DOD’s contractor database could lead to the wrong results

Senior defense official cautions against hinging contract awards on past-performance records.

A top defense acquisition policy official said the government should not overemphasize a company’s past work when awarding a contract because its limited database of information might become a barrier for some companies.

At a hearing March 28, Ashton Carter, undersecretary of Defense for acquisition, technology and logistics, said the Defense Department does not have adequate data on past performance on which to base a contract award. He also questioned how DOD would handle cases in which companies want to break into the defense industry but have no work history with the federal government. Even if the company has done similar work for a foreign government, DOD would not have a record of it.

“I think it’s important that we not do anything that erects a barrier to entry for a contractor,” he told the Commission on Wartime Contracting in Iraq and Afghanistan. (Watch the entire hearing.)

That would leave the principal burden on senior officials to get the defense acquisition workforce to collect more reliable information on companies’ work.

In its interim report, the commission recommends aligning past-performance assessments with contractors’ proposals for available awards.

The commission wants revisions to agency policies for contingency-related contracts “to limit contractors’ proposed federal past-performance references to only those contracts that have been recorded in the government’s past-performance database,” the report states.

At the same time, the commission said agency officials do not record detailed evaluations of contractors’ performance on a job because it’s not a priority for them, which could lead to giving contracts to habitual poor performers.

“Agencies’ failure to record contractor-performance assessments is costly,” the report states.

Carter’s comments echoed what other federal officials told the commission in February about the same past-performance recommendation. Maureen Shauket, chief acquisition officer at the U.S. Agency for International Development, said she was concerned about everyone getting a neutral rating on a past performance, “and that’s not in anyone’s interest.”

Dan Blalock, the Navy’s counsel, said defense officials need to make decisions based on each case’s circumstances.

Furthermore, Carter disagreed with the commission’s recommendation to increase the use of suspensions and debarments. The commission has proposed mandating automatic suspensions of indicted contractors and preventing contractors from avoiding suspensions and debarments through administrative maneuvers. Dan Gordon, administrator of the Office of Federal Procurement Policy, also disagreed with that recommendation during the February hearing.

Carter said the government needs to root out fraud early in the process, and agencies must monitor contractors’ work closely.

“My gaze is principally on prevention and detection,” Carter said, and suspending or debarring a company is well beyond the point of acting on a problem.

“We need to get back to the front end of prevention and detection of fraud,” he added.

The commission plans to send its final report to Congress in July. It will include recommendations for improving contracting in war zones.