Policy Issues That Matter to Industry

By Lawrence P. Farrell

As a non-profit, non-partisan organization, NDIA advocates legislation, regulations and policies that are essential to a strong and ready defense industrial base. We work closely with Congress and the Executive Branch as an industry voice to ensure our government policymakers and lawmakers know where we stand on specific issues.

In this President’s Perspective, I would like to highlight some of the key policy issues that we—together with other partner associations—have been working on this past year. These issues all have significant impact on the defense industrial base, and, hopefully, you will be pleased with the results to date.

NDIA always has opposed legislation that was designed to limit the federal government’s flexibility in outsourcing work to the private sector. One such piece of legislation offered last year was the Truthfulness, Responsibility and Accountability in Contracting Act, which would impose a moratorium on future outsourcing, as well as mandate the use of the Office of Management and Budget A-76 Circular as the basis for all future outsourcing determinations.

When the bill was introduced, we provided our corporate members with background information and sample letters for use in contacting members of Congress. In addition, NDIA coordinated our work with other associations through our affiliation with the Coalition for Outsourcing and Privatization (COP). So far, we have been successful in keeping the proposed legislation from moving forward. However, it is still an active bill, which could be brought up again this year. Consequently, we intend to play offense instead of defense in the months to come.

Along the same lines, we successfully opposed a provision in the House version of the fiscal year 2002 National Defense Authorization Act (NDAA). The provision, as reported by the House Armed Services Committee, would have greatly expanded the government functions required to undergo the lengthy A-76 process in order to be outsourced, and would have forced the Pentagon to open up contractor jobs to competition from public-sector workers. Fortunately, it was deleted in the House-Senate conference that preceded final passage of the Act. Again, NDIA activities on this issue were coordinated with other associations through COP.

Another issue that has generated controversy over the years is the mandate requiring the use of the Federal Prison Industries (FPI) as a preferred Defense contractor. Several federal agencies have been required by law to procure certain products directly from FPI with no competition. This situation represents a significant loss of business opportunities to small, medium, and large contractors alike. NDIA independently, and as a member of the Coalition for Competition in Contracting, supported a provision in the Senate version of the fiscal year 2002 NDAA that allows Defense contracting officers to compete contracts for products that they formerly had to assign to FPI. The provision prevailed in the House-Senate conference and is now public law.

As we have done in years past, NDIA continues to support the Defense Department’s efforts to conduct additional Base Realignment and Closure (BRAC) rounds. Last year, NDIA sent multiple letters to the House and Senate backing Secretary of Defense Donald Rumsfeld’s proposal for an additional BRAC round in 2003. Congress opted to delay another round until 2005.

On the regulatory front, NDIA vigorously opposed a proposed rule that would have required contractors to certify, under penalty of criminal liability for false swearing, that they have complied with all federal and state labor, employment, tax, environmental, anti-trust, and consumer protection laws for a period of three years prior to being awarded any contract. Under this so-called “blacklisting” rule, federal contracting officers, with no special training in any of these laws, would have had to determine a contractor’s satisfactory compliance with them before they could proceed to make an award. Not only did NDIA express opposition to this rule on its own but added our voice as a member of the multi-association National Alliance Against Blacklisting. As a result, the rule was revoked.

We also were successful on two other issues—both related to depot-level maintenance. On one issue (referred to as “hold harmless”), private-sector partners can now file legal claims against their public-sector partners when the latter fail to comply with cost, schedule, and performance requirements. On the other issue, we were successful in getting relief from the 50-50 limitation on public-private work share. Work performed by contractors as part of a public-private partnership is now excluded from this limitation when the work is performed at a depot.

We also took steps to highlight industry’s human capital problems. One of our committee chairmen provided testimony to the House Science Committee on the loss of valuable skills in the industry and the difficulty of hiring top managerial and technical talent to replace these lost skills. As a follow-up to the testimony, NDIA submitted a list of proposed legislative initiatives dealing with the human capital crisis, specifically directing attention to fields requiring degrees in math, science and engineering. Recognizing that this is a problem that won’t get solved overnight, we have included it in our “Top Issues for 2002.”

In summary, I am pleased to report that our efforts have been successful and worthwhile. I believe that NDIA is devoting appropriate resources to issues that matter not just to our members, but to the nation’s industrial and technology base as well. Our Government Policy department has been hard at work this past year and will continue to push full speed ahead in 2003. It is an important arm of the Association. You can learn more about NDIA’s government policy efforts by visiting our Web site,

Topics: Industrial Base, Government Policy, Presidents Perspective

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