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IG: VA May Have Overspent on Interagency IT Awards

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The Technology Acquisition Center in the Department of Veterans Affairs' Office of Acquisitions, Logistics and Construction failed to follow federal acquisition regulations before awarding 14 interagency acquisitions and may have overpaid nearly $60 million as a result, the VA inspector general has said.

In awarding about $254 million through the 14 acquisitions, the TAC did not demonstrate that IT services could not be obtained as conveniently or economically by contracting directly with a commercial source, according to the IG.

It said this occurred because the VA's “integrated oversight process reviews” did not identify or prevent the TAC's noncompliance with the FAR requirements concerning competing task orders and using interagency acquisitions.

As a result the TAC missed an opportunity to save about $57.9 million in acquisition costs by not competing IDIQ task orders, and it could have saved about $50.8 million by competing contracts among commercial sources instead of awarding interagency acquisitions, the IG said.

It called on the Office of Acquisition, Logistics, and Construction to ensure that contracting activities can adequately justify the use of exceptions to competition requirements in the FAR when awarding indefinite delivery / indefinite quantity task orders; Require contracting activities to ensure program offices adequately document that goods and services cannot be acquired as conveniently or economically from a commercial source before awarding interagency acquisitions; and, Build work steps into the integrated oversight process to hold contracting officers accountable for preventing violations of FAR competition requirements.

However, the report also pointed out that the TAC awarded about 1,200 IT services contracts valued at about $5.2 billion, from October 2010 - June 2012, and it found no significant issues with 61 of 79 statistically selected IT services contracts.