Have Federal Procurement Reforms Gone Too Far? A discussion on the PubKLaw-L list from 10/21/02 to 10/30/02 which began from a paper by Judge Stephen M. Daniels, Chairman of the GSBCA. Judge Daniels' paper may be found at Date: Mon, 21 Oct 2002 23:26:57 -0400 Subject: [pubklaw-l] Have Federal Procurement Reforms Gone Too Far? >From Jack Friery Below is a reprint of an article I wrote for the most recent Newsletter of the San Diego Chapter of the National Contract Management Association. The article reports on a speech by the Chairman of the General Services Administration Board of Contract Appeals, who argues that the reforms to the federal procurement system over the last ten years have distorted the system and made it more impenetrable, particularly for small businesses. "The Cassandra of Government Procurement" by Jack Friery, Esq. (The following is a synopsis of a recent speech by Judge Stephen Daniels, the Chairman of the General Services Administration Board of Contract Appeals, as part of the Office of Federal Procurement Policy Lecture Series.² Before joining the GSBCA, Judge Daniels was a staff member of the House Government Operations Committee, and a member of the Commission on Government Procurement. He had a hand in crafting the Competition in Contracting Act of 1984.) Did the federal procurement reforms of the 1990s abandon good procurement practices of the past? In the mid-eighties, the federal Competition in Contracting Act prescribed full and open competition, required publicizing procurements, created a single, unified system of procurement, and strengthened bid protest procedures. But the guts have been ripped out of CICA. Openness, fairness, and economy have been replaced by speed and ease of contracting. Full and open competition has become a slogan, not a standard. Recent procurement "reforms" have resulted in: "Empowering" agencies and personnel to use their own rules and practices. This weakens the centralized and unified federal procurement system. It also makes it harder for contractors to deal with the Government, since each agency approaches contracting differently. Undue importance being given to past performance in proposal evaluations. Some contracting officers make reputation as important as technical merit or cost. This factor is too subjective, excludes new entrants from the Government market, and tends to restrict bidders' legal rights, since contractors sometimes feel that they will be penalized for lodging protests and claims. Methods of contracting becoming distorted. Highly subjective decisions have become the norm. Oral solicitations and even oral proposals are used too frequently, and leave no record of what transpired. Agencies are limiting, in the interests of efficiency, the number of firms allowed to compete in individual procurements. Umbrella and task order contracts defeat real competition (and are inherently biased against small businesses.) Undefinitized contract vehicles, such as letter contracts, are being used to purchase major items such as buildings. And, as recent publicity proves, the misuse of Government credit cards has brought discredit on the entire Government purchasing system. Cutbacks in experienced Government contracting personnel, encouraging uncontrolled fiscal year-end spending. It also results in the relinquishing of the authority of contracting officers to program offices, and encourages political influence over procurements. These changes were claimed to make Government procurement more efficient, but have misguidedly cut back on the most important cost-saving measure-full and open competition. Increased administrative efficiency is fine. But many of the changes have been pound-foolish, and some of them not even penny-wise. By disdaining full and open competition, we have sapped the nation's greatest strength, a genuinely competitive marketplace. (Please address any comments or question to Jack Friery at mailto:friery@earthlink.net or (619) 218-7342.) Cassandra was a figure in Greek mythology beloved of Apollo, who promised her the gift of prophesy if she accepted his favors. After he gave her the gift, she rejected him. For revenge, Apollo ordained that none would believe her prophesies. She predicted the fall of Troy, her home, but was ignored, and she was murdered during the sack of the city. The full text of the speech may be accessed at http://www.pubklaw.com/papers/ofpplecture.html. Jack Friery Attorney at Law (619) 218-7342 - -- ------------------------------------------------------ Date: Tue, 22 Oct 2002 09:01:30 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? Normally I would respond to Jack Friery only. However, the synopsis Jack sent, of remarks by GSBCA's Judge Daniels, is simply too important to bury in private conversation. The increased reliance on convenient but monstrous ID/IQ procurements removes too many large expenditures and decisions from review and accountability. C.O.'s or their designees (given personnel pressures designees seem to be growing in power if not in training) can cloak arbitrary decisions behind unreviewable rationalizations. The potential for abuse is large, and adjustments need to be made. This point was driven home to me recently by a small commercial software client who participated in an R&D program w/the Navy under such a task order contract. When their technology was first discovered, it generated excitement. Upon submitting a proposal in response to an invitation, they were informed that the agency was having a hard time deciding between their technology and another proposal by one of the mega contractors with whom they were asked to team. They did team, and the C.O.'s designee instructed the commercial company to deliver up its source code. (Interestingly, the mega contractor was charged under a task with evaluating its own software and that of other companies and making a recommendation. It determined that its own software and this small client's software outperformed all others being evaluated.) When the company refused to deliver up its source code, it was told that it could be de-scoped at any time and that legitimate reasons could be provided that could not be challenged. Only their insistence on a meeting with the C.O., who confirmed that source code delivery was not required, spared them from being eliminated. The end game seemed to be to get their IP and get rid of them so that the more traditional relationship with the mega contractor could be continued with the benefit of the new technology. Later, after being told that they would be eliminated if ever they requested another meeting with the C.O., they were told that unless they prepared and performed a demonstration that would violate their 3D simulation license with Microsoft, they would find themselves without funding. One week after they pointed out the restriction in their Microsoft license and declined to do so, they received notice that they were being de-scoped and removed from the program. The rationale was that the technical direction of the program had shifted and that the Program Manager concluded that they were no longer required. Interestingly, their tasks on the ID/IQ contract are not being eliminated; they are merely being performed by the mega contact who is assured victory on the upcoming next and larger Phase of the program. While one could argue that these abuses could occur under any procurement scheme, and that one cannot regulate human behavior, my view is that the current system has gone too much in the direction of insulating decisions from cost effective challenge. I agree with Judge Daniels' remarks. Paul F. McQuade Greenberg Traurig LLP 1750 Tysons Blvd., Suite 1200 McLean, VA 22102 703-903-7533 ------------------------------ Date: Tue, 22 Oct 2002 11:54:42 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far How about a view from the "other side" (not to be confused with the Far Side -although Mr. Friery and Mr. McQuade might disagree). I for one do not agree with Judge Daniels' remarks. I do not condone the type of abusive behavior presented by Mr. Friery, but it may be a necessary cost. When we provide individuals with discretion then bad decisions become the unfortunate cost of allowing the opportunity to make good (and hopefully great) decisions. The main problem I have with Judge Daniels remarks is that he appears to view the Federal Government procurement system in the same way I view the criminal justice system. Even though it has been tested by current events and changing perceptions as my children age, I still believe in placing greater importance on the rules than on the results. So yes I still believe (though it is getting more difficult to do so) in allowing an individual who we all think is guilty to go free because they were denied a fair trial as a result of a technical violation of the rules. The system is the greater goal. But I do not think that way when it comes to Federal Government procurement. I concur with Mr. Friery's statement that our nations greatest strength is our marketplace. The question is, what discretion are we going to allow Government officials to exercise when they try to tap into that marketplace to buy what they need to accomplish their mission. I agree that by loosening the rules based system approach preferred by Judge Daniels then the "highly subjective decisions" feared by Mr. Friery may in fact become the norm. But I endorse this change and concur with placing much greater emphasis on past performance, using the same highly subjective reasoning that business and individuals use to make decisions. The question is one of discretion and accountability. Instead of being constrained by and accountable to a procurement system modeled after our criminal justice system, I prefer an environment in which Government officials are accountable for their performance within their department, and to the President and the Congress. Yes, if we actually allow Government officials to make decisions this will mean that some will be bad. But might be great. I for one am willing to accept the former in the belief that only by doing so can we expect that we have a chance to achieve the almost impossible (i.e. the missions we have established for our Federal Government). Bill Stark Government Attorney [Judge Daniels' remarks are at: ] - -- ------------------------------ Date: Tue, 22 Oct 2002 13:41:48 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? With all due respect, the situation below illustrates a very different problem than Federal Acquisition Reforms of the past decade. This particular situation is more indicative of the culture within the acquisition community (to include PM/PEO) and the difficulty CO/KOs have with their 'designees.' In the instant case, the designee had no authority to tell the contractor to provide source code - regardless of whether the contractor was a prime, sub, or 'team.' If any area needs reform, it is in the contract administration area (neglected during acq. reform) and the responsibilities of the COTR - from training to mindset (culture). Re: the synopsis of Judge Daniels' speech. Reforms are aimed at alleviating burdensome and restrictive regulatory/statutory requirements. They were not aimed at circumventing underlying legal principles or to promote expediency. Judge Daniels is correct only in that government 'business' cannot totally mirror the private sector due to social/economic statutory programs. Whether we operate 'effectively & efficiently' within our set boundaries; however, is another matter. To say categorically that "openness, fairness, economy, and accountability have been replaced as guiding principles by speed and ease of contracting," and allude that procurement officials have neglected their duty to the taxpayer, is a gross overstatement and insult to procurement officials. Contracting has become more creative but it is not a distortion with total disregard of laws and regulations. Organizations were not empowered to 'use their own rules' - they were afforded the discretion to make sound business decisions within their limits - which includes discretion in utilizing past performance. The FAR, a 'uniform set of rules,' has very little 'thou shalt not' and has always allowed for flexibility - even before acquisition reform. The FAR, like many laws, are deliberately left open to interpretation to allow for growth and flexibility. Further, cutbacks in experienced personnel is a very different matter and is not an adequate measure of whether acquisition reforms have gone to far. On the contrary, that is reflective of budget cuts, inadequate training, loss of experienced personnel/management, and inexperienced personnel thrust into areas of responsibility too soon. That is not to say that we are not to police ourselves - we have and continue to work diligently in creating the most qualified core of contracting officials with internal oversight and accountability. However, procurement officials cannot control the continual cutbacks in contracting staff. Over objections of procurement officials, procurements continue to exponentially increase while the number of contracting staff responsible continues to decrease. It will be very interesting to revisit this topic after the 'third wave' of outsourcing. Bottom line: No rules, regulations, or laws will stop those who do not already have a sense of fairness, duty, responsibility, and most importantly, accountability. Both good and bad decisions will be made; however, it will not be because reforms have gone too far. These comments are the undersigned's and do not necessarily represent those of DoD or the Army. E. Smith Army Procurement Official ---------------------------------------------------------- Date: Tue, 22 Oct 2002 17:04:16 -0400 From: Jerry Walz Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? Based on my 45 years of practice, in government and in industry, much of it in this area of specialty, I have the answer to this question: "No, not far enough." Abusive and illegal behavior is not the issue. It happens. And those of us old enough to remember are aware that it happened frequently under the ancienne regime. It is not necessary or appropriate to change systems because they are sometimes violated. Should we reduce the speed limit from 45 MPH to 25 MPH because a driver hurts himself or others while driving 75 MPH? The unreformed federal procurement system of the late 20th century was extraordinarily rule bound. Such a proliferation of rules cannot possibly satisfy the many demands of policy, efficiency and assorted other issues with which the public purchasing system is necessesarily burdened. The best this kind of command/control system can do is to provide a forest of conflicting rules which can be selectively relied upon by parties to transactions to justify whatever they think they need to do. Unfortunately, this forest provides ample shelter for abusive and incompetent activities. In A Man for All Seasons, Sir Thomas observed [albeit in a more positive vein] that when the rules are all cut down, there will be no place to hide. I can appreciate that those who work toward the passage of legislation are reluctant to see problems which may be caused by it. Former Senators Bayh and Dole recently displayed this behavior when they wrote the newspaper to complain about efforts to change their famous (notorious?) intellectual property statute. Mr. Bayh has provided me personally with a somewhat more extensive and less temporate statement of his views on this subject, but I found it equally unimpressive. Thus, I am not surprised that anyone claiming to have helped to pass CICA would still think that it has some merit. However, the facts to do not support this view. CICA did not materially increase the incidence of competition in federal purchasing. But without any question at all, it greatly increased the administrative burden. Some years ago when I was still in the government and assigned in Washington, I worked under the supervision of a leader who taught "creating administration is the cardinal sin". So perhaps my views on the subject are a little extreme. However, it is equally extreme to view increased administration as a good thing. When CICA was passed I was serving as SJA of the Air Force Logistics Command, where thousands of buyers issued some 900,000 procurement actions annually in support of worldwide air force operations. Prior to the politicization of issues concerning contract pricing and administration, AFLC was, I believe, serving the public interest quite well. More than 75% of the administrative effort was devoted to some 25% of contractual actions which, due to their dollar amount or other factors, were identified as high risk. The remaining 25% of resources worked on the relatively routine other 75% of purchases. Because of political pressures, generated principally by knowing misrepresentations of the facts by elected officials*, unhelpful statutes were passed and additional controls were instituted internally within DoD. Against all business logic, the goal became transactional perfection, no matter how insignificant the purchase. [*details available at the bar if you buy the beer.] Immediate impacts in the government were disastrous. Within AFLC alone, the increased administrative burden required the unplanned expansion of procurement manpower by 900 buyers! This huge number of new employees was recruited and put through 6 months of emergency training to learn improved systems of checking checkers. Then they were unleashed to slow down the procurement process and see that it was perfectly administered according to the forest of rules then in effect. An enormous and permanent structural cost had been added to government operations overnight. [Is that a cheer I hear from the lawyers?] Procurement lead time is money. AFLC had prided itself on continuous improvement in reduction of procurement lead time, which was valued at many tens of millions of dollars per day. After CICA, procurement lead time in AFLC alone increased overmight to 54 days. 30 days of that was a statutory publication requirement simply to delay the work for 30 days! New administrative requirements added significant time and cost to the taxpayers in every purchase which has been made since that date. My personal favorite example is the ruling of the Secretary of the Air Force which required us to reprint a bid set after the first 700 (seven hundred!) copies had been distributed to the bidder's list and other requestors, because CICA now required that we honor all such requests. I believe it should be OK to submit to the contracting officer's judgement issues such as the incremental value of having 701 competitors rather than 700. Reforms which reduce the administrative burden of dealing with the government have been advocated with the argument that companies which refrain from dealing with the government are needed in the bidders pool, in order to insure government access to the best technology at the lowest price. My own experience in industry strongly supports the validity of this argument*. Clearly, the small business in Jack Freirey's example (Hi, Jack!) whose efforts to participate in a government program apparently ran aground on a prime contractor's efforts to acquire its I.P. could be discouraged under "reformed" procedures as well. However, I submit there isn't anything in Jack's example that is being attributed to "mega company" which is not required by policy/regulation/statute in the case of the government and perpetrated by contracting officers under the authority of the FAR every day. Isn't the prime just passing it on down? And what would prevent megacompany from achieving its goals under the un-reformed procurement methods? Some of the most important reforms are directed at the issue of allowing innovative commercial companies to deal with the government and its prime contractors without risking their I.P. If we can't find a way to do this, they simply will not come to the party, nor should they. Every government contract can be cancelled for "convenience" and, of course, for fraud. Thus, there is no argument to be made that it is inflexibly necessary to prevent bad procurements. Administrative perfection is costly, and competes directly with the soldier's need for pay, medical care, retirement benefits, housing, equipment and training. I know where I place it on that priority list. If you are still reading this, I apologize for taking so much time. But this issue is my hotbutton. I was answering Congressional complaints in the 1960's as to why the procurement system had to be so complicated that a bidder needed a lawyer. And for another 30 years it just got worse. Reform is essential. Whether it is also "good", "sufficient", "etc" will be determined by the skills of the reformers and their drafters. If they get everything right, it would be a miracle. No one expects that. But returning to the state of the art which should never have been reached is not an option. And stopping before the job is finished is not a good option. And anyone who is saying "it never was broke" is not credible. Norm Thorpe Brig. Gen. USAF (Retired) ------------------------------ Date: Tue, 22 Oct 2002 17:50:10 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? This is probably going to get me into big trouble, but retirement is only months away anyhow. I am a SBA Procurement Center Representative. I was also a project engineer and program manager in a major systems program office where I fought and dodged the procurement system with great vigor. I think I can see both sides of this issue. I was trained by the AF in logistic style build-to-print type procurement as well as in large system engineering and development. But at heart, I am just an old style Industrial Engineer who believes "optimization of the whole system" has the greatest merit. In contrast, sub-optimization of the system is considered by us old guys to be evil. (Optimization is when you balance all competing goals to maximize the outcome/output of the system and with some level of confidence. Suboptimization is when you artificially overweight one goal at the expense of others, a favorite alternative approach of government) Judge Daniels is technically correct on many issues but there is a lot more to this than he addresses. You simply can not have a system that can't respond to the customer's needs either. It violates the whole purpose and everyone loses eventually. I don't think he adequately addressed the real world of having to balance the real world against the legal world. But he is absolutely correct in leading us into a re-evaluation because damage to the system has been severe in some cases. Hats off to him! In my view, the procurement system was seriously ill before the reforms, hamstrung by procedure, rules, and various constraints and unnecessary overhead. I don't think this was even seriously questioned. The proof of this fact was the customer could not get what he needed when he needed it and sometimes was even forced to use products and services that were defective. But the seller was well protected by reams of laws and lawyers ultimately at taxpayer expense. Even the small business program which I believe is absolutely essential to stimulating and maintaining our industrial base and competitiveness was mis-applied and sometimes abused...remember the $100M+ 8(a) source-source awards to unqualified firms? The small business program is now even more complex than before the reforms and streamlining, but that is another issue. Did we fix anything? Yes, we made it easy. You can do almost anything you want now. At the same time, we may have destroyed the fairness and integrity of the system, something I believe we may have actually overdone under the old system. But I am certain of one thing: we have just about locked out really good small businesses that I believe could have made important contributions. Many of our good manufacturing and engineering firms are now subcontractors to their competition. Not good! Did we just take it too far? Probably. Credit Cards: Believe it or not, I think it was a good idea but poorly executed. We do not need mounds of paperwork and an army of legal and procurement people to buy purchases under $2500. If branch level organizations with credit cards are budgeted correctly and made responsible for their budgets, we could save a lot of money and time with this approach. My current problem is that small firms simply can't find their customer and the customer only knows the big names. But why does everybody need a credit card? IDIQ: Love IDIQ. IDIQs can be quite efficient. But why did we have to make them so large as to cause even industry to consolidate? Why do they cover unrelated requirements? Why are they often written to take all technical responsibility away from the government? Why is there a competition between agencies to see who can have the biggest IDIQ? (We encountered one agency, one with almost no remaining mission, hire five very large contractors on an interagency IDIQ so they could tax other agencies...it was the only way they could save their jobs. Another good example, the AF FAST contract(s) very nearly consolidated the entire aerospace industry.) I think our error was just letting these IDIQs get bigger than we are. Omnibus Contracts: IDIQ contracts that include all mission needs. Dangerous. The contractor becomes the government. Only the contractor has corporate knowledge. Government gets so dependent they can't allow further competition for fear of serious breaks in continuity. Anyone who has seen one of these monsters up close knows the danger. Result: In some cases we have reached the point where there is almost no one inside the government activity that even understands the mission needs in technical detail. So how will they write the next requirement, write the next source-selection criteria, judge the next proposal, judge the quality of the work? The answer is they will not have a clue. At some point it will not matter if the contractor performs adequately because there will be no competent judge of the work. (If no one is around to hear the tree fall, does it even make a sound?) A few of the gray-beards remember the requirements but they are leaving. I think we have really screwed up here. Needs rethinking/revision. Total Package System Procurement(TSPR): For those of you that did not know, we even gave a big chunk of IV&V to some system houses (to save money). It is an obvious conflict of interest and is bound to cause problems. And, we don't really buy reprocurement data anymore. The systems houses are contracted to support the system for life so forget spares procurement (that is where the small manufacturers take a hit). Some complex systems may require TSPR due to the high expense of internal government (technical) capability but what happens when the system gets old and the contractor does not want to support it? We probably went too far on this one too and have no government leverage remaining. GSA: Biggest mistake of our time. GSA should stay with buying office supplies. They are outside their charter and purpose. We are now doing serious weapon systems work under GSA task orders with few controls and little competition. But GSA is a great way to bypass all current law for contracts. I have cases where the customer paid two to three time the cost just for the convenience of GSA and a comfortable name, cases where a good competitive alternate source was even working in a nearby building. We need to reform the reforms me thinks. We are no where near optimum or even a fair balance. Jim Rollins SBA PCR james.rollins@eglin.af.mil - ------------------------------------------------------------------------- As G.K. Chesterton famously observed, "Anything worth doing is worth doing poorly." Ditto federal procurement. J. William Eshelman Attorney at Law Wickwire Gavin, P.C. ---------------------------------------------------- Date: Wed, 23 Oct 2002 22:26:00 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? I must agree with the observations of General Thorpe. Moreover, in procurement law, as in so many areas of human endeavor, we tend to move in pendulum fashion, from one extreme to another. The "reforms" brought to us by CICA were a clear example of one of these extremes -- with the expanded ADP/telecommunications protest jurisdiction of the GSBCA being the most extreme of all. Judge Daniels helped create this Alice-in-Wonderland forum (both in his staff role on the Hill, and then as a GSBCA judge) which stood less for Full and Open Competition than for Full and Open Litigation. In no small part, GSBCA's excesses led to Clinger-Cohen (eliminating this protest jurisdiction) and the realization that the procurement system was becoming little more than an opportunity for a few to profit from their ability to play the system. Lost was the notion that the primary purpose of the procurement system is to quickly and cheaply acquire goods and services for the Government. So, in my view, reforms have not gone too far. This is not to suggest that abuses do not occur, and should not be corrected. However, we have not devised the system (nor, do I believe that we ever could) which eliminates abuse. Bill Murphy William.Murphy@do.treas.gov (my views alone, not representative of any organization) - ------------------------------------- Jim Rollins, thanks for your objective insights -- I found them to be very helpful and I think you make a positive contribution to this debate. pmcmahon@bbmtlaw.com - ----------------------------------------- The two critics of Judge Daniels' speech tend to dwell on the burdens of procurement officials, and the great respect they are to be afforded. Having been in this business longer than most(22 years) perhaps I might permitted a few observations. I go back to pre-CICA days. Prior to CICA,we had no effective bidding process in the Federal Government. Many, and perhaps most, contracts were awarded on a sole source basis[in 1980 I was told 85%]. There was no effective way to protest. Contracting officers and specialists often(usually?) had no education beyond high school, and did not understand the regulations they were supposed to enforce. With CICA came the first attempts to compete most contracts. Quotas were set for the agency I worked for, and we gradually got up to 30% and then to 70%, by 1987. To accomplish this was like pulling teeth, and required the installation of a competition advocate in each agency. But eventually the job got mostly accomplished. With CICA came the GSBCA's oversight of all computer procurements in the executive branch. The GSBCA created a somewhat rigid oversight--But it ended IBM's virtual monopoly over IT purchases and put a real stop to sweetheart deals. Since early 90's various inroads have been made. These inroads have speeded up the procurement process. But speed is not enough. What I believe Judge Daniels is saying is that without rigorous oversight the agencies cannot be trusted to do the right thing. I know this will offend many in the procurement community, but he's right. We can't. The plea for understanding and discretion is a siren call which is a mistake to heed. Again I refer to my previous experience when I call to mind to a well-known Pentagon agency which my organization was doing the buying for, and which was sole sourcing all of its contracts. When we told them we could not do that any more they formed their own procurement shop. It is the taxpayer's money-not the agencies. We forget that. Hugh Long LongC@pentagon.af.mil P.S. I am glad that the Clause was the first publication(I think) of Judge Daniels' article in hard copy form. ------------------------------------------------------ Date: Thu, 24 Oct 2002 11:38:18 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? Hugh Long's comments are outstanding and say it all. Anyone who works on the government side must concede how on target his comments really are. My personal opinion is that the fundamental problem with federal procurement is the relatively low levels of expertise in contracting officers and contract specialists. They are good at cookie cutter efforts, such as re-using last year's solicitation. When it comes to independent thinking and the exercise of discretion, the performance drops dramatically. Reviewers such as attorneys cannot do it all. Pressure from customers, who often treat contracting officers as their clerks, is another unacknowledged problem. The constant tinkering with the procurement statutes and regulations is a major detriment to the system. All we are doing is just creating more grounds for protest -- as the saying goes, "The more things change, the more things stay the same." A good example here is the rules on bundling. A future candidate for fertile protest grounds are the "reforms" of Section 803 of Public Law 107-107, which "fixes" the task order problems in the DOD. Yet another problem is the frequent injection of socio-economic policies into our procurement system which generally have little to do with mission accomplishment, and in fact sometimes impede mission execution. Our federal procurement statutes and regulations are way too complex - -- just check out the three inches of the FAR soft cover volume, which is single spaced. The federal government could learn much from state procurement systems. For example, in Tennessee, the statutes and regulations are minimal in comparison with the Federal government. The standards are more difficult for prevailing in protests. I doubt any state procurement system will ever go to the lengths of the FAR. Unfortunately, the FAR and the current statutory system is likely too deeply entrenched for serious overhauling -- but one can always hope! Steven.W.Feldman@hnd01.usace.army.mil - -- ------------------------------ Date: Thu, 24 Oct 2002 15:25:34 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? I agree. The most obvious conclusion is to increase the professionalism of the contracting officers. On one hand, we demand tremendous knowledge from them and on the other hand, they are precluded by ethics regs, among others, from many financial holdings available to most other Government employees. I believe that we are long overdue for a long look at the contracting officer position, with an eye toward creating a separate professional classification and attendant pay bands. As attorneys, we command respect (mostly), but contracting officers do not have their "profession" to fall back on. The public has the right to demand that COs are competent in both their knowledge of the regulations AND the products they are purchasing. If they cannot handle the responsibilities, they should not be granted authority for "unlimited" amounts from the public fisc. However, if they are competent and knowledgeable, they should be treated, and compensated, accordingly. Arthur I. Rettinger ARTHUR.I.RETTINGER@CUSTOMS.TREAS.GOV Comments are personal and should not be attributable to my agency. -------------------------------------- Date: Thu, 24 Oct 2002 20:51:51 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? As a former contracting officer and HCO, who's served in four different agencies, and had his warrant retired since he's moved on to other things, I agree with some of what has been said for the need for 'professionalism' in the contracting ranks. In fact many agencies have been taking positive steps to increase training and experience requirements for some time. Nonetheless, I do know there are many high performing contract specialists and contracting officers throughout government. What seems to distinguish the 'best' is the willingness to take risks, thorough knowledge of both the letter and spirit of the laws and regulations, a solid understanding of their agency's msision, good business knowledge and judgement, and a 'corporate culture' that encourages innovation. The 'best' contracting officers and contract specialists do not abdicate their responsibilities to their numerous advisors (auditors, technical experts, legal counsel, etc) but carefully consider their input, question their conclusions, and independently review source data as needed to be confident of making sound (and fair) business decisions. Unfortunately, many otherwise competent contracting officers and contract specialists are severely limited in their ability to become the best because their agency policies and procedures effectively mandate that they kowtow to opinions expressed by auditors, lawyers, and procurement 'policy' experts. Of course, this is very similar to the afflictions suffered by many federal supervisors and managers who received increased flexibilities for personnel management during approximately the same time frame as 'procurement reform' was occurring. How much is real and how much is illusion, is a matter of perception. Advisors, particularly legal advisors, can help improve the results by reminding their clients that they are offering advice and that the decision maker remains responsible for the outcome. No amount of training, reclassification, or 'professional designation' will solve the problem unless agency CO's are ready, willing, and able to make the necessary decisions. Agency 'culture' is a much a factor here as the individuals themselves. Robert Henderson ----------------------------------------- Date: Fri, 25 Oct 2002 10:09:55 -0400 Subject: [pubklaw-l] Re:Have Federal Procurement Reforms Gone Too Far? I agree with Mr. Rettinger's comment. Key is fixing the Civil Service classification system. "We" have raised the bar, demanded BS degrees (with Business credits) to get in, Masters degrees to get promoted but "we" still classify and pay contracting officers based on a pre-WWII classification system designed for a largely clerical workforce. Tony Lander, HQ Air Force Space Command anthony.lander@peterson.af.mil Comments are personal and should not be attributable to my agency. - ------------------------------------------------------------ I started reading this string of emails last night and started a response. After reading Mr Henderson's assessment. I'm not sure I could say it any better. I started with the Air Force 1985. I have been in three different agencies. I have seen dramatic improvements in the Acquisition regulations over the past few years, for the most part good (except maybe for raising the requirement for a Certificate of Current Cost or Pricing from $500k to $550K. What was the point?) FAR supplements are much thinner now. Which is a very good thing. And I'm all for improving the professionalism of the 1102 series. Wasn't DAIWA supposed to do that? I have worked with many knowledgeable, competent, and conscientious Contracting Officers and Specialist. However, it takes more than that to be a good Contracting Officer. It takes integrity and character. It takes someone with the insight to be flexible when necessary and the fortitude to be unbendable when necessary. It takes a management structure that sanctions and encourages creativity. And above all recognizes that the Contracting community is integral part of the Agencies mission. I think DoD has done a very good job at improving the professionalism of it's Acquisition work force. I think many of the Civilian Agencies still have a ways to go. Just as in any profession we have those that are incompetent. We have all run across them in our careers (I'm sure some think I am). But I wonder how many of you have actually seen a warrant removed because a person was incompetent? Sadly, I haven't. We can establish a whole new series for Contracting Officers. You can pay us more (I'm all for that), but that's not going to improve professionalism. Autonomy might be good, but then some would forget we are here to support our customer. If you don't have managers who are willing to remove warrants when necessary not much will change but the GS series. Knowledge, business judgement, mediation skills, diplomacy (I lack this one), tact (this one too), risk taking, interpreting, creativity are all essential qualities of a good contracting officers. However, in my opinion, the most important quality that characterizes a good Contracting Officer is common sense and how to apply it in world of regulations. Pamela K Bible Contracting Officer Department of Justice, Civil Division Chief, Contracts and Procurement Branch Pamela.Bible@usdoj.gov - -- --------------------------------------------------- Date: Fri, 25 Oct 2002 15:04:48 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? Maintaining the status quo is not good enough. Indeed, the status quo is already changing. There is the added problem that those contracts personnel in the government who are experienced and do know government contracts are retiring or getting ready to retire -- the baby boom generation. To improve matters there needs to be much more practical training to bring those that remain in government up to speed. I think the ABA Procurement Law Institute in Annapolis last year was a good start. There the ABA PCL partnered with NCMA and a number of members of NCMA attended. But simply attending a day or two of talk is probably not enough. The president of the NCMA spoke about going forward with certification procedures and programs to provide training and education to improve the level of expertise of contract specialists and contracting officers. This is a voluntary program. However, if Government contracts personnel are made to attend/become certified by their agencies, this could make a big difference. Also, if the training provided translates into practical training on real life types of problems like the PCL's hands on, week long seminars on trial advocacy before the BCAs and COFC, this would be great. I hope this gets accomplished and that the Government sends personnel for this type of training. We can't hope to make the laws less complex in the near term, but we can hope that the Government will provide its contracts personnel the skills and opportunities to learn what they need to know. Susan Ebner ebnerfam@comcast.net - ------------------------------------------------- The views both pro and con Judge Daniels' comments on procurement reforms have all been very interesting and some even controversial. The central question, for supporters and detractors, is "how many votes does Judge Daniels' have in Congress to restore a very expensive and time-consuming process in an era of disappearing surpluses, certain war, and economic sluggishness?" My take on it is that the overwrought protest litigation before the GSBCA was a wasteful luxury we could afford in the booming late eighties and nineties, even if we shouldn't have wanted to afford it, but which we can no longer tolerate. Corlyss Drinkard Senior Attorney Cdrinkar@hq.nasa.gov NASA - --------------------------------------------------------- From the contractor's side of the fence, I can say that my responsibility has grown to include greater fluency in the regulations, contracting procedures and the ins and outs of all the procurement programs. When we lost a multimillion dollar award due to the haphazard work of the contracting folks, I began to review solicitations closer, question inconsistencies (no matter how minor) and maintain awareness of regulation and program changes. My vigilance, in a way, has helped the CO's do their job better. I've accepted this environment as another risk area that we strategize for. I've been doing this since 1987 and the complexity continues to grow. No, it's not easy for small firms, especially when you are a marketing department of 1, but the federal government is our primary client and successful firm's adapt to the reality of their marketplaces. Or they go elsewhere. Elizabeth Cabral, VP Marketing SEA PAC Engineering GoBusiness@aol.com - -- ------------------------------ Date: Fri, 25 Oct 2002 17:18:00 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? Susan Ebner makes the best, and least discussed, point. In many agencies, including my own, the average age is about 50 years old. The Civil Service retirement system encourages Federal employees to leave at about age 55. We have already had large numbers of employees retire in my agency, and I don't see any serious response to this brain drain. This is not limited to Procurement folks, but many of the others retiring from the agency are being replaced by contracting out their positions. Unless we wholesale Contracting by contracting it out, there might not be enough people around to do the job as well as it is currently being done -- much less go back to the days of GSBCA protests. In short -- this might be the Golden Age for government contracting that we will look back upon fondly in future years. Craig Hodge HODGEC@hqamc-exchg.army.mil - ----------------------------------------------- I cannot leave this alone. It's a GREAT dialog. The status quo is not good enough, and I submit to you, while on a similar but slightly different tact, that the system (training and regulation) we are living with ignores the reality of Digital Media, Digital Contracts, and the workforce is woefully ill-equipped with the right regulatory tools to do the job of a Procurement Official in the digital domain. Notwithstanding the fact that the workforce is experiencing a fusion of contracts and technology which is having an effect on the level of preparedness we need for sustained readiness, especially as we possibly prepare for another conflict. I have worked with the DoD Procurement workforce at Navy, Army, and Air Force, helping implement the Standard Procurement System (SPS), so I have seen across-the-board systemic problems as alluded to below. Because the SPS enforces a set of standards, and because it does have some "policing" functions, (loved by management and loathed by practitioners) I have seen agencies try to adapt to the use of the system with varying, sometimes problematic results. Why? Because enforcement of standards, down to and including the clauses, the use of competition, and the decisions as to how to structure contracts, is inconsistent or non-existent. The aging demographic of the workforce, coupled with herky-jerky advances in technology, add to the training and readiness problem. If we expect enforceable, high quality risk apportionment in our contracting regime, we need to grapple with the training, the technology, and the enforcement of standards as a way to tackle part of the problem. We clearly are only scratching at the surface. We also need to consider authorship and adoption of an Electronic Federal Acquisition Supplement (EFARS) to provide tools adapted for the digital contracting domain (such as repudiation of digital media content, and canonical standards for interoperability between contracting systems). The staus quo will not suffice for the needs of the aging demographic and the emerging world of Digital Contracts. Chris Webster WebsterCw@cox.net ------------------------------ Date: Fri, 25 Oct 2002 21:18:41 -0400 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? [Looks like Bob has the last word for the week, particularly since he's in Seattle, unless Lis Young in Singapore decides to jump in.-JAW} Okay, I can't let this go, either. Any federal manager who didn't recognize the anticipated brain drain five to ten years ago and/or didn't begin planning for it has been asleep at the switch! (Some of us actually started taking action in limited ways years ago) Although 'normal' OPM procedures (ACWA) for hiring new contract specialists (or any professional 'administrative' position for that matter) are time consuming, impractical, insulting, and ineffective, a number of the special authorities can be used to hire students, outstanding scholars, PMI's, and upwardly mobile technicians (hint, take a look at those lower graded positions that have the most turn over and hire individuals with an eye towards future needs in professional positions). And guess what, there probably is still time to begin hiring more recent college graduates now and begin developing the next group of managers both from these ranks and others already on board. Unfortunately, many supervisors and managers will continue to only hire those that are experienced (usually older...) status employees and not provide the training/development opportunities for journey level staff because they think they are too understaffed, underfunded, overworked, or don't have the necessary FTE ceiling to do otherwise... (197 vacancy announcements on OPM web page for GS1102s, only 52 open to non status employees, only 21 entry level positions for nonstatus) ...... Time to bite the bullet, folks.. succession planning and workforce development isn't something we should only think about once every 30 years. Of course, it would be nice if OPM could come up with some reasonable methods for smaller offices to recruit and hire recent college graduates for any of the administrative positions so they don't have to wait for their agencies to implement meaningful intern programs. here's an another idea, how about an OMB exception to FTE ceilings for anyone in a SCEP, PMI, or other authorized training program. My guess... I'll be retired before either of these happen. The views expressed herein are my own and do not necessary represent the views of my agency or any reasonable or rationale person. Robert Henderson" --------------------------------------------- Date: Mon, 28 Oct 2002 11:22:14 -0500 Subject: [pubklaw-l] Re: have Federal Procurement Reforms Gone Too Far? (This touched a hot button and I couldn't resist responding!) I've been waiting for someone to say it out loud. "...This is not limited to Procurement folks, but many of the others retiring from the agency are being replaced by contracting out their positions. Unless we wholesale Contracting by contracting it out, there might not be enough people around to do the job as well as it is currently being done..." If procurement is NOT an inherently governmental activity -- what is? In a recent mandatory contracting class, some classmates mentioned that, due to personnel shortages, their agencies were hiring "some" contractor personnel to "assist" in purchasing and other procurement activities. When will we cross the line? Or, have we already? Can we really have contractor personnel negotiating contract actions? Serving on source selection boards? Would a PARC really warrant a contractor employee as a Contracting Officer? (I hope not.) But if we determine it's OK to have contractors perform "support" services, where do our government employee Contracting Officers get the hands-on experience necessary to become qualified and experienced PCO's? I know there are pro-privatization advocates who would argue that procurement is a commercial activity. Of course it is. All organizations, public, private, non-profit, etc., must procure any goods and services they cannot, or choose not to, produce with their own in-house resources. But as public servants, we must always be answerable to our Agency Head, The Congress, and ultimately, the taxpayer. If I were to stop working for the government, and hired on with a private contractor to continue performing the same mission, to whom would I owe my allegiance? Who would administer a contract to perform contracting? And who would keep them honest? Another contractor? A Contract Specialist [I normally sign anything I submit. But, in order to respect the classroom non-attribution policy, please do not use my name or e-mail address.] --------------------------------- Date: Mon, 28 Oct 2002 18:52:00 -0500 Subject: [pubklaw-l] Re:Have Federal Procurement Reforms gone Too Far? I cannot leave this alone. It's a GREAT dialog so here are a few more thoughts: The status quo is not good enough, and I submit to you, while on a similar but slightly different tact, that the system (training and regulation) we are living with ignores the reality of Digital Media, Digital Contracts, and the workforce is woefully ill-equipped with the right regulatory tools to do the job of a Procurement Official in the digital domain. Notwithstanding the fact that the workforce is experiencing a fusion of contracts and technology which is having an effect on the level of preparedness we need for sustained readiness, especially as we possibly prepare for another conflict. I have worked with the DoD Procurement workforce at Navy, Army, and Air Force, helping implement the Standard Procurement System (SPS), so I have seen across-the-board systemic problems as alluded to below. Because the SPS enforces a set of standards, and because it does have some "policing" functions, (loved by management and loathed by practitioners) I have seen agencies try to adapt to the use of the system with varying, sometimes problematic results. Why? Because enforcement of standards, down to and including the clauses, the use of competition, and the decisions as to how to structure contracts, is inconsistent or non-existent. The aging demohraphic of the workforce, coupled with herky-jerky advances in technology, add to the training and readiness problem. If we expect enforceable, high quality risk apportionment in our contracting regime, we need to grapple with the training, the technology, and the enforcement of standards as a way to tackle part of the problem. We clearly are only scratching at the surface. We also need to consider authorship and adoption of an Electronic Federal Acquisition Supplement (EFARS) to provide tools adapted for the digital contracting domain (such as repudiation of digital media content, and canonical standards for interoperability between contracting systems). The staus quo will not suffice for the needs of the aging demographic and the emerging world of Digital Contracts. Chris Webster WebsterCw@cox.net - -- ---------------------------------------------- Date: Tue, 29 Oct 2002 14:04:17 -0500 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far? Although I agree with the sentiment that the CO position and role within government must be refined and strengthened, I would like it noted for the record how difficult a CO's job really is. Having spent many years as contracting officer, I want to give a perspective from the worker level. There are many, many Contracting Officers and Specialists doing good work every day despite of the fact that they are woefully underpaid, overworked and universally assailed as poorly trained bureaucrats responsible for the problems associated with the procurement process. Good CO's are assigned more work than they can properly perform in any given 8 hour day. It is a thankless job in many respects that is not "mission critical" to many program people. To perform the CO function as it should be done, the job requires endless hours of otherwise mundane tasks, i.e. filing, typing, reviewing invoices, etc. The lack of administrative support has only increased the problems. Another significant issue facing contracting folks is the lack of respect by their programmatic government counterparts. CO's face tremendous opposition from their "customers" in their everyday efforts to perform their jobs. Too often, programmatic "customers" show outright distain and a complete lack of respect for their contracting counterparts and the ever increasing regulations they must try to follow. Program people in government want what they want and they want it yesterday - as a CO, I understood their frustrations but many times could not do anything about it in such a rules based environment. I had to sympathize with many of the program people - they had jobs to do and the single biggest obstacle to getting anything done was the procurement process. Before the rules were too tight; now people complain the process has been relaxed too much such that the government its giving away its money. The CO seems to be the brunt of both arguments - it is really hard to win in this game. Sometimes it is hard to figure out what the rules are especially in light of the latest craze of fee for service environments where customers are free to take their business elsewhere if they are not suitably accommodated - even if that means bending rules to make people happy. This can be a difficult environment for good COs that cannot adjust to being continuously told to "just do it" in the name of customer service. That said, unfortunately, too many COs and the specialists that work for them are in over their heads compared to their private sector counterparts. I believe this problem stems from a lack of appropriate education, training, and people to perform many of the more routine, but mandated, paperwork and reporting requirements that go with every single procurement. Also, many COs lack a business acumen that comes from a varied educational and work related background - they have been trained to follow the rules without regard to what makes good business sense. I think a huge problem is that many good COs have become worn down over the years by the job. Regardless of what your opinion of the current state of federal procurement is, one thing is clear - the 1102 series needs a major overhaul. When I was a CO in government, I dealt with many highly skilled, educated and motivated people sitting across the table from me. After awhile, the job wore me down to and it because clear that I did not see a future for me as a government procurement official - that was sad. I put many, many hours in the job yet my only reward was more work with little or no upward mobility. Unless something is done, the problem is only going to get worse as the government desires to "contract out" more and more essential functions. Christopher M. Toven Vice President, Contracts & General Counsel AnviCom, Incorporated - ------------------------------------------------------------ I would be interested in seeing what the author [Chris Webster -above] has, in the way of specific detail, to substantiate a position(s) that would seem to dwell somewhere between "sophomoric" and "conclusory". Yes, anyone who has so much as heard the terms "SPS" and PDD (PD Squared), are aware of their serious shortcomings. So what else is new? And, what about "digital media" and "digital contracts". What's the big deal? It's all EIT, isn't it. What are the specific problems; and, more importantly, what would the author offer in the way of a set of solutions? Mark.S.Pfeiffer@irs.gov (at 57, part of the "aging demographic of the workforce"...thank you very much) ------------------------------------------------ Date: Wed, 30 Oct 2002 17:41:11 -0500 Subject: [pubklaw-l] Re: Have Federal Procurement Reforms Gone Too Far [Here is the last word from Professor Tompkins. I think we've exhausted the topic for now. I'll post a complete set of comments on the web.-JAW] While managing a major federal information technology acquisition I worked with several contracting officers. Three attributes characterized the best. First, they clearly distinguished law from policy and were willing to explain the reasons for the positions they took. They did not take umbrage when I said "show me the law or regulation." Second, they were risk managers, not risk avoiders. It is the program manager's job to manage - and take reasonable risks. It is the contracting officer's task to insure the PM has a proper appreciation of the risks (and benefits). Finally, they were diplomatic without being timid. Knowing where and under what circumstances the program manager's open to challenge and education is important. If the program manager does not encourage candor in the confines of his office, s/he's a fool. If s/he permits challenges or adverse remarks in inappropriate venues, s/he also merits a motley doublet. Charles E. Tompkins III Professor of Systems Management Tompkinsc@ndu.edu ------------------------------------------------- Although not part of the original thread, the following comment with a link to Kelman paper came in afterwards. From: "Shirey, Susan" To: "'jwalz@pubklaw.com'" Subject: Harvard Paper on Procurement Reforms Date: Thu, 31 Oct 2002 11:57:11 -0600 I ran across this today. I realize you've closed the reform issue for awhile, but thought you might want to keep this in mind the next time the topic comes up. This is one of the best analyses of the pros and cons of acquisition reform that I've seen. Sue Shirey susan.shirey@cobalt-corp.com http://www.ksg.harvard.edu/visions/publication/kelman.pdf -