Homeland Security procurement: This is how you do it

In its recent report, the Volcker Commission suggested that personnel flexibilities granted to the Department of Homeland Security could serve as a model for reform across government. The same could be said for the department's procurement policies.

Successfully accessing, buying and applying technology-driven solutions will be essential to the department's success. There is much it should do to achieve that goal.

At the top of the list is indemnification for anti-terror technologies. A vast array of technology solutions will be at the heart of the department's mission. Many of those carry potential liabilities that vastly outstrip any commercially available insurance. Without some indemnification or liability protection beyond what's available, companies will be unable to sell needed solutions to the government.

The tort reform provisions contained in the homeland security legislation are helpful, but not enough. Moreover, repeal efforts are already under way in Congress.

A companion solution would be to make available to selected homeland security requirements the 85-804 Extraordinary Relief provisions now included on select weapons systems and other government contracts. These provisions offer reasonable liability protection, defined at the outset of the procurement, in cases where adequate insurance is not available.

As it gets under way, the department also should take advantage of the great latitude it has to determine what may be procured using the commercial buying authorities contained in Part 12 of the Federal Acquisition Regulation.

Part 12 was created to facilitate government access to commercial solutions. Congress clearly recognizes that many of the department's requirements will involve analogs to or derivatives of commercial capability, and it has given the department real flexibility to ensure it can access those capabilities.

The key now is to fully reflect those flexibilities in the department's regulations and procurement practices. There are too many recent examples of regulations being unnecessarily more restrictive than the underlying statutes, including the current regulations governing Part 12. We cannot afford to repeat that mistake.

Similarly, the department has the opportunity to become a model for rational intellectual property rules and guidelines. The government's intellectual property practices remain one of the greatest barriers to its ability to access new technology. The new department can set the pace for the rest of the government by developing clear, concise guidelines that reflect both the government's needs and the realities of the technology marketplace.

Finally, the new department must establish clear rules for the appropriate use of federally funded research and development centers, national labs and universities. To avoid wasteful spending of scarce resources, funding for these activities should be restricted to areas where there is no private-sector analog, such as basic research and truly unique studies and analyses, and prohibited in areas where there is meaningful commercial capability.

It is simply wasteful to direct funds, especially in a noncompetitive manner, for capabilities already available or under development elsewhere.

In Section 509 of the Homeland Security Act, Congress made clear that it intends for the department to rely on the competitive marketplace, where the bulk of technology research and development takes place today. The department must establish clear policies that reflect this reality as well as Congress' intent.

Building the new department is a daunting task. As its procurement foundation is laid, implementing these initial steps will help it achieve its mission and become a model well worth replicating. *

Stan Soloway is president of the Professional Services Council and a former deputy undersecretary of defense. His e-mail address is soloway@pscouncil.org.

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