Authorization bill attracts contracting reform amendments

By Dan Friedman

May 6, 2008

Democratic lawmakers are eyeing the House and Senate fiscal 2009 defense authorization bills as vehicles for a series of measures that would change the acquisition system, staffers and industry officials say.

The House recently passed several contracting reform bills that emerged from the House Oversight and Government Reform Committee. But with similar stand-alone Senate measures not yet taken up in committee, the annual Pentagon policy bill -- scheduled to be marked up by Armed Services subcommittees this week -- may offer the best chance for the measures to become law, House aides and lobbyists said.

"We have heard pretty clearly that there will be effort to put [the Oversight Committee bills] in the defense authorization bill," said Peter Steffes, vice president for government policy at the National Defense Industrial Association. "That's the only train they have leaving the station."

The House on April 23 approved bills mandating a government-wide contractor performance database, forcing firms that earn most of their revenue from federal contracts to reveal salaries of top officers and ensuring that contractors overseas self-report criminal violations.

On April 15, the House also passed a bill barring firms with tax debts from winning large government contracts. Companion Senate measures to the database and tax bills have been introduced, but the Senate Homeland Security and Governmental Affairs Committee has taken no action on either one.

A House aide familiar with the issue said Monday that there will almost certainly be efforts to attach the acquisition measures to the defense authorization bill next week during the full committee's markup or during floor debate on the bill expected the week of May 19.

"I imagine that if it [the contracting language] doesn't come out of committee, someone will try to amend it on the floor," the aide said.

Observers also said the Senate's defense authorization bill, which was marked up last week by the Senate Armed Services Committee, may be amended to include contracting language when it reaches the floor. Senate Armed Services Committee Chairman Carl Levin, D-Mich., has said he hopes the chamber will consider the bill before Memorial Day.

Noting that "must-pass" legislation like the defense policy bill and key appropriations measures "become like Christmas trees for bills that would never pass on their own," Trey Hodgkins, senior director of defense and intelligence programs for Information Technology Association of America, said his group is concerned that measures they oppose, such as the House's contractor database bill, could be attached with little debate.

Steffes said he expects a bill introduced April 25 by Sen. Hillary Rodham Clinton, D-N.Y. -- which would require contractors to report crimes by their employees and overpayments they receive -- to be offered as an amendment to the defense bill.

Several acquisition-related measures were already attached to the bill during last week's markup. These include a requirement that the Pentagon create ethics standards to prevent conflicts of interest by contractors who oversee other contractors, language preventing contractor employees from interrogating detainees and a provision ensuring security contractors do not perform "inherently governmental functions," that involve likely combat.

Another provision, similar to a bill introduced by Illinois Democratic Sens. Barack Obama and Richard Durbin, seeks to block contractors who use overseas subsidiaries to avoid taxes from receiving competitive advantages.

Sen. Claire McCaskill, D-Mo., also attached an amendment, similar to a stand-alone bill she has introduced, requiring the Pentagon to create a database of contractors who have been disciplined for violating procurement laws or regulations.

By Dan Friedman

May 6, 2008