Measure Restricts Contracting Policy

The spending bill would continue a restriction that predecessor bills have imposed on contracting-out studies under OMB Circular A-76 for several years, requiring that for functions employing 10 or more federal employees, the in-house bid must be based on a “most efficient organization” and requiring that bidding contractors show savings of at least 10 percent or $10 million in order to win. It also continues more recent language barring contractors from gaining an advantage by paying less toward health insurance coverage than the government does for federal employees and adds a new similar restriction involving retirement benefits (DoD would be exempt from those restrictions under the bill; similar language affecting DoD might be put in a later appropriations bill covering only that department). The measure also contains new language giving all federal employees the same rights to appeal decisions of contracting-out studies as bidding contractors, while providing expedited appeals in some circumstances. It also would: bar OMB from requiring agencies to study jobs for possible conversion; order that A-76 be rewritten to provide procedures to bring work back in-house that already has been contracted out; and allot only $1 million for a program of using contractors for IRS debt collection, which could effectively kill that program.