,,ii  #aacth ,,congress  #b;d ,session  
,s4 #bbhf  ,,in ,,the ,,senate ,,of     
,,the ,,united ,,states  ,may #a1 #bjad 
,mr4 ,walsh introduced the following    
bill2 which was read twice and referred 
to the ,committee on ,armed ,services   
,a ,,bill  ,to provide for greater      
oversight of ,department of ,defense    
service contracts4  #a4 ,short title    
,this ,act may be cited as the ,cutting 
,contractor ,use and ,taxpayer ,savings 
,act of #bjad4  #b4 ,findings ,congress 
makes the following findings3 7#a7      
,since #bjjb1 the ,department of        
,defense has spent more than            
#b1jjj1jjj1jjj1jjj on service           
contractors4  7#b7 ,the decade-long     
trend of outsourcing work has created a 
shadow government of service contractors
 that are largely dependent on the      
taxpayers as their sole source of       
revenue4  7#c7 ,studies show that       
service contractors can cost taxpayers  
up to twice what it costs for members of
 the ,armed ,forces to perform the work4

  7#d7 ,in #bjac1 the ,department of    
,defense spent nearly #ahj1jjj1jjj1jjj  
on service contractors1 making it the   
largest buyer of services in the        
,federal ,government4  7#e7             
,approximately #cj percent of the       
intelligence community workforce is made
 up of service contractors1 employees   
that work for companies whose primary   
goal is to make a profit and have never 
sworn an oath to defend and protect the 
,united ,states4  7#f7 ,since #bjjb1    
,congress has repeatedly enacted        
legislation to improve the ,department  
of ,defense's management of service     
contractors4 ,however1 in #bjac the     
,government ,accountability ,office     
7,,gao7 found that1 while the           
,department has taken action to address 
such legislative requirements1 there are
 no metrics in place to determine the   
effects of those actions4  #c4          
,inspector ,general analysis of service 
contractor inventory  7a7 ,in general   
,not later than #ahj days after the date

 of the enactment of this ,act1 and     
annually thereafter1 the ,inspector     
,general of the ,department of ,defense 
shall submit to the congressional       
defense committees a comprehensive      
analysis of the global inventory        
,department of ,defense service         
contractors4  7b7 ,elements ,the        
analysis required under subsection 7a7  
shall include the following elements3   
7#a7 ,a comprehensive inventory of      
,department of ,defense service         
contractors4  7#b7 ,an analysis of the  
types of service contracts that were    
significantly expanded after fiscal year
 #bjjb4  7#c7 ,identification of        
redundancies in the inventory4  7c7     
,public availability ,the analysis      
required under subsection 7a7 shall be  
made publically available4  #d4 ,defense
 ,contract ,audit ,agency reporting on  
service contracts  7a7 ,audits ,the     
,defense ,contract ,audit ,agency1 in   
conducting audits of defense contracts1 
shall distinguish service contracts in  

its analysis1 including by              
distinguishing the percentage of payment
 awarded for service elements on        
contracts containing both manufacturing 
and service elements4  7b7 ,reporting   
,not later than #ahj days after the date
 of the enactment of this ,act1 and     
annually thereafter1 the ,defense       
,contract ,audit ,agency shall submit to
 the congressional defense committees a 
report containing its findings pursuant 
to subsection 7a74 ,the report shall be 
made publically available4  #e4 ,service
 acquisition improvement plan  7a7 ,plan
 required ,not later than #ahj days     
after the date of the enactment of this 
,act1 the ,under ,secretary of ,defense 
for ,acquisition1 ,technology and       
,logistics shall1 in consultation with  
the senior services managers of the     
military departments1 submit to the     
congressional defense committees a plan 
to improve the acquisition of services  
by the ,department of ,defense4  7b7    
,elements ,the plan required under      

subsection 7a7 shall include the        
following elements3 7#a7 ,baseline data 
on the status of service acquisition1   
including budget and spending data on   
services by volume1 type1 and location4 
7#b7 ,specific goals for improving      
service acquisition4  7#c7 ,metrics to  
assess progress in meeting the goals    
outlined under paragraph 7#b74  #f4     
,reporting on use of service contracts  
by intelligence community  7a7 ,annual  
report ,not later than #ahj days after  
the date of the enactment of this ,act1 
and annually thereafter1 the ,director  
of ,national ,intelligence shall submit 
to the congressional defense committees 
and the ,select ,committee on           
,intelligence of the ,senate and the    
,permanent ,select ,committee on        
,intelligence of the ,house of          
,representatives a report with an       
inventory of service contractors used by
 each element of the intelligence       
community 7as defined in section #c of  
the ,national ,security ,act of #aidg   

7#ej ,u4,s4,c4 #cjjc774  7b7 ,form ,the 
report required under subsection 7a7 may
 be submitted in classified form1 but   
shall contain an unclassified summary   
including the total amount expended by  
each element of the intelligence        
community on service contracts4  #g4    
,limitation on allowable government     
contractor compensation costs  7a7      
,limitation  7#a7 ,civilian contracts   
,paragraph 7#af7 of section #dcjd7;a7 of
 title #da1 ,united ,states ,code1 is   
amended to read as follows3  7#af7      
,costs of compensation of contractor and
 subcontractor employees for a fiscal   
year1 regardless of the contract funding
 source1 to the extent that such        
compensation exceeds the annual salary  
of the ,president as determined under   
section #ajb of title #c1 except that   
the head of an executive agency may     
establish one or more narrowly targeted 
exceptions for scientists1 engineers1 or
 other specialists upon a determination 
that such exceptions are needed to      

ensure that the executive agency has    
continued access to needed skills and   
capabilities4  4  7#b7 ,defense         
contracts ,subparagraph 7,p7 of section 
#bcbd7;e77#a7 of title #aj1 ,united     
,states ,code1 is amended to read as    
follows3  7,p7 ,costs of compensation of
 contractor and subcontractor employees 
for a fiscal year1 regardless of the    
contract funding source1 to the extent  
that such compensation exceeds the      
annual salary of the ,president as      
determined under section #ajb of title  
#c1 except that the head of an executive
 agency may establish one or more       
narrowly targeted exceptions for        
scientists1 engineers1 or other         
specialists upon a determination that   
such exceptions are needed to ensure    
that the executive agency has continued 
access to needed skills and             
capabilities4  4  7b7 ,conforming       
amendments  7#a7 ,repeal ,section #aabg 
of title #da1 ,united ,states ,code1 is 
repealed4  7#b7 ,clerical amendment ,the

 table of sections at the beginning of  
chapter #aa of such title is amended by 
striking the item relating to section   
#aabg4  7c7 ,applicability ,this section
 and the amendments made by this section
 shall apply only with respect to costs 
of compensation incurred under contracts
 entered into on or after the date that 
is #ahj days after the date of the      
enactment of this ,act4  7d7 ,reports   
7#a7 ,in general ,not later than #fj    
days after the end of each fiscal year1 
the ,director of the ,office of         
,management and ,budget shall submit a  
report on contractor compensation to--  
7,a7 the ,committee on ,armed ,services 
of the ,senate2  7,b7 the ,committee on 
,armed ,services of the ,house of       
,representatives2  7,c7 the ,committee  
on ,homeland ,security and ,governmental
 ,affairs of the ,senate2  7,d7 the     
,committee on ,oversight and ,government
 ,reform of the ,house of               
,representatives2  7,e7 the ,committee  
on ,appropriations of the ,senate2 and  

7,f7 the ,committee on ,appropriations  
of the ,house of ,representatives4  7#b7
 ,elements ,the report required under   
paragraph 7#a7 shall include-- 7,a7 the 
total number of contractor employees1 by
 executive agency1 in the narrowly      
targeted exception positions described  
in section #dcjd7;a77#af7 of title #da1 
,united ,states ,code 7as amended by    
subsection 7a77#a771 and section        
#bcbd7;e77#a77,p7 of title #aj1 ,united 
,states ,code 7as amended by subsection 
7a77#b771 during the preceding fiscal   
year2  7,b7 the taxpayer-funded         
compensation amounts received by each   
contractor employee in a narrowly       
targeted exception position during such 
fiscal year2 and  7,c7 the duties and   
services performed by contractor        
employees in the narrowly targeted      
exception positions during such fiscal  
year4  #h4 ,reduction in service        
contract spending  7a7 ,three-,year     
requirement  7#a7 ,limitation ,the      
aggregate amount obligated and expended 

by the ,department of ,defense for      
service contracts in fiscal years       
beginning after ,september #cj1 #bjag1  
may not exceed the lesser of-- 7,a7 the 
amount equal to #fg percent of the      
aggregate amount expended for service   
contracts in fiscal year #bjad2 or  7,b7
 the amount equal to #fg percent of the 
amount appropriated for the ,department 
of ,defense for the current fiscal year 
and available for service contracts4    
7#b7 ,inapplicability of limitation ,the
 limitation in paragraph 7#a77;,b7 shall
 not apply if the ,secretary of ,defense
 certifies to ,congress in writing that 
the aggregate amount to be obligated and
 expended by the ,department of ,defense
 in such fiscal year for service        
contracts will not exceed the amount    
specified in paragraph 7#a77;,a74  7b7  
,ten-,year requirement ,the amount      
obligated and expended by the           
,department of ,defense on service      
contracts in fiscal years beginning     
after ,september #cj1 #bjbd1 may not    

exceed the amount obligated or expended 
by the ,department of ,defense on       
service contracts in fiscal year #bjjb  
7adjusted for inflation74  #i4          
,congressional defense committees       
defined ,in this ,act1 the term         
congressional defense committees has the
 meaning given the term in section      
#aja7;a77#af7 of title #aj1 ,united     
,states ,code4