Ineffective competition and overuse and misuse of sole-source contract  awards. Knowledge and information management—Technologies and tools that  help managers and staff make well-informed acquisitions decisions. The District’s Procurement Law Does Not Promote Transparency, Accountability, and Competition

The District lacks a uniform procurement law that applies to all District   entities and that provides the CPO with adequate authority and  responsibility for the entire acquisition function—an essential component  to promoting transparency, accountability, and competition. In addition,  the law has been amended to exempt certain District entities and  procurements from following the law’s competition and other  requirements. According to current and former District procurement  officials, District entities are seeking to expand independent procurement  authority—a move that would undermine attempts to establish a central  authority. For example, although the law allows the CPO to  delegate procurement authority to employees of District entities covered  under the law and to the CPO’s own staff in the Office of Contracting and  Procurement, the council, with the Mayor’s approval, has used its  authority to pass emergency laws exempting entities and procurement  actions from the CPO’s authority. The District’s Procurement System Does Not Reflect Sound Management and Oversight Practices

In addition to generally lacking a uniform procurement law that applies to  all entities, promotes competition, and provides the CPO the authority to  ensure sound procurement outcomes, the District’s management and  oversight of its procurements have lacked the rigor needed to protect  against fraud, waste, and abuse. At the same time, the District’s  contracting managers and staff, agency heads and program personnel, and  other key procurement stakeholders do not have the basic tools for  ensuring sound acquisition outcomes, including written guidance on the  District’s procurement policies and procedures, a professional  development program and certification requirements for contracting staff,  and an integrated procurement data system. Low-Level Position of the Office of Contracting and Procurement Undermines Management and Oversight

The low-level placement of the Office of Contracting and Procurement  undermines the office’s ability to effectively manage and oversee the  District’s procurements across dozens of agencies and departments. According to District  procurement officials, PASS does not provide full information on  completed or ongoing procurements across all agencies, nor does it  provide CPO and District agency and financial managers reports and other  information they need to manage and oversee the procurement system. Conclusion

To better ensure every dollar of the District’s more than $1.8 billion  procurement investment is well spent, it is critical that the District have an  effective procurement system that follows generally accepted key  principles and is grounded in a law that promotes transparency,  accountability, and competition, and helps to ensure effective  management and oversight and sustained leadership. To effectively address the District’s  long-standing procurement deficiencies, it is clear that high-level attention  and commitment from multiple stakeholders—including Congress—are  needed. Reconsider appropriateness of high dollar thresholds for small  purchases to maximize competition. As part of this review, we  examined and discussed with chief procurement officers reform  efforts in other cities.
Why GAO Did This Study

To improve acquisition outcomes, in 1997 the District established the Office of Contracting and Procurement under the direction of a newly created chief procurement officer (CPO). Since then, the District's inspector general and auditor have identified improper contracting practices. This report examines whether the District's procurement system is based on procurement law and management and oversight practices that incorporate generally accepted key principles to protect against fraud, waste, and abuse. GAO's work is based on a review of generally accepted key principles identified by federal, state, and local procurement laws, regulations, and guidance. GAO also reviewed District audit reports and discussed issues with current and former District officials as well as select state and local officials.

What GAO Found

The District's procurement law generally does not apply to all District entities nor does it provide authority to the CPO to effectively carry out and oversee the full scope of procurement responsibilities across all agencies. A lack of uniformity in its procurement law and the CPO's limited authority not only undermines transparency, accountability, and competition but also increases the risk of preferential treatment for certain vendors and ultimately drives up costs. The current law exempts certain entities and procurements from following the law's competition and other requirements, and according to current and former District procurement officials, there is a push to expand independent procurement authority--a move that would reverse action taken by the District a decade ago. Other provisions of current law further erode competition. Notably, the law provides broad authority for sole source contracting and establishes high-dollar thresholds for small purchases, which are generally not subject to full and open competition. Also, in implementing the law, sufficient management oversight is lacking to ensure employees do not make unauthorized commitments. The District has been challenged to effectively manage and oversee its procurement function, due in large part to the low-level position of the procurement office in the governmental structure, the rapid turnover of CPOs, and multiple players having authority to award contracts and affect contract decisions. At the same time, the District does not have the basic tools that contracting and agency staff and financial managers need to effectively manage and oversee procurements--including a procurement manual, a professional development program, and an integrated procurement data system. In summary, the District's procurement system does not incorporate a number of generally accepted key principles and practices for protecting taxpayer resources from fraud, waste, and abuse. Specifically, the District lacks a comprehensive procurement law that applies to all District entities over which the CPO has sole procurement authority and promotes competition; an organizational alignment that empowers its procurement leadership; an adequately trained acquisition and contracting workforce; and the technology and tools to help managers and staff make well-informed acquisition decisions. To better ensure every dollar of its more than $1.8 billion procurement investment is well spent, it is critical that the District have a procurement system grounded in a law that promotes transparency, accountability, and competition, and helps to ensure effective management and oversight and sustained leadership. High-level attention and commitment from multiple stakeholders--including Congress--are needed if the District's procurement law is to provide the right structure and authority and if procurement reforms are to succeed.