“This sends a clear message that the administration needs to clean up the proposed rule before it becomes final or Congress is going to clean it up for them,” Grassley said. “It would be a disservice to taxpayers to exempt overseas contracts when holding bad actors accountable, and it’s a no brainer that this loophole should be rejected.”
The amendment puts the Senate on record that overseas government contracts should be held to the same standards as domestic contracts and sets the stage for future legislation to address the matter if necessary.
Grassley originally introduced a Sense of the Senate resolution to the fiscal 2009 budget resolution, but it was later modified in order to make it germane to the underlying bill. The modification would add language to an account that sets aside funds for future legislation to address waste, fraud, and abuse in Department of Defense contracts. These funds would then allow Congress to legislate that overseas government contracts must be subject to the same requirements as domestic contracts.
Grassley’s amendment responds to a proposed rule issued by the Federal Acquisition Regulatory Council that would otherwise tighten ethics and reporting requirements for federal contractors. The proposed rule contains a loophole that would exempt federal overseas contractors from reporting contract abuse. The Justice Department objected to the loophole for overseas contracts and the Office of Management and Budget is currently reviewing the proposed rule.
Last month Grassley sent a letter to Office of Management and Budget Director Jim Nussle outlining his concerns and urging Nussle to ensure that the exemption is not included in the final rule.
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