Implementation of OMB Circular No. A-76 at Science Agencies
Gao ID: GAO-07-434R March 16, 2007Congress requested that GAO determine how the Department of Commerce (National Institute for Standards and Technology and the National Oceanic and Atmospheric Administration), the Department of Energy, the Environmental Protection Agency (EPA), and the National Aeronautics and Space Administration (NASA) have implemented the May 2003 revised Office of Management and Budget (OMB) Circular A-76 process, which seeks to put commercial activities now performed by government out for public-private competition. Congress was particularly interested in outcomes where public-private competitions resulted in commercial activities being contracted out to the private sector. On December 14, 2006, we briefed Congress on the preliminary results of our review. This report is an updated version of the briefing document we used.
In summary, we found that the five science agencies under the Committee's jurisdiction generally implemented the A-76 process as revised in May 2003. However, we did find one exception and two deviations. The exception involved the Department of Commerce, which had not put out for competition any commercial activity performed by National Institute for Standards and Technology personnel. Additionally, OMB granted deviations to the new A-76 process requirements for two other agencies. OMB allowed NASA to put out for competition new commercial scientific and technological research activities--called NASA Research Announcements--outside the normal A-76 process. Nearly all of NASA's public-private competitions have been competed under this deviation. OMB also approved the Department of Energy's pilot program for determining whether use of the General Services Administration's Multiple Award Schedules would increase competition. We also found that, while the five agencies generally implemented the A-76 process, few of the hundreds of commercial activities they determined suitable for public-private competition were competed. According to agencies officials, agencies recognized that activities performed by 10 or fewer employees were so small that the costs of conducting public-private competitions would outweigh any expected savings. Finally, we found that the private sector won few of the science agency activities put out for competition. Specifically, from fiscal year 2003 through fiscal year 2005, the agencies held 22 public-private competitions. In-house organizations won 19 of these competitions and the private sector won 3. The agencies estimated that the contracts for the three activities won by the private sector were performed by 337 federal employees and would save over $45 million.
GAO-07-434R, Implementation of OMB Circular No. A-76 at Science Agencies
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March 16, 2007:
The Honorable Bart Gordon:
Chairman:
Committee on Science and Technology:
House of Representatives:
Subject: Implementation of OMB Circular No. A-76 at Science Agencies:
You requested that we determine how the Department of Commerce
(National Institute for Standards and Technology and the National
Oceanic and Atmospheric Administration), the Department of Energy, the
Environmental Protection Agency (EPA), and the National Aeronautics and
Space Administration (NASA) have implemented the May 2003 revised
Office of Management and Budget (OMB) Circular A-76 process, which
seeks to put commercial activities now performed by government out for
public-private competition. You were particularly interested in
outcomes where public-private competitions resulted in commercial
activities being contracted out to the private sector. On December 14,
2006, we briefed your staff on the preliminary results of our review.
Attached is an updated version of the briefing document we used.
In summary, we found that the five science agencies under the
Committee's jurisdiction generally implemented the A-76 process as
revised in May 2003. However, we did find one exception and two
deviations. The exception involved the Department of Commerce, which
had not put out for competition any commercial activity performed by
National Institute for Standards and Technology personnel.
Additionally, OMB granted deviations to the new A-76 process
requirements for two other agencies. OMB allowed NASA to put out for
competition new commercial scientific and technological research
activities--called NASA Research Announcements--outside the normal A-
76 process. Nearly all of NASA's public-private competitions have been
competed under this deviation. OMB also approved the Department of
Energy's pilot program for determining whether use of the General
Services Administration's Multiple Award Schedules would increase
competition.
We also found that, while the five agencies generally implemented the A-
76 process, few of the hundreds of commercial activities they
determined suitable for public-private competition were competed.
According to agencies officials, agencies recognized that activities
performed by 10 or fewer employees were so small that the costs of
conducting public-private competitions would outweigh any expected
savings. As a result, agencies did not conduct competitions on those
activities, except EPA, which conducts public-private competitions for
activities performed by 10 or fewer employees.
Finally, we found that the private sector won few of the science agency
activities put out for competition. Specifically, from fiscal year 2003
through fiscal year 2005, the agencies held 22 public-private
competitions. In-house organizations won 19 of these competitions and
the private sector won 3. The agencies estimated that the contracts for
the three activities won by the private sector were performed by 337
federal employees and would save over $45 million.
To determine how the science agencies have conducted the revised A-76
process, we reviewed OMB guidance, performance reports, agency
competitive sourcing policies and procedures, and analyzed historical
documents such as agency competitive sourcing plans, and studies used
to make sourcing decisions. We interviewed officials responsible for
managing competitive sourcing programs to document A-76 procedures at
the Department of Commerce (National Institute for Standards and
Technology and the National Oceanic and Atmospheric Administration),
Department of Energy, EPA, and NASA. To obtain information about
activities competed and contracted out to private-sector entities, we
performed detailed analyses of the agencies' fiscal years 2003 through
2005 commercial activity and competitive sourcing reports of
competitions. We conducted our work from August 2006 through January
2007 in accordance with generally accepted government auditing
standards.
We provided this report to the Department of Commerce, the Department
of Energy, EPA, and NASA for review and comment. The Department of
Commerce and NASA responded in formal letters, which are included in
enclosures II and III, respectively. The Department of Energy and EPA
provided comments via email. All agencies agreed with our findings and
observations. The Department of Commerce and EPA provided technical
comments, which we incorporated into the report as appropriate.
As we agreed with your office, unless you publicly announce the
contents of this report earlier, we plan no further distribution of it
until 30 days from the date of this letter. At that time, we will then
send copies of the report to interested congressional committees, the
Director of OMB, the Secretaries of Commerce and Energy, and
Administrators of the Environmental Protection Agency and the National
Aeronautics and Space Administration. We will make copies available to
others upon request. In addition, this report will be available on the
GAO Web site at www.gao.gov.
If you or your staff have questions concerning this report, please
contact me at (202) 512-4841 or liA@gao.gov. Contact points for our
Offices of Congressional Relations and Public Affairs may be found on
the last page of this report. Other key contributors to this briefing
were James Fuquay, Assistant Director; Myra Watts-Butler, Greg
Campbell, Jean Lee, Sanford Reigle, and Sylvia Schatz.
Sincerely,
Signed by:
Allen Li:
Director, Acquisition and Sourcing Management:
Enclosure I: Briefing:
Why GAO Did This Study:
The Office of Management and Budget (OMB) Circular A-76 tasks federal
agencies with identifying work that could be considered for private-
public competition. In May 2003, OMB revised the Circular. The Chairman
of the House Committee on Science requested GAO to (1) determine how
the revised Circular A-76 process has been conducted at the five
science agencies under the Committee‘s jurisdiction, and (2) obtain
information about activities competed and contracted out to private
sector entities.
Summary:
The science agencies that GAO reviewed”the National Institute for
Standards and Technology (NIST) and the National Oceanic and
Atmospheric Administration (NOAA), which are bureaus within the
Department of Commerce; Department of Energy (DOE); Environmental
Protection Agency (EPA); and National Aeronautics and Space
Administration (NASA) ”generally implemented the A-76 process as
revised in May 2003. Exceptions include:
* Commerce had not put out for competition any commercial activity
performed by NIST personnel. According to Commerce competitive sourcing
officials, language in a conference report (House Report 108-010)
prohibited NIST from competing activities under Circular A-76.
* OMB granted deviations to the new A-76 process requirements for two
other agencies.
- OMB approved Energy‘s program for determining whether use of the
General Services Administration‘s Multiple Award Schedules under a
standard competition, which have a significant number of qualified
contractors, would increase competition.
- OMB granted NASA‘s request to hold competitions for new commercial
scientific and technological research activities”called NASA Research
Announcements (NRA) ” outside the normal A-76 process. Nearly all of
NASA‘s competitions held in fiscal years 2003 through 2005 fell under
this A-76 deviation approved by OMB.
While the five science agencies we reviewed perform hundreds of
commercial activities that they determined suitable for public-private
competition, few of these activities were competed in fiscal years 2003
through 2005 and very few competitions were won by the private sector.
* According to agencies officials, most activities involved 10 or fewer
federal employees and were eliminated from public-private competition
because the cost of conducting a competition would outweigh any
expected saving. EPA was the exception and did conduct competition for
10 of fewer employees.
* Agencies held 22 public-private competitions. Of these competitions,
in-house organizations won 19 and the private sector won 3. The
agencies estimated that more efficient performance of the 19 activities
won in-house would save them about $583 million and the contracts for
the 3 activities formerly performed by 337 federal employees would save
about $45 million over the performance periods specified.
Background:
In 1966, the Bureau of the Budget, predecessor of the OMB, issued
Circular A-76 to provide guidelines for determining whether a
commercial activity should be performed by a federal agency or under
contract. However, early implementation of the A-76 process was roundly
criticized as inconsistent and frequently inequitable. Over the next 3
decades, OMB made several revisions to the circular to provide a more
streamlined and equitable process. Despite these efforts, debate
continued about the value and limitations of the A-76 process. In 2001,
to help institutionalize use of competitive sourcing, OMB mandated that
agencies compete at least 5 percent of their full-time equivalents
(FTE) listed on their commercial activities inventories by the end of
fiscal year 2002 and another 10 percent by the end of fiscal year 2003.
Congress criticized these targets as arbitrary and potentially
damaging, and directed GAO to convene a panel to study the government‘s
competitive sourcing policies and procedures. In April 2002, the
Commercial Activities Panel reported its findings and recommended the
development of an integrated competition process bringing elements of
the Federal Acquisition Regulation into Circular A-76 to provide
greater accuracy, enhance accountability, and ensure greater fairness.
How Has A-76 process been conducted?
Key Points in OMB Circular A-76 and May 2003 Revision:
Circular A-76:
* Does not prescribe how an agency is to select which commercial
activities will undergo competition.
* Directs that before government personnel may perform a new
requirement, competition shall be used to determine whether government
personnel should perform the commercial activity. NASA Research
Announcements --new commercial scientific and technological research
activities --are new requirements.
* Encourages agencies to obtain deviations from circular procedures to
explore innovative alternatives to standard or streamlined
competitions.
In May 2003, OMB issued its most recent and arguably the most
significant revision to Circular A-76. Changes made were generally
consistent with the Commercial Activities Panel‘s recommendations and
should provide an improved foundation for competitive sourcing
decisions. Key changes include:
* centralized oversight and post-competition accountability
rules”performance standards and quality assurance surveillance
plans”are required for both public and private providers;
* greater reliance on procedures in the Federal Acquisition Regulation
to provide a more consistently applied competitive process; and
* expanded reporting to measure results”estimated and actual cost of
performance must be tracked.
Agencies Follow Circular A-76 Although Deviations Have Been Granted:
The five science agencies generally follow the A-76 competitive
sourcing process, as revised in May 2003. The revised Circular A-76
established process requirements for agencies to subject commercial
activities performed by the federal government employees to
competition. The process can be viewed as having five basic steps,
depicted in the figure. A detailed discussion of each step is contained
in appendix II.
Figure: Five Basic Steps of the A-76 Process:
[See PDF for Image]
Source: OMB Circular A-76, May 29, 2003.
[End of figure]
Incorporated within each of these basic steps are management control
procedures such as OMB reviews and consultations, standard data
requirements, and prescribed reporting formats. Under the revised A-76
process, agencies are encouraged to explore innovative alternatives to
competitions.
While each of the science agencies conducts similar A-76 processes
under the revised circular, we identified several differences”how
agencies select commercial activities for competition and deviations to
the A-76 requirements OMB granted to NASA and Energy. Also, with the
May 2003 revision, research and development activities were no longer
exempted from A-76 competitions.
We found that all five agencies did not use the same procedures to
select activities for competition. Commerce (NIST and NOAA), Energy,
and NASA chose to use feasibility studies to select which commercial
activities to compete. However, the EPA relied on a competitive
sourcing council consisting of managers within the agency to select
candidates for competition. The council met numerous times over an 18-
month period to make its selections. According to the EPA Director of
Competitive Sourcing, the council did not follow any formal procedures
or criteria in its deliberations.
We also found that OMB granted NASA and Energy deviations from the
process.
NASA Deviation: In June 2003, NASA requested a Circular A-76 deviation
from a standard or streamlined competition to conduct public-private
competitions for scientific and technological research and development
using broad agency announcements, pursuant to FAR Part 35 and NASA‘s
FAR Supplement, since the circular did not specifically address how to
conduct these competitions. OMB granted the request to enable NASA to
serve as a prototype to develop best practices for public-private
competitions for research and development activities and to allow NASA
to continue conducting public-private competitions for commercial
scientific and technological research activities under NASA
regulations. OMB acknowledges, however, that these deviations focus on
contracting for new work requirements rather than improving the
efficiency of existing workloads. For a number of years, NASA has
opened many of its new research and development requirements to
competition between scientists at NASA, industry, academia, and other
institutions. NASA invites scientists from throughout the scientific
community to submit proposals in response to broad agency announcements
publicized in FedBizOpps, the government‘s Web site listing contracting
opportunities. Panels of experts evaluate submitted proposals and make
awards based on best value as determined by scientific merit and cost
reasonableness. According to OMB, the deviation could enable NASA to
serve as a prototype to develop best practices for public-private
competitions for research and development activities. Nearly all (38 of
40) NASA competitions held in fiscal years 2003 through 2005 have been
competed under the deviation.
Energy Deviation: In March 2004, Energy requested a deviation from the
A-76 process requirements to conduct a pilot program for determining
whether use of the General Services Administration‘s Multiple Awards
Schedules (MAS) to obtain private-sector offers would increase
competition. Energy sought the deviation based on the significant
number of qualified contractors offering the needed services. OMB
granted the request in May 2004. Energy held two competitions”one using
a full and open competition and one using the supply schedules. Both
activities”one for human resource training and one for logistics
support”were of similar size. The full and open competition received
only the agency in-house bid, whereas, the supply schedule competition
received three bids”two MAS vendors and one from within the agency.
According to the Energy‘s Director of Competitive Sourcing, whenever
possible the federal supply schedule should be used as a procurement
vehicle for A-76 competitions.
As part of the commercial activity inventory process, the agencies
identified their activities suitable for public-private competition.
Although the science agencies had hundreds of activities available for
competition, few were likely to be competed. According to agencies
officials, activities performed by 10 or fewer employees were so small
that the costs of conducting a public-private competition would
outweigh any expected savings. EPA, however, was the exception and did
conduct competitions for 10 or fewer employees. For example, of the 11
competitions held by EPA between fiscal years 2003 and 2005, eight of
the competitions were for activities performed by 10 or fewer
employees.
We found that most of the activities available for competition in
fiscal years 2003 through 2005 were performed by 10 or fewer federal
employees. The table on the following page shows the distribution of
activities and associated FTEs.
Activities Competed and Contracted Out:
FAIR Act Requirements:
The Federal Activities Inventory Reform (FAIR) Act of 1998 (Public Law
105-270) requires federal agencies to annually submit inventories of
their commercial activities. Prior to the act, some agencies failed to
submit inventories or failed to submit them on time. In 1999, OMB
incorporated the FAIR Act requirements into the A-76 process.
Section 647(b) of Division F of the Consolidated Appropriation Act,
2004 (Public Law 108-199) requires each executive agency to report
annually to Congress on specific data on their competitive sourcing
efforts under the FAIR Act inventory submitted the prior fiscal year.
Also, OMB requires agencies to update savings and performance data on
competitions completed since fiscal year 2003
Limited Number of Competitions Held:
Table: Commercial Activities Available for Competition by FTEs:
Agency: Energy;
FTEs per Activity: 0-10;
FY 2003: Activities: 1829;
FY 2003: FTEs: 2343;
FY 2004: Activities: 1621;
FY 2004: FTEs: 2049;
FY 2005: Activities: 1690;
FY 2005: FTEs: 2265.
Agency: Energy;
FTEs per Activity: 11-65;
FY 2003: Activities: 8;
FY 2003: FTEs: 123;
FY 2004: Activities: 12;
FY 2004: FTEs: 221;
FY 2005: Activities: 13;
FY 2005: FTEs: 288.
Agency: Energy;
FTEs per Activity: >65;
FY 2003: Activities: 0;
FY 2003: FTEs: 0;
FY 2004: Activities: 0;
FY 2004: FTEs: 0;
FY 2005: Activities: 0;
FY 2005: FTEs: 0.
Agency: Energy;
FTEs per Activity: Total;
FY 2003: Activities: 1837;
FY 2003: FTEs: 2466;
FY 2004: Activities: 1633;
FY 2004: FTEs: 2270;
FY 2005: Activities: 1703;
FY 2005: FTEs: 2553.
Agency: EPA;
FTEs per Activity: 0-10;
FY 2003: Activities: 506;
FY 2003: FTEs: 737;
FY 2004: Activities: 525;
FY 2004: FTEs: 717;
FY 2005: Activities: 993;
FY 2005: FTEs: 1524.
Agency: EPA;
FTEs per Activity: 11-65;
FY 2003: Activities: 14;
FY 2003: FTEs: 270;
FY 2004: Activities: 7;
FY 2004: FTEs: 128;
FY 2005: Activities: 19;
FY 2005: FTEs: 347.
Agency: EPA;
FTEs per Activity: >65;
FY 2003: Activities: 0;
FY 2003: FTEs: 0;
FY 2004: Activities: 0;
FY 2004: FTEs: 0;
FY 2005: Activities: 0;
FY 2005: FTEs: 0.
Agency: EPA;
FTEs per Activity: Total;
FY 2003: Activities: 520;
FY 2003: FTEs: 1007;
FY 2004: Activities: 532;
FY 2004: FTEs: 845;
FY 2005: Activities: 1012;
FY 2005: FTEs: 1871.
Agency: NASA;
FTEs per Activity: 0-10;
FY 2003: Activities: 321;
FY 2003: FTEs: 865;
FY 2004: Activities: 285;
FY 2004: FTEs: 738;
FY 2005: Activities: 271;
FY 2005: FTEs: 687.
Agency: NASA;
FTEs per Activity: 11-65;
FY 2003: Activities: 42;
FY 2003: FTEs: 915;
FY 2004: Activities: 35;
FY 2004: FTEs: 708;
FY 2005: Activities: 35;
FY 2005: FTEs: 826.
Agency: NASA;
FTEs per Activity: >65;
FY 2003: Activities: 9;
FY 2003: FTEs: 2600;
FY 2004: Activities: 8;
FY 2004: FTEs: 2014;
FY 2005: Activities: 8;
FY 2005: FTEs: 1892.
Agency: NASA;
FTEs per Activity: Total;
FY 2003: Activities: 372;
FY 2003: FTEs: 4380;
FY 2004: Activities: 328;
FY 2004: FTEs: 3460;
FY 2005: Activities: 314;
FY 2005: FTEs: 3405.
Agency: NIST;
FTEs per Activity: 0-10;
FY 2003: Activities: 32;
FY 2003: FTEs: 106;
FY 2004: Activities: 37;
FY 2004: FTEs: 110;
FY 2005: Activities: 32;
FY 2005: FTEs: 99.
Agency: NIST;
FTEs per Activity: 11-65;
FY 2003: Activities: 7;
FY 2003: FTEs: 187;
FY 2004: Activities: 10;
FY 2004: FTEs: 223;
FY 2005: Activities: 12;
FY 2005: FTEs: 261.
Agency: NIST;
FTEs per Activity: >65;
FY 2003: Activities: 2;
FY 2003: FTEs: 239;
FY 2004: Activities: 2;
FY 2004: FTEs: 196;
FY 2005: Activities: 2;
FY 2005: FTEs: 196.
Agency: NIST;
FTEs per Activity: Total;
FY 2003: Activities: 41;
FY 2003: FTEs: 532;
FY 2004: Activities: 49;
FY 2004: FTEs: 529;
FY 2005: Activities: 46;
FY 2005: FTEs: 556.
Agency: NOAA;
FTEs per Activity: 0-10;
FY 2003: Activities: 417;
FY 2003: FTEs: 752;
FY 2004: Activities: 368;
FY 2004: FTEs: 758;
FY 2005: Activities: 346;
FY 2005: FTEs: 688.
Agency: NOAA;
FTEs per Activity: 11-65;
FY 2003: Activities: 10;
FY 2003: FTEs: 165;
FY 2004: Activities: 12;
FY 2004: FTEs: 207;
FY 2005: Activities: 12;
FY 2005: FTEs: 209.
Agency: NOAA;
FTEs per Activity: >65;
FY 2003: Activities: 0;
FY 2003: FTEs: 0;
FY 2004: Activities: 0;
FY 2004: FTEs: 0;
FY 2005: Activities: 0;
FY 2005: FTEs: 0.
Agency: NOAA;
FTEs per Activity: Total;
FY 2003: Activities: 427;
FY 2003: FTEs: 917;
FY 2004: Activities: 380;
FY 2004: FTEs: 965;
FY 2005: Activities: 358;
FY 2005: FTEs: 897.
Source: Agencies FAIR Act inventories for fiscal year 2003 through
fiscal year 2005.
[End of table]
Except for NIST, over 86 percent of the commercial activities available
for competition at each agency were performed by 10 or fewer federal
employees. For example, in 2005, 1,690 of 1,703 activities or over 99
percent of the activities at Energy were performed by 10 or fewer
federal employee. At NIST, 32 of 46 NIST activities or nearly 70
percent were performed by 10 or fewer federal employees.
Prior to the May 2003 revision, agencies could directly convert
activities with 10 or fewer FTEs to the private sector. However, under
the revised Circular A-76 direct conversions are no longer allowed.
According to OMB, direct conversions of government activities to the
private sector were eliminated to close loopholes that diminish the
taxpayer‘s return on investment and to improve agency performance.
According to agencies‘ officials, most small activities have been
removed from public-private competitions. Most agencies did not conduct
competitions on activities performed by 10 or fewer employees. For
example, NASA‘s competitive sourcing plan states that activities
performed by 10 or fewer employees will not be reviewed for possible
competition because there is little likelihood of achieving tangible
benefits. However, EPA is an exception. Unlike the other science
agencies, EPA held 8 of its 11 competitions for activities performed by
10 or fewer employees between fiscal years 2003 and 2005.
Although the science agencies had hundreds of commercial activities
deemed suitable for competition, few competitions were held. The table
below shows the number of competitions held with associated FTEs for
each of the five science agencies during fiscal years 2003 through
2005.
Table: Competitions Held during FY 2003-2005:
Agency: Energy;
Competitions: 7;
FTEs involved: 1,207;
Expected savings (in millions): $532.5.
Agency: EPA;
Competitions: 11;
FTEs involved: 91;
Expected savings (in millions): $3.6.
Agency: NASA;
Competitions: 2[A];
FTEs involved: 237;
Expected savings (in millions): $46.0.
Agency: NIST;
Competitions: 0;
FTEs involved: 0;
Expected savings (in millions): 0.
Agency: NOAA;
Competitions: 2;
FTEs involved: 43;
Expected savings (in millions): $1.2.
Total;
Competitions: 22;
FTEs involved: 1,578;
Expected savings (in millions): $583.3.
Source: Agency 647 reports.
[A] NASA completed competitions do not include the 38 research
announcements competed under an A-76 deviation.
[End of table]
While Commerce identified NIST activities suitable for public-private
competition in each of the fiscal years, it held no competitions.
According to Commerce competitive sourcing officials, feasibility
studies are being done to identify possible candidates for competition.
The conference report language (House Report 108-010) only required
NIST to submit a detailed plan, which was submitted to the chairmen and
ranking minority members of the House and Senate Appropriation
subcommittees for NIST on November 28, 2003. Moreover, the conference
report refers to a concern about the direct conversion of FTEs, which
is no longer a concern since the revised A-76 eliminated the use of
direct conversions of commercial activities. According to officials at
Commerce, so far, no activity at NIST has been found that would result
in a good return on investment; but should one be identified, they will
inform Congress of their intent to conduct an A-76 competition.
Activities competed in fiscal years 2003 through 2005 were concentrated
within 15 categories. The following table identifies the type of
activities competed by each agency.
Table: Activities Competed During Fiscal Years 2003 through 2005:
Activity: Accounts payable;
Energy: [Empty];
EPA: 1;
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: General accounting;
Energy: 1;
EPA: [Empty];
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: Data Collection and Analysis;
Energy: 1;
EPA: [Empty];
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: FIFRA/FDCA Risk Analysis;
Energy: [Empty];
EPA: 1;
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: FSCA Risk Analysis;
Energy: [Empty];
EPA: 1;
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: Contracting (Operational);
Energy: [Empty];
EPA: [Empty];
NASA: 1;
NIST: [Empty];
NOAA: [Empty].
Activity: Industrial Plant Equipment;
Energy: 1;
EPA: [Empty];
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: RDT&E Administrative Support;
Energy: [Empty];
EPA: 5;
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: RDT&E;
Energy: [Empty];
EPA: [Empty];
NASA: 1;
NIST: [Empty];
NOAA: [Empty].
Activity: Other S&T and R&D Management and Support Activities;
Energy: [Empty];
EPA: [Empty];
NASA: [Empty];
NIST: [Empty];
NOAA: 1.
Activity: Supply Operations;
Energy: 2;
EPA: 1;
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: Training Management;
Energy: 1;
EPA: [Empty];
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: Computing Services and Data Base Management;
Energy: 1;
EPA: 1;
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Activity: Other Computing Services;
Energy: [Empty];
EPA: [Empty];
NASA: [Empty];
NIST: [Empty];
NOAA: 1.
Activity: Systems Design, Development and Programming Services;
Energy: [Empty];
EPA: 1;
NASA: [Empty];
NIST: [Empty];
NOAA: [Empty].
Total;
Energy: 7;
EPA: 11;
NASA: 2;
NIST: 0;
NOAA: 2.
Source: Agency 647 reports.
[End of table]
The table does not include the 38 NASA research announcements competed
under special deviation authority during fiscal years 2003 through
2005. NASA reported all 38 announcements as Research, Development, Test
and Evaluation activities. Appendix III lists these announcements.
Of the 22 commercial activity competitions held by the science agencies
in fiscal years 2003 through 2005, the in-house team won 19 or about 86
percent and the private sector won 3 or about 14 percent. The following
table shows the Circular A-76 competitions completed by each of the
science agencies from fiscal years 2003 through 2005.
Table: Completed A-76 Competitions (FY 2003 - FY 2005):
Agency: Energy;
In-house: 6;
Private sector: 1;
Total: 7.
Agency: EPA;
In-house: 10;
Private sector: 1;
Total: 11.
Agency: NASA;
In-house: 1;
Private sector: 1;
Total: 2.
Agency: NIST;
In-house: -;
Private sector: -;
Total: -.
Agency: NOAA;
In-house: 2;
Private sector: -;
Total: 2.
Total;
In-house: 19;
Private sector: 3;
Total: 22.
Source: Agency 647 reports.
[End of table]
The three competitions that the private sector won were for activities
performed by 337 FTEs or 21 percent of the total FTEs competed.
According to competitive sourcing officials at Energy and EPA science
agencies, all tasks under these contracts have been moved out of the
agency and assumed by the contractor. Tasks under the NASA contract are
scheduled to be moved out of the agency by August 31, 2008. The
agencies estimated that the three contracts with a value of nearly $259
million will save them over $45 million. The table following describes
these three contracts.
Table: Competitions Won By Contractors (FY 2003 through FY 2005):
Dollars in millions.
Activity completed: Energy: HQS Logistics;
No. of FTEs competed: 136;
Contractor: Logistics Applications Inc.;
Contract performance period: May 01, 2006 through July 20, 2011;
Contract value: $28.7;
Expected savings: $3.1;
All tasks converted: Yes.
Activity completed: NASA: NASA Shared Services Center;
No. of FTEs competed: 200;
Contractor: Computer Sciences Corporation;
Contract performance period: Sep. 01, 2005 through Aug. 31, 2010;
Contract value: $230.0;
Expected savings: $42.0;
All tasks converted: Aug. 31, 2008.
Activity completed: EPA: Fleet and Property Management;
No. of FTEs competed: 1;
Contractor: Mandaree Enterprise Corporation;
Contract performance period: Jan. 01, 2004 through Dec. 31, 2006;
Contract value: $.158;
Expected savings: $.012;
All tasks converted: Yes.
Total;
No. of FTEs competed: 337;
Contract value: $258.858;
Expected savings: $45.22.
Source: Agency data on A-76 activities.
Note: Competitions awarded under the deviation by NASA are not included
in this table.
[End of table]
Although the private sector won only 3 of 22 Circular A-76 competitions
held by the science agencies, the private sector won the majority of
NASA research announcements competed under the special A-76 deviation.
According to NASA, the private sector won over 89 percent of these
competitions. However, because each announcement resulted in multiple
awards in each area of study, the exact number of awardees funded could
have been more numerous. For example, the Advanced Component Technology
(ACT) Program announcement resulted in14 different awards. Another
announcement, the Astronomy and Physics Research and Analysis program,
resulted in 47 awards. According to the Deputy Director responsible for
NASA competitive sourcing, the competitive sourcing office does not
specifically track the awards made under each announcement. Appendix
III lists NASA‘s research announcement competitions in fiscal years
2003 through 2005.
Commerce's Interpretation of Congressional Direction:
According to officials of the Department of Commerce, they are
prohibited from competing commercial activities performed in their NIST
bureau.
House Report 108-010 – Making Further Continuing Appropriations for the
Fiscal Year 2003, and for Other Purposes states:
’Competitive sourcing. The conferees understand that there are efforts
within the Department of Commerce and other Departments, to use the
implementation of the President‘s Management Initiative for Competitive
Outsourcing (the A-76 process) as a way to reduce staff by more than 50
percent. This initiative is designed to compete or directly convert 15
percent of those positions identified as commercially competitive.
However, the conferees understand that efforts are underway to identify
roughly 75 percent of NIST‘s positions as commercial for purposes of
this initiative. While the conferees certainly agree that there are
certain advantages to competitive outsourcing, there is a concern that
blind implementation could severely inhibit the operations of the
Institute in the future. The conferees direct NIST to provide a
detailed plan to the Committees on Appropriations prior to any changes
in support of …competitive outsourcing.‘“
Senate Report 108-144 – Departments of Commerce, Justice, and State,
the Judiciary, and Related Agencies Appropriation Bill, 2004 directs:
’NIST to consult with the Committees on Appropriations before
proceeding with further implementation of competitive outsourcing and
that no funds be used for FAIR Act studies in support of the A-76
contracting process.
Agency View of Activities That Can Be Successfully Contracted Out:
According to agency competitive sourcing officials, they expect the in-
house organization to win most competitions. For example, Energy
officials told us that they expect the in-house win rate to be higher
than the private-sector win rate because most commercial type
activities such as cleaning and general maintenance have already been
contracted out. The remaining activities are more complex and require
greater knowledge about agency operations, which officials said gives
agency employees an advantage. Similarly, NASA officials told us that
NASA started off about 30 years ago contracting out many of its
commercial services and now has fewer such services to compete.
Appendix I:
Scope and Methodology:
To determine how the science agencies have conducted the revised A-76
process, we reviewed OMB guidance, performance reports, and quarterly
evaluations. We also reviewed agency competitive sourcing policies and
procedures, and analyzed historical documents such as agency
competitive sourcing plans, and studies used to make sourcing
decisions. We interviewed officials responsible for managing
competitive sourcing programs to document A-76 procedures at the
Department of Commerce (National Institute for Standards and Technology
and the National Oceanic and Atmospheric Administration), Department of
Energy, Environmental Protection Agency, and the National Aeronautics
and Space Administration.
To obtain information about activities competed and contracted out to
private sector entities, we performed detailed analyses of the
agencies‘ fiscal years 2003 through 2005 commercial activity and
competitive sourcing reports, which were submitted to OMB.
We conducted our work from August 2006 through January 2007 in
accordance with generally accepted government auditing standards.
Appendix II: Revised Circular A-76 Process:
The revised Circular A-76 establishes process requirements for agencies
to subject commercial activities performed by the federal government
employees to competition. As established, the process can be viewed as
having five basic steps. Incorporated within these steps are management
control procedures such as OMB reviews and consultations, standard data
requirements, and prescribed reporting formats that can enhance the
accuracy, accountability, and equity of public-private competitions.
These basic steps are depicted and more detailed discussion follows.
Figure: Five Basic Steps of the A-76 Process:
[See PDF for Image]
Source: OMB Circular A-76, May 29, 2003.
[End of figure]
Develop Inventories. As the first step for implementing the A-76
process, by June 30th each year an agency submits two inventories
categorizing all activities performed by federal personnel.
* Inherently governmental inventory: This is a list of activities that
are so intimately related to the public interest as to mandate their
performance by government personnel. As a consequence, inherently
governmental activities cannot undergo public-private competition. The
competitive sourcing official (CSO)”agency official responsible for
implementing the A-76 process”justifies, in writing, any activity
designated as inherently governmental and provides justifications to
OMB and the public upon request.
* Commercial activities inventory (FAIR Act inventory): This is a list
of activities performed by federal government personnel that, in the
judgment of the head of the agency, are not inherently governmental
activities. The CSO determines whether each commercial activity is
available for public-private competition and codes each activity to
indicate the rationale for the determination made. The reason codes
used to describe the commercial activities performed by federal
employees are as follows:
Table:
Reason code: A;
Reason code definition: Commercial activity is not appropriate for
private-sector performance pursuant to a written justification by the
CSO. Written justifications are available to OMB and the public, upon
request.
Reason code: B;
Reason code definition: Commercial activity is suitable for a
streamlined or standard competition.
Reason code: C;
Reason code definition: Commercial activity is the subject of an in-
progress streamlined or standard competition.
Reason code: D;
Reason code definition: Commercial activity is performed by federal
employees as the result of a standard or streamlined competition within
the past 5 years.
Reason code: E;
Reason code definition: Commercial activity is pending an agency
approved restructuring decision (e.g., closure, realignment).
Reason code: F;
Reason code definition: Commercial activity is performed by federal
employees due to a statutory prohibition against private-sector
performance.
Source: OMB.
[End of table]
For all activities coded ’A“, the CSO provides written justification.
Written justifications are not required for use of any other reason
code.
OMB establishes the annual format and data requirements for each of the
inventories. Since fiscal year 2004, OMB has required agencies to
provide the following data for activities listed on either inventory.
* Organization: agency, bureau, and unit name or abbreviation.
* Location: city, state, and country.
* Status of Full-Time Equivalent employees (FTE): number of FTEs,
function code, status (commercial or inherently governmental), and
reason code (commercial activities only).
* Additional Information: first year the activity appeared on the
inventory. (commercial activities only).
* Contact Information: person responsible for the activity.
OMB reviews and consults with the agencies regarding inventories‘
contents. Upon completion of the OMB review, the agencies make their
inventories available to the Congress and the public unless the
inventory information is classified or otherwise protected for national
security reasons. OMB must publish notice of the inventories‘
availability in the Federal Register. Interested parties”contractors,
federal employees, federal labor unions, business, or professional
associations”have 30 working days from publication of the notification
to challenge the designation of an activity as commercial or inherently
governmental or the reason code of a commercial activity.
Select Activities: Circular A-76 does not prescribe how an agency will
select which commercial activities will undergo public-private
competition from those listed in its commercial activities inventory
with reason code B”suitable for a streamlined or standard competition.
In deciding whether to use competitive sourcing, however, agencies
weigh potential performance improvements and expected cost savings
against the investment costs and risks associated with performing the
competition.
While OMB recognizes the value of using feasibility studies and
business case analyses, the circular does not require agencies to
develop either analysis. The circular specifically requires that before
announcing a public-private competition an agency complete the
following steps:
* identify activities and FTEs positions to be competed;
* research whether to group activities as business units consistent
with market and industry structures;
* assess workload data, quantifiable outputs, and performance standards;
* document the activity‘s baseline costs as currently performed;
* select the type of competition to be held”streamlined or standard;
* develop preliminary competition and completion schedules; and
* identify the roles and responsibilities of participants.
Finally, prior to beginning the public-private competition, the agency
informs incumbent service providers of the date that the competition
will be publicly announced.
Compete Activities: Once an agency has selected the activities to
undergo public-private competition, it makes a formal public
announcement to begin each competition. The announcement, which is made
locally and via FedBizOpps.gov, includes at a minimum identification of
the:
* activity being competed;
* agency, agency component, and location of the activity;
* type of competition to be held;
* incumbent service providers;
* number of government personnel performing the activity;
* names of the CSO, Agency Tender Official (ATO), and contracting
officer (CO); and
* projected end date of the competition.
The revised Circular A-76 established two types of public-private
competitions”standard and streamlined. The key differences between the
two types of competition are size and duration. Standard competitions
are required when the activity is performed by more than 65 FTEs and
are generally required to be completed in 12 or less months.
Streamlined competitions can be used when an activity is performed by
65 or fewer FTEs and are generally required to be completed in 90
calendar days. With some exceptions, agencies using fiscal year 2005
appropriations must show the private-sector bid will result in
government costs savings of 10 percent of personnel-related costs or
$10 million, whichever is less, before awarding the private sector an
activity with more than 10 FTEs. Competitions of activities performed
by 10 or fewer FTEs do not require a cost differential. The agency‘s
announcement of the performance decision concludes the competition step
of the A-76 process.
Standard competitions
After public announcement, the agency forms several teams of technical
and functional experts with specific competition process roles:
* Performance Work Statement (PWS) team”develops the performance work
statement (a statement in the solicitation that identifies the
technical, functional, and performance characteristics of the agency‘s
requirements with supporting workload data and performance standards)
and the quality assurance surveillance plan (a plan that identifies the
methods the agency will use to measure the performance of the service
provider against the PWS requirements).
* Most Efficient Organization (MEO) team”assists the ATO in developing
the agency tender (agency management plan responding to a
solicitation). The MEO represents the agency‘s most efficient and cost-
effective organization for implementing the agency tender. It usually
is a product of management analyses such as activity based costing,
business case analysis, reengineering, market research, and
consolidation.
* Source Selection Evaluation Board (SSEB)”assists the Source Selection
Authority (SSA) in selecting the source to provide the service under a
negotiated acquisition.
PWS team members not directly affected by the competition can also
serve on the SSEB. However, PWS team members can not serve on the MEO
team. MEO team members cannot serve on either the PWS team or the SSEB.
The CO, in consultation with the PWS team and in accordance with the
Federal Acquisition Regulation, develops and issues the solicitation
for the public-private competition. The solicitation identifies the
acquisition procedures (sealed bid or negotiated), type of source
selection process (such as lowest price technically acceptable or
phased evaluation), and evaluation factors to be used. The private
sector, incumbent agency (agency tenders), and other public agencies
(public reimbursable tenders) can submit offers in response to the
solicitation. Private sectors offers must respond as required by the
solicitation. In addition to the solicitation, agency and public
reimbursable tenders must comply with Circular A-76 requirements.
* Agency tender: The ATO develops and submits the agency tender that
includes an MEO cost proposal, quality control plan, phase-in plan, and
copies of any proposed subcontracts. To develop and certify the agency
cost proposal, the ATO must use COMPARE”software that incorporates the
costing procedures of Circular A-76. All agencies must use COMPARE to
calculate and document the costs presented on the standard competition
forms.
* Public reimbursable tender: Another federal agency develops and
submits an offer responding to the solicitation. In addition to the
offer, the agency must also submit proposal and plans required of an
MEO.
The contracting officer performs price analysis and determines cost
realism of all offers including the calculation of the cost
differential applied to the non-incumbent service provider and the
review of the Standard Competition Form (SCF) preparation. The agency
compares offers using the SCF. For sealed bid acquisition competitions,
the contracting officer makes the performance decision by certifying
SCF. For negotiated acquisition competitions, the SSA makes the
performance decision by certifying the SCF. Upon certification of the
SCF, ending the public-private competition, the agency formally
announces the performance decision and later makes the certified SCF
and agency and public reimbursable tenders available to the public,
upon request.
For performance decisions favoring a private sector offer, the
contracting officer awards a contract in accordance with the Federal
Acquisition Regulation. The contracting officer develops a fee-for-
service agreement for performance decisions favoring a public
reimbursable provider. Where the performance decision favors the agency
tender, the contracting officer establishes a letter of obligation with
the official responsible for MEO performance.
Streamlined competitions
Procedures for streamlined competitions can mirror those required for
standard competitions. However, since streamlined competitions are
smaller in size and shorter in duration, less analyses and
documentation are required. For example, when the competed activities
are performed by 10 or fewer employees, the streamlined procedures do
not require a conversion differential showing a government savings of
10 percent of agency personnel costs or $10 million, whichever is less.
Further, agencies may:
* form an MEO;
* base its agency cost estimate on the incumbent organization; and
* establish a private-sector cost for performing an activity using
market research or solicitation of cost proposals in accordance with
the Federal Acquisition Regulation.
In addition to the final performance decision, the agency officials
certify the agency tender and private-sector costs. Unlike standard
competitions, Circular A-76 does not specify which agency official is
to make which certification. However, the circular does require that
each certification be made by a different individual. Also, the agency
allows the incumbent service provider to review the certified
Streamlined Competition Form prior to the public announcement of the
performance decision.
As with standard competition performance decisions, the contracting
officer implements the streamlined competition performance decision by
awarding a contract for performance decisions favoring a private-
sector, a fee-for-service agreement for performance decisions favoring
a public reimbursable provider, or a letter of obligation with the
official responsible for a decision favoring the incumbent provider.
For a private-sector or public reimbursable performance decision, the
contracting officer may issue a solicitation before a contract can be
awarded to a private-sector or public reimbursable service provider.
Post Competition Accountability: Regardless of the selected service
provider or the type of competition held, the agency tracks execution
of their competitions from the date of the public announcement through
either the completion or cancellation of the competition and maintains
a historical record of each competition. Best practices and lessons
learned resulting from the competition are posted on the Share A-76 Web
site.
During the performance periods following each competition, the agency
measures success and calculates savings by:
* monitoring performance against the performance work statement;
* recording the actual costs of performance; and
* comparing actual costs to those recorded on the competition forms.
At the end of each fiscal quarter, the agency submits a Competitive
Sourcing Quarterly Report to OMB. The report provides detailed
information for in-progress competitions (those pending performance
decisions) and completed competitions. Annually, the agency develops a
report detailing its competitive sourcing activities of the year and
the savings or quantifiable performance improvements derived from
implementing competitions completed under the revised A-76 process.
After an OMB review for compliance with Circular A-76 guidance, the
agency transmits the annual report to Congress.
To achieve a rating of ’green“ for its competitive sourcing on the
President‘s Management Agenda scorecard, the agency submits for OMB
review and approval its competitive sourcing plan. An essential
component of the plan is identifying, by fiscal year, through 2008,
which commercial activities the agency plans to announce for
competition. For each planned competition, the agency identifies the
activity (with the function codes and locations), number of FTEs
involved, fiscal quarter in which the announcement is expected to be
made, and the type of competition. The table shows OMB‘s standards for
measuring competitive sourcing success.
Table: Standards of Success for Competitive Sourcing:
Yellow: An agency will earn a "yellow" status when it has:
* an OMB approved "yellow" competition plan;
* completed one standard competition or publicly announced standard
competitions that exceed the number of positions identified for
competition in the agency's yellow competition plan;
* in the past 2 quarters, completed 75 percent of streamlined
competitions in a 90-day timeframe; and;
* in the past 2 quarters, cancelled less than 20 percent of publicly
announced standard and streamlined competitions.
Green: An agency will earn a "green" status when it has:
* an OMB approved "green" competition plan;
* publicly announced standard competitions in accordance with the
schedule outlined in the agency "green" competition plan;
* since January 2001, completed at least 10 competitions (no minimum
number of positions required per competition);
* in the past year, completed 90 percent of all standard competitions
in a 12-month time frame;
* in the past year, completed 95 percent of all streamlined
competitions in a 90-day time frame;
* in the past year, canceled fewer than 10 percent of publicly
announced standard and streamlined competitions; and;
* OMB-approved justifications for all categories of commercial
activities exempt from competition.
Source: OMB.
[End of table]
Our review of the science agencies‘ competitive sourcing plans found
that three agencies”EPA, Energy, and NASA”have approved ’green“ plans.
Commerce (NIST and NOAA) has an approved ’yellow“ plan.
Follow On Competition: By the end of the last performance period under
an agency or public reimbursable (fee-for-service) performance
decision, the agency must complete another streamlined or standard
competition, unless the competitive sourcing official grants an
exemption.
NASA Research Announcements - FY 2003 through FY 2005:
Advanced Component Technology Program Astrobiology: Exobiology and
Evolutionary Biology Astronomy & Physics Research Astronomy & Physics
Research & Analysis Astrophysics Theory Biological and Fluid Physics
Research for Human Support Technology Carbon Cycle Science Earth System
Science Research using Data and Products from TERRA, AQUA and
ACRIM Satellites
Engineering for Complex Systems Ground-Based Studies for NASA
Specialized Center of Research for the Estimation of Solid Tumor Cancer
Risks from Space Radiation Inspiring the Next Generation of Earth
Explorers; Integrated Solutions for K-16 and
Informal Education
Instrument Incubator Program Interdisciplinary Science in the NASA
Earth Science Enterprise Mars Fundamental Research Mission and Science
Measurements Technology Modeling, Analysis and Prediction Climate
Variability and Change NASA Research Announcement Soliciting Ground-
based Research Proposals Biomedical
Research and Countermeasures Program New Frontieres Progral STEP 1
New Investigator Program New Millennium Program Space Technology Oceans
& Ice Ocean Surface Topography/Science Team Planetary Data System Nodes
Research Opportunities for Flight Experiments in Space Life Sciences
Research Opportunities for Ground-Based Research in Space Radiation
Biology and
Space Radiation Shielding Materials Research Opportunities in Physical
Science Fluid Physics Research Opportunities in Physical Science
Fundamental Physics Research Opportunities in Space Biological
Sciences, Advanced Human Support
Technology Program
Research Opportunities in Space Life Sciences, Fundamental Space
Biology,
Ground-based Research
Research Opportunities in Space Science 2003 Research Proposals for
NASA/ESA/CNES International Long-term Bed Rest Study Research Proposals
for Using Ground-based Analogs of Space Flight Research Opportunities
Soliciting Ground-Based Studies for Human Health in Space Research
Opportunities Soliciting Ground-Based Studies for Radiation Biology and
Radiation Shielding Materials
SEC Theory Small Explorers
TPF/Coronagraph Instrument Tropical Cloud Systems and Processes (TCSP)
[End of Briefing]
Enclosure II: Comments from the Department of Commerce:
United States Department Of Commerce:
National Institute of Standards and Technology:
Gaithersburg, Maryland 20899-:
Office Of The Director:
March 9, 2007:
Memorandum For:
Allen Li:
Director, Acquisitions and Sourcing Management:
From: James Hill:
Acting Deputy Director:
Subject: Comments on Draft Report on A-76:
Thank you for the opportunity to comment on the draft Government
Accountability Office (GAO) report "Implementation of OMB Circular A-76
at Science Agencies."
Attached are the Commerce Department's comments.
attachment:
Technical and factual comments on the GAO Report entitled "Contract
Management: Implementation of OMB Circular No. A-76 at Science
Agencies"
Page 1, first paragraph:
The report states that according to Commerce officials, "language in a
conference report (House Report 108-010) prohibited NIST from competing
activities under Circular A-76." It was not the, Department's intention
to imply that the report itself prohibited competitions but rather, as
GAO explains later in the report, that NIST was to provide the .
Committees on Appropriations a detailed plan prior to implementation of
competitive sourcing.
NIST prepared the detailed plan called for in this report. It was
transmitted to chairmen and ranking minority members of both the House
and Senate Appropriation Subcommittees for NIST on November 28, 2003.
The report laid out a plan for NIST to study the activities of seven
administrative and support organizational units for commercialization.
The activities performed by the seven organizational units under review
required 308 federal positions and represented a total of 18.9% of
NIST's FAIR Act Inventory at that time, exceeding the President's
target of 15 percent of "commercial activities," NIST also took steps
to procure the services of two expert contractor firms familiar with
the A-76 process to help in the studies, undertook streamlining of a
variety of administrative support activities, and prepared to support
the NIST employees with professional services in the downsizing that
might take place. NIST made it clear in the plan that it intended to
support the President's Management Agenda.
In consultation with the Department of Commerce, NIST did not compete
any commercial activity because of the absence of guidance from the
Congress after transmittal of the NIST Plan. Also, language in the
Senate FY 2004 Appropriation Committee Report directed NIST to consult
with the Appropriations Committees before proceeding with competitive
sourcing efforts and to refrain from using appropriated funds for an A-
76 effort.
It would be more accurate to state that NIST, in consultation with
Department of Commerce, did not compete any commercial activities
because of this absence of guidance and need to consult with the
Appropriations Committees before proceeding to use appropriated funds
for A-76 efforts.
Page 5, chart:
The chart on page 5 shows the availability of commercial activities for
competition by FTE range. This is absolutely critical in explaining the
relatively low number of competitions overall. With over 86 percent of
commercial activities involving ten FTEs or less, the return on
investment for study costs for these small groups can be minimal.
Page 6, paragraph 3:
It would be more accurate, and consistent with the requested changes to
page 1, to simply state that feasibility studies are being conducted,
and strike out the rest of the sentence from "are being done." This
would also be more consistent with the rest of the paragraph on the
conference report language.
General comment:
Finally, for historical and planning purposes, the report shows that
when competitions are held, significant savings can be expected. In
this regard, we were also glad to see cost savings data from studies
for organizations in addition to DOD.
[End of section]
Enclosure III: Comments from the National Aeronautics and Space
Administration:
National Aeronautics and Space Administration:
Headquarters:
Washington, DC 20546-0001:
Reply to Ann of:
Office of Procurement/Analysis Division:
Mr. Allen Li:
Director:
Acquisition and Sourcing Management:
United States Government Accountability Office:
Washington, DC 20548:
Dear Mr. Li:
The National Aeronautics and Space Administration (NASA) has reviewed
the draft GAO report entitled "Contract Management: Implementation of
OMB Circular No. A-76 at Science Agencies" (GAO-07-434R) and thanks you
for the opportunity to provide comments.
The report contains no recommendations for NASA. The technical comments
NASA provided at the exit conference held on January 10, 2007, have
been incorporated into the draft report. Therefore, NASA has no
additional comments.
If you have any questions or require additional information, please
contact me at (202) 358-2090.
Sincerely,
Signed by:
Tom Luedtke:
Assistant Administrator for Procurement:
[End of section]
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