Government's top procurement officials scramble to award unprecedented amounts of contract funds.
It is either the best of times to be in the acquisition management field, or the worst. Chief procurement executives are being called upon to spend unprecedented amounts of taxpayer dollars from the American Recovery and Reinvestment Act in an abbreviated time period-an epic task the Obama administration believes will help turn around the entire economy.
The Recovery Act comes with its share of risk. During the next several years, agencies will award as much as $60 billion in recovery contracts, most often with an undersized and overburdened acquisition workforce that has languished for more than a decade. If the pressures of executing the largest stimulus in government history were not enough, chief acquisition officers understand that hordes of journalists, watchdogs and skeptics will be vigilantly studying their decisions. One embarrassing misstep could send CAO careers into a tailspin.
Despite the mounting pressure, procurement leaders are anxious to tackle the challenge, and they welcome an opportunity to shine a spotlight on their field. "In some ways the Recovery Act has raised the level of importance of having the acquisition professional involved in strategic decision-making," says Debra Sonderman, chief procurement officer at the Interior Department. "We've talked for years about looking at ourselves as business managers. . . . Those organizations that are bringing their acquisition folks into the process early are seeing the fruits of that in being able to plan effectively for how they're going to roll projects out and ensure we meet the requirements" of the Recovery Act.
The Recovery Act presents a wealth of opportunities and complications for the CAO community. On one hand, the acquisition workforce has been given an unparalleled level of responsibility to spend billions of dollars to improve the nation's long-term infrastructure, energy and education systems. Procurement personnel-often described as overworked and underappreciated-are likely to be stretched even thinner, but many see themselves at the center of a unique national effort. "For an acquisition person to see that the work they're doing can be a direct part of strengthening our country's economy is really a very big deal," Sonderman says.
On the other hand, the stimulus presents a host of complicated reporting and oversight challenges, the likes of which the acquisition community has not faced in years. The Office of Management and Budget, for example, is still issuing guidance on the data funding recipients will be required to track and report. Despite the incomplete directives, acquisition officials must move full steam ahead on disbursing Recovery Act funds.
"Our focus is on ensuring oversight, accountability and unprecedented transparency of the funds and how they are spent," says Craig Hooks, acting chief acquisition officer at the Environmental Protection Agency. "We must award funds quickly and efficiently while also ensuring that each project is closely monitored for progress and results."
In many cases, acquisition offices are attempting to pull together detailed information from a variety of data sources. Complicating matters even further, contracting officers will be responsible not only for their own reporting but for the information contract award winners submit. "We have to make sure we have the right people and well-trained people to monitor the contracts once they've been awarded to ensure performance, and that recipients are complying with their reporting," Sonderman says.
Senior acquisition officials say they view the stimulus more as an opportunity than as a challenge. The desire to ensure that Recovery Act money is spent wisely, Sonderman says, has led to increased communication across silos that often divide agency acquisitions. "It's a wonderful opportunity to strengthen collaboration between budget, acquisition, finance, the solicitor's office, program offices, etc., because we're all needing to work together to make decisions to move things quickly," she says.
While an influx of new money can be overwhelming, it also provides agencies a chance to address long-standing infrastructure problems. Interior, for example, owns and manages 160,000 buildings and structures. Deferred maintenance on these properties has become a major issue in recent years, Sonderman says. Recovery Act funds will allow the agency to accelerate progress on its five-year property maintenance and preservation plan.
The General Services Administration's Public Buildings Service, which also manages a massive property portfolio, is getting $5.5 billion in stimulus funds-a more than 500 percent uptick from its normal annual appropriations. "Clearly, we are getting a lot more money to spend this year than we would normally execute in the course of a year," says David Drabkin, GSA's acting chief acquisition officer.
Nevertheless, he says, GSA is not ramping up its hiring to deal with the boost in funding. "We can't," he says. "It's not possible to hire enough employees quickly enough with the experience they would need to do the work this year."
Agencies are handling this inability to staff up for the stimulus in different ways. GSA officials are aligning staff with resources and bringing back dozens of retirees. Interior will hire contractors to help with document preparation; the department also will rely more on intern programs. "In some cases we will have the interns do the more routine work and our current, more seasoned staff will do the Recovery Act projects, which can be more complex or, because of the need for speed, need to have more senior people who can be most efficient," Sonderman says.
At EPA, a team of managers have been designated to oversee Recovery Act activities. "EPA is leveraging its existing resources and processes in order to carry out implementation of the Recovery Act in an efficient manner," says Hooks, who is the agency's point person on Recovery Act issues. "EPA offices have adapted internal financial and management processes to expedite the flow of Recovery Act money to qualified grant recipients and contractors."
Despite the complicated resource and staffing challenges, Hooks is more than optimistic that his employees can carry out the administration's lofty goals for the stimulus. "I have no doubt that EPA's Recovery Act funds will be managed well and will protect and increase the number of green jobs, sustain communities, restore and preserve economic viability of property, promote scientific advances and technological innovation, and ensure a safer, healthier environment," he says.
Opportunity of a Lifetime
Chief acquisition officers understand they are on the leading edge of a tectonic shift in how the government purchases goods and services. For the first time in a generation, government appears ready to invest both the time and money necessary to improve the federal acquisition system.
The Obama administration has ordered the Office of Management and Budget to begin an in-depth review of procurement efforts, from the outsourcing of work historically performed by federal employees to strengthening agency contract management and oversight. President Obama recently signed the largest legislative overhaul of Defense weapons acquisition policy in a decade. And a consensus appears to be building at the White House and on Capitol Hill that something must be done to build up the acquisition workforce.
The shortfalls in acquisition staffing are well-documented, particularly at Defense.
Pentagon contract spending ballooned from $138 billion in 2001 to $396 billion in 2008-with more than half devoted to services. During this same period, the size of the department's acquisition workforce remained flat. These staffing shortages are frequently cited as a primary cause of high-profile acquisition failures and repeated cost and schedule overruns on the department's major procurement programs.
On April 6, Defense Secretary Robert Gates announced plans to hire 20,000 procurement officials before fiscal 2015, restoring the size of the acquisition workforce to its 1998 level of 147,000. Shay Assad, the director of Defense Procurement and Acquisition Policy, calls the move "the first significant growth [in the acquisition workforce] since the military buildup in the 1980s and the downsizing that occurred during the 1990s."
The decision to beef up in-house acquisition capabilities, Assad says, will improve the department's ability to ferret out waste and combat contracting fraud. The positions Defense will be adding include contract pricing and program estimating personnel, program managers and auditors.
"The objective is straightforward," Assad told the House Armed Services Committee in late April. "To ensure DoD has the right acquisition capability and capacity to produce best value for the American taxpayer and for the soldiers, sailors, airmen and marines who depend on the weapons, products and services we buy."
The Obama administration's fiscal 2010 budget proposal also would give the Coast Guard funding to hire an additional 100 contract managers. The increase would bring the service close to its goal of building a 1,000-person acquisition workforce to manage its massive fleet modernization program. "That's as much an investment in our future as are the capital assets," says Rear Adm. Gary Blore, assistant commandant for Coast Guard acquisition. "Those 100 people will be doing good things for the Coast Guard for decades."
Drabkin says GSA has 100 to 150 vacancies in its acquisition workforce, including contracting officer representatives, technical representatives and program managers. "Within GSA that is quite a few people," he says.
Meanwhile, EPA recently benefited from a "long-awaited hiring spike," Hooks says. The agency's office of acquisition management is budgeted for more than 265 full-time staffers and as of late April had only 10 vacancies. The agency still is facing the long-term challenge of maintaining a well-staffed acquisition office, he says, "given the large numbers of employees eligible for retirement within the next five years, as well as the well-known governmentwide shortages of personnel in this discipline."
The agency is one of three federal participants in a task force led by the nonprofit Partnership for Public Service aimed at improving recruitment, hiring and retention of entry-level acquisition employees. Hooks hopes the initiatives can be replicated across government.
The deep economic recession and wide-scale unemployment have boosted retention and hiring at Defense, Assad says. Despite this improvement, he says it is crucial that the department begin implementing a "targeted, long-term employee retention and talent management strategy to retain acquisition employees with expert knowledge in critical and shortage skill areas." These positions include program managers, engineers, senior contracting officers, life-cycle logisticians and cost estimators-all in short supply throughout government in part because of more lucrative opportunities in the private sector.
Life Goes On
With the Recovery Act and governmentwide acquisition reform threatening to shift the ground beneath their feet, chief acquisition officers must still manage their day-to-day operations and push ahead with a series of long-planned projects.
GSA is in the requirements development stage for an electronic procurement system that would eliminate the need for paper contracting documents. The agency expects to launch the project within the next year. An electronic system could ease the process of writing contracts, altering requirements and checking a host of compulsory online databases.
"It would do a lot of things that would allow contracting officers to spend more time thinking strategically," Drabkin says. "And then it would give us even more discrete data than we currently have about what we buy so that we could improve our strategic sourcing of the things we buy [for ourselves] and the things we buy for our customers."
The Environmental Protection Agency is deploying its Federal Acquisition Circular Certification Program for contracting officer technical representatives, program managers and project managers. The agency has approximately 5,500 COTRs who require training, registration in an automated tracking system and certification. Also, the agency will conduct the first test run of its long-awaited e-acquisition system in June; the project will go live agencywide in the first quarter of fiscal 2010.
Interior, meanwhile, is deploying a comprehensive financial and business management system designed to integrate business operations across offices and bureaus. "Interior is an old agency, we're celebrating our 160th anniversary," Sonderman says. "Bureaus are highly independent with very diverse missions, so it's a challenge to be able to have an enterprise system that can meet the needs of such a diverse set of business lines."
While their challenges are by no means homogenous, CAOs are all bracing for significant change as the Obama administration ramps up its acquisition reforms and the stimulus funds begin to take seed.
"I see this as an opportunity to strengthen the acquisition community," Sonderman said. "It's a wonderful learning experience for people who are newer in the profession or who are coming from intern programs to really get deeply immersed in a lot of things fast."