The Army says it is just a few weeks away from awarding a contract to outsource a major logistics computer system. But the process has been stalled by complaints and appeals by employees and the Small Business Administration.
The Wholesale Logistics Modernization Program, or Log Mod, contract, involves the Army's first waiver of public-private competition rules. The rules, under Office of Management and Budget Circular A-76, give federal employees the chance to defend their jobs in competitions against private sector contractors.
The Army this spring decided to deny employees that opportunity and directly outsource the Log Mod program. More than 400 employees who maintain the logistics system will have to go work for the private sector contract winner or find new jobs.
Officials at the Army's Communications-Electronics Command who are overseeing Log Mod said they "are on schedule for award and are currently involved in discussions with offerors," though the officials in August had projected Dec. 10 as the contract award date.
Employees this summer appealed the decision to waive A-76 requirements to Army Secretary Louis Caldera. Caldera rejected the appeals this fall.
The Small Business Administration has also challenged the Log Mod contract, arguing that it is a bundled contract that should be broken up into smaller components so that small businesses have a better chance of competing for it. The Army rejected the challenge, but SBA spokesman D.J. Caulfield said the SBA plans to further challenge the proposal, which may delay contract award further.
"This continues to be an interagency communications on an open issue," Caulfield said.
Since the Army announced its decision to directly outsource the logistics program, 10 percent of the employees at the two software centers that run the program have quit (54 employees of about 500). The Army has offered buyouts and early retirement packages to remaining employees. In addition, the winning contractor must offer jobs to employees who want to keep working on the Log Mod program, under the Army's requirements for the contract.
"The contractor must offer a position with comparable pay and benefits to any displaced government personnel," Communications-Electronics Command officials said.