This column was originally published on Roger Waldron’s blog at The Coalition for Government Procurement and was republished here with permission from the author.
Just last month, the Biden Administration released its vision for the President’s Management Agenda. The PMA focuses on three priorities: (1) strengthening and empowering the federal workforce; (2) delivering excellent federal services and improved customer experience; and (3) managing the business of government to Build Back Better. Significantly, under priority three, the Biden administration highlights the role of the acquisition system in building back better. The PMA seeks to foster “lasting improvements in the federal acquisition system to strengthen the U.S. domestic manufacturing base, support American workers, lead by example toward sustainable climate solutions, and create opportunities for underserved communities.”
Given the Coalition’s mission of promoting common sense in government procurement, it is gratifying to see the administration’s recognition of the central role the federal acquisition system plays in meeting customer agency missions on behalf of the American people. As federal senior executives ask the acquisition system and their industry partners to do more to support the Build Back Better initiative, it will be critical to identify quick fixes, reforms, policies and strategies that increase the efficiency and effectiveness of the acquisition system for customer agencies and contractors. Recognizing the value offered by the private sector here, to be effective, as noncommercial requirements are added to the acquisition system, approaches must be developed to reduce burdens on that sector. Obsession with what Professor Steve Schooner has long called “the tyranny of low price” is not in the long-term best interests of customer agencies, industry partners and the nation.
As the federal government and its industry partners work together to act on opportunities to improve the efficiency and effectiveness of the acquisition system, today marks the beginning of a series of Build Procurement Back Better blogs. These blogs will highlight potential quick fixes, reforms, policies and strategies that can reduce burdens, clarify procedures and policies to promote cost-effective best value solutions for customer agencies and their industry partners.
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The initial focus of the Build Procurement Back Better blogs will be interagency contracting and GSA’s governmentwide acquisition programs. With regard to GSA’s Multiple Award Schedules (MAS) program, start with the foundation; specifically, the MAS RFP and a confusing and contradictory statement/instruction regarding price analysis.
Section III of the MAS solicitation’s instructions to offerors (Refresh 9):
Applicable to both product and service offers. GSA’s pricing goal** is to obtain equal to or better than the offeror’s most favored customer (MFC) pricing under the same or similar terms and conditions. GSA seeks to obtain the offeror’s best price based on its evaluation of discounts, terms, conditions, and concessions offered to commercial customers. However, offers that propose most favored customer pricing that is not highly competitive will not be determined fair and reasonable and will not be accepted. The U.S. Government Accountability Office has specifically recommended that “the price analysis GSA does to establish the government’s negotiation objective should start with the best discount given to any of the vendor’s customers.”
**This requirement does not apply to offerors/contractors that will be participating in TDR.
See SCP-FSS-001 Instructions Applicable to All Offerors
There are multiple points to unpack in this statement/instruction. The first sentence addressing the pricing goal generally reflects the underlying General Services Acquisition Regulation (GSAR) governing MAS price negotiations. To provide full context to the sentence, however, the best practice would be to include the citation to the applicable regulation, GSAR 538.270. The second sentence stating the goal of obtaining the offeror’s best price to commercial customers unfortunately contradicts the first sentence and the underlying GSAR. Worse, the third sentence essentially inserts a new price analysis requirement that the negotiated prices must be “highly competitive” to be fair and reasonable. To the best of our knowledge, there is no regulatory definition of “highly competitive,” but in any case, pursuing this goal is especially challenging when MAS contracts only provide a $2500 guaranteed minimum with the subsequent opportunity to compete for work at the task order level. Competition takes place at the task order level, as statutorily and regulatorily intended, and it is at that point where requirements are definitized sufficiently to allow for meaningful competition. Further, the final sentence including a GAO quote is confounding. GSA is responsible for implementation and management of its MAS pricing policy, not GAO. Moreover, the GAO statement is provided without any context, leaving stakeholders to wonder about its origin and utility. There is not even a citation or further reference to the report that included the statement, which is especially troubling as the GAO statement/quote contradicts the first sentence of the instructions, along with the underlying GSAR price regulations.
A positive, quick fix for GSA would be to revise and clarify this language. Given it’s confusing and contradictory, it is no wonder that one of the consistent observations regarding the MAS process is the lack of consistency from acquisition center to acquisition center and even from contracting officer to contracting officer within an acquisition center. Addressing this language consistent with the underlying regulation, however, would be only a first step. The harder work, focusing on the management, training and education of the MAS acquisition workforce supporting contract negotiation and administration, would have to follow. In this regard, whether through direct engagement, forums or reverse industry days, Coalition members look forward to working with GSA on improving the efficiency and effectiveness of the MAS program. Working together we can Build Procurement Back Better.