DOD removes restrictions on IT buys

A controversial provision that would restrict Defense Department time- and labor-hour service buys using the General Services Administration's schedule contracts did not make it into a final rule designed to boost competition on the department's multiple-award contracts.

In the Oct. 25 Federal Register, the Defense Department published a final version of a rule that implements Section 803, which references the citation in the fiscal 2002 Defense authorization bill.

The final rule does not include a provision that would have restricted DOD buys using the GSA schedule to firm, fixed-price task orders. The Office of Management and Budget's Office of Federal Procurement Policy attempted to add the provision but ran into opposition from industry groups.

The final version of the rule notes that OFPP intends to "work with the other [Federal Acquisition Regulation] Council members to develop appropriate revisions to the current FAR" regarding labor-hour contracts.

"In terms of all the possible 803 outcomes, this is the best one we could have hoped for," said Larry Allen, executive vice president of the Coalition for Government Procurement, one of the industry groups that lobbied against the GSA schedule restriction.

And if that provision is revisited in the future, "it will be in an open format where everybody's voice can be heard," Allen said.

The final rule includes a section on training so that contracting officers and vendors understand the implications of Section 803. Deidre Lee, director of Defense procurement, said DOD will offer courses and training sessions, including one that will be available online.

DOD will post training courses on the Defense Procurement Web site at www. acq.osd.mil/dp.

The rule essentially requires that DOD put service task orders of $100,000 or more out for bid, except under certain circumstances. Contracting officers should try to get responses from at least three contractors and make sure all offers are fairly considered.

The rule also allows blanket purchase agreements to be established against Federal Supply Schedules, but contracting officers must monitor them carefully, including reviewing BPAs at least annually to determine whether they still represent the best value.

Allen said many procurement officials likely were following 803 without documentation, "and now they will document it."

"There's a nice balance because the government gets competition, but the government procurement process is not unduly burdened with extra time- consuming steps," he said.

***

Buying requirements

The Defense Department issued a final rule that implements Section 803 of the National Defense Authorization Act for fiscal 2002.

The rule:

* Requires that DOD compete service task orders of $100,000 or more, except under certain circumstances.

* Requires contracting officers to try to get responses from at least three contractors that can fulfill the work and make sure all offers received are fairly considered.

* Allows blanket purchase agreements to be established against Federal Supply Schedules, but contracting officers must monitor them, including determining whether they still represent the best value.

* Includes a section on training so contracting officers and vendors understand the implications of Section 803.