OMB Cites Reforms in Contracting Practices The Office of Management and Budget says agencies are making “substantial progress” in reining in the use of “risky” contract types. During the first half of fiscal 2010, OMB said 15 of the 24 largest agencies achieved President Obama’s goal of a 10% reduction in spending on noncompetitive contracts, including new sole-source awards and contracts that attracted only one bid. Seventeen of the 24 agencies reported a 10% reduction in dollars awarded under cost reimbursement contracts or time-and-materials/labor hour contracts. “Agencies are achieving these reductions through the implementation of sound contracting practices such as peer reviews and contract review boards that bring seasoned contract and other experts together to help contracting and program offices identify and address high risk practices,” the report said. “Practically, these steps are saving taxpayer dollars,” OMB director Peter Orszag wrote in his blog. The emphasis on fixed-price contracts was part of the president’s directive to cut overall contract spending by 7% over the next two years. OMB said agencies have made progress toward that goal. As agencies implement plans to reach the goal, “at least two promising cost-savings trends have already emerged,” said Dan Gordon, administrator of OMB’s Office of Federal Procurement Policy. He cited increasing use of strategic sourcing and reverse auctions as key elements in driving down prices. Gordon pointed to GSA’s blanket purchase agreements for office supplies, which will be used by all agencies. He said the next targets for governmentwide strategic sourcing initiatives are IT and medical and surgical supplies. He said online reverse auctions for commercial off-the-shelf products “have become a routine part of how we conduct procurements in the 21st century.” Gordon testified July 15 at a hearing of the Senate Budget Committee’s Task Force on Government Performance.