OMB publishes guidelines on emergency procurement authorities

The Office of Management and Budget on Tuesday issued guidelines aimed at preventing abuses of emergency procurement authorities granted to agencies involved in hurricane relief efforts.

The guidelines restrict the number of employees to whom the heightened micropurchase threshold of $250,000 set in last week's $51.8 billion supplemental hurricane relief package applies. Micropurchases are generally made using government-issued credit cards, and some lawmakers had expressed concern that the higher limit could be abused.

The guidelines also require purchase-card holders to ensure that they pay a "reasonable price" for relief supplies or services, and that they buy from local small businesses where possible.

"By cutting the red tape on contracts less than $250,000, we can help get food, water and housing to [hurricane] victims as soon as possible," said David Safavian, administrator of OMB's Office of Federal Procurement Policy, in a statement. "At the same time, this guidance helps . . . ensure that taxpayers' dollars are spent efficiently and responsibly in support of disaster victims."

But the guidelines failed to reassure some critics. "They're not bad suggestions but I don't think they're going to fix anything," said Danielle Brian, executive director of the Project on Government Oversight, a Washington, D.C.-based watchdog group. "They've created a small monster with the dramatic increase in the threshold."

The procedures require agency heads or a delegate "no lower than the head of the contracting activity" to write lists of employees authorized to use the $250,000 threshold. To make the list, officials must be "working directly on Hurricane Katrina-related acquisitions."

"There will be no blanket increase of cardholder authority," Safavian and OMB Controller Linda Combs said in the guidelines.

Any purchase of more than $50,000 must be pre-approved by a separate warranted contracting officer or manager at the GS-14 level or higher. All spending under the emergency threshold will be subject to follow-up reviews, which must occur within 60 days of the transaction.

Brian of POGO praised the pre-approval requirement as the most significant provision in the guidelines. But the follow-up reviews would catch problems too late, she said.

Safavian and Combs reminded officials that the Stafford Act, which governs disaster relief efforts, "establishes a preference . . . for contracting with local organizations, firms or individuals for debris clearance, distribution of supplies, reconstruction and other major disaster or emergency assistance activities." They also encouraged agencies to reiterate the importance of following procurement ethics rules, and the penalties for violations.

The General Services Administration plans to issue supplementary guidance that will clarify legal restrictions on micropurchases and will give agencies more details on what kinds of purchases count as directly related to the Hurricane Katrina relief efforts.