Department of Homeland Security's Use of Special Streamlined
Acquisition Authorities in Section 833 of the Homeland Security
Act of 2002 (20-JUN-06, GAO-06-783R).
In creating the Department of Homeland Security (DHS) in the wake
of September 11, 2001, some in Congress were concerned that the
Department might not be able to conduct acquisitions with
sufficient speed, particularly in an emergency. To that end,
Congress enacted section 833 of the Homeland Security Act of
2002, which provides DHS with special streamlined acquisition
authorities. Before those authorities could be used, however, the
Secretary of Homeland Security or a delegate would have to
determine in writing that the DHS mission would be seriously
impaired without the use of the authorities. The special
streamlined acquisition authorities including the following three
items. First, increasing the micro-purchase threshold from $2,500
to $7,500. Purchases below the micro-purchase threshold do not
require competitive quotes or compliance with the "Buy America"
act. Only certain employees would be authorized to make
procurements under this authority. Second, increasing the limit
on the use of simplified acquisition procedures from $100,000 to
$200,000 for contracts awarded and performed within the United
States, and to $300,000 for contracts awarded and performed
outside the United States. Simplified acquisition procedures
permit agencies to use streamlined techniques to acquire good and
services. Third, increasing from $5,000,000 to $7,500,000 the
ceiling on the use of special simplified procedures to acquire
property and services the Secretary deems to be "commercial
items" under federal procurement laws. These authorities are
scheduled to expire on September 30, 2007. Section 833 of the act
directed us to report on the Department's use of these special
streamlined acquisition authorities. Our objectives were to
determine (1) the extent to which DHS has used the special
authorities and (2) whether DHS sees a need to extend the
authorities beyond September 2007.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-06-783R
ACCNO: A55785
TITLE: Department of Homeland Security's Use of Special
Streamlined Acquisition Authorities in Section 833 of the
Homeland Security Act of 2002
DATE: 06/20/2006
SUBJECT: Buy national policy
Emergency preparedness
Federal procurement
Federal procurement policy
Procurement law
Procurement practices
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GAO-06-783R
June 20, 2006
The Honorable Susan M. Collins Chairman The Honorable Joseph I. Lieberman
Ranking Member Committee on Homeland Security and Governmental Affairs
United States Senate
The Honorable Tom Davis Chairman The Honorable Henry A. Waxman Ranking
Member Committee on Government Reform House of Representatives
The Honorable Peter T. King
Chairman The Honorable Bennie G. Thompson
Ranking Member Committee on Homeland Security
House of Representatives
Subject: Department of Homeland Security's Use of Special Streamlined
Acquisition Authorities in Section 833 of the Homeland Security Act of
2002
In creating the Department of Homeland Security (DHS) in the wake of
September 11, 2001, some in Congress were concerned that the Department
might not be able to conduct acquisitions with sufficient speed,
particularly in an emergency. To that end, Congress enacted section 833 of
the Homeland Security Act of 2002, which provides DHS with special
streamlined acquisition authorities. Before those authorities could be
used, however, the Secretary of Homeland Security or a delegate would have
to determine in writing that the DHS mission would be seriously impaired
without the use of the authorities. The special streamlined acquisition
authorities included:
o Increasing the micro-purchase threshold from $2,500 to $7,500.
Purchases below the micro-purchase threshold do not require
competitive quotes or compliance with the "Buy America" act. Only
certain employees would be authorized to make procurements under
this authority.
o Increasing the limit on the use of simplified acquisition
procedures from $100,000 to $200,000 for contracts awarded and
performed within the United States, and to $300,000 for contracts
awarded and performed outside the United States. Simplified
acquisition procedures permit agencies to use streamlined
techniques to acquire good and services.1
o Increasing from $5,000,000 to $7,500,000 the ceiling on the use
of special simplified procedures to acquire property and services
the Secretary deems to be "commercial items" under federal
procurement laws.
These authorities are scheduled to expire on September 30, 2007.
Section 833 of the act directed us to report on the Department's use of
these special streamlined acquisition authorities. Our objectives were to
determine (1) the extent to which DHS has used the special authorities and
(2) whether DHS sees a need to extend the authorities beyond September
2007. We conducted our review from April to May 2006 in accordance with
generally accepted government auditing standards.
RESULTS
The Department of Homeland Security has never used the special streamlined
acquisition authorities provided in section 833. According to the Director
of Acquisition Oversight at DHS, use of the special authorities has not
been needed because existing authorities have been sufficient to meet DHS
requirements. For example, the Department makes frequent use of the
current $2,500 micro-purchase threshold and that threshold may increase up
to $15,000 for domestic purchases made in support of a contingency
operation if certain determinations are made. With respect to simplified
acquisition procedures, the Department currently uses these procedures for
nearly 2,000 procurements annually up to $100,000, and according to DHS,
increasing the limit to $200,000 would make only 100 additional
procurements eligible for these procedures. For these or other
procurements, including those involving commercial items, there is
authority under Part 16.603 of the Federal Acquisition Regulation (FAR) to
award letter contracts in emergencies or other appropriate circumstances,
up to the warranted level of the procurement official. Finally, DHS can
use the flexibility provided by FAR Part 6.3, which provides for
contracting without full and open competition if the required
justifications and approvals are obtained.
Agency officials also said that the increased authorities provided for
under section 833 are not worth the time and effort required to justify
their use given the relatively modest increase in flexibility those
authorities provide. Specifically, officials said that the approval
procedures for using the authorities are time consuming and noted that
approval can only be delegated to a presidential appointee who has been
confirmed by the Senate. At this time, this limits the approving officials
within the Department to just the Secretary, the Deputy Secretary, and the
Under Secretary for Management.
1 While simplified acquisition procedures promote competition to the
maximum extent practicable, they are designed to: (1) reduce
administrative costs; (2) improve opportunities for small, disadvantaged,
and women-owned businesses to obtain a fair proportion of government
contracts; (3) promote efficiency and effectiveness in contracting; and
(4) avoid unnecessary burdens for agencies and contractors. Federal
Acquisition Regulation, at 13.002.
DHS officials told us that the Department has no interest in extending the
special acquisition authorities of section 833. They believe the
authorities should be allowed to expire at the end of September 2007.
AGENCY COMMENTS
We provided a draft of this letter to the Department of Homeland Security
for its review and comment. Department officials indicated in an e-mail
message that the letter was accurate and that the Department had no
additional comments.
We are sending copies of this letter to other interested congressional
committees and Members, and to the Secretary of Homeland Security. We will
make copies available to others upon request. In addition, it will be
available at no charge on the GAO Web site at http://www.gao.gov .
If you have any questions regarding this letter, please contact me at
(202) 512-4841 or John Needham, Assistant Director, at (202) 512-5274.
Contact points for our Office of Congressional Relations and Public
Affairs may be found on the last page of this letter. Other contributors
to this effort include Myra Watts Butler, John Krump, and Robert
Swierczek.
William T. Woods
Director
Acquisition and Sourcing Management
(120534)
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