A Unique Opportunity to Innovate for the American People

A previous blog noted with optimism, the establishment of the White House Office of American Innovation (OAI).  Creation of OAI marks a timely, strategic, and necessary effort to recommend policies and plans that improve Government operations and services. The Federal procurement process is a backroom function that underpins all the Government does to serve the American people. A well-functioning, innovative, and cost effective system holds great promise to reduce Federal expenditures and improve mission accomplishment for Federal agencies and the U.S. tax payer.

As was suggested, one avenue to a more effective acquisition system was for OAI to tap into the unfulfilled potential of GSA’s Multiple Award Schedule (MAS) program. Currently, the program is weighed-down by burdensome requirements that increase costs and reduce access to commercial innovations in services, products and ordering mechanisms.  Recognizing that individual agencies and policymakers already are exploring internet-based purchasing options that offer simple, rapid access to products and dynamic pricing, frankly, the time for reinvention of the governmentwide MAS program was yesterday.

The good news is that GSA has the authority, programs, and electronic platforms that can be restructured to deliver streamlined, web-based access and dynamic pricing to innovative commercial services and products.  Unlike some commercial platforms, the MAS can deliver these benefits, while still complying with the vast array of applicable Federal acquisition laws.  Moreover, it provides an ordered platform to safeguard procurement data, which, if not protected, may be of value to those who do not have the interests of the nation at heart.  This blog considers GSA’s broad acquisition platform as a powerful channel for government-wide change and innovation.

The Federal Property and Administrative Services Act of 1949 (Property Act) established GSA to streamline the administrative work of the Federal government.  The Property Act vested GSA with the authority to:

  • prescribe policies and methods of procurement and supply;
  • operate, consolidate, or arrange for the operation of warehouses and similar facilities; and
  • procure and supply personal property and non-personal services.

GSA is the only agency with authority to contract, across all types of services and products, on behalf of all government agencies, including the Department of Defense. [1]

GSA manages and operates its $45 billion plus, Multiple Award Schedule (MAS) program (which includes the Department of Veterans Affairs Schedules) pursuant to the Property Act.  In addition, the Competition in Contracting Act (CICA) expressly recognizes the program and states that it operates competitively. Indeed, CICA language is powerful, if not visionary, because, it vests GSA with the authority to establish separate and distinct policies and processes to manage the MAS program and promote streamlined acquisition.

Specifically, CICA defines “competitive procedures” to include MAS program procedures so long as (1) participation in the program is open to all responsible sources, and (2) orders and contracts under the MAS procedures result in the lowest overall cost alternative to meet the Government’s needs. Indeed, the law explicitly states:

[T]he term “competitive procedures” means procedures under which an executive agency enters into a contract pursuant to full and open competition.  The term also includes—. . .  (3) the procedures established by the Administrator of General Services for the multiple awards schedule program of the General Services Administration if—

(A) participation in the program has been open to all responsible sources, and

(B) orders and contracts under those procedures result in the lowest overall cost alternative to meet the needs of the Federal Government[.]

See 41 U.S.C. 152(3); see also, 10 U.S.C 2302(2)(C).

It is critical to recognize that MAS procedures do not have to comply with additional requirements of CICA, as do other acquisition programs because, at the risk of being redundant, the test of competitiveness is whether the program is open to all sources and results in lowest cost alternative to meet the Government’s needs.  Thus, the GSA Administrator has the authority to innovate MAS policies and procedures to increase efficiency, enhance competition, further access to commercial innovation, and achieve cost-effective, best-value solutions for customer agencies. It is unclear why the agency has not capitalized on this broad authority.

In addition to this authority, GSA has an array of web-based tools which can provide easy access to products and services (e.g., GSAAdvantage!, eLibrary). It can act today, to bring efficiency and innovation to commercial acquisition simply by making the following changes:

  • Innovate the MAS contracting process by reducing government-unique requirements, processes, and procedures.
  • Reduce and reform MAS terms and conditions to be consistent with commercial item contracting requirements (e. put commercial back in commercial item contracting). Remember, under the Federal Acquisition Streamlining Act, along with other agencies, GSA is supposed to be leveraging the use of commercial terms, conditions, products, and services to the maximum extent practicable.
  • Where it is able, for instance, in the commercial off-the-shelf (COTS) realm, accommodate dynamic pricing to facilitate near-immediate vendor engagement in the market and to promote the availability of innovation to the government. This approach would reduce compliance activities and costs.
  • Especially in light of the President’s announcement of OMB’s Comprehensive Plan for Reforming the Federal Government this week, identify and act on opportunities to collaborate with other agency platforms.
  • For detailed FAR Part 12 procurements, establish a ceiling price and negotiate salient terms and conditions up front at the contract level, but allow for competitive pricing at the task and delivery order level. This approach would enhance competition at the purchase and task order level, while eliminating time-consuming negotiation of static FSS contract-level prices.
  • Enhance web-based tools to improve customer buying experience and eliminate the data collection burdens now borne by contractors. Indeed, by aggregating the transactional data that it possesses in disparate locations, GSA could enhance its value by providing this data for analysis and management improvement.
  • Promote, enhance, and deliver acquisition training and professional development government-wide (e. GSA Expo 2017).

Too often, GSA takes a restrictive view of its authority.  The Federal Acquisition Regulations makes it clear that authority is broad and innovation is achievable.  FAR 1.102 states:

The vision for the Federal Acquisition System is to deliver on a timely basis the best value product or service to the customer, while maintaining the public’s trust and fulfilling public policy objectives. … In exercising initiative, Government members of the Acquisition Team may assume if a specific strategy, practice, policy or procedure is in the best interests of the Government and is not addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, that the strategy, practice, policy or procedure is a permissible exercise of authority.

Emphasis added.

In summary, given the above-cited statutory and regulatory provisions, the GSA Administrator has the authority to innovate MAS electronic tools, acquisition policies, and procedures to increase efficiency, enhance competition, and further access to commercial innovation.

Currently MAS policies prevent contractors from being as competitive in the Federal market as they are in the commercial market.  The GSA Administrator can change that!

[1] The Office of Federal Procurement Policy can, and has granted certain agencies authority to establish government-wide contracts for IT products and services.