Second, the act provides that a solicitation may be issued for a single contract for the performance of multiple depot-level maintenance or repair workloads. Our lack of access to information is seriously impairing our ability to carry out our reporting responsibilities under this act. We experienced this problem in doing our work for our recent report to Congress concerning DOD’s determination to combine individual workloads at the two closing logistics centers into a single solicitation. Processes for C-5 Aircraft Competition Appear Reasonable

In response to congressional concerns regarding the appropriateness of its plans to privatize-in-place the Sacramento and San Antonio maintenance depot workloads, the Air Force revised its strategy to allow the public depots to participate in public-private competitions for the workloads. After assessing the issues required under the act relating to the C-5 aircraft competition, we concluded that (1) the Air Force provided public and private offerors an equal opportunity to compete without regard to where work would be performed, (2) the procedures did not appear to deviate materially from applicable laws or the FAR; and (3) the award resulted in the lowest total cost to the government, based on Air Force assumptions and conditions at the time of award. Under the 1998 Defense Authorization Act, DOD issued the required determinations that the workloads at these two depots “cannot as logically and economically be performed without combination by sources that are potentially qualified to submit an offer and to be awarded a contract to perform those individual workloads.” As required, we reviewed the DOD reports and supporting data and issued our report to Congress on January 20, 1998.We found that the accompanying DOD reports and supporting data do not provide adequate information supporting the determinations. Consequently, there was no support for the Department’s determination that the individual workloads cannot as logically and economically be performed without combination. However, all recurring cost elements were not considered. Concerns Raised Regarding the Sacramento and San Antonio Competitions

As part of our mandated review of the solicitations and awards for the Sacramento and San Antonio engine workloads, we reviewed DOD reports to Congress in connection with the workloads, draft requests for proposals, and other competition-related information. These participants raised several concerns that they believe may affect the competitions. Determining the current and future public-private sector mix using the revised criteria is essential before awards are made for the Sacramento and San Antonio workloads. Preliminary data indicates that using the revised criteria, about 47 to 49 percent of the Air Force’s depot maintenance workload is currently performed by the private sector. During the recent C-5 workload competition evaluation, the Air Force included a $153-million overhead savings estimate for the impact that the added C-5 workload would have on reducing the cost of DOD workload already performed at the military depot’s facilities. In response to private sector concerns, the Air Force is considering limiting the credit given for overhead savings in the Sacramento and San Antonio competitions. The second year savings, if supportable, will be allowed but discounted for risk. DOD Letters on Access to Records Regarding Public-Private Competitions

The first copy of each GAO report and testimony is free.
Why GAO Did This Study

GAO discussed the public-private competitions for workloads at two maintenance depots identified for closure, focusing on: (1) the problems GAO is having in obtaining access to Department of Defense (DOD) information; (2) the recent competition for C-5 aircraft workload and GAO's assessment of it; (3) the adequacy of DOD's support for its determination that competing combined, rather than individual workloads of each maintenance depot is more logical and economical; and (4) concerns participants have raised about the upcoming competitions for the workloads at the air logistics centers in Sacramento, California, and San Antonio, Texas.

What GAO Found

GAO noted that: (1) its lack of access to information within DOD is seriously impairing its ability to carry out its reporting requirements; (2) GAO completed, with difficulty, its required report to Congress concerning DOD's determination to combine individual workloads at two closing logistics centers into a single solicitation at each location; (3) if DOD continues to delay and restrict GAO's access to information it needs to do its work, GAO will be unable to provide Congress timely and thorough responses regarding the competitions for the Sacramento and San Antonio depot maintenance workloads; (4) in assessing the competition for the C-5 aircraft workloads, GAO found that: (a) the Air Force provided public and private sources an equal opportunity to compete for the workloads without regard to where the work could be done; (b) the Air Force's procedures for competing the workloads did not appear to deviate materially from applicable laws or the Federal Acquisition Regulation; and (c) the award resulted in the lowest total cost to the government, based on Air Force assumptions at the time; (5) for the remaining workloads at Sacramento and San Antonio, DOD reports and other data do not support the Defense Secretary's determination that using a single contract with combined workloads is more cost-effective than using separate contracts for individual workloads; (6) much remains uncertain about the upcoming competitions for the Sacramento and San Antonio depot maintenance workloads; (7) potential participants have raised several concerns that they believe may affect the conduct of the competitions; (8) one concern is the impact of the statutory limit on the amount of depot maintenance work that can be done by non-DOD personnel; (9) the Air Force has not yet determined the current and projected public-private sector workload mix using criteria provided in the 1998 Defense Authorization Act, but is working on it; (10) nonetheless, preliminary data indicates there is little opportunity to contract out additional depot maintenance workloads to the private sector; (11) another concern is the Air Force's proposed change in the overhead savings the Department may factor into the cost evaluations; (12) for the C-5 workload competition, overhead savings were considered for the duration of the performance period; and (13) however, for the Sacramento and San Antonio competitions, the Air Force is considering limiting overhead savings to the first year and possibly reducing the savings for the second year.