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The Senate Homeland Security and Governmental Affairs Committee Wednesday approved a bill that seeks to save the federal government $300 million a year by eliminating waste and abuse in the purchase card system.

The legislation (S. 457) introduced by Committee Chairwoman Susan Collins, R-Maine, passed by voice vote. The bill implements recommendations in a General Accountability Office (GAO) report released last year on the cards, which are credit cards issued by all executive and legislative branch agencies to some employees - such as office managers - to buy goods and services.

The report found that even though government workers spend about $16 billion a year using the cards, agencies do little to look for potential savings. The GAO estimated the federal government could save $300 million a year by issuing more stringent guidelines on the cards' use, then monitoring it closely.

The measure gives the Office of Management and Budget (OMB) and the General Services Administration (GSA) authority to instruct agencies on how to use the cards. Within 180 days of the bill's enactment, OMB must provide the directors of federal agencies with an analysis of their purchase card use and highlight areas where savings are possible.

OMB and the GSA must also work with vendors who accept purchase cards to negotiate discounts and notify federal employees of them. The bill also requires OMB to report to Congress regularly on how each agency uses the cards and how much money has been saved government-wide since the enactment of the bill.

Sen. Norm Coleman, R-Minn., put forth an amendment, approved by voice vote, calling for the Internal Revenue Service and the Financial Management Service to block purchase card payments to federal contractors with federal tax debt. Coleman, who is chairman of the Permanent Subcommittee on Investigations, has recently held hearings on federal contractors who do not pay taxes.

Sen. Thomas Carper, D-Del., praised the amendment and said that while the issue might require further legislation, the provision is "a good place to start."

Coleman's amendment would also require federal agencies to submit information to Congress on first class and business class travel, made at the expense of the government. The amendment would call for agencies to include the names of each traveler, the date of the trip, the price of the business or first ticket and the difference in cost between those tickets and coach class.

Collins sponsored an amendment, also accepted on voice vote, which made technical changes to the bill.

A spokeswoman for the committee declined to say whether the Senate was likely to vote on the measure this session. She noted the unanimous voice vote indicated it had strong support in committee, which could make a priority for floor action.

COMMENTS

• It's funny that Congress is so concerned about charge card abuses, this from the institution that stuck the American taxpayers holding the tab for millions of dollars in bounced checks??? How about the millions wasted by Congress in the furnishing or re-furnishing of their offices??? GovExec.com reader Posted June 27, 2005 3:29 PM
• I agree that the purchase card saves the back door costs of Agencies such as DFAS. However the card program has increased the management and oversight at the front end--that should be there but may not be. In the past two years we have been directed to use the E-Mall. If you take a close look at emall pricing you will find that most of the items cost significantly more than using competition in the local area. From the same company! If Congress and OMB want to look at abuse they need to hold to task the fools in the beltway who think they are doing fabulous things in the emall negotiations. That's the abuse. The of course there is the user who is expected to be an acquisition, legal and financial wiz. I assure you may purchases are being made for unauthorized items and there are probably many antideficiency act violations out there that can't be founc because it is impossible to police. Besides--it's too late after the fact. Then the Congress is worried about the scandals and abuse when the people who used to perform the oversight before it became a problem were reduced. People in th ebelt way making hte policies should be held pecunarly liable (SES, OMB Congress, OSD)for the fraud and wastes at the lowest level of any agency. They insulate themselves by blaming lack of oversight on the staffs they decimated GovExec.com reader Posted June 25, 2005 11:31 AM
• Purchase Cards only save money to the extent they eliminate the back-office finance functions (little things like small purchase officers, voucher examiners, etc.) who used to do this but now are gone. Bosses, managers, and OMB won this battle - now we find out that the internal controls on spending the $$ went out the door with the people. It's real easy to get all that $16B spent - but who knows what the gov't has bought? Oh, I can think of one thing the Gov't has bought - we're paying Citicorp, Rocky Mtn Bank, and other similar outfits a nice transaction fee (probably 1-2% or so) everytime someone buys something using that card. Wonder what that adds up to each year? Gee, wonder if that's cranked into the "savings". GovExec.com reader Posted June 24, 2005 1:51 PM