F-35’s operating cost to decline, says DoD acquisition chief

The Pentagon will decrease its $1.1 trillion estimate for the cost of supporting Lockheed Martin Corp. (LMT)’s F-35 fighter jet over a 55-year lifespan, the top U.S. weapons buyer said.

“It will drop to a number that’s not trivial but is not as much” a reduction “as I would like,” Frank Kendall, the Defense Department’s undersecretary for acquisition, said April 3, 2014 at a Bloomberg Government breakfast in Washington.

While debate over the aircraft, the costliest U.S. weapons system, has focused mostly on the price to develop and build the fighter, Pentagon agencies also have disputed its long-term operating costs, from spare parts to repairs.

Kendall declined to elaborate on the reduced 55-year estimate by the department’s independent cost-assessment office. The figure will be released later this month in its next unclassified Selected Acquisition Report. Until then, the official projection is the $1.1 trillion formulated by that office three years ago.

By contrast, the Pentagon’s F-35 program office estimates that the fleet will cost $857 billion to operate and support over its lifetime.

On the separate cost of developing and producing a planned fleet of 2,443 F-35s, the U.S. Government Accountability Office said in February that its projection is $390.4 billion, as adjusted for inflation over the years the plane is produced. The Pentagon’s latest estimate by the same measure is $391.2 billion, about a 1.1 percent reduction from an earlier calculation.

Keep reading this article at: http://www.bloomberg.com/news/2014-04-03/lockheed-f-35-s-operating-cost-estimate-to-decline.html 

Scam targets GSA schedule holders using spoofed federal email addresses

The General Services Administration’s schedules program has been victimized by spear phishing attacks costing vendors more than $1.5 million, and law enforcement officials say, is increasing.

GSA alerted Schedule 70 and 75 vendors Wednesday that since July 2012 the FBI, the Environmental Protection Agency and GSA inspectors general have been investigating a series of fraudulent orders placed online to GSA vendors from criminals posing as federal contracting officials, according to an email to Schedule-70 and 75 vendors, which Federal News Radio obtained.

The hackers ordered HP printer toner cartridges using official federal employee email credentials but fake phone telephone numbers and stolen credit cards.

Law enforcement officials now say scammers are targeting orders for laptop computers, though it’s unclear if these two cases are related. But GSA said “there are some significant similarities and we’re following up on investigative leads to make further determinations.”

Keep reading this article at: http://www.federalnewsradio.com/490/3595717/Scam-targets-GSA-schedule-holders-using-spoofed-federal-email-addresses 

Army’s bright acquisition spot: Howitzer upgrades

The U.S. Army is moving forward with plans to develop upgraded versions of the M109 self-propelled howitzer in one of the service’s few bright acquisition spots.

The Army is “fully committed” to the M109 Paladin Integrated Management, or PIM, program, Army Secretary John McHugh said on Thursday during a hearing of the House Appropriations Defense Subcommittee.

“We need a new self-propelled artillery howitzer to keep up with our formations and so we’re going forward,” he said in response to a question from Rep. Tom Cole, R-Okla., whose district includes Fort Sill, which houses the Army and Marine Corps’ field artillery schools.

McHugh acknowledged the service’s troubled acquisition history, including many failed attempts to replace its Cold War-era fleets of vehicles and helicopters. Most recently, it scrapped the Ground Combat Vehicle, designed to replace the Bradley fighting vehicle, due in part to automatic budget cuts known as sequestration.

But the secretary said the M109 development program is moving forward, albeit slowly. BAE Systems Land & Armaments LP, part of the U.S. subsidiary of the London-based defense contractor, received a contract potentially worth almost $700 million for initial production of the vehicles.

Keep reading this article at: http://www.dodbuzz.com/2014/03/27/armys-bright-acquisition-spot-howitzer-upgrades/ 

Agencies setting off into the next data frontier — procurement

Agencies are starting to grasp the real value of procurement data. Several agencies are asking the General Services Administration, NASA and others for more details on what they buy, how they buy it and how they could make better decisions.

NASA, for example, is working closely with the Veterans Affairs Department to provide them with an assortment of data points around energy efficiency, such as how VA’s IT products are rated for Energy Star or E-Peat. NASA also plans to provide VA with information about how their purchases meet the Trade Agreements Act and about their buying habits based on product classifications.

Joanne Woytek, the program manager for NASA SEWP governmentwide acquisition contract, said the fact that VA and other agencies are asking for and receiving this type of data is a sign of maturity for both the GWAC providers and the agencies in understanding what’s available and why the data matters.

“I’ve seen this happening more with our contracts and SEWP V. A lot of what we are putting into that is to make it a more mature model. We can’t just say, ‘we can do that,’ we will actually demonstrate the things we can do,” she said at the 2014 Acquisition Excellence conference in Washington Thursday sponsored by GSA, the Homeland Security Department and ACT-IAC. “We will be able to show agencies what they are buying. We’re going to be able to provide them with more information. We always said we could do that, but we actually are going to start doing that. I think that’s going to have a bigger effect on agencies who no longer will say ‘I don’t want to use you because I’m not sure you can give me that information. I’m not sure you can control what we’re purchasing.’ We can do that for them and we’ll actually start showing that. So I see us having a better impact on people now that we’ve gotten to this point.”

Keep reading this article at: http://www.federalnewsradio.com/?nid=533&sid=3587330&pid=0&page=1 

Cheapest contract isn’t always the best, acquisition officials say

Confusion over “lowest price, technically acceptable” contracts have rendered the Pentagon’s acquisition workforce “brutalized” by critics and the press who mistake shrinking defense budgets for a lack of ambition for innovation, a top acquisition official said Thursday.

Katrina McFarland, assistant Defense secretary for acquisition and past president of the Defense Acquisition University, said “Low-cost, technically acceptable is good when appropriate, but shouldn’t be used to achieve innovation.” Her “very junior-level” acquisition workforce has a learning curve when it comes to taking the next step toward value added in contracts, McFarland told several hundred industry and government executives at a conference titled “Agility, Velocity and Service Excellence” sponsored by the General Services Administration, the Homeland Security Department and the American Council for Technology-Industry Advisory Council.

Seeking industry input on how to prioritize Defense spending on weapons and information technology, McFarland gave a capsule history of how the acquisition workforce in the 1990s was cut by 20 percent to “reap the peace dividend,” and how, following the 9/11 terrorist attacks, the civilian force was then flush with money and focused more on “pushing product out the door to the warfighter. We weren’t focused on honing business skills or maintaining a good customer-provider relationship,” she said.  “We were a bad customer.”

An injection of money by Congress in 2008 allowed planners beginning in 2010 to assemble 53 experts from agencies and industry and boil down 325 proposed initiatives to 23, which eventually resulted in the Pentagon’s pair of Better Buying Power initiatives. These include rewards and incentives for the workforce, McFarland noted, including the first-ever visits to contractor sites by deputy and undersecretaries to explain “from the horse’s mouth” the distinctions between low-cost contracts, value-added innovations and affordability in the context of the long-term costs of ownership of a system. “Instead of beating the workforce about the ears, it is a guide to help you think,” she said. If the workforce doesn’t understand low-cost technically acceptable, it will fumble around a bit,” she added, telling the business representatives, “if [acquisition] people ask questions and say this is not logical, do not stop them,” for this is how risks are taken that succeed.

Keep reading thgis article at: http://www.govexec.com/management/2014/03/cheapest-contract-isnt-always-best-acquisition-officials-say/80965

What went wrong with GSA’s Networx transition?

A pair of internal analyses by the General Services Administration finds much to criticize in the structure of federal telecommunications contract Networx, portraying it as too complex, inflexible and mismatched to the way agencies buy telecom services.

The Government Accountability Office has estimated that a protracted agency transition to Networx from the predecessor governmentwide telecommunications contract caused agencies to miss out on $329 million worth of savings and GSA to spend an extra $66.4 million on supporting it. In the end, the transition took three years longer than anticipated.

GSA provided the two reports – one from July 2012, another from September 2012 – after FierceGovernmentIT submitted a Freedom of Information Act request for them. Agency officials decided to release the documents independently of FOIA, and we withdrew the request after being promised the reports.

Among the observations the analyses make is that while GSA initially defined more than 50 telecom services for Networx, only six services account for more than 80 percent of business volume.

“Networx has thousands of contract line items and millions of service permutations,” the July 2012 report says. “It is no surprise that agencies indicate the Networx program is too complex.”

Keep reading this article at: http://www.fiercegovernmentit.com/story/what-went-wrong-networx-transition/2014-03-10

Major departments seek continuous monitoring acquisition independence from DHS

Some federal agencies are choosing to buy continuous monitoring tools independently of the Homeland Security Department’s Continuous Diagnostics and Mitigation Program despite forfeiting DHS procurement money for those tools when doing so.

Those agencies have sought and received a “delegation of procurement authority” from the CDM program. That means they are able to use the blanket purchase agreements for security tools set up by GSA for the CDM program. But, if they exercise the delegation by buying tools themselves rather than through program office, they do it “with their own money,” said Jim Piché, a GSA acquisition manager newly appointed to overseeing the blanket purchase agreements.

A GSA spokeswoman said the agency won’t release a list of the agencies that received a delegation.Piché spoke Wednesday during a Washington, D.C. industry-sponsored panel on the program.

An industry source says agencies with a delegation include the departments of Agriculture, Homeland Security, Justice and Veterans Affairs.

Keep reading this article at: http://www.fiercegovernmentit.com/story/major-departments-seek-continuous-monitoring-acquisition-independence-dhs/2014-03-19

Acquisition infrastructure takes a village

Problems in government contracting today include complex issues of pricing, staffing, and outcomes. Solutions are often arrived at quickly; new legislation or regulation, adopting commercial practices, adding or reducing staff and oversight. Wherever we lie on the oversight or streamlining continuum, we always seem to want to get to the other side. Short term actions result in winners and losers, but long-term results don’t significantly change.

Government agencies are now largely dependent upon contract support to meet their mission. Yet, their organizational structure doesn’t reflect this new dependence. A robust contracting infrastructure in both the public and private sectors is necessary and must include the knowledge and experience embodied in professional competencies in program management, system engineering, finance, quality assurance, property, logistics, information technology, etc. to positively impact program outcomes and reflect organizational leadership and culture. These core competencies are necessary to plan and execute a mission that reliant on contracted support of products and services. GAO’s acquisition framework includes an analysis of organizational structure and placement when reviewing risk factors for agency success.

Keep reading this article at: http://www.federaltimes.com/article/20140303/BLG06/303030008/Acquisition-infrastructure-takes-village 

DHS to centralize budgeting, acquisition

The Department of Homeland Security is beginning to centralize its budgeting and acquisition processes in order to boost efficiency, according to DHS Secretary Jeh Johnson.

At a Senate Homeland Security and Governmental Affairs hearing March 13, Johnson said that for future requests the agency will first conduct a headquarters review of its goals and strategies and provide budget guidance to agency components.

“We are creating a budget process that is mission-based,” Johnson said.

Keep reading this article at: http://www.federaltimes.com/article/20140313/DHS03/303130011/DHS-centralize-budgeting-aquisition

DoD a top spender on GSA’s governmentwide contracts

Nearly $1 billion has flowed through the General Services Administration’s governmment-wide contracts this year, with SAIC and SRA International among the companies receiving the bulk of that business.

Defense components and the military services account for nearly half of the spending across GSA’s five GWACS, which include 8(a) STARS, 8(a) STARS II, Alliant, Alliant Small Business and VETS.

DoD, which includes defense agencies, has obligated $230 million in task orders against the GWACS. The Air Force Headquarters obligated $167 million in funding, and the Army has spent $110 million as of March 10, according to GSA data.

SAIC, SRA International and Lockheed Martin have seen the largest share of business under the GWACS this year.

Keep reading this article at: http://www.federaltimes.com/article/20140310/ACQ01/303100005/DoD-top-spender-GSA-s-governmentwide-contracts