OMB Watch recently submitted comments and recommendations on needed reforms to the federal contracting process in response to a presidential memorandum issued earlier in 2009. The Presidential Memorandum on Government Contracting directs the Office of Management and Budget (OMB) to both collaborate with federal agencies to review existing contracts and to develop new guidance to help reform future government contracting.

The first part of the president's March 4 memo calls on OMB and agencies to review existing contracts to look for savings. On July 29, OMB Director Peter Orszag released a memo to agencies that provides "guidance on reviewing existing contracting and acquisition practices." Originally required by July 1, the memo requires agencies to review their current contracting and acquisition processes with the goal of developing a plan to save seven percent of baseline contract spending by the end of FY 2011. The memo also requires agencies to "reduce by 10 percent the share of dollars in FY 2010 that are awarded with high-risk contracting vehicles. High-risk contracting vehicles include non-competitive contracts or contract competitions that receive only one bid, cost-reimbursement contracts, and time-and-materials contracts. Agencies are required to develop these plans and submit them to OMB by Nov. 2.

OMB is still working on the second part of the president's memo, which requires new guidance to reform the contracting process going forward. The president identified four areas of reform the new guidance should address, including maximizing the use of competition; improving practices for selecting contract types; strengthening the acquisition workforce; and clarifying those functions that federal employees – as opposed to contractors – must perform. The March 4 memo also directed OMB to hold a public meeting to begin soliciting public testimony and to foster further discussion of the matter. The meeting, which took place on June 18, was well attended by contractors and contracting trade groups, along with a small cadre of public interest groups, including OMB Watch.

OMB also solicited public written comments through July 17. The comments submitted by OMB Watch focus on the need for transparency and openness in the government contracting process:

OMB Watch strongly supports the Obama administration's drive to strengthen the federal acquisition system and recommends several courses of action to further that objective. Overall, these recommendations are guided by OMB Watch's belief in the power of transparency and access to government information to transform government processes and produce better outcomes for the public. Without greater transparency, issues of waste, fraud, and abuse; conflicts of interest; and poor performance will continue to plague the federal procurement process.

It remains to be seen what effect these comments and similar submissions from other public interest groups will have on OMB's reform guidance. The president's contracting reform memo states that Orszag must develop guidance by Sept. 30.