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Policy Letter

POGO provides third set of recommendations and materials to the panel reviewing service contracting policies

Ms. Laura Auletta, DFO

c/o General Services Administration

1800 F Street, N.W., Room 4006

Washington, D.C. 20405

I wanted to provide additional comments and materials to the Acquisition Advisory Panel ("Panel") regarding some issues that were discussed during its November 29, 2005 meeting. First, I was surprised to learn that the Performance-Based Services Acquisition Working Group had not examined any specific performance based service acquisitions ("PBSAs") to determine how that contracting vehicle is working. Members of the working group mentioned the lack of empirical data to determine the benefits or problems with PBSA, and therefore I recommend that it look at a small sampling of PBSA at three to five agencies to better assess their value to the taxpayer. Too often we have witnessed "mission creep" or requirements modifications in the procurement of goods that cost the taxpayer more than is necessary. For example, DoD's procurement of the F/A-22 and many other defense systems are over-budget and behind schedule. Moreover, the final product cannot meet the government's needs or the original promises made by the contractor. Services may be more prone to such abuse and therefore the Panel should not wait for GAO or another government entity to fully study the issue.

The Panel is undertaking a vital mission and therefore it cannot miss out on the opportunity to examine PBSAs. POGO's fear is that, like many government panels and commissions, the working group's recommendation will be that more study and data is required. I recommend that the working group contact three to five federal agencies to examine what types of services have been acquired, the performance measure used, the number, if any, of amendments, modifications, or changes to such contracts, the financial or contracting incentives paid or awarded, the penalties established and applied, the grades given, and return business awarded through performance based acquisitions. I also recommend that the Panel talk to both government and contractor officials of the selected PBSAs to inquire about the process – the good, bad, and ugly to ensure that the Panel can objectively make findings and recommendations with regard to PBSAs.

Second, I wanted to provide some information to Mr. Tom Luedtke, the chair of the Appropriate Role of Contracting Support in Acquisition Functions Working Group (a.k.a. the "Inherently Governmental Functions Working Group"). On March 23, 2005, DoD issued an interim rule with request for comments (70 Federal Register 14572), titled "Defense Federal Acquisition Regulation Supplement; Contractor Performance of Acquisition Functions Closely Associated With Inherently Governmental Functions – DFARS 2004-D021." Comments can be found on the web at I have attached a copy of the Federal Register notice and POGO's comments for the Panel's review. Although the Inherently Governmental Functions Working Group was a late addition to the Panel, its findings and recommendations are essential because of the federal government's increased use of contractors.

Third, POGO urges the Panel to study the issue of adding transparency to the schedule and interagency contracting process. In the wake of Iraq and Katrina contracting, POGO has received multiple requests for copies of schedules and interagency contracting vehicles. The public, media, Congress, and contractors (especially small businesses) want to see the lists, the contractors on the lists, and the goods and services included on the lists. For example, most inquiries to POGO raise the question: "Who had the opportunity or was eligible to receive the contracts or work" that was steered to a certain contractor? POGO urges the Panel to recommend in its final report that the government buying schedules and interagency contracting system be fully open and accessible to the public.

Finally, I have attached a recent copy of POGO's contracting concerns and recommendations for the Panel's review.


Scott H. Amey

General Counsel

[email protected]


POGO's comments

Federal Register notice

Contracting Concerns and Recommendations