Agencies adjust to new A-76 rules

Former OMB director Mitchell E. Daniels Jr. says he expects many competitions under the new rules to be completed in 30 days or less.

Following initial reactions to the recent release of the revised OMB Circular A-76'whether exuberance or anxiety'agency officials are getting down to business to figure out how the new rules affect their plans to outsource jobs.

The Defense Department is one of the largest users of the circular. It plans to compete more than 67,800 positions by October.

At the Energy Department, officials must decide how to proceed with 420 IT positions they are considering opening to competition.

'Once we get the timeline sorted out for our existing or planned studies, I think the new circular will work fine,' said Dennis O'Brien, director of Energy's Competitive Sourcing and A-76 Office. 'The challenge will be developing the procedures to get studies done in the 12- to 18-month time frame.'

Other officials who are much newer to the A-76 process said they are trying to understand how to construct the management and technical infrastructure to compete positions with the private sector.

Several agency A-76 officials said they were pleased with the revision [GCN, June 2, Page 9]. 'We think it is an improvement and offers a fresh start to a process that everyone said had become uncomfortable with respect to how long it took and its adversarial nature,' said Joe Sikes, DOD director for competitive sourcing and privatization.

'It is good that it follows the Federal Acquisition Regulation rules more closely,' Sikes said. 'The trick now is to make it work like it is intended to.'

OMB officials said the changes will save money and improve agency efficiency.

'Typically, these competitions end up saving the taxpayer about 30 percent no matter who wins,' said former OMB director Mitchell E. Daniels Jr. in late May, just before he stepped down from his OMB post. 'When competition replaces a monopoly, the public is served better. This new circular is the culmination of a thoughtful process.'

Must-do initiative

Daniels said the revised circular is one of the pillars of the Bush administration's promise for better management under the President's Management Agenda.

'The competitive sourcing process is going too slowly,' Daniels said. 'We need to accelerate it, and this improved process and additional management attention will do just that.'

Agencies 'no longer have a legitimate excuse' of not meeting the administration's September 2004 goal of competing 50 percent of all positions possible for spinning off, Daniels said. He added he expects a high percentage of competition under the new rules will be completed in 30 days or less.

OMB laid out a maximum 12- to 18-month time frame to complete competitions under the new circular.

But agencies have backed away from their willingness to identify jobs as candidates for competitive sourcing. Though the administration thinks about 850,000 jobs should be competed, agencies tagged 500,000 of those as inherently governmental and not good outsourcing possibilities.

Plus, unions still are balking at the rule changes. Despite some optimism, there is a lawsuit from the National Treasury Employees Union that questions the circular.

John Threlkeld, legislative representative for the American Federation of Government Employees, said the revision is slightly better than the draft OMB released in November, but his union still thinks the administration is seeking to dump jobs and move them to the private sector. This meshes with responses to a new GCN survey in which feds voiced similar opinions.

'We held out some hope in November that OMB would reform some of the worst tendencies of the draft revision,' Threlkeld said. Office of Federal Procurement Policy administrator Angela Styles 'said she was attentive to our concerns, but we don't think we will ever agree that she addressed our concerns.'

AFGE is worried that agency employees will not receive additional resources needed to participate on par with vendors in A-76 competitions, Threlkeld said. The union also is concerned that subjective factors will be used to evaluate best value, leading officials to skew A-76 reviews in favor of vendors.

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