Agencies' Use of Procurement Flexibilities Provided in the Homeland Security Act of 2002 (P.L. 107-296)

In the wake of September 11, 2001, Congress enacted the Homeland Security Act of 2002. Title VIII, subtitle F, section 852 of the act provided for a temporary set of emergency procurement flexibilities intended to address the immediate needs for procurement of property (other than real property) or services to be used to defend against or recover from terrorist threats, including nuclear, biological, chemical, or radiological attacks. These flexibilities, which expired on November 24, 2003, included (1) increasing the threshold for simplified acquisition procedures in support of humanitarian, peacekeeping, or contingency operations from $100,000 to $200,000 for contracts awarded and performed within the United States and, for contracts awarded and performed, or purchases to be made outside the United States, to $300,000; (2) increasing the micro-purchase threshold from $2,500 to $7,500 to allow agencies the use of purchase cards above the current limit; (3) waiving certain provisions of law and the dollar threshold related to commercial item procurements; and (4) requiring the head of an agency, when appropriate, to use streamlined acquisition authorities and procedures authorized by law for a procurement referred to in section 852. Section 852 of the Homeland Security Act directed us to report no later than March 31, 2004, on the extent to which federal agencies have used the flexibilities.

Of the six agencies GAO contacted, four (the Departments of Energy, Homeland Security, Justice, and Transportation) reported no use of the procurement flexibilities. NASA conducted an informal survey of the three procurement activities that would be most likely to use the flexibilities afforded under the act (Johnson Space Center, Kennedy Space Center, and Goddard Space Flight Center), and, according to NASA, these activities responded that they had not used the flexibilities. NASA also indicated a willingness to conduct a more thorough review but warned that such a review would take considerable time to complete. In April 2003, DOD's Director of Defense Procurement and Acquisition Policy encouraged the military services and defense agencies to take advantage of the flexibilities. However, DOD indicated that, because the law did not levy a formal reporting requirement, it did not implement a tracking system and, therefore, could not quantify use of these flexibilities. Considering that the authority for these flexibilities had expired, DOD did not believe it was a wise expenditure of public funds to conduct a manual data call to obtain the information we requested.