Contractors and Federal Spending Accountability Act of 2008

April 29 2008

Legislative Affairs

The federal Government is the world’s largest purchasing department. Prudent fiscal managers and government anti-fraud officials have long recognized they should keep better track of the legal compliance of the companies they do business with. They need legislative support and funding to create the information database on legal compliance the law requires. Taxpayer fiscal responsibility demands nothing less.

As contractors that invest handsomely in legal compliance, we know the taxpayers would be better served by weeding out marginal firms that cut corners, violate the law, and deprive agencies and the taxpayers of top-flight performance. Those who oppose the law with fine points on what action is “concluded” are raising red herrings – the law does NOTHING to change the current Federal Acquisition Regulations on deciding whether a firm is responsible to be awarded a contract. REPEAT – IT CHANGES NOTHING ABOUT THE CONTRACT ELIGIBILITY DETERMINATION CRITERIA. It merely requires the compilation of performance information in the same way that is common in responsible private procurement policy making. (See Construction industry ConsensusDOCS prequalification forms, for example.)

The law requires Contracting Officers to check the database before awarding the contract – merely formalizing the already-required contractor responsibility determination process. If there are repeat legal violations within three years – each of which themselves would warrant debarment under the current FAR rule – then, the CO must document the responsibility determination decision. Again, there is no presumption of ineligibility or non-responsibility – the CO’s discretion and authority remain undisturbed as they exist in the FAR now – it merely gives the CO more complete information.

Congress should enact H.R. 3033 quickly, to close the gaping hole in sound Federal fiscal management. Congress should just as quickly also repeal more slap-dash and haphazard enactments designed to address the problems cause by lack of more scrupulous procurement judgments — primarily the misguided 3% withholding tax on public contracts to make up for awarding contracts to tax cheats.

The House and Senate, after passing H.R. 3033, should then quickly enact H.R. 1023,and S. 777, that would avoid penalizing tax complaint public contractors with an unjustified new across-the-board tax withholding and at the same time cost procurement agencies vastly more in unfunded administrative costs than any revenue it would bring in.

SUPPORT H.R. 3033; THEN REPEAL the 3% withholding tax, ENACT H.R. 1023, and S. 777.

The Campaign for Quality Construction….
Todd Mustard, The Association of Union Constructors (TAUC)
Matt Aquiline, International Council of Employers of bricklayers and Allied Craftworkers (ICE)
Lake Coulson, National Electrical Contractors association (NECA)
Stan Kolbe, Sheet Metal and Air Conditioning Contractors’ National Association (SMACNA)
John McNerney, Mechanical Contractors Association of America (MCAA)
Jay Weaver, Finishing Contractors Association (FCA)