Bill could turn contractors into lobbyists

As federal contracting officials begin to warm up to more interaction with industry, many government contractor employees could be redefined as lobbyists under a new bill, possibly chilling discussions on upcoming business opportunities.

Congress is now working out the final details of a bill aiming to stop insider trading by senior government officials. However, industry groups fear the bill could turn business analysts into lobbyists. The groups say it would wreak havoc on industry and government relationships.

The Acquisition Reform Working Group, a conglomeration of eight industry groups, sent letters Feb. 16 to members of Congress, urging them to rework a broad definition of “political intelligence consultants” in the Stop Trading on Congressional Knowledge (STOCK) Act (S. 2038). Under the Senate’s version, the language would require even government contractors who talk to their customer agencies to register as lobbyists under the Lobbying Disclosure Act.

“Political intelligence contact” would be any communication to or from certain officials that is intended for use “in informing investment decisions.”

Trey Hodgkins, senior vice president for national security and procurement policy at TechAmerica, a member of the working group, said a company’s employees, who talk with officials to learn about upcoming contracts that an agency may be considering, could be gathering intelligence on where it will invest its resources and time in preparing a bid on a contract.

“Applying this nebulous term could result in broad reporting requirements for federal government contractors and others simply for engaging in the regular and necessary day-to-day communications with their federal customers,” the group wrote in its letter.

To further impact the situation, a proposed rule by the Office of Government Ethics would block many industry experts from interacting with government employees, not just political appointees, Hodgkins said.

“It’s a Catch 22 for companies,” he said.

The intent of the original STOCK Act was to eliminate insider trading by legislative and executive branch officials is an understandable concern, Hodgkins said. But the definition could go beyond the intent.

“At a time when senior leaders in the Executive Branch are encouraging improved communication between industry and government, it strikes our associations as counterproductive to adopt language that discourages such communication between federal and private sector partners,” according to the letter.

In talking with congressional staff members, Hodgkins said this wasn’t the intent of the definition. They had analysts at hedge funds in mind.

Hodgkins also said the staff members would consider clarifying the definition in the Senate’s bill.

The working group urged lawmakers to let the Government Accountability Office and the Congressional Research Service report on the role of political intelligence in the financial markets before putting a definition in statute. Both the House and Senate bills would require an investigation by both GAO and CRS.

The STOCK Act passed the Senate 96 to 3 on Feb. 2. The House passed its similar version 417 to 2 Feb. 9. The two chambers are working out the differences in the bills before sending it to the White House for President Barack Obama’s signature. The administration has said it strong supports the Senate’s bill.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

Featured

  • Contracting
    8 prototypes of the border walls as tweeted by CBP San Diego

    DHS contractors face protests – on the streets

    Tech companies are facing protests internally from workers and externally from activists about doing for government amid controversial policies like "zero tolerance" for illegal immigration.

  • Workforce
    By Mark Van Scyoc Royalty-free stock photo ID: 285175268

    At OPM, Weichert pushes direct hire, pay agent changes

    Margaret Weichert, now acting director of the Office of Personnel Management, is clearing agencies to make direct hires in IT, cyber and other tech fields and is changing pay for specialized occupations.

  • Cloud
    Shutterstock ID ID: 222190471 By wk1003mike

    IBM protests JEDI cloud deal

    As the deadline to submit bids on the Pentagon's $10 billion, 10-year warfighter cloud deal draws near, IBM announced a legal protest.

Stay Connected

FCW Update

Sign up for our newsletter.

I agree to this site's Privacy Policy.