I 

112TH CONGRESS 

1ST SESSION H. R. 1949 

To ensure efficient performance of agency functions. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 23, 2011 

Mr. SARBANES introduced the following bill; which was referred to the 

Committee on Oversight and Government Reform 

A BILL 

To ensure efficient performance of agency functions. 

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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Correction of Long-Standing Errors in Agencies’ 

6 Unsustainable Procurements Act of 2011’’ or the 

7 ‘‘CLEAN–UP Act’’. 

8 (b) TABLE OF CONTENTS.—The table of contents for 

9 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Definitions. 

Sec. 3. Findings. 

Sec. 4. Purposes. 

Sec. 5. General personnel policy. 


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Sec. 6. Consideration of in-house performance required for new work. 

Sec. 7. Transition to Federal employee performance of certain functions. 

Sec. 8. Establishment of inventories and reviews of contracts for services. 

Sec. 9. Identifying and addressing shortages of Federal employees. 

Sec. 10. Expedited hiring authority for performance of certain functions by 

Federal employees. 

Sec. 11. Establishment of business process reengineering projects as a preferred alternative to the OMB Circular A–76 process. 

Sec. 12. Reforms to the OMB Circular A–76 process. 

Sec. 13. Establishment of temporary suspension on use of OMB Circular A–76 

process until reforms required in this Act have been substantially implemented. 

1 SEC. 2. DEFINITIONS. 

2 In this Act: 

3 (1) INHERENTLY GOVERNMENTAL FUNC4 TIONS.—The term ‘‘inherently governmental func5 tions’’ has the meaning given the term under section 

6 5 of the Federal Activities Inventory Act of 1998 

7 (31 U.S.C. 1501 note) and subpart 7.5 of part 7 of 

8 the Federal Acquisition Regulation. 

9 (2) FUNCTIONS CLOSELY ASSOCIATED WITH IN10 HERENTLY GOVERNMENTAL FUNCTIONS.—The term 

11 ‘‘functions closely associated with inherently govern12 mental functions’’ means the functions described in 

13 section 7.503(d) of the Federal Acquisition Regula14 tion that are recurring. 

15 (3) MISSION-ESSENTIAL FUNCTIONS.—The 

16 term ‘‘mission-essential functions’’ refers to func17 tions that, although neither necessarily inherently 

18 governmental nor necessarily closely related to an in19 herently governmental function, are nevertheless 


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1 considered by executive agency officials to be more 

2 appropriate for performance by Federal employees. 

3 (4) BUSINESS PROCESS REENGINEERING

4 PROJECT.—The term ‘‘business process re5 engineering project’’ refers to a process whereby an 

6 existing organization is reinvented, consolidated, or 

7 expanded to result in a new organization whose per8 formance exceeds that of previous and comparable 

9 performers, whether performed by Federal employ10 ees or contractors or a combination of Federal em11 ployees and contractors. 

12 (5) EXECUTIVE AGENCY.—The term ‘‘executive 

13 agency’’ has the meaning given the term in section 

14 133 of title 41, United States Code. 

15 (6) PERSONAL SERVICES CONTRACT.—The 

16 term ‘‘personal services contract’’ has the meaning 

17 given to the term under section 37.104 of the Fed18 eral Acquisition Regulation, unless the functions to 

19 be performed under the contract are included in 

20 statutory exceptions, including sections 129b and 

21 1091 of title 10, United States Code. 

22 (7) STANDARD STUDY.—The term ‘‘standard 

23 study’’ has the meaning given to the specific type of 

24 cost-comparison study outlined in attachment B in 


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1 the OMB Circular A–76 process, as revised in May 

2 2003. 

3 SEC. 3. FINDINGS. 

4 Congress makes the following findings: 

5 (1) Functions that should have been performed 

6 by Federal employees because they are inherently 

7 governmental functions, functions that are closely 

8 related to inherently governmental functions and re9 curring, or mission-essential functions have been 

10 wrongly outsourced, including preparing budgets, de11 veloping policy, supporting acquisition, developing 

12 and interpreting regulations, developing reorganiza13 tions, and developing and implementing ‘‘competitive 

14 sourcing’’ plans. 

15 (2) Federal agencies have been pushed to 

16 outsource significant amounts of work with little 

17 competition, while Federal employees, despite having 

18 won 83 percent of the OMB Circular A–76 privat19 ization reviews conducted since the circular was re20 vised in 2003, are rarely given opportunities to per21 form new work or outsourced work. 

22 (3) The capacity of the Federal Government to 

23 oversee contractors and the OMB Circular A–76 pri24 vatization process continues to decline, as dem25 onstrated in scandals involving reconstruction efforts 


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1 in Iraq, Hurricane Katrina recovery efforts, and 

2 conditions at Walter Reed Army Medical Center. 

3 The Government Accountability Office (GAO), in 

4 two 2008 reports on the use of ‘‘competitive 

5 sourcing’’ in different agencies, determined that 

6 costs of A–76 privatization reviews often exceeded 

7 savings because of systematically bad direction from 

8 the Office of Management and Budget. In the latter 

9 report, on the Department of Labor, GAO wrote, 

10 ‘‘Without a better system to assess performance and 

11 track all of the costs associated with competitive 

12 sourcing, DoL cannot reliably assess whether com13 petitive sourcing truly provides the best deal for the 

14 taxpayers.’’. 

15 (4) The OMB Circular A–76 process retains 

16 fundamental inequities. The minimum cost differen17 tial fails to take into account the quantifiable costs 

18 (such as hiring consultants and diverting Federal 

19 employees from their regular duties) of carrying out 

20 A–76 privatization studies. All in-house bids are 

21 charged 12 percent of their personnel costs for over22 head costs, even though a Department of Defense 

23 Inspector General study revealed that overhead costs 

24 may not differ significantly, if at all, whether the 

25 functions are kept in-house or contracted out, even 


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1 in the case of studies of large numbers of Federal 

2 employees. Despite time limits established in law 

3 and as part of the OMB Circular process A–76 proc4 ess, privatization studies are allowed to continue in5 definitely. The longer an A–76 privatization study 

6 lasts, the more it costs to conduct, the less likely 

7 there are to be savings from that study, and the 

8 more likely it will cost taxpayers more than it will 

9 save. In fact, given the costs and controversies asso10 ciated with the OMB Circular A–76 privatization 

11 process, OMB should be encouraging agencies to use 

12 internal reengineering efforts, as OMB finally did, 

13 during the last year of George W. Bush’s presidency. 

14 SEC. 4. PURPOSES. 

15 The purposes of this Act are as follows: 

16 (1) To build upon the foundation established by 

17 the 110th Congress that suspended the use of the 

18 OMB Circular A–76 privatization process, required 

19 all executive agencies to develop policies to promote 

20 the insourcing of new work and outsourced work, 

21 and required the Department of Defense to develop 

22 a comprehensive inventory of its service contracts. 

23 (2) To establish a policy that provides that— 

24 (A) Federal employees must perform inher25 ently governmental functions, functions closely 


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1 related to inherently governmental functions, 

2 and mission essential functions; 

3 (B) other functions may be performed by 

4 Federal employees or contractors, depending on 

5 the needs of executive agencies and all relevant 

6 public-private competition requirements; and 

7 (C) Federal employees should not be sub8 ject to headcounts, personnel ceilings, or con9 straints, which force executive agencies to con10 tract out functions without public-private com11 petition. 

12 (3) To prevent executive agencies from con13 tracting out new functions if those new functions 

14 should be performed by Federal employees and re15 quire agencies to explain in annual reports to Con16 gress why functions ultimately contracted out were 

17 not considered for performance by Federal employ18 ees. 

19 (4) To require executive agencies— 

20 (A) to determine which of their functions 

21 must actually be performed by Federal employ22 ees because the work is inherently govern23 mental, closely related to inherently govern24 mental work, or mission essential, and how 


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1 many contractor employees are currently per2 forming those functions; 

3 (B) to report on how wrongly contracted 

4 out work will be insourced; and 

5 (C) to incrementally insource over several 

6 years 70 percent of the wrongly contracted out 

7 workload. 

8 (5) To require civilian agencies to establish in9 ventories to track the cost and quality, among other 

10 features, of specific contracts, based on the inven11 tory that the 110th Congress required the Depart12 ment of Defense to establish. 

13 (6) To require executive agencies to determine 

14 if they are now experiencing or will experience short15 ages of Federal employees and what their plans are 

16 for addressing these personnel shortfalls. 

17 (7) To encourage the use of a regulated alter18 native to the often costly and controversial OMB 

19 Circular A–76 process, including business process 

20 reengineering, which is commonly used by executive 

21 agencies to generate efficiencies through internal re22 organizations. 

23 (8) To direct the President to undertake several 

24 reforms of the OMB Circular A–76 privatization 

25 process, including imposing time limitations on how 


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1 long privatization studies can last, charging in-house 

2 bids only for actual overhead costs, and considering 

3 quantifiable costs of conducting A–76 privatization 

4 studies in the minimum differential. 

5 (9) To impose a temporary suspension on the 

6 use of the OMB Circular A–76 privatization process 

7 until the reforms required by this Act have been 

8 substantially implemented, consistent with the tem9 porary suspension on the same process enacted in 

10 the 110th Congress. 

11 SEC. 5. GENERAL PERSONNEL POLICY. 

12 (a) REQUIRED PERFORMANCE OF INHERENTLY GOV13 ERNMENTAL FUNCTIONS BY FEDERAL EMPLOYEES.— 

14 The head of each executive agency shall ensure that inher15 ently governmental functions, functions closely related to 

16 inherently governmental functions, and mission-essential 

17 functions are performed by Federal employees. 

18 (b) PERFORMANCE OF OTHER FUNCTIONS BY MORE

19 EFFICIENT WORKFORCE IN ACCORDANCE WITH PUBLIC20 PRIVATE COMPETITION REQUIREMENTS.—The head of 

21 each executive agency shall ensure that functions that are 

22 not inherently governmental functions, functions closely 

23 related to inherently governmental functions, or mission24 essential functions are performed by the more efficient 

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1 tors, or, in the case of the Department of Defense, mili2 tary personnel, consistent with requirements for quality 

3 and reliability and other needs of that executive agency 

4 and with all public-private competition requirements. 

5 (c) USE OF MOST EFFICIENT WORKFORCE.—Not6 withstanding any other provision of law, the heads of exec7 utive agencies shall not be constrained by any in-house 

8 personnel ceiling, headcount, or staffing limitation in en9 suring that functions are performed in the most efficient 

10 manner possible. 

11 (d) SHIFTING FUNCTIONS BETWEEN

12 WORKFORCES.—In developing personnel authorization re13 quests to Congress and in carrying out personnel policies 

14 generally, the head of each executive agency shall consider 

15 particularly the advantages of converting from one form 

16 of personnel (Federal or private contract personnel, or in 

17 the case of the Department of Defense, Federal, private 

18 contract, or military personnel) to another form of per19 sonnel for the performance of functions that are not inher20 ently governmental functions, functions closely related to 

21 inherently governmental functions, or mission-essential 

22 functions using any relevant public-private competition 

23 processes. 


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1 SEC. 6. CONSIDERATION OF IN-HOUSE PERFORMANCE RE2 QUIRED FOR NEW WORK. 

3 (a) FINDING.—Pursuant to section 739 of the Finan4 cial Services and General Government Appropriations Act, 

5 2008 (division D of Public Law 110–161; 31 U.S.C. 501 

6 note) each covered executive agency is required to devise 

7 and implement guidelines and procedures to ensure that 

8 consideration is given to using, on a regular basis, Federal 

9 employees to perform new functions. 

10 (b) CERTIFICATION REQUIRED BEFORE AWARDING

11 A SERVICE CONTRACT.—The Chief Acquisition Officer of 

12 each executive agency, or, if no such position exists, the 

13 executive agency’s representative on the Chief Acquisition 

14 Officers Council, shall, with respect to each service con15 tract entered into by such agency for the performance of 

16 a function or functions, including the award or placement 

17 of a task or delivery order or the exercise of an option 

18 under an existing contract, certify, together with sup19 porting rationales, that— 

20 (1) each function to be performed under such 

21 contract is not an inherently governmental function, 

22 a function closely related to an inherently govern23 mental function, or a mission-essential function; 

24 (2) the contract is not actually an unauthorized 

25 personal services contract; and 


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1 (3) performance by employees of the agency of 

2 the function to be performed by a contractor was ex3 plicitly considered, with particular consideration 

4 given if such function is comparable to functions al5 ready performed by Federal employees in the execu6 tive agency or another executive agency, either cur7 rently or within the last 10 years. 

8 (c) REPORTS REQUIRED.— 

9 (1) IN GENERAL.—Not later than November 1, 

10 2011, and annually thereafter, the head of each cov11 ered executive agency shall submit to the Director of 

12 the Office of Management and Budget a report on 

13 each of the service contracts for new work entered 

14 into during the previous fiscal year. 

15 (2) CONTENT.—Each report submitted under 

16 paragraph (1) shall describe the following: 

17 (A) Each function or functions performed 

18 under a contract with a contractor, the approxi19 mate number of employees used by contractors 

20 under each such contract, the date each such 

21 contract was entered into, the duration of each 

22 contract, and each certification required under 

23 subsection (b). 

24 (B) Each new function that was assigned 

25 by the executive agency to employees of the 


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1 agency, including, for each function, a brief de2 scription of the work, a determination of the 

3 dollar value, and the number of new Federal 

4 employees who were hired or transferred from 

5 the performance of other functions. 

6 (C) Any obstacles to assigning new func7 tions to Federal employees, as well as rec8 ommendations for legislation to overcome those 

9 obstacles. 

10 (d) PUBLICATION OF REPORTS REQUIRED.—The Di11 rector of the Office of Management and Budget shall 

12 promptly publish in the Federal Register information 

13 about obtaining each report prepared under subsection (c), 

14 including the names, addresses, and telephone numbers of 

15 the officials from whom the reports may be obtained. The 

16 reports shall also be made available on a publicly available 

17 Internet Web site. The Director shall remove proprietary 

18 and confidential information from reports made available 

19 pursuant to this section. 

20 SEC. 7. TRANSITION TO FEDERAL EMPLOYEE PERFORM21 ANCE OF CERTAIN FUNCTIONS. 

22 (a) REPORT ON FUNCTIONS THAT SHOULD BE PER23 FORMED BY FEDERAL EMPLOYEES.— 

24 (1) REPORT REQUIRED.—Not later than 180 

25 days after the date of the enactment of this Act, the 


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1 head of each executive agency shall submit to the 

2 Director of the Office of Management and Budget a 

3 report, to be known as the ‘‘Functions At Risk Re4 port’’, that— 

5 (A) describes any function that is, in whole 

6 or in part, an inherently governmental function, 

7 a function closely related to an inherently gov8 ernmental function, or a mission-essential func9 tion and which, despite the requirement that 

10 such function only be performed by Federal em11 ployees, is actually performed, in whole or in 

12 part, by a contractor (in this section referred to 

13 as an ‘‘at-risk function’’); 

14 (B) describes the number of contractor em15 ployees performing the function, in whole or in 

16 part, and the nature of their work; 

17 (C) includes a plan for ensuring that the 

18 function is performed by Federal employees; 

19 (D) identifies any impediments to carrying 

20 out such plan; and 

21 (E) includes any recommendations for ad22 ditional legislation necessary to implement this 

23 section. 

24 (2) LIMITATION ON DESIGNEE.—The head of 

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1 sibility for compliance with the report requirement 

2 established by this subsection below the level of an 

3 assistant secretary. 

4 (3) PUBLICATION OF REPORTS REQUIRED.— 

5 The Director of the Office of Management and 

6 Budget shall promptly publish in the Federal Reg7 ister information about obtaining each report pre8 pared under paragraph (1), including the names, ad9 dresses, and telephone numbers of the officials from 

10 whom the reports may be obtained. The reports shall 

11 also be made available on a publicly available Inter12 net Web site. The Director shall remove proprietary 

13 and confidential information from reports made 

14 available pursuant to this section. 

15 (b) REQUIREMENT TO REDUCE NUMBER OF AT16 RISK FUNCTIONS.—The head of each executive agency 

17 shall reduce the total number of contractor employees re18 ported in that executive agency’s Functions At Risk Re19 port by— 

20 (1) 5 percent within 1 year after the date of the 

21 enactment of this Act; 

22 (2) 10 percent within 2 years after the date of 

23 the enactment of this Act; 

24 (3) 20 percent within 3 years after the date of 

25 the enactment of this Act; 


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1 (4) 40 percent within 4 years after the date of 

2 the enactment of this Act; 

3 (5) 60 percent within 5 years after the date of 

4 the enactment of this Act; and 

5 (6) 70 percent within 6 years after the date of 

6 the enactment of this Act. 

7 (c) EVALUATION OF SCHEDULE.—The Comptroller 

8 General of the United States shall— 

9 (1) evaluate the success of the incremental 

10 schedule required under subsection (b) in ensuring 

11 that functions that should be performed by Federal 

12 employees are actually performed by Federal em13 ployees; and 

14 (2) provide recommendations for future legisla15 tion, particularly with respect to addresses remain16 ing at-risk functions. 

17 (d) SUSPENSION OF REDUCTION SCHEDULE RE18 QUIREMENT.—The Director of the Office of Management 

19 and Budget may suspend the requirement to reduce posi20 tions pursuant to subsection (b) for a particular executive 

21 agency for a specific period of time upon certifying to the 

22 Committee on Government Oversight and Reform of the 

23 House of Representatives and the Committee on Home24 land Security and Governmental Affairs of the Senate that 

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1 dermine national security, homeland security, or patient 

2 care. 

3 SEC. 8. ESTABLISHMENT OF INVENTORIES AND REVIEWS 

4 OF CONTRACTS FOR SERVICES. 

5 (a) IN GENERAL.—Not later than June 30, 2012, 

6 and annually thereafter, the head of each executive agency 

7 subject to the Federal Activities Inventory Reform Act of 

8 1998 (Public Law 105–270; 31 U.S.C. 1501 note), other 

9 than the Department of Defense, shall submit to the Di10 rector of the Office of Management and Budget an annual 

11 inventory of the activities performed during the preceding 

12 fiscal year pursuant to contracts for services for or on be13 half of such agency. 

14 (b) CONTENT.—The entry for an activity on an in15 ventory under this section shall include, for the fiscal year 

16 covered by such entry, the following: 

17 (1) The functions performed by the contractor. 

18 (2) Information regarding the contractor, the 

19 part of the executive agency administering the con20 tract, and the part of the agency whose require21 ments are being met through contractor performance 

22 of the function. 

23 (3) The funding source for the contract under 

24 which the function is performed. 


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1 (4) The fiscal year for which the activity first 

2 appeared on an inventory under this section. 

3 (5) The number of full-time contractor employ4 ees (or its equivalent) compensated for the perform5 ance of the activity. 

6 (6) Whether the contract has been performed 

7 pursuant to a contract awarded on a noncompetitive 

8 basis, either originally or upon a subsequent re9 newal. 

10 (7) Whether the contract has been performed 

11 poorly, as determined by a contracting officer, dur12 ing the 5-year period preceding the date of such de13 termination, because of excessive costs or inferior 

14 quality. 

15 (c) FORM.—The inventory required under this section 

16 shall be submitted in unclassified form, but may include 

17 a classified annex. 

18 (d) PUBLICATION.—The Director of the Office of 

19 Management and Budget shall promptly publish in the 

20 Federal Register information about obtaining each report 

21 prepared under subsection (a), including the names, ad22 dresses, and telephone numbers of the officials from whom 

23 the reports may be obtained. The reports shall be made 

24 available on a publicly available Internet Web site. The 


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1 Director shall remove proprietary information from re2 ports made available pursuant to this subsection. 

3 (e) REVIEW AND PLANNING REQUIREMENTS.—Not 

4 later than 90 days after the date on which an inventory 

5 is submitted under subsection (a), the head of each execu6 tive agency or an official designated personally by the 

7 agency head shall— 

8 (1) review the contracts and activities in the in9 ventory; 

10 (2) ensure that— 

11 (A) each contract on the list that is a per12 sonal services contract has been entered into, 

13 and is being performed, in accordance with ap14 plicable laws and regulations; 

15 (B) the activities on the list do not include 

16 any inherently governmental functions; and 

17 (C) to the maximum extent practicable, the 

18 activities on the list do not include any func19 tions closely associated with inherently govern20 mental functions; 

21 (3) identify activities that should be considered 

22 for conversion to performance by civilian employees 

23 of the executive agency pursuant to section 739 of 

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1 propriations Act, 2008 (division D of Public Law 

2 110–161; 31 U.S.C. 501 note); and 

3 (4) develop a plan to provide for appropriate 

4 consideration of the conversion by June 30 of the 

5 following year of the activities identified under para6 graph (3), which shall be included as an attachment 

7 to the next required annual inventory. 

8 (f) RULE OF CONSTRUCTION.—Nothing in this sec9 tion shall be construed to authorize the performance of 

10 personal services by a contractor except as otherwise pro11 vided by law. 

12 (g) PRIORITY OF CONTRACTOR INVENTORY.—Not13 withstanding any other provision of law, prior to the sub14 mission to the Office of Management and Budget of an 

15 inventory pursuant to the Federal Activities Inventory Re16 form Act of 1998 (Public Law 105–270; 31 U.S.C. 1501 

17 note), OMB Circular A–76, or any other related adminis18 trative regulation, directive, or policy, or to publication in 

19 the Federal Register, the head of an executive agency shall 

20 submit the inventory required under this section to Con21 gress and the Director of the Office of Management and 

22 Budget and shall publish the inventory required under this 

23 section in the Federal Register. 


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1 SEC. 9. IDENTIFYING AND ADDRESSING SHORTAGES OF 

2 FEDERAL EMPLOYEES. 

3 (a) ANNUAL STRATEGIC HUMAN CAPITAL PLAN RE4 QUIRED.—Not later than 1 year after the date of the en5 actment of this Act, and annually thereafter, the head of 

6 each executive agency shall submit to the Director of the 

7 Office of Management and Budget a strategic human cap8 ital plan to ensure the capability of the Federal employee 

9 workforce of the executive agency to perform its functions. 

10 (b) CONTENT.—Each strategic human capital plan 

11 submitted under subsection (a) shall include the following: 

12 (1) An assessment of— 

13 (A) the critical skills and competencies in 

14 the Federal employee workforce that will be 

15 needed to perform the executive agency’s func16 tions over the next 10 years, based on expected 

17 losses due to retirement and other attrition; and 

18 (B) gaps in the capability of the Federal 

19 employee workforce, both existing and pro20 jected, to perform the executive agency’s func21 tions over that period. 

22 (2) A plan of action for developing the Federal 

23 employee workforce of the executive agency to ad24 dress the current or anticipated gaps, including— 


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1 (A) specific hiring, promoting, and reten2 tion schedules, including the funding needed to 

3 achieve such schedules; and 

4 (B) specific strategies for developing, 

5 training, and promoting the Federal employee 

6 workforce of the executive agency, including the 

7 funding needed to implement such strategies. 

8 (c) ENHANCEMENT OF HUMAN CAPITAL PLAN9 NING.—All human capital planning efforts should be con10 sidered through any existing labor-management partner11 ship arrangements. 

12 (d) ADDRESSING GAPS IN FEDERAL

13 WORKFORCES.— 

14 (1) IN GENERAL.—The head of an executive 

15 agency may not conduct a public-private competition 

16 under Office of Management and Budget Circular 

17 A–76 or any other provision of law of any function 

18 that has been identified in the strategic human cap19 ital plan of such agency as one that either is experi20 encing or will experience a gap in its Federal em21 ployee workforce. 

22 (2) SHORTCOMINGS CONSTITUTING GAPS IN

23 WORKFORCE.—For purposes of this section, gaps in 

24 the workforce include shortcomings— 


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1 (A) in the skills and competencies of em2 ployees; 

3 (B) in the number of employees possessing 

4 such skills and competencies; and 

5 (C) in the skills and competencies of em6 ployees or in the number of employees that 

7 would make it difficult to effectively supervise a 

8 contractor and intelligently oversee its perform9 ance or reconstitute that function for perform10 ance within the agency in the event of con11 tractor nonperformance. 

12 (e) PUBLICATION.—The Director of the Office of 

13 Management and Budget shall promptly publish in the 

14 Federal Register information about obtaining each report 

15 prepared under subsection (a), including the names, ad16 dresses, and telephone numbers of the officials from whom 

17 the reports may be obtained. The reports shall be made 

18 available on a publicly available Internet Web site. 

19 SEC. 10. EXPEDITED HIRING AUTHORITY FOR PERFORM20 ANCE OF CERTAIN FUNCTIONS BY FEDERAL 

21 EMPLOYEES. 

22 (a) EXPEDITED HIRING AUTHORITY.—For purposes 

23 of sections 3304, 5333, and 5753 of title 5, United States 

24 Code, the head of an executive agency may— 


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1 (1) designate any category of professional posi2 tions within the agency as shortage category posi3 tions; and 

4 (2) utilize the authorities in such sections to re5 cruit and appoint highly qualified persons directly to 

6 positions so designated, 

7 in order to comply with the requirements of this Act, and 

8 section 739 of the Financial Services and General Govern9 ment Appropriations Act, 2008 (division D of Public Law 

10 110–161; 31 U.S.C. 501 note), which requires each cov11 ered executive agency to devise and implement guidelines 

12 and procedures to ensure that consideration is given to 

13 using, on a regular basis, Federal employees to perform 

14 new functions as well as functions that are currently per15 formed by contractors. 

16 (b) VETERANS PREFERENCE.—In using the author17 ity provided under this section, the head of an executive 

18 agency shall apply the principles of preference for the hir19 ing of veterans and other persons established in sub20 chapter 1 of chapter 33 of title 5, United States Code. 

21 (c) TERMINATION OF AUTHORITY.—Expedited hiring 

22 authority may not be used to appoint a person to a posi23 tion of employment under this section after the date that 

24 is 6 years after the date of the enactment of this Act. 


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1 (d) REPORT ON THE USE OF EXPEDITED HIRING

2 AUTHORITY.—Not later than December 31, 2011, and an3 nually thereafter for three years, the Office of Personnel 

4 Management shall submit to the Committee on Govern5 ment Oversight and Reform of the House of Representa6 tives and the Committee on Homeland Security and Gov7 ernmental Affairs of the Senate a report on the use by 

8 executive agencies of the expedited hiring authority under 

9 this section consistent with merit principles, including rec10 ommendations for how authority for expedited hiring 

11 might be improved. 

12 SEC. 11. ESTABLISHMENT OF BUSINESS PROCESS RE13 ENGINEERING PROJECTS AS A PREFERRED 

14 ALTERNATIVE TO THE OMB CIRCULAR A–76 

15 PROCESS. 

16 (a) STATEMENT OF POLICY.—Each executive agency 

17 should constantly strive to generate efficiencies and im18 provements through business process reengineering, even 

19 if such efforts reduce or increase the need for Federal em20 ployees and contractors. 

21 (b) GUIDELINES.—The Director of the Office of 

22 Management and Budget shall develop guidelines for the 

23 establishment of business process reengineering projects. 

24 Such guidelines shall ensure consideration and assessment 

25 of the following: 


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1 (1) The number of Federal employees and con2 tractor employees to be affected by the initiative, 

3 and how they will be affected. 

4 (2) The resources needed to conduct the initia5 tive. 

6 (3) The location or locations where the initia7 tive will be performed, and the location of the af8 fected Federal and contractor employees if different 

9 from the initiative location or locations. 

10 (4) The functions to be included in the initia11 tive. 

12 (5) The timeline for development and imple13 mentation of the initiative. 

14 (6) The estimated duration of the initiative if 

15 such initiative is deemed to be temporary. 

16 (7) The anticipated budget savings and pro17 grammatic improvements. 

18 (c) PRE-IMPLEMENTATION REPORT.—Not later than 

19 45 days before beginning implementation of a business 

20 process reengineering project, the head of the executive 

21 agency shall submit to the Committee on Government 

22 Oversight and Reform of the House of Representatives 

23 and the Committee on Homeland Security and Govern24 mental Affairs of the Senate a report on the proposed 


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1 project, including the information described in subsection 

2 (b). 

3 (d) CONSISTENCY WITH EXISTING LAW.—All busi4 ness process reengineering projects shall be implemented 

5 in a manner that is consistent with paragraphs (2) and 

6 (3) of section 7106(b) of title 5, United States Code. Such 

7 projects shall not result in a change of the collective bar8 gaining status of affected Federal employees in the execu9 tive agency or in the representation status of a labor orga10 nization with exclusive representation status, as provided 

11 under section 7114 of title 5, United States Code. 

12 (e) ENHANCEMENT OF FEDERAL EMPLOYEE BUY13 IN.—The head of an executive agency shall, in order to 

14 promote the active cooperation of affected Federal employ15 ees— 

16 (1) consider all business process reengineering 

17 projects through any labor-management partnership 

18 arrangements; 

19 (2) provide any reports required under sub20 section (c) to any labor organization with national 

21 consultation rights under section 7113 of title 5, 

22 United States Code, at least 60 days before they are 

23 provided to Congress under such subsection; and 

24 (3) involve discussions and bargaining over the 

25 impact of implementation of any projects upon any 


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1 bargaining unit with the exclusive representatives of 

2 the executive agency’s Federal workforce, as pro3 vided under section 7114 and sections 7106(b)(2) 

4 and (b)(3) of title 5, United States Code. 

5 (f) PERSONNEL INCREASES OR REDUCTIONS.—Any 

6 personnel increases or reductions in the Federal employee 

7 or contractor workforces must be based on the require8 ments of a specific business process reengineering project 

9 and not on unrelated or predetermined cost and savings 

10 assumptions. 

11 (g) ANNUAL EVALUATION.—Not later than October 

12 31, 2012, and annually thereafter, the Director of the Of13 fice of Management and Budget shall conduct a perform14 ance review of ongoing business process reengineering 

15 projects and submit a report on such review to the Com16 mittee on Government Oversight and Reform of the House 

17 of Representatives and the Committee on Homeland Secu18 rity and Governmental Affairs of the Senate. Each busi19 ness process reengineering project shall be evaluated with 

20 respect to the level of performance in the following areas: 

21 (1) Costs, savings, and overall financial per22 formance of the organization. 

23 (2) Organic knowledge, skills or expertise. 

24 (3) Efficiency and effectiveness of key functions 

25 or processes. 


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1 (4) Efficiency and effectiveness of the overall 

2 organization. 

3 SEC. 12. REFORMS TO THE OMB CIRCULAR A–76 PROCESS. 

4 (a) SENSE OF CONGRESS.—It is the sense of Con5 gress that, with respect to Office of Management and 

6 Budget Circular A–76 or any other related administrative 

7 regulation, directive, or policy, the following policies and 

8 procedures should be implemented: 

9 (1) A standard study shall last no longer than 

10 2 years, from the beginning of the preliminary plan11 ning process to the rendering of the award decision, 

12 which period shall be calculated as follows: 

13 (A) Any days during which a standard 

14 study is suspended because of bid protests on 

15 behalf of the affected Federal employees shall 

16 not be included when determining the length of 

17 a standard study. 

18 (B) However, any days during which a 

19 standard study is extended because of addi20 tional activity that is either required by the 

21 Government Accountability Office, directed by 

22 the contracting officer subsequent to an appeal 

23 to the Government Accountability Office or the 

24 dismissal or denial of a protest to the Govern25 ment Accountability Office shall be included 


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1 when determining the length of a standard 

2 study. 

3 (C) No executive agency may stop and re4 start a standard study in order to avoid compli5 ance with this paragraph. Similarly, an execu6 tive agency may not subject a function to a 

7 standard study if it was earlier subjected to a 

8 standard study that had to be stopped because 

9 of the length limitation under this paragraph. 

10 (2) The conversion differential shall be— 

11 (A) significantly increased in order to in12 clude the large costs that are currently excluded 

13 from consideration, including preliminary plan14 ning costs, consultants costs, costs of Federal 

15 employees diverted from their actual jobs to 

16 work on studies, transition costs, post-competi17 tion reviews costs, and proportional costs for 

18 agencies’ privatization bureaucracies (including 

19 both Federal employees and contractors); and 

20 (B) doubled when a standard study begins 

21 its thirteenth month, which period shall be cal22 culated as follows: 

23 (i) Any days during which a standard 

24 study is suspended because of bid protests 

25 on behalf of the affected Federal employees 


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1 shall not be included when determining the 

2 length of a standard study for purposes of 

3 doubling the cost differential. 

4 (ii) However, any days during which a 

5 standard study is extended because of ad6 ditional activity that is either required by 

7 the Government Accountability Office, di8 rected by the contracting officer subse9 quent to an appeal to the Government Ac10 countability Office or the dismissal or de11 nial of a protest to the Government Ac12 countability Office shall be included when 

13 determining the length of a standard 

14 study. 

15 (3) Bids or tenders filed on behalf of Federal 

16 employees shall include only the overhead costs actu17 ally incurred for those Federal employees performing 

18 the specific functions being reviewed, and may not 

19 include an assessment of an automatic charge for 

20 overhead. 

21 (4) A reliable system to track costs, savings, 

22 and quality from OMB Circular A–76 studies that 

23 has been implemented, tested, and determined to be 

24 accurate and reliable over a long-term and a short25 term period should be established. The system estabVerDate Mar 15 2010 02:38 May 28, 2011 Jkt 099200 PO 00000 Frm 00031 Fmt 6652 Sfmt 6201 E:\BILLS\H1949.IH H1949

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1 lished should also take into account the possibility 

2 for greater efficiencies and programmatic improve3 ments that can be generated through business proc4 ess reengineering projects, pursuant to section 10. 

5 (5) NO RECOMPETITION REQUIRED.—No Fed6 eral employee workforce should be recompeted under 

7 OMB Circular A–76 unless the head of the relevant 

8 executive agency, without delegation— 

9 (A) has signed a certification that such 

10 workforce failed to fulfill the terms of the letter 

11 of obligation or other agreement, as applicable, 

12 pursuant to an earlier OMB Circular A–76 

13 study; and 

14 (B) published that certification on 

15 fedbizopps.gov before the end of the expiration 

16 of the performance period. 

17 (b) GAO REPORT.— 

18 (1) REPORT REQUIRED.—Not later than 18 

19 months after the date of the enactment of this Act, 

20 the Comptroller General of the United States shall 

21 submit to the Committee on Government Oversight 

22 and Reform of the House of Representatives and the 

23 Committee on Homeland Security and Governmental 

24 Affairs of the Senate a report with recommendations 

25 for executive agencies (other than the Office of ManVerDate Mar 15 2010 02:38 May 28, 2011 Jkt 099200 PO 00000 Frm 00032 Fmt 6652 Sfmt 6201 E:\BILLS\H1949.IH H1949

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1 agement and Budget) to more fairly, effectively, ex2 peditiously, transparently, and apolitically oversee 

3 studies conducted under the Office of Management 

4 and Budget Circular A–76 or any other related ad5 ministrative regulation, directive, or policy, and en6 force the rules that govern those studies. 

7 (2) CLARIFICATION OF SCOPE OF REPORT.— 

8 This subsection does not require the Government 

9 Accountability Office to examine the rule-making au10 thority of the Office of Management and Budget 

11 with regard to OMB Circular A–76 or any other re12 lated administrative regulation, directive, or policy. 

13 (3) CONSULTATION WITH AGENCIES AND

14 STAKEHOLDERS.—In preparing the report under 

15 this subsection, the Comptroller General of the 

16 United States should consult with personnel of the 

17 Office of Management and Budget, staffing and 

18 manpower personnel of other executive agencies, per19 sonnel in the offices of other agencies’ inspectors 

20 general, and representatives from Federal employee 

21 unions and contractor associations. 


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1 SEC. 13. ESTABLISHMENT OF TEMPORARY SUSPENSION ON 

2 USE OF OMB CIRCULAR A–76 PROCESS UNTIL 

3 REFORMS REQUIRED IN THIS ACT HAVE 

4 BEEN SUBSTANTIALLY IMPLEMENTED. 

5 No study or public-private competition regarding the 

6 conversion to contractor performance of any function per7 formed by Federal employees pursuant to Office of Man8 agement and Budget Circular A–76 or any other adminis9 trative regulation, directive, or policy, may be prepared 

10 for, announced, undertaken, continued, or finished until 

11 the Director of the Office of Management and Budget, in 

12 consultation with the inspectors general of the 5 largest 

13 Federal departments in terms of annual budgets as of the 

14 date of the enactment of this Act, determines that— 

15 (1) at least three-fourths of all executive agen16 cies have made substantial progress in the imple17 mentation of all the reforms— 

18 (A) required in sections 6, 7, 8, and 9 of 

19 this Act; and 

20 (B) enacted pursuant to section 739 of the 

21 Financial Services and General Government Ap22 propriations Act, 2008 (division D of Public 

23 Law 110–161; 31 U.S.C. 501 note), under 

24 which each covered executive agency is required 

25 to devise and implement guidelines and proce26 dures to ensure that consideration is given to 


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1 using, on a regular basis, Federal employees to 

2 perform new functions as well as functions that 

3 are currently performed by contractors; and 

4 (2) the Office of Management and Budget has 

5 implemented the reforms to the OMB Circular A–76 

6 described under section 12. 

Æ 


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