DEFENSE 

CONTRACTING

Competition for 

Services and Recent 

Initiatives to Increase 

Competitive 

Procurements

Report to Congressional Committees

March 2012

GAO-12-384

United States Government Accountability Office

GAO
United States Government Accountability Office

Highlights of GAO-12-384, a report to 

congressional committees 

March 2012 

DEFENSE CONTRACTING

Competition for Services and Recent Initiatives to 

Increase Competitive Procurements 

Why GAO Did This Study

Competition is a critical tool for 

achieving the best return on 

investment for taxpayers. In fiscal year 

2011, the Department of Defense 

(DOD) obligated about $375 billion 

through contracts; more than half that 

amount was for services. Agencies are 

required to award contracts on the 

basis of full and open competition, but 

are permitted to award noncompetitive 

contracts in certain situations.

The Senate Armed Services 

Committee report on the National 

Defense Authorization Act for Fiscal 

Year 2012 directed GAO to report on 

competition for DOD contracts and 

task orders for services. GAO

examined (1) how competition rates for 

services compare to competition rates 

for products and trends in competition 

for services, (2) the reasons for 

noncompetitive contracts and task 

orders for services, and (3) steps DOD 

has taken to increase competition.

GAO reviewed federal procurement 

data for 2007 through 2011 and a nongeneralizable sample of 111

justifications for noncompetitive 

awards, which were from different 

DOD components and for different 

types of services. GAO defines 

competition rates as the dollars 

obligated under competitive contracts 

and task orders as a percentage of all 

obligations. GAO focused on nonresearch and development (R&D)

services to concentrate analysis on 

contracts not related to development of 

weapons systems. GAO reviewed 

DOD policies and competition reports, 

and prior GAO reports.

GAO is not making any new 

recommendations. DOD responded to 

a draft of this report with no comments.

What GAO Found

In fiscal year 2011, the competition rate for DOD’s non-R&D services was almost 

twice the competition rate as that of products, and almost 20 percent higher than 

that of R&D services, as shown below. 

DOD Competition Rates for All Fiscal Year 2011 Obligations 

From fiscal year 2007 through 2011, competition rates for non-R&D services 

have been nearly 80 percent and have not changed significantly across DOD, but

have declined at the Air Force, dropping from 75 percent to 59 percent. 

According to a DOD procurement policy official, the Air Force competition 

advocate is assessing the reasons for lower competition rates. When non-DOD 

agencies procured non-R&D services on behalf of DOD in fiscal year 2011, their 

average competition rate was 81 percent, slightly higher than the average rate of 

78 percent for DOD’s own contracting offices. 

The majority of DOD noncompetitive obligations for non-R&D services in fiscal 

year 2011 were due to the contractor being the only responsible source for the 

procurement. The second most cited exception was “authorized by statute,” for 

example, awards under the Small Business Administration’s 8(a) business 

development program. Based on prior GAO work, a variety of factors can affect 

competition, including reliance on contractor expertise and data rights, the 

influence of program offices, and unanticipated events such as bid protests. GAO

analysis of the justifications for noncompetitive contracts identified examples of 

these factors affecting competition for DOD procurements in fiscal year 2011. 

Since 2009, the Office of Management and Budget (OMB) and DOD have 

undertaken initiatives related to competition, including actions to address some 

opportunities GAO previously identified. DOD has taken steps aimed at 

increasing competition, in particular “effective competition” which DOD defines as 

situations where more than one offer is received in response to a competitive 

solicitation. For instance, DOD has implemented requirements to provide 

additional response time to solicitations when only one offer is received for a 

solicitation that initially provided less than 30 days for receipt of proposals. 

Outside of recent efforts to increase competition, OMB and DOD have additional 

opportunities to address prior GAO recommendations—such as promoting the 

role of program officials in influencing competition and better understanding the 

circumstances leading to only one offer on competitive contracts. 

View GAO-12-384. For more information, 

contact John Hutton at (202) 512-4841 or 

huttonj@gao.gov
Page i GAO-12-384 Defense Competition for Services 

Letter 1 

Background 4

Competition Rates for Non-R&D Services Substantially Higher 

Than for Products with Little Change over Time 8

Majority of Noncompetitive Awards Coded as “Only One 

Responsible Source” and Competition Rates Were Affected by 

Several Key Factors 12

OMB and DOD Are Taking Steps to Increase Competition 19

Agency Comments 23

Appendix I Objectives, Scope, and Methodology 25

Appendix II Fiscal Year 2011 DOD Competition Rates by Service Category and 

Component 28

Appendix III GAO Contact and Staff Acknowledgments 30

Table

Table 1: DOD Competition Rates for Non-R&D Service Categories 

in Fiscal Year 2011 28

Figures

Figure 1: DOD Competition Rates for All Fiscal Year 2011 

Obligations 8

Figure 2: Competition Rates for All Obligations for Non-R&D 

Services from Fiscal Years 2007 through 2011 9

Figure 3: Fiscal Year 2011 Competition Rates for Top 10 Assisting 

Agencies 11

Figure 4: Competition Exceptions for Fiscal Year 2011 DOD 

Obligations on Noncompetitive Non-R&D Service 

Contracts and Task Orders 13

Figure 5: Competition Rates by DOD Component for Non-R&D 

services in Fiscal Year 2011 29

Contents
Page ii GAO-12-384 Defense Competition for Services 

Abbreviations 

CICA Competition in Contracting Act

DOD Department of Defense

FAR Federal Acquisition Regulation

FASA Federal Acquisition Streamlining Act

FPDS-NG Federal Procurement Data System-Next Generation

GSA General Services Administration

IDIQ indefinite delivery / indefinite quantity

J&A justification and approval

OMB Office of Management and Budget

R&D research and development

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Page 1 GAO-12-384 Defense Competition for Services 

United States Government Accountability Office 

Washington, DC 20548

March 15, 2012

The Honorable Carl Levin

Chairman

The Honorable John McCain

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

Competition is a cornerstone of the federal acquisition system and a 

critical tool for achieving the best possible return on investment for 

taxpayers. Competitive contracts can help save money, conserve scarce 

resources, improve contractor performance, curb fraud, and promote 

accountability. In fiscal year 2011, the Department of Defense (DOD) 

obligated about $375 billion through contracts; more than half of that 

amount was for services. In recognizing the need to make more efficient 

use of resources, DOD’s 2010 “Better Buying Power” initiative placed an 

emphasis on maximizing opportunities for competition in the acquisition of 

products and services.

While the Competition in Contracting Act (CICA) of 1984 generally 

requires federal agencies to award contracts using full and open 

competition, agencies are allowed to award contracts noncompetitively 

under certain circumstances. Generally, noncompetitive contracts must 

be supported by written justifications and approvals (J&A) that address 

the specific exception to full and open competition that is being applied to 

the procurement. In addition, federal agencies can establish indefinite 

delivery/indefinite quantity (IDIQ) contracts with one or more contractors 

and issue orders under these contracts. When more than one contractor 

is involved, agencies are generally required to provide all contractors a 

fair opportunity to be considered for each order above certain dollar 

thresholds; however, agencies can award noncompetitive orders under a 

process called an exception to the fair opportunity process—again with a 

documented justification. For purposes of this report, we consider use of 

the fair opportunity process to be competition. Finally, the General 

 
 

Page 2 GAO-12-384 Defense Competition for Services 

Services Administration (GSA), under its schedules program, awards 

IDIQ contracts to multiple vendors for commercially available goods and 

services, and federal agencies place orders under the contracts. When 

doing so noncompetitively, procuring agencies must justify the need to 

restrict the number of vendors considered, known as a limited sources 

justification and approval.

The Senate Armed Services Committee report on the National Defense 

Authorization Act for Fiscal Year 2012 expressed concerns that DOD may 

not be competing service contracts as much as it could. The Senate 

committee report directed us to report on competition for DOD contracts 

and task orders for services.1

To address these objectives, we identified through the Federal 

Procurement Data System-Next Generation (FPDS-NG) DOD obligations 

under competitive and noncompetitive contracts in fiscal years 2007 

through 2011, the most recent data available at the time of our review.

Accordingly, we examined (1) how 

competition rates for services compare to competition rates for products, 

and trends in competition for services; (2) the reasons for noncompetitive 

contracts and task orders for services; and (3) steps DOD has taken to 

increase competition for services.

2

 

1 Task orders for services (and delivery orders for supplies) are issued under IDIQ 

contracts. IDIQ contracts do not procure or specify a firm quantity of supplies or services 

(other than a minimum or maximum) and provide for the issuance of orders during the 

contract period. FAR § 16.501-1.

We identified obligations to noncompetitive contracts primarily through the 

“extent competed” and “fair opportunity/limited sources” fields in FPDSNG. These fields include contracts coded as not competed or not 

available for competition, and noncompetitive task or delivery orders. As a 

result, and 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 in Federal Acquisition 

Regulation (FAR) Subpart 6.3, and orders issued under multiple award 

IDIQ contracts under the exceptions to the fair opportunity process in 

2 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, and (2) 

reviewing existing information about the data and the system that produced them. We 

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

Page 3 GAO-12-384 Defense Competition for Services 

FAR 16.505(b) or under limited sources provisions for orders issued 

under GSA’s schedules program in FAR Subpart 8.405-6.3

We calculated competition rates as the percentage of dollars obligated 

annually through competitive contracts and orders to dollars obligated 

through all contracts and orders. While we focused our analysis of FPDSNG on non-research and development (R&D) services to concentrate our 

analysis on contracts not related to development of weapons systems, we 

assessed fiscal year 2011 competition rates for R&D services and 

compared them to competition rates for non-R&D services and for 

products. We also identified trends in competition rates for non-R&D 

services at DOD and its components from fiscal year 2007 through 2011. 

For the purposes of this report, we divided DOD into four components: Air 

Force, Army, Navy, and other defense agencies.4

To gain an understanding of the reasons leading to noncompetitive 

awards, we reviewed a non-generalizable selection of 111 DOD J&A 

documents and exception to fair opportunity documents. We selected 

these documents to reflect the non-R&D service categories with the 

We also examined 

competition rates for the non-DOD organizations that obligated funds for 

services on DOD’s behalf through the use of interagency contracting in 

fiscal year 2011. Interagency contracting allows an agency needing 

contracting services (the requesting agency) to obtain them from another 

agency (the assisting agency) by an assisted or a direct acquisition and, 

when used correctly, can offer improved efficiency in the procurement 

process. All competition rate information was based on our analysis of 

FPDS-NG data. We present the trend data in this report, but did not 

determine the reasons for any fluctuations in trends over time. We did not 

assess competition rates for contracts related to specific circumstances, 

such as contracts in support of contingency operations.

 

3 For task orders subject to fair opportunity, generally the contracting officer must provide 

each contractor a fair opportunity to be considered for each order under multiple-award 

IDIQ contracts, 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.

4 Other defense agencies data include obligations made by any DOD contracting office 

that is not part of the Air Force, Army, or Navy. These include, but are not limited to: 

Defense Logistics Agency, Defense Supply Center, Defense Contract Management 

Agency, Defense Information Technology Contracting Organization, Missile Defense 

Agency, TRICARE Management Activity, and Defense Threat Reduction Agency. 
 

Page 4 GAO-12-384 Defense Competition for Services 

highest DOD obligations as well as the J&As requiring the highest level of 

review within the department. We selected justifications that were posted 

to the FedBizOpps.gov website in fiscal year 2011 and also reviewed 

J&As provided by DOD components in response to our request for all 

J&As approved by senior procurement executives in fiscal year 2011.5

To identify steps DOD has taken to increase competition, we reviewed 

recently issued GAO reports and previous interviews with DOD 

acquisition officials including component competition advocates. We also 

reviewed Office of Management and Budget (OMB) and DOD policies 

and guidance related to competition, and DOD competition reports for 

fiscal years 2009 and 2010.

Some of these documents were for a mix of products and services 

providing weapons system support. We did not evaluate the J&As for 

completeness or reasonableness or validate how they were coded in 

FPDS-NG.

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

appendix I. Appendix II contains additional information on competition 

rates for various categories of services and by DOD component. We 

conducted this performance audit from September 2011 to March 2012, 

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.

Federal agencies are generally required to use full and open competition 

to award contracts, with certain exceptions. This requirement was 

established through CICA, which required agencies to obtain full and 

open competition through the use of competitive procedures in their 

procurement activities unless otherwise authorized by law. 6

 

5 The FAR generally requires contracting officers to post justifications for noncompetitive 

procurements at FedBizOpps.gov. FAR §§ 6.305 and 16.505(b)(2). This site may be 

accessed via the Internet at https://www.fbo.gov/. The FAR requires justifications to be 

approved by DOD senior procurement executives when the total value of the acquisition is 

expected to exceed $85.5 million.

Using full 

6 Pub. L. No. 98-369, § 2701.

Background
 

Page 5 GAO-12-384 Defense Competition for Services 

and open competition to award contracts means that all responsible 

sources—or prospective contractors that meet certain criteria—are 

permitted to submit proposals. Agencies are generally required to perform 

acquisition planning and conduct market research to promote and provide 

for, among other things, full and open competition. However, Congress, 

by enacting CICA, also recognized that there are situations that require or 

allow for contracts to be awarded noncompetitively—that is, without full 

and open competition.7 Generally, noncompetitive contracts must be 

supported by written J&As that contain sufficient facts and rationale to 

justify the use of the specific exception to full and open competition that is 

being applied to the procurement. Examples of allowable exceptions 

include circumstances where the contractor is the only source capable of 

performing the requirement or where an urgent need precludes adequate 

time for competition. Justifications generally are required to be published 

on the FedBizOpps.gov website and must be approved at levels that vary 

according to the dollar value of the procurement. J&As may be made for 

an individual procurement or on a class basis for a group of related 

acquisitions.8

Although full and open competition is generally required, 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 set aside procurements for small 

businesses. In these cases, agencies are required to set aside 

procurements for competition among qualified small businesses if there is 

Noncompetitive contracts are not permitted in situations in 

which the requiring agency has failed to adequately plan for the 

procurement or in which there are concerns related to availability of 

funding for the agency, such as funds expiring at the end of the year.

 

7 FAR Subpart 6.3 sets forth the circumstances in which a contract is allowed to be 

awarded without providing for full and open competition.

8 Whenever a justification is made and approved on a class basis, the contracting officer 

must ensure that each contract action taken under the class J&A’s authority is within the 

class J&A’s scope and document the contract file for each contract action accordingly. 

The approval level for class justifications is determined by the estimated total value of the 

class. FAR § 6.304(c).
 

Page 6 GAO-12-384 Defense Competition for Services 

a reasonable expectation that two or more responsible small businesses 

will compete for the work and offer fair market prices.9

When agencies issue task orders under IDIQ contracts, they are required 

to follow different procedures than those for full and open competition. As 

established under the Federal Acquisition Streamlining Act (FASA) of 

1994, IDIQ contracts can be single award (to one contractor) or multiple 

award (to more than one contractor through one solicitation), but FASA 

establishes a preference for multiple award contracts. Agencies are 

generally required to compete orders on multiple award contracts among 

all contract holders. However, agencies can award noncompetitive 

orders—through a process called an exception to a fair opportunity to be 

considered—for reasons similar to those used for awarding contracts 

without full and open competition, such as only one contractor being 

capable of providing the supplies or services needed, or for an urgent 

requirement.10 As with noncompetitive contracts, the reasons for issuing 

task orders under multiple award IDIQ contracts under an exception to 

the fair opportunity process must generally be documented in writing and 

approved at levels that vary according to the dollar value of the 

procurement.11

GSA, under its schedules program, awards IDIQ contracts to multiple 

vendors for commercially available goods and services, and federal 

agencies place orders under the contracts. Ordering procedures under 

the schedules program vary according to the dollar value of the 

procurement. For example, to meet competition requirements for orders 

exceeding the micro-purchase threshold ($3,000) but not exceeding the 

 

9 See FAR § 19.502-2 (b), which requires that acquisitions over $150,000 be set aside for 

small businesses if there is a reasonable expectation that offers will be obtained from at 

least two responsible small business concerns offering the products of different small 

business concerns and that the award will be made at a fair market price. 

10 See FAR § 16.505(b)(2). Other reasons for allowing a noncompetitive task order are 

that the requirement is a logical follow-on, or the order is needed to meet a minimum 

guarantee.

11 FAR §§ 16.505 (b)(2)(ii)(A)(B)(C). The FAR was revised in March 2011 to enhance 

competition for orders placed under multiple-award contracts, including GSA’s schedules 

contracts, and to implement section 863 of the Duncan Hunter National Defense 

Authorization Act for Fiscal Year 2009. Pub. L. No. 110-417. 76 Fed. Reg. 14542, 

Summary Presentation of final and interim rules, March 16, 2011.

Competitive Requirements 

for Indefinite Delivery / 

Indefinite Quantity 

Contracts
 

Page 7 GAO-12-384 Defense Competition for Services 

simplified acquisition threshold ($150,000), agencies must survey or 

request quotes from at least three schedule contractors.12 However, to 

meet competition requirements for proposed orders exceeding the 

simplified acquisition threshold, agencies must post a request for 

quotation on GSA’s posting website or provide it to as many schedule 

contractors as practicable to reasonably ensure that agencies receive at 

least three quotes from contractors that can fulfill the requirement. 

Agencies must document in the file if fewer than three quotes are 

received from contractors capable of fulfilling the requirement.13 For 

orders issued noncompetitively under the schedules program, the 

ordering agency must justify in writing—with specific content required by 

the FAR—the need to restrict competition and also obtain approval at the 

same dollar values and by the same officials as for contracts awarded 

without full and open competition.14

Contracts that are awarded using competitive procedures but for which 

only one offer is received have recently gained attention as an area of 

concern.15

 

12 FAR § 8.405-1(c)(1). 

OMB’s Office of Federal Procurement Policy recently 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. Under DOD’s Better Buying Power 

policy, competitive procurements where only one offer to a solicitation 

was received even when publicized under full and open competition are 

termed as “ineffective competition.” The Navy has identified the potential 

for cost savings when effective competition is achieved. Specifically, in 

2010, the Navy conducted a commodity study on the acquisition of 

information technology services that identified cost savings when more 

than one offer was received. Currently, FPDS-NG distinguishes these 

contracts by recording how many offers were received on any 

procurement.

13 FAR § 8.405-1(d). 

14 FAR § 8.405-6, Limiting sources.

15 We have reported on this issue, as well as on competition in general. GAO, 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).

Competitive Procurements 

Where Only One Offer Is 

Received
 

Page 8 GAO-12-384 Defense Competition for Services 

In fiscal year 2011, the competition rate for dollars obligated across DOD 

on contracts and task orders for non-R&D services was substantially 

higher than the competition rate for products—78 percent compared to 

41 percent.16

Figure 1: DOD Competition Rates for All Fiscal Year 2011 Obligations

R&D services had a competition rate of 59 percent. (See 

figure 1.) DOD’s overall competition rate for all services and products was 

58 percent. According to a DOD procurement policy official, non-R&D 

services may be more commercial in nature than products, so there are 

more providers available to compete for these contracts. In contrast, the 

official said that opportunities for competition for R&D services are limited 

because they are generally provided by a limited number of vendors, 

such as university research laboratories, which each have their own area 

of specialized expertise.

 

16 For the purposes of this report, we calculated DOD competition rates as the percentage 

of dollars obligated annually through competitive contracts and task orders to dollars 

obligated through all contracts and task orders, including those awarded in prior years. 

This overall competition rate includes all contracts and task orders where competitive 

procedures were used regardless of the number of offers received. We provide additional 

comparisons of competition rates for different types of non-R&D services and major DOD 

components in appendix II.

Competition Rates for 

Non-R&D Services 

Substantially Higher 

Than for Products 

with Little Change 

over Time
 

Page 9 GAO-12-384 Defense Competition for Services 

From fiscal years 2007 through 2011, the rate at which non-R&D services 

were competed did not change significantly across DOD, the Army, or the 

Navy. Across DOD, competition rates went from 79 percent in 2007 to 

78 percent in 2011. Among the major components, the Air Force had a 

significant decline, dropping from 75 percent to 59 percent. According to a 

DOD procurement policy official, the Air Force competition advocate is 

assessing the reasons for lower competition rates. Other defense 

agencies had a small increase in competition rates, from 85 percent to 

89 percent. (See figure 2.)

Figure 2: Competition Rates for All Obligations for Non-R&D Services from Fiscal Years 2007 through 2011
 

Page 10 GAO-12-384 Defense Competition for Services 

Competition rates for obligations on only new contracts and orders for 

non-R&D services across DOD over the same 5-year period exhibited the 

same general trend as for obligations on all non-R&D services contracts 

and orders, with two main exceptions. The competition rate for new 

actions at the Navy declined, from 76 percent to 71 percent, and the 

competition rate at other defense agencies increased significantly, from 

78 percent to 91 percent. In fiscal year 2011, almost half of obligations for 

non-R&D services were made on new contracts and task orders awarded 

in that year. The remaining obligations were under contracts and task 

orders that had been awarded in prior years.

We also examined competition rates for non-DOD agencies providing

assisted acquisition services to DOD. These agencies are commonly 

referred to as assisting agencies. For example, in fiscal year 2011, 

Department of the Interior (Interior) and GSA contracting offices, among 

other agencies, obligated a total of $3.8 billion in DOD funds for non-R&D 

services. While the assisting agencies had varying competition rates, their 

average competition rate was slightly higher than that of DOD’s 

contracting offices—81 percent compared to 78 percent. However, one 

non-DOD contracting office within Interior, which was among the assisting 

agencies with the highest DOD obligations, had a substantially lower 

competition rate for non-R&D services—51 percent. (See figure 3.) A 

DOD procurement policy official stated that the competition advocates do 

not currently track competition rates by assisting agencies as part of their 

overall competition assessments.
 

Page 11 GAO-12-384 Defense Competition for Services 

Figure 3: Fiscal Year 2011 Competition Rates for Top 10 Assisting Agencies
 

Page 12 GAO-12-384 Defense Competition for Services 

Based on our analysis of FPDS-NG data, in fiscal year 2011 the majority 

of DOD’s noncompetitive non-R&D services contracts and task orders 

were coded under the “only one responsible source” category. In addition, 

based on our prior work, a variety of factors can affect competition, 

including reliance on contractor expertise and data rights, the influence of 

program offices on the acquisition process, and unanticipated events 

such as bid protests.

In fiscal year 2011, the majority of DOD’s non-R&D services obligations 

under noncompetitive contracts and task orders not coded as subject to 

fair opportunity were coded under the competition exception “only one 

responsible source” in FPDS-NG.17 The second most cited exception was 

“authorized by statute.” Together, these two exceptions comprised more 

than 80 percent of all obligations on noncompetitive contract actions.18

 

17 Not all task 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 2011 DOD 

noncompeted non-R&D services obligations on task orders were not coded as subject to 

fair opportunity in FPDS-NG.

See figure 4 for obligations across competition exceptions for 

noncompetitive non-R&D services contracts and task orders not subject 

to fair opportunity.

18 We have previously reported about miscoding errors related to this FPDS-NG field. See 

GAO-10-833. However, these two categories are so prominent above all others we have 

determined that the data are sufficiently reliable for the purpose of this analysis. Appendix 

I contains more detail. 

Majority of 

Noncompetitive 

Awards Coded as 

“Only One 

Responsible Source” 

and Competition 

Rates Were Affected 

by Several Key 

Factors 

Majority of DOD Non-R&D 

Services Noncompetitive 

Obligations Were Coded 

under “Only One 

Responsible Source” 
 

Page 13 GAO-12-384 Defense Competition for Services 

Figure 4: Competition Exceptions for Fiscal Year 2011 DOD Obligations on 

Noncompetitive Non-R&D Service Contracts and Task Orders

Note: These noncompetitive obligations do not include instances where competitive procedures were 

used but only one offer was received. 

a

“Only one responsible source” includes contracts and orders placed on 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

FAR § 6.302-5. 

c

FAR § 6.302-6. 

d

“All others” includes contracts and orders placed on IDIQ contracts that cited the following 

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

capability, or expert services; international agreement; public interest, FAR §§ 6.302-2 through 6.302-

4, and 6.302-7; and not competed using simplified acquisition procedures under FAR § 13.3. 

Major weapon systems programs have cited the “only one responsible 

source” exception to justify not competing large contract actions in class 

J&As. Under a class J&A, one justification supports not competing 

consolidated product and service requirements across DOD activities and 
 

Page 14 GAO-12-384 Defense Competition for Services 

multiple programs. In our review of J&As, we identified several examples 

where DOD cited the “only one responsible source” exception, 

including:19

• The Air Force justified a $200.7 million noncompetitive contract under 

a class J&A to a subcontractor of one of its long-standing incumbent 

contractors for communication equipment and support services for an 

aircraft system. Market research indicated that the subcontractor was 

the only source of the equipment and services, and by eliminating 

pass-through costs associated with subcontracting the Air Force could 

save up to $66 million or 33 percent of the estimated contract value.

• The Army justified extending an $8.3 million task order 

noncompetitively for training and support services for soldiers going 

into and returning from overseas deployment following a decision to 

change the location where the services would be required under a 

planned follow-on competitive procurement. The J&A noted that 

planning for the follow-on contract had started in December 2009, but 

in late October 2010 the contracting office learned that all required 

support services would be fully transferred to other Army locations by 

December 2011. According to the J&A, officials noted that it would not 

be advantageous to pursue full and open competition for a 1-year 

service contract.

Noncompetitive obligations categorized as “authorized by statute” include 

contracts that are authorized or required to be made through another 

agency or from a specified source, including awards under the HUBZone 

Act of 1997, the Veterans Benefit Act of 2003, and the Small Business 

Administration’s 8(a) business development program.20

 

19 In each of the “only one responsible source” examples, J&As cited FAR § 6.302-1.

For example, the 

Defense Commissary Agency cited this exception for a noncompetitive 

contract for emergency repairs valued at $308,759 to a service disabled 

veteran-owned small business. The agency urgently needed to upgrade 

its computer room air conditioning and noted that the contractor had 

performed similar work in the past with excellent results.

20 FAR § 6.302-5. The HUBzone program, administered by the Small Business 

Administration, is meant to spur economic growth in historically underutilized business 

zones by helping qualified small businesses secure federal contracts. In addition, we 

recently reported on tribal 8(a) contracting, including noncompetitive contracts awarded to 

Alaska Native Corporations, Indian tribes, and Native Hawaiian Organizations. GAO, 

Federal Contracting: Monitoring and Oversight of Tribal 8(a) Firms Need Attention,

GAO-12-84 (Washington, D.C.: Jan. 31, 2012).
 

Page 15 GAO-12-384 Defense Competition for Services 

In addition, 5 percent of noncompetitive obligations on contracts and task 

orders not subject to fair opportunity were categorized under the “national 

security” exception, which is used when the disclosure of the agency’s 

needs would compromise national security. This exception, however, is 

not to be used merely because the acquisition is classified or because 

access to classified matter is necessary.21

Task orders issued under multiple award contracts and coded as subject 

to the fair opportunity process represented only 12 percent of 

noncompetitive non-R&D services obligations in fiscal year 2011.22 Of the 

over $4 billion obligated under noncompetitive non-R&D task orders that 

were subject to the fair opportunity process, over 80 percent were coded 

under two exceptions to the fair opportunity process in FPDS-NG. 

Specifically, “follow-on action following competitive initial action” was cited 

for 46 percent of the obligations and “only one source” was cited for 

36 percent. Agencies can noncompetitively award a logical follow-on to 

an order already issued under an IDIQ contract if all awardees were given 

a fair opportunity to be considered for the original order. 23

In July 2010, we identified key factors affecting competition, including 

reliance on contractor expertise and proprietary data. Also, program 

officials can influence competition by expressing vendor preferences, 

planning acquisitions poorly, or specifying overly restrictive 

requirements.24

 

21 We recently reported on the use of the national security exception to competition. See 

GAO, Defense Contracting: Improved Policies and Tools Could Help Increase Competition 

on DOD’s National Security Exception Procurements, 

Unanticipated events such as bid protests or unforeseen 

requirements with time frames that preclude competition can also impact 

competition.

GAO-12-263 (Washington, D.C.: 

Jan. 13, 2012).

22 FAR § 16.505(b).

23 FAR § 16.505(b)(2)(i)(C). According to Defense Federal Acquisition Regulation 

Supplement (DFARS) Procedures, Guidance, and Information 216.505-70, a follow-on 

order is a new procurement placed with a particular contractor to continue or augment a 

specific program or service.

24 GAO-10-833. 

Several Key Factors 

Influence Competition for 

Service Contracts
 

Page 16 GAO-12-384 Defense Competition for Services 

We have previously reported that DOD needs access to technical data 

related to its weapon systems in order to help control costs and maintain 

flexibility in the acquisition and sustainment of those weapon systems. 

Technical data can enable the government to complete maintenance 

work in-house, as well as to competitively award acquisition and 

sustainment contracts. For contracts pertaining to DOD weapons 

programs, which can involve products as well as support services, the 

lack of access to proprietary technical data and a heavy reliance on 

specific contractors for expertise limit, or even preclude the possibility of, 

competition.25

In our review of selected fiscal year 2011 J&As, we identified many 

instances where DOD lacked either the expertise or the technical data 

necessary to conduct a full and open competition. Two examples, which 

were justified under the “only one responsible source” competition 

exception, are:

Even when technical data are not an issue, the government 

may have little choice other than to rely on the contractors that were the 

original equipment manufacturers, and that, in some cases, designed and 

developed the weapon system.

• The Navy approved a class J&A for noncompetitive contract actions 

valued at $2.3 billion to acquire the next generation of aircraft along 

with supporting supplies and services. Officials noted that the 

contractor had been the sole designer, developer, and manufacturer 

of the system since 1964 and would not sell the government the 

technical data required to compete the acquisition.

• The Army justified a noncompetitive $455.3 million contract to 

remanufacture helicopters because the Army lacked the technical 

data and expertise necessary to compete the requirement. According 

to the J&A, although a related contract from the late 1980s allowed 

the government to have technical data packages suitable for 

competition, the data was never obtained. According to the J&A, the 

contractor’s estimated cost for this data was nearly $4 billion. In 

approving the J&A, the senior procurement official noted, “I hope that 

all contracting activities can persistently monitor how to be more 

 

25 Technical data is recorded information used to define a design and to produce, support, 

maintain, or operate a system. GAO, Defense Acquisition: DOD Should Clarify 

Requirements for Assessing and Documenting Technical-Data Needs, GAO-11-469

(Washington, D.C.: May 11, 2011).

Reliance on Contractor 

Expertise and Proprietary Data 

Can Affect Competition
 

Page 17 GAO-12-384 Defense Competition for Services 

competitive, despite the noncompetitive positions we have gotten 

ourselves into over the years.” 

In 2010, we reported that program officials play a significant role in the 

contracting process, particularly in developing requirements and 

interfacing with contractors. Program officials may put pressure on the 

contracting process to award contracts to a specific vendor without 

competition. Contracting officials have said that a program office may be 

comfortable with the incumbent contractor because a relationship had 

developed between the program office and the contractor, who 

understands the program requirements. Program officials pressure the 

contracting office to remain with that contractor, thus inhibiting 

competition. In one J&A we reviewed, the Office of Military Commissions 

expressed a strong preference for the incumbent contractor. Specifically, 

the office justified noncompetitively awarding a contract extension valued 

at up to $15 million for courtroom services at Guantanamo Bay, under the 

competition exception for expert services.26

In 2010, we also reported that, according to contracting officials, program 

officials are often insufficiently aware of the amount of time needed to 

complete acquisition planning, including performing market research, 

properly defining requirements, and allowing contractors time to respond 

to requests for proposals, which may hinder opportunities to increase 

competition. In 2011, we reported that program officials at civilian 

agencies may not know how long these key steps can take, and we have 

recommended that agencies establish time frames for when program 

officials should begin acquisition planning.

According to the J&A, since 

2007, the contractor representatives had become fully integrated 

members of the litigation teams. These services included handling and 

securing sensitive documents and protecting sensitive information in the 

courtroom. Given that the government did not expect to need these 

services for longer than a year, the government did not want to risk 

delays and inefficiencies in the trial process by bringing on a new 

contractor.

27

 

26 This J&A cited FAR § 6.302-3.

Similarly, in one DOD J&A 

we reviewed, the Army justified awarding an $11.2 million noncompetitive 

bridge contract for mission support services at Ft. Bliss, Texas under the 

“only one responsible source” competition exception. Bridge contracts are 

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

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

Program Offices Can Influence 

Competition through Vendor 

Preference, Poor Acquisition 

Planning, or Overly Restrictive 

Requirements 
 

Page 18 GAO-12-384 Defense Competition for Services 

typically short-term to avoid a lapse in service while the award of a followon contract is being planned or an awarded contract is being 

implemented. According to the J&A, this bridge contract was necessary 

after unexpected delays in the acquisition planning process for a planned 

competitive follow-on task order. The delays were due to, among other 

things, the program office changing managers multiple times and 

difficulties writing requirements that met the contracting officer’s 

standards, conflicting end-of-year responsibilities for contracting office 

staff, and the senior procurement officials taking 6 months to approve the 

acquisition strategy.

We have also previously reported that the government’s requirements 

can influence the number of offers received under competitive 

solicitations if these requirements are written too restrictively. Contracting 

officials explained that it is challenging to identify program office 

requirements that are written so restrictively that they are geared toward 

the incumbent. These officials said that their technical backgrounds and 

having the assistance of technical staff in evaluating the requirements can 

help them determine whether the requirements can be broadened. They 

noted that if they lack technical expertise in the specific area, it is more 

difficult to question whether a statement of work is written too restrictively.

Finally, we identified instances when unanticipated events stalled planned 

competition, leading to bridge contracts. Unforeseen events that can lead 

to bridge contracts include unexpected expansion of requirements and 

competitors filing bid protests of competitive follow-on contract awards. Of 

111 J&As we reviewed, 18 were bridge contracts valued at a total of over 

$9 billion. Five of these bridge contracts were due to bid protests. 

Examples of bridge contracts due to unanticipated events include:

• DOD’s TRICARE program justified negotiating noncompetitive options 

that extended the performance on each of the two existing TRICARE 

contracts for 1 year valued at $6.6 billion under the “only one 

responsible source” competition exception to provide managed care 

support services.28

 

28 TRICARE is the health care program serving active duty service members, National 

Guard and Reserve members, retirees, their families, survivors, and certain former 

spouses worldwide.

According to the J&A, these options were 

necessary after unexpected delays in the acquisition process were 

triggered by protests at the agency level and to GAO of the prior 

Unanticipated Events Have 

Resulted in Noncompetitively 

Awarded Contracts
 

Page 19 GAO-12-384 Defense Competition for Services 

competitive awards for these services. The extensions allowed 

TRICARE to compete a large follow-on contract while implementing 

recommendations stemming from the sustained GAO protest without 

disrupting the delivery of health care services to TRICARE 

beneficiaries.

• The U.S. Army Corps of Engineers justified a $22 million 

noncompetitive modification of an existing contract under the “only 

one responsible source” competition exception after learning of a 

major construction requirement in Afghanistan with little notice. As a 

result, current plans for prison construction already under way were 

unexpectedly expanded and had to be completed within a short time 

frame. According to the J&A, the only way to meet this time frame was 

to not compete a new contract. Officials noted that using the existing 

contract could save 30 days or more “off an almost unachievable 

schedule, making every single day saved absolutely critical.” 

Since 2009, OMB and DOD have implemented efficiency initiatives 

related to competition—including actions to address some opportunities 

we previously identified. In July 2010, we reported that recent 

congressional actions to strengthen competition opportunities in major 

defense programs may take some time to demonstrate results. 

Additionally, we reported that OMB’s efforts to reduce agencies’ use of 

high-risk contract types may help agencies refocus and reenergize efforts 

to improve competition. Despite these actions, we identified additional 

opportunities to increase competition and we recommended that OMB 

take several actions—including emphasizing the role of program officials 

in influencing competition, taking steps to better understand the 

circumstances leading to only one offer on competitive contracts, and 

examining how competition advocates are appointed.

OMB has taken steps to increase efficiency and enhance competition in 

government contracting, including responding to previous GAO 

recommendations and issuing guidance to DOD among other agencies. 

Recent initiatives include:

• In July 2009, OMB implemented an initiative to reduce obligations 

through new contracts in fiscal year 2010 by 10 percent in certain 

high-risk categories—including noncompetitive contracts and 

OMB and DOD Are 

Taking Steps to 

Increase Competition
 

Page 20 GAO-12-384 Defense Competition for Services 

competitive procurements that only receive one offer. We recently 

reported on challenges with this initiative.29

• In October 2009, OMB established initial guidelines to help chief 

acquisition officers and senior procurement executives evaluate the 

effectiveness of their agencies’ competition practices and processes

for selecting contract types.30

• The Office of Federal Procurement Policy released new guidance with 

respect to competition in establishing GSA schedule blanket purchase 

agreements in December 2009 in response to our recommendation 

that OMB take greater advantage of the opportunities that competition 

provides under schedule blanket purchase agreements.31

In addition, DOD has taken several actions aimed at increasing 

competition in response to Presidential and congressional actions:

• In June 2010, DOD announced its “Better Buying Power” initiative and 

issued implementing guidance in September 2010, which outlines a 

series of actions and directives to promote competition including:

 

29 GAO, Federal Contracting: OMB’s Acquisition Savings Initiative Had Results, but 

Improvements Needed, GAO-12-57 (Washington, D.C.: Nov. 15, 2011).

30 In March 2009, President Obama directed OMB, in collaboration with certain agency 

heads and others to develop governmentwide guidance to, among other things, assist 

agencies in identifying contracts that are wasteful or inefficient and to formulate 

appropriate corrective action in a timely manner. 

31 GAO, Contract Management: Agencies Are Not Maximizing Opportunities for 

Competition or Savings under Blanket Purchase Agreements despite Significant Increase 

in Usage, GAO-09-792 (Washington, D.C.: Sept. 9, 2009). In March 2011, the FAR 

Council issued an interim rule (effective May 16, 2011), amending the FAR to implement 

section 863 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 

2009, Pub. L. No. 110-417. The interim rule establishes enhanced competition 

requirements for placing orders under multiple-award contracts, including schedule

contracts, and competition requirements for the establishment and placement of orders 

under schedule blanket purchase agreements. It also restricts the circumstances when 

blanket purchase agreements may be established based on a limited-source justification. 
 

Page 21 GAO-12-384 Defense Competition for Services 

• Pursuing open systems architecture and establishing rules for the 

acquisition of technical data rights;32

• Seeking opportunities to increase the role of small businesses in 

defense marketplace competition and opportunities to compete 

multiple award IDIQ service contracts among small businesses; 

and

• Presenting a competitive strategy at each program milestone for 

defense acquisition programs.

• DOD has put particular emphasis on increasing “effective 

competition”—when more than one offer is received under a 

competitive solicitation—and has issued enhanced guidance for 

situations when competitive procedures are used but only one offer is 

received. Specifically, in November 2010 DOD issued a memorandum 

that requires contracting officers to provide additional time for 

contractors to respond to solicitations when only one offer is received, 

if less than 30 days was provided for the receipt of proposals under 

the original solicitation. In addition, if a solicitation allowed at least 30 

days for receipt of offers and only one offer was received, the 

contracting officer must determine prices to be fair and reasonable 

through price or cost analysis or enter negotiations with the offeror.33

• In addition, in July 2010, in response to our recommendations and 

as part of the Better Buying Power initiative, the Chairman of 

DOD’s Panel on Contracting Integrity established a new 

subcommittee tasked with examining improvements for 

 

32 DOD published a final rule in September 2010 (DFARS § 207.106 (S-72)) amending the 

DFARS to implement § 202 of the Weapon Systems Acquisition Reform Act of 2009, Pub. 

L. No. 111-23 requiring, among other things, that acquisition plans for major defense 

acquisition programs include measures to ensure competition or the option of competition 

throughout the program life cycle; the rule stated one way of ensuring competition was 

through the acquisition of complete technical data packages. 75 Fed. Reg. 54524, Final 

rule, Sept. 8, 2010. DFARS Case 2009-D031 is an interim rule amending the DFARS to 

implement section 821 of the National Defense Authorization Act for Fiscal Year 2010, 

Pub. L. No. 111-84 (2009), which authorizes certain types of government support 

contractors to have access to proprietary technical data belonging to prime contractors 

and other third parties, provided that the technical data owner may require the support 

contractor to execute a nondisclosure agreement having certain restrictions and remedies. 

76 Fed. Reg. 11363, Interim rule, March 2, 2011. We previously recommended that DOD 

update policies that clarify requirements for documenting long-term technical-data 

requirements in weapons system program acquisition strategies and acquisition plans. 

GAO-11-469. 

33 In July 2011, DOD proposed an amendment, which has not yet been made final, to the 

DFARS incorporating this requirement. 76 Fed. Reg. 44293, (proposed July 25, 2011). 
 

Page 22 GAO-12-384 Defense Competition for Services 

competitive opportunities and ways to be more effective at 

reducing single source buys. According to a DOD procurement 

policy official, the subcommittee is in the process of reviewing and 

responding to comments on the proposed rule on competitive 

procurements with only one offer, which is expected to be finalized 

in late spring 2012.

• DOD has also taken actions to enhance the competition advocate 

role, such as requiring each component or agency competition 

advocate to develop a plan to improve the overall rate of competition 

by at least two percent per year, and the rate of “effective competition” 

by at least 10 percent per year. DOD also holds quarterly meetings 

where competition advocates from the military services and other 

DOD agencies review the progress toward meeting competition 

procurement goals and discuss challenges and best practices. In 

December 2011, DOD issued a department-wide memorandum 

stating that DOD did not meet its fiscal year 2011 competition goals 

under the Better Buying Power initiative. DOD’s competition advocate 

stated that the department is paying too much for products and 

services and that competition is the key to driving down prices. He 

urged the component competition advocates to continue to identify 

shortcomings in competitive procedures and to communicate new 

ideas with each other on how to implement and improve competition. 

The memorandum also outlines fiscal year 2012 competition goals for 

DOD overall as well as for individual departments and components.

DOD does not establish separate goals for products and services. 

The fiscal year 2012 goal for DOD overall (60 percent) is lower than 

the fiscal year 2011 goal (62.8 percent). According to a DOD 

procurement policy official, competition goals for fiscal year 2012 were 

established based on actual competition rates over the past few 

years.

During our previous work, DOD officials reported they have taken 

additional steps at the component level to enhance competition—such as 

efforts to educate and hold program officials accountable and additional 

review of individual contract actions under class J&As.

• In July 2010, we reported that the Navy has made competition training 

mandatory for personnel engaged in the acquisition process, including 

program managers, program executive officers and logistics 

personnel. In addition, in 2009 a senior Navy official told us that the 

Navy is following up with program managers who previously 

submitted J&As but stated that the requirement would be competed 

the next year to see if program managers are actually competing 

these requirements in the future.
 

Page 23 GAO-12-384 Defense Competition for Services 

• In January 2012, we reported that the Air Force revised its process for 

a recently approved national security class justification for an 

intelligence, surveillance, and reconnaissance program office, 

requiring individual contract actions over $85.5 million to be submitted 

to the Air Force senior procurement executive for expedited review. 

According to an Air Force General Counsel official, the Air Force has 

not yet determined what type of documentation will be required as 

part of that review, but it believes the increased review may identify 

additional opportunities for competition. We recommended that DOD 

evaluate the Air Force’s new review process for national security 

exception actions under class justifications and implement a similar 

process across the department if it is found beneficial; DOD agreed 

with this recommendation.34

In addition to the recent actions DOD has taken, in July 2010, we 

identified other opportunities to increase competition across the federal 

government. These include emphasizing the role of program officials in 

influencing competition, better understanding the circumstances leading 

to only one offer on competitive contracts, and examining how 

competition advocates are appointed. We continue to track the agencies’ 

progress in implementing these recommendations.

We provided a draft of this report to DOD and the department responded 

that it had no comments.

We are sending copies of this report to interested congressional 

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

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

If you or your staff have any questions about this report or need additional 

information, please contact me at (202) 512-4841 or huttonj@gao.gov. 

Contact points for our Offices of Congressional Relations and Public 

 

34 GAO-12-263. 

Agency Comments
 

Page 24 GAO-12-384 Defense Competition for Services 

Affairs may be found on the last page of this report. Staff 

acknowledgments are provided in appendix III. 

John P. Hutton

Director

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

Methodology

Page 25 GAO-12-384 Defense Competition for Services 

The objectives for this review were to examine (1) how competition for 

non-research and development (R&D) services compares to competition 

for products, and trends in competition for non-R&D services at the 

Department of Defense (DOD); (2) the reasons for noncompetitive 

contracts and task orders for services; and (3) steps DOD has taken to 

increase competition for services.

To address these objectives, we identified through the Federal 

Procurement Data System-Next Generation (FPDS-NG) DOD obligations 

under competitive and noncompetitive contracts in fiscal years 2007 

through 2011, the most recent data available when we conducted our 

review.1 For competitive contract actions, we included contracts and 

orders coded as “full and open competition,” “full and open after exclusion 

of sources,” “competitive delivery order,” and “competed under simplified 

acquisition procedures” as well as orders coded as subject to fair 

opportunity and as “fair opportunity given.” For noncompetitive contract 

actions, we included contracts and orders coded as “not competed,” “not 

available for competition,” “not competed under simplified acquisition 

procedures,” “follow-on to competed action,” and “non-competitive 

delivery order” as well as orders coded as subject to fair opportunity and 

under an exception to fair opportunity, including “urgency,” “only one 

source,” “minimum guarantee,” “follow-on action following competitive 

initial action,” and “other statutory authority.”2

 

1 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, and (2) 

reviewing existing information about the data and the system that produced them. We 

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

In addition, we identified 

fiscal year 2011 obligations under contracts where more than one offer 

had been received. We calculated competition rates as the percentage of 

obligations on competitive contracts and orders over all obligations on 

contracts and orders. We focused our review on non-research and 

development (R&D) services to concentrate our analysis on contracts not 

related to development of weapons systems, but conducted limited 

analysis to understand competition rates for R&D services as compared 

to non-R&D services and to products, in fiscal year 2011. We also 

identified trends in competition rates for non-R&D services at DOD 

components from fiscal years 2007 through 2011. We assessed

2 We have previously reported on miscoding errors related to these fields. However, 

system-wide changes were made to FPDS-NG in October 2009 that should have 

mitigated these errors for the time period we reviewed. See GAO-10-833. 

Appendix I: Objectives, Scope, and 

Methodology 
Appendix I: Objectives, Scope, and 

Methodology

Page 26 GAO-12-384 Defense Competition for Services 

competition rates across the 23 non-R&D service categories in FPDS-NG 

as well as across DOD and non-DOD contracting organizations (those 

organizations that obligated funds for services on DOD’s behalf in fiscal 

year 2011).

We also examined the reasons cited in FPDS-NG for not competing DOD 

contracts and orders for services in fiscal year 2011. To do so, we 

selected and reviewed a non-generalizable sample of 111 justification 

and approval (J&A) and exception to fair opportunity documents to 

identify what circumstances led to the award of noncompetitive contracts 

and orders. While agencies are generally required to post J&As to the 

FedBizOpps.gov website, we did not assess whether the available data 

represented the full universe. We used a non-generalizable sample to 

provide illustrative examples of J&As, which was an appropriate approach 

to meet our reporting objective. The J&A documents we reviewed 

included:

• A selection of 77 documents provided by DOD components in 

response to our request for all justification and approval documents 

approved by the senior procurement executives in fiscal year 2011.3

• A selection of 34 DOD J&As posted on the FedBizOpps.gov website.

We selected these to obtain a mix of J&As from: the non-R&D service 

categories with the highest obligations (Maintenance, Repair, and 

Rebuilding of Equipment, Professional, Administrative and 

Management Support, and Construction of Structures and Facilities); 

each major DOD component (Air Force, Army, Navy, and other 

Defense agencies); and approvals at various points throughout fiscal 

year 2011.

Some of these documents were for a mix of products and services 

providing weapons system support.

In addition, we reviewed previous GAO reports, Office of Management 

and Budget and DOD policies and guidance, and DOD competition 

reports for fiscal years 2009 and 2010 to identify reasons for not 

competing contracts as well as actions that have been taken to improve 

competition at DOD. We also reviewed recent GAO interviews with DOD 

officials to identify barriers to competition as well as actions underway or 

planned for the future to improve competition. Interviews were conducted 

 

3 The Federal Acquisition Regulation requires J&As to be approved by DOD senior 

procurement executives when the total value of the acquisition is expected to exceed 

$85.5 million.
Appendix I: Objectives, Scope, and 

Methodology

Page 27 GAO-12-384 Defense Competition for Services 

as part of previous work related to government-wide competition, national 

security competition exception, and acquisition planning.4

We conducted this performance audit from September 2011 to March 

2012, 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.

 

4 See GAO-10-833, GAO-12-263, and GAO-11-672. 
Appendix II: Fiscal Year 2011 DOD Competition 

Rates by Service Category and Component

Page 28 GAO-12-384 Defense Competition for Services 

In fiscal year 2011, competition rates varied significantly among the 23 

non-R&D service categories in FPDS-NG—from 43 to 97 percent. 

Competition rates also varied among the three service categories with the 

highest obligations, which together made up over half of all non-R&D 

services obligations. See table 1.

Table 1: DOD Competition Rates for Non-R&D Service Categories in Fiscal Year 

2011

Service Category

Competition 

Rate

% of Total Fiscal 

Year 2011 nonR&D Services 

Obligations

Purchase of Structures & Facilities 43% 0%

Technical Representative 53% 1%

Quality Control, Testing & Inspection 61% 0%

Photographic, Mapping, Printing & Publishing 63% 0%

Modification of Equipment 63% 0%

Installation of Equipment 64% 1%

Special Studies 68% 2%

Maintenance, Repair & Rebuilding of Equipment 68% 12%

Utilities and Housekeeping 69% 6%

Educational & Training 69% 1%

ADP & Telecommunication 70% 9%

Salvage Equipment 75% 0%

Operation of Government-Owned Facilities 75% 2%

Lease or Rental of Equipment 75% 0%

Support Services (Professional, Administrative, 

Management)

76% 30%

Maintenance, Repair or Alteration of Real Property 76% 6%

Social Services 79% 0%

Natural Resources Management 83% 1%

Lease or Rental of Facilities 85% 0%

Medical Services 87% 9%

Architect & Engineering 90% 2%

Construction of Structures & Facilities 90% 12%

Transportation, Travel & Relocation Services 97% 6%

Total 78% 100%

Source: GAO analysis of FPDS-NG data.

Note: Service categories where the percent of obligations is zero had less than 0.5 percent of total 

DOD non-R&D services obligations in fiscal year 2011. 

Appendix II: Fiscal Year 2011 DOD 

Competition Rates by Service Category and 

Component 
Appendix II: Fiscal Year 2011 DOD Competition 

Rates by Service Category and Component 

Page 29 GAO-12-384 Defense Competition for Services 

In fiscal year 2011, the major DOD components had varying competition 

rates for non-R&D services. The Air Force had the lowest overall 

competition rate (59 percent) while other defense agencies had the 

highest (89 percent). Effective competition—a subset of overall 

competition which DOD defines as competed actions that received more 

than one offer in response to a solicitation—rates also varied across the 

major components (52 percent at the Air Force to 82 percent at other 

defense agencies). The Navy had the highest percentage of competed 

actions with only one offer (16 percent). See figure 5 for competition 

percentages at each major DOD component.

Figure 5: Competition Rates by DOD Component for Non-R&D services in Fiscal 

Year 2011
Appendix III: GAO Contact and Staff 

Acknowledgments

Page 30 GAO-12-384 Defense Competition for Services 

John P. Hutton, (202) 512-4841 or huttonj@gao.gov

In addition to the contact names above, Michele Mackin, Acting Director; 

Alexandra Dew Silva; Peter Anderson; Georgeann Higgins; Julia Kennon; 

Jean McSween; Cary Russell; Kenneth Patton; Sylvia Schatz; Roxanna 

Sun; and Andrea Yohe made key contributions to this report.

Appendix III: GAO Contact and Staff 

Acknowledgments 

GAO Contact

Staff

Acknowledgments

(121015)
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