3 myths that cripple acquisition: #1 – Government can be perfect

Government is held to a standard no industry, company or CEO must meet.

Congress, the media and most Americans seem to unquestioningly accept the myth that when our government plans and budgets for projects – no matter how large, daunting or new – they should achieve them exactly as planned, with no errors and no adjustments, 100 percent of the time.

When companies, universities, philanthropies and citizens regroup and adjust or begin again, we accept their efforts as earnest and the adjustments as a normal part of life. But when government stumbles or determines it needs to adjust or takes a new path, we assume it’s due to waste, fraud, abuse or incompetence.

In fact, what government takes on is just really hard—Moon and Mars shots, fighting terrorists, eradicating poverty, responding to disasters, providing access to health care for all Americans.

Unlike our favorite companies, such as Apple, Google, Facebook, LinkedIn, Craigslist and many others, government is given no opportunity to change course, learn and adapt. It is captive in a zero-defect, reality-free zone of its own citizens’ making.

This column is the first in a series about three myths that hamper government’s ability to modernize its acquisition process.  Keep reading this article at: http://www.govexec.com/contracting/2014/04/3-myths-cripple-acquisition/82792/ 

Why past performance must be part of acquisition reform

Although the failed rollout of HealthCare.gov brought attention to how the federal government purchases technology, little consideration has been given to how contractors with poor track records of performance continue to get federal contracts.

Sen. Claire McCaskill (D-Mo.), chairwoman of the Homeland Security and Governmental Affairs Committee’s Financial and Contracting Oversight Subcommittee, raised this issue at a recent hearing by saying that the Centers for Medicare and Medicaid Services “could have avoided a black eye” for the failed rollout of the HealthCare.gov website if the agency had had relevant data on the past performance of CGI Federal.

That raises the question of what is being done to improve data on contractors’ past performance. And perhaps more important, why is past-performance data not being captured properly in the first place?

Last year, the government issued a new rule in an attempt to create governmentwide, standardized contract performance rating and evaluation factors for federal contractors. However, without the metrics and objective performance parameters needed to create uniformity and consistency in the evaluations of a contractor’s past performance, the rule simply continued the current system of subjective ratings by evaluators.

Keep reading this article at: http://fcw.com/articles/2014/04/11/comment-gracia-past-performance-data.aspx 

DoD plots third chapter in Better Buying Power initiative

Nothing is on paper yet, but the Defense Department says it is in the very early stages of creating a “3.0″ version of its ongoing Better Buying Power initiative.

The newest edition will focus on making sure the military doesn’t fall behind in technological superiority.

Frank Kendall, the undersecretary of Defense for acquisition, technology and logistics, said the next edition of the Pentagon’s effort to improve its acquisition system will zero in on an issue that he has become increasingly worried about as sequestration-level budgets take a toll on DoD’s investments in research and development.

While he emphasized that Better Buying Power 3.0 still is in the idea stage, he said it will revolve around the notion that DoD can’t afford to put technology advances on hold just because research dollars are shrinking.

“The first iteration was about the rules. The second one was about creating tools to help people think and do a better job of setting up business deals and executing them. The third is probably going to be about innovation and how we move things more rapidly and more effectively into the hands of warfighters,” he said Tuesday (Apr. 8, 2014) at the 15th annual Science and Engineering Technology Conference sponsored by the National Defense Industrial Association in College Park, Md.

Keep reading this article at: http://www.federalnewsradio.com/65/3599360/DoD-plots-third-chapter-in-Better-Buying-Power-initiative- 

GSA announces plan to simplify federal contracting

The General Services Administration’s contracting division is developing a new Web platform and business structure to bring more expertise to complicated acquisitions, the agency said April 9, 2014.

The new initiative, called Category Management, will involve assigning a Federal Acquisition Service manager in charge of each of several acquisition categories, such as information technology, professional services and travel.

Those managers will help develop a Common Acquisition Platform with information about contract vehicles, historical prices and other data related to specific procurements, FAS Commissioner Thomas Sharpe said in a 1,000-word blog post.

The acquisition platform will eventually include several tools related to specific categories of government purchases, according to the blog post.

Keep reading this article at: http://www.nextgov.com/cio-briefing/2014/04/gsa-announces-plan-simplify-federal-contracting/82306/?oref=nextgov_cio_briefing 

‘Reverse Auctions’ draw scrutiny

It is like an eBay of Washington, a well-appointed and well-connected online marketplace for lucrative government contracts.

Deals for everything from pens to pesticides, from painting offices to performing autopsies — all that and more is up for grabs on FedBid, a fast-growing private company that has positioned itself at the profitable nexus of government and business.

Financed by an investment company connected to Stephen M. Case, of AOL fame, and Ted Leonsis, majority owner of the Washington Wizards, FedBid has assembled a roster of Beltway insiders to promote an unusual approach to how contracts are meted out. Its latest big hire is Joseph Jordan, who was until recently head of procurement policy for the Obama administration.

Through FedBid, government agencies use “reverse auctions” — in which the lowest bid wins, rather than the highest — to decide who is awarded contracts. In theory, the process can save money for taxpayers by encouraging businesses to offer the best possible prices. In practice, it also makes a lot of money for FedBid, which can collect fees from the winning bidders who, in turn, pass those costs to the government.

At issue is whether FedBid encourages competition, as its proponents argue, or simply prompts companies to submit unrealistically low bids to outmaneuver business rivals. Detractors contend that awarding contracts based solely on price means that the government risks ending up with inferior products or services, though this is a risk even when the government does not use reverse auctions. A recent government study, which reviewed reverse auctions at top agencies, found that roughly a third of all FedBid auctions involved a single bidder, meaning that they were closer to no-bid contracts than true auctions.

Keep reading this article at: http://www.nytimes.com/2014/04/07/business/reverse-auctions-draw-scrutiny.html?nl=todaysheadlines&emc=edit_th_20140407&_r=1 

GAO issues annual anti-deficiency report

Each year, the Government Accountability Office (GAO) produces a report that identifies instances where federal agencies obligated or spent funds in advance or in excess of appropriate approval of funding.  This reporting is conducted in accordance with the Antideficiency Act which prohibits such expenditures.

GAO’s summary of agency Antideficiency Act Reports for fiscal year 2013 includes unaudited information extracted from agency Antideficiency Act reports filed with GAO, as required by section 1401 of the Consolidated Appropriations Act, 2005, Pub. L. No. 108-447, 118 Stat. 2809, 3192 (Dec. 8, 2004).  Each report entry includes a brief description of the violation, remedial actions taken, and links to individual agency reporting letters. For more information on individual violations and actions taken, contact the agencies filing the reports.

The latest report can be found here.

Per 31 U.S.C. §§ 1341, 1517(a), the Antideficiency Act prohibits federal agencies from obligating or expending federal funds in advance or in excess of an appropriation, apportionment, or certain administrative subdivisions of those funds.  The act also prohibits agencies from accepting voluntary services (31 U.S.C. §§ 1342).

Specifically, the Antideficiency Act requires agencies violating its proscriptions to:

  • Report to the President and Congress all relevant facts and a statement of actions taken, and
  • Transmit a copy of each report to the Comptroller General on the same date the report is transmitted to the President and Congress.

GAO compiles and presents unaudited information from reports filed each fiscal year, including copies of the agency’s cover letters transmitting reports of violations.

GAO: USDA improperly awarded $141 million sole source contract

The U.S. Department of Agriculture improperly awarded a $141 million sole source contract in exchange for the contractor’s agreement to withdraw a GAO bid protest.

According to a recent GAO bid protest decision, the award violated the Competition in Contracting Act, which does not permit an agency to award a sole source contract in exchange for a contractor’s promise to terminate litigation against the agency.

The GAO’s decision in Coulson Aviation (USA), Inc., et al., B-409356.2 et al.(Mar. 31, 2014) involved the USDA’s procurement of next generation (“NextGen”) large airtanker services for wildland firefighting support.  The Air Force initially issued a solicitation for the NextGen airtanker services in 2011.  After corrective action taken in response to a GAO bid protest, the USDA awarded NextGen contracts to four companies.  Neptune Aviation Services, Inc., which had initially been identified as an awardee before the protest, was not awarded a NextGen contract.

Keep reading this article at: http://smallgovcon.com/gaobidprotests/gao-usda-improperly-awarded-141-million-sole-source-contract/ 

Information technology price transparency could come at cost

TotaKeep reading  governmentwide transparency on pricing for information technology products could have unintended consequences, said a senior acquisition official.

Today, federal agencies have access to the catalog-list prices companies charge through governmentwide acquisition vehicles (GWAC). Although those catalog prices are negotiated with price fairness in mind – to ensure the amounts are comparable to commercial prices – agencies often pay less than list when executing orders of any significance.

That disconnect between the catalog price being the de facto maximum price, rather than the actual price, has led to efforts to record actual prices and share that information between federal agencies.

Rob Coen, acting director of the National Institutes of Health Technology Acquisition and Assessment Center, told an audience of federal officials and private sector sellers that his agency is setting up a dashboard that will permit customers to “see what other agencies are buying, who’s buying what, who they are buying it from and what they are paying.” NIH runs three governmentwide acquisition contracts, contract vehicles dedicated to IT products or services and meant for inter-departmental use.

The General Services Administration is also developing a “Price Paid Tool,” an online portal currently in proof of concept stage.

Keep reading this article at: http://www.fiercegovernment.com/story/information-technology-price-transparency-could-come-cost/2014-03-25

Privately-financed development project not subject to Davis-Bacon Act, rules U.S. District Court

The Labor Department was wrong to declare a privately financed development project  a “public work” that would be subject to higher wages under the Davis-Bacon Act, a federal court ruled Monday in a lawsuit brought against the labor agency by the District of Columbia.

In the ruling, the U.S. District Court for the District of Columbia said the “CityCenterDC” development won’t be built or used by the government or the public. While the mixed-use project of condominiums, apartments, offices, hotel, retail stores and some public open spaces will sit on a parcel of land owned by the District of Columbia, it will be entirely privately funded, occupied, and maintained for the duration of the developers’ 99-year leases with the city, Judge Amy Berman Jackson said in her decision.

That contradicts the decision that was made by the Labor Department’s Administrative Review Board, which had determined the project was a “public work” for purposes of the Davis-Bacon Act. That law — enacted during the Great Depression to stop contractors from driving down wages with cheap labor — requires the payment of local prevailing wages to workers on federal construction projects. The Labor Department determines the wages.

Legal experts who’d watched the case had said the Labor Department’s decision could have a significant effect on construction projects if it were to stand.

Keep reading this article at: http://blogs.wsj.com/washwire/2014/04/01/court-rules-against-labor-department-in-citycenterdc-case

Differing DoD and SBA rules on protecting SBIR technical data causing confusion

The intellectual property rights of small business are subject to risk from differing Defense Department and Small Business Administration rules governing Small Business Innovation Research contracts, say DoD auditors.

Policies governing how long the technical data developed by small businesses under the SBIR program differ between the Small Business Administration SBIR Policy Directive and the Defense Federal Acquisition Regulation Supplement.

Federal agencies that spend more than $100 million annually on external research must allocate during the current fiscal year at least 2.8 percent of that budget to SBIR contracts.

The SBA directive governing SBIR says the technical data protection period starts when the last deliverable under the contract is delivered by a small business awardee. That period can be extended if the SBIR data is protected and referenced under a subsequent SBIR contract, even if the rights expired.

The DFARS rule says project completion determines the protection period. DFARS doesn’t whether the protection period can be extended or renewed.

Keep reading this article at: http://www.fiercegovernment.com/story/differing-dod-and-sba-rules-protecting-sbir-technical-data-causing-confusio/2014-03-31

The DoD Inspector General’s report can be downloaded at: http://www.dodig.mil/pubs/documents/DODIG-2014-049.pdf