Industry surrenders to rewrite of Part 15

Despite some lingering doubts from small businesses that they could be put at a competitive disadvantage for future federal information technology contracts the IT industry has capitulated and accepted the proposed rewrite of Part 15 of the Federal Acquisition Regulation.

The rewrite of Part 15 - which governs major IT acquisitions - has been a top procurement policy goal of the Clinton administration. The revision is intended to eliminate inefficient contracting practices and improve the exchange of information between agencies and vendors. But industry concerns over details particularly those projected to negatively impact small businesses have threatened to derail the rewrite.

But the final rule may be released next month about the time the Office of Federal Procurement Policy bids farewell to administrator Steven Kelman. "The comment period is now closed " said Kelman who instigated the rewrite during his tenure at OFPP. "A team is now very aggressively looking at all of the public comments and reacting to them. The FAR Council has already had one meeting and is now preparing to take some policy positions."

Kelman said there would be some "further substantive changes based on written comments " but the IT industry seems to be expecting no surprises when the final rule is issued.

A notable exception to this sense of industry resignation was outcry from small-business advocates still angry over competitive-range provisions.

At issue is a provision in the rewrite that allows contracting officers to limit the number of proposals in the competitive range. Many vendors particularly small businesses have complained that the rule will lead contracting officers to exclude unfamiliar bidders most notably small businesses.

The U.S. Chamber of Commerce argues that the rule gives contracting officers too much latitude to narrow the range. "The contracting officer can always limit the competitive range to as few as two proposals because the top two proposals would have the greatest likelihood of award " the chamber wrote in comments submitted to OFPP.

"There is still a lot of work to be done in some very important areas where changes must be made to the proposed rule or [else] it will result in harm to small businesses' ability to compete and win government contracts and will change the basic tenets of procurement policy " said Jody Olmer director of domestic policy for the chamber. "We gave OFPP specific recommendations that are very critical. They are the support beams of the procurement process."

But NASA officials who began last October to urge contracting officers to use smaller competitive ranges reported to OFPP that the number of awards going to small businesses has not declined.

The agency reported that before and after the policy change small businesses won about 38 percent of the awards worth more than $100 000.

Olmer said the chamber—in its letter signed by the American Small Businesses Association and the American Subcontractors Association—has gotten no assurance from OFPP that differences over competitive-range language will be addressed in this final round of regulation writing. "We haven't gotten any such indication from OFPP " Olmer said. "The sense we get from OFPP is that they intended this to be the last draft and that they appreciate changes we proposed " but "no thanks" to any further discussion she said.

Other industry representatives agreed that OFPP is nearing the end of its tolerance for changes. "We did do a very brief letter on FAR Part 15 for this round of written comments " said Olga Grkavac senior vice president of the Systems Integration Division of the Information Technology Association of America. "But we really felt that most of our concerns had either been addressed in the rewrite or were not about to be addressed because the FAR Council had gone as far as they would go."

Kelman's exodus was largely the reason the IT industry stopped its push for bigger changes. "After September some momentum will die down " said Ella Schiralli director of marketing and government relations for the Electronic Industries Association. "The other point is what do you hope to achieve" at this stage of the process?

Olmer however objected to the notion that industry should suffer the greater good just for a revision that meets Kelman's professional time frame. "I don't know what the rush is in getting it done while Steve Kelman is there " she said. "I don't think we should ever hurry if it is going to mean that we end up with something so wrong."

-- Jones is a free-lance writer based in Falls Church Va.

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