Multiple Award Schedule Purchases:

Improvements Needed Regarding Publicizing Agencies' Orders

NSIAD-92-88: Published: May 12, 1992. Publicly Released: Jul 21, 1992.

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Pursuant to a congressional request, GAO reviewed a random sample of 101 Multiple Award Schedule orders exceeding $25,000 for federal information processing resources at six selected procurement offices, focusing on whether the procurement offices complied with statutory and regulatory procurement requirements.

GAO found that: (1) although the agencies generally complied with the Federal Information Resources Management Regulation (FIRMR) requirement to place notices in the Commerce Business Daily (CBD) regarding proposed Information Resources Management Service (IRMS) schedule orders expected to exceed $50,000, they did not synopsize orders with expected values of $25,001 to $50,000, as required by statute; (2) of the 101 sample orders valued at more than $25,000, 36 had synopses published in CBD prior to award; (3) procurement offices' CBD notices were often unnecessarily restrictive of competition; (4) 13 of the 27 notices did not describe the essential characteristics of the agency's federal information processing requirements so that suppliers of alternative products would know what would be acceptable to the agency; (5) 12 of the remaining 14 notices did not cite the applicable reason for limiting competition although the contract file documentation provided a justification for other than full and open competition; (6) most of the 36 notices generated few or no responses from suppliers, and when suppliers did respond they generally offered non-schedule prices for the products; (7) in all 36 cases, the procurement offices purchased the manufacturer's product identified in the notice and in only one of those cases did the orders go to a supplier other than the one identified; and (8) in 6 of the 12 notices with responses, suppliers offered commercial open-market prices for federal information processing items that were lower than the IRMS contract order prices, but agencies did not issue solicitations in any of those cases, due to the relatively high administrative cost of trying to acquire the items on the open market.

Matters for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: GSA is conducting a 2-year pilot of innovative contracting and ordering approaches under the Multiple Award Schedule program for information technology products and services. As part of this effort, changes in CBD synopsis requirements including dollar thresholds and response time are being piloted and evaluated.

    Matter: Congress may wish to consider directing the Administrator of General Services, in consultation with the Administrator for Federal Procurement Policy and those responsible for the procurement policy in other major procurement agencies, such as the Department of Defense and the National Aeronautics and Space Administration, to address, as part of that proposal, the appropriate: (1) dollar threshold for synopsizing in CBD proposed orders against IRMS schedule contracts; and (2) minimum time that should be given to suppliers to respond to such synopses.

  2. Status: Closed - Not Implemented

    Comments: GSA is currently "reinventing" its information technology Multiple Award Schedule program in an effort to streamline and improve government acquisition of computers, telecommunications equipment, and related products and services. Changes to existing MAS ordering processes are being piloted under the reinvention program to reduce time and administrative burdens that currently exist.

    Matter: Congress may wish to consider directing the Administrator of General Services, in consultation with the Administrator for Federal Procurement Policy and those responsible for the procurement policy in other major procurement agencies, such as the Department of Defense and the National Aeronautics and Space Administration, to develop a legislative proposal for streamlining the existing solicitation, selection, and related requirements and processes pertaining to agencies' proposed procurements under IRMS schedule contracts for which lower open-market price offerings are received. The proposal should be designed to: (1) minimize agencies' administrative costs associated with such open-market acquisitions; and (2) better enable agencies to satisfy their needs at the lowest overall cost.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: GSA is in the process of streamlining and automating its contracting and ordering procedures for the Multiple Award Schedule program. FAR and FIRMR requirements are being revised as part of this process. Therefore, there is little or no value in seeking compliance with procedures that soon will be inapplicable.

    Recommendation: The Administrator of General Services should take action to ensure that the heads of major procurement agencies enforce compliance by their procurement offices with existing FAR and FIRMR requirements that: (1) CBD notices of intent to order against IRMS schedule contracts include product descriptions that are not unnecessarily restrictive of competition; (2) procurements based on CBD notices of intent to order against IRMS schedule contracts, if limited to specific make and model products, be justified, certified, and approved in accordance with FAR 6.3; and (3) contract file documentation include the results of CBD synopsis and an analysis showing that the lowest overall cost alternative to satisfy the agency's needs was selected.

    Agency Affected: General Services Administration

  2. Status: Closed - Not Implemented

    Comments: As part of its Multiple Award Schedule Reinvention Pilot Program, GSA is placing increased emphasis on using and enhancing electronic bulletin boards and schedules which contain all technical and pricing information for schedule products and services. Government buyers can quickly and easily enter technical specifications to narrow the competitive range and sellers can easily make changes to pricing structures to reflect dynamics of the workplace. This application of electronic schedules and movement to electronic commerce makes the existing FIRMR and CBD notice requirements in this area obsolete.

    Recommendation: The Administrator of General Services should revise FIRMR to require procurement offices to supplement, in CBD synopsis notices for proposed IRMS schedule orders not required to be justified based on FAR 6.3, any reference to the specific make and model intended to be ordered or maintained with: (1) the words "or equal" or the equivalent; and (2) a listing or description of the essential characteristics of the agency's federal information processing requirement, so that potential sources offering other manufacturers' products can determine what would be acceptable to the government. However, if the government has determined that its federal information processing requirement can be satisfied only by the make and model product identified in the notice, then instead, the notice should be required to indicate the reason justifying the use of other than full and open competition.

    Agency Affected: General Services Administration

  3. Status: Closed - Not Implemented

    Comments: The Federal Streamlining Act of 1994 replaces current law which requires notice of all contracting opportunities above $25,000 to be published in the Commerce Business Daily at least 15 days before a solicitation is issued. Under the conference agreement, as soon as an agency achieves the capability of providing notice of solicitations and receiving responses via electronic commerce procedures it can issue solicitations without prepublication in the CBD.

    Recommendation: The Administrator of General Services should revise FIRMR to require, consistent with statutory requirements and the Federal Acquisition Regulation (FAR), that federal agencies synopsize in CBD proposed orders exceeding $25,000 against IRMS schedule contracts at least 30 days before order placement, unless and until statutory authority for a higher dollar threshold, shorter time frame, or both is obtained.

    Agency Affected: General Services Administration

  4. Status: Closed - Not Implemented

    Comments: GSA is in the process of "reinventing" its Multiple Award Schedule program. Initiatives under way include revising FIRMR regulations applicable to the schedules program to simplify, streamline, and automate them for easy access and retrieval. GSA plans to provide guidance on the use of electronic schedules as pilot program initiatives are completed.

    Recommendation: The Administrator of General Services should revise FIRMR to provided procurement offices with guidance on how to: (1) identify and quantify the costs associated with developing solicitations and fulfilling proposed IRMS schedule requirements through the open market; (2) use this information in evaluating responses to CBD notices relating to such orders; and (3) document in procurement files the results of CBD notice and an analysis indicating selection of the lowest overall cost alternative meeting the agency's needs.

    Agency Affected: General Services Administration

 

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