Audit finds FTS deficiencies

IG's "Alert Report"

The National Capital Region of the Federal Technology Service failed to follow good contracting procedure in most of the contracts and task orders examined in a recent independent audit.

Acquisition Solutions Inc. officials studied about 260 contract files, looking at processes and procedures used from the pre-solicitation stage all the way through the end of the contract and asking questions about each stage. The consulting firm rated 84 percent of the items studied as either inadequate or seriously inadequate, according to the report.

FTS is an arm of the General Services Administration. GSA officials got the report last month and released it April 15.

The sample included task orders against several multiple-award contracts, as well as open-market procurements and other contract vehicles. The National Capital Region covers Washington, D.C.; Montgomery and Prince George's counties in Maryland; and Arlington, Fairfax and Loudoun counties and the city of Alexandria in Virginia.

GSA's Office of the Inspector General is conducting its own review of the region's office, along with other offices nationwide, but Capital Region leaders wanted information sooner and hired Acquisition Solutions to perform it own examination, said Mary Alice Johnson, FTS spokeswoman.

The scrutiny comes after abuses were uncovered last year at three FTS regional offices. They involved misuse of the Information Technology Fund, misuse of sole-source contracting authority and other failures.

Johnson said that Donald Williams, administrator for the Capital Region, wanted Acquisition Solutions to go over the office's practices in minute detail. "We initiated this study to identify any contracting irregularities that might exist so that if they did exist, we could correct them as soon as possible," she said.

"That's why you see a lot of smaller problems, but they're significant," Johnson said. "Things that will fix the problems have been underway for some months."

Among the findings:

Pre-solicitation: FTS officials did not conduct market research 83 percent of the time, and contracting officers did not help agencies develop their requirements in 78 percent of the contract actions. The office did keep the scope of work clear and ensure that it was not overly broad in 86 percent of the cases.

Solicitation/contract review: The solicitation was developed through a team effort only 5 percent of the time In 17 percent of cases, the question about teams was not applicable.. Solicitations were released electronically 95 percent of the time.

Receipt and evaluation of bids: Capital Region officials documented price negotiations incompletely 57 percent of the time, according to the audit report. They failed to complete past performance evaluations in 47 percent of the examined actions.

Contract administration: Officials failed to track the amount spent to ensure that a ceiling was not exceeded in 72 percent of the contract actions. They failed to hold a post-award orientation conference 71 percent of time, and did not handle changes in the scope of the contract appropriately in 19 percent of the actions.

Contract closeout: Officials failed to prepare an evaluation to document companies' performance, as a means of updating their past performance record, 34 percent of the time. They failed to return excess funds to customers 26 percent of the time.

The consulting firm questioned the regional office's use of the IT fund in only about 15 percent of the contract actions examined. The IT fund is a revolving account that FTS uses to procure IT products and services for customers, which the customers then repay. Other regions, notably Region 10 in the Pacific Northwest, have been criticized for using the IT fund to pay for non-IT projects, including building construction.


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