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OFPP Followup to Federal Supply Schedule Recommendations	 
(31-JAN-03, GAO-03-399R).					 
                                                                 
This report is to bring the Office of Federal Procurement	 
Policy's attention to two GAO recommendations concerning the	 
acquisition of information technology services under the Federal 
Supply Schedule (FSS). In GAO's view, implementation of these	 
recommendations has been delayed because of unnecessary coupling 
with other FSS issues.						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-03-399R					        
    ACCNO:   A06015						        
  TITLE:     OFPP Followup to Federal Supply Schedule Recommendations 
     DATE:   01/31/2003 
  SUBJECT:   Competitive procurement				 
	     Contract administration				 
	     Federal procurement policy 			 
	     Information technology				 
	     Federal Supply Schedule				 

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GAO-03-399R

GAO- 03- 399R OFPP Followup United States General Accounting Office

Washington, DC 20548

January 31, 2003 Ms. Angela B. Styles Administrator Office of Federal
Procurement Policy Washington, D. C.

Subject: OFPP Followup to Federal Supply Schedule Recommendations Dear Ms.
Styles: This report is to bring to your attention two GAO recommendations
concerning the acquisition of information technology services under the
Federal Supply Schedule (FSS). In our view, implementation of these
recommendations has been delayed because of unnecessary coupling with
other FSS issues.

In November 2000, we reported 1 that contracting officers did not follow
FSS ordering procedures requiring them to seek competitive quotes for
services. We found that many contracting officers were unaware of the
requirement. Hence, we recommended, and the Office of Federal Procurement
Policy agreed, that the requirement for competitive quotes should be
included in the Federal Acquisition Regulation (FAR). We also recommended
clarification of the FAR pertaining to sole source orders for services
using the FSS. Although a FAR case has been opened, little progress has
been made in implementing the recommendations. Moreover, the latest
informal estimate indicates that a final rule will not be published until
April 2004.

We are concerned about the delay because sales of services under the FSS
continue to substantially increase. Moreover, recent federal audits
suggest that the problems still exist. For example, in March 2002, the
Office of Inspector General, National Aeronautics and Space
Administration, found that contracting officers did not follow the
ordering procedures for services in 8 of 20 reviewed contracts with regard
to obtaining multiple quotes or providing sufficient information in the
request for quotation or statement of work. 2 1 U. S. General Accounting
Office, Contract Management: Not Following Procedures Undermines Best

Pricing Under GSA*s Schedule, GAO- 01- 125 (Washington, D. C.: Nov. 28,
2000). 2 Office of Inspector General, National Aeronautics and Space
Administration, NASA Acquisition of

Services Using the Federal Supply Schedules, Report Number IG- 02- 014
(Washington, D. C.: Mar. 27, 2002).

GAO- 03- 399R OFPP Followup Page 2 Also, in November 2002, the Department
of Defense, Office of Inspector General,

reported that in 36 of 44 orders for services contracting officials could
not show that they followed FAR procedures for the Federal Supply Schedule
or that they had requested quotes from multiple contractors as required by
the Government Services Administration ordering procedures. 3 Although the
competitive quotes issue has been addressed in part by recent changes to
the Defense FAR Supplement, a FAR revision is necessary for a
comprehensive implementation of the recommendation.

We understand that the delay in implementation is the result of efforts to
address matters other than the need to obtain competitive quotes. For
example, one issue has been whether the use of time- and- materials
contracts should be allowed under the Federal Supply Schedule.

We believe the guidance concerning competitive quotes and sole source
awards for services should be incorporated into the FAR before resolving
other issues. More importantly, we believe that this would provide a
foundation for immediate improvements in the use of FSS contracts.

We are also sending copies of this report to officials at the General
Services Administration. The report will be available at no charge on the
GAO Web site, www. gao. gov. If you have any questions about this report,
please contact me at (202) 512- 4841 or Ralph Dawn at (202) 512- 4544.

Sincerely yours, David E. Cooper Director Acquisition and Sourcing
Management

(120201) 3 Office of Inspector General, U. S. Department of Defense,
Acquisition: Contract Actions Awarded to Small Businesses, Report Number
D- 2003- 029 (Washington, D. C.: November 25, 2002).
*** End of document. ***
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