Contracting - Improvement or the S.O.S.?

Take the contracting hot tub time machine back a few years to the early 1990s. Mötley Crüe was topping the charts, and government reform zealots shifted the thinking about how the government should operate, including how it should purchase good and services. Some of those reforms have been hits, others have not.

Today, the Obama administration is attempting to shift the contracting culture back to one that places a premium on spending taxpayer dollars wisely. Revolving doors have been closed, outside influences have been mitigated, contracting advice has been distributed, and acquisition memos have been published.

One aspect that hasn't changed is the endless stream of government reports highlighting failures in the contracting processes and wasteful federal spending. In March, the House Armed Services Committee's Panel on Defense Acquisition Reform issued its findings and recommendations. One reporter described the buzz around the release of the report with one word: "crickets." The report highlights the need to improve the acquisition system, requirements definitions, the work force, and financial management systems, and to increase competition. POGO can't argue with any of these recommendations, but wonders how this report is any different than other government reports that are collecting dust on book shelves. What does the DoD and Congress plan to do with the results of this study – ignore it, nibble around the edges, or make a real attempt to resolve contracting deficiencies?

A recent report by the DoD IG provides a great example of the pitfalls of poor contract planning and oversight. Due to poor contract requirements and oversight on a KBR vehicle maintenance contract (LOGCAP III task order 159) in Iraq, KBR racked up millions in costs for maintenance services that were not required. According to the report, "KBR utilization reports indicated that from September 2008 through August 2009, there were 213,570 available man-hours for tactical vehicle field maintenance services, but that only 14,068 actual man-hours were needed to perform the maintenance required by the Army." One article stated that "what the military got was as many as 144 civilian mechanics, each doing as little as 43 minutes of work a month, with virtually no oversight."

The Army has taken steps to correct the problem, but once again, taxpayers are left footing the bill. I hate to sound too skeptical, but these reports, and the long life-span of many of the problems that are identified, make me wonder if waste, fraud, and abuse are too big for the government to fix. Are these problems a mere cost of doing business? A recent State IG report says that contractor performance is directly related to federal oversight, but can we oversee everyone all the time? History repeats itself in many of these reports, but we are often stuck in the same 'ol situation (S.O.S.).

-- Scott Amey

Photo: http://www.flickr.com/photos/banfflakelouise/ / CC BY-NC-ND 2.0

Comments

[Mike]

There were many signs since 2003 that KBR had issues, but KBR was too big to fail and was the only contractor that could do the job - that is in the minds of the Army. The Army knew that KBR was getting higher prices, but they felt it was worth it because we were at war and no other contractor could do the job. You have to understand that the Army and many contracting officers are focused on delivering the product, cost does not matter. They get too close to the contractor and lose objectivity. DCAA reported numerous cost issues very early and were ignored and are still being ingnored. But KBR is not the only example where the Government looked the other way on cost in the interest of getting the product. Most large contractors such as Boeing, Lockheed, GD, have benefited from the mentality that all that matters is getting the product. That's why sole-source has to be the last resort - competition on an annual basis has a better chance of keeping contractor costs in check. Any doubt, look at contracts awarded in the intelligence community. Excess profit, prices, all in the interest of national security. No chance of a hearing to expose the corrpution since there is no oversight of the GAO or IGs.

[Observer IV]

The KBR labor waste, retrospectively, would be very easy to spot and control. Some one individual was the contracting officer's tech rep for the task, who should have known the workload and how the contractor was staffing. The waste could have been shut off quickly. Did the IG identify that person? If there was no one, than the stuckee is the contracting officer. If not, go up the chain(s). KBR deserves some scrutiny, and penalty if at all possible. The government oversight person should at a minimum be fired and also subject to investigation for criminal negligence. If this contract were a fixed price task, the person responsible for that should be investigated for the same violation. Military, Dept. of the Army civilians, and contractors are all obligated to report waste. There needs to be a penalty for ignoring the obvious.