The post-award costs of contracting out: the U.S. Navy's implementation of OMB Circular A-76
Cole, Nancy Sage
Cole, Charles Pegram, Jr.
Carrick, Paul M.
Jones, Larry R.
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The Commercial Activities program as delineated by OMB Circular A-76 has been controversial since its inception. One area of continuing controversy is the accuracy of pre-award cost estimates for estimating post-award program savings in operations that are contracted out. This thesis examines the post-award result of contracting out and identifies those costs that are either underestimated or not accounted for in the cost comparison process. Research was conducted on 14 West Coast activities that contracted out a food service operation, storage and warehousing operation, or both under a multi-function contract. The issues identified by the study include: the need for post-award guidance and policy, the need for increased claimant guidance at the field level, the absence of an adequate cost accounting system and post-award program controls, the need for increased contract administration staffing, a problem with budget flexibility at activities that have contracted out and continuing problems with performance definition.
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