Commerce Bureau Solicits Networking Proposals

The Technology Administration, with an annual budget of $9.5 million and about 3,800 people, is the only federal agency charged with the explicit mission of working with industry to maximize technology's contribution to U.S. economic growth. It consists of three agencies: the National Institute of Standards and Technology, Office of Technology Policy, and the National Technical Information Service.

The winning contractor will be required to work on-site five days each week and provide emergency service on an "as needed" basis, according to the bureau's request for proposal.

The winner also will be responsible for choosing client hardware and software, producing custom software and database systems, creating World Wide Web materials and software programs, and training the bureau's user community.

The award is planned as a small-business set-aside, which means a concern that is independently owned and operated, not dominant in the field of operation in which it is bidding on government contracts and qualified as a small business under standard industrial classification size standards.

Joyce Hasty, staff director of the technology administration, said this effort was not an example of outsourcing since there was no one on staff who performed these functions.

She noted that the bureau did not seek to hire someone full time because there was a cap in its budget on the number of hires. Also, she admitted that no research was done on what other agencies were doing or what other Commerce bureaus had done in this area.

"We did have a small purchase agreement for this service last year that was not competitively bid since it was under $25,000," Hasty said.

"We solicited proposals to take care of this particular networking requirement for the undersecretary of technology [Mary Lowe Good] and her staff. The resources for the services came from the undersecretary's discretionary funds," she said.

According to officials at the Commerce Department, General Services Administration and General Accounting Office, no studies have been done on how widespread this practice is. Kelly Lees, a spokeswoman at the Commerce Department, said that the department neither tracks this activity nor maintains a policy on it.

Asked if other Commerce bureaus practice this type of contracting for IT, Lees said, "This is something we don't track. We don't have numbers."

On the question of whether there is a policy on such activity, she said, "This is a small RFP. This is something which is a local option. If they needed these services done, it was their decision to contract out. It is not an example of outsourcing in that there was not a position or person who was doing this for them."

Dave McClure, senior assistant director for information management and technology issues at the U.S. General Accounting Office, said that his office had "not done any studies on outside contractors being used by the federal government for IT by type of service and amounts."

In February, the GAO's Accounting and Information Management Division issued the first version of the guide, "Assessing Risks and Returns: A Guide for Evaluating Federal Agencies' IT Investment Decision-making." It's available at the GAO Web site, www.gao.gov.

Al Olson, assistant commissioner in the General Service Administration's office of acquisition, did not recall having seen any studies on this practice.

Part 37 of the Federal Acquisition Regulations on Service Contracting describes the policies and procedures for acquiring and managing services by contract, while Part 39, "Acquisition of Information Resources," covers information technology.

In Part 37.104, Personal services contracts, the FAR notes that a personal services contract is "characterized by the employer-employee relationship it creates between the government and the contractor's personnel.

The government is normally required to obtain its employees by direct hire under competitive appointment or other procedures required by the civil service laws. Obtaining personal services by contract, rather than by direct hire, circumvents those laws unless Congress has specifically authorized acquisition of the services by contract."

One person in the FAR office of GSA, who requested he not be identified, said this particular solicitation was not an example of a personal services contract.