/world/americas/venezuela/
article230669164.html); see also, Nicolas Maduro: Corruption and Chaos
in Venezuela, supra note 5.
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The United States has sanctioned entities affiliated with
the Maduro regime, while allowing transactions with the
legitimate Venezuelan government, the Interim President Juan
Guaido and the Venezuelan National Assembly.\11\ Sanctions are
enforced through the Office of Foreign Assets Control (OFAC)
and State Department diplomatic actions.
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\11\Press Release, U.S. Department of the Treasury, Treasury
Sanctions Nicholas Maduro's Son for Serving in Venezuela's Illegitimate
Government (June 28, 2019) (home.treasury.gov/news/press-releases/
sm719); see also, Treasury Sanctions Maduro Regime Officials for
Undermining Democratic Order in Venezuela (Sept. 4, 2020)
(home.treasury.gov/news/press-releases/sm1115).
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The BOLIVAR Act complements existing efforts, such as
sanctions, by prohibiting an executive agency from entering
into a contract for the procurement of goods or services with
any person that has business operations with the illegitimate
government of the Maduro regime, as well as any successor
governments not recognized as legitimate by the United States.
The bill outlines particular exceptions. The BOLIVAR Act was
first introduced by Senator Rick Scott in the 117th Congress.
It passed the Senate by voice vote on December 15, 2022, but
did not become law.\12\
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\12\S. 688, 117th Cong. (2021).
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III. LEGISLATIVE HISTORY
Senator Rick Scott (R-FL) introduced S. 257, the BOLIVAR
Act, on February 2, 2023, with Senators Jacky Rosen (D-NV),
Marco Rubio (R-FL), and Thom Tillis (R-NC) as original
cosponsors. The bill was referred to the Committee on Homeland
Security and Governmental Affairs.
The Committee considered S. 257 at a business meeting on
March 29, 2023. During the business meeting, the bill was
ordered reported favorably by roll call vote of 10 yeas and 1
nay, with Senators Peters, Hassan, Rosen, Padilla, Ossoff,
Blumenthal, Lankford, Romney, Scott, and Hawley voting in the
affirmative, and with Senator Paul voting in the negative.
Senators Carper, Sinema, Johnson, and Marshall voted yea by
proxy, for the record only.
IV. SECTION-BY-SECTION ANALYSIS OF THE BILL, AS REPORTED
Section 1. Short title
This section establishes the short title of the bill as the
``Banning Operations and Leases with the Illegitimate
Venezuelan Authoritarian Regime Act,'' or the ``BOLIVAR Act.''
Section 2. Prohibition on contracting with persons that have business
operations with the maduro regime
Subsection (a) prohibits federal agencies from contracting
for goods and services with any person that knowingly engages
in significant business operations with an authority of the
Government of Venezuela that is not recognized as the
legitimate Government of Venezuela by the United States.
Subsection (b) provides exceptions for instances where the
Secretary of State determines that the business operations with
the illegitimate Venezuelan government are necessary for the
provision of humanitarian assistance, disaster relief, other
urgent life-saving measures, noncombatant evacuations, or is
otherwise in the national security interests of the United
States. It requires that Congress be notified of any exception
for those reasons. The Secretary of State must notify the
appropriate congressional committees of any contract entered
into on the basis of one of these exceptions.
Subsections (c) and (d) clarify the prohibition does not
apply to contracts that support U.S. Government activities in
Venezuela or to contracts with international organizations. It
also does not apply to contracts related to the operation and
maintenance of the U.S. Government's facilities in Venezuela.
Subsection (e) provides that the Secretary of State may
waive the prohibition after determining it is in the national
interest to do so.
Subsection (f) defines: ``appropriate congressional
committees,'' ``business operations,'' ``executive agency,''
``Government of Venezuela,'' and ``person.''
Finally, subsection (g) stipulates that this section
applies to any contract entered into during the three-year
period beginning on the date of enactment.
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 ESTIMATES
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
S. 257 would prohibit executive branch agencies from
entering into contracts with entities that have significant
business operations with the Venezuelan government unless the
United States recognizes that government as legitimate. The
Secretary of State could waive that prohibition for contracts
to provide humanitarian assistance, disaster relief, or that
are in the national security interests of the United States.
CBO is not aware of any contracts that would be banned
under the bill. CBO estimates monitoring contracting activity
for compliance would cost the Department of State less than
$500,000 annually and total about $1 million over the 2023-2028
period. Such spending would be subject to the availability of
appropriated funds.
The CBO staff contacts for this estimate are Sunita D'Monte
(for the Department of State) and Matthew Pickford (for general
government). The estimate was reviewed by Chad Chirico, Deputy
Director of Budget Analysis.
Phillip L. Swagel,
Director, Congressional Budget Office.
VII. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
Because S. 257 would not repeal or amend any provision of
current law, it would make no changes in existing law within
the meaning of clauses (a) and (b) of paragraph XXVI of the
Standing Rules of the Senate.
[all]