by making clear that GAO awards of costs and fees are only recommendations.

The legislation would greatly streamline procurement operations by allowing agencies to make greater use of simplified procedures, commonly referred to as small purchase procedures, for those smaller dollar purchases that are partially or fully conducted using electronic data interchange (EDI] capabilities. It provided for an increase in the small purchase threshold to $50,000 for any procurement for which notice has been given through a governmentwide acquisition computer network system, and to $100,000 for any procurement where, in addition to providing notice, such system is used to make available information in response to requests, place orders, and provide public notice of award. Where agencies choose not to use EDI capabilities, use of small purchase procedures will continue to be limited to procurements not greater than $25,000. The bill would authorize the Administrator of Federal Procurement Policy to conduct up to six test programs to identify alternative and innovative procurement procedures. The tests, which would be closely monitored by GAO for the Congress, must be conducted in accordance with detailed test plans which would be reviewed by Congress and published in the Federal Register for public comment. Each test must also comply with certain limitations related to, among other things, duration and contract dollar value. This authority would provide agencies the opportunity, under controlled conditions, to build an empirical record in support of future procurement reform initiatives.

Lastly, the bill would authorize functions and activities under the Federal Property and Administrative Services Act of 1949, including certain operations of the General Services Administration, through fiscal year 1996. The authorization would replace the current permanent authorization, and will put GSA on a normal, cyclical authorization cycle. A recurring authorization would provide the cognizant congressional oversight committees with the opportunity to more closely monitor the agency's efforts to address its many problems.

H.R. 2238 was introduced on May 24, 1993, and referred jointly to the Committee on Armed Services. On July 28, 1993, the Legislation and National Security Subcommittee considered and approved an amendment in the nature of a substitute offered by Chairman Conyers and supported by Ranking Minority Member Clinger, and reported the bill favorably to the full committee by voice vote.

On July 28, 1993, the full committee considered H.R. 2238, as reported by the Legislation and National Security Subcommittee. One amendment, offered by Mrs. Collins (D-IL), was adopted by voice vote (see explanation of amendments below). With a reporting quorum present, the committee approved H.R. 2238, as amended, and reported the bill favorably to the House by voice vote.

d. Federal Acquisition Streamlining Act of 1994; S. 1587.-On June 27, 1994, after months of cooperative effort with the Armed Services Committee, a comprehensive amendment in the nature of a substitute to H.R. 2238 passed the House. S. 1587, the Senate companion procurement reform bill, passed the House in lieu after striking all after the enacting clause and inserting the text of H.R.

2238 as passed. S. 1587 went to conference on August 12, 1994, and the conference reports were voted favorably out of both Houses. S. 1587 was signed into law (Public Law 103-355) on October 13, 1994.

The Federal Acquisition Streamlining Act of 1994 (S. 1587) represents the most comprehensive governmentwide acquisition reform effort in over a decade. The principal objective of this legislation is to strike a more equitable balance between the multitude of government-unique policy requirements imposed on Federal procurements and the need to lower the government's cost of doing business. The bill would accomplish this objective by increasing the government's reliance on the use of commercial practices, goods, and services; by creating a new category of high-volume, low-value Federal procurements by streamlining rules and regulations; and by improving access by small business to government contracting opportunities.

The bill would extend to civilian agencies a number of authorities and procedures that exist for Department of Defense procurements. In most cases, this will create a uniform governmentwide acquisition policy.

The Government spends approximately $200 billion a year on the procurement of goods and services. Despite this huge expenditure of money, the present acquisition system remains complicated and confusing, wasting billions of scarce taxpayer dollars. It is burdened with an outmoded and fragmented statutory foundation, regulatory and procedural proliferation beyond comprehension, an underdeveloped work force and an absence of individual accountability.

Two comprehensive reviews-the Acquisition Law Advisory Panel on Streamlining and Codifying Defense Acquisition Law (the so-called section 800 panel review) and, more recently, the National Performance Review (led by Vice President Gore)-have documented the need to streamline procurement procedures to increase access and competition in Federal procurement, and save the government money. This is particularly critical in the defense sector where maintaining a dedicated defense industrial base is an increasingly unaffordable option.

Both studies concluded that the Federal procurement system has evolved into a complex maze of laws and regulations that makes the process too cumbersome and fails to provide sufficient incentives for suppliers to deliver quality products and services at reasonable prices, or to allow Federal personnel to exercise prudent discretion and good business judgment.

Many of the NPR recommendations tracked those of the section 800 panel. For example, both recommended increasing the small purchase threshold (redefined as the "simplified acquisition threshold") to $100,000, and both endorsed increased procurement of commercial items. Other recommendations included:

Encouragement of procurement innovation;
Streamlining procurement protest rules;
Expanding electronic commerce;

Encouraging best value procurements; and

Conforming certain procurement statutes in their application to civilian and defense agencies.

Following are brief summaries of the major provisions of S. 1587 as agreed to in conference:

Commercial items.-The Federal Acquisition Streamlining Act creates statutory authority to permit the government to buy commercial items on commercial terms.

Currently, it is very costly and difficult for commercial companies to provide the cost information required to do business with the Government, comply with government unique terms and conditions, and grant the government blanket financial audit rights. In addition, many of these requirements are currently "flowed down" by a prime contractor to its subcontractors. Such contracting requirements are mostly alien to the commercial marketplace and have served as "barriers" in keeping out entire categories of commercial vendors from the government market.

The act establishes a specific preference for procurements of commercial items, which exempts such procurements from a number of statutory requirements, including several that currently "flowed-down" to subcontractors.

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Truth in Negotiations Act [TINA].—The act amends the Truth in Negotiations Act [TINA] which results in one of the more onerous burdens of industry due to the amount of financial information that a Federal contractor is required to submit to the government.

The act permanently increases the threshold to $500,000 (adjusted for inflation), below which specific cost or pricing data is not required. It also creates exceptions for commercial items.

Commercial financing.-S. 1587 would provides contracting officers with the option to use commercial financing practices when purchasing commercial items.

Allowable costs.-In order to provide greater uniformity regarding the allowability of costs for cost-plus contracts, the act extends to contractors working with civilian agencies the same standards on cost allowances currently applicable to defense contractors. The threshold for covered contracts, for both DOD and civilian agencies, is increased to $500,000.

Debriefings and bid protests.-The Federal Acquisition Streamlining Act modifies requirements regarding debriefings and bid protests in order to discourage the current practice of filing unnecessary or frivolous protests by losing bidders in Federal procurement competitions.

Agencies are required to provide notice of an award decision, either electronically or in writing, to all offerors within 3 days of contract award.

Furthermore, agencies are required to provide a comprehensive, detailed debriefing. The act requires the offeror to request the debriefing within 3 days of receipt of notification of contract award and the agency to provide the debriefing within, to the maximum extent practicable, 5 days of the request. In addition, contractors would have 10 days or 5 days after a requested debriefing, whichever is later, to file a protest. The intent is to reduce the motivation for filing protests merely to reserve that right as is the current practice.

Simplified acquisition threshold.-In order to focus government oversight and controls on procurements of critical consequence, the Federal Acquisition Streamlining Act creates a simplified acquisi

tion threshold [SAT] of $100,000, below which procurements can occur with a streamlining of government requirements; such procurements would be exempt from a number of statutory requirements.

The act requires notice in the Commerce Business Daily or an electronic notice for contracts under $100,000. It also requires the implementation of a Federal acquisition computer network within 5 years of date of enactment.

FACNET.-Capitalizing on advances in information technology, S. 1587 creates a Federal acquisition computer network [FACNET], intended to facilitate, streamline, and shorten the contracting process. This computerized system would also greatly increase visibility and access by smaller companies to nationwide Federal contracting opportunities.

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Micropurchases. In addition, the act establishes micropurchase threshold of $2,500. Contracts awarded under this threshold would be exempt from a number of statutory require

ments.

Test programs.-The act authorizes the Administrator of Federal Procurement Policy to conduct tests of alternative and innovative procurement procedures. The Administrator would be authorized to waive specific provisions of law and regulations. This test authority is for 4 years.

The act also authorizes one test program at the Federal Aviation Administration-for carrying out acquisitions for one of the modernization programs under the Airway Capital Investment Plan.

Furthermore, S. 1587 designates 5 DOD programs as pilot programs and authorize the testing of commercial-type acquisition procedures for these programs. These programs are: (1) Fire Support Combined Arms Tactical Trainer [FSCATT]; (2) Joint Direct Attack Munition [JDAM I]; (3) Joint Primary Aircraft Training System [JPATS]; (4) Commercial-Derivative Aircraft [CDA]; and (5) Commercial-Derivative Engine.

Minority contract goal program.-The act establishes a section. 1207 program (contracting procedures for furthering the goal for small disadvantaged businesses) for civilian agencies similar to the program for DOD.

Small business training for procurement personnel. The act S. 1587 authorizes training courses for critical procurement personnel to increase the participation of small disadvantaged businesses and women in the Federal procurement process.

Subcontractor payment protection. The act requires regulations governing payment protections for first-tier subcontractors and suppliers under most Government contracts. Similar protections already are provided to DOD subcontractors.

e. Revolving Door Sunshine Act of 1993; H.R. 1593.—Current disclosure laws have significant gaps in who is required to disclose his or her official contacts with Congress and the Executive branch. On April 1, 1993 Chairman Conyers introduced H.R. 1593 in order to close these gaps for former senior Federal officials. The bill was referred solely to the Committee on Government Operations.

The Subcommittee on Legislation and National Security held a hearing on the bill on September 30, 1993. On October 28, 1993, the Committee on Government Operations, by voice vote, ordered

the bill, as amended, reported. The bill as reported amends the Government in the Sunshine Act to require the President, the Vice President, senior executive branch officials, Members of Congress, and senior congressional staff to report their official contacts with Congress and the executive branch for 5 years after they leave the Federal Government. In addition, they must disclose for 5 years whether they are working for a foreign government, a foreign political party, or a foreign business entity. The report was filed on November 10, 1993. H. Rept. 103-354, part I.

The bill was sequentially referred to the Committee on the Judiciary, which was discharged from further consideration of the bill on April 29, 1994.

f. Government Savings and Reform Act of 1993; H.R. 3400.—Introduced on October 28, 1993, by Representative Gephardt, H.R. 3400 was proposed by the administration to implement the recommendations of the Vice President's National Performance Review [NPR]. It was referred jointly to the standing committee's of the House of Representatives, to be reported or discharged out of committee by November 15, 1993.

The committee had jurisdiction over Title XV, Streamlining Management Control, Title XVI, Financial Management Reforms, and Title XVII, Year-End Spending.

Title XV, provides the Director of the Office of Management and Budget the authority to propose, through the annual budget submission, the consolidation or elimination of duplicate or obsolete reporting requirements, and to make adjustments to deadlines for reports.

Title XVI, Financial Management Reforms, includes provisions on electronic benefits transfers, franchise and innovation funds, simplifying the management reporting process, annual financial audits, and strengthening debt collection. Title XVII, year-end spending provisions, would allow agencies to rollover 50 percent of unspent, yearend balances.

After holding a legislative hearing, the committee was discharged without further consideration on November 15, 1993, to help expedite its passage by the House. On November 22, 1993, the House passed H.R. 3400 and it was sent to the U.S. Senate where it was referred to the Committee on Governmental Affairs. (See v., S. 2170 of this section.)

g. The Omnibus Budget Reconciliation Act of 1993; H.R. 2264.— H.R. 2264, the Omnibus Budget Reconciliation Act of 1993, met the spending reductions required by the budget resolution implementing the administration's budget. The Committee on Government Operations was not reconciled to produce legislative savings. However, the budget resolution called for the revisions of budgetary discipline imposed by the Budget Enforcement Act of 1990, legislation under the jurisdiction of the Committee on Government Operations pursuant to House Rule X(1)(j). Additionally, several committees of the House, responding to reconciliation instructions of their own, raised issues within the committee's jurisdiction. Consequently, the committee was named as a conferee to titles I (subtitles B and D), IV (subtitle A), V (subtitle B), IX, XIII (subtitle C), XV, and XVI. The Senate passed an exemption from Federal procurement law for the Electric and Telephone Loan Program under the Rural Elec