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Focus of new acquisition panel debated

A soon-to-be-named panel of acquisition experts has the chance to fix serious shortcomings in the federal procurement system, observers say, but some fear the panel will pursue the agenda of federal contractors and a powerful Republican congressman.

The acquisition panel is the creation of Rep. Tom Davis, R-Va., who added language establishing it to the fiscal 2004 Defense Authorization act. The panel will have a year to survey performance-based contracting, governmentwide contracts and the use of commercial acquisition practices, according to its authorizing language. The federal procurement administrator must pick at least nine experts to serve on the panel by the end of February.

Because of its association with Davis, most observers expect that the panel will take up his procurement priorities. Likely to be on the agenda: share-in-savings contracting, where agencies share profits generated by projects with contractors, and expanding commercial acquisition practices, which require less stringent oversight, according to Steven Kelman, a Harvard professor and former federal procurement administrator.

Critics expect the panel to rubber-stamp Davis' proposals. "I suppose he hasn't been as successful as he'd like to be in getting Congress to agree with a lot of his reforms, and maybe he feels this will help him justify his legislative priorities by saying this handpicked panel of my friends agrees with me," said Danielle Brian, executive director of the Project on Government Oversight (POGO), a watchdog group.

David Marin, a spokesman for Davis, questioned those charges. "More hot air from POGO. Did Ms. Brian miss the news that the vast bulk of Davis' Services Acquisition Reform Act is now law?"

Kelman said the panel should expand on the acquisition reform laws of the 1990s, and encourage agency acquisition officials to try innovative buying techniques such as share-in-savings contracting. He criticized Bush administration officials, including former federal procurement administrator Angela Styles, for sending "discouraging signals to people about innovation," in recent comments to the media.

"If I was an SES career person and I saw those comments…I'd ask myself, am I going to try performance-based contracting? Am I going to try share-in-savings? I don't think so," said Kelman.

Styles, a skeptic of the share-in-savings method, defended her views. "Thank goodness the agencies aren't putting taxpayer dollars at risk with share-in-savings contracts," she said. "Has a single agency that tried share-in-savings contracting had savings?"

Some experts urged the panel to examine how the acquisition reforms of the 1990s affected transparency and competition within the procurement system. Christopher Yukins, a professor at The George Washington University Law School, said the panel should explore ways to bring transparency to task orders made through indefinite delivery and indefinite quantity contracts, which currently are not visible to the public.

"At the task-order level our system lacks fundamental competition and transparency, and as a result there are collateral attacks on its integrity," said Yukins. "There is no reason why task orders over $25,000 couldn't be on FedBizOpps."

Marshall Doke, a partner at the law firm Gardere Wynne Sewell, said the panel should take an across-the-board look at the federal acquisition system, which has been changed in a piecemeal fashion for several years. "Every year there's a whole new set of requirements put on these government acquisition professionals, who are underpaid and undertrained," he said.

Others said the panel should focus on fine-tuning reforms from the 1990s. Larry Allen, executive director of the Coalition for Government Procurement, said the Veterans Affairs Department is flouting the spirit of the 1994 Federal Acquisition Streamlining Act by including audit clauses in contracts for commercial items. Such pacts should be exempt from post-award cost audits by procurement officials, according to Allen.

"At the [VA], it's become an opportunity to tie industry to a whipping post and lash away," he said.

Kelman advised the panel to survey companies that refuse to do business with the government to determine what barriers are keeping them out of the federal marketplace. Some contractors have long alleged that certain companies avoid the federal market because of government-specific auditing requirements.

But the panel may be hard pressed to do much independent research, according to Styles. "It has no money and no staff," she said. Styles said the panel should include officials whose business experience goes beyond selling to the government.

"If the panel wants to take an objective look at commercial services, commercial item issues, and Mr. Davis' issues, then some people with real private sector experience, that are not government contractors, need to be appointed to the panel," she said.

When asked about Davis' priorities for the panel, Marin referred to the statute that authorizes it, Section 1423 of the Defense law. He did not respond to a question asking whether reform of the task order process is a priority for Davis.

Once the panel is named, it will have a year to study acquisition issues before reporting to Congress. Under the law, all members will be chosen by the federal procurement administrator, a post which is currently vacant. Some observers think Davis will have input into the selection. "Tom Davis is choosing the members, so he will likely dictate the results," said Styles.

Experts said executive branch officials must take up the panel's findings if it is to have a lasting impact. In the early 1990s, Clinton administration officials seized on the report of a high-level group known as the Section 800 panel, paving the way for acquisition reform, according to Kelman. "What allowed it to become actionable was the Clinton administration's reinventing government agenda," he said.

POGO's Brian said the Section 800 panel is a poor precedent for this new panel. "Section 800 became an organized voice for industry to promote its agenda, so what worries me is that it's going to happen again," she said.