This is the accessible text file for GAO report number GAO-03-552R 
entitled 'Contract Management: OFPP Policy Regarding Share-in-Savings 
Contracting Pursuant to the E-Government Act of 2002' which was 
released on March 24, 2003.



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March 24, 2003:



Ms. Angela B. Styles:



Administrator:



Office of Federal Procurement Policy:



Washington, D.C.



Subject: Contract Management: OFPP Policy Regarding Share-in-Savings 

Contracting Pursuant to the E-Government Act of 2002:





Dear Ms. Styles:



In January 2003, we issued two reports that provide insight regarding 

the 

share-in-savings (SIS) provisions of the E-Government Act of 

2002:[Footnote 1] one on critical elements of training for new 

acquisition initiatives[Footnote 2] and one on commercial practices 

that foster successful SIS contracting.[Footnote 3] As follow-up to 

these reports, we are writing to underscore the need for the Office of 

Federal Procurement Policy (OFPP) to ensure (1) that members of the 

federal acquisition workforce understand and appropriately apply this 

new authority and (2) that appropriate data are collected and available 

to meet mandated reporting requirements regarding the effective use of 

SIS contracting.



As you know, SIS contracting represents a significant change in the way 

the federal government acquires information technology. In our report 

on improving training for new acquisition initiatives, we emphasized 

the importance that industry and government experts place on training 

to successfully implement such change. Training on this information 

technology acquisition initiative will be essential to its effective 

implementation. In our report on SIS contracting, we highlighted the 

federal government’s limited experience with SIS contracting as well as 

conditions that fostered successful implementation in commercial SIS 

contracts. In commenting on a draft of our commercial SIS contracting 

report, OFPP staff acknowledged the need to consider lessons learned by 

industry, and they stated that our report would be taken into account 

when structuring future policy regarding the use of this contracting 

technique in the federal government. In view of the potential benefits 

of this initiative, we think OFPP should consider developing policy and 

guidance that (1) specifically address the need for a well-defined 

training program and 

(2) incorporate practices that fostered success in the commercial SIS 

contracts we reviewed.



The E-Government Act requires (1) the Director of the Office of 

Management and Budget (OMB) to submit a report containing descriptive 

as well as evaluative information on the use of SIS contracts to the 

Congress not later than 2 years after the date of the enactment of the 

act and (2) the Comptroller General to conduct a review of the OMB 

report and provide an independent assessment of the effectiveness of 

the use of SIS contracts not later than 6 months after the OMB report 

is issued.



Providing meaningful reports to the Congress will depend on the 

availability of good data. However, experience has shown that such data 

have not always been available to make program assessments. For 

example, in March 1998, we reported that procurement data were 

inadequate to determine whether the key purposes of the Federal 

Acquisition Sreamlining Act of 1994 were being achieved.[Footnote 4] 

Given this past experience and the limited use of SIS contracting by 

the federal government, we encourage you to consider the need to 

collect data on the federal government’s use of SIS contracting 

pursuant to the E-Government Act. The data should be uniform, reliable, 

and sufficient to accurately assess SIS use, and provide meaningful 

reports to Congress regarding the effectiveness of SIS contracting in 

improving agency processes and achieving agency missions.



We are also sending copies of this report to the Administrator of the 

General Services Administration. In addition, the report will be 

available at no charge on the GAO Web site at http:// www.gao.gov. If 

you have any questions about this report, please contact me at (202) 

512-4841 or Ralph Dawn at (202) 512-4544. Key contributors to this 

report were Robert Ackley, Daniel Hauser, Mary Jo Lewnard, and Karen 

Sloan.



Sincerely yours,



David E. Cooper:



Director, Acquisition and Sourcing Management:



Signed by David E. Cooper:



(120209):



FOOTNOTES



[1] Section 210, Public Law 107-347 (Dec. 17, 2002).



[2] Acquisition Management: Agencies Can Improve Training on New 

Initiatives, GAO-03-281 (Washington, D.C.: Jan. 15, 2003).



[3] Contract Management: Commercial Use of Share-in-Savings 

Contracting, GAO-03-327 (Washington, D.C.: Jan. 31, 2003).



[4] Acquisition Reform: Implementation of Key Aspects of the Federal 

Acquisition Streamlining Act of 1994, GAO/NSIAD-98-81 (Washington, 

D.C.: Mar. 9, 1998).