did you all see this press release:
http://news.yahoo.com/s/usnw/20060411/pl_usnw/energy_department_has_worst_small_business_contracting_record__kerry_urges_agency_to_implement_report_recommendations322_xmlEmphasis added. Wonky but worth reading if you want to know what our hero is up to.
Energy Department Has Worst Small Business Contracting Record; Kerry Urges Agency to Implement Report Recommendations Tue Apr 11, 6:56 PM ET
To: National Desk, Business Reporter
Contact: Kathryn Seck, 202-224-9431
WASHINGTON, April 11 /U.S. Newswire/ -- The nation's largest civilian contracting agency is not awarding enough contracts to small businesses and has failed to take the appropriate steps to meet its goals, Sen. John Kerry (D-Mass.) charged today following the release of a new report by the Government Accountability Office (GAO) on the Department of Energy's small business program (Part 2 of 2):
On May 13, 2005, the GAO released a report finding, "DoE has not taken adequate steps to address the problems with the small business subcontracting data reported by its facility management contractors, resulting in a lack of assurances that facility management contractors are providing maximum practicable opportunities for small business subcontracting." The GAO found that data on small business subcontracting was frequently overstated, data reported by facility management contractors was not useful, and DoE oversight of subcontracting achievement by their prime contractors was inadequate. (3)
As subcontractors to large facility management contractors, small businesses must often compete for firm fixed price or fixed unit price subcontracts. According to the GAO, many of the prime contractors are performing under cost reimbursable, incentive fee contracts (cost plus contracts) which have been shown to increase costs for the federal government because DoE project managers simply adjust cost baselines when the large prime contractors over-run the original cost estimate(4). Meanwhile, these same prime contractors often shift cost-overruns and risk to small business subcontractors through the award of hundreds of small, narrow scope niche subcontracts under firm fixed price subcontracts, most often to the lowest bidder. With a variable cost prime contract and fixed price subcontract structure, the cost increases found in many of these facility management contracts result from prime contractors applying their own overhead, general and administrative burden, and fees to fixed price subcontracts that already include performance-based fees. Clearly, relying on subcontracting as the primary tool for small business participation is not meeting the needs of the Agency or the intent of Congress for a diverse supplier base or cost savings in federal contracts that comes from competition.
Further, with only 13 percent of contract dollars at DoE being awarded to non-facility management contractors in 2005, and a trend towards more dollars being spent through these large prime contractors, targeting non-facility management contracts as a source for small business competition is not enough. More procurement activities need to be broken out from existing facility management contracts and there needs to be a greater emphasis on new procurement activities being competed among small firms.
With only a 4.15 percent small business utilization rate, it is clear that the current level of outreach and breaking-out contracts is simply not working.(snip)
I hope to continue working with you to ensure that small businesses receive a greater share of contract dollars awarded at the DoE and that they are afforded the greatest opportunity to play a more significant role in the Department's core mission. These firms can offer the cost savings and technical innovation that is so greatly needed to meet the Department's needs. Please respond by Friday, April 28, 2006 with the details of what specific actions the DoE will take to implement the above recommendations. I look forward to your prompt response.
Sincerely,
John F. Kerry
http://www.usnewswire.com/