OMB releases final A-76 revision

Revised A-76

The Office of Management and Budget today released the final revised Circular A-76, which will be a primary mechanism for fulfilling the Bush administration's competitive sourcing management agenda.

The final circular outlines a public/private competitive process that is based on performance rather than relying mainly on price.

Agencies will be expected to use the process when opening commercial-like federal functions to competition. These functions are the ones that agencies have listed under the Federal Activities Inventory Reform (FAIR) Act of 1998 as not inherently governmental.

One of the biggest concerns addressed during the revision process was imposing a 12-month time limit on competitions as a general rule. Under the old circular, competitions often dragged on for years.

OMB received many comments disagreeing about the time limit, but officials decided to keep the 12-month rule. However, the final circular does include a provision allowing the agency competitive sourcing official running the competition to extend the period by six months after notifying OMB.

The final circular also addresses another major concern: the use of direct conversions to move smaller functions to the private sector without any competition with the government group performing the work.

That process has been eliminated, and a version of the streamlined competition process from the old circular is now in place for all competitions involving 65 or fewer full-time employees.

OMB has been working on the circular revisions since the May 2002 release of a congressionally mandated report from the Commercial Activities Panel. The panel's recommendations, developed by a group of public- and private-sector experts and led by the General Accounting Office, focused on the need to move to more performance-based competitions and a process based on the Federal Acquisition Regulation.