House members passed, by a vote of 210 to 187, legislative language that would prevent federal agencies from using fiscal 2005 funds to run public-private job competitions under the terms in the Office of Management and Budget's May 2003 modification of Circular A-76. Administration officials issued the rewrite last year partly in an attempt to address concerns aired by federal employee unions.
But Rep. Chris Van Hollen, D-Md., and union leaders argued that the rewrite of Circular A-76 introduces significant inequities to competitive sourcing, a controversial management initiative aimed at allowing contractors to bid on thousands of federal jobs considered commercial in nature. Van Hollen introduced the language unraveling the Circular A-76 rewrite as an amendment to the fiscal 2005 Transportation, Treasury and Independent Agencies Appropriations Act (H.R. 5025), which passed Wednesday.
"I am not opposed to competitive sourcing," Van Hollen said in a press release. "But we must put a stop to the administration's ideologically driven agenda to benefit private contractors over federal employees and taxpayers."
The amendment wouldn't force agencies to revert to old, widely criticized rules on competitive sourcing, Van Hollen and union officials said. Instead, the amendment simply encourages OMB to once again rewrite Circular A-76, this time in a manner that addresses flaws in the May 2003 version, supporters said.
But Bush administration officials said that Van Hollen's provision would effectively bring the entire competitive sourcing initiative to a halt. White House advisers threatened to recommend a veto if the final version of the bill prohibits use of the May 2003 A-76 rules.
"The passage of this amendment is a slap to anyone interested in more efficient, higher performing government," said Stan Soloway, president of the Professional Services Council, an Arlington, Va.-based contractors association. Federal employees already win nearly 90 percent of public-private competitions, he noted. "Given that, it is remarkable that anyone could still claim the process is biased toward industry."
While the May 2003 A-76 Circular isn't perfect, Van Hollen's amendment doesn't address the flaws, Soloway argued. "The real problem [in competitive sourcing] lies in the lack of oversight and accountability in the process."
The May 2003 rules were good in that they prohibited agencies from handing over work to contractors without first holding a competition, said Colleen Kelley, president of the National Treasury Employees Union. But aside from that prohibition, OMB didn't make many improvements in the latest set of rules, she said.
"We're not enthusiastic about the old rules," said Matthew Biggs, legislative director of the International Federation of Professional and Technical Engineers. "But the old rules are far better than the Bush revision."
American Federation of Government Employees officials said they would like to see a rewrite of Circular A-76 that officially eliminates a provision requiring in-house teams prevailing in competitions to re-compete for the work at regular intervals; forces contractors to compete for new work--not simply for existing jobs; grants in-house employees the right to form teams and bid on work in public-private competitions of all sizes, at a cost advantage of 10 percent or $10 million; permanently forces agencies to track all costs of job competitions and the savings produced; and grants federal employees equitable rights to appeal competitive sourcing decisions outside the agency.
Lawmakers already decided to hold the Pentagon to several of these standards, union officials noted. For instance, fiscal 2005 Defense appropriations legislation forces the department to allow in-house employees to form teams in any contests involving more than 10 positions, and to grant those teams a 10 percent or $10 million cost advantage.
Previously employees enjoyed those rights only in standard-sized competitions with more than 65 jobs at stake. AFGE President John Gage said he would like to see Circular A-76 rewritten "along the lines the Congress has laid down this year for the Defense Department...in addition to addressing other points."
Kelley of NTEU said that if OMB rewrites Circular A-76 again, she would like to see language forcing agencies to engage in more stringent oversight of contractors. She also said she would like to see a provision allowing unions to represent federal employees in competitive sourcing appeals.
But critics argued that OMB crafted the May 2003 rewrite of Circular A-76 carefully, after considering input from a host of interest groups and the unions. Some of the suggested changes would prove detrimental, so there is no need to rewrite Circular A-76 again, according to opponents of Van Hollen's amendment.