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The USPS annually spends about 28 percent of its contract dollar commitments through noncompetitive contracts but is not ensuring that all of its controls over such contracts are being followed, an IG audit has said.

Spending on such contracts was $1.5 billion, $2.8 billion and $1.7 billion in 2018-2020, it said, adding that “there are business situations when the noncompetitive purchase method better suits or is needed to meet the business objectives of the Postal Service.”

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However, it said that in a sample of 157 such contracts, it found 16 valued at $1 million or more. In 14 of those, requirements for public posting were not followed because contracting officers “misinterpreted the publicizing policy, believed that publicizing was not a common practice, or were unaware of the policy itself” or said that they “because they lacked time due to the COVID-19 pandemic or did not request a waiver from publicizing.”

It also found instances in which contracting officers did not ensure that their evaluations and noncompetitive procurement requests were complete or consistently uploaded into a tracking system. “Additionally, documents were misplaced or missing” for reasons including increased workloads due to the pandemic and that “some internal business partners who originated them lacked the knowledge or experience to gather the necessary information to correctly complete the documents.”

“Publicizing noncompetitive contracts awards as required informs the public of unique Postal Service requirements when competition is not used,” said the IG, and “ensuring evidence of required documents and reviews is maintained is important to support proper awarding of noncompetitive contracts. Vetting for past performance and financial capability as well as price reasonableness reduces supplier fulfillment risk and risk of overpayment for goods and services.”

Postal management generally agreed with the resulting recommendations although it took issue with how the IG characterized examinations of a contract’s reasonableness.

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