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The proposed rule could imply that little organizations would require to have one employee invest three months a year simply getting in data. Bear in mind, this is information the federal government currently has however does not gather centrally. While I am all in favor of producing tasks, I do not think requiring small companies to work with staff members to provide information a second time is a beneficial use of their dollars or tax dollars, due to the fact that someone has got to pay for this.

Information is not totally free. Services will decide it is better to sell independently of GSA, which will improve the federal government's expense to buy, or the small companies will drop out of the federal market altogether, decreasing competition. In fact, we have actually already lost over 100 little specialists in the previous two years.

I look forward to hearing from our witnesses today about the impacts of GSA's proposed rule and any alternative they would recommend to enhance how the government purchases whatever it purchases. I now yield to the ranking member for his opening declaration. Mr. TAKAI. Thank you, Mr. Chairman, and excellent early morning.

The GSA schedules have a number of benefits for both suppliers and acquiring agencies. Most especially, it produces an easier system that permits contracting officers direct access to the product or services of numerous firms without the need of issuing multiple solicitations for every requirement. For small companies with minimal resources, relative lack of experience navigating the procurement process, landing on a GSA schedule can be a crucial initial step towards protecting the federal government as a customer.

The rule needs that companies that hold schedule agreements while other government-wide acquisition agreements report transactional information through an electronic system. While it appears that much of this data is already available to the GSA, the brand-new rule increases the frequency of reporting and expands what details firms are needed to offer. GSA SER Services.

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With that, I thank the witnesses for affirming today, and I yield back. Chairman HANNA. Thank you.

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What the rule requires is regular monthly reports from a range of GSA professionals. This consists of both the schedule specialists, as well as those who hold IDIQ, indefinite shipment, indefinite quantity specialists, and what we call GWACs, Government-wide Acquisition Agreements, to prepare these monthly reports of all federal sales made throughout the prior month.

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For those specialists who take part in the pilot program, they will be alleviated from a burden, what we call the price reductions stipulation, which is another compliance provision that remains in GSA agreements. In the general public conference that GSA hung on April 17th, I participated in practically. My understanding of that meeting is that everybody in the room had issues about the guideline, consisting of GSA's own inspector general.

The proposed guideline raises a variety of issues (GSA SER Software). The first, which I am sure you will hear from all our panel members about, is the expense of implementation and compliance.



I would suggest that for some professionals, it will take six hours for them to determine which of their IT systems hold the various data aspects that GSA has needed for this rule. That does not allow whenever for developing a report, making sure that the report is accurate, and training its workers on how they will submit that report on a month-to-month basis.

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This could not perhaps enable at any time for the specialists to really review the reports to ensure that the data is proper. There is nothing in the proposed guideline that recommends what would happen if the specialists submit incorrect information or if they simply remove information since it is undoubtedly inaccurate.

The second bothersome area is the prospective growth of what we call industrial sales practice requirements. GSA professionals are needed to submit business sales practices prior to agreement award and throughout contract efficiency when particular things happen, like if they go to include items to a professional's increased prices. The proposed guideline permits GSA to request for CSPs at any time (GSA SER Software).

This requires contractors to go into their data systems and take a look at real discount rates on deals. I suggest, we see press release after news release from the Department of Justice mentioning that contractors have actually fraudulently offered this details when in reality they just have not checked. This is a big concern.

We understand it is going to cost a lot to gather the information, but what is not clear is what advantage GSA is going to get from the info. And then lastly, is the personal and exclusive nature of the information. Transactional data rates has actually always been safeguarded by the courts under FOIA, and GSA does not appear to value based on remarks made at the conference that this holds true.

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GSA recognizes the extra reporting requirement will undoubtedly have a cost for affected services. SBA's Workplace of Advocacy and GSA's own inspector general kept in mind that estimates in the proposed guideline appear considerably downplayed.

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Intricacy, on the other hand, measures if a policy change will make selling to the government harder or easier. Essentially, will the federal market be basically tough to understand? Or as I often speak with business owners, am I going to require to hire someone for this? While GSA contents its reporting solution will be user- friendly, our experience is that government data systems are anything.

Often, nevertheless, small companies offer tailored and ingenious options that in conjunction with competitive pricing produce finest value in procurement instead of most affordable cost. While GSA suggests that prices will just be one consider determining finest value, it provides significant weight. The words "cost" or "pricing" appear 165 times in the policy, while "best worth" only appears seven.

This is like asking retailers offering on Amazon to report to Amazon what it sold on Amazon. This appears to be an ineffective way to gather data. Finally, and speaking to the motorist behind this regulation, we continue to be concerned about a vision of government procurement that seeks to classify customized services into narrow classifications.

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Thank you, Mr. Stanford. Next, we have Mr. Roger Waldron, who is president of the Coalition of Government Procurement. We can break now however I believe we do have time to get through.

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