[Senate Report 111-192]
[From the U.S. Government Publishing Office]
111th Congress
2nd Session SENATE Report
111-192
_______________________________________________________________________
Calendar No. 379
FEDERAL SUPPLY SCHEDULES USAGE ACT OF 2009
__________
R E P O R T
of the
COMMITTEE ON HOMELAND SECURITY AND
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
to accompany
S. 2868
TO PROVIDE INCREASED ACCESS TO THE GENERAL SERVICES ADMINISTRATION'S
SCHEDULES PROGRAM BY THE AMERICAN RED CROSS AND STATE AND LOCAL
GOVERNMENTS
May 17, 2010.--Ordered to be printed
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 GEORGE V. VOINOVICH, Ohio
CLAIRE McCASKILL, Missouri JOHN ENSIGN, Nevada
JON TESTER, Montana LINDSEY GRAHAM, South Carolina
ROLAND W. BURRIS, Illinois
EDWARD E. KAUFMAN, Delaware
Michael L. Alexander, Staff Director
Kevin J. Landy, Chief Counsel
Troy H. Cribb, Counsel
Paula Haurilesko, GAO Detailee
Brandon L. Milhorn, Minority Staff Director and Chief Counsel
Molly A. Wilkinson, Minority General Counsel
Eric B. Cho, Minority GSA Detailee
Trina Driessnack Tyrer, Chief Clerk
C O N T E N T S
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 to Existing Law Made by the Bill, as Reported............6
Calendar No. 379
111th Congress
SENATE
Report
2d Session 111-192
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FEDERAL SUPPLY SCHEDULES USAGE ACT OF 2009
_______
May 17, 2010.--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. 2868]
The Committee on Homeland Security and Governmental
Affairs, to which was referred the bill (S. 2868) to provide
increased access to the General Services Administration's
Schedules Program by the American Red Cross and State and local
governments, having considered the same, reports favorably
thereon without amendment and recommends that the bill do pass.
I. Purpose and Summary
S. 2868 seeks to enhance the ability of the American
National Red Cross (``American Red Cross'') and state and local
governments to effectively prepare for and respond to disasters
by giving them the ability to purchase certain goods and
services through pre-negotiated contracts established under the
General Services Administration's (GSA) Federal Supply
Schedules (FSS) program. This procurement authority will help
the American Red Cross and state and local governments reduce
the administrative costs of negotiating their own contracts by
authorizing them to use the pre-negotiated contracts of GSA.
II. Background and Need for the Legislation
The GSA FSS program is also known as the GSA Schedules or
Multiple Award Schedules program. The FSS program enables
federal agencies to purchase goods and services under contracts
that GSA has pre-negotiated. These contracts cover more than 11
million commercial goods and services and are listed in broad
categories known as schedules. GSA pre-negotiates the terms and
conditions of the contract, including discounted prices. The
discounts result from the ability of the federal government,
like many other buyers who purchase large volumes of goods and
services, to use its buying power to negotiate long-term
contracts with suppliers seeking access to the large federal
market. Federal agencies--and non-federal entities, as
permitted--can place orders under FSS contracts, thus
streamlining the acquisition process and reducing time and
administrative costs associated with negotiating and awarding
contracts. Use of the FSS contracts is voluntary for both
purchasers and sellers. Non-federal entities, when authorized
to use the Federal Supply Schedules for a specific purpose, are
not required to do so; likewise, companies holding FSS
contracts are not required to offer goods and services under
them to non-federal entities. Nevertheless, most FSS vendors
choose to offer their goods and services to non-federal
entities under their FSS contracts, when authorized to do so,
in order to reach a larger market.
THE AMERICAN RED CROSS
The American Red Cross is the largest nongovernmental
provider of disaster response services in the United States.
Congress first chartered the organization in 1900. The current
charter, codified in 2007,\1\ tasks the American Red Cross with
providing volunteer aid in time of war to the sick and wounded
of the armed forces; facilitating communication between members
of the armed forces and U.S. citizens\2\; providing national
and international relief to mitigate suffering caused by
disasters; helping prevent disasters; and conducting other
activities consistent with these purposes.\3\
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\1\Pub. L. 110-26, May 11, 2007.
\2\Through local chapters and call centers, the American Red Cross
relays information related to family emergencies to service members
stationed around the world.
\3\36 U.S.C. Sec. Sec. 300101-300111.
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The American Red Cross spends millions of dollars each year
to assist Americans impacted by disasters large and small, to
provide aid to members of the U.S. armed forces serving
overseas, as well as to provide assistance when overseas
disasters strike. For example, during 2009, the American Red
Cross provided shelter, food, clothing, and other supplies to
victims of flooding in Georgia, North Carolina, Alabama and
Tennessee, and sheltered evacuees from the California
wildfires. The American Red Cross provided disaster relief in
American Samoa, giving things such as cots, flashlights, and
cooking and clean-up supplies to victims of the earthquake and
tsunami that struck on September 29, 2009; and it helped to
rebuild homes after the 2008 earthquake in Sichuan, China. The
American Red Cross also provides items such as clothing,
furniture, and supplies to members of the U.S. military and
their families at hospitals and Warrior Transition Units, which
provide critical support to wounded soldiers who are expected
to require at least six months of rehabilitative care and
complex medical management.
The American Red Cross has long had access to FSS, but
since 2001 GSA has interpreted the law giving that access--the
Foreign Assistance Act of 1961\4\--as authorizing only
purchases related to international relief efforts.\5\ For the
last and current fiscal year, provisions in appropriations Acts
have given the American Red Cross authority to use FSS purchase
supplies and services for its disaster-related domestic
work.\6\ S. 2868 would make that authority permanent by
authorizing the American Red Cross to use FSS to purchase
supplies and services to serve any of the purposes authorized
under its congressional charter.
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\4\Pub. L. 87-195 Sec. 607, as amended, 22 U.S.C. 2357.
\5\From 1992 until 2001, GSA interpreted the language in that Act
to permit the American Red Cross to use the Federal Supply Schedules
for all of its work, regardless of whether the work was foreign or
domestic. In 2001, however, GSA re-interpreted the Act to limit
American Red Cross usage of FSS to supporting only overseas activities.
Letter from G. Martin Wagner, Associate Administrator, GSA, to Mr. John
D. Campbell, Chief Financial Officer, American Red Cross, December 26,
2001.
\6\Pub. L. 111-8 Sec. 517; Pub. L. 111-117, Div. C, Title V,
Sec. 516.
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The bill makes clear, however, that the American Red
Cross's access to FSS is limited to purchasing goods and
services specifically in support of purposes stated in the
congressional charter. It may not, for example, purchase
pharmaceuticals or equipment and supplies for its blood supply
services mission. In addition, the bill explicitly prohibits
purchasing from FSS for resale.
The American Red Cross has in recent years suffered from
financial difficulties. In response to the American Red Cross's
financial problems during the 2008 disaster season caused by
increased disaster activity and lower contributions due to the
recession, Congress in 2009 provided $100 million to reimburse
the American Red Cross for disaster relief and recovery
expenditures and emergency services for disasters that occurred
during 2008.\7\ The American Red Cross's financial situation
has recently started to improve; its financial statement for
fiscal year 2009, which ended in June 2009, indicates that the
American Red Cross ended year with a $33.5 million operating
deficit, a significant improvement over its $209 million
operating deficit in fiscal year 2008. The ability to make
additional purchases using the Federal Supply Schedules to
support members of the armed forces and to stockpile supplies
in advance of disasters will stretch American Red Cross dollars
further and help it continue to improve its operating finances.
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\7\Consolidated Security, Disaster Assistance, and Continuing
Appropriations Act, 2009, Pub. L. 110-329, Div. B, Title I, Chapter 5,
Sec. 10502.
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STATE AND LOCAL GOVERNMENTS
State and local government entities currently are eligible
to purchase certain goods and services using FSS contracts
under several authorities.
Under the Cooperative Purchasing Program, state and local
governments are permitted to purchase selected information
technology products and services using FSS contracts.\8\ State
and local government entities may also purchase alarm and
signal systems, facility management systems, firefighting and
rescue equipment, law enforcement and security equipment,
marine craft and related equipment, special purpose clothing,
and related services.\9\
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\8\The authority to purchase information technology products was
granted under the E-Government Act of 2002, Pub. L. 107-347 Sec. 211.
\9\Authorized by the Local Preparedness Acquisition Act, Pub. L.
110-248.
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The 1122 Program--so called because it is authorized by
section 1122 of the fiscal year 1994 National Defense
Authorization Act--permits states and units of local government
to purchase law enforcement equipment through federal
procurement channels, provided that the equipment is used in
the performance of counter-drug activities.
Under the Disaster Recovery Purchasing Program, state and
local governments have been authorized since 2007 to purchase
goods and services to facilitate recovery from a major disaster
that has been declared by the President under the Robert T.
Stafford Disaster Relief and Emergency Assistance Act\10\ or to
facilitate recovery from terrorism or nuclear, biological,
chemical, or radiological attack.\11\
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\10\Pub. L. 100-707.
\11\The authority was granted by section 833 of the John Warner
National Defense Authorization Act for Fiscal Year 2007, Pub. L. 109-
364.
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In addition to these three programs, in August 2009 the
Administrator of GSA, under GSA's general authorities,\12\
granted state, local, territorial, and tribal governments
access to FSS to purchase goods and services when expending
federal grant funds in response to Public Health Emergencies
declared by the Secretary of Health and Human Services under
section 319 of the Public Health Services Act.\13\
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\12\40 U.S.C. 501 grants the Administrator of GSA general
authorities to take actions advantageous to the economy, efficiency or
service of the government, and to procure and supply personal property
and nonpersonal services for executive agencies to use in the proper
discharge of their responsibilities.
\13\Codified at 42 U.S.C. Sec. 247d.
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However, none of these programs permit state and local
governments to purchase goods and services to help prepare for
disasters in advance of a disaster declaration, and there is no
specific statutory authority related to disaster response.\14\
This bill will rectify these omissions, thus permitting state
and local governments to reduce time and resources spent on
negotiating and awarding contracts for needed goods and
services by purchasing through the Federal Supply Schedules for
these activities.
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\14\Disaster response refers to the actions taken immediately after
a disaster; recovery refers to the longer-term effort to rebuild the
infrastructure. Response and recovery efforts can occur simultaneously.
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III. Legislative History
On December 10, 2009, S. 2868 was introduced by Senator
Lieberman and referred to the Senate Committee on Homeland
Security and Governmental Affairs. On December 16, 2009, the
Committee favorably reported S. 2868, without amendment, by
voice vote. Members present for the vote on the bill were
Senators Lieberman, Akaka, Carper, Pryor, McCaskill, Tester,
Burris, Kirk, and Collins. On January 20, 2010, Senator Carper
became a cosponsor of the bill.
IV. Section-by-Section Analysis
Section 1. Short title
Section 1 designates the name of the act as the ``Federal
Supply Schedules Usage Act of 2009.''
Section 2. Use of Federal Supply Schedules by the Red Cross
Section 2 adds a new subsection to 40 U.S.C. Sec. 502. It
authorizes the General Services Administration to grant the
American Red Cross access to the Federal Supply Schedules to
purchase goods and services in support of the purposes
authorized by the American Red Cross's federal charter under 36
U.S.C. Sec. 300102. Section 2 prohibits the American Red Cross
from reselling goods and services purchased through Federal
Supply Schedule contracts.
Section 3. Duty of users regarding use of supply schedules
Section 3 adds a new subsection to 40 U.S.C. Sec. 502. The
new subsection will impose a positive duty upon all users of
the Federal Supply Schedules, both federal and non-federal, to
act in accordance with the guidance on placing orders under the
Federal Supply Schedules that GSA provides.
Section 4. Authority of State and local governments to use supply
schedules for certain goods and services
Section 4 amends 40 U.S.C. Sec. 502(d) to permit state and
local governments to use the Federal Supply Schedules to
purchase goods and services for the purpose of disaster
preparation and response. Section 502(d) already permits state
and local governments to use the Federal Supply Schedules to
purchase goods and services to facilitate recovery from a major
disaster that has been declared by the President under the
Robert T. Stafford Disaster Relief and Emergency Assistance Act
or to facilitate recovery from terrorism or nuclear,
biological, chemical, or radiological attack.
V. Evaluation of Regulatory Impact
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 this 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 effect state, local,
and tribal governments. The enactment of this legislation will
not have significant regulatory impact.
VI. Congressional Budget Office Cost Estimate
December 23, 2009.
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. 2868, the Federal
Supply Schedules Usage Act of 2009.
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. 2868--Federal Supply Schedules Usage Act of 2009
S. 2868 would amend federal law to allow the American Red
Cross, as well as state and local governments, to use the
federal supply schedules of the General Services Administration
to procure goods and services from private firms for disaster
preparedness and response activities. Because the legislation
would codify and clarify current policy and practice, CBO
estimates that implementing S. 2868 would have no significant
impact on the federal budget. Enacting the bill would not
affect direct spending or revenues. S. 2868 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.
The CBO staff contact for this estimate is Matthew
Pickford. The estimate was approved by Theresa Gullo, Deputy
Assistant Director for Budget Analysis.
VII. Changes to Existing Law Made by the Bill, as Reported
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
S. 2868 as reported are shown as follows (existing law proposed
to be omitted is enclosed in brackets, new matter is printed in
italic, and existing law in which no change is proposed is
shown in roman):
TITLE 40--PUBLIC BUILDINGS, PROPERTY, AND WORKS
Subtitle I--Federal Property and Administrative Services
CHAPTER 5--PROPERTY MANAGEMENT
Subchapter I--Procurement and Warehousing
* * * * * * *
Sec. 502. Services for other entities
(a) * * *
(b) * * *
(c) * * *
(d) Use of Supply Schedules for Certain Goods and
Services.--
(1) In general.--The Administrator may provide for
the use by State or local governments of Federal supply
schedules of the General Services Administration for
goods or services that are to be used to facilitate
recovery from a major disaster declared by the
President under the Robert T. Stafford Disaster Relief
and Emergency Assistance Act (42 U.S.C. 5121 et seq.),
to facilitate disaster preparedness or response, or to
facilitate recovery from terrorism or nuclear,
biological, chemical, or radiological attack.
(2) * * *
(3) * * *
(4) * * *
(e) Use of Supply Schedules by the Red Cross.--
(1) In general.--The Administrator may provide for
the use by the American National Red Cross of Federal
supply schedules. Purchases under this authority shall
be used in furtherance of the purposes of the American
National Red Cross set forth in section 300102 of title
36, United States Code.
(2) Limitation.--The authority under this subsection
may not be used to purchase supplies for resale.
(f) Duty of Non-Federal Users Regarding Use of Federal
Supply Schedules.--All users of Federal supply schedules,
including non-Federal users, shall use the schedules in
accordance with the ordering guidance provided by the
Administrator of General Services.