integrated so closely, acquisition officials, in your case iraq, put their lives in jeopardy, too. and i think it's an important part both for the government and the contractors. because i think there are sacrifices being made. i need to acknowledge something that occurred yesterday that has nothing to do with this hearing, but the contractors program manager for the pentagon parking lot, everybody knows about it because traffic has been redirected, is a personal friend, he had a heart attack last night and died. he was 51 years old. i used to call him every morning, not a business because he had nothing to do with the work i was doing, but i would call him because i knew he had to get up and get to the pentagon by like 5:00 because of the way they do the arrangements to try to slow traffic. he's one of the most selfless, when you say he's a friend of mine, he's one of the three or

four people that i consider a personal friend. the most personal friends had grown up with him, and i want to acknowledge his contribution and his contribution of himself was contribution to the last thing i have to say, and then i will get on with it, i will take it from a serious blow to a lighter mode. i want to acknowledge mr. amey's magna cum laude at the baltimore law school. i think you all understand the staff understands they do a lottery, they each put a buck or something together and to try to predict how long it will be before professor tiefer mentions the university of baltimore law school. so whoever has the shortest tenure on that lottery is the winner, but we now have two distinguished alumni from there. our participants with the school. admiral gilbeau, i found your testimony, or your testimony, your statement very helpful in certain areas. you lay out that you begin using

cpars -- i want is a couple of weeks ago, but january 2011, 30 days. and is currently consider inputs for two logcap task orders for the period of performance, july '09, july 2010. you took the initiative, but then he went on, and there's a question about why did it take so long and want to ask that question, and i realize someone maybe should have come to you and you took the initiative. but then you say we've not been requested to input cpars for logcap iii or for contractors, and that's essentially the way it is arranged to help. it's very heavy, kbr their and dina floor where we are doing this in afghanistan. you have not been requested to input cpars for the two large programs and you continue to support the pco's request as you, but when you talk about army sustainment command are what we refer to as rock island, it's not something a financial

process, and if they're not asking you for your testimony, my question is, is why not? what's going on here that you had to finally take the initiative and they can say well, it's important what they can say, we do important input on the award fee, and i say you get input on the awardee but that's not the process. can you help us understand them and i'm a fan of dcma, totally. but, you know, my sense is it's wrong, you were asked in this late date, you had to take the initiative. why are you not being asked? >> yes, sir. first and foremost, it's not just me that made this finally happened. my team was working on it, and i was just in this particular case, i did provide a little bit of perhaps forcing function to get it working. i just had a meeting, actually the logcap aide who was held on

wednesday of this last week. and i sat down with the program office, without question, we all agreed that my organization shouldn't be putting in the performance reviews, performance information into cpars for logcap iv. now, logcap iii, the issue is, there's a little bit of a dual responsibility within a dcma, with our houston group and with my group. and we are working very closely with the houston group to ensure that we properly document past performance for even logcap iii is currently being executed. in iraq, we are starting to input data as well.

i want to say about, probably about 50% of the data that we've been asked now to -- >> let me stop you there. i commend the current initiatives and indirectly you have answered the question and i'm going to move on. which is, you have taken the initiative. it just seems to me wrong. .. >> mr. carroll, you're kind of stuck in the middle, and you said you were inherently middle.

you used word like they're marginally effective and they embrace the audits, and yet your report, like, you use this exduded party system, another epls, and you said two-thirds of the cases they didn't put in the data. and i guess they found religion, and you say they hadn't consistently used available, used available information. and it kind of fits the same theme that i'm trying to explore with admiral gilbeau. what the heck took so long? i mean, really, you know, this is about accountability, and the ig's doing their job and looking at it and bringing things, and the best you can say -- and i understand what you say is they embrace the audit. that means they they've told you everything's going to be okay, and we're inherently skeptical.

can you tell me what took so long for usaid to step to the plate and start asking the question, where are our contractors that aren't presently responsible? >> i can only speculate. based on what we've seen over the years, but i would say that they might describe the problem as staffing, as iraq and afghanistan were getting off the rerund there are tremendous implementing programs, and they weren't getting the adequate resources that were tracking as far as personnel and contracting officers and things like that. i would think they felt like that. i'm going to take a little bit, just a little bit of responsibility ourselves in that historically on our investigations we were reticent about sharing information with ongoing investigations until such time as it was complete, and it was referred to the department of justice for

prosecution, then simultaneously the agency would get it and be able to make a decision on suspension and department, and we've changed that philosophy now and, you know, i think that resulted in the aid case. i'm inherently skeptical because i work in the ig, and we're sort of pleased with what the agency's doing going forward. >> i understand. >> the decision to do the audit, actually, was based on our frustration with some referrals we made to the agency for suspension and debarment that they didn't act on and rather than continue to grind our teeth on that, we decided to find out what the problem was -- >> my time is up, but maybe i'll explore it a little more later. commissioner? >> thank you. we'll like to know sometime if you ever got responses as to why your recommendations were not made. and at this point we'll go to mr. green, commissioner green. >> thank you. again, let me welcome all of you and thank you for your service.

i'd like to follow up just very briefly, mr. carroll, with the line of questioning that commissioner think bow was --ty bow was following before he stopped. i, like you, am skeptical. i have watched aid's management for a number of years, and i think it in the one recommendation or the one finding -- and i commend the audit report, and i commend your boss' testimony a year or so later. i think it aired a lot of dirty linen that needed to be aired. but when we say usaid's decision making progress for suspension debarment, debarment actions contains flaws and constraints that prevent it from operating effectively, to me, that is senior management.

and my question to you, very quickly, is aid's leadership and others have now said we're going to fix this problem, don't worry about it. you're skeptical, i'm skeptical. what are you going to do, what is the ig office going to do to insure follow-up? >> well, what we're going to do in 2012 is do a follow-up audit on the process to see where they've come from then to now, and in addition to that in just working with them on a regular basis between our investigators and our auditors and the office of acquisition and assistance we'll just get inherently a sense of how they're moving forward. and, you know, to say again, i really do think under, under administrator shaw there has seemed to be a cultural shift in

contractor accountability. >> i hope so. thank you. all of you in one way or another in your opening statements talked about accountability, the fact it's important, that past performance is important, you take it seriously, but a fairly recent -- 2009 -- gao report indicated that 60% of contracting officers they called it, contracting personnel don't factor in past performance in the selection process. we all understand reasons for that. i mean, it can go back to, you know, the focus for a shorthanded contracting community is getting the next contract out, it's not necessarily closing out the old ones to include follow-up and

indicating past performance. there are objective factors that they feel are more important. sometimes they're reluctant to upset the apple cart with a contractor, particularly when there are few contractors that might be able to perform that mission. there's fear of protest and, very frankly, sometimes it's hard to separate the contract's fault from the government's fault. now, all that being said, is past performance important, and how do we fix it? admiral gilbeau? >> yes, sir. i'd like to say that i think we've come a long way in fixing it, and i think it is extremely important. and virtually everybody i've talked to over the last sex months since i've been in this

job understand the criticality of documenting and getting good past performance information. i believe continuing our efforts in improving the database, improving accessibility and improving the input is going to take us a long way in achieving the results that we all want which is giving the pco access to unfettered information that will show the true performance of contracts whether it's in a contingency environment or not. thank you. >> mr. carroll, any comment? >> from an ig perspective, we think it's huge. but that perspective comes from a real accountability perspective. we don't take into account that the agency still has to get the work done, and i'm not saying that's the reason why you should overlook contractor past performance. you absolutely should overlook contractor past performance.

but i would say that the past and the present could be two different thicks. -- things. and if these organizations based on our audits, investigates or -- investigations or whatever action taken, if their current situation reflects a change in attitude, change in focus, change in performance, then i wouldn't see why you wouldn't use a contractor going forward if they have made changes in their processes for accountability. >> i guess one of the things that bothers me, and i have difficulty coming to grips with is that if you hired somebody to paint the inside of your house and they tracked paint all over your carpet, you probably wouldn't hire them again. and you might even negotiate a price with them less than what you originally had agreed to. but that's money coming out of your pocket. what, what i'm concerned with,

one thing i'm concerned with is the fact that we may see this as just free money. it's coming out of some big treasury pot that doesn't really impact us. and so we don't treat these contractors the same way you would treat a contractor doing work in your house, for example. >> yes, and e i agree with that. -- and i agree with that. we're better consumers and shoppers in our personal lives, and i think -- than i think the overall federal government is. to answer your question, yes, it is very important. i'm going to add one on why now, it's because the dod ig came out with a report criticizing the databases back in 2008. gao followed it up in 2009. it's a topic of discussion now, and it wasn't before. how to fix it? i would say we need genuine evaluations. i've heard too many stories about grade inflation where you

give the lowest possible grade that avoids a protest or a complaint from a contractor, and timeliness and accuracy in that data that provides a genuine tool for a contracting officer, suspension debarment official, whoever it may be, the igs, you know, to have a genuine grade in front of them or at least factors in front of them that make them make better decisions preaward. >> thank you. one last point, not a question. another of my major concerns is we have gone through various hearings and written our reports, how do we maintain this? how do we maintain this interest that exists today, to whatever level it exists, how do we maintain that interest when we're no longer in iraq, we're no longer in afghanistan, we've disappeared? how do we, how do we do that? i don't want an answer, i just

want you to think about it, and i may come back in the second round and solicit your ideas. thank you. >> thank you, mr. green. mr. tiefer. >> thank you, mr. chairman. i just want to mention i've pointed out before that in the 2000s our co-chair, mr. think ball, was part of a leading group of auditors in the government who were trying to keep contractors like kbr accountable against major head winds. i don't think i fully understood what an uphill task that was until our preparation for today's hearing when i found that the past performance systems were closed. not just virtually closed, literally closed to entries of bad ratings for kbr performance.

it was like you were banging on a locked door, mr. chairman. and i congratulate you for your work. although i'm shocked to discover that gambling is going on in this place about my mentioning of the university of baltimore law school. now we all agree you'll menace it quickly -- mention it quickly. mr. amey, you're the custodian of the, the enormous database, unique cay that base about -- database about contractor misconduct, and i want to try to flesh out. we've heard the anonymous but gigantic figure of $280 billion in new contracts given out to contractors who have criminal convictions or civil judgments for things like fraud. and i want to, i want to ask you about what i would call the flagrant five, the five contractors i would ask you to

draw on your database for because your database is about all the contractors of the government, and we're interested in the ones that do wartime work in iraq and afghanistan. the first would naturally be kbr which you mentioned in many your, your testimony. what -- i don't want to use my whole time up just on them, but they have been sole sourced billions of dollars in if contracts in iraq in recent years. what's their record? >> we have approximately 23 instances of misconduct. i think it's actually 24 because i think there was a doj intervention in a civil false claims act last week which includes six government contract cases and eight guilty pleas. >> okay. another contractor that you mentioned in your testimony is agility which is renamed, used to be called public warehouse company.

now, they did get suspended. was that the end of their getting new contracts? >> no. that's the only instance that we have many our federal contractor misconduct base, but they have received two extensions that i'm aware of that currently go until august of 2011. so once again, despite the government holding them accountable, there's been, you know, an exception to the rule that they have been able to stay on the contract for another eight or ten months. >> i'm beginning to get the picture that bad performance can be good business. let's go on to louis bear jay or -- louis berger. i want to stay with you with. i know that this book just this past december, there is a criminal conviction of their chief financial officer, a

criminal conviction of their controller. the company -- not just individuals somewhere down in the ranks, but the company was falsifying its cost-plus contracting which strikes at the very heart of what we employ these contractors in theater to do. what do you have on them? >> nothing. unfortunately, they are not one of the top 100 government contractors, and through the years we've expanded that because people have jumped in and out of the top 100, so we have about 150, and they're not in our list. >> well, let me ask, the noteworthy feature is they were not suspended because they did a guilty plea, technically called a deferred prosecution agreement. what do you think about a company which has, basically, pleads guilty to felony-level charges not getting suspended? >> oh, they would be in our database if they had criteria. the deferred prosecution is a problem was you're weighing the department of justice and what they're doing to punish a

company against what a suspension and debarment officer may do to protect the taxpayers from from awarding future contracts to that contractor. so they're supposed to be different animals, but the problem is in that case i would say somebody that entered a deferred prosecution, i think some length of a suspension to make sure that they have all their systems in place, have improved their management and their culture is needed. >> indeed. let me, a fourth company is familiar to the commission. we actually had a hearing which somewhat concerned it, and it was a witness at that hearing. as we went into at that time, they had a manager who was convicted felony level for a kickback-related offenses in kuwait and iraq. their witness was still not cooperating with us, the dcaa, the company's still not cooperating with us, they still will not provide the records for

us to find out whether the company was paying for the kickbacks or the manager was just doing it out of the company's spirit from his own resources. although you can understand why one would have been interested in looking at the company books. what do you think about a contractor like that mymy who has gone on to receive lucrative contracts? >> again, it's not in our database. kickbacks is a problem. the -- it's often excused with one bad apple theory, but at that point you need to still look at overall corporate culture. i'm probably more concerned by the latter part of your comment, and that is that they didn't -- aren't cooperating with dcaa or this commission in providing information as a government contractor. i would probably consider them nonresponsible, and at that point they shouldn't be eligible for contracts whether it's a suspension, debarment or a de facto suspension in the fact that that should be something that's taken a look at during an award decision. >> i, i can't -- i remember our

frustration when they wouldn't give us the records. the fifth on my flagrant five list is the first kuwaiti company, a construction company which became famous or infamous for its work on the new embassy for the united states in baghdad. are you, are you at all -- does it ring any bells with you? >> well, it does. again, they're not in pogo's contractor database, but i have seen issues at the embassy and, therefore -- that would be something that would get entered into our database if they met the criteria because we do include investigative findings in trying to present a full, complete track record of the companies that are doing business with the government. >> well, the specifics of -- you mentioned the inspector general report at the state department who found that they owe the

united states $132 million for their embassy work, that's how bad it was. yet they are still receiving new construction work. they were in the news receiving something for us in saudi arabia. do you think that should be made difficult for them? >> i would say so, yes. that and being deliberate on your -- delinquent on your taxes, if people owe the federal government money, i would think the government would think twice before they do business with them. >> thank you. >> thank you, mr. tiefer, commissioner tiefer. commissioner henke. >> thank you, mr. chairman. thank all of our witnesses for being here today. you know, mr. amey, i'm looking at your statement, and it's probably one of the clearest i've seen in a long time, and i thank you for that. there are some points i want to highlight while the staff puts up a board here that i'll talk about later. your statement makes a very clear accusation, i guess, that the federal government, quoting, the federal government is shirking its responsibility to

protect its constituents. and later in your statement you say the suspension and debarment system is riddled with problems and, as a result, speed and convenience frequently trump accountability and oversight. those are all from your statement, mr. amey? is. >> yes, sir. >> of course, you still stand by them? >> yes, sir. >> another quos on page 5 of your -- quote on page 5 of your testimony is this: government officials who are making a decision about contracting are at a disadvantage because they do not have the time to sufficiently assess a contractor's history of performance and responsibility. they do not have the time to sufficiently assess a contractor's responsibility? i would make the observation if they don't have the time to do it, they don't have the time to make that contract. would you react to that? >> i would, i would agree. unfortunately, the work force has been stretched thin, you know, if you had a list of the amount in this contract dollars that have been awarded through

the years and the level of the acquisition work force through the years, you know, like there's a big difference between those two lines on the line chart. >> dramatic difference. >> dramatic difference. you have, you know, two wars going on, so at that point speed, you know, who wants to be the person that slows down the process and is blamed for that. >> right. >> so those two things go hand in hand, you know? the government needed things yesterday. >> right. >> and at that point you don't want to be the one, well, hold on, check all the boxes and give a true, genuine assessment of responsibility because at that point, you know, some service or good is needed in the field. >> i'd like to ask each of the witnesses, it seems to me that accountability mechanisms that past performance, tools, rigorous performance evaluations, active suspension debarments, active oversight by both the contracting community and the ig community is important in peacetime, but it's doubly important in wartime.

we're moving faster, we're spendinmoney faster, we're trying to get things done more quickly. there's a lot more risk. just a quick yes or no from each of you. would you agree that these accountability tools are more important or less important in wartime? admiral gilbeau? >> i think it's important in wartime and in peacetime because -- >> is it more important in wartime when you're on cost-plus contracts and you're trying to spend billions of dollars quickly? >> yes. >> mr. carroll? >> i'd say the same, yes. >> captain harrington? >> yes, i would. >> mr. amey? >> yes, and not only because of mission accomplishment, but also lives are at risk right now. if you're buying defective weapons or, you know, there's a product substitution case, you know, you could be putting, you know, u.s. men and women in, you know, at risk. >> now, it seems to me with regards to past performance you need three things. you need to have the reports in the system, you've got to have

input, they've got to be well written, they have to be quality reports, and then later on someone has to use them. the point isn't to collect the information and put it in a file, the point is to use it later to make better decisions. would you all agree with that? i think the witnesses are indicating they yee with that -- agree with that. so the point is to use this information, but first you have to have it in the system. second, it has to be good information that you can act on. and number three, you have to use it going forward as a discriminator on whether you use that contractor again. our staff took a look at, the chart here, we created this chart working with the detention department and captain harrington's office. we took a look at just 2009 and just three agencies. from are our analysis -- from our analysis we can tell that the first column -- the middle column, rather, those are the

number of contract actions cut by that agency in 2009. 1485 for dod, 93 for state and 81 for usaid. and the contracting data system automatically sends something over to the past performance system to know it's out there. we could not find any reports for state department performance reports, for state department or usaid. zero. and we found less than 10% compliance at dod. so we're cutting 1485 contracts, and this is -- we put it back in '09 to give it some distance. by now those should have had at least one evaluation cycle, and we found fewer than 10% of those contracts had a report in the past performance database. so i would make the statement here that with these kind of results, everyone's convinced it's important. everyone says it's important, we have to do better, we have to

do -- and,, mr. amey, e i get it about the work force. they're some of the most overworked people out there. i get it. they need to be a larger, more deployable work force. but until we start having meaningful outcomes, there's no point in doing it. we can have meetings, we can set up committees, we can set up task forces, but until we start moving the meter on having useful reports -- and i'm not even talking about quality reports here or using the reports, i'm just talking about step number one which is put reports in the database, okay? can you react to this chart, admiral gilbeau, each of you, please? >> yes, sir. obviously, i can't substantiate the numbers or anything there, but i agree with what you just said in that you have to be able to use the information before there will be a self-impetus to put it in, not just a driven requirement to put it in. >> right. >> and i think we've come a long

way to getting that repository accessible and usable. we've got a long way to go, but the key is having a capability to deliver a finished product at the end -- >> okay. >> -- so that we can, the time we invest will be worthwhile. >> mr. carroll? >> we didn't specifically look at the system on our 2009 audit. >> right. >> but based on this information we will, clearly, include it in the audit we do on the follow-up. >> okay. mr. harrington? captain harrington, excuse me. >> yes. my office did compile this data, it was taken from fbds, and we used it and provided that information. i would tell you that from the assistant administration side and what we do since 2008 over 16,000 people have been trained on -- [inaudible] >> okay. mr. amey? >> two words: mission failure.

less than 10%, they're not performing their mission. >> commissioner, can i -- >> sure. >> i have a question, captain harrington, right on that line which is you said you provided that information. it shows gaps, and we all acknowledge an issue. who did you provide it to, and when you say provided it, who do you provide it to? >> sir, we provided that information to osd, tnl, and i do not conduct any analysis on it. we just provided the information. we did the data mining. >> so you're not aware of what they -- you're not aware of how they've used this data in the present mode? >> no, sir. >> okay. >> captain harrington, what i think we're getting at here is that your system allows the users, dod, the agencies, contracting offices to do this analysis themselves. is that accurate? they could, they could look at this and say i've got 20 things in fdps and i've got zero things in cpars.

>> currently upon request from each agency we will provide this data to them. in the future there's an initiative out there, april 15th, they'll be able to pull this off the web site. >> and, in fact, when you told us that you -- your staff in working up this hearing, you told us you prepopulate the database. you take the contracting database, and you send it into the performance database, and you open up reports which is why we can get this kind of data. so you're making it easy to do this, and you're providing a lot of training. >> yes, sir. >> okay. mr. amey, you put it well. you said mission failure, we're not doing it, we don't take it seriously. would you react to this characterization? there's no real accountability, and it's business as usual. >> i would agree. i'm hoping that based on these reports and attention like today's hearing provides the issue that it will improve, but i'm skeptical. you know, why has it taken this long? we were $200 billion in

contracts two years ago, now we're over $500 billion. >> thank you. i'm out of time. >> thank you, commissioner henke. commissioner, dr. zackon. >> thanks very much, mr. co-chairman. first of all, to the folks in the government, thank you for your service, and to mr. amey, thank you for yours too. and if you're associated with my colleague here to my left, so much the better for you. i'm also concerned with implementation and with measuring implementation. i haven't heard very much about measuring implementation maybe because there isn't much to begin with as commissioner henke just said. it reminds me of the agencies that gave their sesers 90% better than average. think about that for a second. so you have great inflation when you enter grades at all, then nobody seems to pay attention to the grades anyway. i'm struck, admiral gilbeau,

could you clarify for me, you guys in dcma have the ability to furnish information for cpars, correct? >> in some instances, yes, sir. >> do you provide that information 100% of the time when you do have the information? >> we would provide it -- we are suppose today provide it 100% of the time when asked to do it. >> why don't you -- i mean, i was in government on both sides of the river, actually. people take the initiative. after ten years in afghanistan, why do you not see the need given that you have the information to provide it as a matter of course all the time? >> again, it's not a matter of my personal opinion not thinking that we -- >> no, no, no, i'm asking you as direct -- in your capacity. if dcma has the information -- >> yes, sir. >> -- why wait, given what you've heard? and this isn't exactly new news. after all's been said and done

there's been aid reports, pogo's been driving the government crazy. why after all these years you do not feel the absolute imperative to provide every ounce of information available to you whether it was requested or not? >> yes, sir. i would respond by saying i do feel that imperative. however, there is policy that exists that we are actually currently reviewing to see if we can change that limits our ability to input that data. >> what kind of policy, could you specify, please, and who made the policy, and when was it made? >> i don't know when it was made. i'm -- and i believe it is a local policy, either dcma or perhaps dod, and i'm not positive there. >> you mean you're a senior official at dcma, and you don't know if you've made policy? is that what you're telling me? >> nono, sir, i would know if i made policy. >> i know you personally, but you wouldn't know whether it was

the deputy secretary or whoever on something as important as this where lives and taxpayer dollars are both at stake? >> at this point, yes, sir. it -- caveat to say the policy exists. it's -- i have a dcma policy on it, and we're researching it to insure we can follow the string to make sure we can make appropriate changes to put the proper emphasis on filling. >> i don't get it. when i was in government and if my shop had made a policy and i wanted to change the policy, the policy was changed. it was as simple as that. that's what senior government positions are all about. and to somehow, i mean, this is, this is the classic passive verb form. mistakes were made. who made 'em? god knows. maybe god made 'em. but i that is just, to me, a totally unsatisfactory answer, with respect. let me ask you something else, and i'd like to ask mr. amey as well. the contingency contracting handbook says that cpars is too complex and too time consuming

for contingencies. now, i've been a contractor about half my professional life, the other half i was in government. i'm no longer either. and i've seen cpars. they're no more nor less complex than any other government document. they're no more come mention than an oer, for example. -- complex than an oer, for example. so why isn't it time consuming, why isn't it mandatory even in contingency environments? why -- what's the logic behind this, admiral gilbeau? >> yes, sir. as of two months ago, again, when per the policy that we were just discussing, when we are asked to do it, it is required that my folk put it in. now, i can tell you because of bandwidth issues and sometimes connectivity issues it is sometimes difficult, and we are working to try to figure mechanisms where it's just inputting on a spread sheet that we can get access, we're working those issues.

but there are some technological problems that we're trying to overcome. >> well, and by the way, i'm not picking on you because you're you. whoever was sitting there would get this from me. i mean, it comes from the territory as i learned to my regret when i used to have to testify. but i've got to ask you, you say connectivity problems? i mean, come on, let's be specific. what is the problem, how long has it been, why hasn't it been rectified? give me some details, please. >> i can't tell you how long the problem's been going on. i'd assume it's been going on the whole time we've been in this contingency environment. example would be if you're sitting on fob fenty and you don't have a good signal to connect, and you're trying to put in the data, you're not going to put it in. and in some cases if you're sitting in kabul, it is easy, and we are doing it. but i can't tell you that i -- my organization can do it 100 president of the time -- 100 % of the time because of issues like that.

>> would you say when it has been easy you've done it 100 president of the time? >> i can tell you since january we've done it 100% of the time period in afghanistan and 50% of the time in iraq. >> and when can we expect to see it 100% of the time in iraq, sir? >> i don't have an exact answer, but as soon as humanly possible, i can tell you that. >> okay. mr. amey, i'd like your comments on my minor outburst here. >> i think it boils down to this type of work has been considered red tape. i think this is the kind of, you know, it's been a procedural burden, and that's kind of the reputation it has, and at that point this is the kind of work that's being gutted out of the system. both from a preawards side of thing, a contract administration and oversight side of things that has been gutted from the system that makes it a lot more difficult to hold contractors accountable. and also agencies accountable. >> okay, thank you. mr. carroll, i have a very special sympathy for igs. they worked very closely with me

when i was in government. you mentioned in your testimony that there were four entities omitted from the excluded parties' list. who were they? and let me ask you since your team is checking on this, who were they, did they get new contracts, are they still contractors, and what was done as follow-up? and maybe if you don't have that now, perhaps you can get back to me on the second round on that one. whatever's easier for you. >> probably on the second round. >> okay. then one last question. you say that there have been 28 suspensions and debarment l actions over the past year with aid. now, aid in particular strikes me given that it's been an organization that's relied heavily on contracting for at least a decade, the improvement is late, o put it mildly. -- to

put it mildly. but just as here you see up there how many actions are we talking about? 28 suspensions, debarment out of how many cases? could you tell me that, please? >> out of how many cases as in -- >> as in number of contractors. is the number there, the 81 that's up on that chart or what? what's the base when you say 28? 28 out of how many? >> i couldn't say specifically. i'll get back -- i'll get you the information, but the point i was trying to make was the improvement and just because there's a contract, a number of contracts doesn't mean ha they're poorly performing or there's fraud or criminality. >> oh, absolutely, i couldn't agree more, but there's no way of knowing that if you don't complete a report as commissioner henke said. you know, you've got to start at stage one, and it just seems to me to say we're doing better or that we're doing anything at all is very difficult when you don't have reports completed.

and i think part of the difficulty that at least i find with so much of the testimony i'm hearing and that i've read is that everything's about process and very little is about outcome. and government is great at process. in fact, government is best at defending whatever it does or doesn't do as opposed to actually dealing with what the outcomes ought to be. thank you. >> thank you, dr. zakheim. sometimes when something is so outrageous, it has less impact. because it's hard to get your, your mind around it. so admittedly, it's just a sampling, but in our statement, our joint statement -- and, by the way, republicans and democrats up here, we hardly remember who's who, and sometimes our biggest disagreements are with staff and not among ourselves. and it's a healthy disagreement. we have a lot of practitioners

who sometimes say, yes, but, you know, we're in the system, we know how it works. the whole reason why it's good we're not in the system is we can look at it from the outside. so if you were the general public and you are aware that samplings of contingency contracting data in the federal procurement system suggests that more than 90% of contracts have not had required past performance data entered and then you're in the general public and say, well, if 90% haven't been entered, how in the heck can you judge them on past performance? and then, admittedly, it's a different sample base, but the office of federal procurement policy has found more than 75% of past performance reports that were made still lack adequate narratives on contractor cost-control efforts. so is it because you're in the system and you all make excuses and you understand, well, the people are overworked? what is it that's going on in

government that accepts this for, literally, decades? and, and doesn't do anything about it? admiral, explain to me why, why this is happening. because to the outside and to us it's really outrageous. >> yes, sir. and i can see where especially given some of the testimony given here it could seem outrageous. one of the problems that i think we are well on our way to fixing is, again, in my environment as dcma i provide that past performance data, and i do this routinely, not just the cpars piece, to the procurement contracting officers, to the pcos and to the program offices. the way our policy that i was discussing currently lays out the pcos are the ones that are responsible to put in that performance data. in some instances i'm probably the closest, my organization is

the closest to observing and surveying the contract performance, and that's why we've changed recently to have us put directly into cpars. so i think some of it is the way the system was developed, and i believe the people that developed the system previous to us did a good job putting something out there, but we need to make it better. >> well, what it describes, the fact that you used the word seem is distressing was -- because it doesn't seem outrageous, it is outrageous. that's the bottom line, that's the whole point. mr. carroll? the question is, this is so outrageous, what do you hear within the system that kind of justifies the fact that this can exist as outrageous as it is? >> well, from are our point of view, chairman shays, we don't accept it, and while we did the audit and we're going to continue -- >> what kind of excuses do you hear? give me one or two of the top

two excuses why this didn't happensome. >> it's going to be staff. >> yeah. captain? >> sir, in my environment i provide the data, and we provide that user training. >> when you provide the data, the data, do you begin to think, like, what's the point? because you've been providing the data, and nothing's been happening. >> where well, the programs -- well, the programs, cpars has been a program, federal program since october. i don't do any analysis of it, no. >> okay. mr. amey? >> i think this is why your 23rd recommendation in your report you released last week that talks about a written rationale for not pursuing proposed suspension and debarment is vital. we've seen multiple instances in just using contingency operations, kbr had over a billion dollars of unsupported costs. i'm not claiming that was all waste, fraud or abuse, but we couldn't support them, so we're not sure how money was spent.

well, you know, the dca wanted to take some moves, wanted to initiate a withhold, and they backed down from the department of defense. we have seen it with bp as a contractor. everybody, obviously, knows their record in the gulf coast, but they, obviously, supply a lot of petroleum to the air force. >> yeah. one of the challenges we have is since so many people have their finger on it, nobody's ultimately held accountable, so no one gets blamed. ibm has this wonderful system that even once someone's retired, they look at a successful program, and if it's successful, they go back to the retiree and give them a bonus of hundreds of thousands of dollars for a decision they made. there's this sense of accountability even that follows you once you retire. recommendation one allows contractor to respond but not appeal agency performance assessment. do you gentlemen understand why we made this recommendation? can one of the four of you explain what the logic is behind this?

it's pretty logical. i'm just curious if you think about it. it's one of the things that we encountered. allow contractors to respond to but not appeal agency performance. assessments. what's the problem with the appeal? >> well, i'll jump in. >> sure. >> did response alter -- you know, the decision should come from a government agent, not from discussion with the government or with a contractor. >> and the appeal can take months, maybe a year, and you're held in limbo, and yet you're in a contingency environment? we relate this to contingency environment. you have to have a decision made soon enough. align past assessment with contractor proposals. we want to make sure that a contractor isn't claiming that they did something well when, in fact, they didn't, and be there's no counterrecord to contradict it. what's the sense of this? why would we want to suggest

this? could any of you tell us why? do you think about it? admiral? >> yes, sir. i just think it makes common sense, and i agree with that recommendation. >> and if -- thank you. and it holds people accountable. just let me go through the few others. require a written ration male for not pursuing a proposed suggestion or debarment. this was a question that i wanted hanging for you, mr. carroll. i don't understand how we could see an agency -- we don't, the commission -- without a justification for not agreeing to a recommendation of being disbarred or suspended. >> well, we, we present the evidence to the agency to make a suspension and debarment decision. sometimes that's in parallel with the referral to -- >> and dcaa sometimes does the same, and -- >> yeah. >> and then they still get the

award, and there's nothing written that explains why the recommendation notwithstanding was still decided. >> true. >> do you agree with that recommendation? >> whole heartedly. >> captain harrington, can you, can you speak to this recommendation and whether you agree to it or not or think it makes sense? >> if i could ask you to repeat the question, sir. >> our recommendation 23 is require a written rationale for not pursuing a proposed suspension or debarment when it's been recommended by an inspector general or recommended by dcaa. or -- >> or senior employee of that organization. >> or a senior employee of that organization. >> sir, in my capacity i think that if there are programming changes or inputs or things that need to be changed to the system, i will be able to provide that. our -- >> i hear you, captain. admiral, could you speak to that recommendation? whether there should be some kind of written -- not some kind, a written rationale for

not pursuing a proposed suspension or debarment when it's recommended. >> yes, sir. my interaction with suspension and debarment is extremely limited. from what i do know, personally, my own opinion is i think it's a good recommendation. i think it's something that should be taken forward. but, again, i am not in the suspension or debarment officer realm. >> okay. well, let me just say i'll read the other two, and my time is up -- >> chairman. >> but we want an increased use in suspension and debarments. we think if you're not going to be suspended or debarred, there's no accountability. it's what's the point of even recording past performance if you don't, don't act on it? and revise regulations to lower procedural barriers to contingency suspensions and debarment. we just think that the process in a wartime environment is absurd if process can take literally years. then what's the point? and, you know, we waste money,

we get bad performance, and we put our men and women who are on the front line in danger. so we really want you all to go back and look at these recommendations because we think this is an important, essential part of what needs to take place in the reforms. and we're going to start the next order o, and we'll go to you for five minutes, commissioner thibau lurk t. >> thank you, commissioner shays. i want to explore something that commissioner shays read very briefly and just get a yes or a no. there's a recommendation, i think, we're popping numbers, number 22 that says agencies certify, require agencies to certify the use of past performance database. require agencies to certify the use. does anyone on, up there think that that's without merit? all right. well, it seems to me then that the next part of that is the

accountability that commissioner shays brought up which is if you do that, right now it's a whole lot of -- and we're doing it, it's in the testimony, well, we're doing this to improve it -- but there's none of this, here's where the failure occurred or senior management accountability. well, if you require the agencies to certify that they're effectively using it consistent with the requirements and the regulations, then at least you can evaluate the process that they're using. but if as you see in the chart there you get all those zeros or less than so %, you've -- 10%, you've got nothing to evaluate. so it would seem to me if you implemented that, you could turn to the head of agencies in forums like this and say, what's going on? and it seems to me then there would be a scrambling on the side of the government to get this done the way we all would like to. is anybody up there disagreeing with what i've said so far? okay, now let me get to a point

that's sort of near and dear to me that i wanted to bring up which is the cost of these corrective action plans and the suspension and debarment work too. many of these contractors that have that we bring up, i like professor tiefer's flagrant five. i found that a good way to reinforce it, but many of them that we bring up are valued providers of certain goods and services. so people in a government make a decision, you know, and we can criticize it in some cases, and we are. we need to continue their support. but it seems to me that the question that hasn't been asked is, so, who's going to pay for this? in the example of -- or who should pay for this? i'm going to start with mr. amey and work my way down, but in a most egregious example, clearest understood example where there was life lost in this electrical problem where we were wiring living quarters and other quarters inappropriately.

well, in that particular case we, the government, devised all sorts of project safety-type situations where it was all fixed. it's a cost-type contract. it's not. if it was a fixed-price contract and a contractor agreed to perform against a certain standard and didn't and you put a cost improvement program, corrective action plan together and they had to do it, guess who pays for it? the company pays for it if government's been doing their job and documenting. in a cost type, we have been out in the field and gone through a lot of these in the semi-remote, the shanks and airbornes of the world, you know, we've been to them. there they want a plan and a responsible contractor will fix it. but if it's egregious and they didn't build a building so it couldn't be inhabited, the real question is why in that environment do we continue, you know, should we be changing the regulation that if it's worthy of a level three corrective

action plan or however we're referring to it, who should pay there are this? and we're changing the regulation on business systems saying you take a withholding until they get it done. and i'd go a step further and say ask the question, you take this withholding, it's that important on a corrective action plan also, and then the question is, who pays for it, mr. amey? who should -- you know, when you get right down to the business world that we're try to be like, who should pay for that? >> obviously, it should be the contractors to either provide the goods or services that were promised to an adequate level based on the requirements of the contract, but, unfortunately, i think most of the time the taxpayer pays for it. >> okay. captain harrington? do you have anything different? >> from where i sit for funding, i look at the system, and i am funded -- >> so you're a user of the system, and it's not really down your lane. mr. carroll? you've got a usaid contractor that's failed. you've got a bunch of money

being spent. it's an irreversible contract. right now we're paying for it. should we be considering a change in either the regulation or the law that requires that where it's egregious, you know, they're going to continue to do business. they've made all these fixes, but who's going to pay for the fix? >> i agree with you 100% on what you're proposing, and i would just say two things. for the agency, for example, to fix that they're going to put eight fte into a new unit, so you've got to give them credit for that. secondly, i know mr. tiefer is a fan of lbg, but they are paying for their corrective actions, you know, civil settlement -- >> part of their justice settlement all of the corrective action plans? >> we, exactly. >> and justice can do that, and they've done it. kind of rare, but they've done it. all of my history which makes me older than all of you, justice effectively does that sometimes. they don't always do it in this

case. >> right. and in addition to that where we find egregious instances where contractors didn't perform, we'll make a recommendation to the agency that they can't sustain that cost and to recover the cost. so it's the contractor, clearly. >> yes, sir. admiral? >> i would always say contractors have equitable adjustment capability against the government, i would love to see a law that would allow us to have equitable adjustment. >> well, i think that would maybe -- my instant reaction is to agree, but i would say that would be contradictory and very difficult. but the concept of simply saying in the regulation that if a corrective action plan at a certain level, the contracting have the authority with the advice of his or her advisers to say to the company, that's one you're paying for. because i think then the company will be more attentive, and i think the government will be more attentive as long as you have agencies certifying the proper use of past performance

database. because then the head of the agency is going to have to put his reputation or her reputation on the line. mr. amey, you have a quick comment? >> and then we need to move on. >> yes, sir. this kind of gets into the weeds, but it may also be on the competition side is that you need a competitive multi-award idiq so if that contractor isn't performing well, then you can turn somewhere else, someone has already been preapproved, so at that point you could bring them in, and there's that threat you could lose that contract. that may be a remedy. >> good point. good point. >> thank you, my co-chair. we'll now go to mr. green. >> thank you. not, not really the focus specifically of this hearing, but my closing comment in the first round now that you've all had time to think about it, and i'd like to take advantage whenever we get some smart folks up here to sort of pick their brain. you know, commissions like ours just come and go. and some do good work, some

don't do terribly useful work. i hope that some of the things that we have done over the past couple years before we close out will prove to be useful. unfortunately, many of the recommendations just die a slow death. so back to my earlier comment. the war's over, the troops come home, they're focusing on training, they're focusing on maintenance, they're focusing on exercises. senior osb leadership goes away. joint staff turns over. senior service leadership goes away. cigar goes away, we go away, you guys maybe all go away except igs survive forever. what would you do if you were king to insure that the progress that i think we've made -- and i think you all agree there's been

progress made -- what do we do to insure that that lives? anybody? >> sir, i'll take it first. >> i want to ask all of you. >> yes, sir. i think i would say that you'd have to insure that we institutionalize the operationallization of these sorts of things, and we need to drive it just into our culture, and we also need to make sure there's a proper metric that is agreed to and corinne into the -- driven into the process. it's, it will be difficult to keep track of these things. i'm sure that there were same instances of this in the vietnam era, and we're looking at it again now. so the key is how do we institutionalize it, and that's something that we have to take a focus on. >> in your area do you see it being institutionalized, whatever that means? >> yes, sir. i do. i see -- we are writing sops, we are measuring, we are insuring that it gets into our

culture. >> mr. carroll? >> well, i would say it's incumbent upon the igs, as you stated, to maintain the momentum and to continue holding the agencies accountable for contractor performance. and i think that's, you know, even when the special igs go away you still have the statutory igs for defense department, state and aid to be able to carry the torch forward. so i would say from my point of view we're fully prepared to continue doing what we do to make sure the agency holds contractors accountable. >> well, i think the pressure will come on the igs, and i hope that when the special igs go away, if they do, and whatever, whatever form follows them, if any, they will also have certain responsibilities. but short of that and short of really taking that seriously,

i'm skeptical as all of you have seen recommendations, studies just collect dust. and i think that some important work has been done here, and i think we're moving in the right direction. but we've got to, we've gotta stick with it. captain harrington. ..

>> unfortunately, or fortunately, administradministration and policy policymakers go a >> unfortunately, or fortunately, administradministration and policy policymakers go away as well so i think you need to codify this, get congress to pass legislation that will enhance what's currently in the federal acquisition regulation as well as the dfar. i wouldn't expect it just to come from the management side of things with policy memos. >> thank you. my time is up. >> thank you, commissioner green. mr. tiefer. >> thank you, mr. chairman. i'm going to go back to a couple of my favorites among the flagrant five, and ask admiral gilbeau, i know that you carefully said in your statement

that as far as logcap iii and logcap iv, enormous logistical contracts in iraq and afghanistan, there had not been entries made by dcma. i'm not talking about currently, i'm going back and kill the reason ask made by dcma, i want to take it one step further and ask about that. our staff look to see whether somebody else made entries and found that there had been no entry for kbr in logcap iii or logcap iv, which means the expenses history described that you could describe on the pogo database doesn't have anything corresponding in a government database. and i want to ask, how could this have been true, or why would this have been true in the most what i think is the most famous incident of kbr wrongdoing, which was at the

electrocutions in iraq, the electrocutions of soldiers and others because of faulty work on the wiring. and i think you at dcma did yeoman's work, you establish a thing called a level three core active action which is a very serious sanction. why didn't get -- why didn't i get into the database? >> this would just be speculation but my guess is because of that handoff from the dcma activity to the procuring contracting organization, to give all that information in seven volumes, seven big volumes of information, and then the oversight trail from my perspective is suffered once i hand it over to the pco. >> thank you. i have a question about what i believe is a major game that the contract with bad performance

have succeeded at, and that we have a recommendation at, and that is, number one comic isn't it the case now that even if there is no for a contract in the database, there's no past performance entry, that a contractor may cite that work on the contract as past experience in seeking to be evaluated favorably for new contract where best value, 30% is often what they have done before. and if we recommended that that should not be the case, that contractors could only take credit for performance that has been rated, would that lead to a better rating system? >> i'm not sure. at the onset i think it sounds like a positive idea.

however, i would have to look at what kind of experience was being built, what kind expense did they have, when would they ask execute a contract and then be competing for another contract. >> but is the case now that contractor who does not have past performance leads into therefore may have given a poor or even unsatisfactory performance may cite as past experience, they can work on a contract? >> yes, sir. i can't get quality information as to the crankcase because i don't have pcos. i can say what i did manage pcos back in iraq in 2007-2008 timeframe, you are absolutely right. >> thank you. mr. carroll, your statement explained that you could build the case that a.i.d. ig had built case on louis berger to which they later pled guilty, and i've no criticism, only praise for the case that you bill. is an impressive accomplishment. i want to know, could earlier

on, not at the end when louis berger had taken a lot of measures and looking to make a plea agreement, but early on could you have made a recommendation for a.i.d. to consider suspension and debarment? >> i'm not sure that we could have because the fraud was so complex and so difficult to prove, it took us an extraordinary long time to conduct the investigation and then to write the affidavit alleges the indictment, that led to the civil settlement. so in retrospect, it wasn't nearly as easy as it was with add, where we had clear fraud early on and we present that to the agency. so would we have liked to have seen something more punitive with lpg from a law-enforcement

perspective? i think i could probably say inherently yes. but -- >> my time has expired. that's okay. >> i thank you, mr. tiefer. commissioner henke. >> thank you, mr. chairman. captain carrington, your offices is responsible providing past performance training on the systems you manage, right? >> yes, sir. >> and you provide, he said 16,000 users, different levels of training to provide the training, i guess you do site visits, youtube video telecom to? >> we do online training. if you're a registered user we do site and we do go to for instance, a perfect sample is next month we're going to be in huntsville, alabama, we expect to train up to five other people. >> you also hold past performance conferences. we sent some of our staff last year and they said it was pretty good. my question to you as you do a lot of training. you seem to produce a lot of steps, and a lot of access to

training. so with all that training going on, what do you attribute these kinds of results to? people are trained but not using the system. what's missing? >> we've taken -- we've listened to users, and we tailored our training to that, and we've provided in our training, those tools like i said earlier, the tools in the toolbox to the users, you know, for good example would be the narratives. we stress that and say you should do that all the way through the whole contract. >> so to what you attribute the kind of results when looking at here with 10% are completed or zero are completed? what's missing? is it a will to use the system? >> i'll be honest, sir, in my capacity i don't analyze that data. >> is a frustrating few to provide that training and see these kinds of results of? >> yes, sir. >> mr. amey come in your statement you mentioned

interagency suspension debarment committee. there's about 50 departments and agencies that have been around since 1985, six, whatever. there's a piece of law past two years ago that requires them to report to congress. it was passed in the end of 2008, have you seen the 2009 report? >> i haven't seen any of the reports. >> have you seen the 2010 report? >> no, sir. >> have been reported by law to congress? >> i don't know the answer to that question. >> have you asked them? what heavyset? >> i have written. i sent two letters multiple e-mails, and multiple voicemails, and have received no response. i take that back. i did receive one response from someone that was the former vice chair, she said she was no longer on the isdc, and, therefore, i had to take it up with mr. blalock. >> okay.

but you contacted in? >> i did but i never actually have spoken with them, but i have contacted him and i've never heard back from him. >> he is here today. he is on our second panel. if you would make a point to meet with mr. blalock after hitting to open up dialogue, i would like to introduce the two of you. >> thank you. >> mr. carroll come you said, you used the word on suspension and debarment deferrals, the ig's make to the procurement house, you said you were frankly quote frustrated that you are making referrals, but the agency wasn't acting on them. what happened to them? them? did they go into a blackhole? was there ever a revolution on them? >> well, to use your term and to the black hole, if we're not going to get a criminal prosecution, then it comes back administratively. we refer to the agency. the agency will take some

particular action. when they take that action they get back to us and we close the case. so it's not -- >> that action may be -- >> it could be they chose not to act. that could be one of the actions they took. >> and literally can agency we chose not to act? do they have to document for you? >> no. it's very informal like that. they really don't have to give us a rationale for why they chose not to act. >> okay. >> so your recommendation to force them to do that i think would be outstanding. >> the recommendation is that it would be approved by the agency head, so if you say this contractor is a bad actor, you should suspend of our debar them come if they disagree they got to run it up to the administrator or the secretary to get that level of visit -- level of visibility to it. >> i think it's an outstanding idea. >> admiral gilbeau, you said something i'm interested in pursuing. you said you're not in the suspension and debarment realm.

and i'm curious because dcma is the dod's lead agency on contract administration. >> yes, sir. we provide input to icann, the pco. i don't have any authorities to suspend our debar. i do provide input. i do provide surveillance entity provide some sort of oversight. >> thank you, commissioner henke. now we'll go to dr. zakheim. >> thank you, mr. chairman. first of all, mr. carroll you're going to get me some answers on those four entities. that were left out and whether they got any new contracts, whether they are still contractors. >> the four entities were related to one company, and i can't definitively as to whether they got follow-up contracts, but i will get back to for sure when we get back to the office. >> which company was that? >> it's called dan x.

>> i appreciate that. captain harrington, geoff twice in sag don't analyze the data. this is what you said about what your office does. you manage, you oversee. you do proper database management, configuration management, customer support and training. but if you don't analyze the outcome how do you know what you're supposed to be doing? could you tell me, please? >> we have an moaa through dla and osd. and we adhere to the moaa. the memorandum of agreement -- >> i know what that means. my folks take that very strictly. >> tell me, but you have a memorandum of agreement, but do you get specifics on the outcome of your training on whether you

have configured these, whether the systems are properly configured? you get numbers. do you get outcomes? >> we compile monthly metrics about the system, yes, sir. >> you do. so you have numbers and outcomes on all these systems, on all the training you're even -- you are able to evaluate how well you train people? somebody takes a course at the university, they're going to take a test. he will pass, fail, get great. and somebody takes what your training courses how do you know they weren't watching tv at the same time? >> do we have a formalized, formalized feedback system? >> yes. >> no, we do not. >> so, if i was taking a course and if it's a typical computer-based course, what happens is you get the question wrong, you try the question again and you can keep trying until you get it right.

so i could be watching the super bowl and taking your course, and finishing -- how long do these courses last by the way? each section of it. >> one day. spare and how long does it take what is it an eight hour course? >> its approximate eight hours. >> so i could be doing something else, and taking your course at the same time and you have no way of knowing whether i've absorbed any of this, correct? correct? >> yes, sir. >> are you come, without? >> sir, i think that there are areas that in my capacity that we are exploring to make the system better for customer feedback. i think that's an important aspect of it, and we are exploring that. >> can you give me details? we been doing this, we been at war and continues to now for 10 years. we may have other contingencies. give me examples of what you're doing, and also when you expect to have been done. because one of the things i noticed in government is -- all you guys, we are on, we're

working the problem, but nobody ever says when the problem will be work. so give me examples of what you're doing and giving a timetable of when you're going to complete whatever it is you're trying to do. do. >> sir, i think for that question i would like to take that for the record. >> that's fine. i will accept that. mr. amey, i want to point out a couple of things. first, this is more generally just an observation. this bad apples excuse whenever a contractor does something wrong to say well, it was some individual that did. but i can tell you what you get a bad cpars rating, everybody make sure that whoever messed it up is probably going to be kicked out pretty quickly. and so, the absence of a cpars rating is frankly and i think you are from all my colleagues, i think the word my kosher menus was outrageous. is probably an understatement. but let me ask you, mr. amey, have you or pogo generally

looked at or have any sense of the fact that possibly those who rate for cpars because some of the input comes from what's called in the business the client might then go over to work for the very contractor they rate? >> in messenger describing the revolving door? >> that's one way to put it. >> we have not in this context, a few years ago pogo did publish a report on the revolving door. we took a look at senior government officials that worked for the top 20, or that were former senior government officials, went to work for -- >> this is different because here we're talking about the gs 12, 13 our '04, '05 reader who is going to inflate the cpars, retired and then go to work for the very company that they have inflated. have you looked at that? and if not, i recommend you do.

>> i wish i could. i have not come and the reason being is we don't have the capability. there is a dvd kind of revolving door database that has been created but it's not publicly available and it does track certain contracting officials that move to the private sector. but we don't have access to that data. >> who would? does anybody on the panel know who's in charge of that so we could find out why there's no access? anybody on the panel know? thank you. >> i have one question before we allow you all to make a final statement without our responding to it. but i may have more than one question depending on your answer. i'd like to know what would be your number one recommendation, each of you, what would be your number one recommendation to make the past performance and contingency reporting system work more effectively?

and so, what would be your number one recommendation? it could be the ones where they come it could be other ones. but what is your number one recommendation to meet the system work better in a contingency environment. admiral gilbeau, let's start with you. >> yes, sir. i think my top recommendation would be to ensure there is a separation of reporting from the program office, and in my case, dcma, the contract management administrators. and i think ensuring that we are a programming resource, whether it is i.t. resource our personnel resource, input the performance data directly would be a good thing. >> thank you, admiral. mr. carroll? >> for me it is a tie between the certification of use of the systems and in providing a written rationale for decisions

made for suspension and a barber, yes or no. >> thank you. captain? >> the systems evolve, my office and my command is standing by to make those changes to keep it going forward and -- >> let me say you are too integrally involved in this not have an opinion of the best way to improve the system. and what i'm asking is for you to give us your best judgment. that's a request that people around you would expect you to answer. >> i know that the vjc cs that they are working to make it a little bit easier for the person in the field. so that would be your number one recommendation? >> yes, sir. >> mr. amey? >> i will defer to the other panelists. i think that they pointed out the top three or four issues as

far as the performance data. >> i would think that one of the most important things is that senior leaders focus on this as something that they want done. what i've noticed in my observations of military in particular is when the senior folks want it done, it gets done. and if they have other priorities, so i would think, frankly, that one of your answers might have been that it be given a priority over other things. this is the bottom line, and let me just make a comment. in our at what risk, our first report was at what cost. we have in five session. the contractors become the default option. this section two, agencies do not treat contingency contracting as a core function. the third is an agency

organization structures do not support contingency operations. the fourth is policies and practices hamper contingency competition. and the last one, section five, is enforcement policy and controls failed to ensure contractor accountability. all of us would stand by these headings and then the recommendations within it. so three of our recommendations came under policy and practices, as it relates to this issue. and then we had three in the enforcement policy and control scale. to ensure contractor accountability. so, the bottom line for me is and i think my colleagues come is that 90% of the past performance are basically ignored. give or take. may be more are ignored, maybe a little us. the second is contractors can claim good performance and does nothing to disputed because 90% is recorded. the third point is we focus on

the 10% where performance is recorded, and even then we don't use it. to ultimate suspend or debar or simply not move forward with that contractor, at least not give them as many points. maybe they should still be allowed to compete but not score as well. is a 30% past performance? >> yes. >> what a joke. 30% is past performance. the contractors as i'm doing great, so they get scored well. and we have no way to counter it. and then so, so we often renew contracts when performance is bad. we get new contracts to former bad performers. that's what happens. and we rarely use suspension or debarment. and it's not a punishment. it's just we don't want it to do the work. for existing a new contract. we basically ignore this

important tool. that's the bottom line of this hearing. and admiral, i just want to say to you that, and you know this but i just want to say it to you frankly, someone in your position, if this isn't the highest priority or one of the highest priorities, this is going to discontinue. and we really would respectfully ask that you all take a good look at this report. we spent frankly two years trying to sort this out, and these are our conclusions, and, frankly, they are very important conclusions. so i got to make the last statement on this side. you each get to make whatever statement you want without any intervention from any of us. and we will let you, admiral, coal last to get the last word and we will start with mr. amey. >> thank you very much, and i appreciate you holding this hearing because i do think it is critical to making government operations work better. my final statement would be just

three basic recommendations. one is transparency. when i include transparency i include government sharing. unfortunate i have been told by one suspension and debarment official if you know that contractor had entered into multiple administrative agreements with other agencies he wouldn't have been the next. expanding fapiis to include items that are related to contracts and grants. most of what we're talking about may not be entered into those databases and, therefore, isn't going to give us the push that we need when it comes to better contractor accountability measures. and also the increased use of suspension and debarment. we could have in the case of bp, i thought that the epa should have suspended bp. however, the air force came back and said no, no. , we decided we needed to participate and the question is to grant him a winner but let's hold him accountable. let's improve processes and let some shine some light on what

the track record is so, therefore, we can help them improve and help the federal government. thank you. >> thank you mr. amey. captain herington? >> mr. chairman, thank you very much for providing me the opportunity to sit and testify today. i do appreciate it. my command as we have, stands ready as we discussed provide the training, put those tools in the toolbox for our users of the systems. and standing by to evolve the systems to make it better for each and every one of us spent thank you, captain. mr. carroll? >> i appreciate everything the commission is doing and has done over the years. we are both in the oversight business, and whatever you can do to promote accountability helps us. many other recommendations will help us do our job, help us keep the agency accountable.

so we appreciate everything. we support everything you'd are doing going forward. >> thank you, mr. carroll. admiral? >> thank you commissioners. i would start to say that i believe this is on leadership's desk, at the very top of the things to do to improve oversight. i can tell you it's very important to my boss, mr. williams. i can tell you that a lot of interaction with the folks at dod, it is important. it's certainly very high on my list. i really think the committee for focusing on this, and it does allow us to get some direct answers to an issue that i think we need to get better on. i'll tell you right now, four months ago i couldn't give you a statistic on where my folks in afghanistan and iraq are with respect to how many contracts are requested to have data put

in. today, we are. we are measuring that. i can tell you in iraq and afghanistan this month, 100%, we will be properly annotated into the right system. so, we are effectively managing from the senior leadership at dcma, and i think things will improve. i will say i do think we have a ways to go to institutionalize it, and i would also like to say that i was very impressed at the logcap data data which allows report of major general fontaine, the asc commander, and mr. tommy marx, the new logcap program manager, we had to very for it and quite honestly good discussion as to how we can all work together to improve this process of ensuring prior past performances is properly taken into consideration for the future. thank you, sir. >> thank you, admiral, very much. we think all of you for your testimony and cooperation with this committee. and also, frankly that we didn't

hear any complaints about having a nongovernment person be on the same day with government. helps us have a better dialogue and that's helpful to us. so we're very grateful for all four of you. thank you very much. and we're going to not recess. will go right into the next panel right now. thank you. [inaudible conversations] [inaudible conversations] [inaudible conversations]

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[inaudible conversations] spirit that now they are all comfortable he said i'm going to ask you to stand up to swear you in. by the way, thank you for waiting for the first panel. ratio right hand, do solemnly swear or affirm that the test when you will give before this commission is the truth, the whole truth and nothing but the truth? know for the record all of the witnesses responded in the affirmative.

and we're going to start, just go right down the line, mr. gordon, and will ask you to stay within your five minutes. i will kind of let you know if you are coming over a little long. just because we have a lot of panelists. so we thank you for that and we thank you for being here. mr. gordon, you may testify. >> chairman shays, chairman thibault, other members of the commission, i'm honored that you invited me to testify today, the second time i've appeared before this distinguished panel. i've read with great interest the commission second interim report which issued late last week. and while all of us will need to study and reflect on the recommendations in that interim report, more carefully than time has allowed so far, i thought it might be useful to offer a few initial thoughts. first, i commend the commission on producing a thought-provoking report on extremely important topics. the report gives us much to

consider as we move forward with their the acquisition improvement efforts. you're focused on over reliance on contractors in particular, including in sensitive areas such as acquisition and security, resonates with the presidents and administrations concerned about over dependence on contractors, especially in critical functions. second, i particularly appreciated of the report's call for strengthening the federal acquisition workforce. and increasing the attention paid acquisition planning and contract management. we have been calling for this from the beginning of this administration, and it has been my watchword since i became the administrator for federal procurement policy in november 2009. that said, let me turn to the narrower and more operational topics that are the subject of today's hearing. as we work to protect the half a

trillion dollars of taxpayer money that we spend on goods and services each year, we must work harder to do business with contractors that place a premium on performance and quality, and not do business with those whose track record indicates that they cannot be trusted with public funds. the two tools that are the subject of today's hearing, the use of past performance information, and the suspension and debarment process can both help agencies need the schools. over the past two years, as outlined in my written statement and as you have heard from some of the witnesses in their first panel, and you'll be hearing from my colleagues on this panel shortly, the administration has taken steps to strengthen both the way we use past performance information and the suspension and debarment process. the steps are being reinforced by an overall increased emphasis on acquisition planning and

contract management. for too long been focused so much on who gets the contract, that we've neglected what must come before and after the signing of a contract. sound acquisition planning and inconsistent contract management. now after years of inattention, we are finally strengthening the acquisition workforce, restoring the capacity of contract specialists, to plan effectively and negotiate aggressively, and building the capability of those responsible for contract management, including program and project managers, contracting officers representatives, to ensure that contractors meet their contractual promises. i'll leave discussion of specifics to our question and answer come into my colleagues on the panel. who can offer their hands on experience from their work at agencies heavily engaged in contingency contracting. but before i conclude my brief

oral statement, i thought it would offer a couple of notes of caution to the commission in terms of the recommendation in the second interim report with respect to the two topics today. first, unlike the broad area of over reliance on contractors and the need to build the agency's organic capacity, the two topics of today's hearing are largely nuts and bolts operational areas. when we must think very carefully about the burden and effectiveness of one size fits all recommendations. real-life concerns in different contexts, including in the contingency environment, might weigh in favor of alternative approaches. second, both topics in front of you today are areas where there has been substantial change over the past two years, which i hope the commission will take into careful consideration before you

issue your final report this summer. that said, let me close by again expressing appreciation for the commission's important work. we look forward to seeing your final report as we in the administration worked to strengthen the federal acquisition workforce, reinforce fiscal responsibility in our acquisitions, and assure that contractors are used only when appropriate. and not as the default option to use the language of your interim report which i quite liked. and that federal employees always conduct consistent, meaningful oversight so that taxpayers interests are protected. i am happy to answer any questions the commission may have. thank you. >> thank you mr. gordon. mr. ginman. >> chairman shays, chairman thibault, this thing which numbers of the commission, good morning. i served as the deputy director

of defense there, and acquisition policy, one of my areas of responsibility is contingency contracting. i just like to take a minute and thank the commission for your support of our troops and all that you've done to help with the mission. and also to thank the men and women who serve this great nation, not only our military, but the civil servants, the coalition forces and industry partners as well. none of us could get the job done without all of us together. you asked me to discuss past performance and suspension and debarment today. i have prepared a statement, and rather than repeat or summarize it, i will send ask that it be included for the record, and i am ready to answer questions. >> thank you, sir. do i pronounce your name -- i got right. mr. rindner, thank you for being here. >> thank you. members of commission, i appreciate the opportunity to provide testimony before you today. i am corey rindner and they serve as the procurement executive at the department of

state. i've been there at seven years and previous it was at the departmendepartment treasure but i'm pleased to speak you today about ensuring contractor accountability, past performance and suspension and debarment. as is released to the department of state. as the, executive am responsible for trade policy and oversight for the procurement function and also serve as the suspension and debarment official. for the departed on procurement matters. departments to determine operations are most decentralized in the office of acquisition management. a washington-based office, anti-regional procurement support offices for overseas. until recently department of state contracting personnel and assist them reported in the nih contractor performance system, and we're now using cpars. the department it is contractor past performance information into cpars, past performance is checked in pprs, and we have fapiis as a model in pprs with events such as contract terminations for default or not responsibility determinations, recorded by contracting officers in fapiis as they occur.

atm is our main acquisition office has been training personnel on cpars in pprs. we have had the navy development group make presentations both in person and via videoconference it when the processor can the navy cpars manual to fit department of state needs. we are very appreciative of the effort in this regard. the department is also anxious to transit workforce in fapiis and we look forward to fai training in that regard. the department state continually strives to improve its contractor oversight including feedback and other agency reviews, both bp sample some performance assessments in cpars from 10 agencies, and i see you have the results up there. suffice it to say that department state acknowledges and needs to improve and we will take actions to improve our reporting of the past performance. department of state contracting officers reviewed the pprs database to determine if a proposed contractor is on the excluded parties list as the

department and official i rely on the office of inspector general and front-line contracting officers to identify and refer potential candidates for the barn and suspension. my office has no independent investigative capability. in the past year i have suspended three entities in afghanistan penny department of justice investigations. i find our oig referrals to be thorough and well documented. with a collaborative relationship that works well on department and suspension. the present system or by the separation of duty between investigation, contracted and efficient adjudication. this provides due process and a fresh review of investigative evidence. in conclusion, the department of state uses the dod past performance is sensitive and will improve our documentation and use of that system. will continue to use suspension and debarment as necessary to protect the interest of the department state and the rest of government by preventing the award of contracts to contractors who did not possess

the integrity or responsibility they perform. thank you for this opportunity to appear before you. >> thank you. ms. shauket? >> thank you chairman shays. chairman thibault and members of the commission, for the opportunity to appear before you today. to discuss contractor accountability, past performance, suspension and debarment. i am maureen shauket, the chief acquisition officer and suspension and debarment official for usaid. usaid's mission is an important one. our humanitarian and development work serves as a pillar for national security by building stronger economies and more stable democracies. we are committed to invest in u.s. taxpayer funds wisely at each phase of the procurement process. to yield sustainable long-term results. have realized his commitment to usaid forward and our reform to improve the way we do business. we are holding ourselves more accountable and we expect the same from our contractors and grantees. we expect our contractors to be

good stewards of taxpayer funds. we expect contractors to act with integrity, and we're holding them accountable when they fall short. we are on the right track, but i will say frankly you say frankly usaid needs to do better, especially as it relates to past performance reporting. on the positive side, u.s.a. consistently used its past performance as an evaluation factor in our new procurement. for awards over $25 million, our contract review board ensures compliance with as many. when it comes to completing past performance reports, however, we have not been as successful. we estimate a 10% completion rate. clearly this is unacceptable. investing in skilled contract administrators is critical for us to turn the situation around. for this reason we have dramatically increased the number of contracting officers in afghanistan from three in 2007, denying in 2010.

the past performance rate for afghanistan is 38% currently. during most my most recent trip to afghanistan, we established a new positions, administrative contracting officer positions. these officers will focus of their attention exclusively on post-award administration and monitoring contractor performance. i am happy to report a better success story on suspension and debarment. when i took this job in late 2007, the challenges we faced in suspension and debarment were evident, as indicated by mike carroll in his testimony prior to this. one of the key recommendations to come from the ig report was to dedicate full-time staff to suspension and debarment, and we agreed. by the time the report was issued in october 2009, we had already made great strides forward. and in the past two months alone we have taken suspension or

debarment actions against 31 individuals or entities. this has been mainly to our newly established compliance and oversight of partner performance division, a unit devoted to accountability of our contractors and our grantees. this unit manages suspension and debarment and past performance. i'm excited to tell you, this unit will be watching for performance trends, contracted by contractor. this unit will also collaborate closely with usaid's i.t. and the general counsel's office for we have to get much of our recent success to close coordination with these teams. we have made great progress but there is more to be done to improve our accountability and oversight. i believe we can get there. we have expert contract professionals worldwide, especially in afghanistan and iraq, who are dedicated to the strong stewardship of taxpayer funds. we depend on these cios and costars to manage multi-marriage contracts under some of the most

trying conditions. i am extremely proud of their dedication and the sacrifices they're making. as a usaid foreign service officer myself, i have spent over 15 years of my career in asia, africa and eastern europe. a highlight of my crew was building the capacity of to local women's organizations that were pioneers in the fight against trafficking of women and children in bangladesh. as a department of the professional, i feel a deep responsibility to carry out our programs efficiently and effectively, and with integrity. i take fraud, mismanaged and waste of our funds as a serious affront to the mission of our agency, and the trust of the u.s. taxpayer and the beneficiaries of our programs. i think the commission for your attention to these important issues. i appreciate the opportunity to appear before you today, and i'm happy to answer any questions you may have. >> thank you, ms. shauket.

mr. blaylock. >> good morning commissioner's. and thank you again for the opportunity to respond to your questions about the role of the inner agency suspension and debarment committee. suspension and debarment system. as indicated in my written statement previously submitted, we believe the current suspension and debarment authorities of regulations are adequate to ensure contractor responsibility and accountability, if utilized. they have observed improved and increased activity by a number of member agencies. i outlined some of those examples in my written statement -- britain's david. each agency manages its responsibilities for suspension and debarment differently based on its own statutory and functional responsibilities, some agencies like those most active within the department of defense have a centralized system with a single suspending the bar and official but others like department home at the to become a department of transportation, department of agriculture have multiple, for

each of those major components. department of homeland security has nine s. deal to department of transportation has 16 s.b. goes. department of agriculture is 16. some agencies have stos are dedicated full-time to the agency suspension and debarment system but many agencies have senior leaders for whom they have response but as a collateral duty. each agency makes its own decision on the approach structure of its own suspension and debarment system. as noted previously, the suspension and debarment system only works if it is used. the only function to protect the agencies from conducting business transaction for contractors alike present responsibility of agency personnel are willing and able to suspend and debar firms that are demonstrated, they are not responsible. fortunately, many isdc member agencies like the department of army have the will and space to utilize the system integrate innovative approaches for holding contractors responsible.

it is increasingly using fact-based actions because there is essentially no functioning judicial system either contingency environment. other member agencies continue to institute improvements to the suspension and debarment practices. for instance, the department of homeland security as a result of its 2009 oig report for the suspension and debarment assessment committee to review procedures within other agencies and to recommend improvements. that committee visited numerous other agencies to learn about best practices, and in may 2010, the committee recommended that the suspension and debarment process be centralized into a single department of homeland security s.b. oh and to establish a full-time suspension and debarment division, to process? that recommendation has been improved, has been approved within the agency and is being insulated this year.

the isdc understands that improvements could be made to the existing system to ensure contractor responsibility. we agree with many of the national procurement fraud task force recommendations on suspension and debarment. we're awaiting publication of the council inspector general's on integrity, serving on suspension and debarment. the co-chairs of the committee conducting a survey briefed the isdc in its february meeting on the status of the survey. the system will undoubtedly be more effective if each agency had a dedicated full-time suspension and debarment staff to process cases. however, each isdc member agency has to have the discretion, to structure ecosystem because each member agency is in the best position to know what will work, or it. the fact is that the level of acquisition fraud will be different at the department of defense that it is at the pension benefit guarantee

corporation on the institute for museum and library services, both of which are members of the isdc. because of those differences the isdc position is that each executive branch agency must have the discretion to start a suspension and debarment process appropriate for its particular agency. i'm happy to respond to any questions you may have. >> thank you, mr. blalock. mr. fiore, and then we will take questions. >> chairman shays, chairman thibault, distinguished numbers of the commission, thank you for the opportunity to provide testimony before you here today on this important issue of contractor accountability. i served as the drug of soldier and family legal services from the office of the judge advocate general of the department of army. since october 2008 i also serve as the department of the army suspension and debarment official. the army follows a suspension and debarment regulatory processes set forth in the federal acquisition regulation, subpart 9.4.

pursuant to the regulation, an agency may suspend, debar are otherwise declared ineligible certain contractors in order to protect the interests of the government on behalf of the public. suspension and debarment are prospected remedies in which past misconduct for unsatisfactory performance provides the context and insight to the contractors present and future responsibility. contractors are suspended, proposed for department and he barred are excluded from receiving contracts from the government. further, agencies may not solicit offers from or contracts to our consent to subcontract with contractors who are debarred, suspended or proposed for debarment. debarment and suspend your discretion actions taken to assure agencies contract only with responsible contractors, and they are not for the purpose of punishment. discretion in suspension debarment decisions is not unfettered, however. and maybe charles in u.s.

district court under the administrative procedure act spanish fork abusive discretion if it are deemed arbitrary capricious and warrant contrary to law. for suspension, the evidentiary burden for adequate evidence which is similar to probable cause for debarment the standard is preponderance of evidence to a contractor can be suspended when there is an indictment and department is a criminal conviction for fraud or a similarly serious offense. in these judicially-based actions, the underlying judicial action, the indictment, conviction or civil judgment is deemed sufficient to meet the evidentiary standard. but is also subject to rebuttal by the contractor with evidence -- with evidence of present responsibility. a contractor also can be suspended or proposed for debarment versus misconduct that affects the contractors present responsibility that is not addressed any judicial action. including willful failure to

perform our history of unsatisfactory performance. these fact-based actions do not have the presumptive sufficient-based actions, and are more complex and more resource intensive to investigate, develop, and prepare. and agency also can enter into an administrative agreement as an alternative to spin and debar in a contractor when the contractor can demonstrate that notwithstanding the potential basis for suspension and debarment, the contract is presently responsible or can be presently responsible. and administered agreement usually involves remedial measures to address personal organizations or systemic failures, prospected measures such as ethical codes and training, and oversight by the government or an independent monitor to scrutinize ongoing operations. the goal of the administered agreement is to cultivate integrity within the contractors operation to ensure responsible contractor. suspension and debarment may be

delegated as it has any army to a suspension and debarment official. i and the decision authority for all army suspension and debarment cases, including those cases arising in afghanistan and iraq. in europe and the republic of korea because of a long-term army station, you army station, you could take addition of expertise and a host nation, law and languages, the army for the delegates overseas suspension and department authority for contracts in those areas. as the army suspension and debarment official i am an independent decision-maker. i report directly to the judge advocate general. i do not supervise the attorneys and the procurement fraud branch or the program attorneys who monitor and develop procurement fraud, waste, and abuse cases are every pair for suspension and debarment cases for my decision. i received the recommendations, providing guidance, and i render decisions on the disposition of cases. earlier in my career i served as a litigation attorney in the

procurement fraud branch. for the past several years the army has been at or near the top of the department of defense and the number of suspension and debarment actions in fiscal year 10, we took over 400 actions. 309 in 2009, 301 in 2008, and again 350 in 2007. since 2005, we've taken over 350 actions in cases arising in contingency theaters. we are the current caseload of over 1000, 270 of those cases arise in the contingency theaters. i thank you for the opportunity to appear before you today, and i look forward to the opportunity to answer any of your questions. >> thank you very much, and i think i'm going to recognize mr. thibault, but i just want to say, mr. gordon, you started off commenting on our report. and i would just like to say for

the record one, thank you. but number two, the recommendations that are there in this sense are not our recommendations, and that we did a lot of listening and we listen to you and others. so there's been input from a lot of sources. and we thank you for that. mr. thibault, you have eight minutes. >> thank you. mr. gordon, i want to commend you -- i want to commend you, but i want to commend you for your recent memorandum because i think, for us, it's very useful. it's a baseline to have discussions, and i want to share one point of it so that they disagree with, and we can talk about. but if i'm right, that's the busy chart as i see through that, and that's your chart, and that's the $550 billion that you

analyze. and i commend you for that also. those of you in the audience, just need to understand that they have broken it out in terms of adequacy of explanations and narratives to supportive. now, what you have here that commissioner henke talked about earlier is working with the department, those three departments. .. things. and that's not as -- you know,

so, you know, sometimes actions are better portrayed rather than actions to identify what we're going to do. now, with that as a lead-in, mr. gordon, you say at the bottom of it -- not just the two simple parts -- you say that an informal comparison where you align the fpd the federal procurement data system, these acronyms have been completed only for a small percentage of awards. and in the body you -- i'm turning the page now but in the body you go on to lay out, in my words, 70% of these can be improved in some way, shape or form. now, then the statement in a contingent environment, the chart over here with just the three agencies that are going to kind of disagree with you. you say well, the fact of compliance with reporting requirements is important, i agree. the quality of the report

submitted is what really matters. that's on this chart on that chart if they ain't providing it and you've got 90% that are absent and then you have of the remaining 10% 70% can be improved, you know, being an accountant by education, that leaves 3% that are knocking our socks off, 3 out of 100. and so you have to think contingency and i share my point and i ask for your comment is simply that in a contingent -- you know, i unlike that analysis. i think this analysis shows that in a contingent environment, right now you could say, right now the fact with compliance of reporting compliance is most important and you could put it in pairens because it ain't being done and in the future the quality can be improved, too. mr. gordon? >> chairman thibault, i'm in the happy situation to be able to

agree even with what you couched as criticism or disagreement i agree with you. you can't even get started to begin on quality unless you have a report. if i could, could i -- could i step back and say a couple more words about this including the discussion -- >> i'm going to give you about 45 seconds to say a couple more words. >> i'll do my best. i do think that there's -- there were things said in the first panel discussion that were somewhat problematic assuming that these reports would solve all sorts of problems and in the of these reports we have nothing happening. both are problematic. the reports first of all wouldn't lead to suspension of debarrment. these are past performance issues. not things like for termination for default. and secondly, past performance assessments take place all the time. they're required -- we may not have the very good database we're trying to put together, but when i talk to people in the -- on the front line, they tell me that, yes, they do the

past performance assessments. they're required to. they do it by contacting agencies points of contact. i could talk much more -- before let me stop you there. i'm glad you brought it there. i don't know what the front lines are but i've an places in places and they won't go us any further and when we talk to the ccc -- it used to be jcc-i/a, it's regionalized very effectively i think as far as the organization, we say, okay, past performance. yeah, we do it. okay, put it on the table. put your policies and procedures on the table. and somebody said -- we'll get them for you. i haven't seen them. i have not seen the poles and procedures for doing it. the best i got out of lieutenant colonel who got -- she got very irritated with me when i was president was that well, we have it. it's kind of informal. we do talk to people and i said, great. so get that and put it in, even

if it's an index binder or something. it wasn't forthcoming. i have to ask my general officer if i can give it to you and we laughed as we do and never got it. so i say that -- you know, my personal experience is that it's a different environment but i wanted to bring that out because i think right now -- and i absolutely agree with you, that -- that you have to use past performance in the context in which it gives you information. but absent it, you can't use it. and i'm going to tell you there's -- and it was said before by the -- i think the i.g. and a couple of others resources drive it, well, resources drives it but it was set up here but what's it take to document that? and then to consider it? as an automatic item? mr. ginman?

>> mr. gordon, i'm un-claire about this. are you saying there's an unformal process that we use that augments the required reporting and so on and then legally are you allowed to use it if it's informal? >> it's not informal we're required by the statute and the f.a.r. as an evaluation criteria and what happens is, because, the front line is what we call the front line forum. contracting officers who come in and meet with me every three months and we discuss these issues. we discuss past performance because it is such a high priority for us. >> let me just say this is going to come off my time. but i'm really unclear. you've got reporting requirements, most of the time it's not being done. it's supposed to protect in a sense the contractor. they have a right to exowhat's being said. in fact, they even can -- if our recommendation goes into effect, they can protest and stretch it out for months if not a year plus. and then you're saying,

notwithstanding that, we do it differently informally in the field. >> it's not informal, sir. the requirement that past performance be a mandatory evaluation criterion in every contract valued above the simplified threshold for procurements have been in place for more than a decade. >> that's a law and it's not happening. >> it is sir, it is in every single case. i would be astonished if you found a case where there was a mandatory evaluation criterion that was ignored. what they do, though, is they don't use the database. when i asked the contracting officer -- >> so wait a sec. they don't use the database. they go around the database? >> they don't need the database. it didn't exist, sir. we had the requirement before we had the database. the contractors are required to identify relevant contracts that are supposedly similar. they give a government point of contact. the contracting officer contacts the point of contact in the other agency and schinasi or he makes the assessment of the

contractor's performance. >> before we start the clock -- >> i'm going to take this off my time. >> no. the information you're getting in this little quorum is not complete and accurate. i can use usaid and dod in an actual case where there was a failed ghazni school project by a contractor that was part of the contractor and in the prison, again, where there was a failed -- i don't know if it's bazrat or whoever it contracted and i personally in both cases said, have you considered it in past performance? well, we probably wouldn't do business and i say well, fine, are you aware of other locations? well, yeah, the corps of engineers is using them and so-and-so is using them. and i say they never called and asked. so i'm -- you know, why didn't you call them? well, i don't know. so i'm just telling you the information you're getting sometimes is -- good news rolls uphill. sometimes bad news doesn't roll

uphill. i will take a point of gathering some of my data, sir, and sharing it with you just so that -- we're not contentious on the point of the importance. we disagree on the point of -- is it really being done because i'm telling you, it's not really being done in theater. and i've been that to those outlying bases and i just don't go out there for their cameo. we spend a compel nights and we sleep in tents and things like that. so i'm telling you you've got some people that are rolling policy uphill is what they're doing and it ain't being done that way. >> sir, there's hundreds of gao bid protests decisions that discuss past performance without the use of cpars. >> are you talking contingency or are you talking outside of contingency? >> i'm sure -- >> but approximate all due respect there's a big difference

between what happens in a contingency environment and what doesn't happen. >> as part of this continuing discussion that's not part of what we're doing, dick is jumping up and down. admiral ginman can you broy a little light on this? >> let me try this on several perspectives. i laid the department for the peer-review process and so when it's over a billion dollars and we go out, what mr. gordon said is absolutely correct. if we were doing an infinitely better job collecting cpars' data and having it it would be the principal source. when we asked for relevant and recent contracts, the first thing we do is go to pprs and pull that data. if we don't get sufficient data, then you do exactly as mr. gordon said. you go to the program manager of those contracts. we also looked to see -- maybe there's a contract there that they decided they didn't want to tell us about. you go to see are there other recent contracts with that

contractor and look to see, should they be evaluated as well whether the company gave it to us or not. so at least from that perspective -- >> all right. let me, let me -- >> let me try the contingency. >> you're going to get a little bit of time on your own so you're not working on my time. >> i'm fine. so contingency, the fluor attempts where past performance is, in fact, evaluated as opposed to doing a comparative analysis but to determine it has adequate. in the earlier discussion i think the question that commissioner shays asked last was, what would you do? my answer in addition to his thought on oversight would have been simplicity in language. the reason that there's a new past performance system being put in theater is that, one, we have bandwidth issues trying to

get back to stateside, two, more importantly the local vendors by and large do not speak english. cpars has not been a friendly process for local -- >> i'm -- i'm going to cut you off by also saying we've had hearings. your people have been here. lpta is not working as you just described. in addition, we have had cases in the security world where lives are at stake where people did not set aside the requirement and we said why have you awarded them another six or seven contracts and they came here and they said they were lpta and you said but what about your past performance and they sat there and kind of scratched the table. so i'm not -- you know, the point you want to make is well, it's working. well, it's not. >> i'm not saying it's working. >> okay. >> we'll end with that note. >> now, i have one other point that i want to make. i didn't get to the point but i'll make two statements. and you can respond at your leisure. >> first let me just make this point. you will not be here for the second round of questions so we'llist let you go around a

little longer. >> the point what i brought you earlier and i noticed you were, admiral, was that should we be paying in our cost type environment and i'm not talking about the lpta, the afghan first program and people don't need to tell me about that. but do we need -- should we -- when there's an egregious corrective action plan that's agreed to, that is really egregious, and under a cost type environment, we can call it rework or anything you want. right now under the regulations i think it's an allowable cost. if you want to tell me there's a mechanism for contracting officers to go in there and say, no, i can hold you accountable and, therefore, should there be a mechanism where contracting officers in the field have that kind of decision-making authority to say that this corrective action plan is so egregious it's on you and introduce that into the process?

>> so i think it is a question that i don't think i have looked at before. >> could you take an action? >> since 8:00 this morning when asked that question. [laughter] >> could you take an action, admiral, because -- >> yes. >> you all have done yeoman work on the business systems with the withholds and things. >> yes. >> now, in this area, you know, i don't think it's been on the table. but i really think that -- what motivates companies -- and these -- there's some good companies. this isn't about that. what motivates companies is money. i asked a cfo at general dynamics. what are your top three priorities, he said cash flow, cash flow, cash flow. mr. blalock i'm going to make an observation and other people can explore it. i'm disappointed in your representation that all is well but we need a well to use it. i have a word that no one says is a word called pablomistic.

i believe many of your statements are -- you know, we got a really good system and they're effective but you got to have a well to use it. everything we've been shared -- has been shared with us on these charts well to use it right with narrative. well to use it at all in the contingency environment. discussion, the best discussion and that's not a system is, well, we have other ways. and we go out there and look at the other ways, will we really consider it and will we find major gaps. so i just make that statement. i think other people will explore it. i've got to leave on a personal matter. but i want to thank all six of ya because the job you're doing, mr. gordon, is exceptional. and i really like this dialog. and i've never had the admiral be bashful so we'll get back to both of you. >> thank you. >> thank you, mr. thibault, cochair. and mr. green, you have the floor. >> thank you.

mr. blalock, following up on commissioner thibault's comment, it came out in the panel this morning -- i don't think it's any surprise that you guys are supposed to be providing some reports to congress. you haven't done it. why? what are you doing? what do you do? >> thank you for the opportunity to explain that. you know, there's a risk when the government relies upon volunteers to do important government functions. for many years, from its inception in 1986 up until the spring of 2008, the isdc was privileged to have a very fine senior leader at the environmental protection agency as the chair of the isdc. because of his position, he could spend as much time as he needed to on isdc business. he had several staff members he could draw upon. and he had a vice chair who

handled all admin and logistic matters for him. omb wisely when that individual announced his requirement required applicants to replace him, to provide an assurance that their agency would provide them with sufficient time to do the isdc business if they were selected. at the time, the navy sdo, who i worked for, did that. provided an assurance. well, unfortunately, then the world changed. that individual in may, 2009 -- that individual left and went to another position within ogc. i became the acting head of the acquisition integrity office and my responsibilities there for managing the office and attending a number of meetings that i didn't used to have to attend as the mere deputy took a great deal of my time in twine.

in may of 2009, the navy got a new secretary. that secretary -- because of his prior experience -- >> i don't want to spend a career on this. >> the fact of the matter is, let me -- let me cut to the chase. my responsibilities at the navy have been increased by an order of magnitude and i have simply not had the opportunity to finish the report -- >> who -- >> if i may finish, i finished the fiscal '09 report in september of 2010. we decided to submit the draft report to the isdc members because it is a collegial body that tries to get everybody to agree on something before the isdc takes a position. that draft report was submitted to the isdc members in november of 2010 that. the draft report for fiscal year

'09. comments that came back were, we were already so late, why don't we combine the fiscal year '10 report with the fiscal year '09 report? that is what we were doing? we send out to meet the requirements addressing active participation by the members. we send out a survey -- >> okay. that's enough. who appoints you? who selects you? who's your boss, not your navy boss. who's your boss under the isdc? >> the isdc -- omb selects the isdc chair. >> okay. do they have oversight over your activities? do they monitor you guys? do they care what you do? obviously, nobody cares what you do. >> there are two representatives from omb who are considered

liaisons to the isdc. one from op and one from the office of federal financial management. one of those individuals usually attends the isdc meetings. she is available when i have questions on policy matters or something like that and usually responds to them. >> but who says, damn it, you're supposed to report to the congress. you haven't done squat? who cares? >> i don't have an answer for that. >> okay. that's enough. mr. gordon, i'm having difficulty understanding. i understand that, you know, we got some stuff in cpars, contracting officers talk to each other out there and compare notes and all that kind of stuff. and i don't disagree with much of that goes on, but sometimes as commissioner thibault says, it doesn't go on anyway. how does that square and what

good does it do when 60% of contracting officers say whether they're in cpars or talking to their buddy, when 60% of them say they don't use past performance in contract decisions. how does that square? so what good does it do to have this stuff if you're not using it? >> mr. green, let me say first of all, that despite my explanations, i want to make clear we very much agree with the bottom line here, which is that we need to improve entry on the chart on the left and the quality of the chart on the right. i'm not sure what the people were referring to when they said they didn't use past performance. obviously, you could have a situation where past performance wasn't the discrimnator. i don't know if that's what they mean. if they mean they violated the law and did not include past performance is an evaluation criterion, i'd be very, very surprised. but i don't know what -- i don't

know what the statistics are. >> it was in an '09 gao report. >> i don't recall what the context was. i'm happy to look that up, sir. >> okay, thank you. any of you, intercontingency operation, we've got a lot of money coming in. the tempo is very high. many opportunities despite the examples that we've used with boeing and northrop and others -- many opportunities to -- for fraud and waste. should we have a different system within special wartime sanctions if you will in a contingency operation so those contractors -- what some of you

have termed too big to fail so that sanctions can be levied against them? >> you're asking my opinion, sir? >> yeah. >> i would -- i understand that the contingency environment creates special needs. and there could be appeal in having either a streamlined process, a different approach if we went down that road. first of all, i'd want to reflect on it and hear people's views but if we went down that road it might also make sense to limit the suspension or debarrment to that very environment. that is to say in afghanistan, for example. >> maybe it doesn't involve suspension debarrment. maybe it involves monetary penalties of some expanded nature, if you will? >> as with many of the recommendations, i saw in the interim report, it is an idea worth exploring. i'm uncomfortable giving an off-the-cuff response to what could be a very good idea.

>> okay. thank you. anybody else? my time is up. >> thank you. we'll go to mr. tiefer. thank you, mr. green. >> thank you. you're both head of ftp and you're one of the most distinguished scholars on procurement law. although the report shows the incredibly low percentage of solid combinations of -- for past performance ratings and narrative. but as you -- drawing off on your knowledge of procurement, isn't it possible today for contractors to take advantage of this situation of the absence of ratings by taking contracts,

which they have performed poorly on, but no one put into the system a rating or a narrative and citing those contracts when they're trying to show that they have the past experience, the past experience in theater, in wartime to get the contract? >> professor tiefer, thank you for first of all for the kind words which i fear may be undeserved and you may agree by the time i finish my answer. >> o? -- oh? >> i understand the point, issue number one i want to agree with chairman shays. the way to address the problems is senior leadership and with acquisition status meetings. we say they must improve the recording of past performance. >> mr. gordon before we talk about how we treat the problem so we agree there's a large problem that contractors who believe who should have been rated for bad performance on citing their contracts for experience. >> i don't have data and you

know my g.o. background makes me reluctant to answer without data but if a company says we worked on contract a, b, c and we should get credit for that, the contracting officer before she or he gives credit, it's usually mandatory. the contracting officer needs to check with that government agency and say how was their performance? and the answer that isn't cpars is completely irrelevant. >> i understand. i think we agree that it's prevalent. and ms. shauket, i'm honored how you've taken these posts around the world that i don't even want to visit those countries and i'm impressed that you're working for us there. but i do want to ask about louis bergert. i notice there's a suspension and debarrment but it doesn't

mention louis which for a.i.d. is sort of like discussing the titanic thinking without mentioning icebergs. the description that we got from mr. fiore of the systems -- the suspension of the debarrment systems says about administrative agreements and you have one with louis berger that this is entered -- agency can enter into administrative agreement, et cetera, et cetera when the contractor can demonstrate that notwithstanding the potential basis for suspension or debarrment, so forth and so on. my question is, did a.i.d. have a potential basis for suspension or debarrment of louis berger? >> well, thank you very much for the opportunity to address louis berger and the issues.

i understand the outrage you must have behind your questions and i just want to assure you that i, too, share that outrage when i heard what louis berger had been doing for a period of years through the falsification of the cost rates. by the time i became aware of this -- and i will say, quite frankly, that our relationship with our inspector generals office due to timely information has been much improved since that time. however, by the time that i became aware of the issues, through the department of justice, when we met with louis berger, they had already taken substantial remedies -- >> could i incur to the particular question i was asking. >> yes, sir. >> which -- and i'm taking mr. fiore's language so it's not a question -- i think he knows what he's talking about here. that to enter an administrative agreement you would have had a potential basis for suspension or debarrment?

did you in his words have a potential basis for suspension or debarrment of louis berger? >> in my opinion, no, not at that time. >> you entered into an administrative agreement without a initial suspension or debarrment is that what you're telling me. >> at the time we entered into the administrative agreement -- if you recall in the last panel, mr. amey said they would recommend suspensions if they had systems in place. prior to entering into that administrative agreement we did just that. we met with the internal controllers and the official -- >> i know. they fix things up later after the -- after the horses have left the barn they fixed the door up real well. is it the case that louis berger has a prospect of seeking literally billions of dollars in the years ahead in a.i.d. i cite is an example because we

had a full discussion of this at a hearing that the northern and southern electoral grids of afghanistan will probably be an a.i.d. goal to link them up, and that the pieces that are being putting in place now in kabul and kandahar are with the idea of eventually linking them up and surely louis berger would be one of the ones seeking this. but wouldn't you expect they would be seeking literally billions of dollars of a.i.d. money? >> i cannot speak for what louis berger will be doing. but i can tell you that our policy is to compete programs and if they are exceeded, we will be looking at their past performance as part of the evaluation criteria. >> and the cpar system has a write-up of louis berger's activity? >> well, actually i'd like an opportunity, if i may to address the chart. ..

isn't it the case that first kuwaiti was up to successfully go on and compete for state department business building embassies elsewhere without a cpars entry saying that they had poor performance? >> i don't know specifically if first kuwaiti enter understood cpars or knot, sir. -- not, sir.

>> do you know whether they have gone on to show poor performance on later jobs they have done for state? >> i do not know that, sir. >> if you did a lexus search of first kuwaiti, it would jump out and sock you in the eye and my time has expired. >> thank you. mr. henke. >> mr. rindner, you have a career in acquisition, correct? >> yes, sir. >> how many years have you been working in acquisition? >> about 37. >> most of that time was it treasury or other agencies? >> at treasury, navy, the department of state. >> you've been at state now seven years? >> yes, sir. >> you're the senior procurement executive. is that a statutory title or regulatory title? >> i don't know if it is statutory or regulatory. cao is statutory. >> right. but you're the senior procurement executive. do you have, how many people are in your immediate office? >> about 22. >> do you have, i understand you do not have operational

contracting under your purview? that is a separate office? in other words, you don't cut contracts? >> that's correct. >> your statement says you're responsible for workforce training, policy, oversight. i think you did some former acquisition assessments? >> yes, sir. >> okay+++ç]+ estimate. what is your figure? >> i don't have that figure, sir. >> you, i would have to look

it up. >> you don't have a figure. >> i said i would have to look it up? >> you didn't bring it today? >> no, sir. >> i think -- >> could i ask the gentleman, can you explain why you wouldn't be prepared to answer that question, given, this is a hearing on this very issue ? >> i did knot look up the data, sir. >> are you answersing because it is not extremely low? >> i'm answering because i do not know the figure, sir. >> does someone in your office have it? >> i think the information would be available but it would have to be looked at. >> we'll be here another hour or so. would you have someone at your staff reach back to your office and get the hearing? >> the compliance rate in '08, 09, 2010. what percent of the reports are in the database? >> bob, could you yield for a second. >> yes. >> you're in charge of this effort, aren't you, at state? you're in charge of procurement at state? >> i'm in charge of procurement policy at state,

yes he . >> isn't this kind of thing someone who is in charge ought to have on the tip their tongue? who is really in charge, if not you? >> [inaudible]. >> thank you. >> you have the time. >> could i get your reaction, mr. rindner, what i call the quantity chart? zero assessments done out of 93 contracts. those are just contingency contracts. that is our ball, that is our game here, iraq and afghanistan. we counted 93 actions from state in iraq and afghanistan but no reports, no assessment reports. what is your reaction to that? >> my reaction would be, if the information is correct, that we need to serious ily improve. >> is your gut say it is right or wrong? >> again i would have to look at the information, sir. >> okay. now

if that is correct, or a little better, maybe half the reports. let's be generous, which would be a pretty high par ba -- bar, what would reaction be to the quality chart? as my co-chair explained, from reports that were done, these were ones done well. nobody really get as great grade here. everyone struggles with it. you see a lot of red and yellow on the chart. what is your reaction to the reports when they're done? >> my reaction to both quality and quantity improvements mead to be made. >> okay. your statement says, i was really left a little disappointment by your statement. there is not a lot of quality in it. generally good thoughts. the department of state continuously strives to improve contractor oversight. probably a true statement. i hope it is but it is very lackluster. you're saying in the process of tailoring the navy cpars manual to fit state. when would that be done? >> i would have to get that information from the operational officer.

>> is it your responsibility? >> no. that is in the operational contracting officer. >> that's okay, would you get that for the record, please? yes? >> yes. >> okay. you say in your statement, the department uses past performance as an evaluation factor to select our contractors. and i take mr. gordon's point that the data may be out there, even if it is not in the system but the fact that it is in someone's drawer or desk, does it really mean it's out there? can you react to that statement? >> my experience is that the contracting officers will contact references and get information. >> they will contact references? >> yes. >> those are references provided by a contractor, right? >> correct. >> okay. let's talk about that. a contractor put as proposal in and they say, i have referenced, a, b, c, there you go. contractor's probably going to turn in good references.

nobody would do otherwise, right, generally. so they're going to give you ones that are good. our recommendation 21 in the report, can you react to that. >> what is that recommendation, sir. >> have you read our report, mr. rindner? >> i've just seen an executive summary? >> i've seen an executive summary? >> have you read our report? >> i've seen an executive summary, sir. >> mr. rindner, i'm not, this is not a difficult question, have you read our report? >> i have read the executive summary, sir. >> our executive summary or a prepared by your staff? >> i believe it is your executive simry. >> so you read the executive summary in our report, i understand. our recommendation number 21 when a contractor provides references here is my example, a, b, and c they can only do that when those contracts are recorded in the database. we're required to assess

contracts, right, mr. gordon? >> yes. >> law, regulation, and policy. we're required to put it into the database, right, mr. gordon? >> yes, sir. >> if we're required to do all that, what about the idea of using, making sure that only references that are in the database can be used mr. rindner? >> i would have to study it a little bit more, sir. >> can you give us, you've been procurement executive for seven years and you have 30-plus years, can you give us your reaction to right here? >> i think the information in the past performance database would be very valueable to have. i think any incentives to put that information into the past performance database would be good. i think you're switching the intent -- incentive to the contractor. >> right. >> i think we need the incentive on the government's part. >> what is the incentive on the government's part? we couldn't find one, frankly. we thought, let's bring another party. let's bring contractors. give them equity in putting

past performance in the system. what about that. >> not sure how the contractor would leverage back to the government, sir. >> well, i guess that would be a problem if they're trying to get later awards, wouldn't it? that may get the government's interest and contractor's interest. just a couple more data points, mr. rindner. on issue of suspension debarment did you receive in 2009? >> 2009 i believe that was three, sir. >> you received three referrals? how many in 2010? >> i believe, i would have to get that information. 2010 i believe it was three. 2009, i'm not kite sure. >> you're not sure about 2009? so you don't, okay. you're the sole sdo? >> that's correct. >> so -- sco. >> that's correct. >> we heard from mr. blalock agencies that 16 scoes. you're the sole guy at state,

7.5 billion. how many referrals, how many s and d referrals did you get from the sig in 2009? >> i believe it was two, sir. >> you believe it was two. how many in 2010? 2010? two cases that resulted in several actions. >> okay. so two in 2009 and two in 2010? right? >> i guess i need to define referrals. >> a referral -- >> referral for specific incident that may involve more than one party. so in 2009 i believe it was

one resulting in two actions. and in 2010 it was two resulting in, three, six actions. >> six actions. so you've got one referral and in '09 and 2010. in the past year, you suspended three entities, i'm assuming, this is your testimony. in 2010 you suspended three entities in afghanistan. is that an accurate number? i'm over time. i have to stop. >> correct. >> okay. thank you. >> thank you. dr. zakheim. you heard what my colleague professor tiefer asked about louie bergeer. how long has louie bergeer been working in afghanistan?

>> i believe quite some time. >> i believe from the beginning. louie berger cut as deal with the government. as you said they did some pretty outrageous things, correct. >> yes, sir. >> let me add, i was just in afghanistan, afghani do you know who he is. >> yes. >> he is the former minister of finance who is also the top advisor to president karzai on the transition. he was once again outspoken about just one company, louie berger. and he has been publicly are and privately for years. at what point do you decide that louie berger is part of the problem in afghanistan and not part of the solution? well,. >> well, sir we have the administrative agreement in

sfas, anyone looking at their past performance that is in there and we'll learn the terms of their previous wrongdoing. as far as it relates to their performance, i, am hesitant because i don't want my comments to appear in any way defending louie berger. clearly we have had problems with them in the past. i recognize that previously the karzai khost road had been identified where they receive ad fair rating. i'm aware on the program that over 18 people were killed and 35 were wounded on that program. it is a tough environment. in 2009 our mission in afghanistan really took a hard look what was happening on our programs and did an internal assessment and an assessment of our contractors. as a result of that we changed a lot of the way we do business. we brought in more engineers, moreover sight and we have also sat down and talked very sternly to our

implementing partners about the problems that we have had. i believe the past performance record shows that both black and beach and louie berger taken these comments to heart and their most recent past performance reports indicate higher ratings. i believe they are addressing our concerns. >> okay, you've set up a new office, compliance and oversight? >> yes, sir. >> and you've got a whole list of things that it is going to do. could you give us a time table, when they're going to actually be up and running and doing the various things you've listed? >> well, i recently hired the director for that division and, as soon as he came on board, his first mandate was to conduct interviews because we had already gone ahead with the recruitment for other individuals. i believe we're bringing on three more in the middle of march. we hope to have the entire office staffed up by the beginning of april. >> okay, thank you.

mr. gordon, you made in your verbal statement starting off this panel you said, you criticized the notion of one size fits all. you said there are alternative approaches. such as? >> thank you for the question, dr. zakheim. i had some concern when i looked at the recommendations you would be going down the row and asking us do you agree with this and do you not agree with that. i had concern it could be an approach that works in one environment, might not work in another. to give you one example, the certification requirement that you have in with respect to cpars, i had some concern that the certification requirement might not get where we need to go in terms of getting senior agency leadership. and i just wanted toing that -- to flag for the commission's consideration the possibility there may be alternative approaches.

>> well again, give me one. how do you, if you're a senior official, you are, i have been, if senior official isn't flagged the senior official doesn't know. if senior official doesn't know he is not going to do anything and or she is not going to do anything. if they don't do anything the people down the chain will not do anything. so give me an alternative. >> we put in the january 21st memo a series of things that need to happen. a meeting with emb officials to see how they're doing. we want to be data driven. we want to see what is actually happening. we want to make the picture improve and the certification itself strikes me as something that might be useful but might not be the most effective way. >> fair enough. you're head of ofdp. omb says jump. agencies say how high. have you had a meeting yet with senior officials? how frequently will you have them and how will you measure if they're complying?

>> yes, sir. we just finished a couple months ago first round of the session where we checked to see how they're doing. not only with respect to past performance but other areas the commission rightly flagged like dependence on contractors rebuilding acquisition workforce. we have them run through how they're doing against the criteria, to get a sense of whether they're making progress and if not, what they're going to do to address the problem. absolutely sir. >> did you get a report on that publicly? the. >> acstat summaries are not reported. i would like the get to the opportunity to get transparency and. >> since you're in charge you could decide they could be public, right? it is not classified? >> it is not classified, sir. it also goes back to the past performance information to pick one example. there is some back and forth. seems people are rightly divided whether it is useful for past performance information to be open to the public. >> that is only in the case of a specific contract or

contractor. >> yes. >> if you're aggregating the numbers no reason why we can't getting a a gaat numbers. can i get your under tykesing that you will make the aggregate numbers public? >> you have my under staking we will look and see if we can get the ac stat summaries available because i think it will be helpful for how agencies are doing against all the goals we're pushing. >> one other point. you said there has been substantial change in the last couple years. certainly the chart for fiscal 09 doesn't show substantial change at least for the agencies that concern us in this hearing. has there been substantial in fiscal 10? do you have numbers that are more updated than the ones on that chart? >> i don't have updated numbers here, sir. we would be paper to get them for you. but i will tell you to give you one example i think should resonate with the commission's interim report, we are working with fai, to

get training for the workforce, how to prepare these reports and do them well so we have both quantity and quality. with respect to suspension and debarment. there have been high-profile cases including by sba as well as colleagues on this table that i think have gotten people's attention. that there is a change in our attitude to contract management. >> mr. fiore, i was struck by the initial part of your statement. you had a very long paragraph about soldier, family legal services and you had a short sentence about your suspension and debarment role. what's the proportion of time you spend on those two different roles? how much time do you spend on the role that involved the big paragraph and how much time do you spend on the role that involved the short sentence? >> sir, i think it depends on any given week. >> give me a sense. you have a sense. >> my sense would be about

60-40. because i do not have the, the direct supervision responsibility for that office, i perform the suspension debarment portion of that responsibility as well as the soldier and family legal services. >> do you think it makes sense, i know my time has run out, for something as important as suspension and debarment not to have somebody focusing on it full time? >> i focus on it as as is required as the ajudicate tore -- adjudicatetor. the army always had been independent adjudicatetor for that role. the suspension debarment official serves serves as the super supervisor of the program office which has more time and other duties attendant to it. as time is required i devote as much time to it as needed? how big is your staff for this job? >> the army staff is five full-time attorneys in the program office.

i do not have a staff. i essentially am the adjudicatetor. they prepare documents that i need to have. >> you're a one man operation 40% of the time? >> for that particular role. >> versus suspension and debarment which i think we all agree is very important. thank you. >> thank you. miss shauket, i said you could give an answer i would like it to be brief because it is own my time. i would like the answer. >> thank you very much. >> you're answering what question? >> i'm responding to the chart itself. >> okay. go for it. >> in preparation for this hearing we went into pprs. we were surprised we couldn't locate many past performance reports we knew had been done. we contacted the administrators and they realize there was a prime when the transfer took place. according to our records we have 24 reports that were done for 2009 in afghanistan. >> 24 out of? >> out of the 81. >> thank you.

>> thank you. >> mr. gordon, i have to tell you, i really enjoyed your previous testimony. i like your testimony pause i think you're willing with to give clear testimony and say something that's important but i am troubled by the fact that you seem to be on two sides here you say the entry is bad, the quality is bad but in essence we look at past performance in spite of this. so, i need you to explain to me why do you we need the database if there is another way? and you know, give me your eloquent and short answer. >> very short, sir. the database which i will be much more complete if it is done properly. that is the short answer, sir. >> okay. >> we will be following up including a public report to show progress. >> let me give you three reasons why i think you need a database. it is transparent. fair to all parties government and contractors

and good governance. would you agree with that. >> would agree with all three, sir. >> you don't like to call the past process informal but it is informal in one sense. it is not prescribed in law. you are not giving contractors the right information because it is not transparent. for first time i have sympathy for contractors. so like if we made it transparent they could respond. if we don't make it transparent they don't know what we're saying which i found really surprising. >> sir, it is transparent. it is actually and it is required by law. contractors have the right to respond to negative past performance guaranteed by law. >> how do they see it if it is not -- >> if adverse past performance information is going to be taken into contract in source selection and they have not yet had a chance to respond they are required by law and regulation. >> that's the law. is it happening? >> yes, sir. >> if they lose the contract, and it is because of adverse past performance information to which they have not had a chance to respond, they file

a protest. they will win that protest if that is what made the difference. >> so your testimony under oath is that, you look at all past performance and contractors see all past performance and your testimony under oath it is very transparent? is that your testimony? >> sir, the current system is very, very flawed and incomplete. i did not testify that we look at all past performance information. we should and we do not yet do that. we need to do that. >> you started to give the impression with your emphatic statement. that's the reason why i just want to clarify. mr. blalock, i was pained beyond measure at your response to mr. green's question to you. it was, i've been around and on this side often and i was pained and i wanted to just be clear about the mdaa 09 was passed in '08 and, it

required progress efforts to improve suspension debarment systems. you're supposed to report on that, how you're progressing. it is supposed to, member agencies, you are looking at what 50 member agencies are doing as it relates to that. and you're to recommend to omb changes to suspension debarment system and its rules. that's what you are the ifdc chairman, is that correct? >> that's correct, sir. >> that did what the law is. you you were using the term volunteers. i didn't know the government had volunteers. what a misnomer. these are government-paid employees that come together to assist in this effort but it is under your responsibility. i would have thought the answer to it was, it's my responsibility. i didn't give it the highest priority. i depended on other agencies

and i didn't get them together the way i needed to. and that would have been the answer. i would have said, okay, everybody screws up but you tried to pass the buck on. i was looking at mr. gordon. maybe i'm unfair here, but mr. gordon, i would have been pained with that answer. i want to know were you satisfied with the answer you heard from mr. blalock? >> we do have a role at omb in the isdc and i think we need to work, i take it as a commitment we need to work to get that report in, sir. >> with mr. rind any's response and mr. blalock's response, did you get a sense that maybe you guys need to get together a little and work out responsibilities? because the sense i have is that neither mr. rindner or mr. blalock feel like it is their responsibility. and the question i'm asking is, is there been some helpful information here that will enable you to kind of sort this problem out for us? and i'll give you the analogy. when we had the hearing with dcaa and dcma, we realized we were ships passing in the

night. that is what i feel is happening right here. do you have a sense some of this is occurring? >> are you asking me, sir. >> yes, sir. >> chairman shays, i will tell you i think the isdc provides a very valuable opportunity for us not to be ships passing in the night. i've been in the meetings. they were very valuable place to exchange information that is separate question whether we need to get that report in and the answer to that is, yes, we need to get that report into congress. >> the 09 report and 2010? >> yes, sir. >> both of them? yeah. do you understand, mr. gordon, why congress requested it? >> yes, sir. >> mr. blalock, do you understand why they requested you to do this? >> i do, sir. >> okay. >> i said i would yield back some of my time since i already used up more time when mr. , my co-chairman was asking questions. so we're going right to mr. green.

>> thank you. >> okay. mr. zakheim asked you very briefly about the new compliance you established for compliance and oversight. what prompted that? and why did it take so long? >> well, what prompted it was the 2009 ig report which recommended it. prior to that it was other duties as assigned by my staff. we had requested additional staff and had not been able to receive the funding for that additional staff. so we were very thankful for the ig report to give management attention to this issue. we -- >> does it always take an ig report to get people to focus on important stuff? >> i would like to think not. and actually in our administrator, dr. shaw, he has really, his leadership has really helped this. we had --. >> what about previous leadership? >> they were not as focused

on the disbarment, suspension compliance issues. dr. shaw has been. under his leadership what was pledging through the bureaucratic channels was expedited so we could staff up this office. >> okay. fine. a.i.d. in trips into theater, has always not covered themselves in glory with respect to oversight of contractors. and, complicating matters is the fact that, well, first of all, you have got a limited number of folks to get out, security is a problem, so forth. but, complicating matters is the fairly significant number of large subcontractors that are used. are there plans to measure their past performance?

. . >> we do hold the contractors responsible as i'm sure you're aware. there's a section called other and what we're looking at when we're going to be establishing our new policy is that we use that other section for specifically our larger subcontractors. we're also looking the number of two years within our contracts. we have an initiative going on

right now called a3. it's a accountability in our assistance for afghanistan it's in draft right now. it's going to be recommending that we limit the number of tiers we have on our contracts so that we can perform better oversight. >> okay. >> i would also like to say there's a new monitoring and evaluation policy which i hope will facilitate that. >> are there contractors trigger? >> in -- -- too big to fail. >> in my opinion. >> in the past year '07 '09 hundreds of contractors have found to have committed fraud with regard to dod contracts. it didn't affect dod's contracting behavior, however, during the same period, three-year period dod awarded almost $300 billion to

contractors to these same companies. despite this, dod stated in a report to congress in january, 2011 that, quote, believes that existing remedies with respect to contractor wrongdoing are sufficient. i don't follow that. >> i need to be careful, commissioner green. i think the report that you're referencing has not been submitted by the department of defense. and there has not yet been a final department position issued. if, in fact, you're referring to the report that was posted on senator sanders' website. is that the report you're referring to? >> yeah, yes. well, if that language is being considered, somebody ought to look at it pretty carefully. >> yes, sir. i would agree.

absolutely. >> okay. thank you. my time is up. >> thank you, mr. green. mr. tiefer? >> thank you, mr. green. we found -- we were struck by the figure of $280 billion that have gone to contractors with fraud judgments or settlements. so i want to ask a little bit about that. >> can we clarify that's just the -- >> but again, i believe that the number you're reference again is a report that's not finished by the department. that we continue in discussions with both justice and treasury to determine whether the numbers are accurate in how they are portrayed. so i'm very uncomfortable -- >> i won't ask you -- you don't like the question that follows,

just stop the question. what i think -- i did see the comment where judgments or settlements of a million dollars or higher. and i just want to make the contest whatever. i want to make the commonsense observation but i do want to know, that the way one gets up to very good figures is that there's not tens of thousands of convicted little contractors. but that the figure gets high because there's a relatively smaller number of big contractors who get such contracts? >> so the figure can become large if you look at the figure for a three-year period of time in the numerator and then put -- i'm sorry. i said that incorrectly. if the figure can become very large if i look at the entire three-year period and the suspension of that particular company or the subsidiary of a particular company was for a one-week, a two-week, maybe a

one-year period so that the -- >> i'm with you. >> i just -- >> what i want to ask you -- we've been discussing i mentioned them to the first panel as the flagrant 5 some big contractors today. louis berger which pled to felony left fraud, kbr on subcontractors. agility which has actually been suspended but it's getting exceptions. and i want to know because we've asked this often. isn't the reason that we have the contractors who are swelling this figure up to very high levels -- that these are contractors who are not only big but they are what we call in theater, in wartime too big to fail. that the government is too dependent to want to do to keep them -- keep them going. keep them playing with us, give some we'll have more chances to

play with us, yes? >> i would agree with ms. shauket, i don't believe there's any contractor that's too big to fail and we'll find alternatives to replace them if need be. there are certainly situations where if the contractor is currently performing and i need to continuing that service for the war-fighter, i may be forced to use them until i can run in other competition and put one in place. i'm uncomfortable with the concept that the numbers are only from the large contractors. i have not personally seen the actual data -- >> could you supply for the record some reason if you come to some reason that you think we got to $280 billion without -- that the -- it's such that we've gotten there by thousands of little contractors. >> well, sir, if i may, what i will commit to, when we submit the report and it's signed out that day, we will submit it to

the commission. >> mr. gordon, you said, and i wouldn't change a word of it, that suspension is, quote, one of the government's most powerful tools, quote-unquote. and i agree with you. i don't think it's unreasonable with me to agree on that point. when you see what was done with louis berger, the use of a deferred prosecution agreement and an administrative agreement so as not to -- not to suspend, aren't we seeing the rise of a new way that we will not be using one of the government's biggest tools. and i'll put it to you this way. i haven't seen much in theater of this kind of deferred prosecution and administrative deferment thing. we've not seen it. i believe there have been many of them in the foreign corrupt

practices act area but not contracting in theater. will we see more of these since it seems very advantageous to the contractor? >> professor tiefer, i'm not in a position to predict what's going to be happening in the contingency environment. i certainly believe that suspension and debarrment are tools which we need to be somewhat more willing to use than we have in the past. i will tell you that i have concern when i hear people talk about automatic suspension or automatic proposal for debarrment. and i should say that i think mr. blaylock has helped in the isdc in strengthening exchange of views about these practices across the agencies. >> you don't -- you're unwilling to say that there will be more use of this? there hasn't been use of it in the past and i saw you nodding but that didn't go in the record. am i right there hasn't been use

in theater contracting of this approach in the past? >> yeah, i didn't want to mislead by any nodding i did. i was understanding what you were saying. i'm not aware of the statistics in theater nor can i predict the theater there. >> thank you, my time has more than expired. >> mr. henning? -- hen, which >> pogo has attempted the isdc and they haven't back from you. mr. blalock will you commit to talking by pogo and mr. amey by the end of the day? >> i will. >> other duties that were assigned and that was one of the fixes implemented, okay, we got a problem let's put some resources people on it full time and have them do it. now, mr. blalock -- your organization has been around and i assume you as well from at least since 1986. >> right. >> 50 agencies. and do you have any full-time staff on isdc? >> no, sir.

>> so you all do it out-of-pocket, the duties as assigned in addition to your day job? >> that is correct, sir. >> would you, mr. blalock, and mr. gordon, take on for us -- would you commit to looking at the idea of some small number of permanent staff on the isdc to staff it up? i'm not talking about more than a handful of people to run the thing administratively and support the members of the isdc. will you look at that and give us your response in 30 days? >> sir, i'm happy to look into it. we are, as you know, in a very difficult environment. i was somewhat concerned that mr. blalock was being heavily criticized. he's put a lot of effort into the isdc but, yes, i will be happy to get you an answer within 30 days. >> because -- i mean, we're talking about five action 600 billion a year in procurement. i think we could find some resources to staff up final for the isdc. that's just my opening suggestion. my third question is, would you, mr. blalock, and mr. gordon -- would you commit to submitting

that required report for 2009 and 2010 by march 31st of 2011? i will commit to that. >> okay. thank you. ms. shauket, the idea of -- if i understand right, you're funded, your office, the procurement function cost analyst are funded out of what they call the operating expenses report, operating side. >> hoax -- okay. looks at the overhead accounts, the operating accounts. what is an idea out there to remedy that situation? what i'm saying is you probably have a hard time hiring a cost and price analyst at the same time you're putting out billion dollar contracts to do things. what's an idea to solve that? >> well, that's correct. in the past our operating

expense funds have not kept pace with the proportional increase in our program funds which has risen 45 minutes since i took over as the chief acquisition officer. to the qddr process and usaid forward we're looking on the establishment of working capital fund that will basically receive 1% of the program funds to administer proper oversight of our programs. >> just a 1% on top of all the -- on top of what's groan by 45% program money to do for an assistance programs you would take 1% and it would be scalable. >> that's correct. >> as the program gross oversight has to grow and they have to keep pace with it. >> exactly. we're currently about the same number of staff that we had in the late '90s, despite the increase. so this would be a way of tying that -- >> is that right? >> so we would have real time -- >> i don't know why i'm -- we've all seen the graphs of

procurement spending going up and acquisition work force going down and mr. gordon to his credit has taken it on very significantly. your challenge is how do i pay for it. >> yes. >> i think you've acting good idea. >> oh, thank you. and i would also like to thank mr. gordon for the acquisition work force initiative which actually funded our compliance division so thank you. >> okay. is that -- that's not section 852. that's dod money; right? >> 852 is dod money. >> okay. any updates on numbers and compliance for me? >> what we have 24 entered in 2009, '6 and 2010. >> 24 -- you're talking past performance? 24%? >> 24 entries. >> in 2009? >> correct. >> how many contract actions? >> i don't have that

information. we can get that. >> 24 entries in 2009 in all of the performance reporting database? >> correct. >> not just iraq and afghanistan; right? that's total? >> that's correct. >> okay. >> 24 entries in '09 and 6 in 2010, right? that's the data you have now? >> correct. >> and you're a $17.6 billion operation? roughly how many contract actions did you do in 2009, just roughly? >> i don't have that figure off the top of my head. it would be thousands. >> thousands of them. okay. what about the suspension debarrment side. you said you had one referral? in '09 and you took two actions. what were they? >> in 2009, we had a debarrment of a contractor in venezuela. >> and -- you said there were

two actions. >> there's two actions, two parties involved in that transaction. >> okay. so you got 1 referral in '09 which resulted in one debarrment? >> bhab 2010. >> we had two suspensions and a debarrment that resulted from a referral. >> okay. thank you. >> mr. ridner in your testimony you gave some percentages that ofpp came up with regarding various narratives. it looks like less than half of the entries affected quality. there was insufficient narratives for schedule control in more than 60% of the entries. there were -- you gave sufficient but i'm giving you

the insufficient. insufficient narratives for cost control in more than 70% of the entries and insufficient for business relations again in more than 50% of the entries. at least you admit and i'm quoting here it is clear we must improve our documentation. no kidding. and then you list a bunch of things you're going to do. so i'd like to know when exactly will you start reviewing past performance evaluations? you said you're going to do it. when? >> we're going to be scheduling a special topics review to look at the impediments to reporting into the past performance database. >> and when is that going to happen? >> that's going to be kicked off in may, sir. >> and how long will it take? >> i would estimate three months. >> okay. you're going to -- you also say you look forward to using civilian agency tracking tool based on that developed by dod. when are you going to start using that? >> my understanding is that tool will be available in april, sir.

>> okay. and, finally, you say you find it beneficial to solicit references on similar programs. how often do you solicit similar references and what do you mean by beneficial in this case? >> i don't have a statistic, sir, but that's what mr. gordon was referring to about we get a reference on a particular solicitation and the contracting officer follows up with that reference. i'd like to know how often you've done it, go outside the cpars with other references. is it 10% time, 190% of the time. you could give if you could give that to me for the record, please >> i don't know how to get that particular statistic, sir. >> well, how do you know it's beneficial? you're making an assertion that it's beneficial but you don't even know how often it's being done. well, you're in charge. tell me. don't stare at me, please >> i don't know how often it's

being done, sir. >> so how do you know it's beneficial? >> i know that it's beneficial for the contracting officer to get information on past performance. >> based on what? based on what the contracting officers tell you? >> based on the feedback i get from the operational office, yes, sir. >> but again, how often is that? >> i don't know, sir. >> okay. i think my point has been made. admiral ginman, on page 7 of your testimony, you say the commitment to counterinsurgency contracting leads to a more moderate approach. what do you mean by a moderate approach? >> in particular i'll start with -- it will work in either iraq or afghanistan. but when i'm attempting to develop industries within afghanistan and i am looking at past performance with a company that is being developed, i may not expect their past performance to be as great as i would like and can i work with them so that i can develop that company or develop that particular industry within

afghanistan to create the jobs in the theater so it's a recognition that could i perhaps buy clothing outside of afghanistan? yes, i could. do i want to do that? it meets an objective to develop that capability inside the theater to create the jobs. >> okay. fair enough. so this is part of afghan first? >> yes, sir. >> have those standards have been set yet? >> have the -- >> in other words, you're buying afghans now. you say there has to be a more moderate approach. well, the approach involves setting some sort of standards or some new methodology. have you set it yet? in other words -- >> no, no, sir. i think i understand the question. i do not know the answer to that that question. >> could you please let me know? >> yes i will. >> how much money are you spending on afghan first type of contracts? you don't know that either? >> i don't know the amount on afghan first off the top of my head. >> see, i think our taxpayers would really like to know that.

they'd like to know that and they'd also like to know exactly how you set >> about what i need to do to create those jobs and responsibilities in kandahar, then i will do it there. >> regardless of standards? >> i need to be able to meet

whatever the threshold requirement is for the specification and i need to work with the company to ensure that they can meet that specification. >> are those guidelines written out? >> well, the requirement is laid out in each individual contract for, this is what the clothing needs to meet. this is what the boot needs to meet. this is what the concrete -- whatever the product is that we're buying, at last specification that we expect to be met. >> of course. >> and then working with the company to meet it. >> that's the part i'm asking you about. working with the company because presumably if past performance isn't what you want it to be but you want to work with the company, have you laid out rules so that people know how to work with the company? you're trying to do something different, fine. you say you're doing it different. are there some rules? >> does everybody do it?

>> yeah. >> you can -- >> i'll take it for the record. i'm struggling a little bit how we develop the company, mer >> well, but you're the one that mentioned it, not me. >> well, you're asking for a standard. >> yeah. >> so i'm trying to -- >> there must be some minimal standard. >> i'm trying to think through when i went to business school i trained there was some level of standard in the united states that this is what you've got to do when you work with a company -- >> will you get back with me with an? >> i will get back with an answer. >> sometimes when a hearing is over how fair is it to be talking to you folks on that side. you all are dedicated government employees. i want to put that on the record. and mr. blalock, i've been the toughest on you, but thank you for your service. what sometimes happens in a hearing, though, things come up that just illustrate that this is not a priority yet.

and for you, mr. blalock, you are u.s. navy counsel. that's your job. you've been given, i think, incredible opportunity to chair the interagency suspension committee. i view it as significant because you, mr. gordon, have pointed out $500 billion. so, you know, we're talking about a half a trillion dollars. what a hell of an opportunity. so i'm struck with, if you can't draw on the people in your office and the other folks who who come together for this interagency can't draw on their people, you need to request people. i need to know, have you ever requested full-time staff for this responsibility? >> i have not. >> okay. >> there was a full-time staff member for the prior chair. >> let me tell you, i get the gist. the bottom line you can't do

your job because it hasn't been done in '09 and '10 so it would seem logical to me that you would at the very least request this because it is important. as i think mr. gordon and all of you realize. and i think that's mr. mr. henke was coming in and at least let people know because it's such a huge issue. i want to read the recommendations that we've made. i want you to tell me which one you agree with the most. i'm going to ask each of you and which one you agree with the least. and so i'll read them. recommendation 20 allow contractors to respond to but not appeal agency performance assessments. that could take a year. align past performance assessment with contractor proposals. 22 require agencies certify use of the past performance database. 23, require a written rationale for not pursuing a proposed suspension or debarrment. increase use of suspensions and

debarrments and 25, recommendation 25, revise regulations to lower procedural barriers to continue in suspension and debarrment. now, if one or two you don't precisely understand then just put that as a neutral. of the ones you heard and you understand, which do you agree which the most and which do you agree the least 'cause this conversation is going to continue. mr. gordon? >> i'll be very brief. >> people say when they're very brief, they aren't. >> i promise you this time. 20 would be the one i agree with. >> allow contractors to respond to but not appeal. >> i was trying to be brief. [laughter] >> and 24 with the reference to automatic suspension, i'm most concerned about. >> okay. thank you, mr. chairman. >> i'm sorry. i think the one that bothers me the most -- >> start with the positive. >> start -- well, start with the positive. allow contractors to respond and

not appeal to agencies. >> i would assume you like them all and you had trouble figuring out -- >> no, no, i was struggling which one did i like best. >> okay. now, which one is obviously you don't like as much? >> 21, i'm not as good at suspension and debarrments since i don't deal with it day in and day out but just with past performance. the one that bothers me the most is the past performance. because our performance is abysm abysmal, the ability to go get additional data and go to the program managers and go to the -- >> i get the gist. >> from my standpoint is very problematic. >> mr. ridner? >> i would say i like most -- the idea of the contractors being able to respond to past performance but not dispute it. >> right. >> and the certification -- the

contractors' inability to use past performance that's not in the database. again, i think we need more responsibility on the side of the government and i don't know -- >> let me get a response to that. >> sorry, sir? >> the bottom line is, right now we need the government to start to put this in and right now there's no incentive for the contractor to do it because they just assume put their documents in without having anything else. >> okay. >> so it seems to me what we're doing is we're going to have the contractors nag you. that's the reason. >> okay. >> i agree with my colleagues. with recommendation 20. i think that's a great idea. i'm torn in choosing my second between 21 and 23. >> okay. >> and i would welcome a real detailed conversation. >> which one do you like? >> i'm torn between 21 and 23, which ones i dislike. >> required written rationale for not pursuing a proposed suspension or debarrment. you don't think that makes sense. >> do think it makes sense if it's a recommendation from the inspector general's office.

but we've also been encouraged to look outside just of the i.t. referrals. . >> yes, ma'am. >> and i would like to comment on 21. >> i agree with the recommendation but only if we fix both of these first. because if we don't, everyone will be getting a neutral rating and that's not in anyone's best interest. >> fair enough. mr. blalock? >> i hope it's a no-brainer that the chair of the isdc would agree most strongly with the increased use of suspension debarrment recommendations. with respect to disagree, it's a toss up for me between 21 and 24. i'm strongly opposed to automatic exclusions because i believe the sdo needs to have the discretion to judge each case on its own facts and circumstances. i also don't think that the recommendation for a written rationale for deck clanation in my view that is a solution looking for a problem. i do not think there is a problem with major declarations.

>> thank you, mr. fiore? >> sir, i defer to ofpp and dod on the past performance issues. that's outside of my purview. on the suspension and debarrment issues, i have real concern with lowering the standards in the contingency operation. we haven't had any trouble applying the current standards in afghanistan and iraq. >> i'll let you start with the telling first. what's the positive? >> i really don't have a positive one in suspension and debarrment because i think that the army has already increased its use of suspension and debarrment. i don't have a problem with written record of why suspension and debarrment action isn't taken. depending on how you define a referral, some agencies get a complete packet referred to them and they want feedback. in the army all we get often is a very slim investigative report and we do all the work at the headquarters level and it isn't referred until the very end and then there is a record already. >> gotcha.

thank you. thank you all. we will start with you mr. fiore and we'll go down the line that way any closing comments that you would like to make without comment from us? >> i appreciate the opportunity to be here. and i appreciate the oversight and the transparency you're giving to the suspension of the debarrment process by having these hearings. >> thank you. >> i apologize to the commission if my explanation for the delay in filing the reports was taken is an excuse. i'm trying to explain a few facts of life with respect to life in the government now. i have committed and i will get the combined fiscal year '09, fiscal year '10 report by the end of march. >> thank you, sir, very much. >> i'd like to thank the commission for their report and i would welcome a detailed discussion about each of your recommendations so we can be sure that we can implement them.

it's clear that for past performance we all need to do better. and we need to all work together to enhance the systems. we've got a good start there. but i would like make a plea since this is contingency contracting. it's very difficult for our contracting officers in afghanistan and iraq to currently take the training because it's only during business hours in washington, d.c. so i'd like that to be expanded. i think that would help a long way in training. thank you. >> thank you. mr. ridner? >> okay. i appreciate the opportunity to appear before the commission. i appreciate your work. and i look forward to department of state improving on past performance reporting. >> thank you, sir. >> i have a great friend named gillman. >> it rhymes with martini. thank you for the opportunity to be here today. what it is that we're doing in iraq and afghanistan and the troops in support of the troops is important.

ensuring that we get contractors that, in fact, have a solid record of past performance is important. as these two charts so clearly articulate, we have not done that well yet. and you have a commitment from the department, from the leadership perspective to work to ensure that we improve the statistics on both of these charts. >> mr. chairman -- >> i also want to thank you for the opportunity to be here. i would urge the commission as you're finalizing your report and thinking about past performances, suspension and debarrment to keep them in the context of the overall report which is very much resonant without priorities in the administration, strengthen the acquisition work force, demonstrate fiscal responsibility. rebalance our relationship with contractors so contracting is not a default option and when we do this to contractors, the federal government maintains control of those contractors and does contract management. thank you. >> thank you, mr. god, you

probably would have been brief and it would have been the first time and so at least now i don't have to revise my view. i would say thank you for your service. i would also say we have found the administration incredibly cooperative. and mr. gordon, we realize up here it's not a partisan issue. and it's not one from the commission working with administration or with congress. so kind of we're all in this together. thank you for allowing us to expose what we think can be helpful and we realize that it's easier to expose than to solve and we want to be part of the solving as well. so thank you very much. and this hearing is ended. thanks, grant. [inaudible conversations]

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