Agencies get new orders to report on costs, savings of job competitions

Contractor groups and federal labor unions welcomed requirements that federal agencies provide more information about their efforts to put federal jobs up for competition, while each group said it still faced significant disadvantages in such competitions.

An Oct. 15 memo from the Office of Management and Budget outlined additional requirements for agencies to report on their competitive sourcing practices passed by Congress last year. They include reporting on savings from competitions, costs associated with holding the competitions, the number of bids received and how the winning bid was chosen. Agencies must give Congress reports on their competitive sourcing efforts with this information for fiscal 2004 by Dec. 31.

Federal employee organizations and representatives of contractors said information about competitions and what it takes to win them are currently shrouded in mystery. "I'd love to know how many bidders there are, and when you don't have any, I would want to know why. It's almost impossible to find that out now," said Stan Soloway, president of the Professional Services Council, which represents companies that bid on government contracts.

"The number of bidders you get is an indicator of the quality of the competition," Soloway said, adding that the fact that most recent competitions have been won by in-house teams suggests a bias toward federal workers in the competition process.

Frank Carelli, director of government employees for the International Association of Machinists and Aerospace Workers, a member of the AFL-CIO, argued that federal workers face a significant disadvantage when bidding. "Federal employees just aren't trained enough to compete with contractors," he said.

Carelli called the new requirements a step in the right direction. "If the process is transparent, and federal employees understand what the process is, it will help them compete," he said.

The additional information, however, may also help contractors understand how the bidding process works and improve their chance of success in competitions, said John Threlkeld, a lobbyist for the American Federation of Government Employees. The reporting requirement is "clearly not something that is designed to help federal employees," he said.

Besides providing more information to those bidding on contracts, the revised procedures should also help Congress and the White House measure efficiency gains from competitive sourcing, said Richard Keevey, director of the Performance Consortium at the National Academy of Public Administration, a congressionally chartered independent organization to help improve government efficiency. "Congress wants to know, and OMB wants to know, the status of these competitions," he said.

Geoffrey Segal, director of government reform at the Reason Public Policy Institute, a pro-privatization think tank in Los Angeles, said more information will enable agencies to improve competitions: "With these rules, you will be able to see trends, and perhaps identify flaws in the system, that will enable you to further tweak and enhance the process."

Controversy continues to rage over calculating the costs of holding the competitions. In March, the National Treasury Employees Union said agency reports on such costs exclude expenses related to time spent by federal employees who work on the competitions.

The Oct. 15 memo instructs agencies to exclude costs of employees' time spent during regular working hours, but to include overtime pay.

"There are always going to be disagreements about cost comparisons," said Segal. "You could put procurement experts in a room for a week and you're not going to come up with a standard."