The Office of Management and Budget, after releasing reports recently touting the financial and operational benefits of federal competitive sourcing efforts, has issued a memo announcing plans to seek the repeal of language that mainly emphasizes cost in deciding whether to give federal jobs to the private sector.
The memo – M-06-13- also encourages agencies that are planning competitions to be announced in fiscal 2007 to develop those contests with “cost-technical tradeoff source selections” in mind.
OMB said it was seeking the repeal of section 842a of the fiscal 2006 Transportation-Treasury appropriations bill, which with a few exceptions prohibits an executive agency from outsourcing work performed by more than 10 federal employees without demonstrating via a competition that the contractor would be less costly by an amount that equals or exceeds the lesser of $10 million or 10 percent of the personnel-related costs associated with the agency’s bid.
The conference report for the bill says OMB’s evaluation of the provision’s effect on taxpayer “value” would be weighed when deciding whether to extend the provision in fiscal 2007.
OMB has criticized the provision and said it deters contractors from developing and submitting innovative proposals that could improve the quality of agency operations.
