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[Senate Report 112-16]
[From the U.S. Government Publishing Office]

                                                        Calendar No. 41

112th Congress  }                                             {  Report
  1st Session   }             SENATE                          {  112-16
_______________________________________________________________________
 
    INDEPENDENT TASK AND DELIVERY ORDER REVIEW EXTENSION ACT OF 2011 

                               __________

                              R E P O R T

                                 of the

                   COMMITTEE ON HOMELAND SECURITY AND

                          GOVERNMENTAL AFFAIRS

                          UNITED STATES SENATE

                              to accompany

                                 S. 498

  TO ENSURE OBJECTIVE, INDEPENDENT REVIEW OF TASK AND DELIVERY ORDERS

                 [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                  May 9, 2011.--Ordered to be printed

                               ----------
                         U.S. GOVERNMENT PRINTING OFFICE 

99-010 PDF                       WASHINGTON : 2011 

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Washington, DC 20402-0001 

        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

               JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan                 SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii              TOM COBURN, Oklahoma
THOMAS R. CARPER, Delaware           SCOTT P. BROWN, Massachusetts
MARK L. PRYOR, Arkansas              JOHN McCAIN, Arizona
MARY L. LANDRIEU, Louisiana          RON JOHNSON, Wisconsin
CLAIRE McCASKILL, Missouri           ROB PORTMAN, Ohio
JON TESTER, Montana                  RAND PAUL, Kentucky
MARK BEGICH, Alaska

                  Michael L. Alexander, Staff Director
       Beth M. Grossman, Deputy Staff Director and Chief Counsel
                     Troy H. Cribb, Senior Counsel
               Carly A. Steier, Professional Staff Member
               Nicholas A. Rossi, Minority Staff Director
              Molly A. Wilkinson, Minority General Counsel
                  Anne F. Terry, Minority DHS Detailee
                  Trina Driessnack Tyrer, Chief Clerk

                                                        Calendar No. 41

112th Congress  }                                             {  Report
  1st Session   }                  SENATE                     {  112-16

=======================================================================

    INDEPENDENT TASK AND DELIVERY ORDER REVIEW EXTENSION ACT OF 2011 

                                _______
                                

                  May 9, 2011.--Ordered to be printed

                                _______
                                

Mr. Lieberman, from the Committee on Homeland Security and Governmental 
                    Affairs, submitted the following

                              R E P O R T

                         [To accompany S. 498]

    The Committee on Homeland Security and Governmental 
Affairs, to which was referred the bill (S. 498) to ensure 
objective, independent review of task and delivery orders, 
having considered the same, reports favorably thereon with an 
amendment and recommends that the bill, as amended, do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and Summary..............................................1
 II. Background and Need for the Legislation..........................1
III. Legislative History..............................................4
 IV. Section by Section Analysis......................................4
  V. Evaluation of Regulatory Impact..................................5
 VI. Congressional Budget Office Cost Estimate........................5
VII. Changes in Existing Law Made by the Bill, as Reported............6

                         I. Purpose and Summary

    S. 498, the Independent Task and Delivery Order Review 
Extension Act of 2011, extends through September 30, 2016 the 
authority of the Government Accountability Office (GAO) to hear 
protests of certain task and delivery orders--federal agency 
purchases made under umbrella contracts. Specifically, the bill 
extends the authority to hear protests of task and delivery 
orders in excess of $10 million awarded under Federal civilian 
agency contracts.

              II. Background and Need for the Legislation

    For more than 80 years, GAO has provided an objective, 
independent and impartial forum for the resolution of disputes 
concerning the award of Federal contracts. Through what is 
known as the bid protest process, an interested party may ask 
GAO to review whether a contract has been, or is about to be, 
awarded improperly or illegally. GAO issues bid protest 
decisions not later than 100 days from the date the protest is 
filed, providing a quick adjudicative process that ensures that 
Federal contracts are awarded fairly and in compliance with 
applicable statutes and regulations.\1\
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    \1\The bid protest authority is codified at 31 U.S.C. 
Sec. Sec. 3551 et seq.
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    In 1994, Congress passed the Federal Acquisition 
Streamlining Act (FASA) to provide greater flexibilities to 
agencies in their purchases of goods and services.\2\ FASA laid 
out specific procedures for the use of indefinite-delivery, 
indefinite-quantity (IDIQ) contracts, which allow agencies to 
negotiate contracts with broad statements of work and then 
procure goods and services through specific task and delivery 
orders as needs arise. FASA, though, limited GAO's jurisdiction 
over protests of task and delivery orders to cases in which the 
protest alleged that the order increased the scope, period or 
maximum value of the contract under which the order was 
issued.\3\ Prior to FASA, GAO heard protests concerning task 
and delivery orders that were competed among multiple vendors 
holding contracts, regardless of value.\4\
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    \2\Pub. L. No. 103-355.
    \3\Section 1004 of FASA prescribed procedures for task and delivery 
order contracts of the Department of Defense; section 1054 prescribed 
those procedures for civilian agency contracts.
    \4\E.g., GAO docket numbers B-254428, B-227340. In contrast, GAO 
viewed a protest concerning the issuance of a task or delivery order 
under a single, stand-alone contract to be generally a matter of 
contract administration, unless the protester was contending that the 
task order was beyond the scope of the underlying contract, thus 
changing the nature of the original contract. E.g., GAO docket number 
B-262800.
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    In 2003, Congress created the Acquisition Advisory Panel 
(``Panel'') to review laws, regulations, and government-wide 
acquisition policies, and to make appropriate recommendations 
to improve, among other things, the effective, efficient and 
fair award of Federal contracts.\5\ The Panel issued its report 
in 2007.\6\ In the area of competition, the Panel found that 
IDIQ contracts provide significant benefits to the government, 
including reduced administrative costs for fulfilling recurring 
service needs. However, the Panel also found that agencies 
frequently use task and delivery orders to make significant 
purchases of complex services, and that the ordering process 
under task and delivery order contracts sometimes occurs 
without rigorous acquisition planning, adequate source 
selection, and meaningful competition. The Panel also heard 
evidence from GAO, Inspectors General and others concerning the 
improper use of IDIQ contracts.
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    \5\The Panel was authorized by Section 1423 of the Services 
Acquisition Reform Act of 2003, which was enacted as section 1423 of 
the National Defense Authorization Act for Fiscal Year 2004, Pub. L. 
No. 108-136.
    \6\Report of the Acquisition Advisory Panel to the Office of 
Federal Procurement Policy and the United States Congress (January 
2007) (``Report of the Panel'').
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    The Panel recommended that Congress expand GAO's 
jurisdiction to hear protests of task and delivery orders 
beyond those related to scope, period and maximum value. 
Specifically, the Panel wanted GAO to have authority to 
consider whether agencies followed applicable statutes and 
regulations, including relevant competition requirements, when 
awarding task and delivery orders over $5 million.\7\
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    \7\Report of the Panel, pp. 9-11, 36.
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    The Committee agreed with the Panel's assessment and 
recommendation and approved, as part of a larger acquisition 
reform bill, a provision authorizing the protest of task and 
delivery orders under both Department of Defense and civilian 
agency contracts.\8\ This provision, in amended form, was then 
enacted into law as part of the National Defense Authorization 
Act for Fiscal Year 2008.\9\ The authorization limited protests 
to task and delivery orders exceeding $10 million and included 
a three-year sunset, in order to allow Congress the opportunity 
to assess the impact of the protests on Federal procurement 
system before deciding whether to extend, or let expire, the 
authority.
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    \8\Section 203 of S. 680, 110th Congress, 1st Session, passed by 
the Senate on November 7, 2007. S. 680 set an initial threshold of $5 
million for the protest of task and delivery orders but also would have 
provided the Administrator for the Office of Federal Procurement 
Policy, upon finding that the threshold was unduly burdensome, the 
discretion to increase the threshold to an amount no higher than $25 
million.
    \9\Section 843, National Defense Authorization Act for Fiscal Year 
2008, Pub. L. No. 110-181.
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    After reviewing the implementation of these provisions over 
the past three years, the Committee has concluded that Congress 
should reauthorize GAO's expanded jurisdiction for another five 
years. An increasing amount of taxpayer money has gone to fund 
task and delivery orders. Such orders now commonly exceed $100 
million; indeed, GAO recently received protests of three task 
orders that each passed the $1 billion mark.\10\ Review of 
large task and delivery orders by GAO provides important 
oversight and discipline against abuse or other inappropriate 
use of IDIQ contracts, and the ability of interested parties to 
protest task and delivery orders promotes transparency, 
accountability, and competition in the expenditure of tax 
dollars through contracts.
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    \10\GAO docket numbers B-404263.6 (regarding a $2.6 billion task 
order awarded by the General Services Administration (GSA) for 
information technology support to the Department of Homeland Security 
for the St. Elizabeths campus); B-404671 (regarding a $1 billion task 
order awarded by the Department of the Army for the training of the 
Afghan National Police); and B-404682 (regarding a $2.5 billion task 
order awarded by the Department of State under GSA's Alliant contract 
for consolidation of the Department's information technology systems).
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    In considering the reauthorization of task and delivery 
order protests, the Committee has been sensitive to concerns 
that protests slow the procurement process, and can thereby 
burden agencies, contractors and taxpayers. The Committee must 
weigh this concern, however, against the benefits yielded by a 
process that ensures greater transparency, integrity and 
discipline in government contracting, and enforces the 
statutory requirements for competition.
    Just as importantly, data provided to the Committee by GAO 
show that GAO's expanded jurisdiction has not brought with it 
an unwieldy increase in protests. In Fiscal Year 2009, GAO 
reviewed 38 civilian agency task order protests, and in Fiscal 
Year 2010, it heard 65, representing challenges to far less 
than even one-tenth of one percent of all task and delivery 
orders awarded under civilian agency contracts. Moreover, even 
with GAO's expanded jurisdiction to hear protests of task and 
delivery orders, the total number of protests filed at GAO in 
Fiscal Years 2009 and 2010, while higher than recent years, 
remains well below the number filed annually in the late 1980's 
and early 1990's. This is true despite the substantial increase 
in dollars expended by the U.S. government on contracts over 
the past decade, from $222 billion in Fiscal Year 2001 to $536 
billion in Fiscal Year 2010.
    In considering GAO's experience with protests of task and 
delivery orders thus far, the Committee concludes that 
extension of the authority is in the best interest of the U.S. 
government, contractors, and taxpayers. Section 825 of the Ike 
Skelton National Defense Authorization Act for Fiscal Year 
2011,\11\ signed into law on January 7, 2011, has already 
extended the task and delivery order protest authority for 
Department of Defense contracts through September 30, 2016. S. 
498 will align the authority for civilian contracts to the 
authority for defense contracts. The new sunset date will again 
provide Congress the opportunity to assess the effectiveness of 
the protest authority in five years.
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    \11\Pub. L. No. 111-383.
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                        III. Legislative History

    On March 7, 2011, Senators Lieberman, Collins, McCaskill 
and Portman introduced S. 498, which was referred to the Senate 
Committee on Homeland Security and Governmental Affairs. The 
Committee considered the bill on April 13, 2011. The Committee 
adopted by voice vote an amendment offered by Senator Collins 
and then ordered the bill favorably reported, also by voice 
vote. Members present for both votes were Chairman Lieberman 
and Senators Levin, Akaka, Carper, Begich, Collins, Coburn, 
McCain, and Johnson.
    The amendment offered by Senator Collins makes clear that 
the bill does not authorize appropriations for the specific 
purpose of processing protests of task and delivery orders, and 
that such protests shall be processed using existing resources 
of GAO and Federal agencies. The Committee finds that GAO and 
agencies have been able to absorb the costs of processing and 
responding to task and delivery order protests into their 
existing budgets, and therefore specific authorization and 
appropriation of funds for this activity are unnecessary.

               IV. Section-by-Section Summary of the Bill

Section 1. Short title

    The short title of the bill is the ``Independent Task and 
Delivery Order Review Extension Act of 2011.''

Section 2. Extension of sunset date for certain protests of task and 
        delivery order contracts

    This section extends the jurisdiction of GAO to hear 
protests of civilian task and delivery order contracts in 
excess of $10 million through September 30, 2016, allowing 
interested parties to seek GAO's review of whether a task order 
was awarded in accordance with applicable laws and regulations. 
The extension of jurisdictional authority also allows protests 
of task and delivery orders of any amount on the ground that 
the order increases the scope, period, or maximum value of the 
contract under which the order was issued.

Section 3. Use of existing resources to process task and delivery order 
        protests

    This section states that no amounts are authorized to be 
appropriated for the specific purpose of processing protests of 
task and delivery orders and that all such protests shall be 
processed using the existing resources of the Government 
Accountability Office and executive agencies.

                  V. Regulatory Impact and Evaluation

    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 the bill. The Congressional 
Budget Office states that the bill contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandate Reform Act and would not affect the budgets of 
State, local, or tribal governments. The enactment of this 
legislation will not have significant regulatory impact.

             VI. Congressional Budget Office Cost Estimate

                                                    April 19, 2011.
Hon. Joseph I. Lieberman,
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. 498, the Independent 
Task and Delivery Order Review Extension Act of 2011.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Matthew 
Pickford.
    Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

S. 498--Independent Task and Delivery Order Review Extension Act of 
        2011

    S. 498 would amend federal law to extend the process for 
protesting the awards of certain civilian agency procurements. 
Under the legislation, contractors could protest certain task 
and delivery order contracts through September 30, 2016. In 
addition, the legislation would provide that no funds are 
authorized to be appropriated for processing protests made 
under the bill.
    Task and delivery order contracts authorize deliveries 
during the life of the contract without specifying a firm 
quantity of supplies or services. Such contracts are often used 
when an agency cannot determine the precise number of supplies 
or services that will be required. Under current law, 
contractors under such orders can protest the award of any 
order valued over $10 million, and the Government 
Accountability Office (GAO) has exclusive jurisdiction to hear 
those protests through May 2011. S. 498 would extend those 
procedures through September 2016.
    Information from GAO and several civilian agencies 
indicates that more than 100 cases have been filed to protest 
contract awards during the past two years; 50 percent of the 
protestors have reported obtaining some form of relief from the 
procuring agency. The form of relief can vary from improvements 
in the procurement process to reimbursement of the protestors' 
costs. Based on that information, CBO expects that complying 
with the bill would increase the administrative expenses of 
federal agencies for contract personnel, lawyers, and general 
administrative overhead. Such expenses would generally be paid 
from agencies' salaries and expense budgets, which are subject 
to annual appropriation. CBO estimates that such costs would 
total a few million dollars over the 2011-2016 period.
    Enacting S. 498 also could affect direct spending by 
agencies not funded through annual appropriations, such as the 
Tennessee Valley Authority and the Bonneville Power 
Administration; therefore, pay-as-you-go procedures apply. CBO 
estimates, however, that any net increase in spending by those 
agencies would not be significant. Enacting S. 498 would not 
affect revenues.
    S. 498 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would not affect the budgets of state, local, or tribal 
governments.
    On March 16, 2011, CBO transmitted a cost estimate for H.R. 
899, a bill to amend title 41, United States Code, to extend 
the sunset date for certain protests of task and delivery order 
contracts. The two pieces of legislation are similar, and CBO's 
estimate of their costs is the same.
    The CBO staff contact for this estimate is Matthew 
Pickford. The estimate was approved by Peter H. Fontaine, 
Assistant Director for Budget Analysis.

                      VII. Changes in Existing Law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, the following changes in existing 
law made by the bill, as reported, are shown as follows 
(existing law proposed to be omitted is enclosed in black 
brackets, new matter is printed in italic, existing law in 
which no change is proposed is shown in roman).

                               Title 41.

SECTION 4106.

           *       *       *       *       *       *       *

    (f) Protests.--
          (1) Protest not authorized.--A protest is not 
        authorized in connection with the issuance or proposed 
        issuance of a task or delivery order except for--
                  (A) a protest on the ground that the order 
                increases the scope, period, or maximum value 
                of the contract under which the order is 
                issued; or
                  (B) a protest of an order valued in excess of 
                $10,000,000.
          (2) Jurisdiction over protests.--Notwithstanding 
        section 3556 of title 31, the Comptroller General shall 
        have exclusive jurisdiction of a protest authorized 
        under (1)(B).
          (3) Effective period.--[This subsection shall be in 
        effect for three years, beginning on the date that is 
        120 days after January 28, 2008] Paragraph (1)(B) and 
        paragraph (2) of this subsection shall not be in effect 
        after September 30, 2016.

                                  
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