Essentially the Marines allowed the contractor that produced the Mine Resistant Ambush Protected Vehicle (MRAP) to run the show when it came to monitoring the contract. These were not small potatoes items. They were designed to offset the impact of the IEDs that are now common in our battles in Iraq and Afghanistan. Plus, there was real money involved; the contracts, awarded to Jacobs Technology and SAIC (Science Applications International Corp), were worth $378,000,000. The whole MRAP program is expected to cost $17.6 billion. This is a vital and costly program, yet the military ceded control of the contract to the guys who were the recipients of the contract. Here are some excerpts from the report of the DOD IG (my emphases):
The officials inappropriately allowed the contractor to exert controls over functions that should have remained under the authority of the Federal Government when providing support to the MRAP vehicle program operations in Southwest Asia. The contractor performed inherently governmental functions by directing Government personnel, participating in disciplinary actions of Government personnel, and preparing and signing SOPs. The contractor also engaged in functions that may approach being inherently governmental by being involved in the development of contract requirements and participating in situations where the contractor personnel may be assumed to be Government representatives.
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In addition, the contracting officer did not assess organizational conflicts of interest prior to or during contract performance as required. Contractor employees were involved in providing program analysis and oversight while providing maintenance services. Contractor employees also were involved in activities in which they were unable or potentially unable to render impartial services and advice to the JPO MRAP because they were, in effect, monitoring their own performance. Also, the JPO MRAP officials created an organizational structure for JPO MRAP Forward that relied on contractor employees to provide support in both overseeing and performing maintenance and logistics activities, thereby generating potential organizational conflicts of interest. A single Government employee was assigned overseas to oversee a multimillion-dollar contract in three different countries, which greatly increased the risk for potential waste or abuse. Further, by relying on the contractor for functions that should have remained under the control of the Government, the officials increased the risk of improper execution of the contract and did not ensure that the contract for JLI services was in the best interest of DoD.
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The D&F and prior contract data did not adequately support the contracting officer’s decision for procuring commercial services using a T&M contract type. The contracting officer could have used information from the initial JLI effort to estimate the extent or duration of the work needed for the JLI follow-on effort. Instead, the contracting officer awarded the JLI follow-on effort as a T&M contract, which provides no positive profit incentive to the contractor for labor efficiency or cost control. When using this type of contract, the contracting activity should monitor and manage the contractor’s performance closely.
Do you think that there may be some cost savings in DOD?
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