Senate Looks Likely to Support Easier Outsourcing at the Pentagon

Lawmakers and federal employee advocates are pushing back against legislation that would ease the process of outsourcing at the Defense Department, but so far have made little progress in maintaining an obstacle to contracting out government functions in place since 2010.

A provision of the annual Defense Department authorization bill would repeal a prohibition on public-private competitions to determine whether contractors should perform functions currently fulfilled by federal civil servants. The potential conversions, known as A-76 privatization studies for the Office of Management and Budget memorandum that originally authorized them, were revived early in the President George W. Bush administration, but Obama signed a law prohibiting the practice.

The ban was scheduled to last as long as it took for the Pentagon to conduct a census on exactly how many contract workers it employed and the nature of their job functions, but Defense has yet to issue such a report. A provision of the fiscal 2017 authorization bill would remove the prerequisite for that report to be completed before resuming the competitions and subsequent outsourcing.

Sens. Brian Schatz, D-Hawaii, and Sherrod Brown, D-Ohio, introduced an amendment to keep the competitions ban in place, but it did not receive a vote during debate on the larger bill last week and proponents do not expect it to come to the floor before the expected final passage this week. The International Federation of Professional and Technical Engineers and the American Federation of Government Employees have rallied their members to lobby their senators to support the amendment, which has picked up 15 cosponsors -- including three Republicans.

“It is looking like the language [allowing competitions to resume] will remain in the bill, unfortunately,” conceded Matt Biggs, IFPTE’s legislative director. “However, this is obviously an issue we will work with Sen. Schatz and others on going into conference.” The House-passed version of the Defense bill does not contain language allowing the re-institution of the outsourcing procedure.

The White House also objected to the provision, saying in its veto threat of the defense policy bill the lift on the competition moratorium was premature.

“OMB continues to work with DoD and other agencies on efforts to ensure the most effective mix of federal employees and contractors and believes more time is needed for efforts to ensure core in-house capabilities for critical functions before the moratorium is lifted,” the White House wrote. The administration has voiced a series of objections to the bill.  

Congress prohibited the public-private competitions in the fiscal 2010 defense authorization bill after the Pentagon’s inspector general and the Government Accountability Office both found the process contained system disadvantages against the federal workforce. The reports also found Defense was not using complete and reliable data in determining the most cost-efficient option between federal employees and private contractors.

In denouncing the measure, IFPTE called the rollback “extremely important to all civilians” at the Defense Department. The Professional Services Counsel, meanwhile, which represents hundreds of federal contracting companies, has supported an end to the ban on A-76 competitions, calling them a “tool in the toolbox” agencies should have to drive efficiency.