Weighing In on Job Competitions

Determined to streamline the bureaucracy, the president declared that federal workers should compete for their jobs against private firms. Public-private competition, the president said, would help agencies operate in a more "economical and efficient manner." To put teeth behind these words, he set a numerical target: All federal agencies would open 3 percent of their jobs to competition with private bidders, following the rules laid out in Office of Management and Budget Circular A-76.

The president wasn't George W. Bush. It was Ronald Reagan. His goal, issued in November 1987, prompted some job competitions, particularly at the Defense Department. But it also spawned a backlash on Capitol Hill. The following year, Congress passed legislation that gave military base commanders the final say over all outsourcing at their installations. Conceived by the late Rep. Bill Nichols, D-Ala., the law was a lever for commanders to resist the 3 percent target.

"It helped them get out of doing competitions," remembers Joseph Sikes, director of competitive sourcing and privatization at Defense. In 1991, Defense canceled 394 A-76 competitions in less than five months. Other agencies stopped their competitions. Some consulting firms that specialized in A-76 went out of business. Under pressure from Congress, Reagan's drive for competition crumbled.

For veterans of the A-76 process, the Reagan effort fits a familiar pattern: With some fanfare, an administration launches an initiative to hold job competitions, promising savings and efficiencies. Congress, pressured by federal unions and constituents worried about their jobs, pushes back, setting limits on competitions or banning A-76 in select cases. In the 1980s, the Army Corps of Engineers had free rein to conduct job competitions in every state but one: Mississippi, home of powerful Democratic Congressman Jamie Whitten, who exempted Corps employees in his state from A-76.

As the Bush administration pushes its competitive sourcing initiative, lawmakers again are throwing up roadblocks-and winning some concessions in the process. In late July, then-federal procurement administrator Angela Styles said OMB would scrap all governmentwide targets for competitive sourcing, including the goal of opening 425,000 jobs to private bidders, a marker set by President Bush himself. The budget office also told agencies to include a line item for competitive sourcing in their fiscal 2005 budget requests, a nod to appropriators who want more information on the cost of running competitions.

But OMB has dug in its heels against legislation that would halt competitions. "People are going to try and pick these [competitions] off one by one," said Styles in June. "And we're going to fight every one of them. And we're going to fight them hard because this is a matter of principle." Bills to block competitions at the Interior Department and on a governmentwide basis have spawned White House veto threats. The administration also brokered a tough compromise on the Federal Aviation Administration reauthorization bill, allowing a competition involving 2,700 FAA employees to proceed.

It is also not clear that OMB's move to scrap broad targets will result in fewer job competitions. It seems to have had little, if any, effect so far. After her announcement, Styles went to a meeting of the President's Management Council, composed of the deputy secretaries of each Cabinet department. She told them that OMB was willing to renegotiate their initial competitive sourcing plans, designed when the White House was still prodding agencies to compete 15 percent of their jobs deemed "commercial" under the 1998 Federal Activities Inventory Reform (FAIR) Act. But few agencies took her up on the offer.

"I haven't had that many [agencies] come back in to talk," she said. "I think the agencies are pretty comfortable with their plans." Styles left her OMB post on Sept. 15.

Before leaving, Styles stressed that no agency has submitted a long-term competitive sourcing plan that meets OMB's new standards for "green," the top rating on its traffic-light style management scorecard. Under OMB's new criteria, agencies theoretically can get green lights for competing far less than half of their commercial jobs, provided they have OMB's approval. At the same time, OMB officials have said they still expect agencies to compete as many jobs as possible.

Agencies and OMB will decide in closed-door meetings which jobs will actually face competition, the same process they used before OMB dropped its targets.

But Congress will likely try to influence these competition plans as well, in part because of feedback from stakeholders that are new to the competitive sourcing debate. Thirty-eight environmental, labor and civil rights groups signed a letter backing legislation that would halt job competitions at the Interior Department. Federal employee unions are still the most active opponents of competitive sourcing, but these new groups carry influence with different lawmakers.

Lawmakers also have waded into the competitive sourcing debate to protect their constituents. To date, the most popular piece of anti-competitive sourcing legislation has been an amendment to protect two National Park Service offices from A-76. Introduced by Reps. Douglas Bereuter, R-Neb., and Allen Boyd, D-Fla., to the Interior appropriations bill, the measure would halt funding for studies at archeological centers in their districts; it passed the House by a vote of 362-57.

Sen. Robert Byrd, D-W.Va., has tried to protect Coast Guard and IRS employees in West Virginia from competition, and Rep. Lane Evans, D-Ill., has been a thorn in the side of the Veterans Affairs Department over A-76 for months. Evans, the ranking member of the House Veterans Affairs Committee, asked the General Accounting Office to investigate the VA's plan to put thousands of Veterans Health Administration positions up for competition.

In early August, another entity weighed in on competitive sourcing: local government. In Trinity County, Calif., the board of supervisors voted unanimously to ask the Bush administration to leave Forest Service employees in their county out of any job competitions. The Forest Service has 195 full-time employees in Trinity, and many more during the summer fire season, according to local officials. With a population of just over 13,000, Trinity can't afford to lose these workers, many of whom have families and are active in the community, says Robert Reiss, a county supervisor.

When told of the county's plans, Thomas Mills, deputy chief for business operations at the Forest Service, expressed sympathy for the county, but said the agency had no plans to exempt certain regions from A-76. "Forest Service employees tend to have higher paying jobs with better benefits, but they also participate in the community in other ways as well," he says. "We have not exempted any areas due to those concerns. We've got a responsibility to be the best steward of taxpayer dollars we can, and we have that obligation to everyone who receives our services."

The Trinity board voted to petition the Forest Service after hearing a presentation from Dan Duefrene, regional vice president of the Forest Service Council of the National Federation of Federal Employees. "They definitely recognize the added value we bring to the community," he says. In Montana, NFFE members have worked with community leaders to pressure the state congressional delegation to resist competitive sourcing. These union members believe their jobs are on the line, and they'll work with any elected official who can help.

In early September, opponents of competitive sourcing scored another win over OMB: The House passed an amendment by Rep. Chris Van Hollen, D-Md., to the fiscal 2004 Transportation-Treasury appropriations bill that would scuttle OMB's May revisions to A-76. Twenty-six Republicans broke ranks with the Bush administration to support the measure.

To counter these efforts, some observers believe OMB must improve its outreach to Congress. "I don't think the administration has done a good job in terms of educating and informing Congress as to what the true value of competitive sourcing might be," says a civilian agency official who deals with OMB. The budget office has promised to provide Congress with more information on ongoing job competitions.

Supporters of competitive sourcing have launched their own education campaign. In July, Sen. Craig Thomas, R-Wyo., held a hearing at which National Park Service Director Fran Mainella tried to dispel myths about competitive sourcing at her agency. Mainella emphasized that the Park Service had not tapped maintenance funds to pay for job competitions, as had been implied by agency documents obtained by the news media. "No maintenance backlog funds have been or will be used on competitive sourcing in any location," she said.

Even opponents of competitive sourcing concede that OMB can withstand hostile votes in Congress, because the White House has considerable leverage when bills go to House-Senate conference committees, as seen in the conference over the FAA reauthorization bill. So far, only minor curbs on competitive sourcing-such as one requiring the National Institute of Standards and Technology to report to Congress on how A-76 affects its scientists-have been signed into law.

But as the competitions continue, critics of OMB's effort are coming out of the woodwork. Carl Houtman and Richard Stevens are two Forest Service employees who have tracked how much time their offices have devoted to competitive sourcing. They believe the results show job competitions are much more expensive than OMB contends. Whether Congress listens to such grassroots critics is an open question. But if history is any guide, lawmakers will keep trying to leave their mark on A-76.


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