Varnado: GSA must prove its contracts' value

Tyree Varnado, acting commissioner of the Federal Acquisition Service, said today the General Services Administration hopes to show value to its customers to lead them away from using in-house contracts.

Agencywide and agency-specific contracts have seen modest growth over the last several years, he said, but GSA needs to prove to its customers that the Multiple Award Schedules contracts and the agency's  several governmentwide information technology contracts are worth the associated fees.

“We’re making sure there’s a high level of integrity and accountability in every thing that we do,” he said in a speech at Input’s FedFocus 2009. To achieve that, Varnado wants to overlay the clear principles of finance and accounting into how FAS handles its contracts. “We want to make sure that same black-and-white world transcends into the acquisition arena” he said.

As FAS tries to entice customers back to using its contracts, Varnado said GSA’s fee for using the schedules is appropriate. The agency charges its customers 0.75 percent for using its contracts. The fee, known as the Industrial Funding Fee, covers costs to run the MAS program. In 2004, GSA decreased the fee from 1 percent because of stronger sales, the agency GSA has said.

“We think that the fee is at the right level,” Varnado said. “What we think we need to do a better job of is educating our customers on the value of what you get for that fee.”

Varnado said his focus is on customer service, which echoes the priorities of other GSA officials, including GSA Acting Administrator Jim Williams. Varnado said he’s interested in the Multiple Award Schedule Advisory Panel’s recommendations on ways GSA may make its $35 billion schedules program easier for customers to use. The panel includes officials from several customer agencies, and it may formally release its recommendations before year’s end.

About the Author

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

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