GSA owes more than $3 million to small businesses

May 22, 2013 by

The General Services Administration has failed to fully pay 1,334 federal contractors, shorting them by more than $3 million since 2008, according to a House committee report released Thursday.

The amount may not be large, but lawmakers on the Republican-led House Small Business Committee emphasized the importance of such companies.

“Contracting with small businesses is good for the economy and it’s good for the taxpayer because small companies bring cost-savings to the federal government,” Sam Graves (R-Mo.), the committee chairman, said in a statement. “But when federal agencies don’t live up to their end of the bargain, small businesses are discouraged from competing and taxpayers lose the benefits of government efficiency.”

The agency did not fulfill a “guaranteed minimum payment” clause outlined in many of its contracts, the report said.

Keep reading this article at: http://www.washingtonpost.com/business/on-small-business/exclusive-gsa-failed-to-pay-thousands-of-small-government-contractors-since-2008/2013/05/15/305c4422-bd93-11e2-9b09-1638acc3942e_story.html 

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MAS vendors don’t always provide accurate information or qualified labor, says GSA OIG

May 21, 2013 by

The General Services Administration still permits vendors that provide  inaccurate commercial sales data and supply unqualified labor to remain on  schedules contract vehicles, says the agency’s inspector general.

In the report, auditors say problems related to vendors providing accurate commercial  sales practices and providing price justifications improved somewhat from fiscal  2010 to fiscal 2011, but still remain a concern. The prevalence of unqualified  labor rose in fiscal 2011.

While the prevalence of CSP issues dropped 14 percent from fiscal 2010,  auditors still found that more than two-thirds of vendors in preaward audits  during fiscal 2011 provided contracting officers with flawed CSP information  that “adversely affected the contracting officers’ determination of fair and  reasonable pricing for those contracts,” says the report.

Problems include instances when schedule contractors offered discounts at a  level greater than they disclosed to GSA, auditors say.

Keep reading this article at: http://www.fiercegovernment.com/story/mas-vendors-dont-always-provide-accurate-information-or-qualified-labor-say/2013-03-11

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Commerce employees made improper purchases with Pcards, IG report says

May 20, 2013 by

Commerce Department employees in 2011 made improper transactions with  department purchase cards that included transactions that exceeded the card  holders limit, a May 2, 2013 Commerce Department Inspector General report says.

In fiscal 2011, Commerce staff used 4,515 purchase cards for 265,423  transactions, spending $118,628,549, the report says.

Errors included incomplete and mission documentation of transactions, lack of  evidence of available funds and legitimate government need and lack of vendor  invoices and payment receipts, the report says.

There were procedural errors as well. Cardholders inappropriately paid state and  local sales tax, did not pay invoices within 30 days and faxed purchase card  information, the report says. Commerce improperly paid about $292,619 in state  and local taxes, the report says.

Keep reading this article at: http://www.fiercegovernment.com/story/commerce-employees-made-improper-purchases-agency-cards-report-says/2013-05-14?utm_medium=nl&utm_source=internal 

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DLA will use sequester, other cuts to make big changes in how it buys

May 18, 2013 by

The Defense Logistics Agency is using the current budget environment to its advantage, leveraging the culture of cuts into transformative changes at the Pentagon’s logistics arm.

Vice Adm. Mark Harnitchek, the DLA director, told attendees of Government Executive’s Excellence in Government conference Monday that cuts at the Defense Department have led to increased pressure to institute a culture of change.

“It definitely helps,” Harnitchek said of the culture. “We’re standing on a burning bridge here.”

DLA will meet its planned budget cuts — $10 billion over the next five years — by doing more with less, Harnitchek said.

Keep reading this article at: http://www.govexec.com/defense/2013/05/defense-agency-will-use-sequester-other-cuts-make-big-changes/63136/

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Sequestration ‘devastating military readiness’ but not affecting most military construction projects

May 17, 2013 by

During a Senate hearing on May 9, 2013 regarding President Barack Obama’s $9.5 billion military construction budget request for fiscal 2014, Defense Department Comptroller Robert F. Hale said the severe and abrupt budget cuts imposed by sequestration are devastating the U.S. armed forces.

Hale and John Conger, acting deputy undersecretary of defense for installations and environment, testified on military construction and family housing before the Senate Appropriations subcommittee on military construction, veterans affairs and related agencies.

The officials described for the panel the impact of sequestration on military construction, facilities sustainment and restoration, and on the services in the current year.

“While sequestration and related problems do not affect most military construction projects, they are devastating military readiness,” Hale told the senators, adding, “I just can’t believe what we’re doing to the military right now.”

Summarizing the defense budget as a whole, Hale said, “We’re requesting $526.6 billion in discretionary budget authority. It’s about the same as our 2013 request but about 8 percent higher than we’re executing right now in 2013 under sequestration.”

Beyond 2014, he said, “If we’re able to carry out the president’s plan, we anticipate increases of about 2 percent a year, roughly enough to keep up with inflation.”

The overall budget request represents the amount the president and Defense Secretary Chuck Hagel believe is needed to support national security interests in a time of very complex challenges, Hale said.

“Our request does not take into account a possible $52 billion reduction if sequester becomes an annual event,” the comptroller said. “But the president has submitted a budget with a balanced deficit reduction plan of $1.8 trillion over 10 years — more than enough to meet the targets of the Budget Control Act.”

Hale added, “We strongly hope that Congress will pass this plan or another plan that the president will sign, and then repeal sequestration.”

For fiscal 2014 the department is seeking $9.5 billion for military construction, an amount that’s roughly equal to the president’s request of $9.6 billion in fiscal 2013, and $11 billion for family housing, he said.

On the military construction side, DOD is seeking $3.3 billion for operational training facilities, as well as $0.9 billion for modernizing medical facilities, 17 dependent school projects and many others; and $1.5 billion for the family-housing program to provide quality, affordable housing for military families.

In terms of sequestration’s effects on military construction, the comptroller said, most accounts won’t experience sequester-related cuts in 2013 because of special crediting provisions in the current law that apply when Congress enacts major cuts in an appropriation.

“The law says, ‘Cuts are big enough, there’s no further sequestration,’” Hale said.

But facilities sustainment and restoration and modernization projects already have been cut severely in fiscal 2013, Hale said, adding, “We’re essentially down to pretty much safety-of-life and -property projects for the rest of the year.”

In his remarks to the panel, Conger underscored the negative effects of sequestration on facilities’ sustainment and restoration accounts.

Because operation and maintenance dollars are more discretionary and thus more flexible, he said, facilities’ sustainment was cut more deeply to make up the difference.

“In FY 13 we are deferring all but the most critical repairs,” the deputy undersecretary added. “We’re deferring routine maintenance. We’re holding off on major purchases and accepting risk by looking for building equipment to hold out longer.”

Frankly, he said, “we can accommodate this for a short period of time but facilities will break if we short-change these accounts for multiple years. Building systems will begin to fail. The cost to repair broken systems is much higher than that to maintain them, just like changing the oil in your car” prevents expensive auto repairs or system failures.

Keep in mind, he added, “that this ‘car’ is actually a real-property portfolio of more than 500,000 facilities and a plant-replacement value of more than $800 billion. If we don’t invest in keeping it up, it will deteriorate and we will end up with a steady increase in failing or unusable facilities.”

Hale said the department is still researching specific impacts of sequestration on military construction, but for those that so far are affected, “mainly Navy and defense-wide, we believe we can absorb most of the sequestration reductions with available … savings. We don’t intend to reduce the scope of any construction projects. At least (right) now we don’t believe that will be necessary.”

The department also plans to minimize the number of projects deferred or cancelled as a result of sequestration, Hale told the panel, but “we will have to do a larger-than-normal number of reprogrammings, which will add to our work load and also to yours.”

The proposed DOD base budget was built on several guiding principles, Hale said, in particular the need to continue to serve as good stewards of taxpayer dollars.

In that effort, he added, proposed initiatives range from health care and energy efficiency to weapon terminations, and include a new round of base realignment and closure, called BRAC.

“To cut long-term costs we need to consolidate infrastructure and reduce it,” the comptroller said. “The only effective way to do that is for Congress to authorize a new round of base realignment and closure, so we asked for a round in 2015.

“BRAC does save money … We’re saving $12 billion a year from the past BRAC rounds,” he said, adding, “I hate to think what I’d be doing right now as comptroller of the Department of Defense if, especially in this environment, I had to find another $12 billion of savings in the fiscal 14 budget.”

The department needs congressional support, Hale said, “so we can make further cuts in infrastructure in 2015 and hold down the dollars the American taxpayers have to give us to meet their national security needs.”

In addition to being good stewards of public funds, he added, “We … are seeking to strengthen our alignment to the president’s defense strategy that was announced last year. We also seek a ready force and try to put emphasis on people. But frankly, sequestration is seriously undermining both of those goals.”

Source: Armed Forces Press Service – http://www.af.mil/news/story.asp?id=123348049 

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DoD contractors lobby Congress against competition

May 16, 2013 by

As the Army prepares to choose the new builder of its handheld digital radios, the incumbent contractors are tryiing to convince Congress to keep other companies out. The incumbents are General Dynamics, which publicly apologized to the Army over its half of the program last year, and Rockwell Collins. The Army’s own chief of acquisitions, Lt. Gen. William Phillips, told the Senate Armed Services Committee just yesterday that “the industry partners that were not a part of the program of record” — i.e.  the troubled JTRS (Joint Tactical Radio System) program, which had contracted Rockwell and GD — provided “radios that were cheaper, better capability and met almost all of our requirements in most cases”. The service, he said, was committed to “full and open competition.”

We saw a similar play already last year, albeit slightly later in the legislative process, when Reps. Dave Loesback and Trent Frank offered an amendment – later withdrawn – that would have required competitors to meet stringent conditions that effectively ruled out radio-builder Harris and other outsiders, thereby protecting General Dynamics. This time it is co-incumbent Rockwell Collins, which splits the current contract with GD, that’s leading the charge.

Keep reading this article at: http://breakingdefense.com/2013/05/09/army-radios-contractors-lobby-congress-against-competition

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Most top contractors increased business with federal government in 2012

May 15, 2013 by

A majority of the top 200 government contractors made more money on federal awards last year than in 2011, despite major budgetary cutbacks, according to a report released Wednesday.

Overall, the federal government spent $516.3 billion on contracts in fiscal 2012, down 3.1 percent from fiscal 2011’s total of $532.6 billion, the largest year-over-year decline in inflation-adjusted dollars since 1997, the analysis said. Sixty-four percent of that total went to the top 200 companies doing business with the government.

Bloomberg Government, which published the report, analyzed data from 24 agencies and departments, and in 20 categories of federal purchases. Bloomberg found that many contractors were able to maintain or increase business by focusing on sectors that were not subject to “budget pressures,” such as space vehicles, drones, health information technology and cybersecurity.

Keep reading this article at: http://www.govexec.com/contracting/2013/05/most-top-contractors-increased-business-federal-government-2012/63049/?oref=skybox 

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Longtime whistleblower at the Defense Contract Audit Agency keeps discontent alive

May 14, 2013 by

The Defense Contract Audit Agency has racked up its share of detractors over the years, being accused everything from slow processing of reports to leniency toward contractors who overbill the government.

But perhaps its most insistent critic is neither the Government Accountability Office nor a peacenik advocacy group, but one of its own auditors. George Duggan, a Northern California certified public accountant who has spent 25 years with DCAA, has been blasting his superiors since the 1990s, landing him more than once in the role of whistleblower in a Federal Claims Court and before the Merit Systems Protection Board.

Under Director Patrick Fitzgerald since 2009, DCAA has implemented a range of reforms, chief among them the importation of fresh management blood and a risk-based triage strategy for focusing on audits most likely to return money to the treasury. But Duggan insists the agency — and its overseers in the Defense Department Inspector General’s Office — could do better.

Keep reading this article at: http://www.govexec.com/defense/2013/05/longtime-dcaa-whistleblower-keeps-discontent-alive/63027/?oref=national_defense_nl.

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As federal belts tighten, contractor CEOs enjoy million-dollar raises

May 13, 2013 by

On the same day in March that Lockheed Martin warned that the sequester could lead to thousands of employee furloughs and layoffs, the nation’s largest federal contractor disclosed that it had just boosted the compensation of its former CEO by more than $2 million.

Former Lockheed CEO Robert Stevens, who retired as CEO on Jan. 1 but remains chairman, saw his overall compensation rise from $23.4 million in 2011 to $27.5 million in 2012, according to Securities and Exchange Commission (SEC) forms.

The disclosure shows how even with a looming sequester, budget standoffs and defense cutbacks, federal belt-tightening hasn’t yet hit the wallets of top executives for some of the nation’s biggest federal contractors.

Keep reading this article at: http://www.federaltimes.com/article/20130423/ACQUISITION03/304230001/As-federal-belts-tighten-contractor-CEOs-enjoy-million-dollar-raises 

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Feds investigate office supply vendor

May 10, 2013 by

The government is investigating whether an office supply contractor has been improperly selling products made in China in violation of the Trade Agreements Act, court records show.

The General Services Administration’s inspector general’s office has been investigating Florida-based Capitol Supply Inc. for more than two years, according to a motion the IG filed earlier this week in U.S. District Court in Washington. The motion asks a judge to force Capitol Supply Inc. to turn over billing, sales and other information in response to two subpoenas.

Separately, the Justice Department this week joined in a False Claims Act lawsuit filed against Capitol Supply. The suit, filed back in 2010 but unsealed on Monday, accuses the company of selling illegal office products to the government.

Keep reading this article at: http://www.federaltimes.com/article/20130418/ACQUISITION03/304180004/Feds-investigate-office-supply-vendor

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