Wednesday, May 24, 2017

Defense Acquisition Streamlining and Transparency Act - Part 3

Last Friday and Monday, we discussed certain aspects of the proposed Defense Acquisition Streamlining and Transparency Act that seek to speed up the acquisition process by streamlining auditing processes that are "time consuming and low value" so that Government contract audit organizations such as DCAA (Defense Contract Audit Agency) will begin competing head to head with commercial organizations to perform incurred cost audits. If you missed those postings, you can go back and read Part 1 and Part 2.

Today we want to focus on another key provision of the proposed legislation - streamlining the way the Government buys goods. The Government is statutorily required to conduct market research, competition, and price comparisons prior to purchasing products. The resultant processes however are onerous and time consuming. Even for simple products, market research often entails issuing requests for information, while contracting and price comparisons can involve detailed requirements development and evaluation of in-depth proposals.

The proposed legislation would require the Department of Defense to buy commercial-off-the-shelf-items through the same marketplaces that businesses use to acquire goods; places such as or office depot or uLine. Marketplaces would be limited to those that are commonly used in the private sector; provide a dynamic selection of products and prices from numerous suppliers; and provide procurement oversight controls such as two-person approval for purchases.

The House Armed Services Committee (HASC) and its chairman, Mac Thornberry believe that this commercial proposal would allow off-the-shelf items to "radically" reduce costs and lower time to acquire commercial products.

There are a number of cautions introduced by the new legislation. For example, the marketplace cannot feature or prioritize a product of a supplier based on any compensation or fee paid to the online marketplace by the supplier that is exclusively for such featuring or prioritization on the on-line marketplace. Also, suppliers will need to be screened to ensure that they have not been suspended or debarred.

You can read the entire bill here. As we stated earlier, the intent of the HASC is to roll these provisions into the fiscal year 2018 NDAA (National Defense Authorization Act) so its got a long way to go before it becomes law, if it even survives. So far however, we have not heard any significant objections to this bill.

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