Officials: Recovery act rules are the future

The strict acquisition regulations attached the stimulus money is a foretaste of what agencies and contractors can expect for the future, several government officials said in speeches April 23.

The American Recovery and Reinvestment Act, has many transparency requirements, a strong emphasis on firm-fixed-price contracts and competition for those contracts, and demands for tracking the money to show what it yields. Procurement officials say these levels of transparency and oversight have never been demanded in such ways, and it’s only the beginning of what’s to come. A precedent has now been set, many experts have said.

“The stimulus is the wave of the future,” Soraya Correa, director of procurement operations at the Homeland Security Department, said at an event hosted by the American Small Business Coalition.

General Services Administration officials who also spoke said the law's requirements force agencies to keep a closer tabs on what they spend and how they spend it because the information will be public on Recovery.gov and agencies' own recovery Web sites.

“With revenue comes responsibility,” said Amanda Fredriksen, GSA’s deputy assistant commissioner for general supplies and services.

To boost transparency, the law requires agencies to publicize their bid proposals. Even if an agency buys a product or service from a GSA Schedule contract, the agency has to post a notice on the Federal Business Opportunities Web site for the sake of announcing it, which wasn’t required in the past.

The requirements will also reach into contractors’ books, officials said. Agencies will ask contractors for their spending and subcontracting information. And to remain in GSA’s Schedules program, companies must agree to adhere to the new requirements. GSA officials said companies can expect to hear from the agency soon.

“That means your data is out there,” Correa said to a group of small-business owners, adding that they need to make sure their books are in order and presentable because the information could be posted on the Internet.

David Drabkin, GSA’s acting chief acquisition officer, said the transparency theme has been moving ahead for at least two years. In December 2007, the Office of Management and Budget launched USASpending.gov as part of a law that then-Sen. Barack Obama helped introduce legislation known as the Federal Funding Accountability and Transparency Act. While in Congress, he introduced a follow-up, which would have provided more information on the government’s contracting system, but it never became law.

In his same spirit of openness, the stimulus law, which pushes for contracts with nonadjustable prices, requires agencies to share their reasons for why a contract couldn’t be awarded with a set price. In the past, those justifications have stayed within the agency.

“People are going to be able to read the excuse you’re giving, and people are going to hold your feet to the fire,” Correa said. That likely will lead to more discussions between agencies and industry through more draft requests for proposals, in-depth market research and outreach to a broader range of companies, she said.

Drabkin said the stimulus spending reflects President Obama’s March 4 memo on his proposals for procurement reforms, such as greater competition for work, a preference for firm-fixed-price contracts, more transparency from agencies, and a stronger workforce to handle the immense amount of contracting work flooding into agencies.

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Bid protests keep pace with DOD spending

The number of protests against the Defense Department's contract awards has grown at the same rate as the department’s spending has increased over the past several years, according to a recent report.

The Government Accountability Office has handled as few as 458 bid protests filed by companies against DOD’s contract awards in fiscal 2004 and as many as 540 protests in 2007, GAO reported April 14. In 2008, the protests increased to 611, a 23.9 percent jump compared with 2007, the largest margin in past four years, GAO said, adding that the greatest increase had been 17.9 percent in 2005.

GAO also said 2008’s increase comes from its expanded protest jurisdiction. The fiscal 2008 National Defense Authorization Act granted federal employees involved in a public-private competition for government work to protest a decision to outsource the work to the contractor.

Excluding protests in the expanded jurisdiction, GAO said the protest number rose to 581, or 17.8 percent, over 2007.

GAO put the increase in context of DOD’s spending. Despite the 17.8 percent jump, DOD spent 15.7 percent more money in 2008, compared with the previous year’s spending. “These similar rates of increase may suggest that the increase in protests was due in part to DOD’s increase in procurement spending,” GAO said.

GAO also said during the last two decades, the number of bid protests against both DOD's and civilian agencies' award decisions has declined. In 1989, companies filed 1,490 protests against DOD's award and 750 against civilian agencies’ decisions. In 2008, there were 611 protests against DOD's decisions and 416 against civilian agencies' decisions. The total number of protests against defense and civilian awards peaked in 1993 with 2,336 and has continued downward since, according to GAO’s figures.

Congress required GAO in the fiscal 2009 National Defense Authorization Act to assess bid protest trends; some members of Congress are concerned about frivolous protests. The House Armed Services Committee wrote that bidders seem to automatically file a bid protest if they lose a competition for a contract.

When a company files a protest, the matter goes before GAO. A group of 30 attorneys in GAO’s Office of General Counsel, who serve as hearing officers, address a company’s allegations that an agency acted contrary to procurement law or its contract solicitation.

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Martha Johnson may bring old era back to GSA

Martha Johnson, the nominee for the top job at the General Services Administration, could bring back an old era of good times at GSA that many inside and outside the agency are already bubbling about, several experts said today.

Johnson, who was chief of staff for then-GSA administrator David Barram from 1997 to 2001, is someone agency employees consider to be one of their own, those experts said.

“She knows GSA inside and out, and she knows almost all of the people there,” said Dennis Fischer, who was GSA’s Federal Technology Service (FTS) commissioner 1997 to 2001.

He has received e-mail messages from numerous agency employees who are excited by the news that President Barack Obama picked Johnson as his nominee to lead GSA, said Fischer, who’s now a consultant.

“I think the place is probably electric,” he said.

The White House made its announcement about Johnson's nomination late April 3, and the e-mail messages quickly began arriving in Fischer’s inbox, he said. Bob Woods, former FTS commissioner at GSA from 1994 to 1997 and now president of Topside Consulting, said a large number of retired GSA officials expressed interest in returning to the agency because Johnson could be back. “That says a lot,” he said.

Unlike recent administrators, Johnson has experience inside GSA, which would give her an advantage in improving an agency that has suffered through contracting crises, lost business as customer agencies do their own contracting work, and leaders who lacked a deep understanding of the agency.

“GSA can’t be another place for someone to learn,” Woods said. Johnson's "disposition is great, but it’s her experience that is what’s needed.”

Johnson served as co-lead for the Obama Presidential Transition Agency Review Team for GSA. That work gave her a close look into what had been happening at the agency during the previous administration, several experts said, adding that the information would serve her well.

Johnson has been vice president of culture at Computer Sciences Corp. since 2007. As vice president, she helps direct the change in culture of the 90,000-person corporation.

GSA's Public Building Service (PBS) is likely to grab Johnson's attention as stimulus money pours into making federal buildings more energy efficient, said Larry Allen, president of the Coalition for Government Procurement.

“The congressional and public interest is high in how Public Building Service funds are dispersed,” he said.

Fischer and Woods said GSA's Federal Acquisition Service won't be forgotten. They said PBS has longtime officials who know how the organization operates, which will free Johnson to boost FAS’ reputation. Woods said that when GSA formed FAS by merging the Federal Supply Service and FTS, it lost two brand names that were central purchasing organizations. GSA must continue to rebuild its name, he said.

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