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The Defense Department has made a significant number of purchases without proper competition or justification, a recent inspector general report concluded.

The report (D2008-022) focused on Defense purchases in fiscal 2006 through two National Institutes of Health governmentwide acquisition contracts -- Electronic Commodities Store III and Chief Information Officer-Solutions and Partners 2 Innovations (CIO-SP2i). Both provide information technology supplies and services through task and delivery orders.

Richard Jolliffe, assistant Defense IG for acquisition and contract management, who performed the audit in conjunction with the Health and Human Services inspector general's office, reviewed 98 ECS III delivery orders valued at $33.2 million and 28 task orders for services under CIO-SP2i, which have a ceiling value of $697.6 million. Jolliffe concluded that the department failed to comply with a number of federal and Defense-specific regulations during these acquisition processes.

According to the report, Defense did not provide all eligible contractors with a fair opportunity to compete for as many as 95 orders and did not properly document the basis for 31 awards. This prevented Defense from ensuring that it received the best value for its purchases.

"The foundation of good contracting when using multiple-award contracts is competition, and its importance should not be overlooked," the report stated. "Failing to provide fair opportunity prevents the government from achieving savings through competition."

The report found that the department also failed to complete certain steps and establish mechanisms to ensure that contractors perform efficiently. In reviewing 28 task orders whose acquisitions were assisted by NIH, the inspectors general found numerous cases in which Defense officials did not allow contractors sufficient time to respond to requests for quotes and provided inadequate price analysis information and contract surveillance. Additionally, NIH contracting officials allowed out-of-scope work in several instances and did not prepare required documentation on the task orders reviewed.

The report concluded that Defense lacked effective internal controls over interagency acquisitions and did not justify using a non-Defense contract for 48 contract actions valued at $156.7 million. The department provided inadequate justification for an additional 62 contracts valued at $99.9 million. The report said the undersecretary of Defense of acquisition, technology and logistics is addressing those issues.

The report noted that these problems were not isolated to Defense procurements through NIH contracts. The IG reached similar conclusions in reports on Defense's use of NASA and General Services Administration governmentwide acquisition vehicles, and Defense officials said they are taking action to fix the problem. Shay Assad, director of Defense procurement and acquisition policy, reviewed a draft copy of the report and concurred with all of Jolliffe's recommendations.

Assad wrote that the Office of the Undersecretary of Defense for acquisition, technology and logistics will issue a memorandum to all contracting officers on the problems identified in the report and re-emphasizing acquisition regulations guiding interagency acquisitions. He said the office expected to issue the memo by Nov. 30.

COMMENTS

• Did anyone stop to ask themselves WHY the DOD program offices went to GSA and NIH etc. to get their needs met? Because: 1. The DOD Acquisition workforce was cut drastically in the 90s and the workload just grew and grew. 2. Doing it RIGHT and IAW the laws and regulations takes time and resources. It was easier to go to NIH who did not worry about following the rules. 3. It seems no one does any planning any more (probably because of the funding dilemma noted below, and also because we are in a war). But where are we now? Now, DOD is greatly restricting what can be offloaded and insisting it be done by DOD Contracting Offices. But have they increased the staffing at all? Of COURSE not! Have they increased planning? OF COURSE not. Has congress relaxed any of the hoops we have to jump through? OF COURSE not. I agree with the Defense Acquisition Performance Assessment. The system (big A) is SO broken, it's a wonder we get done what we do. I agree, I'm also at Wit's End. jennifer Posted November 29, 2007 1:13 PM
• "All of the millions the DoD wasted on DAWIA training" went to the IT companies. Most of the training is now just online courses that the student can click through to get to the test. Then you just use printouts or search electronic version of the text to find the answers. What in class training is left is just running through a contract scenario where you are supposed to apply the information provided on-line. The classes are less than two weeks long, provide very little time for experience sharing and even less in the way of actual instruction. K D Posted November 27, 2007 11:54 AM
• The report states, "We previously reported similar results regarding DoD contracting officers’improper use of non-DoD multiple-award contracts in the DoD Inspector General (IG) Report No. D2007-023, “FY 2005 DoD Purchases Made Through the National Aeronautics and Space Administration,” November 13, 2006." How many more reports does the DoDIG have to issue before DoD contracting officers start getting the process right? Maybe there's some collusion going on here. The contracting officers continually screw up so the DoDIG has something to investigate and report on each year. Bureaucratic commensalism. Advocator Posted November 27, 2007 12:16 PM