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Debate Over Army Contract Continues

Mar 30, 2006 (10:03 AM EST)

Read the Original Article at http://www.informationweek.com/news/showArticle.jhtml?articleID=184417342


Delays continue to plague a contract for operating support at Walter Reed Army Medical Center awarded to IAP Worldwide Services (IAPWWS), further bolstering the side of the argument that maintains public-private competitions are more trouble than they're worth.

At the heart of the matter are claims by representatives within the government that the award violated time limitations associated with competitive-sourcing requirements. Competitive sourcing is a management initiative intended to make government more market-based by putting up for bid functions that are not inherently governmental, and pitting an inside team -- dubbed the "most efficient organization" (MEO) -- against private-sector companies for the work. The process for determining which functions warrant a public-private competition is spelled out in the Office of Management and Budget (OMB) Circular A-76, which was revised in May 2003 to make "best value" instead of "lowest cost" the factor that determines wins and to incorporate a 12-month time limit on competitions. The changes were an attempt to address issues over timeliness and fairness of the process, and to level the playing field.

But some say the attempt failed on both counts. Not only do internal MEOs win the majority of competitions -- 91 percent in 2004, according to a report released by OMB -- but those that do filter to private companies are frequently delayed by protests. In the case of the Walter Reed Army Medical Center contract, the MEO made adjustments to its proposal after bids had been opened and exposed; as a result, the MEO was decertified following a review, and the contract was awarded to private contractor IAPWWS, formerly Johnson Controls World Services.

And yet, implementation of that contract has yet begin, thanks in part to objections voiced from within the government. Del. Eleanor Holmes Norton (D-D.C.) said on WTOP radio that she and others suspect the "contract was even rigged," and that "the government does not have to continue in this contract if it is illegal."

But according to the Professional Services Council (PSC), such claims are unfounded.

"Norton and others on the Hill have gone to the Secretary of the Army and asked him to delay the award, arguing that it was supposed to be completed by the end of fiscal 2004," says Stan Soloway, president of PSC, which is calling for the immediate implementation of the contract by Secretary of the Army Francis Harvey. "What they're missing is the fact that the timeline requirement only covers the span of the competition; there's no way a law could prescribe how long appeals and protests will take."

Given that the initial award was made in September 2004, Soloway says no violation of time requirements occurred.

"What's really bothersome here is that this contract stands as a case of severe violation of procurement integrity on the government's side, and yet they continue to hold it up," he says. "Why would they ride this horse?"