In the last issue of the GCA Report we reported on recent changes to the Office of Management and Budget Circular A-76 which is the principle guidance governing the way federal agencies go about determining whether a current activity should be performed by the public or private sector.  The revisions were primarily intended to streamline the way public versus private competitions are conducted to lesson the time and effort involved once an activity is identified as an outsourced candidate.  Since industry stands to gain from the greater outsourcing of goods and services currently provided by the government while federal workers stand to lose jobs if the changes are implemented several responses to the A-76 revision and outsourcing in general have become a hot topic.

(1)  GAO head David Walker testified to Congress the revisions’ emphasis on permitting greater reliance on FAR-based procedures and basing selection decisions on tradeoffs  between technical and cost factors were laudable.  He said there were “implementation challenges” including (1) difficulty in meeting the goal of 12 months from public announcement to performance decision (2) the streamlined cost comparison process for activities using less than 65 full time equivalents would lead agencies to arbitrarily split up functions to meet the 65 FTE threshold (c) the revisions that prohibit federal unions to challenge cost comparisons provided “less accountability” and (d) the new requirement that in-house awardees must re-compete every five years is inconsistent with contractors who need not re-compete.

(2)  Insisting the revisions to A-76 tilt the rules in favor of private contractors at the expense of federal employees, the House voted 220-198 for language prohibiting the use of funds to implement the May 29 revisions.  The amendment to funding the Departments of Transportation and Treasury will affect only a limited number of agencies while a more far reaching proposal was narrowly defeated.  The President has promised to veto the measure.

(3)  The Administration has informed Congress it is abandoning its initial government-wide goals for competitive outsourcing and is replacing them with customized agency-specific plans which are expected out soon.

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