MAA management is slack, GAO concludes

GSA administrator Stephen A. Perry says GSA will establish realistic schedules for completing MAA transitions.

The slow shift to the General Services Administration's local telephone contracts has cost agencies millions in unrealized savings, the General Accounting Office says.

Problems within GSA'some beyond its control'have delayed the lower prices expected from the Metropolitan Area Acquisition program, GAO reported last month in a study requested by the House Government Reform Subcommittee on Technology and Procurement Policy.

Only five of 19 cities scheduled for MAA transition by March 1 have completed the changeover. GAO recommended that GSA work faster to eliminate holdups.

GSA's Federal Technology Service three years ago began awarding competitive MAA contracts in selected cities, and 23 cities now have the pacts in place. GSA estimated the potential savings at more than $1 billion over eight years.

But only two cities, Buffalo and Cincinnati, finished their changeover to the new contracts on time. Boise, Idaho, Minneapolis and St. Louis have since completed their transitions.

In Miami, in transition for the past 20 months, only 4 percent of government users are tapping MAA services.

Half haven't switched

Overall, as of March 1, MAA contracts were serving only 52 percent of potential users; about 77,000 had yet to switch over, GAO found. It estimated those users could be spending as much as $1.1 million extra per month as a result.

GSA plans to establish realistic schedules for completing MAA transitions and developing performance measures, GSA administrator Stephen A. Perry said.

Some delays resulted from inadequate GSA staffing and some from agencies unprepared for the switchover, GAO found. Atlanta, Miami and New York agencies encountered disputes about access and ownership of in-building equipment.

Transfer of telephone numbers was a problem in some markets, and one contractor, Winstar Communications Inc. of New York, declared bankruptcy.

Service fees not disclosed

But even in cases beyond GSA's control, GAO faulted it for inadequate management and for not disclosing service fees.

FTS, which is funded by fees from its government users, imposes an MAA contract fee and an optional full-service fee for handling billing. Fees, ranging from 8.6 percent of the service cost in Cleveland to 97 percent in New York, are mingled with the overall line charges.

GSA responded to GAO that it does not break out its fees in prices presented to agencies because it wants them to focus on the overall line costs.

GSA's Perry said his agency will publish a simplified fee schedule by October itemizing its fees.

GAO did not criticize the size of the fees, however.

In New York, where FTS' monthly fee totals $3.75 per line, the contractor's line rate is just $3.85, so the FTS fee is almost half of the total. But the $1.85 monthly fee in Cleveland is far lower in comparison with the contractor's line rate there: $21.33.

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