Defense will base revisions to A-76 process on panel's plan

GCN Photo by Olivier Douliery

'DOD can benefit from a lot of these changes,' OFPP's Angela Styles says.

The Defense Department this summer will issue a plan to improve competitions for privatizing federal programs under OMB Circular A-76.

The plan will draw on the 14 recommendations that the Commercial Activities Panel offered to enhance the current A-76 process governmentwide.

To adopt the changes to the acquisition process proposed by the panel, however, the department will have to use its internal administrative rule-making process and seek a legislative change from Congress.

Specifically, two items require statutory changes. One affects DOD, one all agencies.
DOD cannot, by law, use best-value criteria when comparing employee proposals under A-76 reviews.

The second recommendation requiring a law change would give government employees the right to protest decisions, said Angela Styles, administrator of the Office of Federal Procurement Policy.

Primarily policy

The coming DOD plan will build on policy changes made by Clinton administration officials.

'There is an existing interim policy from the last administration, and we need to update it under the direction of the new administration,' said Joe Sikes, DOD director for competitive sourcing and privatization. 'We didn't want to precede the report with the guidance. I imagine there will be a few specific things, but much of the guidance will be more policy issues.'

Between 1997 and 2001, DOD completed reviews of 45,000 jobs to see whether they could be done by contractors. It will study another 46,000 jobs by next year, making the department the largest user of A-76, Sikes said.

He categorized many of the panel's recommendations as solidifying management techniques, such as ensuring high-level buy-in or using governmentwide lessons learned, rather than as changing competitive processes. Sikes said strengthening conflict-of-interest rules and making sure there is consistency in reviewing proposals are two of the more substantial recommendations that the department will address in its plan.

Once it releases its plan, DOD will need to wait for Congress to OK the use of best value to pick a winning bidder instead of low cost.

A 20-year-old law, 10 U.S. Code 2461G, requires that Defense use low cost as the ruling factor in comparing government employees' proposals against private-sector bids. DOD has long used best value to evaluate vendors' bids, which are then whittled down to the proposal that will compete against government workers' for a project, Sikes said.

Sikes said he was unsure if the department's new plan would include how to use best value in A-76 studies or if another memo would cover that topic.

'I will include best value when I take the guidance up to my bosses, but I don't know if we will be able to work out all the details,' he said. 'We would like to make a quick statement on how we will implement some of the panel's recommendations.'

DOD also might ask Congress to approve a pilot that would let it incorporate best value into A-76 competitions, Sikes said. But support in Congress for DOD using best value in A-76 competitions is mixed, said a Capital Hill staff member.

Reps. Tom Davis (R-Va.) and Joel Hefley (R-Colo.) plan to hold hearings on the panel's report. Davis, the chairman of the House Government Reform Subcommittee on Technology and Procurement Policy, scheduled a hearing for June 20. Hefley, chairman of the House Armed Services Subcommittee on Military Readiness, will hold a hearing later this spring, too.

A group eye on DOD

OFPP's Styles said a new federal working group would keep DOD's limitations in mind as it integrates the panel's recommendations into the A-76 revision.

'DOD can benefit from a lot of these changes,' she said. 'The key will be how we structure the approach.'

Styles also said the administration would consider proposing a bill to change the law affecting DOD's ability to use best-value criteria in A-76 competitions.

For changes that don't require congressional action, Styles said, the working group would publish proposed changes in the Federal Register. After a 60-day comment period, OMB will publish final changes to the circular. Styles said she expected the process to take about a year, and that OMB would set up a pilot for the new methods after draft changes are published.

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