[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]
INSPECT WHAT YOU EXPECT: CONSTRUCTION
CONTRACTING PRACTICES AT THE
U.S. DEPARTMENT OF VETERANS AFFAIRS
=======================================================================
HEARING
before the
SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS
of the
COMMITTEE ON VETERANS' AFFAIRS
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED TWELFTH CONGRESS
FIRST SESSION
__________
APRIL 13, 2011
__________
Serial No. 112-8
__________
Printed for the use of the Committee on Veterans' Affairs
----------
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COMMITTEE ON VETERANS' AFFAIRS
JEFF MILLER, Florida, Chairman
CLIFF STEARNS, Florida BOB FILNER, California, Ranking
DOUG LAMBORN, Colorado CORRINE BROWN, Florida
GUS M. BILIRAKIS, Florida SILVESTRE REYES, Texas
DAVID P. ROE, Tennessee MICHAEL H. MICHAUD, Maine
MARLIN A. STUTZMAN, Indiana LINDA T. SANCHEZ, California
BILL FLORES, Texas BRUCE L. BRALEY, Iowa
BILL JOHNSON, Ohio JERRY McNERNEY, California
JEFF DENHAM, California JOE DONNELLY, Indiana
JON RUNYAN, New Jersey TIMOTHY J. WALZ, Minnesota
DAN BENISHEK, Michigan JOHN BARROW, Georgia
ANN MARIE BUERKLE, New York RUSS CARNAHAN, Missouri
TIM HUELSKAMP, Kansas
Vacancy
Vacancy
Helen W. Tolar, Staff Director and Chief Counsel
______
SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS
BILL JOHNSON, Ohio, Chairman
CLIFF STEARNS, Florida JOE DONNELLY, Indiana, Ranking
DOUG LAMBORN, Colorado JERRY McNERNEY, California
DAVID P. ROE, Tennessee JOHN BARROW, Georgia
DAN BENISHEK, Michigan BOB FILNER, California
BILL FLORES, Texas
Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public
hearing records of the Committee on Veterans' Affairs are also
published in electronic form. The printed hearing record remains the
official version. Because electronic submissions are used to prepare
both printed and electronic versions of the hearing record, the process
of converting between various electronic formats may introduce
unintentional errors or omissions. Such occurrences are inherent in the
current publication process and should diminish as the process is
further refined.
C O N T E N T S
__________
April 13, 2011
Page
Inspect What You Expect: Construction Contracting Practices at
the U.S. Department of Veterans Affairs........................ 1
OPENING STATEMENTS
Chairman Bill Johnson............................................ 1
Prepared statement of Chairman Johnson....................... 33
Hon. Joe Donnelly, Ranking Democratic Member..................... 3
Prepared statement of Congressman Donnelly................... 34
Hon. John Barrow, prepared statement of.......................... 34
WITNESSES
U.S. Department of Veterans Affairs:
Belinda J. Finn, Assistant Inspector General for Audits and
Evaluations, Office of Inspector General..................... 4
Prepared statement of Ms. Finn............................... 35
Glenn D. Haggstrom, Executive Director, Office of Acquisition,
Logistics, and Construction.................................. 13
Prepared statement of Mr. Haggstrom.......................... 40
MATERIAL SUBMITTED FOR THE RECORD
Post-Hearing Follow-up Information:
Glenn D. Haggstrom, Executive Director, Office of
Acquisition, Logistics, and Construction, U.S. Department
of Veterans Affairs to Director for Congressional Affairs,
Memorandum and Attachments, dated
April 28, 2011............................................. 42
Post-Hearing Questions and Responses for the Record:
Hon. Bill Johnson, Chairman, Subcommittee on Oversight and
Investigations, Committee on Veterans' Affairs, to Hon.
Eric K. Shinseki, Secretary, U.S. Department of Veterans
Affairs, letter dated May 10, 2011, and VA responses....... 47
Hon. Joe Donnelly, Ranking Member, Subcommittee on Oversight
and Investigations, Committee on Veterans' Affairs, to
Glenn D. Haggstrom, Executive Director, Office of
Acquisition, Logistics, and Construction, U.S. Department
of Veterans Affairs, letter dated May 2, 2011, and VA
responses.................................................. 68
INSPECT WHAT YOU EXPECT: CONSTRUCTION
CONTRACTING PRACTICES AT THE
U.S. DEPARTMENT OF VETERANS AFFAIRS
----------
WEDNESDAY, April 13, 2011
U.S. House of Representatives,
Committee on Veterans' Affairs,
Subcommittee on Oversight and Investigations,
Washington, DC.
The Subcommittee met, pursuant to notice, at 10:04 a.m., in
Room 334, Cannon House Office Building, Bill Johnson [Chairman
of the Subcommittee] presiding.
Present: Representatives Johnson, Roe, Donnelly, McNerney,
and Barrow.
OPENING STATEMENT OF CHAIRMAN JOHNSON
Mr. Johnson. Well, good morning, this hearing will come to
order this morning.
I want to welcome everyone to today's hearing on Inspect
What You Expect: Construction Contracting Practices at the U.S.
Department of Veterans Affairs (VA).
I would also like to apologize in advance that I may have
to leave early or intermittently for a markup at the Natural
Resources Committee taking place this morning. I apologize in
advance for that conflict. I know that some other Members may
have to leave for that same purpose, they will be affected as
well, but we will get through the hearing as best we can or we
will recess if necessary to accommodate those.
Before we start I would like us to real briefly recite the
pledge of allegiance. So if everyone would rise we will start
off that way.
[Pledge was taken.]
Mr. Johnson. And again, thank you very much.
In a Department the size of the VA, the contracting process
involves billions of dollars annually. These funds are
necessary to ensure those who so bravely served the country are
provided the care and benefits that they have earned; however,
problems arise when the contracting process is mismanaged and
poorly executed contracting on the scale of billions of
dollars, such as what we see at VA, can mean billions of
dollars wasted, taxpayer dollars that were supposed to help the
veterans.
A contracting process done correctly can actually help an
organization save money in the long run.
Good contracting on a construction project entails having
an independent cost analysis of all available options,
eliminating preferential treatment, and executing a timely
process that results in a product delivered in a timely fashion
and at the best cost.
VA has acknowledged it would improve the quality of its
contracting process through the use of the Electronic Contract
Management System, or eCMS, as it has become known.
In June of 2007, an information letter was issued by VA's
Executive Director of the Office of Acquisition and Logistics
mandating the use of eCMS. This database would record and track
procurement actions of over $25,000, and the data could then be
easily and comprehensively reviewed to determine the
effectiveness of VA's contracting processes and make changes
where necessary. Cost overruns could be identified and
addressed early on, and perhaps even prevented in the first
place.
This sensible approach to overseeing the contracting
process could reduce overall contract mismanagement, prevent
potential fraud, and ultimately prevent wasted taxpayer
funding.
For some reason, despite its mandated usage, many
supervisors and managers across the VA choose and have chosen
to ignore eCMS, instead allowing the contracting system and
associated runaway costs to continue.
VA's Office of Inspector General (OIG) found clear cases of
missing and incomplete information, and in one test discovered
that 83 percent of the transactions that should have gone into
eCMS were left out. Examples such as this dilute the value of
eCMS as an accountability measure, and in the end veterans and
taxpayers bear the loss.
While VA acknowledged the OIG's findings and concurred with
recommendations for improvement, it is my wish to see concrete
evidence of that improvement.
Reports of other clear cases of contract mismanagement are
equally disturbing, including bundling contracts as well as
splitting contracts, as was substantiated by the Deputy
Assistant Secretary for Acquisition and Logistics nearly a year
ago.
As these contracts are mishandled, much needed construction
is slowed considerably and the needed services that a new
medical facility would provide are further delayed. Again,
those who are hurt most by these actions are the veterans.
If we are to get this right, there must be decisive
leadership in contracting and accountability for actions at all
levels. If eCMS was mandated by VA's leadership to be used, why
then is it obviously not being used? If certain contracts on a
construction project are intended for veteran-owned small
businesses, why would a large business be competing for them?
If plans are put in place for an expanded outpatient clinic,
why then would the size and scope of that project change, not
once, but twice?
It is past time for these billions of construction
contracting dollars to be used effectively, efficiently, and in
a timely fashion so the veterans who need the services provided
by these facilities can access them.
I appreciate everyone's attendance at this hearing and I
now yield to the Ranking Member for an opening statement.
[The prepared statement of Chairman Johnson appears on p.
33.]
OPENING STATEMENT OF HON. JOE DONNELLY
Mr. Donnelly. Thank you, Mr. Chairman, for holding this
hearing today, I look forward to today's discussion.
I would like to welcome everyone as we have the opportunity
to conduct the Subcommittee on Oversight and Investigations
first hearing of the 112th Congress.
I am honored to serve as the Ranking Member and look
forward to working with Chairman Johnson and other Members on
both sides of the aisle.
Prior to today's hearing, we had the opportunity to meet
and discuss the Oversight and Investigations (O&I) agenda for
the upcoming year, and from our discussions, I know we have a
full plate, and one we are both committed to working in a
bipartisan manner as we seek to provide the oversight our
Nation's veterans rightly deserve.
Today's hearing is an example of that bipartisan work. The
VA procurement efforts and initiatives have been problematic
and controversial at times. It is important we make certain the
VA is doing their due diligence prior to awarding contracts.
There are many steps the VA must take in between initiating
procurement project proposals and post-awards.
Today, we hope the VA will assure us that construction
projects are fully reviewed to ensure successful delivery and
management.
It seems to me that there have been too many VA Office of
Inspector General reports indicating that the VA's lack of
contract details is there. Furthermore, unrealistic and
unreasonable acquisition plans have led to escalated contract
costs and unmet contractor milestones.
One of my concerns is how many times do we need to meet
with the VA only to find out that after millions of dollars
have been spent on a contract the contractor walks away with
these funds after the VA cancels their contracts due to unmet
deliverables? This is an indication that we have to do better.
Furthermore, since the 110th Congress, this Committee has
been providing oversight on contract bundling. I am familiar
with these issues having been a Member of the Committee on
Veterans' Affairs since the 110th Congress and have
participated in various hearings on this topic.
Contract bundling by contracting officers should be
reviewed carefully as well. Whether it may be awarding
contracts or set-aside initiatives for veteran-owned small
businesses, bundled contracts create opportunities for fraud
and mismanagement.
I will be particularly interested in the implementation of
the VA's Electronic Contract Management System.
Thank you, Mr. Chairman, and I yield back.
[The prepared statement of Mr. Donnelly appears on p. 34.]
Mr. Johnson. I thank my colleague for his comments and now
I invite the first panel to the witness table.
On this panel we will hear testimony from Belinda J. Finn,
Assistant Inspector General for Audits and Evaluations at the
VA Office of Inspector General; Assistant Inspector General
Finn is accompanied by Cherie Palmer, and Audit Director at the
Chicago Audit Operations Division of the VA Office of the
Inspector General.
Ms. Finn, your complete written statement will be made part
of this hearing record, and you are recognized for 5 minutes.
STATEMENT OF BELINDA J. FINN, ASSISTANT INSPECTOR GENERAL FOR
AUDITS AND EVALUATIONS, OFFICE OF INSPECTOR GENERAL, U.S.
DEPARTMENT OF VETERANS AFFAIRS; ACCOMPANIED BY CHERIE PALMER,
DIRECTOR, CHICAGO OFFICE OF AUDITS AND EVALUATIONS, OFFICE OF
INSPECTOR GENERAL, U.S. DEPARTMENT OF VETERANS AFFAIRS
STATEMENT OF BELINDA J. FINN
Ms. Finn. Mr. Chairman and Members of the Subcommittee,
good morning and thank you for this opportunity to testify on
the Department of Veterans Affairs procurement processes and
construction.
With me today is Cherie Palmer, Director of the Chicago
Audit Division.
Procurement continues to be one of VA's major management
challenges. Our oversight of VA's procurement activities has
reported on the need for increased management visibility of VA
acquisitions on several occasions. Having accurate and reliable
information is critical for VA's ability to manage its
acquisitions nationwide and make good procurement decisions.
In July 2009, we reported that the VA Electronic Contract
Management System known as eCMS, contained incomplete
information on VA acquisitions. We compared the contract
actions in eCMS with data from two other sources.
First, we looked for information on over 6,000 procurement
actions from VA's Integrated Funds Control System. We found
that nearly 83 percent of those actions were not recorded in
eCMS.
Second, we compared contract actions from the General
Services Administration's (GSA's) Federal Procurement Data
System and found nearly 21 percent of those actions were only
partially completed in eCMS. The eCMS contained no information
on another 31 percent, and in total eCMS had complete
information on less than half of the over 1400 actions we
checked from GSA's system.
Therefore, we concluded that the reports generated by eCMS
were unreliable, incomplete, and could not be used when making
management decisions.
We recommended eight separate actions of which three remain
unimplemented today. The open recommendations including
implementing a VA-wide eCMS policy handbook, improving the
technical performance of eCMS, and integrating eCMS with VA
financial systems.
Additionally ongoing audit work at VA's largest contracting
activity continues to identify problems in the use of eCMS to
develop and maintain national contracts.
As part of our oversight on VA's construction program, we
performed a follow-up audit in 2009 and found that VA had
established a Quality Assurance (QA) program and procedures to
resolve previously reported problems; however, QA programs
still needed written policies, procedures, performance
measures, and a staffing plan. We noted that the QA program
could not oversee contract schedule slippage because it was
focused on performing field acquisition reviews.
VA management agreed with our recommendations to address
the reported problems and has completed action on all but one
of the four recommendations.
We will continue to access the effectiveness of VA's
construction program in future work.
In addition to our national audits of acquisition and
construction, the OIG provides ongoing oversight through other
avenues. For example, OIG criminal investigators liaison with
VA contracting personnel, program managers, and contractor
staff to deter, detect, and investigate potential construction
fraud.
Finally, our Office of Contract Review began reviewing pre-
award documents and claims related to construction contracts
earlier this year.
While VA has recognized deficiencies in its acquisition
processes and infrastructure they have much more work to do. We
believe VA should continue its efforts to leverage the full
capability of eCMS and integrate it into existing and future
financial systems.
Mr. Chairman, this concludes my statement. We would be
pleased to answer any questions that you or other Members of
the Subcommittee may have.
[The prepared statement of Ms. Finn appears on p. 35.]
Mr. Johnson. Thank you, Ms. Finn, I appreciate that very
much. We will now--Ms. Palmer you do not have an opening
statement; is that correct? Okay. All right, just wanted to
make sure.
Well, let us immediately go into questions. And Ms. Finn,
could you describe for us the basic functions of eCMS?
Ms. Finn. I will describe them as far as I can. I am not a
user of the system, so a more complete answer would probably
come from the second panel, from the VA experts.
The eCMS is a contract writing system. It was developed to
be able to prepare contract documents and clauses easily.
For us it provides the capability to compile information on
the contracts in a particular location. Before eCMS, that
capability was not in the Department, and as we were doing
audits we would have to build a universe at every location we
went to in order to have a group of contracts from which to do
our work.
Mr. Johnson. In your written testimony, you provided
several examples of incomplete or missing contracts within
eCMS. In your opinion, would the proper use of eCMS have aided
the VA in more effective project management?
Ms. Finn. It is a little difficult to extrapolate the
contract information in eCMS to total project management, and I
say that because project management involves much more than
just managing the contract. Certainly though knowing your
contracts and having that information handy is a critical piece
of information.
Mr. Johnson. During your testimony, you talked about one of
your recommendations being the integration of eCMS into other
VA systems, including their financial management systems. I
believe that is what you said if I understood correctly.
Certainly program management, financial management of projects
as a core aspect of any program management philosophy or
system.
Is it safe to say that if eCMS were being used properly and
integrated properly that we would have, the VA would have a
more effective vision or ability to see comprehensively what is
going on within these very expensive contract or construction
projects?
Ms. Finn. I think that is fair to say. One of the issues we
noted when we were first looking at the usage of eCMS is that
people working in the field had to input information twice in
order to use eCMS. They had to put in it eCMS and they also had
to put it into the Integrated Funds Distribution, Control Point
Activity, Accounting and Procurement (IFCAP) system, which is
the integrated fund control system.
IFCAP controlled the obligations, and so those managers
really needed to put it into the IFCAP because that was their
funding mechanism in their financial system that fed into VA's
financial systems. So faced with those choices, they tended to
put it into their financial system and not put it into eCMS.
If it is integrated, they will put it into eCMS and it
should feed into the financial system and we will have better
records.
Mr. Johnson. Okay. Let us go back to the overall purpose of
eCMS, and correct me if I am wrong, but eCMS is basically an
oversight, an accountability tool, right? I mean it allows
those, including senior officials within the VA, as well as
Members of Congress, to be able to go look at the status of
projects and contracts, correct?
Ms. Finn. Yes, and from our viewpoint, it is a great
advantage when contracts are on eCMS because we can look at
them remotely from our office in Los Angeles where as before,
we had to travel to every single facility in order to look at
hard copies.
Mr. Johnson. All right.
Thank you very much, I think that is all the questions I
have at this point. I will now yield to Ranking Member Donnelly
for his questions.
Mr. Donnelly. Thank you, Mr. Chairman. Good morning, Ms.
Finn, thank you for being with us here today, and good morning,
Ms. Palmer, thank you very much. I am from South Bend, Indiana,
not too far away from Chicago, so it is good to see you out
here.
Ms. Finn, why do you think these problems have developed?
Is there a consistent theme as to something VA is missing or is
failing to do in hitting the proper contracting methods?
Ms. Finn. Are you referring to why consistently we find
eCMS still isn't being used?
Mr. Donnelly. Yes.
Ms. Finn. Okay. Ms. Palmer has some insights on that, I am
going to ask her to share them.
Ms. Palmer. Thank you, Belinda.
During our audit work for the audit of eCMS, we surveyed
1,382 users across all VA business lines. Our survey
respondents stated that eCMS is not used consistently due to
personnel shortages, time constraints, heavy workloads,
inadequate training, and conflicting guidance. They also stated
that the system was slow and cumbersome and told us that they
received conflicting guidance on how to use the system.
During our ongoing work at the National Acquisition Center,
we found that although the Office of Acquisition, Logistics,
and Construction (OALC) mandated eCMS usage, it did not
adequately ensure the required use of eCMS.
Contract data is entered and maintained in the National
Acquisition Center Contract Management System, which is a
separate system; however, eCMS is the mandated acquisition
information system. It only serves VA customers and that is why
they utilize two systems. Other government agencies, non-VA
customers using the national contracts cannot access the
information available in eCMS. The CM system provides an
Internet electronic catalog function that allows non-VA
customers to access that contract data.
Mr. Donnelly. Do you feel the VA personnel who do
contracting that the eCMS system is there but they more or less
feel I have to get a contract done, I have to get this
organized, I have to get this out and they really don't know
how to properly use eCMS, is that what you are hearing?
Ms. Palmer. I think the survey that we did in 2009 would
agree with exactly what you said, but we haven't done any
follow-up work.
Mr. Donnelly. Ms. Finn, do you have any estimate, ballpark,
we are not going to hold you to an exact number obviously, but
the failure to use the system properly, the contracting that is
done with some of the steps missing. Do you have any idea how
much money this is costing us at the end of the day? How much
money could be saved that is not?
Ms. Finn. No, sir, I really don't. I can't say for sure
those contracts aren't managed properly.
Mr. Donnelly. Right.
Ms. Finn. We just know they are not being recorded.
Mr. Donnelly. Okay. And so what we have is we can't say the
contracts aren't being run the best that contracts can be run,
it has just not been put into the system the right way.
Ms. Finn. It is not in the system and so, therefore, the
visibility of that contract is possibly going to be limited
once you get away from the local facility where the contract
was awarded.
Mr. Donnelly. What do you think is the most important thing
that the VA can do to start running these contracts properly?
Ms. Finn. I think having the oversight and the visibility
is a very important first step. You can't manage what you don't
know about, and that is true for the facility, the Veterans
Integrated Services Network (VISN), the network offices, and
also the Veterans Health Administration (VHA), as well as VA
and even my office. It is hard to provide oversight when you
don't know about something and you have to go search it out. I
think that is a key.
I think the problems with the usage of eCMS being
cumbersome and hard are hurdles that the Department is still
working on to improve the technical performance of the system
and that is a critical step, because as you said, if you are
pushed for time you may skip a step because it is hard to do.
So they definitely need to work on improving the technical
performance of the system and the integration to make it
seamless that will help improve the visibility a great deal.
Mr. Donnelly. Well, my time is up, but I want to thank both
of you for your efforts to do a good job with the VA and to
save taxpayer dollars.
So with that, Mr. Chairman, I will yield back.
Mr. Johnson. I thank the gentleman and I now yield to my
colleague from Tennessee, Mr. Roe, for your questioning.
Mr. Roe. Okay, thank you, Mr. Chairman, and thank you all
for being here today.
I guess one of the questions, you know, we talk a lot about
mandates around here, you are being adjudicated in a court
about another subject, but if the VA is mandated to implement
and use this system are there any penalties if you just decide
it is too--I think you mentioned we don't have enough people,
it is too cumbersome, and slow, we are not trained and on and
on. Those are all excuses, but if you are mandated to do it I
thought you should be doing it, and if you don't do it is there
any penalty at all for not just not doing it?
Ms. Finn. I don't know of any penalty, but the VA panel who
is coming after me may be able to answer that question.
Mr. Roe. Okay. Well, I realize that new things or different
things are hard to do. I mean we have all been in new systems
that are difficult and we tend to go with what we are
comfortable with and we know has worked before.
And so, I guess the next question I have on the new eCMS
system, it was put there for transparency; is that correct, so
that you and I and other people would have access to this
information so that we can make decisions about how these
billions of dollars in VA are being spent; is that correct?
Ms. Finn. That is my understanding.
Mr. Roe. Yes. And when it is not being implemented is there
a way, Ms. Finn, and I guess Ms. Palmer either one of you can
answer this, that you can easily find out this information or
is it just a rat maze?
Ms. Finn. No, there is not a way. In the past, in order to
do audits at facilities, we have had to resort to searching
through financial systems using cost accounting codes or other
mechanisms to try and identify contracts. It is very difficult.
Mr. Roe. So it would be impossible for me or anyone or any
citizen or anybody else to ever get that information?
Ms. Finn. I would think it would be pretty close, yes.
Mr. Roe. Okay. So then one of the reasons, how long has
this system been in place? When was it implemented, what year?
Ms. Finn. 2007.
Mr. Roe. So this is the fourth year that it would have been
implemented.
Ms. Finn. Yes, sir, I believe so.
Mr. Roe. And it is not being used, and in a sense there is
no penalty, there really isn't any urgency to implement the
system the best I can see; is that correct?
Ms. Finn. The system is being used. It was not being used
totally when we did our first audit. We haven't done a full
followup to see the total usage now, but we do know from some
statistics the Department has reported to us as they have
increased their oversight since our report that the usage has
increased dramatically.
Mr. Roe. Well, I guess from O&I investigation or is it
reasonable to think that when you implement a system that you
should be able to do it in less than 4 years?
Ms. Finn. I guess I would say the system is implemented. It
has taken that long to get consistent usage, and I don't know
if it should take 4 years. It does seem a little long.
Mr. Roe. I think we know the answer to that question.
And this is through the VA procurement and various
contracting, of course they will be up here in a minute and we
will be able to ask them questions.
If you had a suggestion would you relook? Do you think that
your particular investigation has uncovered anything? Because
you mentioned something I thought was very important, because
they are entered in it doesn't mean it is not being done right.
Ms. Finn. Yes.
Mr. Roe. It just means it is hard to find the information.
Ms. Finn. Correct.
Mr. Roe. Not that VA is hiding anything or anything like
that, it is just that they are not--well, we will find out in a
minute what they are doing.
Any other comments about that? If not I have no further
questions.
Ms. Finn. No, sir, I don't.
Mr. Johnson. I thank the gentleman for yielding back.
At this time I would recognize the gentleman from Georgia,
Mr. Barrow.
Mr. Barrow. Thank you, Mr. Chairman.
Ms. Finn, thus far we have been talking about the subject
of knowing what you are getting with goods and services. We
haven't talked so much about when you get what you bargain for,
but making sure we get what we are paying for. But when we get
it it has not been as much a part of your testimony as I have
gathered. I note you say that the subject of contract schedule
slippage hasn't been the main focus, you have been focused
mainly on performing field acquisition review, and it sounds
like your focus has been not so much on when we get what we are
paying for, but what we are getting and whether we are getting
what we are paying for, and I want to talk about the subject of
when we are getting what we are paying for or waiting for,
because all the problems that you describe and talk about are
much more--are aggravated greatly by the decision about when to
decide to build something.
Take in my situation, for example, we have been on the
ready line for a community-based outpatient clinic (CBOC) in
Statesboro, Georgia, for 4 years now and we have gotten
conflicting reports from the VISN, from the Secretary's office,
as to when the thing is going to get built. And it disturbs me
greatly when in response to our last inquiry about this, we get
response from the VA that basically talks about what is going
on in Hinesville, Georgia, a very different project in the
adjoining district represented by my colleague, Jack Kingston,
not at all responsive to the inquiry we were pursuing for years
about trying to get something built in Statesboro.
What can you say about the process about how we go about
deciding where we are going to build things like community-
based outpatient clinics? How is that process working?
Ms. Finn. Unfortunately, Mr. Barrow, I can say very little
about it, and mainly because we just have not done any
comprehensive work to look at that process.
Mr. Barrow. Well, I am going to tell you, that is something
of real concern to the folks that I represent, because it is a
part of VA policy to try and provide the services on a local
basis that are needed on a local basis, the health care, the
mental care, the things that can be delivered locally greatly
reduces the burden on the constituent population of having
traveled long distances to get the so-called free care they
have been promised that they bargained for, and to offer that
promise on the one hand and then be dangling out the prospect
of a CBOC in a hugely under-served area like I represent.
You have folks in Augusta who are just ready to go to
include these folks in their network. They want to get going on
this. You got the constituent population in the five county
areas surrounding Statesboro that is just dying to get local
care so they don't have to drive an hour either to Dublin or to
Savannah, or worse yet to farther places in order to get the
low maintenance, high-impact care they can get through a CBOC,
and we have not gotten a straight answer yet as to when that is
going to happen.
So in addition to all the things that you are occupied with
there, are those of us who are still waiting to find out when
we are going to get in line to experience all the problems that
you are grappling with.
So I thank you for your diligence in focusing on your part
of the problem, but understand as well the part of the problem
of deciding where we are going to build things and when we are
going to build them. If you can take that issue up, please, we
definitely would like to follow up with you.
Mr. Chairman, with that I yield back.
Mr. Johnson. I thank the gentleman for yielding back.
I now recognize the gentleman from California for his
questions.
Mr. McNerney. Thank you, Chairman Johnson. Good morning and
thanks for coming this morning.
One of the things I hear you say and I read from your
written testimony is that the eCMS system is overly cumbersome,
or at least that is what some of the employees are reporting,
but procurement is somewhat subjective, by its very nature you
have to look at different bids, you have to make a decision
whether they can provide and so on, so any computer driven
system is going to be cumbersome.
So what I would like to know is, is there a better system
out there than eCMS, could you answer that question, that you
are aware of?
Ms. Finn. I am not aware of any other system that does this
type work, so I really can't give you an opinion, I am sorry.
Mr. McNerney. Well, the VA is a big organization, it has
lots of contracts, it seems to me that it is big enough to be
able to go to whoever produces eCMS and say we need these
changes to make it more responsive to our needs. Is that
happening that you are aware of?
Ms. Finn. As I said earlier I believe they are working to
implement one of our recommendations related to improving the
technical performance, I don't have the details with me of
exactly what steps they are taking, but I would imagine Mr.
Haggstrom will be able to give you more information.
Mr. McNerney. One other question about the eCMS. Is that
private or public? Is it publicly available software or is it a
private that you have to purchase?
Ms. Finn. I believe that it is privately developed and
proprietary.
Mr. McNerney. Okay. Do you know if there is anyone here
from eCMS this morning or if they are paying attention to this
hearing?
Ms. Finn. I do not know, sir.
Mr. McNerney. Okay. Well, I hope they are. And I would
recommend that the VA use its purchasing clout to work with
them to make the system more easily responsive.
And I certainly appreciated my colleague Mr. Roe's comments
about enforcement. How do you think we can ensure greater
oversight and transparency of the VA system in general?
Ms. Finn. I think we can ensure greater oversight by
continuing to provide oversight from your side and also from
mine. You know, as we continue to look at things we do see
improvements. Continued attention makes a difference.
Mr. McNerney. Well, you know, I have been in private
industry for many years, you know, the purchasing and
contracting is a black art, and the more that you work within
that the more that you can make it responsive. So you know, the
statement that the VA employees don't think that the--they
think the system is too cumbersome, it takes too much time, no,
those excuses don't fly with me and they don't make sense.
So we are going to have to keep an eye on that as we move
forward. And thank you for your testimony.
Mr. Johnson. I thank the gentleman.
With the Committee's indulgence I have another couple of
questions, and so I am going to go into a second round here and
we will try to make this brief. If any of you have additional
questions, gentlemen, we will get to those too.
Ms. Palmer, would you read back again what you said earlier
in your survey what people said were the distractions or the
reasons why they were not using eCMS?
Ms. Palmer. Yes. The survey respondent stated that eCMS is
not used consistently due to personnel shortages, time
constraints, heavy workloads, inadequate training, conflicting
guidance, it is a slow and cumbersome system, and they received
conflicting guidance on its usage.
Mr. Johnson. Okay. As a former Chief Information Officer
(CIO) myself and with other 30 years in information technology
(IT), I can certainly relate to the technical aspects of a
cumbersome system. Outside of the technical aspects though, and
I will address this to Ms. Finn, and to both of you actually if
you would like to respond, outside of the technical aspects of
the system, and it is subjective whether that is cumbersome or
not depending on the user, every one of the other reasons for
inconsistent use are management decisions, right? I mean that
is what management is supposed to do is to provide training.
Training is an integral part of the acquisition of a system
like eCMS. Everybody has workloads to deal with, and certainly
time constraints.
It seems to me, eCMS, that kind of system that does
contract writing is designed to break down time constraints.
And I would appreciate a response from both of you. Would
you agree that the inconsistent use reasons given are primarily
focused around management issues?
Ms. Finn. Yes, sir, I would agree that those are management
issues. We obviously had a recommendation related to training
from this report and VA did provide a great deal more training
and address some of the other management issues such as having
conflicting guidance as to what people were expected to do.
As VA worked to obligate money from the Recovery Act it
mandated that every contract, no matter what size, funded with
Recovery Act money be completed in eCMS, and as we looked at
those contracts we didn't find any lapse with the contract
being there, but we did still find problems with some of the
documentation being there.
But yes, they are management issues that will take
continued attention in order to address.
Mr. Johnson. Okay. Ms. Palmer, any comments on that?
Ms. Palmer. No, sir, I don't have anything else to add.
Mr. Johnson. Okay, all right. Thank you. That is my last
question. I will see if our other Committee Members have,
standing in for the Ranking Member, Mr. McNerney, do you have
further questions?
Mr. McNerney. Yes, I do. Actually one of your statements is
that you have trained 14,000 VA employees annually and that is
a pretty big number of people to train effectively in a year.
Ms. Finn. Yes, sir, that is in fraud awareness. We provide
regular briefings to people in VHA, as well as the Veterans
Benefits Administration on issues that they should be aware of
as managers and people on the front line who might see fraud
situations.
Mr. McNerney. How much effort is devoted to training people
in the eCMS system?
Ms. Finn. From the OIG Office we don't provide that
training. The Department provides that training.
Mr. McNerney. So you are not aware of how much training is
involved?
Ms. Finn. No, sir, I am not.
Mr. McNerney. If we were to hold a hearing a month from now
and ask you to provide names of managers at the VA that are
falling down in terms of their employees complying with eCMS
could you do that?
Ms. Finn. A month might be a very short time in order to
give you comprehensive information.
Mr. McNerney. What would be an appropriate time frame?
Ms. Finn. Several months at least I would think. I don't
know, because I don't know the scope of what we might need to
look at. If we were trying to make a determination across the
entire Department that would take quite a long time.
Mr. McNerney. And in your opinion would that be something
that would be effective in terms of enforcing compliance with
eCMS?
Ms. Finn. It would certainly get their attention.
Mr. McNerney. I think it would, yes. All right, thank you,
that is my last question.
Mr. Johnson. Thank you. The gentleman from Tennessee no
further questions? Mr. Barrow from Georgia? I am sorry, Ranking
Member Donnelly returned. Mr. Donnelly, do you have any further
questions?
Well, on behalf of the Committee, ladies, Ms. Finn and Ms.
Palmer, thank you so much for your testimony today. We look
forward to moving forward with you on ensuring a well managed
contracting process for construction at VA. You are now
excused. Thank you.
Ms. Finn. Thank you.
Mr. Johnson. And I invite the second panel to the witness
table. I now welcome Mr. Glenn D. Haggstrom, the Executive
Director of the Office of Acquisition, Logistics, and
Construction at VA. Mr. Haggstrom is accompanied by Mr. Jan
Frye, Deputy Assistant Secretary of the Office of Acquisition
and Logistics at VA, and Mr. Robert Neary the Director of the
Service Delivery Office in the Office of Construction and
Facilities Management as well as the Acting Director of the
Office of Construction and Facilities Management at VA.
Mr. Haggstrom, your written testimony, your written
statement, will be included in the hearing record and you are
now recognized for 5 minutes. I sense you folks have been here
before probably so you know just to hit the talk button.
STATEMENT OF GLENN D. HAGGSTROM, EXECUTIVE DIRECTOR, OFFICE OF
ACQUISITION, LOGISTICS, AND CONSTRUCTION, U.S. DEPARTMENT OF
VETERANS AFFAIRS; ACCOMPANIED BY JAN R. FRYE, DEPUTY ASSISTANT
SECRETARY, OFFICE OF ACQUISITION AND LOGISTICS, U.S. DEPARTMENT
OF VETERANS AFFAIRS; AND ROBERT NEARY, ACTING DIRECTOR, OFFICE
OF CONSTRUCTION AND FACILITIES MANAGEMENT, U.S. DEPARTMENT OF
VETERANS AFFAIRS
Mr. Haggstrom. Thank you, Mr. Chairman Johnson, Ranking
Member Donnelly, and distinguished Members of the Committee,
thank you for the opportunity to appear before you today to
discuss the Department of Veterans Affairs Acquisition,
Logistics, and Facilities Management operations.
It is a privilege for me to represent the many dedicated
and hard working professionals and provide mission critical
support every day to necessary contracts, logistic support, and
facilities are available for some of our Nations most
extraordinary citizens, veterans.
The Office of Acquisition, Logistics, and Construction was
formed in October 2008 to support the construction needs of the
Department of Veterans Affairs. Those organizations were
brought together to provide an enterprise approach to policy,
process, and systems necessary to support these similar
functions resident in each of the VA administrations.
The core responsibilities and an integrated acquisition
model were affirmed by the Secretary on April 2010. Together
the structural and process changes will enable the Department
to serve our internal customer's needs and ultimately our
veterans in a more efficient manner.
OALC has six fundamental roles in the operation of the
Department. Achieve clear ownership and accountability of the
VA contracting mission, gain control over acquisition and
facilities management information, effectively manage the
acquisition life cycle for contracting and construction,
develop critical human capital resources, enhance information
management to support corporate decision-making, and finally
improve service delivery.
With the focus of today's hearing on VA's Electronic
Contract Management System and the major construction program I
would like to inform the Committee on where we stand with
regard to completing the recommendations identified by the OIG
in each of the reports.
Currently OALC has two VA OIG reports with four
recommendations that remain open. As part of OALC's continuous
improvement process the findings and recommendations of all OIG
and GAO reports are captured, analyzed, tracked, and acted on.
First, the audit of VA Electronic Contract Management,
eCMS, published in July 2009 identified eight recommendations,
five of which the OIG has closed. Significant progress has been
made through management actions to complete system user
training with training teams available to the administrations
upon their request, putting in place oversight programs at the
administration and headquarters level to review eCMS usage, and
the ability to perform real property leasing functions within
the system is in use.
Three recommendations remain open. The recommendation to
develop and implement a VA wide eCMS policy and handbook to
ensure consistent use and compliance with the system
requirements is nearing completion. We completed developing and
providing an integrated role base matrix for using the
individual eCMS user guides in the December 2010 release of the
system. The remaining action to complete policy revision will
be completed by the end of this month.
The second open recommendation deals with the technical
performance of the system. In response to this, we have
completed phase one of our technical refresh in January 2010
with phase two scheduled to be completed in June of this year.
The refresh include server replacement, software changes to
increase performance, and expanded data repository capacities.
Finally, the remaining recommendation was to determine
feasibility of integrating eCMS with the integrated funds
control point activity accounting and procurement system to
streamline the procurement process. The integration software
that has been completed and tested and is scheduled for
production roll out in the first quarter of fiscal year 2012.
The other of VA's major construction contract award and
administration process identified four recommendations with one
still remaining open.
Successfully closed were recommendations to establish
effective mechanisms to monitor contract slippage and ensure
the timely close out of major construction projects and develop
a staffing plan to ensure quality assurance responsibilities
are met.
In the remaining open recommendation, OALC is developing
written quality assurance policies and procedures and program
performance measures addressing all quality assurance services
areas of responsibilities. Phase one of this recommendation was
completed in December of 2010, and phase two will be completed
in June of this year at which time we will recommend to the OIG
that the report be closed.
Also in 2009, the U.S. Government Accountability Office
(GAO) issued a report on VA major construction noting that VA
generally met GAO best practices for a Federal major
construction program in 10 of 12 areas. From that report came
two recommendations that VA fully supported and is in the
process of implementing.
First, the use of an integrated master schedule, and
second, conducting a risk analysis based on the projects cost,
schedule, and complexity. Both of these recommendations will be
completed this fiscal year at which time VA will have
implemented all 12 of GAO's best practices.
As proud as we are of the many improvements in VA's
acquisition and facilities management operations we recognize
the need to continuous improvement and will work diligently to
maintain the confidence of the American public and the
Congress.
Mr. Chairman, we appreciate the opportunity to discuss VA's
acquisition, logistics, and construction operations with you,
my colleagues and I are available to answer your questions.
[The prepared statement of Mr. Haggstrom appears on p. 40.]
Mr. Johnson. Thank you, Mr. Haggstrom. What is the purpose
of using eCMS?
Mr. Haggstrom. The purpose of eCMS is an electronic
contract writing system. As the requirements of our contracting
officers have increased over the years for reporting certain
measures, data up to the Federal procurement data system, the
complexities of the contracting business at large, the majority
of executive agencies have brought on these contract writing
systems to have a central repository for our contracting
officers to develop those contracts and do any modifications or
keep track of what is happening with that specific contract.
This information, if you will, then flows to what is called
the procurement data system, which is system of record, if you
will, for the Federal Government, the Federal procurement data
system, and it also tracks much of the same information that is
resident in eCMS.
The eCMS, if you will, performs that back shop capability
of the details that surround the contract.
Mr. Johnson. Do you consider eCMS an effective tool?
Mr. Haggstrom. There are always improvements that can be
made to integrated systems. I believe it is.
In my past workplace, I was part of bringing online a very
tool similar to this, the integrated acquisition system.
All of the Federal agencies that I am aware of, the large
procuring offices have done this as part of the government's e-
procurement initiative, and while each of the agencies uses
different types of the software and protocols, in general when
you look at electronic contract management systems across
government they are very similar in terms of the performance
and capabilities that they have.
Mr. Johnson. Do you consider eCMS as being properly used by
the VA at this point?
Mr. Haggstrom. Mr. Chairman, we agree with what Ms. Finn
was saying. eCMS is not used to the full capacity and we
recognize that, and I believe there are two components to that.
First is the technology component, if you will, and then I
believe it is our responsibility as the headquarters and the
provider of this system to ensure that what we have in terms of
the system meets the performance requirements of our people,
and that includes the training and the functionality and the
response time, and all of these things were noted in Ms. Finn's
testimony that they looked at several years ago.
The second piece of that is exactly what was discussed with
the previous panel, and that is the management, and that is the
accountability of our mid-level managers and our senior
managers who are out in these contracting offices throughout
the VA to ensure the enforcement of this policy and work with
their people to ensure that they are using the system as it has
been mandated to be used.
Mr. Johnson. When did that management accountability
process begin? I mean you heard the testimony of the previous
panel, 20 of 29 contracts written by the Office of Acquisition,
Logistics, and Construction totaling over $10 million were not
correctly developed and entered into eCMS. You have heard
figures of 87 percent.
I have been a leader, I have been a commander, I have been
a senior executive in business, how long does it take to
address these management issues?
Mr. Haggstrom. Unfortunately, in this particular case, it
has taken much too long. If I could ask Mr. Frye, who is also
the senior procurement executive for the Department to comment
on the implements of the system that took place back in 2007.
Mr. Frye. Yes, if I could take you back a little bit. I
arrived here at VA in fiscal year 2006 and discovered VA had no
contract writing system. I was astounded given the fact VA is
the second largest Federal Government organization. We were
literally writing contracts using Microsoft Word, I referred to
it as writing contracts on the backside of an envelope.
So we set about immediately to implement a contract writing
system. VA spent just a little over $20 million, implemented it
across the entire enterprise, and we completed implementation
and were fully operational and capable by July of 2007.
Following up on what Mr. Haggstrom said, this is a system
we use to write contracts, but it gives us a reputable,
measurable process in doing so, it gives us an all important
database so we can punch the button literally and know how many
contracts we have across VA, the dollar amounts and that type
of thing.
Mr. Johnson. Mr. Frye, I apologize, my time is up. We are
probably going to have a second round, we will get back into
this a little more. I will give you something to think about
though.
Four years later, $20 million of American taxpayer dollars
and we have a system that is not being used for the most part
when you consider previous testimony, 83 percent of the data
not being in the system. That is a long time and a lot of money
being spent with very low return on investment by the American
taxpayers. Something is wrong here and I hope we can get into
that.
I am going to yield to Ranking Member Donnelly now for his
questions.
Mr. Donnelly. Thank you, Mr. Chairman. I will throw this
out to all of you. What do you think is the most important next
step you can pursue to make eCMS work better, to make a
contract system work better? If you had your choice what next
on your plate is the most important thing to do?
Mr. Haggstrom. I think it is a continual process. You are
never going to complete this process because people forget. We
continually have new folks in the contracting business coming
into the Department, so there is always this continuum of
requirements.
I think one of the most things is training. Providing the
adequate training to our people for them to be able to use the
system, understand the system, and exploit its capabilities,
and this training is provided at the request of the
administrations, but also when a new contracting officer joins
the Department they are required to go through a 4-day course
at the VA Acquisition Academy to understand and learn the
system and how to use that system.
Mr. Donnelly. Do you have a course book for the VA
Acquisition Academy? Like when that person comes for 4-day boot
camp, do you have a book that you give them that tells them
here is how eCMS works, here is when you do contracts we expect
it to be handled?
Mr. Haggstrom. We do have a course training guide that is
left with the folks. Also because the eCMS system is web-based,
all those instructional training and how do guides are resident
within the system so that if the user has a question they can
go to what we call our acquisition resource center, which is
imbedded as part of this integrated technology, where they can
go and they can look up questions, find the answers, and then
apply that to that particular problem they experience.
We also have a very robust help desk for eCMS that at any
time a user can call the help desk and seek help from a staff
of professionals who understand this system and can lend them
advice on how to move forward with their problem.
Mr. Donnelly. So I guess the next question is, we have a
lot of tools, how do we make sure these tools are used more?
How do we get more people on it? Are there parts of the country
that are doing better than other parts in the VA operations?
Mr. Haggstrom. There are. When you start to peel this back
if you look at it there are certain operations and areas with
the administrations who are if you would call super users where
all the contracting officers are using it and there are other
areas where they are not.
And I think that goes back to the point that Mr. Frye was
making and Ms. Finn was making, is we are looking at this now,
this has to be a leadership issue where those mid-level
managers and those senior managers take accountability for
their folks to enforce what the Department has issued as
policy.
Mr. Donnelly. It would seem that if some places are doing
really well and some places are not doing well at all and they
both have the same materials then maybe it is not the
materials, maybe it is just as you said, a leadership issue of
how do we get the same skill set that has enabled certain areas
to shine, how do we transfer that same skill set to those areas
that haven't, and I hope you guys are taking a look at that.
Mr. Haggstrom. We are. In fact certainly one of the primary
users of this system is the Veterans Health Administration as
you can well imagine as being the largest administration within
the Department.
Mr. Fred Downs, who is the head of contracting activity for
the administration, has implemented specific metrics that look
across the operation in VHA at the VISN level to look at the
usage of eCMS and the reconciliation of any errors that are in
eCMS.
So there is special attention being paid in the
administrations on the usage of eCMS and how they can improve
that usage.
Mr. Donnelly. I think one of the things we would be real
interested in seeing is if you set up metrics for how to
transfer this knowledge, this talent, this ability of the
places that are doing well to the ones that aren't. Is there a
plan? What is that plan? What kind of timetable is there for
that plan? That kind of thing so that, you know, the folks who
are steering the ship the right way can teach the folks who are
going around in circles how to start pointing the ship in the
right direction.
Mr. Haggstrom. Absolutely. About 2 years ago we established
a program management office within Mr. Frye's organization
specifically dedicated to eCMS, and Ms. Harvey, who is the
Executive Director of that organization, has user forums of the
folks out there who actually type it on the keyboard, if you
will, to continually get feedback from them on what the issues
with eCMS are, how we can improve the system from a technical
stand point, and the priority of which these issues are
tackled.
Mr. Donnelly. Well, thank you very much, I am out of time.
Thank you, Mr. Chairman, I will yield back.
Mr. Johnson. I thank the gentleman for yielding. The
gentleman from Tennessee?
Mr. Roe. Thank you, Mr. Chairman.
You know, we are here to provide the best services and care
for veterans, that is the purpose of this VA, and also to watch
after taxpayers dollars so that those dollars get down to
actually providing services for veterans.
And let me just tell you a little bit of my frustration
about this morning. I got your testimony here at the 5 minutes
till the time this Committee started. I sit down the night
before and read all of these. And I had a book last night that
my staff spends time preparing, but there was nothing in here
from your group. And I am wondering if you were responsible for
making sure that all of this gets done wouldn't it be good if
we had had this yesterday so I could have read your testimony
yesterday? And I don't know why you didn't get it here until 5
minutes till 10:00, but all I heard was your testimony. I
didn't have a chance to read it, to analyze it, to think of
some questions. That is just a comment.
To Mr. Barrow's point I want to get to some things that you
were talking about just a minute ago and how on a cost analysis
who conducts these cost analyses, and I think that is what eCMS
is about. How do you make these decisions about whether a new
construction site should occur, whether you should renovate
one, and then how do you follow that construction? How do you
follow that money to make sure we are getting it? And I am
going to get that point second. So how is that down first of
all?
Mr. Haggstrom. Mr. Roe, eCMS is not designed to do that.
eCMS is not a decision-making tool for the construction and
facilities management process in terms of determining site
locations, in terms of----
Mr. Roe. Okay, that is fine, then you have answered that
question, that is done another way.
Mr. Haggstrom. It is.
Mr. Roe. But if you have a contract and that is entered
then you can find out if that contract is being implemented or
written properly and followed properly am I right?
Mr. Haggstrom. That is correct.
Mr. Roe. Okay, then the reason I guess that leads to
another question I have that is when you were evaluating these
things there was a project I think out in Denver or some place
out west--in Denver where a replacement medical facility had
been appropriated money in 2004, 2006, 2008, 2009, and 2010
with a total cost of a half a billion dollars for 40 beds.
Well, I just helped at home build a hospital with 120 beds
that was a fraction of that much money.
How in the world does something like that happen if there
is any oversight that I or another Congressman here can go look
at? How could that ever happen?
Mr. Haggstrom. Congressman, if I may, Denver was a
situation where the scope was continually changing on that to
decide whether or not we were going to have bed towers the
example or not have bed towers, what size the facility was.
I would ask Mr. Neary, who is the Acting Director of
Construction of Facilities Management to comment on that if I
may.
Mr. Roe. Thank you.
Mr. Neary. Thank you, Congressman Roe.
Mr. Johnson. Mr. Neary, would you press your talk button,
please.
Mr. Neary. Thank you, I apologize.
The Denver facility is not for 40 beds, but it is 184 beds,
it also includes a very large outpatient component. But you are
correct that the project was incrementally funded over a period
of years.
And one of the areas that VA has identified as needing
improvements is in the early planning of major construction
projects and looking forward to having a multi-year program
plan so that prior to our introducing a major construction
project in the budget we have a better handle on what is to be
constructed.
In the case of Denver, it was originally identified as a
project that would build a replacement hospital, then a
decision was made to lease hospital beds from the University of
Colorado Hospital and only build an outpatient clinic.
Over time and engaging with stakeholders, it was determined
to switch back to a full service replacement medical center and
that is under way now. We have just awarded the first
construction contract associated with the building of that
facility.
Mr. Roe. Well let me just, Denver is a 40-bed increase in
the number of beds they had, and I will just tell you, you
would never in a million years spend your own money that way.
There is no way on this earth that in a private business you
could survive that. A hospital can't make that kind of a goofy
decision now because of the income they have to pay for their
debt load, they can't do it.
And I think that what we are all getting to here is that we
want our money, our tax dollars, your tax dollars spent as
efficiently as we can so that the veterans get the care they
need, and to spend a half a billion dollars, that is a lot of
money on a project. I mean we could have spent a lot of that
money for Mr. Barrow to have an outpatient clinic in his
district, you could have had ten of them for that much money,
or 50 of them.
And so I guess my frustration is, is that when we are
spending the taxpayer's dollars we don't seem to be looking
after them like they were our dollars, which they are.
Mr. Neary. Well, I believe we are, and we certainly should
be, it is very important to do that. In the selection of
projects going forward the cost analysis is performed in terms
of renovation versus new construction, construction versus
leasing in an effort to make sure that the appropriate project
is selected to be funded.
Mr. Roe. Okay. Thank you, I yield back. Will we have a
second round?
Mr. Johnson. Yes, we will.
Mr. Roe. Thank you.
Mr. Johnson. Thank you for yielding. Mr. Barrow.
Mr. Barrow. Thank you, Mr. Chairman.
Mr. Haggstrom, you heard my questions to Ms. Finn in her
capacity as Assistant Inspector General for Audits and
Evaluations, she doesn't really get into the area and certainly
wasn't getting into this morning the area of deciding what to
build and when to build it, and she was given sort of an
appreciation of what she is able to do.
You, though, as Executive Director of the Office of
Acquisition, Logistics, and Construction certainly are in a
better position to help me understand just how it is we decide
what to build and when to build.
You are quite right in response to Dr. Roe's questions,
eCMS is just sort of like a super duper checklist for what to
do when you were building something or going to do something.
My question to you is, help shine a light on the process
for deciding when and where are they going to build something
like community based outpatient clinic? Tell me how that is
done.
Mr. Haggstrom. I will certainly attempt to do that, sir.
When you look at the process, the process begins with the
users at the administration level, and in this case for the
CBOCs or HCS, the major medical centers. So based on the
modeling that VHA uses they look at the demographics, they look
at the future population and things like that in terms of
determining what the needs are of VHA to serve our veterans.
Mr. Barrow. At this point it is beginning to sound like you
are describing the management counterpart of a super duper
checklist like eCMS. My question is not how you do it, but who
does it?
Mr. Haggstrom. As I said the, requirements generation is
built by the administrations, the user. As we spoke to the full
Committee last week on the implement----
Mr. Barrow. But different users don't establish priority
between themselves, for example. I am here to tell you that the
folks at the Charlie Norwood VA in Augusta are all hell bent to
get this thing done. We were encouraged and told by the folks
at the VISN, the folks at the Georgia Department of Veteran
Services and by the VA to poll the constituent community, and
we got input as to thousands of families that would benefit
from having this. We more than met the criteria.
The question is, when do you decide what order you go in?
We got one that has come online that wasn't even started in
Georgia until after we had already submitted our petition
showing 5,000 people within a 30-mile area of Statesboro ready
to participate in this with all the benefits they get from
this, and we find the one in Hinesville, just down the road, is
going forward. When we ask about Statesboro we are getting a
letter that is actually talking about what is going on in
Hinesville, telling us don't worry.
It really bothers me that in urging action in what we have
been promised for many years that might be interpreted by
somebody in the VA as saying we are urging support for further
progress in Hinesville. I mean, I don't even know if folks know
what we are talking about when reaching out to the VA to find
out what the status is.
So when it comes to issues of competing priorities,
scheduling things in, putting things in the pipeline to be
developed who actually makes that decision? Is it done at the
Secretary's level?
Mr. Haggstrom. It is. It comes up through the governance
process in the Department, the Office of Management is
responsible from a planning and budgeting perspective to take
all these requirements and do an integration and a
prioritization and then make those recommendations to the
Secretary in terms of what the program would look like in that
respective fiscal year.
Mr. Barrow. Well, we have that. We had actually made that
much progress, we have gone well beyond that, and we have been
told that the matter is actually been sitting on the
Secretary's desk for quite some time now. What can we do to get
something going?
Mr. Haggstrom. Congressman, I wish I could give you a
better answer. Once that decision is made I can assure you my
office takes action immediately. If you will, my offices are
responsible for the execution. And I don't mean that to sound
as an excuse.
Mr. Barrow. Again, I recognize I am coming to this from
another--but you are closer to it than I am.
Mr. Haggstrom. As soon as that decision is made, sir, we
action it immediately, and in the case of the CBOCs where they
are normally a build lease facility, we will implement our
leasing process, which is a two-step process. Basically first
finding the land, and then second, finding a developer.
Mr. Barrow. We have actually gone so far in Statesboro as
to offer sites that have actually been inspected and evaluated
for suitability either for conversion, adapted for use as a
CBOC, and otherwise.
What role do your counterparts in State government, say the
Department of Veterans Service in Georgia play in either
advocating for or serving as a check off on the list of folks
to consult? What role do they play in advocating for some of
us? Anything at all? Do you all listen to the folks in Atlanta,
for example, at the Georgia State Department of Veterans
Service?
Mr. Haggstrom. I am not aware of any formal role that the
Veterans Health Administration may use in terms of reaching out
to various other government agencies. When you look at the
major medical centers and the operations within VHA, their
relationship with communities and community's leaders is
usually very good. And so that would usually reside at that
particularly operational level to reach out to the community
leaders, talk to them about the needs of the community, perhaps
discuss with them where an optimum location may be, and even to
say is there land that the community might be willing to donate
for this particular effort.
Mr. Barrow. Thank you. Thank you, Mr. Chairman.
Mr. Johnson. Thank you very much. Hold on just a second, we
are getting a message from Natural Resources. Just to keep
everybody posted I will have to go vote at a markup at Natural
Resources in about 15 minutes, so we will recess at that point
and reconvene.
Go to Mr. McNerney, now. Thank you.
Mr. McNerney. Thank you, Mr. Chairman.
I had the opportunity to express my frustration at a
hearing on a different Subcommittee a couple weeks ago about
how long it has taken to do a project in my district, and it
took about 2 years to decide what county to put the project in,
it took another year, and it hasn't been decided yet what
location within the county to put the project in.
Are we going to be continuing to experience that sort of
longevity and process decision-making in the organization or is
there a way to speed this thing up? I mean it is very
frustrating, we have veterans waiting for service and we have
extremely high unemployment. It is a very frustrating
situation.
Mr. Haggstrom. I understand your frustration, Congressman.
When we look at the planning function, which again begins
with the Veterans Health Administration for our CBOCs, they
have a very deliberate process in terms of looking at the
veterans demographics, where those veterans are located, the
proximity to other major medical centers where we may have
affiliate relationships, what the scope of the requirement may
be in terms of the size of the facility. We look at various
things like accessibility, the size of the land, transportation
issues, the surrounding activities that would service that
CBOC. All those things are taken into consideration.
Mr. McNerney. Well, I mean these are all important
considerations, granted, but every year of delay adds five to
10 percent to the cost of the project, so there has to be a way
to speed up this process. I don't know if you have an answer to
that, but I am just telling you it is going to be something you
are going to hear about from me until I feel like there is
progress made.
I do have a question regarding to the eCMS system. Now what
I am hearing is that there is a certain lack of oversight and
that causes a waste of money maybe through fraud, maybe through
mismanagement, I don't know, but I would like to get from you
some idea of how much money is actually not being spent
effectively as a percentage of total expenditures and how that
might compare to a similar situation in a private corporation
like Ford that might be the same size.
Mr. Haggstrom. Congressman, I do not have that number, nor
do I have an idea on how we may do that.
I do wish to say though that I do not believe one, that
eCMS would preclude fraud. Fraud is perpetrated by our vendors
or very intentional acts of trying to deceive the government.
The eCMS will not prevent that.
I do believe when you look at the contracting actions as
Ms. Finn said, while all the documents may not be resident in
eCMS that we would like to have in there from a standpoint of
be able to do data mining, that does not mean that the
Department is not getting best value for the contracts that
they do let, and that process is a very deliberate one in terms
of ensuring competition, ensuring that the requirements
generation adequately describes what our requirements are, and
then implementing that contract.
Mr. McNerney. So are we barking up the wrong tree here by
singling out eCMS in terms of waste of fraud and abuse?
I mean some of the questions I am hearing reflect my
frustration here with the testimony this morning, but I would
like to have some way to measure what is going on and identify
bad players if possible, including bad players within the VA.
And are there statistical measures, are there quantifiable
measures that we can set down and ask you to come back with us
in a month and say well, these are the bad managers, is that
something that is possible?
Mr. Haggstrom. We do have a series of metrics in the
acquisition community that we look at. One is the usage of eCMS
and the accuracy of the Federal procurement data system. So we
are looking at these performance measures in terms of how the
systems are being used.
Mr. McNerney. And that is something that you can bring to
this community if we ask you too?
Mr. Haggstrom. We can.
Mr. McNerney. Okay, thank you.
Mr. Roe [presiding]. I guess we will now go into a second
round of questioning if that is all right with the panel.
In the world I lived in when we had a contract as a mayor
we had an idea we wanted to build a school and we would have an
architect, we would define the need in one do you need the
school, and we would get an architectural firm and we would bid
that out, we had a bidding process through local or whoever
wanted to bid on that. We would select the architect, the
architect would then design the plan. We then let the contracts
and you have an opening of a single bid, you would have all the
specifications and you would do that, and then you would have a
project manager that was independent of the construction crew
that was doing. And you would hold money back and you would
evaluate as you were going along. That is how I have done a
gazillion projects. If it is a road project, a school, or even
in my own practice a building like that, we did a similar
process of selecting an architectural firm and so forth.
Who is in charge of actually doing that? Let us say they
are going to build a CBOC in his district, heaven forbid maybe
it will some time happen in your lifetime, but if we are going
to do that how is that process and how do you oversee that
going along to be sure that that money is just right? Who is
responsible for that?
Mr. Haggstrom. Certainly. Mr. Roe, the process you
described that you used in the private sector is very much like
the process we use in the Federal sector with the exception of
very rarely do we use sealed bids anymore.
We are more in line in best value in terms of what the
private sector brings to us in terms of a proposal and the
design of the ultimate facility.
I would ask Mr. Neary, whose Office of Construction and
Facilities Management is responsible for the life cycle of the
major construction program to explain to you a very deliberate
process that we use from the inception to the commissioning of
those facilities.
Mr. Roe. And the second thing, you can answer these at the
same time, the North American Industry Classification System
(NAICS) is a standard that you have in picking firms that are
qualified to do a job. Would you ever pick a firm that didn't
meet those qualifications?
Mr. Haggstrom. If I understand you the North American
Industry Classification System does not qualify a firm to do
the job. All that standard represents is the category of
services that that particular business offers. It has
absolutely no bearing on whether they are qualified to perform
the job that we are asking them to do.
Mr. Roe. How do you figure that? How do you decide whether
they are qualified?
Mr. Haggstrom. I would like to have Mr. Neary answer that
as part of the process we go through in terms of determining
best value for the ultimate awardee.
Mr. Neary. Sure, thank you.
And Congressman Roe, achieving quality is an extremely
important part of our culture, and in each of the steps that
you described we have a number of mechanisms to bring quality.
When a decision is made to build a facility we will select
an architect. Some time ago back in the 1970's the Congress
fortunately allowed Federal agencies to use a quality-based
selection process, it is called the Brooks Act, so we put out a
notice and architectural firms who believe they have the
credentials to do the design come forward, they are rated and
ranked by a team of experts, and then a short list of those who
are competing are interviewed. They are asked to describe the
quality of their team, who will be on their team, what their
past experiences have been, the strength of their firm, those
sorts of things.
Once selected they are put to work and their work is
monitored by not only our own staff, but typically a peer
review, another architectural firm that we have selected to
participate in reviews. Their work is reviewed at each of the
major milestones in the design process. A design is complete
and approved then put out for a bid.
As Mr. Haggstrom said, we utilize a best value selection
process where we judge the competitors on a combination of
quality factors and price, their experience, the strength of
their team, the quality of the individuals, et cetera, the
strength of their subcontractors that they plan to use.
Mr. Roe. So you don't use a sealed bid.
Mr. Neary. We don't use a sealed bid, no, sir.
Mr. Roe. Why not?
Mr. Neary. It has generally been not only our experience
but experience across the industry that if you take into
consideration the quality of the folks as well as the price you
will get a better contractor.
Mr. Roe. Well, the lowest price doesn't always get ours
either, but I think it is a much--any way, that is the process
you use. I think it is much fairer that way, you get some of
the hanky-panky out of it potentially with a single bid.
Mr. Neary. Okay. Well, as I say, of course we don't do that
presently.
A contractor is selected for a fixed price contract, they
are required to utilize a critical path method tool to document
all the steps that are taken in executing a project. We monitor
the critical path----
Mr. Roe. Okay, I get it. It is sort of like except for the
sealed bid it is very similar. But if we are not getting the
information in there how do you know, how would I know that a
process that it is being done well?
And the other two questions I have for you all is if this
is mandated to put this data in there why isn't it being done?
And second, is there any penalty if you don't do it? If we
are 4 years into it and we are still not using it----
Mr. Neary. The eCMS system is utilized across the entire
VA, thousands of contacts. In my organization where we have
high dollar value contracts, but right now we are working on
about 60 of them, we are very good about using eCMS, we put our
data into eCMS. And so in the case of the major construction
program it is there.
Mr. Roe. So it is there in the major construction. So where
isn't it there? What the OIG just told us it wasn't there.
Mr. Haggstrom. Mr. Roe, the problems we encounter are
within the administrations principally in terms of the multiple
contracting officers that sit out there at the MISN or VISN
network levels that are across the VA to ensure the consistency
of data accuracy and just having them enter data.
And so that while within CFM it is rigorously used,
unfortunately it does not have that rigor across all of VA.
Mr. Roe. So why? And again, back to the no one has answered
it, if it is mandated why isn't it being used? And number two,
is there a penalty? If you don't do it, if you just blow it off
and don't ever do it what penalty is there?
Mr. Haggstrom. As we said why. I think when you looked at
the initial operating capability of eCMS there were some
technical issues. We have addressed those with a technical
refresh in terms of accelerating the speed that the system
responds to you. We have increased the functionality in terms
of making it easier through drop downs and pick lists. So the
issue goes back to the leadership.
Mr. Roe. It is supposed to be up in 2012 I think you said,
and I heard you say----
Mr. Haggstrom. The refresh will be completed this summer
and the technical interface for the accounting system will be
implemented in the first quarter of fiscal year 2012.
Mr. Roe. Okay. I have no further questions.
Now, Mr. McNerney.
Mr. McNerney. Thank you, Mr. Roe.
So I asked this question of Ms. Finn and she wasn't in the
right position to be answering that question.
Is there a system that is better than eCMS that we should
be using? I mean, Mr. Frye, you are the one that selected eCMS
are you not? Is there a better system? Are you working with
eCMS to make sure it is more user friendly and so on?
Mr. Frye. I have worked with a number of contract writing
systems. I spent 30 years in the Department of Defense, 20 of
those working with various contract writing systems. There are
pros and cons as already stated with each and every system.
I think eCMS is a very good system. I think when we
started, when we implemented eCMS, we didn't turn on all the
bells and whistles. We are turning those on now and we are
training our workforce to use the system and I think it is a
good system.
Going back to what Mr. Haggstrom and others have said, it
requires leadership. It requires mid- and senior-level managers
to ensure their personnel are using the system, it requires
senior executives like myself to provide high level oversight
and make changes where required in personnel if need be, in
policies, and in training to ensure we use the system.
Mr. Haggstrom. If I could, Mr. Congressman, and also, Mr.
Roe, you asked about penalties that are incurred. There are no
formal penalties, if you will, in terms of taking your
contracting warrant away from you or not allowing to use the
system. Obviously that would have unintended consequences that
would just play out in terms of not providing those services.
What we have done internally within OAL and what I am going
to bring forward to senior procurement counsel who is a
governance process for contracting is in fact to have as part
of the contracting officer's annual performance plan the use
and complete use of eCMS as mandated by policy, which then
would be reviewed at the conclusion of that performance period
and would be taken into that consideration in that employee's
overall rating.
Mr. McNerney. Well, that is something of a penalty, getting
fired is another kind of penalty.
From the OIG testimony, there were 1,500 procurement
actions in eCMS and 5,800 not in eCMS. I mean that is a fairly
low compliance rate. If that was happening in Ford Motor
Company people would be losing their jobs.
So all I can say is that you have to do better, and as long
as this Committee is holding these hearings, you are going to
be hearing these same questions, so I recommend that you do
what is required.
Mr. Roe. Thank you. One final question and then we will
wrap this up. And I don't know what this was even, but is there
a third-party system called PARAGON? What is that?
Mr. Haggstrom. If I could, Mr. Roe. PARAGON is a system
that is used by Mr. Neary's office and he can comment on the
capabilities of that.
Mr. Neary. PARAGON is a software system that we utilize
presently to track activities with the contractor in terms of
request for information, change order proposals, a variety of
the kinds of things that could go on at a construction site. So
a data management system that we use. That contract will be
running out and we are in the midst of getting a new
procurement either reselect or acquire a replacement.
Mr. Roe. What is the difference between that and the other
system that we are using? Are they parallel systems or why do
you run two in.
Mr. Neary. They are two completely different systems. The
PARAGON system tracks entirely different data needed to manage
the job at the construction site.
Mr. Roe. So it is a completely different system.
Mr. Neary. Yes.
Mr. Roe. One other thing. I want to get back into
contracting a little bit.
Would you all go into a little bit on bundling and contract
splitting and how you follow that?
Mr. Haggstrom. Certainly. If I could ask for Mr. Frye to
comment on that. We take bundling very seriously as we do
contract splitting. We put in place the policy and processes to
preclude that, and Mr. Frye can comment on that.
Mr. Frye. Yes, bundling reviews are required at a threshold
of $2 million. However, VA implemented a policy whereby our
small business office do reviews at the $1 million threshold.
So we are absolutely dedicated to ensuring contract bundling
does not occur.
Our small business office is also required to sign off on
VA Form 2268, which has them concur or non-concur with our
procurement strategies. So we present to them our procurement
actions and they approve by their signature the direction we
are going. And if they disagree with it then we talk and
resolve the differences.
So we get our small business office involved up front and
early, we hold integrated product teams (IPT) to develop our
requirements, and the voting member, a voting member on that
IPT is the small business offices.
So they have ample say I believe, and I think if they were
here today they would say as well, in the process to discourage
and to avoid contract bundling.
Mr. Roe. Now, Mr. McNerney, he was here last year. When the
two of us were here last year we heard some testimony about
someone would get a contract and then wouldn't have the
capacity to carry it out. They would sublet that contract out
to someone else. Are you able to follow that with eCMS or any
of the oversight that you have? And then we found out that some
of that work is not done properly. So the VA has not only
issued a contract to somebody that couldn't do it, they then
subbed it to somebody who couldn't do it.
Mr. Frye. Mr. Roe, this is an issue across the government.
In VA, the way we are addressing this is we have hired a
supplier to come in and do an independent verification and
validation for us. This contract will be put in place this
month. We intend to have this supplier out in the field doing a
continuous survey of contracts and subcontracts to make sure we
don't have this situation as you just described.
In other words when a veteran who owns a small business is
awarded a contract they are required to do 50 percent of the
work of that contract with the veteran business. It would make
little sense for them to hand it off to a large business for
instance to do the work.
So we want to make sure that we keep our small businesses
where they are at, and we are also going to be looking at large
businesses. So if we have large businesses who have come to us
and said we are going to put an aggressive subcontracting plan
in place and we are going to give let us say 15 percent of the
work for small business we are going to be looking at the large
businesses too to validate that they have in fact made a
reasonable effort to employ 15 percent of small businesses in
that work.
Mr. Roe. Now, there is nothing wrong, I mean, the
subcontract people do it all the time in a construction
project, I mean there is nothing wrong with that. You get good
quality work and you can evaluate that work.
I guess this will go to Mr. Neary. Back to Denver again,
because do we have anybody that oversees? Like we would have a
project manager, a separate third party from the contractor do
to that who we typically would do that in the city?
Mr. Neary. Yes, absolutely. First we have a project manager
who oversees the entire project who works for my Office of
Construction Facilities Management, then at the job site when
we are ready to go into construction we have a team of people
that we call resident engineers who are at the job site, they
are not employed by the contractor, they are employed by the
government, and they oversee the work, do inspections identify
issues if there are issues, respond to requests for information
from the contractor and that sort of thing.
Mr. Roe. Any further questions?
I want to thank all of you for being here today. It has
been very informative for me and I think for the Committee, and
I appreciate your testimony, both the OIG and you all, and
appreciate you being here.
I would like to have some follow up, and I think probably
Mr. McNerney would like to have some follow up at some
reasonable point in time. I realize it can't happen over night,
but to see if you are able to implement this to all of the
contracts. It has been 4 years, I think that is a long time.
Okay. Well, our Chairman would like to ask another question
so I am going to hold it open and not close the hearing until
he gets here. He would like to ask a couple more questions
before we close it out.
But I do want to thank you for being here and we will
follow up. I think it is very important that we follow up and
find out where you stand. Do you have any comments?
Mr. Donnelly. No, no comments at this time.
Mr. Roe. We will just recess until the Chairman returns.
Mr. Haggstrom. Thank you, Congressman.
[Recess.]
Mr. Johnson. [Presiding.] This hearing will come to order,
and I thank the panel for indulging me. I apologize for having
to step out and I thank the Committee, although it looks like a
Committee of one now, but I thank my colleagues for indulging
as well.
Mr. Haggstrom, I have a few more questions that I would
like to get into.
You mentioned earlier, one of you did, I think it was in
your testimony that you have a robust helpdesk system
associated with eCMS. I am very familiar with helpdesk systems
and their capabilities. Could you provide to this Committee a
report of the trouble tickets and the resolution thereof of
those trouble calls since eCMS went live?
Mr. Haggstrom. Certainty, Mr. Chairman, we will be happy to
provide that information.
[The VA subsequently provided the information, which
appears on p. 42.]
Mr. Johnson. I would like to see that, and we will
anxiously await that.
I want to talk a little bit more, I know you got into a
little bit before I left, for my benefit tell me what PARAGON
is.
Mr. Haggstrom. Certainly, Mr. Chairman. If I could ask Mr.
Neary to explain that, it is part of the program management
system that they use in construction.
Mr. Johnson. Okay.
Mr. Neary. Certainly, Mr. Chairman. PARAGON is a software
tool that we currently use to manage data of activities that
take place primarily at the individual construction sites
recording requests for information from contractors, change
order documentation, that sort of thing.
And so it enables us to track what is in the house, if you
will, and actions that are being taken, establish deadlines,
suspense dates for accomplishments, and then we can look across
the system at that data to look for trends and any other
information that would be useful in guiding us in moving the
program forward.
Mr. Johnson. Okay. If I look at a side-by-side comparison
of the capabilities that have been advertised for eCMS, eCMS by
your testimony is a contract management system. It includes
tracking project administration, contracting or contract
management, establishing and enforcing standard acquisition
practices and department-wide policies.
If I look at PARAGON it says it is for project--track
project administration, contracting, and maintaining payment
records. When did the VA start using PARAGON?
Mr. Neary. I would have to check, but I would suspect it
was 7 or 8 years ago.
Mr. Johnson. So PARAGON was in place when eCMS was brought
on board?
Mr. Neary. Yes, sir, I believe it was.
Mr. Johnson. If the VA already had a contract management
system that would track the progress of construction projects
then why was eCMS pursued and why did the taxpayers spend $20
million on it?
Mr. Haggstrom. Well, I think if you look at the two
systems--they are very different, Congressman.
One is very focused on construction, management of a
critical path method, management of what takes place throughout
the life cycle of a brick and mortar facility.
The eCMS it was built to not only take care of that in a
general contract sense, but there are also commodities and
service contracts that we put in place, that there was
absolutely no system other than the back of the pad, if you
will, to keep track of that.
What this system did, is then take into account all the
rest of the contracting actions that the Department had to work
with.
Mr. Johnson. Now we know that PARAGON is being used and
that the data that is being placed in PARAGON is being cross-
referenced to eCMS. I am just sort of confused. Well, first of
all, how much did PARAGON cost?
Mr. Neary. I would have to find that out and submit it for
the record, sir.
[The VA subsequently provided the information, which
appears on p. 47.]
Mr. Johnson. Okay. How much training goes into the use of
PARAGON?
Mr. Neary. We provide training for all--it is used
primarily by our resident engineers at job sites, and so any
new resident engineer who comes into our organization we would
provide them initial training, and then we provide periodic
training, refresher training over time to everybody that is
involved in the program.
Mr. Johnson. Does PARAGON fall under the same oversight
mandate that eCMS does? Has PARAGON been mandated as a required
data system?
Mr. Neary. Yes, it has.
Mr. Johnson. How much training goes into eCMS? Do you have
a formal training program for that?
Mr. Haggstrom. We do, Mr. Chairman. The VA Acquisition
Academy has a formal training system where our new contracting
officers attend a 4-day course on a scheduled curriculum. We
also provide field training in traveling teams if the
administrations ask for that. And the Committee has asked for
those training materials to be submitted for the record and we
will do so.
[The VA subsequently provided the information, which
appears on p. 55.]
Mr. Johnson. Okay. When did the training program for eCMS
start?
Mr. Haggstrom. The training program for eCMS started at the
inception of eCMS being brought on in terms of being able to
provide those end users, if you will, the skills necessary. So
it began back in the 2007 timeframe when we started to mandate
eCMS as the system for the contracting officers.
Mr. Johnson. Do you consider it an effective training
program?
Mr. Haggstrom. I believe it has improved much. When you
look at our users in terms of the survey, you are going to see
mixed reactions to it. Some say it was very effective, some say
it was very confusing, some say that they weren't trained on
certain modules.
We take those surveys and we bring them back and we ensure
that we close those gaps in our training and we provide new
training. That survey, I believe, was now done in 2008 or so,
so it is a little long in the tooth, if you will, I think in
terms of gauging the reaction from the users in terms of the
quality of the training we are providing.
Mr. Johnson. Okay. How do you account for the fact that
data is being entered into eCMS not at the beginning of a
contract, but later? Sort of as a second thought.
Mr. Haggstrom. I think that goes back to some of the issues
that the contracting officers have brought forth in terms of
the functionality of the system, the response time, but I would
ask Mr. Frye, if I could, to continue to comment the work.
Mr. Frye. Mr. Johnson, there is a very simple answer to
this one. For the most part, data is being entered subsequent
to contracts being let is from old legacy contracts. We have
made an attempt to put contracts that are still under way that
were awarded prior to the advent of our contract writing system
into that system.
So I think by in large that is the data that is being
entered after the contracts are let.
Mr. Johnson. Mr. Frye, something doesn't match here.
According to the VA testimony prior to us and the information
that we have, 83 percent of the data that is supposed to be in
eCMS is not in there. Are you telling me that only 17 percent
of the data is new contracts and that 83 percent is old data?
Because something is not jiving with what you are saying now.
Mr. Frye. No, what I am telling you is when the contracting
officers--and again, I wasn't out to look at the contracts--but
from what I gather the contracting officers have entered some
of the data, but not all of the data.
In other words, they took a paper file and transported the
paper into electrons, into the contract writing system so this
would become part of your data base. The contract was never
developed using the contract writing system because the
contract writing system wasn't in place in 2005 or 2006.
Now most of our contracts are put in place with a 1-year
base and four 1-year options. So if it was a contract that was
put in place some years ago it wouldn't have been put into the
contract writing system.
Mr. Johnson. So it is your assertion then that 100 percent
of current construction contracts are being entered into eCMS
at the beginning of the project?
Mr. Frye. I can't comment on construction progress, I would
yield to Mr. Neary since he runs the construction program.
Mr. Neary. With respect to the VA's major construction
program, what I am responsible for 99.9 percent, yes, are
entered in at the outset. We award all of our contracts
utilizing the eCMS system.
Mr. Johnson. Interesting.
Changing gears just a bit. According to VA Acquisition
Regulation 801.603-70, a resident engineer is not allowed to
make a commitment that will affect the price, quantity,
quality, or delivery of a contract. Is that correct?
Mr. Neary. Well, an individual who has to be a warranted
contracting officer to make those types of commitments----
Mr. Johnson. But a resident engineer is not a contracting
officer, doesn't hold a warrant, correct?
Mr. Neary. At each of our sites, the senior resident
engineer would hold a warrant, limited I believe it is to
$100,000.
Mr. Johnson. Okay. Likewise, a contracting officer acting
within his or her warranted contracting authority must
authorize any change to a contract. Is that correct?
Mr. Neary. That is correct.
Mr. Johnson. And you are telling me that resident
engineers--you have resident engineers that are both
contracting officers and resident engineers?
Mr. Neary. That is correct. Limited authority primarily
intended to address events that arise, situations that arise at
the job site where the contractor needs to be given direction.
You might have plumbing lines that conflict, something that
wasn't picked up on the drawing, those sorts of things.
Mr. Johnson. To your knowledge do you have resident
engineers then that are not contracting officers that are
making decisions regarding the price, quantity, quality, or
delivery of a contract?
Mr. Neary. I am not aware of any situation where a non-
warranted resident engineer is making those decisions. That
should not be happening, no.
Mr. Johnson. Okay. Well, seeing as no other Committee
Members apparently have any questions I would again thank you
gentlemen for being here today. Let me get back here. And I
thank you for your time and your testimony and you are now
excused.
I ask unanimous consent of all present that all members
have 5 legislative days to revise and extend their remarks and
exclude extraneous materials, and without objection, it is so
ordered.
I want to thank all of the Members of the Committee and
witnesses for their participation today in this hearing, and
the hearing is now adjourned.
Mr. Haggstrom. Thank you, Mr. Chairman.
[Whereupon, at 12:05 p.m., the Subcommittee was adjourned.]
A P P E N D I X
----------
Prepared Statement of Hon. Bill Johnson, Chairman,
Subcommittee on Oversight and Investigations
Good morning. This hearing will come to order.
I want to welcome everyone to today's hearing on ``Inspect What You
Expect: Construction Contracting Practices at VA.''
I would also like to apologize in advance that I may have to leave
early for a mark-up at the Natural Resources Committee taking place
this morning. I know that some other Members of this Subcommittee may
also be affected by the mark-up, and we will get through the hearing as
best we can or recess if necessary.
In a department the size of VA, the contracting process involves
billions of dollars annually. These funds are necessary to ensure those
who so bravely served this country are provided the care and benefits
they have earned.
However, problems arise when the contracting process is mismanaged,
and poorly executed contracting on the scale of billions of dollars--
such as what we see at VA--can mean billions of dollars wasted,
taxpayer dollars that were supposed to help the veteran.
A contracting process done correctly can actually help an
organization save money in the long run. Good contracting on a
construction project entails having an independent cost analysis of all
available options, eliminating preferential treatment, and executing a
timely process that results in a product delivered in a timely fashion
at the correct cost.
VA has acknowledged it could improve the quality of its contracting
process through use of the Electronic Contract Management System, or
``eCMS.'' In June of 2007, an Information Letter was issued by VA's
Executive Director of the Office of Acquisition and Logistics mandating
the use of eCMS. This database would record and track procurement
actions of over $25,000, and the data could then be easily and
comprehensively reviewed to determine the effectiveness of VA's
contracting processes and make changes where necessary. Cost overruns
could be identified and addressed early on, and perhaps even prevented
in the first place.
This sensible approach to overseeing the contracting process could
prevent wasted funding, potential fraud, and reduce overall contract
mismanagement. For some reason, despite its mandated usage, many
supervisors and managers across VA chose to ignore eCMS, instead
allowing the contracting system and runaway associated costs to
continue as before.
VA's Office of Inspector General found clear cases of missing and
incomplete information, and in one test discovered that 83 percent of
the transactions that should have gone into eCMS were left out.
Examples such as this dilute the value of eCMS as an accountability
measure, and in the end veterans and taxpayers bear the loss. While VA
acknowledged the OIG's findings and concurred with recommendations for
improvement, it is my wish to see concrete evidence of that
improvement.
Reports of other clear cases of contract mismanagement are equally
disturbing, including bundling contracts as well as splitting
contracts, as substantiated by the Deputy Assistant Secretary for
Acquisition and Logistics nearly a year ago.
As these contracts are mishandled, needed construction is slowed
considerably and the needed services that a new medical facility would
provide are further delayed. Again, those who are hurt most by this are
the veterans.
If we are to get this right, there must be decisive leadership in
contracting and accountability for actions at all levels. If eCMS was
mandated by VA's leadership to be used, why then is it obviously not
being used? If contracts on a construction project are intended for
veteran-owned small businesses, why would a large business be competing
for them? If plans are put in place for an expanded outpatient clinic,
why then would the size and scope of that project change, not once, but
twice?
It is past time for these billions of construction contracting
dollars to be used effectively, efficiently, and in a timely fashion so
the veterans who need the services provided by these facilities can
access them.
I appreciate everyone's attendance at this hearing and I now yield
the Ranking Member for an opening statement.
Prepared Statement of Hon. Joe Donnelly, Ranking Democratic
Member, Subcommittee on Oversight and Investigations
I would like to welcome everyone today, as we have the opportunity
to conduct the Subcommittee on Oversight and Investigations (O&I) first
hearing of the 112th Congress. I am honored to serve as the Ranking
Member and look forward to working with Chairman Johnson and other
Members on both sides of the aisle. Prior to today's hearing we had the
opportunity to meet and discuss the O&I agenda for the upcoming year
and from our discussions I know we have a full agenda, and one we are
both committed to working in a bipartisan manner as we seek to provide
the oversight our Nation's veterans rightly deserve.
Today's hearing is an example of our bipartisan work. The VA
procurement efforts and initiatives have been problematic and
controversial at times. It is important that we make certain the VA is
doing their due diligence prior to awarding a contract. There are many
steps the VA must take in between initiating procurement project
proposals and post-awards. Today, we hope the VA will assure us that
construction projects are fully reviewed to ensure successful delivery
and management.
It seems to me that there have been too many VA Office of Inspector
General reports indicating VA's lack of contract details. Furthermore,
unrealistic and unreasonable acquisition plans have led to escalated
contract costs and unmet contractor milestones. One of my concerns is,
how many times does my staff need to meet with the VA only to find out
that after millions of dollars have been spent on a contract the
contractor walks away with these funds after the VA cancels their
contracts due to unmet deliverables. This is an indication of poorly
reviewed and administered contracts.
Furthermore, since the 110th Congress the Committee has been
providing oversight on contract bundling. I am familiar with these
issues, having been a Member of the Committee on Veterans Affairs since
the 110th Congress and participated in various hearings on this topic.
Contract bundling by Contracting Officers should be reviewed carefully
as well. Whether it may be awarding contracts or set-aside initiatives
for veteran owned small businesses, bundled contracts create
opportunities for fraud and mismanagement. I will be particularly
interested in the implementation of the VA's Electronic Contract
Management System (eCMS).
Prepared Statement of Hon. John Barrow
Thank you Chairman Johnson and Ranking Member Donnelly for holding
this hearing. In order to fulfill our promises to veterans we need a
productive and efficient Community Based Outreach Clinic construction
planning process at VA.
In order to build the infrastructure our veterans need for the
health care and services we promised them VA needs to fix their broken
construction process. Fixing the contract practices at VA is a good
place to begin fixing the construction process. If done correctly, this
will increase transparency and get VA's construction process on the
right track. Increasing transparency is particularly important to me
and veterans in my district.
For 2 years my office and my constituents have sought information
regarding the status of construction for a CBOC to be built in
Statesboro. The Statesboro area already has a large population of
underserved veterans that VA predicts will increase by 5 percent in
each of the next 3 years. Currently, this growing population of
Veterans is forced to drive over an hour, either to Dublin or Savannah,
to receive the primary care and mental health treatment they need.
Over this 2 year period my office and veterans from Statesboro have
contacted the VISN in Atlanta and the Department of Veterans Affairs in
DC. But we have only received conflicting and incomplete information
from VA about where this project is in the approval process.
I thank the panelists for coming to testify before this Committee
today. Hopefully, by examining the business practices of VA we can
learn about specific deficiencies in VA's construction planning system.
I want to identify pragmatic solutions to make the VA construction
planning process more efficient and transparent, so that clear cut
cases like the Statesboro CBOC can gain swift approval and serve our
Veterans faster.
Prepared Statement of Belinda J. Finn, Assistant Inspector
General for Audits and Evaluations, Office of Inspector General,
U.S. Department of Veterans Affairs
EXECUTIVE SUMMARY
Procurement continues to be one of VA's major management
challenges. Since 2003, the Office of Inspector General (OIG) has
reported that VA still has much work to do to leverage its purchasing
power for acquiring goods and services. We have consistently reported
on the need for increased management visibility and transparency to
manage acquisitions nationwide, make good procurement decisions, and to
address the reliability and completeness of the information VA relies
upon to make acquisition decisions.
VA has mandated the use of the Electronic Contract Management
System (eCMS). The eCMS system can reduce costs, integrate and
standardize procurement processes, reduce workload, and improve
communications. Additionally, the system provides the functionality to
create management reports and improve the capability of consolidating
requirements to support strategic sourcing and acquisition decisions.
Unfortunately, we continue to see low levels of compliance associated
with VA Contracting staff using this system and when the system is
used, the information in the system is incomplete. VA cannot rely on
the information in eCMS to determine the total number of procurements
accurately or the total estimated value of these procurements when
information in the system is incomplete. Reports generated through eCMS
are incomplete and cannot be relied upon when making management
decisions. Until VA enforces compliance for the mandatory use of eCMS,
VA cannot benefit from the full capabilities of the system.
Ongoing audit work at the VA's National Acquisition Center (NAC),
VA's largest contracting activity and a major organizational component
reporting directly to the Office of Acquisition, Logistics, and
Construction (OALC) continues to identify problems in the use of eCMS
to develop and maintain national contracts. Without senior leadership's
attention focused on ensuring eCMS usage and capturing VA procurement
information in a reliable central database, VA will not achieve the
improvement needed in acquisition service delivery from an enterprise-
wide perspective.
A follow-up audit on VA's construction program found that VA had
established a Quality Assurance (QA) program and procedures to resolve
previously reported problems. We reported that the QA program needed
written policies, procedures, performance measures, and a staffing plan
to ensure it met its responsibilities. Additionally, the QA program
could not oversee contract schedule slippage because it was focused on
performing field acquisition reviews. The OALC Executive Director
agreed with our findings and planned to implement corrective actions.
Other OIG components have performed work related to VA construction
contracts including our Office of Contract Review which recently began
conducting pre-award reviews of claims related to construction
contracts. Our Office of Investigations annually briefs 14,000 VA
employees on fraud indicators, and has assigned a criminal investigator
liaison to each VA facility with construction contracts valued at $10
million or more.
__________
Mr. Chairman and Members of the Subcommittee, thank you for this
opportunity to testify on the findings of the Office of Inspector
General (OIG) related to the Department of Veterans Affairs (VA)
procurement processes. I am accompanied today by Cherie Palmer,
Director, Chicago Office of Audits and Evaluations.
Background
Procurement continues to be one of VA's major management
challenges. Our oversight of VA's procurement activities including
information systems and the Construction Program is performed through
audits and reviews. Since 2003, we have reported that VA still has much
work to do to leverage its purchasing power acquiring goods and
services. We have consistently reported on the need for increased
management visibility and transparency to manage acquisitions
nationwide, make good procurement decisions, and to address the
reliability and completeness of the information VA relies upon to make
acquisition decisions.
VA has one of the largest procurement programs in the Federal
Government with annual expenditures of more than $10.3 billion for
supplies and services, including construction. Drugs, medical supplies
and equipment, automated data processing equipment and services, and
other critical patient care items must be procured and distributed to
VA's health care facilities that comprise the largest health care
delivery system in the country. The Office of Acquisition and Logistics
(OAL) is responsible to the VA Secretary for providing goods and
services to support the mission of VA through the Executive Director,
Office of Acquisition, Logistics, and Construction (OALC).
The OALC Executive Director implemented VA's Electronic Contract
Management System (eCMS) as the single mechanism for generating and
managing procurement actions. OALC issued Information Letter 049-07-06,
dated June 15, 2007, implementing and mandating the use of eCMS. The
eCMS provides a centralized database for procurement actions and
replaces a primarily manual and paper-based contract management
operation used throughout VA. Using a web-based platform, it was
designed to provide a fully integrated electronic acquisition platform
that includes the seamless flow of information and data from all
stakeholders and systems from initial requisitioning through closeout.
The benefits of the system included the ability to reduce costs,
integrate and standardize procurement processes, reduce workload, and
improve communications. Additionally, the system provides the
functionality to create management reports and improve the capability
of consolidating requirements to support strategic sourcing and
acquisition decisions. Unfortunately, we continue to see low levels of
compliance associated with contracting staff using this mandated system
and when the system is used, the information in the system is often
incomplete.
OIG Audit Results on eCMS
In July 2009, we issued Audit of VA Electronic Contract Management
System (Report Number 08-00921-181, published July 30, 2009).
Specifically, we examined whether information in eCMS enables VA to use
the system as a comprehensive management tool to improve its
procurement processes and information. We found that eCMS was not used
effectively and procurement information in eCMS was incomplete.
Management did not ensure the required use of eCMS and there was no
oversight program to monitor staff compliance with Information Letter
(IL) 049-07-06. We reported that VA cannot achieve the expected benefit
of eCMS, including the ability to integrate and standardize procurement
processes, reduce workload, and improve communication without complete
information. VA cannot rely on eCMS to determine the total number of
procurements accurately or the total estimated value of these
procurements when information in the system is incomplete.
During our audit, we compared just over 6,700 procurement actions
valued at about $1.7 billion in VA's Integrated Funds Distribution,
Control Point Activity, Accounting and Procurement (IFCAP) system to
information in eCMS. We found that just over 1,150 (17 percent) of the
procurement actions (valued at about $319 million) were recorded in
eCMS, while the remaining, nearly 5,600 (83 percent) of actions (valued
at about $1.4 billion) were not.
We also compared 1,450 awarded procurement actions from the General
Services Administration Federal Procurement Data System-Next Generation
(FPDS-NG) and found just over 700 (49 percent), valued at about $1.4
billion, were recorded in eCMS and nearly 300 (21 percent) of 1,450
procurement actions, valued at about $91 million, were only partially
completed in eCMS. Information on nearly 450 (30 percent) of 1,450
procurement actions (valued at about $234.7 million) were not recorded
in eCMS. Therefore, we concluded that the reports generated by eCMS
were unreliable and could not be used when making management decisions.
To better understand why VA contracting staff were not effectively
leveraging the use of eCMS, we conducted a survey of eCMS users.
Responses to our survey indicated staff needed additional training to
fully understand and comprehensively use the capability of eCMS.
Twenty-two percent of the respondents considered the quality of
training provided inadequate. Also, management and staff told us the
system is cumbersome and takes too much time to process procurement
actions.
We also found the Information Letter provided unclear guidance
pertaining to the types of procurements that are required to be
recorded in eCMS and does not ensure consistency and compliance across
all VA business lines that could potentially be misinterpreted.
Finally, we reported that award data for contracts in eCMS does not
electronically transfer to IFCAP resulting in a duplication of input
effort for procurement staff. We recommended integrating eCMS with
IFCAP to provide VA with improved acquisition efficiency and reporting.
In total, we made eight recommendations of which three remain
unimplemented (or ``open'') today; these open recommendations include
implementing a VA-wide eCMS policy; establishing a plan to evaluate the
technical performance of eCMS; and integrating eCMS with IFCAP.
In subsequent audit work and as VA focused on deploying funds for
the American Recovery and Reinvestment Act of 2009 (ARRA), we focused
on how well VA monitored the process for awarding ARRA non-recurring
maintenance contract awards. To accomplish this work, auditors
attempted to review related procurement information in eCMS. On
February 18, 2009, OMB issued Memorandum M-09-10, the initial
Government-wide guidance for Recovery Act programs and activities. On
March 17, 2009, OALC issued IL001AL-09-07, ``Implementing Guidance for
Contracting Awards under American Recovery and Reinvestment Act of
2009'', which states that ``without exception all Recovery Act
contracts regardless of dollar value, must be generated in eCMS''.
On March 15, 2010, we published the American Recovery and
Reinvestment Act Oversight Advisory Report--Non-Recurring Maintenance
Contract Award Monitoring Processes (Report Number 09-01814-97). We
found eCMS data reliability and system problems were continuing to
inhibit OALC's ability to effectively monitor Recovery Act procurements
and to ensure non-recurring maintenance contract awards met Recovery
Act requirements and accountability, efficiency, and transparency
objectives. Our audit showed that OALC needed to work with Veteran
Health Administration (VHA) contracting officers to promote uniformity
in the usage of eCMS, improve the completeness and accuracy of eCMS
data, and increase awareness of eCMS system problems that affect the
reliability of eCMS information.
During work on our national Audit of Oversight of Patient
Transportation Contracts (Report Number 09-01958-155 published, May 17,
2010), we found that VHA missed opportunities to solicit new
competitive contracts and make contract awards. While performing audit
work we experienced significant challenges in obtaining a complete
universe of contracts due to the incomplete data in eCMS. Because VA
lacked a system-wide inventory of contracts, we developed a technique
to use the FPDS-NG system information to identify patient
transportation contracts by using the product service code. We reported
that Veterans Integrated Service Network contract managers did not
provide the oversight to ensure that new solicitations were timely to
avoid granting extensions in order to prevent a lapse of service.
Further, contracts were extended that circumvented the Federal
Acquisition Regulation (FAR) instead of ensuring full and open
competition. These conditions clearly inhibit VA from obtaining the
best price and or value for the goods and services being acquired.
According to the Director of VA's eCMS Project, the milestone function
capabilities in eCMS should be used to monitor and plan for contracts
that are due to expire. Utilizing this function will help ensure timely
follow-up on procurement actions. VA officials recognized that it is
important to establish milestones within eCMS to provide increased
management visibility and oversight, but information supporting some
contracting actions was missing.
In a review of the National Cemetery Administration (NCA) we
assessed how well NCA implemented effective policies and procedures to
ensure accountability and transparency for $50 million in ARRA funds.
We published Review of the Management of Recovery Act Funds for
Monument and Memorial Repairs (Report Number 09-01814-263), on
September 30, 2010. We again found and reported that NCA did not ensure
complete procurement information on ARRA-funded projects was recorded
in eCMS.
Our results showed non-compliance with the requirement that all
contracts, regardless of dollar value, must be recorded in eCMS. As a
result, we concluded VA lacks effective management and oversight
controls needed to monitor national contract awards. For this project,
we reviewed 36 of the 56 ARRA projects (obligated as of July 10, 2009)
and identified 34 equipment and national shrine repair projects valued
at $2.5 million that did not have the required procurement information,
such as acquisition plans, contracts, purchases orders, price quotes,
and price analysis recorded in eCMS.
We are currently conducting an audit at VA's National Acquisition
Center (NAC)--VA's largest contracting activity and a major
organizational component reporting directly to OALC. Again, we have
concerns that eCMS is not fully utilized to develop and maintain
national contracts and related files at the NAC. Although OALC mandated
eCMS usage, it did not adequately ensure the required use of eCMS by
providing the oversight needed to monitor eCMS compliance at the NAC.
We are reviewing 30 national contracts with a total estimated value of
$2.4 billion. Our preliminary results show that contract information
was not in eCMS for a number of contracts. These contracts included
acquisitions for high cost technical medical equipment, such as
magnetic resonance imaging, radiation therapy, diagnostic ultrasound,
and nuclear imaging. Further, while our preliminary review of hard copy
contract files shows that contract development and award actions were
generally in accordance with Federal and VA Acquisition Regulations,
but documentation was missing in eCMS. For example, eCMS information
did not include the solicitations, price negotiation memorandums, and
awarded signed contracts for all national contracts.
We also learned that the NAC utilizes its own Contract Management
(CM) system and requires NAC contracting officers to enter and maintain
data into this system in addition to eCMS. This is because the other
Government agencies that purchase from the NAC's national contracts
cannot access the contract information available in eCMS. The CM system
also provides an Internet electronic catalog function that allows non-
VA customers to access NAC contract data. According to the NAC
Executive Director, neither the CM system nor eCMS offers a complete
acquisition solution; therefore, both systems are needed.
Reports generated from eCMS, such as the Procurement Action Lead
Time, cannot be relied upon when making procurement decisions because
the information in eCMS is either missing or incomplete. In addition,
reliance upon two incompatible systems creates a duplication of effort
resulting in an inefficient use of time and resources. OALC is
developing an upgrade to eCMS that includes integrating the functions
available in the CM system into eCMS and making the eCMS contract data
available to its non-VA customers. The upgrade has been delayed from
its initial September 2010 completion date until August 2011. OALC
provided limited oversight to monitor eCMS compliance and ensure eCMS
system capabilities adequately support NAC operations. Without senior
leadership's attention focused on ensuring eCMS usage and capturing VA
procurement information in a reliable central database, VA will not
achieve the improvement needed in acquisition service from an
enterprise-wide perspective.
We have reported significant lapses in VA contracting staff
leveraging the use of eCMS since 2009. VA's own internal auditors have
also reported on how information is incomplete in the eCMS system. For
example, the Acquisition Assessment of the NAC published July 20, 2010,
performed by contractors supporting VA's Office of Business Oversight
in accordance with the Office of Management and Budget's Circular A-
123, found that NAC staff were not consistently using eCMS to document
contract actions as required. The NAC cannot achieve the expected
benefits of eCMS without complete documents and files related to each
procurement action being entered into the system.
In spite of numerous OIG reports citing deficiencies in the use of
eCMS, VA still needs to improve compliance and use of this mandatory
system to better leverage VA's buying power. Since our reviews, VA has
moved forward with the testing for integration of eCMS and IFCAP to
ensure that technical performance of eCMS improves. VA has acknowledged
that it cannot fully realize the benefits of eCMS without ensuring that
the tool performs to technical specifications, that staff receive the
necessary training, and that eCMS properly integrates with existing and
planned financial systems. However, in spite of this acknowledgement,
several of our recommendations remain unimplemented and we continue to
find a lack of compliance, accountability, and transparency with eCMS
in our audit work.
OIG Audits on VA's Construction Program
In FY 2009, we performed a follow-up audit to determine whether VA
implemented the corrective action plans in response to recommendations
made in our Audit of Veterans Health Administration Major Construction
Contract Award and Administration Process (Report Number 02-02181-79,
February 8, 2005). Our 2005 report included 12 recommendations that
addressed needed improvements in contract award, administration, and
project management. At that time, the Under Secretary for Health
concurred with the 2005 report recommendations and provided corrective
action plans.
We reported that VA had strengthened management control and
oversight of the major construction contracting process with the
implementation of 10 of the 12 recommendations from the OIG's 2005
report. Specifically, we found that VA had addressed 10 of the 12
recommendations through the establishment of a Quality Assurance (QA)
program and procedures to resolve significant differences between bid
prices and Architecture and Engineering (A/E) estimates.
VA established the QA Service to oversee VA's major construction
contracts and ensure the contracts complied with Federal and VA
acquisition regulations and VA policies and procedures. However, we
reported that VA had no assurance that the QA Service is effectively
monitoring major construction contracts because it had no written
policies, procedures, and performance measures. Further, the QA Service
did not have a staffing plan to ensure it met all of its QA program
responsibilities.\1\
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\1\ At the time OIG issued its 2005 report, VHA's Office of
Facilities Management (FM) was responsible for managing all major
construction projects. In February 2007, FM was reorganized and
realigned to the Office of the Secretary as the new Office of
Construction and Facilities Management (CFM) under the direction of the
Deputy Secretary. In October 2008, VA established the Office of
Acquisition, Logistics, and Construction (OALC), which now includes
CFM. The new office is headed by the Executive Director reporting to
the Deputy Secretary.
---------------------------------------------------------------------------
VA did not however, fully implement the 2005 report recommendations
to implement more effective project management oversight to manage and
reduce contract schedule slippage from a national perspective. In
response to the 2005 report recommendation, VHA advised that the new QA
Service oversight function would review the existing process for
assessing contract slippage and the method by which feedback is
provided to the field. However, we found that QA had not performed
these assessments or provided oversight of contract schedule slippage
because its efforts were focused on performing field acquisition
reviews of construction contracts. This lack of oversight could result
in significant contract slippage and increased construction costs. In
addition, VA did not fully implement the 2005 report recommendation to
establish an effective program to ensure the timely close out of major
construction contracts and identify unused funds that could be returned
to the construction reserve account.
In our follow-up report, we offered recommendations to the
Executive Director for OALC to implement an effective mechanism to
monitor contract schedule slippage and minimize construction contract
delays and to establish an effective mechanism to ensure the timely
close out of major construction contracts. We also recommended the
Executive Director develop written QA policies and procedures, program
performance measures addressing all QA Service areas of
responsibilities, and a formal staffing plan to ensure all QA Service
responsibilities are met. The Executive Director for OALC agreed with
our findings and recommendations and provided plans to implement
acceptable corrective actions. We will continue to assess the
effectiveness of VA's construction program in future work.
Other OIG Work Related to VA Construction Contracts
Office of Contract Review--In FY 2011, our Office of Contract
Review began conducting pre-award reviews of claims related to
construction contracts. We do not yet have sufficient data upon which
to base an opinion on the significance of performance issues impacting
VA construction activities from a national perspective. Once we have
completed a sufficient number of reviews, we will offer the
Subcommittee a briefing on our findings and conclusions.
Crime Awareness Briefings--In order to help deter crime, OIG
criminal investigators provide approximately 200 crime awareness
briefings each fiscal year to about 14,000 employees at VA facilities
nationwide. These briefings are intended to ensure the attendees are
aware of the many types of fraud and criminal activity that can
victimize VA, VA employees, and veterans. These briefings have resulted
in additional referrals of alleged criminal activity and have enhanced
our partnership with VA Police in helping provide a safe and secure
environment for veteran patients and employees.
Criminal Investigator Liaisons--Criminal investigators are assigned
to VA facilities with contracts having a value of $10 million or more,
to serve in a liaison capacity sharing information with contracting
officers, contracting officer's technical representatives, program
managers, and prime and sub-contractor staff to deter, detect, and
investigate potential construction fraud.
VA Acquisition Academy--In concert with the Department of Justice
Antitrust Division, the Counselor to the Inspector General and OIG
investigators provide instruction to VA contracting officers and
interns at the VA Acquisition Academy in Frederick, MD. The training
covers the OIG's role, criminal conduct relating to procurement, audit
issues relating to procurement, and how to avoid or prevail in
disputes.
Procurement Fraud Task Forces--The OIG regularly participates in
regional and national procurement fraud meetings and conferences to
learn of effective programs and strategies to address procurement fraud
Government-wide. In anticipation of fraud in connection with Recovery
Act projects, we arranged for the Department of Justice's Antitrust
Division to provide to VA's Deputy Assistant Secretary for Acquisition
and Materiel Management and his staff.
Conclusion
While VA has recognized deficiencies in its acquisition processes
and infrastructure, they have yet to exercise sufficient organizational
discipline to ensure that its primary management oversight tool
provides the needed transparency to manage a multi-billion dollar
acquisition program. We believe VA should continue its efforts to
leverage the full capacity of eCMS and integrate it into existing and
future financial systems.
Mr. Chairman, this concludes my statement. We would be pleased to
answer any questions that you or other Members of the Subcommittee may
have on these issues.
Prepared Statement of Glenn D. Haggstrom, Executive Director,
Office of Acquisition, Logistics, and Construction, U.S. Department
of Veterans Affairs
Chairman Johnson, Ranking Member Donnelly, and distinguished
Members of the Committee, thank you for the opportunity to appear
before you today to discuss the Department of Veterans Affairs (VA)
acquisition, logistics, and facilities management, operations. It is a
privilege for me to represent the many dedicated and hard-working
professionals who provide mission-critical support everyday to ensure
necessary contracts, logistics support, and facilities are available
for some of our Nation's most extraordinary citizens, Veterans. I am
accompanied here today by Mr. Jan Frye, VA's Deputy Assistant Secretary
for Acquisition and Logistics (OAL) and the Department's Senior
Procurement Executive, Mr. Robert Neary, Acting Director for
Construction and Facilities Management (CFM) and Mr. Jim Sullivan,
Director Office of Asset Enterprise Management.
The Office of Acquisition, Logistics and Construction (OALC) was
formed in October of 2008 to support the acquisition, logistics, and
construction needs of the Department of Veterans Affairs (VA). These
organizations were brought together to provide an enterprise approach
to policy, process, and systems necessary to support these similar
functions resident in each of the VA administrations. The core
responsibilities and an integrated acquisition model were affirmed by
the Secretary on April 2010. Together, these structural and process
changes will enable the Department to serve our internal customers'
needs and ultimately our Veterans in a more efficient manner.
OALC has six fundamental roles in the operation of the Department:
achieve clear ownership and accountability of the VA contracting
mission; gain control over acquisition and facilities management
information; effectively manage the acquisition life cycle for
contracting and construction; develop critical human capital resources;
enhance information management to support corporate decision-making;
and finally, improve service delivery.
With the focus of today's hearing on VA's electronic contract
management system and the major construction program, I'd like to
inform the Committee on where we stand with regard to completing the
recommendations identified by the OIG in each of the reports.
Currently, OALC has two VAOIG reports with 4 recommendations that
remain open.
As part of OALC's continuous improvement process, the findings and
recommendations of all OIG and GAO reports are captured, analyzed,
tracked, and acted upon.
First, the ``Audit of VA Electronic Contract Management (eCMS),''
published in July of 2009 identified eight recommendations, five of
which the OIG has closed. Significant progress has been made through
management actions to complete system user training with training teams
available to the administrations upon their request, putting in place
oversight programs at the administration and headquarters level to
review eCMS usage, and the ability to perform real property leasing
actions within the system is in use. Three recommendations remain open.
The recommendation to develop and implement a VA-wide eCMS policy
and handbook to ensure consistent use and compliance with the system
requirements is nearing completion. We completed developing and
providing an integrated, role-based matrix for using the individual
eCMS User Guides in the December 2010 release of the system. The
remaining action to complete policy revision will be completed by the
end of this month. The second open recommendation deals with the
technical performance of the system. In response to this we completed
phase one of our technical refresh in January 2010 with phase two
scheduled to be completed in June of this year. The refresh includes
server replacement, software changes to increase performance, and
expanded data repository capacities. Finally, the remaining
recommendation was to determine the feasibility of integrating eCMS
with the Integrated Funds Control Point Activity, Accounting and
Procurement System to streamline the procurement process. The
integration software has been completed and tested and is scheduled for
production roll out the first quarter of fiscal year 2012.
The ``Audit of VA's Major Construction Contract Award and
Administration Process,'' identified four recommendations with one
still remaining open. Successfully closed were recommendations to
establish effective mechanisms to monitor contract slippage and ensure
the timely close out of major construction projects, and develop a
staffing plan to ensure quality assurance responsibilities are met. In
the remaining open recommendation OALC is developing written quality
assurance policies and procedures, and program performance measures
addressing all QA Service areas of responsibilities. Phase one of this
recommendation was completed in December of 2010 and phase II will be
completed in June of this year at which time we will recommend to the
IG that the report be closed.
Also, in 2009 the Government Accountability Office issued a report
on VA major construction noting that VA generally met GAO best
practices for a Federal major construction program in 10 of 12 areas.
From that report came two recommendations that VA fully supported and
is in the process of implementing, first the use of an integrated
master schedule and second conducting a risk analysis based on the
project's cost, schedule, and complexity. Both of these recommendations
will be completed this fiscal year at which time VA will have
implemented all 12 of GAO's best practices.
As proud as we are of the many improvements in VA's acquisition and
facilities management operations, we recognize the need for continuous
improvement and will work diligently to maintain the confidence of the
American public and the Congress.
Mr. Chairman, we appreciate the opportunity to discuss VA's
acquisition, logistics, and construction operations with you. My
colleagues and I are available for your questions.
MATERIAL SUBMITTED FOR THE RECORD
U.S. Department of Veterans
Memorandum
Date: April 28, 2011
From: Executive Director, Office of Acquisition, Logistics, and
Construction (001ALC)
Subj: Due Outs from April 12 Testimony (VAIQ 7085980)
To: Director for Congressional Affairs (009)
1. In response to a request for deliverables from the April 12,
2011, testimony to the House Committee on Veterans Affairs Subcommittee
on Oversight and Investigations hearing entitled, ``Inspect What You
Expect: Construction Contracting Practices at the Department of
Veterans Affairs,'' the Office of Acquisition, Logistics, and
Construction provides the following information.
a. Deliverable: Regarding the electronic Contract Management System
(eCMS), please provide Help Desk records that show the numbers of help
tickets called in and resolved as far back as possible. Categorize them
as designated in the Enterprise Acquisition System (EAS), e.g.,
password resets, the various level of calls, and response times.
Response: The EAS analyzes eCMS Service Desk tickets and generates
itemized and summarized reports through the Veterans Affairs
Acquisition Help Desk tool set. The reports include a high-level data
summary entitle eCMS Service Desk Tickets Summary Report and a
detailed, record-level report eCMS Service Desk Tickets Detailed Report
(see attachment 1). For clarity, a Sub-Category Definitions is also
provided at attachment 1. [The detailed report will be retained in the
Committee files.]
Each record in the detailed report includes the following
attributes: ticket number; date submitted; title; category; sub-
category; priority; ; and status. The report can be filtered by
attributes for a more detailed analysis.
b. Deliverable: Please provide a list of training course materials
VA uses for eCMS training.
Response: The compact disc (CD) provided by the EAS Service
includes eCMS classroom training materials, online tutorials, and user
guides typically delivered during the EAS Service scheduled training
sessions and through VA's Acquisition Resource Center online access. A
copy of the CD and the list of the data contained on the CD are at
attachment 2. [The CD is being retained in the Committee files.]
c. Deliverable: Please provide the year of implementation of the
Paragon System and the initial cost. Provide the documented annual cost
of the system starting in fiscal year 2005.
Response: The Office of Construction and Facilities Management
first began using the Paragon System in 1998 at the cost of $290,000.
The annual costs, commencing in fiscal year (FY) 2005, are as follows:
FY 2005-$385,000
FY 2006-$308,000
FY 2007-$478,000 (50 additional licenses)
FY 2008-$308,000
FY 2009-$500,500
FY 2010-$855.000 (250 more licenses and enterprise version, Web
hosting)
FY 2011-$600,000
Attachments(2)
Glenn D. Haggstrom
Attachment 1
eCMS Servicer Desk Ticket Summary Report
(Cumulative through 4/19/2011
------------------------------------------------------------------------
Total
Category Sub-Category Tickets
------------------------------------------------------------------------
ARC Announcement 3
Request
----------------------------------
Community Request 44
----------------------------------
Content Request 50
----------------------------------
Online Registration 29
----------------------------------
Performance 19
----------------------------------
Technical Support 54
------------------------------------------------------------------------
Contract Action Maintenance 1653
Module...............................
----------------------------------
Delete Action 490
----------------------------------
Document Management 372
----------------------------------
Enhancement Request 76
----------------------------------
IAE 464
----------------------------------
Performance 152
----------------------------------
System Errors 314
----------------------------------
User Maintenance 1111
------------------------------------------------------------------------
Contracting Module Award Action 140
----------------------------------
Funding Actions 4
----------------------------------
Other Desktops 8
----------------------------------
Planning Actions 15
----------------------------------
Post Award-- 1
Contract Mods
----------------------------------
Post Award-- 4
Delivery/Task
Orders
----------------------------------
Post Award--Order 1
Mods
----------------------------------
Procurement Actions 117
----------------------------------
System Errors 18
----------------------------------
User Maintenance 102
----------------------------------
Views 4
------------------------------------------------------------------------
eCMS Homepage Other 36
----------------------------------
User Maintenance 4
----------------------------------
Views 3
------------------------------------------------------------------------
Epic Document Server 4
----------------------------------
IFCAP Retrieval 245
----------------------------------
Performance 3
----------------------------------
Planning Module 45
----------------------------------
Solicitation 11
Evaluation
----------------------------------
User Maintenance 45
------------------------------------------------------------------------
FAC CLP Tracker 141
----------------------------------
FAC C 911
----------------------------------
FAC COTR 5
----------------------------------
FAC PPM 102
----------------------------------
PAWS 1
----------------------------------
Performance 3
------------------------------------------------------------------------
IAE CCR 8
----------------------------------
eBuy 57
----------------------------------
FBO 247
----------------------------------
FPDS 679
----------------------------------
IFCAP 5
----------------------------------
Orca 1
------------------------------------------------------------------------
IFCAP Configure IFCAP 9
Retrieval............................ Instances(s)
----------------------------------
IFCAP Retrieval 39
Status
----------------------------------
Retrieve IFCAP 15
Requisition Data
------------------------------------------------------------------------
MicroStrategy Reporting Tool Dashboard 8
----------------------------------
Performance 18
----------------------------------
Report Request 61
----------------------------------
System Errors 7
----------------------------------
User Account 63
------------------------------------------------------------------------
Planning Report Request 3
Module...............................
------------------------------------------------------------------------
Policy Other 14
------------------------------------------------------------------------
Solicitation Evaluation Evaluation 3
------------------------------------------------------------------------
Training Accounts 30
Environment..........................
----------------------------------
Certificates 2
----------------------------------
Other 47
------------------------------------------------------------------------
Vendor Portal Performance 7
----------------------------------
Solicitations 42
----------------------------------
User Management 368
------------------------------------------------------------------------
(no data) (no data) 1
------------------------------------------------------------------------
Cumulative Ticket 8538
Total
------------------------------------------------------------------------
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
eCMS Service Desk Tickets by Category
(Cumulative through 04/10/2011)
------------------------------------------------------------------------
Category Total Tickets
------------------------------------------------------------------------
ARC 199
------------------------------------------------------------------------
Contract Module 4632
------------------------------------------------------------------------
Contracting Module--OBE 414
------------------------------------------------------------------------
eCMS Homepage 43
------------------------------------------------------------------------
Epic 353
------------------------------------------------------------------------
FAC 1163
------------------------------------------------------------------------
IAE 997
------------------------------------------------------------------------
IFCAP Rtrvl 63
------------------------------------------------------------------------
Micro Strat 157
------------------------------------------------------------------------
Planning Module 3
------------------------------------------------------------------------
Policy 14
------------------------------------------------------------------------
Solicitation Eval. 3
------------------------------------------------------------------------
Training Environment 79
------------------------------------------------------------------------
Vendor Portal 417
------------------------------------------------------------------------
No Data 1
------------------------------------------------------------------------
Cumulative Ticket Total 8538
------------------------------------------------------------------------
Attachment 2
VA eCMS Classroom Training Material:
2-Day Training
1. ARC-eCMS Refresher Training Agenda
2. ARC-eCMS Refresher Training Presentation
4-Day Training
1. ARC-eCMS Certification Training for Contracting Agenda
2. ARC-eCMS Certification Training for Contracting Exercises
3. ARC-eCMS Certification Training for Contracting Presentation
4. VA eCMS Classroom Training Exercises (CAATS)
Reviewer Role-Based Training
1. ARC-eCMS Reviewer Training Agenda
2. ARC-eCMS Reviewer Training Exercises
3. ARC-eCMS Reviewer Training Presentation
Supervisor Role-Based Training
1. ARC-eCMS Supervisor Training Agenda
2. ARC-eCMS Supervisor Training Presentation
3. ARC-eCMS Supervisor Training Exercises
Training for Procurement and Purchasing
1. ARC-eCMS Certification Training for Purchasing Agenda
2. ARC-eCMS Certification Training for Purchasing Exercises
3. ARC-eCMS Certification Training for Purchasing Presentation
VA eCMS Online Tutorials:
1. Action Lookup Online Tutorial
2. Construction Contracts Online Tutorial
3. Create Action from an Existing Action Online Tutorial
4. Document Generation Online Tutorial
5. e-Buy Online Tutorial Part 1
6. e-Buy Online Tutorial Part 2
7. Enterprise System Administration Online Tutorial
8. FBO Announcing Online Tutorial
9. FPDS Reporting Online Tutorial
10. Order Creation Online Tutorial
11. Overview of the Briefcase Tab Online Tutorial
12. Overview of the Summary Tab Online Tutorial
13. Overview of the Data Values Tab Online Tutorial
14. Overview of the Documents Tab Online Tutorial
15. Overview of the Milestones Tab Online Tutorial
16. Vendor Portal Posting Online Tutorial
17. Views Online Tutorial
18. ReadMe File Instructions
VA eCMS User Guides:
1. eCMS Acquisition Planning Guide Contracting Offices
2. eCMS Acquisition Planning Guide Program Offices
3. eCMS Acquisition Review Guide
4. VA eCMS Action and Desktop Management Guide
5. eCMS CMTS User Guide
6. VA eCMS Construction Contracts Guide
7. VA eCMS Contract Creation Guide
8. VA eCMS Document Creation & Formatting Guide
9. VA eCMS Enterprise System Administration Guide
10. VA eCMS Evaluators Guide
11. VA eCMS External Vendor Guide
12. VA eCMS FBO Announcing Guide
13. VA eCMS FCO Reporting Guide
14. VA eCMS FPDS Reporting Guide
15. eCMS FSS and eBuy User Guide
16. VA eCMS IFCAP Retrieval Guide
17. VA eCMS Manager's Guide
18. VA eCMS Milestone Plans Guide
19. VA eCMS Multiple PRs and Awards Guide
20. VA eCMS Order Creation Guide
21. VA eCMS Quick Reference Guide
22. VA eCMS Recovery Act Guide
23. VA eCMS Reviewer's Guide
24. VA eCMS Solicitation Evaluation Guide
25. VA eCMS Solicitation Guide for the NAC
26. VA eCMS Solicitation Management Guide
27. VA eCMS Utilizing Views Guide
28. VA eCMS Vendor Portal Guide
29. eCMS Vendor's Guide
Committee on Veterans' Affairs
Subcommittee on Oversight and Investigations
Washington, DC.
May 10, 2011
The Honorable Eric K. Shinseki
Secretary
U.S. Department of Veterans Affairs
810 Vermont Avenue, NW
Washington, DC 20420
Dear Mr. Secretary:
In reference to the Oversight and Investigations Subcommittee
hearing entitled ``Inspect What You Expect: Construction Contracting
Practices at VA'' that took place on April 13, 2011, I would appreciate
it if you could answer the enclosed hearing questions by the close of
business on June 14, 2011.
In an effort to reduce printing costs, the Committee on Veterans'
Affairs, in cooperation with the Joint Committee on Printing, is
implementing some formatting changes for materials for all full
Committee and Subcommittee hearings. Therefore, it would be appreciated
if you could provide your answers consecutively and single-spaced. In
addition, please restate the question in its entirety before the
answer.
Due to the delay in receiving mail, please provide your response to
Diane Kirkland at [email protected]. If you have any
questions, please call 202-225-3527.
Sincerely,
Bill Johnson
Chairman
EG/dk
__________
The Honorable Bill Johnson
Oversight and Investigations Subcommittee
House Committee on Veterans Affairs
``Inspect What You Expect: Construction Contracting Practices at VA''
April 13, 2011 Hearing
Question 1: What is the total cost for the implementation of eCMS?
Response: The total development cost for Electronic Contract
Management System (eCMS) was approximately $13.4 million. The cost
includes requirements definition, software licenses, training, and
system development. The $20 million figure provided at the April 13th
hearing included an additional approximately $6.5 million attributable
to maintenance and operational support costs incurred during the
initial post-implementation years, from 2003 through 2006.
Question 2: Given the very similar capabilities between eCMS and
Paragon, are any efforts being made to consolidate the two, remove
duplicative functions, and provide a cost saving?
Response: Although, both systems contain contract documentation,
eCMS is a contract writing system established to standardize and
replace paper contract files; and Paragon is a project management
system used during post-award to manage major construction projects and
track some aspects of the administration of the construction contract
during the construction period.
VA's eCMS is a Web-based contract management system which provides
pre-award, award, and post-award functionality for all new procurement
actions valued over $3,000. It has a limited ability to transfer data
and/or documents (i.e., specifications and drawings) to FedBizOpps;
however, documents can be uploaded directly through FedBizOpps.
Paragon is a commercial off-the-shelf (COTS) package that the
Office of Acquisition, Logistics, and Construction (OALC), Office of
Construction and Facilities Management (CFM) has used for approximately
13 years to manage and administer their major construction program
within the VA, primarily, in the field. It integrates all facets of
program management (post-award) into a single unified system. It is the
software tool utilized by Resident Engineers in the field, to
administer the construction phase of the project on a daily basis.
Specifically, Paragon manages and tracks submittals, trends, meeting
minutes, daily logs, requests for information, proposal requests,
correspondence and invoicing. In addition, the Resident Engineers
generate contract modifications within their limited authority through
Paragon to correct technical deficiencies and to keep the project on
schedule and within budget as it relates to the invoices and schedules.
A dialogue began approximately 2 years ago with eCMS and Paragon
representatives outlining the desire for an electronic transfer of
contract data without duplication. As of this quarter, the data
exchange has been completed and the automated uploading is successfully
being accomplished.
Question 3: VetBizOpps is a self-certification site for businesses
and VA now verifies the accuracy of the information in that system. How
does VA ensure contracts are not awarded to businesses unqualified to
perform work?
Response: VA's Veteran-owned small business (VOSB) Verification
Program verifies a contractor's ownership (e.g., whether or not they
are a service-disabled Veteran-owned small business (SDVOSB) or a VOSB.
The verification process does not review prospective contractors for
their capability to perform any specific contract or type of contracts.
Capability is a contract-specific matter, assessed as part of the
evaluation process according to criteria specified in the solicitation.
In responding to the solicitation, offerors know what information they
must provide to document capability to the satisfaction of the source
selection team and the contracting officer. Where a contract will be
awarded through negotiation, the contracting officer may request
additional clarifying information where appropriate. Where a contract
will be awarded based on lowest price through sealed bidding,
insufficient information on capability may result in the offer being
deemed unresponsive and not considered.
The VetBiz.gov Vendor Information Pages (VIP) is a database located
on the Internet at www.vip.vetbiz.gov, where prospective VA contractors
register their information as part of their application for
verification as SDVOSB or VOSB. Veteran ownership and control is no
longer self-certified at VA, but is verified according to standards
established in title 38, Code of Federal Regulations, part 74. This
verification includes detailed reviews of documents submitted; follow-
up interviews; and where appropriate, a site visit. Additionally,
effective October 1, 2010, all contractors must be verified prior to
receiving a VA contract award through the Veterans First Contracting
Program. The authorities under Public Law (P.L.) 109-461, the Veterans
Benefits, Health Care, and Information Technology Act of 2006, were
implemented by VA as the Veterans First Contracting Program, effective
June 20, 2007.
Question 4: North American Industry Classification System (NAICS)
is the standard used by Federal statistical agencies in classifying
business establishments for the purpose of collecting, analyzing, and
publishing statistical data related to the U.S. business economy. Do
companies without the proper NAICS certifications ever receive a
contract for work that they are unqualified to perform? If so, why?
Response: As the question notes, NAICS codes are industry
classifications primarily for statistical purposes and to determine the
business size (large or small) for the industry in question. They are
not certifications of capability to perform any particular contract or
class of contract. Capability is assessed according to criteria
disclosed in the solicitation, as discussed under question 3, above.
NAICS codes describe industry categories in very broad terms and cannot
substitute for the detailed evaluation of a specific offeror's
capabilities in response to a solicitation. For example, NAICS code
621111 (Offices of Physicians Except Mental Health Specialists)
includes general family practitioners as well as cardiologists,
dermatologists, ophthalmologists, and pediatricians, among others. The
code itself is too general to provide meaningful insight into the
capabilities available at a specific physician's office. This is
consistent, however, with its function primarily as a statistical tool.
Question 5: How could a business without the proper NAICS
certification be awarded a contract by VA, after which the company then
subcontracts out to a larger business, in violation of the Federal
Acquisition Regulation (FAR)? What is done to correct this problem when
identified?
Response: As noted under Question 4, NAICS codes do not provide
certification as to an offeror's capabilities. Capability is assessed
according to criteria disclosed in the solicitation. As part of
responding to the solicitation, an offeror typically must provide
insight into the staffing of its firm, including education and
experience, past performance as well as the extent to which it will
rely on subcontractors to perform the contract and how it will oversee
and manage those subcontracts to ensure the government's requirements
are met. In general, an offeror has considerable flexibility to
assemble the best team of subcontractors to supplement its own
capabilities as necessary to meet the criteria in the solicitation; the
main limiting factor is that over reliance on subcontractors may result
in a higher price that causes the offeror to be non-competitive and not
win the award in the first place.
However, subcontracting limitations also apply where a small
business wins a contract in a competition restricted to a particular
class of firm, such as a SDVOSB, VOSB, qualified HUBZone small business
concern, or participant in the business development program under
Section 8(a) of the Small Business Act. These programs seek to aid a
targeted class of firms, and the FAR limitations seek to ensure the
assistance actually goes to firms in the targeted class. These
subcontracting limitations are terms of the contract itself and are
enforced just like any other term of the contract.
Question 6: On March 9, 2010, in a Department Memorandum, Jan Frye,
Deputy Assistant Secretary Office of Acquisition and Logistics (OAL),
acknowledged that contract splitting occurred in violation of P.L. 109-
461 by separating one contract into two in order to avoid competition
and giving preferential treatment to a particular contractor. How does
VA ensure such violations are kept to a minimum, especially when eCMS
is not used?
Response: VA is preparing new direction for its contracting
community on this issue. In order to promote competition and to impede
splitting of contracting requirements, the new guidance will require
sole source procurements awarded under P.L. 109-461 to be reviewed and
approved by a management official in the contracting activity. VA plans
to issue this policy in the fourth quarter of 2011. Currently, VA's
approach to minimize violations is through training the program offices
on the issues that contract splitting or fragmenting requirements may
raise, and why they are to be avoided.
Question 7: When a VA employee identifies contracting problems, how
does VA acknowledge his or her effort?
Response: When a VA employee identifies contracting problems, the
supervisor and/or management review the validity of the problem(s). If
the potential contracting problem has merit, necessary actions are
taken to correct the problem. The employee is informed of the results
of the review as to whether or not action was taken. In some instances,
employees are recognized through an ``employee award'' for their effort
in identifying the issue.
Question 8: Does VA review every indication of contracting problems
brought to the attention of management? If not, please describe in
detail the decision process on whether to review a reported problem.
Response: OALC officials review all contracting problems brought to
management. VA expects its managers to address and resolve contracting
problems brought to their attention at the lowest organizational level
possible, in accordance with good management practice. Contracting
problems which cannot be resolved by first line managers are referred
up the chain of command, and additional resources are brought to bear
as needed. Those resources include but are not limited to the Office of
General Counsel, the Office Inspector General, as well as other subject
matter experts.
Question 9: The Subcommittee on Oversight and Investigations found
evidence that, on more than one occasion, a number of blanket purchase
agreements were the result of bundling contracts for services that were
well within the capability of small firms, including Service Disabled
Veteran Owned Small Businesses and Veteran Owned Small Businesses. Not
only did these practices deprive veteran owned businesses of potential
contracts, but it froze them out for a period of 3-5 years. How would
you recommend VA resolve such problems given the relevant statutory
language in Public Law 109-461 and pertinent regulations?
Response: VA's OSDBU reviews all proposed acquisition strategies
involving contract bundling where the anticipated dollar value is at
least $1 million. This is a more stringent standard of review than
specified in the FAR, which directs most agencies to review contract
bundling of anticipated value of $2.5 million or more (FAR Sec. 7.104).
In practice, OSDBU's role is more dynamic than mere concurrence or non-
concurrence with a proposed acquisition strategy. As a participant in
the Integrated Product Teams (IPT) developing acquisition plans for
contracts over $5 million, OSDBU provides market research and
recommendations to the IPTs on how to comply with statutory and
regulatory limitations on bundling, often preventing a potential
inappropriate bundling situation from developing in the first place.
Any contract awarded necessarily excludes unsuccessful offerors for
the term of the contract. During the course of the contract, VA is
committed to obtaining the goods or services specified in the contract
from the awardee(s), by the terms of the contract. The volume of work
to be performed generally drives the level of vendor interest in the
contract and the pricing terms (i.e., volume discounts). Unsuccessful
offerors may perceive this as being excluded from the process but for
the successful offeror it is the consideration received as part of the
contract.
Fragmentation of a requirement among too many vendors drives up
government oversight costs and may reduce vendors' interest in the work
as the lower contract value may mean these vendors have better
``opportunity cost'' on other, larger volume contracts. VA seeks
balance in making these decisions. When VA can use the contract to
provide targeted socioeconomic preference firms at a viable volume of
work, VA establishes contracts and blanket purchase agreements (BPA) to
allow better participation and promote a strong competitive
environment. When VA anticipates a need for additional suppliers or
additional competition during the course of a contracting arrangement,
VA may make multiple awards and compete subsequent purchases among the
awardees.
Question 10: Evidence has been submitted to the Committee of VA
using letter contracts that allow construction work to begin prior to a
price for that work being written in the contract? Why does this
happen, under what circumstances is it permitted, and how can it still
happen even when not permitted?
Response: A letter contract is permissible in accordance with FAR
16.603 and is only utilized when the contracting officer, along with
the approval of the Head of Contracting Activity (HCA), identifies the
urgency of need to fulfill such requirement or service for a specific
project. In the VA major construction program it is extremely rare that
letter contracts are used.
Question 11: How does VA prevent double payments or other
unnecessary payments on a contract? Would more thorough usage of eCMS
prevent these from happening?
Response: VA relies on a manual three-way match of the contract,
invoice, and receipt to prevent double or unnecessary payments. The
contracting officer provides the contracting officer's technical
representative (COTR) with the final contract documents. The COTR uses
the VA Online Certification System (OLCS) to review and certify
invoices for payments. The OLCS also checks for submission of duplicate
invoices prior to notifying the COTR of an invoice submission. The COTR
is notified through an automated email notification when he or she
needs to review and certify an invoice. The COTR compares the invoice
against the contract documents and certifies or refuses (approves or
disapproves) the invoice accordingly. The vendor has to include the
correct VA Purchase Order number on the invoice to facilitate the
process. If a mistake (double payment) has been made VA immediately has
the Austin Finance Center execute a bill of collection to that
contractor.
The VA three-way match process ensures the existence of a contract
and its use by the COTR to review and approve invoices, providing
verification to the Financial Officer who ensures correct payments are
made. Greater use of eCMS supports the three-way match requirement by
making contract documents readily available. The data in eCMS could
provide an additional electronic means for validating payments if
contracting and financial systems were to be integrated at VA.
Question 12: In the hearing before the Oversight and Investigations
Subcommittee on April 13, 2011, Mr. Bob Neary noted the importance of
cost analysis ``in the selection of projects going forward.'' Please
provide a detailed description of the cost analysis process used in
construction contracting.
Response: In selecting projects to go forward, VA uses a cost-
effectiveness analysis (CEA) during the budget formulation/project
selection phase. The CEA is a preliminary step in the construction
contracting process to help ensure an accurate analysis of the status
quo and viable options (construct new, renovate, lease, etc.). The CEA
compares the life cycle cost of the various options and provides the
constant, inflated and discounted values (net present value) of each
option. CEAs are completed by the business case preparers and reviewed
by the Department as part of the Strategic Capital Investment Planning
(SCIP) process, resulting in a prioritized list of capital projects to
be used in formulating the annual budget request. The SCIP process is
completed approximately 12 months prior to funds being appropriated for
a major construction project and possibly several years before a
construction contract is awarded. As a project progresses, initial
planning costs are provided in the SCIP 10-year action plan and SCIP
budget year business case, and at other stages including the Office of
Management and Budget (OMB) submission. A project prospectus is also
provided as part of the congressional budget submission, and costs may
be revised again after final design is completed.
VA's standard practice for cost analysis is a review of historical
data along with the support of the architect-engineer of record's
independent government estimate (IGE). All VA projects have an IGE
which is used to compare cost proposals for determining cost/price to
be fair and reasonable. The majority of VA projects are awarded on a
firm-fixed price basis as a result of full and open competition. In
those relatively few cases where a more detailed cost analysis is
required, however, VA uses the Defense Contract Audit Agency (DCAA) to
conduct an audit of the firm's proposal. DCAA has an agreement with VA
to do this work on a reimbursable basis. The DCAA audit lends support
to the contracting officer in determining that a price is fair and
reasonable.
Question 13: Who conducts the cost analysis and associated
assessments when considering whether a VA structure should be leased,
renovated, or built new?
Response: The first step in deciding which capital solution should
be chosen is to establish the type and level of the health care
services needed and their appropriate location(s). VA's Health Care
Planning Model provides data on the projected Veteran population,
demographics, utilization, and access to assist in this determination.
The second step is to determine the best solution to meet the need
(including SCIP-identified infrastructure gaps) to provide that care--a
new facility, leased facility, renovated facility, or contract care
where appropriate. All capital business case applications for major,
minor, non-recurring maintenance and leases (to include the cost
analysis) are reviewed and prioritized by a Department-wide SCIP Board
and approved through the VA governance process.
VA staff (in most cases located at the facility) conduct the first
cost analysis and associated assessments when considering whether a VA
structure should be leased, renovated, or built new. VA's analysis is
conducted within the framework of governmentwide initiatives like the
President's June 2010 Memorandum on Real Property and E.O. 13514 (on
sustainable buildings). The preparer of the business case application
proposes the method (build new, renovate, lease, etc.) to meet the
identified gaps. The preparer must provide additional justification if
the most cost effective means is the not chosen option. Various
factors--such as the need for additional space, the ability to build on
medical center campuses or renovate existing buildings, the requirement
for quick implementation or flexibility to terminate a contract
(leasing versus construction), and the duration of the need (short term
versus long term)--all go into determining the best solution for
providing the best quality health care. For example, a medical center
campus that is landlocked with no excess space would most likely need
to pursue leasing or contracting out because building on campus or
renovating existing space to provide additional care is not feasible. A
campus with excess building space or acreage may more easily (and
efficiently) renovate space or build new space on the campus.
Question 14: Who reviews the cost analysis and associated
assessments in making decisions towards contracts?
Response: As a project progresses through the development stage and
into the budget formulation/project selection stage, a CEA is required
as part of the business case application. The application, comprised of
questions relating to Departmental decision criteria, is used to
demonstrate the need for, and priority ranking of, the project.
Business cases are evaluated by the local facility director, the
Veterans Integrated Service Network (VISN) Director, and the applicable
administration (Veterans Health Administration, National Cemetery
Administration, or Veterans Benefits Administration), which then
forwards the business cases to the SCIP Board for review and scoring.
The SCIP Board is a Department-wide group consisting of nine members
from the Administrations and select staff offices. The business cases
are also reviewed through the VA governance process, which results in a
prioritized listing of capital projects for the budget year.
Significant projects (such as major construction and leasing) include
detailed cost estimates in their project prospectus, which are reviewed
by the (OMB) and included in the Department's budget submission to
Congress.
Question 15: In considering ``best options'' and a proper cost
analysis, the Oversight and Investigations Subcommittee majority staff
analysis revealed (and was confirmed by an independent third party)
that construction at the Denver replacement medical center facility has
appropriated money in FY 2004, 2006, 2007, 2008, 2009 and 2010 with a
total cost so far approaching half a billion dollars for the addition
of about 40 beds. For comparative purposes, a medical facility in
Washington DC added 220 beds for about $25 Million. How much has the
Denver project cost so far (total)?
Response: As of May 31, 2011, VA has obligated $107.5 million for
the new medical facility in Denver, Colorado. The new 184-bed medical
center will accommodate the Eastern Colorado Health Care System
inpatient tertiary care and ambulatory care functions. The project
includes a 30-bed Spinal Cord Injury/Disorder Center; a 30-bed Nursing
Home Community Living Center; a research building; a central utility
plant; and parking structures. It also includes the remodeling of the
former University Physicians, Inc. building to be the Clinic Building
South, which will house clinical and administrative functions and a
Department of Defense clinic at the top floor. The project will be LEED
silver certified.
The project addresses multiple problems, ranging from correcting
the numerous deficiencies associated with an aging facility to closing
the distance gap between VA's medical school affiliate, the University
of Colorado Hospital. The Denver medical center is over 60 years old,
is inefficient, is space constrained, and will not support the capacity
or quality of Veteran care needed for state-of-the-art treatment. The
current facility lacks the capability to expand to meet the projected
increasing workload demands.
Question 16: Please provide a copy of the Senior Resident Engineer
training lessons.
Response: See attached SRE Training and Development Program
Curriculum.
Question 17: How does VA prevent abuse of OLCS when CFM can request
any Contracting Officer to make payment, especially when invoices do
not have the appropriate accompanying supporting documentation?
Response: OLCS is a dual certification system. A contracting
officer is designated for each specific project in OLCS. Only a single
alternate CO, rather than any CO, is also designated which allows
invoices to be processed in the absence of the designated contracting
officer. Not only does this prevent payment of interest on the
government's part, but ensures timely payment to the contractor. The
requirement for processing invoices is the same for each contracting
officer. They are required to verify the accuracy of such invoice to
ensure compliance with regulations. All documentation for an invoice on
a major construction project is kept at the field office of the Senior
Resident Engineer (SRE). The SRE, who has limited contracting
authority, approves in OLCS that services have been rendered. The
contracting officer then certifies that invoice in OLCS.
Question 18: Please provide a copy of the contract file related to
the company Ellerbe Becket.
Response: The information was submitted to the Subcommittee on
Oversight and Investigations staff and will be retained in the
Committee files.
Question 19: Please provide details on the $99 million procurement
for Advisory and Assistance Services to include the services provided
and whether or not the Chief of Staff has approval authority
(signature) at the same level as the Deputy Secretary.
Response: VA queried the Federal Procurement Data System for
details of the contract referenced in the question and was unable to
identify a VA contract with those characteristics.
In addition, VA's Information Letter (IL) 049-07-10, on Advisory
and Assistance Services, was rescinded August 10, 2010. This IL
required approval by the Secretary or Deputy Secretary for Advisory and
Assistance Services contracts above $1 million. The Veterans Affairs
Acquisition Regulation part 801 sets thresholds for review and approval
of contracts, including legal and technical review, and those
provisions continue to apply. In addition, criteria in FAR subpart 37.2
also apply.
Question 20: What is the present total cost of the San Antonio
Polytrauma project?
Response: The present total cost of the San Antonio Polytrauma
project is $66 million.
Question 21: What penalties currently exist for VA employees who
willfully violate the eCMS usage mandate? What actions are planned to
hold employees accountable for not using eCMS?
Response: Employee accountability for the use of eCMS rests within
the supervisory chain, and ultimately resides with the cognizant Head
of Contracting Activity (HCA). Given the sensitive nature of
performance-based personnel actions and the potential for Privacy Act
issues, VA cannot disclose this information. However, VA is providing
the results of the OIG audit, as well as the results of its own
internal reviews, to the HCAs to discuss corrective action with their
respective staffs. VA concurs in the importance of correcting
noncompliance with eCMS requirements and is directing senior-level
management (HCAs) attention to monitoring and addressing this issue.
Where appropriate, VA will address eCMS noncompliance with
additional training and guidance, but where deficiencies persist, VA
will treat noncompliance as a performance issue and take appropriate
action. Similar to other employee performance management issues,
corrective action(s) taken against employees are determined by the
supervisor and follow VA human resources policy and procedures.
To achieve consistency within the Department, the Office of
Acquisition, Logistics and Construction (OALC) will work with the
Department's Office of Human Resources and Administration and the HCAs
to develop a standard performance measure for inclusion in each VA
contracting officer's individual annual performance work plan on the
use of eCMS to accomplish their contracting assignments. Their use of
the system and the completeness of the contract files within the system
will then be considered when developing their annual performance
rating. We will target this to be effective for the Fiscal Year 2012
rating cycle which begins in October 2011.
Question 22: Do you feel that VA's contract auditing process is
effective and thorough? How could it be improved?
Response: Yes, VA's process is effective and thorough, but
timeliness may be a place to improve. The majority of VA's pre-award
and post-award reviews are done on our Federal Supply Schedule (FSS)
offers and contracts. Pre-award and post-award reviews are normally
triggered by a dollar threshold (estimated value of award or actual
government sales achieved). We also request audits when it is believed
that data may not be accurate or complete. The audit review process,
including both pre-award and post-award reviews, is critical to ensure
the integrity of the program, the pricing, and the best interests of
the government. The pre-award reviews afford contracting staff the
assurance the offeror provided accurate current and complete data and
information.
It also identifies and/or confirms the negotiation starting point.
Post-award reviews ensure the basis of award and price protection
provisions were complied with. The majority, but not all of the post-
award reviews are generated by a self-audit completed by the
contractor. Once notified and receipt is taken of the contractor's
findings, a post-award review is required, which typically finds
additional recovery.
The overall time it takes from the request to auditors to
completion of review is very lengthy, often exceeding 180 days. Most is
driven by the wait for additional information by the offeror/vendor to
be provided, or access to their records.
Question 23: Has VA ever compared its contract auditing process
with other Federal agencies that employ external auditors?
Response: All VA audits are to ensure compliance with applicable
Federal regulation and guidance (e.g. FARs, Generally Accepted
Government Accounting Standards). VA currently uses DCAA for any
changes in excess of $700,000 to major construction contracts and new
awards of architect/engineering contracts $10 million or more for
contracts other than firm-fixed price.
With regard to the FSS program, VA has evaluated the use of outside
auditors. However, this is a unique program only assigned to the
General Services Administration (GSA), who in turn delegated the health
care categories to VA. VA Office of Inspector General reviews the
program and VA has a process to train staff on the unique aspects of
the FSS program. VA will continue to periodically evaluate the best
course of support for the FSS program.
Question 24: In the hearing before the Oversight and Investigations
Subcommittee on April 13, 2011, Mr. Bob Neary noted that VA
Construction does not use a sealed bidding as identified in VA
Acquisition Regulation, Subchapter C, Subpart 81401, Section 814.104.
Please explain in detail why this method is not being used.
Response: The use of sealed bidding and competitive proposals are
both acceptable methods for procuring construction contracts as defined
in the FAR Part 6.401. ``One of the requirements of using the sealed
bid process is that ``the award will be made on the basis of price and
other price-related factors,'' and requirements must be 100 percent
known. VA procurement requirements go well beyond price; price is just
one factor. Contracts to build state-of-the-art VA medical centers and
national cemeteries are awarded to a contractor based on the review of
their past performance, contractor management approach and their small
business participation. Using this ``Best Value'' method for procuring
the new VA medical centers and national cemeteries has provided the
greatest overall benefit for our customers and has shown to have an
overall savings. Therefore, using only the sealed bid process, which is
based on price and price-related factors, would limit the ability to
obtain the ``Best Value'' for our Veterans and taxpayers.
Question 25: Please provide the background on the limited warranted
contracting authority given to Senior Resident Engineers as well as any
changes being considered to this authority.
Response: VA Senior Resident Engineers (SRE) and Resident Engineers
(RE) may receive a Basic C Level Warrant with limited contracting
authority for the specified construction contract which cannot be
utilized without a Contracting Officer Authorization (COA). The basic
level warrant authority for a SRE is $100,000 and $50,000 for a RE. The
SRE and/or RE are required to meet all requirements of the Federal
Acquisition Certification in Contracting (FAC-C) program prior to being
issued a basic level warrant for contracting authority. The language
that is identified on all SRE/RE warrants states ``Expenditures at or
below $100,000 for modifications issued against existing CFM contracts
upon the issuance of a COA letter of delegation.'' The authority for a
SRE and a RE differ, as outlined below:
SRE--The following limitations apply to progress payments, change
orders and supplemental agreements issued under this authorization
order:
a. $100,000 increase or decrease (or estimated increase or
decrease) for any one change except the issuance of a settlement by
determination;
b. Twenty (20) calendar day period between changes issued by same
SRE;
c. $300,000 net increase per calendar month for changes issued by
all SREs for specified project;
d. Authority to stop work for a two work day period in accordance
with FAR 52.242-14, Suspension of Work;
e. All Progress Payments except Final Payment. Any retainage must
be authorized by the Contracting Officer; and
f. This authority expires on the date of final settlement of the
specified construction contract.
RE--The following limitations apply to progress payments, change
orders and supplemental agreements issued under this authorization
order:
a. $50,000 increase or decrease (or estimated increase or
decrease) for any one change except the issuance of a settlement by
determination;
b. Ten (10) calendar day period between changes by the same RE;
c. $150,000 net increase per calendar month for changes issued by
all Res for the specified project;
d. Authority to stop work for a one work day period in accordance
with FAR 52.242-14, Suspension of Work;
e. All Progress Payments except Final Payment. Any retainage must
be authorized by the Contracting Officer; and
f. This authority expires on the date of final settlement of the
specified construction contract.
At this time, VA is not considering a change to the authority for
the SRE and/or RE basic level warrants.
Question 26: As discussed in the hearing before the Oversight and
Investigations Subcommittee on April 13, 2011, by Mr. Haggstrom, please
provide the class schedule for formal training in eCMS at the VA
Acquisition Academy for calendar year 2010, a copy of the course
training guide, and the number of VA employees that underwent this
training during that time period.
Response: All new contracting staff who will use eCMS are required
to undergo eCMS training prior to using the system. In fiscal year
2010, a total of 1,352 users were trained by an eCMS Application
Coordinator or a vendor. Vendors trained 1,119 users through one of the
77 training sessions listed below. Eighty-eight of the 1,119 users who
received Vendor instruction were trained as Application Coordinators
under a ``Train-the-Trainer'' initiative; they will fill the trainer
role within their organization. Application Coordinators trained 233 of
the 1,352 users who received training. The training curriculum is the
same whether provided through the vendor or the Application
Coordinators. VA Acquisition Academy does not provide eCMS training.
------------------------------------------------------------------------
Number of
# Training Dates Location Attendees
------------------------------------------------------------------------
1 Nov. 2-6, 2009 Orlando, FL 24
------------------------------------------------------------------------
2 Nov. 17-20, 2009 Orlando, FL 22
------------------------------------------------------------------------
3 Oct. 5-6, 2009 Dayton, OH 23
------------------------------------------------------------------------
4 Oct. 5-9, 2009 Brecksville, OH 18
------------------------------------------------------------------------
5 Oct. 26-30, 2009 Stafford, VA 11
------------------------------------------------------------------------
6 Nov. 9-13, 2009 Washington, DC 12
------------------------------------------------------------------------
7 Nov. 16-20, 2009 Washington, DC 11
------------------------------------------------------------------------
8 Nov. 17-20, 2009 Long Beach, CA 18
------------------------------------------------------------------------
9 Dec. 1-2, 2009 San Antonio, TX 18
------------------------------------------------------------------------
10 Dec. 3-4, 2009 San Antonio, TX 18
------------------------------------------------------------------------
11 Dec. 1-4, 2009 Hampton, VA 19
------------------------------------------------------------------------
12 Dec. 8-11, 2009 Murfreesboro, TN 10
------------------------------------------------------------------------
13 Dec. 8-11, 2009 Brockton, MA 11
------------------------------------------------------------------------
14 Dec. 15-16, 2009 Murfreesboro, TN 14
------------------------------------------------------------------------
15 Dec. 14-18, 2009 Frederick, MD 14
------------------------------------------------------------------------
16 Jan. 4-8, 2010 Frederick, MD 16
------------------------------------------------------------------------
17 Jan. 12-13, 2010 Chicago, IL 18
------------------------------------------------------------------------
18 Jan. 14-15, 2010 Chicago, IL 20
------------------------------------------------------------------------
19 Jan. 12-13, 2010 Wilmington, DE 14
------------------------------------------------------------------------
20 Jan. 14-15, 2010 Wilmington, DE 6
------------------------------------------------------------------------
21 Jan. 19-22, 2010 Chicago, IL 15
------------------------------------------------------------------------
22 Jan. 21-22, 2010 Murfreesboro, TN 10
------------------------------------------------------------------------
23 Jan. 25-28, 2010 Frederick, MD 15
------------------------------------------------------------------------
24 Jan. 26-27, 2010 Coatesville, PA 14
------------------------------------------------------------------------
25 Jan. 28-29, 2010 Coatesville, PA 16
------------------------------------------------------------------------
26 Feb. 4-5, 2010 New York (Bronx), NY 16
------------------------------------------------------------------------
27 Feb. 2-5, 2010 Eatontown, NJ 18
------------------------------------------------------------------------
28 Feb. 16-17, 2010 Ann Arbor, MI 10
------------------------------------------------------------------------
29 Feb. 18-19, 2010 Ann Arbor, MI 13
------------------------------------------------------------------------
30 Feb. 18-19, 2010 Murfreesboro, TN 11
------------------------------------------------------------------------
31 Feb. 23-24, 2010 Indianapolis, IN 9
------------------------------------------------------------------------
32 Feb. 25-26, 2010 Indianapolis, IN 12
------------------------------------------------------------------------
33 Feb. 23-24, 2010 Dayton, OH 16
------------------------------------------------------------------------
34 Feb. 25-26, 2010 Cleveland, OH 17
------------------------------------------------------------------------
35 Mar. 8-11, 2010 Frederick, MD 17
------------------------------------------------------------------------
36 Mar. 9-10, 2010 Perry Point, MD 17
------------------------------------------------------------------------
37 Mar. 16-17, 2010 Murfreesboro, TN 15
------------------------------------------------------------------------
38 Mar. 15-19, 2010 Bedford, MA 13
------------------------------------------------------------------------
39 Mar. 23-26, 2010 Coatesville, PA 12
------------------------------------------------------------------------
40 Mar. 25-26, 2010 Buffalo, NY 14
------------------------------------------------------------------------
41 Mar. 30-31, 2010 Pittsburgh, PA 14
------------------------------------------------------------------------
42 Apr. 1-2, 2010 Pittsburgh, PA 15
------------------------------------------------------------------------
43 Apr. 6-7, 2010 Arlington, TX 21
------------------------------------------------------------------------
44 Apr. 8-9, 2010 Lyons, NJ 15
------------------------------------------------------------------------
45 Apr. 13-14, 2010 Martinsburg, WV 10
------------------------------------------------------------------------
46 Apr. 15-16, 2010 Martinsburg, WV 12
------------------------------------------------------------------------
47 Apr. 12-13, 2010 Brockton, MA 10
------------------------------------------------------------------------
48 Apr. 15-16, 2010 Manchester, NH 12
------------------------------------------------------------------------
49 Apr. 22-23, 2010 Tampa, FL 19
------------------------------------------------------------------------
50 Apr. 22-23, 2010 Menlo Park, CA 19
------------------------------------------------------------------------
51 Apr. 27-28, 2010 Palo Alto, CA 25
------------------------------------------------------------------------
52 May 4-5, 2010 Lake City, FL 13
------------------------------------------------------------------------
53 May 6-7, 2010 San Juan, P.R. 12
------------------------------------------------------------------------
54 May 11-12, 2010 West Haven, CT 10
------------------------------------------------------------------------
55 May 11-12, 2010 Lyons, NJ 11
------------------------------------------------------------------------
56 May 13-14, 2010 Brockton, MA 16
------------------------------------------------------------------------
57 May 18-19, 2010 Lake City, FL 12
------------------------------------------------------------------------
58 May 18-19, 2010 Milwaukee, WI 12
------------------------------------------------------------------------
59 May 20-21, 2010 Milwaukee, WI 12
------------------------------------------------------------------------
60 May 25-26, 2010 Lake City, FL 10
------------------------------------------------------------------------
61 May 25-26, 2010 New York (Bronx), NY 13
------------------------------------------------------------------------
62 May 27-28, 2010 New York (Bronx), NY 13
------------------------------------------------------------------------
63 Jun. 1-2, 2010 Albany, NY 11
------------------------------------------------------------------------
64 Jun. 10-11, 2010 Houston, TX 13
------------------------------------------------------------------------
65 Jun. 10-11, 2010 Orlando, FL 9
------------------------------------------------------------------------
66 Jun. 15-16, 2010 Minneapolis, MN 19
------------------------------------------------------------------------
67 Jun. 17-18, 2010 Minneapolis, MN 18
------------------------------------------------------------------------
68 Jun. 22-23, 2010 Orlando, FL 8
------------------------------------------------------------------------
69 Jun. 24-25, 2010 Orlando, FL 21
------------------------------------------------------------------------
70 Jun. 24-25, 2010 Long Beach, CA 22
------------------------------------------------------------------------
71 Jun. 29-30, 2010 Syracuse, NY 13
------------------------------------------------------------------------
72 Jul. 22-23, 2010 Orlando, FL 14
------------------------------------------------------------------------
73 Jul. 27-28, 2010 Miami, FL 16
------------------------------------------------------------------------
74 Aug. 10-11, 2010 Omaha, NE 8
------------------------------------------------------------------------
75 Aug. 12-13, 2010 Omaha, NE 9
------------------------------------------------------------------------
76 Aug. 17-20, 2010 Omaha, NE 19
------------------------------------------------------------------------
77 Aug. 24-25, 2010 Dublin, GA 16
------------------------------------------------------------------------
TOTAL ATTENDEES 1,119
------------------------------------------------------------------------
The Enterprise Acquisition Systems (EAS) Service and the Office of
Acquisition Policy developed an eCMS User Guide Index that provides an
integrated, role-based matrix for using the 27 individual eCMS user
guides. The eCMS guides provide users with system information and
include system processes, procedures, and compliance requirements.
Users can access eCMS guides using the following link: http://
arc.aac.va.gov/
Acquisition/ECMS/eCMSTrainingMaterials/Pages/VAARCeCMSUserGuides.aspx
Question 27: Please provide the class schedule for formal training
in Paragon for calendar year 2010 and the number of VA employees that
underwent this training during that time period.
Response: In calendar year (CY) 2010 CFM held a total of eight (8)
classes with a total of ninety-five (95) employees trained. The classes
are held for CFM REs, project managers, clerical assistants, and
contracting officers because Paragon is used primarily for major
construction projects. The group is made up of new CFM employees and
those requiring refresher training. The class schedule for CY 2010 was:
February-9; April-13; June-11; August-11; September-11; October-13;
November-14; and December-13.
__________
Question #16 Response: Attached SRE
Training and Development Curriculum
CFM
Senior Resident Engineer (SRE) Training & Development Program
Curriculum
Standardized Curriculum for Face-to-Face Training
SRE Development Program will be 2 years in duration, with face-to-
face training scheduled every quarter if possible. Group training will
incorporate core technical and management skills for Resident Engineers
seeking to develop the expertise of an SRE. Priority numbers indicate
preferred sequence of training over 2 years.
----------------------------------------------------------------------------------------------------------------
Dates
Training Priority Trainers Time Notes Category Done
----------------------------------------------------------------------------------------------------------------
Priority for session planning 23 hrs
purposes
----------------------------------------------------------------------------------------------------------------
Program Orientation 1 Internal--SREs & 4 hrs #1 & #2 on 1--SRE
Senior Mgt original Development
curriculum Orient./CFM
combined to Org.
total approx.
3.5 days.
----------------------------------------------------------------------------------------------------------------
IDP for SRE Development 1 Internal--SRE 1 hr 1--SRE
and Coach Development
Orient./CFM
Org.
----------------------------------------------------------------------------------------------------------------
Color of Money, Contingency 1 Arlyce 2 hrs 2--Office Admin
Management, FITT, PMDRI & Operations
(File 13)
----------------------------------------------------------------------------------------------------------------
Filing Systems, Office 1 Dana Quel 3 hrs How to 4--Contract
Organization and Procedures administer an Admin/
office, manage Documentation
correspondence
and other
paperwork.
----------------------------------------------------------------------------------------------------------------
Preconstruction Meeting With 1 Derek Underwood 2 hrs Procedure for 4--Contract
Contractors and VA Clients conducting pre- Admin/
construction Documentation
and partnering
meetings,
purpose of
meetings, key
areas to
cover,
coordination
between
parties in
setting up
meeting, etc.
----------------------------------------------------------------------------------------------------------------
Understanding Up-Front Specs: 1 Ed Nicholson/ 8 hrs How to read 5--Construction
General Conditions, General Reginald Berry them, why it Contracts
Requirements, etc. is important
to read them.
Avoiding
unnecessary
expense. Use
``Real''
documents as
exercise. Need
someone to
discuss each
Act and SRE
roles/
responsibiliti
es
----------------------------------------------------------------------------------------------------------------
Setting Up the Office (How To/ 1 SRE & PM 2 hr Trailers, 2--Office Admin
Logistics) supplies/ & Operations
lists,
clerical,
mail,
contracts
----------------------------------------------------------------------------------------------------------------
Interfacing With Medical 1 Coaches; perhaps 1 hr What to expect 4--Contract
Center, Relationship to VAMC Chief of Relationship Admin/
Director, Engineering, and Engineering. Things to Documentation
Shops consider
Use FAB
``Interface''
Issue.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Dates
Training Priority Trainers Time Notes Category Done
----------------------------------------------------------------------------------------------------------------
2 36.5 hrs
----------------------------------------------------------------------------------------------------------------
Travel 2 Shavonne Rush 1 hr 3--Personnel
(Self & Staff)
Admin.
----------------------------------------------------------------------------------------------------------------
Safety: SRE Responsibilities, 2 Internal--SRE, 8 hrs 4--Contract
Contractor Responsibilities, CEOSH Admin/
and Reporting Requirements Documentation
----------------------------------------------------------------------------------------------------------------
Davis Bacon Act/Labor 2 Robert Nowak 2 hrs What are the 5--Construction
Provisions wages unique Contracts
to the job
location
(under DOL).
Wage report
used in
contract.
Ensure
contractor is
paying proper
wages, how
payroll is
presented,
etc.
----------------------------------------------------------------------------------------------------------------
Testing Lab Contracts 2 Internal 1 hr What is the 5--Construction
SRE's Contracts
responsibility
with these
contracts.
----------------------------------------------------------------------------------------------------------------
Review NAS Specifications 2 Bill Goodman 4 hrs 5--Construction
Contracts
----------------------------------------------------------------------------------------------------------------
Submittal Process 2 Coaches 1 hr Review spec 4--Contract
section 01340 Admin/
Documentation
----------------------------------------------------------------------------------------------------------------
A/E & CM Contracts during 2 Katie Kuehn 1 hr Contractors 5--Construction
Construction Period Service Support Contracts
----------------------------------------------------------------------------------------------------------------
Ethics 2 Ethics attorney 1 hr 6--Leadership/
Sup./Self
Improve.
Skills
----------------------------------------------------------------------------------------------------------------
Progress Payments (General 2 Jane Houston/ 2 hrs Progress 4--Contract
Conditions and Online Adelino payments Admin/
Payments) ``Dino'' procedures, Documentation
Gorospe things to
check before
submitting
payments,
retainage,
Online
certification
process,
prompt payment
requirements/
interest, etc.
----------------------------------------------------------------------------------------------------------------
Change Clauses: FAR & VARR 2 General Counsel 4 hrs 5--Construction
and REs Contracts
----------------------------------------------------------------------------------------------------------------
Correspondence/Writing Skills 2 TBD 1 day VBA has writing 6--Leadership/
for Federal Managers course for Sup./Self
their Improve.
managers; Skills
Arlyce will
get a copy.
----------------------------------------------------------------------------------------------------------------
Acting Within Your Authority 2 Diane Campbell/ 1.5 hr Limits to
Sheila Authority,
Watterson Warrant
Limits, COA
Delegation
Letter, Review
Thresholds/
Actions
Requiring
Higher
Approval, etc.
----------------------------------------------------------------------------------------------------------------
Unauthorized Commitments/ 2 Thaddeus 2 hrs Avoiding
Ratifications Willoughby Unauthorized
Commitments,
Legal
Penalties,
Process for
Ratification,
Disciplinary
Actions, etc.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Training Priority Trainers Time Notes Category Dates
Done
----------------------------------------------------------------------------------------------------------------
3 18.5 -24.5
hrs
----------------------------------------------------------------------------------------------------------------
T & L Requirement, 3 Sheila Walker 2 hrs 3--Personnel
Regulations, Reporting, OT (Self & Staff)
and Comp Time Admin.
----------------------------------------------------------------------------------------------------------------
Conducting Meetings 3 Robert Nowak 1 hr 6--Leadership/
Sup./Self
Improve.
Skills
----------------------------------------------------------------------------------------------------------------
Project Planning Process 3 Dennis Sheils 1 hr 1--SRE
Development
Orient./CFM
Org.
----------------------------------------------------------------------------------------------------------------
Compliance Reviews 3 Dennis Milsten, 2 hrs 4--Contract
Alan Trow Admin/
Documentation
----------------------------------------------------------------------------------------------------------------
Project Documentation and 3 Kyrgos, Contract 3 hrs Processing 4--Contract
File Management, Inc. Specialists invoices, Admin/
Administering Contracts in maintaining Documentation
the Field Contract
Administration
files in PM
field offices
----------------------------------------------------------------------------------------------------------------
Understanding and 3 Coaches/PMs/GCs 1 hr 5--Construction
Communicating Project Contracts
Specifications
----------------------------------------------------------------------------------------------------------------
Unsolicited Proposals 3 Steffanie Wood 1/2 hr 5--Construction
Contracts
----------------------------------------------------------------------------------------------------------------
Warranted RE Responsibilities 3 Adelino Gorospe 1 hr 5--Construction
Unauthorized Commitment Contracts
----------------------------------------------------------------------------------------------------------------
Change Orders (CO) 3 Kathy Volpe/ 4 hrs Changes 5--Construction
Supplemental Agreement (SA) Robert Kellner Clauses, Contracts
``How to''--Directive Memo Change Order
for Record, Distribution, and
Forward Pricing, Pre- Supplemental
Negotiation Objectives Types Agreements
of Modifications Change procedures,
Clauses: FAR & VARR Material Pricing/
Storage On & Off Site Negotiation,
Special Types
of Changes
(i.e.
Materials
Storage), etc.
----------------------------------------------------------------------------------------------------------------
Communication, Team Building, 3 1 hr 6--Leadership/
Partnering Sup./Self
Improve.
Skills
----------------------------------------------------------------------------------------------------------------
FAC-C, Warrant, Continuing 3 Myra Williams/ 1 hr FAC-C
Ed. Points Greg Sabater requirements,
warrant levels
and
thresholds,
Continuing
Education
Points
requirements/
ways to earn
Continuing Ed.
----------------------------------------------------------------------------------------------------------------
Contracting Responsibility 3 Susan Lam/Chris 1 hr (CO)Working with
for CPM Schedule (i.e. Time Kyrgos hr (CPM)CPM, Checking
Extensions, Progress schedule prior
Payments, etc.) to actions
(Changes &
progress
payments),
Critical Path
impact,
frequency of
CPM reports,
actions you
can take if
contractor is
off schedule,
etc.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Training Priority Trainers Time Notes Category Dates
Done
----------------------------------------------------------------------------------------------------------------
4 21 hrs
----------------------------------------------------------------------------------------------------------------
Critical Path Method (CPM) 4 Bill Goodman 2 days Mid first-year 5--Construction
Time Extension Analysis issue. Can Contracts
this be taught
in field
offices?Ask
Neary.
----------------------------------------------------------------------------------------------------------------
Consulting Support Services 4 Sat Gupta 1 hr Learn what they 1--SRE
do, how they Development
can help. Orient./CFM
Org.
----------------------------------------------------------------------------------------------------------------
Role of the Project Manager, 4 Bob Clifton 2 hrs Contact PMs by 1--SRE
Understanding Relationship phone; arrange Development
of the SRE/PM Through the office visit Orient./CFM
Project Process, Roles and if possible. Org.
Responsibilities Authority
----------------------------------------------------------------------------------------------------------------
eCMS Training/FPDS 4 Frank Clemons 2 hrs Overview of
eCMS & FPDS,
need for
actions to be
submitted via
eCMS, FPDS
report/annual
certification
of data, etc.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Training Priority Trainers Time Notes Category Dates
Done
----------------------------------------------------------------------------------------------------------------
5 16 hrs
----------------------------------------------------------------------------------------------------------------
Paragon Reports for the SRE 5 Jim MacMorran, 4 hrs 4--Contract
Gail Smith Admin/
Documentation
----------------------------------------------------------------------------------------------------------------
Performance Appraisals 5 Sheila Walker 2 hrs HR to tailor to 3--Personnel
REs/SREs. (Self & Staff)
Admin.
----------------------------------------------------------------------------------------------------------------
Performance-Based 5 Sabrina Clark 2 hrs 3--Personnel
Interviewing (Self & Staff)
Admin.
----------------------------------------------------------------------------------------------------------------
Understanding the Leasing 5 George 2 hrs Was ``Leasing 4--Contract
Process SRE Managing a Lease Szwarcman, Real for REs'' Admin/
Estate Could include Documentation
Specialists attendees not
in the SRE
program.
----------------------------------------------------------------------------------------------------------------
NCA Projects & Programs 5 Rick Petersen 2 hrs Expectations 4--Contract
and program Admin/
overview. Documentation
----------------------------------------------------------------------------------------------------------------
Develop skills to evaluate 5 TBD 1 hr 6--Leadership/
staff capabilities & provide Sup./Self
guidance for their future Improve.
development. Skills
----------------------------------------------------------------------------------------------------------------
Complaint/conflict resolution 5 TBD 1 hr 6--Leadership/
skills to effectively Sup./Self
receive, evaluate, and Improve.
resolve complaints. Skills
----------------------------------------------------------------------------------------------------------------
FOIA Request and Release of 5 Noella Bond/ 1 hr Taking proper
Contract Information David Reich/ action when
John Ezell receiving a
FOIA request,
protecting
procurement
sensitive
information
(cannot be
released to
anyone outside
of contracting
at any time),
types of
procurement
sensitive
information,
interaction
with vendors
without
releasing
protected
information,
etc.
----------------------------------------------------------------------------------------------------------------
Cost Savings 5 Jose Bumbray/ 1 hr OMB Initiative
Frank Clemons
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Dates
Training Priority Trainers Time Notes Category Done
----------------------------------------------------------------------------------------------------------------
6 21--25 hrs
----------------------------------------------------------------------------------------------------------------
Timely Project Close-Out, 6 Euclides Barrera 1 hr Procedures for 4--Contract
Construction and A/E, close-out, Admin/
Warranties/Manuals/As-Builts documents Documentation
and File Transfer checks, punch-
list,
warranties,
etc.
----------------------------------------------------------------------------------------------------------------
Final Inspection: 6 Dana Quel 3 hrs 4--Contract
Requirements, Field Admin/
Inspection, Custody and Documentation
Transfer
----------------------------------------------------------------------------------------------------------------
Change Clauses: Rule 4 File 6 General Counsel 1 hr Compilation of 5--Construction
Procedures every document Contracts
related to a
dispute; used
to defend govt
position in a
dispute.
----------------------------------------------------------------------------------------------------------------
Evaluation of A/E & 6 Noella Bond 2 hrs Evaluations
Contractors (ACASS Training/ Reports, CPARS
CPARS) and ACAS
systems,
ongoing
evaluations/
corrective
actions.
----------------------------------------------------------------------------------------------------------------
Understanding Contracting 6 Ed Nicholson 2 hrs 5--Construction
Officer Decision Procedures Contracts
----------------------------------------------------------------------------------------------------------------
Suspension of Construction 6 General Counsel 4-8 hrs 5--Construction
Work Via Change Order or & REs Contracts
Other Actions
----------------------------------------------------------------------------------------------------------------
Negotiation Skills 6 External 1 day 6--Leadership/
Sup./Self
Improve.
Skills
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Training Priority Trainers Time Notes Category Dates
Done
----------------------------------------------------------------------------------------------------------------
7 24 hrs
----------------------------------------------------------------------------------------------------------------
BIM Process 7 Renee Tietjen 1 hr 1--SRE 11/
Development 2010
Orient./CFM
Org.
----------------------------------------------------------------------------------------------------------------
Construction Cost Estimating 7 Bob Smoot/ 2 hrs 6--Leadership/ 11/09
Michael Koch Sup./Self
Improve.
Skills
----------------------------------------------------------------------------------------------------------------
Energy Management 7 Kurt Knight 1 hr 1--SRE
Development
Orient./CFM
Org.
----------------------------------------------------------------------------------------------------------------
Physical Security 7 Kurt Knight 1 hr 1--SRE
Requirements Development
Orient./CFM
Org.
----------------------------------------------------------------------------------------------------------------
FAC-C Certification Other 7 Greg Sabater 1 hr 1--SRE
Contracting Training Utilize Development
the Academy Keep Up With Orient./CFM
Training Org.
----------------------------------------------------------------------------------------------------------------
Public Speaking/Communicating/ 7 Internal 2 hrs 3--Personnel
5-Minute Presentations (Self & Staff)
Admin.
----------------------------------------------------------------------------------------------------------------
Responsibilities When an RE 7 Noella Bond 1 hr 4--Contract
is on TEB Pre-Award and Post- Admin/
Award Debriefings Documentation
----------------------------------------------------------------------------------------------------------------
A/E Selection Criteria/ 7 Bob Smoot 2 hrs 5--Construction
Process, Inc. Brooks Bill Contracts
----------------------------------------------------------------------------------------------------------------
Historical Preservation, 7 Kathleen 1 hr 5--Construction
Understanding Program and Contracts
SRE Rules & Regulations
----------------------------------------------------------------------------------------------------------------
Supervisory Skills and 7 1 day Is this part of 6--Leadership/
Performance Management LDMP? Sup./Self
Improve.
Skills
----------------------------------------------------------------------------------------------------------------
Source Selection Process 7 Brian Johnson/ 4 hr Role of
Robert Capers Technical
Evaluation
Team in FAR 15
source
selections,
comments
supporting
ratings,
correlating
ratings to
evaluation
factors,
protest risks,
etc.
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Dates
Training Priority Trainers Time Notes Category Done
----------------------------------------------------------------------------------------------------------------
8 20 hrs
----------------------------------------------------------------------------------------------------------------
Claims Avoidance and 8 Scott Lowe 2.5 days 7--Construction
Mitigation Claims/
Disputes
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Training Priority Trainers Time Notes Category Dates
Done
----------------------------------------------------------------------------------------------------------------
Additional Recommended
Training
----------------------------------------------------------------------------------------------------------------
Complete the ``Supervisory 9 Self 40 hrs 6--Leadership/
Models'' Sup./Self
Improve.
Skills
----------------------------------------------------------------------------------------------------------------
VALU/CFM Leadership 9 Internal and 4 formal 1--SRE
Development Mentoring External sessions/ Development
Program (LDMP) or VALU/CFM year Orient./CFM
Aspiring Leaders Program Org.
(ALP)
----------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------
Committee on Veterans' Affairs
Subcommittee on Oversight and Investigations
Washington, DC.
May 2, 2011
Mr. Glenn D. Haggstrom
Executive Director, Office of Acquisitions, Logistics, and Construction
U.S. Department of Veterans Affairs
810 Vermont Avenue, NW
Washington, DC 20420
Dear Mr. Haggstrom:
I would like to request your response to the enclosed deliverable I
am submitting in reference to our House Committee on Veterans' Affairs
Subcommittee on Oversight and Investigations hearing on Inspect What
You Expect: Construction Contracting Practices at VA on April 13, 2011.
Please answer the enclosed hearing questions and deliverables by no
later than Monday, May 30, 2011.
In an effort to reduce printing costs, the Committee on Veterans'
Affairs, in cooperation with the Joint Committee on Printing, is
implementing some formatting changes for material for all full
Committee and Subcommittee hearings. Therefore, it would be appreciated
if you could provide your answers consecutively on letter size paper,
single-spaced. In addition, please restate the question in its entirety
before the answer.
Due to the delay in receiving mail, please provide your response to
Ms. Orfa Torres by fax at (202) 225-2034. If you have any questions,
please call (202) 225-9756.
Sincerely,
Joe Donnelly
Ranking Member
MH/ot
__________
The Honorable Joe Donnelly, Ranking Member
Subcommittee on Oversight and Investigations
House Committee on Veterans Affairs
``Inspect What You Expect: Construction Contracting Practices at VA''
April 13, 2011
Question 1: I ask that you review your performance measures and
provide us the names of the mid-management level staff that are not
using eCMS or mandating the use of their subordinates. How is the VA
planning to penalize and hold them accountable?
Response: Employee accountability for the use of eCMS rests within
the supervisory chain, and ultimately resides with the cognizant Head
of Contracting Activity (HCA). Given the sensitive nature of
performance-based personnel actions and the potential for Privacy Act
issues, VA cannot disclose this information. However, VA is providing
the results of the Office of Inspector General (OIG) audit, as well as
the results of its own internal reviews, to the HCAs to discuss
corrective action with their respective staffs. VA concurs in the
importance of correcting noncompliance with eCMS requirements and is
directing senior-level management (HCAs) attention to monitoring and
addressing this issue.
Where appropriate, VA will address eCMS noncompliance with
additional training and guidance, but where deficiencies persist, VA
will treat noncompliance as a performance issue and take appropriate
action. Similar to other employee performance management issues,
corrective action(s) taken against employees are determined by the
supervisor and follow VA human resources policy and procedures.
To achieve consistency within the Department, the Office of
Acquisition, Logistics and Construction (OALC) will work with the
Department's Office of Human Resources and Administration and the HCAs
to develop a standard performance measure for inclusion in each VA
contracting officer's individual annual performance work plan on the
use of eCMS to accomplish their contracting assignments. Their use of
the system and the completeness of the contract files within the system
will then be considered when developing their annual performance
rating. We will target this to be effective for the Fiscal Year 2012
rating cycle which begins in October 2011.
Question 2: Provide the Subcommittee a quarterly update on the eCMS
utilization statistics within the Department. The 17 percent
utilization rate and almost $1.4 billion not being tracked is
troubling.
Response: OALC's internal review does not support the 17 percent
utilization rate, and as a result, we cannot discuss its legitimacy.
OALC tracks monthly metrics including eCMS Award Dollar Value,
which corresponds most closely for the data matching analysis the OIG
performed to assess eCMS usage. This monitors cumulative obligation
figures, mapping the throughput of dollar awards in eCMS. For Fiscal
Year 2011 (through April), this measure shows $5.98 billion in total
cumulative dollar awards. OALC targeted $12 billion in total eCMS usage
for FY 2011.
For comparison, the following chart shows similar measures for
prior fiscal years:
------------------------------------------------------------------------
Fiscal Year eCMS Award Dollar Value at Year-End
------------------------------------------------------------------------
2008 $5.4 billion
------------------------------------------------------------------------
2009 $8.6 billion
------------------------------------------------------------------------
2010 $11.6 billion
------------------------------------------------------------------------
VA concurs in the need for valid and reliable metrics to track eCMS
use. Accordingly, VA relies on transactional statistical data such as
eCMS award dollar value to provide statistics suitable for year-over-
year comparison, to track progress. However, VA also concurs in the
need for qualitative reviews to provide information useful for the HCAs
and supervisors so they may take appropriate corrective action, even
though the results of such qualitative reviews may not be produced in
statistical form.
VA will develop a report that can be used proactively by acting
Chief Acquisition Officer HCAs in ensuring eCMS usage. This report
could be used to update the Subcommittee upon request. The first report
can be provided within 30 days after the end of the 4th qtr FY 2011.