Federal acquisition councils anticipate mandate to increase transparency

By Robert Brodsky

May 13, 2010

The Obama administration could be inching closer to requiring federal agencies to post online copies of their contract documents.

On Thursday, the civilian and defense acquisition councils, which craft changes to the Federal Acquisition Regulation, published an advance notice of proposed rule-making that could set the stage for arguably the most ambitious effort to date in procurement transparency.

The councils are seeking public comment on how best to amend the FAR "to enable public posting of contract actions, should such posting become a requirement in the future, without compromising contractors' proprietary and confidential commercial or financial information."

While the administration has not called yet on agencies to post copies of their approximately 30 million contractual actions, the notice could signal an upcoming major policy change. Neither the Office of Management and Budget or the General Services Administration responded to requests for comment about the proposed rule, or any pending regulatory changes.

"The councils anticipate that, in the future, a requirement to post online the text of contracts and task and delivery orders will be instituted," the proposed rule stated.

The notice referenced seven administration memos and directives issued during the past 18 months calling for increased transparency from federal agencies as the basis for drafting a proposed rule. But none of those documents mandate -- or even suggest -- the posting of government contracts online.

The public can acquire copies of individual agency contracts through Freedom of Information Act requests. And USASpending.gov, a database of federal contracts and grants, has made available since December 2007 information about government awards.

But any push to post all contract documents on a public website will face certain resistance from private industry, which previously has expressed concern that proprietary information would be available for the public -- and their competitors -- to scrutinize.

"The councils are looking into methods for identifying the types of information that should not be posted or released to the public, as well as means for electronic processing and posting, and development of provision or clause requirements for successful offerors to provide a redacted copy of the contract," the notice said. "The councils are also requesting suggestions for how best to protect the types of information through redacting, locating all such information in a standard place in the contract, or other possible methods to be considered."

While on the presidential campaign trail in 2008, then-Sen. Barack Obama unsuccessfully proposed a bill that would have required agencies to post all contract documents online.

The Obama administration has experimented with posting copies of contracts online, albeit in limited and high-profile circumstances.

In January 2009, the Treasury Department began posting copies of hundreds of contracts to companies receiving assistance through the Troubled Assets Relief Program, as well as awards to financial institutions the government hired to assist with the program. Later that year, under pressure from public watchdog groups, GSA released a heavily redacted copy of its contract for the redesign of Recovery.gov.

Now, some good government groups are calling for the administration to make the practice permanent.

"The administration's proposal is a refreshing shift after so many years of watching billions of dollars fly out the door and only coded summary data to justify that spending," said Scott Amey, general counsel for the Project on Government Oversight. "I'm encouraged that technology will allow the government to create an electronic contracting system that will reduce paper shuffling and finally allow the public to see details about goods and services the government buys each year."

One industry official said he expects the administration to make a serious effort to enact the policy change. "It plays right into the administration's transparency message and is consistent with discussions had elsewhere," said Larry Allen, president of the Coalition for Government Procurement.

Comments on the advance notice are due by July 12.

By Robert Brodsky

May 13, 2010