Crime and reform? It's simply a matter of time and place

A recent front-page article in the Washington Post told of an investigation into the
procurement of printing services by a county government. It seems that 75 percent of the
county's printing business was going to a single vendor.


The investigators suspected that this company was not merely skillful or lucky but had
a well-placed friend. The county's printing manager was accused of giving the favored
contractor "advance information on its competitors' bids and [allowing] the firm to
revise its prices or submit late bids to win contracts."


Apparently, this is a violation of state law, and the accused public official may face
criminal charges. But he may be guilty of no more than simply working for the wrong
employer and being just a step ahead of the latest innovation in procurement practice.


A proposed revision to the Federal Acquisition Regulation would make this official's
actions legal and proper.


The proposed revisions would adopt simplified procedures for many commercial purchases.
Most information technology hardware and off-the-shelf software bought by the federal
government falls into the category of a commercial item.


The new rules are subject to a dollar limitation of $5 million per contract. This
ceiling is one hundred times higher than it was only a short while ago. It will
accommodate the purchase of virtually any commercial IT item and large volumes of most
items.


The proposed rules stake out radically new procedures for such purchases. They
explicitly permit previously prohibited auction techniques.


In procurements where price and technical factors are considered, which describes most
IT procurements, the rules would let the government indicate a price that an offeror will
have to "improve upon or meet, as appropriate, in order to remain competitive."


There is no doubt that this price could be the lowest price offered. The regulations
say that it can be "based on an evaluation of offers received." The only
limitation is that when "an offeror's price is used as the basis of negotiating with
other offerors, the identity of that offeror shall not be disclosed during
negotiations."


In other words, the contracting officer cannot say that this is the price proposed by a
specific company. But as the old proverb goes, a word to the wise is sufficient.


Moreover, it is not necessary to share this information with all the offerors. The same
proposed regulation states that information about what would constitute a competitive
price, which is given to one offeror, "need not be the same for all offerors."
In the same vein, the official description of the new rules says that they would give the
contracting officer the "flexibility" to "negotiate with one or more
offerors, as appropriate, but not necessarily all offerors."


And the problem of late bids can be easily solved under the new rules. Contracting
officers have no limit on the number of rounds of negotiation they conduct. They can
"repeat the process as necessary."


The problem of favoritism receives short shrift in the new regulations. Contracting
officers cannot "limit competition to suppliers of well-known and widely distributed
makes or brands." And they cannot "solicit quotations on a personal preference
basis." But once they have invited various companies into the competition, they are
under no obligation to treat them equally.


Indeed, the new rules explicitly expect that offerors will not be treated equally.


So it seems that the accused local official was simply in the wrong place at the wrong
time. The crimes he committed under state law will be accepted practice under the proposed
rules for simplified acquisitions by Uncle Sam.


Joseph J. Petrillo is an attorney with the Washington law firm of Petrillo &
Associates
.



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