Letter undated, to Senator Bob Packwood, Senate Small Business Commit- Letter dated August 16, 1977, to Senator Bob Packwood, Senate Small Letter dated August 30, 1977, to Senator Bob Packwood, Senate Small Page 286 287 288 302 303 Letter dated August 19, 1977, to Senator Bob Packwood, Senate Small Business Committee, from R. K. Girardelli, assistant treasurer, Diamond Fruit Growers, Inc., Hood River, Oreg---. Letter undated, to Senator Bob Packwood, Senate Small Business Com- 304 305 306 Letter dated August 23, 1977, to Senator Bob Packwood, Senate Small 307 Letter dated August 22, 1977, to Senator Bob Packwood, Senate Small Letter undated, to Senator Bob Packwood, Senate Small Business Commit- Letter dated August 5, 1977, to Senator Bob Packwood, Senate Small Letter dated August 24, 1977, to Senator Bob Packwood, Senate Small 308 309 312 313 315 Letter dated August 15, 1977, to Senator Bob Packwood, Senate Small Letter undated, to Senator Bob Packwood, Senate Small Business Committee, from James Green, Salem, Oreg-- 316 317 Letter dated August 18, 1977, to Senator Bob Packwood, Senate Small 318 Letter undated, to Senator Bob Packwood, Senate Small Business Commit- 319 320 Letter dated August 18, 1977, to Senator Bob Packwood, Senate Small 322 Letter dated August 15, 1977, to Senator Bob Packwood, Senate Small 323 Letter dated August 18, 1977, to Senator Bob Packwood, Senate Small Letter dated August 18, 1977, to Senator Bob Packwood, Senate Small 324 325 Letter dated August 15, 1977, to Senator Bob Packwood, Senate Small 326 Letter dated August 15, 1977, to Senator Bob Packwood, Senate Small Business Committee, from Clem Lesueur, Midland Empire Insurance Page Agency, Klamath Falls, Oreg--- 327 Letter dated August 25, 1977, to Senator Bob Packwood, Senate Small Business Committee, from Mrs. Joanne Miller, director, Executive Services, Pasadena, Calif Letter dated August 16, 1977, to Senator Bob Packwood, Senate Small 328 Letter dated August 22, 1977, to Senator Bob Packwood, Senate Small Letter dated August 17, 1977, to Senator Bob Packwood, Senate Small 333 334 335 Letter dated August 8, 1977, to Senator Bob Packwood, Senate Small Business Committee, from Bernie Nelson, vice president, controller/ treasurer, Jayveebrand, Inc., Lake Oswego, Oreg Letter dated August 19, 1977, to Senator Bob Packwood, Senate Small 336 337 Letter dated August 23, 1977, to Senator Bob Packwood, Senate Small Letter dated August 19, 1977, to Senator Bob Packwood, Senate Small Letter dated August 15, 1977, to Senator Bob Packwood, Senate Small Letter dated August 23, 1977, to Senator Bob Packwood, Senate Small Letter dated August 16, 1977, to Senator Bob Packwood, Senate Small Letter dated August 16, 1977, to Senator Bob Packwood, Senate Small Letter dated August 25, 1977, to Senator Bob Packwood, Senate Small 339 340 341 342 343 344 345 346 Letter dated August 8, 1977, to Senator Bob Packwood, Senate Small Letter dated August 19, 1977, to Senator Bob Packwood, Senate Small Letter dated August 9, 1977, to Senator Bob Packwood, Senate Small 347 348 Letter dated August 15, 1977, to Senator Bob Packwood, Senate Small Letter dated August 16, 1977, to Senator Bob Packwood, Senate Small 350 351 352 353 354 Letter dated August 17, 1977, to Senator Bob Packwood, Senate Small 355 356 Letter undated, to Senator Bob Packwood, Senate Small Business Com- Page Letter dated August 24, 1977, to Senator Bob Packwood, Senate Small 358 359 360 Letter dated August 22, 1977, to Senator Bob Packwood, Senate Small Letter undated, to Senator Bob Packwood, Senate Small Business Committee, from H. W. Stevenson, Eugene, Oreg‒‒‒ Letter dated August 30, 1977, to Senator Bob Packwood, Senate Small 361 362 363 364 Letter undated, to Senator Bob Packwood, Senate Small Business Committee, from George H. Swartsley, RPh., pharmaceutical consultant, Salem, Oreg‒‒‒ 365 Letter dated August 15, 1977, to Senator Bob Packwood, Senate Small 366 369 Letter undated, to Senator Bob Packwood, Senate Small Business Committee, from A. B. Winkle, Cornell Manufacturing Co., Portland, Oreg__ Letter dated August 5, 1977, to Senator Bob Packwood, Senate Small Business Committee, from Durward E. Wright, owner, Oblique Northwest, Portland, Oreg__. Letter dated August 16, 1977, to Senator Bob Packwood, Senate Small Business Committee, from Dale L. Woodruff, American Guaranty Insurance Co., Portland, Oreg__ 370 371 372 Letter dated September 7, 1977, to Senator Bob Packwood, Senate Small Letter dated September 20, 1977, to Senator Bob Packwood, Senate Small Letter dated September 19, 1977, to Senator Bob Packwood, Senate Small Letter dated September 22, 1977, to Senator Bob Packwood, Senate Small 373 381 384 387 Letter dated September 8, 1977, to Senator Bob Packwood, Senate Small 388 Letter dated June 29, 1977, to Senator Bob Packwood, Senate Small Busi- 394 397 399 Letter dated August 28, 1977, to Senator Bob Packwood, Senate Small 401 HEARING DATE August 26, 1977: Morning session__. 1 LATE PAYMENTS TO CONTRACTORS BY FEDERAL AGENCIES FRIDAY, AUGUST 26, 1977 U.S. SENATE, SELECT COMMITTEE ON SMALL BUSINESS, The committee met, pursuant to notice, at 9 a.m., in the Lloyd Center Auditorium, Portland, Oreg., Hon. Bob Packwood, acting chairman, presiding. Present: Senator Packwood. Also present: John M. Cross, professional staff member, Senate Small Business Committee; and Gregory C. Dow, legislative assistant, office of Senator Packwood. Senator PACKWOOD. The hearing will please come to order. This hearing of the Senate Committee on Small Business is intended to determine the weaknesses Oregon businessmen have found in the Federal procurement process. It is appropriate that we hold this hearing in Portland. In November of 1976, I held a conference here to disseminate to Oregon businessmen information on contracting opportunities with the Federal Government. I asked for opinions of the businessmen at that conference and found there were two primary complaints regarding the methods Federal agencies use to procure goods and services. First, some agencies do not pay their bills on time. Also, individual agencies have methods of procurement which result in excessive paperwork for the contractor. În a recent questionnaire I sent to Oregon businessmen, 32 percent of the respondents said they refused to contract with the Government because of the excessive paperwork and regulation. Confusing regulations, which appear to have no logic or consistency, preclude the smaller businessman from entering into or continuing in the field of Federal contracting. Some relief is in sight. Legislation which I have cosponsored this Congress, the Federal Acquisition Act of 1977, would consolidate the regulations of the armed services and the civilian agencies. It would provide a mechanism to foster competition and open up the procurement process to small- and medium-sized firms. Hearings have been held in the Senate Committee on Governmental Affairs, and I am confident the full Senate will consider the proposal early next year. Aside from its current merit, this legislation can act as a vehicle for moving the proposals we agree on today. We will probably never completely solve the Federal paperwork and excessive regulation problems we have, but we can at least make a start in that direction. (1) Second, I feel we can have a more significant and immediate impact on the timeliness of payment by Federal agencies to the contractors. Fifty-six percent of the respondents to my questionnaire said they had been paid late by Federal agencies at least once. I felt this situation deserved greater attention, so I held a hearing on June 21 in Washington, D.C., to hear from Federal agencies. The General Accounting Office reported that six major agencies pay over one-half of their invoices late. The General Services Administration paid 73.8 percent of its invoices late, Civil Service, 69.2 percent, Health, Education, and Welfare, 68.2 percent, and the Department of Transportation, 64.3 percent. The evidence presented at that hearing was enough to enable to persuade the White House Office of Federal Procurement Policy to begin an investigation into possible solutions. I proposed that agencies be required to pay within 30 days of invoice or interest would begin to accrue. I asked the Office of Federal Procurement Policy to implement this requirement by including such language in each Federal contract. Whether this contract clause is implemented or not, I intend to press for legislation which will clear up the late payment problem. The contractors here today can illustrate the seriousness of the late payment problem. I will then take the evidence provided me today back to Washington in order to persuade my colleagues in the Senate and House of Representatives of the importance of immediately correcting the late payment problem. First we'll take Don Gundersen, who's the president of the Portland Chamber of Commerce, then Jack Kalinoski, Holly Cornell, Orrin Agrimson, Bob Jack of OECO, Art Brown, Bob Westerman, Ed McKenney, Lois Renwick, Dave Retzlaff, Chuck Wilson, Floyd Chapman, Bob Heestand, Bill Harvey, A. F. Gwinner, Lewis Hallmark, and then additional statements from some witnesses who may come but have not signed up. I told those who got here and had not signed up they could testify at the end of the hearing. If a witness is not here when we get to his place on the program, we will simply put him at the end and take him when we begin the others. So I will start with Don Gundersen. Is he here? There he is. Don Gundersen for an opening statement from the Portland Chamber of Commerce. STATEMENT OF DONALD L. GUNDERSEN, PRESIDENT, PORTLAND CHAMBER OF COMMERCE, PORTLAND, OREG. Mr. GUNDERSEN. Senator Packwood, I would like to express the thanks of the Portland Chamber of Commerce for the Senate Select Committee on Small Business to take time to express the interest and attention on many of the problems associated with doing business with the Federal Government, as well as the compounding problems of increased paperwork and Government regulations. We will continue, as in the past, to communicate these problems representing the increased concerns of our 4,000 members in the Greater Portland area, but we appreciate particularly the opportunity today, Senator, to allow many of the people from our community to |