NDAA 2020 - Contracting Out DCAA and DCMA Functions - Study Required

The House passed its version of the 2020 NDAA (National Defense Authorization Act) late last week. Previously, the Senate passed its own version so now it on to a compromise committee to iron out the differences. And there are some significant differences which will probably make it difficult (but not impossible) to reach a compromise on a final bill. House members offered more than 430 amendments to the NDAA and a large number of those were adopted. In the coming days, we will take a look at some of the procurement related provisions that made their way into the Bill.

Congress is still on the 'commercialization-is-better' bandwagon as it applies to contract audits. The committee noted the following:

The committee is also aware that the Secretary of Defense is required to conduct joint reviews and submit reports regarding the Defense Contract Audit Agency, Defense Contract Management Agency, and Defense Finance and Accounting Service pursuant sections 925 and 926 of the John S. McCain National Defense Authorization Act for Fiscal Year 2019 (Public Law 115–232). Therefore, the committee directs the Secretary of Defense, acting through the Chief Management Officer of the Department of Defense, to submit risk assessments to the congressional defense committees not later than March 1, 2020, to supplement the reports required by sections 925 and 926 of Public Law 115–232.

The risk assessments should reflect the Department’s analysis of potential combination of functions with each other or the use of commercial providers, as applicable. The risk assessments should include analysis of the legal and ethical implications of:
conflict of interest considerations;

1. the risks posed to governmental interests and the public when ‘‘closely associated with inherently governmental’’ functions as defined in section 2383 of title 10, United States Code, are performed by commercial providers; 
2. the risks to mission failure when ‘‘critical’’ functions as defined in section 2461 of title 10, United States Code, are performed by commercial providers; 
3. the risks of creating an ‘‘employer-employee relationship’’ through the use of ‘‘personal services contracts,’’ whether authorized by statutory exception (e.g., section 129b of title 10, United States Code) or otherwise prohibited; and 
4. the application of each of the general ethical principles in 5 Code of Federal Regulation section 2635.101(b).

While this provision only calls for reports at this time, it does show that Congress doesn't quite trust DoD to do the right thing when it comes to using in-house resources versus contracting out for contract oversight programs and audits.