Reporting Requirement for Political Contributions and Correspondence Proposed

Most Government contractors, perhaps all of them, know and understand that contributions and donations, including cash, property and services, regardless of recipient, are unallowable (see FAR 31.205-8). The cost principle is simple, straight-forward, and contains none of the nuances found in many other cost principles.

As long as contributions are excluded from forward pricing estimates and incurred costs, the Government is satisfied, right? Not if Rep. Ellison gets his way. Rep Ellison has introduced an amendment to the 2018 NDAA (National Defense Authorization Act) that establishes a new reporting requirement for Defense contractors.

The amendment reads:

Not later than 30 days after a contract is awarded using funds authorized under this Act (i.e. the Fiscal Year 2018 NDAA), the relevant contractor and subcontract at any tier (and any principal with at least 10 percent ownership interest, officer, or director of the contractor or subcontractor or any affiliate or subsidiary with the control of the contractor or subcontractor) shall disclose to the Administrator of General Services all electioneering communications, independent expenditures, or contributions made in the most recent election cycle supporting or opposing a Federal political candidate, political party, or political committee, and contributions made to a third-party entity with the intention or reasonable expectation that such entity would use the contribution to make independent expenditures or electioneering communications in Federal elections.

We have no idea whether this amendment will be adopted into the NDAA. A requirement to send all electioneering communications to the GSA (General Services Administration) seems draconian. Then there is the question of what the GSA will do with the information. Who will have access to it? What will they do with it? How will it be cataloged and referenced? We hope this amendment dies.