formation that identifies an individual or with re-
spect to which there is a reasonable basis to believe 
that the information can be used to identify an indi-
vidual, may not disclose the information for any pur-
pose other than such recovery auditing or recovery 
activity and governmental oversight of such activity, 
unless disclosure for that other purpose is author-
ized by the individual to the executive agency that 
contracted for the performance of the recovery au-
diting or recovery activity. 
(6) 
OTHER
RECOVERY
AUDIT
REQUIRE-
MENTS.— 
(A) IN GENERAL.—(i) Except as provided 
in clause (ii), subchapter VI of chapter 35 of 
title 31, United States Code, is repealed. 
(ii) Section 3562(a) of title 31, United 
States Code, shall continue in effect, except 
that references in such section 3562(a) to pro-
grams carried out under section 3561 of such 
title, shall be interpreted to mean programs car-
ried out under section 2(h) of this Act. 
(B) TECHNICAL AND CONFORMING AMEND-
MENTS.— 
(i) TABLE OF SECTIONS.—The table 
of sections for chapter 35 of title 31,
United States Code, is amended by strik-
ing the matter relating to subchapter VI. 
(ii) DEFINITION.—Section 3501 of 
title 31, United States Code, is amended 
by striking ‘‘and subchapter VI of this 
title’’. 
(iii) HOMELAND SECURITY GRANTS.— 
Section 2022(a)(6) of the Homeland Secu-
rity Act of 2002 (6 U.S.C. 612(a)(6)) is 
amended by striking ‘‘(as that term is de-
fined by the Director of the Office of Man-
agement and Budget under section 3561 of 
title 31, United States Code)’’ and insert-
ing ‘‘under section 2(h) of the Improper 
Payments Elimination and Recovery Act of 
2010 (31 U.S.C. 3321 note)’’. 
(7) RULE OF CONSTRUCTION.—Except as pro-
vided under paragraph (5), nothing in this section 
shall be construed as terminating or in any way lim-
iting authorities that are otherwise available to agen-
cies under existing provisions of law to recover im-
proper payments and use recovered amounts. 
(i) REPORT
ON RECOVERY AUDITING.—Not later 
than 2 years after the date of the enactment of this Act, 
the Chief Financial Officers Council established under sec-
tion 302 of the Chief Financial Officers Act of 1990 (31 
U.S.C. 901 note), in consultation with the Council of In-
spectors General on Integrity and Efficiency established 
under section 7 of the Inspector General Reform Act of 
2009 (Public Law 110–409) and recovery audit experts, 
shall conduct a study of— 
(1) the implementation of subsection (h); 
(2) the costs and benefits of agency recovery 
audit activities, including those under subsection (h), 
and including the effectiveness of using the services 
of— 
(A) private contractors; 
(B) agency employees; 
(C) cross-servicing from other agencies; or 
(D) any combination of the provision of 
services described under subparagraphs (A) 
through (C); and 
(3) submit a report on the results of the study 
to— 
(A) the Committee on Homeland Security 
and Governmental Affairs of the Senate; 
(B) the Committee on Oversight and Gov-
ernment Reform of the House of Representa-
tives; and 
(C) the Comptroller General.
SEC. 3. COMPLIANCE. 
(a) DEFINITIONS.—In this section: 
(1) AGENCY.—The term ‘‘agency’’ has the 
meaning given under section 2(f) of the Improper 
Payments Information Act of 2002 (31 U.S.C. 3321 
note) as redesignated by this Act. 
(2) ANNUAL
FINANCIAL
STATEMENT.—The 
term ‘‘annual financial statement’’ means the annual 
financial statement required under section 3515 of 
title 31, United States Code, or similar provision of 
law. 
(3) COMPLIANCE.—The term ‘‘compliance’’ 
means that the agency— 
(A) has published an annual financial 
statement for the most recent fiscal year and 
posted that report and any accompanying mate-
rials required under guidance of the Office of 
Management and Budget on the agency 
website; 
(B) if required, has conducted a program 
specific risk assessment for each program or ac-
tivity that conforms with section 2(a) the Im-
proper Payments Information Act of 2002 (31 
U.S.C. 3321 note); and 
(C) if required, publishes improper pay-
ments estimates for all programs and activities
identified under section 2(b) of the Improper 
Payments Information Act of 2002 (31 U.S.C. 
3321 note) in the accompanying materials to 
the annual financial statement; 
(D) publishes programmatic corrective ac-
tion plans prepared under section 2(c) of the 
Improper Payments Information Act of 2002 
(31 U.S.C. 3321 note) that the agency may 
have in the accompanying materials to the an-
nual financial statement; 
(E) publishes improper payments reduction 
targets established under section 2(c) of the 
Improper Payments Information Act of 2002 
(31 U.S.C. 3321 note) that the agency may 
have in the accompanying materials to the an-
nual financial statement for each program as-
sessed to be at risk, and is meeting such tar-
gets; and 
(F) has reported an improper payment 
rate of less than 10 percent for each program 
and activity for which an estimate was pub-
lished under section 2(b) of the Improper Pay-
ments Information Act of 2002 (31 U.S.C. 
3321 note).
(b) ANNUAL COMPLIANCE REPORT BY INSPECTORS 
GENERAL OF AGENCIES.—Each fiscal year, the Inspector 
General of each agency shall determine whether the agen-
cy is in compliance and submit a report on that determina-
tion to— 
(1) the head of the agency; 
(2) the Committee on Homeland Security and 
Governmental Affairs of the Senate; 
(3) the Committee on Oversight and Govern-
mental Reform of the House of Representatives; and 
(4) the Comptroller General. 
(c) REMEDIATION.— 
(1) NONCOMPLIANCE.— 
(A) IN GENERAL.—If an agency is deter-
mined by the Inspector General of that agency 
not to be in compliance under subsection (b) in 
a fiscal year, the head of the agency shall sub-
mit a plan to Congress describing the actions 
that the agency will take to come into compli-
ance. 
(B) PLAN.—The plan described under sub-
paragraph (A) shall include— 
(i) measurable milestones to be ac-
complished in order to achieve compliance 
for each program or activity;
(1) IN GENERAL.—The Director of the Office of 
Management and Budget may establish 1 or more 
pilot programs which shall test potential account-
ability mechanisms with appropriate incentives and 
consequences tied to success in ensuring compliance 
with this Act and eliminating improper payments. 
(2) REPORT.—Not later than 5 years after the 
date of enactment of this Act, the Director of the 
Office of Management and Budget shall submit a re-
port to Congress on the findings associated with any 
pilot programs conducted under paragraph (1). The 
report shall include any legislative or other rec-
ommendations that the Director determines nec-
essary. 
(e) REPORT ON CHIEF FINANCIAL OFFICERS ACT OF 
1990.—Not later than 1 year after the date of the enact-
ment of this Act, the Chief Financial Officers Council es-
tablished under section 302 of the Chief Financial Officers 
Act of 1990 (31 U.S.C. 901 note) and the Council of In-
spectors General on Integrity and Efficiency established 
under section 7 of the Inspector General Reform Act of 
2009 (Public Law 110–409), in consultation with a broad 
cross-section of experts and stakeholders in Government 
accounting and financial management shall—
(1) jointly examine the lessons learned during 
the first 20 years of implementing the Chief Finan-
cial Officers Act of 1990 (31 U.S.C. 901) and iden-
tify reforms or improvements, if any, to the legisla-
tive and regulatory compliance framework for Fed-
eral financial management that will optimize Federal 
agency efforts to— 
(A) publish relevant, timely, and reliable 
reports on Government finances; and 
(B) implement internal controls that miti-
gate the risk for fraud, waste, and error in Gov-
ernment programs; and 
(2) jointly submit a report on the results of the 
examination to— 
(A) the Committee on Homeland Security 
and Governmental Affairs of the Senate; 
(B) the Committee on Oversight and Gov-
ernment Reform of the House of Representa-
tives; and 
(C) the Comptroller General. 
Passed the House of Representatives April 28, 2010. 
Attest: 
Clerk.
111TH CONGRESS 
2D SESSION 
H. R. 3393 
AN ACT 
To amend the Improper Payments Information Act 
of 2002 (31 U.S.C. 3321 note) in order to pre-
vent the loss of billions in taxpayer dollars.