Federal Procurement: Spending and Workforce Trends
Published: 2003-04-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The federal government, comprised of more than 60 agencies and nearly 1.7 million civilian workers, acquires most of its goods and services through contracts. Recent changes in what the government buys, its contracting approaches and methods, and its acquisition workforce have combined to create a dynamic acquisition environment. Many of these recent changes enhance contracting efficiency and offer a number of benefits, such as reduced administrative burdens. However, GAO's past work has found that if these changes are not accompanied by proper training, guidance, and internal controls, agency procurements may be at greater risk. While effectively managing contracts is always a key management responsibility, this responsibility is more acute in those agencies that rely heavily on acquisitions to accomplish their missions. The goal of this report is to identify for Congress, the administration, and accountability organizations those procurement-related trends and challenges that may affect federal agencies. Specifically, GAO analyzed recent federal procurement patterns, the use of various procurement methods, and changes in the acquisition workforce.
section_title: What GAO Found
paragraphs: Federal agencies procured more than $235 billion in goods and services during fiscal year 2001, reflecting an 11 percent increase over the amount spent 5 years earlier. Further growth in contract spending, at least in the short term, is likely to increase given the President's request for additional funds for defense and homeland security, agencies' plans to update their information technology systems, and other factors. Overall, contracting for goods and services accounted for about 24 percent of the government's discretionary resources in fiscal year 2001. Federal agencies are taking advantage of the streamlined acquisition processes that were developed in the 1990s, including relying on contracts awarded by other federal agencies to obtain goods and services. The increase in the use of this acquisition method is driven largely by purchases of information technology and by professional, administrative, and management support services. Similarly, agencies are increasingly using purchase cards for many of their low dollar value procurements. Over the last decade, the federal acquisition workforce has had to adapt to changes in staffing levels, workloads, and the need for new skill sets. Procurement reforms have required contracting specialists to have a greater knowledge of market conditions, industry trends, and the technical details of the commodities and services they procure. A priority at most agencies we reviewed was attracting and retaining the right people with the right skills to successfully address the increasingly complex actions expected in the future. Many agencies have made progress with strategic human capital planning efforts. We reviewed 10 agencies that represent over 90 percent of the federal government's acquisition spending. All agencies provided comments on our report and concurred with our analyses.

section_title: Letter
paragraphs: The federal government, one of the largest and most complex organizations  in the world, is comprised of more than 60 agencies and about 1.7 million  civilian workers. The fiscal year 2002 federal budget included more than  $1 trillion in discretionary budget resources, which can be applied to fund  agency operations including the acquisition of goods and services.  Agencies acquire most of their goods and services through contracts that  specify the government’s needs or requirements, the cost or price agreed  upon by the government and the supplier, and other terms and conditions.
Beginning in the early 1990s, a number of factors emerged that created a  dynamic and challenging acquisition environment with ramifications that  are just beginning to be recognized. First, acquisition personnel  increasingly purchase services, such as information technology or  management support. Second, Congress passed several significant pieces  of reform legislation, including the Federal Acquisition Streamlining Act of  1994 and the Clinger-Cohen Act of 1996, to provide agency procurement  officials with greater flexibility and tools to acquire goods and services  more efficiently. Third, the end of the Cold War and efforts to reduce the  size of government led to significant acquisition workforce reductions in  many agencies, most notably the Department of Defense (DOD). These  reductions, coupled with procurement reforms, have placed increasing  demands on the acquisition workforce. For example, contracting  specialists must have a greater knowledge of market conditions, industry  trends, and the technical details of the commodities and services  they procure.
This report is part of our effort to provide Congress, the administration,  and accountability organizations with insights into how these factors  contribute to the acquisition challenges federal agencies face. To do so, we  analyzed (1) recent federal procurement patterns, (2) the use of various  procurement approaches and methods, and (3) changes in the acquisition  workforce and contracting actions. Our analysis covers the 5-year period  that includes fiscal year 1997 through fiscal year 2001, the latest year for  which complete data were available, and focuses on the 10 federal agencies  that spent the most on contracts during fiscal year 2001.
We compiled this information from various sources, including the General  Services Administration’s (GSA) Federal Procurement Data System  (FPDS), which is the government’s repository for federal contract  information; the Office of Management and Budget’s (OMB) MAX Budget  Information System, which is used to collect, validate, analyze, model, and  publish federal budget information; the Office of Personnel Management’s  Central Personnel Data File (CPDF), which is the government’s human  resources reporting system; agency officials; and Inspector General  reports. We did not verify these data independently. Unless otherwise  noted, all data in the report are reflected in constant fiscal year 2001  dollars. More information on our scope and methodology may be found in  appendix I.
This report does not reflect changes in agency missions, organizational  structures, budgets, contracting actions, or personnel resulting from the  creation of the Department of Homeland Security. This department,  established on January 24, 2003, combined 22 federal agencies specializing  in various missions, such as law enforcement, border security, biological  research, computer security, and disaster mitigation. With an anticipated  budget of almost $40 billion and an estimated 170,000 employees, the  department is expected to be the third largest federal agency, with the  potential for some of the government’s most extensive acquisition  requirements.
subsections: section_title: Trends in Federal Procurement Spending Patterns
paragraphs: Federal agencies spent more than $235 billion in fiscal year 2001 to buy  goods and services ranging from weapon systems and medical equipment  to information technology services and the operation of government  facilities. This is an 11 percent increase over the amount spent in 1997. This  growth is expected to continue as federal agencies address emerging  threats and acquire enhanced information technology.
The significance of contracting in the federal government is reflected by  the sheer magnitude and the degree to which contracting consumes  agencies’ discretionary resources. Overall, contracting for goods and  services accounted for about 24 percent of the government’s discretionary  resources in fiscal year 2001. However, contract spending consumed  between 34 percent and 73 percent of the discretionary resources available  to the four largest acquisition spending federal agencies.
subsections: section_title: Recent Growth in Federal Procurement
paragraphs: Federal contracting increased by 11 percent during the 5-year period we  studied, from about $213 billion in fiscal year 1997 to over $235 billion in  fiscal year 2001. As shown in figure 1, DOD is the largest agency in terms  of contracting dollars spent, accounting for about two-thirds of the  government’s total spending on goods and services. In fiscal year 2001,  DOD contracted for more than $152.6 billion of goods and services, or  more than twice the amount spent by the next nine largest federal agencies  combined. The three military departments—the Air Force, Army, and  Navy—individually spend more than the largest civilian agency, the  Department of Energy (DOE).
From fiscal years 1997 through 2001, purchases of goods increased by  17 percent. This was due in large measure to DOD’s increased spending on  weapon systems and other defense-related items. Overall, however,  agencies continued to purchase far more services than goods. Purchases  of services grew by about 11 percent, as agencies modernized their  information systems and obtained various professional, administrative, and  management support services. Nine of the 10 agencies we reviewed  increased their spending on services. The other agency, the National  Aeronautics and Space Administration (NASA), experienced a 4 percent  decrease, reflecting significant reductions in spending for research and  development and for professional, administrative, and management  support services. As shown in figure 2, agencies varied in the degree to  which they contracted for services. For example, DOE spent more than  98 percent of its contract dollars on services in fiscal year 2001, while the  Department of Agriculture’s (USDA) spending for services accounted for  only about 30 percent of its acquisition spending.
The degree to which individual agencies contract for services underscores  the importance of ensuring that service acquisitions are managed properly.  For example, we noted in May 2001 that some service procurements were  not being conducted efficiently, putting taxpayer dollars at risk. Last year,  we reported that leading commercial companies had taken a strategic  approach to acquiring services, which in turn resulted in significant cost  savings and service improvements. Taking a strategic approach involves a  range of activities—from developing a better picture of what the company  is spending on services, to taking an enterprisewide approach to procuring  services, to developing new ways of doing business. Based in part on our report, the National Defense Authorization Act For Fiscal Year 2002  required that DOD develop enhanced data collection and management  processes for services acquisitions. Additionally, as will be discussed in  greater detail in the next section, Congress and the administration are  encouraging the use of performance-based approaches to acquiring  services as a way of improving the acquisition of services.
section_title: Acquisition Activity Varies by Agency
paragraphs: Agencies rely to various degrees on private vendors to provide the  goods and services needed to carry out their missions and support their  operations. Overall, contracting for goods and services accounted for  24 percent of the government’s discretionary resources in fiscal year 2001.  For four agencies included in our review—DOE, NASA, GSA, and DOD— the acquisition function is central to accomplishing their mission-related  goals. About 76 percent of DOE’s funds, for example, are spent on the  management and operation of over 30 government-owned laboratories and  other nuclear facilities. NASA contracts account for about 72 percent of its  discretionary budget resources, and one of GSA’s primary missions is to  help federal agencies procure goods and services. However, spending on  contracts accounted for less than 23 percent at each of the other six  agencies in our review, as shown in figure 3.
section_title: Further Growth in Contract Spending Is Likely
paragraphs: Further growth in contract spending, at least in the short term, is likely  given the President’s request for additional funds for defense and  homeland security, agencies’ plans to update their information technology  systems, and other factors. For example, the President’s fiscal year 2004  budget request reflects steady increases in DOD’s discretionary budget  authority, as well as increases in the budgets of other agencies involved in  homeland security. Additionally, the President’s budget request reflects  increased investment in information technology both for new systems and  for related support.
Further, the administration’s emphasis on competitive sourcing could  increase agencies’ reliance on services provided by the private sector.  Competitive sourcing in the federal government is conducted under  guidance provided in OMB Circular A-76, which outlines procedures for  determining whether to perform a commercial activity with government  employees or by contract. Additionally, the circular provides policy for  standardizing how and when an agency competes a commercial activity  with the private sector. OMB’s current 2-year goal is to compete 15 percent  of the federal government’s commercial-type positions. This effort could  result in significant increases in the number of service contracts, given that  in the past the private sector has won over half of the competitions.
section_title: Emerging Trends in Procurement Methods and Approaches
paragraphs: The past decade has seen the emergence of several procurement trends  that have changed the way the government acquires goods and services,  as Congress and the administration have sought ways to simplify the  acquisition process, shorten procurement times, reduce administrative  burdens and costs, and improve acquisition outcomes. In particular, federal  agencies are increasingly relying on contracts awarded by other federal  agencies to obtain goods and services and have turned to using government  purchase cards for many of their low dollar value procurements. The  growth in these procurement methods has been dramatic, and is apparent  in nearly every agency we reviewed. Additionally, agencies have begun to  increase their use of commercial contracting methods and performance- based acquisition approaches.
As we have reported previously, taking full advantage of these methods and  approaches requires that agencies have adequate guidance and training, a  strong internal control environment, and data that can be used by agency  management to make informed decisions. Our work at selected agencies  has found that these conditions have not always been present, thereby  contributing to agencies missing opportunities to achieve savings, reduce  administrative burdens, and improve acquisition outcomes.
subsections: section_title: Agencies’ Use of Contracts Awarded by Other Agencies
paragraphs: Federal agencies are increasingly using contracts and acquisition services  offered by other agencies, a fact that is most notably demonstrated in the  growth of GSA’s Federal Supply Schedule and governmentwide acquisition  contracts (GWAC). These interagency contracts are being used in a  variety of situations, from those in which a single agency provides limited  contracting assistance to a more comprehensive approach in which  the provider agency’s contracting officer handles all aspects of the  procurement. Agencies charge users of these contracts a fee to cover  administrative expenses. GSA’s schedule program enables federal agencies  to quickly acquire goods and services, thereby helping them to, among  other objectives, reduce lead times and lower administrative costs. GSA  does this by awarding contracts to vendors and making these contracts  available for use by other agencies. GWACs are intended to facilitate  purchases of information technology-related products and services, such  as network maintenance and technical support, systems engineering, and  integration services.
As shown in figure 4, sales under the schedule program have more than  tripled over the past 5 years, increasing from $4.3 billion in fiscal year 1997  to about $14.4 billion in fiscal year 2001. Agency officials at each of the  agencies we reviewed reported increases in their use of the schedules  program over the past 5 years, driven largely by increased purchases of  information technology and professional, administrative, and management  support services.
As shown in table 1, DOD and GSA, the largest users of the schedules  program, accounted for about 75 percent of schedule sales in fiscal year  2001. GSA’s increased share is largely attributable to the growth of GSA’s  Federal Technology Service, which places orders under the schedule for  information technology services and equipment on behalf of other federal  agencies. However, orders placed by the Federal Technology Service are  counted as spending by GSA, rather than as spending by the federal agency  that will ultimately receive the service or equipment.
Agency officials also reported that their use of GWACs increased  considerably over the 5-year period between fiscal years 1997 and 2001. For  example, USDA reported an increase from about $5.1 million to $44 million,  and Treasury reported an increase from $92 million to $155 million.  Officials at the other eight agencies we reviewed reported that they also  increased their use of GWACs; however, they could not provide detailed  GWAC information because this spending was not an integral part of their  management information systems. While GSA officials indicated that they  have not modified the FPDS to collect specific information on GWAC  spending, several officials at other agencies stated that they either are  collecting or will begin to collect additional information on their agencies’  GWAC use.
While use of these interagency contracting methods can allow agencies to  meet their needs quickly, our past work has shown that agencies are not  adequately adhering to guidelines on competition. Further, recent agency  Inspector General reports noted that DOD, VA, and NASA personnel did not  consistently follow procedures intended to promote competition or ensure  fair and reasonable prices when using these interagency contract methods  to acquire information technology services, medical equipment, or research  and development projects.
section_title: Purchase Cards
paragraphs: Purchase card spending has increased significantly governmentwide.  This program provides federal agencies a low-cost and efficient means  for quickly obtaining goods and services directly from vendors.
Under the Federal Acquisition Regulation, the commercial purchase card is  now the preferred method of paying for micropurchases. The purchase  card may also be authorized to be used in greater dollar amounts and may  be used to make payments under existing contracts.
As figure 5 shows, governmentwide purchase card use increased  from $5.3 billion in fiscal year 1997 to $13.8 billion in fiscal year 2001—a  160 percent rise. Increases in purchase card use in the agencies we  reviewed ranged from 45 percent to 344 percent.
As figure 6 shows, agencies used purchase cards to varying degrees.  DOD was the largest user of purchase cards, spending about $6.1 billion  in fiscal year 2001. VA was the largest civilian agency user of the  purchase card program, spending about $3.8 billion. VA officials noted  that due to VA’s organizational structure and its continuous need for  disposable medical and surgical supplies, purchase cards are one of  VA’s key procurement techniques and are used extensively as a payment  mechanism.
During the past 2 years, we found that significant internal control  weaknesses in several agency purchase card programs allowed  cardholders to make fraudulent, improper, abusive, or questionable  purchases that resulted in lost, missing, or misused government property.
Agencies are responding to the recommendations that we and others have  made regarding internal control weaknesses. For example, the Navy has  reduced the number of cardholders by more than 50 percent, from 59,000  in June 2001 to 25,000 by March 2002, thus improving the likelihood of  effective program management. Additionally, DOD has begun  implementing new training and approval processes. For example, DOD  implemented automated controls during fiscal year 2002 to help with  monitoring credit limits, cardholder reconciliation, and approving officials’  review of monthly statements. Further, OMB requires that agencies provide  quarterly reports on their efforts to improve the management oversight  of government-issued purchase and travel cards.
section_title: Use of Streamlined Procedures to Acquire Commercial Items
paragraphs: In recent years, there has been a significant increase in agencies’ use of  streamlined procedures to acquire commercial items. Many procurement  reform advocates have recommended that federal agencies purchase  commercial items to save money and reduce acquisition time, rather than  pay companies to develop unique items for the government’s use. The  Federal Acquisition Streamlining Act established a preference for the  acquisition of commercial items. Because commercial items are subject  to competitive market forces, they may be acquired using streamlined  solicitation and evaluation procedures generally provided for under part 12  of the Federal Acquisition Regulation (FAR). For example, contracting  officers may reduce the time needed to solicit bids and award contracts by  combining certain steps in the solicitation process, using streamlined  evaluation techniques, and eliminating certain administrative requirements.
In fiscal year 2001, the purchase of commercial items using FAR part 12  procedures accounted for 19 percent of the spending for goods and  services by federal agencies, up from 9 percent 5 years earlier. From  fiscal year 1997 through fiscal year 2001, governmentwide use of part 12  procedures increased by 148 percent. As shown in table 2, 9 of the 10  agencies in our review increased their use of part 12 procedures by at least  100 percent.
section_title: Performance-Based Service Contracting
paragraphs: Significant growth in service contracts has led Congress and the  administration to encourage greater use of performance-based service  contracting to achieve greater cost savings and better outcomes. Under  performance-based approaches, the contracting agency specifies the  outcome or result it desires and lets the contractor decide how best to  achieve the desired outcome. Performance-based contracts offer  significant benefits, such as encouraging contractors to innovate and find  cost-effective ways of delivering services. In fiscal year 2001, agencies  reported that 24 percent of their eligible service contracts, by dollar value,  were considered performance based.
There was wide variation in the extent to which agencies used  performance-based contracts. As figure 7 shows, 3 of the 10 agencies in our  review fell short of OMB’s goal that 10 percent of their eligible service  contracts be performance based in fiscal year 2001.
We recently found that some agencies achieved only mixed success  in incorporating four basic performance-based attributes into their  contracts. These attributes include describing desired outcomes rather  than how the services should be performed, setting measurable  performance standards, describing how the contractor’s performance  will be evaluated, and establishing positive and negative incentives, as  appropriate. Our review raised questions as to whether agencies have an  adequate understanding of performance-based contracting and how to take  full advantage of this approach. Agency officials themselves pointed to the  need for better guidance on performance-based contracting and better  criteria for identifying which contracts should be called “performance  based.” In response to our recommendations, the Office of Federal  Procurement Policy is developing new guidance to help agencies improve  their use of performance-based contracting.
section_title: Acquisition Workforce and Workload Trends
paragraphs: Over the last decade, the federal acquisition workforce has had to adapt  to changes in staffing levels, workloads, and the need for new skill sets.  Procurement reforms have placed unprecedented demands on the  acquisition workforce. For example, contracting specialists are required  to have a greater knowledge of market conditions, industry trends, and  the technical details of the commodities and services they procure.  Governmentwide data indicate that in fiscal year 2001 both the number of  acquisition workforce employees and the number of contract actions  declined slightly from fiscal year 1997 levels. However, the extent to which  these changes occurred varied from agency to agency. Ensuring that  agencies will have the right people with the right skills to successfully meet  the increasingly complex demands expected in the future has become a  priority at most of the agencies we reviewed. While agencies still face many  hurdles, our recent work has found that most agencies have taken steps to  address their strategic human capital planning challenges.
subsections: section_title: Current Acquisition Workforce
paragraphs: As of September 2001, the federal acquisition workforce included about  103,000 individuals, reflecting an overall 5 percent decline from 1997 levels.  As shown in table 3, changes in the acquisition workforce varied by agency;  for example, 6 of the 10 agencies we reviewed lost between 2 percent and  9 percent of their acquisition workforces, while the other 4 agencies  increased their acquisition workforces by between 8 percent and  11 percent. DOD experienced the largest personnel decrease in its  acquisition workforce, declining by 9 percent to just over 68,500 personnel.
Changes in the acquisition workforce have been accompanied by changes  in the types of actions being managed. The total number of contract actions  processed in fiscal year 2001 decreased 6 percent from fiscal year 1997  levels. As shown in table 3, our analysis indicates that while most agencies  are processing fewer smaller actions—those valued at less than $25,000— most agencies are also managing an increased number of larger actions.  Agencies have made far greater use of purchase cards for making their  smaller dollar purchases, which accounts for the declining rate of smaller  dollar actions. While we have not evaluated how these changes have  affected federal agencies as a whole, the DOD Inspector General noted  in 2000 that the increased contract workload was adversely affecting  contract oversight by creating imbalances and backlogs in closing out  completed contracts.
section_title: Agencies Showing Progress in Strategic Human Capital Planning Efforts
paragraphs: The changes in staffing levels and workload come at a time when the role  of the government’s acquisition staff is changing considerably. Federal  agency officials expect their acquisition personnel to analyze business  problems and help develop strategies in the early stages of the acquisition  process. Industry and government experts recognize that a key to making a  successful transformation toward a more sophisticated acquisition  environment is having the right people with the right skills. To accomplish  this, leading public organizations in the United States and abroad have  found that strategic human capital management must be the centerpiece of  any serious change management initiative. Strategic management of  human capital is a key governmentwide initiative in the President’s  Management Agenda.
One aspect of strategic human capital planning is succession planning,  where an agency identifies its future needs in terms of workforce skills and  numbers. Our prior work has shown that when workforce reductions do  not consider future needs—such as a staff reduction at DOD during the  1990s—the result is a workforce that is not balanced with regard to  experience and skill sets. The need for planning is underscored by the fact  that, similar to human capital challenges across a variety of occupation  categories, all agencies face the prospect of losing many of their skilled  acquisition personnel over the next 5 years. As shown in figure 8, about  38 percent of acquisition personnel governmentwide are either already  eligible to retire or will be eligible by September 30, 2007. At DOD and  DOE—the two largest contracting agencies in our review—39 percent of  the acquisition workforce will be eligible to retire by fiscal year 2008; at the  other eight agencies, between 30 to 36 percent of their current workforces  will be eligible to retire.
Our recent reviews of how agencies are addressing their future acquisition  workforce needs found that all of the agencies we reviewed have made  progress. For example, the agencies have either published or drafted  human capital strategic plans for their overall workforces or for their  acquisition workforces, and some are revamping training, recruitment, and  retention programs to address future workforce needs. However, these  agencies have encountered challenges, in part due to shifting priorities,  missions, and budgets that make it difficult to predict with any certainty  the specific skills and competencies their acquisition workforces will need.  Further, many agencies simply lack good data on their workforces, such as  size and location, knowledge and skills, and attrition and retirement rates.  This information is critical to mapping out the current condition of the  workforce and deciding what needs to be done to ensure that each agency  has the right mix of skills and talent for the future.
section_title: Conclusions
paragraphs: Effectively managing federal contracts is essential to ensuring that the  more than $235 billion spent annually through contracts provides high- quality goods and services that meet the users’ needs in a timely fashion.  While managing spending effectively is always a key management  responsibility, the need for effective management is more acute in agencies  that rely heavily on acquiring goods and services to carry out their missions  or support their operations.
Changes in what the government buys, its contracting approaches and  methods, and its acquisition workforce combine to create a dynamic  acquisition environment. The purpose of introducing or expanding  streamlined purchase methods, such as GWACs, purchase cards, and  supply schedules, was to enhance contracting efficiency, reduce  administrative burdens, lower transaction costs, and shorten procurement  times. However, our work has found that the lack of proper training,  guidance, and internal controls can increase an agency’s procurement risk  and lead to reduced public confidence. While agencies are taking  corrective actions to address these concerns, many actions remain in the  early stages of implementation.
section_title: Agency Comments and Our Evaluation
paragraphs: We requested comments on a draft of this report from each of the agencies  we reviewed, as well as from the Office of Federal Procurement Policy.  Each agency provided comments, generally via electronic mail. Agency  officials concurred with our analyses and provided technical comments,  which we incorporated as appropriate.
Some agencies noted that their internal data systems contained  procurement data that differed from that contained in the Federal  Procurement Data System or contained workforce data that differed from  that reflected in the Central Personnel Data File. For example, DOE and  VA officials noted that their systems indicated higher use of performance- based contracting than the data contained in Federal Procurement Data  System. We have noted these differences where appropriate in the report.  Additionally, HHS and DOT officials noted that their definitions of their  acquisition workforces differed from what we used. Because there is no  commonly accepted definition of the acquisition workforce, we elected to  use a consistent definition, as discussed in our scope and methodology, to  better enable cross-agency comparisons.
We are sending copies of this report to the Director, Office of Management  and Budget; the Administrator, Office of Federal Procurement Policy; the  Secretaries of Agriculture, Defense, Energy, Health and Human Services,  Transportation, Treasury, and Veterans Affairs; the Administrator of  General Services; the Administrator, National Aeronautics and Space  Administration; the Attorney General; and interested congressional  committees. We will also provide copies to others on request. This report  will also be available at no charge on GAO’s Web site at http://www.gao.gov.
Major contributors to this report were Don Bumgardner, Chad Holmes,  Kevin Heinz, Robert L. Ackley, Julia Kennon, Gary Middleton, John W.  Mingus, Jr., John Van Schaik, Greg Wilmoth, and Suzanne Melancon.
If you have any questions about this report, please contact me at  (202) 512-4841 or Timothy J. DiNapoli at (202) 512-3665.
section_title: Scope and Methodology
paragraphs: To identify spending, procurement methods, and acquisition workforce  trends, we judgmentally selected 15 data elements. These elements are not  intended to be all-inclusive or exhaustive; rather, they reflect data relevant  to key issues and trends identified in prior GAO reports or that provide  basic information valuable to understanding an agency’s procurement  function and approach. We reviewed these elements with senior  procurement officials at each of the agencies we reviewed; these officials  generally agreed that such elements provided useful and relevant  information for gauging their agencies’ procurement activities.
We obtained data on these elements from the General Services  Administration’s Federal Procurement Data Center (FPDC), agency  officials, and the Office of Management and Budget (OMB). FPDC  administers the Federal Procurement Data System (FPDS), which is the  federal government’s central database on contracting actions. FPDS  contains detailed information on contracting actions over $25,000,  including contract type, amount obligated, the types of goods or services  purchased, and various vendor characteristics. FPDS contains less detailed  information on actions of $25,000 or less. Because FPDC relies on federal  agencies for procurement information, these data are only as reliable,  accurate, and complete as the information reported by the agencies. We did  not independently verify the information contained in the database.  However, in 1998, FPDC conducted an accuracy audit, which showed that  the average rate of accurate reporting in the FPDS database was 96  percent. GAO used data from FPDS that covered the 5-year period fiscal  year 1997 through fiscal year 2001, the last year for which complete data  were available. We subsequently adjusted the data provided by DOD to  FPDS to correct for a fiscal year 2001 reporting error.
We obtained additional information from agency procurement officials for  certain data elements that were not readily available from FPDS, such as  their agency’s use of governmentwide acquisition contracts. Additionally,  we obtained data from the Federal Aviation Administration, which is not  required to submit information to the FPDC. We reflected this data in the  governmentwide analyses, as well as in the Department of Transportation’s  profile. We also asked each agency to provide a description of its key  procurement initiatives undertaken during the past 2 years. We did not  independently verify the information provided or assess the degree to  which agency-reported initiatives achieved their objectives.
We collected information on each agency’s discretionary resources from  the Office of Management and Budget’s MAX Budget Information System,  which is used to collect, validate, analyze, model, and publish federal  budget information. Discretionary budget resources reflect the budget  amount that the agency is appropriated for a current fiscal year plus the  budget authority that the agency carries over from prior fiscal years.
Unless otherwise noted, all figures were adjusted for inflation and  represent constant fiscal year 2001 dollars.
To determine trends in the acquisition workforce, we analyzed data  obtained from the Office of Personnel Management’s Central Personnel  Data File (CPDF), which is the governmentwide human resources  reporting system. The data we used reflect information on permanent  employees reported to the CPDF as of September 30 of the particular year.  The CPDF relies on agencies to ensure that the data are timely, accurate,  complete, and edited in accordance with OPM standards. There is no  standard definition of what constitutes an agency’s acquisition workforce,  and agencies have defined their workforces in various ways. To provide  consistency and comparability among agencies, we defined the acquisition  workforce as those individuals serving in the following 14 occupation  series: 1. GS-246: Industrial relations 2. GS-346: Logistics management 3. GS-511: Auditors 4. GS-1101: General business 5. GS-1102: Contracting series 6. GS-1103: Industrial property manager 7. GS-1104: Property disposal 8. GS-1105: Purchasing officer 9. GS-1106: Procurement clerical support 10. GS-1150: Industrial specialists 11. GS-1152: Production control 12. GS-1910: Quality assurance 13. GS-2003: Supply management 14. GS-2010: Inventory management Table 4 provides additional information on the data elements we included  in each agency’s profile.
We reviewed each agency profile with senior agency procurement officials  and incorporated their comments where appropriate.
We conducted this work between September 2002 and March 2003 in  accordance with generally accepted government auditing standards.
section_title: Appendix II: Section 1–Department of Defense
subsections: section_title: Agency Overview and Highlights
paragraphs: Mission: To support and defend the Constitution of the United States; provide for the common defense of the  nation, its citizens, and its allies; and protect and advance U.S. interests around the world.
The following departments combine for the majority of Department of Defense’s (DOD) fiscal year 2001 total  discretionary budget resources:  The Army accounted for 25 percent.
The Air Force accounted for 23 percent.
The Navy accounted for 21 percent.
Other defense agencies account for 31 percent.
DOD’s discretionary resources increased by 10 percent from fiscal year 1997 through fiscal year 2001 and  totaled $446.3 billion in fiscal year 2001. Over the 5-year period, the proportion of DOD’s discretionary  resources spent under contracts remained stable at 34 percent.
DOD’s purchases of goods have increased by 23 percent and totaled $66.1 billion in fiscal year 2001.
Purchases of services for contracts over $25,000 increased by 7 percent over the 5-year period, accounting  for more than 54 percent of DOD’s contracts, or about $77.0 billion, in fiscal year 2001.
Over the 5-year period, DOD’s service spending was driven by increased spending for information  technology (46 percent); professional, administrative, and management support (21 percent); and medical  services (22 percent).
Although slightly declining since fiscal year 1997, research and development contracts accounted for about  28 percent, or $21.5 billion, of DOD’s total service spending in fiscal year 2001.
Over the 5-year period, spending changed on the following goods: ships (128 percent) and aircraft  DOD spent about $143.1 billion on contracts over $25,000 in fiscal year 2001, with firm fixed-price and other  kinds of fixed-price contracts accounting for over 63 percent of DOD’s contract dollars.
Since fiscal year 1997, the amount of contract dollars awarded under competitive procedures was about  58 percent of DOD’s total contract dollars over $25,000.
Purchase card use has increased by 169 percent over the 5-year period, totaling $6.1 billion in fiscal year  2001. In fiscal year 2001, DOD authorized the use of 230,646 purchase cards.
In fiscal year 2001, about 23 percent of DOD’s eligible contracts were performance based.
DOD’s total workforce and acquisition workforce have declined by 9 percent since fiscal year 1997, continuing  a decade-long decline that began in the early 1990s. DOD’s total workforce decreased to about 629,000 and the  acquisition workforce decreased to about 69,000 in fiscal year 2001.
Over 90 percent of DOD’s acquisition workforce has at least 10 years of federal service; by fiscal year 2008,  39 percent will be eligible to retire.
Improve the credibility and effectiveness of the acquisition and logistics support process.  Change budgeting, procurement, program management, and logistics processes and policies to support  implementation of evolutionary acquisition and reduce cycle time.
Improve logistics responsiveness and supply chain integration to make DOD’s logistics system   Implement reforms to increase efficiency and effectiveness in the acquisition of services and improve  support of socioeconomic programs.
Revitalize the quality and morale of the DOD acquisition workforce.  Improve training and education by building a new learning environment designed to empower each DOD  acquisition workforce member with more control over learning needs.
Establish a life-cycle workforce management approach to the civilian workforce, including human capital   Use new outreach and communication strategies to create better awareness and knowledge of acquisition  Improve the health of the defense industrial base.  Establish a strategic approach to adopt commercial acquisition processes.
section_title: V. Key Procurement Reports
paragraphs: Sourcing and Acquisition: Challenges Facing the Department of Defense. GAO-03-574T. Washington, D.C.:  March 19, 2003.
Major Management Challenges and Program Risks: Department of Defense. GAO-03-98. Washington, D.C.:  January 2003.
Purchase Cards: Control Weaknesses Leave Army Vulnerable to Fraud, Waste, and Abuse. GAO-02-732.  Washington, D.C.: June 27, 2002.
Acquisition Workforce: Department of Defense’s Plans to Address Workforce Size and Structure Challenges.  GAO-02-630. Washington, D.C.: April 30, 2002.
Contract Management: DOD Needs Better Guidance on Granting Waivers for Certified Cost or Pricing  Data. GAO-02-502. Washington, D.C.: April 22, 2002.
Purchase Cards: Continued Control Weaknesses Leave Two Navy Units Vulnerable to Fraud and Abuse.  GAO-02-506T. Washington, D.C.: March 13, 2002.
Best Practices: Taking A Strategic Approach Could Improve DOD’s Acquisition of Services. GAO-02-230.  Washington, D.C.: January 18, 2002.
DOD Systems Modernization: Continued Investment in the Standard Procurement System Has Not Been  Justified. GAO-01-682. Washington, D.C.: July 31, 2001.
Contract Management: Not Following Procedures Undermines Best Pricing Under GSA’s Schedule.  GAO-01-125. Washington, D.C.: November 28, 2000.
Acquisition Reform: DOD’s Guidance on Using Section 845 Agreements Could Be Improved.  GAO/NSIAD-00-33. Washington, D.C.: April 7, 2000.
Contract Management: Few Competing Proposals for Large DOD Information Technology Orders.  GAO/NSIAD-00-56. Washington, D.C.: March 20, 2000.
Report Number D-2002-075—Controls Over the DOD Purchase Card Program, March 29, 2002.
Report Number D-2000-100—Contracts for Professional, Administrative, and Management Support  Services, March 10, 2000.
Report Number D-2000-088—DOD Acquisition Workforce Reduction Trends and Impacts, February 29, 2000.
section_title: Appendix II: Section 2–Department of the Air Force
subsections: section_title: Agency Overview and Highlights
paragraphs: The Air Force’s total discretionary budget resources, after declining between fiscal years 1997 and 1999,  increased by 8 percent between fiscal years 2000 and 2001 and totaled $101.1 billion in fiscal year 2001. Over  the 5-year period, the proportion of the Air Force’s discretionary resources spent through contracts increased  from 36 percent to about 40 percent.
Since fiscal year 1997, Air Force spending has been driven by a 16 percent increase in the purchases of  goods. In fiscal year 2001, service contracts remained steady at $20.9 billion, or about 53 percent of Air  Force’s contracts over $25,000.
Research and development contracts decreased by 7 percent during the 5-year period, totaling $8.9 billion in   The Air Force increased its combined purchases of aircraft components and related parts by 64 percent— spending about $13.0 billion on these items in fiscal year 2001. In addition, the Air Force changed its  spending in other categories: information technology services (94 percent); aircraft engines and related  parts (71 percent); professional, administrative, and management support (15 percent); and repair of  equipment (-41 percent).
The Air Force spent about $40 billion through contracts over $25,000 in fiscal year 2001, with firm fixed-price  and other kinds of fixed-price contracts accounting for about 62 percent of the Air Force’s total contract  dollars.
About 24 percent of the Air Force’s eligible service contracts are performance based.
Purchase card spending increased by almost 200 percent over the 5-year period. In fiscal year 2001,  the Air Force authorized the use of 79,762 purchase cards.
The Air Force’s significant increase in its use of the federal supply schedule has been driven by purchases  The Air Force’s total workforce and acquisition workforce decreased by 9 percent from fiscal year 1999  through fiscal year 2001.
By fiscal year 2008, about 38 percent of the current acquisition workforce will be eligible to retire.
The Army’s total discretionary budget resources decreased 4 percent from fiscal year 1997 to fiscal year 2001  and totaled $113.1 billion in fiscal year 2001. The amount spent through contracts accounted for more than  one-third of the Army’s discretionary resources in fiscal year 2001.
Spending on goods increased by about 29 percent over fiscal year 1997 levels. In particular, the Army nearly  tripled its spending on aircraft and increased its spending on ground vehicles by 66 percent.
Spending on services increased by about 15 percent over the 1997 level, driven by a 55 percent increase in  spending for professional, administrative, and management support contracts. Such contracts now account  for 16 percent of the Army’s service contract spending, up from less than 12 percent in fiscal year 1997.
The Army’s spending for research and development increased by about 8 percent over fiscal year  Of the $37 billion the Army spent on contracts over $25,000 in fiscal year 2001, $21.7 billion, or 59 percent, was  spent using firm fixed-price contracts.
Between fiscal years 1997 and 2001, purchase card use increased 139 percent, to $2.5 billion in fiscal year  2001. In fiscal year 2001, the Army authorized the use of 109,446 purchase cards.
During the 5-year period, about 59 percent of the Army’s contract dollars were spent on competitively   In fiscal year 2001, 25 percent of the Army’s service contracts were performance based.
The Army’s use of the federal supply schedule program increased by more than 190 percent over the 5-year  period. This increase was driven primarily by the increased purchases of services, which rose from about  $604 million in fiscal year 1997 to over $1.7 billion in fiscal year 2001.
From fiscal year 1997 through fiscal year 2001, the Army’s total workforce and acquisition workforce  decreased by 6 and 7 percent, respectively. Throughout this period, the acquisition workforce accounted for  about 8 percent of the total workforce.
In fiscal year 2001, 61 percent of the acquisition workforce had 20 years or more of federal service, while  4 percent had fewer than 5 years of federal service.
By fiscal year 2008, 40 percent of the current acquisition workforce will be eligible to retire.
The Navy’s total discretionary budget resources increased 12 percent from fiscal year 1997 to fiscal year 2001  and totaled $95.3 billion in fiscal year 2001. The proportion of the Navy’s discretionary resources spent through  contracts was about 45 percent in fiscal year 2001.
From fiscal years 1997 through 2001, a 25 percent increase in spending for goods, coupled with a 6 percent  decline in spending on services, resulted in the Navy spending nearly as much on goods as on services in  fiscal year 2001. The principal causes of this shift were significant increases in spending on ships (up  133 percent) and decreased spending on research and development (down 17 percent).
The Navy relies on a mix of fixed-price and cost-type contracts to achieve its mission. For example, in  fiscal year 2001, firm fixed and other kinds of fixed-price contracts accounted for more than 53 percent  of the Navy’s total contract dollars, while another 42 percent was spent under cost-type contracts.
In fiscal year 2001, more than half of the Navy’s contract dollars were awarded under noncompeted  contracts. Further, 16 percent of the Navy’s competitively awarded dollars were made on contracts in  which only 1 offer was received.
The Navy’s use of the federal supply schedule program increased by more than 227 percent over the 5-year  period. This increase was driven primarily by the increased purchases of services, which rose from  about $132 million in fiscal year 1997 to over $1.1 billion in fiscal year 2001.
Purchase card use has increased by 185 percent over the 5-year period. In fiscal year 2001, the Navy spent  about $1.8 billion with 27,926 purchase cards.
About 15 percent of Navy’s eligible service contracts were considered performance based in  Since fiscal year 1997, both the Navy’s total workforce and its acquisition workforce have declined by about  10 percent, to about 176,000 and 15,000, respectively.
In fiscal year 2001, more than 60 percent of the Navy’s acquisition workforce had 20 years or more of  service; conversely, only 11 percent had fewer than 10 years of service.
By fiscal year 2008, about 40 percent of the Navy’s acquisition workforce will be eligible to retire.
Mission: To support agriculture production by ensuring a safe, affordable, nutritious, and accessible food  supply; caring for agricultural, forest, and range lands; supporting sound development of rural communities;  providing economic opportunities for farm and rural residents; expanding global markets for agricultural and  forest products and services; and working to reduce hunger in America and throughout the world.
The following components account for the majority of the Department of Agriculture’s (USDA) fiscal year 2001  total discretionary budget resources:  The Forest Service manages public lands in national forests and grasslands. In fiscal year 2001, the Forest  Service accounted for 21 percent of USDA’s discretionary resources.
Food and Nutrition Service provides better access to food and a more healthful diet through its food  assistance programs and comprehensive nutrition education efforts. In fiscal year 2001, the Food and  Nutrition Service accounted for 20 percent of USDA’s discretionary resources.
Other key components, which combined to account for about 21 percent of USDA’s discretionary  resources, include the Farm Service, the Rural Housing Service, and the Rural Development Service.
USDA’s discretionary resources increased by 18 percent between fiscal years 1997 and 2001 and totaled  $23.5 billion in fiscal year 2001. Over the 5-year period, the proportion of USDA’s discretionary resources spent  through contracts increased from 14 percent to about 16 percent. About 70 percent of USDA’s contract  spending went for purchases of goods, while about 30 percent was spent on services.
For contracts valued over $25,000, spending on goods increased by 53 percent from fiscal year 1997 through  fiscal year 2001. This increase was driven by purchases of food-related products and nonmetallic crude  materials, such as cereal grains. Overall, purchases of food accounted for nearly half of USDA’s contract  spending.
Similarly, spending on services increased by 44 percent over the same period, primarily as a result of  increased purchases of services related to natural resources and conservation and property maintenance  and construction.
Since fiscal year 1997, USDA’s spending has increased significantly in the following categories: natural  resources and conservation (152 percent), nonmetallic crude materials (145 percent), construction  (43 percent), and food (40 percent).
USDA spent about $3.7 billion through contracts in fiscal year 2001, with firm fixed-price and other kinds of  fixed-price contracts accounting for about 99 percent of USDA’s contract dollars.
Purchase card spending between fiscal years 1997 and 2001 quadrupled, rising from $140.2 million to  $564.2 million. In fiscal year 2001, USDA authorized the use of 22,865 purchase cards.
Spending on commercial items using FAR part 12 procedures increased by about 93 percent from  fiscal years 1997 through 1999, but decreased by 79 percent from fiscal years 1999 through 2001.  USDA officials indicated that this decrease was a result of USDA reclassifying certain items  as noncommercial.
In fiscal year 2001, 93 percent of USDA’s contracts over $25,000 were competed.
USDA’s total workforce in fiscal year 2001 was slightly higher than its fiscal year 1997 level. Over the same  period, its acquisition workforce decreased by about 6 percent, to about 5,700 personnel.
By fiscal year 2008, 29 percent of USDA’s current acquisition workforce will be eligible to retire.
Purchase Card Oversight: To strengthen its oversight of purchase card transactions, USDA officials  reported that they are:  scanning the USDA Purchase Card Management System database for questionable transactions and  requesting USDA agencies to justify these transactions as appropriate;  issuing revised regulations to tighten card use and oversight procedures—for example, employees who fail  to reconcile their accounts within 60 days will have their cards deactivated; and  forming an interagency working group to define criteria for both automated alerts and preformatted reports  for agency use in identifying questionable transactions.
Performance-Based Service Contracting: USDA is emphasizing the use of performance-based service  contracting procedures by using a monthly “report card,” which is furnished to senior management in each  contracting activity’s headquarters. This report card addresses how well each USDA agency is doing in  meeting established goals. In fiscal year 2002, USDA reported that more than 20 percent of its eligible service  contracts were performance based, exceeding the governmentwide goal.
Integrated Acquisition System: USDA is working to deploy its first corporate procurement automation  system to support electronic requisitioning and contract document generation. The system is expected to  interface with USDA’s corporate financial system and help improve the timeliness and accuracy of USDA’s  financial statements. The system is currently undergoing pilot testing in locations within two USDA agencies.
Workforce: To deal with the potential retirement of a large percentage of its skilled procurement workforce  over the next few years, USDA is developing new regulations addressing classroom training, on-the-job  experience, and education requirements for its acquisition workforce. USDA also recently added information  on training resources and on-line classes to its procurement Web site’s home page.
section_title: V. Key Procurement Reports
paragraphs: Major Management Challenges and Program Risks: Department of Agriculture. GAO-03-96.
Washington, D.C.: January 2003.
section_title: Appendix IV: Department of Energy
subsections: section_title: Agency Overview and Highlights
paragraphs: Mission: To foster a secure and reliable energy system that is environmentally and economically sustainable;  to be a responsible steward of the nation’s nuclear weapons and nuclear materials; to clean up the  department’s facilities; to lead in the physical sciences and advance the biological, environmental, and  computational sciences; and to provide scientific instruments important to the Department of Energy (DOE).
DOE groups its activities into three areas, which together comprised more than 90 percent of its fiscal year  2001 total discretionary budget resources.
National Nuclear Security Administration (NNSA) maintains and enhances the safety, reliability, and  performance of the U.S. nuclear weapons stockpile, including the ability to design, produce, and test  weapons, to meet national security requirements. NNSA also engages in nonproliferation activities and the  operation of Navy reactors. In fiscal year 2001, NNSA accounted for 35 percent of DOE’s discretionary  resources.
Energy Programs include nondefense environmental management, scientific research and development  regarding renewable energy resources and nuclear energy, the remediation and maintenance of uranium  facilities, and nuclear waste disposal. In fiscal year 2001, Energy Programs accounted for 31 percent of  DOE’s discretionary resources.
Environmental and other defense activities include defense-related environmental restoration and  waste management, nuclear waste disposal, facilities closure projects, and environmental management  privatization. In fiscal year 2001, these activities accounted for 29 percent of DOE’s discretionary resources.
DOE’s discretionary resources rose by about 6 percent from fiscal year 1997 through fiscal year 2001 and  totaled $25.5 billion in fiscal year 2001. DOE relies heavily on contracting to support its mission. For example,  during the 5-year period, an average of 73 percent of its discretionary resources were spent on contracts.
In fiscal year 2001, about 98 percent of DOE’s contracts over $25,000 were spent on services, of which three- quarters went to the management and operation of over 30 government-owned laboratories and nuclear  facilities.
DOE’s spending on natural resources and conservation services rose from $331.7 million in fiscal year 1997  to $1.35 billion in fiscal year 2001, a 306 percent increase. This increase was mostly driven by three large  contracts for the cleanup, removal, and disposal of hazardous substances.
DOE ranks as one of the largest agencies in research and development contracting, spending almost  $1.1 billion in fiscal year 2001.
DOE has historically relied on cost-type contracts as its primary contracting vehicle. In fiscal year 2001,  $17.4 billion of the $18.6 billion—or 93 percent—that DOE spent on contracts over $25,000 was spent on  cost-type contracts. Nearly all of DOE’s contracts for managing and operating its laboratories and facilities  were cost-type.
DOE continues to increase the amount awarded under competed contracts. For example, in fiscal year  2001, 64 percent of DOE’s contracts were competed.
The use of purchase cards grew by an average of 12 percent annually from fiscal year 1997 through fiscal  year 2001, and totaled approximately $220 million in fiscal year 2001. In fiscal year 2001, DOE authorized the  use of 6,250 purchase cards.
DOE’s total workforce, as well as its acquisition workforce, remained relatively stable from fiscal year 1997  through fiscal year 2001. In fiscal year 2001, DOE’s total workforce was 15,997, with 1,449, or 9 percent, in the  acquisition workforce.
In fiscal year 2001, 57 percent of the acquisition workforce had 20 years or more of federal service, while  7 percent had fewer than 5 years of federal service.
section_title: IV. Key Procurement Initiatives as Reported by Agency Officials
paragraphs: Contract Management: To address both pre-award and post-award contract administration issues, a  Contract Administration Division was formed to provide guidance and seek out and resolve contract  administration issues. During fiscal year 2002, the division conducted a review of over 50 internal DOE  directives. As a result of this review, a significant number of directives will be revised, canceled, or  consolidated in an effort to be more consistent with performance-based management principles.
Acquisition Career Development Program: To ensure that workforce skills stay current, DOE adopted the  requirement for 80 hours of continuous learning every two years. As of the first quarter of 2002, 88 percent of  the covered workforce met the certification requirements.
Electronic Procurement: To streamline and eliminate redundant processes and develop paperless solutions,  DOE developed DOE/C-Web, a Web-based electronic small purchase system, and the Industry Interactive  Procurement System (IIPS), a Web-based system for large contracts (over $100,000) to issue solicitations,  receive proposals, conduct negotiations, and make awards via the Internet. The systems have allowed DOE to  achieve the following results:  100 percent of all synopses and notices requiring posting in FedBizOpps were posted electronically  through IIPS. The number of solicitations posted on IIPS increased from 88 in fiscal year 1999 to  approximately 900 in fiscal year 2002.
The number of transactions conducted via DOE/C-Web increased from approximately 1,800 in  fiscal year 1998 to 2,743 in fiscal year 2002.
section_title: V. Key Procurement Reports
paragraphs: Department of Energy: Status of Contract and Project Management Reforms. GAO-03-570T. Washington,  D.C.: March 20, 2003.
Major Management Challenges and Program Risks: Department of Energy. GAO-03-100. Washington, D.C.:  January 2003.
Contract Reform: DOE Has Made Progress, but Actions Needed to Ensure Initiatives Have Improved  Results. GAO-02-798. Washington, D.C.: September 13, 2002.
Department of Energy: Contractor Litigation Costs. GAO-02-418R. Washington, D.C.: March 8, 2002.
IG-0538–Management Challenges at the Department of Energy, December 21, 2001.
IG-0510–Use of Performance-Based Incentives at Selected Departmental Sites, July 9, 2001.
IG-0509–Integrated Planning, Accountability, and Budgeting System-Information System, June 28, 2001.
section_title: Appendix V: Department of Health and Human Services
subsections: section_title: Agency Overview and Highlights
paragraphs: Mission: The Department of Health and Human Services (HHS) is the United States government’s principal  agency for protecting the health and welfare of all Americans.
The following bureaus account for the majority of HHS’ fiscal year 2001 discretionary budget resources:  National Institutes of Health (NIH) is responsible for conducting scientific research regarding the nature  and behavior of living systems to extend healthy life and reduce the burdens of illness and disability. In  fiscal year 2001, NIH accounted for 36 percent of HHS’ discretionary resources.
Administration for Children and Families is responsible for promoting the economic and social  well being of families, children, individuals, and communities. In fiscal year 2001, the administration  accounted for 21 percent of HHS’ discretionary resources.
Other key bureaus: Food and Drug Administration, Centers for Medicare and Medicaid Services,  Centers for Disease Control and Prevention, and Indian Health Service.
HHS’ discretionary budget increased by 47 percent from fiscal year 1997 through fiscal year 2001, and totaled  $61 billion in fiscal year 2001. Over the 5-year period, the proportion of HHS’ discretionary resources spent  under contracts decreased slightly, dropping from more than 9 percent in fiscal year 1997 to 8 percent in  fiscal year 2001.
HHS relied heavily on services from fiscal years 1997 through 2001. Although HHS’ spending on goods  increased 127 percent, from $159 million to $360 million during the 5-year period, spending on services  increased 19 percent, from $3.3 billion to $3.9 billion, between fiscal years 1997 and 2001.
HHS spent about $1.1 billion on research and development projects in fiscal year 2001, or about 27 percent  of total contract spending. The amount spent on these projects remained relatively stable during the 5-year  period.
From fiscal years 1997 through 2001, HHS experienced significant spending increases in three categories:  medical, dental, and veterinary equipment (363 percent); professional, administrative, and management  support (123 percent); and IT services (115 percent).
HHS spent about $4.3 billion through contracts over $25,000 in fiscal year 2001. HHS relies on cost-type  contracts as its primary contracting vehicle, accounting for 66 percent of these contract dollars.
Purchase card spending increased by 258 percent over the 5-year period, from $95.2 million in fiscal year  1997 to $341.2 million in fiscal year 2001.
HHS’ significant increase in its use of the federal supply schedule has been driven by purchases of services,  which increased from about $6 million to over $98 million, during the 5-year period.
The total HHS workforce has been increasing, particularly at NIH and the Food and Drug Administration, due  to bio-defense initiatives. This trend is expected to continue, given the current focus on combating the threat  of biological or chemical terrorism.
In fiscal year 2002, more than 80 percent of the acquisition workforce had more than 10 years of federal  service; the majority has 20 years or more of service.
By fiscal year 2008, about 33 percent of the current acquisition workforce will be eligible to retire.
Reverse auctioning: Reverse auctioning is a process that allows many sellers to compete for the business of  a single buyer. However, unlike a traditional auction, bid prices go down. HHS claimed cost savings of more  than $1.3 million from fiscal year 2000 through 2001 using reverse auctioning techniques.
Performance-based service contracting: HHS officials reported significant increases in their use of  performance-based contracting, including contracts with Medicare intermediaries and carriers.
section_title: V. Key Procurement Reports
paragraphs: Major Management Challenges and Program Risks: Department of Health and Human Services.  GAO-03-101. Washington, D.C.: January 2003.
Medicare: Comments on HHS’ Claims Administration Contracting Reform Proposal. GAO-01-1046R.  Washington, D.C.: August 17, 2001.
Medicare Contracting Reform: Opportunities and Challenges in Contracting for Claims Administration  Services. GAO-01-918T. Washington, D.C.: June 28, 2001.
Medicare: Opportunities and Challenges in Contracting for Program Safeguards. GAO-01-616.  Washington, D.C.: May 18, 2001.
Inspector General Report Number A-04-99-05561—-Audit of Medicare Administrative Costs Claimed by  Blue Cross Blue Shield of Florida for Fiscal Years 1995 through 1998, July 31, 2002.
section_title: Appendix VI: Department of Justice
subsections: section_title: Agency Overview and Highlights
paragraphs: Mission: Enforcing laws in the public interest and protecting the public from criminal activity.
The following bureaus account for the majority of the Department of Justice’s (DOJ) fiscal year 2001 total  discretionary budget resources:  Office of Justice Programs develops programs that improve law enforcement’s ability to prevent and  control crime, improve the criminal and juvenile justice systems, increase knowledge about crime and  related issues, and assist crime victims. In fiscal year 2001, the office accounted for 24 percent of DOJ’s  discretionary resources.
Federal Bureau of Prisons seeks to provide safe, efficient, and humane correctional services and  programs. In fiscal year 2001, the bureau accounted for 18 percent of DOJ’s discretionary resources.
Federal Bureau of Investigation (FBI) conducts investigations and enforces federal laws. In fiscal year  2001, the FBI accounted for 16 percent of DOJ’s discretionary resources.
Other key bureaus: Immigration and Naturalization Service, Drug Enforcement Administration, and the  DOJ’s discretionary resources increased 16 percent from fiscal year 1997 through fiscal year 2001 and totaled  $26.4 billion in fiscal year 2001. Over the 5-year period, the proportion of DOJ’s discretionary resources spent  under contracts increased slightly, rising from 15 percent in fiscal year 1997 to 17 percent in fiscal year 2001.
For contracts valued over $25,000, spending on services increased 64 percent from fiscal year 1997 through  fiscal year 2001. This growth was driven by increases in the following services: professional, administrative  and management support services (128 percent); building construction (125 percent); information  technology services (64 percent).
DOJ spent about $3.9 billion on contracts over $25,000 in fiscal year 2001. DOJ relied on firm fixed-price and  other kinds of fixed-price contracts as the agency’s primary contracting vehicles. On average from fiscal year  1997 through fiscal year 2001, fixed-price contracts accounted for 85 percent of DOJ’s contract dollars.
DOJ’s use of the federal supply schedule and contracts awarded by other agencies increased considerably  during the 5-year period. For example, DOJ spent $234 million in fiscal year 1997 using the federal supply  schedule; in fiscal year 2001, it had spent $470 million.
Purchase card spending increased by 179 percent over the 5-year period, from $190.9 million in  fiscal year 1997 to $533.4 million in fiscal year 2001. In fiscal year 2001, DOJ authorized the use of  16,073 purchase cards.
DOJ’s use of FAR part 12 to purchase commercial items grew more than 400 percent over the last 5 years.
This increase was due to DOJ’s increased emphasis on (1) commercial purchases, and (2) more accurate  reporting of data to FPDS.
Workforce  From fiscal year 1997 through fiscal year 2001, DOJ’s total workforce increased by 11 percent—growing  from about 110,000 to 123,000. However, DOJ’s acquisition workforce remained relatively stable, decreasing  2 percent over the 5-year period.
In fiscal year 2002, more than 85 percent of the acquisition workforce had 10 years or more of   By fiscal year 2008, about 30 percent of the current acquisition workforce will be eligible to retire.
section_title: IV. Key Procurement Initiatives as Reported by Agency Officials
paragraphs: Acquisition-related electronic government initiatives: Since October 2000, DOJ has implemented several  e-government programs to improve its procurement processes. These programs include:  Federal Business Opportunities, which is a GSA-managed Web-based system that provides for electronic  notice of agency requirements and solicitations for contract opportunities. This system has been deployed  departmentwide, and all DOJ synopses for contracts over $25,000 are now posted to that site.
Central Contractor Registration is a Web-based governmentwide database of vendor information.
DOJ is the administrator for two programs used to track contractor performance:  Contractor Past Performance System: an electronic federal report card collection system that is used to  collect and record past performance information for subsequent use in determining contractor eligibility  and selection.
Past Performance Information Retrieval System: A Web-enabled application that allows the retrieval  of contractor past performance information from various databases.
Departmentwide guidelines for evaluating candidates for GS-1102 contract specialist  positions: Over the last 5 years, guidelines were issued to bureau personnel officers for evaluating candidates  for GS-1102 contract specialist positions. Key elements include new education standards and certification  processes.
section_title: V. Key Procurement Reports
paragraphs: Major Management Challenges and Program Risks: Department of Justice. GAO-03-105. Washington, D.C.:  January 2003.
Information Technology: INS Needs to Strengthen Its Investment Management Capability. GAO-01-146.  Washington, D.C.: December 29, 2000.
Border Patrol: Procurement of MD 600N Helicopters Should Be Reassessed. GGD-00-201. Washington, D.C.:  September 29, 2000.
Report Number 02-32–Federal Bureau of Prisons Management of Construction Contracts, August 2002.
Report Number 01-16–Justice’s Reliance on Private Contractors for Prison Services, July 31, 2002.
section_title: Appendix VII: Department of the Treasury
subsections: section_title: Agency Overview and Highlights
paragraphs: Mission: To promote a stable economy, manage the government’s finances, and safeguard federal financial  systems and our nation’s leaders.
The following bureaus account for the majority of Treasury’s fiscal year 2001 total discretionary  budget resources:  Internal Revenue Service (IRS)—responsible for determining, assessing, and collecting tax revenue in  the United States. In fiscal year 2001, the IRS accounted for 51 percent of Treasury’s total discretionary  budget resources.
U.S. Customs Service—responsible for enforcing laws to safeguard U.S. borders against the illegal entry  of goods and of regulating legitimate commercial activity. In fiscal year 2001, Customs accounted for  20 percent of Treasury’s total discretionary budget resources.
Other key bureaus—the U.S. Mint, the Secret Service, and the Bureau of Alcohol, Tobacco, and Firearms.
Treasury’s total discretionary budget resources increased by 32 percent from fiscal year 1997 through  fiscal year 2001 and totaled $19.7 billion in fiscal year 2001. Over the same period, the amount spent  through contracts increased slightly, both in real terms and as a share of Treasury’s discretionary resources.  For example, in fiscal year 1997, contract obligations accounted for about 14 percent of Treasury’s  discretionary resources; by fiscal year 2001, contract obligations accounted for 17 percent.
For contracts valued over $25,000, spending on services increased by 71 percent from fiscal year 1997  through fiscal year 2001, while spending on goods increased by 44 percent. Treasury’s spending on goods  increased significantly during fiscal year 1999; this was attributed to (1) the U.S. Mint’s development of the  “state quarters” program, (2) the Secret Service’s upgrade in hand weapons, and (3) preparation for  Y2K-related incidents.
Since fiscal year 1997, Treasury experienced significant spending increases in four categories: information  technology (IT) equipment (181 percent), communication detection equipment (144 percent),  administrative and management support services (138 percent), and IT services (81 percent).
Treasury has changed its procurement approach in several key areas since fiscal year 1997:  Treasury’s use of contracts awarded or administered by other agencies has doubled over this period and  accounted for about 16 percent of Treasury’s contract obligations in fiscal year 2001.
After increasing by about 53 percent from fiscal years 1997 through 1999, purchase card use  remained relatively stable through fiscal year 2001. In fiscal year 2001, Treasury authorized the use of  16,558 purchase cards.
Treasury’s workforce size has remained relatively stable over the 5-year period. Between fiscal years 1997  through 2001, Treasury’s total workforce grew about 2 percent from about 156,000 employees to almost  159,000. Treasury’s acquisition workforce represents about 1.5 percent of its total workforce.
In fiscal year 2001, 47 percent of the acquisition workforce had 20 years or more of federal service, while  only 4 percent of the workforce had fewer than 5 years of service.
By fiscal year 2008, approximately 30 percent of Treasury’s acquisition workforce will be eligible to retire.
Performance-based Service Contracting (PBSC): To increase its use of PBSC methods, Treasury  developed PBSC training and a handbook, presented information on PBSC to all bureaus, and worked with  bureaus on individual procurements. Procurement officials at Treasury stated that these efforts resulted in  increasing Treasury’s use of performance-based contracts to 20 percent in fiscal year 2002.
Improving procurement system reviews: Treasury developed the Acquisition Management Assistance  Review program to assess three key areas (people, process, and tools) to determine the health of Treasury’s  procurement systems.
Procurement Intern Program: Because its acquisition workforce is aging, Treasury developed a  procurement intern program to identify and develop new talent for the bureaus.
section_title: V. Key Procurement Reports
paragraphs: Major Management Challenges and Program Risks: Department of the Treasury. GAO-03-109.  Washington, D.C.: January 2003.
Acquisition Workforce: Status of Agency Efforts to Address Future Needs. GAO-03-55. Washington, D.C.:  December 18, 2002.
IRS Contracting: New Procedure Adds Price or Cost as a Selection Factor for Task Order  Awards. GAO-03-218. Washington, D.C.: December 10, 2002.
Business Systems Modernization: IRS Needs to Better Balance Management Capacity with System  Acquisition Workload. GAO-02-356. Washington, D.C.: February 28, 2002.
OIG-02-074—General Management: The Mint Leased Excessive Space For Its Headquarters Operation,  March 29, 2002.
section_title: Appendix VIII: Department of Transportation
subsections: section_title: Agency Overview and Highlights
paragraphs: Mission: To ensure a fast, safe, efficient, accessible, and convenient transportation system that meets our  vital national interests and enhances the quality of life of the American people, today and into the future.
Two administrations account for the majority of the Department of Transportation’s (DOT) fiscal year 2001  total discretionary budget resources:  The Federal Aviation Administration (FAA) regulates civil aviation to promote safety and fulfill the  requirements of national defense; encourages and develops civil aeronautics, including new aviation  technology; operates a common system of air traffic control and navigation for both civil and military  aircraft; implements programs to control aircraft noise and other environmental effects of civil aviation; and  regulates U.S. commercial space transportation. In fiscal year 2001, the FAA accounted for 41 percent of  DOT’s total discretionary budget resources.
The United States Coast Guard (USCG) is responsible for maritime search and rescue, recreational  boating safety, vessel traffic management, at-sea enforcement of living marine resource laws and treaty  obligations, at-sea drug and illegal migrant interdiction, and port security. In fiscal year 2001, the USCG  accounted for 15 percent of DOT’s total discretionary budget resources.
Other key organizations: Federal Transit Administration and Federal Highway Administration.
DOT’s discretionary resources decreased 28 percent from $51.8 billion in fiscal year 1997 to $37.3 billion in  fiscal year 2001. This was due largely to changes brought about by the Transportation Equity Act for the  21st Century (TEA-21). TEA-21, which was enacted in June 1998, shifted a significant amount of discretionary  funds to mandatory spending categories. While discretionary resources decreased during the 5-year period,  the amount spent through contracts increased by 26 percent. In fiscal year 2001, the DOT spent almost  $5.6 billion, or 15 percent of its discretionary resources, through contracting.
Spending on goods decreased by 29 percent from fiscal year 1997 to fiscal year 2001, while spending on  services increased 49 percent. In fiscal year 2001, 85 percent of the amount spent through contracts over  $25,000 was for services.
DOT relies on a mix of contract types to achieve its mission; slightly more than half of DOT’s fiscal year 2001  contracts were fixed-price, while more than a quarter were cost-type. Another 14 percent were labor hours or  time and materials contracts.
In fiscal year 2001, 19 percent of DOT’s service contracts were performance based.
In fiscal year 2001, DOT authorized the use of 21,728 purchase cards.
The amount spent using FAR part 12 procedures increased from $297 million in fiscal year 1997 to  $1.6 billion in fiscal year 2001, a 437 percent increase.
In fiscal year 2001, DOT’s total workforce was 64,509, a 2 percent increase from fiscal year 1997. About  2 percent of the total workforce was made up of the acquisition workforce, which decreased by 7 percent  during the 5-year period, from 1,634 in fiscal year 1997 to 1,514 in fiscal year 2001.
In fiscal year 2001, 56 percent of the acquisition workforce had 20 years or more of federal service, while  5 percent had fewer than 5 years of service.
By fiscal year 2008, approximately 36 percent of DOT’s acquisition workforce will be eligible to retire.
Security: To support the current security crisis within our country after September 11, 2001, DOT: (1) helped  stand up the Transportation Security Administration (TSA) by assisting in creating a TSA Acquisition  Management System, developing a standard set of TSA contract provisions and clauses, and providing  operational support in the solicitation and award of TSA contracts; and (2) continues to address security  issues relating to controlling access to sensitive information and background checks on contractor personnel  in positions where sensitive information or national security interests are present.
Procurement Performance Management System: DOT continues its major initiative to improve  procurement performance by implementing DOT’s procurement performance management program.  This program assists managers in targeting areas for improvement based on the results of specified  metrics chosen for their importance to the administration, DOT management, or DOT customers.
section_title: V. Key Procurement Reports
paragraphs: Major Management Challenges and Program Risks: Department of Transportation. GAO-03-108.  Washington, D.C.: January 2003.
National Airspace System: Status of FAA’s Standard Terminal Automation Replacement System.  GAO-02-1071. Washington, D.C.: September 17, 2002.
National Airspace System: FAA’s Approach to Its New Communications System Appears Prudent, but  Challenges Remain. GAO-02-710. Washington, D.C.: July 15, 2002.
FAA Alaska: Weak Controls Resulted in Improper and Wasteful Purchases. GAO-02-606. Washington, D.C.:  May 30, 2002.
Coast Guard: Budget and Management Challenges for 2003 and Beyond. GAO-02-538T. Washington, D.C.:  March 19, 2002.
Coast Guard: Progress Being Made on Deepwater Project, but Risks Remain. GAO-01-564. Washington, D.C.:  May 2, 2001.
National Airspace System: Persistent Problems in FAA’s New Navigation System Highlight Need for  Periodic Re-evaluation. GAO/RCED/AIMD-00-130. Washington, D.C.: June 12, 2000.
FI-2002-092–FAA Oversight of Cost Reimbursable Contracts, May 8, 2002.
FI-2002-089–DOT’s Information Technology Omnibus Procurement Program (ITOP), April 15, 2002.
FI-2001-057–FRA E-Mail System Replacement Contracts, May 3, 2001.
FI-2000-125–Inactive Obligations on Contracts, September 25, 2000.
AV-2000-127–Technical Support Services Contract: Better Management Oversight and Sound Business  Practices Are Needed, September 28, 2000.
section_title: Appendix IX: Department of Veterans Affairs
subsections: section_title: Agency Overview and Highlights
paragraphs: Mission: To restore the capability of those who suffered harm during their military service; to ensure a  smooth transition as veterans return to civilian life in their communities; to honor and serve all veterans for  the sacrifices they made on behalf of the nation; to contribute to the public health, socioeconomic well being,  and history of the nation.
The following administrations account for nearly all of the Department of Veterans Affairs’ (VA) fiscal year  2001 total discretionary budget resources.
Veterans Health Administration is responsible for medical care, education, and research, and serves as  medical backup to the Department of Defense. In fiscal year 2001, VHA accounted for 89 percent of VA’s  discretionary resources.
Veterans Benefits Administration provides benefits and services to veterans and their dependents,  including compensation and pensions, education benefits, loan guarantees, and insurance.
National Cemetery Administration provides burial benefits to veterans and eligible dependents and  Presidential Memorial Certificates to deceased veterans’ next of kin.
VA’s discretionary resources rose by about 20 percent from fiscal years 1997 through fiscal year 2001 and  totaled $26.5 billion in fiscal year 2001. In fiscal year 2001, contract obligations accounted for 22 percent, or  $5.9 billion, of VA’s discretionary resources.
VA spends almost half of its contract dollars on medical and dental equipment and supplies. Since  fiscal year 1997, spending for these supplies has grown by 92 percent due in large part to an increase in  patient workload.
Spending on services grew by about 14 percent, largely driven by increased spending for information  technology (226 percent) and medical services (24 percent).
VA relies heavily on firm fixed-price contracts. In fiscal year 2001, $3.9 billion—or 91 percent—of the  $4.3 billion that VA obligated for contracts over $25,000 was obligated on firm fixed-price contracts.
Purchase card spending increased from $855 million in fiscal year 1997 to $3.8 billion in fiscal year 2001,  a 344 percent increase. In fiscal year 2001, VA authorized the use of 34,090 purchase cards.
VA spent $3.4 billion, 79 percent of total contracting dollars, on competed contracts in fiscal year 2001. VA  typically received two or more offers on more than 90 percent of its competed contracts.
At 202,414 personnel in fiscal year 2001, VA’s total workforce was about the same level as fiscal year 1997. VA’s  acquisition workforce decreased by 6 percent from its fiscal year 1997 level and totaled about 2,562 personnel  in fiscal year 2001.
In fiscal year 2001, 52 percent of the acquisition workforce had 20 years or more of federal service, while  5 percent had fewer than 5 years of federal service.
Computer, hardware and software procurement: VA requires that computer hardware and software  vendors offer products to VA at a cost equal to or lower than those offered any other customers. Prices that are  found to be too high are required to be lowered before they are accepted. According to VA officials, this  initiative resulted in savings of $33 million in the period of June through October 2002. The prices paid by VA  over this time period average 21.6 percent below the vendors’ GSA Federal Supply Schedule prices for the  same items.
Vocational rehabilitation and employment service national acquisition strategy: To address concerns  related to contracting for services in the field, a task force developed the National Acquisition Strategy to  provide uniform prices and services at the 58 Veterans Benefit Administration regional offices. In September  2002 VA awarded 249 performance-based service contracts using a uniform format. According to VA officials,  over 95 percent of the awards went to small businesses, veteran-owned businesses, and service-disabled,  veteran-owned businesses.
Joint contracting between VA and DOD: In March 2001 VA had 34 joint contracts for pharmaceuticals  between VA and DOD. In November 2002, that number more than doubled, to 76. In addition, there are  18 pending joint contracts for pharmaceuticals, vital sign monitors, and radiation therapy equipment.
VA Federal Supply Schedule Program: The VA Federal Supply Schedule Program was expanded in late  2000, to include professional health care services. This schedule is open to all federal agencies and provides  for temporary contract services of surgeons, specialists, nurses, radiologists, pharmacists, and dentists.  Recently, allied health services (nursing assistants, pharmacy technicians, and dental assistants) were added  to this schedule.
section_title: V. Key Procurement Reports
paragraphs: Major Management Challenges and Program Risks: Department of Veterans Affairs. GAO-03-110.  Washington, D.C.: January 2003.
VA and DOD Health Care: Factors Contributing to Reduced Pharmacy Costs and Continuing Challenges.  GAO-02-969T. Washington, D.C.: July 22, 2002.
VA and Defense Health Care: Potential Exists for Savings through Joint Purchasing of Medical and  Surgical Supplies. GAO-02-872T. Washington, D.C.: June 26, 2002.
DOD and VA Pharmacy: Progress and Remaining Challenges in Jointly Buying and Mailing Out Drugs.  GAO-01-588. Washington, D.C.: May 25, 2001.
VA Laundry Service: Consolidations and Competitive Sourcing Could Save Millions. GAO-01-61.  Washington, D.C.: November 30, 2000. 01-00504-9–Summary Report–Combined Assessment Program Reviews at Veterans Health Administration  Medical Facilities (January 1999–March 2001), October 10, 2001. 01-01855-75–Evaluation of the Department of Veterans Affairs Purchasing Practices, May 15, 2001. 9R3-E99-037–Audit Of The Department Of Veterans Affairs Purchase Card Program, February 12, 1999. 8D2-E01-002–Audit of VA Procurement Initiatives For Computer Hardware, Software, and Services  (PCHS/PAIRS) and Selected Information Technology Investments, January 22, 1998.
section_title: Appendix X: General Services Administration
subsections: section_title: Agency Overview and Highlights
paragraphs: Mission: To provide policy leadership and expertly managed space, products, services, and solutions, at the  best value, to enable federal agencies to accomplish their missions.
The following services account for the majority of the General Services Administration’s (GSA) fiscal year  2001 total discretionary budget resources.
Federal Technology Service (FTS) provides information technology solutions and network services to  support federal agencies. In fiscal year 2001, FTS accounted for 46 percent of GSA’s total discretionary  budget resources.
The Public Building Service (PBS) oversees the construction, development, and maintenance of federal  buildings and manages the leasing of commercial office space. In fiscal year 2001, PBS accounted for  51 percent of GSA’s total discretionary budget resources.
Federal Supply Service (FSS) provides agencies with numerous supplies and services, including  commercial products, professional services, vehicle acquisition and leasing, and travel and transportation  services. FSS manages the Federal Supply Schedule program, which provides federal agencies with access  to more than 4 million products and services and coordinates the governmentwide travel and purchase card  programs. The FSS accounts for none of GSA’s discretionary resources, because the service is financed by a  revolving fund. With a revolving fund, the FSS obtains most of its funding from the fees paid by other  agencies to buy from the FSS program.
GSA’s discretionary resources increased by 38 percent from fiscal year 1997 through fiscal year 2001 and  totaled $19.3 billion in fiscal year 2001. Over the 5-year period, the proportion of GSA’s discretionary resources  spent under contracts increased from 59 percent to about 64 percent. GSA relies heavily on service contracts,  which accounted for more than 80 percent of all contracts over $25,000 in fiscal year 2001.
For contracts valued over $25,000, spending on services increased by 75 percent from fiscal year 1997  through fiscal year 2001. Spending on goods increased by 13 percent.
The increase in service spending was driven by increased purchases of IT services, which grew from  $594.0 million in fiscal year 1997 to $4.7 billion in fiscal year 2001. GSA’s increased share is largely  attributable to the growth of GSA’s Federal Technology Service. However, orders placed by the Federal  Technology Service are counted as spending by GSA, rather than spending by the federal agency that will  ultimately receive the service or equipment.
Since fiscal year 1997, GSA’s spending has undergone significant increases in the following categories:  IT and telecommunication services (691 percent), motor vehicles (24 percent), IT equipment (19 percent),  and lease of facilities (17 percent).
GSA spent about $11.7 billion through contracts in fiscal year 2001, with firm fixed-price and other kinds of  fixed-price contracts accounting for over 90 percent of GSA’s contract dollars.
Purchase card spending doubled since fiscal year 1997, and totaled nearly $160 million in fiscal year 2001. In  fiscal year 2001, GSA authorized the use of 3,776 purchase cards.
GSA’s total workforce has remained relatively stable over the 5-year period, at about 14,100. Over this same  period, its acquisition workforce has increased by more than 10 percent.
More than 91 percent of GSA’s acquisition workforce has more than 10 years of federal service; by fiscal  year 2008, 34 percent will be eligible to retire.
Construction Brain Trust. The Construction Brain Trust was implemented in fiscal year 2001 to reduce  the time, cost and complexity of the construction contracting process. The membership consists of  representatives from GSA policy offices, GSA regions, and construction-related associations, surety  companies, and law firms.
Agency-wide performance-based contracting program. To improve GSA’s use of performance-based  contracts, it established a Web site and developed additional training materials, such as the Seven Steps to  Performance-based Service Acquisition Guide, for use by its acquisition personnel.
Applied Learning Center. This initiative was implemented in 2001. The long-term goal of the center is to  assist acquisition professionals perform their jobs, identify skill gaps, and broaden the knowledge base of  acquisition professionals into areas such as budget, finance, and program management.
section_title: V. Key Procurement Reports
paragraphs: Contract Management: Government Faces Challenges in Gathering Socioeconomic Data on Purchase Card  Merchants. GAO-03-56. Washington, D.C.: December 13, 2002.
Acquisition Workforce: Status of Agency Efforts to Address Future Needs. GAO-03-55. Washington, D.C.:  December 18, 2002.
Acquisition Workforce: Agencies Need to Better Define and Track the Training of Their Employees.  GAO-02-737. Washington, D.C.: July 29, 2002.
Contract Management: Interagency Contract Program Fees Need More Oversight. GAO-02-734.  Washington, D.C.: July 25, 2002.
Contract Management: Roles and Responsibilities of the Federal Supply Service and Federal Technology  Service. GAO-02-821R. Washington, D.C.: June 7, 2002.
Telecommunications: GSA Action Needed to Realize Benefits of Metropolitan Area Acquisition Program.  GAO-02-325. Washington, D.C.: April 4, 2002.
Contract Management: Not Following Procedures Undermines Best Pricing Under GSA’s Schedule.  GAO-01-125. Washington, D.C.: November 28, 2000.
Special Report on FSS’s Multiple Award Schedule Pricing Practices, August 24, 2001.
Report Number A995288–Audit of Federal Technology Service’s Use of Multiple Award Indefinite Delivery  Indefinite Quantity Contracts, September 19, 2000.
Report Number A995175–Audit of the Federal Protective Service’s Contract Guard Program, March 28, 2000.
section_title: Appendix XI: National Aeronautics and Space Administration
subsections: section_title: Agency Overview and Highlights
paragraphs: Mission: To develop human exploration of space, advance and communicate scientific knowledge, and  research and develop aeronautics and space technologies.
Two accounts account for the majority of the National Aeronautics and Space Administration’s (NASA) fiscal  year 2001 total discretionary budget resources:  Science, Aeronautics and Technology (SAT) provides funds for research and development in the offices  of Space Science, Earth Science, Biological and Physical Research, and Aerospace Technology, respectively.  SAT also funds academic programs that NASA has established in elementary and secondary schools, as well  as research conducted at more than 100 universities in the United States. In fiscal year 2001, SAT accounted  for 44 percent of NASA’s discretionary resources.
Human Space Flight (HSF) primarily provides funds for the construction and operation of the  international space station and the operation of the space shuttle program. Other programs include  developing expendable launch vehicles, improving space communications and data systems, and providing  safety and mission support. HSF also provides for the design, repair, rehabilitation, and modification of  facilities and construction of new facilities. In fiscal year 2001, HSF accounted for 45 percent of NASA’s  discretionary resources.
NASA’s discretionary resources decreased by about 6 percent from fiscal year 1997 through fiscal year 2001,  totaling $15.8 billion in fiscal year 2001. The amount spent through contracts decreased slightly, both in real  terms and as a share of NASA’s discretionary resources. Nevertheless, NASA relies on contracts to achieve its  mission to a greater extent than most federal agencies.
NASA contracts primarily for services. Of NASA’s $11 billion spent on contracts over $25,000 in fiscal year  2001, about $9.6 billion—or 86 percent—were for services, including operating various government-owned  facilities, providing professional and administrative support, and conducting research and development  activities. Overall, NASA’s spending for services declined by 7 percent between fiscal years 1997 and 2001,  though there were significant variations in individual service categories.
NASA uses a variety of methods in carrying out its procurement functions.
Due to the nature of the items and services needed to carry out its mission, NASA relies heavily on  cost-type contracts; 83 percent of contract obligations over $25,000 for fiscal year 2001 were made  under cost-type contracts.
NASA spent slightly more than half of its contracts over $25,000 on competed contracts, a relatively lower  percentage than other federal agencies. For those contracts it competes, NASA receives two or more bids  nearly 90 percent of the time.
NASA reports that 64 percent of eligible service contracts were performance based in fiscal year 2001.
NASA’s use of purchase cards grew since fiscal year 1997, but accounts for a small percentage of its budget   While NASA generally acquires government-unique items, it increased its purchases using FAR part 12  procedures from $225 million in fiscal year 1997 to about $794 million in fiscal year 2001.
The size of NASA’s workforce remained relatively stable from fiscal year 1997 through fiscal year 2001,  decreasing by about 4 percent. NASA’s acquisition workforce, which represented about 7 percent of its total  workforce, experienced a similar trend.
In fiscal year 2001, 56 percent of the acquisition workforce had 20 years or more of federal service, while  only 3 percent had fewer than 5 years of service.
By fiscal year 2008, approximately 33 percent of NASA’s acquisition workforce will be eligible to retire.
Risk-based acquisition management: To reduce the incidence and severity of impacts arising from  unforeseen programmatic events, NASA recently developed this process to integrate risk principles when  developing the acquisition strategy, selecting sources, choosing contract type, structuring fee incentives, and  conducting contractor surveillance.
Award term contracting: NASA is using this approach to reward contractor performance by enabling  contract extension for excellent performance and reduced costs. In addition to profit, a continuing  relationship becomes a prime motivator for the contractor.
Evaluate and Improve Performance-Based Service Contracting: NASA has initiated an  agencywide awareness program and training sessions for government and contractor employees relating  to performance-based service contracting.
section_title: V. Key Procurement Reports
paragraphs: Major Management Challenges and Program Risks: National Aeronautics and Space Administration.  GAO-03-114. Washington, D.C.: January 2003.
Space Station: Actions Under Way to Manage Cost, but Significant Challenges Remain. GAO-02-735.  Washington, D.C.: July 17, 2002.
NASA: Compliance With Cost Limits Cannot Be Verified. GAO-02-504R. Washington, D.C.: April 10, 2002.
IG-03-003–NASA Contracts for Professional, Administrative, and Management Support Services,  October 16, 2002.
IG-02-027–NASA’s Contract Audit Follow-up System, September 30, 2002.
IG-02-011–Review of Performance-Based Service Contract Quality Assurance Surveillance Plans,  June 24, 2002.
IG-02-011–International Space Station Spare Parts Costs, March 22, 2002.
IG-02-002–Restructuring of the International Space Station Contract, November 8, 2001.
IG-01-027–Acquisition of the Space Station Propulsion Module, May 21, 2001.
section_title: Order by Mail or Phone