Hallock said the Army will pay a fee of 0.1 percent instead of what other agencies pay to use OASIS, 0.75 percent, meaning the service will get a significant discount. The Army sends hundreds of millions of dollars annually to GSA in exchange for using their assortment of contracts. A reduced fee of 0.65 percent means the Army can use that money for mission-critical necessities.
“The first task orders have already come through. We already are using OASIS,” Hallock said during a press briefing on the MOU at GSA headquarters in Washington. “What’s nice about the arrangement we agreed upon is going back to Jan. 1, I think, those that already are done prior to the signing of the agreement as of Jan. 1 fall under the OASIS requirements. We are there. We’re doing it. We’re using it.”
Billions spent with GSA annually
Jim Ghiloni, GSA’s OASIS program executive officer, said the agreement with the Army is one way GSA is trying to relook at how it serves its customers.
“On OASIS this sort of tiered fee structure is a pilot program. It’s one of many things we are looking at across GSA,” he said. “I think you can see there’s a number of initiatives looking at different ways to recover costs. We feel fairly confident this will be successful.
Ghiloni said the goal is to reduce the workload and administrative costs for the Army. He said OASIS also is designed to streamline the acquisition process.
Hallock said he expects the Army will use the professional services category under OASIS the most.
“We have so much of that. A lot of those are the services that support our program managers and program executive officers,” he said. “That’s a big part of our business.”
Hallock said the Army spent 60 percent of its $73.4 billion procurement budget on services in 2014. And of that, more than $3.5 billion was with GSA and $1.8 billion of that was through GSA’s professional services schedules.
The Army’s deal follows a similar one by the Air Force with GSA back in December 2013. The Air Force also promised to spend $500 million on OASIS in its first year.
There isn’t a big difference between the two MOUs except for one took a year longer.
“We vetted this pretty well,” Hallock said. “Poor Jim, I dragged him to our conference with the principle assistants responsible for contracting and told him to ‘take the lashes’ from the group. That was a great process and Jim had all the answers, and that is where we made the decision. It took a while to get all those folks together. And even once we make the decision, consolidating it into a document that approves this took a little bit of time.”
Shuttering duplicative contracts
Hallock adds there’s a second major reason to move to OASIS. For the Army, getting rid of existing and potentially duplicative professional services contracts could mean additional savings.
“There is no mandate at this point to do that. What we are hoping is that this working relationship works so well that people will not give it a second thought when their current contract expires,” he said. “And we will be looking at that from a headquarters perspective that we just don’t let them go. If for some reason this isn’t working, that’s where [GSA’s] Tiffany [Hixson] and I will have lots of dialogue together. I don’t anticipate that, frankly. I think it will work and be a natural thing.”
Hallock said he realizes the push toward OASIS will be new and a change for many contracting officers. But, he said, like any change, the acquisition workforce will have to get used to the new approach to services and a few success stories will be important to get there.
Additionally, Hallock said GSA and DoD are discussing whether they could implement some Defense Federal Acquisition Regulations (DFARs) requirements into the OASIS contract to make it easier for DoD to use the contract. That would be a first for any civilian agency contract.
Hallock also said he believes this agreement will help the Army continue to meet its small business goals. He said the Army has the highest percentage of any of the DoD services or agencies when it comes to small business contracting and he expects the OASIS small business contract to help that even more. In fiscal 2013, the Army awarded 27 percent of all of its procurement dollars to small businesses. The data for 2014 is not finalized.
GSA isn’t currently negotiating with other military services or agencies, nor with any civilian agencies.
But Tiffany Hixson, GSA’s Federal Acquisition Service’s professional services category executive, said she’d like to talk to other agencies.
She says the departments of Homeland Security and Health and Human Services are prime candidates. DHS, for instance, spent about 30 percent of its procurement budget last year with GSA.
Pricing tool almost ready
In the meantime, Hixson said OASIS unrestricted and small business contracts are gaining steam.
Ghiloni said the first task order awards should happen in a matter of weeks under the full and open OASIS contract. Agencies including the Army, Navy, Air Force, Defense Advanced Research Projects Agency, Customs and Border Protection, Interior Department and the Agriculture Department have all issued RFQs against the contract.
Under the small business version, Ghiloni said 30-to-40 awards already have been made by agency customers.
Hixson said GSA is planning more changes to how they deliver professional services in the coming months through the category management and hallways initiative.
“One of the first digital tools we’ve put in the hallway is statement of work library. So best practices we come across, really good statements of work and how do they structure the evaluation criteria, what does their pricing schedule look like, and we will be able to share those things with the larger acquisition community,” Hixson said. “As we work through this from a professional services category executive perspective, if there are things that I need to start flagging for Army buyers, those are some of the thing that we will be able to do through the category hallway.”
She said GSA also will release its first services pricing tool in the coming month or so.
“It’s fairly basic at this point, but it’s a pricing tool that contracting officers can use,” Hixson said. “It’s based on work that we’ve been doing in our schedules environment and we’ll be including OASIS pricing once that starts to come through. We just don’t have enough pricing data to include that at this point. But for today, we’ve got 30,000 labor categories priced out through our schedules contract.”
She said contracting officers can go into the tool to get an idea of the rate of an engineer with a four-year degree and two years of experience.