Defense and State brace for surge in Afghanistan contracting

Lawmakers on Thursday expressed concern about the Defense and State departments' ability to handle an influx of contractors in Afghanistan, but agency officials said they have taken steps to strengthen oversight.

During a Senate Homeland Security and Governmental Affairs Subcommittee on Contracting Oversight hearing, Sen. Claire McCaskill, D-Mo., said the degree of waste and fraud seen under contracts performed in Iraq does not bode well for efficiency in Afghanistan, particularly as the number of contractors in the region balloons to support the surge in troops.

According to the Congressional Research Service, if the ratio of contractors to U.S. military personnel remains roughly the same, the deployment of 30,000 more troops to Afghanistan would require 26,000 to 56,000 additional contractors. The number of contractors in Afghanistan already is growing; from June to September, there was a 40 percent increase in Defense contractors alone.

Auditors found "much of [the] waste [in Iraq] stemmed from inadequate contracting management, including contractors overseeing contractors, poor coordination of interagency efforts, continual personnel turnover and the challenges of contracting in a war zone," McCaskill said.

To avoid similar issues in Afghanistan, the U.S. Agency for International Development has hired more contracting officer technical representatives and regional inspectors general, improved COTR training for quality-control and assurance, and boosted the number and quality of site visits, said Charles North, senior deputy director of the USAID Afghanistan-Pakistan Task Force. The agency also is modifying contracts to include more stringent reporting measures and providing additional guidance for COTRs in ensuring compliance.

"In planning, managing and overseeing assistance in Afghanistan, a high-risk environment in which corruption and extortion pose significant risks, it would be impossible for USAID to guarantee that wrongdoing will never occur," North said. "However, we have put in place well designed systems and practices to minimize opportunities for misconduct."

Daniel Feldman, deputy special representative for Afghanistan and Pakistan at the State Department, said the focus is shifting away from large U.S.-based reconstruction contracts to smaller, more flexible contracts with fewer subcontracts and grants.

"The premise behind this flexibility is simple -- in a dynamic conflict environment like Afghanistan, we need to be able to adapt our programs as conditions change on the ground," Feldman said. "These smaller contracts and grants will be managed by U.S. officials in the field, closer to the actual activity implementation, making it easier for those same officials to direct, monitor and oversee projects to ensure the proper use of taxpayers' funds."

In most cases, the smaller contracts will be implemented by Afghans, but if the programs are not producing the desired results, State officials have more authority to direct corrective actions, Feldman said.

Army officials also testified to a renewed effort to control overseas contracts, noting they are concentrating on growing the service's acquisition workforce. But Edward Harrington, deputy assistant secretary of the Army for procurement, and Jeffrey Parsons, executive director of the Army Contracting Command, cautioned the expansion won't happen overnight.

"The time it takes to grow capable contracting professionals is measured in years, not months," Harrington said. "The level of experience required to be able to adequately perform the complex contracting functions we demand of our contracting professionals generally is attained after about six to eight years of school training combined with hands-on, work experience."

Harrington and Parsons said the Joint Contracting Command for Iraq/Afghanistan is "updating mission analysis" and assessing current resources to determine how best to support the additional 30,000 troops headed to Afghanistan.

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