Service Contracts and the National Defense Authorization

This is a repost, revised, from an older Blog.  It is closely related to an earlier post on contractors working within the government's work sites.

The National Defense Authorization (NDA), an annual congressional product, has sections that pertain to government contracting.  The last version to make significant changes to government service contracting was the 2008 NDA.

It may seem like quite a jump from the FAR to the current NDA, but the two have a couple of things in common. Both are products of the legislative process. And both have significant impact upon contracting.

In regard to service contracts, (construction contracts excepted), the NDA requires the Secretary of Defense to issue certain guidance. Three main points of emphasis are

• that contracts let for personal services be performed in accordance with applicable statutory and regulatory requirements
• that no contracts be let for services that are deemed "inherently governmental functions"
• and that, to the maximum extent possible, no contracts be let for services that are "closely associated with" inherently governmental functions.

The act also directs the military departments to issue guidance with respect to insourcing new and contracted out functions. In general, insourcing means that military departments shall, on a regular basis, utilize Department of Defense (DOD) civilian employees

• to perform new functions, and
• functions currently performed by contractors that could be performed by DOD civilian employees.

Guidelines and procedures developed by the military departments shall provide for "special consideration" to be given to using DOD civilian employees to perform any function that

(1) is performed by a contractor and

• has been performed by DOD civilian employees at any time during the previous 10 years
• is a function closely associated with the performance of an inherently governmental function
• has been performed pursuant to a contract awarded on a non-competitive basis; or
• has been performed poorly, as determined by a contracting officer during the 5-year period preceding the date of such determination, because of excessive costs or inferior quality; or

(2) is a new requirement, with particular emphasis given to a new requirement that is similar to a function previously performed by DOD civilian employees or is a function closely associated with the performance of an inherently governmental function.

Implementation of these guidelines within TRADOC have so far required that requirements packages be modified by expanding the number of "yes" or "no" questions on worksheets the requiring activity must fill out. "Yes" answers to most questions now require written explanation. And a general officer, or senior executive service civilian, must now put signature to the requirements package before a contracting activity may process it for award.