McCaskill & Webb tout bill to reform wartime contracting
Democratic Senators Claire McCaskill (Mo.) and Jim Webb (Va.) joined forces this week to shore up support for SB 2139, “The Comprehensive Contingency Contract Reform Act of 2012.”
Introduced in February, the bill builds on the recommendations presented by the Commission on Wartime Contracting last year.
“This legislation will increase accountability for wartime contracting and transform the way the federal government awards, manages, and oversees wartime contracts,” said McCaskill, who co-sponsored the bill with Webb. “It is not too late to prevent further waste in Afghanistan, and it’s not too late to prevent the problems in Iraq and Afghanistan from occurring in the next war whenever and wherever that may be.”
After a three-year investigation, the commission found that the government lost between $31 billion to $60 billion in Iraq and Afghanistan as a result of contract waste and fraud. To put it another way, between 15% to 30% of the $200 billion spent on wartime contracts since 2002 went to what the commission called “avoidable waste.”
Read more: U.S. wasted billions in wartime contracts
While SB 2139 primarily focuses on improving the government’s planning, oversight, and management of service contracts, the bill also addresses serious issues raised by the commission, such as the controversial use of private security contractors, human trafficking for forced labor and prostitution, contractor accountability, and subcontractor transparency.
However, Webb was quick to point out that the legislation was not intended to “bash wartime contractors” but to hold them accountable for their conduct and performance of services paid for by taxpayers.
“We can’t get along without them,” he explained. “This is…an effort to put the right kind of structure into place so that we can have efficiently-run, well-managed, and effective wartime contracting and operational contingencies now and in the future.”
Overview of reforms proposed in SB 2139
Improving government planning, oversight & management of private contracts:
- Requiring the President to specify the amount requested for war or “overseas contingent operations” (OCO) funding; how the money will be used; where the money will go; and how he is going to pay for the war, whether it is through a tax increase, budget cuts, or borrow money.
- Directing existing Inspectors General of the Defense Department, State Department, and USAID to team up in overseeing private contractors and the IG’s work would be funded through a portion of the OCO budget. While this approach would avoid creating an additional federal bureaucracy, the commission recommended creating a separate, permanent IG office dedicated to overseeing wartime contracting. “The misalignment of organization structures and authorities impedes interagency coordination and cooperation for contingency contracting,” the commission explained. “This misalignment leads to duplication of effort, gaps in continuity, improper phasing of operations, and waste.”
- Requiring the Defense Department, State Department, and USAID to provide more staff training for contract planning and support.
- Requiring risk analyses to be conducted by U.S. officials before seeking private security contracts. This provision is intended to address the controversial use – and reliance – on private security contractors in Iraq and Afghanistan.
- Requiring all service contracts to go through a competitive bidding systems and allowing no-bid contracts only as an “unusual and compelling exception.”
- Requiring all development or reconstruction projects to be certified as “sustainable” – or will be continued after the U.S. withdraws from the country – before awarding private contracts for such projects. This provision was included in response to the commission’s findings that millions were wasted in Iraq and Afghanistan because of “overly ambitious proposals” that failed to account for the host country’s “technical and financial capabilities to operate and maintain” projects. The commission cited Iraq’s intermittently-operated Nassiriya water treatment plant ($300 million) and Afghanistan’s defunct Tarakhil Power Plant ($300 million) as examples of unsustainable projects.
Holding contractors & subcontractors accountable
- Allowing automatic suspensions of private contractors (1) indicted for offenses related to the performance of their contracts, (2) failed to refund money owed to the federal government, or (3) engaged in fraud or other serious misconducts while carrying out their contract obligations. The suspensions may be triggered even if the offenses are committed by an employee, affiliate, or subcontractor of a primary contractor.
- Giving U.S. authorities the authority to bring civil (criminal) charges against private contractors who commit rape, sexual assault, or whose work performances result in the wrongful death of any member of the U.S. Armed Forces, civilian employees of the federal government, or contractors who are U.S. citizens or U.S. nationals. All civil actions will be brought before the U.S. District Court for the District of Columbia.
- Combatting human trafficking of foreign individuals for forced labor and/or prostitution by terminating contracts of prime contractors that hire subcontractors, recruiters, or brokers that engage in human trafficking. According to a 2011 State Department report, workers from Bangladesh, India, Indonesia, Nepal, the Philippines, Sri Lanka, Thailand, Pakistan, Georgia, Jordan, and Uganda often have their passports confiscated by employers and were forced to work as “construction workers, security guards, cleaners, handymen, and domestic workers” without pay in Iraq. Many women from those countries were also forced into sexual slavery or prostitution in Iraq.
- Imposing limits to subcontracting tiers to improve transparency of the subcontractors’ performance and conduct.
- Senate Homeland Security & Government Affairs Committee: Hearing on wartime contracting by the Subcommittee on Contracting Oversight on April 17, 2012
- Senate Homeland Security & Government Affairs Committee: SB 2139 “Comprehensive Contingency Contracting Reform Act of 2012” (PDF)
- Thomas.LOC.gov: SB 2139 “Comprehensive Contingency Contracting Reform Act of 2012”
- State.gov: Trafficking in Persons Report 2011
- WhatTheFolly.com: Wartime commission: reforms needed to prevent future contract waste, fraud & abuse
- WhatTheFolly.com: Iraq & Afghanistan wars proved profitable for a small circle of private contractors
- WhatTheFolly.com: U.S. wasted billions in wartime contracts
- WhatTheFolly.com: U.S. wasted billions on unsustainable wartime contracts in Iraq & Afghanistan
- Commission on Wartime Contracting
- Commission on Wartime Contracting: Press release – Wartime contracting commission releases final report to Congress (PDF)
- Commission on Wartime Contracting: Transforming wartime contracting: controlling costs, reducing risks – 19-page executive summary (PDF)
- Commission on Wartime Contracting: Transforming wartime contracting: controlling costs, reducing risks – full 248-page report (PDF)