Bush threatens veto in competitive sourcing fight

OMB Statement of Administration Policy

Competitive sourcing is once again at the center of a debate between the White House and Congress, and a presidential veto threat now looms over one of the fiscal 2004 appropriations bills.

Unless the House keeps out an amendment that critics say "would effectively shut down" the Bush administration initiative, the Office of Management and Budget will recommend that Bush vetoes the bill.

The House version of the Transportation, Treasury and Independent Agencies fiscal 2004 appropriations bill covers several areas of the President's Management Agenda, including workforce improvement and better use of e-government technologies and practices. The Sept. 4 statement of administration policy from OMB reiterates the White House's commitment to those areas, despite the House subcommittee's cuts.

But the bill's biggest threat comes from two separate amendments expected to be proposed this week by Reps. Chris Van Hollen (D-Md.) and Alcee Hastings (D-Fla.), which would limit agencies' ability to compete commercial-like functions between government and the private sector.

Many in Congress have criticized the administration's competitive sourcing initiative, citing, among other issues, agencies' inability to manage competitions and a possible negative affect on federal morale.

The White House tried to appease some concerns by removing all references to goals for the percentage of positions to be open for competition. But if the final version of the appropriations bill includes a specific prohibition, the recommendation to veto the entire $90 billion bill will go forward to the president, according to the OMB statement.

The administration has held that the initiative is intended to increase efficiency and performance of government services. "Now is the wrong time to short-circuit implementation of this principle, especially since numerous agencies are starting to make real progress in this area," OMB officials say in the statement.

Competitive sourcing has produced many disagreements. The leader of the initiative, Angela Styles, administrator of OMB's Office of Federal Procurement Policy, announced last week she would be leaving government on Sept. 15.