Acquisition officials offer new details on share-in-savings proposal

Federal acquisition officials have added a new layer of detail to a proposal to allow agencies to pursue share-in-savings contracts for certain information technology projects.

The updated proposal, published Friday in the Federal Register, incorporates public comments on a draft rule issued last fall. The latest proposal comes as part of efforts by the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council to implement a section of the 2002 E-Government Act encouraging the limited use of share-in-savings agreements.

Such agreements are designed so agencies can acquire new technology without making large up-front investments. Under the approach, agencies offer contractors a cut of the savings they help generate.

Friday's draft rule expands on the acquisition councils' fall proposal by offering guidelines for writing share-in-savings agreements, developing business cases to justify use of the approach, and selecting companies offering the best value on share-in-savings contracts. The updated proposal also asks agency contracting officials to develop a collaborative relationship with other government officials involved in arriving at agreements and with industry, to "facilitate due diligence and mitigate risk."

The acquisition councils are taking their time arriving at a final rule, according to Angela Styles, former head of the Office of Federal Procurement Policy. "The timing is indicative of reluctance," she told Government Executive recently.

But the councils are "moving in the right direction," said Drew Crockett, a spokesman for Rep. Tom Davis, R-Va., chairman of the House Government Reform Committee. "This is a complicated area that requires judgment and innovative thinking to ensure the implementation is well thought out and carefully executed."

The councils "could have moved faster given the sunset provision on the authority," Crockett noted. The section of the E-Government Act that authorizes the limited use of share-in-savings contracts for technology projects is good through the end of 2005.

In late April, Davis introduced legislation that would allow agencies to enter share-in-savings contracts in areas beyond information technology. The bill would also eliminate the E-Government Act's sunset provision. But "given what's left of the legislative calendar and the general contentious atmosphere in Congress, it is not realistic to expect [the bill] to move as a stand-alone piece of legislation" this year, Crockett said.

The acquisition councils will accept public comment on Friday's draft rule through Aug. 31. Comments should cite ANPR FAR case 2003-008 and should be sent by e-mail to: farcase.2003-008@gsa.gov or by standard mail to: