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Service contractors replacing Feds?


Odinita

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Is it okay to contract for full-time long-term support?  

I was raised in DoD contracting and now work for a civilian agency. I know that DoD 1102s have to deal with 100 times the regulations we do in the civilian agencies and sometimes- even 6 years out - I am still wrapped up in the policies I was raised on.  That said, the other day I got a SOW that declared they needed 3 clerks 40 hours each week (for a program I’ve just inherited in a reorganization).  I had a nice call with the COR and explained she was augmenting government staff and we would need to change the requirements for this reason. She responded that they have been handling it this way for more than 20 years, which I thought supported my case but I cannot find anything to support me, as they are not inherently governmental functions and aren’t treated as personal services. 
 

What am I missing? 

Edited by Odinita
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  • Odinita changed the title to Service contractors replacing Feds?
3 minutes ago, Don Mansfield said:

Why do you believe this?

I think now I might be wrong (gasp). I thought this was a violation of fiscal law. The COs that I generally use for a reality check were also in complete agreement - you can’t write a contract replacing Government staff. We were sure this was true (but we also came from similar DoD commands).  
 

As you may have guessed,  we can’t find what we think we know. 

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  • 2 weeks later...
On 4/1/2021 at 5:31 PM, Odinita said:

I think now I might be wrong (gasp). I thought this was a violation of fiscal law. The COs that I generally use for a reality check were also in complete agreement - you can’t write a contract replacing Government staff. We were sure this was true (but we also came from similar DoD commands).  
 

As you may have guessed,  we can’t find what we think we know. 

Well I am late to this party but let's back step a little.  My thoughts might help.  Your recollection may not necessarily reach an issue of fiscal law nor the rules regarding inherently governmental.   Your recollection might be with regard to "personal services" and matters related to the employment as provided for in the CFR and USC.   A couple of references that you may be aware of to get you started.....

FAR 37.104 and 37.112

By providing the above I am not making any judgement about your particular situation as the agency may have determined the work being done does not reach into issues of personal services but I am always intrigued by the mention of something like "3 clerks 40 hours each week".   If truly three bodies paid at an hourly rate supervised by the program area how does the litmus test of 37.107 pan out?  

I might add that yes there is a reach to fiscal law as well best stated by this short blurb from the GAO Redbook (Chapter 3, page 3-13)....

Brief mention should also be made of the axiom that an agency cannot do indirectly what it is not permitted to do directly. Thus, an agency cannot use the device of a contract, grant, or agreement to accomplish a purpose it could not do by direct expenditure. See 18 Comp. Gen. 285 (1938) (contract stipulation to pay wages in excess of Davis-Bacon Act rates held unauthorized). See also B-259499, Aug. 22, 1995 (an agency cannot use an Economy Act agreement to provide personal services where the ordering agency is not authorized to contract for personal services).

I hope this helps with finding what you really might know!

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Here is what the Army's Request for Service Contract Approval (RSCA) form says:

"When contracting for services, care must be taken to ensure that no illegal out-sourcing or improper conversion is taking place.
Illegal “out-sourcing” and improper conversion involve shifting work from civilian positions to contract personnel (this can
happen even if the civilian position is not encumbered). In environments that involve fiscal uncertainty, declining budgets, or
hiring freezes, special vigilance is required to ensure these things do not occur.

Due to congressional moratorium on A-76/ public private competitions, no out-sourcing is currently allowed. If the
moratorium on A-76/ public private competitions ends, a competition is required. Work currently being performed by inhouse
civilian employees or designated for in-house civilian employee performance may not be directly converted to
contractor performance. If law and policy is ever changed to allow direct conversions to contract performance, a cost
comparison must still be done under DoDI 7041.04 (Estimating and Comparing the Full Costs of Civilian and Active Duty
Military Manpower and Contract Support, 3 July 2013), in order to establish which source of labor is the least costly.

Title 10, United States Code § 2461 prohibits converting a function performed by at least one appropriated fund government
employee to contract performance unless there has been a public-private competition under Office of Management and Budget
Circular A-76. There is currently a Congressional moratorium on public-private competitions pursuant to the National Defense
Authorization Act for Fiscal Year 2010, Section 325. However, “conversion” of functions does not include the augmenting of
civilian staff with contractors unless government employees are displaced, reassigned, subjected to a reduction in force, or
otherwise adversely affected.


(For additional information, please see the Government Accountability Office case John P. Santry B-402827. Agencies are
recommended to discuss the issue with their employment and personnel law advisor and their contract law advisor.)
If there is an applicable bargaining unit agreement concerning out-sourcing, the provisions of the agreement will prevail and
must be adhered to for bargaining unit employees (though such an agreement does not take precedence over Title 10, U.S.C.).
Further prohibitions on contracting under certain conditions can be found in 10 U.S.C. § 129a(f)."

There are a series of 6 questions are the RSCA from that must be answered:

"1 Will any non-temporary or non-term appropriated fund employee currently performing any
functions described in the contract Statement of Work be displaced, reassigned, subjected to a
reduction in force, or otherwise adversely affected as a result of the proposed contract action?
2 Is the function proposed for contract performance meeting a requirement previously performed by
a particular Army civilian position (or positions) when a program or budget decision eliminated the
civilian position (whether that function was formerly documented with an authorization or was
undocumented and performed by an overhire)?
3 Is the function proposed for contract performance meeting a requirement previously approved for
in-sourcing but that was never encumbered?
4 Will the proposed contract action fundamentally change the nature of the work performed by
appropriated fund employees?
5 Is this new contract (or this increase in level of effort on a pre-existing contract) the result of the
establishment of numerical goals or budgetary savings targets regarding the civilian workforce?
6 Is this contract, modification, or this increase in level of effort on a pre-existing contract, the result
of the imposition of a civilian hiring freeze?"

You might want to look into the above references, and see what they say.

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jtolli, Odinita is not working for DoD, so Title 10 is inapplicable here. 

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I format all about this

Quote

Here is what the Army's Request for Service Contract Approval (RSCA) form says:

It’s a 12 page questionnaire that needs completed!  So much for allowing 1102s and others to exercise judgement and make decisions.  This makes most everybody clerks.  It seems like the Army doesn’t want anyone to think or act differently than what management wants 

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