Davis seeks further reforms

Davis's committee

Rep. Tom Davis (R-Va.) plans to introduce legislation in the coming weeks that would bring procurement laws in line with the government's shift from buying products to buying services.

The soon-to-be-introduced bill, called the Services Acquisition Reform Act (SARA), would create agency chief procurement officer positions, emphasize procurement training by setting aside funding for that purpose and encourage innovative procurement mechanisms such as share-in-savings contracts, in which contractors receive less money upfront in exchange for some of the savings generated by their services.

The proposals are not revolutionary, but they take the procurement reforms enacted in the early 1990s to their next logical step, according to Steve Kelman, former administrator of the Office of Federal Procurement Policy during the Clinton administration and now a professor of public management at Harvard University's John F. Kennedy School of Government.

Government procurement laws have traditionally focused on products, said Larry Allen, executive director of the Coalition for Government Procurement, a Washington, D.C., industry group. However, the government is increasingly buying services, and although procurement laws have been jury-rigged to apply to services, Davis' bill seeks to address this in a more formal manner, Allen said. According to Davis, spending on services has been rising steadily since the early 1980s, but agencies need to do a better job of buying those services so the government gets the best value for its dollars.

SARA could be formally introduced as early as this week. In the meantime, Davis previewed the bill before vendors at both the Government Electronics and Information Technology Association's annual Vision Conference and at the Coalition for Government Procurement's fall conference.

The bill seeks to help procurement officers enhance their skills by setting aside 5 percent of the fees from governmentwide acquisition contracts to pay for training.

"Training has been a huge problem," Davis said, and he hopes better access will improve the government management of large IT projects, which have a high failure rate.

The bill would also allow agencies to use innovative procurement alternatives such as share-in-savings contracts. Such contracts are ostensibly permitted under the Clinger-Cohen Act, but SARA would make their use more explicit and would emphasize the importance of past performance as a criterion for awarding contracts to vendors, he said.

The act would also create a specific preference for performance-based contracts and would exempt IT contracts from certain government rules, such as the "buy America" requirements.

People knowledgeable about government procurement believe SARA has a good chance for passage in the House. Procurement rules tend to fly under the radar of most lawmakers, Allen said. Furthermore, Davis served as a procurement attorney before being elected to the House and has largely become the congressional expert on government procurement. Many members are willing to let him take the lead on these issues, experts say.

However, there will be hurdles. One of the most controversial parts of the bill would mandate a re-examination of socioeconomic requirements, such as provisions that call for agencies to set aside a certain amount of work for small or disadvantaged businesses. The dollar thresholds have not been updated since they were created, Davis said. Some have argued that although they may have been sufficient when they were instituted, they now need to be adjusted for inflation.

"The thresholds are not in line," Davis said, but he acknowledged that the provision will be controversial.

He added, however, that the most important consideration in government procurement is getting the best value for the taxpayers.

The bill would also resurrect the concept of cooperative purchasing, which would allow state and local governments to use the General Services Administration's IT schedule contracts. Such provisions have failed in the past largely because non-IT firms — specifically pharmaceutical companies — were concerned about potential competition. Davis said SARA would focus on cooperative purchasing for IT contracts only.

The legislation was in the works before Sept. 11, but has been delayed because of the terrorist attacks and the anthrax scare that prompted the House of Representatives to temporarily shut down.

Representatives of most industry groups, including the Information Technology Association of America and the Coalition for Government Procurement, have said they support the bill.