JULY 18, 2000

(Washington, DC) – Senate Governmental Affairs Committee Chairman Fred Thompson (R-TN) and ranking Democrat Joseph Lieberman (D-CT) said Senate approval of language in the Fiscal Year 2001 Defense Authorization Act to simplify rules used for federal government purchases from private industry would benefit not only the Department of Defense, but other agencies across the federal government as well.

The Senators noted that each year the federal government spends about $200 billion on goods and services, ranging from weapons systems to computer systems to everyday items. In the last six years, Congress has streamlined much of the red tape involved with the federal purchasing system, but there is more to be done.

"Our language continues past efforts to streamline complex government rules and regulations to make it easier for businesses to sell things to the federal government," said Thompson. "But to make sure taxpayer dollars are protected, it does so in a way that carefully balances affordability, accountability, and accessibility."

"What we are doing with this amendment is continuing to bring our procurement process into the 21^st century by applying tried and true private sector practices to the government’s purchase of goods and services," Senator Lieberman said. "The ultimate goal is to stretch precious taxpayer dollars by demanding high performance and innovative solutions from the procurement process."

The legislation includes five provisions which simplify the government purchasing process and enable private industry to better compete for government purchases. They include:

(1) Performance-Based Service Contracting – to establish a preference for performance-based contracts;

(2) Organization of the Cost Accounting Standards (CAS) Board – to establish the CAS Board as an independent board within the Office of Management and Budget to ensure that accounting standards receive appropriate attention of qualified accounting professionals;

(3) Solutions-Based Contracting Pilot Program – to permit flexibility on the use of solutions-based contracting;

(4) Appropriate Use of Personnel Experience and Educational Requirements in the Procurement of Information Technology Services – to eliminate mandatory minimum requirements included in information technology service contracts, and;

(5) Treatment of Partial Payments -- to ensure that the Prompt Pay Act applies to partial payments (made under service contracts) which are not paid timely.