The idea of a contractor known for winning no-bid contracts receiving a contract to investigate no-bid contracts allows us a knowing chuckle. The actual awarding of federal contracts — when it is brought to light — seems just as preposterous and should be no laughing matter.
A recent bipartisan report by the House Committee on Government Reform showed just how bad things have gotten. It concluded that “contract mismanagement is widespread [and] costs to the taxpayer are enormous.” It showed that contracts awarded by the Department of Homeland Security without full competition jumped by a whopping 739 percent between 2003 and 2005.
In fact, more than half of the $10 billion contracted out in 2005 by the department did not involve full competition. Among the questionable contracts highlighted in the report was $915 million on nearly 26,000 trailers to house hurricane victims and relief workers — none for disaster zones in Louisiana and Mississippi because of prohibitions on their use in flood plains. Another $19 million went to Transportation Security Administration office space for 140 employees that includes 12 conference rooms, seven kitchens, a fitness center, and $500,000 worth of artwork and office decor.
An earlier study commissioned by Rep. Henry Waxman found the fastest growing part of discretionary spending comes in the form of federal contracts.
“[T]he federal government is now spending nearly 40 cents of every discretionary dollar on contracts with private companies, a record level, according to an online article by the Committee on Government Reform.
Between 2000 and 2005, spending on federal contracts jumped $175 billion — or 86 percent — pushing procurement spending to $377.5 billion.
Whether you agree with our government’s heavy reliance on contractors, you’ll find it hard to excuse the rapid rise in no-bid and other noncompetitive contracts. These contracts jumped from $67.5 billion in 2000 to $145 billion to 2005.
This should raise an eyebrow of anyone concerned with cronyism, but even if no special favors are provided, the potential for waste, fraud and abuse is tremendous.
It isn’t just the no-bid contracts that raise management questions.
The Waxman report identifies the top federal contractors, noting that only 20 corporations received 36 percent of all contract money awarded in 2005.
Halliburton has been the fastest-growing contractor. “In 2000, Halliburton was the 20th-largest federal contractor … By 2005, Halliburton had grown to become the sixth-largest federal contractor, receiving nearly $6 billion in federal contracts” — an astonishing 600 percent increase.
The growth in contracting generally, bigger and bigger contracts awarded to a handful of corporations, and the contracts increasingly awarded without competition mean that the American public needs better monitoring of what is going on.
Yet the government has no user-friendly searchable database to provide information on recipients of federal financial assistance, including contracts. The General Services Administration has attempted to make information about contracts available, but it contracted out that service — and let’s just say it has been less than helpful.
Senators from both parties, led by Tom Coburn and Barack Obama, are now working to do something about this. They introduced the Federal Funding Accountability and Transparency Act to create what Coburn calls “Google for government spending,” an indispensable tool that will deliver information the public has every right to know.
The Coburn-Obama bill would organize new and existing data into one searchable Web site, allowing the public to sort by contract or grant type, by the issuing agency, by recipient, and by state and congressional district.
The bill has 18 co-sponsors — from Sens. Frist and Reid, to McCain and Clinton — and endorsements from a very broad spectrum of conservative and liberal organizations.
It was unanimously approved last week by the Senate Homeland Security and Government Affairs Committee. The House-passed legislation in June that is similar, but does not require disclosure of contracts, only federal loans and grants, a glaring omission that makes it unsuitable for serious consideration.
There is no time to waste. With no opposition expected, the Coburn-Obama bill should be passed by unanimous consent before the Senate takes its August recess.
The House should welcome the Senate version and simply adopt the stronger disclosure requirements when it reconvenes in September.
In a Congress likely to be labeled a “do-nothing Congress,” this would be an important legislative achievement. Let’s hope they act quickly and unanimously to shed sunlight on how taxpayer funds are being spent.
Gary D. Bass and Dana Chasin are executive director and senior adviser on budget and tax issues, respectively, at OMB Watch.