Unauthorized Commitments

In fiscal year 1979, the Department of Energy's (DOE) reported obligations made it the largest civil procuring agency in the Federal Government. The Federal Procurement Regulations, which govern most civilian agency purchases, give exclusive authority for establishing contracts to authorized contracting officers. However, DOE program personnel, who do not have contracting authority, have asked contractors to perform work. This circumvents established procurement regulations and eliminates the opportunity for competition. DOE has established special ratification procedures for entering into contracts after unauthorized commitments have been made. These procedures require a detailed account of why the commitment was made, reviews by the contracting officer and General Counsel, and approval by the head of the procuring activity. However, some offices have predated contracts or issued retroactive precontract authorizations instead of following DOE ratification procedures for unauthorized commitments.

Circumventing the normal procurement cycle will likely continue until DOE successfully eliminates the causes of unauthorized commitments. There are three major reasons for unauthorized commitments: (1) DOE program officials often fail to plan procurement needs far enough in advance to utilize normal contracting procedures; (2) program officials encounter emergency program requirements and do not believe that enough time is available to go through normal procurement procedures; and (3) program officials fail to expeditiously review, approve, and transmit procurement requests to the procurement office. Regardless of the cause, the Antideficiency Act is violated when DOE program officials make unauthorized commitments and accept voluntary goods or services from a contractor before funds have been appropriated by Congress. In addition, DOE Procurement Regulations do not contain the same restrictions as the Federal Procurement Regulations on ratifying improper commitments which would not be allowed by the Federal Procurement Regulations. While there may be instances where it is necessary to allow a contractor to begin work before a contract is established, unauthorized commitments are never an appropriate means of obtaining goods or services. DOE needs to establish a formal method of monitoring unauthorized commitments. Until it can accurately estimate how widespread the use of unauthorized commitments is, it will be difficult to attempt to eliminate them.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Team: Phone: