OMB Circular A-76

Flaws in Cherry Point Comparison Preclude Validation of Contracting Decision Gao ID: NSIAD-92-38 October 18, 1991

An 8-year study concluded that facilities maintenance, utilities, and motor transport functions carried out by 388 federal employees at the Cherry Point Marine Corps Air Station could be done more economically by a private contractor. Pending validation of the cost comparison by GAO, however, federal employees have continued performing these functions. GAO found that the government's decision was flawed because it relied on outdated work statements, there were inconsistencies between the specification format and the source selection plan format, and the contractor selected lacked relevant experience and understanding of critical work requirements. Accordingly, it is unclear whether the services could be done more efficiently by the contractor or whether estimated savings will be realized. The Marine Corps has been directed to further study its contracting decision before it decides whether to proceed.

GAO could not clarify whether services could be performed more efficiently by the contractor or whether savings estimates would be realized due to: (1) use of an outdated performance work statement that did not reflect changes in the work requirements; (2) a specification format that did not correspond to the source selection plan format; and (3) the contractor's failure to demonstrate acceptable, specific experience and comprehension in mission-critical work requirements.

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.

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