Excessive Specifications Are Limiting Competition for IRS Special Design Tax Return Folders

Gao ID: GGD-82-61 March 24, 1982

GAO reviewed solicitations and contracts for the Internal Revenue Service's (IRS) procurement of special design tax return folders to identify restrictive conditions and specifications.

IRS buys significant amounts of paper folders annually and the folder specifications, which require manufacturers to use 14 point kraft paper with a minimum tear resistance of 920 grams and inward folding gussets, are more than necessary to fulfill IRS needs. The General Services Administration's (GSA) specifications for standard duty folders are much less restrictive but do conform to the standards developed by the Joint Committee on Printing (JCP). The paper industry works on a continuous basis with the JCP to establish specifications in such a way as to maximize competition on federal paper procurements. Production of folder paper with IRS specifications requires a special production run, and the high tear resistance requirement deters most companies from bidding. IRS received three responsive bids from the 30 companies solicited for the 1982 folder procurement. IRS program officials stated that the 14 point paper is necessary to ensure folder longevity and that folders with inward folding gussets are necessary because they pop open naturally when removed from the shipping carton. Both government and industry officials with whom GAO spoke agreed that IRS specifications are excessive and that the unique paper requirement contained in the specifications is unnecessary and is precluding many manufacturers from bidding. Further, officials also believe that the current gusset design is unnecessary and costly.

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: Johnny C. Finch Team: General Accounting Office: General Government Division Phone: (202) 512-7824


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