Comments on Senator Levin's Proposed Amendment to the Fiscal Year 1982 Defense Authorization Act

Gao ID: PLRD-82-14 October 20, 1981

In response to a congressional request, GAO presented its views on an amendment to the fiscal year 1982 Defense Authorization Act. The amendment would restrict the Department of Defense's (DOD) use of sole-source, noncompetitive contracting.

GAO agrees with the objectives of the amendment to restrict DOD use of sole-source, noncompetitive contracting. The section of the bill which would increase opportunities for competition has merit because it would require that offers be considered even when a sole-source award is anticipated. GAO is concerned that the provisions, which identify the circumstances under which contracts would be exempt from the requirements to publicize notices of prospective awards, are unclear and have the possibility of being misinterpreted as increasing the number of exemptions or as allowing noncompetitive procurement without a specific justification showing that competition is not feasible. Publication of proposed contracts for personal or professional services in an amount less than $500,000 would alert other potential sources and may illustrate that the proposed sole-source contractor does not have unique capabilities. Patent rights or proprietary information should not preclude the obtaining of competition since the government has authority to indemnify contractors against patent infringements. Competition for the award of contracts to nonprofit educational institutions should be sought, and GAO believes that, once the decision is made to negotiate an award, it need not necessarily be a sole-source contract. GAO believes that the amendment with the suggested revisions would increase the number of procurements that are publicized resulting in more contracts being awarded competitively.

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