DOD extends vendor registration deadline

Partly due to industry's sluggish response, the Defense Department has extended the deadline for companies to register in a central database that eventually is expected to play a key role in allowing the department to conduct business electronically.

DOD issued a proposed rule last September directing companies that do business with the military to sign up by March 31 with the Central Contractor Registration (CCR), a central repository of vendors' taxpayer identification numbers and electronic funds transfer information that will be used to process transactions. Vendors who had not signed up by the deadline would not be reimbursed or awarded contracts by DOD, according to the draft rule.

But DOD last week confirmed it was extending the CCR registration deadline to June 1. According to Michael Mestrovich, information management executive for the undersecretary of Defense for acquisition and technology, the deadline was extended to give vendors more time to register in the CCR and to give Defense procurement shops, especially those in far-flung offices, more time to understand how the rule would affect them.

The CCR plays a central role in helping DOD comply with Deputy Secretary of Defense John Hamre's plan to establish a completely paperless contracting process by 2000, Mestrovich said. "Now the process to get contracts and bid on proposals is very much dispersed, and companies have to fill out [the same information] over and over," he said. "Hamre believes that if we start at the front end and gather information once and use it again, it would clean up the paper process and reduce the cycle time to do business with partners."

DOD will release a final rule amending the Defense Federal Acquisition Regulation and mandating registration March 31 in the Federal Register.

Although DOD previously estimated that there were about 300,000 companies that would need to register in the CCR, the department has found that number to be inflated. "We have about 30,000 companies registered in [the] CCR," Mestrovich said. "I think that is a good starting point. I think there will be between 80,000 and 100,000 [companies registered] over time."

James Anderson, senior business consultant at the San Antonio Electronic Commerce Resource Center, which assists vendors with CCR registration, said vendors have been slow to respond to previous CCR registration deadlines.

"It really isn't anyone's fault. Part of it is growing pains," Anderson said.

For example, DOD encourages vendors to register via the Internet, but that process, until recently, had been very slow and frustrating, Anderson said. In addition, DOD initially relied on a long form that was so exhaustive that many vendors were turned off from registering. It has since added a short form.

When the final rule is released, DOD is likely to get a lot of pressure from the Small Business Administration for more information, said Christopher Yukins, a partner with Holland & Knight, a law firm in Washington, D.C. "If the DOD doesn't undertake an educational effort, many small vendors will be locked out."

Even with the extended deadline, Yukins still is not convinced that the deadline will be met. "Contractors are still confused about it," he said.