Acquisition community faces strict stimulus reporting rules

A series of draft rules published on Tuesday in the Federal Register detail several new reporting requirements for contractors and procurement officials disbursing stimulus funds.

All prime contractors going forward will have to submit detailed public reports to the government on the services they are providing and the jobs they are creating using Recovery Act funds, according to one of the regulations. Another rule would require acquisition officials to publish notices on contracts worth more than $25,000 in a format that's easy for the public to understand before they are awarded.

While the interim rules take effect on March 31, the final regulations will be published this summer after the end of the comment period on June 1.

The proposed requirements are aimed at holding contractors and procurement officials highly accountable for contracts related to the $787 billion stimulus package. They build off the Feb. 18 guidelines by the Office of Management and Budget provided to federal agencies.

Contractors, regardless of size or type of business ownership, will be required to report quarterly on their use of stimulus funds via an online tool being developed at www.federalreporting.gov. The rule applies to contracts at or below the simplified acquisition threshold, generally less than $100,000, and to products available commercially.

Those reports must include the dollar amount of each invoice, the supplies or services delivered, and the timeline for completing the contract. Contractors also have to describe clearly how the stimulus money affects employment, including an estimate of new jobs created and retained as a result of the award.

Less burdensome requirements are imposed on first-tier subcontractors, who only need to report basic information about their DUNS identification number, address and the performance location of the award.

The first reports are due by July 10, and must be submitted thereafter no later than the 10th day after the end of each calendar quarter. Contracting officers will not be responsible for verifying the information in the contractor's report, only that a report was submitted.

The draft rules, however, do spell out additional reporting responsibilities for the procurement workforce.

Acquisition officials must post pre-award notices for all orders exceeding $25,000 that describe the supplies and services requested "in a narrative that is clear and unambiguous to the general public." And they will have to provide a rationale to the public for any contract action -- regardless of dollar amount -- that are not fixed-price and competitive.

The rule applies to contracts awarded using small business set-asides. Awards issued through the General Services Administration's Federal Supply Schedule, however, will be considered competitive and therefore exempt.

A recent Government Executive review of initial contracts issued using Recovery Act funds showed that several agencies were making use of GSA schedules and agency blanket purchase agreements.

Other Recovery Act interim rules issued Tuesday:

-- Prohibit nonfederal employers from firing, demoting or discriminating against whistleblowers who alert the government to questionable uses of stimulus funds. Contractors who refuse to abide by this rule will not be eligible for stimulus contracts. A provision that would have protected federal whistleblowers was removed prior to the passage of the Recovery Act

-- Require that all construction, repair or maintenance projects use only iron, steel and manufactured goods produced in the United States. The rule provides a number of narrow exceptions and waivers, such as cases when goods are not available domestically, or if the local price is not reasonable

-- Provide the Government Accountability Office with the authority to audit both contracts and subcontracts related to the stimulus, and to interview contractor and subcontractor employees. The same rights, except the ability to interview subcontractor workers, are granted to inspectors general. A spokeswoman for Earl Devaney, chairman of the Recovery Accountability and Transparency Board, said the 1978 Inspector General Act "allows IGs to investigate as deep as they need on any issue, and no guidance can trump that."

The federal government estimated that it will award about $80 billion in Recovery Act awards to more than 20,000 prime contractors and 60,000 first-tier subcontractors. Roughly 20 percent of the prime contractors and about 25 percent of the subcontractors will be small businesses, the Federal Register notice said.