FEDERAL

ADVERTISING

CONTRACTS

Agencies Have

Discretion in Setting

Work Scope and

Requirements

United States General Accounting Office

GAO Report to Congressional Requesters

September 2000

GAO/GGD-00-203

United States General Accounting Office General Government Division

Washington, D.C. 20548

Page 1 GAO/GGD-00-203 Federal Advertising Contracts Work Scope and Requirements

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September 8, 2000

The Honorable John D. Dingell

Ranking Minority Member

Committee on Commerce

House of Representatives

The Honorable Carolyn Cheeks Kilpatrick

House of Representatives

The Honorable Robert Menendez

House of Representatives

This report responds to your request for a review of federal advertising

contracts awarded to advertising firms. As we reported to you in April

2000, from fiscal year 1995 through fiscal year 1998, the share of federal

advertising prime contract obligations to small disadvantaged businesses,

which are generally minority–owned businesses, declined from $3 million,

or 3.1 percent of total advertising contract obligations, to $1.2 million, or

0.3 percent.1 This small percentage and the downward trend triggered your

concern that the ability of minority-owned advertising firms to respond to

requests for proposals (solicitations) for advertising contracts might be

restricted by the contractor requirements in the solicitations.2

In response

to your concern, we agreed to (1) describe the discretion that federal

agencies have in determining a contract’s scope of work and the

contractor requirements for awarding advertising contracts, (2) determine

whether contractor requirements in the solicitations for contracts were

consistent with the scope of work described in the solicitations for the

advertising contracts with first-time obligations in fiscal years 1998 and

1999 that were awarded to large advertising firms3

through full and open

1

Federal Advertising Contracts: Distribution to Small Disadvantaged Businesses (GAO/GGD-00-102R,

Apr. 17, 2000).

2

Contractor requirements as used in this report means all of the general and specific capabilities

required of a contractor to accomplish a specified scope of work as set forth by the procuring agency

in the request for proposals for a specific procurement.

3

The Federal Procurement Data System reporting manual requires that any business or concern, as

defined in the Federal Acquisition Regulation (FAR) 19.001, be classified as large if it does not meet the

definitions for a small business concern or individual. The annual sales threshold for small advertising

agencies is $5 million.
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competition,4and (3) determine whether there was required

documentation for the sole-source justification and approval for the

advertising contracts with first-time obligations in fiscal years 1998 and

1999 that were awarded through sole-source procedures.

While federal legislation and regulations prescribe various steps to be

taken and factors to be considered in establishing contract requirements

and selecting contractors, agencies have broad discretion in establishing

the scope of work and requirements for prospective contractors. This

discretion may affect which contractors realistically can bid on a contract

and win the award. For example, if an agency determines that an

advertising campaign must be conducted nationwide to effectively meet

the agency’s work needs or mission, then advertising firms without that

capability would effectively be eliminated from competition. Acquisition

reforms give contracting officers additional discretion in source selection.

For example, the Clinger-Cohen Act of 1996 (P.L. 104-106) gives

contracting officers the authority to eliminate offerors by narrowing the

range of offerors considered to be competitive if a contracting officer

deems that there are too many offerors to evaluate efficiently. In addition,

contracting officers can consider factors beyond price in determining

which offeror presents the best value. Legislation and regulations

encourage contracting officers to use this discretion in order to satisfy

agency requirements with regard to cost, quality, and timeliness of

delivered product or service while continuing to conduct business with

integrity, fairness, and openness.

The solicitations for the advertising contracts with first-time obligations in

fiscal years 1998 and 1999 that were awarded to large advertising firms

through full and open competition contained general evaluation criteria for

prospective contractors, such as consideration of past performance. In

addition, every solicitation had more specific contractor requirements.

These included such requirements as that the contractor be a full-service

advertising firm or have nationwide capability. These specific contractor

requirements seemed to be consistent with the scope of work

requirements outlined in the solicitations.

For the 12 sole-source contracts that received first-time obligations during

fiscal years 1998 or 1999, the justifications were prepared, as required, by

the procuring agencies. Also, all sole-source procurements had the

required approval at the appropriate level within the agencies.

4

Full and open competition is defined by FAR as competitions that permit all responsible sources to

compete.

Results In Brief
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The Office of Federal Procurement Policy at the Office of Management and

Budget, the General Services Administration (GSA), and contracting

officials at other agencies from whom we collected data generally agreed

with the information in this report.

Total obligations to federal advertising contracts increased from $139

million in fiscal year 1994 to $548 million in fiscal year 1999.5

In fiscal years

1998 and 1999, more than 90 percent of all advertising contract obligations

involved contracts with large advertising firms. These contracts generally

had been awarded to these large firms through full and open competition.6

Using the Federal Procurement Data System (FPDS) database,7we

determined that 24 advertising contracts received first-time obligations

during fiscal years 1998 or 1999, and received total obligations of about

$351 million during the 2-year period. Table 1 shows the type of solicitation

procedures agencies used to award these advertising contracts and the

total amounts obligated, by solicitation type, for fiscal years 1998 and 1999.

Category Number of contracts Percent

FYs 1998 and 1999

obligations ($000) Percent

Full and open competition-large

firms a

8 33.3% $204,724 58.3%

Full and open competitionsmall firms 1 4.2 2,537 0.7

8(a) set-asides 3 12.5 270 <0.1

Other than full and open

competitionb

12 50.0 143,661 40.9

Totalc 24 100% $351,192 100% a

Full and open competition is defined by FAR as competitions that permit all responsible sources to compete.

b

This is the category used for sole-source contracts. Sole-source acquisition as defined by FAR is a contract for the purchase of supplies or services that

is entered into by an agency after soliciting and negotiating with only one source.

c

There were an additional 56 contracts for advertising purposes awarded through either purchase orders or blanket purchase agreements. FPDS does not

provide any information on the nature of competition for these contracts. Obligations under these contracts totaled about $3.2 million over the 2 fiscal

years.

Source: GAO analysis of FPDS- and agency-provided data.

5

Federal Advertising Contracts: Distribution to Small Disadvantaged Businesses (GAO/GGD-00-102R,

Apr. 17, 2000) provides detailed trend information on obligations for fiscal years 1994-1998.

6

Information on the amount of advertising obligations going to large firms holding contracts awarded

through full and open competition was not readily available for periods prior to fiscal year 1998.

7

FPDS tracks federal contracting costs based on contract actions that affect obligations of funds for

contracts. The Federal Procurement Data Center manages FPDS. A center program analyst advised us

to use the year that contracts received obligations for the first time to determine when a contract

became active.

Background

Table 1: Solicitations for Advertising Contracts With First-Time Obligations in Fiscal Year 1998 or Fiscal Year 1999
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While federal legislation and regulations prescribe various steps that

agencies must take and factors that must be considered in complying with

the federal procurement process, legislation and regulations give the

agencies broad discretion in establishing the scope of work and

requirements for prospective contractors. This discretion is designed to

give agencies the flexibility to use their best business judgment in contract

development and award while continuing to conduct business with

integrity, fairness, and openness.

The agency first identifies a need to support its mission. Once the agency

determines, through market research, that contracting out is the best

alternative to provide for the need, it is to develop requirements to be

contained in the contract’s scope of work. Market research should be

conducted to help ensure that legitimate needs are identified and tradeoffs evaluated to acquire items to meet those needs. The contracting

officer is to select the type of contract that best meets the need of the

acquisition. Contracting officers are required to promote and provide for

full and open competition in soliciting offers and awarding government

contracts. However, FAR allows contracting officers to exclude some

sources in order to meet legal requirements, such as set-asides for small

businesses. In addition, the contracting officer can award sole-source

contracts under certain conditions, such as unusual and compelling

urgency.

For full and open competitions, the solicitations are to be publicized. The

solicitations are to contain the scope of work to be performed and the

evaluation criteria, or factors, for assessing bids and contractor

qualifications. The contracting officer is to establish an evaluation team to

evaluate offerors’ proposals responding to the solicitation and to rate the

proposals’ strengths, deficiencies, significant weaknesses, and risks

relative to factors specified in the solicitation.

Throughout the process, the agency and contracting officer have

discretion that may affect which offerors realistically can bid on a contract

and win the award. For example, scope of work requirements determined

from the start of the process establish how an advertising campaign is to

be run and the type of services that are required. This may have a great

deal of influence over the kind of advertising firm the agency decides is

required to conduct such a campaign. If the agency determines, for

instance, that an advertising campaign must be conducted nationwide to

meet the agency’s needs or mission, then advertising firms without that

capability may effectively be eliminated from competition. By the same

token, an advertising campaign that has a specific target location or

Agencies Have

Discretion in

Establishing Criteria
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requires a specific type of service may be best suited for firms that

specialize in that area or service.

Moreover, acquisition reforms have given contracting officers additional

discretion in source selection. For example, the Clinger-Cohen Act of 1996

gives contracting officers the authority to eliminate offerors from

consideration if the contracting officer determines that the number of

offerors that would otherwise be considered are too many to evaluate

efficiently. The contracting officer may limit the number of offerors

considered to be competitive to the greatest number that will permit an

efficient competition among the offerors rated most highly.

In addition, contracting officers can evaluate contractors by determining

best value, a concept which includes factors other than price. Legislation

and regulations encourage contracting officers to use this discretion in

order to satisfy the customer’s needs with regard to cost, quality, and

timeliness of delivered product or service while continuing to conduct

business with integrity, fairness, and openness.

When contractors believe that agencies have not conducted contract

solicitation or award appropriately, there are several forums to hear and

decide protests involving the interpretation and application of federal

laws, rules, and regulations that apply to contracts. We are one of these

forums in that we decide protests and may prepare recommendations for

consideration by the agency. These decisions on protests often function as

precedents for interpreting statutes and other legal requirements.

Our analysis of solicitations for advertising contracts with first-time

obligations in fiscal years 1998 and 1999 indicated that there were specific

contractor requirements that could limit the type of contractors to be

considered in the eight solicitations for contracts awarded to large

contractors through full and open competition. These requirements,

however, seemed consistent with the scope of work described in the

solicitations.

FPDS data showed that in fiscal years 1998 and 1999 first-time obligations

went to seven large firms that had been awarded eight advertising

contracts through full and open competition. During the 2-year period, a

total of about $205 million in obligations went to these seven firms. Table 2

provides details concerning these eight contracts.

Contractor

Requirements for

Advertising Contracts

Competitively

Awarded Seemed

Consistent With Scope

of Work Requirements
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Funds obligated ($000)

Agency

Advertising firm

contractors 1998 1999 Total

Health and Human Services1Ogilvy, Inc. $128,846 $128,846

Department of the Navy BBDO Worldwide, Inc. $19,273 40,416 59,689

Food and Drug Administration

Arnold Communications,

Inc. 10,494 10,494

Federal Bureau of Investigation

Miller Advertising Agency,

Inc. 2,000 2,000 4,000

Internal Revenue Service

Hodes, Bernard

Advertising, Inc. 775 775

Health Care Financing Administration

Transportation Display,

Inc. 446 446

Nuclear Regulatory Commission

Hodes, Bernard

Advertising, Inc. 300 46 346

Peace Corps Periscope, Inc. 122 6 128

Total $32,189 $172,535 $204,724

1

Health and Human Services awarded this contract on the behalf of the Office of National Drug Control Policy.

Source: GAO analysis of FPDS- and agency-provided data.

Generally, evaluation factors specified in the solicitations for these

contracts included factors relating to past performance, technical merit,

personnel capabilities, and price. However, each of the solicitations

contained more detailed specifications in the scope of work and

contractor requirement sections. The scopes of work laid out the types of

advertising campaigns envisioned by the agency. Scopes of work for these

eight contracts often described the use of multiple services, such as

marketing, consulting, and creative development, as well as the use of

nationwide campaigns. Consistent with these scopes of work, the most

frequent contractor requirements for these solicitations included the need

for (1) a full-service contractor, (2) a contractor with experienced

personnel and relevant work experiences, and (3) a contractor with

nationwide service delivery capability.

Table 3 shows our summarization of contract purpose and the detailed

contractor requirements we found in the solicitations for each of the eight

contracts.

Table 2: Contracts Awarded to Large Firms Through Full and Open Competition With First Time Obligations in Fiscal Years

1998 and 1999
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Agency Contract purpose

Fullservice

contractor

Contractor work

force capability

National capability for

target audiences Specific location

Health and Human

Services1

Youth Anti-Drug Media

Campaign • • •

Department of the

Navy Recruiting • • •

Food and Drug

Administration

Tobacco Retailer Compliance

Outreach Campaign •

Federal Bureau of

Investigation

Seized/Forfeiture Property

Program Campaign •

Internal Revenue

Service Recruiting • • •

Health Care Financing

Administration

Children’s Health Insurance

and Flu Programs Campaign •

Nuclear Regulatory

Commission Recruiting • • •

Peace Corps Recruiting • •

1

Health and Human Services awarded this contract on the behalf of the Office of National Drug Control Policy.

Source: GAO analysis of agency-provided data.

A requirement for a full service contractor that could perform multiple

services was part of five of the solicitations–the four recruiting

solicitations and the Youth Anti-Drug Media Campaign solicitation. While

the precise services for each contract varied, the detailed requirements

were clearly stated in each solicitation. For example, the Internal Revenue

Service solicitation for recruiting services specified that contract services

included, but were not limited to, (1) marketing, consulting, and strategic

development as necessary to develop, implement, and maintain an

effective recruitment plan; (2) creative development, including writing

copy, art work, graphics, and, other creative work; (3) placing advertising

in periodicals, newspapers, radio, television, or other advertising media;

and (4) ongoing project management. The requirement for full service

contractors in these five solicitations seemed to be consistent with their

scope of work requirements.

In addition, these same five solicitations had contractor requirements

aimed at the capability of the contractor or its personnel. These provisions

typically provided that prospective contractors should have experience

performing the type of work specified in the solicitations. Sometimes, the

contractor requirements were quite specific. For example, in the Navy

solicitation, the contractor requirement specified that in assessing whether

Table 3: Bidder Requirements Included in Solicitations
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the potential contractor had sufficient capability and experience to handle

an account of the size and complexity envisioned, the agency would

review the number of contracts a contractor had been awarded that were

over $1 million, $5 million, and $20 million. The potential contractors for

the Navy contract were also required to list gross billings, although there

were no required minimums. The Health and Human Services solicitation

provided that, in assessing corporate stability, the agency would review

the number of years in business and size of the contractors’ accounts, but

again there were no stated minimums.8

The same solicitation said that the

agency would evaluate past experience on two “relevant advertising

campaigns.” The Peace Corps solicitation required submission of

information about two advertising campaigns within the past 2 years

“within the $60,000 to $100,000 price range.” These requirements seemed

consistent with the scopes of work because they required that contractors

demonstrate that they had performed work similar to that required in the

contract.

Requirements concerning specific capabilities that key personnel must

have included the Health and Human Services solicitation that required

that the project manager must have demonstrated experience in managing

national, behavior-change-oriented, integrated communication contracts.

The solicitation provided detailed information on the various management

experiences that the project manager must possess. The Navy solicitation,

by contrast, required key personnel to have a relevant B.A. degree, 2 years

general work experience, and 2 years working on multifaceted advertising

campaigns. The Nuclear Regulatory Commission solicitation required that

the contractor personnel assigned to this contract have demonstrated

experience in recruitment advertising, with specialized experience in high

technology and nuclear-related fields. These requirements seemed

consistent with the contracts’ scopes of work because their object was to

have the contractors show that they had personnel who had the

experience or expertise to perform the specific requirements of the

contracts.

Five of the solicitations had scopes of work that outlined the use of

nationwide advertising campaigns. Consistent with that requirement, the

solicitations required that a contractor have the nationwide capability to

8

According to a Department of Army official, the Army required that advertising agencies must have

had $350 million in annual billings to compete for an advertising contract that was awarded in fiscal

year 2000. Firms below this threshold could partner with larger advertising firms to compete. The

contract was awarded to Leo Burnett Worldwide in Chicago and two minority-owned subcontractors.

We did not include this contract in our examination because it was outside the time period of our

review.
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reach defined target audiences. The Youth Anti-Drug Media Campaign

solicitation, for example, required a nationwide focus on youths, parents

and other primary caregivers, and other youth-influential adults. To ensure

effective communication with youths and adults, as well as with minority

racial and ethnic groups, the solicitation required that at least one minority

communication specialist be on staff to take into account the suitability of

different media for different audiences. In addition, the Navy solicitation

for recruiting required that a contractor have the nationwide capability to

conduct an advertising effort targeted to a diverse audience that included

minorities and women.

Two solicitations were scoped for target audiences in designated cities.

Specifically, the Internal Revenue Service solicitation was for advertising

of seasonal positions in the Atlanta, Cincinnati, and Memphis Service

Centers and their satellite offices. The Health Care Financing

Administration’s solicitation also required advertising services in several

specific cities. These solicitations required that contractors have the ability

to conduct advertising campaigns in those locations.

For the 12 sole-source contracts that received first time obligations during

fiscal years 1998 or 1999, the justifications were prepared, as required, by

the procuring agencies. Also, as required, all sole-source procurements had

been approved at the appropriate level within the agencies.

As shown in table 4, a total of about $144 million was obligated during

fiscal years 1998 and 1999 to 12 sole-source contracts that received firsttime obligations during those fiscal years.

Funds obligated ($000)

Agency Contractor Contract purpose 1998 1999 Total

Health and Human

Servicesa

Bates Advertising USA, Inc.bYouth Anti-Drug Media Campaign $119,848 $19,900 $139,748

Health and Human

Servicesa

The Advertising Council, Inc.c, d Youth Anti-Drug Media Campaign 1,398 1,398

Department of the Army The Advertising Council, Inc.bPromote Employer Support of Guard

and Reserve

818 818

Department of the Army The Advertising Council, Inc. bGet-Out-The-Vote Campaign 650 650

Education The Advertising Council, Inc. bNational Education Excellence

Partnership

168 150 318

State Department Japan Association of Travel

Agentse

Travel Trade Show 230 230

Sole-Source Contracts

Had Necessary

Documentation for

Justification and

Approvals

Table 4: Sole-Source Contracts With First-Time Obligations In Fiscal Year 1998 or Fiscal Year 1999
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Funds obligated ($000)

Agency Contractor Contract purpose 1998 1999 Total

Internal Revenue Service Cox Enterprise, Inc.bRecruiting 196 196

Housing and Urban

Development

Nashville Tennessean Banner b Sale of HUD-Acquired Properties 100 100

Veterans Affairs The Hearst Corporationb Recruiting 52 48 100

Smithsonian The Yellow Book bPhone Book Advertisement 26 26

Office of Personnel

Management

College Placement Council, Inc.fGovernment Employment

Awareness

44 44

Housing and Urban

Development

The Real Estate Couriereg Sale of HUD-Acquired Properties 35 35

Total $120,203 $23,460 $143,663

a

Health and Human Services awarded this contract on the behalf of the Office of National Drug Control Policy.

b

Large Business.

c

Other Nonprofit Organization.

d

The scope of work to be performed by The Advertising Council, Inc., required it to perform the public service announcement functions for the Youth AntiDrug Media Campaign. The scope of work for the Bates Advertising contract required it to perform the commercial advertising portion of the campaign.

e

Foreign Contractor.

f

Nonprofit Educational Organization.

g

Other Small Business.

Source: GAO analysis of FPDS and agency provided data.

Two different reasons were cited by the agencies as justifications for

awarding these 12 contracts as sole-source procurements. Eleven of the

contracts were justified on the basis that there was only one responsible

source.9 The remaining contract was awarded by Health and Human

Services and justified as needed because of what the agency considered an

unusual and compelling urgency.

FAR requires that contracting officers justify the use of sole-source

procurements in writing, certify the accuracy and completeness of the

justification, and obtain approval of the procurement from designated

agency officials.10 Depending on the award amount of the contract, solesource justifications must be approved by different officials within an

agency. Table 5 shows the different approval categories required by FAR.

9

Responsible source means a prospective contractor that meets the standards set forth for contractors

in subpart 9.104 of FAR. This includes such standards as whether the prospective contractor has the

financial resources to perform and has a satisfactory performance record.

10FAR subparts 6.303 and 6.304.
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Approving authority Award amount of contract

Senior procurement executive of agency Over $50,000,000

Head of the procuring activity Over $10,000,000 up to $50,000,000

Competition advocate for procuring activity Over $500,000 up to $10,000,000

Contracting officer, unless agency directs

otherwise $500,000 or less

Source: GAO analysis of FAR.

For sole-source contracts over $50 million, the senior procurement

executive of an agency is required to approve in writing the justification

for awarding a sole-source contract. The Health and Human Service’s

Youth Anti-Drug Media Campaign contract which totaled almost $140

million, was the only contract in this category. The sole-source contract

was awarded to Bates Advertising USA, Inc., as a follow-on contract to a

prior contract that Bates had been awarded through full and open

competition. The follow-on sole-source contract was awarded based on

what the agency concluded was an unusual and compelling urgency to

keep the anti-drug campaign active while the agency developed a

solicitation for a subsequent contract that would be awarded through full

and open competition. Also, the justification document noted that having

the sole-source contract in place would save $20 to $30 million through the

purchase of fall television time during the summer when costs were lower.

The sole-source contract justification was approved by the Health and

Human Services Assistant Secretary for Management and Budget as

required.

When a sole-source procurement is over $500,000 but does not exceed $10

million, the competition advocate for the procuring agency must approve

the justification for a sole-source contract in writing. Three of the 12 solesource contracts were in this cost range. They were all awarded to The

Advertising Council, Inc., based on the firm’s unique qualifications and

position in the advertisement sector. This firm is a not-for-profit

organization founded and supported by the American business, media, and

advertising sectors that conducts a variety of public service advertising

campaigns. The organization secures volunteer creative talent from a wide

range of advertising agencies and associations and facilitates the

furtherance of a number of timely national causes. For those federal

agencies it chooses to represent, The Advertising Council, Inc., offers free

advertising placement, among other free or low cost services. Because of

the firm’s ability to access high quality advertising services for free or at

low cost and its experience with public service campaigns, the agencies

Table 5: Sole-Source Contract

Justification Approval Categories
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considered the firm the only responsible source and noted that the firm is

in a “unique” position to satisfy the government’s requirements. In all three

cases, justification for sole-source procurement was approved as required.

Sole-source procurements of $500,000 or less are required to be justified

and approved by contracting officers unless agency procedures require

otherwise. Eight of the 12 sole-source contracts were within this cost

range. Four of these contracts were with large advertising firms, and the

other four were with foreign, non-profit, or other small firms. We obtained

and reviewed letters of justification and approval for seven of the eight

contracts that required such documentation. All seven justification and

approvals were authorized and signed by the contracting officer or a

higher approving official. The justification and approvals stated that the

sole-source contractor was the only responsible source available to

perform the statement of work.

No justification and approval documents were required for the eighth

contract. The Office of Personnel Management awarded this contract

under simplified acquisition procedures to a nonprofit educational

organization for a total of $44,300. In this case, the simplified acquisition

procedures permitted the contracting officer to award a sole-source

contract if the contracting officer determined that only one source was

reasonably available. In such cases, justification and approval

documentation is not required.

We provided a draft of this report to the Acting Deputy Administrator of

the Office of Federal Procurement Policy at the Office of Management and

Budget, and to the Administrator of GSA, for their review and comment.

On August 31, 2000, we received oral comments from the Associate

Administrator for Procurement, Law, Legislation, and Innovation, Office of

Federal Procurement Policy, and from the Chief, Customer Liaison

Branch, of GSA’s Federal Procurement Data Center. Both officials stated

that they generally concurred with the information included in the draft

report. We also obtained comments from agency contracting officials

regarding our reporting of the solicitation and contracting data that they

provided. Responding officials generally concurred with our presentation

of the information they had provided. Several officials provided clarifying

technical information that we have included as appropriate.

To describe the extent that federal agencies have discretion in determining

the scope of work and contractor requirements in their advertising

contract solicitations, we reviewed pertinent legislation and regulations.

Agency Comments

Scope and

Methodology
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To determine the consistency of contractor requirements with the scope of

work as defined by the federal agencies, we obtained and reviewed

solicitation packages for eight advertising contracts awarded to large firms

that received their first contract obligations during fiscal years 1998 and

1999 as recorded in the FPDS database. This review included comparisons

such as whether a requirement for a contractor with national capabilities

was consistent with the scope of work describing the geographical

locations where the contractor would be required to provide services

during the contract. In performing the comparison, three individuals

independently reviewed the scope of work and the specific contractor

requirements to determine if the requirements seemed consistent with the

scope of work.

To determine whether justifications and approvals of sole-source

advertising contracts were properly documented, we obtained and

reviewed justifications and approvals on file for all sole-source contracts

recorded in the FPDS database as receiving their first contract obligations

in fiscal year 1998 or fiscal year 1999. We compared the documented

justification and approval with requirements outlined in FAR regarding

when these were needed and who must approve them.

We did not validate the work needs included in the solicitations that we

examined, nor did we try to determine the impact of the work needs on

prospective contractors’ willingness to respond to the solicitations. Also,

we did not validate the sole-source justifications. Moreover, we did not

verify the FPDS data provided to us by officials at the Federal

Procurement Data Center. However, we did compare the FPDS data with

the specific type of solicitation indicated in agency documentation. When

we found errors in FPDS regarding the solicitation type used, we

reclassified the contracts accordingly.

We conducted our work from March 2000 to August 2000 in accordance

with generally accepted government auditing standards.

We are sending copies of this report to Representative Tom Bliley,

Chairman, House Committee on Commerce; Senator John McCain,

Chairman, and Senator Ernest Hollings, Ranking Minority Member, Senate

Committee on Commerce, Science and Transportation; Senator

Christopher Bond, Chairman, and Senator John Kerry, Ranking Minority

Member, Senate Committee on Small Business; and Representative Jim

Talent, Chairman, and Representative Nydia Velazquez, Ranking Minority

Member, House Committee on Small Business. We are also sending copies

of this report to the Honorable Adia Alvarez, Small Business
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Administration, and other interested parties. Copies will also be made

available to others on request.

If you have any questions regarding this report, please call me at (202) 512-

8387, or Hilary Sullivan at (214) 777-5600. Other contributors are

acknowledged in appendix I.

JayEtta Z. Hecker

Associate Director, Government

Business Operations Issues
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Contents

1 Letter

Appendix 18

GAO Contacts and

Staff

Acknowledgments

Table 1: Solicitations for Advertising Contracts With

First-Time Obligations in Fiscal Year 1998 or Fiscal

Year 1999

3

Table 2: Contracts Awarded to Large Firms Through Full

and Open Competition With First Time Obligations in

Fiscal Years 1998 and 1999

6

Table 3: Bidder Requirements Included in Solicitations 7

Table 4: Sole-Source Contracts With First-Time

Obligations In Fiscal Year 1998 or Fiscal Year 1999

9

Table 5: Sole-Source Contract Justification Approval

Categories

11

Tables

Abbreviations

FAR Federal Acquisition Regulation

FPDS Federal Procurement Data Service

GSA General Services Administration
Page 17 GAO/GGD-00-203 Federal Advertising Contracts Work Scope and Requirements
Appendix

GAO Contacts and Staff Acknowledgments

Page 18 GAO/GGD-00-203 Federal Advertising Contracts Work Scope and Requirements

JayEtta Z. Hecker (202) 512-8984

Hilary Sullivan (214) 777-5652

In addition to those named above, Thomas E. Baril, Jr.,William R. Chatlos,

Victor B. Goddard, Billy W. Scott, and William T. Woods made key

contributions to this report.

GAO Contacts

Acknowledgments
Page 19 GAO/GGD-00-203 Federal Advertising Contracts Work Scope and Requirements
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