By Neil Gordon
Mark Thompson posted an interesting federal contracting-related tidbit last week on TIME’s national security blog, Battleland. He looked at a list of recent Department of Defense contract awards and noticed that many of them had received only one bid.
Of the 35 contracts in the list that Thompson reviewed, 20, worth a combined $257 million, either solicited or received just a single bid. On many of them, including contracts awarded to big players such as Computer Sciences Corporation (CSC), General Dynamics, Raytheon, and BAE Systems, the government solicited only one bid. Federal agencies are required to award contracts on the basis of full and open competition but are permitted to award non-competitive contracts in certain situations. The U.S. Army awarded 19 of the 20 contracts, which makes us wonder if the Army is perhaps taking its old “Army of One” slogan a bit too literally when it comes to contracting.
This DoD contract award announcement is by no means an aberration. On most of the announcements, you will find at least a few solicitations in which only one bid was solicited or received. According to USAspending.gov, DoD has one of the lowest rates of contracting competition of all the agencies. DoD has spent more than $3.7 trillion on contracts since fiscal year 2000, about 56 percent of which was competitively awarded. In contrast, the departments of Energy, Transportation and Health and Human Services have competition rates well over 70 percent, while the departments of Education and Agriculture both exceed 80 percent.
Of course, USAspending’s competition numbers are somewhat undermined by the federal government’s ridiculously broad definition of competition. For example, contracts under which the work is carried out under indefinite delivery, indefinite quantity task orders -- most notably, the LOGCAP III worldwide logistics contract awarded to KBR in 2001 -- are counted as competitive, even though the task orders are not competitively bid. Furthermore, DoD estimates that at least $55 billion of the contracts it awards every year involve what it calls “ineffective competition,” or solicitations publicized under full and open competition that receive only one bid.
DoD, to its credit, has been working to improve its contracting competition practices. DoD’s Better Buying Power initiative places an emphasis on maximizing opportunities for competition, such as providing additional time for bidders to respond to solicitations that receive only one offer. As that defense contract award announcement shows, however, there is still plenty of room for improvement.
POGO has long advocated for increased competition in federal contracting. It is only through full and open competition that the government can be assured of acquiring the best quality goods and services at the best prices. Competition also acts as a check on fraud, waste and abuse. The government will be less tolerant of poorly performing contractors if it has a pool of viable alternatives from which to choose.