Senate Approves Collins’ Amendment Limiting Defense Contract Bundling

WASHINGTON—Today, the Senate approved an amendment to the 2004 Defense Authorization bill offered by Senator Susan Collins (R-ME), chairman of the Governmental Affairs Committee, that will help give small businesses greater access to defense contracts.

The Governmental Affairs Committee has governmentwide jurisdiction over federal contracts for goods and services. The amendment, co-sponsored by Senators James Talent (R-MO), Kay Bailey Hutchison (R-TX) and Olympia Snowe (R-ME) would limit the Department of Defense’s prolific use of bundled contracts, which disadvantage small businesses.

Unlike contracts for major construction projects such as aircraft, ships or tanks, contract bundling combines requirements for goods and services that are not necessarily related. For example, an agency may bundle individual contracts for grounds maintenance, facilities cleaning and roof repair into one larger contract. This practice simplifies the workload of the contracting officer but often precludes small businesses from bidding on the larger, bundled contracts. Throughout the government, the number and value of contracts that have been bundled has dramatically increased over the last decade. Although the rate of bundled contracts is high at agencies such as the General Services Administration, the Department of Health and Human Services, and the Department of the Treasury, the Defense Department is considered the government’s primary source of bundling because of its significantly higher level of spending.

“The proliferation of contract bundling, especially at the Department of Defense, has dramatically reduced the government’s contractor base,” Collins said. “It’s a losing situation for everyone – for small businesses, for the government and, ultimately, for the taxpayers.”

The Collins-Talent amendment, which passed the Senate by unanimous consent, is supported by the National Federation of Independent Business and the National Black Chamber of Commerce. The amendment is posted on the committee’s website at