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GSA says it gets the transactional data proposal equation: Burden = price increases

DALLAS–The General Services Administration’s proposal for contractors to submit pricing data for every transaction is causing heartburn among vendors.

GSA continues to review vendor comments on what some call a controversial proposal.

Tom Sharpe, the commissioner of the Federal Acquisition Service at GSA, said the agency has heard those concerns and is working through the comments to try to find the best approach possible.

Tom Sharpe, the commissioner of the Federal Acquisition Service at GSA
Tom Sharpe, the commissioner of the Federal Acquisition Service at GSA

“It’s very important for us to understand the view of industry,” said Sharpe after his speech at the National Contract Management Association World Congress in late July. “I think industry realizes the value and importance of this data to the federal government and the taxpayers we support. I think the discussion is around the most efficient way to get the data, that we safeguard the data and that they understand how we are going to use the data. We are working with industry to ensure those questions and answers are addressed and we will see how the rule comes out.”

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GSA issued the rule on March 4 and it immediately raised red flags among vendors.

In the proposal, GSA said it wants to require vendors to electronically report the price the federal government paid for an item or service bought through GSA acquisition vehicles, producing market intelligence that GSA and its partner agencies can use to make cost-effective acquisition decisions and save even more taxpayer dollars. GSA said it would more than offset this new reporting requirement with the removal of a more burdensome reporting requirement.

Vendor groups say the rule — if implemented as initially written — would be detrimental to wages, competition and limit growth opportunities for small businesses.

Contractor associations also did independent estimates on the reporting burden of the proposed rule, and called GSA’s assumption of an average of 6 hours per company “irrational.”

The Coalition for Government Procurement surveyed its members and estimated that for small business members, it would take 232 hours to set up the initial requirement and 38 hours a month to do the reporting. For its large business members, CGP said the rule would be even more burdensome, taking almost 1,200 hours of set up and 68 hours a month.

The Professional Services Council also looked in to GSA’s burden estimate and found it to be “grossly underestimated.”

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Sharpe said GSA understands the concerns about adding more burden to contractors.

“Burden comes back in prices so those costs passed in price,” he said. “I would think most vendors capture this data now. It’s very powerful for the vendor to understand their customer and the selling of volumes and patterns. So we will see how this shakes out. We had our view of the burden, but we may be better informed with the public and vendor feedback we get on burden and we will take a position on that. We have an interest in keeping the burden as low as possible because it is price bearing.”

While this proposed rule is garnering a lot of attention, GSA is putting several other data analysis tools in place to help agency customers make better decisions on what they buy and from whom.

Sharpe said the 17 acquisition hallways on the Common Acquisition Platform includes Office of Federal Procurement Policy and agency specific guidance, white papers, best practices, sample templates and statements of work, and automated tools such as the prices paid portal or the Calc Tool for determining labor rates for professional services. He said GSA is closely following the use and benefits of the hallways.

GSA recently launched a new tool for federal contracting officers called eBuy Open, which lets them search all open and closed requests for quotes (RFQs) that appeared on the site since 2014.

“The eBuy Open tool helps customers leverage best practices and lessons-learned from across the federal acquisition community,” wrote Cynthia Schell, director of the Common Acquisition Platform Governance Division in a June 23 blog post. “The transparency of eBuy Open helps buyers quickly search open, closed and canceled eBuy Requests for Quotes (RFQs) from FY 2014 forward, showing which agencies are requesting what products and services from GSA schedules.”

Sharpe said he expects GSA to make eBuy Open available to the general public later this year.