Spending bill inaction delays decision on job competition appeals

The General Accounting Office will likely wait until lawmakers have finalized fiscal 2004 spending legislation before deciding whether to hear appeals from federal employee teams losing work to contractors, an agency official said Tuesday.

By waiting to issue a decision, the watchdog agency is preserving a status quo that grants contractors an unfair advantage in public-private job competitions, a federal employee union official charged. Though the Senate has not approved the 2004 omnibus spending package, debate over competitive sourcing provisions in the legislation is done, the official said.

In June 2003, GAO solicited public input on how, or if, revisions to the Office of Management and Budget's rules on public-private job competitions should change federal employees' legal standing at GAO's bid protest office. The solicitation drew a number of responses from government officials and others, but GAO has held off on a decision because the agency was "waiting to see what Congress is going to do," said Daniel Gordon, GAO's associate general counsel.

Lawmakers attached provisions granting in-house teams legal standing to appeal job competition decisions to several versions of 2004 budget bills. One draft of the Transportation-Treasury appropriations bill would have allowed federal employees and their union representatives to protest competitive sourcing decisions at GAO. But the White House convinced congressional negotiators to eliminate that provision when wrapping the Transportation-Treasury legislation into an omnibus spending package.

Even though the House has approved the omnibus bill, GAO cannot be sure that the appeals rights language will not surface again before the Senate signs off on the legislation, Gordon said. The Senate will consider the spending package on Jan. 20 at the earliest.

If the appeals rights provisions are somehow reintroduced into the final omnibus budget bill, GAO would follow Congress' orders, Gordon said. If the legislation remains untouched, the watchdog agency would have a much tougher decision.

But GAO could be forced to speak its mind before the omnibus becomes law, if an in-house team or union attempts to file an appeal under the revised Circular A-76, Gordon noted. The 1984 Competition in Contracting Act gives GAO's bid protest office 100 calendar days to decide cases. No in-house teams or union representatives have tried to file appeals since OMB issued its revised circular, he said.

Only contractors losing job competitions could appeal to GAO under the old A-76 rules. GAO has long held that the Competition in Contracting Act does not give federal employee teams the legal standing to file appeals.

But OMB's May 2003 revisions to Circular A-76 give in-house teams, called "most efficient organizations," some new rights. For example, the new guidelines designate two key officials as "directly interested parties" for appealing A-76 decisions within an agency: the formal representative of in-house employees, known as the "agency tender official," and an official elected by a majority of employees on an in-house team.

The revised circular is silent on the issue of whether in-house team representatives should be viewed as interested parties for appeals to GAO, Gordon said. In addition, the changed circular leaves open the question of whether unions could represent teams of federal employees at GAO, should the bid protest office decide to hear in-house team appeals.

In response to its June solicitation for comments, GAO received substantial input from a variety of agency officials, Gordon said. Agency lawyers tended to argue that despite the A-76 revisions, federal employee teams lack standing to appeal competitive sourcing cases at GAO unless Congress amends the Competition in Contracting Act. Federal employees without a legal background generally favored granting in-house team appeals standing regardless of whether lawmakers amend the law.

As expected, federal employee unions stood in support of appeals rights. OMB intended the new circular to level the playing field for employee teams competing against contractors, said Martin Cohen, a lawyer at the an American Federation of Government Employees. The field will remain uneven until GAO extends appeal rights to in-house teams and union representatives, he argued.

Contractor associations and trade unions generally opposed extending GAO appeals rights--at least to unions.

Stan Soloway, president of the Professional Services Council, an Arlington, Va.-based contractors association, on Tuesday reiterated the view that agency tender officials, but not unions, should have the right to protest A-76 decisions to GAO on behalf of federal employees.

But AFGE President John Gage said agency tender officials are typically senior managers "charged with carrying out the Bush administration's extremist, pro-privatization agenda, and consequently cannot possibly be expected to adequately represent the interests of federal employees affected by privatization."

Soloway has said that a broader policy granting unions as well as agency tender officials standing before GAO could be the "death knell" of the competitive sourcing initiative. A broader policy would be inequitable and would also present practical problems, he said Tuesday. Unions could protest every stage of a job competition if granted standing, he said.

But Gordon said he is not too worried about the practical implications if in-house teams and unions receive appeal rights at GAO. The bid protest office receives a relatively small volume of A-76-related cases currently, and the number would probably not increase significantly even if unions gained standing, he said. Should the volume of appeals rise drastically, GAO would request a higher budget and more staff members to handle the increase, he added.

GAO is also able to dispose of frivolous cases fairly quickly, Gordon said. The watchdog agency finishes roughly a third of all bid protests, including non-A-76 protests, within 30 days, he said. But Soloway said that even a 30-day delay could impede progress on a job competition.

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