Congress seeks insourcing through cataloging contracts

The inventories of services contracts would provide a clear picture of agencies’ reliance on the private sector and how an agency could do the work cheaper.

Civilian agencies might have to share information on their services contracts with Congress under a major spending bill that’s headed to the president. Officials said they would use the information to identify the services the government can perform rather than having contractors do the work.

The fiscal 2010 Consolidated Appropriations Act (H.R. 3288) would require agencies to create annual inventories of their service contracts. The inventories would provide a clear picture of agencies’ reliance on service contractors because without that information, “federal agencies are not well-equipped to determine whether they have the right balance of contractor and in-house resources needed to accomplish their missions,” a panel of lawmakers wrote in a report accompanying the version of the spending bill that the House and Senate passed. Congressional leaders expect President Barack Obama to sign the bill into law.

In their inventories, agencies would have to include descriptions of services performed under each contract and show how they helped the agency reach its objectives. Lawmakers also want to know how much money was obligated for the services and the total amount invoiced for services under each contract. Agencies must also include information on task and delivery orders, which is largely how agencies buy services.

To help agencies decide whether to bring work in-house, the legislation would require agencies to count the number of contractor and subcontractor employees compensated under each contract and note where the employees are located.

Lawmakers emphasized the risk of having contractors become so involved in agencies’ work that officials lose control of government operations. The legislation seeks to ensure that agencies do not let contractors perform work that only federal employees should do — called inherently governmental functions — and that officials pay close attention to outsourced jobs that are associated with those functions.

Congress also wants agencies to safeguard against contract changes or expansions that could cause contractors to cross the line into inherently governmental duties.

Congress is also interested in knowing when and what types of contracts were awarded, which contractors are performing the work, and whether the contracts were awarded competitively, according to the legislation.

The fiscal 2008 National Defense Authorization Act contained a similar requirement, and the Army has already saved $50 million by insourcing work identified through an inventory process, according to a bill summary by the House and Senate Appropriations Committees.

On Dec. 10, the House passed the conference report on the $446.8 billion spending bill for fiscal 2010, which consists of six appropriations bills, by a vote of 221-202. On Dec. 13, the Senate passed the bill 57-35.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

Reader Comments

Sun, Dec 27, 2009 Jaime Gracia Washington, DC

The interesting thing about this legislation is that, in theory, this data should be readily available. It is unimaginable that federal agencies cannot get oversight over their contracts, but that is exactly what is happening. The government simply does not know who is doing what, so I am not sure how they expect to execute on this requirement. First, the definition of inherently governmental is still relatively undefined, and managers do not know have the skills or workforce to perform these functions. This data will be difficult to gather, as the information is by and large missing, incomplete, or simply incorrect. My fear is that this will turn into a witch-hunt with knee-jerk reactions to meet deadlines and mandated cost savings without the proper due diligence and business case analysis, with subsequent cost analysis on what is truly in the best interest of the Government.

Wed, Dec 16, 2009

The article quotes the bill summary as stating "...the Army has already saved $50 million by in-sourcing work identified through an inventory process...." One of the biggest problems with A-76 studies was that it was way too easy to compare apples to oranges--not look at the entire cost basis on one of the two sides and present the results in a manner which justified the preconceived conclusion. The of late "reverse A-76" process brought about by the Administration's push to in-source has the same flaw. I would love to see the calculations that supported the $50M sound bite above, when everyone close to the problem knows that a comparable Government employee has a fully-loaded labor rate about 50% higher than a similarly-qualified Contractor. This does not even consider the intangible factor that Contractors are "expendable" (terminated at the stroke of the KO's pen), while Government employees are "forever"--clearly impacting total lifecycle cost to the entire Government.

Wed, Dec 16, 2009

Congress should say what they mean. You can read above what they said. What they actually mean is: "Executive Branch agencies over which I do not have direct control, provide me a list of all your services contracts though which you've been getting what you actually need below my radar screen so I can go after what's in my neighbor's district and protect what's in mine."

Tue, Dec 15, 2009 Jason Herndon, VA

Sounds great, they will need to hire an IT company to create and manage software and hardware for these new applications and databases and then they will need contractors to run it because the Government either doesnt have the avaialbe yet qualified people to do it, or they lack the qualified people to do it. They will take a year to determine what they need, another year for the sources sought, another year to go through the RFP, then amendments then source selection process. There will then be a protest which will add 90 days. The GAO will determine there were problems with the source selection process. The Government will spend another year. When the new award is accepted by industry then the requirements would have changed so the Government then gets what it doesnt need. They will recompete the contract after the first option year and this process starts again. Any questions?

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