OMB looks to boost use of interagency contracts

Preliminary results of an Office of Management and Budget acquisition survey have prompted concerns that agencies may be creating their own contract vehicles when they could use arrangements already developed for use by multiple agencies.

As of a few months ago, there were 200 single-agency contract vehicles in use across government and 53 interagency contracts. Of the interagency vehicles, 12 were governmentwide acquisition contracts, dubbed GWACs, and 41 were multiagency contracts, known as multiple award contracts or MACs.

Paul Denett, head of OMB's procurement policy office, said Tuesday that combined, the contract vehicles surveyed are worth about $356 billion. Many are for professional and technical services and information technology, he said at the Government Contract Management Conference in Vienna, Va.

"We have to examine, do we need that many? Probably not," Denett said.

Rob Burton, associate administrator of the OMB procurement policy office, emphasized that the numbers are preliminary. He said agencies should have a good business case before they set out on their own to create contracting vehicles.

"As for the 200 agencywide contracts, we would expect to see a good business case explaining why it was in the taxpayers' best interest not to use an interagency contract vehicle," Burton said. "I'm guessing that there is not a good business case for all 200."

Burton said that some single-agency contracting vehicles, such as the Homeland Security Department's Enterprise Acquisition Gateway for Leading Edge contracts for IT services and the Navy's Internet-based SeaPort procurement service, provide services that could be purchased on the 53 interagency contracts.

OMB also wants to look at the growth of agency multiple award contracts. "Most people agree that interagency contracts are a valuable management tool that can be used to effectively leverage the government's buying power." Burton said.

There may be too many contracting vehicles overall, Burton added. That could hurt the Bush administration's strategic sourcing initiative, which requires agencies to analyze buying practices and negotiate better deals with vendors, he said.

"Some agencies are becoming real experts in certain types of procurement and [others] should take advantage of that expertise," Burton said. "We see a growing role for governmentwide strategic sourcing."

The preliminary survey found that 12 of the 41 MACs probably would be used outside the agency that established them less than 10 percent of the time, and 13 of the MACs were expected to be used outside the agency that set them up between 10 percent and 50 percent of the time. Only five of the MACs were likely to be used outside the agency where they originated more than half the time. For another 11, there was no information available.

A formalized approval process, similar to that for GWACs, should be required for the MACs, Burton said. GWACs are authorized by OMB and half of them are managed by the General Services Administration. Burton said a governmentwide group should look at the MACs to determine whether they are beneficial.

OMB is exploring the possibility of requiring periodic submissions of business cases to justify the creation and renewal of MACs, as is now required for GWACs, Burton said.