Panel seeks input from GSA's customers

Career officials from several agencies could receive invitations to speak to a panel that's reviewing the General Services Administration’s multiple-award schedule program.

At a meeting June 17, the Multiple Award Schedule Advisory Panel said it will request input from auditors, inspectors general, officials at large and small agencies, and congressional staff members so the members can get a better sense of what’s happening with the $36 billion buying program run by GSA. The panel’s next meeting is July 21, but it has not set a date for sending the invitations.

Panel members said they were disappointed by how few customers have spoken with them, having heard from only the Justice Department. Therefore, they suggested that GSA invite representatives from the Veterans Affairs Department, GSA, the Army Materiel Command, the Defense Department’s Enterprise Software Initiative, the Education Department, the Small Business Administration and others.

The panel wants to know how and why customers use the program and what they consider best value. Questions for the prospective speakers span numerous topics, but the core issue is price.

Meanwhile, two panelists from major customer agencies have challenged the program’s pricing structure.

Tom Sharpe Jr., senior procurement executive at the Treasury Department, said he has no confidence that the schedule contract prices are the lowest or that the negotiated price for a product or service matches a contractor’s most-favored customer price.

The program requires contractors to give the government the same price they give their best, or most favored, customers. Sharpe said GSA has not proven to him that it’s actually getting that price, and as a major customer, he’s concerned that he might not be getting a good deal by using the schedules.

“Big sales at a bad price are a big problem,” Sharpe said.

Elliott Branch, chairman of the panel and executive director for contracts at the Naval Sea Systems Command, said the definitive question is whether contract prices are justified. If customers have no confidence, the next step is stripping the price-reduction clause from schedules contracts and radically changing the program. With confidence in the price, then the recommendations might be less dramatic, he added.

The panel has asked GSA to submit data related to various aspects of the schedule program. Panelists said they will use the input from speakers and the data from GSA to shape the future of the program.

The program had more than $36 billion in sales in fiscal 2007, GSA said, and officials expect an increase in sales volume this year. It is one of GSA’s most important contract vehicles.

In an effort to update the program, former GSA Administrator Lurita Doan commissioned the advisory panel in March to give independent advice and recommendations to the agency related to pricing. Therefore, the panel is reviewing the most-favored customer provisions, price-reduction policies and provisions, and current commercial pricing practices.

By the end of the six-hour meeting June 17, the panel had narrowed its attention to five areas: pricing, stakeholders’ views of the program, their expectations, the program’s business model and whether contractors are offering agencies the same price its most-favored customers receive.

The invitations will either ask the speakers to address a list of questions related to those topics or let the speakers know the panel is interested in those issues.

About the Author

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

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