II

106TH CONGRESS

1ST SESSION S. 1151

To amend the Office of Federal Procurement Policy Act to streamline the

application of cost accounting standards.

IN THE SENATE OF THE UNITED STATES

MAY 27, 1999

Mr. THOMPSON (for himself, Mr. LIEBERMAN, Mr. WARNER, and Mr. LEVIN)

introduced the following bill; which was read twice and referred to the

Committee on Governmental Affairs

A BILL

To amend the Office of Federal Procurement Policy Act

to streamline the application of cost accounting standards.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Cost Accounting

5 Standards Amendments of 1999’’.

6 SEC. 2. STREAMLINED APPLICABILITY OF COST ACCOUNT7 ING STANDARDS.

8 (a) APPLICABILITY.—Paragraph (2) of section 26(f)

9 of the Office of Federal Procurement Policy Act (41

10 U.S.C. 422(f)(2)) is amended—
2

•S 1151 IS

1 (1) by redesignating subparagraph (C) as sub2 paragraph (D);

3 (2) by striking subparagraph (B) and inserting

4 the following:

5 ‘‘(B) The cost accounting standards shall not apply

6 to a contractor or subcontractor for a fiscal year (or other

7 one-year period used for cost accounting by the contractor

8 or subcontractor) if the total value of all of the contracts

9 and subcontracts covered by the cost accounting standards

10 that were entered into by the contractor or subcontractor,

11 respectively, in the previous fiscal year (or other one-year

12 cost accounting period) was less than $50,000,000.

13 ‘‘(C) Subparagraph (A) does not apply to the fol14 lowing contracts or subcontracts for the purpose of deter15 mining whether the contractor or subcontractor is subject

16 to the cost accounting standards:

17 ‘‘(i) Contracts or subcontracts for the acquisi18 tion of commercial items.

19 ‘‘(ii) Contracts or subcontracts where the price

20 negotiated is based on prices set by law or regula21 tion.

22 ‘‘(iii) Firm, fixed-price contracts or sub23 contracts awarded on the basis of adequate price

24 competition without submission of certified cost or

25 pricing data.
3

•S 1151 IS

1 ‘‘(iv) Contracts or subcontracts with a value

2 that is less than $5,000,000.’’.

3 (b) WAIVER.—Such section is further amended by

4 adding at the end the following:

5 ‘‘(5)(A) The head of an executive agency may waive

6 the applicability of cost accounting standards for a con7 tract or subcontract with a value less than $10,000,000

8 if that official determines in writing that—

9 ‘‘(i) the contractor or subcontractor is primarily

10 engaged in the sale of commercial items; and

11 ‘‘(ii) the contractor or subcontractor would not

12 otherwise be subject to the cost accounting stand13 ards.

14 ‘‘(B) The head of an executive agency may also waive

15 the applicability of cost accounting standards for a con16 tract or subcontract under extraordinary circumstances

17 when necessary to meet the needs of the agency. A deter18 mination to waive the applicability of cost accounting

19 standards under this subparagraph shall be set forth in

20 writing and shall include a statement of the circumstances

21 justifying the waiver.

22 ‘‘(C) The head of an executive agency may not dele23 gate the authority under subparagraph (A) or (B) to any

24 official in the executive agency below the senior policy25 making level in the executive agency.
4

•S 1151 IS

1 ‘‘(D) The Federal Acquisition Regulation shall in2 clude the following:

3 ‘‘(i) Criteria for selecting an official to be dele4 gated authority to grant waivers under subpara5 graph (A) or (B).

6 ‘‘(ii) The specific circumstances under which

7 such a waiver may be granted.

8 ‘‘(E) The head of each executive agency shall report

9 the waivers granted under subparagraphs (A) and (B) for

10 that agency to the Board on an annual basis.’’.

11 (c) CONSTRUCTION REGARDING CERTAIN NOT-FOR12 PROFIT ENTITIES.—The amendments made by this sec13 tion shall not be construed as modifying or superseding,

14 nor as intended to impair or restrict, the applicability of

15 the cost accounting standards to—

16 (1) any educational institution or federally

17 funded research and development center that is as18 sociated with an educational institution in accord19 ance with Office of Management and Budget Cir20 cular A–21, as in effect on January 1, 1999; or

21 (2) any contract with a nonprofit entity that

22 provides research and development and related prod23 ucts or services to the Department of Defense.
5

•S 1151 IS

1 SEC. 3. EFFECTIVE DATE.

2 This Act and the amendments made by this Act shall

3 take effect 180 days after the date of enactment of this

4 Act.

Æ