Congress Acknowledging Federal Contracting Problems

After receiving input from AGC of Washington members and staff in the Southern District and AGC of America the House Armed Services Committee included a provision in the National Defense Authorization Act for Fiscal Year 2012 that will take a long and hard look at competition in construction acquisition programs. Specifically Congress is interested in reviewing the overreliance on the very large Multiple Award Task Order Contracts (MATOC) that limit competition. If you have questions on this topic contact Tim Attebery.

This provision in the bill: Competition in Construction Acquisition Programs

The committee is concerned that the Department of Defense has inappropriately advocated a construction acquisition program that values speed in execution over savings. The committee notes that the Naval Facilities Engineering Command has awarded a global Multiple Award Task Order Contract which may serve to expedite construction processes but also creates barriers to competition increases the overall cost to construction and may aggregate the overall risk to the project. While this contracting approach is appropriate in some emergency situations that require speed in execution the committee believes that this approach is inappropriate for routine construction requirements. The committee is concerned that construction contracts such as the Navy’s global Multiple Award Task Order Contract impede the Department in receiving the best construction contract pricing because it does not allow consideration of locally based task order type construction contracts. Furthermore the committee is concerned that the Department is not complying with the with congressional intent to foster the participation of small business concerns as prime contractors subcontractors and suppliers and may not be in compliance with Federal Acquisition Regulations regarding small business concerns and contract bundling determination and justification. The committee believes that the Department should minimize barriers to competition and ensure the widest participation of construction contractors to the military construction programs in order to ensure best value for the taxpayer. Therefore the committee directs the Secretary of Defense to conduct a review of this issue and provide a report on the findings to the congressional defense committees by October 1 2011. The review shall include as a minimum :( 1) A cost benefit analysis of the regional task order construction contracts compared with a locally based task order contract or a single construction project acquisition process. Such an assessment should include a review of potential construction contractors that are eliminated from competition and the potential savings that would be expected by an expanded contractor field participating in the construction acquisition process ;( 2)An assessment of the programs or policies to determine if there are statutory or regulatory barriers in providing a locally based construction contract ;( 3)An assessment of the Naval Facilities Engineering Command’s Multiple Award Task Order Contract to determine compliance with Federal Acquisition Regulations related to contract bundling and small business considerations; and(4)An assessment on the construction contract bundling definitions to determine whether an expansion of the definition is appropriate to ensure small business equities are adequately protected.