Speedy interagency contracts face possible new restrictions

Interagency contracts appeal to contracting officers who are understaffed and under pressure to meet their agencies’ acquisition requirements quickly. But those contracts may lose some of their appeal if Bush administration officials and lawmakers impose stricter rules governing their use, federal contracting officials say.

Deidre Lee, director of management and chief acquisition officer at the Federal Emergency Management Agency, and other acquisition experts discussed changes in interagency contracting at an Oct. 17 conference sponsored by the Government Electronics and Information Technology Association. An interagency contract is one that an agency awards and lets other agencies use. Lee offered five reasons for the appeal of interagency contracts: time, staffing, revenue, flexibility and protests.

  • Time. “We’re in a hurry all the time,” Lee said. That impulse to get things done quickly isn’t unique to the acquisition culture, she added.

  • Staffing. In the early 1990s, the federal government decided the acquisition workforce was too large and cut back, Lee said. During that period, departments awarded interagency contracts so they could avoid time-consuming competitions that required a well-staffed workforce.

  • Revenue. Agencies that award an interagency contract can add a service fee, which brings in additional revenue. Lee said procurement offices need the revenue to provide customer support.

  • Flexibility. Lee called the flexibility of interagency contracts “our deep little secret.” Departments can store their appropriations dollars in an interagency contract to use at a later time. That flexibility gives officials additional months to formulate their acquisition plans, but under certain circumstances, it is illegal.

  • Protests. Interagency contracts limit the number of contractors that can receive task and delivery orders, and those orders cannot be protested.

The Bush administration and Congress now want to impose tighter regulations on those contracts.

Robert Burton, deputy administrator at the Office of Federal Procurement Policy, said overseeing interagency contracts is among OFPP’s highest priorities.

OFPP wants to improve oversight so the Government Accountability Office will remove interagency contracts from its High Risk List, Burton said. OFPP might require agencies to get OFPP approval for new interagency contract awards, he said.

However, even if new regulations cause agencies to reconsider their use of those contracts, one factor in their appeal may not be entirely lost, and that’s the speed with which agencies can award an interagency contract task order, Lee said. “We can now buy the wrong thing pretty fast.”

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

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