Contract Management: Interagency Contract Program Fees Need More Oversight

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A letter report issued by the General Accounting Office with an abstract that begins "Federal interagency contract service programs are being used in a wide variety of situations, from those in which a single agency provides limited contracting assistance to an approach in which the provider agency's contracting officer handles all aspects of the procurement. This increased use of interagency contracts is a result of reforms and legislation passed in the 1990s, allowing agencies to streamline the acquisition process, operate more like businesses, and offer increasing numbers of services to other agencies. Most of the contract service programs GAO reviewed ... continued below

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United States. General Accounting Office. July 25, 2002.

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Description

A letter report issued by the General Accounting Office with an abstract that begins "Federal interagency contract service programs are being used in a wide variety of situations, from those in which a single agency provides limited contracting assistance to an approach in which the provider agency's contracting officer handles all aspects of the procurement. This increased use of interagency contracts is a result of reforms and legislation passed in the 1990s, allowing agencies to streamline the acquisition process, operate more like businesses, and offer increasing numbers of services to other agencies. Most of the contract service programs GAO reviewed reported an excess of revenues over costs in at least one year between fiscal years 1999 and 2001. Office of Management and Budget (OMB) guidance directs agencies with governmentwide acquisition contracts (GWAC) or franchise fund programs to account for and recover fully allocated actual costs and to report on their financial results. Agencies are to identify all direct and indirect costs and charge fees to ordering agencies based on these costs. However, some GWAC programs have not identified or accurately reported the full cost of providing interagency contract services. OMB's guidance further directs that agencies return GWAC earnings to the miscellaneous receipts account of the U.S. Treasury's General Fund. However, this guidance conflicts with the operations of agencies' revolving funds, which were established by statutes that allow retention of excess revenues. The Federal Supply Schedules program has generated hefty earnings, largely because of the rapid growth of information technology sales. Rather than adjust the fee, however, the General Services Administration has used the earnings primarily to support its stock and fleet programs. However, the significant amount of earnings means that Federal Supply Schedules program customers are being consistently overcharged for the contract services they are buying."

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Government Accountability Office Reports

The U.S. Government Accountability Office (GAO) is an independent, nonpartisan agency that works for the U.S. Congress investigating how the federal government spends taxpayers' money. Its goal is to increase accountability and improve the performance of the federal government. The Government Accountability Office Reports Collection consists of over 13,000 documents on a variety of topics ranging from fiscal issues to international affairs.

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  • July 25, 2002

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  • June 11, 2014, 5:03 a.m.

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United States. General Accounting Office. Contract Management: Interagency Contract Program Fees Need More Oversight, report, July 25, 2002; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc294597/: accessed October 19, 2017), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.