PDF(PDF provides a complete and accurate display of this text.)Tip?
Calendar No. 188
116th Congress } { Report
SENATE
1st Session } { 116-84
______________________________________________________________________
FEDERAL ADVANCED CONTRACTS ENHANCEMENT ACT
__________
R E P O R T
of the
COMMITTEE ON HOMELAND SECURITY AND
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
to accompany
S. 979
TO AMEND THE POST-KATRINA EMERGENCY MANAGEMENT
REFORM ACT OF 2006 TO INCORPORATE THE RECOMMENDATIONS
MADE BY THE GOVERNMENT ACCOUNTABILITY OFFICE RELATING TO ADVANCE
CONTRACTS, AND FOR OTHER PURPOSES
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
September 10, 2019.--Ordered to be printed
_________
U.S. GOVERNMENT PUBLISHING OFFICE
89-010 WASHINGTON : 2019
COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
RON JOHNSON, Wisconsin, Chairman
ROB PORTMAN, Ohio GARY C. PETERS, Michigan
RAND PAUL, Kentucky THOMAS R. CARPER, Delaware
JAMES LANKFORD, Oklahoma MAGGIE HASSAN, New Hampshire
MITT ROMNEY, Utah KAMALA D. HARRIS, California
RICK SCOTT, Florida KYRSTEN SINEMA, Arizona
MICHAEL B. ENZI, Wyoming JACKY ROSEN, Nevada
JOSH HAWLEY, Missouri
Gabrielle D'Adamo Singer, Staff Director
Joseph C. Folio III, Chief Counsel
Barrett F. Percival, Professional Staff Member
David M. Weinberg, Minority Staff Director
Zachary I. Schram, Minority Chief Counsel
Christopher J. Mulkins, Minority Senior Professional Staff Member
Laura W. Kilbride, Chief Clerk
Calendar No. 188
116th Congress } { Report
SENATE
1st Session } { 116-84
======================================================================
FEDERAL ADVANCED CONTRACTS ENHANCEMENT ACT
_______
September 10, 2019.--Ordered to be printed
_______
Mr. Johnson, from the Committee on Homeland Security and Governmental
Affairs, submitted the following
R E P O R T
[To accompany S. 979]
[Including cost estimate of the Congressional Budget Office]
The Committee on Homeland Security and Governmental
Affairs, to which was referred the bill (S. 979) to amend the
Post-Katrina Emergency Management Reform Act of 2006 to
incorporate the recommendations made by the Government
Accountability Office relating to advance contracts, and for
other purposes, having considered the same, reports favorably
thereon with amendments and recommends that the bill, as
amended, 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......................................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............6
I. Purpose and Summary
S. 979, the Federal Advance Contracts Enhancement Act of
2019, codifies nine recommendations made by the Government
Accountability Office (GAO) related to the Federal Emergency
Management Agency's (FEMA) use of advance contracting in
carrying out its mission responsibilities. GAO's
recommendations require FEMA to, among other things, update its
strategy and guidance to clarify the use of advance contracts,
improve the timeliness of its acquisition planning activities,
and provide more consistent guidance, information, and
coordination with states and localities to establish advance
contracts. It also requires that FEMA report to Congress on its
implementation efforts.
II. Background and the Need for Legislation
Following Hurricane Katrina in 2005, the Congress enacted
the Post-Katrina Emergency Management Reform Act of 2006
(PKEMRA) to address various shortcomings identified in
preparation for and response to Hurricane Katrina.\1\ One of
those reforms required FEMA to establish advance contracts.
Advance contracts are contracts that are established prior to
disasters and that are typically needed to quickly provide
life-sustaining goods and services in the immediate aftermath
of disasters.\2\ Other requirements in PKEMRA include that
FEMA: coordinate advance contracts with state and local
governments, encourage state and local governments to engage in
similar pre-planning and contracting, and develop a contracting
strategy.\3\
---------------------------------------------------------------------------
\1\Pub. L. No. 109-295, Sec. 691 (codified at 6 U.S.C. Sec. 791).
\2\Id.
\3\Id.
---------------------------------------------------------------------------
To satisfy the requirements in PKEMRA, FEMA created an
advance contracting strategy, which was outlined in its report
to the Congress in 2007.\4\ According to its strategy, FEMA
``will maximize the use of advance contracts to the extent they
are practical and cost-effective, which will help preclude the
need to procure goods and services under unusual and compelling
urgency.''\5\
---------------------------------------------------------------------------
\4\Department of Homeland Security, Federal Emergency Management
Agency, Advance Contracting of Goods and Services Report to Congress
(Dec. 2007).
\5\Id.
---------------------------------------------------------------------------
Advance contracts are important because if contracts are
not in place before a disaster strikes and a disaster is
declared, FEMA could enter into contracts under ``unusual and
compelling urgency'', a position that exempts the agency from
full and open competition requirements.\6\ In these instances,
FEMA enters into non-competitive contracts to deliver life-
sustaining resources to suffering communities.\7\ When
resources are exhausted and contracts are entered into on a
non-competitive manner, previous experience shows that the
product typically ends up being produced at a higher cost to
the Federal Government.\8\ In recognition of that, Congress
required FEMA to leverage the use of advanced contracts and
develop strategies to prioritize their use in PKEMRA.\9\
---------------------------------------------------------------------------
\6\Id.
\7\Id.
\8\Id.
\9\Id.
---------------------------------------------------------------------------
At the request of Congress, GAO reviewed the Federal
Government's contracting efforts for preparedness, response,
and recovery efforts related to the 2017 hurricanes and
California wildfires.\10\ In its review, GAO found that in
response to Hurricanes Harvey, Irma, and Maria, as well as the
2017 California wildfires, FEMA and the U.S. Army Corps of
Engineers (USACE) relied heavily on advance contracts,
obligating approximately $4.5 billion for goods and services as
of May 31, 2018.\11\ Despite FEMA and USACE's extensive use of
advance contracts, GAO identified several challenges,
including, but not limited to, inconsistencies in Federal
coordination with states and localities on their use--a
requirement from PKEMRA. As GAO stated, ``without consistent
information and coordination with FEMA, states and localities
may not have the tools needed to establish their own advance
contracts for critical goods and services and quickly respond
to future disasters.''\12\
---------------------------------------------------------------------------
\10\U.S. Gov't Accountability Office, GAO-19-93, 2017 Disaster
Contracting: Action Needed to Better Ensure More Effective Use and
Management of Advance Contracts (2019), available at https://
www.gao.gov/assets/700/695829.pdf.
\11\Id.
\12\Id.
---------------------------------------------------------------------------
Concluding their review, GAO made nine recommendations to
FEMA. Among others, those recommendations would require FEMA
to:
Update its strategy and guidance to clarify the use
of advance contracts, improve the timelines of its
acquisition planning activities, revise its methodology
for reporting disaster contracting actions to
congressional committees, and provide more consistent
guidance and information to contracting officers to
coordinate with and encourage states and localities to
establish advance contracts.\13\
---------------------------------------------------------------------------
\13\Id.
After reviewing GAO's report and the accompanying
recommendations, FEMA concurred with all nine
recommendations.\14\ S. 979 codifies those recommendations to
ensure that FEMA is more effectively using and managing its
advance contracts process while also coordinating with states
and localities to ensure they are well-prepared and equipped
for future disasters.\15\
---------------------------------------------------------------------------
\14\Id.
\15\Press Release, Senator Marco Rubio, The Federal Advance
Contracts Enhancement (FACE) Act (2019), available at https://
www.rubio.senate.gov/public/_cache/files/3c25affe-baa4-43bb-9b3d-
21f7c7aef40a/949D2085980D52AF552926AEDA958DBF.rubio---the-face-act-one-
pager.pdf.
---------------------------------------------------------------------------
III. Legislative History
Senator Marco Rubio (R-FL) introduced S. 979, the Federal
Advance Contracts Enhancement Act, on April 2, 2019, with
Committee Chairman Ron Johnson (R-WI) and Ranking Member Gary
Peters (D-MI). The bill was referred to the Committee on the
Homeland Security and Governmental Affairs.
The Committee considered S. 979 at a business meeting on
June 19, 2019. Senator Peters offered an amendment that
requires FEMA to report within 180 days how the agency can
maximize the award of advance contracts to small businesses.
The Committee ordered the bill, as amended by the Peters
Amendment, reported favorably by voice vote en bloc. Senators
present for the vote were: Johnson, Portman, Paul, Lankford,
Romney, Scott, Enzi, Hawley, Peters, Carper, Hassan, Sinema,
and Rosen.
IV. Section-by-Section Analysis of the Bill, as Reported
Section 1. Short title
This section established that the Bill may be cited as the
``Federal Advance Contracts Enhancement Act'' or the ``FACE
Act.''
Section 2. Findings
This section makes a number of findings. First it clarifies
that, according to PKEMRA, FEMA is required to establish
advance contracts. It defines advance contracts as contracts
that are established prior to disasters and are typically
needed to provide life-sustaining goods and services in the
immediate aftermath of a disaster. It also finds that the
hurricanes and wildfires in 2017 highlighted the importance of
advance contracts, cites GAO's report that identified advance
contract challenges in the review of the 2017 disaster season,
and states the intent of Congress to amend PKEMRA to implement
GAO's recommendations.
Section 3. Federal emergency management agency advance contracts
Subsection (a) amends Section 691 of PKEMRA to add a new
section (e), which requires that the Administrator of FEMA
report to the appropriate committees of Congress on FEMA's
reporting methodology, disaster contract spending, a strategy
that defines the objective of advance contracts, how advance
contracts contribute to disaster response operations, how to
maximize the award of advanced contracts to small businesses,
and whether and how advance contracts should be prioritized in
relation to post-disaster contracts.
It also adds a new section (f), which requires the
Administrator of FEMA within 270 days to ensure the head of
contracting activity updates the Disaster Contracting Desk
Guide to provide guidance on instances where contracting
officers should use advance contracts over post-disaster
contracts, for contract officers to work with state and local
governments to ensure sound advance contracts are in place at
their respective levels, to adhere to hard copy contract file
management requirements, that contracting officers be notified
of the three-day time frame requirements for entering completed
award documentation, to revise the reporting methodology to
ensure all disaster contracts are entered into quarterly
reports, to identify a single centralized resource that all
advance contracts be entered into, and communicates complete
and up-to-date information that is available to state and local
governments to inform their advance contracting efforts.
The Administrator of FEMA is also required within 180 days
to update and implement guidance to identify acquisition
planning time frames, to clearly communicate the purpose and
use of a master acquisition planning schedule, and to report
regularly to the appropriate committees of Congress on their
efforts to implement the GAO recommendations.
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 Estimate
U.S. Congress,
Congressional Budget Office,
Washington, DC, July 18, 2019.
Hon. Ron Johnson,
Chairman, Committee on Homeland Security and Governmental Affairs, U.S.
Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 979, the Federal
Advance Contracts Enhancement Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Jon Sperl.
Sincerely,
Phillip L. Swagel,
Director.
Enclosure.
Under the Post-Katrina Emergency Management Reform Act of
2006, the Federal Emergency Management Agency (FEMA) was
required to provide a report to the Congress identifying goods
and services that the agency is capable of contracting for in
advance of disasters, as well as a strategy outlining how the
agency could use advance contracts in a practical and cost-
effective manner.
S. 979 would require FEMA, within 6 months of enactment, to
provide an updated report and strategy to the Congress that
includes new information about how advance contracts can be
better employed by the agency. The bill also would require FEMA
to undertake a variety of actions with respect to contracts
including communicating complete and up-to-date information on
available advance contracts to state and local governments.
FEMA's Office of Chief Procurement Officer employs 54 staff
focused on implementing advance contracts and is currently
performing all of the activities required by S. 979, with the
exception of communicating with state and local governments.
Using information from FEMA, CBO estimates that the agency
would need about $150,000 to develop a strategy for
communicating information to state and local governments and
would complete the strategy in 2020. After that, CBO expects
the agency would start conducting two briefings each year with
state and local officials. CBO estimates the agency would
require the equivalent of 3 full-time employees for those
briefings, at an annual cost of about $400,000. In total, CBO
estimates that the briefings would cost $2 million over the
2020-2024 period; any spending would be subject to the
availability of appropriated funds.
The CBO staff contact for this estimate is Jon Sperl. The
estimate was reviewed by H. Samuel Papenfuss, Deputy Assistant
Director for Budget Analysis.
VII. Changes in Existing Law Made by the Bill, as Reported
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
the bill, as reported, are shown as follows: (existing law
proposed to be omitted is enclosed in brackets, new matter is
printed in italic, and existing law in which no change is
proposed is shown in roman:
UNITED STATES CODE
* * * * * * *
TITLE 6--DOMESTIC SECURITY
* * * * * * *
CHAPTER 2--NATIONAL EMERGENCY MANAGEMENT
* * * * * * *
Subchapter II--Comprehensive Preparedness System
* * * * * * *
PART D--PREVENTION OF FRAUD, WASTE, AND ABUSE
* * * * * * *
SEC. 791. ADVANCE CONTRACTING
* * * * * * *
(e) Updated Report.--Not later than 180 days after the date
of enactment of this subsection, the Administrator shall submit
to the appropriate committee of Congress an undated report that
contains--
(1) the information required in the initial report
under subparagraphs (A) and (B) of subsection (a)(1);
and
(2) an updated strategy described in subsection
(a)(1)(C) that clearly defines--
(A) the objectives of advance contracts;
(B) how advance contracts contribute to
disaster response operations of the Agency;
(C) how to maximize the award of advance
contracts to small business concerns, as
defined in section 3 of the Small Business Act
(15 U.S.C. 632); and
(D) whether and how advance contracts should
be prioritized in relation to new post-disaster
contract awards.
(f) Additional Duties of the Administrator.--
(1) Head of contracting.--The Administrator shall
ensure that the head of contracting activity of the
agency--
(A) not later than 270 days after the date of
enactment of this subsection, updates the
Disaster Contracting Desk Guide of the Agency
to provide specific guidance--
(i) on whether and under what
circumstances contracting officers
should consider using existing advance
contracts entered into in according
with this section prior to making new
post disaster contract awards, and
include this guidance in existing semi-
annual training given to contracting
officers; and
(ii) for contracting officers to
perform outreach and to State and local
government on the potential benefits of
establishing their own pre-negotiated
advance contracts;
(B) adheres to hard copy contract file
management requirements in effect to ensure
that the files relating to advance contracts
entered into in accordance with this section
are complete and up to date, whether the files
will be transferred into the Electronic
Contracting Filing System of the Agency or
remain in hard copy format;
(C) notifies contracting officers of the 3-
day time frame requirement for entering
completed award documentation into the contract
writing system of the Agency when executing
notice to proceed documentation;
(D) not later than 180 days after the date of
enactment of this subsection, revises the
reporting methodology of the Agency to ensure
that all disaster contracts are included in
each quarterly report submitted to the
appropriate congressional committees under this
section on disaster contract actions;
(E) identifies a single centralized resource
listing advance contracts entered into under
this section and ensures that source is current
and up to date and includes all available
advance contracts; and
(F) communicates compete and up-to-date
information on available advance contracts to
State and local government to inform their
advance contracting efforts.
(2) Master acquisition planning schedule.--Not later
than 180 days after the date of enactment of this
subsection, the Administrator shall update and
implement guidance for program office and acquisition
personal of the Agency to--
(A) identify acquisition planning time frames
and considerations across the entire
acquisition planning process of the Agency; and
(B) clearly communicate the purpose and use
of a master acquisition planning schedule.
