Six weeks ago, federal unions celebrated congressional passage of long-sought provisions that would dramtically alter the Bush administration's competitive sourcing agenda. On Monday, President Bush proposed to repeal those legislative changes.
Buried deep in the appendix of the administration's 2,200-page fiscal 2009 budget is a one-sentence proposal to rescind a pair of competitive sourcing provisions -- passed by Congress in late December and signed into law by President Bush -- in the fiscal 2008 Omnibus Appropriations Act.
The president's budget calls for the repeal of Section 739, which would exclude health care and retirement costs from the public-private cost comparison process for all non-Defense agencies. Labor groups contend that private sector teams gain an unfair advantage by contributing less to their employees' benefits than that required of federal agencies.
The omnibus language also gives federal employees the right to appeal the results of the competitions to the Government Accountability Office and explicitly prohibits the use of quotas that require agencies to compete a pre-determined number of federal jobs. The Office of Management and Budget said it abandoned the use of quotas in 2003.
The budget did not call for the repeal of other competitive sourcing provisions in the omnibus and the 2008 Defense Authorization Act that prohibit A-76 competitions at a number of federal agencies, including the Labor Department, the Bureau of Prisons and the Army Corps of Engineers. Nevertheless, labor groups and lawmakers who championed the at-risk competitive sourcing provisions came out swinging against the administration's proposal.
"Congress got it right when it enacted much needed and key improvements in federal contracting rules," said Colleen Kelley, president of the National Treasury Employees Union. "Despite the desire of the White House to turn over as much federal work as it can to the private sector, we are not going to let them run from this important commitment to fairness and to the fundamental need to spend federal dollars in ways most advantageous to the taxpayers."
The proposed repeal of the A-76 provisions could be dismissed by Congress in short order. In a statement to Government Executive, José Serrano, D-N.Y., chairman of the House Appropriations Financial Services and General Government Subcommittee, which helped write the competitive sourcing restrictions, said he found the administration's actions "deeply objectionable." "Not only will I not entertain the thought of repealing it but, indeed, I will be watching closely to ensure that OMB follows the letter of the law with regard to the A-76 process," Serrano said.
In recent years, both Republicans and Democrats have backed legislation to limit the number of private sector competitions and alter how competing proposals are graded. With Democrats in the majority, the unions likely will have a receptive voice on Capitol Hill in favor of continuing the A-76 restrictions-and possibly even expand them. The American Federation of Government Employees "believes that it has compelling arguments for perfecting, expanding and enforcing those provisions in the next bill," said John Threlkeld, the labor group's legislative director.
Bush's budget did not provide an explanation for the suggested repeal of Section 739, but Paul Denett, administrator for the Office of Federal Procurement Policy, told Government Executive that such an approach would reverse "burdensome and ineffective requirements to the competitive sourcing process which would force agencies to choose providers based just on lowest cost rather than best overall value." GAO frequently upholds "best value" selections, Denett added.
At a media briefing last week, Denett gave no hint that the Bush administration would seek to repeal the omnibus legislation. He said then that he was disappointed with the legislative fixes but maintained that Congress "did not kill" the competitive sourcing program. He said the administration would continue pressing agencies to conduct new competitions and even suggested that OMB would release guidance later this month instructing officials on how best to handle the health care and retirement benefits provision.
The proposed repeal is the latest attempt by the administration to circumvent recently enacted congressional legislation dealing with federal contractors. Last week, shortly after signing the 2008 National Defense Authorization Act, Bush issued a signing statement claiming that he did not have to abide by four provisions in the bill, including one that created a bipartisan Commission on Wartime Contracting in Iraq and Afghanistan. The panel, modeled after the World War II Truman Committee, is designed to root out waste and fraud in military contracts. Sen. Jim Webb, D-Va., a co-sponsor of the commission, said the Bush statement was an "impingement on the rights" of Congress, and that the Senate was "marching forward" with the panel.
The other three provisions prohibited the use of federal funds to establish permanent U.S. military bases in Iraq; strengthen whistleblower protections for employees of contractors; and require intelligence agencies to turn over additional documents to Congress.
Bush said the provisions could inhibit his "ability to carry out his constitutional obligations to take care that the laws be faithfully executed, to protect national security, to supervise the executive branch and to execute his authority as commander-in-chief."