On August 22, 2013, GSA’s Federal Acquisition Service (FAS) posted a blog entitled “OASIS: What You Need to Know About GSA’s Plan to Reduce Contract Duplication.”
The blog correctly notes that OASIS can play a positive role in reducing contract duplication by delivering best value, cost effective service solutions for customer agencies. At the same time, the blog’s focus on OASIS as an antidote for contract duplication also highlights the huge, unfilled potential of the GSA Schedules program to deliver best value service solutions to customer agencies and the American people. The blog states that “OASIS takes the GSA Schedules to the next level by combining professional services and IT services into a single source for both commercial and noncommercial needs—and eliminating the unneeded duplication of contracts.”
Ironically, FAS has the opportunity and the authority to take the GSA Schedules program to the next level by incorporating “other direct costs” (“ODCs”) into GSA Schedule contracts. By utilizing the vetted, FAR-based commercial item clauses for acquisition and reimbursement of ODCs, materials and indirect costs, FAS can further enhance customer agencies’ ability to efficiently and effectively acquire complete solutions to requirements under the GSA Schedules program. Currently, the inability of customer agencies to include ODCs, materials and indirect costs on Schedule orders increases contract duplication thereby increasing costs and reducing efficiency for government and industry. The increased costs of contract duplication hit small businesses particularly hard.
Over five years ago, FAR Clause 52.212-4 Alternate I authorizing ODCs on commercial item contracts, went through the formal rule-making process. Currently FAR 52.212-4, Alternate I, is already in many GSA Schedule contracts but remains unavailable for use by customer agencies. This current “ODC disconnect” between the GSA Schedules program and the FAR implementation of ODCs pushes agencies to find alternative solutions. For example, the Department of State could conduct an open market procurement utilizing the commercial item clauses under FAR Part 12 for an IDIQ contract that provides for the inclusion of ODCs, materials and indirect costs for its requirements at the order level. However, if the Department of State wanted to utilize GSA Schedules for a requirement that included ODCs, materials and/or indirect costs, it could not. Contract duplication is the result.
The GSA Schedules program is the largest commercial item contracting program in government, accounting for approximately $40 billion in annual purchases by the federal government. Professional services and IT services account for approximately half that number ($18-20 billion annually). GSA has the opportunity to further leverage the program for customer agencies. GSA has the statutory authority and responsibility for the policies and procedures governing the program. The FAR-based commercial item clauses are there. The market is ready. The contractor community is motivated to work with GSA on this issue to ensure an effective, accountable solution that works for all.
It is time to take the GSA Schedules to the next level for customer agencies and the American people. Let’s work together to enhance competition, increase efficiency and reduce contract duplication. Let’s implement ODCs!