Draft executive order gives industry heartburn

Thursday - 4/21/2011, 7:31am EDT

WFED's Jason Miller

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By Jason Miller
Executive Editor
Federal News Radio

Federal contractor groups are up in arms over a draft executive order that would require them to submit information about political contributions as part of their bid proposal packages.

The proposal, first reported by the Pajamas Media Tuesday, details the type of information federal contractors would have to report to agencies on the front end of the contracting process.

The draft document states agency contracting departments must require vendors to disclose certain political contributions and expenditures in the past two years before submitting a bid on a contract. The contributions include federal candidates, political parties or party committees as well as third party entities "with the intention or reasonable expectation that parties will use that money to make individual expenditures or electioneering communications."

The proposal would require vendors and their employees to report contributions that total more than $5,000 in any one given year.

The draft order also would require all of this data to be published on Data.gov in a machine readable format. Data.gov is one of the sites that is slated to close down because of a lack of funding.

"The President is committed to an overhaul of government contracting policies to promote accountability, transparency and competition," said an administration official in an e-mailed statement. "Taxpayers deserve to feel confident that federal contracting decisions are based on merit alone and are not influenced by political favoritism. That said, this document is a draft EO that is still moving through the standard review and feedback process. It is not a final document. But the President is committed to bringing more accountability and transparency to a federal contracting system that has long needed reform."

White House press secretary Jay Carney echoed the official's comments in Wednesday's press briefing. He said the draft is going through the process and could change.

Carney said the President believes that the public has a right to know how federal contractors are spending their money on political campaigns.

"And his goal is transparency and accountability. That's the responsible thing to do when you're handling taxpayer dollars," Carney said.

But contractors are worried that even though this is just a draft, there seems to be a feeling this is a done deal in the White House's eyes.

"As it now stands, it's a rather odd executive order," said Stan Soloway, president of the Professional Services Council, which is an industry association. "The President would be singling out government contractors for special and unique reporting regarding political contributions, all of which are primarily already reported through Federal Election Commission in some effort to tie contract award to potential political and contributions and break any possibility there is bias created by those contributions. But the reality is that's the last thing you want to do is politicize the process."

Soloway said contracting officers already can look at the FEC data on political contributions.

"It's irrelevant to the acquisition process," he said. "These are merit-based decisions and should remain merit based, and introducing political contributions in one direction or another could be very harmful. It's a troubling suggestion that this is a necessary suggestion to somehow protect the integrity of the process when it could do exactly the opposite."

Trey Hodgkins, senior vice president for national security and procurement policy at TechAmerica, another industry association, echoed much of Soloway's comments.

He said such requirements would add administrative burden to vendors, who would then pass the costs back to the government in overhead fees.

Hodgkins said what also worries him about the draft order is the requirement to report third party contributions.

"What does this have to do with the company's ability to get a competitive contract?" he said. "What is the purpose of collecting information and making sure it's visible and making it a part of reps and certs in the context of acquisition? Political contributions should be wholly and separate from any contract competition. What relevance contributions are to a contract is not clear and the EO makes no attempt to explain relevance."

A former political appointee who now is a contractor and who requested anonymity because their company did not give them permission to discuss the draft order, said the administration should instead "require contributions to be reported to the Federal Elections Commission, and require procurement officials to recuse themselves if they've granted enhanced access or favoritism in exchange for such contributions."

Soloway said in all his years working in the contracting community, he has rarely, if ever, seen politics in the contracting process.