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Report | June 17, 2016

DoD Generally Provided Effective Oversight of AbilityOne® Contracts



We determined whether DoD effectively provided oversight of AbilityOne® contracts. We conducted this audit in response to a request from the Senate Armed Services Committee. AbilityOne provides people who are blind or have significant disabilities with employment opportunities in the manufacture and delivery of products and services to the Federal Government. We reviewed a nonstatistical sample of 39 DoD contracts with AbilityOne contractors, valued at $579.3 million (Federal Procurement Data System-Next Generation value), out of 203 contracts, valued at $2.3 billion.


DoD generally provided effective oversight of 39 AbilityOne contracts valued at $594.6 million (contract awarded value including options). For all 19 service contracts, valued at $431.3 million, Army, Navy, and Air Force program and contracting personnel prepared quality assurance surveillance plans (QASPs) that met Federal Acquisition Regulation requirements. Further, contracting officer’s representatives (CORs) were in general properly trained and designated, and in general they properly documented surveillance. However, one COR conducted surveillance based on customer complaints when the QASP stated the method of assessment was periodic surveillance. This occurred because the COR used a QASP created from a standard template that was not updated for the type of contract used for this procurement. Another COR did not document or conduct surveillance in accordance with the QASP. The COR stated this occurred because the command did not have enough people to perform surveillance. Finally, one contracting officer did not prepare a letter designating the COR on one contract.

For 13 supply contracts, valued at $135.9 million, of 20 supply contracts, Army and Defense Logistics Agency (DLA) contracting officers assigned quality assurance representatives who inspected and accepted the products procured. For the remaining seven contracts, valued at $27.4 million, DLA contracting officers obtained a material receipt acknowledgement when DoD personnel received the supplies, in accordance with a DLA Directive. No DLA personnel, customers, or end users notified the contracting officers of any problems with the supplies for these contracts.

As a result, DoD received the services and supplies, procured in accordance with section 8504, title 41, United States Code, provided by nonprofit agencies that employed workers who are blind or have significant disabilities.

However, contracting officers at Army Contracting Command−Rock Island, Illinois; Air Combat Command Acquisition Management and Integration Center, Newport News, Virginia; and DLA Troop Support, Philadelphia, Pennsylvania, awarded three contracts, valued at $37.9 million, including options, for services and supplies not on the Procurement List—the list of products and services, under the AbilityOne Program, that are required sources for the Government. This occurred because the contracting officers either relied on the central nonprofit agencies’ direction or the previous procurement as evidence that the services and supplies were on the Procurement List. As a result, the contracting officer for DLA Troop Support Philadelphia should have followed the competition rules in Federal Acquisition Regulation Part 6 to potentially save funds on the supplies procured, valued at $1.2 million.


We recommend that the Director, Defense Procurement and Acquisition Policy, issue a policy memorandum requiring DoD contracting officers to ensure all products and services procured under AbilityOne are on the AbilityOne Procurement List before contract award, update existing training to clearly define DoD contracting officers’ roles and responsibilities when awarding contracts under AbilityOne, and require that all contracting personnel planning to procure under AbilityOne complete the updated AbilityOne training.

Management Comments and Our Response

Comments from the Director, Defense Procurement and Acquisition Policy, addressed the specifics of the recommendations, and no further comments are required.

This report is a result of Project No. D2015-D000CG-0257.000.