General Services Administration: Contract Guard Services at the Anchorage
Federal Building (Letter Report, 10/10/2000, GAO/GAO-01-75).

A company formed by security guards at the Anchorage, Alaska, Federal
Office Building (AFOB) competed unsuccessfully for two contracts and
later alleged bias and preselection by the General Services
Administration (GSA) in the contract award process. However, GAO's
review of relevant documentation and discussions with officials of GSA
and the company that alleged the irregularities did not disclose any
evidence of bias or preselection in GSA's award of these contracts. GSA
appears to have inadvertently used an outdated Department of Labor (DOL)
wage determination in its most recent contract because of a
misunderstanding of the wage determination process and incorrect advice
provided by DOL in 1999. On the basis of the substantial amount of
information GAO was able to obtain, including documents and oral
information from the guards and GSA officials, GAO concludes that GSA
could have done more to respond to the guards' concerns and help ensure
and document that the contractor was providing for the safety of federal
employees and the security of federal facilities in accordance with the
contract. Also, GSA could have done more to respond to the guards'
repeated charges of unfair labor practices directed at this same
contractor throughout most of the contract period. Contract performance
was interrupted when the guards went on strike against the contractor.
The strike potentially jeopardized security at AFOB and cost GSA an
undetermined sum of money.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  GAO-01-75
     TITLE:  General Services Administration: Contract Guard Services
	     at the Anchorage Federal Building
      DATE:  10/10/2000
   SUBJECT:  Federal office buildings
	     Federal property management
	     Compensation
	     Labor unions
	     Strikes (labor actions)
	     Facility security
	     Security services contracts
	     Contract administration
	     Contractor personnel
	     Wage surveys
IDENTIFIER:  Anchorage Federal Office Building (AK)

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GAO-01-75

United States General Accounting Office
GAO

Report to the Honorable Don Young

House of Representatives

October 2000

GAO-01-75

GENERAL SERVICES ADMINISTRATION
Contract Guard Services at the Anchorage Federal

Building

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Contents
Page 361      GAO-01-75 Anchorage Federal Building
Letter                                                                      1
                                                                             
Appendix I                                                                 38
Scope and Methodology
                                                                             
Appendix II                                                                40
Comments From the
General Services
Administration
                                                                             
Appendix III                                                               42
GAO Contacts and Staff
Acknowledgments
                                                                             

Abbreviations

AFOB      Anchorage, AK, Federal Office Building
DOJ       Department of Justice
DOL       Department of Labor
FAR       Federal Acquisition Regulation
GSA       General Services Administration
ISI       International Services, Inc.
MOU       memorandum of understanding
NLRB      National Labor Relations Board
OIG       Office of the Inspector General
UGSOA     United Government Security Officers of
America

Page 30       GAO-01-75 Anchorage Federal Building
October 10, 2000

The Honorable Don Young
House of Representatives

Dear Mr. Young:

This report responds to your July 12, 1999,
request for us to review both the level of
physical security provided and the administration
of the contract for security guard services at the
Anchorage, AK, Federal Office Building (AFOB) by
the General Services Administration (GSA). We
provided information on the level of physical
security provided by GSA at AFOB in testimony we
presented before the Subcommittee on Oversight,
Investigations, and Emergency Management, House
Committee on Transportation and Infrastructure, on
October 7, 1999.1

As agreed with your office, this report addresses
your concerns about whether GSA (1) was biased or
preselected the contractors awarded the two most
recent contracts for security services at AFOB,
(2) used appropriate wage determinations for
compensating the contract security guards under
contracts awarded by GSA for guard services at
AFOB since 1996, and (3) responded appropriately
to guard allegations that the security guard
contractor at AFOB for most of the period since
1996 was not complying with important contract
requirements and was committing what the guards
referred to as unfair labor practices.

Results in Brief
A company formed in part with members of the
security guard workforce at AFOB competed
unsuccessfully for these two contracts and
subsequently alleged bias and preselection by GSA
in the contract award process. However, our review
of relevant documentation and discussions with
officials of GSA and the company that alleged the
irregularities did not disclose any evidence of
bias or preselection in GSA's award of these
contracts.

GSA appears to have used the appropriate wage rate
of $11.09 per hour for security guards as
determined by the Department of Labor (DOL) for
federal labor contracts for the contract awarded
in 1996 and for the two option-year extensions
under that contract exercised in 1997 and 1998.2
For the 2-month interim contract awarded in 1999,
GSA appears to have used the appropriate wage rate
of $12.62. However, GSA appears to have
inadvertently used an outdated DOL wage
determination in its most recent contract because
of a misunderstanding of the wage determination
process and incorrect advice provided by DOL in
1999. As a result, GSA's most recent contract
provides for an hourly wage rate of $11.09 instead
of $12.62, which, according to DOL, is the correct
wage rate. DOL acknowledged that similar confusion
could also exist at other federal agencies
concerning the use of certain wage determinations.

All of the documentation needed to fully assess
GSA's response to the guards' allegations that the
security guard contractor at AFOB from August 1,
1996, through July 31, 1999, was not meeting
important contractual responsibilities was not
available. However, on the basis of the
substantial amount of information we were able to
obtain, including certain documents and oral
information from the guards and GSA officials, it
appears that GSA could have done more to respond
to the guards' concerns and help ensure and
document that the contractor was providing for the
safety of federal employees and the security of
federal facilities in accordance with the
contract.

For example, the guards alleged to GSA that some
weapons provided by the contractor were
substandard, and they said that GSA did not always
act to determine whether these weapons were
acceptable. As a result, according to the guards,
many of them carried their personal weapons while
on duty. The Federal Acquisition Regulation (FAR)
requires agencies to ensure that services provided
by contractors meet requirements. It appears that
GSA could have done more to ensure that it was
getting what it was paying for in light of the
guards' allegations to the contrary and that, if
necessary, corrective action was taken.

In addition, GSA could have done more to respond
to the guards' unfair labor practice charges
repeatedly directed at this same contractor
throughout most of the contract period. The guards
informed GSA on numerous occasions of the
importance of these issues to them, issues that
related primarily to their pay and benefits; they
warned GSA that if it did not assist in resolving
the issues, the guards would strike. However, GSA
generally did not act to help resolve the issues
or refer the labor-management issues to an
appropriate agency that could help resolve them or
refer the guards' complaints about pay and
benefits to DOL. The FAR provides that federal
contracting agencies are to (1) remain impartial
in labor-management disputes but see that
appropriate assistance is obtained to help resolve
the disputes so that contract performance is not
interrupted and (2) refer complaints about pay and
benefits to DOL.

Moreover, contract performance was interrupted
when the guards went on strike against the
contractor. The strike potentially jeopardized
security at AFOB and cost GSA an undetermined sum
of money. Prior to the strike, the guards
contacted the National Labor Relations Board
(NLRB), which investigated their complaints and in
August 1999 charged the contractor with violations
of the National Labor Relations Act. A final
ruling on these charges by NLRB had not been
issued as of September 2000.

We are making recommendations to the Administrator
of GSA concerning the responsibilities of GSA
Region 10 officials and possible training and
supervision needed to ensure that contracting
officials follow appropriate laws and regulations
and that GSA reach an understanding with DOL that
will ensure that appropriate wage determinations
are used in GSA contracts. Also, we are
recommending that the Secretary of Labor take
action to ensure that other federal agencies
understand DOL's position relating to the use of
certain wage determinations.

GSA generally agreed with the information in our
report and with our recommendations. DOL pointed
out that our draft report reflected some confusion
concerning the appropriate wage determinations GSA
should have used in certain situations,
acknowledged that this confusion may exist at
other federal agencies that use these wage
determinations, and agreed with our recommendation
to the Secretary of Labor. We clarified our report
to reflect DOL's comments.

Background
In response to the bombing of the federal building
in Oklahoma City in April of 1995, the President
directed the Department of Justice (DOJ) to assess
the vulnerability of federal office buildings,
particularly to acts of terrorism and other forms
of violence. The June 1995 report stemming from
that study recommended specific minimum security
standards for federal buildings and criteria,
guidance, and time tables for evaluating security
needs and improving security at these buildings.
The President delegated GSA the responsibility for
upgrading security at federal buildings under its
control.

The Federal Protective Service (FPS) is GSA's arm
responsible for managing the physical security in
and around GSA-controlled facilities nationwide,
investigating incidents and criminal complaints
occurring on GSA properties, and conducting risk
assessments of federal facilities. FPS has staff
in each of GSA's 11 regions, including uniformed
Federal Protective Officers, physical security
specialists, criminal investigators, and contract
security guards. To help meet the increased
building security responsibilities that resulted
from the DOJ study, FPS initiated a multimillion-
dollar building security enhancement program and
more than doubled its contract security guard
workforce. As of July 2000, about 7,000 security
guards were working under contracts with FPS. With
estimated fiscal year 1999 obligations of about
$119 million, contract guard services represented
the single largest item in FPS' operating budget.

GSA contract guards usually carry firearms and are
deployed at fixed and/or roving posts in and
around the perimeter of federal facilities. They
often operate security-screening devices, such as
magnetometers and x-ray machines, and respond to
calls for security services in and around federal
buildings.

A recent GSA Office of Inspector General (OIG)
report on its audit of FPS' contract guard program
performed between February and December 1999 found
serious problems with FPS' management of these
contracts. Among other things, the report stated
that offices operated mostly autonomously and have
followed disparate practices in critical program
areas, such as contract guard training and
contract enforcement.3 The report said that owing
to the absence of oversight and programmatic
controls, operational breakdowns and questionable
practices have occurred at the regional level,
including inconsistent contract enforcement and
oversight of contractors. The report concluded
that as a result, the safety and protection of
federal employees and facilities were potentially
being compromised. The audit was conducted at 6 of
GSA's 11 regional offices and at FPS' central
office in Washington, D. C. However, it did not
include audit work in Alaska or in GSA's
Northwest/Arctic Region 10, which is headquartered
in Auburn, WA.

Region 10 has responsibility for AFOB, including
providing for its security. In June 1996, Region
10 officials contracted with International
Services, Incorporated (ISI), of Torrance, CA, to
provide security guard services for several
federal facilities in Alaska, including Anchorage,
Juneau, and Fairbanks. The contract was awarded
for 1 year, beginning August 1, 1996, with an
option for GSA to extend the contract for 4
consecutive years. GSA exercised its option and
extended the contract with ISI in August 1997 and
again in August 1998. However, for several
reasons, GSA decided not to extend the contract
with ISI for the 1-year period that was to begin
on August 1, 1999.

Because GSA was unable to advertise and award a
new contract that could be in effect by August 1,
1999, it awarded an interim 2-month contract for
security guard services. GSA's contracting officer
in Anchorage awarded the interim contract to NANA
Management Services, Inc., (NANA) of Anchorage,
AK; the contract was in effect from August 1
through September 30, 1999. Subsequently, GSA's
regional office awarded a new longer term contract
(1 year with 4 option years) to American Guard
Services, Inc., (American Guard) of Los Angeles,
CA, which was effective October 1, 1999.

Beginning in about mid-1997, a number of the
contract guards began to voice numerous complaints
to GSA about ISI. Their complaints involved such
issues as poor quality or nonexistence of
equipment that the GSA contract required ISI to
provide, such as weapons, ammunition, and foul
weather gear; and ISI's inaccurate determination
and administration of their regular and overtime
pay and benefits. The guards eventually brought
their concerns to the Alaska congressional
delegation, the President and Vice President of
the United States, DOL, and NLRB. In April 1999,
with their complaints substantially unresolved,
the guards began a labor strike against ISI that
lasted until GSA's new guard contract with NANA
was effected on August 1, 1999.

We performed our work between October 1999 and
September 2000 in accordance with generally
accepted government auditing standards. We
requested comments on a draft of this report from
the Administrator of GSA and the Secretary of
Labor. Their comments are addressed at the end of
this report. A detailed discussion of our scope
and methodology is presented in appendix I.

No Evidence of Bias or Preselection
A company formed in part with members of the
contract security guard workforce at AFOB, Mt.
McKinley Security and Investigation Services
(McKinley), unsuccessfully competed for both the
GSA interim, 2-month contract and the longer term
contract effective October 1, 1999. McKinley
subsequently alleged irregularities in the award
process for both

contracts-GSA bias against McKinley on the award
of the interim contract and illegal preselection
of the company awarded the longer term contract.
However, on the basis of our review of relevant
documentation and discussions with GSA and
McKinley officials, we believe the charges of
irregularities in the award process for the two
contracts are not supported by the facts.
Specifically, we found no evidence of bias or
preselection by GSA in its award of either of
these contracts. Also, although the General
Accounting Office is one of the forums to which
McKinley could have protested GSA's award of the
two contracts, it did not avail itself of this
remedy.

The 2-Month Interim Contract
According to GSA contracting officials and
documentation we reviewed, an interim contract for
the period August 1, 1999, through September 30,
1999, was necessary because of the timing of the
decision by Region 10 FPS officials to not
exercise the third option year of the contract
with ISI. The decision not to exercise the option
was made in late May 1999. GSA attempted to
negotiate with ISI for a 60-day extension to the
existing contract but was not successful. When
negotiations with ISI failed, GSA decided to issue
a solicitation for a 2-month "interim" contract.
GSA officials said that this allowed them the
additional time needed to solicit and award the
longer term contract.

According to regional contracting officials, they
began the acquisition process on about July 7.
Under the FAR, government agencies must publicize
their contracting opportunities. In accordance
with this requirement, GSA entered the
presolicitation notice of its intention to award
the 2-month contract into the Commerce Business
Daily Internet site on July 8; the solicitation
was entered on July 12. The solicitation asked
respondents to submit offers by July 26.

GSA's procurement records showed that 16 companies
inquired about the solicitation. This included six
companies in Anchorage that the contracting
officer had contacted directly to help ensure
competition. Three of the 16 companies submitted
offers by July 26. One of these companies, NANA,
had the lowest price in its offer but GSA did not
initially consider it because the company was not
a small business, as defined by the Small Business
Administration (SBA), and GSA had advertised the
contract as a small business set-aside.

On July 27, the GSA contracting officer and an FPS
official in Anchorage contacted the two remaining
solicitation respondents-McKinley and another
company based in Florida-to ensure that each
company understood all of the contract
requirements. According to the contracting
officer, it was at this time that she learned that
neither company had a security agency license
issued by the state of Alaska. The state required
such companies to be licensed, and the GSA
solicitation required that offerers meet all state
requirements. The contracting officer told us that
she requested both companies to provide evidence
of the required state license by July 29, 1999.

Further, she said that she also learned at that
time that McKinley, whose bid was the lower of the
two remaining competitors, had not included the
cost of fringe benefits for the contract guards in
its offer. She said that she told McKinley
representatives that under the law, their bid
could not be revised to include the costs of
providing the fringe benefits. She said that
McKinley representatives responded that they could
not pay for the fringe benefits on the basis of
the price represented in their offer, and they
would have to withdraw from competition.

The contracting officer also said that McKinley
representatives told her that because the company
had only recently been formed, it did not have
guard uniforms with company insignia available
should they be awarded the contract, and they
would have difficulty obtaining the uniforms in
the 5 days left before the contract was to take
effect. She said that McKinley wanted GSA to allow
the guards to wear uniforms with the insignia of
ISI, their former employer.

On July 29, 1999, the contracting officer received
letters from both companies withdrawing their
respective offers. Then, following the provisions
of FAR 19.506, she sent a letter to SBA in
Anchorage requesting that the small business set-
aside designation for this procurement be
dissolved because the only remaining offerer was
not a small business. Her letter stated that this
action was necessary due to the time constraints
involved and the potential detrimental impact to
the public interest if security services lapsed on
August 1 at several federal facilities in Alaska.
SBA concurred in this request.

With the two small businesses having withdrawn and
with the small business set-aside dissolved, the
contracting officer determined that the offer by
NANA was acceptable. After considering such
factors as the company's financial resources,
business ethics, and past performance, she
determined that NANA was "responsible." The
contracting officer's Price Negotiation
Memorandum, required by the FAR and dated July 30,
1999, stated that with receipt of the three offers
in response to the solicitation, there had been
competition and that NANA's offer, with the lowest
total price of the three offers received, was fair
and reasonable. The memorandum further stated that
it was in the government's best interest to award
the interim contract to NANA, which GSA did on
July 30.

Representatives of McKinley told us that they
believe that GSA officials were biased against the
company because two part-owners had participated
in the strike against ISI. They told us that they
believe that GSA used the facts that McKinley did
not have a state license as a security services
company and would have difficulty in obtaining
appropriate guard uniforms by the contract's
effective date as excuses for not selecting
McKinley for the interim contract. They said that
they told GSA at the contract preaward meeting
that they believed they could either obtain a
license from the state by the contract effective
date or obtain a short-term waiver from the state
until a license could be issued. They also said
that they believed that GSA could have provided
them a waiver for the short time period that it
would have taken for them to obtain the proper
guard uniforms. In addition, they told us that GSA
treated the company unfairly in requiring it to
pay fringe benefits. They also said that the
company would have been severely handicapped in
carrying out its responsibilities because the GSA
contracting officer's representative was strongly
biased against it.

We did not find evidence of any bias on the part
of GSA in the award of the interim contract.
Although we do not know the personal views of GSA
officials toward McKinley, the contracting officer
consistently applied the provisions of the
solicitation. Specifically, GSA discussed the
requirement for a state license with both McKinley
and one other competitor and required both
companies to provide evidence of compliance. Both
companies subsequently withdrew. The assertion by
McKinley that GSA treated McKinley unfairly by
requiring it to pay the cost of the guards' fringe
benefits is unfounded. GSA's solicitation required
that offerors include an amount for guard wages
and benefits that was at least equal to the amount
included in the DOL wage determination cited in
the solicitation. According to the contracting
officer, the offer that NANA made to GSA included
such an amount in its price.

The Longer Term Contract
On August 5, 1999, GSA awarded a contract to
American Guard for security guard services for an
initial 1-year period to begin on October 1, 1999,
with four successive option periods of 1 year
each. McKinley, which also sought the contract,
alleged irregularity in GSA's award of the
contract to American Guard. McKinley had
determined that American Guard had used an
employment screening form that included the ISI
name on the form. McKinley representatives told us
that they believed that this was an indication
that American Guard and the former contractor,
ISI, were in fact the same company. They told us
that they believed that GSA had preselected
American Guard for this contract because American
Guard was simply an extension of ISI. However, we
found no evidence that GSA acted inappropriately
in awarding the contract to American Guard.

GSA posted the solicitation for the longer term
contract on the Commerce Business Daily Internet
site on June 7, 1999, which allowed a 19-day
period for respondents to submit offers by the
June 25, 1999, solicitation closing date. GSA
received eight responses to the solicitation,
which were evaluated jointly by the contracting
specialist and an FPS official in Auburn against
specific criteria or factors described in the
solicitation. Two respondents were eliminated
because they failed to meet the criteria for
experience and/or past performance.

In addition, McKinley was eliminated because its
offer did not meet a key requirement of the
solicitation. Specifically, McKinley was
eliminated because its offer did not contain the
"Technical Proposal" required by the solicitation.
The Technical Proposal was to provide, among other
things, the following:

ï¿½    demonstrated company experience performing
similar services within the past 5 years, with a
minimum of 3 years of consecutive experience;
ï¿½    information on the quality, feasibility, and
extent of the company's capabilities to manage the
contract, including resumes of key personnel
designated to oversee the day-to-day operations of
the business; and
ï¿½    a staffing plan.

The contracting officer told us that her decision
to eliminate McKinley from the competition was
supported by applicable procurement procedures. In
this regard, contracting officers may allow
offerors to clarify information or correct minor
or clerical errors in their offers, but an offeror
is not allowed to provide additional information
needed to make the offer complete after the
solicitation closing date.

GSA evaluated the remaining five offers. American
Guard's offer contained the lowest price-its
proposed hourly pay rates, including overhead,
were below all competitors' prices and GSA's
estimate. Also, the contracting officer determined
that American Guard had adequate financial
resources, a satisfactory performance record,
integrity and business ethics, and the necessary
experience and organizational skills to be
considered eligible to be awarded the contract.

McKinley has alleged that American Guard and the
previous contractor, ISI, were in fact the same
company. McKinley's primary support for this
contention was that an employment screening form
used by American Guard contained the ISI name on
it. According to the contracting officer, she
brought this matter to the attention of American
Guard's Vice President, who responded by
apologizing for the error. He explained that as a
former employee of ISI now employed by American
Guard, he had kept some of ISI's electronic
employment screening forms. He said that one of
these forms had inadvertently been used by
American Guard, which was formed in 1997. The
contracting officer said that she verified from
the Vice President's resume that he had previously
worked for ISI, accepted his explanation as
reasonable, and did not pursue the matter further.

In our view, GSA reasonably inquired into American
Guard's inadvertent use of ISI's screening form,
and McKinley has provided no other evidence
suggesting that American Guard was controlled by
ISI. Even if such a relationship existed, we found
no evidence that GSA had preselected American
Guard for award of the contract.

Appropriate Wage Determinations Not Always Used
GSA did not use the appropriate DOL wage
determination on two of the contracts awarded for
security guard services at AFOB since 1996. On the
1996 contract, GSA used an outdated wage
determination for the initial year of the
contract. But the mistake did not cost GSA money
or harm the guards because the guards' wage rate
was the same for both wage determinations-the then-
current wage determination and the outdated wage
determination that GSA used.4

On the August 1, 1999, interim contract, GSA
appears to have used the appropriate wage
determination. However, GSA appears to have
inadvertently used an outdated wage determination
on the following longer term contract. That
contract provides an hourly wage rate to the
guards of $11.09 per hour, while the most current
wage determination provides for an hourly wage
rate of $12.62 per hour.

DOL Wage Determinations
Federal contracts for services, such as security
guard services, are subject to the provisions of
the Service Contract Act of 1965, as amended (41
U.S.C. 351-358); as well as to applicable
provisions of the Fair Labor Standards Act of
1938, as amended (29 U.S.C. 201-219); and to the
Secretary of Labor's regulations and instructions
provided in 29 C.F.R. Parts 4,6, 8, and 1925. FAR,
Subpart 22.10, specifically prescribes the
policies and procedures for implementing the
applicable provisions of these laws and
regulations as well as the instructions of the
Secretary of Labor.

The FAR specifies that among other things, service
contractors are to pay the employees performing
the services "at least" the hourly rates for wages
and fringe benefits, such as health and life
insurance and retirement contributions, that DOL
has determined to prevail in the locality where
the services are provided. Where there is no
collective bargaining agreement between the
contractor and its unionized employees that
provides for wages and fringe benefits that are
higher than the DOL wage and fringe benefits
determination, the FAR requires government
contracting officers to obtain from DOL and use
the current wage and benefits determination for
all solicitations, contracts, and contract options
for $2,500 or more when service-type employees are
to be used.

To obtain a current wage and fringe benefits
determination, the FAR requires government agency
contracting officers to notify DOL at least 60
days prior to each new services contract
solicitation or exercise of an option to renew or
modify a services contract. The notice to DOL is
to use the exact job titles and codes for the
service jobs to be included in the contract as
shown in DOL's Service Contract Act Directory of
Occupations. The directory contains commonly used
job titles and descriptions of the duties
performed by various classes of service employees
employed by the government. Upon notification, DOL
is to issue to the contracting agency a current
wage and benefits determination. DOL is to develop
wage determinations on the basis of available data
showing wage and benefit rates for specific skills
that prevail in specific areas of the country. The
FAR requires the contracting agency to incorporate
the current wage and benefits determination in the
contract solicitation for which it was requested.

Competitors for federal contracts are then to use
the wage and benefits determination in their
contract proposals or offers submitted to the
contracting agency. Also, the contractor selected
for the contract is to pay its employees
performing the services under the contract at
least the wage and benefits hourly rates specified
in the agency's solicitation. For contracts with
successive option years, contracting agencies are
to ask DOL to update the wage determination each
year, and the contractor is to adjust the wages
and benefit rates accordingly.

GSA Region 10 Wage Determination Procedures
Since July 1989, GSA Region 10 has used what is
referred to as a "blanket wage determination" for
determining the appropriate wages and benefits to
be paid on the Region's service contracts. To
reduce the administrative burden and costs for
both GSA and DOL of complying with FAR wage
determination requirements, a Memorandum of
Understanding (MOU) between GSA Headquarters and
DOL established a process for GSA to use annual
blanket wage determinations.

Under the blanket wage determination process,
Region 10 is to annually develop a comprehensive
procurement plan showing the service contracts
that will be awarded for each specific geographic
area in the Region, such as Alaska in Region 10.
Then, the Region is to submit to DOL a single
notice showing its planned service contracts for
each specific area. DOL is to respond to the
notice by issuing an "area wide" blanket wage
determination that shows the current wage rate and
benefits that apply to each job to be included in
GSA's service contracts in each geographic area.
GSA then is to use the blanket wage determination
in all solicitations for service contracts in that
geographic area. The blanket wage determination is
to be in effect for generally about 12 months,
after which DOL is to notify GSA that it is time
to request a new, updated blanket wage
determination from DOL. Hourly rates for fringe
benefits are also provided in the blanket wage
determination and are also generally updated every
12-months. However, DOL may update fringe benefit
rates at other times and is to notify GSA of the
new rates when this occurs.

GSA Region 10 Application of Wage Determinations
Our review of GSA's use of DOL wage determinations
for each contract and option year exercised showed
that GSA submitted the required notices to DOL
requesting the blanket wage determination for
security guard service jobs in Alaska each year
when prompted by DOL to do so. Each notice
included the required information, such as the
correct DOL occupation classification code and
position description. Further, we determined that
GSA's actions in awarding these contracts were
consistent with the blanket wage determination
process covered under GSA's MOU with DOL, with two
exceptions.

The contract security guards at AFOB had
complained to GSA, DOL, and others for several
years that they were underpaid because GSA was
using outdated and inappropriate DOL wage
determinations. The guards' concern stemmed from
what they believed was their relatively low wage
rate of $11.09, which had remained unchanged
during the 3-year period of the ISI contract. In
comparison, the hourly wage rate paid to court
security officers working under contract to the U.
S. Marshalls Service and who also worked at AFOB
had almost doubled over the same period of time.
However, DOL informed the guards in March 1999
that the disparity between their wages and those
of the court security officers was caused by the
fact that guards and court security officers are
separate and distinct job classifications, each
having different job descriptions. Further, we
found that GSA used the appropriate DOL wage
determination in accordance with the MOU for each
contract and option period except for the initial
year of the 1996 contract, when the contracting
officer used an outdated blanket wage
determination; and for the most recent contract in
1999 when, apparently partly on the basis of
incorrect advice she received from a DOL official,
the contracting officer inadvertently did not use
the more current DOL revision to the wage
determination. According to DOL, GSA should have
used the revised wage determination in accordance
with the MOU and 29 C.F.R. 4.5.

GSA used an outdated blanket wage determination on
the initial contract with ISI in June 1996. The
blanket wage determination that GSA used had been
recently superceded by a new blanket wage
determination. There was no resulting monetary
loss to GSA or the guards because both the wage
and benefit rates, $11.09 per hour and $0.90 per
hour, respectively, were the same under both
blanket wage determinations. The GSA contracting
officer responsible was no longer with GSA.
However, a Region 10 official told us that this
contracting officer probably did not want to spend
additional time revising the contract solicitation
to reflect the updated wage determination because
there was no effect on GSA or the guards from
using the superceded blanket wage determination
for that solicitation.

On the interim contract, the responsible GSA
contracting officer in Anchorage said that she was
not aware of the MOU between GSA and DOL;
therefore, she obtained and used the most current
DOL wage determination. GSA initially believed
that the contracting officer's use of the most
current wage determination instead of the blanket
wage determination was inadvertent. However, it
appears that the wage determination used on the
interim contract was correct. The wage and fringe
benefits rates were $12.62 and $1.63 per hour,
respectively, under the current wage determination
and $11.09 and $1.63 per hour, respectively, under
the blanket wage determination.

For the longer term contract effective October 1,
1999, GSA reverted back to the blanket wage
determination, and the guards' wage rate reverted
back to $11.09 per hour. Prior to the solicitation
of the longer term contract and because the guards
had raised the issue that DOL had recently issued
a revised wage determination, GSA asked DOL to
confirm that the blanket wage determination it
planned to use in the solicitation was the
appropriate wage determination. In response, a
supervisor in DOL's Wage and Hour Division,
Employment Standards Administration, replied in a
letter to GSA that the blanket wage determination
specified was the appropriate wage determination
to use.

However, after learning of this issue from our
draft report, DOL's Director of the Office of Wage
Determination, Wage and Hour Division, Employment
Standards Administration, told us that GSA should
have used the revised (more recent) wage
determination with the higher wage rate for the
longer term contract. He said that a DOL
supervisor had apparently erred in advising GSA to
use the wage rate specified in the blanket wage
determination for the longer term contract. He
said that because GSA had learned of the revised,
more current DOL wage determination prior to the
solicitation of the interim contract, GSA was
obligated to use the most current wage
determination in accordance with the MOU and 29
C.F.R. 4.5 on both the interim contract and the
longer term contract. He said that the blanket
wage determination program was never intended to
give contracting agencies the authority to
knowingly use outdated wage determinations.
Further, he acknowledged that on the basis of the
confusion that appears to exist at GSA, other
federal agencies using the blanket wage
determination program may also be unaware of DOL's
position on how wage determination revisions
affect the blanket wage determination program. He
said that about 15 federal agencies are
participating in the blanket wage determination
program.

In response to DOL's comments, GSA pointed out
that it did what the DOL supervisory official
indicated it should do on the longer term
contract. It said further that in its review of
DOL's comments with GSA legal counsel, questions
had arisen about the incorporation of
modifications to wage determinations into the
contract. GSA said that it was looking into the
impact on the use of blanket wage determinations
and how region 10 should approach these issues in
the future. Thus, it is not yet clear whether GSA
and DOL agree on this issue.

This situation raises the question of whether the
guards are entitled to higher wages for the entire
period covered by the contract. It also raises the
question as to whether other federal agencies are
appropriately using DOL wage determination
revisions in locations where blanket wage
determinations are in use.

GSA Response to Guard Contract Compliance
Allegations
The guards have alleged that GSA did not take
appropriate action to enforce the contract with
ISI, even after they told GSA on numerous
occasions that ISI was not complying with certain
important provisions of the contract. Our review
of these allegations did not begin until after
GSA's contract with ISI had ended. Further, little
documentary evidence of GSA's actions to address
the guards' allegations was available. However,
the documentation we were able to obtain and oral
statements from the guards and GSA officials lead
us to believe that GSA could have done more to
ensure and document ISI's compliance with the
important contract requirements that were of
specific concern to the guards.

The FAR directs contracting officers and
contracting agencies to ensure that services
provided by contractors meet contract
requirements. We found little evidence that GSA
initiated or documented appropriate action to
investigate repeated allegations made by the
guards that important contractual requirements
were not being met or to see that GSA was
receiving all that it was paying for.

Contracting Officers' Responsibility to Enforce
Contracts
The FAR places important responsibilities on
contracting officers and their representatives to
ensure that the interests of the government and
the taxpayer are safeguarded. FAR Subpart 1.602-2
states that among the responsibilities of
contracting officers is the obligation to ensure
compliance with the terms of the contract and, if
necessary, to request and consider the advice of
specialists in audit, law, engineering,
transportation, and other fields as appropriate.

Contracting officer representatives who usually
have technical expertise in areas specifically
related to the functional area for which the
contract has been awarded, such as security
services, are to ensure that the contractor's
efforts comply with the technical features of the
work required by the contract. This includes the
responsibility to inspect and evaluate work
performed under the contract, assist the
contractor in interpreting the technical
requirements of the contract, and advise the
contracting officer as difficulties or situations
arise that may disrupt or hinder performance of
the contract.

Guards' Allegations
Several guards, including the president of the
guards' union local, told us that beginning in mid-
1997 they began complaining to ISI, the GSA
contracting officer's representative in Anchorage,
and subsequently to both GSA contracting and FPS
officials in Auburn about ISI's failure to comply
with certain contract requirements that could
materially affect contract performance. The guards
alleged that ISI provided (1) poor quality or
nonexistent guard training in important areas,
such as in the operation of metal detection
equipment and in the detection and recognition of
explosive devices; (2) substandard firearms; (3)
less ammunition than required; and (4)
insufficient foul weather gear, such as cold
weather parkas and ear protection. They said that
they almost always received either no response or
an inadequate response from ISI; and GSA
representatives almost always responded that these
matters were between the guards and the
contractor, not GSA. The guards' complaints
implied that ISI was not meeting important
contractual responsibilities.

The guards told us that the training they received
from ISI, as well as the required qualifications
testing, was inadequate and, on at least one
occasion, test results were falsified. According
to the president of the guards' union local, some
of the guards were hired and posted to duty
without receiving the required training, such as
in the use of x-ray and metal detection equipment,
even though the ability to use this equipment is
set forth in the guards' job descriptions and in
the GSA contract.

In addition, the union local president and a guard
told us that a guard was hired and assigned to his
post before he successfully completed the firing
range qualification test required by the contract.
They said that ISI falsified the record to show
that the guard had successfully completed the
firing range test. The GSA contract with ISI, at
Part 13, states that each uniformed guard must
qualify with his/her duty weapon before assignment
to duty and annually thereafter. Also, it states
that the contractor must submit written records of
these qualification tests to the contracting
officer's representative.

Further, several guards told us that sometimes the
firearms issued to the guards were substandard and
unreliable and often failed on the practice firing
range. They said that as a result, many of the
guards carried their personal weapons while on
duty and used them to weapons-qualify on the
firing range. They said that to get around the GSA
contract restriction against using their personal
weapons, they leased their weapons to ISI for $1
per year. This practice, in effect, shifted the
costs of providing qualified weapons from ISI to
the guards. Part 9B (1) of the contract stated
that the contractor is to provide all necessary
equipment, including firearms, to perform all work
under the contract. Additionally, the contract
says that employees of the contractor are
prohibited from carrying personal weapons while on
duty. We believe the practice of having the guards
lease their personal weapons to ISI so that they
could carry them while on duty was an effort to
circumvent the requirement that the contractor was
responsible for providing necessary equipment,
including firearms, and the prohibition against
employees carrying their personal weapons while on
duty.

Several guards told us that ISI commonly did not
provide them with the full amount of ammunition
required by the GSA contract. For example, one of
the guards said that when he was hired, the
contractor issued him only 8 rounds of ammunition
instead of 18 rounds, which is provided by the
contract. Further, several of the guards told us
that the ammunition provided by ISI was not
regularly inspected or replaced each year as
required by the contract. Several of the guards
said that as a result, it was common practice
among the guards to provide their own ammunition.
Part 9B 1(e) of the contract provided that guards
and supervisors on duty are to carry 18 rounds of
factory-load hollow point ammunition for revolvers
or 3 fully loaded factory-issued magazines for
semiautomatic weapons, ammunition is to be
provided by the contractor and inspected daily to
ensure that it is safe and effective for use, and
the contractor is to issue new ammunition
annually.

Finally, the guards told us that ISI and GSA
failed to respond to their repeated requests for
foul weather gear suitable for the extreme
temperatures and weather conditions that occur in
Alaska. They said that they specifically pressed
for parkas suited to performing their outdoor
duties during the winter months. They said that
eventually ISI provided six one-size-fits-all
military surplus parkas that were not suitable for
extreme conditions and that were to be left on
site and shared by all the guards when they
performed their outdoor duties. Several guards
said that to stay warm, many guards wore their
personal parkas while performing outside duties.
Further, an FPS official in Anchorage told us that
because he felt sorry for the guards, he
occasionally loaned the guards his personal heavy-
duty coat.

The GSA contract with ISI specified that the
contractor is to issue each guard a quantity of
uniforms and other items that ensures that the
guards are in proper uniform while on post. The
contract listed the other items, such as "a parka
and winter hat with ear flaps" for rover and
exterior posts.

The president of the guards' union local told us
that he and other members of the guard workforce
reported each of the concerns enumerated above to
GSA's contracting officer's representative on
numerous occasions. He said that the response that
they usually received was that there was nothing
that the contracting officer's representative or
GSA could do because the issues were between the
guards and ISI, and complaints should be brought
to ISI. The president of the union local said that
he also reported these problems to other GSA
officials in both Anchorage and in GSA
headquarters in Auburn. He said that he received
either no response or a response that he should
take the problems up with ISI.

GSA's Response
We discussed the guards' allegations with an FPS
officer in Anchorage who was also the contracting
officer's representative throughout most of the
ISI contract period. He said that he could not
remember discussing all of these allegations with
any of the guards or the president of the guards'
union local, but he acknowledged frequently
receiving complaints from the guards about
numerous problems they were having with ISI. He
said that he sometimes responded to the guards
that the problems were between them and ISI and
that neither he nor GSA could get involved.
However, he also said that on other occasions, he
contacted ISI and asked that the problem be taken
care of. He said that he believed that ISI usually
took care of the problem. He said that he almost
always informed the contracting officer and/or FPS
officials in Auburn of the guards' complaints. He
said that he rarely documented either the guards'
complaints or the action he took in response to
the complaints.

On the specific issue raised by the guards of
substandard weapons, the contracting officer's
representative told us that when a guard
complained to him about a weapon misfiring or
otherwise malfunctioning on the firing range, he
brought the matter to the attention of ISI. He
said that ISI usually responded that it would
remove the weapon from its inventory. However, he
said that he did not verify that ISI had removed
any weapons from inventory, and he did not inspect
the weapons carried by the guards to determine
their suitability because he was not a weapons
expert. Further, he said that he was aware that
some of the guards had leased their personal
weapons to ISI so that they could carry them while
on duty. He said that he assumed that this
practice was not prohibited by the GSA contract
with ISI.

Specifically regarding the guards' allegation that
ISI had falsified records relating to one of the
guard's range qualifications test, the contracting
officer's representative said that he reported the
matter to an FPS criminal investigator in
Anchorage. He said he did not know if there was an
investigation by FPS or the result of any
investigation that might have been made.

We then contacted that FPS investigator, who said
that he discussed the alleged incident with ISI
and was told that after its investigation ISI had
fired the individual responsible for falsifying
the record. However, he said that he did not have
the time to verify that ISI had in fact
investigated the matter and fired the individual
responsible. Further, he said that he did not
communicate the results of his investigation to
the guard involved or to the union.

We contacted several contracting officials and FPS
representatives in Auburn to discuss their
knowledge of and response to the guards'
allegations. They said that they were aware of
some, but not all, of the allegations. They said
that they believed that all allegations involving
contract compliance by ISI were being addressed by
the contracting officer's representative in
Anchorage.

However, the president of the guards' union local
provided us with a letter, dated September 18,
1998, that he wrote to the GSA contracting
officer's representative. The letter stated that
after two Capitol police officers had been killed
in Washington, D. C., it was important to bring to
GSA's attention dangerous flaws in its security
program that put federal employees and visitors to
federal buildings in Alaska in great peril. The
letter itemized 16 guard concerns about safety in
and around AFOB, including contract compliance
issues, such as the lack of an established guard
training program; obsolete and substandard weapons
issued to the guards; insufficient guard weapons
training; no weapon qualifications by some guards;
insufficient foul weather gear for the guards; and
substandard electronic communications among the
guards while on duty.

The last item mentioned in the letter was that
there was a serious morale problem among the
guards because of the appearance that FPS and GSA
did not care what happened to them. The letter
closed by stating that the guards stood ready to
discuss the problems outlined in the letter and
ready and willing to assist GSA in correcting
these serious safety issues. The union local
president told us that he sent copies of the
letter to other GSA representatives both in
Anchorage and in Auburn, including the contract
specialist in Auburn with responsibility for
handling the ISI contract.

The president of the union local also provided us
with a response, dated September 29, 1998, to his
letter that he received from an FPS official in
Auburn. It stated "This response provides you and
your union members with the information you need
to direct your concerns to the proper
organization." It further stated that because
GSA's contract with ISI did not involve a
collective bargaining agreement between the
contractor and the union, the issues raised by the
union should be addressed to ISI. The letter also
stated that GSA's security program, including the
one in Alaska, reflected the requirements of the
Department of Justice Vulnerability Assessment of
Federal Facilities, as well as the recommendations
of each facility's building security committee.
The letter closed by showing an address where
correspondence to ISI could be sent. According to
the president of the union local, this letter from
GSA/FPS was typical of the responses received from
GSA about these issues.

We believe that the guards' allegations related to
ISI contract compliance issues merited more
formal, systematic follow-up by GSA. In its
recently completed audit of GSA's nationwide
contract guard program, which did not include
Region 10, the GSA OIG found both poor contract
enforcement by GSA and contractor compliance
issues similar to those raised by the guards in
Anchorage. In addition, an internal audit of the
region's contract guard program by Region 10 FPS
officials conducted after learning of the results
of the OIG audit found both contractor compliance
and contract enforcement problems similar to those
raised by the guards during the ISI contract.

The primary objective of the OIG audit-determining
if GSA was optimally managing its contract guard
program-was much broader than our objective of
determining whether GSA appropriately responded to
guard allegations that ISI was not complying with
important provisions of the contract. However,
several contractor oversight concerns identified
by OIG at the locations it visited were very
similar to concerns alleged by the guards at AFOB.
Specifically, OIG found that contract guards were
on duty without (1) the required training from the
contractor to perform their duties, including
training in the use of x-ray scanners and
magnetometers; and (2) valid firearm
qualifications. OIG concluded that GSA was not
consistently enforcing and overseeing program
contracts.

After hearing about what OIG found in its audit in
other GSA Regions, in December 1999 Region 10 FPS
officials reviewed the Region's contract guard
program. Among other things, they found that (1)
regionwide, guard training records were not being
maintained, and the contracting officer
representatives were not tracking the required
guard training; (2) the contracting officer
representatives were not determining the
continuing qualifications of the guards to perform
their duties; and (3) on the Alaska contract
specifically, 3 of 12 guard weapons inspected were
found "not acceptable" because they were either
not clean or not in proper working order. Further,
they stated that there needs to be an ongoing
dialogue between contracting officers and their
representatives to ensure that problems are
resolved before they become so severe that they
cause contract compliance problems. The FPS
officials said that this includes keeping
contracting officers informed of noncompliance
issues or any guard problems within the scope of
the contract.

According to GSA's OIG, the contract oversight and
enforcement problems it found were the result of
GSA's regional offices operating autonomously with
limited controls and oversight by FPS headquarters
and of GSA's lack of a comprehensive plan for
accomplishing the contract guard program mission.
OIG made several recommendations to GSA directed
at eliminating the causes of the problems it
found. Similarly, these causes could have been
factors that influenced GSA's lack of sufficient
follow-up of the contract guards' allegations in
Anchorage.

GSA's Response to Guards' Unfair Treatment
Allegations
In addition to their complaints about ISI's
contract performance deficiencies, the guards
complained even more vociferously and more often
about what the guards referred to as ISI's unfair
labor practices. These practices primarily
entailed alleged discrepancies in ISI's
administration of the guards' pay and benefits,
but they also included issues related to ISI's
alleged failure to bargain in good faith with the
union. The guards also alleged that GSA did not
take appropriate action to respond to their
repeated pleas to help resolve these issues. The
issues were not resolved to the guards'
satisfaction, and eventually they went on strike
against ISI. The strike cost GSA an undetermined
amount of money to mitigate the potentially
increased risk to security at several federal
facilities in Alaska. Subsequent to the strike,
ISI was charged with several violations of the
National Labor Relations Act. ISI contested the
charges, and NLRB had not taken final action at
the time this report was issued.

We believe that as the contracting agency, GSA had
a responsibility to avail the guards and ISI of
appropriate federal or other resources to help
resolve their disputes so that the delivery of the
services contracted for, namely security guard
services, were not adversely affected. The FAR
requires agencies to take steps to ensure that
parties in a labor dispute involving a government
contract use available resources for resolving the
dispute, including those available through other
federal agencies and appropriate state, local, and
private agencies. Given this FAR requirement and
the importance of continual contractor performance
under a security services contract, it would have
been prudent of GSA to have arranged for the
involvement of appropriate agencies to help
resolve the disputes between the guards and ISI.

However, GSA did not attempt to bring other
agencies or organizations into the dispute. The
guards eventually asked NLRB to investigate, but
the guards struck before the NLRB investigation
was complete. The strike cost GSA an undetermined
amount of money and could have affected security
at AFOB and other federal facilities in Alaska.
Had GSA brought appropriate agencies, such as DOL
and NLRB, into the conflict early, the strike and
its monetary effects on both GSA and the guards
and its potential effect on the safety of federal
employees and protection of federal facilities
might have been averted.

FAR and GSA Regulations
FAR Subpart 22.1 requires federal agencies to
remain impartial concerning disputes between a
government contractor and its employees. Agencies
are specifically precluded from undertaking a role
in conciliation, mediation, or arbitration in such
disputes. However, the FAR states that to the
extent practicable agencies should ensure that the
parties to the dispute use all available methods
for resolving the dispute, including the services
of NLRB; the Federal Mediation and Conciliation
Service; the National Mediation Board; and other
federal, state, local, or private agencies, as
appropriate.

The FAR states that federal agencies should, to
the extent consistent with their acquisition
responsibilities,

ï¿½    notify the agency responsible for
conciliation, mediation, arbitration, or other
related action of the existence of any labor
dispute affecting or threatening to affect agency
acquisition programs;
ï¿½    furnish the disputing parties factual
information pertinent to the dispute's potential
adverse impact on the acquisition; and
ï¿½    seek a voluntary agreement between management
and labor, notwithstanding the continuance of the
dispute, to permit uninterrupted acquisition of
the services being acquired.

Further, the FAR requires contracting officers to
report, in accordance with each agency's
procedures, any potential or actual labor disputes
that may interfere with the performance of
contracts under their cognizance.

GSA's internal regulations, Subpart 522.1, Basic
Labor Policies, state that contracting officers
are to report labor disputes that potentially may
adversely affect contracts to GSA's Labor Advisor
in headquarters who, in conjunction with GSA's
Office of General Counsel, is to (1) serve as the
focal point on matters that relate to
contractor/labor relations; (2) initiate contact
about these matters with national offices of labor
organizations, government departments, agencies,
or organizations; and (3) respond to questions
involving these matters that arise in connection
with GSA acquisitions.

Guard Complaints about Pay and Benefits
According to the guards, virtually from the
beginning of the ISI contract, they had problems
with ISI's determination and administration of
their regular and overtime pay and fringe
benefits. In addition, the guards have alleged
that after they unionized, ISI refused to
recognize and bargain in good faith with the
union.

Regular and overtime pay
According to the union local president, ISI
repeatedly shorted the guards' pay for the hours
they worked and used a method of accounting for
their work hours that was confusing. He said that
ISI repeatedly refused the guards' request to
clarify the computation of their pay. In addition,
he said that some of the guards' holiday pay was
shorted repeatedly because ISI did not always pay
the guards a full 8 hours for holidays even though
GSA's contract specified that all full-time guards
be paid for holidays.

Further, he said that in late 1997 ISI reduced the
guards' pay rate from $11.09 per hour to $9.09 per
hour. Although their total hourly pay was not
affected, ISI reflected on the guards' pay records
that they received an additional $1 per hour
uniform allowance and a $1 per hour gasoline
allowance. However, the guards did not incur
gasoline cost as part of their duties, and GSA's
contract specified that the guards were to be
provided uniforms at ISI's expense. Although the
guards' total compensation still equaled the
appropriate DOL wage determination hourly rate of
$11.09 per hour, the union local president said
the guards were concerned because their earnings
were being underreported to the Internal Revenue
Service, and the underreporting could adversely
affect their Social Security, unemployment
insurance, and workman's compensation
entitlements. According to the union local
president, after a series of complaints by the
guards to the contracting officers'
representative, ISI discontinued this practice.

In addition, ISI incorrectly calculated the
guards' overtime hours by using federal standards
instead of state of Alaska standards, which
applied to federal contracts at GSA-managed
facilities in Alaska. The GSA contract required
that overtime be paid for all hours over 40 per
week. On the other hand, state of Alaska law
requires that overtime be paid for hours worked
exceeding 8 hours per day.

In March 1997 the Alaska State Department of Labor
wrote to ISI, informing it that GSA was in
agreement with the state that Alaska law prevailed
over federal law in this matter. However, ISI
continued to calculate overtime hours in
accordance with the GSA contract requirement. In
about October 1998, the guards began complaining
to ISI and GSA about the overtime issue. GSA
incorrectly advised ISI that Alaska law was not
applicable to federal contracts. Subsequently,
after enforcement efforts by the state, the guards
received about $50,000 in back overtime pay from
ISI. GSA reimbursed ISI for these payments
because, according to GSA, ISI had calculated
overtime hours in accordance with the method
specified in the GSA contract. The contracting
officer stated that she was not aware that ISI had
received such a notice from the state or that GSA
had agreed that state law prevailed some 2 years
before ISI began determining overtime hours worked
in accordance with Alaska state law.

We believe that GSA contracting officials should
have been aware of the state's overtime provisions
when the contract for guard services in Alaska was
solicited and should have included a clause in the
contract specifying that any overtime paid under
the contract was to be calculated using state of
Alaska overtime provisions.

Moreover, we believe that when the guards
complained to GSA that ISI was not determining
overtime hours in accordance with Alaska state
law, GSA should have determined the applicability
of state law to the contract and amended the
contract accordingly. If the contract with ISI had
provided for overtime to be determined in
accordance with state law, ISI may not have
structured the guards' work schedules to routinely
include more than an 8-hour day. Thus, the
overtime in question would not have been earned by
the guards, paid by ISI, and reimbursed by GSA.

However, it is uncertain how the price in ISI's
offer in response to GSA's contract solicitation
in 1996 would have been affected had ISI known
that it would have had to pay the guards overtime
for hours worked in excess of 8 per day. ISI's
total contract price offer may have been more than
the additional $50,000 that GSA reimbursed ISI for
the cost of the overtime. We noted that the
subsequent contracts awarded to NANA and American
Guard by GSA specified that Alaska state law
overtime provisions were applicable to the
determination of any overtime hours.

Fringe benefits
Under the contract, GSA periodically reimbursed
ISI at contracted rates for the authorized hours
worked by the guards. The contracted hourly rate
included amounts for both wages and fringe
benefits as specified in the applicable DOL Wage
Determination. With respect to benefits, ISI was
to use benefit monies received from GSA to provide
the guards, at a minimum, the bona fide benefits
obtainable from the monies received from GSA. For
example, during 1998, when the wage determination
benefit rate was $1.39 per hour, ISI's
reimbursement from GSA to provide fringe benefits
to each full-time guard would have been about $240
per month. Any portion of this money not used by
ISI to provide benefits was to be added to the pay
of individual guards.

However, according to the union local president,
ISI mismanaged and poorly accounted for GSA's
payments for fringe benefits, and the benefits
provided by ISI were substandard. He said that ISI
repeatedly told the guards that their applications
for participation in the 401(k)-retirement savings
plan and health benefits plan had been lost. He
said that sometimes, ISI lost four and five
successive applications submitted by individual
guards. Further, he said that ISI could not
account for the funds that the guards had
requested ISI to invest on their behalf in the
retirement savings plan. In addition, he said that
ISI did not respond to repeated requests from the
guards and from the union for clarification of and
accounting for the benefit monies received from
GSA on the guards' behalf.

Additionally, he said ISI improperly calculated
the guards' vacation time by using a percentage of
hours worked during the year rather than by
providing 2 weeks' paid vacation each year for
guards as specified in the GSA contract. Also, he
said that the health benefits ISI provided were
substandard and cited an example where a guard
incurred a $7,000 hospital bill and the ISI-
provided health insurance paid only $500.
Similarly, he said that health care providers in
Alaska frequently would not accept the health
insurance provided by ISI.

Cooperating With the Union
The president of the guards' union local told us
that ISI repeatedly refused to deal cooperatively
with the union. He said that ISI would not
cooperate with the union in its efforts to
establish a collective bargaining agreement and
declined to provide the union with information
that was both necessary and relevant to the
union's responsibilities as the guards' exclusive
bargaining agent.

Guards' Complaints to GSA
According to the union local president, for almost
2 years leading up to the strike on April 21,
1999, the guards repeatedly communicated their
concerns about ISI verbally and in writing to
GSA's contracting officer's representative in
Anchorage and to other GSA officials. In August
1997, the security guards employed by ISI in
Alaska petitioned NLRB to certify the United
Government Security Officers of America (UGSOA) to
represent their interest in dealing collectively
with their employer. The president of the guards'
union local told us that the guards voted to
unionize because of their long-standing unresolved
disputes with ISI. In November 1997, NLRB
certified Local #46, a unit of UGSOA, as the
guards' bargaining agent. Subsequently, according
to the union local president, the union as well as
individual guards began an aggressive effort to
communicate both verbally and in writing their
concerns about ISI to GSA.

In about August 1998, the union began a series of
letters communicating their concerns to higher
level officials in GSA; other federal
organizations, such as DOL; and the President and
Vice President of the United States. The union
local president said that the responses they
received usually provided factual information and
clarified matters, such as the role of DOL wage
determinations in setting wages in federal
contracts. Also, he said GSA's responses were
almost always that the guards' concerns entailed
disputes between them and ISI and that GSA had no
responsibility to get involved. He said further
that GSA frequently stated that it had to take
this "hands-off" approach because there was no
collective bargaining agreement between the guards
and ISI. He said also that the contracting
officer's representative told him at one point
that a labor strike may be the only way to get
action on the guards' problems with ISI.

The president of the union local told us that the
union had informed GSA on numerous occasions of
the possibility of a strike if GSA did not help
resolve the problems with ISI. He said that he
informed the contracting officer's representative
in Anchorage in May 1998 that if the guards' pay
and benefits problems with ISI were not resolved
soon, the guards might strike. He said later that
in October, after getting no help from GSA, the
guards held a "strike vote" but decided to
continue negotiations with ISI. Further, he
provided us with a February 15, 1999, letter from
the union to the GSA contract specialist in Auburn
that discussed the long-standing issues involving
the guards' fringe benefits, their need for foul
weather clothing, and ISI's refusal to pay the
guards overtime in accordance with Alaska state
law. The letter virtually pleaded for GSA's help
and closed by advising the contract specialist of
the possibility of a strike "as a last resort."

In addition, a March 10, 1999, letter from the
union to the contract specialist again outlined
the union's many problems with ISI and advised
that a strike against ISI was "imminent within the
next few weeks." The letter closed as follows:

"Once again, if there is anyway we can come to an
agreement, or you can assist us, or work with us
please let me know as soon as possible. We are
always willing to listen and work together for a
successful completion. All we are asking for is
fairness and a reasonable conclusion."

The president of the union local told us that
because GSA never appropriately responded to the
guards' concerns, the guards believed that there
was a total lack of consideration of their welfare
by GSA. He said that the situation was highly
demoralizing to the guards responsible for
providing the day-to-day security at federal
facilities in Anchorage. He said that he believed
that the low morale of the guards posed a risk to
security and should have been of great concern to
GSA.

GSA's Response
The GSA contracting officer's representative in
Anchorage told us that he received numerous
allegations of improprieties in the guards' pay
and benefits from the guards for several years
leading up to the strike. He said that for the
most part, he believed that these disputes
involved contractor and employee relations and
that GSA had no authority or responsibility to get
involved. He said that he usually told the guards
to take their concerns about their pay and
benefits to DOL. He said that he never contacted
any federal or state agency about the guards'
concerns. On the other hand, he said that he had
always informed the GSA contract specialist and
FPS officials in Auburn whenever the guards
brought a problem about ISI to him.

In Auburn, we discussed with GSA's Procurement
Services Team responsible for service contracts
and the contracting officer responsible for the
ISI contract their knowledge of and response to
the guards' complaints about ISI. They
acknowledged that they were aware of some of the
complaints, but not all. They said that they had
assumed that the contracting officer's
representative in Anchorage or the contract
specialist in Auburn had taken care of the
problems that GSA could or should have dealt with.
They said that they had not reported the disputes
between ISI and the guards to GSA's Labor Advisor
in headquarters.

Although GSA did pursue with DOL whether the
appropriate wage determination was being used, GSA
did not refer complaints that the guards were not
receiving the appropriate pay and fringe benefits
under the wage determinations. FAR 22.1024 states
that the contracting officer shall promptly refer,
in writing to DOL, apparent violations and
complaints received.

The contracting officer told us that as a result
of the union's March 10, 1999, letter threatening
a strike, a conference call was held that included
her, the contract specialist, the president of
ISI, the union local president, and the union's
regional director in Seattle. She said that during
the discussion, GSA's position was reiterated that
the issues were between ISI and the guards and
that GSA could not get involved. She said that
when the call deteriorated into a "shouting match"
between ISI and the union representatives, she
recommended that the union and ISI ask NLRB to
assign a mediator to assist them in resolving the
issues between them. Finally, she said she
informed ISI of its responsibility to have
sufficient resources available to man all posts in
the event of a strike.

Effects of the Strike
Although we were unable to obtain from GSA
complete or detailed information on the effects of
the guards' strike, the strike resulted in
potentially increased security risk to federal
facilities in Anchorage for a period of time
immediately after the strike began. Also, the
strike cost GSA an undetermined amount of money.

The guards' strike against ISI was to officially
begin at 12:00 noon on April 21, 1999. However,
according to the contracting officer's
representative, several striking guards left their
posts about 15 minutes before noon. Those posts
went unmanned for a short period of time before
GSA could deploy replacement guards. In addition,
Court Security Officers temporarily manned the
post at the main entrance to AFOB after the
contract guards left to begin their strike and
before replacement guards arrived. Also, for an
undetermined period of time, ISI was unable to
find a sufficient number of qualified replacement
guards to fully staff all posts. As a result, some
posts were understaffed for a while, and FPS
personnel supplemented contract guard personnel at
other posts.

In addition, GSA sent two FPS officials from
Auburn to Alaska for about 30 days at an
undetermined cost to help respond to the strike
and ensure that security needs were met during the
period that ISI was attempting to find and hire
qualified replacement guards. According to the
contracting officer, GSA deducted money from its
payments to ISI for those occasions during the
strike when all posts were not fully staffed as
required by the contract.

NLRB Charges
According to the union local president, in January
1999 he contacted the resident officer of NLRB's
Anchorage office to discuss the guards' problems
with ISI. Shortly thereafter, NLRB began an
investigation, which culminated in NLRB bringing a
list of unfair labor charges in August 1999
against ISI. We spoke with the NLRB resident
officer in Anchorage about the charges. He said
that in his opinion the guards had a number of
legitimate complaints against ISI, and it was
unfortunate that NLRB had not gotten involved in
the dispute earlier so that a costly and
disruptive strike might have been averted. He said
that because he worked in AFOB he was aware that
the guards were embroiled in a labor dispute with
the contractor long before the union local
president contacted him in January 1999; however,
he was not asked to get involved prior to that
time.

The National Labor Relations Act violation charges
brought against ISI by NLRB included the
following:

ï¿½    In February 1999, ISI threatened the guards
that they would be replaced if they did not sign
waivers for being paid overtime when they worked 4
10-hour days.

ï¿½    In February 1999, ISI bypassed the union by
dealing directly with the guards on the overtime
and 10-hour days issue.
ï¿½    In February 1999, the union requested in
writing that ISI provide certain information
necessary for and relevant to the union's
functioning as the exclusive bargaining agent for
the guards; ISI refused to provide the
information.
ï¿½    In March 1999, ISI suspended one of the
guards because he assisted the union and engaged
in other protected, concerted, activities to
assist the union.
ï¿½    In April 1999, ISI fired the striking guards,
and the right to strike is a protected activity.
ï¿½    In May 1999, the striking guards made an
unconditional offer to return to their former
positions, but ISI refused to reinstate them.
The NLRB resident officer told us that a hearing
on these charges was held before an NLRB
administrative law judge in early 2000. A final
ruling on these charges by NLRB had not been
issued as of September 2000.

GSA Response to OIG Findings
The March 2000 GSA OIG report on the results of
its audit of GSA's contract guard program made a
number of recommendations to GSA's Assistant
Commissioner, FPS, addressing the contract
compliance and enforcement problems the OIG found.
The Assistant Commissioner concurred with OIG's
findings and recommendations; in May 2000, he
issued a memorandum to all FPS Regional Directors
specifying actions to be taken and guidelines to
be implemented in response to the OIG audit. These
actions and guidelines cover the following topics:

ï¿½    background suitability and certification
review of contract employees,
ï¿½    controls and tracking of national contract
guard examination policy,
ï¿½    x-ray and magnetometer training for contract
guards,
ï¿½    contract supervision,
ï¿½    contract compliance,
ï¿½    post orders, and
ï¿½    contract guard qualification certificates.

In addition, although GSA Region 10 was not
included in the OIG audit, Region 10 FPS officials
reviewed the contract guard program in the region
in light of OIG's findings and found that several
of the same problems existed. According to the
Region 10 FPS Director, the region has begun
taking corrective actions and implementing the FPS
Assistant Commissioner's guidelines for improving
the Region's administration of the contract guard
program.

According to regional officials, the Region has
recently taken actions to help address many of the
issues discussed in this report. These include

ï¿½    creating two contract manager positions with
responsibility for, among other things, ensuring
that the region's contract guard program meets the
agency's goals and objectives;
ï¿½    establishing a Regional Assurance Officer
position to evaluate contracting programs and
provide policy and guidance to regional
contracting staff;
ï¿½    meeting with the leadership of the guards'
union to develop a better working relationship;
and
ï¿½    meeting with a GSA security services
contractor in Seattle to discuss ongoing concerns
and issues on that contract and their impacts on
other regional security services contracts.

In addition, during the course of our review, the
region established a Law Enforcement Security
Officer position specifically for Anchorage and
has designated that person as the contracting
officer's representative for security guard
contracts.

Conclusions
During most of the period of GSA's contract with
ISI, the security guards were at odds with ISI
over what they alleged were significant
deficiencies in ISI's contract performance and
determination and administration of the guards'
pay and benefits. There were numerous pleas from
the guards for GSA's help in resolving their
disputes with ISI, but a number of the issues went
substantially unresolved through much of the
contract period. The contentious situation led to
charges by some guards, the guards' union, and a
company formed in part by two of the guards that
GSA (1) was biased and had preselected the
contractor in its award of two security guard
contracts for AFOB; (2) used inappropriate DOL
wage determinations, which resulted in
unreasonably low guard wage rates; and (3) was
unresponsive to the guards' allegations about
ISI's compliance with the GSA contract and
administration of their pay and benefits.

We found no evidence to support the charges that
GSA was biased or preselected the contractor when
awarding the contracts in question. GSA used the
appropriate DOL wage determination on the interim
contract. However, according to DOL's most recent
position, its earlier advice to GSA appears to be
incorrect, and GSA appears to have inadvertently
used the wrong wage determination for the longer
term contract for guard services in Anchorage.
According to DOL, GSA should have used the most
recent wage determination, which provided for a
higher pay rate than the blanket wage
determination GSA incorporated into the contract.
Because of DOL's position, GSA said that it has
questions about modifications to wage
determinations and how they affect the use of
blanket wage determinations. Thus, it is not yet
clear whether GSA and DOL agree on this issue. GSA
is uncertain whether its contracts for guard
services reflect the appropriate wage
determinations and whether the guards are
receiving appropriate pay. DOL is unsure whether
similar uncertainties exist at other federal
agencies.

Also, another mistake by a GSA contracting officer
could have cost GSA as much as $50,000 because the
wrong overtime provisions were used on another
contract.

 Little documentation of GSA's responses to the
guards' allegations of important ISI contract
compliance deficiencies was available. However, on
the basis of the information that was available,
we believe that GSA did not make an adequate
effort to address all the allegations and ensure
that it was getting all that it had contracted and
paid for. Further, we do not believe that GSA
responded as the FAR prescribes or in a prudent
manner to the guards' long-standing complaints
about improprieties in ISI's administration of
their pay and benefits. Although it would have
been inappropriate for GSA to interfere in a labor-
management dispute between the guards' union and
ISI, we believe that GSA did not take appropriate
action to refer the parties to an appropriate
agency(s) responsible for dealing with such
disputes, particularly given the nature of the
service involved and the importance of
uninterrupted contractor performance.

Frustrated with these long-unresolved issues and
with the perceived lack of concern by GSA, the
guards went on strike. Specific information on
what the strike cost GSA or how it affected safety
and security at federal facilities in Alaska was
unavailable. However, GSA spent money to bring
additional FPS personnel to Alaska during the
strike, and the strike resulted in potentially
increased risk to security when some posts at
federal facilities in Alaska were unstaffed or
understaffed.

GSA's OIG recently found contract oversight and
enforcement problems in GSA's administration of
its national security guard contract program
similar to those that the guards alleged at AFOB
during the ISI contract. GSA agreed with OIG's
findings and recommendations and has said that it
is taking actions nationwide that should help
prevent future contract oversight and enforcement
deficiencies like those OIG found and those that
were alleged to have occurred on the contract with
ISI. Further, Region 10 has reportedly taken
several steps to improve its efforts for meeting
its responsibility for enforcing guard services
contracts and seeing that the region's contract
guard program meets the agency's goals and
objectives.

Addressing contract enforcement and oversight
problems is a significant step in the right
direction by GSA. Further, we believe that when
fully implemented, the specific actions reported
by Region 10 may help to preclude problems in the
future with its oversight and enforcement of
security guard contracts similar to those that
appear to have occurred during its contract with
ISI in Alaska. However, the region may need to
take additional steps to make certain that
appropriate resources are brought into play to
help resolve significant issues between its
contractors and their employees when it appears
that contracted services may be interrupted or
adversely affected. This issue was not
specifically addressed in the reviews done by
GSA's OIG or Region 10's FPS.

Recommendations to the GSA Administrator and the
Secretary of Labor
We recommend that the Administrator, GSA, direct
appropriate GSA officials to ensure that

ï¿½    Region 10 contracting officers and other
appropriate personnel, such as FPS program staff
helping to administer security services contracts,
are aware of their responsibility to take the
steps necessary to bring appropriate federal or
other resources to bear to help resolve conflicts
between GSA contractors and their employees when
there are indications that interruptions or other
adverse effects on contracted services could
result;

ï¿½    the causes of the mistakes by Region 10
contracting officers, such as those that led to
the use of the wrong overtime provisions on
contracts, are determined and, if necessary,
appropriate training and supervision are provided
to help prevent these mistakes in the future;
ï¿½    an understanding is reached with DOL on how
wage determination revisions affect the blanket
wage determination program;
ï¿½    GSA contracting officers at all locations
where blanket wage determinations are used
understand how the blanket wage determination
program is affected by DOL's wage determination
revisions; and
ï¿½    GSA's contract for guard services in
Anchorage reflects the correct wage rates and that
the guards receive all the pay to which they may
be entitled for the entire contract period.
     We also recommend that the Secretary of Labor
have appropriate DOL officials advise federal
agencies of the appropriate procedures to follow
when wage rates covered by blanket wage
determinations are revised.

Agency Commments and Our Evaluation
We requested comments on a draft of this report
from the Administrator of GSA. We received written
comments from GSA's Region 10 Regional
Administrator, which stated that the comments had
been shared with and approved by GSA's central
office. The Regional Administrator stated that he
agreed with our findings and recommendations and
reiterated the actions undertaken and planned by
the region that we described in our report and
that he believes correspond to the recommendations
in our report. Appendix II contains the written
comments we received from the Regional
Administrator.

We also requested comments on a draft of this
report from the Secretary of Labor. We received
oral comments from the Director, Office of Wage
Determination, Wage and Hour Division, Employment
Standards Administration. The Director said that
the draft report's discussion of the wage rate
determinations for GSA's interim and most recent
contracts for guard services in Anchorage needed
to be revised. He said that the advice a DOL
supervisor gave to GSA on the appropriate wage
determination to use apparently was incorrect. He
said that it would appear that GSA was required to
use the more current wage determination instead of
the blanket wage determination because once GSA
became aware that the wage determination had been
revised, GSA was obligated to use the more current
wage determination for both the interim and longer
term contracts. He acknowledged that similar
confusion could exist at other agencies regarding
the appropriate handling of revisions to wage
rates where blanket wage determinations are being
used.

We revised the report to reflect DOL's comments.
In addition, we made additional recommendations in
the report to the GSA Administrator on the basis
of the new information DOL provided in its
comments. Further, as a result of DOL's comments,
we included in the report a recommendation to the
Secretary of Labor.

The GSA Assistant Regional Administer, Public
Buildings Service, Region 10, provided us oral
comments on the revised draft, including the
additional recommendations to the GSA
Administrator. He said that GSA agreed with the
report's revisions and the additional
recommendations. The Director of DOL's Office of
Wage Determination, Wage and Hour Division,
Employment Standards Administration, also provided
us oral comments on the revised draft and said
that DOL agreed with the draft report's revisions
and with our recommendation to the Secretary.
Further, he said that his office had already begun
drafting letters to be sent to federal agencies
that use blanket wage determinations clarifying
DOL's position.

We are sending copies of this report to Senator
Frank Murkowski and Senator Ted Stevens of Alaska;
Senator Thad Cochran, Chairman, and Senator Daniel
Akaka, Ranking Minority Member, Subcommittee on
International Security, Proliferation and Federal
Services, Senate Committee on Governmental
Affairs; Representative Tillie Fowler, Chairman,
and Representative James Traficant, Jr., Ranking
Democratic Member, Subcommittee on Oversight,
Investigations, and Emergency Management, House
Committee on Transportation and Infrastructure;
Senator James Jeffords, Chairman, and Senator
Edward Kennedy, Ranking Minority Member, Senate
Committee on Health, Education, Labor, and
Pensions; Representative William Goodling,
Chairman, and Representative William Clay, Ranking
Minority Member, House Committee on Education and
the Workforce; the Honorable David Barram,
Administrator of GSA; the Honorable Alexis Herman,
Secretary of Labor; and the Honorable Jacob Lew,
Director of the Office of Management and Budget.
We will make copies available to others upon
request.

If you have any questions regarding this report,
please contact me on (202) 512-8387 or Sherrill
Johnson on (214) 777-5600. Key contributors to
this assignment are acknowledged in appendix III.

Sincerely yours,

Bernard L. Ungar
Director, Physical Infrastructure

_______________________________
1See General Services Administration: Status of
Efforts to Improve Management of Building Security
Upgrade Program (GAO/T-GGD/OSI-00-19, Oct. 7,
1999).
2 For the 1996 contract, GSA used an outdated DOL
wage determination. However, there was no effect
on the wages paid the guards because the
appropriate wage rate under both the outdated DOL
wage determination and the then-current DOL wage
determination was the same-$11.09 per hour.
3General Services Administration, Office of
Inspector General, Audit of the Federal Protective
Service's Contract Guard Program, Report Number
A995175/P/2/R00010, Mar. 28, 2000.
4 A new wage determination can be issued for
reasons other than changes in wage and benefits
rates, such as to correct various types of errors
in an earlier wage determination.

Appendix I
Scope and Methodology
Page 39       GAO-01-75 Anchorage Federal Building
To evaluate the General Services Administration's
(GSA) actions in awarding the two most recent
contracts for security services in Alaska, we
identified and reviewed the applicable federal
laws, Federal Acquisition Regulations (FAR), and
governmentwide guidance for awarding service
contracts. We also identified and reviewed GSA's
implementing regulations for these laws and
guidance. We met with GSA contracting officials at
GSA's headquarters in Washington, D.C.; GSA's
Region 10 headquarters in Auburn, WA; as well as
at the Anchorage Federal Office Building (AFOB) in
Anchorage. We also reviewed the official records
of each acquisition and discussed these laws,
guidance, and GSA's implementing regulations with
the specific GSA contracting officials responsible
for the acquisitions. We reviewed each of the
solicitations to determine whether evidence of
preselection or bias on the part of GSA existed.

Further, we discussed with the GSA contracting
officials the key decisions in their evaluation of
the offers received, and we specifically examined
the rationale and legal support for decisions to
eliminate certain offers from consideration and
for determining the successful offerors. We
discussed the rationale for any deviations from
the optimum times prescribed in the FAR to
advertise GSA's intentions to procure the services
and to allow offerors to prepare and submit offers
responding to the solicitations.

To determine whether GSA used the appropriate
Department of Labor (DOL) wage determination in
the solicitations and contracts for security
services in Alaska for the three contracts awarded
and two contract options exercised during the
period 1996 through 1999, we reviewed Region 10's
contracting policies and practices for the use of
DOL wage determinations. Also, we obtained and
reviewed the Memorandum of Understanding between
GSA and DOL, which augmented guidance provided in
federal regulations and defined specific
procedures GSA's Region 10 was to use to establish
wage and benefit rates for contract security
guards. We discussed the process with Region 10
Procurement Services Team officials and members
and reviewed applicable records to verify whether
actions had been taken to update the wage
determinations each year and whether the
appropriate wage determinations were used on the
contracts we examined. We also discussed the wage
determination process with an appropriate DOL
official at DOL headquarters in Washington, D.C.

We met with the president, United Government
Security Officers of America (UGSOA) Local #46, in
Anchorage to determine the specific key
allegations of the security guards employed by
International Services, Incorporated (ISI)
concerning GSA's (1) use of DOL wage
determinations, (2) award of two contracts for
security services for GSA-managed facilities in
Alaska, and (3) responses to the guards'
allegations of unfair labor practices by ISI and
oversight of ISI's performance as measured against
the terms and provisions of the security services
contract. We discussed the union's experiences in
reporting its allegations to GSA with the union
local president. Also, we obtained additional
documentation on the allegations made by the union
from union headquarters, the Local, and GSA.
Additionally, we reviewed the extensive record of
correspondence on these allegations between and
among the individual guards and union officials,
GSA, and officials of other federal and state
agencies.

 Also, regarding GSA's oversight of ISI's
performance specifically, we reviewed the FAR and
GSA regulations pertinent to contract oversight
responsibilities by government agencies and
contracting officers. Further, we reviewed the
pertinent correspondence, including electronic
mail exchanged between and among GSA officials
addressing the guards' allegations; and we
reviewed records of pertinent meetings involving
the guards, their union, and GSA contracting
officials. We discussed these issues with the
president of the union local, GSA's contracting
officer, the contracting officer's representative,
the contract specialist, and other responsible
contracting officials in GSA's Region 10.

Further, in addressing this issue, we obtained and
evaluated the facts involved in the union's
allegations and GSA's responses. We did not
attempt to determine the validity of the
allegations beyond information that was available
from the documents and oral testimony provided by
officials of the union, GSA, and other federal and
state agencies that addressed aspects of some of
the allegations.

We also discussed with officials of the National
Labor Relations Board (NLRB), Region 19, in
Anchorage and in Seattle, the formal charges the
union filed against ISI alleging unfair labor
practices in violation of the National Labor
Relations Act. We discussed with the NLRB Resident
Officer in Anchorage the nature of the charges and
whether GSA had reported the labor problems
between the union and ISI to NLRB.

We discussed the information contained in a draft
of this report with officials of GSA's Region 10
and with DOL. We made changes and incorporated
their comments where appropriate. Also, we
requested comments on a draft of this report from
the GSA Administrator and the Secretary of Labor.
Their comments were considered in preparing our
final report. We did our work from October 1999 to
September 2000 in accordance with generally
accepted government auditing standards.

Appendix II
Comments From the General Services Administration
Page 41       GAO-01-75 Anchorage Federal Building

Appendix III
GAO Contacts and Staff Acknowledgments
Page 42       GAO-01-75 Anchorage Federal Building
GAO Contacts
Bernard L. Ungar (202) 512-8387

Sherrill H. Johnson (214) 777-5600

Acknowledgments
     In addition to those named above, Victor B.
Goddard, Robert T. Griffis, Adam Vodraska, and
William T. Woods made key contributions to this
report.

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