Civilian contractors finding themselves in congressional crosshairs

When Democrats took control of Congress in 2006, they pledged major changes in government contracting.

Mission accomplished.

The pressure of congressional oversight, coupled with the upcoming presidential election and transition, has radically transformed the acquisition landscape. Several large firms have had to regroup or to leave the government marketplace.

Virtually every major civilian contracting office ended up in Congress' crosshairs during the past year.

The State Department become a lightning rod for criticism after guards for one of its security contractors, Blackwater Worldwide, opened fire in a Baghdad square in September 2007, killing 17 civilians and injuring two dozen. Despite charges of inadequate oversight, State renewed its contract with Blackwater.

The Homeland Security Department faced complaints about how it calculated the number of contracts going to small businesses, cost and schedule overruns on its electronic border fence and spotty implementation of its Transportation Worker Identification Credential program.

Contracting oversight also might have led, in part, to the dismissal of three high-ranking administration officials. The Census Bureau's deputy director Jay Waite stepped down in May after his plan to use handheld computers developed by a private contractor for the 2010 Census was scrapped due to major delays and ballooning costs. Housing and Urban Development Secretary Alphonso Jackson was forced out after criminal investigators raised concerns about favoritism in HUD contracts. And General Services Administration head Lurita A. Doan was fired, in part, over questions about contract interference.

Setbacks also surfaced at agencies relying on competitive sourcing to reduce costs. The 2008 Defense authorization bill prohibited public-private sector job competitions at the Labor Department, Bureau of Prisons, Army Corps of Engineers and Forest Service. Nonetheless, the Bush administration touted the success of the program, noting that the 4,000 competitions conducted in fiscal 2007 would yield nearly $400 million in savings.

The administration made incremental progress in building up the acquisition workforce, adding more than 2,500 employees in fiscal 2007. Skeptics, however, argued that workforce growth has failed to keep pace with federal contract spending.

Even more change will be in store for procurement offices as a trifecta of major contracting bills gets closer to passage. The Senate will be considering three bills that passed the House in April aimed at increasing transparency and avoiding waste, fraud and abuse. The bills would create a governmentwide database of contractor performance and misconduct; bar tax-cheating companies from winning contracts and force some large contractors to disclose the salaries of their highest paid employees.

As agencies gear up for the first presidential transition in eight years, procurement reform will remain a source of debate.