Group offers option to A-76 competition

An industry group last week unveiled a new model for public/private competitions that would replace unpopular outsourcing guidelines laid out by the Office of Management and Budget.

Under the proposal, developed by the Professional Services Council, an independent manager would oversee agency contracts in which the government bids against private companies for federal work.

PSC aims to revamp the process government undertakes when it considers outsourcing tasks that government workers perform, including tasks ranging from systems administration to data processing to digital map creation.

The process is laid out by OMB Circular A-76, which sets forth rules for the government to follow when allowing private companies to compete and bid against agencies to provide services.

PSC officials, who plan to present the proposal to Capitol Hill when Congress returns from its recess next month, said they ultimately want to have all "inherently nongovernmental" functions outsourced to the private sector. Meanwhile, they want to make existing procedures more equitable, said Bert Concklin, president of PSC.

"A-76 - in the most broad, fundamental sense - is a mortally flawed system for conducting public/private competition," Concklin said.

For one thing, the federal employees involved in the awarding of contracts tend to favor other government agencies who bid on a project because they involve government employees, he said. This gives government a competitive edge, according to Concklin.

PSC's model also would establish best-value procedures that would replace A-76's lowest-cost guidelines for conducting competitions. It also would set up an independent advisory committee of public and private experts to oversee the public/private competition process, and competitions would be overseen by an independent contract manager supported by government workers.

OMB did not return phone calls requesting comment.

Federal Sources Inc., McLean, Va., recently released a study on A-76 and found, among other things, that private industry beats the Defense Department 60 percent of the time when competing for DOD work (see Stats, Page 64).

Beth McElroy, the principal consultant behind the report, said it is difficult to cull information about A-76 contracts from agencies. She said that outsourcing increasingly is becoming a "key growth area" and that competitive outsourcing under A-76 is part of that trend, particularly in DOD.

The Army, she said, spends more than any other agency on outsourcing, while the Navy offers more individual contracts than any other agency.

Wiley Pearson, a defense policy analyst at the American Federation of Government Employees, said the union is concerned about how difficult it is to collect information about A-76 from agencies, which makes accountability and oversight troublesome.

Pearson said the A-76 process does put "stress and pressure" on government agencies, which may take a year or more to put together an A-76 project. But Pearson said A-76 offers some promise and called it "one tool of many to get better government or greater efficiency."

OMB, as required by the Federal Activities Inventory Reform Act, is expected to release a list of activities and federal jobs that are not inherently governmental and, therefore, could be outsourced to private companies. Agencies submitted their lists to OMB in June.

-- Doug Brown contributed to this article.