Contractor Accountability
On April 23, 2008, the House passed three more key bills to hold federal contractors accountable and crack down on fraud and abuse. U.S. taxpayers are outraged at the massive levels of waste, fraud and abuse that have been documented in large government contracts to well-connected firms, such as the $45 billion in reconstruction contracts in Iraq.
These three bills are:
Contractors and Federal Responsibility Act, H.R. 3033, which creates a comprehensive, centralized database that lists civil, criminal and administrative proceedings concluded by federal and state governments against federal contractors.
Close the Contractor Fraud Loophole Act, H.R. 5712, which closes a loophole in a proposed rule so that mandatory fraud reporting requirements would apply to U.S. contractors working overseas as well as to contractors working here at home. This bill was signed into law on June 30, 2008, as part of the 2008 Supplemenatl Appropriations Act, H.R. 2642.
Government Contractor Accountability Act, H.R. 3928, which requires companies receiving 80% or more of their annual gross revenue from federal contracts to disclose the salaries of their most highly-compensated officers. This bill was signed into law on June 30, 2008, as part of the 2008 Supplemenatl Appropriations Act, H.R. 2642.
More on these three bills:
Contractors and Federal Spending Accountability Act - H.R. 3033
- This bill would create a comprehensive, centralized database that would more efficiently monitor the federal procurement process, account for the performance of federal contractors and grantees, and help protect U.S. taxpayer dollars.
- This database would list civil, criminal, and administrative proceedings concluded by federal and state governments against federal contractors and grantees.
- Currently, with no database, federal contractors or grantees that have repeatedly violated the law can still receive contracts and grants.
- Indeed, since 1995, the top 50 federal contractors have paid $12 billion in fines, penalties, restitution, and settlements for more than 350 instances of misconduct.
Close the Contractor Fraud Loophole Act - H.R. 5712
- A proposed change to the Federal Acquisition Regulations, published last November, exempted U.S. contractors working overseas – such as U.S. contractors working in Iraq -- from mandatory fraud reporting requirements that would apply to U.S. contractors working inside the United States.
- In light of the systemic waste, fraud and abuse documented in Iraq contracts, Rep. Peter Welch (D-VT) determined this loophole made no sense and introduced this bill to address the issue.
- The Administration has stated that this exemption for contractors working overseas from mandatory fraud reporting was a “bureaucratic mistake.”
- This bill closes this loophole. It requires mandatory fraud reporting for all U.S. contractors who have $5 million or greater in federal contracts – no matter where the work is done.
- Under the mandatory fraud reporting, all U.S. contractors would be required to report known instances of employees breaking federal criminal laws or receiving significant overcharges in relation to a federal contract.
Government Contractor Accountability Act - H.R. 3928
- This bill would require all companies that receive more than 80 percent of their annual gross revenue from federal funds to disclose the salaries of their most highly-compensated officers. (Publicly-traded companies and non-profits already disclose this information.)
- For example, currently, the management practices, financial statements, and employment policies of Blackwater, a privately-held company, which receives nearly all of its revenue from U.S. taxpayers, are tightly held secrets.
- Currently, as we spend billions on private U.S. contractors overseas, the U.S. taxpayer knows very little about privately-held companies reaping this windfall.
In addition, over the last year, the New Direction Congress has passed a series of other bills to better ensure the responsible use of U.S. taxpayer dollars, including the following:
- H.R. 1362, Accountability in Contracting Act, which cracks down on no-bid contracts and which the House passed by a vote of 347-73;
- H.R. 985, Whistleblower Protection Enhancement Act, which strengthens protections for federal whistleblowers who report waste, fraud and abuse and which the House passed by a vote of 331-94;
- H.R. 928, Improving Government Accountability Act, which enhances the effectiveness and independence of Inspectors General, who are the principal watchdogs of federal programs, and which the House passed by a vote of 404-11; and
- H.R. 4881, Contracting and Tax Accountability Act, which withholds most federal contracts from corporations that are delinquent on their federal taxes and which the House passed by voice vote.