OFPP administrator attempts to draw clear lines

Daniel Gordon, administrator of the Office of Federal Procurement Policy, today said he is working to rebalance the government’s relationships with contractors, as agencies have overly relied on the private sector for services.

“There are too many anecdotes that suggest that work that is really inherently governmental, work that needs to be reserved for federal employees, is, in fact, being done by contractors,” Gordon said at a breakfast hosted by the Coalition for Government Procurement, an industry association.

Contractors aren’t doing the inherently governmental work because of “an evil intent.” Instead it may be a sign of the economically "oppressive times" or other constrictions on the workforce, he said.

A handbook on acquisition reforms

'Inherently governmental' defies quick definition

“We need to be sure that we understand what the rules of the game are,” Gordon said.

OFPP, part of the the Office of Management and Budget, plans to release its draft policy letter on a definition of inherently governmental functions before the end of March. The proposal will also address the issue of critical functions, or jobs that are closely associated with the government employee-only jobs but can still be done by contractors, if necessary. Gordon said the letter is only a draft, and his office wants comments from government and industry on the proposal.

“I will tell you that one of my goals is that this document ultimately provides real clarity,” he said. When it comes to inherently governmental functions, “the rule should be clear.”

However, experts say Gordon faces a major test if he wants a definite line in the sand.

“No one has ever been able to define it,” said Bill Gormley, president and CEO of the Washington Management Group and a former assistant acquisition commissioner at the General Services Administration.

Past administrations have tried, but gray areas remained, experts say.

Gordon also said he is looking at the number of multiagency contracts or indefinite-delivery, indefinite-quantity contracts, which are springing up across agencies. The individual IDIQ contracts may benefit an agency by offering good prices and necessary terms and conditions, but too often the contracts simply duplicate each other, Gordon said.

“My sense is, it doesn’t make sense for industry, and it doesn’t make sense for agencies,” he said. The government is spending time and money putting the contracts together and industry is spending resources getting on each of them.

“It doesn’t feel like it’s justified,” Gordon said, adding that he and his staff are considering ways to reduce the number of these contracts.

He’s also looking at strategic sourcing programs. He said the federal government should be getting prices that reflect its overall position as a massive buyer, not a slew of much smaller purchasing agencies.

However, Gordon said he doesn’t favor a mandatory strategic-sourcing blanket purchase agreement or similar contract.

“The mandatory route was tried for a couple of decades, and I think most people would tell you that it was somewhat problematic,” he said. He said a mandate would not be helpful today either.

Gordon instead wants to create a contract that is so appealing to agencies that they will voluntarily buy from it.

Several industry executives said they were concerned by strategic sourcing initiatives. Their companies can offer the government low prices, but there is no guarantee that agencies will buy enough for the companies to recoup their money. To build that appealing contract, Gormley said, the government must offer companies a financially guaranteed minimum number of purchases.