OMB issues guidance on "green" competitive sourcing plans

The Office of Management and Budget has asked federal agencies to craft plans for letting contractors bid on federal jobs from now through 2008.

The multiyear plans will help it decide which agencies deserve a "green" rating, or top marks in competitive sourcing, said OMB Deputy Director for Management Clay Johnson in a Dec. 22, 2003 memorandum announcing the planning exercise. He added that OMB would evaluate plans based on how well they support an agency's mission.

"OMB will assess a plan's effectiveness in a manner that accounts for the agency's unique mission and workforce needs as well as the agency's demonstrated ability to conduct reviews and competitions in a reasonable and responsible banner," Johnson wrote in the memorandum, which was distributed to the President's Management Council.

The plans could serve as a window into how agencies would comply with the competitive sourcing initiative in a second term of the Bush administration, if the president is re-elected. Until now, most agencies have worked to implement OMB-approved plans to earn a "yellow" rating, which signals mixed results.

In the "green" plans, OMB expects agencies to craft a schedule for competing jobs deemed suitable for competition, a subset of the roughly 850,000 positions that by law could be performed by contractors. In an October report, OMB found that 434,820 jobs are ripe for competition.

But the agency will not require all of these jobs to be put on the auction block by 2008. In additional guidance included with Johnson's memorandum, OMB asked agencies to identify commercial jobs that will not face competition by 2008, and jobs where further analysis will be needed. Agencies must explain any cases where they plan to postpone competitions until after 2008.

OMB expects detailed information on competitions to be held in 2004, and more general information in following years. The budget office also wants agencies to update the plans each year, according to Johnson.

"Once an agency has developed an OMB-approved 'green' plan, it should update the plan by Aug. 1 of each year," he wrote. Johnson has said that agencies could lose their "green" rating if they fall behind on their plan or fail to meet other OMB criteria.

In its planning guidance, OMB does not ask for any cost estimates for conducting job competitions, a point noted by one union observer. "The guidance manages to ignore entirely the hot-button issues of contract administration and the significant costs of conducting privatization reviews," said John Gage, president of the American Federation of Government Employees. "Agencies are graded on the basis of how fast and how often they privatize, not whether their privatization decisions promote the interests of taxpayers and customers."

As they hold more job competitions, some civilian agencies have run up sizable tabs. In fiscal 2003, the Forest Service spent $18.2 million to stage competitions, and another $4.5 million to train its workforce on the competition process.

Johnson's memorandum gave no deadline for when "green" competition plans are due to OMB. The budget office did not respond to a request for comment on this issue or Gage's critique of the planning effort.