Government contracting for purchase of service

Kenneth R. Wedel, Ph.D., is Associate Dean and Associate Professor, School of Social Welfare, University of Kansas at Lawrence. Recent developments in the practraining, and employment services, tice of government contracting for soThe extensive use of contractual cial services underscore a number of service arrangements has recently unsolved problems in social welfare come to be applied to state public so policy and focus attention on managecial service programs. Amendments to ment difficulties increasingly prevathe Social Security Act in 1967 au lent in social work agencies. Although thorized state and local public welfare the body of information available on agencies to receive federal matching the subject is fragmented and reflects funds for services purchased from the experience of a wide range of prononprofit or proprietary private grams and organizations in social welsources as well as from other public fare, two important areas of concern agencies. can be identified: (1) the broad polThe most recent legislation, Title icy issue of the relationship between XX, authorizes federal financial par government and the voluntary social ticipation when services are purchased welfare sector, and (2) the more through execution of a written con specific issues of contract managetract and specifies the terms under ment. The following discussion is cenwhich privately donated funds can tered on these two areas, with parrevert to a nonprofit organization pro ticular emphasis on the hazards and viding services. Some states already benefits inherent in government conrely heavily on the contractual proc tracting and on developments in coness to make services available, and structing a model for such contracts, more widespread use of the practice Government contracting for the can be expected as Title XX regula purchase of service has been practions are implemented.3 ticed since Colonial times, and public subsidies to private charities can be traced throughout the history of pubCONTRACT RELATIONSHIPS lie social welfare. Funding methods have included tax concessions, lumpFew issues in social work have re sum subsidies, grants, and per capita ceived as much attention as the rela payments. Contractual agreements tionship between the government and have often been a preferred mode of private social agencies. As voluntary practice.1 Their use increased in popagencies supplement their funds by ac ularity during the growth of social cepting public service contracts, ques services in the 1960s. The incremenlions are raised concerning the future tal, though dramatic, expansion in the of the private voluntary sector. Can it use of contracting highlights the need survive without this public support?4 to examine the efficacy of the policies Will it survive as the boundaries be that guide the practice. tween private and public become in Following the enactment of the creasingly blurred and ambiguous?8 Economic Opportunity Act of 1964, As compelling as these general ques the provision of services by contract tions may be, it is perhaps more became a widespread practice. A cenhelpful to consider issues of specific tral feature of the Community Action policy. A series of such issues is dis Program (CAP) was the authority to cussed below in terms of the potential delegate "portions or all of a comhazards and benefits of government ponent project to another public or contracting, private nonprofit agency by means of a contract or agreement." 2 The ComHazards of Contracting A recurring munity Mental Health Act of 1963, problem for the voluntary service pro with subsequent amendments, also vider is the dilemma of independence gave momentum to contractual arversus governmental control. Volun rangements for services from the voltary agencies are urged to be wary of untary sector. Additional impetus has governmental persuasion and to ac come from a variety of programs in cept contractual arrangements only the areas of health, child welfare, when the values of pluralism can be vocational rehabilitation, manpower preserved.6 Hill advises private agen