FAA undertakes acquisition reforms

The Federal Aviation Administration recently implemented procurement reforms aimed at stemming mismanagement of services contracts.

Under the new acquisition procedures, outlined by Administrator Marion Blakey earlier this month in an internal memorandum to FAA managers, contracting officials no longer are permitted to award support service contracts worth $1 million or more on a sole-source basis unless they receive permission from the agency's deputy administrator. The FAA's chief financial officer must approve requests to buy services worth more than $10 million, and program and contracting officers must undergo "mandatory, in-depth" training on procurement integrity.

The revised procedures are part of an effort to "avoid unnecessary, improper or avoidable expenditures on outside services" at a time when the FAA is being asked to do more with "fewer resources and a declining aviation trust fund," Blakey said. The changes are the first in what may be a series of modifications as a team of officials directed by acquisition executive Dennis DeGaetano analyzes the FAA's approach to buying services, she said.

Two senators have backed the FAA's efforts. "Support service contracts . . . should be scrutinized to ensure that every dollar is spent as intended and [is] not subject to fraud, waste or abuse," Sens. Charles Grassley, R-Iowa, chairman of the Finance Committee, and Tom Coburn, R-Okla., head of the Homeland Security and Governmental Affairs Subcommittee on Federal Financial Management, wrote in an Aug. 17 letter to Blakey.

The FAA uses outside companies to provide more than $1.3 billion in support services, which range from software development to consulting work, Blakey wrote in her memo. Such contracts are often awarded under one of three umbrella agreements, for which some contractors have pre-qualified.

"These umbrella agreements, when administered correctly, can be very helpful," Blakey said, because they expedite the procurement process and "cut down on unnecessary bureaucratic review."

"But it is also important to emphasize that we must always get the job done right, which means adhering to the highest possible ethical standards and being responsible stewards of the taxpayers' money," Blakey wrote.

The revised procedures call for all sole-source solicitations to be "held to a higher standard." Statements of work must be "very specific" and the rules will apply "not only to the contracts themselves but also to task, delivery and work orders under any of the umbrella agreements, as well as to modifications expanding the scope of a support services contract," Blakey wrote.

"Taken as a whole these reforms present an opportunity for the FAA to exercise greater financial and managerial control over support service contracts," Grassley and Coburn wrote. "However, there are significant differences between recommending reforms and implementing reforms."

The senators asked Blakey to provide them with a timeline on when the changes would take effect and statistics on support service contracts. FAA spokesman Greg Martin said that the reforms outlined in the memo already have been implemented.

Agency officials are aware of the senators' request, but Blakey has yet to receive a copy of the letter, Martin added. Once it arrives, the FAA will "respond . . . in due course and directly," he said.