II 

115TH CONGRESS 

1ST SESSION S. 234 

To provide incentives for businesses to keep jobs in America. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 24, 2017 

Mr. DONNELLY (for himself, Mrs. GILLIBRAND, and Mr. BROWN) introduced 

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

on Finance 

A BILL 

To provide incentives for businesses to keep jobs in America. 

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 ‘‘End Outsourcing Act’’. 

5 SEC. 2. OUTSOURCING STATEMENT IN WORKER ADJUST6 MENT AND RETRAINING NOTICE. 

7 (a) OUTSOURCING STATEMENT.—Section 3 of the 

8 Worker Adjustment and Retraining Notification Act (29 

9 U.S.C. 2102) is amended by adding at the end the fol10 lowing: 

11 ‘‘(e) OUTSOURCING STATEMENT.— 


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1 ‘‘(1) IN GENERAL.—For purposes of subsection 

2 (a), the employer shall include an outsourcing state3 ment in the notice described in that subsection. The 

4 outsourcing statement shall specify whether part or 

5 all of the positions held by affected employees cov6 ered by subsection (a) will be moved to a country 

7 outside the United States, regardless of whether the 

8 positions are moved within the business enterprise 

9 involved or to another business enterprise. The em10 ployer shall make the determination of whether the 

11 positions are being so moved in accordance with reg12 ulations issued by the Secretary. The employer shall 

13 serve the notice as required under subsection (a) and 

14 submit the notice to the Secretary of Labor. 

15 ‘‘(2) LIST.—Not less often than annually, the 

16 Secretary shall publish and make available on the 

17 website of the Department of Labor, a list including 

18 each employer who— 

19 ‘‘(A) has included an outsourcing state20 ment in a notice under paragraph (1); or 

21 ‘‘(B) has incurred liability under section 5, 

22 in part or in whole, because the employer or23 dered a plant closing or mass layoff without 

24 having served a notice that is required, under 


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1 this section, to include an outsourcing state2 ment.’’. 

3 (b) IMPLEMENTATION REPORT.—The Worker Ad4 justment and Retraining Notification Act is amended by 

5 inserting after section 10 (29 U.S.C. 2109) the following: 

6 ‘‘SEC. 10A. IMPLEMENTATION STUDY. 

7 ‘‘(a) STUDY.—The Comptroller General of the United 

8 States shall conduct a study of the implementation of sec9 tion 3(e) of the Worker Adjustment and Retraining Notifi10 cation Act (29 U.S.C. 2102(e)) by the Department of 

11 Labor. 

12 ‘‘(b) REPORT.—Not later than 3 years after the date 

13 of enactment of this Act, the Comptroller General shall 

14 submit to the appropriate committees of Congress a report 

15 containing the results of the study.’’. 

16 SEC. 3. DENIAL OF DEDUCTION FOR OUTSOURCING EX17 PENSES. 

18 (a) IN GENERAL.—Part IX of subchapter B of chap19 ter 1 of the Internal Revenue Code of 1986 is amended 

20 by adding at the end the following new section: 

21 ‘‘SEC. 280I. OUTSOURCING EXPENSES. 

22 ‘‘(a) IN GENERAL.—No deduction otherwise allow23 able under this chapter shall be allowed for any specified 

24 outsourcing expense. 


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1 ‘‘(b) SPECIFIED OUTSOURCING EXPENSE.—For pur2 poses of this section— 

3 ‘‘(1) IN GENERAL.—The term ‘specified out4 sourcing expense’ means— 

5 ‘‘(A) any eligible expense paid or incurred 

6 by the taxpayer in connection with the elimi7 nation of any business unit of the taxpayer (or 

8 of any member of any expanded affiliated group 

9 in which the taxpayer is also a member) located 

10 within the United States, and 

11 ‘‘(B) any eligible expense paid or incurred 

12 by the taxpayer in connection with the estab13 lishment of any business unit of the taxpayer 

14 (or of any member of any expanded affiliated 

15 group in which the taxpayer is also a member) 

16 located outside the United States, 

17 if such establishment constitutes the relocation of 

18 the business unit so eliminated. For purposes of the 

19 preceding sentence, a relocation shall not be treated 

20 as failing to occur merely because such elimination 

21 occurs in a different taxable year than such estab22 lishment. 

23 ‘‘(2) ELIGIBLE EXPENSES.—The term ‘eligible 

24 expenses’ means— 


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1 ‘‘(A) any amount for which a deduction is 

2 allowed to the taxpayer under section 162, and 

3 ‘‘(B) permit and license fees, lease broker4 age fees, equipment installation costs, and, to 

5 the extent provided by the Secretary, other 

6 similar expenses. 

7 Such term does not include any compensation which 

8 is paid or incurred in connection with severance 

9 from employment and, to the extent provided by the 

10 Secretary, any similar amount. 

11 ‘‘(3) BUSINESS UNIT.—The term ‘business unit’ 

12 means— 

13 ‘‘(A) any trade or business, and 

14 ‘‘(B) any line of business, or functional 

15 unit, which is part of any trade or business. 

16 ‘‘(4) EXPANDED AFFILIATED GROUP.—The 

17 term ‘expanded affiliated group’ means an affiliated 

18 group as defined in section 1504(a), determined 

19 without regard to section 1504(b)(3) and by sub20 stituting ‘more than 50 percent’ for ‘at least 80 per21 cent’ each place it appears in section 1504(a). A 

22 partnership or any other entity (other than a cor23 poration) shall be treated as a member of an ex24 panded affiliated group if such entity is controlled 

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1 bers of such group (including any entity treated as 

2 a member of such group by reason of this para3 graph). 

4 ‘‘(5) OPERATING EXPENSES NOT TAKEN INTO

5 ACCOUNT.—Any amount paid or incurred in connec6 tion with the ongoing operation of a business unit 

7 shall not be treated as an amount paid or incurred 

8 in connection with the establishment or elimination 

9 of such business unit. 

10 ‘‘(c) SPECIAL RULES.— 

11 ‘‘(1) APPLICATION TO DEDUCTIONS FOR DE12 PRECIATION AND AMORTIZATION.—In the case of 

13 any portion of a specified outsourcing expense which 

14 is not deductible in the taxable year in which paid 

15 or incurred, such portion shall neither be chargeable 

16 to capital account nor amortizable. 

17 ‘‘(2) POSSESSIONS TREATED AS PART OF THE

18 UNITED STATES.—For purposes of this section, the 

19 term ‘United States’ shall be treated as including 

20 each possession of the United States (including the 

21 Commonwealth of Puerto Rico and the Common22 wealth of the Northern Mariana Islands). 

23 ‘‘(d) REGULATIONS.—The Secretary shall prescribe 

24 such regulations or other guidance as may be necessary 

25 or appropriate to carry out the purposes of this section, 


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1 including regulations which provide (or create a rebuttable 

2 presumption) that certain establishments of business units 

3 outside the United States will be treated as relocations 

4 (based on timing or such other factors as the Secretary 

5 may provide) of business units eliminated within the 

6 United States.’’. 

7 (b) LIMITATION ON SUBPART F INCOME OF CON8 TROLLED FOREIGN CORPORATIONS DETERMINED WITH9 OUT REGARD TO SPECIFIED OUTSOURCING EXPENSES.— 

10 Subsection (c) of section 952 of such Code is amended 

11 by adding at the end the following new paragraph: 

12 ‘‘(4) EARNINGS AND PROFITS DETERMINED

13 WITHOUT REGARD TO SPECIFIED OUTSOURCING EX14 PENSES.—For purposes of this subsection, earnings 

15 and profits of any controlled foreign corporation 

16 shall be determined without regard to any specified 

17 outsourcing expense (as defined in section 

18 280I(b)).’’. 

19 (c) CLERICAL AMENDMENT.—The table of sections 

20 for part IX of subchapter B of chapter 1 of such Code 

21 is amended by adding at the end the following new item: 

‘‘Sec. 280I. Outsourcing expenses.’’. 

22 (d) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to amounts paid or incurred after 

24 the date of the enactment of this Act. 


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1 SEC. 4. DENIAL OF CERTAIN DEDUCTIONS AND ACCOUNT2 ING METHODS FOR OUTSOURCING EMPLOY3 ERS. 

4 (a) IN GENERAL.—Part IX of subchapter B of chap5 ter 1 of the Internal Revenue Code of 1986 is amended 

6 by adding at the end the following new section: 

7 ‘‘SEC. 280J. LIMITATIONS FOR OUTSOURCING EMPLOYERS. 

8 ‘‘(a) IN GENERAL.—During the disallowance period, 

9 an applicable taxpayer— 

10 ‘‘(1) shall not be allowed any deduction under 

11 section 199 for any income of the taxpayer, 

12 ‘‘(2) may not use the method provided in sec13 tion 472(b) in inventorying goods, 

14 ‘‘(3) may not use the lower of cost or market 

15 method of determining inventories for purposes of 

16 determining income, and 

17 ‘‘(4) shall not be allowed any deduction under 

18 section 163 for interest paid or accrued on indebted19 ness. 

20 ‘‘(b) APPLICABLE TAXPAYER.—For purposes of sub21 section (a), the term ‘applicable taxpayer’ means a tax22 payer which— 

23 ‘‘(1) during the taxable year, has served written 

24 notice under subsection (a) of section 3 of the Work25 er Adjustment and Retraining Notification Act 


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1 which includes an outsourcing statement described 

2 in subsection (e) of such section, and 

3 ‘‘(2) the cumulative employment loss (excluding 

4 any part-time employees) for positions at facilities 

5 owned by such taxpayer which will be moved to a 

6 country outside of the United States, as determined 

7 pursuant to any outsourcing statements served by 

8 such taxpayer during such taxable year, exceeds 50 

9 employees. 

10 ‘‘(c) DISALLOWANCE PERIOD.—For purposes of sub11 section (a), the disallowance period is the period of 3 tax12 able years after the taxable year in which the statements 

13 described in subsection (b)(2) are required to be served. 

14 ‘‘(d) EXPANDED AFFILIATED GROUP TREATED AS

15 SINGLE TAXPAYER.—For purposes of this section, the 

16 members of an expanded affiliated group (as defined in 

17 section 280I(b)(4)) shall be treated as a single taxpayer. 

18 ‘‘(e) REGULATIONS.—The Secretary shall prescribe 

19 such regulations or other guidance as may be necessary 

20 or appropriate to carry out the purposes of this section.’’. 

21 (b) CLERICAL AMENDMENT.—The table of sections 

22 for part IX of subchapter B of chapter 1 of the Internal 

23 Revenue Code of 1986 is amended by adding at the end 

24 the following new item: 

‘‘Sec. 280J. Limitations for outsourcing employers.’’. 


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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years beginning after 

3 the date of the enactment of this Act. 

4 SEC. 5. RECAPTURE OF CREDITS FOR OUTSOURCING EM5 PLOYERS. 

6 (a) IN GENERAL.—Part IV of subchapter A of chap7 ter 1 of the Internal Revenue Code of 1986 is amended 

8 by adding at the end the following new subpart: 

9 ‘‘Subpart K—Recapture of Credits for Outsourcing 

10 Employers 

‘‘Sec. 54BB. Recapture of credits for outsourcing employers. 

11 ‘‘SEC. 54BB. RECAPTURE OF CREDITS FOR OUTSOURCING 

12 EMPLOYERS. 

13 ‘‘(a) IN GENERAL.—Pursuant to regulations pre14 scribed by the Secretary, in the case of a taxpayer which 

15 owns a facility for which there is an outsourcing event dur16 ing the taxable year, the tax under this chapter for such 

17 taxable year shall be increased by the amount equal to 

18 the sum of— 

19 ‘‘(1) any credits allowed under this chapter re20 lating to expenses for design, construction, oper21 ation, or maintenance of such facility during the 5 

22 taxable years preceding such taxable year, and 


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1 ‘‘(2) any grants provided by the Secretary in 

2 lieu of credits described in paragraph (1) during the 

3 5 taxable years preceding such taxable year. 

4 ‘‘(b) OUTSOURCING EVENT.—For purposes of sub5 section (a), the term ‘outsourcing event’ means a plant 

6 closing or mass layoff (as described in section 2(a) of the 

7 Worker Adjustment and Retraining Notification Act) in 

8 which the employment loss (excluding any part-time em9 ployees) for positions which will be moved to a country 

10 outside of the United States, as determined pursuant to 

11 the outsourcing statement (as described in paragraph (1) 

12 of such section 3(e) of such Act) served by the taxpayer 

13 during the taxable year, exceeds 50 employees. 

14 ‘‘(c) EXPANDED AFFILIATED GROUP TREATED AS

15 SINGLE TAXPAYER.—For purposes of this section, the 

16 members of an expanded affiliated group (as defined in 

17 section 280I(b)(4)) shall be treated as a single taxpayer.’’. 

18 (b) CLERICAL AMENDMENT.—The table of subparts 

19 for part IV of subchapter A of chapter 1 of such Code 

20 is amended by adding at the end the following new item: 

‘‘SUBPART K. RECAPTURE OF CREDITS FOR OUTSOURCING EMPLOYERS’’. 

21 (c) EFFECTIVE DATE.—The amendments made by 

22 this section shall apply to taxable years beginning after 

23 the date of the enactment of this Act. 


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1 SEC. 6. CREDIT FOR INSOURCING EXPENSES. 

2 (a) IN GENERAL.—Subpart D of part IV of sub3 chapter A of chapter 1 of the Internal Revenue Code of 

4 1986 is amended by adding at the end the following new 

5 section: 

6 ‘‘SEC. 45S. CREDIT FOR INSOURCING EXPENSES. 

7 ‘‘(a) IN GENERAL.—For purposes of section 38, the 

8 insourcing expenses credit for any taxable year is an 

9 amount equal to 20 percent of the eligible insourcing ex10 penses of the taxpayer which are taken into account in 

11 such taxable year under subsection (d). 

12 ‘‘(b) ELIGIBLE INSOURCING EXPENSES.—For pur13 poses of this section— 

14 ‘‘(1) IN GENERAL.—The term ‘eligible 

15 insourcing expenses’ means— 

16 ‘‘(A) eligible expenses paid or incurred by 

17 the taxpayer in connection with the elimination 

18 of any business unit of the taxpayer (or of any 

19 member of any expanded affiliated group in 

20 which the taxpayer is also a member) located 

21 outside the United States, and 

22 ‘‘(B) eligible expenses paid or incurred by 

23 the taxpayer in connection with the establish24 ment of any business unit of the taxpayer (or 

25 of any member of any expanded affiliated group 


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1 in which the taxpayer is also a member) located 

2 within— 

3 ‘‘(i) a HUBZone (as defined in sec4 tion 3(p)(2) of the Small Business Act (15 

5 U.S.C. 632(p)(2))), or 

6 ‘‘(ii) a low-income community (as de7 scribed in section 45D(e)), 

8 if such establishment constitutes the relocation of 

9 the business unit so eliminated. For purposes of the 

10 preceding sentence, a relocation shall not be treated 

11 as failing to occur merely because such elimination 

12 occurs in a different taxable year than such estab13 lishment. 

14 ‘‘(2) ELIGIBLE EXPENSES.—The term ‘eligible 

15 expenses’ means— 

16 ‘‘(A) any amount for which a deduction is 

17 allowed to the taxpayer under section 162, and 

18 ‘‘(B) permit and license fees, lease broker19 age fees, equipment installation costs, and, to 

20 the extent provided by the Secretary, other 

21 similar expenses. 

22 Such term does not include any compensation which 

23 is paid or incurred in connection with severance 

24 from employment and, to the extent provided by the 

25 Secretary, any similar amount. 


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1 ‘‘(3) BUSINESS UNIT.—The term ‘business unit’ 

2 means— 

3 ‘‘(A) any trade or business, and 

4 ‘‘(B) any line of business, or functional 

5 unit, which is part of any trade or business. 

6 ‘‘(4) EXPANDED AFFILIATED GROUP.—The 

7 term ‘expanded affiliated group’ means an affiliated 

8 group as defined in section 1504(a), determined 

9 without regard to section 1504(b)(3) and by sub10 stituting ‘more than 50 percent’ for ‘at least 80 per11 cent’ each place it appears in section 1504(a). A 

12 partnership or any other entity (other than a cor13 poration) shall be treated as a member of an ex14 panded affiliated group if such entity is controlled 

15 (within the meaning of section 954(d)(3)) by mem16 bers of such group (including any entity treated as 

17 a member of such group by reason of this para18 graph). 

19 ‘‘(5) EXPENSES MUST BE PURSUANT TO

20 INSOURCING PLAN.—Amounts shall be taken into ac21 count under paragraph (1) only to the extent that 

22 such amounts are paid or incurred pursuant to a 

23 written plan to carry out the relocation described in 

24 paragraph (1). 


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1 ‘‘(6) OPERATING EXPENSES NOT TAKEN INTO

2 ACCOUNT.—Any amount paid or incurred in connec3 tion with the on-going operation of a business unit 

4 shall not be treated as an amount paid or incurred 

5 in connection with the establishment or elimination 

6 of such business unit. 

7 ‘‘(c) INCREASED DOMESTIC EMPLOYMENT REQUIRE8 MENT.—No credit shall be allowed under this section un9 less the number of full-time equivalent employees of the 

10 taxpayer for the taxable year for which the credit is 

11 claimed exceeds the number of full-time equivalent em12 ployees of the taxpayer for the last taxable year ending 

13 before the first taxable year in which such eligible 

14 insourcing expenses were paid or incurred. For purposes 

15 of this subsection, full-time equivalent employees has the 

16 meaning given such term under section 45R(d) (and the 

17 applicable rules of section 45R(e)). All employers treated 

18 as a single employer under subsection (b), (c), (m), or (o) 

19 of section 414 shall be treated as a single employer for 

20 purposes of this subsection. 

21 ‘‘(d) CREDIT ALLOWED UPON COMPLETION OF

22 INSOURCING PLAN.— 

23 ‘‘(1) IN GENERAL.—Except as provided in para24 graph (2), eligible insourcing expenses shall be taken 

25 into account under subsection (a) in the taxable year 


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1 during which the plan described in subsection (b)(5) 

2 has been completed and all eligible insourcing ex3 penses pursuant to such plan have been paid or in4 curred. 

5 ‘‘(2) ELECTION TO APPLY EMPLOYMENT TEST

6 AND CLAIM CREDIT IN FIRST FULL TAXABLE YEAR

7 AFTER COMPLETION OF PLAN.—If the taxpayer 

8 elects the application of this paragraph, eligible 

9 insourcing expenses shall be taken into account 

10 under subsection (a) in the first taxable year after 

11 the taxable year described in paragraph (1). 

12 ‘‘(e) POSSESSIONS TREATED AS PART OF THE

13 UNITED STATES.—For purposes of this section, the term 

14 ‘United States’ shall be treated as including each posses15 sion of the United States (including the Commonwealth 

16 of Puerto Rico and the Commonwealth of the Northern 

17 Mariana Islands). 

18 ‘‘(f) REGULATIONS.—The Secretary shall prescribe 

19 such regulations or other guidance as may be necessary 

20 or appropriate to carry out the purposes of this section.’’. 

21 (b) CREDIT TO BE PART OF GENERAL BUSINESS

22 CREDIT.—Subsection (b) of section 38 of such Code is 

23 amended by striking ‘‘plus’’ at the end of paragraph (35), 

24 by striking the period at the end of paragraph (36) and 


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1 inserting ‘‘, plus’’, and by adding at the end the following 

2 new paragraph: 

3 ‘‘(37) the insourcing expenses credit determined 

4 under section 45S(a).’’. 

5 (c) CLERICAL AMENDMENT.—The table of sections 

6 for subpart D of part IV of subchapter A of chapter 1 

7 of such Code is amended by adding at the end the fol8 lowing new item: 

‘‘Sec. 45S. Credit for insourcing expenses.’’. 

9 (d) EFFECTIVE DATE.—The amendments made by 

10 this section shall apply to amounts paid or incurred after 

11 the date of the enactment of this Act. 

12 (e) APPLICATION TO UNITED STATES POSSES13 SIONS.— 

14 (1) PAYMENTS TO POSSESSIONS.— 

15 (A) MIRROR CODE POSSESSIONS.—The 

16 Secretary of the Treasury shall make periodic 

17 payments to each possession of the United 

18 States with a mirror code tax system in an 

19 amount equal to the loss to that possession by 

20 reason of section 45S of the Internal Revenue 

21 Code of 1986. Such amount shall be determined 

22 by the Secretary of the Treasury based on in23 formation provided by the government of the re24 spective possession. 


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1 (B) OTHER POSSESSIONS.—The Secretary 

2 of the Treasury shall make annual payments to 

3 each possession of the United States which does 

4 not have a mirror code tax system in an 

5 amount estimated by the Secretary of the 

6 Treasury as being equal to the aggregate bene7 fits that would have been provided to residents 

8 of such possession by reason of section 45S of 

9 such Code if a mirror code tax system had been 

10 in effect in such possession. The preceding sen11 tence shall not apply with respect to any posses12 sion of the United States unless such possession 

13 has a plan, which has been approved by the 

14 Secretary of the Treasury, under which such 

15 possession will promptly distribute such pay16 ment to the residents of such possession. 

17 (2) COORDINATION WITH CREDIT ALLOWED

18 AGAINST UNITED STATES INCOME TAXES.—No cred19 it shall be allowed against United States income 

20 taxes under section 45S of such Code to any per21 son— 

22 (A) to whom a credit is allowed against 

23 taxes imposed by the possession by reason of 

24 such section, or 


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1 (B) who is eligible for a payment under a 

2 plan described in paragraph (1)(B). 

3 (3) DEFINITIONS AND SPECIAL RULES.— 

4 (A) POSSESSIONS OF THE UNITED

5 STATES.—For purposes of this section, the 

6 term ‘‘possession of the United States’’ includes 

7 the Commonwealth of Puerto Rico and the 

8 Commonwealth of the Northern Mariana Is9 lands. 

10 (B) MIRROR CODE TAX SYSTEM.—For pur11 poses of this section, the term ‘‘mirror code tax 

12 system’’ means, with respect to any possession 

13 of the United States, the income tax system of 

14 such possession if the income tax liability of the 

15 residents of such possession under such system 

16 is determined by reference to the income tax 

17 laws of the United States as if such possession 

18 were the United States. 

19 (C) TREATMENT OF PAYMENTS.—For pur20 poses of section 1324(b)(2) of title 31, United 

21 States Code, the payments under this section 

22 shall be treated in the same manner as a refund 

23 due from sections referred to in such section 

24 1324(b)(2). 


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1 SEC. 7. AUTHORITY FOR FEDERAL CONTRACTING OFFI2 CERS TO TAKE THE OUTSOURCING OF JOBS 

3 FROM THE UNITED STATES INTO ACCOUNT 

4 IN AWARDING CONTRACTS. 

5 (a) DEPARTMENT OF DEFENSE AND RELATED

6 AGENCY CONTRACTS.— 

7 (1) CONSIDERATION OF OUTSOURCING.— 

8 (A) IN GENERAL.—Chapter 137 of title 

9 10, United States Code, is amended by insert10 ing after section 2327 the following new sec11 tion: 

12 ‘‘§ 2327a. Contracts: consideration of outsourcing of 

13 jobs 

14 ‘‘(a) DISCLOSURE OF OUTSOURCING OF JOBS.— 

15 ‘‘(1) IN GENERAL.—The head of an agency 

16 shall require a contractor that submits a bid or pro17 posal in response to a solicitation issued by the 

18 agency to disclose in that bid or proposal if the con19 tractor, or a subsidiary of the contractor, owns a fa20 cility for which there is an outsourcing event during 

21 the three-year period ending on the date of the sub22 mittal of the bid or proposal. 

23 ‘‘(2) OUTSOURCING EVENT.—For purposes of 

24 paragraph (1), the term ‘outsourcing event’ means a 

25 plant closing or mass layoff (as described in section 

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1 fication Act) in which the employment loss (exclud2 ing any part-time employees) for positions which will 

3 be moved to a country outside of the United States, 

4 as determined pursuant to the outsourcing state5 ment (as described in paragraph (1) of such section 

6 3(e) of such Act) served by the taxpayer during the 

7 taxable year, exceeds 50 employees. 

8 ‘‘(b) CONSIDERATION AUTHORIZED.—(1) Agency 

9 contracting officers considering bids or proposals in re10 sponse to a solicitation issued by the agency may take into 

11 account any disclosure made pursuant to subsection (a) 

12 in such bids and proposals. 

13 ‘‘(2) The head of an agency may establish a negative 

14 preference of up to 10 percent of the cost of a contract 

15 for purposes of evaluating a bid or proposal of a contractor 

16 that makes a disclosure pursuant to subsection (a). 

17 ‘‘(c) SENSE OF CONGRESS.—It is the sense of Con18 gress that agency contracting officers should, using sec19 tion 2304(b)(3) of this title, exclude contractors making 

20 a disclosure pursuant to subsection (a) in response to so21 licitations issued by the agency from the bidding process 

22 in connection with such solicitations on the grounds that 

23 the actions described in the disclosures are against the 

24 public interests of the United States. 


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1 ‘‘(d) ANNUAL REPORT.—The head of each agency 

2 shall submit to Congress each year a report on the fol3 lowing: 

4 ‘‘(1) The number of solicitations made by the 

5 agency during the preceding year for which disclo6 sures were made pursuant to subsection (a) in re7 sponsive bids or proposals. 

8 ‘‘(2) The number of contracts awarded by the 

9 agency during the preceding year in which such dis10 closures were taken into account in the contract 

11 award.’’. 

12 (B) CLERICAL AMENDMENT.—The table of 

13 sections at the beginning of chapter 137 of such 

14 title is amended by inserting after the item re15 lating to section 2327 the following new item: 

‘‘2327a. Contracts: consideration of outsourcing of jobs.’’. 

16 (2) EXCLUSION OF FIRMS FROM SOURCES.— 

17 Section 2304(b) of such title is amended— 

18 (A) by redesignating paragraphs (3) and 

19 (4) as paragraphs (4) and (5), respectively; 

20 (B) by inserting after paragraph (2) the 

21 following new paragraph: 

22 ‘‘(3) The head of an agency may provide for the pro23 curement of property and services covered by this chapter 

24 using competitive procedures but excluding a source mak25 ing a disclosure pursuant to section 2327a(a) of this title 


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1 in the bid or proposal in response to the solicitation issued 

2 by the agency if the head of the agency determines that 

3 the actions described by disclosure are against the public 

4 interests of the United States and the source is to be ex5 cluded on those grounds. Any such determination shall 

6 take into account the sense of Congress set forth in section 

7 2327a(c) of this title.’’; and 

8 (C) in paragraph (3), as so redesignated, 

9 by striking ‘‘paragraphs (1) and (2)’’ and in10 serting ‘‘paragraphs (1), (2), and (3)’’. 

11 (b) OTHER FEDERAL CONTRACTS.— 

12 (1) CONSIDERATION OF OUTSOURCING.—Chap13 ter 35 of title 41, United States Code, is amended 

14 by inserting after section 3303 the following new 

15 section: 

16 ‘‘§ 3303a. Bidders outsourcing jobs: disclosure of out17 sourcing; consideration of outsourcing in 

18 award; exclusion from sources 

19 ‘‘(a) DISCLOSURE OF OUTSOURCING OF JOBS.— 

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

21 agency shall require a contractor that submits a bid 

22 or proposal in response to a solicitation issued by 

23 the executive agency to disclose in that bid or pro24 posal if the contractor, or a subsidiary of the con25 tractor, owns a facility for which there is an outVerDate Sep 11 2014 00:20 Feb 02, 2017 Jkt 069200 PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 E:\BILLS\S234.IS S234

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1 sourcing event during the three-year period ending 

2 on the date of the submittal of the bid or proposal. 

3 ‘‘(2) OUTSOURCING EVENT.—For purposes of 

4 paragraph (1), the term ‘outsourcing event’ means a 

5 plant closing or mass layoff (as described in section 

6 2(a) of the Worker Adjustment and Retraining Noti7 fication Act) in which the employment loss (exclud8 ing any part-time employees) for positions which will 

9 be moved to a country outside of the United States, 

10 as determined pursuant to the outsourcing state11 ment (as described in paragraph (1) of such section 

12 3(e) of such Act) served by the taxpayer during the 

13 taxable year, exceeds 50 employees. 

14 ‘‘(b) CONSIDERATION AUTHORIZED.—(1) Con15 tracting officers of an executive agency considering bids 

16 or proposals in response to a solicitation issued by the ex17 ecutive agency may take into account any disclosure made 

18 pursuant to subsection (a) in such bids and proposals. 

19 ‘‘(2) The head of an executive agency may establish 

20 a negative preference of up to 10 percent of the cost of 

21 a contract for purposes of evaluating a bid or proposal 

22 of a contractor that makes a disclosure pursuant to sub23 section (a). 

24 ‘‘(c) EXCLUSION FROM SOURCES.— 


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

2 agency may provide for the procurement of property 

3 and services using competitive procedures but ex4 cluding a source making a disclosure under sub5 section (a) in the bid or proposal in response to the 

6 solicitation issued by the executive agency if the 

7 head of the executive agency determines that the ac8 tions described by disclosure are against the public 

9 interests of the United States and the source is to 

10 be excluded on those grounds. Any such determina11 tion shall take into account the sense of Congress 

12 set forth in paragraph (2). 

13 ‘‘(2) SENSE OF CONGRESS.—It is the sense of 

14 Congress that contracting officers of executive agen15 cies may use paragraph (1) to exclude contractors 

16 making a disclosure pursuant to subsection (a) in re17 sponse to a solicitation issued by the executive agen18 cy from the bidding process in connection with the 

19 solicitation on the grounds that the actions described 

20 by the disclosure are against the public interests of 

21 the United States. 

22 ‘‘(d) ANNUAL REPORT.—The head of each executive 

23 agency shall submit to Congress each year a report on the 

24 following: 


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1 ‘‘(1) The number of solicitations made by the 

2 executive agency during the preceding year for which 

3 disclosures were made pursuant to subsection (a) in 

4 responsive bids or proposals. 

5 ‘‘(2) The number of contracts awarded to con6 tractors that disclosed having outsourced more than 

7 50 jobs during the preceding three years.’’. 

8 (2) CLERICAL AMENDMENT.—The table of sec9 tions at the beginning of chapter 35 of such title is 

10 amended by inserting after the item relating to sec11 tion 3303 the following new item: 

‘‘3303a. Bidders outsourcing jobs: disclosure of outsourcing; consideration of 

outsourcing in award; exclusion from sources.’’. 

12 (3) CONFORMING AMENDMENT.—Section 

13 3301(a) of such title is amended by inserting 

14 ‘‘3303a(c),’’ after ‘‘3303,’’. 

15 (c) REGULATIONS.— 

16 (1) IN GENERAL.—Not later than 180 days 

17 after the date of the enactment of this Act, the Fed18 eral Acquisition Regulatory Council, in consultation 

19 with the heads of relevant agencies, shall amend the 

20 Federal Acquisition Regulation and the Defense 

21 Federal Acquisition Regulation Supplement to carry 

22 out the requirements of section 3303a of title 41, 

23 United States Code, and section 2327a of title 10, 

24 United States Code, as added by this section. 


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1 (2) DEFINITION OF OUTSOURCING.—For pur2 poses of defining outsourcing pursuant to paragraph 

3 (1), the Federal Acquisition Regulatory Council may 

4 utilize regulations prescribed by the Secretary of 

5 Labor. 

6 (d) RULE OF CONSTRUCTION.—This section, and the 

7 amendments made by this section, shall be applied in a 

8 manner consistent with United States obligations under 

9 international agreements. 

Æ 


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