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Telework Isn’t the Only Thing PTO Needs to Do a Better Job of Monitoring

IG faults patent office for lax supervision of risky contracts.

The Patent and Trademark Office, recently under fire for weak supervision of telecommuting examiners, has insufficiently monitored its time-and-materials contracts to information technology service providers, a watchdog found.

Contracts that present a higher risk of cost overruns were managed by employees “who did not follow best practices” and failed to properly document invoices totaling $24 million, the Commerce Department inspector general concluded in a report dated Dec. 3.

Though the Patent Office by presidential order enjoys some freedom from compliance with parts of the Federal Acquisition Regulation, it is still required to follow Office of Federal Procurement Policy guidelines as well as the Commerce Department’s acquisition manual in managing time-and-materials and labor-hour contracts. The agency did not, however, provide the required written justification for time-and-materials contracts.

Auditors, after examining 28 contracts, found that first, “contract and task order awards lacked justifications and established ceiling prices, (2) contractor monitoring and oversight was inadequate, and (3) contract files lack key documentation.”

Contracting officers and program officials “often did not prepare or did not provide surveillance plans” or service level agreements, the report said, and the managers “did not consistently document acceptance of deliverables or maintain surveillance documentation of contractor performance.”

In a review of 103 invoices worth $35.4 million, auditors found that invoices totaling $24.6 million “lacked adequate support to determine whether payments made to the contractors were warranted.”

Finally, the IG found, Patent Office contracting officials “did not ensure that surveillance personnel were trained, certified and appointed prior to providing contract technical oversight for contracts.”

On one task order for facilitating and creating documentation for the contractor’s information systems activities that cost the government $4.5 million, USPTO was billed and paid approximately $72,500 for a total of 501.5 labor hours. “The contractor did not submit any supporting documentation other than a monthly summary report on the invoice that identified the labor category, labor rate, total hours billed, and total costs billed for each labor category,” the watchdog found.

In the report addressed to Deputy Commerce Undersecretary for Intellectual Property Michelle K. Lee, auditors asked for an action plan on improved training and monitoring within 60 days.

USPTO, after requesting some technical changes involving the definition of improper payments in a draft of the report, concurred with the recommendations.

(Image via  / Shutterstock.com)

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