The Highly Visible Invisible OFPP Administrator

Obama is reforming contracting with no administrator, and he doesn't seem to mind

Just four weeks after being sworn in as president, Barack Obama signed into law the massive stimulus legislation, complete with $787 billion to spend and significant changes to the government’s contracting regulations.

Two weeks later, Obama declared contracting reform to be a top priority for his administration and issued a memo on some of the changes he had in mind. Since then, he has frequently stated what he sees as a dire need for reforms and oversight of contractors.

Obama signed another bill in May that changed the rules for the Defense Department's procurement of major weapons systems.

Through all of this, he seems to be missing a key player: the administrator of the Office of Federal Procurement Policy.

Obama has chosen a national chief information officer — Vivek Kundra — and picked Aneesh Chopra to be chief technology officer. They quickly became prominent figures, and Kundra has pushed technology as an important part of acquisition reform.

But the president has no procurement policy chief.

The Office of Management and Budget has issued guidance on how agencies are supposed to spend the stimulus money, approved numerous new regulations and nearly completed a definition of inherently governmental functions.

But no chief.

In theory, the OFPP administrator is a key player in anything to do with government acquisition and is downright essential during times of major reform. Nevertheless, the changes are apparently moving along without an administrator. Some experts have started to wonder if the role is as important as others had assumed.

However, the push to find a nominee is building now that OMB’s deputy director for management, Jeff Zients, has been confirmed, said Kundra, who is involved in the search for an OFPP leader.

Even so, the administrator’s desk remains empty, while outside, the acquisition and contracting world is spinning faster than ever.

“There’s something to be said for somebody who knows how to grab on to things that are already in motion,” said Allan Burman, president of Jefferson Solutions, a division of Jefferson Consulting Group.

As the world turns

The government is witnessing some of the biggest changes in contracting in more than a decade. Obama took an about-face from President George W. Bush in a memo issued March 4 that comments on the troubled area of contracting and indicates how important he considers reforming the system.

Experts say the OFPP leader will be in a powerful position. He or she will have the president’s ear and a big agenda to tackle — bigger than in many past administrations.

“This is going to be a highly visible job with senior-level interest in what’s going on,” said Burman, who was acting administrator of OFPP starting in 1988 and confirmed in that role in 1990.

Obama wants tighter oversight of noncompetitive contracts and those without fixed prices. He wants an acquisition workforce that is capable of overseeing contractors. He has also told agencies to use outsourcing only when it’s absolutely necessary so the government can wean itself off its dependence on the private sector.

The American Recovery and Reinvestment Act, which Obama signed into law in February, is disbursing billions of dollars to save the economy, and the law dictates how agencies can spend that money and what contractors must report on when they get the cash. Experts say those rules have set a new standard for acquisition transparency and reporting and thus will spread to all government contracting in the near future. They say a leader needs to guide those changes appropriately.

A few blocks from the empty OFPP administrator’s office, Congress is passing reform legislation. Members are changing small-business set-aside rules and thinking about ways to revamp DOD’s acquisition system so the department can buy information technology faster. Many acquisition experts believe Congress makes rules without really understanding the issues. And that’s another reason it’s important to have an OFPP administrator.

All this activity is happening while the government remains on a fast track to spend $600 billion a year.

Then there’s the acquisition workforce. It’s overworked and demoralized. Employees are waiting for a strong leader to offer them some relief. For several years, they have felt battered by intense scrutiny by Congress, inspectors general and the Government Accountability Office. They want a leader high in the Obama administration’s ranks to protect them.

Catching up

When finally confirmed by the Senate, the administrator will need to sprint to catch up with what’s been happening in the acquisition field, said Angela Styles, OFPP administrator from 2001 to 2003 and now a partner at Crowell and Moring’s Government Contracts Group.

The White House has been working for months to draw up memos and craft a strategy. Most important for OFPP, Obama has brought the traditionally back-office duties of negotiating and signing contracts to the forefront of his agenda.

“We’ll have to break bad habits that have built up over many years,” he said. “But we can’t keep spending good money after bad.”

The first test of the new OFPP administrator’s authority will be how far he or she can stray from the goals Obama outlined in his March 4 memo, according to one expert.

Steve Kelman, administrator of the Office of Federal Procurement Policy from 1993 to 1997 and now a Harvard University professor and Federal Computer Week columnist, said the memo reads more like something written by lawmakers than a document crafted by experts in contracting.

He said the OFPP administrator must wrestle with nitty-gritty acquisition issues, such as how to navigate performance-based contracting and improve the use of contractors’ past-performance information in making awards. The administrator also has to continue melding contracting officers, their technical representatives and program managers into a team as they manage millions of contracts.

Kundra, who is pushing for a speedier, simpler acquisition process, said the OFPP administrator must understand the challenges of government procurement while also believing that the government needs to find faster ways to buy ever-evolving IT.

The administrator should “recognize we can’t treat technology procurements in the same way we do buying buildings,” Kundra said.

Furthermore, a report from industry and government experts urges the administrator to compel agencies to approach acquisitions holistically when they write contract requirements. The administrator will need to improve communication between agencies and industry, the said, and he or she will need to convince employees that technological innovations can improve the acquisition process.

Unfortunately, the delay in naming an OFPP administrator means “people are always going to know you weren’t the one who wrote the agenda,” Styles said. Therefore, the administrator will need to find a way to embrace and personalize the administration's priorities.

Styles said she received her priority — competitive sourcing — from Bush administration officials, but she was involved in drafting the procurement policy from the start because she was nominated in March 2001 and confirmed three months later. Her role was to implement the ideas of her bosses. The same will be true for the next administrator, she added.

When a key position remains vacant while other officials lack deep knowledge of an issue, it can result in a misguided — if not directionless — agenda, said Bob Woods, commissioner of the General Services Administration’s Federal Technology Service from 1994 to 1997 and now president of Topside Consulting. That’s the sort of situation the new OFPP administrator will face.

"You don't want to be the last wolf to the feast," he said. "There’s been a lot of chewing going on since you've not been there."

Missing person

The longer the position remains unfilled, the more some experts question its importance. Congress and the administration seem to be setting policies just fine without an OFPP administrator, they say.

“Here we are in August, and we don’t have a nominee yet,” said Robert Burton, former OFPP deputy administrator and now a partner at Venable law firm. “It’s obviously not a priority yet.”

Burton pointed out that Lesley Field is doing a fine job as acting OFPP administrator, and he questioned the urgency of choosing a permanent administrator. “It’s not like the initiatives don’t go forward,” Burton said. “It’s not like the career people don’t talk with other offices.”

OFPP would work just as well with a career employee in charge, who would likely stay longer than the typical two-year tenure of most OFPP administrators, Burton said [tk: ok?]. Plus, he or she would have the added benefit of understanding the issues involved after having risen through the office’s ranks.

“Acquisition is nothing but a lot of rules and regulations,” and it demands a strong legal background, not a political connection, Burton said. Deputy administrators work on many aspects of reforms, and they’re often dealing with agency leaders on regulations. Burton also ran OFPP during many of his years there as administrators came and went.

Kelman said there are benefits to appointing a retired career acquisition official to be OFPP administrator because that person wouldn't need a crash-course in what’s happening and why.

In the meantime, highly visible officials are talking about innovative acquisition reforms. For example, Kundra is calling for saving money through an IT storefront, cloud computing and software-as-a-service initiatives. He wants to use technology to speed the slow and deliberate acquisition process. And the tech-savvy Obama administration is putting a lot of weight behind Kundra.

“The administration is making that post very visible,” Burton said. Kundra’s prominence might suggest the decline of the OFPP administrator’s role as a leader in acquisition reform, Burton added.

However, Deidre Lee, OFPP administrator from 1998 to 2000 and now executive vice president of federal affairs and operations at the Professional Services Council, said Kundra could be a strong ally of the OFPP administrator.

“Two or three people at that high of a position with like minds can do a lot,” she said.

Although neither of them has much statutory authority or budget control, “one of the most important things anyone can have is a bully pulpit,” Kelman said. The two leaders could inspire people and soothe an anxious acquisition workforce, he added.

Only a few people are capable of doing that. Lee said that when acquisition employees make a mistake, the administration’s “leadership has got to step up there and say, 'Yep, we tried it, made a mistake, noted [it] and moved on. Let’s try again.'”

Everything is in place to move the workforce forward with the innovations that technology allows, experts say, but people are waiting for leaders to show them the way.

“I think the lion’s share is ready, but it’s going to take a lot of courage,” said John Nyce, associate director of the Acquisition Services Directorate at the Interior Department’s National Business Center. He added that they’re looking for someone to stand up for them.

Lee said the workforce is in huddle mode. Employees have learned that they can avoid attention by not moving forward. “That’s why leadership is so critical,” she said.

And employees understand that a political appointee has more access to key decision-makers. “The better the relationships, the better job you do,” Styles said, mentioning Kelman and David Safavian, who was OFPP administrator from 2004 to 2005 until he resigned during a scandal.

Some experts believe the administrator should remain a political appointee, even if a career person is just as capable. That approach ensures respect from other appointees throughout the government and shows that the administrator shares the president’s goals and agenda.

Furthermore, the president’s support for the administrator will make employees listen to what he or she has to say and pay attention to the direction they’re headed.

“A lot of the workforce longs for good leadership,” Kelman said. “And it’s up to that person to show he’s willing to go out of his way to work for them.”

Read the story: FCW.com News - Acquisition reforms rush forward while top OFPP seat remains empty

Kundra aids search for procurement leader

Top IT official believes procurement policy must be flexible

Six months have passed since President Barack Obama took office, and the chair reserved for the leader of the Office of Federal Procurement Policy remains empty. Now Vivek Kundra, the federal chief information officer, is helping the administration look for a suitable nominee.

Kundra is drawing on his information technology expertise and mandate to seek an OFPP administrator who will “recognize we can’t treat technology procurements in the same way we do buying buildings,” he said.

Jeffrey Zients, deputy director for management at the Office of Management and Budget, is the point man for the quest. Finding the next OFPP administrator has been a top priority for Zients since his Senate confirmation on June 19. No one has been nominated for the OFPP post, and there are few rumors about whom the candidates might be.

However, experts expressed surprise that CIO Kundra is so actively involved in the search.

Bob Woods, president of Topside Consulting and former commissioner of the General Services Administration’s Federal Technology Service, said agencies conduct a broad array of procurements. Buying battleships and buying large quantities of paper are different kinds of procurements, and Kundra's involvement might signal an over-emphasis on IT, Woods said.

Nevertheless, Kundra has campaigned vigorously for simplifying the buying process. “Everyone in government shouldn’t have to have a Ph.D. in procurement,” he said. “Why is it so complex?”

During a discussion July 27 with reporters and editors from the 1105 Government Information Group, parent company of Federal Computer Week, Kundra said the government needs to do a better job of using technology to make the whole process easier.

Kundra has proposed creating a virtual storefront where agencies could quickly buy services, such as cloud computing. Although he said GSA’s Multiple Award Schedules program and GSA Advantage Web site have many benefits, he said there are even faster ways to work. Each time an agency wants to buy IT, it shouldn’t have to start a two-year procurement process, he said, adding that by the time the contract is awarded, the technology is outdated.

However, many experts say the process isn’t always that time-consuming.

Kundra said his intent is to make buying IT easier and more intuitive via his proposed virtual storefront, which would mirror systems in the commercial marketplace, such as Amazon.com and eBay.

That approach may not fly, say critics. “At some point, he’s going to have to come to terms with the fact that the government is built to be inefficient,” said one government official, who spoke on condition of anonymity. Companies such as Amazon and eBay don’t contract with the government because they don’t want to have to abide by the government's rules, the official added.

Read the story: FCW.com News - Kundra aids search for procurement leader

Senate passes bill with HUBZone change

Bill deals with small-business equality issue


The Senate has passed its fiscal 2010 National Defense Authorization Act (S. 1390) with a provision that would remove the “shall” in the law that some government attorneys say gives small businesses in historically underutilized business zones (HUBZones) first preference when a contracting officer considers setting aside a contract for small businesses.

The mandatory “shall” would become a “may,” which would give the officers more discretion in awarding the contracts.

Since May, the Government Accountability Office, the Small Business Administration and the Office of Management and Budget have been debating whether HUBZone businesses should get priority over service-disabled veteran-owned small businesses and firms in SBA's 8(a) program. Read the story. The Senate passed the legislation July 23.

Rep. Roscoe Bartlett (R-Md.), co-chairman of the HUBZone Caucus, today said he supports the statutory change.

“Small-business owners from these three categories endure different types of disadvantages, but they all create invaluable opportunities and magnified benefits in our communities. They deserve equal priority consideration for federal government small-business contracts,” he said.

The Senate passed the legislation July 23.

Also regarding acquisition reforms, the bill would require a Defense Department contracting officer to justify why a contract worth more than $20 million should be awarded on a sole-source basis. For example, the officer would have to show that the anticipated costs are fair and reasonable. The bill would also tighten restrictions on public/private competitions for government work. The competitions pit the two sectors against each other to see who can do the work best for the lowest price.

The House passed its version of the bill in June. A conference committee of senators and House members will work out the differences before sending the legislation to the president.

Read the story: FCW.com News - Senate passes bill with HUBZone change

Senate deal will level small-business contract preferences

HUBZone companies would not get priority over 8(a) companies and service-disabled veteran business owners

Senate leaders have agreed to include a provision in the next defense authorization bill to do away with the current debate over which categories of small businesses should be given priority in federal contracting.

The amendment, introduced by Sen. Mary Landrieu (D-La.), would remove the special preference given to small businesses in historically underutilized business zones (HUBZones), putting those firms on a par with companies owned by service-disabled veterans and those in the Small Business Administration’s 8(a) program.

“All small businesses should be given an equal opportunity to succeed,” said Landrieu, chairwoman of the Small Business and Entrepreneurship Committee.

The Senate is currently considering the fiscal 2010 National Defense Authorization Act ( S. 1390 ). The House passed its version in June.

Landrieu said her amendment is in response to a May ruling by the Government Accountability Office that HUBZone companies had to be considered before other categories of business when conducting a set-aside procurement. She said the ruling has caused contractors to pull back business from 8(a) and service-disabled veterans programs.

In its decision, GAO said the Army made a mistake when it didn’t consider whether at least two HUBZone businesses would bid on an information technology contract. Mission Critical Solutions, a HUBZone company, protested the award after the Army awarded a one-year, $3.45 million sole-source contract to Copper River Information Technology, a company owned by Alaska Natives.

SBA and administration officials also object to GAO’s decision. They say it conflicts with SBA's long-standing regulations and its view that 8(a) companies and those owned by service-disabled veterans and HUBZone companies are all equals. On July 10, OMB told agencies to disregard GAO’s decision.

“If agencies were to follow the GAO decisions, the federal government’s efforts to procure goods and services from 8(a) small businesses and from [service-disabled, veteran-owned small businesses] through the other statutory programs may be negatively impacted,” Office of Management and Budget Director Peter Orszag wrote on July 10.

Read the story: WashingtonTechnology.com News - Senate deal will level small-business contract preferences

Congress, administration move into protected territory

The governmnent is having an ongoing debate about certain small businesses with big advantages

Congress and the Obama administration have stepped into a well-guarded territory of small-business contracting: special advantages.

The Senate Homeland Security and Governmental Affairs Committee’s ad hoc Contracting Oversight Subcommittee has questioned whether the explosive growth in Alaska Native Corporations’ (ANCs) contracting dollars in the last eight years through unique set-aside rules has given ANCs too much of an advantage. The subcommittee held a hearing July 16 that has become part of an ongoing debate about some categories of small businesses that live by special rules.

“The current situation is out of balance, and it may be time to swing the pendulum back the other way,” said Mark Lumber, senior vice president for federal program for Cirrus Technology, a historically underutilized business zone (HUBZone) small business in Huntsville, Ala.

Sen. Claire McCaskill (D-Mo.), the subcommittee chairwoman, asked several representatives for ANCs if they would agree with changes to make ANCs abide by the same rules as Indian tribes and other socially and economically disadvantaged companies.

If there is no difference between them, she said, “Then I hope that you would accept a change in the law that would make sure that you are on completely equal footing."

The ANC representatives at the hearing remained neutral. “We are not in a position today, through our organizations, to negotiate on behalf of our people. We need to go through an extensive tribal consultant process,” said Susan Lukin, executive director of Native American Contractors Association.

Officials believe ANCs are getting a disproportionate amount of money compared to other small businesses, according to reports. Because of ANCs’ rules, the amount of contracting dollars going to ANCs have grown by 1,386 percent since fiscal 2000 and have tripled from $1.1 billion in 2004 to $3.9 billion in 2008, according to the Small Business Administration’s inspector general. In SBA’s 8(a) small business program in 2008, ANCs were awarded 26 percent of the total dollars flowing into the program, although they are only 2 percent of the total number of companies in the program, according the IG’s July 10 report.

Similarly, McCaskill’s subcommittee analyzed information from 19 ANCs and found similar results. ANCs received $6.6 billion in 8(a) multi-million-dollar sole-source contracts between 2000 and 2008, according to its report.

The increases are a result of agencies’ small-business contracting goals and, more importantly, a quick way to award a contract, officials say. Rules that are unique to only ANCs allow agencies to award them sole-source contracts of any size without competition, and no fear of bid protests.

Sen. Susan Collins (R-Maine), the subcommittee’s ranking member, said Congress needs to carefully consider whether the 8(a) program rules offer too many benefits to ANCs at the expense of the others.

In the private sector, many business owners are upset by the set-aside partiality ANCs receive. Lumber said few people would object to ANCs having some type of procurement preference, but not that allows for this much advantage.

At the same time, HUBZone businesses get a deal that upsets many other business owners and the Obama administration. It’s a difference of a word: "Shall" versus "may."

Office of Management and Budget Director Peter Orszag on July 10 told agencies to disregard the Government Accountability Office’s (GAO) May 4 bid protest ruling that said HUBZone small businesses get first crack at a contract set-aside. GAO rejected SBA's request to reconsider its rulings.

Because of language in a 1997 authorization law, GAO sustained two bid protests in favor of HUBZone businesses. As a result, GAO ruled that those companies get priority over all 8(a) small businesses and companies owned by service-disabled veterans.

“You’ve got to live by the ‘shall,’ ” said Robert Burton, former deputy administrator of the Office of Federal Procurement Policy and now a partner at the Venable law firm.

While GAO believes the “shall” in the law is a mandate, SBA officials said the 8(a) companies, service-disabled veterans, and HUBZone companies should all be equal to each other.

John Moliere, an advocate service-disabled veteran contractors and president of Standard Communications, said, "I envision the lawyers at GAO smugly pleased with their decision."

Meanwhile, the HUBZone Contractors National Council isn't talking about the disagreement between GAO and OMB.

If Congress or the administration tries to make any changes to these sensitive areas, Burton said it won’t be an easy legislative fix. There are members of Congress who will fight to keep things as they are. Both of Alaska’s senators, who weren't members of McCaskill's subcommittee, took advantage of the special privilege to question witnesses at the ANC hearing. They both also thrust their strong support behind the Alaska Natives.

Over all, Moliere said, “This is not the end of this skirmish. It will erupt in a full-fledged battle.”

Read the story: FCW.com News - Congress, administration move into protected territory

GAO rejects request to review HUBZone decisions

SBA and OMB contend GAO overreached its authority in ruling that HUBZone businesses have priority

The Government Accountability Office today denied Small Business Administration officials’ request to reconsider recent bid protest decisions that give some small businesses priority over others.

SBA’s request “is denied where newly raised information fails to show that our prior decision contains any errors of fact or law,” GAO’s Acting General Counsel Daniel Gordon wrote in a decision released today.

SBA and the Office of Management and Budget Director Peter Orszag contended GAO overreached its authority when it ruled that firms in historically underutilized business zones (HUBZones) should get priority over small businesses in the SBA’s 8(a) program or service-disabled, veteran-owned small businesses.

GAO’s rulings are not binding on federal agencies and are contrary to SBA regulations, Orszag wrote in a memo released to agencies July 10.

“If agencies were to follow the GAO decisions, the federal government’s efforts to procure goods and services from 8(a) small businesses and from [service-disabled, veteran-owned small businesses] through the other statutory programs may be negatively impacted,” Orszag wrote.

He also wrote that the rulings remove contracting officers' discretion to set aside a contract. Until administration attorneys finish their legal review, Orszag wrote that contracting officers should continue using SBA's view of the three types of small businesses. Federal agencies should not “prioritize HUBZone small businesses over” 8(a) or veteran-owned companies, he wrote.

The administration’s concerns come from a May 4 ruling on a protest by Mission Critical Solutions, a HUBZone company. GAO ruled that the Army made a mistake and didn’t consider whether at least two HUBZone businesses would bid on an information technology contract. Instead, the Army awarded the one-year, $3.45 million sole-source contract to Copper River Information Technology, a company owned by Alaska Natives. Law allows Alaska Native corporations to receive sole-source contracts of any size.

GAO based its decision on the Small Business Reauthorization Act of 1997. The legislation states that “a contract opportunity shall be awarded” on the basis of a set-aside competition among HUBZone companies. Meanwhile, Congress didn’t afford companies in SBA’s 8(a) program or companies owned by service-disabled veterans the same mandate. The law only says contracting officers may set aside a contract to those types of companies.

“We do not think SBA’s regulatory implementation of HUBZone and 8(a) statutes is reasonable since it fails to give effect to mandatory language of the HUBZone statute,” the decision in the Mission Critical Solutions case states.

GAO reached a similar conclusion in September 2008, when it considered a bid protest from International Program Group, another HUBZone company. The Marine Corps set aside a contract for service-disabled veterans before considering whether a HUBZone set-aside would be appropriate. GAO ruled against the Marines.

Read the story: Washingtontechnology.com News - GAO rejects request to review HUBZone decisions

DOD’s use of services contracts gets congressional scrutiny

The House version of the 2010 National Defense Authorization Act would require the Defense Department to hire an outside organization to assess its use and oversight of services contracts.

The House Armed Services Committee believes DOD doesn't have a strategic approach to managing its service contracts, according to the committee’s June 18 report on the authorization bill (H.R. 2637).

As a result, “the department is at risk of being unable to identify and correct poor contractor performance in a timely manner and is at risk of paying contractors more than the value of the services they performed,” the committee wrote.

The House passed the bill June 25 by a vote of 389-22. The Senate committee has marked up its version of the bill, but the committee has yet to approve it.

Under the House bill, the assessment would be conducted by a federally funded research and development center. The center would look at the guidance DOD provides its acquisition workforce on how to develop a services contract, including how to define requirements and the associated performance metrics.

The center also would look at whether or not DOD has enough people in its acquisition workforce to do the work appropriately. The report would be due in March 2010.

Rep. Ike Skelton (D-Mo.), chairman of the House Armed Services Committee, said the legislation supports the Defense Secretary Robert Gates' plan to increase the civilian acquisition workforce’s size and to reduce DOD’s reliance on contractors for critical acquisition duties. DOD officials want to hire 9,000 new government employees and convert 11,000 contractor jobs to DOD civilian personnel.

“Defense acquisition reform is a top priority for our committee,” Skelton said in statement June 17 after his committee approved the legislation.

In another acquisition reform, the committee wants to find ways for DOD to buy IT more quickly.

IT systems require regular updates, because of changes in technology, which affects critical parts of the DOD infrastructure. But DOD’s process for buying IT makes it difficult for the department to keep up, according to a DOD task force.

The acquisition process is time-consuming and cumbersome, the task force wrote in a March report. "The process should be agile and geared to delivering meaningful increments of capability in approximately 18 months or less."

The House bill would allow DOD to pick 10 IT programs every year in which to test new procurement processes.Acquisition reforms in the House's fiscal 2010 National Defense Authorization Act concentrate on oversight of service contracts and buying information technology quickly.

Read the story: FCW.com News - DOD’s use of services contracts gets congressional scrutiny

GSA contract expiration reflects market needs, experts say

GSA official says many GWACs won't be renewed as GSA markets its Alliant and Alliant Small Business contracts

The General Services Administration's plan to let many of its governmentwide information technology contracts expire, largely ending the era of big governmentwide acquisition contracts (GWACs), reflects the evolving needs of the market, experts say.

They say the federal IT market’s sales have been driving GSA to end and merge GWACs for several years now. There are too many GWACs, causing too much overlap of services. The result is scattered sales while the cost of running the contracts still dips deeply into GSA’s pockets.

GSA will continue to support only Alliant, its small-business companion contract and a few GWACs targeted to companies in specific socioeconomic categories, said Ed O’Hare, assistant commissioner of the Office of Integrated Technology Services at GSA’s Federal Acquisition Service.

For the long term, though, GSA will likely merge the GWAC program with the widely used Multiple Award Schedules program. “But that will take years, not months,” O’Hare said.

Before ending the GWAC program, GSA will first winnow down the number of marginally performing GWACs, such as Commerce Information Technology Solutions-NexGen, said Larry Allen, president of the Coalition for Government Procurement. In recent years, GSA has taken over several GWACs, such as COMMITS from the Commerce Department, and now the agency needs to streamline its efforts, he added.

GSA has said for more than a year that the overlapping GWACs are expensive for government and industry and should be pared down, said Bill Perlowitz, vice president of advanced technology at Apptis. No one should be surprised that the agency is saying it won’t renew many GWACs, particularly given the Obama administration’s desire for a more efficient government.

“GSA would be streamlining things” to close down or merge GWACs into its schedules program, said Hope Lane, officer of government contracts consulting at Aronson and Co.

Total IT sales figures have slipped slightly in the past several years. The fallout in 2004 over GSA’s mishandling of the Defense Department’s money has caused some DOD customers to turn to other IT contracts, such as the Navy Department’s SeaPort-e, Lane said.

Meanwhile, sales on GSA’s massive Schedule 70 have remained relatively flat at about $17 billion annually for the past three years, according to government figures.

The recently awarded Alliant and Alliant Small Business GWACs, which were delayed for two years, have a wide choice of services, which makes many other GWACs unnecessary, experts say.

"You can get pretty much anything you want from Alliant," Lane said.

Courtney Fairchild, president of Global Services, said GSA’s Alliant contracts, which were awarded earlier this year, were always meant to replace the expiring GWACs.

“I suppose the real question for industry is whether or not government agencies have enough faith in the Alliant contract to switch over,” she said.

Agencies that shy away from Alliant will still have the option to work with one of more than 15,000 companies in the schedules program.

GWACs offer options to agencies that the schedules program can’t, such as cost-reimbursement contracts. Unless GSA can tweak the schedules program’s rules to change that, GWACs will always have a place, Allen said.

In addition, GSA would have a tough time closing the socioeconomic-based GWACs, such as the 8(a) small-business Streamlined Technology Acquisition Resources for Services and the Veterans Technology Services GWACs.

“Would you want to stand before Congress and try to explain why you ended those contracts?” Allen asked.

On the other hand, any attempt to merge the GWAC and schedules programs would be “consistent with the spirit and message of the creation of the recent Federal Acquisition Service,” Fairchild said.

The reorganization of the Federal Technology Service and the Federal Supply Service into FAS allowed GSA to scrap dueling and repetitive contracts that might confuse customers.

Read the story: Washingtontechnology.com News - GSA contract expiration reflects market needs, experts say

Acquisition workforce: Social media could be big draw

The government acquisition community ought to take a cue from President Barack Obama’s campaign strategy and use social media technology to bolster its ranks, one lawmaker says.

The government needs to be brave enough to draw on the younger generation’s new ways of interacting to help attract them to government service and to simply improve how agencies run, said Rep. Brian Bilbray (R-Calif.), speaking at a congressional hearing last week.

Many older federal employees may not be as comfortable with that technology, but the up-and-coming employees live by it. “This is their primary way of thinking,” he said.

Obama’s campaign captured young people’s attention like no other presidential candidate has before. It created Change.gov, a hip Web site describing Obama’s agenda. But Obama also sent out text messages and had a presence on Facebook, MySpace and numerous other social networking sites. Obama posted videos on YouTube. He even tweeted.

As a candidate, Obama was “a socially enabled, socially connected, socially aware, socially conscious leader,” Barry Libert, author of “Barack, Inc.: Winning Business Lessons of the Obama Campaign,” said in a recent speech.

At the hearing, Bilbray said the older generations that didn’t grow up with this technology will always be somewhat blind to it, unlike the younger people who have never known life without that technology.

“First of all, it intimidates us to some degree, and we may not understand it. But the potential is huge,” he said.

The next generation is heading toward more Web 2.0 tools and collaboration from the crowd.

The General Services Administration already has a technology-rich culture, said David Drabkin, acting chief acquisition officer at GSA, who testified at the hearing. The agency is adopting cloud computing and Web 2.0 collaboration tools internally and using social networking sites such as Facebook to interact with the public.

“We are on the edge,” he said.

Mary Davie, assistant Federal Acquisition Service commissioner for assisted acquisition services at GSA, is already thinking about the application of social media to acquisition. In a column in this week’s print edition of Federal Computer Week, Davie suggests opening the process of defining an acquisition’s requirements to get insight from a community of experts, inside or outside of the government.

“Using the wisdom of the crowd to define requirements and the best development process, participants could propose ideas based on experience, good practices, and standards, question and weed out bad ideas, build on one another’s ideas, and float the best to the top,” she writes.

Like Bilbray, Davie sees an opportunity not only to improve procurement but to appeal to younger recruits.

“Imagine what this might do to attract and retain the Net Generation workforce we are always seeking out,” Davie wrote.

At the hearing, Shay Assad, acting deputy undersecretary of defense for acquisition and technology, said technology will bring major changes in acquisition during the next two years.

The department is developing a database that will give Defense Department contracting officials quick access to information on business deals across the department, such as how the department negotiates with certain contractors, what they buy, and how much they may.

The system will be based on information collected by the Defense Contract Management Agency, which is the hub for analysis of the value and costs of DOD’s procurements.

At present, the individual services often don’t share information and know little about what the other services are buying, even from the same contractor, Assad said. “The fact of the matter is that we are not as capable as a number of organizations in terms of being able to share that information, but we are getting there,” he said.

Read the rest of the story: FCW.com News - Acquisition workforce: Social media could be big draw

GSA looks to corral former customers

Procurement agency tries to win back lost business

Good news hasn't come very often to the embattled General Services Administration in recent years. So when some positive attention does come its way, GSA officials are eager to wave the results in front of its old go-it-alone customers — if only to show them that the agency has left its bad habits in the past.

Auditors from the Defense Department and GSA have been examining GSA’s books, and agency officials are confident the outcome will reveal that GSA can toe the regulatory line, said Ed O’Hare, new assistant commissioner for integrated technology services at GSA’s Federal Acquisition Service.

“We are confident we made the changes we needed to make, and we’ll fly through,” he said in a speech delivered in May.

Meanwhile, his marketing people are gathering a list of multiagency contracts and indefinite-delivery, indefinite-quantity contracts that other agencies launched around the same time GSA was found to be assisting the Defense Department with illegal purchases. O’Hare is targeting his message of repentance to the officers in the agencies whose own IDIQs are about to expire. The contracts often last for five to 10 years.

He wants to convince those agencies that GSA is ready to take over the other IDIQs, relieving other agencies of the maintenance burdens that come with running a large contracting program.

His question is simply: “Do you really want to do this again?”

For added emphasis, O’Hare also intends to highlight GSA’s inexpensive usage fees. Agencies pay a 0.75 percent service fee to use the Alliant GWAC, and GSA is capping that fee at $150,000 a year.

“I defy anyone to do a GWAC less expensively than that,” O’Hare said.

GSA’s ‘come to Jesus’ moment

Although GSA says it has moved past the scandal that rocked it five years ago, the memories — and history — linger. On Jan. 8, 2004, the GSA inspector general reported a pervasive problem of improper task orders and contract awards by the agency’s client support centers (CSCs), which served DOD. The IG found that some GSA employees were using the Information Technology Fund for purchases of goods and services that were well outside the fund’s scope. As a result, DOD officials banned use of GSA for major purchases.

The list of GSA’s sins grew long, according to the IG: improper sole-source awards, allowing work outside the scope of contracts, and inappropriately using time-and-materials task orders. Although the IT fund is authorized only for acquiring IT equipment, software and related services, investigators found that CSCs were dipping into it to pay for a wide variety of inappropriate things, such as marine barriers, pathogen detection devices, and construction of classrooms and office buildings.

The GSA IG attributed the problems to a culture that emphasized revenue growth instead of adhering to proper procurement procedures.

“I think every organization has to have a ‘come to Jesus’ moment,” said David Drabkin, GSA’s chief acquisition officer. That IG report was GSA’s moment.

Although the problems applied only to one small piece of GSA’s operation, the public perception was that the agency was more broadly compromised. “One part of your business does badly, and it hurts everybody,” Drabkin said.

DOD customers were frustrated with GSA and showed it in 2004 and 2005. Sales in the multiple-award schedules program slowed, but the program kept GSA from losing money year over year, Drabkin said.

But O’Hare and Drabkin said the agency has reorganized and revamped its operations. GSA is a new place compared to several years ago. And with the problems solved, GSA is ready to work. This latest round of audits, as required by the fiscal 2007 National Defense Authorization Act, should close the file on GSA as a poor broker of procurement dollars, O’Hare said.

Good news

Kevin Carroll, former program executive officer for the Army’s enterprise information systems who was in charge of the Information Technology Enabled Services-2S contract, said the new audit results can only help GSA rebuild its image and agencies’ trust in it.

“They’re showing responsibility,” said Carroll, president of the Kevin Carroll Group. But, he said, GSA also must continue to re-establish and develop its business relationship with DOD. Just showing good audit results won’t be enough.

Greg Rothwell, former chief procurement officer at the Homeland Security Department and president of Everymay Consulting Group, said there’s a deeper issue that might be too tough for GSA to surmount with a good audit: Agencies have become accustomed to doing their own contracting, and they aren’t likely to dump their contracts just to return to GSA.

Martha Johnson, President Barack Obama's nominee to be GSA administrator, said the agency has suffered its decline largely because of new freedom for agencies. Legislative changes in the 1990s, such as the Clinger-Cohen Act, removed many of the rules that required agencies to use GSA. It’s now one option among many.

“If you own it, you can control it,” said Rothwell, who helped to launch DHS’ Enterprise Acquisition Gateway for Leading Edge Solutions (EAGLE) contract and the Internal Revenue Service’s first two iterations of the Total Information Processing Support Services (TIPSS) contracts. “If you can’t control it, it can’t be as responsive to the agency’s mission.”

Faster, better, cheaper

The reality of control and GSA’s rough times forced it to cater to its customers and listen to them, experts say. For instance, GSA is letting agencies use contracts other than its own when GSA assists a customer agency.

GSA is scrambling to get started on launching ways for agencies to get on board with the Obama administration’s emphasis on cloud computing. Chief Information Officer Vivek Kundra and Chief Technology Officer Aneesh Chopra are advancing the administration’s policy, while GSA’s role could be to make it easy for agencies to use cloud computing services.

“We see the administration’s requirements, we respond by initiating some kind of contract action and make it fast and easy for government agencies to use,” O’Hare said.

He even wants to make cloud computing services available to agencies using a credit card, especially when they’re in a pinch for time.

“You don’t have to go to the CIO, you don’t have to go plan it, you don’t have to go buy servers or digital maps or do a [certification and accreditation]," he said. O'Hare envisions an agency employee logging on to a Web site, answering a few questions, and “boom, check out, you got it.”

O’Hare’s Office of Integrated Technology Services has awarded all of its major contracts, such as Alliant and Networx, and they’re ready for business. "I’ve got to get out there and talk to people and try to convince them we’ve already got it,” he said.

And he wants to make GSA work “faster, better and cheaper” than other agencies can offer. “My job is to make it work,” he said.

Read the story: FCW.com News - GSA looks to corral former customers

Think twice before insourcing government work

A report says the Obama administation should be careful before taking jobs from contractors and giving them to agencies

The Obama administration and Congress should proceed cautiously as they attempt to take work away from contractors and hand it to agencies' employees, according to a report released today.

“A rush to insource thousands of positions, while trying to take on ever more government programs, can end in disaster,” wrote Raj Sharma, president of the Federal Acquisition Innovation and Reform Institute, in a report titled "The Move to 'Insourcing'…Proceed with Caution."

Agencies should concentrate first on removing contractors from jobs already defined as inherently governmental and duties central to agencies’ missions, the report states. At the same time, officials need to consider insourcing other jobs in longer-term phases, he wrote, adding that the government can handle the shifting load much easier in stages rather than all at once.

“Rushing to undo what has been in the making for years — perhaps decades — will be counterproductive,” Sharma wrote.

Moreover, taking work from contractors must be done deliberately and based on facts, not innuendo and rhetoric, he wrote.

President Barack Obama often depicts contractors as taking advantage of the government.

However, contractors are a major component of how the government operates, Sharma said, and they often perform work that requires specialized expertise, Sharma added.

“The current rhetoric that demonizes all contractors, instead of those few that are guilty of fraud and abuse, will only deter the best suppliers that we so badly need from competing for government business,” he wrote.

He added that an essential component of success for Obama’s plans for health care reform, energy independence and social innovation will be the technical expertise, innovation and scale that industry can bring.

Meanwhile, experts say experienced federal employees are attractive to private-sector companies, which often offer more to those employees than the government does. Also, a large number of government employees are nearing retirement, and agencies’ acquisition jobs are remaining vacant because few people are seeking those jobs.

Obama’s calls to join public service can only do so much to help find people to do the work, Sharma wrote. The government needs to reconsider its recruiting efforts, pay and professional development policies to make them competitive with the private sector before agencies dramatically insource jobs.

“While it may be feasible to hire thousands of people during the current economic downturn, it will be difficult to retain this talent unless systemic human-capital issues are addressed,” he wrote.

Sharma said officials should answer the following questions before bringing work in-house:

Which positions should be insourced?
How and when should they be insourced?
What will attract the people needed to do the jobs once they are brought in-house?
How will the government retain the employees who are doing the insourced jobs?

Read the story: FCW.com News - Report: Think twice before insourcing government work

Contractors need to closely watch procurement changes

Obama administration and Congress advocate for new era of contracting

Contractors had better dust off their federal rules books.

With the Obama administration concentrating on increasing transparency and reducing contracting costs through procurement reforms and tougher checks on vendors, contractors have plenty to keep track of.

The tone from the administration is often negative, and in some of his statements, President Barack Obama has described contractors as abusers, intent on lining their pockets with federal money.

But some experts say companies aren’t as alert as they should be about changing rules environment.

“Contractors have to be much more vigilant,” said Robert Burton, former deputy administrator of the Office of Federal Procurement Policy and now partner at Venable law firm. “But lots of people are slow to get the message.”

In late May, federal officials took steps to more closely regulate contractors. On May 22, Obama signed the Weapons System Acquisition Reform Act (S. 454), which includes tighter regulations on contractor conflicts of interest.

Under existing rules, the Defense Department and its subsidiary agencies must determine on a case-by-case basis how they can reduce conflicts of interest. However, Congress said DOD must strengthen those requirements. For instance, the department needs to make sure contractors give objective and unbiased plans to guard against any possible conflict, according to the congressional conference report on the legislation.

At the bill signing ceremony, the president reiterated his view on contractors and why DOD needs to augment its conflict-of-interest restrictions.

“When it comes to purchasing weapons systems and developing defense projects, the choice we face is between investments that are designed to keep the American people safe and those that are simply designed to make a defense company or a contractor rich,” Obama said.


Target: Conflicts of interest

The conflict-of-interest provision in the new law highlights Congress’ push to close the lid on any contractors’ fingers before they reach into the federal cookie jar. But the Federal Acquisition Regulation has few details about conflicts of interest, and last year, Congress ordered OFPP officials to review the FAR to see if it needs more guidance. The subtle undertone in the order, which is in the fiscal 2009 National Defense Authorization Act, reveals that lawmakers believe in tougher regulations on conflicts of interest, but they aren’t sure how to apply them.

The complications of mandatory reporting rules stretch beyond actions on a single contract. Even if there is no clause mentioning ethics guidelines or reporting of overpayment or potential fraud, allegations of wrongdoing in this area can result in damage to a company's reputation that might be hard to shake. For one, there’s a government database that lists companies that have been accused of failing to act or adhere to contracting rules.

It’s a new era of mandates, Burton said. “That’s what’s changing acquisition now.”

However, some contractors are lax because they don’t think this affects them, especially if their contract has no specific clause, Burton said.

These days, with transparency and scrutiny in tandem, contractors need to be aware even of standard rules.

Exec pay draws attention

Beyond requiring a company to have an ethics program, officials are skeptical of excessive executive pay. In March, Obama said the government shouldn’t line the pockets of contractors. But agencies, particularly DOD, must direct tax dollars to fulfill the nation’s priorities.

On May 21, a day before the president signed the acquisition reform act, OFPP updated the maximum amount the government will reimburse companies’ overhead costs included in fiscal 2009 contracts to compensate an executive. In fiscal 2009, a company can charge the government up to $684,181 per contract in those costs to pay their top employees. That’s $72,000 more than in fiscal 2008.

Although it’s a standard annual update, one government contracting expert said companies need to be more aware of the dollar figure and similar requirements.

“I will say that this figure is taking on added importance with the Obama administration taking a hard look at what government contractor executives make,” said Larry Allen, president of the Coalition for Government Procurement.

“Coupled with the transparency mandate and the [stimulus]-related pay disclosures, I think a lot more companies need to be aware of what the government ‘limit’ is,” he said.

The American Recovery and Reinvestment Act, which Obama signed in February, also requires greater disclosure of how a contractor spends the stimulus money. It also forces contractors to offer access to the government overseers, such as inspectors general, while protecting whistle-blowers.

If a contractor doesn’t follow the rules, it will be exposed under the new regulations, said Ray Bjorklund, senior vice president and chief knowledge officer at FedSources, a market research firm.

“The contractor is taking the brunt” of the new rules, he said. “That’s just the way it is.”

Read the story: WashingtonTechnology.com - Contractors need to closely watch procurement changes

GSA nominee faces Senate panel and charms 'em

Senators say nominee Martha Johnson has plenty of private-sector and government experience

Martha Johnson, President Barack Obama’s nominee to be administrator of the General Services Administration, seems to be a shoo-in for the job.

Sen. Joe Lieberman (I-Conn.), chairman of the Homeland Security and Governmental Affairs Committee, said at Johnson’s confirmation hearing June 3 that he would work to quickly get her nomination approved by the committee and then the Senate.

He also said Obama made a wise choice in nominating her. “GSA, the president and the government need you to be at your desk,” he told Johnson.

Other senators mentioned Johnson’s qualifications and experience in the nonprofit and private sectors and the federal government, particularly as chief of staff at GSA in the 1990s when David Barram was administrator.

Johnson said she’s thrilled to go back to GSA. “‘Thrilled’ is actually a code word for me and for the agency,” she said.

Johnson said her highest priorities are to:

1. Demand, model and secure an uncompromising demonstration of ethical behavior and an organizational culture of values and trust.
2. Guarantee consistent, prompt and high-value performance for GSA’s customers.
3. Work to meet the demands of the economic stimulus law.
4. Support the Obama administration’s promise of a more transparent government.
   
5. Build and nurture strong leadership.

Lieberman and Sen. Susan Collins (R-Maine), the committee’s ranking member, told Johnson that agencies have turned from GSA to do their own procurements because they’re skeptical of GSA's services.

“Some agencies have lost confidence in the ability of GSA to provide the best products and at the best prices and have begun to negotiate their own contracts that duplicate services offered by GSA,” Lieberman said. “That defeats the purpose of GSA.”

The wave of interagency contracts is a market gesture against GSA’s performance, Johnson said. But another major underlying issue that has driven agencies to do their own procurements is the freedom to not use GSA. Legislative changes made the 1990s, including the Clinger-Cohen Act, lifted rules that made GSA the primary source for buying certain products and services. As a result, agencies decided to take the work into their own hands. They could more tightly control and tailor contracts to suit their needs, she said.

Although the competition among contracts often brings better value and lower prices, too much overlap can have the opposite effect, Johnson said, adding that she doesn’t believe GSA should be a monolithic source for purchasing.

Read the story: WashingtonTechnology.com - GSA nominee faces Senate panel and charms 'em

Acquisition work a tough sell

Bureaucracy, lack of prestige drive away potential workers

With the summer hiring season getting under way, the federal government would appear to be in a perfect position to expand the ranks of its acquisition workforce, if only it could stop driving away potential hires.

The good news is that the job market is swamped with college graduates looking for work — and some seasoned professionals who are re-entering the job market for financial reasons.

The federal government, which some workers might have avoided in years past, should be an attractive employer because it offers something many companies cannot: stability.

But then there is the bad news: The federal government is still a bureaucracy. New employees are likely to be frustrated by their lack of decision-making authority and little opportunity to try innovative ideas.

“The federal government is sitting in a pretty good place right now,” said Steve Kempf, assistant commissioner of acquisition management at the General Services Administration’s Federal Acquisition Service. “But I’m not sure we’re going to stay there.”

Several years ago, Congress gave agencies some help by granting them direct-hire authority for acquisition-related positions. That means managers can hire new employees themselves rather than going through the cumbersome process at the Office of Personnel Management.

Congress has also allocated money for agencies to set up booths at job fairs, making it possible to reach potential hires who might not have considered government work.

Once the new employees have been hired, officials often take them on field trips. A visit to a Coast Guard cutter or air traffic control tower shows the new recruits how their work helps the government and country. Many experts say people take more pride in their jobs when they know what their participation brings the government.

However, the thrill of such visits fades fast, leaving new employees wondering what the future holds for them. “You have to have a path to success, and right now the government doesn’t provide that,” said Max Stier, president and chief executive officer of the Partnership for Public Service. There are a number of barriers to success, he added.

The acquisition field has some unique obstacles, experts say. At most agencies, contracting officers are considered less important than they once were, giving the job less prestige and visibility despite its importance to agencies’ success, said Kempf, a career acquisition employee.

“I think we’ve lowered them in the food chain,” he said. When Kempf entered the field two decades ago, contracting officers were revered and had their own offices. Today, they’ve been downgraded to cubicles, he said.

That demotion leaves the contracting officer as simply another step in the purchasing process. But procurement skills should be a core competency because they involve negotiating prices, researching the marketplace, reviewing proposals and awarding contracts on a basis that will withstand protests, said Alan Chvotkin, executive vice president and counsel at the Professional Services Council.

However, once they’ve chosen the acquisition field, employees have no incentive to pursue a career in government procurement, experts say.

“Frankly, they have every reason to fear for their careers,” said Steven Schooner, an associate law professor and co-director of the Government Procurement Law Program at George Washington University.

Congress, watchdog groups and the news media criticize the acquisition community and pounce on mistakes regardless of whether they are fraud or honest errors.

“Competing with the environment we have now, we will find every way to push them out the door,” Kempf said. Bosses will criticize acquisition employees for every mistake they make, even when they’re still learning, he said. The employees who were wowed at the job fair by the stories of being the United States’ buyer will find they don’t have the job that had piqued their interest. Agency managers won’t trust them to judge situations and will instead give them less challenging work, he added.

Younger workers recognize that situation and are not attracted to acquisition.

“The jobs just don’t smell good,” Schooner said.

Meanwhile, young employees can easily be attracted by the private sector’s portrayal of opportunities for leadership, excitement and playing a part in something that’s going to change the world. Companies can woo them with more money and benefits, too.

Beyond the younger generation, the government retirement system creates incentives for experienced career employees to leave for the private sector, taking their knowledge with them, said Rep. Darrell Issa (R-Calif.), a member of the congressional Smart Contracting Caucus and ranking member of the House Oversight and Government Reform Committee.

As the government faces that workforce shortage, its spending has increased dramatically in recent years — nearly doubling since 2000 — and the size of the workforce has increased only minimally. As a result, contracting officers’ jobs now require getting as much done as possible in a short time, despite the fear of a news-making mistake, experts say.

“Their incentive is volume,” said John Needham, director of acquisition and sourcing management at the Government Accountability Office.

Read the story: FCW.com News - Acquisition work a tough sell

GSA to make new bid for agency customers

GSA to offer contracts in the areas of cloud computing, transparency

The General Services Administration is gearing up to offer help to federal agencies looking to participate in the Obama administration’s initiatives on transparency and cloud computing, a GSA official said today.

GSA hopes to win customers that otherwise might have developed their own contracts or services.

“We see the administration’s requirements, we respond by initiating some kind of contract action, and make it fast and easy for government agencies to use,” said Ed O’Hare, the new assistant commissioner for Integrated Technology Services (ITS) at GSA's Federal Acquisition Service. He spoke at a FedSources breakfast meeting.

Obama administration officials have created numerous Web sites, such as Recovery.gov and Data.gov, to offer more information to the public. The new chief information officer, Vivek Kundra, is also moving ahead on the use of cloud computing.

O’Hare described cloud computing as a data center wrapped up with software as a solution. He wants to make it possible for agencies to buy such services using government credit cards, especially when they’re under deadline.

“You don’t have to go to the CIO, you don’t have to go plan it, you don’t have to go buy servers or digital maps or do” certification and accreditation, O’Hare said. Instead, he would like agencies to be able to log onto a Web site, answer a few questions about their needs and then, “Boom, check out, you got it.”

With O’Hare as the chief of ITS, experts now expect greater attention to day-to-day operations. They say he has been on the industry side of GSA and worked inside the agency, and therefore understands how ITS runs.

When John Johnson retired earlier this month as assistant commissioner for ITS, major contracts had been awarded and customers were placing orders. That leaves O’Hare to deal with how the office runs.

“My job is to make it work,” O'Hare said. He wants to make ITS and GSA’s information technology services faster, better and cheaper than what other agencies can offer.

He also talked about reducing the time it takes to get an IT contract on GSA’s Multiple Award Schedules program. Contractors are frustrated because it can take months to get on the IT Schedule 70 or modify one of those contracts.

“I know we’ve got to do better,” O’Hare said.

Read the story: FCW.com News - GSA to make new bid for agency customers

Obama signs law to reform weapons buying

The law puts checks on big-ticket weapons acquisitions to keep them on schedule and hold down costs.

President Barack Obama signed legislation yesterday to change how the Defense Department buys and tracks acquisitions of major weapons systems.

“When it comes to purchasing weapons systems and developing defense projects, the choice we face is between investments that are designed to keep the American people safe and those that are simply designed to make a defense company or a contractor rich,” Obama said before signing the bill.

The Weapons Systems Acquisition Reform Act (S. 454) requires DOD to appoint senior officials to assess a project’s performance and analyze underlying causes for any of its shortcomings, such as unrealistic expectations, too little funding, or poor work by a contractor or DOD.

It requires officials to encourage competition, including 10 competition-promoting measures to consider when setting acquisition strategies. It also deals with organizational conflicts of interest, requires a study of earned value management, and sets checkpoints at certain milestones in projects.

The law's purpose is to limit cost overruns before they spiral out of control, Obama said. "Wasteful spending comes from exotic requirements, lack of oversight and indefensible no-bid contracts."

Obama also said this is the first step in fixing how the government buys things. “It reforms a system where taxpayers are charged too much for weapons systems that too often arrive late,” he said. Obama signed a memo March 4 designed to improve the procurement system.

However, acquisition experts say the vast majority of purchases are received as agencies requested.

“By and large the government gets what it wants, when it wants it, for the price it’s wiling to pay,” said Alan Chvotkin, executive vice president and counsel at the Professional Services Council, who spoke this week at a panel discussion about the federal acquisition workforce. However, he said the procurement system still has room for improvements.

At the same discussion, Steven Schooner, an associate law professor and co-director of the Government Procurement Law Program at George Washington University, pointed out the Obama administration views contractors as lining their pockets at the taxpayers’ expense. Schooner said the president, Congress and the news media can’t treat contractors as pariahs because the government can’t operate without contractors’ support.

Read the story: FCW.com News - Obama signs law to reform weapons buying

Experts: Acquisition jobs offer few incentives

Federal contracting careers losing appeal

Federal acquisition employees have no good reason to continue their careers in government procurement, a panel of experts said May 19.

Contracting specialists have been relegated to ordinary positions at agencies after once being held in high esteem, said Steve Kempf, assistant commissioner of acquisition management at the General Services Administration’s Federal Acquisition Service.

“I think we’ve lowered them in the food chain,” said Kempf, a career acquisition employee. When Kempf entered the field two decades ago, contracting officers were revered and had their own offices. He said today though they’ve been downgraded to cubicles.

His point was an underlying theme of a discussion among eight government acquisition experts hosted by the congressional Smart Contracting Caucus. They said the acquisition community is being criticized by Congress and the news media, which pounce on mistakes regardless of whether they are fraud or honest errors.

“Contracting officers get beat down a lot,” Kempf said, adding that one mistake could end a career.

“Frankly, they have every reason to fear for their careers,” said Steve Schooner, an associate law professor and co-director of the Government Procurement Law Program at George Washington University.

Scott Amey, general counsel at the Project on Government Oversight, said oversight and accountability aren’t punishment. However, overseers inside and outside government need to determine when an error is fraud or an honest mistake.

Despite the fear of making a career-ending error, contracting officers today focus on accomplishing as much as possible in a short time, the experts said.

“Their incentive is volume,” said John Needham, director of acquisition and sourcing management at the Government Accountability Office.

Government spending has increased dramatically in recent years — nearly doubling since 2000 — and the size of the overall workforce has increased only minimally. The workload pressures are stressful for acquisition employees. They hope they don’t make a major mistake, but they don’t have time to check all the details of each acquisition, experts said.

There are few other incentives for acquisition employees to stay with the government. The private sector can offer them more money and benefits. Furthermore, the government retirement system creates incentives for employees to leave for the private sector, said Rep. Darrell Issa (R-Calif.), a caucus member and ranking member of the House Oversight and Government Reform Committee. Experts also said it takes months to get a job with the government because of its broken hiring system.

Overall, the field has lost its luster because it’s now an administrative job, the panelists said.

Members of the younger generation recognize that and are not attracted to the acquisition field. Schooner said the descriptions of government openings on USAJobs.gov are generic and boring. “The jobs just don’t smell good,” he said.

Read the story: FCW.com News - Experts: Acquisition jobs offer few incentives

Supplemental bills would restrict award fees

Congress is working to restrict award fees for contractors’ work.

The House passed its fiscal 2009 Supplemental Appropriations Act (H.R. 2346) on May 14 with a provision that would not allow the Defense Department to spend its money on award fees to defense contractors unless DOD judged their work using set criteria.

The bill would boost the importance of the guidance on award fees in the fiscal 2007 National Defense Authorization Act. That law required the defense secretary to write rules on how DOD should appropriately link award fees to acquisition outcomes. The law bolstered checks on what is good contractor performance worthy of the extra money.

In particular, the authorization law required, among other things, guidance on how to judge performance, determine if a contractor should get even a percentage of the award for satisfactory work, and analyze whether award fees actually work to improve contractors' work.

Also on May 14, the Senate Appropriations Committee also approved its version of the supplemental bill (S. 1054) that has a similar provision that would restrict award fees.

The provisions align with a March 4, 2009, memo from President Barack Obama designed to stop the use of cost-reimbursement contracts, including ones that would pay for contractors’ cost plus an award fee for reaching certain performance measures.

“We will end unnecessary no-bid contracts and cost-plus contracts that run up the bill that is paid by the American people,” Obama said at a press conference in March. Obama predicted his reforms would save the government $40 billion each year.

Read the story: FCW.com News - Supplemental bills would restrict award fees

Acquisition Workforce: Clerk vs. Businessman

Government officials have been concerned for several years about the coming wave of retirements by federal employees, especially in the field of acquisition. But the Obama administration sees a real upside.

In its fiscal 2010 budget proposal’s Analytical Perspectives, the administration writes:

The retirement wave also presents an opportunity to reform and re-energize the federal workforce by re-evaluating what the workforce does and how it does it. It will provide an opportunity to transform the government’s workforce capacity to address 21st-century challenges by implementing 21st-century systems and processes to acquire, develop, engage, compensate, recognize and effectively retain talented employees.

At a procurement conference on Thursday, a former Army contracting officer said the retirement wave will allow the acquisition workforce to become a new breed of thinkers and strategists. And the days of procurement clerks who have for decades pushed their papers and rarely taken time to consider business strategies will fade away, he said. Meanwhile, he said the incoming workforce will arrive with a business-savvy outlook, instead of the bureaucratic rubber-stamping of program managers’ demands.

He said the retirees’ replacements will come with a 21st-century mindset and want to be more involved throughout the process. They will want to find the best solutions for a contract — sort of like bargain hunters. The incoming generation of new workers wants to make a difference in their field, and that will make a huge difference in contracting. The incoming generation won’t clock out of work as soon as their shift is over as “the clerk generation” does, he said but they will stick around until the work is done.

That workforce will also learn that the actual procurement is only one small piece of a broader process known as acquisition. It’s a change in thinking that acquisition leaders are trying to incorporate today. Purchasing along with planning out strategies before and managing contracts after they’re awarded entail acquisition. Contracting officers, contracting officer’s technical representatives and even program managers are parts of the acquisition.

However the former contracting officer said, the mentality of the 21st-century workforce may not take hold until the retirement wave hits.

Will the retirement wave have such an effect?

IG finds conflict in the acquisition regulation

The Federal Acquisition Regulation may have conflicting language, Defense Department auditors said in a report.

The FAR requires that small businesses get an advantage over other companies if a contracting officer can find two responsible small companies that can offer reasonable bids. That is known as the Rule of Two, and last year the Government Accountability Office ruled that it applies to task and delivery orders.

Meanwhile, another section of the FAR states: “The contracting officer must provide each awardee a fair opportunity to be considered for each order exceeding $3,000 issued under multiple delivery-order contracts or multiple task-order contracts.”

In a report released May 6, DOD's inspector general’s office found the conflict as it audited the Navy’s SeaPort Enhanced (SeaPort-e) indefinite-delivery/indefinite-quantity contracts.

The IG’s auditors said the SeaPort-e program manager failed to adequately compete 39 of 133 audited task orders when the manager allowed small business set-asides. The 39 orders were worth $469.3 million. The program manager deviated from the FAR by not ensuring contracting officers performed adequate market research on the small business set-aside task order contracts. As a result, Navy officials may not always receive the best value for the SeaPort-e customer, the IG said.

However, the manager argued that the Small Business Administration supported the set-asides and large contractors signed agreements that included language on the set-asides. Nevertheless, the IG wrote, “Neither the SeaPort-e program manager nor the Small Business Administration has the authority to override” the fair opportunity provision of the FAR or the statute on which it's based.

The Defense Acquisition Regulations Council and the Federal Acquisition Regulations Council should determine if the FAR needs more specificity on what’s allowed when setting aside a task order for small businesses, the IG wrote. Navy Department officials intend to bring up the conflict to regulators for a clarification, the report states.

In the IG’s discussions with GAO's General Counsel Office, GAO said its October 2008 decision on the Rule of Two has caused confusion on the topic of small-business set-asides and full competition. GAO officials said legislative action will likely be necessary to clarify the intent of the Rule of Two, according to the IG’s report.

The Rule of Two is in FAR Part 19. The fair opportunity provision is in FAR Part 16.

Read the story: FCW.com News - IG finds conflict in the acquisition regulation

The hidden force in acquisition

Some of the most influential people in the federal acquisition community are also the least well known.

They make critical decisions at every step of the acquisition process, yet the Federal Acquisition Regulation does not mention them. Any reform initiative that does not take them into account is bound to fail, yet the Office of Federal Procurement Policy rarely takes note of them in memos.

But that is beginning to change. Slowly but surely, federal agencies are coming to realize that contracting officer’s technical representatives (COTRs) play an essential — if underappreciated — role in government contracting.

Even the Government Accountability Office is trying to get a handle on the community.

“We have no really clear picture of how many of those there are, what their training and skills are, and so forth,” said John Needham, director of acquisition and sourcing management at GAO, during an April 28 congressional hearing on the Defense Department’s acquisition workforce. “That’s one area we saw as a need.”

COTRs serve as a vital link between their better-known colleagues — program managers and contracting officers — and help translate operational requirements into executable and manageable contracts.

“They’re the principal people who bring these worlds together,” said Robert Burton, former deputy administrator at OFPP and now a partner at Venable law firm.

COTRs also keep tabs on how well contractors are meeting their requirements. Agencies have learned the hard way that they cannot hand that task to new employees or pile it on an already overworked acquisition staff.

So as contracting spending rises and the complexity of contracts increases, COTRs have become the linchpin of government contracting.

Performance pressure points

Agencies are finally beginning to appreciate COTRs because agencies are spending much more money on services compared to a decade ago. For example, DOD spent $202 billion through services contracts in 2008, compared to $92 billion 2001.

“There are a lot more moving parts to keep hold of and a lot more contracts to manage today,” said Mary Davie, assistant commissioner of the Office of Assisted Acquisition Services at the General Services Administration’s Federal Acquisition Service.

Davie took a job as a COTR in 1989, when she was 23 years old. It was a good way to get some on-the-job training, she said. She made sure that products came in on time and in good condition. “They were sort of turning to me for getting what was needed and keeping the project on schedule,” she said.

In recent years, agencies have been under pressure from the White House and Congress to determine whether they are getting their tax dollars’ worth from contracts, said Elizabeth Miller, vice president of Government Horizons, a nonprofit acquisition training organization.

Therefore, they are trying to develop more sophisticated ways to measure contractor performance. Those metrics and disciplines such as earned value management can get complicated when it comes to technical services contracts.

COTRs are responsible for building such metrics into contracts and sounding the alarm when contractors go astray. Communication must happen early and often, Miller said. “It’s not about waiting for the monthly progress report to find out, ‘Oh, we have a problem.’”

Davie said COTRs also explain to contractors what the program managers need and what the contracting language requires of them.

In addition, COTRs must keep in close touch with contracting officers about progress and suggest modifications if things are off kilter, experts say.

“The COTRs go back and forth,” Burton said.

COTRs come of age

With President Barack Obama’s push to put more contracting information online for public consumption, several experts said COTRs’ duties will become more visible, which will force them to manage projects even more carefully.

With billions of stimulus dollars to spend, the increased burden on COTRs worries many inspectors general. They know agencies will have their hands full managing that money, which comes with new demands from the administration to track where the money is going and what it yields.

Numerous IGs have issued reports recently detailing their concerns about their acquisition workforces. The American Recovery and Reinvestment Act’s requirements seem to demand larger acquisition workforces than agencies have. Existing employees are already struggling to manage increasing sums of money and transactions, even without the stimulus funds.

Procurement officials expect that actions associated with the stimulus funding will be complex, requiring more rigor and oversight. That will, in turn, increase the demands on COTRs and other contract specialists, according to a recent report from the Energy Department’s IG.

In today’s environment, COTRs can’t be young people fresh out of college, as they often were in the past, officials say. They must be savvy and experienced experts in their fields who understand both the procurement and program management sides of acquisition.

In recent years, “there was a shifting expectation for a higher level of competence in understanding and collaborating on the ‘how’ versus the ‘what,’” said Chuck Harris, a former Air Force contracting officer and now president and chief executive officer of Inflection Point Solutions, a training and consulting company.

It hasn’t always been that way. DOD, the world’s biggest buyer, has not always filled the slots for contracting officer’s representatives -- DOD's equivalent to the COTR -- with the best people. It is not uncommon for CORs overseas in war zones to have no training. And generally, all COR training is geared for times when operations are slow, so it is barely adequate when situations get tense, the Senate Armed Services Committee wrote in a report last year.

Assigning a soldier to the role of a COR would seem like a good way to boost someone’s career by providing a launching point into the contracting field. But too often, the soldier who takes on that role doesn’t have any relevant experience, the committee wrote. Then the situation gets worse.

“The COR assignment is often used to send a young soldier to the other side of the base when a commander does not want to have to deal with the person,” the committee wrote.

The Army wants to correct the situation. Officials are spreading the word about CORs’ role in contracting and are teaching Army commanders, staff members and people outside contracting the value of CORs.

“The COR’s role is key to ensuring that the government is getting what it is paying for with appropriate oversight,” Edward Harrington, deputy assistant secretary of the Army for procurement, told a House subcommittee in March.

In April, Jeffery Parsons, executive director of the year-old Army Contracting Command, said an entire division is dedicated to fixing its COR program. And the Army published the “Deployed COR Handbook” to supplement CORs’ training when they’re out in the field.

Sizing up the COTRs

But even as COTRs grow in importance and receive more recognition, officials are still struggling to form a clear picture of the community.

One official called it a mysterious group because agencies and analysts know so little about them. They’re often hidden behind full-time jobs in areas such as information technology or engineering.

In its 2008 report on the acquisition workforce, the Federal Acquisition Institute said it couldn’t identify COTRs because agencies’ records and official guidance about them are so ambiguous. It deferred analysis of COTR demographics until the role is better defined and agencies keep better records.

Officials recognize that the COTR’s role is also growing in importance because the future of government contracting will likely mirror the recovery act rules.

“The program managers rely on them, and the contracting officers rely on them,” Burton said. “They’re really the bridge.”

Read the story: FCW.com News - The hidden force in acquisition