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3 big problems continue to dog federal procurement

Congress and the executive branch have worked for years to improve the quality of and reduce costs for federal acquisition, but some problems continue to hamper many agencies, according to a Sept. 12 Government Accountability Office report.

“Acquisition reform has been on everyone’s agenda for many, many years, decades. There have been proposals in the Congress, there has been changes to the regulations. This has been a very, very active area for a long time,” said Bill Woods, director on the Contracting and National Security Acquisitions Team at GAO, in an agency podcast.

The report evaluated federal agency acquisition improvements against 89 recommendations made by the Acquisition Advisory Panel in 2007 and divided the areas of improvement into three “buckets” that represent the acquisition life cycle: requirements and definitions; competition and pricing; and contractor oversight.

“One is in the requirements, definition process of actually deciding.  What is it does the agency want?  What does it need, and what’s the best way of getting what we need?” said Woods.

Keep reading this article at: https://www.federaltimes.com/acquisition/2018/09/17/3-big-problems-continue-to-dog-federal-procurement/

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VA official charged with taking bribes to help associates rig federal contracting process

Three men were arrested in Colorado on Wednesday of this week pursuant to warrants issued in connection with an indictment charging them with conspiring to pay and receive bribes in exchange for creating an opportunity to commit a fraud against the U.S.  Department of Veterans Affairs (VA). 

The defendants are also charged with paying and receiving bribes, or aiding and abetting the payment of bribes.

Dwane Nevins, a VA contracting official at the time of the alleged crimes, was separately charged in another count with extortion under color of official right and in two counts with violating the federal conflict of interest statute.

The following is alleged in the indictment:

  • Dwane Nevins — a small business specialist at the VA’s Network Contracting Office in Colorado — agreed to take bribes offered by Robert Revis, Anthony Bueno and an undercover FBI agent to help them manipulate the process for bidding on federal contracts with the VA.
  • Revis and Bueno, working with Nevins, agreed to submit fraudulent bids from service-disabled-veteran-owned small businesses under contract with their consulting company so that federal contracts would be set aside for only those companies.  As Bueno allegedly explained, they would then “own all the dogs on the track.” 
  • Nevins, Bueno and Revis worked to conceal the nature of the bribe payments by either kicking back to Nevins a portion of the payments made to their consulting company, or by asking their consulting company’s clients to pay Nevins for sham training classes related to federal contracting.

The indictment also alleges that, after complaining about not being paid by Revis and Bueno for his participation in the scheme, Nevins used his official position at the VA to extort approximately $10,000 from an undercover FBI agent, telling the agent that “the train don’t go without me.  You know what I mean?  I’m the engine.  I’m the caboose.  I’m the engine room.”  Nevins also allegedly told the undercover FBI agent: “This is a business and businessmen need to get paid . . . . so I can have my Christmas, you know what I’m saying?”

The indictment alleges that the conspirators attempted to rig the process related to two particular contracts, both of which related to medical equipment and not to the construction of any VA facilities.  The first contract related to the procurement of LC bead particle embolization products by a VA hospital in Salt Lake City, and the second contract related to the procurement of durable medical equipment for VA facilities located throughout the region.

The case was jointly investigated by the Federal Bureau of Investigation, the U.S. Department of Veterans Affairs Office of Inspector General, and the U.S. Small Business Administration Office of Inspector General.

Readers are reminded that the defendants are presumed innocent unless and until proven guilty in a court of law.

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GAO acknowledges progress in federal acquisition by Congress and Executive branch, but says ‘challenges endure’

Congress established an Acquisition Advisory Panel to review federal acquisition laws, regulations, and policies — and identify opportunities for improvement.  The Government Accountability Office (GAO) just issued an assessment of the progress made since the Panel’s 2007 report.

Here’s what GAO found:

Congress and the executive branch have taken numerous actions to address key issues the Acquisition Advisory Panel identified in its 2007 report, but these actions have not eliminated some enduring challenges. The figure below presents the key issues the Panel addressed in relation to the life cycle of a typical contract as identified by GAO:

Three of the key issues, and the corresponding challenges, align with specific phases in the contracting life cycle:

  • Requirements Definition: The Panel found that fully identifying requirements before a contract is awarded is key to achieving the benefits of competition. GAO has found that unrealistic requirements have contributed to poor program outcomes at the Department of Defense (DoD), and that the Army’s requirements development workforce decreased by 22 percent from 2008 to 2017.
  • Competition and Pricing: The Panel said that competition can help reduce prices. GAO’s work shows that competition rates have remained steady government-wide, and declined at DOD. See figure below.

GAO also found that agencies are sometimes using bridge contracts — which GAO has generally defined as either extensions to existing contracts or new short-term, sole-source contracts — to avoid a lapse in service caused by delay of a follow-on contract award.   In some instances, bridge contract awards delay opportunities for competition and can place the government at risk of paying higher prices for multiple years.  The figure below depicts how an Army bridge contract for computer support services planned for 12 months was extended to 42 months.

Further, GAO’s work shows that agencies have not fully embraced initiatives and techniques intended to reduce the prices they pay, including consolidated purchasing approaches and robust market research.

  • Contractor Oversight: The Panel raised questions about the capacity of federal agencies to oversee contractors.  GAO found that agencies continue to award contracts warranting increased management attention at a steady rate, such as contracts for management support services. With contracts like those for management support services, there is an increased risk that contractors may perform tasks reserved for the government.  Additionally, GAO found that heavy workloads at the Department of Veterans Affairs have made it difficult for officials who oversee contractors to ensure contractors adhere to contract terms.

Three of the key issues, and the corresponding challenges, cut across all the phases of the contracting life cycle:

  • Acquisition Workforce: The Panel found that the federal acquisition workforce faces workload and training challenges. GAO’s work has shown that DoD has enhanced its workforce, but some workforce gaps endure at DoD and across agencies.
  • Federal Procurement Data: The Panel found that the government’s primary repository for acquisition data contained some unreliable data.  Also, GAO found that the system has demonstrated limitations. For example, guidance from the Office of Management Budget (OMB) required that agencies collect specific contract award data, but the system did not have the capability to do so.
  • Small Business Participation: The Panel found a number of challenges hindering agencies’ efforts to meet small business goals. GAO found small business participation has increased, but many agencies are not in full compliance with requirements governing Offices of Small and Disadvantaged Business Utilization (OSDBUs). For example, the directors of these offices should report directly to agency heads or their deputies, but not all agencies have established this type of direct reporting relationship.
What GAO Recommends

GAO did not make any new recommendations in its Sept. 12, 2018 assessment, but it has made numerous recommendations in the past.   Federal agencies have agreed with many of GAO’s recommendations, and have implemented some of them, but not others.  For example, GAO has previously made the following recommendations.

  • The Army should assess the resources needed for the requirements development process. The Army agreed, but it has not yet done so.
  • OMB should provide guidance for agencies to manage bridge contracts. OMB agreed and has drafted management guidance but has not yet finalized it.
  • Certain federal agencies should take steps to document how they conduct market research. The agencies agreed and did so.
  • The Department of Veterans Affairs should develop tools to help oversee contracts. The department agreed and did so.
  • DOD should have issued an updated acquisition workforce plan in fiscal year 2016. DOD agreed and issued the plan.
  • OMB should take steps to improve how agencies collect certain procurement data. OMB generally agreed, but has not yet addressed the recommendation.
  • Certain federal agencies should take steps to comply with OSDBU-related requirements. Most agencies that provided comments agreed or partially agreed. Two agencies — the National Aeronautics and Space Administration, and the U.S. Agency for International Development — have addressed the recommendations.

It its latest report, GAO reiterates its belief that all agencies should implement all of these recommendations.

See the GAO’s full report here: https://www.gao.gov/assets/700/694457.pdf

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To streamline acquisitions, 809 Panel presses DoD to adopt portfolio management

The congressionally-mandated panel in charge of finding ways to streamline the Defense acquisition system called last Thursday for dramatic changes in how the Defense Department organizes itself to define requirements for weapons systems and manage its procurement budgets, saying DoD must move to a “portfolio-centric” approach to procuring military equipment.

In the second volume of its report to Congress, the Section 809 Panel said the Pentagon’s current decision making and incentive structures are far too focused on individual weapons programs, not on broader portfolios of capabilities.

In a related problem, the panel said the three broader communities within DoD that are in charge of deciding what to buy, prioritizing funding for those systems, and actually conducting procurements, are too siloed to make the sorts of quick, agile decisions needed to deliver military capabilities that are relevant to the modern battlefield.

“The highly centralized management framework of each support system fosters inconsistent accountability and responsibility,” the panel wrote. “Decision-making processes that focus on individual programs instead of enterprise capabilities as a whole cultivate a system bereft of flexibility, speed, and innovation.”

Keep reading this article at: https://federalnewsradio.com/defense-main/2018/06/to-streamline-acquisitions-809-panel-presses-dod-to-adopt-porfolio-management/

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New OFPP strategy targets 13 percent reduction of duplicative contracts by 2020

The Office of Federal Procurement Policy (OFPP) has been trying to solve contract duplication for almost a decade.

OFPP required agencies to justify new multiple award contracts by submitting business cases. That had limited success.

OFPP tried to create catalogs of existing contracts so agencies could see what was out there first before going down the path of a new contract. That had even less success.

Now OFPP is trying to use category management and its subcategory best-in-class contracts to shrink the number of technology, professional services, transportation and logistics and seven other categories where the number of MACs has grown and grown for decades.

Each category manager developed new strategies for 2018 with goals across four broad areas. Without a doubt, reducing contract duplication and ensuring small businesses aren’t left behind are going to be the hardest to achieve.

Keep reading this article at: https://federalnewsradio.com/reporters-notebook-jason-miller/2018/04/new-ofpp-strategy-targets-13-percent-reduction-of-duplicative-contracts-by-2020

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