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DOCUMENT RESUME
02631 - [A1752771]
S. 1594 to Revise and Extend the Renegotiation Act of 1951. June
13, 1977. 12 pp.
Testimony before the Senate Committee on Banking, Housing and
Urban Affairs; by Robert F. Keller, Deputy Comptroller General.
Issue Area: Federal Procurement of Goods and Services (19001.
Contact: Office of the Comptroller General.
Budget Function: General Government: General Property and
Records Management (804).
Organization Concerned: Renegotiation Boarl.
Congressional Relevance: Senate Committee on Banking, Housing
and Urbin Affairs.
Authority: Renegotiation Act of 1951. S. 1594 (95th Cong.).
The proposed Senate bill to revise and extend the
Renegotiation Act of 1951 (S. 1594) should lead to major
improvements in the renegotiation process. The Renegotiation Act
is essential to provide one last opportunity for the Government
to assure that contractors are making no more than a reasonable
profit. An extension of the act for a 5-year period could
enhance the Renegotiation Board's ability to recruit qualified
personnel and provide an incentive for long-range planning. The
elimination of the use of the percen ;e-of-completion method of
accounting and the required us, of a units delivered or
completed contract method of iccounting fu.r renegotiation
purposes, as proposed in the biLl, would add necessary
objectivity to the renegotiatic.n process. The provision in the
bill that would require contractors to report renegotiation
business on the basis of division and product line is a much
needed reform in the act. The elimination of the oil- and
gas-well exemption from renegotiation also provides needed
reform. The penalties included in the proposed legislation for
knowingly failing to lile or submittimg false information should
increase compliance with the act's filing requirements. Congress
should eliminate the partial exemption of sales of new, durable,
productive equipment from renegotiation. It should consider
including a provision requiring the Board to establish
guidelines for apply.'ng statutory factors for determining
excessive profits in the le9islation. (SC)](ViewImageLocal?handle=hein.gao/gaobadxuq0001&div=1&collection=&method=preview&ext=.png&size=3)