ASA Supported Procurement Policies Included in the FY23 NDAA
On December 6, 2022, the FY23 National Defense Authorization Act (NDAA) was released and included in it was ASA supported procurement policies regarding progress payments, cash flow, military base access, PFAS, architectural and engineering services, and wastewater assistance. Our top priority for this year’s bill was change order reform, but unfortunately the final bill did not address such reform. In July, Reps. Peters (D-CA) and Stauber (R-MN), the co-chairs of the Congressional Procurement Caucus, addressed change order reform by introducing H.R. 8273, the “Small Business Payment Performance Act.” This legislation was included as an amendment to the House version of the FY23 NDAA and it would assist small business construction contractors receive timely payment for change orders. Construction firms of all sizes, but especially small businesses, have had to weather the effects of the pandemic and soaring construction materials costs. This commonsense and bipartisan legislation would help ensure that our nation's small business construction contractors do not go bankrupt waiting to be paid for work the federal government ordered them to perform. We will continue to make change order reform a priority in the 118th Congress.
ASA supported the following exclusions to the FY23 NDAA:
- Senate Sec. 827 – This section would dramatically change the long-established system for progress payments and proposes an unworkable formula that will harm federal procurement, needlessly draw out project close times, and seriously risks harming flow-down payments to subcontractors and small businesses. On page 214 of the legislation, it states that the Defense Department has already commissioned an independent study to evaluate financing mechanisms available in the Department’s contracting toolbox to improve the effectiveness and efficiency of cash flow in the defense sector.
- House Sec. 868 and House Sec. 5817 – These sections create new Blacklisting requirements for contractors similar to Fair Pay and Safe Workplaces (E.O. 13673) that Congress stopped from being implemented. These sections would usurp long established existing rules for debarment and suspension, and blunt bureaucratic solutions for which there is a lack of statistically significant evidence of a systemic problem. The Federal Acquisition Regulation (FAR) already provides a number of avenues – like suspension or debarment – for federal agencies to deal with “bad actors” that willfully or repeatedly violate the law. Federal agencies already have broad discretion to suspend or debar contractors for a wide range of improper conduct indicating a lack of business integrity. Apparently, efforts are underway by the Acquisition Innovation Research Center (AIRC) to share information between agencies.
- House Sec. 2825 – This section attempts to correct a significant issue of non-standardized base access that causes inefficiencies leading to loss of taxpayer dollars, but the section has key deficiencies that risks making the issue worse. For example, one of the many challenges with military construction projects located on a base is getting large delivery trucks access to drop off construction materials. Under this section if a delivery driver traveled across the country to deliver materials to a base that driver would be unable to make such a delivery unless the driver is deemed fit to enter after a screening not less than 24 hours and not more than 14 days. In response to this section, the Defense Department is already looking how to improve base access.
- House Sec. 2882 – This section is largely duplicative of established law and U.S. Army Corps of Engineers policy, but also adds the risk of publishing federal contractors’ proprietary information. The section requires the Army Corps to investigate worker and third-party complaints, certify payrolls, and make such payroll information publicly available.
- House Sec. 5851 – This section would impose unnecessary reporting burdens on many American businesses and threatens the privacy of law-abiding, legitimate small business owners. It would also create significant liability risk for federal contractors for violating minor paperwork requirements related to “beneficial ownership” that can be challenging for business owners to comply.
- House Sec. 5883 – This section takes a one-size-fits-all approach to PFAS that predetermines outcomes ahead of EPA’s review of the science and engagement in the regulatory process. The section would redirect resources away from EPA’s prioritized efforts to address specific types of PFAS and risks diluting current EPA efforts to set consistent, scientific, risk-based standards to address potential impacts related to those PFAS.
ASA requested the inclusion of the following:
- Senate Sec. 823 – This section would provide flexibility when requesting qualification for architectural and engineering services on a task or delivery order.
- House Sec. 5899 – This section reauthorizes the Wastewater Assistance to Colonias program and increases program funding to $100,000,000 for the planning, design, and construction or improvement of sewers, treatment works, and appropriate connections for wastewater treatment to eligible communities for each of the fiscal years 2023 through 2027. Increase the amount of grants awarded to not less than 80 percent of the costs of carrying out the projects that is subject to the grants.