House Dems propose rules to save billions in improper contractor payments

Rep. Edolphus Towns (D-N.Y.) and 19 other House Democrats this week proposed legislation that they say could help save the government $125 billion per year, by stopping improper payments to contractors.

“As stewards of taxpayer dollars, we must be certain that we maintain the integrity of the programs established to help those in need,” said Towns, ranking member of the House Oversight and Government Reform subcommittee on Government Organization, Efficiency and Financial Management. “This bill takes important steps towards ensuring programs are only benefiting those who are eligible.”

Rep. Kurt Schrader (D-Ore.), chairman of the Blue Dog Task Force on Fiscal Responsibility and a co-sponsor of the bill, said it is “irresponsible” not to explore ways to prevent improper federal payments, and said the current system, which focuses on recovering payments after the fact, is not enough.

“In an era of trillion-dollar deficits, it is inefficient and irresponsible for the government to only be recovering improper federal payments after the fact,” Schrader said. “This legislation takes a proactive approach in saving taxpayer dollars by giving federal agencies the tools they need to prevent improper payments.”

Under current law, federal agencies are already required to estimate the amount of improper payments they make and submit those estimates to Congress.

The Improper Payments Elimination and Recovery Improvement Act, H.R. 4053, would strengthen current law, in part by establishing a Do Not Pay initiative. Under that plan, federal agencies would have to screen payees against databases that help verify their eligibility. The bill would also require agencies to submit their reports on improper payments to their respective inspectors general, and make public any reports on large improper payments.

Politically, the bill lets Democrats stake a claim to deficit reduction, an issue Republicans have pressed since taking control of the House. While Republicans have pushed for spending cuts, Democrats have generally argued for tax increases to trim the budget deficit, but the Towns bill finds a middle ground by trying to ensure federal money that is spent is spent more efficiently.

“This bipartisan legislation to reduce improper payments will save taxpayer money and strengthen Medicare and will help us save up to $125 billion annually,” said Rep. Gerry Connolly (D-Va.). One Republican, Rep. Todd Platts (Pa.), joined Democrats on the bill.

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