OFPP | The Contracting Education Academy

November 9, 2011 By AMK

New rule funnels more contracts to small businesses

Under a proposed new rule, small companies are expected to get more business through multiple-award contractors because that’s where the money has increasingly been going since the mid-1990s.

Regulators have revised the Federal Acquisition Regulation (FAR) to match the fluctuation toward task-order contracts, such as governmentwide acquisition contracts, blanket purchase agreements and agencywide contracts. The Office of Federal Procurement Policy has pushed those types of vehicles to streamline purchasing and get lower prices.

Officials released an interim rule Nov. 2 about the FAR revisions. The rule took effect the same day.

The changes make clear that contracting officers can set aside orders for small businesses both on blanket purchase agreements under the General Services Administration’s Multiple Award Schedules and on multiple-award contracts.

The revisions add a new section in the FAR. It authorizes agencies to set aside one or more contracts for small business on a multiple-award contract, including any of the socioeconomic programs, such as the service-disabled, veteran-owned small business program.

Officials are hopeful for what the changes will bring to small businesses. at the Defense Department, GSA, and NASA expect agencies to take advantage of the set-aside revisions. They want agencies to identify possible multiple-award contracts through which they could set- aside orders for small businesses. They also want agencies to set aside more orders when using GSA’s Schedules, according to the notice.

The changes are based on law and an advisory group.

Congress included language in the Small Business Jobs Act, which became law in 2010, addressing set-asides among task and delivery orders.

Also in 2010, an interagency panel, which was created by President Barack Obama to study small-business contracting, found the issue needed some attention since multiple-award contracts have become so popular.

“There has been no attempt to create a comprehensive policy for orders placed under either general task-and-delivery-order contracts or Schedule contracts that rationalizes and appropriately balances the need for efficiency with the need to maximize opportunities for small businesses,” the Task Force on Small Business Contracting wrote in its report.

About the Author: Matthew Weigelt is a senior writer covering acquisition and procurement for Washington Technology. Published Nov. 3, 2011 at http://washingtontechnology.com/articles/2011/11/03/small-business-set-asides-multiple-award-contracts.aspx?s=wtdaily_041111

November 7, 2011 By AMK

Search is on for Gordon’s OFPP successor

During his two years as OFPP administrator, Dan Gordon worked on a variety of acquisition issues from improving and standardizing the workforce to pushing for more industry and agency communication through his “mythbusters” campaign.

Now, on the heels of the announcement that he will step down from his post for an associate dean position at George Washington University Law School, government procurement watchers are asking: What’s next?

The length of Gordon’s tenure — about two years — is comparable to that of other administrators in recent history, said former OFPP administrator Angela Styles in an interview on the the Federal Drive with Tom Temin and Amy Morris.

“It’s a hard job; it’s a 24/7 job,” she said. “And after a while, it wears you out.”

Styles, herself, stepped down as the head of the office in 2003, after about two-and-a-half years on the job.

There are “tough policy issues” to grapple with every day, she explained. And they often occur in the glare of the media spotlight, she added. “They’re really issues that are both substantive, regulatory issues and political and policy issues that come up every day.”

Gordon’s legacy

While an official date for Gordon’s departure hasn’t been set, the experts are already evaluating his legacy.

“I think he was a strong steady hand there,” Styles said. “I think he understood the acquisition workforce; he understood how procurement works. He showed that there can be a really strong leader in that job that can do it effectively, that can make very significant changes,” she added, citing, for example, his work on cutting back on the growth of multiple-award contracts.

Al Burman, a former OFPP adminstrator who’s now the president of Jefferson Consulting, pointed to Gordon’s efforts at bolstering the government’s acquisition workforce.

“We’ve had so many issues with workforce,” Burman said and Gordon said recognized “that we really need to beef up the folks that are doing this job.”

In September, OFPP announced it was revamping the position of contracting officer’s technical representative. The new position — which requires more training — will be known as a contracting officer’s representative.

Gordon has also earned high marks from industry.

Stan Soloway, president of the Professional Services Council, which represents many government contractors, praised Gordon’s “objective and reasoned approach.”

“Whether you agreed with him or not, he was a guy who would always seeks out lots of opinions — he’d listen, he’d respond,” Soloway said in an interview on In Depth with Francis Rose. “And I think he changed the tone of the dialogue in some very critical ways.”

Possible successors

So far, Styles said, there’s no obvious shortlist of obvious replacements.

But whomever is picked as a successor should have a substantive background in government contracts, she said. Previous administrators without that crucial quality have had a much harder time getting up to speed. And whomever takes the reins must be comfortable amid the political fights that the Office of Management and Budget, in which OFPP resides, is often at the center of. “For better or worse, OMB … is a highly political environment,” she added.

The White House will also likely consider picking a successor already in the administration, Burman said, citing the grueling vetting process job candidates will face from Capitol Hill.

“It’s a very difficult and time-consuming process,” he said. “So, trying to get somebody brand-new in and starting from scratch, I think, would be pretty difficult at this time in the process.” Burman said.

Soloway said the calendar doesn’t do the administration any favors.

Even under the best of circumstances it could be months before a candidate is vetted and approved, Soloway said. The chances of getting the administration’s pick confirmed — in an election year when Congressional politicking runs high — are very slim, he said.

And depending on the outcome of the 2012 election, the successor may never actually sit for the job.

“The timing just isn’t great,” Soloway said.

— by Jack Moore, Federal News Radio, Nov. 3, 2011 – http://www.federalnewsradio.com/?nid=517&sid=2617348

November 2, 2011 By AMK

Rep. Lankford says training will ease acquisition workforce transition

The federal acquisition workforce is getting younger and less experienced, and that worries Congressman James Lankford (R-Okla.).

The chairman of the Oversight and Government Reform subcommittee on Technology, Information Policy, Intergovernmental Relations and Procurement Reform said agencies need to do more to train new employees to make the best acquisition decisions.

“We interact with lot of contracting officers that are very dedicated employee as well as contractors that are trying to do the right thing, but there’s a lot of confusion right now, it seems, on what is the right [contract] vehicle to use,” said Lankford in an interview with Federal News Radio. “There seems to be a tremendous transition of individuals where we have new contracting officers or fairly inexperienced ones who are getting their sea legs in this and trying to determine what levels of risk can they take in interpreting some of these rules in the FAR. It’s an interesting time of transition.”

Lankford said vendors tell him their staff knows more about the acquisition rules than many of the contracting officers they deal with.

This dearth of trained acquisition workforce puts agencies at risk for misspending money, he said.

To that end, Lankford is proposing a series of hearings over the next few months to try to educate his counterparts that the “pennywise, pound foolish” approach many in Congress have taken over the years no longer is a good one.

“We get the best value for the taxpayer when the contracting officer and people involved in it know completely, have confidence in what they are doing, can look at all the different vehicles and make good choices,” he said. “We have to allow that contracting officer to look at it and make good, wise decisions, they are the voice of the taxpayer at that point.”

He said the challenge is getting members to understand the benefits of spending a little money to save a lot of money.

“CBO can’t score that. They can’t score a savings a money over potential of better training, better equipped,” he said. “We know it will happen, but at the end of the day when we actually are voting on a bill, they can’t show there’s a savings that we know it’s coming. That comes just through education.”

Two administrations and several members of Congress have tried to improve the training the acquisition workforce receives. The Office of Federal Procurement Policy tried to work with lawmakers to create a acquisition training fund for civilian agencies, similar to the one the Defense Department has for its employees. The administration requested $158 million in 2011 for an acquisition workforce training fund. Congress approved no funding for the fund in either of the last two years.

OFPP tried to go around Capitol Hill by issuing new certification requirements for project managers and contracting officer technical representatives.

OFPP also wants to grow the acquisition workforce by 5 percent by 2014.

The Federal Acquisition Institute found in fiscal 2009 —the latest information available — there were 106,506 employees classified in the 1100 job series or as project/program managers or contracting officer technical representatives.

FAI found the number of 1102s—contracting officers—increased by 3,200 from 2008 to 2009, and up 6,200 since 2000.

The survey also found between 12 percent-and-25-percent of all employees in acquisition workforce positions were eligible to retire in 2009.

Lankford may be getting some help in pushing for more acquisition workforce training.

The Senate Homeland Security and Governmental Affairs Committee passed the Federal Acquisition Institute Improvement Act in June and is waiting debate by the full Senate.

Lankford said the goal is not to create a new bureaucracy for training, but make sure the people in the workforce are well trained.

As a part of training, Lankford said he’s also concerned about the proliferation of multiple award contracts and how they limit competition.

“A contracting officer is going to what’s safe and what they know will work and where they had previous people. If you continue to do multi-award, if you continue to pull on people who have done it in the past and who you know can get it done, it’s the least amount of work and it’s the easiest,” he said. “The challenge of it is how do we start raising up subcontractors into prime contractors? We have to continue to raise up a new generation constantly of subs to primes and we have to get best value. Best value may not be putting all of these things together. We need to be able to reward contracting officers for doing the additional work and provide some incentives for them to go around that because that will save the taxpayer dollar in the end.”

Lankford also wants agencies to use the suspension and debarment process more regularly as a tool to limit bad contractors.

He held a hearing in October on how agencies are using this process, and plans on continuing the subcommittee’s oversight of the process in 2012.

“HHS and DHS both have reports due to us by Christmas this year on their changes that are happening with suspension and debarments,” Lankford said. “Obviously, FEMA has a long way to go on this but they are active in taking that in. HHS, not so much. They’re one of the agencies that have not done suspension and debarments. They said during the hearing it’s their intention to get this done. It’s moving that from intention to actually accomplishing that. They have a tremendous amount of contracts. They can do it. It’s not too difficult. We just have to pay attention to it.”

— by Jason Miller – Federal News Radio – Nov. 2, 2011 – http://www.federalnewsradio.com/?nid=85&sid=2616224

October 25, 2011 By AMK

Procurement chief defends Obama’s commitment to small business

A proposed rule to curb agencies’ little used capacity to offer higher payments to needier contractors “will have no impact on the government’s ability or commitment to drive contracting opportunities for small disadvantaged businesses,” Dan Gordon, administrator of the White House Office of Federal Procurement Policy, said Friday.

In a blog post for the Office of Management and Budget, Gordon sought to reassure some in the minority business community that a proposed regulation issued in September by the Small Business Administration is a routine “housekeeping” tool designed to catch the law up with a 2008 court ruling that declared such price premiums unconstitutional.

“The proposed rule in no way changes the fundamental policies, practices or programs that agencies have been using in recent years to achieve strong SDB participation in the federal marketplace, including the goal of awarding 5 percent of federal procurement dollars to SDBs,” Gordon wrote.

The affected agencies — the Defense Department, NASA and the U.S. Coast Guard — have not used price premiums to attract disadvantaged small contractors in years, Gordon noted. But the administration has “been working with the Minority Business Development Agency to strengthen the bond between contracting, small business and program offices at every agency,” Gordon wrote. “Since the beginning of [fiscal] 2009, agencies have awarded more than $85 billion in contracts to SDBs, exceeding the goal of awarding at least 5 percent of contract dollars to SDBs.” In fiscal 2010, he added, contract awards to small disadvantaged businesses accounted for 7.95 percent of all eligible contract dollars, “well above the goal.”

Gordon’s clarification came as the Obama administration readied a new set of executive actions designed to spur job creation in large and small businesses while Congress debates the president’s larger proposed jobs package.

The perception among some that ending premium payments to disadvantaged businesses was a pullback in the administration’s commitment was rejected by Molly Brogan, vice president of public affairs for the National Small Business Association. “At the end of the day, small businesses just want a level playing field,” she told Government Executive. “Ensuring that small businesses — including SDB businesses — have a fair opportunity to compete for federal dollars ought to be the No. 1 goal. We don’t believe this new rule will change [that] in any way.”

Raul Espinosa, founder of a Jacksonville, Fla. – based university nonprofit called the Fairness in Procurement Alliance, which has been pressing for stronger rules on accelerating payments to small disadvantaged businesses, said he was grateful for the administration’s overall effort, but worries it might be “lip service.” Changes “will mean nothing unless they’re codified into the federal acquisition regulation and referred to in actual contracts,” he said.

— by Charles S. Clark – Government Executive – October 24, 2011 – http://www.govexec.com/story_page.cfm?articleid=49130&dcn=e_tma

October 18, 2011 By AMK

OMB optimistic on effort to change contracting mentality

Office of Management and Budget officials believe agencies are ready to collaborate on multi-agency contracts in order to squeeze the most value out of their funds and lessen their employees’ workload.

“Particularly in this tight budgetary environment, agencies have told us they are eager for tools that can help them stretch a dollar further and do more with less,” Moira Mack, a spokeswoman for OMB, said Oct. 5.

Agencies have dealt long enough with interagency contracts that duplicate one another, Mack said.

“We’ve heard from both contractors and federal employees that, for too long, limited staff time has been wasted setting up dozens of duplicative contracts for the exact same items and services,” she said.

Dan Gordon, administrator of the Office of Federal Procurement Policy, issued a memo in September requiring officials to justify interagency contracts and blanket purchase agreements before investing a lot of time in planning for the procurement. A potential interagency contract would first have to get approval from a senior procurement executive or chief acquisition officer.

Officials would also have to search through a federal website listing proposed interagency contracts. If they find one that suits their need, they should cancel their own contract idea. If no contract suits the need, they should gather support from among the agencies to determine interest in the community, which can possibly lead to bulk buying.

However, experts told FCW that OFPP will struggle with parts of its recent guidance on awarding new interagency contracts and building business cases for proposals.

Robert Burton, former deputy OFPP administrator and now partner at the Venable law firm, said Gordon’s guidance may push agencies toward curbing their own interagency contract awards. He said officials will avoid the homework that OFPP requires to write a business case for an interagency contract or a BPA.

Until now, only governmentwide acquisition contracts, which are for IT products and services, required business cases and approval from OFPP.

On the other hand though, the guidance could possibly cause agencies to launch stand-alone contracts without economies of scale, Burton also said. Agencies don’t like to lose control of their operations or money, and they don’t like paying a fee to use another agency’s contract.

Experts also said OFPP will have its hands full in getting agencies on board with the initiative. For instance, agencies may not jump on the idea of going to a website to see what other contracts are available already. Or agencies may use their writing skills to make a proposed contract seem justified. Mack disagreed though.

“The suggestion that agencies would avoid doing reasonable comparison shopping and cost benefit analysis is dead wrong,” she said. “This guidance will help agencies stop wasting time reinventing the wheel.”

She added that OFPP left out a lot of the bureaucracy to encourage agencies in the effort.

In a post on the OMBlog from Sept. 29, the day the OFPP guidance came out, Gordon wrote that agencies have not received the advantages of bulk buying because purchasing wasn’t done in concert.

“Too often in the past, agency spending for many commonly used items was fragmented across multiple departments, programs, and components, which means that agencies often spent time writing hundreds of separate contracts, with pricing that varies widely,” he wrote.

Mack said agencies have started to buy in bulk in recent years and most recently through governmentwide strategic sourcing contracts for office supplies and domestic shipping.

About the Author: Matthew Weigelt is a senior writer covering acquisition and procurement for Federal Computer Week. This article appeared on Oct. 6, 2011 at http://fcw.com/articles/2011/10/06/ofpp-interagency-contract-guidance-success.aspx.

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