White House Announces First Wave of Federal Contracting Reforms

The White House on July 29 formally unveiled contracting and workforce reforms that are designed to save the taxpayers at least $40 billion a year. The reforms, released by the Office of Management and Budget (OMB), focuses on three areas: improving acquisition, managing the multi-sector workforce, and contractor performance information. Previously, President Obama established in a March 4 memorandum his principles for contracting reform, and charged the OMB with identifying the best approaches to accomplish his goals. The guidance requires agencies to reduce contracts by a minimum of seven percent, with special focus on "high-risk" contracts, such as non-competitive contracts and cost-reimbursement contracts. The guidance also requires agencies for the first time to track contractor performance through a new unified database, the Past Performance Information Retrieval System (PPIRS) located at www.ppirs.gov. The White House reports that Federal agencies will be able to check on a contractor's past performance before signing a new contract with it. OMB will be monitoring their compliance with this requirement and will be publicly release statistics on agency compliance. The guidance on managing the multi-sector workforce lays out a new framework for managing the workforce that evaluates all the functions an organization performs to assess if an agency has achieved the best combination of public and private labor resources to serve the American people. Agencies will be required to pilot this new framework by examining at least one program, project, or activity where the agency has concerns about over-reliance on contractors. A second phase of contracting guidance is scheduled to be released in September. This next phase will focus on maximizing competition, choosing appropriate contract types, building the capacity of the federal acquisition workforce, and clarifying when outsourcing is appropriate. AGC will continue to engage with key Administration decision-makers and contracting leaders on Capitol Hill as these issues further develop. For more information, please contact Marco Giamberardino at (703) 837-5325 or giamberm@agc.org.