March 14, 2017 —
We determined whether the U.S. Army’s single-award, indefinite-delivery indefinite-quantity (IDIQ) contracts were properly justified. In addition, we determined whether associated task and delivery orders were within the scope of the contracts in accordance with Federal and DoD procedures.
The Army awarded 43 single-award IDIQ contracts with a value of $29.8 billion from October 1, 2014, through December 31, 2015. We reviewed a nonstatistical sample of seven single-award IDIQ contracts, valued at $4.1 billion, awarded by two Army Contracting Command (ACC) locations (Aberdeen Proving Ground [APG], Redstone Arsenal [RSA]) and the Army Corps of Engineers (Huntsville) from October 1, 2014, through December 31, 2015.
Contracting personnel at the ACC-APG, ACC-RSA, and U.S. Army Corps of Engineers (Huntsville) justified the seven contracts we reviewed, valued at $4.1 billion, as single-award IDIQ contracts, and issued 20 task orders consistent with the scope of the associated contracts. However, an ACC-APG contracting officer did not support one contract (W91CRB-15-D-0022), valued at $192 million, with a required Determination & Findings (D&F) document1 because ACC-APG officials wrongly believed the Justification and Approval (J&A) document,2 which was signed by the senior procurement executive, was sufficient. The J&A document contained some of the content required for a D&F document, such as the name of the contracting activity, the description of action, and the description of supplies and services. However, the contracting officer did not cite the specific rationale in the J&A document that was essential to support the D&F exception as required by the Federal Acquisition Regulation. As a result, ACC-APG contracting officials did not ensure that the D&F document was reviewed, so there is a risk that this contract should not have been awarded to a single source, which eliminates task order competition and could increase contract costs.
In addition, Deputy Assistant Secretary of the Army (Procurement) (DASA[P]) and ACC-RSA officials did not properly process single-award IDIQ contracts because the Army did not have uniform guidance to prepare, review, and submit D&F documents for single-award IDIQ contracts. Specifically:
- DASA(P) officials could only verify that they submitted two of six D&F documents for the contracts reviewed in a timely manner to the Director, Defense Procurement and Acquisition Policy (DPAP). DASA(P) officials could not explain the lack of compliance with the Defense Federal Acquisition Regulation Supplement.
- ACC-RSA officials supported contract W58RGZ-15-D-0048 with a D&F document that cited two Federal Acquisition Regulation exceptions, only one of which was correct, and they could not explain why this error occurred.
As a result, the reports to Congress and DPAP related to tracking the compliance with the law in section 843 of The National Defense Authorization Act for FY 2008 could have been incomplete or inaccurate.
We recommended that the DASA(P):
- issue internal guidance addressing the preparation, review, and submission of a D&F document for single-award, indefinite-delivery indefinite-quantity contracts; and
- submit the D&F documents for three single IDIQ contracts (W56KGY-16-D-0001, W91CRB-15-0018, and W912DY-15-D-0099) to the Director, Defense Procurement and Acquisition Policy.
We recommended that the ACC-APG contract officials prepare and submit for approval a D&F document for contract W91CRB-15-D-0022.
Management Comments and Our Response
The Acting DASA(P) disagreed with the recommendation to issue internal guidance addressing the preparation, review, and submission of D&F documents for single-award IDIQ contracts, asserting that, if followed, existing guidance is enough. However, the existing guidance (Federal Acquisition Regulation, Defense Federal Acquisition Regulation Supplement, and Army Federal Acquisition Regulation Supplement) does not describe the internal controls and processes needed to ensure the effective preparation, review, and submission of D&F documents for single-award IDIQ contracts. Therefore, this recommendation is unresolved. We request that DASA(P) provide comments to the final report by April 14, 2017, specifying how DASA(P) will ensure internal compliance with existing guidance, or alternative actions, to make sure that D&F documents for single-award IDIQ contracts are effectively prepared, reviewed, and submitted.
The Acting DASA(P) agreed to and submitted the D&F documents for the subject contracts to DPAP. We verified that the documents were submitted to and received by DPAP; therefore, the associated recommendation is closed.
The Acting Executive Director, ACC-APG, agreed with the recommendation to submit the D&F document for approval by March 31, 2017; therefore, the recommendation is resolved. We will close this recommendation once ACC-APG officials provide and we validate information showing that the D&F documents were submitted for approval.
1 A D&F document is a special form of written approval by an authorized official that is required by law or regulation as a prerequisite to taking certain contract actions.
2 A J&A document is required to justify and obtain appropriate level approvals to contract without providing for full and open competition.