The National Institutes of Health is confident it can survive the scrutiny of the Office of Federal Procurement Policy as OFPP reviews the agency’s governmentwide contracting authority.

“We feel very confident that we have a successful program,” said Diane Frasier, director of the NIH Office of Acquisition Management and Policy, said April 7. “We are tried and true.”

NIH has come under some increased scrutiny as reports have surfaced that the General Services Administration has asked OFPP to not extend NIH’s GWAC authority.

Fraiser would not explicitly say whether NIH’s governmentwide acquisition contract would receive the blessing from Office of Management and Budget procurement officials, but she said her program has been around for 14 years and has received OMB’s designation as a GWAC host since 2000.

To be a GWAC, OFPP must grant an agency the designation. And few are given. Agencies with designations must get OFPP’s approval whenever one of their GWACs comes up for renewal. Compared to the number of multiple-award contracts surfacing throughout the federal government, government-wide contracts are a rarity. Only NIH, the General Services Administration, NASA and the Environmental Protection Agency now have the designation.

NIH’s Information Technology Acquisition and Assessment Center (NITAAC) has submitted its materials to OFPP. Frasier expects to sit down this month with Daniel Gordon, OFPP administrator, and his staff, to discuss NITAAC’s status as an executive agent of GWACs.

“We have to assure them that we have a well-run program,” Frasier said. One proof of its success is its sales. Since January NITAAC has had more than $100 million in orders on its Chief Information Officer-Solutions and Partner2i (CIO-SP2i) GWAC.

She also said agencies trust NITAAC enough to send their big orders to the center. Agencies, such as the Defense Department, have looked to CIO-SP2i for demands with engineering and program support, security information management systems and Internet-accessible database services. The Obama administration’s drive for a more open government may even bring more customers to NITAAC, Frasier said.

If NITAAC gets the designation from OFPP, Fraiser can take the next step in getting bids for its CIO-SP3 and CIO-SP3 Small Business contracts. NITAAC has already released a draft request for proposals and in March formally responded to questions about the contract. Fraiser said she expects business to continue growing, and to that end, NITAAC has put the ceilings for each CIO-SP3 contract at $20 billion.

Still, NITAAC has lost business as agencies, such as the Homeland Security Department, launched their own department-wide IDIQs or as other agencies set up multiple-agency contracts, Frasier said.

Despite agencies’ efforts to launch their own vehicles, Frasier said they should realize the GWACs have strict standards and reporting requirements for OMB. They are held to a higher standard, unlike the other contracts popping up.

Multiple-agency contracts are similar to GWACs in that both are interagency contracts. However, GWACs are specifically for information technology products and services, and agencies interested in awarding a GWAC must first get OFPP’s permission. They don’t need that approval to award MACs.

Facing OMB’s review of her program, Fraiser said she’s not running a “fly-by-night operation.”

“NIH has 14 years of experience in running a major IT program, and was one of the first programs to earn OMB’s designation as a GWAC,” Frasier said.

The General Services Administration seems to again be pushing to be the only provider of governmentwide acquisition contracts. The agency’s GWAC director is trying to get the Office of Federal Procurement policy to strip GWAC authority from the National Institues of Health, according to Joanne Woytek, program manager at NASA’s own Solutions for Enterprisewide Procurements GWAC, wrote today on FCW.com.

Woytek reported this in a posting to Harvard professor and FCW blogger Steve Kelman’s Facebook wall, and Kelman in turn based a blog entry on it.

Woytek said Friday morning that she has not been contaced by GSA or OFPP about rescinding NASA GWAC authority.

Officials from NIH’s Information Technology Assessment and Acquisition Center  are slated to meet soon with Dan Gordon, OFPP administrator, to discuss a request he recevied to remove NIH’s Chief Information Officer-Solutions and Partners contract from the list of GWACs, according to Kelman.

Woytek said in her Facebook posting that she thinks GSA will try the same maneuver with SEWP when it comes up for renewal in 2012. Her Facebook posting and comment on Kelman’s blog were just “heads up” that she wanted to pass on to him, she said Friday.

None of the agencies involved responded to requests for comments.

Overall GSA’s move, which is not the first attempt by the agency, raises the question of whether the government has too many GWACs, multiple-award contacts and indefinite-delivery/indefinite/quantity contracts, and if they have started overlap.

Experts are split on the decision.

Competition among contract vehicles, including the alternative default contracts inside each agency, promotes customer service and innovation, like competition in other markets, Kelman wrote. When GSA had a monopoly on the government contracting business, it also had poor customer service and little innovation when it had a monopoly on the government buying market, Kelman — himself a former OFPP administrator — wrote.

Martha Johnson, GSA’s administrator, agreed in a recent speech at FOSE 2010, saying GSA didn’t know how to spell “marketing” when agencies were required to buy from GSA. Competition has forced GSA to improve on its innovation and customer service.

However, other experts say there are too many GWACs that are selling much of the same items, especially commodity IT products. As a result, it creates inefficiencies in government operation.

Woytek disagreed with this characterization, saying there are only two commodity GWACs – SEWP and NIH’s Electronic Computer Store.

Bob Woods, president of Topside Consulting and a former GSA commissioner, said agencies should let the larger organizations, such as GSA, handle the commodities. Then the agency can allow employees in their contracting shops to attend to the agency’s unique purchases.

“Competition isn’t as important if you’re not taking care of the basics of business,” he said.

Furthermore, agencies can save money by paying the GSA’s 0.75 percent fee upfront to get general products, instead of launching their own contracts to get the same things, he said.

SEWP’s fee is 0.5, which would be even greater savings for agencies than using GSA’s vehicle, Woytek said.

At the same time, the government may be paying higher prices because of too many contracts

Ray Bjorklund, senior vice president and chief knowledge officer at FedSources, said companies believe they should be on each of the contracts to have access to a lot of business. But it creates more work and more divisions inside a company to deal with each contract’s specific requirements, such as reporting information.

As companies submit more bids and pour more resources into getting a chance to even compete for the work, costs can increase for the govenrment, he said.

Today, the marketplace has changed dramatically since the 1990s when agencies were first given the chance to start up their own contracts, he said. Now, most agencies have settled on their client, and industry is advanced enough to handle more complex work. The government now should consider GSA’s move several years ago to merge two different GWACs and created the Alliant GWAC for IT products and services. While there were some bumps along the GWAC’s way with bid protests and court cases, the principle is fine, he said.

Now, the acquisition community is waiting for officials in OFPP, who have the authority to deny an agency its GWAC status, to decision how it plans to address the issue of too many contractors or more competition.

“I wish OFPP would take a leadership position and reconcile this issue of GWACs and multiple-agency contracts,” Bjorklund said.

by Matthew Weigelt–Federal Computer Week-Apr, 01, 2010 – About the Author: Matthew Weigelt is acquisition editor for Federal Computer Week.  © 1996-2009 1105 Media, Inc. All Rights Reserved.