Contracting officers get too friendly with contractors, senator says

Contracting officers lose objectivity because they are too friendly with companies.

Contracting officers should stick to auditors’ conclusions on contract pricing to keep the officers' perhaps impaired judgment out of the negotiations, Sen. Claire McCaskill (D-Mo.) has said.

The former state auditor from Missouri said Feb. 1 that contracting officers lose objectivity because they get too friendly with the contractors they oversee and build connections with the companies as business partners, and therefore lighten up on tough independent supervision. Auditors don’t have that relationship, which makes them stick to their impartiality in ways the contracting officer could not, she said.

“Contracting officers have an ongoing relationship with the contractors that sometimes impact their ability to see everything clearly as it relates to some of the behavior of the contractors,” said McCaskill, chairwoman of the Senate Homeland Security and Governmental Affairs Committee's Contracting Oversight Subcommittee. During a hearing, McCaskill also conceded she was biased toward auditors.


Related story:

Procurement power stays with contracting officers


McCaskill, who is also on the Armed Services Committee, said contracting officers in Iraq are examples of such problems, as many failed to be tough with contractors or even understand what was going on. She said the contracting officers there were often “the low man of the totem pole, who was handed a clipboard” and told to handle a contract.

“There’s just a fine line between cooperation and being co-opted. And the auditor always has to err on the side of not being co-opted,” she said during a hearing that looked into government auditing.

At the hearing, E. Sanderson Hoe, a partner at the McKenna Long and Aldrige law firm, said McCaskill’s view is an unfortunate depiction of what represents contracting officers’ work overall and what they do for the government.

“There are problems, there were problems, problems currently exist,” Hoe said. But that is not representative of the entire history of government contracts.

Negotiations are a part of everyday life in federal contracting, as contracting officers, auditors and the companies work out the details of contracts, Hoe said, adding that no one always gets what they want and often have to give and settle on a suitable deal.

But, he said, auditors are being granted primacy over the officers, even though the Federal Acquisition Regulation empowers them. He mentioned a Jan. 2 memo in which the Defense Contract Management Agency (DCMA) said it will take an auditor's recommendation on a contract's prices. He said it supersedes the decision making authority of the contracting officers.

McCaskill said she supported DCMA's decision to stick with the auditor.

"Their independence is not something that was front and center like with an auditor," McCaskill said about DOD contracting officers.

Reader Comments

Sat, Aug 6, 2011

NO help for the small business owner they only give the work to BIG companys. the S.B.A. needs to have all new Leadership. S.B.A. is broken and its harming our economy im for a complete overhaul there not doing a good JOB. Lets create new jobs at home.

Mon, Feb 14, 2011 retiredCOR VA

The COs are so far removed from day to day exerience that this allegation is hard to believe. The CORs (KORs) have the burden of trying to describe in RFPs and performance plans the details and outcomes expected for very complex service contracts. While the prohibition of personal services exists, the reality of faux personal service contract situation is the rule. Bottom line- the deck is stacked against the gov. COR is rarely more expert or knowledgeable than the Contractor he is expected to procure, manage, and get results from. At least in the subject matter area for which they are contracted. The complexity of the the laws, both fiscal and contracting make this whole situation a total goat rope from beginning to end. CO are totally removed from day to day operations and spread so thinly that this relationship could only be possible at an executive high above the daily operations and work day interactions between government and contractors on most contracts. Contracts services are by nature hard to supervise and measure in the more technical endeavors where they are most needed. The artifical measurement tools and performance measurements are surrogates for the real needs and expectations. The whole situation is on sad expensive joke. Congress has written stupid laws and impossible fiscal rules that waste money, time, and effort in an attempt to ensure ethics. More money is spent meeting the contracting rules than getting the technical service truely desired.

Sat, Feb 5, 2011 Jaime Gracia Washington, DC

As much as I respect and admire Sen. McCaskill's efforts to ferret out waste, fraud, and abuse in federal contracting, I could not disagree more with her premise. Firstly, Contracting Officers and industry SHOULD have a strategic partnership, as both parties are trying to execute the same goals and objectives. Of course government and industry have different means to achieve these goals, but it is through understanding each other and open communication that both parties will be successful. Communication between industry and government continues to be challenging, and advancing the agenda of building barriers and confrontation that Sen. McCaskill seems to be advocating will further exacerbate this issue. Further, it is Contracting Officers that are given the authority to negotiate and enter into contracts on behalf of the government, not auditors. I understand Sen. McCaskill’s affinity for auditors, having been one herself. However, it is this fundamental misunderstanding of not only federal regulations, but the role of Contracting Officers that hurts proper price analysis and its subsequent negotiation by undermining those with the true power. Financial analysts and Contracting Officers need to work together, in conjunction with industry, to get the best deal for the taxpayer and ensure all parties are setup for success. Adversarial relationships are neither objective nor productive, they just create friction and missed opportunities for successful outcomes.

Fri, Feb 4, 2011

Yes, true, true. But then, congress has contractors and lobbyists writing their legislation, so like, pot and kettle, eh?

Fri, Feb 4, 2011

Not so much with the KOs, but definitely at the COR level, whose judgemnt the KO seldom challenges, since they are so swamped. The relationship is downright incestuous at times. Long term contractors are used and treated like employees, so it is only natural that the daily working relationship is like with other coworkers. The simplest answer (which happened around here while the insourcing push was still on) was to just hire the contractors in place, and make actual employees out of them.

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