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> **GSA Federal Supply Service**

IT Industry Government Council Meeting #5

Notes

November 30, 2004

Annapolis, MD

8:30 AM- 4:00 PM

**Welcome Darlena McKnew**

**GSA Update Darlena McKnew**

**Patricia Pierson**

**Roy Chisholm**

**Robin Bourne**

A.  Questions

    a.  Bruce Leinster: What is FCI?---FCI is IT Acquisition Center.

    b.  Robin Bourne- Sales for 1^st^ 90 days are flat, we will talk
        about that during the IT study.

    c.  Government Solutions Summit-similar to SBA matchmaking events

**Industry Update Ed Naro**

A.  Has a copy of the ITAA presentation \[which has since been emailed
    to Council members\], that has good information inside.

B.  New legislation

    a.  Push from GSA & Industry

    b.  Two parts of legislation

        i.  Pressure to fix problems

        ii. DoD IG & GSA IG must review all customer client service
            centers

        iii. FTS graded with one of three scores

             1.  Satisfactory

             2.  Better than used to be

             3.  Unsatisfactory

        iv. Allows some survivability of FTS

        v.  854 (blunted)

            1.  Disclosure of information when using non-DOD contracts

            2.  Whenever using outside vehicles in DoD

                a.  Collect data for use of vehicle or services

                    i.  What was bought

                    ii. What was bought in terms of services to acquire
                        the product

                b.  Disclose all fees

                c.  No limit set

                d.  Year end must report costs to Sec. of Defense

            3.  Piece missing

                a.  No requirement to capture use of DoD vehicles

                b.  No internal check means no value for comparison

    c.  Consequence of Bill

        i.  "Perfect Storm" of Acquisition

            1.  Collision of legislation

        ii. Industry Perspective

            1.  Receipt of 801 memo (checklist to use before going to
                non-DOD contract) has had a chilling effect with the use
                of schedules

            2.  From the last quarter GSA leadership felt comfortable
                because of last years' numbers

                a.  But now should see implications of 801

            3.  Glenn Baer -- Echoes feelings; come up with answers as
                what can be done

            4.  Oct. 29^th^ memo: hit parade of items; industry should
                take checklist and answer questions put forth in memo

                a.  DoD doesn't have a contracting body to handle its
                    load without GSA

                b.  Bruce Leinster: Memo from who? Controller, not Dee
                    Lee.

                c.  Writer of memo was approached: Are you sure you want
                    to shut down acquisition in DoD?

                d.  How many C4 contracts? 106 primes.

            5.  Creating a schedule type contract in the Navy -- under
                IDIQ have to solicit all on contract

                a.  Bruce Leinster: All contractors must bid on all
                    opportunities.

                b.  Ed Naro: CEOSS is BPA of Schedule contracts---person
                    signing didn't know that.

                    i.  Impact hasn't been seen by senior GSA personnel

                    ii. Regions have stepped back in FTS

                    iii. Losing DoD customers

            6.  Ultimately, the impact of the legislation isn't
                registering with GSA

            7.  Glenn Baer -- BPA at the Space/Missile Center TAS
                vehicle -- sent over acquisition plan -- sent question
                about what you are getting with the BPA-resistance out
                of space and missile command

    d.  Two issues brewing: Morphing/changes made to IT & General funds
        regulating administering and use

        i.  PSC luncheon\--What's going on & why was asked to Perry

            1.  Response -- We are trying to understand that times have
                changed and the distinctions don't exist. We will
                probably combine them sometime soon.

        ii. Asked to Perry -- Mechanism by which GSA will use to
            transition to one fund

            1.  Severability in contracts

                a.  Put money in fund?

                b.  Add money in years

            2.  How will that be done?

                a.  Consequence of taking \$700-800M is that it goes
                    back to treasury -- headache/concern then to use GSA

                b.  FTS has ability to protect funds

            3.  How will it be handled? Will it affect how budgets are
                awarded?

                a.  Take what agencies have put into fund, agencies will
                    be left in a bad place with possibly no funding for
                    their projects. Industry doesn't think GSA is
                    realizing all implications of transition.

                b.  Kitty- customers leave Schedules because of funds,
                    out of scope problems.

    e.  Federal Government Procurement of the Americas, meeting in
        Vancouver. -- "How we do it \[contracting/acquisition\]"

        i.  Other countries and offices presenting what they were doing.

            1.  GSA and non-GSA, Mexico

        ii. All countries wanted to see greater transparency in
            Acquisition, as opposed to more regulation

        iii. Becoming a more global issue

        iv. Meeting will be held in Atlanta next year

    f.  Small Business Matchmaking efforts

        i.  Industry perspective -- should be doing more

        ii. Small business is critical to the economy

            1.  Greatest payoff dollar for dollar in improving our
                economic state

        iii. Have had a few, but is in the industry's best interest to
             participate

             1.  Idea is not to involve GSA, just industry-small and
                 large

             2.  The more we embrace the small business concept, the
                 more we will reap benefit.

    g.  Time and Materials Contracts: gone to associations for review

        i.  Perhaps send out new legislation

            1.  GAO asking interesting questions

                a.  What's use in commercial basis? All of subcontract
                    work is on commercial basis.

                b.  When does it make/not make sense?

            2.  Language probably will be useful and good

        ii. Bruce -- a little nervous

            1.  PSC, ITAA have made comments

            2.  Should not apply to commercial services

            3.  Questions are troubling; want to know where they're
                coming from

            4.  Need to clarify issues of payment

                a.  Clause in the FAR leads you to believe
                    subcontracting is under section M, so cost is paid,
                    not rate.

                b.  We don't provide cost and pricing data

            5.  Need to watch closely

            6.  T & M have been done in Schedules

            7.  Comments were due on Nov. 19^th^

            8.  Statute has four conditions for use

                a.  Get three quotes

                b.  Has to be a Federal Procurement

                    i.  Reasons for sole source -- why restrict contact
                        vehicle in sole source environment?

                    ii. David Safavian is not a proponent of T & M
                        contracts.

**Office of Marketing Pam Mines**

**IT Study Update**

A.  NAICS code sales and trend analysis of schedule 70

    a.  Looking at as much data as we can to analyze market for
        FTS/FSS/GSA perspective

        i.  Depths of data

        ii. What to expect next

        iii. Will share issues not in presentation

        iv. From interviews- there is a perception about using GSA

            1.  We need to communicate to our customers the value of the
                Schedules on a senior level.

        v.  Ed Naro- Who can articulate the pricing methods used in the
            client service centers?

            1.  No one can answer how things are priced.

            2.  Single paper on GSA letterhead on structure used for
                pricing so everyone would be aware.

        vi. Kitty Klaus---Customers think FTS and FSS go hand in hand.

        vii. Ed Naro---Congress doesn't even know.

        viii. Kitty Klaus- Great strides in e-buy.

        ix. Ed Naro\-- FTS doesn't mention you can do it yourself---its
            not in their best interest.

        x.  Ron Segal---Some high levels say no to doing it yourself.
            Customers end up paying more through FTS to use the same
            vendor.

        xi. Ed Naro---FTS could still prove worthy and have a stake in
            something.

        xii. GWACs are to be online in the future.

             1.  Issues---hard to find advantages of each GWAC

             2.  Consistent rise in market share

             3.  Federal IT budget

    b.  NAICS codes to show market share

        i.  What is GSA's strong suit?

        ii. Looking for what has a high percentage of commercial
            sales---50% or greater

            1.  High dollar

            2.  Mostly hardware

        iii. Best potential, high % of sales, not much market share

        iv. FTS- shift in market share for regions

***Committee Reports***

**Cooperative Purchasing Peter Schwartz**

A.  90% of NIGP members are municipalities

    a.  Nick Economou has agreed to work with the committee

B.  Bill Bowser (Deputy Chief of Procurement, Department of Management
    and Budget, Annapolis, MD).

    a.  We have a tough time

    b.  Cooperative purchasing regulation are already in place but it
        has to be more than \$250,000

        i.  Purchases less than that are 80% of spending

    c.  \$250,000 floor lifted on October 1, 2004.

    d.  Other than buildings and grounds, DMB does all buying for IT.

    e.  When using the schedules, they must use the exact terms and
        conditions of the Federal contract and they may add t's and c's
        if necessary. The ones added by the state are generally
        socio-economically related.

    f.  We can go to contractor directly

    g.  Politics are around

    h.  How do we decide who to buy from under Schedules?

        i.  We don't use federal vehicles because we don't want to
            disadvantage small companies in MD.

    i.  8 principles to compete

    j.  We don't want to discriminate against folks who want to do
        business with the state.

    k.  Not all contractors have a GSA contract.

    l.  DMB is the primary procurement unit.

        i.  Companies go to other agencies and then run risk of not
            getting paid.

    m.  Concern is too many local companies don't have GSA contracts.

    n.  Can't award to some county firms specifically.

    o.  Questions/Issues

        i.  Robin Bourne: Do you go out competitively? Can you limit
            competition?

            1.  Bill Bowser: We don't limit. Our political agenda is to
                allow minority businesses get money. Unbundle
                requirements.

            2.  Glenn Baer: There are unique SDB requirements for MD.

            3.  Bill Bowser: We don't know which Schedule contracts are
                Maryland SDB certified. We are recompeting all
                contracts. \$350 million in contracting

        ii. Glenn Baer: You have used coop purch agreements, can you
            discuss?

            1.  Bill Bowser: MILK- women and children's program---4 or 5
                five states got together

            2.  Glenn Baer: Have you used other multistate programs?

            3.  Bill Bowser: No, not much.

        iii. Ed Naro: Do you add t's and c's?

             1.  Bill Bowser: We can. All contracts over \$200K go
                 through the board of public works.

                 a.  Every other Wednesday---a public forum---get there
                     early at 10AM.

                 b.  They have their own agenda.

                 c.  I will back you up if we have a good rationale.

                 d.  We have our own master IT contract and we still
                     award to large businesses a lot.

        iv. Bruce Leinster: You could say in the RFP that the prime must
            sub out 50% of work to nonscheduled holders---small
            businesses.

        v.  Ed Naro: You are allowing local businesses to work with
            nonlocal businesses to give them new opportunities, gives
            incentives to companies to get possible federal business.

        vi. Paul Woolverton: We had an issue where the local business
            couldn't work with a federal agency so we subbed to them.
            They didn't have a Schedule and it worked for them.

        vii. Robin Bourne: Do you know --out of 30 state
             contractors---how many have Schedule contracts?

             1.  Bill Bowser: I know 1.

        viii. Bruce Leinster: How many proposals do you receive?

              1.  Bill Bowser: 168.

        ix. Do you have enough people to evaluate them?

            1.  Yes, we usually receive 5-10 proposals.

        x.  Why should we use GSA and exclude competition at the state
            and local level?

        xi. Why use GSA competitive requirements versus MD competitive
            requirements?

        xii. GSA contract is considered a "discriminating factor." Who
             are we discriminating against and why?

        xiii. Small business size classifications are different in MD
              than standard NAIC code discriminators

    p.  GSA is #3 in the preferred range

C.  Cathy Muse \[as reported by Peter Schwartz\]

    a.  Very excited about the Cooperative Purchasing Program

        i.  Has used the IT Schedule and the savings were
            remarkable---equal to one FTE.

    b.  Budget = \$½B

    c.  Views tool as a negotiated contract versus competed, can be
        problematic at times

    d.  Concerned about small business who don't have a schedule

    e.  Has used twice

        i.  \$25K consulting contract

        ii. \$75K consulting contract

    f.  Wanted to juggle being good to small businesses vs. efficiency

    g.  May look to GSA based procurement in the future

    h.  As mandatory uses expire, they will start to incorporate
        Schedules.

    i.  Will share template that has been used to incorporate
        cooperative purchasing.

        i.  Will push to NIGP and maybe to Steps.

    j.  Large outsourcing companies approaching locals now

    k.  Willing to work with committee

    l.  Tom Davis hasn't been as visible at this level.

D.  Ron Segal: Had chat with Tom Davis

    a.  His interest is in national level politics, not in VA

    b.  His wife is interested in state

    c.  He's not abandoning idea

E.  Carol

    a.  Has used Schedule 70

    b.  Willing to use if can't find it anywhere else

    c.  Takes just as long as under Schedules as fair and open
        competition

    d.  Doesn't want to ever disadavantage anybody in local

    e.  Have leveraged GSA and good relationships to move forward.

    f.  \$5M budget

    g.  Would be useful in new product/services

    h.  Tom DeWitt -- value tied to money; cost savings show in large
        buys, target high budget areas---Fairfax has \$500 mil. Budget.

F.  Peter Schwartz: Messaging needs to be crisp and defined for each
    target

    a.  One message for:

        i.  State

        ii. County

        iii. "What's in it for me?"

        iv. Municipalities

G.  Sheryl McCurnin

    a.  Marketing to states who can't use Schedules

        i.  She doesn't have mechanism to turn off for state -- not
            enough customer codes

        ii. Gets grief from states for marketing because they think its
            not legal for them to use schedules

        iii. Hears more negative than positive

H.  Robin Bourne: Bill, must counties use you?

    a.  Bill Bowser: No, just state, although they can use us.

**e-Tools Matthew Chelap**

A.  Looking for a new chair

B.  Please contact David Orcutt if interested

C.  E-buy suggestions

    a.  Kitty Klaus\--Under the "no quote" options there needs to be an
        "out of scope" button.

    b.  Bulletin board of RFQs should be available to ALL schedule
        holders? Especially with performance based contracts that can
        have technical or "soft" solutions. Makes procurements more
        *transparent*

D.  Ed Naro

    a.  Integrated Acquisition Environment, if all gets connected in
        system correctly we will be able to model the Federal
        Acquisition System. We can them simulate in advance of changes
        in rules and regulations. Promises a better acquisition
        environment than before.

E.  Robin

    a.  Chuck's briefing was at the beginning

        i.  Emod and eoffer have been opened up to the Services
            Acquisition Center and an issue is making eoffer the only
            avenue to come in---would like industry's perspective on
            that.

        ii. Ed Naro: Integrated Acquisition Environment will have
            contracts online---put all GSA contracts on web.

        iii. Robin Bourne: Committee should interact with GSA offices

        iv. Deborah Lague: Not everyone's contract online---proprietary
            information

            1.  If you take exceptions, you won't be online.

            2.  1^st^ phase\-- contract---section C of
                solicitation---t's and c's

            3.  2^nd^ phase---pricelist

            4.  Tricia Pierson: Everything is in draft still.

        v.  Ed Naro: We are in transition w/PBSA, some say e-buy should
            be available to all Schedule holders, not just under the
            SINs posted. Associations are looking into this.

**Teaming Committee Kitty Klaus**

A.  Ed Naro: disclosure is better than nondisclosure

B.  Robin Bourne: Did Jeff say he would train his IOAs?

C.  Kitty Klaus: I don't know.

    a.  T & M clause- committee response pending GSA response.

    b.  Ron Segal: Not sure what people prefer-do we have an obligation
        as a team member to disagree? Is there a way GSA can be silent
        on privity?

    c.  Kitty Klaus---Some companies are not educated.

    d.  Sherry Stauffer---Teaming proposals should spell it out.

    e.  Bruce Leinster: Hopefully language will be clear. Scope of team
        members should be clear.

**Training Committee Ed Naro**

A.  Industry folks didn't know about "STEPS"---not good distribution

B.  Talking about different parts of GSA is critical.

C.  DoD is the biggest customer and has some of the largest problems

    a.  Stems from DoD not knowing enough about GSA and different parts
        of GSA

    b.  Therefore, 6-7 questions must be answered every time they are
        dealt with

**EPA Committee Sheryl McCurnin**

A.  Ron Segal: Prices go up and down for sound business
    reason---contracts should model this.

B.  Sherry Stauffer: Some resellers get increases, some don't, we end up
    pulling products.

C.  Ron Segal: If there is a new reseller, they can benefit because they
    can price higher at the onset.

D.  Ed Naro: The IT community is different; it shouldn't mirror the
    competition of furniture.

E.  Paul Woolverton: What happens if you have a "do not exceed" and the
    commodity price doubles? You've frozen the possibility of memory
    being sold.

F.  Robin Bourne: Vendors buy in large amounts.

G.  Paul Woolverton: The market has gone towards the Dell model of
    just-in-time inventory. Pricing is out of our control. IT has a lot
    more components than other products.

H.  Ed Naro: Committee's outputs will be crafted into white papers.

**Open Session**

A.  Kitty Klaus---Contractor's Report Card

    a.  Share with customers?

        i.  Serious Question: Who gets to see it?

        ii. Are things on card necessary for customers to know?

        iii. Look on your report card-contractors.

             1.  Sheryl McCurnin: need password to access it online

             2.  Email Deborah Lague, she has a POC who can get your
                 password. Deborah.Lague@gsa.gov

        iv. Could it be shown to competitors?

        v.  Meeting with FX---posting report cards online

    b.  3 new items checked

        i.  TAA Compliance

        ii. Scope Compliance

        iii. Sub-contracting plan Compliance

    c.  Graded on aspects not a part of your contract

    d.  Can go out and look at report card from ACO

        i.  Better to check periodically

B.  Next meeting is in February

C.  Council membership

    a.  Think of a mechanism for rotation/replacement for IGC

    b.  Need customer members-recommend customers

        i.  Marketips article to recruit

    c.  Possible FTS member

        i.  Tim McCurty

        ii. Daryl Nottingham

    d.  Goal: At the end of next year have an attrition plan in place

    e.  Try to get customers who aren't educated by Schedules to teach
        them.

D.  Ed Naro: G + A on ODCs- people have had different guidelines.

    a.  It has been assumed that rates are fully loaded unless
        mentioned.

    b.  Emile Monette---policy is coming soon.

    c.  Ron Segal---example for travel on G + A

    d.  Emile Monette---people have commented on ODCs policy. I don't
        know who has been approached.

    e.  Sheryl McCurnin\_-you will recover your G + A somehow.

E.  Ed Naro: Committee chairs: Condense powerpoint presentations to 2
    sentences and submit to Ed for Steps article.

    a.  Add council members to Steps distribution list.

F.  Next agenda

    a.  Topical discussion: Julie Wise

    b.  Roger Waldron

G.  Attendance

    a.  Bill Bowser

    b.  Glenn Baer

    c.  Tricia Pierson

    d.  Peter Schwartz

    e.  Kitty Klaus

    f.  Sherry Stauffer

    g.  Bruce Leinster

    h.  Ron Brooks-IBM

    i.  David Orcutt

    j.  Tricia Reed

    k.  Shannon Wheeler

    l.  Lindsay Levine

    m.  Pam Mines

    n.  Mollie Ifshin

    o.  Tom DeWitt

    p.  Grace Dittmar

    q.  Sheryl McCurnin

    r.  Mike Pingrey

    s.  Emile Monette

    t.  Ron Segal

    u.  Robin Bourne

    v.  Darlena McKnew

    w.  Roy Chisholm

    x.  Paul Woolverton

    y.  Mike Tock-Aspen Systems

    z.  Ed Naro

    a.  Patrick Flynn