Every Friday, POGO will strive to make one document available that we or others have obtained through the Freedom of Information Act (FOIA), especially documents that have not previously been posted online. Some of these documents will be more important than others, some may only be of historical interest— although relevance is in the eye of the beholder. POGO is doing this to highlight the importance of open government and FOIA throughout the year.
By NICK SCHWELLENBACH
This week's document: Audit report on "Advisory and Assistance Services Contracts"
Document agency: Air Force Audit Agency (AFAA)
Document number: F2011-0001-FC1000
Document date: November 30, 2010
In a nutshell: The Air Force spent $94.3 million on eight contracts "that constituted work so closely supporting inherently governmental functions as to create significant risk that the contractors could influence or direct decisions that are not in the best interest of the Air Force," according to the report. This work included developing and recommending policy changes, governing, strategic planning for the Air Force, creating and submitting budget requests, and evaluating other contractors cost proposals. The three Air Force locations that contracted out this work were Hanscom ($71.7 million), Los Angeles ($14.7 million), and Wright-Patterson ($8 million).
In other words, contractors were doing things that we expect government employees, and only government employees, to do. Thus, “the Air Force increased its risk for potential loss of government control over and accountability for mission-related policy and programs.”
The November 2010 AFAA audit appears to be unreported. Its findings come as Congress, the White House, and the Department of Defense have debated the merits of insourcing, considering whether government employees are cheaper than contractors, and the risks of contracting out functions that are crucial government powers.
“Although contractors provide vital expertise,” the AFAA audit says, “Air Force organizations must be alert to situations in which excessive reliance on contractors undermines the ability of the Air Force to accomplish its missions and can lead to the erosion of the in-house capability that is essential to effective government performance.”
The Air Force Audit Agency (AFAA) audit also said the Air Force spent $754.4 million on contractors for work “that may have been more appropriate for government employee performance.” The $94.3 million work “closely related to inherently governmental functions” is a subset of the $754.4 million.
Some of this $754.4 million in work was considered “personal services” (which are generally barred by law) and “enduring operational tasks.” More details on these from the audit (the two bullets are taken directly from the audit):
- Personal Services. Four Air Force organizations acquired $22.9 million of A&AS support on four contracts that included personal services. To explain, the contractors’ performance was typically performed in government offices, using government equipment under the supervision of government employees, thereby creating an employer-employee relationship. For example, government employees, such as quality assurance evaluators, assigned contractor employees day-to-day tasks and directed the work efforts of contractor employees. The contractor employees had performed the same recurring and routine work for 3 to 8 years. These extended performance periods demonstrate that management could have reasonably expected the need for the support to exceed 1 year.
- Enduring Operational Requirements. Eight Air Force organizations acquired $749.9 million of A&AS support on 18 contracts to accomplish enduring, day-to-day operational requirements that may have been more appropriate and economical for government performance. For example, A&AS contractor personnel routinely performed Defense Travel System administrative tasks, security monitor duties, cost estimating, and financial analysis. Further, the Air Force had acquired the ongoing A&AS support for at least 6 years and as much as 26 years on 8 of the contracts.
“These conditions occurred because mandatory manpower reductions forced Air Force organizations to increase their reliance on A&AS contractors to perform their mission,” the AFAA audit says. Translation: the Air Force did not turn to contractors because they are cheaper, rather the Air Force was forced to shed government workers.
“In addition, the Air Force acquisition policies did not include a requirement for organizations to assess the risk associated with acquiring contract A&AS,” notes the audit. On top of this lack of a requirement to assess the risks of outsourcing, the Air Force “relaxed” requirements for justifying outsourcing these tasks to contractors. This relaxation eliminated “a management control that helped ensure organizations fully evaluated requirements and justified” decisions to outsource.
Also, “the Air Force did not establish a process that required acquiring agencies to establish a plan for hiring government employees when government performance was more cost-effective.”
POGO also wants to acknowledge that the AFAA has done a comparatively good job at posting its reports released through the Freedom of Information Act (FOIA) on the Air Force’s reading room. This audit, which appears to be previously unreported, is available on the Air Force FOIA reading room.
Read this week's FOIA Friday document. Stay tuned for a POGO report that takes a deeper look at contractors performing inherently governmental functions.
Nick Schwellenbach is POGO's Director of Investigations.