Watchdog Finds DoD Must Improve Contractor Performance Monitoring
Last week, the Department of Defense (DoD) Inspector General (IG) released a summary of a series of reports assessing how effectively the Pentagon tracks the performance of its contractors.
The DoD measures contractors’ past performance with performance assessment reports, or PARs, evaluations that provide a record—both positive and negative—of performance on a contract during a specific period of time. PARs are compiled in a database called the Contractor Performance Assessment Reporting System (CPARS) and are shared government-wide via the Past Performance Information Retrieval System (PPIRS) database.
PARs are incredibly important because without access to timely, accurate, and complete past performance information, the government risks awarding taxpayer money to non-responsible contractors, which is a violation of the law, or allowing performance deficiencies to fester. The former happened several years ago with the botched rollout of the HealthCare.gov website, a fiasco that might have been avoided had the Centers for Medicare and Medicaid Services more thoroughly researched the performance history of the contractor it put in charge of designing and testing the site. An example of the latter was recently discovered on a US Marshals Service contract to manage the Leavenworth Detention Center in Kansas. The Department of Justice IG found the Marshals Service was not entering past performance evaluations of the contractor into CPARS. As a result, safety and security problems at the maximum-security prison caused by understaffing persisted for almost a year.
The DoD IG audited 18 DoD divisions, including the main service branches—Navy, Air Force, and Army (POGO blogged about the IG’s report on the Army last year)—and the Defense Logistics Agency. The audit reviewed a total of 238 PARs on contracts worth a total of $18 billion.
The IG found the information reported in CPARS and PPIRS “was not consistently useful” because contracting officials did not always comply with requirements for evaluating contractor performance. Although the IG found DoD agencies are preparing more PARs in a timely manner than ever before (74 percent in fiscal year 2016, almost 20 percentage points higher than the previous year), more than a third of the 238 PARs were still late by an average of 73 days. The agencies seem to have a bigger problem with completeness: 84 percent of the PARs contained performance ratings, written narratives, or contract descriptions that fell short of past performance reporting requirements. For example, officials gave contractors an “exceptional” or “very good” rating for required evaluation factors without adequately explaining why the rating was justified, or sometimes even failed to provide a rating at all.
Finally, we would be remiss if we didn’t use this opportunity to reiterate our call for publicly releasing contractor past performance evaluations. Bits of past performance information occasionally turn up in judicial opinions and bid protest decisions, but the government has long resistedpublicly releasing this data on a regular basis in a centralized location. Public availability of contractor past performance records would incentivize responsible business conduct, which would protect the government’s and taxpayers’ interests in the long run.