AI effort to improve contractor performance ratings stalls

Contractor performance ratings remain stuck.

The General Services Administration made its first set of awards for the next great governmentwide contract.

And it’s the federal fourth quarter buying season.

These are some of the story lines in this latest edition of As the Procurement World Turns.

Agencies are expected to spend more than $200 billion on acquisition programs over the last quarter of fiscal 2024.

Bloomberg Government estimated that 40% to 60% of all federal procurement spending happens in the federal fourth quarter. At the same time, BGov also projected a drop in overall spending this year.

While the focus is on getting money out the door for many agencies, there are a host of policy and programmatic updates that will impact federal acquisition over the next several months.

First off, the initiative to revamp the process for contractor ratings is grounded at the worst and crawling forward at best.

There are two reasons why improvements to the contractor performance assessment ratings (CPARs) remain delayed.

First, the case before the Federal Acquisition Regulatory Council hasn’t moved since 2021. The idea, the change FAR Part 42, would make it easier for a third-party vendors to access these assessment records.

The delay in the FAR case led to the second reason for the delay in improvements to CPARs. The Homeland Security Department ended its pilot to use artificial intelligence for CPARs.

Polly Hall, the DHS senior advisor to the chief procurement officer and former executive director of the Procurement Innovation Lab, which ran the AI CPARs pilot, said the test proved out the capability of using this technology to identify relevant records and information. She said the challenge was how to access the CPARs system where the data lives.

The pilot only used “fake” or anonymized data because of security and privacy concerns.

Hall said the current CPARs system is far from being user friendly and right now there is no path to modernize it.

She said the technology and lessons learned from the pilot aren’t going to waste, however.

“We recognized another use case for front end market research. We are using open source information so contracting officers can shape engagements with industry,” Hall said. “Even if the FAR Case moves forward, we would have to relook at the technology and systems and make sure it’s still right and appropriate. AI has come a long way in four years.”

An Office of Management and Budget spokesperson said the FAR case is on pause to allow further analysis of security considerations, such as roles and responsibilities for the lifecycle management of the data.

“This pause of the regulatory case has not stopped other past performance improvement efforts, that do not involve third party access to the system,” the spokesperson said. “The results of the pilot will be helpful as we evaluate security considerations regarding access and as we consider ways to leverage AI with appropriate risk-management safeguards as envisioned by Executive Order 14110, OMB Memorandum M-24-10, the AI in Government Act and the Advancing American AI Act.”

Ken Susskind, the CEO of GovConRx, who has been a strong advocate over the last few years of reforming and improving CPARs, said the current approach has little to no value because agencies rate most vendors satisfactory. He said the way the government does CPARs hasn’t changed in 30 years.

“The bottom line is there is so much value in the CPARs system and capabilities that it’s sad it’s not available to government and industry,” Susskind said. “The data could help contracting officers make better buying decisions but also help companies improve their chances of winning. But if everyone is rated satisfactory, then CPARs has little to no real value.”

Mike Smith, a former director of strategic sourcing at DHS and now executive vice president at GovConRx, said with the successes of the DHS and other pilots, he hoped the FAR Council would take up this project and support CPARs reforms.

Without the FAR case moving forward, OMB says it still wants agencies to use past performance as an effective motivator of better contractor performance.

The spokesperson said OMB’s new Circular A-137 on strategic data management will provide an “important opportunity to evaluate CPARs data and consider better ways of aggregating, analyzing and presenting performance information.”

OMB says these actions should help contracting officers better understand current market factors and predict which vendor may offer the best value to the government.

OMB says it is working with agencies to prioritize their acquisition data management needs.

In the meantime, OMB also says it supports agencies who want to test and share better ways of conducting intake to, and output from, CPARs.

“With respect to improving intake, for example, several agencies have encouraged their workforce to seek contractor self-assessments that can result in increased communication between the parties during the contract and prior to the agency’s validation of past performance in CPARs,” the spokesperson said. “The General Services Administration has issued guidance to promote self-assessments and created a Notifications or Reminders Automation (NORA) bot based on robotics process automation (RPA) technology that reminds contractors to generate the performance self-assessments. OFPP recognized the acquisition professional behind the bot in 2022.”

Additionally, OMB pointed to other agencies who have used a quality assurance surveillance plan to evaluate performance on task orders and incorporated the information into CPARs, rather than inputting separate ratings that are conducted independent of the surveillance plan.

And at least one agency has piloted a “CPARS lite” process involving an evaluation for simpler commercial buys that helps to promote performance assessment feedback on smaller dollar buys.

GSA kicks off OASIS+ awards

GSA made the first set of awards under the OASIS+ professional services multiple award contract on Tuesday.

GSA picked 1,383 small businesses across seven domains, including management and advisory services, logistics services and technical and engineering services, for the tentative awards. GSA still must deal with possible size status protests and do final responsibility determinations.

GSA also will make awards under the OASIS+ unrestricted version and the socio-economic pools like 8(a) and women-owned small businesses over the next several months.

The 10-year OASIS+ contract replaces the popular OASIS multiple award contract that has seen more than $70 billion in obligations since 2015.

The first set of awards come about eight months since vendors submitted bids.

GSA has been working on the follow-on to the highly successful OASIS multiple award contract since March 2021. The effort included 23 program updates to draft requests for proposals (RFPs), three industry days with more than 3,000 participants and more than 1,900 questions between the draft and final solicitations.

New small business rules

Along with GSA’s OASIS+ awards, vendors are focused on two other large governmentwide acquisition contracts. Bids for NASA SEWP VI are coming due Aug. 28, though another extension is not out of the question.

Meanwhile, the National Institutes of Health IT Acquisition and Assessment Center (NITAAC) remains mired in protest purgatory over its CIO-SP4 program. It extended the current CIO-SP3 contract for at least a sixth time. Agencies now can place orders through April 2025.

Even if the FAR Council isn’t moving out on the CPARs rule, it has remained busy finalizing a rule on allowing protests of small business set-aside task orders under certain multiple award contracts. The rule, which takes effect Aug. 29, provides processes and procedures for filing size and socioeconomic status protests associated with multiple-award contracts that are partially set-aside for small businesses or that include reserves for small businesses and orders placed under multiple-award contracts, with the exception of orders and blanket purchase agreements placed under GSA’s schedule contracts.

Another proposed rule to watch, and the Small Business Administration will be holding several listening sessions around the country, is one that would amend the 8(a) Business Development program and size regulations. The proposed rule would consolidate and redesignate the separate recertification requirements for SBA’s size, 8(a) BD, HUBZone, woman-owned small business and service-disabled veteran-owned small business programs to a new section to reduce confusion and to ensure consistent application of the size and status recertification requirements.

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