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Tuesday, June 29, 2010

Environmental Considerations in Federal Procurement: An Overview of the Legal Authorities and Their Implementation

Kate M. Manuel
Legislative Attorney

L. Elaine Halchin
Specialist in American National Government

Coupled with increasing concerns about the environment, the magnitude of federal spending on contracts has prompted numerous questions from Members of Congress and the public about the role of environmental considerations in federal procurement. These include to what extent do agencies consider environmental factors when procuring goods or services? What legal authorities presently require or allow agencies to take environmental factors into account when acquiring goods or services? How are existing provisions authorizing agencies to consider environmental factors implemented? This report provides an overview, answering these and related questions.

The federal procurement system is designed "to deliver on a timely basis the best value product or service to the customer, while maintaining the public's trust and fulfilling public policy objectives." Environmental objectives can generally be among the public policy objectives that factor into federal procurement. However, they are not necessarily the most significant objectives overall or in any specific procurement. There are numerous other objectives (e.g., obtaining high quality goods and services at low prices, promoting American manufacturing, protecting small businesses, fostering affirmative action) that can also factor into procurement decisions. The relationship and prioritization among these different objectives is presently unclear.

Various legal authorities currently require or allow contracting officers to take environmental considerations into account when procuring goods or, less commonly, services. These authorities can be broadly divided into three categories: (1) "attribute-focused" authorities, generally requiring agencies to avoid or acquire products based on their environmental attributes (e.g., ozone-depleting substances, recovered content); (2) general contracting authorities, allowing agencies to purchase goods with certain environmental attributes when they have bona fide requirements for such goods; and (3) responsibility-related authorities, which require agencies to avoid certain dealings with contractors that have been debarred for violations of the Clean Air or Clean Water Acts. "Attribute-focused" authorities arguably do not deprive vendors of ineligible products of due process or equal protection in violation of the U.S. Constitution. However, certain preferences for products with desired environmental attributes, or vendors of such products, could violate procurement integrity regulations and the Competition in Contracting Act if not based in statute. Use of evaluation factors based on environmental considerations is possible in negotiated procurements, but subject to certain conditions, and the reportedly lower lifecycle costs of "green" products do not, per se, mean their acquisition is justified on a "best value" basis.

Agencies generally implement existing authorities by relying on third-party designations of products with specific environmental attributes and by using standard purchasing methods, including bilateral contracts, the Federal Supply Schedules, and government-wide commercial purchase cards.

The 111th Congress has held hearings on the environmental and related effects of federal procurement practices, and Members have introduced legislation that could expand the preferences given to "sustainable" products in certain federal procurements (H.R. 5136, § 833; H.R. 5280) and assist the "green" procurement efforts of state and local governments (H.R. 1766, S. 1830). President Obama has also issued an executive order (E.O. 13514) calling for the federal government to "leverage agency acquisitions to foster markets for sustainable technologies and environmentally preferable materials," among other things.

Date of Report: June 21, 2010
Number of Pages: 27
Order Number: R41297
Price: $29.95

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