To require that the Federal Government procure from the private sector the goods and services necessary for the operations and management of certain Government agencies, and for other purposes.

Summary: Freedom from Government Competition Act of 2009 - Requires each executive or military department or independent establishment to obtain all goods and services necessary for or beneficial to the accomplishment of its authorized functions by procurement from private sources, except if: (1) such goods or services are required by law to be produced or performed by such agency; or (2) the head of the agency determines and certifies that federal production or performance is necessary for the national defense or homeland security, that a good or service is so inherently governmental in nature that it is in the public interest to require production or performance by government employees, or that there is no private source capable of providing the good or service.

Requires such private sector provision of goods and services to be performed through: (1) the divestiture of federal involvement; (2) the award of a contract using competitive procedures; (3) converting an activity to performance by a qualified firm under at least 51% ownership by an Indian tribe or a Native Hawaiian Organization; or (4) conducting a public-private competitive sourcing analysis in accordance with Office of Management and Budget (OMB) procedures and determining that using the private sector is in the best interest of the United States and provides the best value to the taxpayer.

Authorizes an agency head to utilize federal employees to provide goods or services previously provided by a private sector entity upon completion of a public-private competitive sourcing analysis and after determining that provision by federal employees provides the best value.

Requires the Director to carry out a study, in conjunction with the Comptroller General, to evaluate the activities carried out in each agency.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Freedom from Government Competition 
Act of 2009''.

SEC. 2. FINDINGS.

    Congress makes the following findings:
            (1) Private sector business concerns, which are free to 
        respond to the private or public demands of the marketplace, 
        constitute the strength of the United States economic system.
            (2) Competitive private enterprises are the most 
        productive, efficient, and effective sources of goods and 
        services.
            (3) Unfair Government competition with the private sector 
        of the economy is detrimental to the United States economic 
        system.
            (4) Unfair Government competition with the private sector 
        of the economy is at an unacceptably high level, both in scope 
        and in dollar volume.
            (5) Current law and policy have failed to address 
        adequately the problem of unfair Government competition with 
        the private sector of the economy.
            (6) It is in the public interest that the Federal 
        Government establish a consistent policy to rely on the private 
        sector of the economy to provide goods and services necessary 
        for or beneficial to the operation and management of Federal 
        agencies and to avoid unfair Government competition with the 
        private sector of the economy.

SEC. 3. DEFINITIONS.

    In this Act, the term ``agency'' means--
            (1) an executive department as defined by section 101 of 
        title 5, United States Code;
            (2) a military department as defined by section 102 of such 
        title; and
            (3) an independent establishment as defined by section 
        104(l) of such title.

SEC. 4. PROCUREMENT FROM PRIVATE SOURCES.

    (a) Policy.--In the process of governing, the Federal Government 
should not compete with its citizens. The competitive enterprise 
system, characterized by individual freedom and initiative, is the 
primary source of national economic strength. In recognition of this 
principle, it has been and continues to be the general policy of the 
Federal Government--
            (1) to rely on commercial sources to supply the products 
        and services the Government needs;
            (2) to refrain from providing a product or service if the 
        product or service can be procured more economically from a 
        commercial source; and
            (3) to utilize Federal employees to perform inherently 
        governmental functions (as that term is defined in section 5 of 
        the Federal Activities Inventory Reform Act of 1998 (Public Law 
        105-270; 112 Stat. 2384)).
    (b) General Rule.--Except as provided in subsection (c) and 
notwithstanding any other provision of law, each agency shall obtain 
all goods and services necessary for or beneficial to the 
accomplishment of its authorized functions by procurement from private 
sources.
    (c) Exemptions.--Subsection (b) shall not apply to an agency with 
respect to goods or services if--
            (1) the goods or services are required by law to be 
        produced or performed, respectively, by the agency; or
            (2) the head of the agency determines and certifies to 
        Congress in accordance with regulations promulgated by the 
        Director of the Office of Management and Budget that--
                    (A) Federal Government production, manufacture, or 
                provision of a good or service is necessary for the 
                national defense or homeland security;
                    (B) a good or service is so inherently governmental 
                in nature that it is in the public interest to require 
                production or performance, respectively, by Government 
                employees; or
                    (C) there is no private source capable of providing 
                the good or service.
    (d) Method of Procurement.--The provision of goods and services not 
exempt by subsection (c)(1) or (c)(2) shall be performed by an entity 
in the private sector through--
            (1) the divestiture of Federal involvement in the provision 
        of a good or service;
            (2) the award of a contract to an entity in the private 
        sector, using competitive procedures, as defined in section 309 
        of the Federal Property and Administrative Services Act of 1949 
        (41 U.S.C. 259) and section 2302 of title 10, United States 
        Code;
            (3) converting an activity to performance by a qualified 
        firm under at least 51 percent ownership by an Indian tribe, as 
        defined in section 4(e) of the Indian Self-Determination and 
        Education Assistance Act (25 U.S.C. 450b(e)), or a Native 
        Hawaiian Organization, as defined in section 8(a)(15) of the 
        Small Business Act (15 U.S.C. 637(a)(15)); or
            (4) conducting a public-private competitive sourcing 
        analysis in accordance with the procedures established by the 
        Office of Management and Budget and determining that using the 
        assets, facilities, and performance of the private sector is in 
        the best interest of the United States and that production or 
        performance, respectively, by the private sector provides the 
        best value to the taxpayer.
    (e) Contracted Activities.--The head of an agency may utilize 
Federal employees to provide goods or services previously provided by 
an entity in the private sector upon completion of a public-private 
competitive sourcing analysis described in subsection (d)(4), and after 
making a determination that the provision of such goods or services by 
Federal employees provides the best value to the taxpayer.
    (f) Regulations.--The Director of the Office of Management and 
Budget shall promulgate such regulations as the Director considers 
necessary to carry out this section. In promulgating such regulations, 
the Director shall assure that any State or territory, or political 
subdivision of a State or territory, complies with the policy and 
implements the requirements of this section when expending Federal 
funds.

SEC. 5. STUDY AND REPORT.

    The Director of the Office of Management and Budget, in conjunction 
with the Comptroller General of the United States, shall carry out a 
study to evaluate the activities carried out in each agency, including 
those identified as commercial and inherently governmental in nature in 
the inventory prepared pursuant to the Federal Activities Inventory 
Reform Act (Public Law 105-270; 31 U.S.C. 501 note) and shall transmit 
a report to the Congress prior to June 30 of each year. The report 
shall include--
            (1) an evaluation of the justification for exempting 
        activities pursuant to section 4(c); and
            (2) a schedule for the transfer of commercial activities to 
        the private sector, pursuant to section 4(d), to be completed 
        within 5 years after the date on which such report is 
        transmitted to the Congress.