OMB bans most new contracts for desktops, laptops

The Office of Management and Budget is squashing any new contracts for computers by civilian agencies.

OMB released new guidance to agencies Oct. 16 prohibiting civilian agencies from buying desktop or laptop computers off any contract except from one of three governmentwide acquisition contracts—NASA SEWP, the General Services Administration’s IT Schedule 70 or the National Institute of Health’s Chief Information Officer-Commodities and Solutions (CIO-CS).

“These vehicles were awarded according to category management principles, an approach to better buying and managing the federal government’s vast goods and services more like a single enterprise,” wrote federal CIO Tony Scott and Anne Rung, administrator of the Office of Federal Procurement Policy, in a new blog post. “These solutions support the government’s goals of increasing opportunities for small businesses as small business participation rates on these three solutions exceed the overall small business participation on all other laptop and desktop vehicles across government. Moreover, annual evaluations of the performance of these solutions will ensure they continue to result in greater efficiency, effectiveness, and savings for the civilian agencies, and this list may be adjusted as appropriate.”

OMB says its research found agencies awarded more than 10,000 contracts in 2014 worth more than $1.1 billion. OMB says this resulted “in reduced buying power, inefficient duplication of contracts, and very little transparency into prices paid.”

The Workstation Category Team (WCT), led by NASA under the category management initiative, found 80 percent of all desktops or laptops agencies bought could be met through five standard configurations.

“Standardizing common requirements also ensures that we are moving the government from ‘nice to have’ to ‘need to have’ to drive down costs, we are improving our interoperability and security profile, and we can more easily compare pricing information,” the memo stated. “This analysis further showed that agencies were paying a wide variety of prices for these standard offerings and using different terms and conditions, which highlighted the need for a more coordinated approach.”

OMB found that agencies spent between $450 to $1,300 for laptops with the same configurations.

Instead, the WCT has come up with two laptop and three desktop configurations—standard and upgraded—that should satisfy most agency needs.

GSA released a request for information earlier this year for the laptop desktop program. The RFI asked for feedback on five standard desktop and laptop configurations based on the feedback it received earlier this year from agencies and vendors.

The new policy lets agencies continue to use existing contracts through the current base year or option period, but must analyze the terms, conditions, pricing, fees and savings under the deal six months prior to the new option period. Agencies must provide this information to OMB for approval.

“Eighteen months prior to any recompetition of these solutions, the agency must submit a business case to OMB that outlines how the agency will transition to the identified vehicles above or how they will make their solution available governmentwide, if applicable (transition plan requirements are provided below),” the memo stated. “Agencies with bureauwide agreements, or agencies that cannot meet the category management exemption criteria…must transition to the CMLC-approved vehicles by Oct. 1, 2016.”

Agencies can get a waiver if it:

• Appoints an agency category lead for laptops and desktop, who will also actively participate in the WCT.
• Measures and report rates of compliance by bureau, and monitor and address noncompliant spend outside of the mandated vehicle.
• Posts the agency’s mandatory use policy and critical contract data, including terms and conditions, and maintain prices paid on the Acquisition Gateway within 90 days of issuance of this policy.
• Complys with additional guidance identified by OMB or the Category Management Leadership Council (CMLC) to ensure that the agencywide vehicle continues to deliver the maximum benefit to the agency and that best practices and pricing are shared widely among the acquisition and IT community.

Under this effort, agency CIOs also will have to adopt a regular refresh cycle—something similar to 25 percent every four years or 20 percent every five years.

“Uniform refresh plans allow agency leadership to budget for laptops and desktops in a more strategic and predictable manner and allows the support team to more effectively plan for device replacement, sanitization and final disposition,” the memo stated. “Agencies should focus the bulk of their acquisition of laptops and desktops on publicized buying events to maximize the government’s collective buying power. A best practice is to host semi-annual buying events where requirements across agencies are consolidated to leverage buying and drive down costs, and the WCT will require this practice for GSA Schedule 70, NITAAC CIO-CS, and NASA SEWP. Furthermore, the WCT will work with GSA to create tools on the Acquisition Gateway to help organizations consolidate requirements to better leverage their spending. Agencies shall, to the maximum extent practicable, participate in these buying events.”

OMB recognizes that it can’t drive 100 percent adoption rate across the government because some agencies have unique needs. Scott and Rung, therefore, have set a goal having agencies buy 75 percent of all laptops and desktops through the three approved contracts.

OMB set a deadline of Feb. 28 for agency CIOs and chief acquisition officers to develop a plan for how their agency will meet this goal.

“Working together, the CIOs and CAOs shall develop short transition and implementation plans that address both the new technical and new acquisition requirements set forth above,” the memo stated.

This memo comes as OMB announced category management would become a cross-agency priority goal. As part of that effort, OMB set metrics such as reducing the number of IT contracts for hardware by 20 percent, and 10 percent each for software and telecommunications.

GSA and OFPP said they plan to increase the percent of spending under the category management for common goods and services by 40 percent by the end of 2016 and 80 percent by the end of 2019.

This memo is likely to be the first of several coming this fall. OMB has said previously that an interagency team led by OFPP, GSA and the Defense Department will develop a strategic plan to increase the number of enterprisewide software agreements across government.

This concept of contract consolidation extends to law as well. Under the Federal IT Acquisition Reform Act, the Federal Acquisition Regulations Council will develop a new rule requiring contracting officers to justify in their contract file as to why they aren’t use an existing governmentwide strategically sourced contract.

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