First Look

Growing frustrations puts GSA on hot seat to fix the transition to UEI

Rep. Gerry Connolly (D-Va.), chairman of the Oversight and Reform Subcommittee on Government Operations, wrote to GSA on July 15 seeking answers to why the tran...

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The General Services Administration is once again struggling with a major systems modernization project, causing an increasingly high level of frustration among vendors and grantees. Now, a powerful congressman is demanding answers about why three months into the transition to the new way for vendors to identify themselves for federal contract or grant awards, GSA hasn’t resolved serious issues with the system.

Rep. Gerry Connolly (D-Va.), chairman of the Oversight and Reform Subcommittee on Government Operations, wrote to GSA on July 15 seeking answers to questions about the transition to the Unique Entity Identifier from the DUNS number. The UEI is a 12-character alphanumeric identifier that is owned and managed by the government. It connects agencies and companies throughout the federal award lifecycle whether it’s writing a contract or managing a grant.

“According to many of my constituents, they have encountered significant difficulty in migrating their existing contractor accounts into the new framework, jeopardizing their businesses and their ability to pay their workers. I write to request information on GSA’s transition to a new Unique Entity ID (UEI) and to determine whether GSA is providing all necessary assistance to the federal business partners federal agencies rely on every day,” Connolly wrote in the letter obtained by Federal News Network. “I have heard from constituents who have struggled to transition to the new unique identifier — and in some cases were removed entirely from the GSA online system. Moreover, when seeking help and assistance from GSA, these government partners were often provided links to unhelpful online frequently asked question pages or stuck on telephone calls for hours with customer service representatives who were unable to help troubleshoot the problems.”

GSA kicked off the transition to the UEI on April 4, promising it had learned the hard lessons from previous system modernization efforts like move to SAM.Gov that initially stumbled.

But the problems with obtaining a UEI number, the lack of clear and urgency response from GSA and the long wait times at the call center are culminating as agencies enter the fourth quarter buying season.

Stephanie Kostro, the executive vice president for policy for the Professional Services Council, an industry association, said many of the problems fall into two buckets.

“One is a registration issue. If you tried to update your banking information, like you switched banks or are using a new account, you apparently have to deactivate your account and reactivate it. But the way the validation system works is if you have a typo or forget a comma or try to insert a suite or room number but it doesn’t match with state corporation registration, it will get rejected. And once you get rejected, you are no longer in the system and no longer eligible for awards or payments,” she said. “The second category are the trouble ticket submissions. We have heard that there are some tickets are now 12 plus weeks old without resolution. It doesn’t seem like GSA is identifying the issues and resolving them quickly. When you have something for 12 weeks like a small business not getting paid, this is a huge issue.”

Fumbled the April 4 launch

These issues come after GSA already fumbled the April 4 launch when it overlooked a rule in its random number generator for UEI that prevented it from compiling curse words as part of the generator. Federal News Network obtained a list of about 10,000 UEI numbers that had to be changed because they included words like “fart” — 14 of them did, by the way — and other “not appropriate for work” words, such as 34 instances of the “F” word.

GSA acknowledged the challenges and is promising to address the UEI transition issues.

Dave Zvenyach, the deputy commissioner of GSA’s Federal Acquisition Service, said in an email to Federal News Network that fixing the UEI transition is a top priority.

“Although we are making progress, we know there are entities who are waiting for their case to be resolved. Resolving their specific, individual cases is paramount for us. And we will not let up until entities can register in SAM in a predictable, timely basis,” he said. “We are working to address each ticket as quickly and efficiently as possible and to improve the new system for both new and renewing entities. We are working with other federal agencies to identify opportunities to reduce the impact on entities affected by this process.”

A GSA official said the UEI transition problem is impacting about 20% of all vendors who have to through a manual review of their request. The official said overall about 200,000 companies have made it through the validation process.

The government’s move away from DUNS numbers will end a 40-plus-year relationship with Dun & Bradstreet where the government has spent hundreds of millions of dollars to use the proprietary system to identify companies.

In March 2018, GSA awarded Ernst & Young a five-year, $41.7 million contract to run the UEI initiative. Ernst & Young will provide services to validate the identity of each entity (company, individual, organization, etc.) wanting to do business with or receive assistance from the government, GSA stated in a release. GSA said the contract will reduce unnecessary duplication across the government by ensuring individual agencies do not have to separately contract for these services, but will instead receive the service by way of

Missed opportunities, delayed invoices

While few may have argued with the move away from DUNS, contractors and grantees are frustrated with how the transition is going and the time GSA is taking to resolve the UEI issues. Experts say the UEI transition problems may be causing great harm to large and small firms alike.

Federal News Network learned from a contracting officer at the Defense Department, who requested anonymity because they didn’t get permission to speak to the press, that they have a small business who is owed $400,000 but can’t get GSA to resolve their UEI issue.

Another small business in the professional services sector is waiting on a payment of more than $200,000 and learned that an agency customer wanted to issue them a task order, but couldn’t because of their UEI situation.

“We thought we did everything we were supposed to do, but when our UEI was assigned to us, it must have been assigned to us using the actual name of company versus the way we had been referred to over the last decade in federal systems,” said one industry executive, who requested anonymity so as not to make GSA mad. “It’s a self-created problem by GSA and we are just in this caught pattern of calling the contact center at GSA and they will send an email, but they will not put you in touch with anyone who can solve the problem. It’s an obtuse process to resolve this current situation and we are flying blind right now.”

And grantees are unable to provide humanitarian and other aid despite the U.S. Agency for International Development or the State Department awarding the grant because of the UEI delays.

Cynthia Smith, director of government affairs and advocacy at Humentum, a global nonprofit working with humanitarian and development organizations to improve how they operate and to make the sector more equitable, accountable, and resilient, said she knows of projects in Turkey and Jordan that are delayed because local sub grantees can’t get UEI numbers.

“We also know of cases where have local partners have prepared for and worked with large international non-government organization to prepare bid and was barred at the last minute because they couldn’t get the UEI number resolved,” Smith said in an interview with Federal News Network. “We are shutting out those who we say are important to advance the local agenda of this administration.”

Robert Shea, the national managing principal for public policy at Grant Thornton, said his company was able to resolve its UEI issues in a matter of weeks, but the impact on companies is real.

“During the time you are figuring this out, you can’t get paid, you can’t access your Contractor Performance Assessment Reporting System (CPARS) ratings and that could significantly damage ongoing procurements because you can’t access, review or appeal CPARS ratings,” he said. “It seems intuitive that you would test bunch of different scenarios before going live with a system that impacts every vendor of the largest buyer in the world.”

Call center, response backlog

The biggest complaints are GSA’s lack of response to the entire situation.

PSC’s Kostro said GSA suggested its members contact the ombudsman with urgent requests.

An email from PSC to its members, which Federal News Network obtained, recommended that when companies reach out to the ombudsman they should “Please include: (1) the legal name of the entity; (2) the UEI number; (3) the FSD ticket #(s); and (4) a summary of the issue(s), which may include any urgencies (e.g., not getting paid, not being able to bid). Please do not submit documentation with personal identifiable information (PII), financial, or other confidential information to the Ombudsman’s office.”

Humentum’s Smith said her members have been told to work through their customer agencies like USAID and State and ask them to bring urgent problems to GSA, especially those impacting new entrants into the federal market.

“GSA’s response been highly inefficient and not proving effective. They need more communication and to offer more proactive channels to address the urgency of the situation,” Smith said. “It would be great to see that type of reflection of awareness of this problem. Because these really do have real life and death consequences. We need a greater window into their strategy for clearing the backlog.”

Roger Waldron, the president of the Coalition for Government Procurement, said in an email to Federal News Network, said GSA needs to do more to address the UEI transition issues.

“The transition hiccups are real, and the potential impact on contractors can be catastrophic, as it can prevent them from competing for new requirements or even getting paid for work they have performed. Regardless of whether it involves a relatively small percentage of contractors, the fact that the impact can be so severe should prompt an all-hands-on deck response from GSA,” he said. “In response to UEI challenges, effective communication from GSA is vital. The agency needs to increase the pace and tempo of messaging to the procurement community on the steps being taken to address the current situation.”

Zvenyach said as GSA continues to make progress in fixing the UEI transition, it will make sure the time frame is more transparent and visible to everyone.

“Our goal as an agency is to make it easy for businesses, nonprofits, other governmental agencies and partners to do the critical work of government – and these validation issues have made it harder for too many organizations. We are doing all that we can to resolve these issues as quickly as possible and will continue to push for better outcomes for our partners both inside and outside the government,” he said.

GSA says as of early July it has resolved 81% of the trouble tickets and continues to reduce the backlog and shorten the time it takes to register in

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