GSA's new contracting policy tackles IG's concerns about management interference

Wednesday - 4/23/2014, 4:15am EDT

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The General Services Administration is attempting to clarify to managers and vendors alike the proper approach to overseeing the schedules program.

A February memo and policy is part of the way GSA's Federal Acquisition Service is trying to address a 2013 inspector general report that found examples of improper management interference on decisions by contracting officers under the schedules program.

"We've taken a number of actions to reinforce proper procurement while also focusing on doing more for our customers to save them time and money in acquisition," said Tom Sharpe, commissioner of GSA's Federal Acquisition Service, in an exclusive interview with Federal News Radio. "We've moved out on training. We've moved out on providing tools for the multiple award schedules, and we are in the process of standardizing part numbers, instilling horizontal pricing pressure. The schedules are priced vertically, the most favored customer price, so we are looking at comparison across suppliers to provide horizontal pricing pressure, and we've taken on initiatives to make the processes within the multiple award schedules faster."

In June, the GSA IG found FAS managers improperly interfered with negotiations for new schedule contracts for Carahsoft, Deloitte and Oracle. GSA executives ended up suspending one senior official in light of what the IG found and have been taking steps over the last nine months to clarify and reinforce the role of managers in schedule contract negotiations.

"To me, the role of management is to support and reinforce those contracting officers," said Sharpe, who has served as a contracting officer, a contracting officer supervisor and in several other acquisition operations positions during his career. "Contracting officers have difficult jobs and make subjective decisions, and the role of management is obviously to hire, to mentor, to supervise or to guide, to be a point of escalation to resolve issues, and quite frankly when it's on the other side when there is an issue to support and correct a contracting officer. ... I'm holding management responsible to fulfill that role, and I won't tolerate improper intervention or improper execution of that role. In fact, every executive in FAS holds in their performance plan an outcome of proper procurement and proper procurement controls in fiscal 2014."

Record and file it away

The instructional guidance requires contracting officers to document all communications with vendors, members of Congress and their staffs and any other interested party. Additionally, the contracting officer must document any discussions with managers outside of the business portfolio's business control process.

"What folks should take away from it is, the memo expressed support for the contracting officers and the very important difficult jobs they do. So I expressed my support," Sharpe said. "The second thing I would suggest be taken away from it is, there is a proper role for management, and management is accountable for proper procurement and for supporting our contracting officers. The third is how important price is, and how important getting the best price possible on behalf of our customers to save them, in this instance, money, but also time."

These documentation requirements don't address the real problems — only the symptoms, said Roger Waldron, president of the Coalition for Government Procurement.

The CGP was one of three industry associations who wrote to Sharpe last June, expressing concerns over the IG's recommendations and the steps GSA initially took to resolve the findings.

"The acquisition letter and guidance about documentation about contacts and going up the chain, doesn't from CGP's perspective address concerns raised in our letter and potential suggestions we made for how to handle situations where contractor wants to raise concerns about the negotiation process," Waldron said. "We made suggestions about having a schedules' ombudsman to handle potential problems. We suggested fixing the pricing policy. It's outdated, going back 40 years and is product based. Outdated policies make for challenges, especially when applying them to current contracts, and they create questions of interpretations among contracting officers and acquisition centers."

Waldron said the pricing policy based on the price reduction clause is the biggest problem that needs to be addressed. He said vendors do not have a way to escalate concerns to find creative solutions.

Sharpe said good procurement is always about "Why this source?" and "Why this price?" He said the horizontal pricing pressure, reverse auctions and several other things are aimed at driving the best prices possible.

IG conflict of interest?

Waldron said all the talk about price is fine as long as there is a way to solve disagreements over what is the best price.