Federal agencies create common rating scale for vendors

Federal agencies have agreed on a set of criteria and a common scale for rating vendor performance that contracting officers will rely on to make awards.

The criteria will be published by the Office of Management and Budget within the next two months in a new best-practices guide said David Muzio deputy associate administrator for procurement of innovation with OMB's Office of Federal Procurement Policy.

Muzio said the guide would lay out how agencies should collect and use data on how well vendors have performed on federal contracts.

In the three years since agencies began gathering past-performance data from potential suppliers vendors have clamored for more consistency in how contracting officers obtain and apply these references while OFPP has searched for ways to combat "grade inflation" by customers.

The OMB guide will describe five categories by which information technology vendors should be evaluated: timeliness cost control business relations and management personnel and subcontracts. Contractors will be rated on a six-point scale from zero (for vendors that fail to fulfill their contracts) to five (for vendors whose work exceeds agency requirements).

The Defense Department plans to use a different rating scale for some non-IT contracts.

OMB wants regular performance evaluations to become part of contract administration so the government can build a database of references Muzio said at a meeting last week sponsored by Federal Sources Inc. McLean Va. The guide will encourage agencies to put this information online either on a password-protected World Wide Web site or in a computer database that source-selection officials can tap.

"This is the key to making the entire system work " Muzio said because contracting officers have balked at having to provide repeated references for the same supplier. "If we get all this together we may not even have to ask contractors for a list [of references]."

Three agencies - the National Institutes of Health the Energy Department and the Defense Information Systems Agency - are building such computer systems. The Environmental Protection Agency plans to put its information on the NIH system Muzio said while DOD is looking into a system for linking its different contracting offices' systems.

Muzio said that since OFPP launched the past-performance program in 1994 officials have learned that agencies also need more help deciding how many references to examine. In many cases contracting officers asked for too many report cards covering numerous contracts he said and the new guide will advise them to choose only five or 10 recent contracts similar to the one they are awarding.

Meanwhile beginning in January agencies will have to begin collecting performance evaluations for contracts for less than $1 million although they will not have to use this data until 1999. Last December OFPP suspended this requirement which is part of the Federal Acquisition Regulation after agencies challenged the policy. The rule will not apply however to contracts for less than $100 000.

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