What’s Hot in Acquisitions? Presented to:

The National Association of Small Business Contractors and the U.S. Women’s Chamber of Commerce

August 5, 2009

Susan M.M. TruslowThe Office of Federal Procurement Policy

Office of Management and BudgetExecutive Office of the President

http://www.whitehouse.gov/omb/procurement_default

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OFPP’s Mission• OFPP was established by Congress in 1974 to provide overall direction for

government-wide procurement policies; OFPP’s statutory authorities and responsibilities are set forth in the Office of Federal Procurement Policy Act, 41 U.S.C. 401, et seq.

• The office is headed by an Administrator who is appointed by the President and confirmed by the Senate. There are currently 11 career staff.

• Overseeing the development of acquisition regulations and policies (FAR)• Formulating and coordinating acquisition legislation• Leading the activities of the Chief Acquisition Officers Council (CAOC)• Managing government-wide procurement data systems (FPDS-NG, CCR,

ORCA, eSRS, etc…)• Directing the activities of the Federal Acquisition Institute (FAI)• Promoting maximum participation of small businesses in government

contracting• Chairing and supporting the Cost Accounting Standards Board (CASB)

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Key Acquisition Data Points

• Between FY2000-2008, acquisition spending increased from approximately $200 billion to $535 billion.

• In FY2007, Contracts represented 41% of the government’s discretionary spending.

• More dollars are obligated under fixed-price contracts (60%) than cost-type contracts (40%).

• The government spends more of its dollars acquiring services than products by a ratio of about 3:2.

• Between FY2000-FY 2007, the level of competition has remained relatively constant at 64%.

• Prime contract dollars awarded to small businesses have increased– FY98 = $45.5 billion / 23%– FY07 = $83.3 billion / 22%

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Hot Topics• Recovery Act• Improving Transparency • Presidential focus on Contracting • Enhancing Competition• Enhancing Strategic Consideration of Contract Type• Strengthening the Acquisition Workforce• Managing the Multi-Sector Workforce • Contractor Integrity• Small Business Contracting

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Recovery Act• American Recovery & Reinvestment Act• Each agency has a Senior Accountable Official for Recovery• Guidance issued Feb 18, April 3 (www.recovery.gov) • Special requirements for Recovery Act contracts

– Information about contracts not fixed-price and non-competitively awarded must be posted on a special section of Recovery.gov

– Summary of all contracts, orders, and modifications over $500K must be posted on Recovery.gov

– Continued support of small businesses– Unprecedented Transparency and Accountability

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Improving TransparencyWe cannot overstate the importance of this effort. We are asking the American people to trust their government with

an unprecedented level of funding to address the economic emergency. In return, we must prove to them

that their dollars are being invested in initiatives and strategies that make a difference in their communities and across the country. Following through on our commitments

for accountability and openness will create a foundation upon which we can build as we continue to tackle the

economic crisis and the many other challenges facing our nation."

White House Chief of Staff and OMB Memorandum to Heads of Departments and Agencies, February 9, 2009

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Presidential Focuson Contracting

• March 4, 2009 Presidential Memorandum on Government Contracting – Signed within first 60 days in office, stresses importance of contracting to government

• June 18, 2009 Public Meeting – Feedback from the Public

• July 29, 2009– OMB Memorandum Improving Government Acquisition– OMB Memorandum Managing the Multi-Sector Workforce– OFPP Memorandum Improving the Use of Contractor

Performance Information• September – more to come

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Executive Orders• EO 13494 Economy in Government

Contracting

• EO 13495 Nondisplacement of Qualified Workers Under Service Contracts

• EO 13496 Notification of Employee Rights Under Federal Labor Laws

• EO 13502 Use of Project Labor Agreements for Federal Construction Projects

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Competition• By October 2009, the FAR will be amended to

strengthen the use of competition for task and delivery orders.

• The FAR will also be amended to limit the length of contracts that have been awarded noncompetitively due to urgency to one year.

• OFPP steps to maximize the meaningful use of competition and increase transparency:

– Reinvigorate the role of their competition advocates– Establish the CAOC Competition Working Group – Revise FPDS to clarify reporting on competition information

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Contract Type

• Guidance to address minimizing risk and maximizing value of government contracts in consideration of selecting contract type to meet agency needs

• Annual report to Congress by March 1 each year on cost-reimbursement contracting

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Acquisition WorkforceDevelopment Strategic Plan

Section 869 of the NDAA FY09: – Mandated the establishment of a

comprehensive strategic plan for acquisition workforce development in civilian agencies

– Must include methods for determining the appropriate size of the workforce

– Must identify sustainable funding models to support the hiring, retention and training of the workforce

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Federal Acquisition Intern Coalition www.fai.gov/faic

Retain skilled professionals

Attract new professionals

Career developmentShare knowledgeRecognize and reward

excellence

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Multi-Sector Workforce

• Guidance required on in/out sourcing within a policy framework

• Guidance and report due on inventory of federal and contracted functions

• Report to Congress on contractor inventory pilot

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Contractor Integrity• Federal Acquisition Regulation (FAR) amended to require

contractors disclose fraudulent behavior to agency Inspectors General.

• By the end of the summer of 2009, the FAR must be further amended to address personal conflicts of interest on activities that are closely associated with inherently governmental activities

• By October 2009, must establish an expansive database to be used in evaluating the integrity of potential government contractors and grantees.

• DOJ Procurement Fraud Task Force: http://www.usdoj.gov/criminal/npftf

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Small Business• The Small Business Act establishes policy that

small businesses “shall have the maximum practical opportunity to participate in the performance of contracts let by any federal agency, including contracts and subcontracts.”

• The Office of Federal Procurement Policy, in its Act, is also required to develop policies that ensure small businesses are provided with the maximum practicable opportunities to participate in federal procurements.

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Small BusinessRecent Important GAO decisions

Parity Among Small Business Programs• International Program Group, Inc., found that an agency must consider

HUBZones before considering small business set-asides for SDVOSBs.• Mission Critical Solutions, found that an agency must consider HUBZones

before considering small business set-asides for the 8(a) business development program. Also, If a contractor is in the 8(a) program and a follow-on contract can be set aside for HUBZone, the Agency must remove the Acquisition from the 8(a) program.

• OMB memo (M-09-23) regarding SBA parity regulations released July 10• STAY TUNED

Set-Asides Apply to Task/Deliver Orders under MACs:• Delex Systems, calls for agencies to apply small business set-aside

requirements to orders under multiple award contracts.

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Small BusinessWomen-owned Small Businesses (WOSBs)• In 2000, Congress authorized agencies to set-aside contracts for WOSBs in

industries in which the SBA determines that WOSBs are underrepresented or substantially underrepresented.

• In October 2008, SBA issued a rule implementing the program for setting aside contracts with women-owned small businesses. The rule required that an agency must make a determination that it has discriminated against WOSBs in the industry before setting-aside the requirement.

• The Bush Administration asserted that the agency determination of discrimination requirement is necessary to meet Constitutional standards of due process of law.

• The FY 2009 Omnibus Appropriations Act prohibits the Small Business Administration from using funds to implement the October 2008 rule.

• The SBA will resubmit a proposed rule to implement the WOSB program.

Price Evaluation Adjustment (PEA)• In November 2008, the Court of Appeals for the Federal Circuit, in Rothe

Development Corp v Department of Defense, found DoD’s statutory authority to provide a price evaluation adjustment is facially unconstitutional.

• Look for changes to FAR19.11 &19.12

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OFPPPoints of Contact

• Laura Auletta lauletta@omb.eop.gov– Competition – Environmental Contracting – Supply Chain Security

• Julie Basile jbasile@omb.eop.gov– Integrated Acquisition Environment Program

Mgr – Acquisition Data Mgr – Transparency Technology Team Mgr for

OMB • Jack Kelly jkelly@omb.eop.gov

– Federal Procurement Data System – Strategic Sourcing – Aircraft Management

• Karen Pica kpica@omb.eop.gov – Acquisition Workforce Management – Section 508 program

• Curtina Smith csmith@omb.eop.gov– Internal Controls and Implementation (A-123) – High-risk Contracting Oversight – Interagency Contracting

• Susan Truslow struslow@omb.eop.gov– Incentive / Award Fee Contracting – Small Business– Emergency Acquisition Policies – Purchase Cards

• James Wade jwade@omb.eop.gov– Program/Project Management

• Julia Wise jwise@omb.eop.gov– Acquisition Regulations Mgr – International Contracting – Chief Acq Officers Executive Secretariat – Performance-based Acquisition – Past Performance Policy

• Raymond Wong rwong@omb.eop.gov– Cost Accounting Standards Board – Tax Issues – Cost-type Contracting