The Obama administration is weighing what could be the most ambitious federal contracting transparency effort yet. In May, the civilian and defense acquisition councils, which craft changes to the Federal Acquisition Regulation, caught the federal marketplace by surprise when they announced in an advance notice of proposed rule-making that agencies soon might be required to publish copies of their contracts online in a public database.
The councils are seeking public comment on how best to amend the FAR “to enable public posting of contract actions, should such posting become a requirement in the future, without compromising contractors’ proprietary and confidential commercial or financial information,” a May 13 Federal Register notice stated. The announcement referenced seven administration memos and directives issued during the past 18 months calling for increased transparency from federal agencies. But none of those documents mandated – or even suggested – the posting of government contracts online.
A sweeping mandate to post the text of about 30 million contractual actions online would have significant repercussions for both government and contractor officials. Most contracts include proprietary information about a company’s price, employee salaries and technical capabilities that could prove devastating if disclosed to competitors. Virtually every document would have to be redacted, a heavy lift for federal workers, even with an automated process.
“It will take some effort to go through these things and think about what is sensitive and too troublesome to be released,” says Allan Burman, president of the Jefferson Solutions consulting firm and former administrator of the Office of Management and Budget’s Office of Federal Procurement Policy. “You need a reasoned view from the government, because they can’t just accept what the contractor proposes.”
Industry officials say the initiative is not worth the effort, particularly given that citizens generally can obtain copies of government contracts through Freedom of Information Act requests. In addition, since December 2007, contract summaries – including the name of the vendor, cost of the award, place of performance and nature of the work – have been available on USASpending.gov.
Larry Allen, president of the Coalition for Government Procurement, a contractor trade association, says a very small percentage of citizens would understand the highly technical language buried in the text of federal contracts. “The public is not missing out on much,” he says. “You are not gaining a whole lot, but you are creating a heck of a lot of work for the government.”
But federal watchdogs argue taxpayers have a right to know how the government is spending their money. Scott Amey, general counsel for the Project on Government Oversight, a Washington-based group that has advocated posting contracts online, says the technology exists to protect proprietary data and provide a window into the often arcane federal procurement process. “The administration’s proposal is a refreshing shift after so many years of watching billions of dollars fly out the door and only coded summary data to justify that spending,” he says.
The idea of posting copies of contracts online is not new. During the 2008 presidential campaign, then-Sen. Barack Obama and Sen. Tom Coburn, R-Okla., introduced a follow-up to their 2006 Transparency and Accountability in Federal Spending Act, which created USASpending.gov. The 2008 legislation, co-sponsored by Obama’s Republican rival for the presidency, Arizona Sen. John McCain, would have required federal agencies to post online searchable copies of all contracts they awarded; details about the bidding process; assessments of work already performed; and information on civil, criminal or administrative proceedings against award recipients.
Despite the high-level support, the legislation never moved out of the Senate Homeland Security and Governmental Affairs Committee. An identical bill in the House also floundered. A Senate Democratic source familiar with the measure says some in the George W. Bush administration “questioned whether it was possible to do everything that the bill tried to do.” Among the concerns raised was the feasibility of going through every contract line by line searching for private information to redact.
“It’s certainly a worthy goal to provide people information about who is getting contracts,” Burman says. “I think on balance people would argue that sunshine and openness are good things. But, there is an element of cost associated with all of this.”
OMB spokeswoman Jean Weinberg says the administration is examining the operational challenges associated with publishing copies of contracts. Officials are looking forward “to reviewing the comments [to the Federal Register notice] and having further discussions with agencies and industry to ensure we are appropriately considering their concerns while continuing to promote open government and transparency,” she adds.
Some agencies have experimented with posting contracts online. The Treasury Department has published hundreds of contracts to companies receiving assistance through the Troubled Asset Relief Program. And the General Services Administration released a heavily redacted copy of its contract for the redesign of Recovery.gov, the administration’s central repository for Recovery Act data.
But those efforts have been scattershot and limited to high-profile circumstances. Amey says the administration should consolidate its efforts and create a one-stop shop on USASpending.gov for all federal spending – contracts, proposals, solicitations, audits, performance data, grants and leases.
“POGO envisions an electronic system that allows certain fields or protected data to be redacted from public disclosure,” Amey says. “The result will be a system that reduces paper shuffling and finally allows the public to see details, not scant coded summaries, about goods and services the government buys each year. This effort is a win-win for the government and taxpayers.”
— By Robert Brodsky – Government Executive magazine – August 1, 2010