Temporary ‘bridge contracts’ risk overpayments

Temporary extensions of contracts without competitive bids, a common practice at many large agencies, may waste money and misallocate staff time if the government doesn’t come up with a precise definition for the process, a watchdog found.

GAO-GovernmentAccountabilityOffice-SealSo-called “bridge contracts” are not defined in the Federal Acquisition Regulation, the Government Accountability Office noted in a report released October 15, 2015. It characterized such awards as the extension of an existing sole-source contract to an incumbent contractor to ensure there is no gap in services.

In a review of 73 such contracts at the departments of Defense, Health and Human Services, and Justice, auditors found “limited or no insight into their use of bridge contracts, as bridge contracts were not defined or addressed in department-level guidance.” The exceptions GAO found are two DOD components, the Navy and the Defense Logistics Agency, which “have instituted definitions, policies, and procedures to manage and track their use.”

Keep reading this article at: http://www.govexec.com/contracting/2015/10/temporary-bridge-contracts-risk-overpayments/122861/

Agency’s “cut-and-paste” proposal evaluation upheld

An agency’s evaluation of proposals was not improper even though the Source Selection Authority “cut and paste” portions of a selection document used in a similar procurement – including typographical errors and a reference to a firm that had not submitted a proposal.

GAO-GovernmentAccountabilityOffice-SealThe GAO’s recent decision highlights an uncomfortable truth of government contracting: while the government can (and often does) demand nearly perfect proposals, the government may be able to get by with sloppy or lazy evaluations.

The GAO’s decision in Noble Supply and Logistics, B-410877.4 et al. (July 29, 2015) involved a DLA solicitation for maintenance, repair and operations supplies in the DLA’s south central region, geographical zones 1 and 2.  The solicitation called for two contracts to be awarded, one for each geographical region.

Keep reading this article at: http://smallgovcon.com/gaobidprotests/agencys-cut-and-paste-proposal-evaluation-upheld/

GAO says GSA needs to pay more attention to competition and prices on Schedule contracts

Only 40 percent of orders placed against GSA Schedules in FY14 were based on three or more quotes — the number required by the Federal Acquisition Regulation (FAR).

This finding comes as a part of a recently-released Government Accountability Office (GAO) report.

Competition - GSA Schedule Orders - FY14

According to the General Services Administration (GSA), total sales through the Federal Supply Schedules (FSS) program in fiscal year 2014 were $33.1 billion. This includes purchases by federal, state, and local agencies, including federal intelligence agencies which do not report their FSS spending publicly. GAO’s analysis of publicly reported federal procurement data shows that federal use of the FSS program has declined from $31.8 billion in 2010 to $25.7 billion in 2014 — a 19 percent inflation-adjusted decrease. This is consistent with the decline in overall federal contracting obligations. The FSS portion of total federal contracting obligations remained steady — between 5 and 6 percent.

The extent of competition on GSA Schedule orders is influenced by various factors. One factor identified in the orders from the agencies GAO reviewed — the Departments of Defense (DOD) and Health and Human Services (HHS) and GSA — involves situations where few vendors can fulfill agencies’ specific needs.

HHS had a significantly higher percentage of FSS obligations in fiscal year 2014 on orders that were competed but the agency received only one or two quotes — 51 percent — compared to DOD and GSA, which received one or two quotes for 35 and 32 percent of their FSS obligations, respectively. HHS’s practice of targeting solicitations to fewer vendors may be contributing to this higher rate.

The bottom line?  Agencies are paying insufficient attention to prices when using FSS, according to GAO.  Ordering agencies did not consistently seek discounts from Schedule prices, even when required by the FAR. In addition, GAO found cases in which officials did not assess prices for certain items, as required, or had insufficient information to assess prices. Contracting officials were not always aware of the requirement to seek discounts and told GAO that the need to assess prices was not emphasized in training and guidance. When contracting officials are not aware of these regulations, agencies may be missing opportunities for cost savings.

Why GAO Did the Study

The FSS program provides agencies a simplified method of purchasing commercial products and services at prices associated with volume buying. In 2011, the FAR was amended to enhance competition on FSS orders. Competition helps agencies get lower prices on products and services and get the best value for taxpayers.

In its report, the GAO examined competition and pricing for FSS orders. The report addresses: 1) how and to what extent the government is using the FSS program, 2) factors influencing the degree of competition for FSS orders, and 3) the extent to which agencies examine prices to be paid for FSS orders.

GAO analyzed data from the Federal Procurement Data System-Next Generation on obligations through the FSS program for fiscal years 2010-2014 and reviewed a non-generalizable sample of 60 FSS orders awarded in fiscal year 2013 by DOD, HHS and GSA, the agencies with the highest use of the FSS program. GAO also interviewed officials from these agencies and FSS vendors.

What GAO Recommended

GAO recommends that DOD, HHS and GSA issue guidance and assess training to focus attention on rules related to pricing. DOD, HHS and GSA concurred. GAO also recommends HHS assess reasons contributing to its higher rate of orders with only one or two quotes. HHS concurred.  The complete GAO report, publicly released on August 10, 2015, may be seen at: FSS – More Attention Needed to Competition and Prices.

Agency pulls a fast one at GAO … and gets caught

After a protest was filed at the GAO, a procuring agency delayed implementing the mandatory statutory suspension of work, then amended the awardee’s contract to permit the awardee to fully perform before the suspension actually kicked in.
Then the agency got caught.

GAO-GovernmentAccountabilityOffice-SealIn a recent decision, the GAO sustained a protest because the agency had circumvented the GAO’s bid protest process.  But while the agency got busted–a good thing–the penalty it will pay is less than satisfactory.

The GAO’s decision in SCB Solutions, Inc.–Reconsideration, B-410450.2 (Aug. 12, 2015) involved a Dept. of Veterans Affairs (VA) RFQ for personal identity verification cards.  The RFQ was issued via the GSA’s eBuy system to holders of GSA Schedule 70 contracts.  The RFQ stated that award would be made on a lowest-priced, technically-acceptable (LPTA) basis.

VA sealThe RFQ called for the issuance of a single, fixed-price delivery order for 400,000 PIV cards.  The PIV cards were to be provided in five production runs of 80,000 each.  Within 30 days of award, the contractor was to deliver a test run of 100 cards.  After the agency accepted the test run, the contractor was to deliver the remainder of the first production run; delivery of the other production runs would follow.

Keep reading this article at: http://smallgovcon.com/gaobidprotests/agency-pulls-a-fast-one-at-gao-and-gets-caught/

GAO faults ‘unreasonable market research’ for failure to set aside contract for SDVOSBs

In an August 20, 2015 ruling, the U.S. Government Accountability Office (GAO) found that the Department of Veterans Affairs (VA) conducted insufficient market research in connection with an acquisition and therefore had no grounds for denying set-aside status to the contract.

VA sealThe VA issued an RFP on April 27, 2015, as a small business set-aside, requesting proposals to provide fire and life safety A/E services for Veterans Integrated Service Network (VISN) 20 region medical centers located in Washington, Oregon, Idaho, and Alaska.

Fire Risk Management, Inc. (FRM), of Bath, Maine, protested the bid based on the VA’s failure to set aside for service-disabled veteran-owned small business (SDVOSB) concerns.  FRM asserted that the VA’s decision not to set aside the acquisition for SDVOSBs was based on unreasonable market research.

In defending its decision, the VA stated its belief that it would not receive proposals from at least two responsible SDVOSB concerns that could meet the requirements in the RFP at a fair market price.  But the GAO disagreed, concluding that the VA’s determination that there was not a reasonable expectation that offers would be received from at least two SDVOSB firms that are capable of performing the required work was not supported by the record.

The GAO found that the VA’s contract record did not support the agency’s determination to limit its market research to firms only within the VISN 20 region.  The GAO took note of the fact that the VA’s contract specialist, in a database search specifically directed by the contracting officer, found more than 127 profiles of SDVOSB concerns nationwide “matching the criteria.”  The GAO concluded that had the agency expanded its market research beyond the VISN 20 region it would have discovered numerous SDVOSB A/E concerns doing fire protection work.

In its decision, the GAO recommend that the VA’s contracting officer conduct a proper market survey in accordance with the agency’s requirements for this procurement to ascertain whether there is a reasonable expectation that at least two or more responsible SDVOSB concerns will submit proposals at fair market prices.   The GAO also recommend that the VA reimburse the FRM for the reasonable costs of filing and pursuing the protest, including reasonable attorneys’ fees.  The protester’s certified claim for costs, detailing the time spent and the costs incurred, must be submitted to the VA within 60 days after receipt of the GAO’s decision.

The text of the GAO’s full decision can be found at: http://www.gao.gov/products/B-411552#mt=e-report.