Contract Management: INS Contracting Weaknesses Need Attention	 
from the Department of Homeland Security (25-JUL-03, GAO-03-799).
                                                                 
With annual obligations for goods and services totaling $1.7	 
billion, the Immigration and Naturalization Service (INS) is one 
of the largest of 23 entities coming into the Department of	 
Homeland Security (DHS). INS's procurement organization will	 
continue to acquire goods and services under DHS. GAO was asked  
to review INS's contracting processes to assess whether INS has  
an adequate infrastructure to manage its acquisitions and to	 
determine whether INS is following sound contracting policies and
procedures in awarding and managing individual contracts.	 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-03-799 					        
    ACCNO:   A07721						        
  TITLE:     Contract Management: INS Contracting Weaknesses Need     
Attention from the Department of Homeland Security		 
     DATE:   07/25/2003 
  SUBJECT:   Contract administration				 
	     Internal controls					 
	     Procurement policy 				 
	     Procurement practices				 
	     Procurement planning				 
	     Federal procurement				 
	     Federal agency reorganization			 

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GAO-03-799

Report to the Committee on Government Reform, House of Representatives

United States General Accounting Office

GAO

July 2003 CONTRACT MANAGEMENT

INS Contracting Weaknesses Need Attention from the Department of Homeland
Security

GAO- 03- 799

INS does not have the basic infrastructure* including oversight,
information, and an acquisition workforce* in place to ensure that its
contracting activity is effective, principally, as follows:

Oversight of procurement is difficult because procurement managers are
placed at a low level within the organization, and they do not have the
leverage to hold employees across the agency accountable for compliance
with procurement policies. Further, procurement activities are not
coordinated well because INS has not made effective use of cross-
functional teams* consisting of procurement, program, budget, financial,
and legal representatives* throughout the acquisition process. Procurement
managers are unable to make strategic decisions that

would allow them to maximize spending power across the agency because
INS*s information systems do not provide visibility into what is being
spent agencywide for goods and services and who the major vendors are.

INS*s acquisition workforce is struggling to manage effectively large and
mission- critical procurements. Despite growth in mission requirements and
the overall workforce during the past decade, the agency has not been able
to attract and retain the necessary contracting staff. Further, INS lacks
a strategic acquisition workforce plan to help identify the knowledge,
skills, and abilities the agency needs to ensure it can meet current and
future requirements.

In addition, acquisition planning, competition, and contractor monitoring
have been inadequate on some large contracts. The lack of adequate
advanced planning for several detention center contracts and one large
information technology management contract limited opportunities for full
and open competition. Contractor performance monitoring has, in some
cases, been inadequate to provide assurance that INS received the goods or
services it paid for or that quality standards were met. GAO did not find
significant or widespread compliance problems with other contract criteria
we reviewed. Because INS has become a significant part of DHS and brings
with it a

procurement function that needs attention, it is imperative for DHS
leadership to address these problems early in the development of the new
department. With annual obligations for goods

and services totaling $1. 7 billion, the Immigration and Naturalization
Service (INS) is one of the largest

of 23 entities coming into the Department of Homeland Security (DHS).
INS*s procurement

organization will continue to acquire goods and services under DHS. GAO
was asked to review INS*s

contracting processes to assess whether INS has an adequate infrastructure
to manage its acquisitions and to determine whether INS is following sound

contracting policies and procedures in awarding and managing individual
contracts. GAO is recommending that DHS

take several actions to mitigate procurement risk as it integrates INS*s
procurement function. DHS should assess and develop strategies to improve
oversight, strategic use of information,

workforce planning, and contract management. In written comments on a
draft of this report, DHS agreed with the recommendations and indicated
that it will proceed in accordance with them.

www. gao. gov/ cgi- bin/ getrpt? GAO- 03- 799. To view the full product,
including the scope and methodology, click on the link above. For more
information, contact David Cooper at (617) 788- 0555 or cooperd@ gao. gov.
Highlights of GAO- 03- 799, a report to

House Government Reform Committee July 2003 CONTRACT MANAGEMENT

INS Contracting Weaknesses Need Attention from the Department of Homeland
Security

Page i GAO- 03- 799 Contract Management Letter 1 Results In Brief 2
Background 3 INS Lacks the Infrastructure Needed to Manage Its Procurement

Activities Effectively 5 Acquisition Planning, Competition, and Contractor
Monitoring Have Been Inadequate in Some Cases 15 Conclusion 21
Recommendations for Executive Action 22 Agency Comments 23 Appendix I
Scope and Methodology 25

Appendix II Comments from the Department of Homeland Security 28

Appendix III Contract File Review Criteria 29

Appendix IV List of Active Contract Files Reviewed ($ 100 or More), as of
April 3, 2002 31

Appendix V Warrant Authority of INS Contracting Officers 33

Table

Table 1: Acquisition Workforce Occupation Codes 26 Figures

Figure 1: Fiscal Year 2002 Contract Obligations 4 Figure 2: Organization
of the INS 7 Figure 3: INS Procurement Dollars 12 Contents

Page ii GAO- 03- 799 Contract Management Abbreviations

COTR Contracting Officer*s Technical Representative DHS Department of
Homeland Security FAR Federal Acquisition Regulation INS Immigration and
Naturalization Service IPRO Intelligent Procurement System STARS Service
Technology Alliance Resources

This is a work of the U. S. Government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
its entirety without further permission from GAO. It may contain
copyrighted graphics, images or other materials. Permission from the
copyright holder may be necessary should you wish to reproduce copyrighted
materials separately from GAO*s product.

Page 1 GAO- 03- 799 Contract Management July 25, 2003 The Honorable Tom
Davis Chairman

The Honorable Henry A. Waxman Ranking Minority Member Committee on
Government Reform House of Representatives

In January 2003, we designated the implementation and transformation of
the Department of Homeland Security (DHS) as high- risk due to the size
and complexity of the effort, the existing challenges faced by the
components being merged into the department, and the potentially serious
consequences should DHS fail to effectively carry out its mission. 1 DHS,
which is expected to have some of the most extensive acquisition
requirements in government, is currently in the process of integrating the
mission functions and acquisition practices of 23 incoming entities. The
Immigration and Naturalization Service (INS) is one of the largest
agencies coming under the new department, with a budget of $6.1 billion
and

contracts for goods and services valued at $1.7 billion in fiscal year
2002. INS*s procurement organization will continue to acquire goods and
services under DHS. Given the heightened importance of INS*s mission due
to threats to the security of our nation, you asked us to review INS*s
contracting processes. Specifically, we assessed whether INS has an
adequate infrastructure* including oversight, information, and workforce*
to manage its acquisitions. In addition, you asked us to determine whether
INS is following sound contracting policies and procedures in awarding and
managing individual contracts.

We conducted our work at INS headquarters and administrative centers. We
also reviewed 42 randomly selected contracts for compliance with key
criteria in several functional areas of contract management. Specific

information on our scope and methodology is in appendix I. We performed 1
U. S. General Accounting Office, Major Management Challenges and Program
Risks* Department of Homeland Security, GAO- 03- 102 (Washington, D. C.:
Jan. 1, 2003).

United States General Accounting Office Washington, DC 20548

Page 2 GAO- 03- 799 Contract Management the bulk of our audit work prior
to INS*s becoming part of DHS. For readability, we refer to INS in the
present tense in this report.

INS does not have the basic infrastructure* including oversight,
information, and an acquisition workforce* in place to ensure that its
contracting activity is effective. Procurement managers are placed at a
low level within the organization, and they do not have the leverage to
hold employees across the agency accountable for compliance with
procurement policies. INS has not made effective use of cross- functional
teams* consisting of procurement, program, budget, financial, and legal
representatives* throughout the acquisition process. Procurement

managers are unable to make strategic decisions that would allow them to
maximize spending power across the agency because INS*s information
systems do not provide visibility into what is spent for goods and
services agencywide and who the major vendors are. In addition, while
INS*s mission requirements and the overall workforce have greatly expanded
in the past decade, the agency has not been able to attract and retain the

contracting staff needed to effectively manage the increased workload. INS
has not consistently ensured that acquisition personnel are adequately
trained to do their jobs. Further, INS lacks a strategic acquisition

workforce plan to help identify the knowledge, skills, and abilities the
agency needs to ensure it can meet current and future requirements.

Our review of 42 contracts, randomly selected from a total of 185 active
contracts, identified problems in two key areas: acquisition planning and
contractor monitoring. The lack of adequate advanced planning for several
detention center contracts and one large information technology management
contract limited opportunities for competition. In addition, contractor
performance monitoring has, in some cases, been inadequate to assure that
INS received the goods or services it paid for or that quality

standards were met. We did not find significant or widespread compliance
problems with other contract criteria we reviewed.

The creation of DHS brings an opportunity to address the issues we have
identified in this report. We are recommending that the Secretary of DHS
direct the Under Secretary for Management to take several actions to
mitigate these problems as the INS procurement function is integrated into
DHS. In written comments on a draft of this report, DHS agreed with our
recommendations and indicated that it will proceed in accordance with
them. DHS comments are included in their entirety in appendix II. Results
In Brief

Page 3 GAO- 03- 799 Contract Management As of March 1, 2003, INS ceased to
exist as an agency. 2 It is now in the process of being incorporated into
DHS. INS*s multi- faceted mission

includes securing the borders; enforcing immigration laws; and providing
immigration services, such as work permits, naturalization, and asylum.
Under DHS, the INS mission has been split between three bureaus within the
department, 3 and the INS procurement organization will continue to
procure goods and services under the Bureau of Immigration and Customs
Enforcement.

In fiscal year 2002, INS contracted for $1.7 billion in goods and
services. The headquarters procurement office is responsible for procuring
information technology, as well as goods and services of a general nature
that are used agencywide. DHS continues to operate the three INS
administrative centers (Dallas, Texas; Laguna Niguel, California; and
Burlington, Vermont) that were formerly a part of INS. The administrative
centers have responsibility for awarding and managing INS*s detention
center management contracts and contracts for goods and services for INS
field offices. Figure 1 shows the breakdown of procurement responsibility
between INS headquarters and the administrative centers in fiscal year
2002.

2 Section 471 of the Homeland Security Act of 2002 (P. L. 107- 296,
enacted Nov. 25, 2002) abolished the INS following the transfer of its
functions to DHS. The President*s reorganization plan transferred the
functions of the INS to the new department on March 1, 2003.

3 The three bureaus are the Bureau of Customs and Border Protection, the
Bureau of Immigration and Customs Enforcement, and the Bureau of
Citizenship and Immigration. Background

Page 4 GAO- 03- 799 Contract Management Figure 1: Fiscal Year 2002
Contract Obligations

Note: These amounts include $600 million in goods and services that were
provided by other government agencies through interagency agreements.

INS also has more than 600 field offices across the United States. The
field offices* authority to award contracts is generally limited to
$25,000 for open market purchases and $100,000 for delivery orders against
existing contracts. Field office contract obligations totaled $66.5
million in fiscal year 2002. 4 DHS officials are currently working out the
details of how to merge the

procurement functions of the incoming agencies, including INS. A Chief
Procurement Officer was recently appointed and will report to the Under
Secretary for Management. In preparing to implement DHS- specific
procurement policies, a working group is drafting a DHS supplement to the
Federal Acquisition Regulation (FAR). DHS officials are currently
assessing the incoming agencies* (1) major procurements to determine
whether duplication exists and to identify ways of maximizing the DHS*s
purchasing power by consolidating like procurements where feasible; (2)

4 For the purposes of this report, *field offices* refer to sites
receiving administrative services from INS*s administrative centers. Field
offices include INS*s districts, sectors, and suboffices. The $66.5
million is a component of the $1. 7 billion in contract obligations cited
on p. 1.

Page 5 GAO- 03- 799 Contract Management procurement and financial systems
to determine whether any of the existing systems are adequate to meet the
department*s future needs; and (3) acquisition workforce to identify gaps
and the need for DHS- specific

training requirements. INS does not have in place a basic infrastructure
to effectively manage its contracts. INS procurement managers lack
leverage to ensure that employees comply with procurement policies, and
managers cannot make strategic procurement decisions due to the absence of
comprehensive and reliable information about the goods and services being
procured across

the agency. Further, INS*s acquisition workforce is not adequate to manage
the agency*s increased mission requirements. INS has not developed a
strategic acquisition workforce plan to help ensure that acquisition
personnel across the agency have the right skills and that gaps in the
workforce are addressed proactively. INS procurement managers have little
oversight and control over

procurement activities throughout the agency, a situation that increases
the risk that taxpayers are not getting the best value for their dollars.
Our prior work has identified a number of factors that promote efficient,
effective, and accountable procurement. 5 We found that successful,
leading companies had reengineered their procurement practices to move
from a fragmented approach to a more coordinated and strategically
oriented approach. By elevating the procurement function in the structure
of the organization and establishing strong oversight mechanisms, these
companies were able to make and implement strategic decisions to improve
companywide outcomes. In addition, the companies ensured that the
procurement function was integrated across the organization through the
use of cross- functional teams, consisting of procurement, program, and
financial personnel. Responsibility for acquiring goods and services is
dispersed throughout

INS headquarters, administrative centers, and field offices. Headquarters
procurement managers have responsibility for some agencywide functions,
such as providing policy, overseeing compliance with procurement laws and
regulations, and preparing required reports on

5 U. S. General Accounting Office, Best Practices: Taking a Strategic
Approach Could Improve DOD*s Acquisition of Services, GAO- 02- 230
(Washington, D. C.: Jan. 18, 2002). INS Lacks the

Infrastructure Needed to Manage Its Procurement Activities Effectively

INS Procurement Managers Lack Leverage to Oversee Contracting Activity
Effectively

Page 6 GAO- 03- 799 Contract Management agencywide procurement activities.
These managers also review proposed administrative center contracts of
more than $500, 000. 6 However, they have little insight into transactions
conducted by INS*s field offices.

Headquarters procurement managers were only able to provide us summary
data for field office transactions, because they do not have information
on the number and dollar amount of individual transactions.

In addition, the headquarters procurement office is placed far down in the
organizational structure, buried under several layers of management. This
placement increases the likelihood that the procurement function will not

receive attention from the highest levels of the organization. As
illustrated in figure 2, the Bureau Procurement Chief reports at a lower
organizational level than Files and Forms Management. At the
administrative centers, the procurement function is combined with property
management.

6 Of the administrative center contracts active in November 2002, more
than half* 39 of 68* were valued at more than $500,000.

Page 7 GAO- 03- 799 Contract Management Figure 2: Organization of the INS

INS headquarters procurement managers lack the leverage to ensure that
administrative center and field office contracting personnel follow INS
procurement directives and policies. While contracting officers in these
offices derive their contracting authority from headquarters, they report
through the administrative center or field office chain of command, not to
headquarters procurement managers. This situation has been especially
problematic in the field offices, which rely heavily on *collateral duty*

contracting officers who perform contracting duties in addition to their
mission- related responsibilities and who are not career contracting
officers. The performance appraisals of the collateral duty contracting
officers reflect only their mission- related duties and do not address
their

Page 8 GAO- 03- 799 Contract Management procurement activities. For
example, the performance rating of a Border Patrol agent, who is a
collateral duty contracting officer, is based on whether he accomplishes
the Border Patrol*s mission and does not take

into account whether he follows INS*s procurement procedures. Further,
according to the Assistant Commissioner for Administration, the
procurement office has little leverage to stop employees from entering
into unauthorized commitments. 7 In fiscal year 2002, INS had 60
unauthorized commitments valued at more than $700,000. For example, an
employee arranged for a vendor to conduct a training class without first
contacting the procurement office to award a contract for this service,
for which INS ended up paying $15,800. In another case, an employee asked
a subcontractor to provide $3,181 in computer upgrade services. While
these services may have been necessary, only warranted contracting
officers have authority to enter into and modify contracts with vendors.
Unauthorized commitments are counterproductive in that they require
additional time and effort from procurement personnel to ratify the
commitments and to work with the parties involved to avoid future
occurrences. 8 Procurement officials have attempted to educate and train
employees about proper procedures, but the officials expressed frustration
that unauthorized commitments continue to occur.

INS has made limited use of internal controls, such as internal reviews
and performance goals and measures, that could help monitor procurement
activity across the agency. For example, while some officials said that
the Office of Internal Audit*s periodic reviews are helpful in identifying
problem areas, others noted that these reviews are not thorough or
frequent enough (each office is scheduled for review once every 3 years).
In addition, while headquarters and administrative centers established
performance goals and measures to help evaluate the effectiveness of the
procurement function, these efforts have not been effective. A consulting

7 Under FAR 1.602- 3, an unauthorized commitment is an agreement with a
vendor that is not legally binding on the government because the
government representative who placed the order lacked the authority to
enter into the agreement on behalf of the government, such as by lacking a
written contracting officer*s warrant or exceeding the specified

authority of a warrant. 8 Ratification involves a determination by the
official authorized to ratify unauthorized commitments that the resulting
contract would have otherwise been proper if made by an appropriate
contracting officer, that the price of the unauthorized commitment is fair
and reasonable, that payment is recommended (with concurrence from legal
counsel), and that funds are available and were available at the time the
unauthorized commitment was made.

Page 9 GAO- 03- 799 Contract Management firm helped the INS headquarters
procurement office set goals, such as obligating funds in a timely manner;
providing clear, consistent customer

guidance; maximizing private and public sector resources; and complying
with statutory requirements. Similarly, the administrative centers
attempted to standardize processes and establish time frames for various
procurement services. However, INS headquarters officials told us that
they were unable to monitor whether they achieved their goals because the
data and analyses necessary to track progress were unavailable.
Administrative center procurement managers said that the time frames

they were given were not meaningful, as the targets set were very low.
Further, INS has not made effective use of cross- functional teams*
consisting of procurement, program, legal, budget, and financial
representatives* throughout the acquisition process. Stakeholders outside
of the procurement offices are often involved only on an ad hoc basis.
Personnel across the agency told us that the relationship between program
and procurement officials has been particularly problematic and that these
offices often have not worked collaboratively to define project
requirements and perform other acquisition- related functions. In fact, in
some cases, the relationship has been adversarial. One INS procurement

official said the program offices sometimes *throw the requirements over
the transom,* leaving the procurement office to try to meet the program
office*s needs in a vacuum. Procurement managers said that they have

difficulty getting program offices to comply with procurement requirements
such as planning acquisitions, monitoring contractor performance, and
attending required training. Some managers attributed the problem to INS*s
culture, where program offices have traditionally been highly independent.
On the other hand, program officials stated that procurement personnel

are not customer- oriented or proactive in finding ways to meet program
needs. Program officials said that they are unsure of their roles and
responsibilities in the procurement process and that they lack needed
procurement guidance. For example, one program manager said that

procurement personnel expect her office to choose a contract type or to
complete independently contracting- related paperwork. She believes this
responsibility is best left to personnel with procurement expertise.

INS managers are unable to make strategic procurement decisions because
they do not have sufficient information about the goods and services being
procured across the agency and who their major vendors are. In the past,
we have reported that when leading companies obtain INS Lacks Information
It

Needs to Make Strategic Procurement Decisions

Page 10 GAO- 03- 799 Contract Management improved knowledge about the
goods and services that are being procured, these companies can create
significant cost savings and service

improvements. 9 Agencies need the capability to analyze how much is being
spent on each good and service* through the use of interfaced procurement
and financial systems* so the agencies can identify opportunities to
reduce costs, improve service, and better manage their suppliers.

INS procurement personnel primarily use two mechanisms to collect
procurement data. The Intelligent Procurement System (IPRO) is an
automated system used to generate solicitation and contract documents and
to track basic procurement data such as requisition numbers, obligations,
date of contract awards, and the amount of time to process requisitions.
Procurement personnel also use a variety of informal data collection
tools* including manual entry logbooks, spreadsheets, and stand- alone
databases* to track administrative information, such as contract status,
and to provide data to the Federal Procurement Data System. 10 However,
the data collected through these means are not comprehensive or reliable.
Contract administration information, such as contract closeout status, is
often missing and contract modifications are often not up to date. In
addition, IPRO contains weak internal edit checks that render the data
potentially inaccurate, and it does not automatically populate forms and
fields with existing data. INS internal audits 11 have reported that
administrative center officials have not been proactive in giving feedback
to field staff who input the data so that errors can be corrected.

Because INS cannot aggregate procurement data across the agency, it cannot
gain the strategic visibility into purchasing behavior required to
negotiate vendor discounts or otherwise leverage buying power. Procurement
data are stored in separate regional databases or files on local networks
that are inaccessible to users in other regions. Procurement managers
frequently rely on active contracts lists-- manual

9 U. S. General Accounting Office, Best Practices: Taking a Strategic
Approach Could Improve DOD*s Acquisition of Services, GAO- 02- 230
(Washington, D. C.: Jan. 18, 2002) and

Best Practices: Improved Knowledge of DOD Service Contracts Could Reveal
Significant Savings, GAO- 03- 661 (Washington, D. C.: June 9, 2003).

10 The Federal Procurement Data System is the central repository of
statistical information on federal contracting. 11 INS refers to these
audits as *INSpect reviews.*

Page 11 GAO- 03- 799 Contract Management spreadsheets separately
maintained by the administrative centers and headquarters-- for
information about ongoing procurement activity. When

we requested data on active contracts, INS procurement managers had to
separately request this information from each administrative center and
headquarters. Further, these lists contain duplicative records and, in
some instances, contradictory data about contract expenditures. INS
managers stated that they have difficulty developing INS budget
submissions because of the absence of useful procurement data.

Even if basic information, such as the active contracts lists, were
accurate, INS procurement managers would be hindered in their ability to
make strategic decisions about agencywide procurements because IPRO does
not interface with INS*s financial management system. If the systems were
interfaced, procurement managers would have improved access to financial
data, such as real- time reports on obligations and payments for goods and
services. Managers could then analyze spending patterns to determine what
they are buying* and from whom* and use this information to more
confidently plan future spending.

INS*s mission and overall workforce have expanded greatly in the past
decade, and spending on contracts has also increased significantly.
However, the size of INS*s contracting workforce has not grown in
sufficient numbers to manage this increased workload effectively. Further,
INS has not ensured that its acquisition personnel are adequately trained
to do their jobs. A strategic acquisition workforce plan could help INS

ensure that acquisition personnel across the agency have the right skills
and that gaps in the workforce are addressed proactively.

From 1997 to 2002, INS*s workload increased greatly and its overall
workforce expanded by 38.5 percent, from 25,750 to 35,676. In conjunction
with the increased workload, procurements almost doubled, as shown in

figure 3. INS*s Acquisition

Workforce Is Inadequate to Manage Increased Workload

Page 12 GAO- 03- 799 Contract Management Figure 3: INS Procurement Dollars

Despite this growth, the procurement offices at headquarters and the
administrative centers remain understaffed. While INS*s overall
acquisition workforce has grown, from 101 in 1997 to 148 in 2002, the
agency is still short of critical contracting officer positions. 12 Two
outside studies, in 2000 and 2001, concluded that INS*s acquisition
workforce was understaffed. One study determined that the understaffing
caused delays in completing required tasks, and another recommended an
additional 17 positions in the administrative center procurement offices.
INS headquarters and administrative center procurement offices have
attempted to address this understaffing by requesting additional positions
and trying to fill the procurement positions they already have in place.
However, neither effort has been successful.

Headquarters officials requested 13 additional contracting officers in
2001; 11 in 2002; and 12 in 2003; and the administrative centers also
requested additional positions. However, procurement officials told us
that these

12 The acquisition workforce encompasses 14 different occupation codes, 2
of which comprise these contracting officer positions. Appendix I lists
the codes we used in this report to define the acquisition workforce.

Page 13 GAO- 03- 799 Contract Management requests were denied. 13 Further,
the agency has not been able to fill many of its existing vacancies. As of
March 2003, 14 authorized procurement

positions were vacant in headquarters. Several of these vacancies have
remained open for extended periods of time* one up to 2 years. Procurement
officials said that they have trouble recruiting college graduates and
experienced acquisition personnel because of the perception of INS as a
dysfunctional organization and the uncertainty of the transition to DHS.
They indicated that many of the applicants they get are not qualified. In
addition, the procurement office does not use human

capital flexibilities* such as recruitment and retention bonuses* made
available by the Office of Personnel Management. A headquarters
procurement official said that his office considered using a relocation
bonus but determined it was too expensive. He planned to fill six of the
current vacancies with individuals from the outstanding scholar program;
however, as of June 2003, none of the positions had been filled. 14 INS
procurement officials stated that 55 contracting positions were filled at
the end of fiscal year 1998, and that as of May 2003 only 56 contracting
positions were filled.

Our prior work has shown that high performing organizations identify their
current and future human capital needs and then create strategies* such as
targeted investments in employees or recruiting and retention bonuses* in
acquisition workforce plans. 15 These plans enable the organization to
determine the critical skills and competencies needed to achieve future
results. A workforce plan could, for example, allow INS to correct the
current imbalance of contracting skills among the administrative centers.
INS has four warrant levels that grant contracting officers authority to
contract on behalf of the agency and that specify the limits of this
authority. 16 The Burlington administrative center has five

employees with warrant levels of three or higher, which enable them to 13
INS budget documents did not provide sufficient detail for us to determine
at what level the requests for additional procurement personnel were
denied, because the distinction between procurement positions and other
support positions is not maintained in the budget documentation. Further,
the administrative center requests are combined into one request and
submitted to INS headquarters.

14 The outstanding scholar program is intended to allow agencies to
quickly hire college graduates with superior academic credentials for
entry- level positions. 15 U. S. General Accounting Office, High Risk
Series: Strategic Human Capital Management, GAO- 03- 120 (Washington, D.
C.: Jan. 1, 2003). 16 See appendix V for description of individual warrant
limits.

Page 14 GAO- 03- 799 Contract Management award open- market contracts for
at least $1 million and to make unlimited buys from the Federal Supply
Schedule. 17 In contrast, for a year, the Dallas

administrative center had only one warrant- level- four officer and one
level- two officer. When the level- four officer was out of the office, no
other employee had the authority to award a contract of more than $100,
000. The center has since hired another specialist with a level- four
warrant.

Another factor affecting INS*s acquisition workforce is the administrative
centers* use of term appointments. 18 Term appointments are intended to
address short- term workforce needs; however, procurement managers have
used these positions to fulfill their long- term needs because of a lack
of funding for permanent positions. As a result, INS has committed
resources and time to train employees who cannot be retained by the
agency. A consulting firm recommended ending the use of short- term
positions because of reduced productivity, high turnover rates, and

constant training of new term employees. Administrative center procurement
officials said that they had requested several times that their term
appointments be converted to permanent positions, but that no action was
taken.

Further, INS procurement managers have not ensured that contracting
officers receive consistent training across the agency. Internal audits in
2000 and 2001 revealed that some contracting officers in the
administrative centers and field offices had not completed the 40 hours of
annual training

that INS requires. In response, INS began tracking contracting officers*
training and sending reminders to complete training before the end of the
year. At the end of calendar year 2001, procurement officials rescinded
the warrants of contracting officers who had not met the training
requirement, and additional warrants were rescinded at the end of calendar
year 2002. In addition, inconsistencies in the training budgets for
procurement

personnel administrative center and headquarters have resulted in
disparate training for new hires across INS. For example, one

17 The Federal Supply Schedule offers a large group of commercial products
and services, ranging from office supplies to information technology
services. 18 Term appointments are temporary appointments that are
intended to last the length of a project of more than 1 year, and they can
be renewed up to 4 years. At the end of the 4 years, the appointment is
terminated. According to an INS official, the employee may not apply for
another term appointment with a similar job description. Term employees
receive

the same pay, benefits, and training requirements as permanent employees
with the same job description.

Page 15 GAO- 03- 799 Contract Management administrative center received
only enough funding to provide the required 40 hours of annual training
for newly hired personnel. However,

each of four recent hires at the headquarters procurement office received
400 hours or more of training over a 2- year period. If this amount of
training is needed for each new hire, agency planning could help ensure
that sufficient resources are available to provide needed training to all
new staff in a more consistent manner.

Finally, we found that contracting officers are not provided consistent
training due to a lack of centralized coordination of training materials.
For example, each administrative center created and conducted its own
training program on IPRO, resulting in duplication of effort. Similarly,
although INS created one purchase card procedures manual, administrative
center and headquarters procurement offices created their own training
presentations and supporting materials. INS officials commented that
procurement training within the INS contracting community is affected by
the geographic dispersion of the procurement function as well as the
placement of the procurement function within three separate agency chains
of command. They noted that INS recently began a purchase card refresher
training program that has provided training to over 1,000 agency employees
since January 2003. Our review of 42 contracts, randomly selected from a
total of 185 active

contracts awarded by headquarters and each administrative center, found
that INS did not adequately plan for several of its large acquisitions or
effectively involve key stakeholders, such as the program and legal
offices. In some cases, this lack of advanced planning and collaboration
limited opportunities for full and open competition. Further, INS did not
consistently monitor contractor performance on many of the contracts we
reviewed, meaning that INS could not be assured that it received the goods
and services it paid for or that the contractors met the quality standards
in the contract. We did not find significant or widespread compliance
problems with FAR requirements and INS*s own acquisition policies in the
areas of market research, evaluation of contractors* proposals,

documentation of source selection decisions, and contract modifications.
19 The contracts we reviewed are listed in appendix IV. 19 Our scope and
methodology section, in appendix I, discusses in more detail how we drew
the sample of contracts and appendix III lists the criteria we used in our
file review. Acquisition Planning,

Competition, and Contractor Monitoring Have Been Inadequate in Some Cases

Page 16 GAO- 03- 799 Contract Management The FAR establishes uniform
policies and procedures for the acquisition of supplies and services by
all executive agencies, including INS. It

requires acquisition planning in order to promote full and open
competition and to ensure that the government meets its needs in the most
effective, economical, and timely manner. 20 During the acquisition
planning process, the efforts of all personnel responsible for an
acquisition are to be

coordinated and integrated through a comprehensive plan for fulfilling the
agency*s requirement in a timely manner and at a reasonable cost. An
overall strategy for managing the acquisition is required to be developed
well in advance of the planned contract*s award date. The acquisition
planning process requires a close partnership between the program and
contracting offices and involvement of other key stakeholders, such as
legal and financial personnel. When agencies fail to adequately plan for
acquisitions, they risk limiting the opportunity for full and open
competition and receiving inadequate goods and services at a higher cost.
In three of the five detention facility contracts that we reviewed, INS
failed

to plan adequately for its acquisitions and to involve key stakeholders
effectively. As a result, short- term sole- source contracts were
continuously awarded to incumbent contractors until a permanent contract
could be

competitively awarded. These *bridge* contracts were awarded without the
full and open competition normally required for the solicitation and award
of government contracts. 21 For example, the Dallas administrative
center*s original contract for the

Houston Detention Facility expired on September 30, 1998. The solicitation
for a new contract was not issued until August 5, 1998, which did not
allow adequate time for environmental assessments and any new
construction. As a result, a bridge contract was awarded and is still in
place. The contracting officer justified this sole source contract based
on *unusual and compelling urgency* (the incumbent contractor had the only

detention facility in the area with the necessary capacity). However, the
justification documentation did not explain why planning did not occur
earlier in the procurement process. It merely stated that in the future,
the program office would be required to ensure that the acquisition
process was started 2 to 3 years in advance of the contract*s expiration
date. INS

20 FAR 7.102. 21 Some of these bridge contracts may have been
modifications to the incumbent contractor*s expiring contract in order to
continue performance until the competitive award of a successor contract.
For Several Large

Contracts, Acquisition Planning Was Inadequate to Ensure Full and Open
Competition

Page 17 GAO- 03- 799 Contract Management awarded the sole source contract
despite the opinion of the INS General Counsel*s office that the basis for
using other than full and open

competition was not legally sufficient. 22 In another example, in May of
1998, the Laguna Niguel administrative center announced the need for a
larger detention facility in San Diego. Because the existing contract was
due to expire shortly, there was insufficient time to complete routine
environmental assessments and evaluations of proposals for new facility
space. As a result, INS awarded a 1- year sole source contract, again
citing *unusual and compelling* need as justification. Only the incumbent
contractor was capable of providing the required space in the necessary
timeframe.

Historically, INS has had great difficulty in stimulating competition for
detention center contracts* even when advanced planning was done*
particularly in situations where a contractor has an established facility
in the locale. For example, when the Dallas administrative center issued a
solicitation for its Laredo detention facility contract in March 1997,
only one contractor, the incumbent, submitted a proposal, leading the
procurement office to refer to this contract as *essentially a sole source
acquisition.* Likewise, the incumbent contractor was the only offeror when
the Burlington administrative center awarded its current Newark Detention
Facility contract. A 1998 INS memo stated that, as a result of the
difficulties in stimulating competition, *negotiations and award of
attractively priced [detention facility] contracts has become increasingly

22 FAR 6.301 states that contracting without providing for full and open
competition shall not be justified on the basis of a lack of advanced
acquisition planning by the requiring activity. This reflects language in
the Competition in Contracting Act of 1984, 41 U. S. C.

253( f)( 5)( A) that in no case may an executive agency enter into a
contract for property or services using other than competitive procedures
on the basis of the lack of advance planning. In this example, the General
Counsel*s office pointed out that the lack of

collaboration between the program and the procurement offices *placed
contracting in an untenable and precarious position* and cited a similar
situation with a 1996 Denver detention center contract, which was also
awarded by the Dallas administrative center.

Page 18 GAO- 03- 799 Contract Management more difficult.* Under the
authority of the Attorney General, INS is developing longer- term
contracts for its detention centers. 23 Inadequate acquisition planning
also limited the opportunity for

competition under a large information technology support contract for
INS*s Entry/ Exit program. 24 This contract provides program management
and support services to INS for development of its Entry/ Exit system, an
automated system for collecting information about foreign nationals
entering and exiting the United States and identifying those that have
overstayed their visits. The Department of Justice contracting officer,
who

initially awarded the contract, told us that he was provided with the
program requirements March 8, 2002, only 3 weeks before the contract had
to be awarded. Just 5 months after award, INS modified the contract to

provide additional services, increasing the base- year value of the
contract by over $4 million, to $5.3 million. The INS General Counsel*s
office did not concur with modifying the contract, citing the *dramatic*
mission expansion and inadequate program planning. Nevertheless, INS
implemented the modification. INS procurement officials stated that they
are currently re- competing the contract, based on their continuing need
for technology support for the program.

In contrast, the Service Technology Alliance Resources (STARS) contract, a
multiple award contract designed to provide INS with a full range of
information technology products and services, included the most extensive
acquisition planning documentation of any contract we reviewed.
Headquarters procurement officials indicated this was a highvisibility
procurement and therefore received more upfront planning than is normally
the case. The procurement was also much larger than usual, at slightly
more than $3 billion.

In some cases, the lack of collaboration between procurement and program
officials hindered acquisition planning, resulting in failure to

23 The 2001 Department of Justice Appropriations Act (P. L. 106- 553, app.
B, section 119, at 114 Stat. 2762A- 69) authorized the Attorney General,
notwithstanding any other provision of law, to enter into contracts and
other agreements, of any reasonable duration, for detention or
incarceration space or facilities, including related services, on any
reasonable

basis. Because INS is no longer part of the Department of Justice, DHS
should determine whether this authority still applies to its INS
procurement function and, if not, whether similar authority is needed to
continue developing long- term detention center contracts.

24 On April 29, 2003, the Secretary of DHS renamed the Entry/ Exit system
the U. S. Visitor and Immigrant Status Indication Technology System (U. S.
VISIT).

Page 19 GAO- 03- 799 Contract Management obtain competition. For example,
INS*s contract for uniforms for the Border Patrol, Detention and Removal,
and Inspection and Immigration

offices was due to expire in 1999. Procurement officials began to work
with these program offices to develop requirements for a new contract.
However, due to difficulties in getting the program offices actively
involved in developing the requirements and evaluating contractor
proposals, the procurement office had to award a sole source bridge
contract until a new contract could be competitively awarded in December
2000. The uniform contract is currently valued at $32 million.

Another example of the lack of collaboration in acquisition planning
occurred when the contract for the Houston detention facility was about to
expire. According to the Assistant Commissioner for Administration,
because the program office was unresponsive to questions posed by
potential bidders, the contracting officer was faced with either issuing a
sole source contract or not having a detention facility available in time
to meet program needs. Therefore, he awarded a temporary sole source
contract until a long- term contract could be competitively awarded.

It is important that agencies monitor contractors* performance to ensure
that the government receives the goods and services it contracts for and
that quality standards in the contract are met. In addition, the FAR calls
for quality assurance surveillance plans to be prepared in conjunction
with the statement of work, when necessary, to determine that the supplies
or services conform to contract requirements. 25 The plans should specify
all work requiring surveillance and the method of inspection. Further, the

FAR requires that the government inspection be documented. We found
inconsistent attention to monitoring contractor performance at INS.
Headquarters procurement personnel told us that their focus is primarily
on pre- award activities. The Assistant Commissioner for Administration
characterized the contracting function as an *obligation machine* that is
able to award contracts for goods and services but is not adequately
staffed to oversee the contracts once they are awarded. Officials at one
administrative center commented that their method of contract
administration is reactive versus proactive, citing several examples where
they found out about contract problems months after they occurred. We
found evidence of inadequate contractor performance

25 FAR 46.401. INS Has Not Sufficiently

Monitored Contractor Performance

Page 20 GAO- 03- 799 Contract Management monitoring in many of the
contract files we reviewed, as in the following examples:

 The Houston Detention Facility contract was awarded in 1998. A June 1999
INS internal audit report noted that the contractor*s performance did not
meet all the criteria in the contract and that the Contracting Officer*s
Technical Representative (COTR) was not performing the required functions
as outlined in the contract. For example, the COTR was not conducting
quality assurance reviews or maintaining records to validate whether
services were received. COTR surveillance of the contractor is now taking
place, but not every month as required under the terms of the contract.
The contracting office, however, sends the COTR e- mail reminders when the
monthly reports are not received.

 Under the Laguna Niguel administrative center*s janitorial services
contract, the contractor did not clean the facility*s kitchen, as called
for in the contract, for an entire year. This service was being performed
by detainees at the program office*s request, but because the COTR failed
to notify the contracting officer of this change, the contract was not
modified to reflect the revised requirements. Thus, no mechanism was in
place to ensure that the government was billed for services actually
provided. In fact, the invoices and receiving reports had been approved,
allowing the contractor to be paid $28,000 for services never

provided. Administrative center officials told us that, because the COTR*s
primary job was a time- consuming one, the COTR had little time to
dedicate to his contracting monitoring responsibilities. After becoming
aware of the change, the contracting officer modified the contract and the
contractor agreed to reimburse INS the amount it was overpaid.

In contrast, appropriate surveillance at the Burlington administrative
center led to identified savings for the government. Burlington is the
only location that has staff dedicated to contract administration, of
which contractor monitoring is a key component; and administrative center
officials said that this increased attention has paid off. Payments were
reduced by $264, 861 in fiscal year 2002 because contractors did not
perform to the contracts* quality standards or did not perform tasks
called for in the contracts.

Procurement officials told us that program offices* which have the
authority to select COTRs* often do not dedicate the personnel required to
monitor contractor performance adequately. For example, the COTR for the
INS Immigration Student Services contract, valued at over $73 million, has
been deployed on military leave since February 2003. The program

Page 21 GAO- 03- 799 Contract Management office responded to the INS
procurement office*s call for another COTR by designating the program
manager as the COTR, even though he had not

attended the requisite training. More than $8 million has been paid to the
contractor during the original COTR*s absence.

Further, the files we reviewed suggest that INS is inconsistently
implementing quality assurance surveillance plans. For example, 2 months
after INS awarded the Dallas Unarmed Guard Services contract, the program
office still had not provided the contracting office a plan outlining how
the COTRs would monitor contractor performance or establishing a monthly
inspection schedule. The contract file did not contain evidence that the
monitoring or inspections were ever accomplished. Documentation of the
government*s quality assurance plan is important because it outlines the
method and frequency with which contractor performance will be monitored.

The FAR also requires agencies to prepare contractor performance
evaluations for completed contracts over $100,000 in order to provide
current information for source selection purposes. 26 At INS, the COTRs,
program office employees, are responsible for completing these reports.
The reports are designed to formally provide contractors with documented
evaluation of their performance each year, and the information is entered

into a database for use by government agencies in evaluating contractors*
past performance. We found that the required evaluations had not always
been done. Ten of 29 of the contract files we reviewed that required
contractor performance reports (e. g., where the value exceeded $100,000)
did not contain evidence that the reports were completed. By not

completing contractor performance reports, INS limits its own awareness,
as well as that of other government agencies, of contractor performance.

The fact that INS has become a significant part of DHS makes it imperative
for DHS leadership, as it grapples with the challenge of putting in place
a procurement structure, to take immediate action to address the problems

we have identified in this report. DHS is expected to spend billions
annually to acquire a broad range of products, technologies and services,

26 FAR 42.1502 requires the completion of contractor performance
evaluations at the time work under the contract is completed. For
contracts with a period of performance lasting more than one year,
agencies are required to specify when an interim evaluation should be
prepared. INS requires an interim evaluation at the time an option is
exercised for the next

contract period. Conclusion

Page 22 GAO- 03- 799 Contract Management and these contractor- provided
goods and services will be critical to the department*s ability to achieve
its mission of protecting the nation from

terrorism. INS, one of the largest agencies coming under DHS, brings with
it a procurement function that needs attention. Its acquisition workforce
is struggling to effectively manage the large and mission- critical
procurements for which it is responsible. The creation of DHS brings an
opportunity to address these problems.

We recommend that the Secretary of DHS direct the Under Secretary for
Management to take the following actions as part of ongoing efforts to
implement DHS procurement policies.

To improve the effectiveness of the procurement function, we recommend
that the Under Secretary for Management

 ensure that cross- functional acquisition teams, consisting of program,
procurement, legal, budget, and financial officials, effectively
collaborate in planning and administering contracts;

 create and review meaningful procurement performance measures and
indicators to ensure that management directives are carried out by the
large number of field activities in the department; and

 as part of its assessment of existing information systems coming into
the department, determine what procurement and financial information must
be gathered to obtain strategic knowledge of spending behavior across the
department.

To address acquisition workforce issues, we recommend that the Under
Secretary for Management do the following:

 Develop a data- driven assessment of the department*s acquisition
personnel, resulting in a workforce plan that identifies the number,
location, and skills and competencies of the workforce. The plan should
also identify key strategies to attract and retain this workforce,
including use of available recruiting and retention flexibilities or other
targeted approaches. As part of this planning, ensure that term
appointments for procurement personnel are used as intended and not to
meet long- term needs. Recommendations for

Executive Action

Page 23 GAO- 03- 799 Contract Management  Explore ways of making
collateral duty contracting officers in field locations more accountable
through the procurement hierarchy for

their contracting work. To ensure that the department*s contracts are
well- managed, we recommend that the Under Secretary for Management

 develop a system for tracking the status of current detention facility
contracts so that contracting officers and program managers are
automatically alerted to begin the planning process at least two years
before a new contract has to be awarded; and

 implement ways of holding designated COTRs responsible for monitoring,
reporting, and documenting contractor performance (e. g., require them to
report on a regular basis to the contracting officer).

In written comments on a draft of this report, DHS agreed with our
recommendations and stated that it plans to proceed in accordance with
them. DHS stated that it recognizes the need to formalize the acquisition
workforce and plans to model the training and certifications of an
Acquisition Corps along the lines of the Defense Acquisition Workforce
Improvement Act. 27 Further, the department stated that all collateral
duty contracting officers will be phased out and that only professional
procurement personnel with the requisite training will have warrants. DHS
also stated that a 5- year strategic planning process has been
established, enabling program offices to plan acquisitions in advance.

The department also provided technical comments that we have incorporated
as appropriate. In these comments, some concern was expressed about our
description of the program offices* position that they sometimes lack
guidance from the procurement office about their roles and
responsibilities in the procurement process. Because this description
reflects comments made by the program officials with whom we spoke, we
have retained it in the report. Further, the department recommended
changes to the draft report that would place full responsibility on the

27 The Defense Acquisition Workforce Improvement Act (P. L. 101- 510,
Title XII) recognized acquisition as a multi- disciplinary career field
for the Department of Defense. Agency Comments

Page 24 GAO- 03- 799 Contract Management program offices for acquisition
planning. Because acquisition planning is a joint responsibility of both
the program and procurement offices, we did not make this change. We
conducted our review from October 2002 through May 2003 in

accordance with generally accepted government auditing standards. As
requested by your offices, unless you publicly announce the contents of
this report earlier, we plan no further distribution of it until 30 days
from the date of this letter. We will then send copies of this report to
other interested congressional committees and the Secretary of Homeland
Security. We will make copies available to others upon request. In
addition, the report will be available at no charge on the GAO Web site at
http:// www. gao. gov.

If you have any questions regarding this report, please contact me at
(202) 512- 4841 or Michele Mackin, Assistant Director, at (202) 512- 4309.
Other major contributors to this report were Lara Carreon, Andria Key,
Gary Middleton, Jeff Miller, Susan Tindall, and Adam Vodraska.

David E. Cooper Director, Acquisition and Sourcing Management

Appendix I: Scope and Methodology Page 25 GAO- 03- 799 Contract Management
To determine the level of oversight and control and stakeholder
involvement in contracting activities at the Immigration and
Naturalization Service (INS), we reviewed INS organizational charts to
gain insight into

where the procurement offices fall in the hierarchy and to determine the
lines of responsibility and authority between the various stakeholders in
the acquisition process. We reviewed Department of Justice and INS
policies and procedures governing acquisition and analyzed internal audit
reports to determine if those policies and procedures were being followed.
We obtained statistics from INS headquarters on unauthorized commitments
and viewed a training videotape, which is used agencywide, on unauthorized
commitments. At headquarters, we interviewed the

Assistant Commissioner for Administration and two of his branch chiefs. We
visited each of the administrative centers and interviewed key contracting
personnel. We also interviewed program managers in several INS program
offices. Lastly, we reviewed previous GAO work regarding best acquisition
practices and organizational alignment and oversight for leading
organizations.

To assess how effective existing INS information and financial management
systems are in enabling the tracking and reporting of acquisition data and
facilitating strategic decisionmaking, we attended demonstrations of INS*s
Intelligent Procurement (IPRO) and Federal Financial Management systems.
We analyzed the spreadsheets and reports used by the administrative
centers to track their procurement activity. We interviewed IPRO systems
administrators at headquarters and each of the administrative centers, as
well as officials from Customs Service and the Coast Guard to gauge their
use of IPRO and to determine if their experience with the system was
similar to INS*s. We also reviewed our previous best practices work
dealing with information systems and strategic tracking and reporting of
acquisition data.

To assess INS*s effectiveness in recruiting, training, and retaining its
acquisition workforce, we interviewed contracting and human resource
officials at headquarters and the three administrative centers. We
analyzed INS*s processes and procedures for tracking acquisition workforce

training, reviewed training materials for all acquisition- related
training courses, and attended two headquarters- sponsored training
courses. We obtained and analyzed information on procurement vacancies and
hiring rates at headquarters and the administrative centers. In addition,
we

analyzed INS acquisition workforce information obtained from the Office of
Personnel Management*s Central Personnel Data File. To define the overall
acquisition workforce, we used the occupation codes included in Appendix
I: Scope and Methodology

Appendix I: Scope and Methodology Page 26 GAO- 03- 799 Contract Management
our report Federal Procurement: Spending and Workforce Trends,

GAO- 03- 443 (Apr. 30, 2003). These codes are listed in table 1. Table 1:
Acquisition Workforce Occupation Codes Occupation code Definition

246 Industrial relations 346 Logistics management 511 Auditing 1101
General business and industry 1102 Contracting

1103 Industrial property management 1104 Property disposal 1105 Purchasing
1106 Procurement clerical and technician 1150 Industrial specialist

1152 Production control 1910 Quality assurance 2003 Supply management 2010
Inventory management Source: OPM. To determine if INS has followed sound
contracting policies and

regulations, we reviewed 42 of 185 contracts on INS*s active contracts
list. 1 The contracts were selected using random sampling and included 18
headquarters and 24 administrative center contracts. The value of the
contracts ranged from $24,000 to $1.1 billion and represented procurements
for a variety of goods and services, including detention

facility services, information technology support, guard services,
ammunition, program management support, and data entry. Only one of the 42
contracts fell below the simplified acquisition threshold ($ 100,000). 2
We did not address the effectiveness of the contracts in terms of meeting

organizational requirements, but limited our review to the issues set
forth in appendix III. We held follow- on discussions with headquarters
and administrative center contracting officers to clarify issues and
discuss

1 INS*s active contracts list includes contracts valued at more than $100.
2 Government contracting personnel are allowed to use certain streamlined
procedures to buy goods and services up to the simplified acquisition
threshold of $100, 000 (and up to $5 million for commercial items).

Appendix I: Scope and Methodology Page 27 GAO- 03- 799 Contract Management
discrepancies noted in the files. Appendix IV lists the contracts we
reviewed.

We conducted our review from October 2002 through May 2003 in accordance
with generally accepted government auditing standards.

Appendix II: Comments from the Department of Homeland Security Page 28
GAO- 03- 799 Contract Management Appendix II: Comments from the Department

of Homeland Security

Appendix III: Contract File Review Criteria Page 29 GAO- 03- 799 Contract
Management Does contract file contain evidence that acquisition planning
was accomplished?

Does the service or product being acquired fall into categories exempt
from acquisition planning?

Does planning documentation address the issues required in FAR 7.105? Does
contract file contain evidence that market research was conducted? Is the
contract a Federal Supply Schedule buy?

Is the contract an order placed against an existing contract vehicle? Was
this a simplified acquisition? Were sources excluded before competition
was conducted? Was full and open competition used? If not competed, was
other than full and open competition justified in accordance with FAR
6.302?

Were small business requirements addressed? For example, was the contract
set aside for small business or was participation in the 8( a) program 1
considered?

Does the solicitation state all factors that will affect contract award
and their relative importance?

For contracts exceeding $100, 000, is past performance a factor for
evaluation?

1 The Small Business Administration*s 8( a) Business Development Program,
named for a section of the Small Business Act, is a business development
program created to help small disadvantaged businesses compete in the
American economy and access the federal procurement market. Appendix III:
Contract File Review Criteria

Acquisition Planning Market Research Competition

Small Business Contractor Evaluation/ Contract Award

Appendix III: Contract File Review Criteria Page 30 GAO- 03- 799 Contract
Management Does the contract file contain a rationale to support the
source selection decision?

Is the Contracting Officer*s Technical Representative identified in the
contract file?

Is a quality assurance surveillance plan in the file? Is there evidence
that surveillance of the contractor is being performed as stated in the
contract? If the contract value exceeds $100,000, is documentation of a
contractor performance evaluation contained in the file in accordance with
FAR 42.1502?

How many changes were issued subsequent to contract award? What were the
reasons for the changes? Contract Administration

Contract Modifications

Appendix IV: List of Active Contract Files Reviewed ($ 100 or More), as of
April 3, 2002

Page 31 GAO- 03- 799 Contract Management Contract # Contract title Total
contract value Headquarters contracts

COW- 7- C- 0011 Systemic Alien Verification for Entitlements (SAVE) system
$82,746,489 COW- O- A- 0075 E- form support 500,000 COW- O- C- 1517 Access
to fingerprint database 2,173,920 COW- 9- C- 0059 Computer- aided facility
management 695,228 COW- 2- P- 1072 Extended warranty- uninterruptible
power switch 24,500 COW- 9- C- 0013 Leased parking 320,256 COW- 2- A- 002*
Data entry 73,781,361 COW- 8- C- 0051 STARS Performance- CSC 1,042,012,160
COW- 8- C- 0049 STARS Performance- Lockheed Martin 935,560,889 COW- 8- C-
0052 STARS Performance- EDS 1,136,699,808 COW- O- A- 0022 Acquisition
Support- UTA 80,000,000 COW- O- A- 0023 Acquisition Support- Tessada
80,000,000 COW- 2- J- 0470 Entry/ Exit Program Mgmt. Spt. 3,369,524 COW-
O- C- 0063 Tunnel detection system - R& D 299,641 COW- 2- D- 1267 Drug
testing 500,000 COW- 2- A- 0008 Body Armor- Safariland 5,000,000 COW- 2-
A- 0007 Body Armor- PACA 5,000,000 COW- 2- A- 0078 Restructuring/
transition to DHS 3,900,000

Burlington administrative center contracts

ACB- OC- 0002 Newark Detention Facility $73,053,762 ACB- 2- C- 0005 Queens
Detention Facility 65,007,332 ACB- 9- C- 0005 Food service 619,014 ACB-
OC- 0013 Message switch 543,435 ACB- OC- 0006 Ammunition 10,404,891 ACB-
2- C- 0002 Guard services 1,422,608 ACB- 1- C- 0002 Food services
2,962,468 ACB- 2- P- 0759 Sub- machine guns 258, 249

Dallas administrative center contracts

ACD- 8- C- 0009 Laredo Detention Facility $40,647,128 ACD- 9- C- 0001
Houston Detention Facility 52,870,735 ACD- 2- C- 0009 Unarmed guard
service 46,242,666

Appendix IV: List of Active Contract Files Reviewed ($ 100 or More), as of
April 3, 2002

Appendix IV: List of Active Contract Files Reviewed ($ 100 or More), as of
April 3, 2002

Page 32 GAO- 03- 799 Contract Management Contract # Contract title Total
contract value

ACD- O- C- 0038 Janitorial services $295,439 ACD- 2- J- 0682 Mail
processing machine 134,615 COW- 1- C- 0070 Untrained dogs 1,775,000 ACD-
2- J- 0386 Data entry 190,594 ACD- O- J- 0345 Administrative support
253,112

Laguna administrative center contracts

ACL- 9- C- 0045 Design/ Build checkpoint $365,000 ACL- 1- C- 0005
Construction 2nd story addition 580,588 ACL- 9- K- 0006 Janitorial
services 274,729 ACL- O- C- 0002 Horseshoeing 193,495 ACL- 0- C- 0004
Boxed lunches 1,716,750 ACL- 6- C- 0003 Unarmed guard service 45,000,000
ACL- 8- K- 0011 Meals 2,308,605 ACL- O- C- 0001 San Diego Detention
Facility 134,711,980 Source: INS.

Appendix V: Warrant Authority of INS Contracting Officers Page 33 GAO- 03-
799 Contract Management The following levels of warrant authority are from
the INS Procurement

Career Management Handbook: Level I: Authority not to exceed $25,000 for
open market procurements, and $100,000 for orders against Federal Supply
Schedules, other FAR Part 8 required sources, and other existing, priced
federal contracts.

Level II: Authority not to exceed $100,000 for open market procurements,
and unlimited authority for delivery orders against Federal Supply
Schedules, other FAR Part 8 required sources, and other existing, priced
federal contracts.

Level III: Authority not to exceed $1, 000,000 for open market
procurements, and unlimited authority for delivery orders against Federal
Supply Schedules, other FAR Part 8 required sources, and other existing,
priced federal contracts. Level IV: Unlimited authority for open market
procurements and for

delivery orders from Federal Supply Schedules, other FAR Part 8 required
sources, and other existing, priced federal contracts. Appendix V: Warrant
Authority of INS

Contracting Officers

(120187)

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