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February 28, 2018

Improvements Could Be Made in FAA’s Award and Oversight of SE2020 Acquisition Program Task Orders

Self-Initiated
Project ID: 
ZA2018029
View PDF Document

What We Looked At 
The Federal Aviation Administration’s (FAA) Next Generation Air Transportation System (NextGen) is a multibillion-dollar system intended to modernize the Nation’s air traffic system. To support NextGen and non-NextGen initiatives, FAA awarded seven multiple-award contracts under the Systems Engineering 2020 (SE2020) portfolio. In this follow-up report to our 2012 audit of SE2020, we assessed whether the FAA’s actions for (1) awarding task orders and (2) overseeing the SE2020 acquisition program were sufficient to meet its program mission. 

What We Found 
FAA’s insufficient policies and guidance for awarding SE2020 task orders hindered the Agency’s efforts to fully achieve its mission. First, FAA awarded program management task orders and used high assessment fees to fund them—up to 10 percent—from January 2012 to September 2015. Second, while FAA has increased competition for new task orders, it has experienced challenges in competing follow-on task orders and has not updated its SE2020 program office’s task order award standard operating procedure to reflect its emphasis on competition. As a result of these weaknesses, the SE2020 contract did not achieve its level of expected use. Originally FAA estimated SE2020 would provide $7.1 billion in support services, but the Agency has since lowered its estimate to $1.2 billion. 

FAA’s ineffective oversight and management of SE2020 limited its ability to achieve program goals. For example, FAA’s SE2020’s payment processes lacked sufficient oversight, causing delays in making invoice payments and recouping overpayments. Furthermore, the SE2020 program office lacks effective and up-to-date program management plans and a strong oversight framework and guidance for managing large multiple-award contracts. This lack of specific policy to manage multiple-award contracts such as the SE2020 program hinders FAA’s ability to provide effective oversight that ensures such contracts meet their intended goals. 

Our Recommendations 
FAA concurred with our 11 recommendations to improve its award, management, and oversight of the SE2020 program and other multiple-award contract vehicles. Based on FAA’s response, we consider all 11 recommendations resolved and open pending completion of planned actions.

Recommendations

Open

Closed

Closed on 05.18.2020
No. 1 to FAA

Revise AMS to include policy or guidance on justifying the use of program management task orders and a process for implementing assessment fees for multiple-award contracts.

Closed on 04.24.2020
No. 2 to FAA

Update SE2020's standard operating procedure for competition of SE2020 task orders, including strengthening procedures for follow-on awards.

Closed on 09.01.2021
No. 3 to FAA

Strengthen and document procedures to collect and analyze SE2020 task-order timeliness data to sustain improvements in task order award time.  

Closed on 04.16.2020
No. 4 to FAA

Revise AMS to include policy or guidance for multiple-awards contracts to address acquisition planning, such as estimating contract hours and costs and overall contract estimates.

Closed on 04.24.2020
$44,000
No. 5 to FAA

Strengthen, document, and implement controls for SE2020 invoice review to comply with the Prompt Payment Act. Implementation of this recommendation could put up to $44,000 in funds to better use.

Closed on 05.18.2020
No. 6 to FAA

Revise AMS to include policy or guidance for multiple-award contracts to describe the appropriate structure for fee payments in cost plus fixed-fee contracts.

Closed on 04.06.2020
No. 7 to FAA

Obtain direct and indirect cost audits for all SE2020 prime contractors for all base contract years, or document the risk assessments performed to justify when cost audits are not performed.

Closed on 01.24.2020
No. 8 to FAA

Revise AMS to include policy or guidance for obtaining direct and indirect cost audits for multiple-award cost-reimbursable contracts or to perform risk assessments to justify not obtaining them.

Closed on 05.18.2020
No. 9 to FAA

Enhance procedures and controls to require SE2020 staff with responsibility for oversight of task orders to track and document vendor performance through its Performance-Based Contract Monitoring (PBCM) system.

Closed on 04.06.2020
No. 10 to FAA

Revise AMS to require FAA's acquisition program office that manages multiple-award contract vehicles to develop and maintain comprehensive program management and governance plans.

Closed on 04.06.2020
No. 11 to FAA

Revise AMS to strengthen multiple-award contract oversight and management framework to ensure such multiple-award contracts follow sound business practices and AMS policies and procedures.