COST OVERRUNS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP86B00338R000200230018-8
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 10
• Document Creation Date: December 21, 2016
• Document Release Date: October 21, 2008
• Sequence Number: 18
• Publication Date: February 25, 1983
• Content Type: REPORT

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LEGISLATIVE ANALYSIS
Bill No.
S.
421
Title;
none
Subject;
cost overruns
4)
Amends.
freestanding
frAvor
Report No. Companion No.
Conclusion: (f No Agency objection
ler Agency objection and/or needs amendment
Analysis: This bill would establish a system whereby the head of
each executive agency reports to the Comptroller General on all procurements
over $50M. The report would include the purpose of the procurement and
initial cost data for it; there would be periodic rereporting.
Whenever the Comptroller General determined that actual cost was
exceeding initial cost by 25%, all work on the procurement would have
to stop unless the Congress passed a law authorizing work to commence
.again in view of the higher actual cost level.
The Agency would have two objections to this bill: 1) requirement
that sensitive information be divulged; 2) burdensome intervention in
the procurement process.
It does not appear, however, that this bill will see any action.
If it does, then we will have to detemrine what steps to take to insure
that the objectionable provisions are removed.
STAT
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2 5 .-cB 1983
98TH CONGRESS
1ST SESSION
S.421
To require the Comptroller General of the United States to ascertain increases in
the cost of major acquisition programs of the civilian agencies of the execu-
tive branch; to limit the obligation and expenditure of Federal funds to carry
out any major civil acquisition program after there has been a major increase
in the cost of such civil acquisition program until enactment of a law
providing new authority to carry out such civil acquisition program, and for
other purposes.
SENATE OF THE UNITED STATES
RUARY 3 (legislative day, JANUARY 25), 1983
/~,
Mr.l/t'RO%MIRE r himself, Mr. PRYOR, and Mr. JEPSEN) introduced the follow-
, which was read twice and referred to the Committee on Governmen-
A BILL
To require the Comptroller General of the United States to
ascertain increases in the cost of major acquisition programs
of the civilian agencies of the executive branch; to limit the
obligation and expenditure of Federal funds to carry out any
major civil acquisition program after there has been a major
increase in the cost of such civil acquisition program until
enactment of a law providing new authority to carry out
such civil acquisition program, and for other purposes.
1 Be it enacted by the Senate and House of Representa-
2 tives of the United States of America in Congress assembled,
3 That for the purposes of this Act-
STAT
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1 (1) the term j shall have the same mean-
2 ing as provided in sections
3
4 (2) the term "civil acquisition program" means
5
6 (other than a construction, acquisition, or procurement
7 program of the Department of Defense),.
9 l;
10 (3) the term "Comptroller General" means the
11 Comptroller General of the United States;
12 (4) the term "Federal funds" includes funds pro-
13 vided by the Federal Government by grant, but does
14 not include funds allocated to any State or political
15 subdivision thereof under chapter 67 of title 31, United
16 States Code, or any similar law;
17 (5) the term "initial cost estimate", when used
18 with respect to a civil acquisition program, means the
19 estimated total cost of such civil acquisition program
20 on the basis of which the Congress enacts a law
21 authorizing the appropriation of funds, or, if enacted
22 first, a law appropriating funds, for the first time for
23 such civil acquisition program; and
24 (6) the term `
25 means any
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1
nd (B) is
2
estimated to require an eventual total expenditure (in-
3
cluding expenditures for research, development, test,
4
and evaluation related to such program)
5
6
SEC. 2. (a) The
shall be responsi-
f
r
7 bl
e
o
8
am and
n such in-
9 creases. Such statistics shall be compiled from data submitted
10 to the Comptroller General under section 3 and from data
11 collected by the Comptroller General in the process of carry-
12 ing out audits and reviews authorized by law.
13 SEC. 3. Thf
14 MID'sh
15 General, at such times as the Comptroller General shall re-
i
h
S
16 qu
re,
report
uc
17
shall include-
18
(1) a
of such civil acquisition program
19
20
der such civil acquisition pro-
21
gram and the expectations for the performance of such
22
property;
23
(2) theme
a for such civil acquisi-
24
tion program;
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1 (3) th such civil acquisi-
2 tion program as of the date on which such report is
3 transmitted to the Comptroller General;
4 (4) th funds
5 appropriated, and funds obligated for such civil acquisi-
6 tion program prior to the date on which such report is
7 transmitted;
8 (5)(A) the estimated or actual date of completion
9 of such civil acquisition program as of the end of such
10 fiscal year; and
11 (B) the date by which such civil acquisition pro-
12 gram was planned to be completed when the civil ac-
13 quisition program commenced;
14 (6) in the case of any such civil acquisition pro-
15 gram for which the estimated or actual completion date
16 is more than six months after the date by which such
17 civil acquisition program was planned to be completed
18 when the civil acquisition program commenced, the
19 reasons that such civil acquisition program will not be
20 completed or was not completed by the planned com-
21 pletion date;
22 (7) the quantity or size of the prop-
23 erty to be acquired under such civil acquisition pro-
24 gram from the quantity or size originally planned to be
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1 acquired when the civil acquisition program com-
2 menced, and the reasons for each such change;
3 (8) the reasons for any actual or projected in-
4 crease in the total cost of such civil acquisition pro-
5 gram by 25 per centum or more over the initial cost
6 estimate for such civil acquisition program; and
7 (9) actions taken or proposed to be taken to con-
8 trol subsequent increases in the cost of such civil acqui-
9 sition program.
10 SEC. 4. (a)(1) der the ra r-
11 MOM in the case of any major civil acquisition program that
12 the MMWost of such civil acquisition
13 progra ate of such civil acquisi-
14 tion program~n or more, the Comptroller
15 General
16 ( f the determination
17 - carrying out such civil acquisition program; and
18
19
(B)
20 (2) The report transmitted under paragraph (1) shall in-
21 clude-
22 (A) a statement of the reasons for the increase in
23 the actual or estimated total cost of such civil acquisi-
24 tion program;
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1 (B) all actions taken or proposed to be taken to
2 control subsequent increases in the cost of such civil
3 acquisition program;
4 (C) each change made in the schedule milestones
5 or in any estimates of the quantity of the property that
6 the agency is acquiring under such civil acquisition
7 program and a description of the extent to which such
8 changes have contributed to the increase in the actual
9 or estimated total cost of such civil acquisition pro-
10 gram; and
11 (D) an index of all testimony and documents for-
12 mally provided to the Congress on the estimated total
13 cost of such civil acquisition program.
14
15
16
17 or expended on such civil acquisition program after the date
18 on which the head of the agency carrying out such civil ac-
19 quisition program receives such notice
20
21 (c) The law referred to in subsection (b) means a law
22 which (1) contains only provisions which provide authority to
23 obligate and expend funds on a major civil acquisition pro-
24 gram to which subsection (b) applies, (2) provides such au-
25 thority for a period of not more than one year beginning on
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1 the date of enactment of such law, and (3) is enacted after
2 the date on which the head of the agency referred to in sub-
3 section (b) receives the notice referred to in such subsection.
4 SEC. 5. The Comptroller General shall develop and im-
5 plement policies and procedures applicable to all agencies for
6 reflecting the effects of general economic inflation on cost
7 data reported to the Comptroller General under section 3.
8 SEC. 6. This Act shall not apply in the case of any
9 major civil acquisition program for which funds have been
10 appropriated prior to the date of enactment of this Act.
0
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S 989
got hung up on a minor amendment ally, the bill will continue the exemp-
during the closing hours of the hectic tion of per capita payments from lia-
lameduck session. bility for payment of any previously
The bill I am introducing today is contracted obligation, now provided by
identical to the legislation that passed 30 Stat. 502 which will be repealed.
the Senate last December 22, which Any funds distributed per capita
except for the addition of the minor would also be subject to section 7 of
amendment suggested by the adminis- the Indian Judgment Funds Act of Oc-
tration, is as it was passed by the tober 19, 1973, as amended. Judgment
House earlier in the 97th Congress. fund settlements specifically executed
The administration amendment, clari- under the 1973 Indian Judgment Fund
fying the Federal protection of judg- Act, however, would not be effected
ment fund distributions for minors except to permit their possible tribal
and incompetents, created a small dis- distribution. Where a tribe has elected
crepancy between the Senator and to make its own per capita income dis-
House versions which the House, due tribution, the Secretary shall not be
to the lateness of the hour, did not liable for such distributions.
have an opportunity to accept before Mr. President, I ask unanimous con-
adjournment. I am informed that the sent that the text of this bill be print-
House has no objection to this small ed in the RECORD.
administration amendment, which has There being no objection, the bill
no effect on the substance of the bill. was ordered to be printed in the
With last Congress version of this leg- RECORD, as follows:
islation having received the adminis-
tration's support and having passed 5.419
both the House and Senate, I look for- Be it enacted by the Senate and House of
ward to the smooth and rapid passage Representatives of the United States of
and enactment of today's bill. America in Congress assembled, That funds
The need for this legislation first which are held in trust by the Secretary of
came to light several years ago when the Interior (hereinafter referred to as the
the confederated tribes of the Warm are te to be distributed y") r Indian tribe and which
Springs Reservation of Oregon began of that tribe per r capita to members
tmay be so distributed by either
issuing tribal income per capita pay- the Secretary or, at the request of the gov-
ments to their members on tribal erning body of the tribe and subject to the
checks. Initially, this development was approval of the Secretary, the tribe. Any
welcomed by the local agency of the funds so distributed shall be paid by the
Bureau of Indian Affairs, which previ- Secretary of the tribe directly to the mem-
ously had been hand typing the distri- bers involved or, if such members are
buttons on green Government checks minors or have been legally determined not
competent to handle their own affairs, to a
as the money was drawn out of the parent or guardian of such members or to a
confederated tribes' Federal trust ac- trust fund for such minors or legal Incompe-
count. The Federal employees had tents as determined by the governing body
been using data provided by the con- of the tribe.
federated tribes to issue the checks SEC. 2. (a) Funds distributed under this
anyway, and the tribes' automated Act shall not be liable for the payment of
system was much quicker. Further, previously contracted obligations except as
and perhaps more importantly, the may be provided by the governing body of
tribal checks allowed the funds it; he the tribe and distributions of such funds
shall be subject to the provisions of Section
properly recognized in the surround- 7 of the Act of October 19, 1973 (87 Stat.
ing communities as income beir, n t;;6), as amended.
erated by the confederated tri - 1 ; h) Nothing in this Act shall affect the re-
not mistaken as some Feder olirements of the Act of October 19, 1973
out. So, as a matter of relit ,87 Stat. 466), as amended, or of any plan
Federal administration approved thereunder, with respect to the
burden and expense, and as use or distribution of funds subject to that
pie of tribal capability and Iere , ii self- Act: Provided, That per capita payments
determination, as well as a matter of that made Act pursuant
be to a
be under
made plby an an approved
ian
rightful recognition and price, the provided in Section f this Indian tribe er
tribes' issuing their own check6 was a provisions provides of the 19 the 19173 oft Act are Act met, , all includother
uding
ing
beneficial practice. but not limited to, the protection of the in-
However, before too long, the prac- terests of minors and incompetents to such
tice had to be stopped. It was found funds-
that existing Federal statutes at 29 (c) Nothing in this Act, except the provi-
Stat. 336 and 30 Stat. 502 specifically sloes of Subsection (a) of this section, shall
require that per capita payments of apply to the Shoshone Tribe and the Arapa-
tribal funds be carried out by Federal hoe Tribe of the Wind River Reservation,
officials. These laws were enacted in a Wyoming.
time when tribes were unable to ad- trop, esac.st tabblillsh The
reasonable amble standards s for the
r the
minister and account for such dis- approval of tribal payments pursuant to
bursements. Today, these laws can Section 1 of this act and, where approval is
prove to be an unnecessary hindrance, given under such regulations, the United
The bill I am introducing today will States shall not be liable with respect to any
repeal those two sections and permit distribution of funds by a tribe under this
either by the Secretary of the Interior
or, at the election of the tribe and
with the approval of the Secretary, by
the tribal government itself. Addition-
agreements between the United States and
any Indian tribe.
Sac. 4 (a) The following provision of Sec-
tion 1 of the Act of June 10, 1896 (29 Stat.
3360), is repealed: "That any sums of money
hereafter to be paid per capita to individual
Indians shall be paid to said Indians by an
officer of the Government designated by
the Secretary of the Interior."
(b) Section 19 of the Act of June 28, 1898
(30 Stat. 502), is repealed..
By Mr. PROXMIRE (for him-
self, Mr. PRYOR, and Mr.
JarsEN):
S. 421. A bill to require the Comp-
troller General of the United States to
ertain increases in the cost of
major acquisition programs of the ci-
vilian agencies of the executive
branch; to limit the obligation and ex-
penditure of Federal funds to carry
out any major civil acquisition pro-
gram after there has been a major in-
crease in the cost of such civil acquisi-
tion program until enactment of a law
providing new authority to carry out
such civil acquisition program, and for
other purposes; to the Committee on
Governmental Affairs.
CIVILIAN COST OVNRRUNS
Mr. PROXMIRE. Mr. President,
today Senators PRYOR, JEPSnN, and I
are introducing a bill to stop cost over-
runs on nondefense Government proj-
ects. This country's major public
works projects have been allowed to
run over their estimated cost without
restraint, and without justification to
Congress.
This bill requires that money to a
project be shut off when that project
costs 25 percent or more than it was
estimated to cost initially. My bill will
adjust the initial cost estimate to ac-
count for inflation. It will not apply to
projects whose costs have risen no
higher than the inflation rate. Money
will be restored to a project only after
Congress holds hearings and passes
special legislation to get the project
going again.
A look at the April 1982 General Ac-
counting Office report explains the
need for this legislation. The report
included information on 234 non-De-
fense Department projects either in
development or under construction.
The initial cost-the figure that Con-
gress was given before It approved the
projects-was $39.1 billion. The total
cost of what it will take to complete
those projects is now $106.1 billion-an
increase of 173 percent.
GAO did not know how much of this
cost growth resulted from inflation,
but this bill requires that inflation be
taken into account. GAO did report,
however, that 186 of those projects-
more than half-were 25 percent over
their initial estimated cost. And one-
third will need 100 percent more
money to be completed.
solve the United States from any other re- ably has a reason why it will cost 87
sponsibility to the Indians, including those percent more to bring flood control to
which derive from the trust relationship the Yazoo River than Originally
and from any treaties, Executive orders, or thought. And the Veterans' Adminis-
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CONGRESSIONAL RECORD - SENATE February 3, 1983
tration could probably explain in
detail why its medical clinic in Little
Rock is costing $69 million more to
build. But no law automatically re-
quires those agencies to justify the
overruns or stand back and examine
the projects In light of their escalated
cost. This bill does.
The GAO has urged better reporting
and monitoring of Government proj-
ects as a means to quell cost growth.
Growth would be controlled by this
bill because initial estimates on proj-
ects would be more accurate. Esti-
mates are often low or optimistic be-
cause the agency knows it has a better
chance of getting the project ap-
proved. And as it stands now, few proj-
ects that are approved are stopped, no
matter how high costs rise.
This bill provides an incentive for
agencies to submit realistic cost esti-
mates, because the agencies know as
soon as they spend 25 percent or more
above their estimates, their projects
will come to a halt.
Mr. President, I am talking about
constant dollars, a genuine cost over-
run and not one caused by inflation.
The Comptroller General would be re-
sponsible for accumulating statistics
on the cost of civil projects. When any
project runs over the 25-percent limit,
the Comptroller General would have
the power to notify Congress and the
agency responsible. From that point
on, the money stops until Congress
gives the go ahead.
The word must go out to agencies
that projects cannot run wild. This bill
will help discipline Federal spending
and also provide Congress with a
check list of projects whose costs are
rising rapidly.
Mr. President, I ask unanimous con-
sent that the bill be printed in the
RECORD.
There being no objection, the bill
was ordered to be printed in the
RECORD, as follows:
S. 421
Be it enacted by the Senate and House of
Representatives of the United States of
America in Congress assembled, That for
the purposes of this Act-
(1) the term "agency" shall have the same
meaning as provided in section 551(a) of
title 5, United States Code;
(2) the term '.'civil acquisition program"
means any construction, acquisition, or pro-
curement program (other than a construc-
tion, acquisition, or procurement program
of the Department of Defense), including
any research, development, test, and evalua-
tion related to such program;
(3) the term "Comptroller General"
means the Comptroller General of the
United States;
(4) the term "Federal funds" includes
funds provided by the Federal Government
by grant, but does not include funds allo-
cated to any State or political subdivision
thereof under chapter 67 of title 31, United
States Code, or any similar law;
(5) the term "initial cost estimate", when
used with respect to a civil acquisition pro-
gram, means the estimated total cost of
such civil acquisition program on the basis
of which the Congress enacts a law author-
izing the appropriation of funds, or, if en-
acted first, a law appropriating funds, for
the first time for such civil acquisition pro-
gram; and
(6) the term "major civil acquisition pro-
gram" means any civil acquisition program
that (A) is financed entirly with Federal
funds, and (B) is estimated to require an
eventual total expenditure (including ex-
penditures for research, development, test,
and evaluation related to such program) ex-
ceeding $50,000,000.
SEC. 2. (a) The Comptroller General shall
be responsible for ascertaining increases in
the cost of each major civil acquisition pro-
gram and compiling statistics on such in-
creases. Such statistics shall be compiled
from data submitted to the Comptroller
General under section 3 and from data col-
lected by the Comptroller General in the
process of carrying out audits and reviews
authorized by law.
SEC. 3. The head of an agency carrying out
any major civil acquisition program shall
transmit to the Comptroller General, at
such times as the Comptroller General shall
require, a report on such civil acquisition
program. Such report shall include-
(1) a description of such civil acquisition
program in terms of the mission intended to
be performed using the property acquired
under such civil acquisition program and
the expectations for the performance of
such property;
(2) the initial cost estimate for such civil
acquisition program;
(3) the estimated total cost of such civil
acquisition program as of the date on which
such report is transmitted to the Comptrol-
ler General;
(4) the total amounts of funds authorized,
funds appropriated, and funds obligated for
such civil acquisition program prior to the
date on which such report is transmitted;
(5) (A) the estimated or actual date of
completion of such civil acquisition program
as of the end of such fiscal year; and
(B) the date by which such civil acquis
when the civil acquisition program co
menced;
after the date by which such civil acquisi-
tion program was planned to be completed
when the civil acquisition program com-
menced, the reasons that such civil acquisi-
tion program will not be completed or was
not completed by the planned completion
date;
(7) all changes in the quantity or size of
the property to be acquired under such civil
acquisition program from the quantity or
size originally planned to be acquired when
the civil acquisition program commenced,
and the reasons for each such change;
(8) the reasons for any actual or projected
increase in the total cost of such civil acqui-
sition program by 25 percent or more over
the initial cost estimate for such civil acqui-
sition program; and
(9) actions taken or proposed to be taken
to control subsequent increases in the cost
of such civil acquisition program.
SEC. 4. (a) (1) Whenever the Comptroller
General determines in the case of any major
civil acquisition program that the actual or
estimated total cost of such civil acquisition
program exceeds the initial cost estimate of
such civil acquisition program by 25 percent
or more, the Comptroller General shall
transmit promptly-
(A) notice of the determination to the
head of the agency carrying out such civil
acquisition program; and
(B) a report on such determination to the
Congress.
(2) The report transmitted under para-
graph (1) shall include-
(A) a statement of the reasons for the in-
crease in the actual or estimated total cost
of such civil acquisition program;
(B) all actions taken or proposed to be
taken to control subsequent increases in the
cost of such civil acquisition program;
(C) each change made in the schedule
milestones or in any estimates of the quan-
tity of the property that the agency is ac-
quiring under such civil acquisition program
and a description of the extent to which
such changes have contributed to the in-
crease in the actual or estimated total cost
of such civil acquisition program; and
(D) an index of all testimony and docu-
ments formally provided to the Congress on
the estimated total cost of such civil acquisi-
tion program.
(b) In the case of any major civil acquisi-
tion program with respect to which the
Comptroller General transmits a notice
under subsection (a)(1)(A), no funds may be
obligated or expended on such civil acquisi-
tion program after the date on which the
head of the agency carrying out such civil
acquisition program receives such notice
unless a law described in subsection (c) is
enacted.
(c) The law referred to in subsection (b)
means a law which (1) contains only provi-
sions which provide authority to obligate
and expend funds on a major civil acquisi-
tion program to which subsection (b) ap-
plies, (2) provides such authority for a
period of not more than one year beginning
on the date of enactment of such law, and
(3) is enacted after the date on which the
head of the agency referred to in subsection
(b) receives the notice referred to in such
subsection.
SEC. 5. The Comptroller General shall de-
velop and implement policies and proce-
dures applicable to all agencies for reflect-
ing the effects of general economic inflation
on cost data reported to the Comptroller
General under section 3. -
SEC. 6. This Act shall not apply in the case
of any major civil acquisition program for
which funds have been appropriated prior
to the date of enactment of this Act.
y Mr. JEPSEN (for himself and
Mr. THuRasoID):
S. 422. A bill to amend title 18 of the
United States Code to provide a crimi-
nal penalty for robbery of a controlled
substance; to the Committee on the
Judiciary.
PHARMACY ROBBERY
? Mr. JEPSEN. Mr. President, as you
know, I have been working on legisla-
tion to make the robbery of a con-
trolled substance a Federal offense.
For the past 3 years, I have been sub-
mitting legislation to address this
problem and for the past 3 years, the
Senate has seen fit to support my ef-
forts.
Unfortunately, as many of my col-
leagues know, the House has not
always been as willing to act on this
legislation. The last days of the lame-
duck session were an example of this.
Despite overwhelming support in
both the House and the Senate, the
pharmacy robbery legislation was
never allowed to come before the
House for a vote. I think I speak for
thousands of pharmacists when I say
that this was regrettable.
Fortunately, we now have a commit-
ment from the chairman of the House
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