The Navy has decided to contract out fuel supply services in the Norfolk, Va., area, after a 107-employee in-house team in charge of such services lost a public-private competition to a private firm.
The fuel department at the Fleet and Industrial Supply Center in Norfolk lost the competition to Trajen, Inc., of Bryan, Texas late last month. The affected employees can appeal the decision if they believe the award was not correct.
Dozens of similar competitions, governed by Office of Management and Budget Circular A-76, are underway throughout the Defense Department. The Pentagon plans to put more than 200,000 civilian positions up for A-76 public-private competitions through 2003.
The Naval Supply Systems Command, which runs the Norfolk supply center, is conducting a total of 15 A-76 competitions, with 800 jobs on the line. Since the Navy began the A-76 process, the command has completed four competitions, including the one for fuel services at Norfolk. A government team won one of the competitions; the other three have gone to private firms. The government teams have appealed the decisions in the previous two competitions that the private sector won.
Commander Walt Paskey, who oversees the command's A-76 competitions, said the Norfolk competition began in July 1997. The command took seven months to develop a performance work statement for the fuel services. Then, as contractors prepared their bids, the government team developed a management plan, known in the A-76 process as the "most efficient organization" plan. The plan is essentially a bid for the contract, showing the lowest costs the government would pay for the service if government employees continued to perform the work.
Two contractors submitted bids last summer. Then the command compared the contractors' bids with the fuel department's most efficient organization plan. Fuel services could be performed less expensively by a private sector firm, the command decided.
"The government tends to win more sophisticated procurements. With more labor-intensive procurements, industry has tended to win," Paskey said.
The supply center in Norfolk will help the fuel department employees find new jobs. The employees also have first right of refusal on job openings with the new contractor.
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