No quick fix here

Public-private contests spur raucous Hill hearing as panel readies final advice

The Commercial Activities Panel, made up of government, industry, union and academic experts, is led by David Walker, U.S. comptroller general.

Debate about public-private job competitions is heating up on Capitol Hill as lawmakers await an independent report recommending improvements in conducting the competitions.

Government and industry officials agree the A-76 process for public-private competitions is broken, but they have urged Congress to refrain from taking any legislative action until the Commercial Activities Panel reports to Congress May 1. The panel of government, industry, union and academic experts is led by David Walker, U.S. comptroller general.

Panel participants say they hope their work will result in concrete recommendations on how to speed up the process, which is widely seen as too expensive, too lengthy and unfair to government and industry. A competition can take two to three years, according to Defense Department estimates.

It costs at least 50 percent more for private industry to compete for a job under A-76 than any other bidding process, according to Stan Soloway, a panel member and president of the Professional Services Council, an Arlington, Va.-based trade association of government professional and technical services providers.

Problems arise because government workers often don't have the training necessary to compete for their jobs, federal officials said. Industry officials argue that federal agencies can't fully account for their costs, which puts the private sector at a competitive disadvantage.

"It sounds like we don't want competition ... [but] we just think A-76 is not a level playing field," said Olga Grkavac, executive vice president of the Information Technology Association of America, Arlington, Va.

At stake are a relatively small number of government jobs that have been ruled commercial in nature and subject to the A-76 process, where government and industry bidders vie for the work. The Bush administration wants agencies to compete 5 percent of their commercial jobs this year and 10 percent by 2003.

Angela Styles, administrator of the Office of Federal Procurement Policy, said 825,000 federal jobs that are commercial in nature have never been subject to competition.

The administration's goals are laudable, but the administration has put the cart before the horse by proposing more competitions before the A-76 process is fixed, said Booth Jameson, director of global government affairs for the federal unit of Electronic Data Systems Corp. of Plano, Texas.

Rep. Joel Hefley, R-Colo., expressed similar sentiment at a March 13 hearing of the House Armed Services subcommittee on military readiness, which he chairs.

"We are receiving mixed messages from the administration and the Defense Department on this issue," he said. "DoD has testified that the A-76 program is unfair, cumbersome and broken. On the other hand, the administration, through the Office of Management and Budget, wants to move forward with more A-76 studies."

The administration's promotion of a process that it agrees is broken, combined with the perception that government jobs will be lost, has fueled contention on Capitol Hill. Federal union members packed a Senate Governmental Affairs Committee hearing March 6, vociferously supporting senators and witnesses representing their positions.

They applauded statements that opposed increasing the number of federal jobs put up for public-private competition, and audibly objected to those suggesting that government workers should not be allowed to compete for work that has already been outsourced to the private sector.

The Truthfulness, Responsibility and Accountability in Contracting Act, S. 1152, introduced in the Senate June 29, 2001, proposes to put all government work up for public-private competition, including work that has already been awarded to private-sector firms. That's only fair to the government workers who have to compete for their jobs, proponents said.

Opponents said submitting all contracts to public-private competition would grind work to a halt and fly in the face of attempts to focus government on its mission-critical activities, especially in a time of scarce financial and human resources.

"Why would you want your government work force looking for new work rather than concentrating on its mission?" Soloway asked.

Despite the small number of jobs affected, emotions run high surrounding the debate about public-private competitions, especially for the federal workers who could lose their jobs. Most have never competed for their jobs, said Michael Wynne, principal deputy undersecretary of defense for acquisition, technology and logistics.

"It's something they've never done in all their lives, and we ask them to do it, and we also tell them it affects their future. We have to find better ways of working both sides of the bids, if you will," Wynne said at the House Armed Services subcommittee hearing March 13.

Styles has testified numerous times before Congress that the competitions, called competitive sourcing by the administration, are not designed to outsource government jobs. Rather, she said, the competitions spur both government and industry bidders to come up with creative ways to do the government's work, bringing added efficiency and cost savings.

"No one in this administration cares who wins the competition. What we care about is competition and the provision of government service by those best able to do so, be that the private sector or the government itself. What we care about is cost, quality and the availability of service," Styles said March 13 at the House hearing.

However, the perception lingers that the result will be downsizing of the federal government, which has fueled the debate on Capitol Hill.

"This is not about saving money. This is about moving money and jobs to the private sector," said union executive Bobby Harnage, national president of the American Federation of Government Employees, AFL-CIO, at the Senate hearing. Styles and Harnage are members of the Commercial Activities Panel.

Some members of Congress are sympathetic to the unions.

"If we are going to mandate that 5 percent of contracts that are in-house ought to be reviewed, we ought to mandate that 5 percent of contracts that have been outsourced by competitive bid be reviewed also. And if we're not going to do that, then we are going to be back here next year and in the next several months, talking about the same issue," said Rep. Saxby Chambliss, R-Ga., at the March 13 hearing.

Efforts to limit outsourcing particularly concern IT industry executives because federal agencies often do not have the in-house resources to take on large-scale IT projects designed to improve federal operations. Agencies must outsource the work, they said.

"You're really looking to do a government transformation, and that usually means agencies are looking for skills outside the skill sets they have and they are often looking for commercial prototypes. ... That's why you would outsource it," Grkavac said.

From the standpoint of the Defense Department and other federal agencies, "there are some activities that are so commercial, it's a question of whether government should be doing it at all, like software development. The private sector is so good at it, it's difficult [for the government] to compete," said Chip Mather, a partner with Chantilly, Va., consulting firm Acquisition Solutions Inc.

Staff Writer Gail Repsher Emery can be reached at

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