DEFENSE 

CONTRACTING

Early Attention in the 

Acquisition Process 

Needed to Enhance 

Competition

Report to Congressional Committees

May 2014

GAO-14-395

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-14-395, a report to 

congressional committees

May 2014

DEFENSE CONTRACTING

Early Attention in the Acquisition Process Needed to 

Enhance Competition

Why GAO Did This Study

Competition is the cornerstone of a 

sound acquisition process. In fiscal 

year 2013, DOD obligated over $300 

billion through contracts and orders, of 

which 57 percent was competed. DOD 

also obligates billions of dollars 

annually on contracts that are awarded 

using competitive procedures, but for 

which the government received only 

one offer. DOD implemented the Better 

Buying Power initiative in 2010, in part 

to increase competition. The 

conference report accompanying the 

National Defense Authorization Act for 

Fiscal Year 2012 mandated GAO to 

report on DOD’s noncompetitive and 

one-offer awards. 

GAO examined (1) the trends in DOD’s 

use of competitive awards, (2) the 

extent to which justifications for 

exceptions to competitive procedures 

were adequate and reasons for 

exceptions, (3) how DOD’s strategies 

aimed at promoting long-term 

competition are changing behavior, 

and (4) whether DOD’s requirements 

address reasons only one offer was 

received for competitive solicitations. 

GAO analyzed federal procurement 

data for fiscal years 2009 through 

2013; reviewed DOD policy and 

competition reports; examined two 

nongeneralizable samples of 14 and 

15 awards, in part, based on dollar 

value; and interviewed DOD officials. 

What GAO Recommends

DOD should ensure that existing 

acquisition planning guidance 

promotes early vendor engagement, 

and establish guidance for when 

contracting officers should assess the 

reasons only one offer was received on 

competitive awards. DOD concurred 

with these recommendations.

What GAO Found

The Department of Defense’s (DOD) competition rate for all contract obligations 

declined over the past 5 fiscal years from 62 percent in fiscal year 2009 to 57 

percent in fiscal year 2013, but remained flat for the past 2 years. In fiscal year 

2013, the Army had the highest competition rate, 66 percent, while the Missile 

Defense Agency had the lowest competition rate, 29 percent. The 14 

justifications for noncompetitive awards that GAO reviewed generally included 

the elements required by the Federal Acquisition Regulation such as the 

authority permitting other than full and open competition. The majority of DOD’s 

noncompetitive contracts and task orders (including all in GAO’s sample) were 

coded under the “only one responsible source” exception to competition 

requirements. Seven of the 14 justifications explained that the awards could not 

be competed due to a lack of technical data. In these cases, DOD did not 

purchase the necessary data rights with the initial award. In some cases the 

justifications provided insight into how a lack of data rights resulted in reliance on 

a single vendor over time. 

DOD’s focus on using open systems architecture and acquiring sufficient data 

rights—which DOD’s Better Buying Power memo encourages—is influencing the 

way DOD acquires goods and services. Programs are trying to move away from 

dependency upon single suppliers for parts, maintenance or upgrades and are 

moving toward open systems architecture, which allows components to be 

modified, replaced or maintained by multiple suppliers. Some DOD programs 

have shown that using open systems architecture and obtaining data rights 

involves early consideration and extensive analysis of how each system can best 

use these approaches to maintain a competitive environment throughout a 

program’s lifecycle. For example, an emphasis on open systems architecture and 

effective management of data rights resulted in increased competition for the Air 

Force’s user equipment for the Global Positioning System and KC-46 Tanker 

Modernization programs. 

In 2010, DOD introduced requirements for competitive solicitations that result in 

only one offer; however, these rules are focused late in the acquisition process 

and DOD has limited insight into the reasons only one offer is received. The 15 

one-offer awards GAO reviewed generally satisfied DOD’s rules, which require 

contracting officers to ensure adequate solicitation periods and conduct cost or 

price analysis. These rules were intended to help ensure more effective 

competition but may apply too late in the acquisition process. DOD contracting 

officials and vendors told GAO that engagement with vendors well before the 30 

day solicitation period is key to ensuring vendors have adequate time to review 

draft requests for proposals, plan resources, provide feedback on potentially 

restrictive requirements, and determine whether to prepare proposals. Moreover, 

contracting officers for the contracts GAO reviewed seldom collected information 

about reasons only one offer was received, which could limit their ability to revise 

acquisition strategies appropriately or plan for future competitive acquisitions. 

DOD’s one-offer rules do not require contracting officials to engage with the 

vendor community to learn why vendors chose not to submit offers. However, 

contracting officials chose to do so in two sample cases, and in one case, based 

on this information, changed the acquisition strategy to allow for recompetition 

sooner than planned.

View GAO-14-395. For more information, 

contact William T. Woods at (202) 512-4841 or 

woodsw@gao.gov.
Page i GAO-14-395 Defense Contracting

Letter 1 

Background 5

DOD’s Competition Rate Remained the Same for 2 Years 10

Justifications Generally Were Adequate and Many Cited a Lack of 

Appropriate Technical Data Rights as a Barrier to Competition 18

Focus on the Use of Open Systems Architectures and Emphasis 

on Data Rights Help to Guide Program Behavior 21

DOD’s One-Offer Requirements Are Focused Late in the 

Acquisition Process 27

Conclusions 34

Recommendations for Executive Action 35

Agency Comments and Our Evaluation 35

Appendix I Objectives, Scope, and Methodology 37

Appendix II Selection of Noncompetitive Justification and Approval Documents 42

Appendix III Selected One-Offer Awards 44

Appendix IV Comments from the Department of Defense 45

Appendix V GAO Contact and Staff Acknowledgments 47

Tables

Table 1: Ten Product and Service Categories Driving 

Noncompetitive Obligations for Fiscal Year 2013 (Dollars 

in Billions) 15

Table 2: Competition Exceptions for New Fiscal Year 2009 to 

2013 DOD Noncompetitive Contracts and Task Orders on 

Single Award Contracts 17

Table 3: Responses of 31 Weapon System Programs Regarding 

Use of Open System Architecture and Acquisition of 

Technical Data Rights 22

Contents
Page ii GAO-14-395 Defense Contracting

Figures

Figure 1: Notional Life Cycle Costs of Typical DOD Acquisition 

Program 7

Figure 2: DOD’s One-Offer Requirements Include Three Rules 9

Figure 3: Fiscal Years 2009-2013 Competition Trend 11

Figure 4: Competition Rates by DOD Component for Fiscal Years 

2009 through 2013 12

Figure 5: DOD’s Competition Rate and Competitive Obligations for 

Products, Non-R&D Services and R&D Services 14

Abbreviations

BBP Better Buying Power

DFARS Defense Federal Acquisition Regulation Supplement

DOD Department of Defense

FAR Federal Acquisition Regulation

FPDS-NG Federal Procurement Data System – Next Generation

IDIQ indefinite delivery/indefinite quantity

MDA Missile Defense Agency

OFPP Office of Federal Procurement Policy

R&D research and development

This is a work of the U.S. government and is not subject to copyright protection in the 

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Page 1 GAO-14-395 Defense Contracting

441 G St. N.W.

Washington, DC 20548

May 5, 2014

The Honorable Carl Levin

Chairman

The Honorable James M. Inhofe

Ranking Member

Committee on Armed Services

United States Senate

The Honorable Howard P. “Buck” McKeon

Chairman

The Honorable Adam Smith

Ranking Member

Committee on Armed Services 

House of Representatives

As the Department of Defense (DOD) and others have recognized, 

competition is the cornerstone of a sound acquisition process and a 

critical tool for achieving the best return on investment for taxpayers. The 

benefits of competition in acquiring goods and services from the private 

sector are well established. Competitive contracts can help save money, 

improve contractor performance, curb fraud, and promote accountability 

for results. In fiscal year 2013, DOD obligated $307.5 billion through 

contracts and task orders, of which 57 percent was competed. 

Acknowledging the need to make more efficient use of resources, DOD’s 

2010 “Better Buying Power” (BBP) initiative placed an emphasis on 

maximizing opportunities for competition in the acquisition of products 

and services.1

While federal statutes and acquisition regulations generally require that 

contracts be awarded on the basis of full and open competition, they also 

permit federal agencies to award noncompetitive contracts in certain 

circumstances, for example, when only one vendor can supply the 

requirement or when a sole-source award is made under specified small 

 

1

BBP is an initiative to strengthen DOD’s purchasing practices, improve industry 

productivity, and provide an affordable military capability to the warfighter. According to 

DOD, it encompasses a set of fundamental acquisition principles to achieve greater 

efficiencies through affordability, cost control, elimination of unproductive processes and 

bureaucracy, and promotion of competition.
 

Page 2 GAO-14-395 Defense Contracting

business programs. Generally, noncompetitive contracts must be 

supported by written justifications that address the specific exception to 

full and open competition that applies to the procurement. Also, the 

government obligates billions of dollars annually under contracts and task 

and delivery orders that are awarded using competitive procedures but for 

which the government receives only one offer—situations the Office of 

Management and Budget has cited as high risk.2 DOD has termed this 

“ineffective competition” and has implemented regulations requiring that 

additional steps be taken before a contract may be awarded when only 

one offer is received.

Since 2009, the Office of Management and Budget and DOD have 

implemented initiatives to increase competition. The conference report 

accompanying the National Defense Authorization Act for Fiscal Year 

2012 mandated us to report annually for 3 years on DOD’s 

noncompetitive and one-offer awards.3 For this report, we examined (1) 

the trends in DOD’s use of competitive awards, (2) the extent to which 

justifications for exceptions to competitive procedures were adequate and 

the reasons for the exceptions, (3) how DOD’s strategies aimed at 

promoting long-term competition are changing behavior, and (4) the 

extent to which DOD’s recent requirements address the reasons why only 

one offer was received for competitive solicitations.4

To identify trends in DOD’s use of competitive awards, we used the 

Federal Procurement Data System-Next Generation (FPDS-NG) to 

identify DOD obligations under competitive and noncompetitive contracts 

in fiscal years 2009 through 2013, the five most recent years for which 

complete data were available.5 For the purposes of this report, we defined 

 

2

For the purposes of this report, we refer to contracts and orders awarded using 

competitive procedures but for which only one offer was received as “one-offer awards.” 

3

H.R. Rep. No. 112-329, at 676 (2011)(Conf. Rep.). In March 2013, we issued our first 

annual report. GAO, Defense Contracting: Actions Needed to Increase Competition,

GAO-13-325 (Washington, D.C.: Mar. 28, 2013).

4

For the purposes of this report, we defined adequate justifications as those containing the 

required elements in accordance with Federal Acquisition Regulation.

5

FPDS-NG is the government’s procurement database. We assessed the reliability of 

FPDS-NG data by (1) performing electronic testing of required data elements, 

(2) reviewing existing information about the data and the system that produced them, and 

(3) comparing reported data from FPDS-NG to information from contract files in our 

review. We determined that the data were sufficiently reliable for the purposes of this 

report. For additional information, see appendix I.
 

Page 3 GAO-14-395 Defense Contracting

noncompetitive obligations to include obligations through contracts that 

were awarded using the exceptions to full and open competition listed in 

Federal Acquisition Regulation (FAR) Subpart 6.3. We also included 

noncompetitive orders issued under multiple award indefinite delivery / 

indefinite quantity (IDIQ) contracts or under the General Service 

Administration’s schedules program.6 We calculated the competition rate 

as the dollars obligated annually on competitive contracts and orders as a 

percentage of dollars obligated on all contracts and orders. For the 

purposes of this report, we focused on four DOD components: Air Force, 

Army, Missile Defense Agency (MDA), and Navy.

To assess the extent to which justifications for exceptions to competitive 

procedures were adequate and the reasons for the exceptions, we 

randomly selected a nongeneralizable sample of 14 contracts and orders 

coded as noncompetitive in FPDS-NG. Our sample included 

noncompetitive contracts and task orders from the largest product or 

service categories, measured by obligations, where the base and options 

values exceeded $650,000 for awards made from April 1, 2012, through 

March 31, 2013. For awards in our sample, we reviewed the signed 

justification and approval document, the acquisition plan, market 

research, and other key information in the contract files. We reviewed the 

justifications for these awards to determine whether the documentation 

met criteria in the FAR for content, timing, approval, and public 

availability. In particular, we assessed whether the justifications were 

clear and contained sufficient information to justify the use of the specific 

authority cited as required by the FAR. As needed, we also discussed the 

selected contracts and orders with contracting officials involved in these 

awards to obtain additional information.

To study how DOD strategies aimed at future competition are changing 

program behavior, we selected a nongeneralizable sample of 10 major 

weapon programs based on responses from these programs to a 

 

6

IDIQ contracts do not procure or specify a firm quantity (other than a minimum or 

maximum) and provide for the issuance of task orders (services) or delivery orders 

(supplies) during the contract period. FAR §§ 16.501-1;16.504. Multiple award IDIQ 

contracts are awarded to multiple contractors through one solicitation. When awarding 

multiple-award IDIQ contracts, generally the contracting officer must provide each 

contractor a fair opportunity to be considered for each order, with certain statutory 

exceptions which must be documented in writing. For task orders not subject to fair 

opportunity, including those on single award IDIQ contracts, the competition data for task 

orders in FPDS-NG is derived from the competition data for the underlying IDIQ contract.
 

Page 4 GAO-14-395 Defense Contracting

questionnaire developed for GAO’s fiscal year 2013 weapons 

assessment.7 We selected 10 programs that indicated that the program 

may use, will use, or had already incorporated open systems architecture, 

and may acquire, will acquire, or had already acquired a complete 

technical data package.8 We did not select programs that had responded 

that use of open systems architecture or acquisition of technical data 

rights would not take place or the programs that did not respond to these 

questions. We contacted program officials to learn how programs have or 

plan to leverage open systems architecture and the acquisition of data 

rights to promote competition during development and throughout the life 

cycle of the program.

To examine the extent to which DOD’s requirements address the reasons 

why only one offer was received, we reviewed a nongeneralizable sample 

of 15 contracts and task orders. The sample included the largest dollar 

value award from each of the 15 largest product or service categories, 

measured by obligations, made from April 1, 2012 through March 31, 

2013. Only awards for which one offer was received in response to a 

solicitation issued using competitive procedures, as coded in FPDS-NG, 

were included in the sample. For each selected award, we obtained 

evidence of the solicitation issuance and proposal due date, 

documentation of cost or price analysis, and other key information. We 

interviewed contracting officials involved with each award to understand 

the competitive environment for each award and the possible reasons 

why only one offer was received. We also interviewed several vendors 

who had expressed interest in some of these awards but chose not to 

submit offers. We assessed recent DOD implementing regulations to 

determine whether key reasons for one-offer awards were addressed.9

A more detailed description of our scope and methodology is presented in 

appendix I. We conducted this performance audit from May 2013 to 

May 2014, in accordance with generally accepted government auditing 

 

7 GAO, Defense Acquisitions: Assessments of Selected Weapon Programs, 

GAO-13-294SP (Washington, D.C.: Mar. 28, 2013). For that report, we sent a 

questionnaire to 65 defense acquisition programs and sub-elements of programs. 

8 An open systems architecture is a system that uses a modular design, and consensus 

based standards for its key interfaces, which have been tested to ensure their openness.

9

Defense Federal Acquisition Regulation Supplement (DFARS) § 215.371; 77 Fed. Reg. 

39,126 (June 29, 2012).
 

Page 5 GAO-14-395 Defense Contracting

standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives.

The Competition in Contracting Act of 1984 requires agencies to obtain 

full and open competition through the use of competitive procedures in 

their procurement activities unless otherwise authorized by law.10 Using 

competitive procedures to award contracts means that all responsible 

contractors are permitted to submit offers. The FAR generally requires 

agencies to perform acquisition planning and conduct market research to 

promote full and open competition. Generally, noncompetitive awards 

must be supported by written justifications that address the specific 

exception to full and open competition that is being used in the 

procurement.

In addition, federal agencies can establish IDIQ contracts with one or 

more contractors and may issue orders under these contracts. For 

multiple award IDIQ contracts, agencies are generally required by the 

FAR to provide all contractors with an IDIQ contract a fair opportunity to 

be considered for each order above certain dollar thresholds; however, 

agencies can award noncompetitive orders under certain circumstances, 

which generally require a written justification. The General Services 

Administration administers a program that uses IDIQ contracts with 

vendors for commercially available goods and services, and federal 

agencies place orders under the contracts. When doing so 

noncompetitively, the FAR requires procuring agencies to justify the need 

to restrict the number of vendors considered. Finally, agencies can also 

competitively award contracts after limiting the pool of available 

contractors—a process called full and open competition after exclusion of 

sources. For example, agencies are required by the FAR to set aside 

procurements for small businesses if there is a reasonable expectation 

that two or more responsible small businesses will compete for the work 

and will offer fair market prices.

 

10Pub. L. No. 98-369, § 2701.

Background
Page 6 GAO-14-395 Defense Contracting

Justifications generally are to provide sufficient facts or the rationale to 

explain the use of the specific exception to competition. For example, 

under FAR part 6, justifications must include, at a minimum, 12 

elements.11 Examples of these required elements include

• a description of the supplies or services required to meet the agency’s

needs and their estimated value;

• identification of the statutory authority permitting other than full and

open competition;

• a determination by the contracting officer that the anticipated cost to

the government will be fair and reasonable;

• a description of market research conducted, if any; and

• a statement of the actions, if any, the agency may take to remove or

overcome any barriers to competition before any subsequent

acquisitions for the supplies or services required.

Examples of allowable exceptions to full and open competition for DOD 

include circumstances when only one or a limited number of contractors 

are the only sources capable of performing the requirement or when an 

agency’s need is of such unusual and compelling urgency that the 

government would be seriously injured unless the agency is permitted to 

limit the number of sources.12 The FAR generally requires that 

justifications be published on the Federal Business Opportunities 

(FedBizOpps.gov) website and be approved at various levels within the 

contracting organization. These levels vary according to the dollar value 

of the procurement.

Our prior work indicates that a long-standing factor impacting DOD’s 

competition rate is its reliance on original equipment manufacturers. Open 

systems architecture promotes competition by allowing components to be 

added, removed, modified, replaced, or maintained by multiple suppliers, 

not just the manufacturer that developed the system. An open system is 

designed with modular components each having its own functions. This 

11FAR § 6.303-2(b). The FAR requires that justifications for noncompetitive awards under 

Subpart 8.4 (Federal Supply Schedules) and 16.5 (Indefinite-Delivery Contracts) contain 

similar information. See FAR § 8.405-6(c)(2) and FAR § 16.505(b)(2)(ii)(B).

12For additional information on the unusual and compelling urgency exceptions see GAO,

Federal Contracting: Noncompetitive Contracts Based on Urgency Need Additional 

Oversight, GAO-14-304 (Washington, D.C.: Mar. 26, 2014). 

Open Systems 

Architecture and 

Appropriate Data Rights 

Can Help Promote 

Competition
 

Page 7 GAO-14-395 Defense Contracting

design makes the system easier to develop, maintain, and modify 

because components can be changed without significantly impacting the 

remainder of the system.

Likewise, our prior work states that incorporating open systems 

architecture and the acquisition of appropriate data rights, such as design 

drawings, specifications, and standards, during program development can 

result in greater competition and reduce costs during production. Further, 

incorporation of open systems architecture and management of data 

rights can lead to greater competition and reduced upgrade and repair 

costs over a program’s life cycle. But introducing this approach later in a 

program’s life cycle, such as for a planned modification or upgrade, is 

more difficult, complex, and costly to do as it may require significant 

modifications to an already-developed system. Defense systems can 

have a life span of 40 years; figure 1 shows that the greater part of a 

weapon system’s total ownership cost consists of its operating and 

support costs. Early decisions made during design dictate operating and 

support costs over the entire life cycle.

Figure 1: Notional Life Cycle Costs of Typical DOD Acquisition Program
 

Page 8 GAO-14-395 Defense Contracting

DOD’s Better Buying Power initiative outlines a series of actions, 

guidance, and directives to achieve greater efficiencies, in part through 

the promotion of competition, such as the following:

• Each program must present a competitive strategy at each major 

decision point.

• Before starting system development, programs must have a business 

case analysis that outlines an approach for using open systems 

architecture and acquiring data rights to ensure sustained 

consideration of competition in the acquisition of weapons systems.

• Each DOD component is to develop a plan to improve the overall rate 

of competition by at least 2 percent per year, and the rate of effective 

competition—when more than one offer is received under competitive 

procedures—by at least 10 percent per year.

• Justification and approval documents for noncompetitive contracts 

should include a discussion on how the program will take advantage 

of business practices to break away from their reliance on a single 

vendor and improve competition in future acquisitions.

• Updated guidance and directives for open systems architecture and 

the acquisition and management of data rights.

• Developing new training and updated course curriculum on open 

systems architecture and acquisition and management of data rights.

In addition, DOD has termed procurements for which only one offer was 

received under full and open competition as “ineffective competition.” The 

Office of Federal Procurement Policy (OFPP) noted that competitions that 

yield only one offer in response to a solicitation deprive agencies of the 

ability to consider alternative solutions in a reasoned and structured 

manner. In November 2010, DOD introduced a policy containing new 

requirements concerning one-offer awards, and codified it with changes in 

the DFARS in June 2012. See figure 2.

Better Buying Power 

Initiative Promotes 

Competition
 

Page 9 GAO-14-395 Defense Contracting

Figure 2: DOD’s One-Offer Requirements Include Three Rules

a

The program office consultation rule was added when the policy was codified with changes in the 

DFARS. DFARS § 215.371; 77 Fed. Reg. 39,126 (June 29, 2012).

b

The cost/price analysis determination must be approved at a level above the contracting officer 

unless an exception applies. This cost/price analysis rule only applies to solicitations that result in one 
 

Page 10 GAO-14-395 Defense Contracting

offer. Thus, if multiple offers are received after completing the resolicitation rule, then the contracting 

officer should conduct negotiations, if necessary, and finalize the acquisition process.

Last year, we found that the one-offer requirements will likely have a 

limited impact on unnecessarily restrictive solicitation requirements 

because many solicitations provide initial response times of more than 30 

days, so many awards are not subject to the program office consultation 

rule.13 We also found that the impact of recent guidance on the number 

and dollar value of one-offer awards is not quantifiable because of 

unreliable data. As a result, DOD is not in a position to accurately 

measure the impact of the one-offer requirements since it was 

implemented. We recommended that DOD develop an action plan for 

DOD components to collect reliable data on competitive procurements for 

which only one offer is received, so that the department can determine 

the effect of its requirements on one-offer awards. DOD agreed with our 

recommendation. In response, the Air Force established mandatory 

training for personnel responsible for entering this data in the system. 

According to agency officials, DOD is in the process of updating guidance 

on entering data for one-offer awards.

DOD’s competition rate for all contract obligations had been declining 

since 2009; however, the competition rate has remained flat for the past 

2 years. Among the DOD components in our study, the Army had the 

highest competition rate in fiscal year 2013, while MDA had the lowest. 

Based on FPDS-NG data, we found that noncompetitive awards cited 

several exceptions from competitive procedures. We continue to observe, 

as we previously found in 2012 and 2013, that there are a number of 

factors that affect DOD’s competition rate.14 For example, the government 

has historically relied on the original equipment manufacturers of weapon 

systems for future procurements of the system, including sustainment.

Between fiscal years 2009 and 2013, DOD’s competition rate—based on 

all contract obligations—declined by 5 percent, from 62 percent to 57 

 

13GAO-13-325. 

14GAO-13-325; and Defense Contracting: Competition for Services and Recent Initiatives 

to Increase Competitive Procurements, GAO-12-384 (Washington, D.C.: Mar. 12, 2012).

DOD’s Competition 

Rate Remained the 

Same for 2 Years

Competition Rate Has 

Stopped Declining and 

Varies by Component
 

Page 11 GAO-14-395 Defense Contracting

percent, with an average competition rate of 59 percent for the 5 year 

period (see figure 3).

Figure 3: Fiscal Years 2009-2013 Competition Trend

However, the competition rate did not change from fiscal years 2012 to 

2013, remaining at 57 percent. DOD’s total dollars obligated decreased 

by almost $53 billion, from $360.4 billion in fiscal year 2012 to 

$307.5 billion in fiscal year 2013. Competed obligations decreased by 

over $31 billion, from $205.6 billion in fiscal year 2012 to $174.2 billion in 

fiscal year 2013.

We also found that the competition rate for all contract obligations varied 

by DOD component. Of the 4 organizations we reviewed—Air Force, 

Army, Navy, and MDA—in fiscal year 2013, the Army had the highest 

competition rate, 66 percent, whereas MDA had the lowest rate of 

competition, 29 percent, representing a significant decrease from the prior 

year. Figure 4 outlines competition rates by component for fiscal years 

2009 through 2013.
 

Page 12 GAO-14-395 Defense Contracting

Figure 4: Competition Rates by DOD Component for Fiscal Years 2009 through 2013

Note: Other DOD data includes obligations made by any DOD contracting office that are not part of 

the Air Force, Army, MDA, or Navy. These include, but are not limited to: Defense Contract 

Management Agency, Defense Logistics Agency, TRICARE Management Activity, and Defense 

Threat Reduction Agency.

In fiscal year 2013, the Air Force’s competition rate improved to 

41 percent. However, the Air Force reported that it operates in an 

environment where it obligates the majority of its dollars on long standing 

sole-source weapon system contracts, noncompetitive foreign military 

sales, and reduced number of new programs which affects their ability to 

compete.15 The Navy’s competition rate in fiscal year 2013 declined due 

to continued investments in the F-35 Joint Strike Fighter, P-8A Poseidon 

long-range maritime patrol aircraft, and carrier construction.16 The decline 

in MDA’s fiscal year 2013 competition rate is principally the result of a 

noncompetitive $2.7 billion foreign military sale. Last year, we found that 

DOD could gain greater insight into the competition rates if it considered 

 

15Air Force, Air Force Competition Report: Fiscal Year 2013 (Washington, D.C.: January 

2014).

16Navy, Department of the Navy Fiscal Year 2013 Competition Report (Washington, D.C.: 

Mar. 7, 2014).
 

Page 13 GAO-14-395 Defense Contracting

the impact of foreign military sales when calculating the rates.17 When we 

calculated MDA’s competition rate without including foreign military sales, 

we found that the competition rate was 49 percent in both fiscal years 

2012 and 2013.

Slightly more than half of all DOD’s obligations in fiscal year 2013 were to 

purchase services, ($160.3 billion, or 52.1 percent), which were competed 

at a substantially higher rate than products. Specifically, the competition 

rate for services was 73 percent compared to 39 percent for products. 

This trend was generally consistent over the 5-year period from fiscal 

years 2009 through 2013. As shown in figure 5, historically, services have 

been procured at a higher competitive rate than products. In addition, in 

fiscal year 2013, non-research and development (R&D) services were 

competed at a higher competition rate than R&D services, 75 percent 

compared to 65 percent.

 

17We recommended and DOD agreed to identify and track the specific factors that affect 

the competition rate, such as foreign military sales, and consider this information when 

setting annual competition goals for each DOD component. See GAO-13-325. Foreign 

military sales are a form of security assistance authorized by the Arms Export Control Act 

and a fundamental tool of U.S. foreign policy. Eligible countries may purchase defense 

articles and services with their own funds or with funds provided through U.S. 

government-sponsored assistance programs.

Competition Rates for 

Services Substantially 

Higher Than for Products 

with Little Change over 

Time
 

Page 14 GAO-14-395 Defense Contracting

Figure 5: DOD’s Competition Rate and Competitive Obligations for Products, NonR&D Services and R&D Services

The competition rate for non-R&D services at DOD declined from 

81 percent in fiscal year 2009 to 75 percent in fiscal year 2013. Among 

the major components, the Air Force had the most significant decline, 

dropping from 66 percent to 47 percent. MDA increased its non-R&D 

services competition rate from 69 percent to 89 percent.

The 10 largest product and service categories, as reported in FPDS-NG, 

cumulatively accounted for 31 percent of non-competed obligations in 
 

Page 15 GAO-14-395 Defense Contracting

fiscal years 2009 through 2013.18 In fiscal year 2013, these 9 product and 

1 service categories accounted for 38 percent of all non-competed 

obligations and comprised 16 percent of all DOD obligations. In fiscal 

year 2013, 10 percent of obligations for fixed wing aircraft procurements 

were made competitively (see table 1).

Table 1: Ten Product and Service Categories Driving Noncompetitive Obligations for Fiscal Year 2013 (Dollars in Billions)

Product and service categories Total obligations Percent competed

Fixed Wing Aircraft $26.5 10%

Rotary Wing Aircraft 7.2 4 

Guided Missiles 6.8 3 

Combat Ships And Landing Vessels 6.4 49

Submarines 2.9 1 

Guided Missile Components 2.0 1 

Amphibious Assault Ships 1.7 0 

Maintenance, Repair, Rebuilding of Equipment- Aircraft Components 

And Accessories 1.7 26

Wheeled Trucks And Truck Tractors 1.1 6 

Aircraft Carriers 0.7 0 

Source: GAO analysis of FPDS-NG data.

Examples of fixed wing procurements include airframes or components 

for the F-35, C-5, F-22, and C-40B aircraft. Similarly, 4 percent of rotary 

wing and 3 percent of obligations for guided missiles were competed. For 

aircraft carriers, the Navy competition advocate explained that when a 

contract for a very large procurement like an aircraft carrier is awarded, 

the organization’s competition rate declines for that year because these 

types of procurements are made noncompetitively.

Once DOD selects the contractor for a weapon system, such as an 

aircraft, truck, or missile, the government has historically relied on the 

original equipment manufacturers for future procurements of the system, 

 

18The largest categories were identified using the product and service codes that describe 

products, services, and R&D purchased by the federal government in FPDS-NG. These 

codes indicate what was bought for each contract action reported in FPDS-NG. If a 

contract, task order, or purchase order includes more than one product and/or service, the 

product and service codes is selected based on the predominant product or service that is 

being purchased.
 

Page 16 GAO-14-395 Defense Contracting

including sustainment. The additional systems or sustainment are often 

procured through contract modifications or the exercise of contract 

options. This situation is partly attributable to the unique relationship that 

DOD has with the defense industry that differs from the commercial 

marketplace. The combination of a single buyer (DOD), few very large 

prime contractors in each segment of the industry, and a limited number 

of weapon programs constitutes a structure for doing business that is 

altogether different from a classic free market.19 For instance, there is less 

competition and once a contract is awarded, the contractor often remains 

the sole vendor capable of providing additional systems and sustainment. 

These long-term contractual relationships with weapon system 

contractors limit opportunities for competition.

During the past 5 fiscal years, DOD used the “only one responsible 

source” exception for about 64 percent of all awards for new 

noncompetitive contracts and task orders on single award IDIQ contracts. 

The percent obligated on new noncompetitive contracts and task orders 

on single award contracts as reported in FPDS-NG under the “only one 

responsible source” exception has increased—from 66 percent in fiscal 

year 2009 to 72 percent in fiscal year 2013.20 The second largest amount 

(11 percent awarded in fiscal year 2013) cited the “authorized or required 

by statute” exception (see table 2).

 

19GAO, Defense Acquisitions: Where Should Reform Aim Next? GAO-14-145T 

(Washington, D.C.: Oct. 29, 2013).

20Not all orders are subject to fair opportunity, including those on single award IDIQ 

contracts. In these cases, the competition data for task orders in FPDS-NG is derived from 

the competition data for the underlying IDIQ contract. Most fiscal year 2013 DOD 

non-competed obligations on task orders were not coded as subject to fair opportunity in 

FPDS-NG.

Majority of New 

Noncompetitive Awards 

Were Coded As “Only One 

Responsible Source”
 

Page 17 GAO-14-395 Defense Contracting

Table 2: Competition Exceptions for New Fiscal Year 2009 to 2013 DOD Noncompetitive Contracts and Task Orders on Single 

Award Contracts

Dollars in billions

Year

Only one 

responsible sourcea Authorized or 

required by statuteb International agreementc Otherd

Amount Percent Amount Percent Amount Percent Amount Percent

Exceptions

total 

Total new 

obligations

2009 $41.1 65.9 $13.7 22.0 $3.3 5.3 $4.2 6.8 $62.3 $191.8

2010 37.3 63.1 12.8 21.6 4.5 7.7 4.5 7.6 59.1 178.1

2011 36.5 61.6 12.4 20.9 2.6 4.4 7.8 13.1 59.2 173.6

2012 38.1 60.4 11.2 17.8 8.7 13.9 5.0 7.9 63.0 173.5

2013 32.3 72.3 4.9 10.9 3.2 7.2 4.3 9.6 44.7 131.0

Source: GAO analysis of FPDS-NG data.

a

”Only one responsible source” includes contracts and orders placed on single award IDIQ contracts 

that cited the following categories in FPDS-NG: unique source, follow-on contract, patent or data 

rights, utilities; standardizations; only one source-other; and brand name description. FAR § 6.302-1.

b

This exception is used when a statute expressly authorizes or requires that the acquisition be made 

through another agency or from a specified source; or there is a need for a brand name commercial 

item for authorized resale. FAR § 6.302-5.

c

This exception is used when competition is precluded by the terms of an international agreement or 

a treaty between the United States and a foreign government or international organization, or on the 

written directions of a foreign government reimbursing the agency for the cost of the acquisition of the 

supplies or services. FAR § 6.302-4.

d

”Other” includes contracts and orders placed on single award IDIQ contracts that cited the following 

competition exceptions: urgency; industrial mobilization; engineering, developmental or research 

capability; expert services; national security; public interest, FAR §§ 6.302-2, 6.302-3, 6.302-6 and 

6.302-7; and not competed using simplified acquisition procedures under FAR Part 13.

The individual components used the “only one responsible source” 

exception to varying extents—69 percent for the Air Force, 68 percent for 

Army, 80 percent for Navy, and 71 percent for other DOD agencies for 

fiscal year 2013. However, MDA used this exception for 96 percent or 

$137.4 million of the new noncompetitive contracts and task orders it 

awarded in fiscal year 2013.

In fiscal year 2013, the majority of new noncompetitive task orders issued 

under multiple award IDIQ contracts and subject to the fair opportunity 

process reported two exceptions to the fair opportunity process. 

Specifically, “only one source” was cited for 44 percent of obligations 
 

Page 18 GAO-14-395 Defense Contracting

($1.2 billion) and “follow-on actions,” orders for the same good or service 

with the original vendor, was cited for 39 percent ($1.1 billion).21

In general, the documentation for our selected contracts contained the 

required elements in accordance with regulations. Specifically, 11 of the 

14 justifications in our sample contained all the required elements. 

However, our sample also included three justifications that were not 

prepared correctly. Further, four justifications were not made publicly 

available according to requirements, thus missing an opportunity to add 

transparency into the contracting process. Half of the justifications in our 

sample explained that the lack of necessary data rights was a barrier to 

competition. In some cases the justifications provided insight as to how a 

lack of the right level of data rights resulted in complete reliance on a 

single vendor over time.

As required by the FAR, DOD contracting officials prepared written 

justifications for all 14 noncompetitive contract awards in our sample. We 

determined that 11 of the 14 justifications contained all required elements 

and were prepared in accordance with the FAR. For additional details 

about the noncompetitive awards in our sample, see appendix II. Further, 

we found that the justifications generally provided clear explanations of 

the reasons that the procurement could not be competed.22 Documenting 

this information provides insight into why acquisitions were not 

competitive and enables agencies to use that knowledge to help remove 

obstacles to competition in future acquisitions. For example, three 

justifications we reviewed described steps DOD was taking to improve 

competition in the future.

 

21“Follow-on action following competitive initial action” captures awards made under FAR 

§ 16.505(b)(2)(i)(C). Specifically, these awards are “issued on a sole-source basis in the 

interest of economy and efficiency because it is a logical follow-on to an order already 

issued under the contract, provided that all awardees were given a fair opportunity to be 

considered for the original order.” 

22In 2013, we concluded that insight into improving future competition can be gained from 

justifications that provide detailed descriptions of the reasons for the noncompetitive 

award and the actions that the agency could take. We recommended that DOD develop 

guidance to enable components to apply lessons from past procurements to increase 

competition and DOD concurred with this recommendation but has not taken any action at 

this time. See GAO-13-325. 

Justifications 

Generally Were 

Adequate and Many 

Cited a Lack of 

Appropriate Technical 

Data Rights as a 

Barrier to Competition

Justifications Generally 

Contained the Required 

Elements
 

Page 19 GAO-14-395 Defense Contracting

Three justifications were not prepared in full accordance with regulations. 

One Navy justification prepared for an $882,000 contract for helicopter 

support services did not have the signature of the competition advocate.23

In addition, the justification was missing the required information about 

market research conducted and a list of sources that expressed an 

interest in the acquisition. However, the Navy provided a separate market 

research memorandum which explained that the government of the 

country where the helicopter services were needed directed which 

company to use.24 A Navy justification for a $7.2 million award for 

software engineering services did not include the contracting officer’s 

signature certifying that the justification was complete and accurate 

because the signature block was erroneously removed from the 

document. The third justification did not use the correct legal citation for 

the exception to competition and instead referenced an exception that 

was not supported by the facts provided in the justification.

The FAR requires that justifications be made publicly available, generally 

within 14 days of contract award, which increases transparency into the 

contracting process by providing the opportunity for public review of 

justifications for noncompetitive contracts.25 In our sample, five 

justifications were made publicly available within the time frame required 

by the FAR and another justification was exempt from requirements due 

to national security concerns. However, four justifications were never 

made publicly available and four justifications were not made available 

until after the required time frame. DOD acknowledged these as 

oversights.

 

23The FAR requires that the competition advocate for the procuring activity approve the 

justification for any proposed contract action over $650,000 but under $12.5 million. FAR § 

6.304(a)(2).

24The foreign government declared its aviation sector, including operational control of 

airports and airport systems, a national security asset. Therefore, foreign government 

officials must authorize all operations within the territorial jurisdiction within their country, 

and conditioned their approval of U.S. government operations on contracting with a 

helicopter company which is owned or substantially controlled by its government.

25FAR § 6.305(a) Similarly, FAR § 8.405-6(a)(2)(i) generally requires that limited sources 

justifications be made publicly available within 14 days after placing an order.
 

Page 20 GAO-14-395 Defense Contracting

All 14 noncompetitive contracts and task orders within our sample were 

justified under the exceptions for competition of “only one responsible 

source or “only one source capable.”26 For half of these awards, the basis 

for this exception was the agency’s lack of data rights. All 7 of these 

justifications or supporting documents described situations, ranging from 

3 to 30 years in duration, where DOD was unable to conduct a 

competition because data rights were not purchased with the initial 

award. Within these 7 selected awards, justification content varied from 

addressing steps the agency would take to increase competition in the 

future to stating that the agency was taking no action to increase 

competition for these awards. For example:

• The justification for a $7 million Navy award for situational awareness 

and communication software explained that the agency and the 

contractor disagreed about the level of government data rights. The 

justification stated that the agency was negotiating with the contractor 

to obtain adequate data rights to develop a data package that will 

support competition for future acquisitions of software releases.

• The justification for a $3 million MDA award stated that the original 

equipment manufacturer for a cost and requirements management 

software system owned all of the data rights, necessitating a 

noncompetitive award for the system’s maintenance. However, the 

justification explained that the agency planned to end the 

noncompetitive award and transition to a different system by 2017, 

ensuring that necessary data rights are acquired at that time.

• A justification for an almost $6 million Navy contract for spare 

helicopter windshields addressed how the agency would increase 

future competition. The justification explained that the agency planned 

to compete this acquisition in the future by encouraging other vendors 

to submit a complete data package but did not address plans to 

purchase the necessary data. The justification stated that these 

articles are highly specialized and the data required for another 

vendor to manufacture these articles are not available. These parts 

 

26See, FAR § 6.302-1 Only one responsible source and no other supplies or services will 

satisfy agency requirements for authority to issue sole source awards for contracts. See 

also FAR § 8.405-6(a)(1)(i)(B) and § 16.505(b)(2)(i)(B) Only one source is capable of 

providing the supplies or services required at the level of quality required because the 

supplies or services are unique or highly specialized for authority to limit sources for 

orders under Federal Supply Schedules and orders under multiple award contracts. 

Lack of Necessary Data 

Rights Is Frequently a 

Barrier to Competition and 

Results in Reliance on a 

Single Vendor
 

Page 21 GAO-14-395 Defense Contracting

have been continually acquired from the original equipment 

manufacturer for the past 25 years. Including the current 5-year 

contract, the government will have purchased these parts 

noncompetitively for a total of 30 years.

• A justification for a $9.5 million Army contract for M1A1 situational 

awareness tanks stated that the contractor had refused to sell the 

data rights and that the government would take no action to increase 

competition at this time because the government would suffer 

unacceptable delays. The contractor has refused to sell the process 

sheets and associated data needed for the remanufacturing process 

to compete this acquisition. The justification explained that the 

government will post an announcement for this requirement online 

and any bids or proposals will be considered. However, no other 

vendors have ever expressed interest in this acquisition.

The focus on open systems architecture and acquiring effective types of 

data rights is changing the way DOD acquires goods and services. 

Programs are moving away from dependency upon single suppliers for 

parts, maintenance or upgrades and are moving toward open systems; 

these are designed to allow components to be added, removed, modified, 

replaced or maintained by multiple suppliers. The programs we sampled 

illustrate that leveraging open systems architecture and data rights to help 

promote competition involves early consideration and extensive analysis 

of how each system can best use these approaches to maintain a 

competitive environment throughout a program’s life cycle. Likewise, BBP 

fosters behaviors with the intent to promote competition. For example, 

according to program officials the BBP’s emphasis on open systems 

architecture and effective management of data rights resulted in 

increased competition for the Air Force’s Military Global Positioning 

System User Equipment and KC-46 Tanker Modernization programs. 

DOD officials told us that training is an effective way to change patterns of 

behavior and that to promote competition the agency needs an 

acquisition workforce that is educated on the various types of data rights.

Focus on the Use of 

Open Systems 

Architectures and 

Emphasis on Data 

Rights Help to Guide 

Program Behavior
 

Page 22 GAO-14-395 Defense Contracting

Programs report using open systems architecture and acquiring the 

necessary technical data rights to enable competition during development 

and throughout the acquisition life cycle.27 Based on questionnaire 

responses, programs are moving away from proprietary systems and 

toward systems that are designed to allow for future competition. As 

shown in table 3, 24 of the 31 weapons programs that responded to a 

2012 GAO questionnaire reported that they were planning or had already 

used open systems architecture, and 14 of 31 had acquired or planned to 

acquire a complete technical data package.28

Table 3: Responses of 31 Weapon System Programs Regarding Use of Open 

System Architecture and Acquisition of Technical Data Rights 

Program response

Use of modular,

open architectures

Acquisition of

complete technical packages

Already taken place 10 8 

Planned 14 6 

May occur 3 10

Will not take place 4 7 

Total 31 31

Source: GAO Analysis of DOD data.

Note: We sent the questionnaire to 65 defense acquisition programs and sub-elements of programs 

to determine the extent to which programs were implementing acquisition reforms.

The following examples from the 10 programs in our sample illustrate how 

programs have or plan to leverage open systems architecture and 

acquisition of data rights to promote competition during development and 

throughout the life cycle.

• The Air Force has planned for sustained competition for its ThreeDimensional Expeditionary Long Range-Radar program. Program 

officials said that they used open systems architecture to maximize 

competition between multiple vendors and that they plan to acquire 

 

27We previously concluded that DOD does not know the extent to which weapon 

acquisition programs are implementing an open systems approach, and recommended 

that DOD define appropriate metrics to track its implementation. DOD partially concurred 

but has taken no action to date. GAO, Defense Acquisitions: DOD Efforts to Adopt Open 

Systems for Its Unmanned Aircraft Systems Have Progressed Slowly, GAO-13-651 

(Washington, D.C.: July 31, 2013).

28GAO-13-294SP. 

Some Programs Already 

Promote Competition with 

Open Systems and Data 

Rights
 

Page 23 GAO-14-395 Defense Contracting

data rights to address long‐term sustainment and competition for 

future upgrades to the system. Further, the program is expected to 

require the contractor to clearly define and describe all component 

and system interfaces and ensure that this information is both 

accurate and available to other potential vendors. Specifically, all 

documentation that defines a component’s form, fit, function, and 

integration is to be delivered to the program with unlimited rights at a 

level of detail that will provide a developer, with comparable levels of 

expertise, the ability to further develop the system component.

• The Army Integrated Air and Missile Defense program began 

development in 2006. Open systems architecture and the acquisition 

of appropriate data rights were key components since the program’s 

conception. Program officials we spoke with stressed that open 

systems architecture is a key tenet for the evolution of the air and 

missile defense sensors and that decisions to incorporate open 

systems architecture and acquire data rights need to be made very 

early in program development. Early incorporation will enable the 

Army Integrated Air and Missile Defense to compete future production 

both at the system level and at the subsystem level. For example, the 

program is designed so that the most current technology can be 

inserted into just one component of the system through a competitive 

acquisition without having to make any changes to any other parts of 

the system. This design will allow the program to compete either the 

entire system or subcomponents when the system goes into 

production.

• Program officials at MDA’s Ground Based Midcourse Defense 

program conducted extensive data rights analysis and subsequently 

acquired all technical data required for successful competition of the 

development and sustainment contract. Specifically, the program 

released thousands of documents into a technical data library to be 

used by vendors that plan to bid on program contracts. Additionally, 

according to the program office, the contract includes language to 

ensure that future data are not limited or restricted to the government 

without prior written authorization from the procuring contracting 

officer.

• The Ship to Shore Connector program is the first naval acquisition 

program in more than 15 years to be designed in house by the Navy 

instead of by private industry. Officials from the program told us that 

because the program is responsible for the entire life of the Ship to 

Shore Connector program that all aspects of acquisition, including 

open systems architecture and the acquisition of technical data for 
 

Page 24 GAO-14-395 Defense Contracting

lifecycle support of the craft was accounted for during the design 

process. Because of the lifecycle responsibility, they said that it is 

important for critical data not to become obsolete so a modular 

approach using standard interfaces was implemented to enable 

maintenance and support, and prevent obsolescence issues, where 

feasible. The program is procuring a technical data package in 

support of the program’s long-term technical data requirements for 

design, manufacture and sustainment. The data package is to support 

re-competition for production, sustainment and upgrades and will 

allow the future craft builder to contract with vendors to build 

components where the original contractor was also the manufacturer 

of the component.29

DOD’s BBP initiative is intended to improve DOD’s use of open systems 

architecture and effectively manage technical data rights. This is 

important given the relatively lower rate of competition for products 

(39 percent) compared to services (73 percent) from fiscal year 2009 

through 2013. We found that BBP has affected decision making of some 

weapons programs in the use of open systems architecture and 

acquisition of technical data rights that enable competition throughout a 

program’s life cycle. Specifically, we identified two instances when major 

weapon system program offices were influenced by BBP to make 

changes that would promote competition:

• According to officials at the Air Force’s Military Global Positioning 

System User Equipment program, BBP led them to consider how 

open systems architecture and data rights could be used to obtain 

greater competition throughout the program’s sustainment. Program 

officials told us, that because of BBP, the program revised its 

Technical Development Strategy document to include the program 

requirement for contractors to implement open systems architecture 

principles and provide unlimited rights to technical and manufacturing 

data and government purpose rights to remaining non-commercial 

technical data licenses.30 We found evidence of these changes in the 

 

29 For information on the status, cost, schedule, and quantity of these and other 

acquisition programs see GAO, Defense Acquisitions: Assessments of Selected Weapon 

Programs, GAO-14-340SP (Washington, D.C.: Mar. 31, 2014).

30Government purpose rights permit the government to use, modify, reproduce, release, 

perform, display, or disclose technical data within the government without restriction and 

permit the release or disclosure of technical data to third parties for government purposes 

only. 

DOD Initiative Continues 

to Encourage Use of Open 

Systems Architecture and 

Data Rights
 

Page 25 GAO-14-395 Defense Contracting

program’s Technology Development Strategy. This document was 

required at the decision point prior to the technology development 

phase of the defense acquisition process, and it includes a summary 

of how the program anticipates meeting the product life-cycle data 

rights requirements and supporting the overall competition strategy.

• The BBP’s emphasis on effective management of technical data rights 

resulted in improvements for the KC-46 tanker modernization 

program’s efforts to increase competition and reduce costs over the 

program’s life cycle. In particular, the Air Force conducted an analysis 

of the FAR, the DFARS and applicable intellectual property laws to 

ensure that the program acquired the sufficient data and licensing 

rights, including data, for operations, maintenance, installation, and 

training. The program obtained the operations, maintenance, 

installation, and training data for a fixed price and these data rights 

should allow the agency to maintain the system and compete both the 

development of the training systems and the reprocurement package 

for another system component. The Air Force was able to obtain the 

rights for the operations, maintenance, installation, and training data 

because the program required offerors to price data and include open 

systems architecture and standard interfaces to the maximum extent 

practical for a commercial derivative military aircraft.

DOD officials also told us that training is a highly instrumental way to 

change patterns of behavior and that to promote competition, the agency 

needs an acquisition workforce that is educated on types of data rights. In 

2013, as required by the BBP, the Defense Acquisition University 

released a series of seven continuous learning modules focused upon 

data management to provide fundamental knowledge required for 

acquisition professionals to create better data management plans and 

obtain necessary types of data rights in defense systems. This training 

builds upon the continuous learning module released in 2012 to introduce 

open systems architecture principles to acquisition professionals.

To advance the agency’s knowledge of types of data rights, DOD has 

issued two updated guidance documents as required by the BBP and is 

developing further guidance that emphasizes the importance of creating 

and maintaining a competitive environment in order to improve DOD’s 

competitive posture:

• The Data Rights Brochure explains differences in types of data rights 

categories and the importance of anticipating the need for data and 
 

Page 26 GAO-14-395 Defense Contracting

data rights. It also provides guidance to assist in identifying and 

resolving data rights issues prior to contract award.

• The Open Systems Architecture Contract Guidebook for Program 

Managers is to be used by the acquisition community to incorporate 

principles and practices of open systems architecture in the 

acquisition of systems or services. For example, this guidebook 

provides contract language to capture open architecture and an open 

business model to increase opportunities for competition, 

recommendations for writing a contract data requirements list and a 

statement of work that is based upon open systems architecture.31 It 

also contains instructions for obtaining effective levels of data rights to 

support full life-cycle competition. DOD officials emphasized that while 

the guidebook can assist program managers with including 

appropriate language into contracts, without the proper technical 

expertise, unsuitable language for the program could be chosen from 

the guidebook and be inserted into a contract.

We previously concluded that incorporating open systems architecture 

into a program requires a highly knowledgeable workforce; further, we 

made a recommendation that DOD assess service-level and program 

office capabilities relating to an open systems approach and develop 

short-term and long-term strategies to address any capability gaps 

identified. Strategies could include the Navy’s cross-cutting approach 

where a team of a few technical experts within the Naval Air Systems 

Command could be available to work with program offices, as necessary, 

to help develop open systems plans.32

 

31An open business model is a key component of open systems architecture. It requires 

conducting business transparently to leverage collaborative innovation of numerous 

participants. It fosters shared risk, maximized asset reuse, and reduced total ownership 

costs. An open business model allows for open systems architectures that yield modular, 

interoperable systems allowing components to be added, modified, replaced, removed 

and/or supported by different vendors throughout the life cycle in order to drive 

opportunities for enhanced competition and innovation.

32DOD partially concurred with this recommendation but did not explain its position or 

what, if anything, it would do in response. GAO-13-651. 
 

Page 27 GAO-14-395 Defense Contracting

In 2010, DOD introduced new requirements for when full and open 

competition results in only one offer; however, these rules, as 

implemented in the DFARS, are focused late in the acquisition process 

and DOD officials have limited insight into the reasons only one offer was 

received. The one-offer awards we reviewed complied with DOD’s rules 

which require contracting officers to ensure solicitation periods allow at 

least 30 days for receipt of proposals and to conduct cost or price 

analysis. But these steps occur too late to impact competition, and 

actions can be taken much earlier in the acquisition planning process to 

encourage multiple offers. DOD contracting officials and vendors told us 

that engagement well before the 30-day solicitation period is key to 

ensuring vendors have adequate time to review draft requests for 

proposals, plan resources, provide feedback on potentially restrictive 

requirements, and determine through internal management processes 

whether it is worthwhile to prepare proposals. Limited information is 

available about reasons why only one offer is received because 

contracting teams seldom collect information from vendors, which could 

limit DOD’s ability to adjust acquisition strategies appropriately and plan 

for future acquisitions.

The contracts and task orders we reviewed that were competed but 

received only one offer complied with DOD’s rules, nevertheless DOD 

continues to obligate significant amounts on one-offer awards. 

Specifically, in fiscal year 2013, DOD obligated a total of $22.6 billion on 

one-offer awards, or 13 percent of all competed fiscal year 2013 

obligations.33 The Army and the Navy had the highest one-offer rates 

(21.1 percent and 17.5 percent of competed obligations respectively). 

MDA had the lowest one-offer rate (1.3 percent). The Air Force’s rate was 

8.6 percent. In total, DOD awarded about 108,000 one-offer awards—

about 1 percent of all new competed awards—and of these almost half 

were awarded by the Defense Logistics Agency. Across DOD, 

approximately 9,300 one-offer awards were valued above the simplified 

acquisition threshold—generally $150,000, below which the one-offer 

rules would not apply.

 

33We cannot compare fiscal year 2013 to prior years to determine a change in one-offer 

awards because we found earlier data to be too unreliable. GAO-13-325. 

DOD’s One-Offer 

Requirements Are 

Focused Late in the 

Acquisition Process

Recent Guidance Is Being 

Followed
 

Page 28 GAO-14-395 Defense Contracting

The awards in our review followed the one-offer rules regarding 

solicitation periods and cost or price analysis, but none were subject to 

the program office consultation rule—that the contracting officer consult 

with the program office to determine whether requirements should be 

modified to promote more competition. For additional details on the 

competitive one-offer awards we reviewed, see appendix III. Contracting 

officials told us that they almost always keep solicitations open for at least 

30 days, and have done so since before the one-offer rules were 

established. They also noted that it was standard practice to grant 

extensions if a vendor requested one. Twelve of the 15 awards we 

reviewed were initially open for 30 days or more. Of the remaining 

3 awards:

• Two Army awards were not subject to the rules per an exemption for 

contingency, humanitarian, or peacekeeping operations.34

• An Air Force award for software development and support was only 

open for 29 days due to miscounting the number of days, and 

received a waiver from the resolicitation rule.

None of the awards we reviewed were subject to the June 2012 rule 

requiring contracting officers to consult with program offices regarding 

whether requirements should be modified to promote more competition. 

For two of the awards we reviewed, however, teams re-assessed 

requirements even though they were not required to do so. In one award 

that was exempt from the one-offer rules, the Army re-evaluated and 

changed its requirements to enhance competition and to address funding 

concerns. For another award which was initially open for 30 days, so not 

subject to the program office consultation rule, the Navy reassessed 

requirements because a potential offeror questioned whether the 

requirements were overly restrictive. Contracting officials subsequently 

determined they were not. However, neither of these awards received 

more than one offer.

All 15 awards we reviewed complied with the rule to conduct cost or price 

analysis when only one offer is received. In four awards, DOD was able to 

negotiate lower prices as part of this process, decreasing costs between 

$1 million and $10 million, or 2 to 10 percent of total contract value. Even 

when only one offer is received, the government may still obtain some of 

 

34DFARS § 215.371-4(a)(2). 
 

Page 29 GAO-14-395 Defense Contracting

the benefits of competition—particularly if the sole offeror is not aware 

that no other offers were received. In most cases, contracting officials 

said they thought the incumbents likely expected other vendors to offer 

proposals. There were several predecessor contracts that had multiple 

offers and, in other cases, solicitation time frames were extended at the 

request of a different vendor. In another instance, the vendor accepted 

contract terms, including government purpose data rights, which it had 

not accepted under a previous noncompetitive award. In addition, the 

vendor took a greater share of the financial risk for cost overruns than in 

the previous sole-source environment. Contracting officials also said they 

felt that the offered prices reflected a competitive market. For example, in 

six cases, offered prices were 4 to 26 percent lower than the government 

estimates.

DOD’s requirements for competitions that result in only one offer do not 

focus on the acquisition planning phase when vendors’ initial engagement 

with government and internal business decision processes occur. Rather, 

the steps outlined in the one-offer rules all occur after the solicitation is 

published, which marks the end of the acquisition planning phase. 

Generally, the contracting officials for our cases did not feel that the 

length of time the solicitation was open was a reason only one offer was 

received, particularly because almost all of them were open for 30 days or 

more. In several cases, vendors requested more time and the contracting 

office extended the solicitation period beyond the initial 30 days, but the 

vendor still did not submit an offer. Vendors explained that they often 

have made their decisions whether to bid or not before the final request 

for proposals is published and the 30-day solicitation period begins. For 

example, in one case, contracting officials told us that a vendor they had 

expected to compete called 2 weeks before the solicitation was posted to 

tell them they had decided not to submit an offer because they were 

reserving their resources to bid on another agency’s contract.

We spoke with some of the vendors identified in market research that did 

not submit offers for the awards we reviewed. Vendor representatives 

explained to us that the likelihood of their company choosing to make an 

offer is increased when they learn of a potential opportunity as early as 

possible and can engage with the government during the acquisition 

planning phase before the solicitation is issued. For instance, when 

sufficient time is allowed, vendors can discuss draft requirements 

documents with the government to identify any language that might 

unnecessarily preclude their solution from being considered. Further, 

vendors need adequate time to conduct internal discussions and analysis 

One-Offer Requirements 

Are Directed at Steps That 

May Occur Too Late in the 

Acquisition Process to 

Meaningfully Enhance 

Competition
 

Page 30 GAO-14-395 Defense Contracting

about what they might offer that could compete successfully against an 

incumbent. There are also internal management reviews and decision 

points prior to approval to submit an offer.

Contracting officials we spoke to identified a number of actions they 

generally take to try to increase competition, many of which come early in 

the acquisition planning phase. They also stressed that early 

communication with industry about planned procurements is critical to 

give industry enough time to plan resources and make business decisions 

about whether to prepare an offer. Additional actions identified include the 

following:

• Reviewing requirements internally during the presolicitation phase to 

ensure that they are not overly restrictive, including legal review.

• Publishing draft requests for proposals and statements of work. For 

three awards we reviewed, officials published draft documents more 

than 6 months in advance of the solicitation. Contracting officers said 

that the questions received from industry in the draft phase help

ensure requirements were not written too restrictively.

• Holding industry days, which also allow subcontractors to find teaming 

partners.

• Allowing access to a “bidders library” of technical data and drawings 

to even the playing field with the incumbent contractor.

• Allowing for a long transition period to signal an ability and willingness 

to bring on a new contractor.

• Limiting information requested from vendors to decrease the burden 

of preparing proposals.

Previously, we found that allowing enough time in the acquisition planning 

process—before a solicitation is published—is important to help ensure 

adequate competition. In 2010, we found that program officials play a 

significant role in the contracting process—particularly in the acquisition 

planning process while developing requirements, performing market 

research, and interfacing with contractors—which can influence 

competition.35 Contracting officials noted that program offices sometimes 

do not allow enough time to execute a sufficiently robust acquisition

planning process that could increase opportunities for competition. They 

 

35GAO, Federal Contracting: Opportunities Exist to Increase Competition and Assess 

Reasons When Only One Offer Is Received, GAO-10-833 (Washington, D.C.: July 26, 

2010). 
 

Page 31 GAO-14-395 Defense Contracting

told us that program offices are insufficiently aware of the amount of time 

needed to properly define requirements or conduct adequate market 

research. In 2011, we found that none of the agencies we reviewed had 

measured or provided guidance on the time required to perform key steps 

during the presolicitation acquisition planning phase.36 We recommended 

that they collect information needed to establish time frames for when 

program officials should begin acquisition planning. The agencies we 

reviewed had varied responses to this recommendation and one agency 

has taken initial steps to establish these time frames.

When a long-standing incumbent contractor has been performing well, 

contracting officials said that vendors do not perceive a good chance of 

winning regardless of the government’s desire for competition and 

therefore do not bid. Contracting officials told us that the most common 

questions they get during the solicitation period are about who the 

incumbent is and whether their performance has been satisfactory. In 

addition, contracting officials said vendors are selective about making 

offers to keep proposal costs—which factor into their overhead rates—low 

in order to remain competitive on other awards.

In making their business decisions about whether or not to submit offers, 

vendors told us that they look for signals about whether the government is 

willing to accept some risk by replacing the incumbent. For example, for 

one award we reviewed, the solicitation included a 6-month transition 

period in an attempt to signal to vendors that the program was willing to 

take the time to bring a non-incumbent vendor on board. For another 

contract we reviewed, a vendor told us they did not submit an offer 

because—based on interactions with government in the acquisition 

planning phase—they believed government was unwilling to take risks 

with the program that might be introduced by bringing in a new solution, 

and therefore the vendor’s chances of unseating the incumbent were too 

low to justify the expense of putting together a proposal. In addition, other 

vendors have told us they also consider various factors before submitting 

a proposal, such as: the cost of developing proposals; their ability to 

provide the services; rapport with the government personnel; and the 

potential financial gain from the procurement.37

 

36GAO, Acquisition Planning: Opportunities to Build Strong Foundations for Better 

Services Contracts, GAO-11-672 (Washington, D.C.: Aug. 9, 2011).

37GAO-10-833. 
 

Page 32 GAO-14-395 Defense Contracting

Federal internal control standards call for managers to identify, analyze, 

and decide what actions should be taken to manage risk.38 For 

competitive acquisitions, this would include the risk that only one offer 

might be received. For the awards we reviewed, however, contracting 

officers seldom collected information about reasons only one offer was 

received, which could limit their ability to revise acquisition strategies 

appropriately or plan for future competitive acquisitions. In most cases, 

contracting officials anticipated they would receive more than one offer 

and told us they were surprised that they only received one offer. 

However, in 11 of 15 awards we reviewed, contracting officials did not 

have information from non-bidding vendors to understand why they chose 

not to submit an offer. For instance, according to the program director for 

one award, MDA has very limited insight into the reasons vendors choose 

not to submit offers. However, although they said they had been very 

surprised that only one offer was received, MDA officials responsible for 

this award had not followed up with the other potential vendors identified 

in the almost 2 years they had been preparing for competition. There is 

no requirement to engage with the vendor community to learn why they 

chose not to submit offers.

In October 2009, OFPP issued guidance to help federal acquisition 

leaders evaluate the effectiveness of their agencies’ competition 

practices. The guidance included recommendations to engage the 

marketplace to determine how barriers to competition can be removed. 

This guidance recommended that agencies encourage their contract and 

program staff to speak to vendors, including leading competitors and 

others that expressed interest in the procurement, but ultimately did not 

submit offers to understand the basis for their decision not to participate. 

In 2010, we recommended that OFPP determine whether the FAR should 

be amended to require agencies to regularly review and critically evaluate 

the circumstances leading to only one offer being received and to identify 

additional steps that can be taken to increase the likelihood that multiple 

offers will be submitted.39 OFPP agreed with our recommendation but, to 

date, has not taken steps to implement it. In addition, DOD has not 

conducted a formal study of the reasons only one offer is received and 

the one-offer rules do not reflect this type of evaluation.

 

38GAO, Standards for Internal Control in the Federal Government, GAO/AIMD-00-21.3.1

(Washington, D.C.: November 1999).

39GAO-10-833. 

DOD Officials Have 

Limited Insight into 

Reasons Only One Offer 

Was Received
 

Page 33 GAO-14-395 Defense Contracting

Understanding the reasons only one offer was received can inform 

whether to revise acquisition strategies going forward. In two cases, 

contracting teams collected information from vendors that did not bid to 

understand what the reasons were. For one award, the contracting office 

requested additional information from the eight vendors with “no bid” 

responses on a multiple award task order contract. Six vendors felt they 

did not have the experience necessary to meet the requirements, and two 

vendors stated that they were partnering with the sole offeror as 

subcontractors. In another case, contracting officials did not reach out to 

potential bidders, but observed from the proposal that they had teamed 

with the sole offeror as subcontractors instead of choosing to compete. In 

the other instance, contracting officials said they learned that some 

vendors were in a teaming relationship with the incumbent that they did 

not want to jeopardize. Officials said that another vendor explained the 

release of this solicitation coincided with 24 other solicitations, and that if 

this solicitation had come out later it would have made it easier for them 

to submit an offer. Based in part on this information, the Navy changed 

their acquisition strategy to decrease the period of performance from 

5 years to 2 years, allowing for another competition sooner than planned. 

Officials told us they may make other changes to the acquisition strategy 

for the next procurement as well, including breaking the requirement into 

pieces and using different contract vehicles. In contrast, we reviewed 

another award that was initially planned to be a multiple award task order 

contract, under which competition would continue on future task orders. 

When only one offer was received, DOD went forward and awarded a 

single award task order contract, with 1 base year and 4 option years.40

Under this arrangement, the agency will not get the benefit of additional 

competition for task orders.

In several instances, too much time had passed for vendors to provide us 

with information about the reasons they chose not to bid on our selected 

contracts, either because the individuals involved were no longer with the 

company or because they could not recall the specific cases. With 

workforce turnover in the government and industry, the best time to 

collect information about the reasons vendors do not submit offers is 

 

40After making the determination that the option is the most advantageous method of 

fulfilling the government’s need, price and other factors considered, contracting officers 

are authorized to exercise options without additional competition. FAR 17.207(c).
 

Page 34 GAO-14-395 Defense Contracting

likely before or soon after award.41 This may be less important if the 

requirement is not anticipated to re-occur in the future. For instance, we 

reviewed two awards where contracting officials told us they did not seek 

information about the reasons only one offer was received because they 

expected these to be the last contracts awarded for these requirements.

DOD’s goal is to increase competition annually and strengthen 

competition in its acquisition of products and services. Half of the 

justifications we reviewed stated that the lack of technical data rights 

resulted in a barrier to competition. DOD’s BBP initiative requires 

programs to outline an approach to manage its data rights needs and to 

use open systems architecture where feasible. This should help DOD to 

obtain the appropriate data rights and use open systems architecture to

increase competition throughout a program’s life cycle to save taxpayer 

dollars while providing the best available technology to the warfighter.

DOD also has established a goal of increasing effective competition—

where competitive procedures are used and more than one offer is 

received. However, the department will have difficulty accomplishing this 

goal without focusing its attention on factors that impact vendor business 

decisions. DOD’s current regulations help decrease some of the risks of 

one-offer awards, but focus on steps that occur too late in the process to 

effectively engage industry in competition. Enhancing the department’s 

acquisition planning guidance to ensure enough time and attention are 

provided for early vendor engagement could help encourage multiple 

offers. There will always be instances when the government cannot 

change vendors’ business decisions. However, the department is less 

able to make an impact on future acquisitions—or to adjust current 

acquisition approaches—for specific procurements if it lacks information 

about the reasons vendors chose not to submit offers. The department 

could mitigate the risk of future limitations on competition by seeking 

more information in certain cases, such as for high dollar value 

procurements or when it is likely the agency will repeat the procurement 

in the future.

 

41We found that agencies miss opportunities to improve acquisition planning when they do 

not document lessons learned. See GAO-11-672. 

Conclusions
 

Page 35 GAO-14-395 Defense Contracting

We recommend that the Secretary of Defense take the following two 

actions to continue to enhance competition:

• Ensure that existing acquisition planning guidance promotes early 

vendor engagement and allows both the government and vendors 

adequate time to complete their respective processes to prepare for 

competition.

• Establish guidance for when contracting officers should assess and 

document the reasons only one offer was received on competitive 

awards, including reviewing requirements to determine if they are 

overly restrictive and collecting feedback from potential vendors about 

the reasons they did not submit offers, taking into account dollar value 

and the likelihood the requirement is a recurring need.

We provided a draft of this report to DOD for review and comment. In 

written comments, DOD concurred with our recommendations. DOD’s 

comments are reprinted in appendix IV. In responding to the first 

recommendation, DOD plans to issue guidance to acquisition planners to 

provide sufficient time for the vendors to review requirements and interact 

with government officials. We agree that it is important for DOD to 

effectively engage industry early in the acquisition process to mitigate 

factors that may hamper competition. In concurring with our second 

recommendation, the department agreed to provide guidance to 

contracting officers on the need to obtain feedback from vendors who

expressed interest during the market research phase of competitive 

solicitations, but did who not submit a proposal. We believe that it is 

important that DOD assess and document the reasons only one offer was 

received on competitive awards, because doing so could help to promote

future competition. DOD also provided technical comments that were 

incorporated, as appropriate.

We are sending copies of this report to the appropriate congressional 

committees and to the Secretary of Defense. This report will also be 

available at no charge on the GAO website at http://www.gao.gov.

If you or your staff have any questions concerning this report, please 

contact me at (202) 512-4841 or by e-mail at woodsw@gao.gov. Contact 

points for our Offices of Congressional Relations and Public Affairs may 

Recommendations for 

Executive Action

Agency Comments

and Our Evaluation
 

Page 36 GAO-14-395 Defense Contracting

be found on the last page of this report. Staff who made key contributions 

to this report are listed in appendix V.

William T. Woods

Director, Acquisition and Sourcing Management
Appendix I: Objectives, Scope, and 

Methodology

Page 37 GAO-14-395 Defense Contracting

The objectives for this review were to examine (1) the trends in DOD’s 

use of competitive awards, (2) the extent to which justifications for

exceptions to competitive procedures were adequate and the reasons for 

the exceptions, (3) how DOD’s strategies aimed at promoting long-term 

competition are changing behavior, and (4) the extent to which DOD’s 

recent requirements address the reasons why only one offer was 

received for competitive solicitations.1

To address these objectives, we used data in the Federal Procurement 

Data System-Next Generation (FPDS-NG), which is the government’s 

procurement database. We assessed the reliability of FPDS-NG data by 

(1) performing electronic testing of required data elements, (2) reviewing 

existing information about the data and the system that produced them, 

and (3) comparing reported data to information from the contract files we 

sampled. We determined that the data were sufficiently reliable to 

examine the trends in DOD’s use of noncompetitive awards and the 

factors influencing DOD’s competition rate, including the number of 

awards, dollar amount obligated, and the percentage of contracts 

awarded competitively overall and by component.

To further examine the trends in DOD’s use of noncompetitive awards, 

we used data from FPDS-NG to identify DOD obligations under 

competitive and noncompetitive contracts from fiscal year 2009 through 

2013, the five most recent years for which complete data were available. 

For the purposes of this report, we defined noncompetitive obligations to 

include obligations through contracts that were awarded using the 

exceptions to full and open competition listed in Federal Acquisition 

Regulation (FAR) Subpart 6.3 (Other than Full and Open Competition). 

We also included noncompetitive orders issued under multiple award 

indefinite delivery/indefinite quantity contracts or under the General 

Service Administration’s schedules program. Specifically, we identified 

contracts and task orders funded and contracted by DOD. For competitive 

contract actions, we included contracts and orders coded as “full and 

open competition,” “full and open after exclusion of sources,” and 

“competed under simplified acquisition procedures” as well as orders 

coded as “subject to fair opportunity” and as “fair opportunity given,” and 

“competitive set aside.” For noncompetitive contract actions, we included 

 

1

For the purposes of this report, we defined adequate justifications as those containing the 

required elements in accordance with Federal Acquisition Regulation.

Appendix I: Objectives, Scope, and 

Methodology
Appendix I: Objectives, Scope, and 

Methodology

Page 38 GAO-14-395 Defense Contracting

contracts and orders coded as “not competed,” “not available for 

competition,” and “not competed under simplified acquisition procedures,” 

as well as orders coded as an exception to “subject to fair opportunity”, 

including “urgency,” “only one source,” “minimum guarantee,” “follow-on 

action following competitive initial action,” “other statutory authority,” and 

“sole source.”

2 We calculated competition rates as the percentage of 

obligations on competitive contracts and orders over all obligations on 

contracts and orders annually. We examined the competition rate at the

DOD level and at four components: Air Force, Army, Missile Defense 

Agency (MDA), and Navy from fiscal year 2009 through 2013. We also 

reviewed competition reports published by DOD and the military services.

In addition, to obtain insight into what was being purchased 

noncompetitively we analyzed product service codes data for the 

products or services that has the highest noncompetitive obligations. 

These codes indicate what was bought for each contract action reported 

in FPDS-NG. We calculated the competition rate as the dollars obligated 

annually on competitive contracts and orders as a percentage of dollars 

obligated on all contracts and orders. For fiscal years 2009 through 2013, 

we analyzed the competition rate for products, non-research and 

development (R&D) services, and R&D services. Also, we identified 

FPDS-NG data to determine the impact of foreign military sale (FMS) 

awards on DOD’s and the components’ competition rates. For FMS 

awards, we included contracts and orders coded as “foreign funds FMS” 

in FPDS-NG. We also assessed the exceptions cited in FPDS-NG for 

new noncompetitive DOD contracts and task orders in fiscal years 2009 

through 2013.

To review the extent to which justifications for exceptions were adequate 

and the reasons for the exceptions, we examined the FAR Part 6 

(Competition Requirements), Subpart 8.405 (Ordering Procedures for 

Federal Supply Schedules), and Subpart 16.505 (Indefinite-Delivery 

Contracts, Ordering). To determine if recent justification documents 

complied with these requirements, we randomly selected 15 contracts 

and orders coded as noncompetitive in FPDS-NG. Specifically, we 

identified the two-digit product service code categories with the highest 

dollar obligations. We then randomly selected one contract or task order

 

2

We also included as noncompetitive contracts and orders where the extent competed 

were coded as “follow-on to competed action,” which was only available for DOD on 

awards made prior to fiscal year 2004.
Appendix I: Objectives, Scope, and 

Methodology

Page 39 GAO-14-395 Defense Contracting

for each of these 15 product service codes from April 1, 2012, through 

March 31, 2013. We ensured that our selection contained only contracts 

or orders with a base and options values exceeding $650,000 and that it 

included at least one award from the Air Force, Army, MDA, and Navy.

We also excluded from our review contracts or orders awarded under 

simplified acquisition procedures and noncompetitive orders that were not 

subject to multiple award fair opportunity as well as exceptions that do not 

require a justification, such as international agreements. Our sample was 

reduced to 14 when we removed 1 contract because it was miscoded. 

Our final sample included 3 Air Force awards, 5 Army awards, 1 MDA 

award, and 5 Navy awards. See appendix II for more details on the 

selected noncompetitive awards.

For the awards in our sample, we requested and reviewed the signed 

justification and approval documents and additional documentation in the 

contract files, including the first page of the signed contract, acquisition 

plan, price negotiation memorandum, documentation of market research, 

and statement of work/performance work statement and documentation, if 

any, that the justification was posted on Federal Business Opportunities 

website including the dates posted.3 We assessed justifications and 

additional documentation for the 14 selected contracts or task orders 

against elements in the FAR such as content, timing, approval, and public 

availability. As needed, we contacted contract officials involved with 

awarding these contracts to obtain additional information so we could 

better understand the analysis conducted that resulted in the decision to 

award these contracts or orders noncompetitively.

To study how DOD’s strategies aimed at promoting long-term competition 

are changing behavior we selected a nongeneralizable sample of 10 

major weapons systems programs. Our selection was based on 31 

responses received from program offices on a questionnaire developed 

for GAO’s fiscal year 2013 weapons assessment.4 We analyzed the 

survey responses for programs received for that report, where sent a 

questionnaire to 65 defense acquisition programs and sub-elements of 

 

3

The General Services Administration is responsible for the operation and maintenance of 

the Federal Business Opportunities system and website, which allows vendors to review 

business opportunity notices with the government.

4

GAO, Defense Acquisitions: Assessments of Selected Weapon Programs, 

GAO-13-294SP (Washington, D.C.: Mar. 28, 2013).
Appendix I: Objectives, Scope, and 

Methodology

Page 40 GAO-14-395 Defense Contracting

programs to determine the extent to which programs were implementing 

acquisition reforms. We selected 10 programs that had responded that 

the program may use, will use, or had used open system architecture, 

and also responded that the program may acquire, will acquire or had 

acquired technical data. We did not select programs that had responded 

that use of open systems architecture or acquisition of technical data 

rights would not take place or the programs that did not respond to these 

questions. We selected five major defense acquisition programs and five 

future major defense acquisition programs. Further, we made certain that 

our sample contained programs from the Air Force, Army, Navy, and 

MDA. To learn how these programs are using open systems architecture 

and acquiring effective data rights to promote competition, and what 

informed the process that led to these decisions, we contacted officials 

from each program to request interviews and we reviewed program 

documents. We also interviewed officials from the Office of the Secretary 

of Defense and the Office of the Secretary of the Navy on the use of open 

systems architecture and acquiring effective data rights. In addition, we 

interviewed competition advocates at the Air Force, Army, MDA, and 

Navy to discuss recent initiatives to promote long-term competition. We 

did not evaluate the entire program or the outcome of actions described 

to increase future competition.

To examine the extent to which DOD’s requirements address the reasons 

why only one offer was received for competitive solicitations, we 

examined DOD policies, regulations, and other related documents. To 

determine whether recent awards complied with the requirements, we 

reviewed a nongeneralizable sample of 15 contracts and task orders. 

Only awards for which one offer was received in response to a solicitation 

issued using competitive procedures, as coded in FPDS-NG, were 

included in the sample. The sample included the largest dollar value 

award from each of the 15 largest product service categories, measured 

by obligations, made from April 1, 2012, through March 31, 2013. For one 

product service code, we selected the second largest award to ensure 

that we reviewed at least one award from the following components: Air 

Force, Army, MDA and Navy. The sample included 4 Air Force awards, 5 

Army awards, 1 MDA award, and 5 Navy awards. See appendix III for 

more details on the selected one-offer awards.

For each selected award, we obtained evidence of the solicitation 

issuance and proposal due date, documentation of cost or price analysis, 

and other key information. We interviewed contracting officials involved 

with each award to understand the competitive environment for each 

award and the reasons why one offer was received. We also e-mailed or 
Appendix I: Objectives, Scope, and 

Methodology

Page 41 GAO-14-395 Defense Contracting

interviewed several vendors who had expressed interest in some of these 

awards but chose not to submit offers. We assessed recent DOD 

implementing regulations to determine whether key reasons for one-offer 

awards were addressed.

We conducted this performance audit from May 2013 to May 2014, in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and

conclusions based on our audit objectives.
Appendix II: Selection of Noncompetitive 

Justification and Approval Documents

Page 42 GAO-14-395 Defense Contracting

Product or service 

category

Description

of product or service

Reason for 

reliance on 

one source

Justification 

included 

required 

elements

Justification 

documented 

approval

Publicly 

available 

within 

required 

timeframe Dollar value

Air Force

Space vehicles Expendable launch 

vehicles

Unique 

technology

Yes Yes Yes $1,015,467,962

Guided missiles Griffin missiles® Lack of data 

rights

Yes Yes Yes $85,500,000

Communication, detection 

and coherent radiation 

equipment

Mobile phones and 

mapping devices

Unique 

technology

No Yes Yes $1,273,577

Army

Aircraft components and 

accessories

Overhaul/ upgrade of 

helicopter main rotor blade

Vendor is the 

only approved 

source

Yes Yes Noa $42,019,356

Ground effect vehicles, 

motor vehicles, trailers 

and cycles

M1A1 situational 

awareness tanks for the 

Iraqi government

Lack of data 

rights

Yes Yes No $9,525,768

Other research and 

development

Experimental vehicle 

mounted explosive 

detectors

Unique 

technology

Yes Yes Not

applicableb $3,199,952

Electrical and electronic 

equipment components

Rebuild kits for diesel 

generator engines

Lack of data 

rights

Yes Yes No $1,700,918

Maintenance, repair and 

rebuilding of equipment

Maintenance of heating, 

ventilation and air 

conditioning systems

Lack of data 

rights

Yes Yes No $780,000

Missile Defense Agency

Professional support Service and maintenance 

of management software

Lack of data 

rights

Yes Yes Noa $3,053,289

Navy

Ships, small craft, 

pontoons, and floating 

docks 

Submarine repair services Unique 

technology

Yes Yes Noa $222,300,000

Defense systems research 

and development

Situational awareness and 

communications software

Lack of data 

rights

No No Yes $7,221,956

Aircraft and airframe 

structural components

Spare helicopter 

windshields 

Lack of data 

rights

Yes Yes Yes $5,948,949

Defense other research 

and development

Integrated air and missile 

defense software 

development

Unique 

Technology

Yes Yes Noa $5,653,615

Appendix II: Selection of Noncompetitive 

Justification and Approval Documents
Appendix II: Selection of Noncompetitive 

Justification and Approval Documents

Page 43 GAO-14-395 Defense Contracting

Product or service 

category

Description

of product or service

Reason for 

reliance on 

one source

Justification 

included 

required 

elements

Justification 

documented 

approval

Publicly 

available 

within 

required 

timeframe Dollar value

Transportation/ 

travel/relocation

Helicopter support services Foreign 

government 

identified 

vendorc

No No No $881,914

Source: GAO analysis of DOD documents.

Note: “Yes” means that we found the document was in accordance with regulation. “No” means that 

we found the document was not in accordance with regulation. “Not applicable” means that the 

regulation did not apply to the document.

a

Justification was made publicly available, but outside the required 14-day time frame.

b

FAR 6.305(f) states that the requirements for public availability do not apply if posting the justification 

would disclose the executive agency’s needs and disclosure of such needs would compromise 

national security or create other security risks.

c

The foreign government declared its aviation sector, including operational control of airports and 

airport systems, a national security asset. Therefore, foreign government officials must authorize all 

operations within the territorial jurisdiction within their country, and conditioned their approval of U.S. 

government operations on contracting with a helicopter company that is owned or substantially 

controlled by its government.
Appendix III: Selected One-Offer Awards

Page 44 GAO-14-395 Defense Contracting

Product or service category Description of product or service

Total

contract value

Days 

solicitation 

initially open

Total days 

solicitation 

open, with 

extensions

Air Force

Defense other research and 

development 

Hardware and software research and 

development $593,000,000 29a 29

Transportation/travel/relocation Space launch services $153,552,050 31 31

Information technology and 

telecommunications 

Air Vehicle Planning System software

$97,580,826 35 35

Other research and development Modeling and simulation engineering 

and technical support $62,988,315 32 34

Army

Professional support Sustainment support services for 

command and control equipment in 

Afghanistan, Iraq and Kuwait $178,090,227 20b 20

Education/training Flight training instruction $164,090,867 32 49

Construction of structures and 

facilities

Dam improvement in Afghanistan

$61,624,314 29c 126

Ammunition and explosives Artillery charge propellant $52,399,750 32 42

Maintenance of structures and 

facilities

Construction industrial support 

services $45,000,000 30 30

Missile Defense Agency

Defense systems research and 

development

Radar system upgrade

$125,343,762 44 44

Navy

Communication, detection, and 

coherent radiation equipment

Tactical portable radios and related 

parts $296,701,117 32 32

Engines, turbines, and components DDG-51 machinery control system 

modernization $134,186,364 31 42

Electrical and electronic equipment 

components

DDG-51 integrated bridge navigation 

systems modernization $88,583,682 30 44

Maintenance, repair, and rebuilding 

of equipment

Submarine electronics and equipment 

support $56,331,300 32 32

Automatic data processing 

equipment, software, supplies and 

support equipment

Web portal support services

$55,803,056 31 31

Source: GAO analysis of DOD documents.

a

The response period was miscalculated and a waiver was granted from the requirement to resolicit.

b

The response period was intentionally short to meet urgent time frames and the award falls under an 

exception to the one-offer requirements for contingency operations.

c

This award falls under an exception to the one-offer requirements for contingency operations.

Appendix III: Selected One-Offer Awards
Appendix IV: Comments from the Department 

of Defense

Page 45 GAO-14-395 Defense Contracting

Appendix IV: Comments from the 

Department of Defense
Appendix IV: Comments from the Department 

of Defense

Page 46 GAO-14-395 Defense Contracting
Appendix V: GAO Contact and Staff 

Acknowledgments

Page 47 GAO-14-395 Defense Contracting

William T. Woods, (202) 512-4841 or woodsw@gao.gov

In addition to the contact named above, Penny Berrier, Assistant Director; 

Alexandra Dew Silva; Lisa Fisher; Laura Greifner, Julia Kennon; Jean 

McSween; Kenneth Patton; Jose Ramos; Roxanna Sun; and Alyssa Weir 

also made key contributions to this report.

Appendix V: GAO Contact and Staff 

Acknowledgments

GAO Contact

Staff 

Acknowledgments

(121145)
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