Agencies march ahead with new A-76

OMB Circular A-76

Agencies are beginning to incorporate new competitive sourcing rules into how they do business by evaluating whether jobs their employees do could be taken over by the private sector and opening some to public/private competitions.

Late last month, a group of 36 Social Security Administration employees won SSA's first competition under the Office of Management and Budget's Circular A-76. They were competing to keep their jobs validating testing software. Other agencies are conducting studies and holding competitions, trying to impress on their employees the importance of competing, said Dennis O'Brien, director of competitive sourcing at the Energy Department.

"This is a competition," he said, speaking last week at an Excellence in Government conference in Washington, D.C. "I tell federal employees [that] there are people out there trying to take your jobs. You have to compete."

SSA held its competition under the old A-76 rules. In late May OMB published a new set of rules intended to expedite and simplify the process.

The revised A-76 has met some resistance. Earlier this month, the National Treasury Employees Union (NTEU) filed a federal lawsuit seeking to block its implementation. Some lawmakers have introduced measures seeking to exclude specific departments and agencies, such as the Forest Service, from the rules.

None of those efforts has borne fruit yet, however, and OMB is moving ahead at full speed with the rules. Officials will meet with many agencies during the next few months to discuss the challenges agencies face, said Angela Styles, administrator of OMB's Office of Federal Procurement Policy.

"A-76 is inherently asymmetrical," said Michael de la Maza, an operations research analyst at the Air Force Space Command in Colorado Springs, Colo. "A contractor can compete against a civilian [agency employee] and take the civilian's job, but a civilian can't compete against the contractor and take the contractor's job."

Previous studies under the Federal Activities Inventory Reform (FAIR) Act suggest that about 850,000 federal jobs are commercial in nature, though some are exempt from competition. As agencies conduct new FAIR Act inventories using the new A-76, union members fear that number will rise.

"It would not surprise me to see the new figure go over 1 million," said Randy Erwin, assistant to the president at the National Federation of Federal Employees. "We are certain maximum privatization is the [Bush] administration's only concern, which means the only way to stop it is in Congress."

NTEU's suit alleges that OMB "has illegally trumped Congress" in determining whether a federal job should be subject to such competition.

Under the FAIR Act, a job is considered inherently governmental if the employee exercises discretion in applying governmental authority, said NTEU President Colleen Kelley. A-76 requires the employee to exercise "substantial discretion." The distinction may seem subtle, but she said it could lead to the reclassification of many jobs.

Stan Soloway, president of the Professional Services Council, said that the private sector is likely the salvation of a government facing an aging workforce. "The fact is the government is not an employer of choice today. It's struggling to attract and retain the people with the skills to do the jobs they need to do," he said.

Like other A-76 proponents, Styles emphasized that the purrpose of competitive sourcing is to find the best value for the government, not necessarily to outsource work. She said she does not think the new rules will change the number of jobs up for competition.

"We have a lot of jobs out there to compete," she said. "It's not about pushing them to one side of the ledger or the other."

Other A-76 advocates said the opposition was coming from expected sources.

Opponents of A-76 "are basically just trying to stop competition, period. They don't want to have to compete," said Cathy Garman, vice president of the Contract Services Association of America.

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Agency A-76 requirements

Agencies must prepare annual inventories that categorize their activities as "commercial" or "inherently governmental." They must justify in writing activities they deem inherently governmental and not open to private-sector competition.

Inherently governmental functions exist when employees exercise "substantial discretion" in making decisions that commit the government to a course of action; "significantly affect" the life, liberty or property of persons; exert ultimate control over acquisition, use or disposition of U.S. property; or determine and advance economic, political, territorial, property or the government's interests.