II
119THCONGRESS
1
STSESSION S. 80
To amend title 31, United States Code, to improve the prevention of improper
payments, and for other purposes.
IN THE SENATE OF THE UNITED STATES
JANUARY13, 2025
Mr. L
ANKFORDintroduced the following bill; which was read twice and
referred to the Committee on Homeland Security and Governmental Affairs
A BILL
To amend title 31, United States Code, to improve the
prevention of improper payments, and for other purposes.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘Safeguarding the 4
Transparency and Efficiency of Payments Act’’ or the 5
‘‘STEP Act’’. 6
SEC. 2. IMPROPER PAYMENTS. 7
(a) D
EFINITIONS.— 8
(1) I
N GENERAL.—Section 3351 of title 31, 9
United States Code, is amended— 10
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(A) by redesignating paragraphs (2) 1
through (8) as paragraphs (3) through (9), re-2
spectively; and 3
(B) by inserting after paragraph (1) the 4
following: 5
‘‘(2) C
HIEF FINANCIAL OFFICER .—The term 6
‘chief financial officer’ means— 7
‘‘(A) with respect to an executive agency 8
described in section 901(b), the Chief Financial 9
Officer of the executive agency appointed under 10
such section; and 11
‘‘(B) with respect to an executive agency 12
that is not described in section 901(b), the offi-13
cial serving as the senior executive responsible 14
for managing the financial activities of the exec-15
utive agency.’’. 16
(2) C
ONFORMING AMENDMENTS .—Section 17
3353(a)(4)(B) of title 31, United States Code, is 18
amended— 19
(A) in clause (i), by striking ‘‘section 20
3351(2)(B)’’ and inserting ‘‘section 21
3351(3)(B)’’; 22
(B) in clause (ii), by striking ‘‘section 23
3351(2)(C)’’ and inserting ‘‘section 24
3351(3)(C)’’; 25
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(C) in clause (iii), by striking ‘‘section 1
3351(2)(D)’’ and inserting ‘‘section 2
3351(3)(D)’’; and 3
(D) in clause (vi), by striking ‘‘section 4
3351(2)(A)’’ and inserting ‘‘section 5
3351(3)(A)’’. 6
(b) E
STIMATES OFIMPROPERPAYMENTS AND RE-7
PORTS ONACTIONSTOREDUCEIMPROPERPAYMENTS.— 8
Section 3352 of title 31, United States Code, is amend-9
ed— 10
(1) in subsection (a)— 11
(A) in paragraph (3)— 12
(i) in subparagraph (B), in the matter 13
preceding clause (i), by striking ‘‘para-14
graph (1)’’ and inserting ‘‘paragraph 15
(1)(B)’’; and 16
(ii) in subparagraph (C), by striking 17
‘‘paragraph (1)’’ each place it appears and 18
inserting ‘‘paragraphs (1) and (4)’’; and 19
(B) by adding at the end the following: 20
‘‘(4) N
EW PROGRAMS AND ACTIVITIES .—In ad-21
dition to the programs and activities identified under 22
paragraph (1)(B) and subject to paragraph (5), the 23
head of an executive agency shall annually identify 24
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as susceptible to significant improper payments any 1
program or activity that— 2
‘‘(A) has or is expected to have outlays ex-3
ceeding $100,000,000 in any one of the first 3 4
fiscal years of operation; and 5
‘‘(B) is in the first 4 years of operation. 6
‘‘(5) E
XCEPTION.—Paragraph (4) shall not 7
apply with respect to any program or activity that 8
the head of the relevant executive agency concludes, 9
based on the results of a review conducted under 10
paragraph (1), is not susceptible to significant im-11
proper payments.’’; 12
(2) in subsection (c)(1)— 13
(A) in the matter preceding subparagraph 14
(A), by striking ‘‘subsection (a)(1)’’ and insert-15
ing ‘‘paragraph (1) or (4) of subsection (a)’’; 16
and 17
(B) by striking subparagraphs (A) and (B) 18
and inserting the following: 19
‘‘(A) produce a statistically valid estimate 20
of the improper payments made under the pro-21
gram or activity, or an estimate of such im-22
proper payments that is otherwise appropriate 23
using a methodology approved by— 24
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‘‘(i) the Director of the Office of Man-1
agement and Budget; and 2
‘‘(ii) the chief financial officer of the 3
executive agency; and 4
‘‘(B) report the estimates described in sub-5
paragraph (A) in accordance with subsection 6
(j).’’; and 7
(3) by adding at the end the following: 8
‘‘(j) A
NNUALREPORTS.—Any annual report required 9
to be made by the head of an executive agency under this 10
section shall— 11
‘‘(1) be included in the materials accompanying 12
the annual financial statement of the executive agen-13
cy and, as required, in applicable guidance of the Of-14
fice of Management and Budget; and 15
‘‘(2) include a statement by the chief financial 16
officer of the executive agency— 17
‘‘(A) certifying the reliability of the execu-18
tive agency’s identification of programs and ac-19
tivities that may be susceptible to significant 20
improper payments under subsection (a); and 21
‘‘(B) describing the actions of the chief fi-22
nancial officer of the executive agency to mon-23
itor the development and implementation of any 24
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corrective action plans reported under sub-1
section (d).’’. 2
(c) F
INANCIAL ANDADMINISTRATIVECONTROLSRE-3
LATING TOFRAUD ANDIMPROPERPAYMENTS.—Section 4
3357 of title 31, United States Code, is amended by strik-5
ing subsection (d) and inserting the following: 6
‘‘(d) R
EPORTS.— 7
‘‘(1) I
N GENERAL.—For each fiscal year begin-8
ning in the first fiscal year after the date of enact-9
ment of the Safeguarding the Transparency and Ef-10
ficiency of Payments Act, and in each of the fol-11
lowing 9 fiscal years, the head of each agency shall 12
submit to Congress, in the report containing the an-13
nual financial statement of the agency, a report— 14
‘‘(A) on the progress of the agency in— 15
‘‘(i) implementing— 16
‘‘(I) the financial and administra-17
tive controls required to be established 18
under subsection (c)(1); 19
‘‘(II) the fraud risk principles in 20
the Standards for Internal Control in 21
the Federal Government of the Gov-22
ernment Accountability Office; and 23
‘‘(III) Circular A–123 of the Of-24
fice of Management and Budget with 25
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respect to the leading practices for 1
managing fraud risk; 2
‘‘(ii) identifying fraud risks and 3
vulnerabilities, including with respect to 4
payroll, beneficiary payments, grants, large 5
contracts, and purchase and travel cards; 6
and 7
‘‘(iii) establishing strategies, proce-8
dures, and other steps to curb fraud; and 9
‘‘(B) that includes information on the sta-10
tus of implementing each of the 11 leading 11
practices identified in the report published by 12
the Government Accountability Office on July 13
28, 2015, entitled ‘Framework for Managing 14
Fraud Risks in Federal Programs’. 15
‘‘(2) I
NFORMATION IN REPORT .—If the annual 16
financial statement of an agency, or an alternative 17
report of the agency included in the annual financial 18
statement, includes information that fulfills the re-19
quirements of this subsection, the head of the agen-20
cy may include a brief statement to that effect in the 21
financial statement or alternative report without du-22
plicating the information required under this sub-23
section in a separate or standalone report.’’. 24
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SEC. 3. NO ADDITIONAL FUNDS. 1
No additional funds are authorized to be appro-2
priated for the purpose of carrying out this Act or the 3
amendments made by this Act. 4
Æ
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