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Does the government really need another $15B contract?

It’s not unusual for us to get a few comments when we have a story about a new contract that’s in the works.

But, the comments on our story about the Army ITES-3 Services contract, which could be worth up to $15 billion, gave me pause.

These comments follow the usual pattern of questioning the need for another large, multiple-award contract, but in light of budget cuts and looming sequestration, the comments resonated with me.

The request for information for ITES-3 included a questionnaire with questions that are “eerily familiar to anyone in the acquisition realm,” wrote an anonymous commenter.

The questions have been “asked 100 times before. They have been answered pretty definitively too by the existing [governmentwide contracts] Alliant, CIO-SP3 and SEWP. So, why is the Army cranking this machine up again? Who really needs it?” this person wrote.

Mike in Fairfax, Va., wrote, “This new RFI routine demonstrates just how mindlessly and automatically the services and government in general just plods ahead in spite of all external realities. Would anyone at Army dare ask do we really need this?”

Our friend, the SPMayor of Summit Point, W.Va., offered a similar view: “I wonder if [the] Army would reconsider if they were informed or able to determine by the responses that these services are available from existing contracts for the term under consideration - for example Alliant.”

M Pat of Reston, Va., also argued that the ITES-3 is redundant. GWACs are already in place that could handle the need. “Why waste federal and industry money?...How do we justify this frivolous bureaucratic exercise in excess…?”

That’s a great point, and has me wondering if, in these tight budget times, whether agencies should be required to justify a contract, even a recompete, and specifically explain why existing vehicles won’t work, particularly for a broad services contract such as ITES-3.

I know each agency feels it is special and unique, but if the government is going to get serious about cutting costs, aren’t redundant contracts as good a place as any to start?

Posted by Nick Wakeman on Feb 11, 2013 at 7:24 PM


Reader Comments

Mon, Feb 18, 2013 Madonna

Having been in the fed contracting biz for longer than I'd want to admit, I have seen vehicles come and go, and have seen the differences in dealing with one vehicle over another. Yes, some are managed better. Period. CIO-SP in all its iterations is a MUCH better vehicle, more efficient and easier to use than most others. GSA schedules on the other hand became harder and harder to use as it got bogged down under its own largess weight. So consolidation has it's woes also. That said, I am not naive and know first hand that some vehicles are geared toward certain primes. we need to consolidate based upon actual efficiency and cost-effectiveness but still allow enough vehicles for competition. How do we derive that tipping point without singling out one vehicle? ITES appears to be a scapegoat here for an overall acq issue.

Thu, Feb 14, 2013

John, all you have done is demonstrate the irrationality of how bureacrats think. How about you think like a taxpayer for a minute? How about you ask yourself how we got into this Continuing Resolution and Sequestration situation in the first place? We need to pare back unnecessary costs. If we don't need it to get the job done, why pay for it? The reality is that running the ITES (and countless other agency IDIQ's) solicitations, program offices, systems, etc, costs those agencies and the bidders a significant chunk of change. You have to understand that a large IT services provider can provide the same services to the Air Force, Navy, DHS, and Army with one or two, or three GWACs at much lower cost. It's the taxpayer, silly! Not the druthers and ambitions of career bureacrats that needs to guide the government. Oh and prices will be higher not only because of the overhead but because of the limited competition these incestuous, clubby agency IDIQ vehicles protect. What peope need to realize in government and in industry is that getting more efficient is not an option. We have deferred it too long, and now we are going to get it the hard way. It's time to get real. It's in everyone's interest if they really have a place in government or the government sector. (Oh! And not everyone does, and that's OK!)

Thu, Feb 14, 2013

Sorry John, but your logic doesn;t hold water. It costs the Army and the bidders (and especially the winners) extra money to run their IDIQ programs. This is money that goes right beack to the tax payer and/or adds to the national debt. Eradicate these and make use of cross-agency vehicles and that cost goes away. The cost is not only there where there is no fee, but it is completely unnecessary to get the work done.

Thu, Feb 14, 2013

The notion that all large primes don't want ITES-3S is dead wrong. Within these large corporations there are contituencies for all the IDIQs. It gives them make work and less competition. If you agree that more competition is good, how can you not get that IDIQs with a handful of repeat vendors can be better? The GWACs have huge vendor bases. If you don;t like Alliant SB or set-aside Schedules you might just be another SB whiner who deserves to fail because you cannot compete.

Wed, Feb 13, 2013 John Fairfax

Think like the issuing agency for a moment and the reason or the proliferation of additional IDIQ contracts becomes clear. Readers are forgetting that IDIQs have different cost structures for different agencies. Would you want to pay another Federal agency a percentage-based fee for the privilege of using their contract vehicle if you didn't have to? Probably not, so why should the Army? The numbers add up quickly when dealing with billions of dollars in expenditures, and the cost of the acquisitions so called IDIQ bureacracys is negligible compared the costs of the overall contracting infrastructure maintained by each government entity regardless of vehicle. Also note the "3" in ITES-3S. This is the third iteration of a successful IDIQ where the infrastructure is in place to manage the contract, along with the sister ITES-2H software/hardware and ITS-SB small business contracts all accessed through the Army's CHESS portal. Why limit choice? It keeps down the IDIQ loads versus driving them up. The other comments on competiton and innovation are also right on point - keeping innovative firms subservient to established primes on long-term contracts makes little sense, just adding another markup to the price the govbernment pays for services.

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