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The proposed guideline might suggest that little services would require to have one employee spend 3 months a year simply entering information. Keep in mind, this is information the government currently has however does not gather centrally. While I am all in favor of creating jobs, I do not believe forcing little services to employ staff members to offer data a second time is a worthwhile usage of their dollars or tax dollars, due to the fact that someone has actually got to spend for this.

Data is not complimentary. Services will decide it is better to sell independently of GSA, which will improve the government's expense to buy, or the little organizations will drop out of the federal market altogether, decreasing competitors. We have already lost over 100 little contractors in the previous 2 years.

I look forward to speaking with our witnesses today about the impacts of GSA's proposed guideline and any option they would suggest to enhance how the government buys whatever it buys. I now yield to the ranking member for his opening declaration. Mr. TAKAI. Thank you, Mr. Chairman, and excellent morning.

The GSA schedules have a number of benefits for both suppliers and buying companies. Most significantly, it creates a simpler system that allows contracting officers direct access to the items and services of various companies without the need of providing multiple solicitations for every requirement. For little companies with restricted resources, relative inexperience navigating the procurement procedure, landing on a GSA schedule can be a crucial primary step towards protecting the federal government as a consumer.

The guideline needs that firms 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 currently available to the GSA, the new rule increases the frequency of reporting and expands what details companies are needed to provide. GSA SER.

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

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What the rule requires is month-to-month reports from a variety of GSA contractors. This includes both the schedule specialists, in addition to those who hold IDIQ, indefinite shipment, indefinite amount specialists, and what we call GWACs, Government-wide Acquisition Agreements, to prepare these monthly reports of all federal sales made throughout the previous month.

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For those professionals who take part in the pilot program, they will be alleviated from a burden, what we call the rate decreases clause, which is another compliance stipulation that is in GSA contracts. In the public meeting that GSA held on April 17th, I participated in practically. My perception of that conference is that everybody in the space had issues about the guideline, including GSA's own inspector general.

The proposed rule 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 execution and compliance.

I would suggest that for some specialists, it will take six hours for them to determine which of their IT systems hold the various data aspects that GSA has required for this rule. That does not permit any time for developing a report, making sure that the report is accurate, and training its personnel on how they will send that report on a month-to-month basis.

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This could not potentially enable whenever for the professionals to actually examine the reports to ensure that the information is proper. There is nothing in the proposed rule that recommends what would occur if the contractors submit inaccurate data or if they merely eliminate information due to the fact that it is clearly incorrect.

The second bothersome area is the possible growth of what we call business sales practice requirements. GSA professionals are needed to submit industrial sales practices prior to contract award and during agreement efficiency when specific things take place, like if they go to include products to a contractor's increased costs. The proposed guideline permits GSA to request for CSPs at any time (GSA Search Engine Ranker Services).

This needs professionals to go into their data systems and take a look at real discount rates on deals. I suggest, we see press release after press release from the Department of Justice stating that contractors have actually fraudulently provided this info when in truth they just have actually not examined. So this is a huge issue.

We understand it is going to cost a lot to collect the info, however what is not clear is what benefit GSA is going to get from the information. And then finally, is the personal and proprietary nature of the info. Transactional data rates has actually constantly been secured by the courts under FOIA, and GSA does not appear to value based on remarks made at the conference that this is the case.

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As composed, small businesses would deal with increased costs under the proposed guideline. GSA recognizes the extra reporting requirement will undoubtedly have an expense for affected services. SBA's Office of Advocacy and GSA's own inspector basic noted that price quotes in the proposed rule appear drastically understated. I know others here today have finished more extensive measurements of this cost, and I will defer to them on supplying those details.

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Or as I frequently hear from service owners, am I going to require to employ somebody for this? While GSA contents its reporting option will be user- friendly, our experience is that federal government data systems are anything.

Often, however, little businesses offer tailored and innovative services that in combination with competitive rates make for finest worth in procurement instead of least expensive rate. While GSA recommends that prices will just be one consider determining finest worth, it lends significant weight. The words "rate" or "pricing" appear 165 times in the policy, while "finest worth" only appears 7.

This resembles asking sellers offering on Amazon to report to Amazon what it offered on Amazon. This seems to be an inefficient method to gather data. Lastly, and talking to the driver behind this regulation, we continue to be concerned about a vision of government procurement that seeks to classify tailored 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.