Blum: Agencies' A-76 winning down by one-third

Agency success in winning public-private competitions for inherently commercial government positions under Office of Management and Budget Circular A-76 dropped to 60 percent in 2005 from 90 percent in 2004.

Matt Blum, associate administrator for competitive sourcing at OMB, said today that private-sector victories in some of the large competitions last year, including a 2,500-employee competition at the Federal Aviation Administration, likely contributed to the dip in the federal employee winning percentage.

OMB's Office of Federal Procurement Policy in the next two weeks will release its 2005 competitive sourcing report to Congress detailing the potential savings and number of competitions agencies held over the last year, Blum said today a breakfast sponsored by Federal Sources Inc. of McLean. Va., a market research firm.

"We want the best value for the taxpayer, so it really doesn't matter who wins," Blum said. "And historically, the win rate for federal employees has been around 50 percent to 60 percent."

In early reports, OFPP said that, since a revised Circular A-76 was released in 2003, agencies had been winning a little more than 90 percent of the competitions, which started to discourage vendors from bidding. But Lockheed Martin Corp. won the $1.9 billion FAA modernization contract and other vendors won large competitions at NASA and the Office of Personnel Management, which helped bring down the federal winning percentage.

Still, Blum added that over the past three years, federal employees still have won more than 80 percent of the more than 1,000 competitions agencies held.
Even with the employees' success, the National Treasury Employees Union president Colleen Kelley said the numbers don't represent the entire picture.

"Often, federal employees will make deep cuts in personnel and resources, sacrificing employees and funding, just to have a chance to keep the work," Kelley said. "It is NTEU's belief that if all the costs of using a private-sector company were accounted for, taxpayers could easily see that federal employees are the best value."

OFPP's upcoming report also will feature a section trying to convince lawmakers that using best value in A-76 competitions is effective. Congress said in the 2006 Defense Authorization Act that DOD could not take part in the best-value IT demonstration program. Best value is when agencies consider not just lowest cost, but what offer provides agencies with the overall best deal considering technology, terms, conditions and price.

Blum said OFPP may issue a separate report to the Hill to highlight the importance of best-value competitions under A-76.

"It is difficult to incentivize offerors when the decision is based only on lowest cost," he said. "There are certainly times when low cost is needed, but with what the FAA was trying to do?get innovative, transformational proposals?best value is needed."

The new report also will say that 80 percent of all agency competitions will be conducted through the standard competition method as opposed to the streamlined methodology, and 25 of 26 agencies have conducted competitions.

OFPP in February offered other highlights of 2005 when it released some initial data after the first quarter President's Management Agenda scorecard. It said 181 competitions were held for 10,000 full time positions last year. OMB expects to save or avoid spending $3.1 billion over next 10 years through operation consolidations, process re-engineering, realignments, better use of technology and lower contractor support costs.

Blum also said agency data on interagency contracting, another high priority for OFPP, was due today.

OFPP asked agencies to submit data on:

• The number of interagency contracts, including their scope, the rationale for their establishment and when they are to be renewed



• The number of interagency acquisitions conducted on customer agencies' behalf by another agency



• The number of agencywide contracts, their scope, the rationale for their establishment and when they are to be renewed.