Lawmakers urge Defense to halt competitive sourcing

Key Democrats on the House Armed Services Committee on Friday asked the Pentagon to cease all public-private job competitions immediately.

Reps. Ike Skelton, D-Mo., chairman of the committee, and Solomon Ortiz, D-Texas, chairman of the panel's Readiness Subcommittee, urged the Defense Department to stop any pending competitions under the guidelines in Office of Management and Budget Circular A-76, refrain from initiating new contests and rescind a 2008 policy memorandum on competitive sourcing.

"This will allow the administration and Congress time to conduct a comprehensive review of the department's A-76 program and to determine the best course for moving forward with a sound competitive sourcing policy," they wrote in a letter to Defense Secretary Robert Gates. The congressmen sent a separate letter to OMB Director Peter Orszag, informing him of their request.

Competitive sourcing was a key component of the Bush administration's management agenda. The controversial policy was widely pursued at Defense, where the military services were encouraged to outsource work Bush administration officials believed could be done more efficiently by the private sector.

"Originally, the A-76 process was intended to be used as a tool to determine the most competitive and efficient source for performing 'commercial' work -- either in the public or private sector," Skelton and Ortiz wrote in the letters. "However, it became almost a mandate in recent years for pushing more and more work into the private sector, even work that is closely associated with inherently governmental functions, in order to meet arbitrary competition goals."

Federal labor unions and Democrats have long opposed public-private competitions, maintaining they often fail to deliver promised efficiencies and cost savings and unduly burden federal agencies. The 2009 omnibus appropriations act signed by President Obama earlier this month prohibits new competitive sourcing activity governmentwide through the end of the fiscal year on Sept. 30. But it does not prevent ongoing competitions. In their letter to Orszag, the lawmakers said they were concerned that the "competitive sourcing policies set in place in the 2001 President's Management Agenda are continuing to be fully implemented at the Department of Defense by the same official who advocated so strongly for such policies during the Bush administration."

Skelton and Ortiz cited 2008 Defense inspector general findings that Air Force officials felt pressured to conduct A-76 studies and that the Army was undergoing a number of efforts that affected competitive sourcing planning, such as war, base closings and an expansion. This created "undue burdens" on the services, the lawmakers wrote.

Many competitions "have dragged on far beyond the time limits authorized in the 2003 revised Circular A-76, as well as those imposed by statute," the lawmakers wrote. "This creates an unfair strain on the federal employees whose jobs are being competed, as well as the contractors who have submitted bids for the work. In many cases, an individual service has requested a cancellation -- either because the installation is seeking an alternative approach or because the original study was not appropriate -- only to be denied by the department."

In their message to Orszag, Skelton and Ortiz noted that their request is in keeping with President Obama's March 4 contracting reform memorandum. The president asked administration officials, including Gates, to establish a clearer definition of inherently governmental work by Sept. 30.